Tranter v Shaan Holdings Pty Ltd t-as Shaan Eyeworks and another

Tranter v Shaan Holdings Pty Ltd t-as Shaan Eyeworks and another - [2006] NSWIRComm 245 - NSWIRComm 2004 case summary — Zoe

[20]

3 The applicant is a qualified optical mechanic with a number of years experience in the eyewear and optical products industry. Before his employment commenced with the first respondent the applicant was in full-time employment with a competitor eyewear company known as Mod-Style. He described his employment with that business in his affidavit as secure and stable. In about October 2000 the applicant was approached directly by the second respondent to work for the first respondent. The applicant initially refused the offer but later accepted an offer of employment at a base salary of $10,000 per month inclusive of superannuation. The applicant's total salary package also included a fully maintained car, mobile telephone and business tools, as well as a commission of $500 payable on the sale of each "smart mirror". Also included in his salary package were certain sales incentives in the form of fully paid overseas holidays conditional upon sales targets being met. 4 The applicant commenced work for the first respondent on 1 December 2000. The first respondent at that time was a wholesale supplier of ophthalmic products including spectacle frames, lenses, sunglasses, video imaging systems and electronic rimless drills. Its customers included optometrists and optical dispensaries throughout Australia as well as overseas. Responsibility for the sales and service of the first respondent's customers was divided among five area sales managers. Approximately 15 to 20 percent of the first respondent's sales volume was generated from sales in New South Wales (except for the Northern Rivers region) and the Australian Capital Territory. Approximately 50 to 55 percent was generated in Queensland and the Northern Rivers region in New South Wales. When the applicant commenced work for the first respondent he was appointed to the position of area sales manager for New South Wales (excluding the Northern Rivers region). He was based in Sydney and travelled extensively as the first respondent's sales representative. Shortly after the applicant commenced work for the first respondent he travelled once to Western Australia. In late 2003-2004 the applicant also travelled to South Australia about three to four times visiting customers of the first respondent. 5 During the next few years the applicant continued to work for the first respondent. For the year ended 30 June 2003 the applicant's sales exceeded his budget by some 9 percent. On October 6 2003 he received a congratulatory email from Mr Aaron McColl, the first respondent's commercial manager, for achieving his budget for the first quarter of the 2003-2004 financial year. In the previous year, on 4 March 2003 the applicant took part in a performance review conducted by Aaron McColl. His work was assessed over a wide range of criteria and he received a positive rating to the effect that he met job requirements and often exceeded them. Comments on the performance review document encouraged the applicant to "keep up the good work". For the financial year ending 30 June 2003 the applicant received an award from the first respondent for "Sales person of the year". The award, bestowed yearly, was won by the salesperson who accumulated the most points. The points were based on four key performance measures, namely: sales budgets performance, productivity call rate, administration activity timelines, and personal evaluation and appraisal. The applicant actually accumulated the second most number of points during the year but won the award after the winner left the first respondent's employ in March 2003. 6 In mid-February 2004 the second respondent telephoned the applicant and asked him to attend a meeting in Brisbane at the first respondent's head office on 17 February 2004. No details were given to the applicant concerning the likely content of the meeting. According to the second respondent at about the same time the first respondent received a report from its financial advisor. The report (which was not in evidence) advised that the first respondent should pay its salespersons salaries commensurate with sales generated. This had not been the basis upon which payments of salaries had been adopted by the first respondent at that time. The second respondent intended to discuss that fact with the applicant and advise him that in his view, sales made by the applicant for the previous year had been, "well below expectations" and that the sales figures could not justify the salary he was being paid. 7 On 17 February the applicant was driven to the first respondent's head office by Aaron McColl. According to the accounts of both the applicant and Aaron McColl, the applicant asked Aaron McColl what the meeting was about. Aaron McColl replied that it was about the applicant's future with the company. The only attendees at the meeting that day were the applicant and the second respondent. 8 Both parties have recorded their respective recollections of the conversation which occurred during the meeting in their affidavits. According to the applicant the conversation proceeded along the following lines:

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(iii) the applicant was, on the evidence, offered the position he occupied prior to 17 February 2004 on the same terms which governed the position prior to that date. 23 The respondents' "reasons" substantially overlap and it is therefore convenient that they be dealt with together in assessing whether the applicant's case has demonstrated any relevant unfairness under s 106 of the Act. 24 In contending that the Court lacks jurisdiction by reason of the circumstances of termination being properly characterised as a breach of contract, the respondent relies on an unreported decision of the Court of Appeal of Tokyo Network Computing Pty Ltd and Anor v Tanaka [2004] NSWCA 263 (2 August 2004). In that decision the Full Court had before it an appeal from a decision of Bryson J who awarded damages for wrongful dismissal against the first appellant and specific performance against the second appellant. At first instance Bryson J had concluded that a company resolution of the first appellant to reduce the respondent's salary amounted to an anticipatory breach of his contract of employment. Handley JA with whom Mason P and Tobias JA agreed, confirmed Bryson J's conclusion. Handley JA added (at [11]): (The respondent) promptly accepted that repudiation, as he was entitled to do, prior to the employer's attempt to withdraw it. His acceptance of the repudiation brought the contract to an end because of the anticipatory breach. 25 The respondents here contend that the applicant's version of events may be described, in the absence of any unfair contractual terms, as a breach of the contract. The present claim is therefore the same as the respondent's claim in Tokyo Network Computing. Support for this construction of the applicant's case by the respondents and the corresponding limits on the operation of s 106 is sought to be found in Sydney Water Corporation with particular reliance being placed on certain comments made by Mason P at [35], [40] and [49] of that decision. 26 It should be stated at the outset, that allegations of unfairness, where they rely on the conduct of a respondent party, must be in some way referable to the terms or operation of the impugned contract or arrangement in order to fall within s 106. But this is not a novel proposition. In Truelove v Sydney Water Corporation Ltd (2005) 146 IR 253 the Full Bench of the Industrial Relations Commission in Court Session (now Industrial Court) in commenting on the findings of the Court of Appeal in Sydney Water Corporation confirmed the relationship between conduct and the terms of a contract of employment within the scheme of s 106 of the Act. At [21]-[22] of the decision the Full Bench said:

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Section 106 is available to a party whether or not in breach of contract, and whether before or after termination has been effected. Walker makes this clear in the reference (at 149) to a contract being unfair because of the limited or discriminatory rights conferred in the particular case on an employee at the stage of his or her dismissal. (See also per Kirby P at 134 and Incitec v Industrial Court of New South Wales (1992) 45 IR 155 at 156-7 per Gleeson CJ.) But it simply does not follow that a contract of employment is unfair because or whenever it leaves the employee to remedies under the general law. There would need to be a finding that those remedies were relevantly "unfair" generally or in regard to the contract at hand before the Commission's remedial jurisdiction would be enlivened, assuming that such a finding is within the contemplation of the section. I doubt that it is, although it is unnecessary to resolve that matter finally. 28 In the present application the respondents contend that their conduct as characterised and relied upon by the applicant is not referable to any terms of the contract of employment, and, that if the Court were to find otherwise the Court would fall into error. 29 The applicant's case that the contract was, or became, unfair at the meeting of 17 February 2004 and following must be examined by reference to how the applicant has pleaded his case in the summons. I have earlier attempted to summarise those pleadings. They rely quite plainly not on what the contract expressly provided but on what it failed to specify (or provide), and also, what it permitted. The context in which the word "permitted" is used I take to mean that which the contract did not proscribe. In other words, the contract of employment in the absence of any terms or conditions dealing with procedures to be adopted on termination, failed to proscribe the creation and implementation of termination procedures that the applicant contends were unfair or operated unfairly against him. It also failed to proscribe variations to the applicant's remuneration package which the applicant also contends were unfair. The construction of the word "permitted" where used for example to describe conduct referable to, and which may render a contract of employment unfair, was referred to by Mason P in Sydney Water Corporation when examining Sheller JA's use of the term in the Court of Appeal decision of Walker v Industrial Court of New South Wales & Anor (1994) 53 IR 121 at 149. In Sydney Water Corporation at [32] - [33] Mason P said:

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34 Similarly, in the present circumstances the applicant pleads his case as one where, by reason of certain conduct engaged in by the respondents, the contract became unfair because it "permitted" the respondents in the absence of provisions to the contrary to vary his terms of remuneration by reducing his salary to an unacceptable level and to terminate his employment. Such an approach to s 106 is permissible in order to determine whether the impugned contract is or became unfair. 35 I should add for completeness that where the applicant relies on what the contract has failed to specify (which I take to mean the same as "failed to provide") this approach is also within the jurisdictional reach of s 106 and therefore falls within its terms for consideration as to whether or not the contract as pleaded is or became unfair: see Walker at 143 (per Kirby P); Truelove at [30]. 36 Having found that the applicant's approach, as pleaded in the summons is consistent with and therefore falls within the provisions of s 106 of the Act the next matter to consider is whether the termination of his employment was at his initiative or at the initiative of the respondents. 37 The applicant contends that the termination of his contract of employment was at the initiative of his employer. This is because the second respondent knew that the amended salary package announced to the applicant on 17 February 2004 was likely to be unsatisfactory to the applicant, and, the second respondent foresaw the possibility of the applicant wishing to leave. The basis in the evidence for this latter assertion is apparent from the words of the second respondent when he told the applicant, "if you accept the new package, I'll have a win. But if you don't I'll also have a win". The applicant also contends that the new salary package was imposed for economic and structural reasons. Under the new package the applicant was expected to take on additional sales areas at a greatly reduced salary. In addition his salary structure was changed so that the base salary was substantially reduced with a corresponding shift to a largely commission based structure. The new package also no longer offered the incentives that were in the original contract. Given the magnitude of the reduction in salary and the expanded sales role which subsumed other sales roles, the new remuneration package should properly be characterised as a redundancy of the applicant's old position and an offer of a different position. In the alternative, the applicant contends it matters not whether his termination of employment is characterised as a dismissal, a redundancy or a "resignation" since a remedy should be provided based on the conduct of the respondents which resulted in the contract becoming unfair. 38 The respondents' position is that the termination of the applicant's employment was not at their initiative. The meeting of 17 February 2004 was conducted in the spirit of negotiation and in the context of good working relations. The proposed reduction to the applicant's remuneration reflected the need to bring the applicant's remuneration into line with industry standards and with other employees' sales. Despite the respondents' proposal and their opening negotiations the applicant chose to leave of his own accord. Moreover the second respondent tried to contact the applicant with a view to conducting further negotiations but the applicant rejected all further advances. The respondents also join issue with the applicant's submissions that he was constructively dismissed by the respondents. The meeting of 17 February, say the respondents, represented the start of negotiations, the applicant was happy to increase his territory and the respondents' request for him to cover a greater sales territory in order to achieve higher sales was reasonable. In addition, neither the second respondent nor Aaron McColl wished the applicant to leave the employ of the first respondent. 39 In Allison v Bega Valley Council (1995) 63 IR 68 the Full Bench of the Industrial Relations Commission acknowledged the existence of cases where an employee has resigned thereby bringing about the termination of his contract of employment but in reality it is the conduct of the employer that, "...has compelled or unduly influenced the employee to resign". The most common example of this, the Full Bench said, was where the employer tells an employee that he or she must resign or be dismissed. The Full Bench also emphasised that an enquiry into which party initiated the termination should involve an analysis into what happened by carefully examining the facts, rather than attempting to formulate general principles. The Full Bench also said (at 73):

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Where an employee initiates the termination of the contract of employment it is necessary to consider whether that ostensible act of termination was given freely and without any undue pressure. If the ostensible resignation is, in effect, a response to and consistent with a desire by an employer that such resignation be forthcoming, then what has occurred may be that the termination has been brought about by the employer and that in this way the employee has been dismissed. 40 The approach set out in Allison v Bega Valley Council, I consider a useful guide when examining whether the applicant's resignation was, in reality, compelled by the respondents or not freely given or given by the applicant under pressure so that it may be construed as having been brought about by or at the initiative of the respondents. 41 The issue of whether an employee's actions in terminating his or her employment is in reality done at the initiative or instigation of the employer (so as to constitute a repudiation of the contract of employment) was explored in the Full Bench decision of Keycorp Limited v Thomes (2004) 141 IR 116. In that decision, which involved an application under s 106 of the Act, the applicant, at first instance, terminated his own employment following the employer/respondent's refusal to pay him a bonus on the basis of alleged unsatisfactory performance even though no parameters had been established or agreed by which the applicant's performance might be assessed. The finding by the first instance judge, that the respondent's failure to establish performance parameters (in order to assess whether a bonus was payable) constituted a repudiation of the contract of employment, was upheld by the Full Bench. As a result, the respondent's failure to establish and agree on the performance parameters in the context of findings of unsatisfactory work performance entitled the applicant to treat himself as discharged from any further performance. The Full Bench also upheld the findings at first instance that the contract of employment was unfair within the terms of s 106 of the Act, and that the applicant was therefore entitled to monetary orders under the section. 42 In upholding the trial judge's findings, the Full Bench examined a number of authorities which considered circumstances where employees had terminated their own employment, in the context of whether the employer's conduct had, in reality, resulted in a repudiation of the contract of employment. The authorities are useful, in my opinion, to consider whether, in an application under s 106 of the Act, the termination of employment by an employee is, in reality, at the initiative or instigation of the employer. 43 The first of these authorities is Western Excavating (ECC) Ltd v Sharp [1978] 1 QB 761 at 769 where Lord Denning MR observed:

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(The reference to $330,000 I take to be a reference to the combined remuneration of both employees at that time.) 49 According to the second respondent, at the end of the meeting, he told the applicant to think about it and let him know by the beginning of next month. This effectively gave the applicant about two weeks (that is, until the beginning of March 2004) to "think about it". 50 The parties have joined issue in relation to whether the new salary package offered to the applicant during the meeting of 17 February 2004 was final or open for further negotiation. According to the applicant, there was little evidence that the respondents were prepared to negotiate upwards from the offer made on 17 February 2004, but even if they were so prepared, the fact that the initial offer was a low offer was itself unfair. 51 In my opinion, the evidence suggests that the new salary package was presented to the applicant at the meeting of 17 February 2004 on the basis that it was final and not open to further negotiations. There is nothing in the subject matter of the 17 February meeting on either the applicant's version or the second respondent's version which might provide a reasonable basis for concluding that the offer was not final. The records of the correspondence exchanged between the parties following the meeting provide an insight, in my view, into the respondents' real intentions. On the same day of the meeting, the second respondent sent an email to the applicant. It said, "Whatever you think or choose to do, I personally hope you stay with us." It would be difficult to elevate such a neutral statement into an expectation on the part of the second respondent that it was open to the applicant to put a counter offer. According to the second respondent's recollection of the conversation which occurred during the 17 February meeting, he told the applicant that he would like the new salary package to commence from May and he gave the applicant until the beginning of March 2004 to decide whether or not to accept. He also told the applicant that whatever he chose to do, it would be a "win-win situation" for the respondents. Such statements in my view are not capable of providing a foundation from which an inference may be drawn that it was the intention of the speaker to engage in negotiations. 52 On 27 February 2004, the applicant wrote a lengthy letter to the second respondent. In the letter the applicant said to the second respondent that he expected to be paid in accordance with his current salary package, "until any variation can be mutually agreed". This suggests that the applicant, at least, was willing to discuss his salary package to see if some mutually suitable arrangement could be agreed. The second respondent's reply by email of 29 February 2004 however was clearly not written in the spirit of negotiation. Instead, the applicant is reminded that at the meeting of 17 February 2004, he was told that, from 1 March 2004 his package would be reduced to $48,000 base salary, and that the new package hardly constituted a "poverty pack". The applicant was also told he had been looked after "exceptionally well", and that, "... if you think you are hard done by, can't rise to the challenge and have got a better job elsewhere then quit. If you have some character and believe you can rise to the challenge then stay". The second respondent, in cross-examination, said he regretted sending that email to the applicant. That may be so, in hindsight, but the applicant was the unfortunate recipient of the email, nonetheless, on the day before the deadline of 1 March 2004 at which time he was required to advise the second respondent whether or not he accepted the reduced salary package. The second respondent's email sent the day before would have given him little hope that the new package was open to negotiation. On 4 March 2004, the applicant responded to the second respondent's email of 29 February 2004 in which he stated that he considered that the second respondent had terminated his employment. The second respondent sent a reply by email the same day informing the applicant that his employment had not been terminated by the respondents, rather, the applicant had terminated his own employment. The email also contained various instructions concerning termination payments and the return of missing goods. 53 There was nothing in that latter email which might have suggested that the second respondent sought to change the applicant's mind. Instead, on 8 March, the first respondent, under the signature of Aaron McColl, sent the applicant a formal letter of offer which set out the terms of the applicant's new remuneration package which had been presented to him on 17 February. The letter of offer gave him two working days to accept the new package. Again, there was no indication that the matter was open to negotiation. The second respondent wrote a further letter to the applicant on 31 March 2004. Although the letter mentioned the word "negotiation" on two occasions, the clear inference available from the contents of the letter is that the applicant either accept the new salary package or leave the employ of the respondents. The only hint of compromise in the letter comes from the respondents' offer to increase the deadline for the proposed date for changing the package until 1 June 2004. On 14 April 2004, the respondents' solicitors sent a letter to the applicant's solicitors attaching a copy of the letter of 31 March. In relation to that item of correspondence, the respondent's solicitors asserted in their covering letter:

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If the words "present position" and "prevailing terms and conditions" are meant to refer to the applicant's salary package prior to 17 February 2004, then the contents of the letter of 31 March, as I have already concluded, do not support such a construction. 54 The meeting of 17 February and the exchange of correspondence which followed must also be considered together with other matters that emerged from the evidence adduced during the proceedings. First, the applicant was given no notice of the purpose or content of the 17 February 2004 meeting. Secondly, one of the reasons relied on by the second respondent to justify the new salary package was the "disappointing" sales figures generated by the applicant. There was, however, little, if any, basis on the evidence for such a justification. The applicant had consistently performed over budget during the financial year ending 30 June 2003 and in the first quarter of the financial year ending 30 June 2004. He won an award for salesperson of the year for the year ending 30 June 2003. His performance review conducted on 4 March 2003 was favourable and he was told to "keep up the good work". This evidence is hardly supportive of the respondents' position that the applicant's sales figures were disappointing or that the applicant had been performing below expectations. Thirdly, the respondents rely on a conversation said to have taken place between the applicant and the second respondent prior to his employment. During this conversation, which was denied by the applicant, the applicant is said to have informed the second respondent that at Mod-Style, his former employer, he had generated sales of between $900,000 and $1,000,000 per year. There was some attempt during the proceedings by the respondents to use this conversation as a basis for supporting the claim that the applicant was not generating sufficient sales. The documentary evidence tendered during the proceedings, however, supports the opposite conclusion, namely, that the applicant was performing well, and that his employer was satisfied with the results. 55 The respondents also claim that, contrary to seeking the applicant's termination, they wished him to remain in the employment of the first respondent. There were a number of statements made to this effect by the second respondent. If this were reflective of the true situation, however, then the statements can only have been made on the condition that the applicant accept the amended salary package. In other words, while the respondents may have desired to retain the services of the applicant, it was only on their terms. As I have found, the new salary package was not open to negotiation, but was imposed, unilaterally on, and without consultation with, the applicant, and, it was unfavourable to him. Given the lack of any reasonable basis, on the evidence, for changing the applicant's salary, such as unsatisfactory sales performance, he was, in my opinion, not obliged to accept the package. In such circumstances the conclusion is available that the applicant's termination of employment was initiated by the respondents: see Keycorp Ltd at [135]. 56 For the same reasons on which I base my findings that the applicant's termination of employment was initiated by the respondents I reject the respondent's contention that the applicant was twice offered his pre-17 February 2004 position with the first respondent. As the exchange of correspondence following the 17 February meeting indicates, the respondents had no intention of leaving open the new salary package for negotiation. Instead it was presented to the applicant as a final offer leaving the applicant with the choice of either accepting it or terminating his own employment. Where this documentary evidence diverges from any oral evidence given by the second respondent or Aaron McColl during the proceedings I prefer the documentary evidence. It is a contemporaneous account of the facts in issue and inherently more reliable than any oral accounts given several months later. 57 The evidence upon which I have based my finding that the applicant's employment was terminated at the initiative of the respondent's, also supports, on balance of probabilities, the conclusion that the applicant's contract of employment with the first respondent was unfair under s 106. The respondents' conduct in unilaterally varying the terms of the applicant's salary package as set out in his contract, leaving him with no choice but to accept a substantially reduced, amended and ultimately unfavourable salary package, was unfair. The contract which contained little detail apart from setting out the applicant's salary package contained no terms in relation to fair procedures to be adopted on termination. It therefore unfairly permitted the respondents to unilaterally impose the salary variation without any prior consultation with the applicant. It also unfairly permitted the respondents to attempt to justify the changes by relying on unsatisfactory performance without giving the applicant any opportunity to respond to such allegations. It also permitted the respondents in the absence of any contractual provisions to initiate the applicant's termination without paying him any severance payment. Orders sought

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58 The applicant seeks twelve months remuneration as a "retrenchment" payment in the sum of $140,000. In written submissions the applicant submitted that any monetary compensation awarded should be along the lines of a severance payment with components for notice and redundancy, and, that the applicant's age, tenure and status with the first respondent as well as the magnitude of the unfairness visited upon him and the fact that he was "head-hunted" from secure employment are all factors that should be taken into account on quantum. In relation to the second respondent the applicant submitted that he was directly engaged in conduct which caused or contributed to the contract and should therefore be held equally responsible for any money order the Court may make. 59 Although not strictly necessary at this juncture, I should state for completeness, that in my opinion the applicant's termination did not take place in the context of a redundancy. The nature of his position upon his termination did not substantially change although it seems there was some alteration to the job description. Following the applicant's departure the second respondent said in evidence that the applicant was replaced by Ms Wendy James who was employed on a salary less than what the applicant had been offered at the meeting of 17 February 2004. According to the second respondent's affidavit, Ms James, who replaced the applicant "almost immediately" after he left, assumed responsibility for New South Wales (excluding the Northern Rivers) and Australian Capital Territory sales regions. This was the same territory for which the applicant had had responsibility immediately prior to his termination of employment. The only change therefore to the applicant's position appears to have been to his salary. On this basis it could not reasonably be said that the applicant's position became redundant. 60 This finding would not however preclude the Court from awarding a payment, or part of a payment in the nature of a redundancy: see Ross v GN Comtext (Australia) Pty Limited (2000) 107 IR 1 at [39]. 61 In Ross v GN Comtext Walton J, Vice-President analysed the distinct rationales for a payment in lieu of notice and a severance or redundancy payment. The distinction was explained in a case relied upon by Walton J in Ross v GN Comtext, namely, Fryar v Systems Services Pty Ltd (1996) 137 ALR 321, where at 331 von Doussa J explained that the nature and purpose of a period of notice or payment in lieu is to give an employee the opportunity to adjust to the change in circumstances while seeking other employment. A severance payment on the other hand has as its purpose compensation for the loss of non-transferable credits and entitlements which have been built up through length of service (such as long service leave, sick leave) as well as for inconvenience and hardship imposed by the termination of employment through no fault of the employee. 62 Walton J in Ross v GN Comtext nevertheless concluded that the nature of a payment ordered by the Court following a finding of unfairness under s 106 of the Act is a matter for the discretion of the Court: at [45]. The Court may therefore, in its discretion assess separate sums having regard to a period of notice and a redundancy payment, or, make one order for payment which takes into account the inadequate notice given and the failure to provide for adequate redundancy benefits. 63 I propose to adopt Walton J's latter approach to the making of a monetary order in the exercise of my discretion, and award, one monetary order which takes into account aspects of a reasonable payment in lieu of notice and an adequate payment in the nature of a redundancy payment. 64 In Gala v State Bank of New South Wales t/a Colonial State Bank (No 2) (1998) 84 IR 216 the applicant at first instance had been employed by the respondent for eleven years as an auditor when she was advised that following an amalgamation between the respondent, (a financial institution) and another financial institution her position would be abolished. On appeal, the Full Bench upheld the applicant's application that certain conduct on the part of the respondent in directing the applicant to immediately take up a new position and perform the specified duties of that position was not a reasonable requirement and that that conduct rendered the contract of employment unfair. In assessing monetary orders the Full Bench calculated a global amount based on a lack of notice and a failure by the respondent to extend benefits which would normally be expected upon a termination on account of redundancy. The applicant was awarded an amount equating to nine months salary based on her annual salary. 65 In the present circumstances the applicant worked for the first respondent for about 39 months. His services were actively sought by the respondents and he accepted the offer of employment at the agreed salary as an enticement to leave secure and stable employment with Mod-Style. He worked for the first respondent in a relatively senior position for the duration of his employment consistently achieving above-budget sales results, and otherwise performing his role satisfactorily. 66 The respondents submit, that the Court if satisfied that it has jurisdiction to decide this matter, should not make any monetary order, but, in the alternative, if such an order is to be entertained and a component for payment of notice considered, then the monetary order should be substantially discounted to reflect the actual period of notice received by the applicant from the date of the 27 February 2004 meeting until 1 May 2004 when the new salary package was destined to take effect. In addition, the fact that the applicant was re-offered the position he occupied prior to 17 February should also be reflected in any monetary order. 67 As regards the first submission, it contradicts in my opinion a central plank of the respondents' case, namely, that the offer of the amended salary package made on 17 February was not final but was open to negotiation. So characterised, there is no basis for accepting that a period of notice effectively commenced on 17 February and continued until 1 May 2004. As regards the second submission I have earlier rejected the respondents' contention that the applicant was offered his pre-17 February 2004 position on two occasions after that date. 68 The respondents also submit that the applicant has failed to mitigate his loss. The submission is advanced on two bases; first that the applicant rejected the respondents' overtures to further discuss "outstanding issues"; and, secondly because he was offered his pre-17 February position which he declined. If the reference to "outstanding issues" is meant as a reference to an alleged failure to discuss his salary package with the respondents following the 17 February meeting then this in my opinion has little support in the evidence. As the exchange of correspondence has disclosed, following that meeting the applicant notified the respondents at an early stage of his reaction to the amended package. I have already dealt with the second basis. 69 As a preliminary proposition the principle of mitigation although it must be taken into account in some circumstances as required by s 106(6) of the Act need not be applied strictly in all cases. The application of the principle has been qualified for example in a number of cases by considerations as to whether an applicant has behaved unreasonably in seeking alternative employment: see Ross v GN Comtext at [57]. The Court Bundle of Documents, tendered in these proceedings contains material which indicates that the applicant from 27 April 2004 made several unsuccessful attempts to obtain other employment. The material in my opinion shows that the applicant made reasonable attempts to mitigate his loss. I do not therefore consider it appropriate to reduce any payment order made on the basis of the principle of mitigation. 70 Taking all these matters into account I consider they justify a payment being made to the applicant of five months at $10,000 per month which represents his base salary inclusive of superannuation prior to 17 February 2004. This results in a total of $50,000. Interest should also be payable from the date of the original application, 23 April 2004, until the date of judgment. 71 The applicant has also made a monetary claim based on "anxiety and distress". I decline to make any money order in relation to this head of claim for two reasons. First, such orders are not commonly made in this jurisdiction following successful applications under s 106. Secondly, the applicant has provided little or no material from which I can properly assess whether such an order may be warranted in the circumstances. 72 It remains to consider whether one or both respondents against whom the applicant is proceeding may be found liable either jointly or severally, or both, for moneys payable to the applicant consequent upon the findings of unfairness which I have made. 73 The first respondent as the applicant's employer for the duration of his employment should be liable for the payment of monetary orders. In relation to the second respondent he was instrumental in imposing on the applicant the variations made to the contract and in the circumstances of the applicant's termination. The evidence which establishes these findings has already been canvassed in detail. Brown and Others v Rezitis and Others (1970) 127 CLR 157 is the authority commonly relied upon in this jurisdiction in assessing whether non-parties to an impugned contract may be held liable for the payment of money orders consequent upon findings of unfairness under s 106. That authority considered the operation of s 88F(2) of the Industrial Arbitration Act 1940 - 1967, a predecessor provision to s 106(5). Barwick CJ at 165 held that the power conferred by s 88F(2) was limited to the making of orders, "connected with the making, performance ... variation or avoidance of the contract or arrangement". The requisite connection according to Barwick CJ must be a "real" or "close" connection between the orders made and the impugned contract (at 168). Further, non-parties to the impugned contract may be held liable for monetary orders on the basis that they had, "received the proceeds of the contract or arrangement or were in some way culpably associated with its making or operation"; see also AFMEPKIU New South Wales Branch v David & Ors [2006] NSWIRComm 206. 74 The analysis of the facts in the present circumstances disclose the second respondent's central involvement in the variations to the applicant's salary package and in the circumstances of his termination, both activities which, as I have found, rendered the contract of employment unfair. The second respondent in my view must therefore jointly, with the first respondent, bear responsibility for the unfairness of the contract. 75 The applicant seeks in the first instance that the contract be voided. Bearing in mind that the contract has come to an end this seems the appropriate course except to the extent of any monies paid to the applicant.

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