s.394 - Unfair dismissal

Application for relief from unfair dismissal - small business employer - whether minimum employment period completed - transfer of business - regular and systematic casual engagement - person protected from unfair dismissal - dismissal not consistent with Code - unfair dismissal - compensation ordered.

• [1] Steven Hooper commenced working as a barista at the Lords of Pour café at Ettalong Beach on the Central Coast of New South Wales on around 27 April 2023. Mr Hooper continued working at the café through two changes in ownership. Shahbod Pty Ltd (Shahbod) took ownership of the café on 10 July 2024. Mr Hooper initially worked on a casual basis for Shahbod and then commenced permanent part-time employment on 10 October 2024. Mr Hooper was working at the café on 26 January 2025 when he left work abruptly at around 8:00am. Mr Hooper informed the manager, Omid Ghabousi, that he had to go home and left the café. Mr Ghabousi sent a text message to Mr Hooper at 1:36pm on 26 January 2025 which stated Mr Hooper's employment was terminated. A termination letter was also emailed to Mr Hooper. This decision concerns whether Mr Hooper had completed the minimum employment period of 12 months with Shahbod, whether Mr Hooper's dismissal was consistent with the Small Business Fair Dismissal Code (SBFDC), and whether Mr Hooper was unfairly dismissed.

• [2] A hearing was held via video on 5 June 2025. A schedule of the material relied on by the parties is attached at the end of this decision. None of the witnesses were required for cross-examination. I have considered all the evidence and submissions.

Initial matters - uncontested provisional views

• [3] Under s.396 of the Fair Work Act 2009 (FW Act), the Commission is obliged to decide the following matters before considering the merits of the application:

(a) whether the application was made within the period required in subsection 394(2);

(b) whether the person was protected from unfair dismissal;

(c) whether the dismissal was consistent with the SBFDC;

(d) whether the dismissal was a case of genuine redundancy.

• [4] Mr Hooper's unfair dismissal application was filed on 14 February 2025, which was within 21 days of his employment ending on 26 January 2025.

Was Mr Hooper a person protected from unfair dismissal?

• [5] Section 382 of the FW Act provides that a person is protected from unfair dismissal if, at the time of being dismissed:

(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and

(ii) an enterprise agreement applies to the person in relation to the employment;

(iii) the sum of the person's annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high-income threshold.

• [6] Shahbod indicated in its Form F3 response that it had a total of six employees when Mr Hooper was dismissed on 26 January 2025.[1] Mr Hooper did not contest this evidence. I find Shahbod was a "small business employer" as defined in s.23 of the FW Act at the time of Mr Hooper's dismissal. That means Mr Hooper needed to have completed a minimum employment period of 12 months to be a person protected from unfair dismissal.[2]

• [7] Mr Hooper had not been employed by Shahbod for a period of 12 months when he was dismissed on 26 January 2025. Shahbod only took ownership of the café on 10 July 2024. Mr Hooper initially worked for Shahbod as a casual employee and then commenced permanent part-time employment on 10 October 2024. The issue of whether Mr Hooper had completed the minimum employment period of 12 months therefore turns on whether any of Mr Hooper's service for the previous owners of the café is to be counted as service with Shahbod.

• [8] The previous owner of the café was Outwit Outplay Outlast Pty Ltd as trustee for the Unkauf Family Trust (Outwit). Cindy Unkauf is the sole director of Outwit. Ms Unkauf provided evidence that Mr Hooper commenced casual employment with Outwit when she acquired the café on 15 May 2023.[3] Ms Unkauf did not provide detailed evidence about Mr Hooper's engagements with Outwit.

• [9] Mr Hooper provided evidence from the "homebase" rostering system which identifies the shifts Mr Hooper was rostered to work for Outwit from May 2023 to July 2024. This evidence demonstrates Mr Hooper was rostered for three or four shifts nearly every week. Mr Hooper was rostered to start work at 6:45am and would finish at varying times around the middle of the day.

• [10] Service as a casual employee does not count towards an employee's "period of employment" unless:

• • the employee was a "regular casual employee", which means a casual employee that has been employed by the employer on a regular and systematic basis,[4] and
• • the employee had a "reasonable expectation of continuing employment by the employer on a regular and systematic basis."[5]

• [11] The ACT Court of Appeal has previously confirmed in Yaraka v Giljevic that it is the casual employee's engagement that must be regular and systematic, not the hours worked pursuant to the engagement.[6]

• [12] I find the rostering evidence provided by Mr Hooper clearly demonstrates he was employed by Outwit on a regular and systematic basis and had a reasonable expectation of continuing employment on a regular and systematic basis from 25 May 2023 to 20 July 2024.

• [13] The next issue that must be determined is whether Mr Hooper's service with Outwit counts as service with Shahbod. Section 22 of the FW Act defines "service" and "continuous service". Section 22(5) states that if there is a "transfer of employment" in relation to the employee, "any period of service of the employee with the first employer counts as service of the employee with the second employer."

• [14] To satisfy the definition of "transfer of employment" in s.22(7) of the FW Act, the relevant employee must become employed by the second employer within three months after their employment with the first employer terminates. In addition:

• the first employer and the second employer must be associated entities, or
• the employee must be a "transferring employee" in relation to a "transfer of business" from the first employer to the second employer, in circumstances where the two employers are not associated entities.

• [15] The definition of "transfer of business" appears in s.311 of the FW Act. The definition is satisfied where:

• the employment of an employee of the old employer has terminated,
• the employee becomes employed by the new employer within 3 months of their termination with the old employer,
• the work the employee performs for the new employer is the same, or substantially the same, as the work the employee performed for the old employer (this is the "transferring work"), and
• there is a connection between the old employer and the new employer.

• [16] There are four types of "connection" between the old employer and the new employer. Three of the types of connection are not relevant to this case.[7] The type of connection that Mr Hooper relies upon is a transfer of assets from the old employer to the new employer. In broad terms, this connection will be established where there is an arrangement between the old employer and the new employer which provides that the new employer will own or have the beneficial use of some or all of the assets (whether tangible or intangible) that the old employer owned or had use of, and the assets relate to, or are used in connection with, the "transferring work."

• [17] The sale contract between Outwit and Shahbod clearly establishes there was transfer of both intangible goodwill and tangible plant and equipment between Outwit and Shahbod in relation to, or in connection with, the transferring barista work performed by Mr Hooper.

• [18] I find Mr Hooper was a "transferring employee" in relation to a "transfer of business" from Outwit to Shahbod because:

• Mr Hooper commenced working for Shahbod within three months of being terminated by Outwit;
• The barista work performed by Mr Hooper for Outwit and Shahbod was the same, or substantially the same; and
• there was a connection between Outwit and Shahbod because assets transferred as part of the sale agreement.

• [19] The exclusion in s.384(2)(b) of the FW Act is not applicable here because there is no evidence that Shahbod informed Mr Hooper in writing before his employment with Shahbod started that his service with Outwit would not be recognised as service with Shahbod. The inclusion of a probationary period clause in Mr Hooper's part-time employment contract does not constitute the type of notice contemplated by s.384(2)(b) of the FW Act.

• [20] My findings above mean that Mr Hooper's regular and systematic casual service with Outwit from 25 May 2023 to 20 July 2024 counts as service with Shahbod.

• [21] The rostering information provided by Mr Hooper shows that he was a regular casual employee of Shahbod with a reasonable expectation of continuing employment on a regular and systematic basis from 10 July 2024 to 9 October 2024. Mr Hooper continued being rostered by Shahbod in a regular and systematic way and using the same "homebase" rostering system that had been used by Outwit. There was no significant change to Mr Hooper's casual engagement when the ownership of the café changed from Outwit to Shahbod. This finding means Mr Hooper had around three months of service with Shahbod before he was employed on a part-time basis.

• [22] There was no dispute Mr Hooper's period of employment includes his part-time employment with Shahbod from 10 October 2024 to 26 January 2025. That is a period of around three-and-a-half months.

• [23] Based on my findings above, Mr Hooper's total "period of employment" with Shahbod comprises:

• Around 14 months of regular and systematic casual service with Outwit - this service counts as service with Shahbod because there was a transfer of business from Outwit to Shahbod,
• Around three months of regular and systematic casual service with Shahbod, and
• Around three-and-a-half months of part-time employment with Shahbod.

• [24] I therefore find Mr Hooper had completed the minimum employment period of 12 months with Shahbod when he was dismissed on 26 January 2025.

• [25] There was no dispute that Mr Hooper's employment with Shahbod was covered by the Restaurant Industry Award 2020 (Award). Mr Hooper's part-time employment contract expressly referred to the Award conditions.[8] Mr Hooper's earnings as a barista were also below the high-income threshold.

• [26] I find that Mr Hooper was a person protected from unfair dismissal when he was dismissed by Shahbod on 26 January 2025.

• [27] Shahbod did not argue that Mr Hooper's employment ended by reason of genuine redundancy. I find Mr Hooper's employment did not end due to a genuine redundancy.

• [28] Shahbod argued that its dismissal of Mr Hooper was consistent with the SBFDC.

• [29] It is not entirely clear whether Shahbod summarily dismissed Mr Hooper for alleged serious misconduct, or whether he was dismissed with notice for performance issues during his probationary period. The SBFDC checklist filed by Shahbod alleges that Mr Hooper committed serious misconduct by leaving the café without an adequate explanation at 8:00am on 26 January 2025.[9] However, Mr Hooper's termination letter states he was dismissed "following a careful review of your performance during your probationary period." The termination letter also states that Mr Hooper was entitled to one week of notice of termination, or a payment in lieu.

• [30] I consider Mr Hooper's termination letter should be relied upon over the SBFDC checklist given it is a contemporaneous document that records the reason for Mr Hooper's dismissal. The termination letter is also generally consistent with the text message Mr Ghabousi sent Mr Hooper at 1:36pm on 26 January 2025. I find Mr Hooper was not summarily dismissed by Shahbod.

• [31] There is no evidence that Mr Hooper was notified that he was at risk of being terminated before he was dismissed by Shahbod on 26 January 2025. Mr Hooper was not given any formal warnings about his performance and Mr Hooper was not given any opportunity to rectify any alleged issues with his performance. There were no discussions between Shahbod and Mr Hooper about his potential dismissal prior to the final decision being communicated to Mr Hooper on 26 January 2025.

• [32] For the reasons identified above, I find Mr Hooper's dismissal was not consistent with the SBFDC because the type of process required for a non-summary dismissal was not followed by Shahbod.

• [33] If I had found that Mr Hooper was summarily dismissed by Shahbod, I would have found that the summary dismissal was not consistent with the SBFDC because there were not reasonable grounds for a belief that Mr Hooper's conduct was sufficiently serious to justify summary dismissal. There was no reasonable investigation conducted in relation to why Mr Hooper left the café at around 8:00am on 26 January 2025. If a reasonable investigation had been undertaken, Mr Hooper would have had the chance to explain that his mental health issues caused him to leave the café.

• [34] Given my findings above in relation to the initial matters, I am required to consider the merits of Mr Hooper's unfair dismissal application.

• [35] Section 387 of the FW Act provides that, in considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the Commission must take into account:

(a) whether there was a valid reason for the dismissal related to the person's capacity or conduct (including its effect on the safety and welfare of other employees); and

(b) whether the person was notified of that reason; and

(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and

(e) if the dismissal related to unsatisfactory performance by the person - whether the person had been warned about that unsatisfactory performance before the dismissal; and

(f) the degree to which the size of the employer's enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(h) any other matters that the FWC considers relevant.

• [36] I am required to consider each of these factors, to the extent they are relevant to the factual circumstances before me.[10]

Was there a valid reason for dismissal related to Mr Hooper's capacity or conduct?

• [37] In order to be a valid reason, the reason for the dismissal should be "sound, defensible or well founded"[11] and should not be "capricious, fanciful, spiteful or prejudiced."[12] However, the Commission will not stand in the shoes of the employer and determine what the Commission would do if it was in the position of the employer.[13]

• [38] Where a dismissal relates to an employee's conduct, the Commission must be satisfied that the conduct occurred and justified termination.[14] The question of whether the alleged conduct took place and what it involved is to be determined by the Commission on the basis of the evidence in the proceedings before it. The test is not whether the employer believed, on reasonable grounds after sufficient enquiry, that the employee was guilty of the conduct which resulted in termination.[15]

• [39] There is no real factual dispute between the parties regarding what happened at the end of Mr Hooper's employment. Mr Hooper left the café abruptly at around 8:00am on 26 January 2025 and informed Mr Ghabousi "I have to go home." Mr Southon gave evidence that Mr Hooper's mood that morning was affected by a disagreement about the use of an alternative for chocolate.[16]

• [40] Mr Hooper subsequently indicated in a message to a colleague, Renay, at 12:56pm on 26 January 2025 that the reason he left the café was because he was "about to break or have a panic attack." That explanation is consistent with Mr Hooper's evidence during this proceeding and is supported by medical evidence which confirms Mr Hooper suffers from depression and anxiety.[17]

• [41] However, it is also clear that Mr Ghabousi was not aware of Mr Hooper's mental health issues when he decided to terminate Mr Hooper's employment at around 1:36pm on 26 January 2025. Mr Ghabousi did not know why Mr Hooper felt like he had to leave the café at around 8:00am and was understandably upset about the café being left short staffed on a busy public holiday. Mr Ghabousi waited for an apology or explanation from Mr Hooper and when that had not been provided by the early afternoon, Mr Ghabousi dismissed Mr Hooper.

• [42] Although Mr Hooper's termination letter refers to concerns about Mr Hooper's performance, Mr Hooper denies that any concerns had been raised with him prior to his dismissal. The evidence relied upon by Shahbod indicates Mr Hooper may have been difficult to deal with at times, but it does not show that there were genuine issues with his performance as a barista. In any event, it is clear it was Mr Hooper abruptly leaving the café on 26 January 2025 that triggered the decision to end his employment. There is no evidence that Mr Hooper was likely to be dismissed due to poor performance if he had not left the café abruptly on 26 January 2025.

• [43] I consider that it was inappropriate for Mr Hooper to abruptly leave the café at around 8:00am on 26 January 2025 without explaining to Mr Ghabousi why he needed to leave. However, I consider Mr Hooper's conduct must be viewed in context, given it is now clear that his mental health issues contributed to his actions. I do not consider Mr Hooper's conduct on 26 January 2025 was sufficiently serious to constitute a valid reason for dismissal.

• [44] I find this factor weighs in favour of finding that Mr Hooper's dismissal was unjust and unreasonable.

Was Mr Hooper notified of the reason for dismissal?

• [45] Proper consideration of s.387(b) requires a finding to be made as to whether Mr Hooper "was notified of that reason". Contextually, the reference to "that reason" is the valid reason found to exist under s.387(a).[18]

• [46] Notification of a valid reason for termination must be given to an employee protected from unfair dismissal before the decision is made to terminate their employment,[19] and in explicit[20] and plain and clear terms.[21]

• [47] Mr Hooper was not notified of the reason for dismissal before Mr Ghabousi communicated the dismissal at around 1:36pm on 26 January 2025.

• [48] This factor weighs in favour of finding Mr Hooper's dismissal was unjust and unreasonable.

Was Mr Hooper given an opportunity to respond to the valid reason?

• [49] An employee protected from unfair dismissal should be provided with an opportunity to respond to any reason for their dismissal relating to their conduct or capacity. An opportunity to respond is to be provided before a decision is taken to terminate the employee's employment.[22]

• [50] The opportunity to respond does not require formality and this factor is to be applied in a common-sense way to ensure the employee is treated fairly.[23] Where the employee is aware of the precise nature of the employer's concern about his or her conduct or performance and has a full opportunity to respond to this concern, this is enough to satisfy the requirements.[24]

• [51] Mr Hooper was not provided with an opportunity to respond to the reason for dismissal before Mr Ghabousi communicated his dismissal at around 1:36pm on 26 January 2025.

• [52] This factor weighs in favour of finding that Mr Hooper's dismissal was unjust and unreasonable.

Did Shahbod unreasonably refuse to allow Mr Hooper to have a support person present to assist at discussions relating to the dismissal?

• [53] This is a neutral factor given there were no discussions relating to the dismissal before it was communicated to Mr Hooper.

Was Mr Hooper warned about unsatisfactory performance before the dismissal?

• [54] Mr Hooper was not formally warned about any of the alleged issues with his performance prior to being dismissed on 26 January 2025. However, despite what is recorded in the termination letter, I consider it was Mr Hooper's conduct in abruptly leaving the café without an adequate explanation that was the reason for his dismissal. I consider this is a neutral factor.

To what degree would the size of Shahbod's enterprise be likely to impact on the procedures followed in effecting the dismissal?

• [55] I accept Shahbod is a small business and that this substantially impacted on the procedures that were followed in effecting Mr Hooper's dismissal. I consider this factor reduces the weight that should be given to the procedural fairness issues in the overall assessment of unfairness.

To what degree would the absence of dedicated human resource management specialists or expertise in Shahbod's enterprise be likely to impact on the procedures followed in effecting the dismissal?

• [56] I accept the absence of dedicated human resource specialists had a substantial impact on the procedures that were followed in effecting Mr Hooper's dismissal. I consider this factor reduces the weight that should be given to the procedural fairness issues in the overall assessment of unfairness.

• [57] Section 387(h) requires the Commission to take into account any other matters that the Commission considers relevant.

• [58] Neither party argued there were any other relevant factors that should be considered. I find there are not any other relevant matters.

• [59] I have made findings in relation to each matter specified in s.387 of the FW Act. I must consider and give due weight to each as a fundamental element in determining whether the termination was harsh, unjust, or unreasonable.[25]

• [60] Having considered each of the matters specified in s.387 of the FW Act, I am satisfied that the dismissal of Mr Hooper was unjust and unreasonable. There was not a valid reason for Mr Hooper's dismissal relating to his conduct or capacity. The process implemented to dismiss Mr Hooper was also extremely flawed, although I accept the size of Shahbod's enterprise and a lack of professional support contributed heavily to the shortcomings.

• [61] I find Mr Hooper was unfairly dismissed.

• [62] Mr Hooper does not seek reinstatement. I find reinstatement is inappropriate.

Is an order for payment of compensation appropriate in all the circumstances of the case?

• [63] Having found that reinstatement is inappropriate, it does not automatically follow that a payment for compensation is appropriate. As noted by the Full Bench, "[t]he question whether to order a remedy in a case where a dismissal has been found to be unfair remains a discretionary one..."[26]

• [64] Where an applicant has suffered financial loss as a result of the dismissal, this may be a relevant consideration in the exercise of this discretion.[27]

• [65] Mr Hooper has suffered financial loss in circumstances where I have found he was unfairly dismissed. In all the circumstances, I consider that an order for payment of compensation is appropriate.

Compensation - what must be taken into account in determining an amount?

• [66] Section 392(2) of the FW Act requires all of the circumstances of the case to be taken into account when determining an amount to be paid as compensation to Mr Hooper in lieu of reinstatement including:

(a) the effect of the order on the viability of Shahbod's enterprise;

(c) the remuneration that Mr Hooper would have received, or would have been likely to receive, if Mr Hooper had not been dismissed;

(d) the efforts of Mr Hooper (if any) to mitigate the loss suffered by Mr Hooper because of the dismissal;

(e) the amount of any remuneration earned by Mr Hooper from employment or other work during the period between the dismissal and the making of the order for compensation;

(f) the amount of any income reasonably likely to be so earned by Mr Hooper during the period between the making of the order for compensation and the actual compensation; and

(g) any other matter that the Commission considers relevant.

• [67] I consider all the circumstances of the case below.

Effect of the order on the viability of Shahbod's enterprise

• [68] Although I do not have detailed financial evidence about Shahbod, Mr Ghabousi provided compelling submissions regarding the tight margins for the business during the hearing. I consider this factor weighs in favour of a lower compensation order.

• [69] Mr Hooper was employed by Shahbod for less than two years, including his prior service with Outwit, and another previous owner. This is a relatively short period of service. I consider this factor weighs in favour of a lower compensation order.

Remuneration that Mr Hooper would have received, or would have been likely to receive, if Mr Hooper had not been dismissed

• [70] As stated by a majority of the Full Court of the Federal Court, "[i]n determining the remuneration that the employee would have received, or would have been likely to receive... [the Commission must] address itself to the question whether, if the actual termination had not occurred, the employment would have been likely to continue, or would have been terminated at some time by another means. It is necessary for the Commission to make a finding of fact as to the likelihood of a further termination, in order to be able to assess the amount of remuneration the employee would have received, or would have been likely to receive, if there had not been the actual termination."[28]

• [71] Taking all the evidence into account, I find Mr Hooper would likely have remained employed with Shahbod for a further three months if he had not been unfairly dismissed. This is the "anticipated period of employment."[29] I consider the evidence demonstrates that there were increasingly tensions between Mr Hooper, Mr Ghabousi, Ms Haghian, and other staff. I consider it is likely that Shahbod would have moved to terminate Mr Hooper's employment before the probationary period expired in April 2025. I also consider it is likely Mr Hooper would have found it difficult to continue working for Shahbod and may have resigned in the near future to seek other work.

• [72] Mr Hooper was paid $1,138.00 gross per week plus superannuation. I calculate the remuneration Mr Hooper would have been likely to receive working for Shahbod for 13 weeks (around 3 months) from 26 January 2025 to 26 April 2025 to be $14,794.00 gross, plus superannuation.

Efforts of Mr Hooper to mitigate the loss suffered by Mr Hooper because of the dismissal

• [73] Mr Hooper must provide evidence that he has taken reasonable steps to minimise the impact of the dismissal.[30] What is reasonable depends on the circumstances of the case.[31]

• [74] Mr Hooper has provided a significant amount of evidence regarding steps he has taken to find other work including applying for positions. Mr Hooper commenced employment for Oz Surpahs Pty Ltd on 5 March 2025.

• [75] I find no deduction should be made for a failure to mitigate loss.

Amount of remuneration earned by Mr Hooper from employment or other work during the period between the dismissal and the making of the order for compensation

• [76] Mr Hooper has provided payslips which show he earned around $4,117.04 gross plus superannuation from his employment with Oz Surpahs Pty Ltd from 5 March 2025 to 23 April 2025.

Amount of income reasonably likely to be so earned by Mr Hooper during the period between the making of the order for compensation and the actual compensation

• [77] Given the anticipated period of employment has finished, I do not need to take this into account.

• [78] Neither party submitted that there were any other relevant matters.

• [79] As noted by the Full Bench, "[t]he well-established approach to the assessment of compensation under s.392 of the FW Act... is to apply the "Sprigg formula" derived from the Australian Industrial Relations Commission Full Bench decision in Sprigg v Paul's Licensed Festival Supermarket (Sprigg).[32] This approach was articulated in the context of the FW Act in Bowden v Ottrey Homes Cobram and District Retirement Villages[33]."[34]

• [80] The approach in Sprigg is as follows:

Step 1: Estimate the remuneration the employee would have received, or have been likely to have received, if the employer had not terminated the employment (remuneration lost).

Step 2: Deduct monies earned since termination. Workers' compensation payments are deducted but not social security payments. The failure to mitigate loss may lead to a reduction in the amount of compensation ordered.

Step 3: Discount the remaining amount for contingencies.

Step 4: Calculate the impact of taxation to ensure that the employee receives the actual amount he or she would have received if they had continued in their employment.

• [81] I have estimated that Mr Hooper would have remained employed by Shahbod for three months until 26 April 2025.

• [82] The remuneration Mr Hooper would have received, or would have been likely to have received, from his dismissal on 26 January 2025 until 26 April 2025 is $14,794.00 gross plus superannuation.

• [83] Only monies earned since termination for the anticipated period of employment are to be deducted.[35]

• [84] Mr Hooper earned $4,117.04 gross plus superannuation from his employment with Oz Surpahs Pty Ltd during the anticipated period of employment.

• [85] For the reasons outlined above, I have not applied a deduction for failing to mitigate loss.

• [86] A figure of $10,676.96 plus superannuation remains after Mr Hooper's earnings during the anticipated period of employment are deducted.

• [87] I now need to consider the impact of contingencies on the amounts likely to be earned by Mr Hooper for the remainder of the anticipated period of employment.[36]

• [88] Mr Hooper's anticipated period of employment has ended, and I know what remuneration he earned during that period. I therefore do not need to make a deduction for contingencies.

• [89] I have considered the impact of taxation but have elected to settle a gross amount of $10,676.96 plus superannuation and leave taxation for determination.

Compensation - is the amount to be reduced on account of misconduct?

• [90] If I am satisfied that misconduct of Mr Hooper contributed to the employer's decision to dismiss_,_ I am obliged by s.392(3) of the FW Act to reduce the amount I would otherwise order by an appropriate amount on account of the misconduct.

• [91] I am satisfied that Mr Hooper engaged in low level misconduct when he left the café abruptly without providing a sufficient explanation on 26 January 2025. I consider a deduction of 5% is appropriate on account of this misconduct.

• [92] An amount of $10,143.11 gross plus superannuation remains after the 5% deduction.

Compensation - how does the compensation cap apply?

• [93] Given Mr Hooper's rate of earnings a compensation cap of $29,588.00 gross plus superannuation applies in accordance with s.392(6) of the FW Act.

• [94] Having applied the formula in Sprigg, I am nevertheless required to ensure that "the level of compensation is an amount that is considered appropriate having regard to all the circumstances of the case."[37]

• [95] The application of the Sprigg formula has resulted in an outcome where Mr Hooper would be awarded compensation of $10,143.11 gross plus superannuation of $1,166.46.

• [96] I am concerned that a compensation order of $10,143.11 plus superannuation will jeopardise the viability of Shahbod. I am also conscious that Mr Hooper was only employed for a relatively short period.

• [97] For these reasons, I consider it is appropriate to reduce the compensation order to $8,000.00 gross plus superannuation of $920.00.

• [98] Given my findings above, I will make an order[38] that Shahbod must pay Mr Hooper $8,000.00 less taxation, plus superannuation of $920.00 to be paid into Mr Hooper's nominated fund, with both payments to be made within twenty-eight (28) days of the date of this decision.

Mr Ghabousi and Ms Haghian representing Shahbod.

A2 Screenshots of text messages between Mr Ghabousi and Mr Hooper concerning Mr Hooper's dismissal.

A3 A copy of Mr Hooper's permanent part-time employment contract with Shahbod dated 24 September 2024.

A4 Screenshots of emails sent to Mr Hooper from a "homebase" rostering system showing Mr Hooper's rostered hours from May 2023 to January 2025.

A5 Screenshot of a text message from Mr Hooper to a colleague named Renay at 12:56pm on 26 January 2025.

A6 Evidence and submissions from Mr Hooper dated 2 May 2025.

A7 A letter of support from Amy Liu dated 2 October 2024. Mr Hooper worked for Ms Liu's business before and after his employment with Shahbod.

A8 Medical records concerning Mr Hooper's mental health condition.

A9 A statutory declaration from Mr Hooper's mother concerning his longstanding and ongoing mental health issues.

A10 Screenshots of text messages from Mr Hooper concerning absences on 24 November 2024 and 13 January 2025.

A11 Documents concerning Mr Hooper's attempts to find other employment and earnings since his dismissal.

A12 Evidence and submissions from Mr Hooper dated 23 May 2025 and 30 May 2025.

A13 A copy of the sale contract for the Lords of Pour café from Outwit to Shahbod.

A14 A screenshot of text messages between Mr Hooper and Mr Ghabousi following Mr Hooper's dismissal.

R1 An email from Ms Haghian dated 25 February 2025 which contains information about Mr Hooper's dismissal and an attached Form F3 employer response.

R2 A timeline of relevant events and Shahbod's response to material filed by Mr Hooper dated 25 February 2025.

R3 A copy of Mr Hooper's termination letter dated 26 January 2025.

R4 A Small Business Fair Dismissal Code checklist document prepared by Shahbod.

R5 Submissions and evidence from Mr Ghabousi filed on 23 May 2025.

R6 Witness statement from Nicholas Southon (Shahbod employee) dated 7 April 2025.

R7 Witness statement from Marjan Haghian (Director and Owner) dated 13 May 2025.

R8 Invoices concerning expenses incurred by Shahbod in relation to its purchase of the café.

R9 Witness statement from Cindy Unkauf (previous owner) dated 20 May 2025.

R10 Payslips issued by Shahbod to Mr Hooper and a bank record concerning Mr Hooper's final payment.

Mr Hooper provided oral submissions during the hearing on 5 June 2025.

Mr Ghabousi and Ms Haghian provided oral submissions during the hearing on 5 June 2025.

[6] Yaraka Holdings Pty Ltd v Giljevic [2006] ACTCA 6; (2006) 149 IR 339 at [65].

[7] The three types of connection are in general terms an outsourcing arrangement, an insourcing arrangement, or where the employers are associated entities.

[10] Sayer v Melsteel Pty Ltd [2011] FWAFB 7498, [14]; Smith v Moore Paragon Australia Ltd PR915674 (AIRCFB, Ross VP, Lacy SDP, Simmonds C, 21 March 2002), [69].

[11] Selvachandran v Peteron Plastics Pty Ltd [1995] IRCA 333; (1995) 62 IR 371, 373.

[13] Walton v Mermaid Dry Cleaners Pty Ltd [1996] IRCA 267; (1996) 142 ALR 681, 685.

[14] Edwards v Justice Giudice [1999] FCA 1836, [7].

[15] King v Freshmore (Vic) Pty Ltd Print S4213 (AIRCFB, Ross VP, Williams SDP, Hingley C, 17 March 2000), [23]-[24].

[18] Bartlett v Ingleburn Bus Services Pty Ltd [2020] FWCFB 6429, [19]; Reseigh v Stegbar Pty Ltd [2020] FWCFB 533, [55].

[19] Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137, 151.

[20] Previsic v Australian Quarantine Inspection Services Print Q3730 (AIRC, Holmes C, 6 October 1998).

[22] Crozier v Palazzo Corporation Pty Ltd t/a Noble Park Storage and Transport Print S5897 (AIRCFB, Ross VP, Acton SDP, Cribb C, 11 May 2000), [75].

[23] RMIT v Asher [2010] FWAFB 1200; (2010) 194 IR 1, 14-15.

[24] Gibson v Bosmac Pty Ltd [1995] IRCA 222; (1995) 60 IR 1, 7.

[25] ALH Group Pty Ltd t/a The Royal Exchange Hotel v Mulhall (2002) 117 IR 357, [51]. See also Smith v Moore Paragon Australia Ltd PR915674 (AIRCFB, Ross VP, Lacy SDP, Simmonds C, 21 March 2002), [92]; Edwards v Justice Giudice [1999] FCA 1836, [6]-[7].

[26] Nguyen v Vietnamese Community in Australia t/a Vietnamese Community Ethnic School South Australia Chapter [2014] FWCFB 7198, [9].

[27] Vennix v Mayfield Childcare Ltd [2020] FWCFB 550, [20]; Jeffrey v IBM Australia Ltd [2015] FWCFB 4171, [5]-[7].

[28] He v Lewin [2004] FCAFC 161, [58].

[29] Ellawala v Australian Postal Corporation Print S5109 (AIRCFB, Ross VP, Williams SDP, Gay C, 17 April 2000), [34].

[30] Biviano v Suji Kim Collection PR915963 (AIRCFB, Ross VP, O'Callaghan SDP, Foggo C, 28 March 2002), [34] citing Lockwood Security Products Pty Ltd v Sulocki and Ors PR908053 (AIRCFB, Giudice J, Lacy SDP, Blair C, 23 August 2001), [45].

[31] Biviano v Suji Kim Collection PR915963 (AIRCFB, Ross VP, O'Callaghan SDP, Foggo C, 28 March 2002), [34] citing Payzu Ltd v Saunders [1919] 2 KB 581.

[32] [1998] AIRC 989; (1998) 88 IR 21.

[33] [2013] FWCFB 431.

[34] Double N Equipment Hire Pty Ltd t/a A1 Distributions v Humphries [2016] FWCFB 7206, [16].

[36] Enhance Systems Pty Ltd v Cox PR910779 (AIRCFB, Williams SDP, Acton SDP, Gay C, 31 October 2001), [39].

[37] Double N Equipment Hire Pty Ltd t/a A1 Distributions v Humphries [2016] FWCFB 7206, [17].

[38] PR788137.

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