Can dismissing an employee with a valid reason still be unfair, unjust, or unreasonable?

Shane Harman v Joe Harkin as trustee for the Civil Labour (NSW) Trust [2021] FWC 1220

 

Mr Shane Harman (the Applicant) had been employed as an operator/truck driver for 18 months by Joe Harkin as trustee for the Civil Labour (NSW) Trust (the Respondent) before his employment was terminated. The Applicant contended he was unfairly dismissed, and the Respondent contended that the Applicant resigned or abandoned his employment. The FWC found in favour of the Applicant.

Facts

Throughout the Applicant’s employment, the Applicant had made repeated requests for his payslips, which all other employees of the Company received by email. The Applicant did not have an email address and had requested for hard copies of his payslips but the Respondent repeatedly failed to provide them to him.

On 25 August 2020, the Applicant met with the Operations Manager and Batcher of the Company. One of the owners of the Company (the Owner) participated in the meeting by phone. The Applicant asked for his payslips to be provided to him. The Owner told the Applicant that he had already received them. The discussion continued and the Applicant raised his voice and stated that he had not received the payslips. The Applicant gave evidence that the Owner called the Applicant a ‘liar and a moron’, after which the Applicant stood up, swung around and knocked his fist into the plasterboard wall of the lunchroom. The Owner, who was not available to give evidence in the hearing, claimed that the Applicant stormed out of the room and said that he quit and would not be returning. The Applicant denied saying this. The Applicant claimed instead that the Operations Manager told him that he was not in the right ‘head space’ and should go home for the day, to which the applicant replied that he was stressed and was going to see his doctor. The FWC accepted the Applicant’s evidence.

On 25 August 2020, after the meeting, the Owner sent a text message to the Applicant, advising him that his final pay advice would be sent to him later that week and noted that he had to be advised by text message because he “refused to answer” her teleconference calls. The Applicant submitted that no one had tried to contact him, and the FWC accepted his evidence.

On 26 August 2020, the Applicant obtained a medical certificate that stated he was unable to attend work from Wednesday 26 August 2020 to Friday 28 August 2020.

The Applicant returned to work on 1 September 2020 but was told by the Operations Manager to wait in the parking area and approximately 30 minutes later, the Operations Manager returned to advise him that he is no longer employed by the Company. Later that day, the Owner sent another text message to the Applicant stating that he quit the week prior, and his employment had therefore ended.

Issues

  • Was the Applicant dismissed?
    • Did the applicant resign or abandon his employment?
    • If not, was the Applicant dismissed at the Respondent’s initiative?
  • If the Applicant was dismissed, was the dismissal harsh, unjust, or unreasonable?

Law

Section 386 of the Fair Work Act 2009 (Cth) (FW Act) sets out the meaning of ‘dismissed’:

(1)  A person has been dismissed if:

(a)  the person’s employment with his or her employer has been terminated on the employer’s initiative; or

(b)  the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.

Section 385 of the FW Act sets out what is an unfair dismissal:

A person has been unfairly dismissed if FWA is satisfied that:

(a)  the person has been dismissed; and

(b)  the dismissal was harsh, unjust or unreasonable; and

(c)  the dismissal was not consistent with the Small Business Fair Dismissal Code; and

(d)  the dismissal was not a case of genuine redundancy.

(emphasis added)

Decision

Was the Applicant dismissed?

Despite the Owner’s claims, the FWC did not accept that the Applicant said anything to suggest that he was resigning from his position on 25 August 2020, and found the medical certificate provided by the Applicant to be strong evidence to support the Applicant’s version of events, being that he left the workplace because he was stressed. The FWC found instead that the employment was terminated on 1 September 2020, at the Respondent’s initiative, when the Operations Manager advised him that he was no longer an employee of the Company and asked him to leave.

Was the dismissal harsh, unjust, or unreasonable?

Deputy President Saunders found that the Respondent had a valid reason to terminate the Applicant’s employment by reason of the Applicant punching the wall and damaging it. The Deputy President noted that the Applicant was rightly frustrated and while he did not yell, abuse, threaten, or curse at anyone, as was claimed by the Respondent, his conduct gave the employer a well-founded reason to terminate.

The FWC found that the Applicant was not notified of the reason for this dismissal, or given an opportunity to respond, because the Respondent had wrongly assumed the Applicant had abandoned his employment. Deputy President Saunders referred to a number of mitigating factors that he considered relevant to his assessment of the Applicant’s conduct. In particular, he noted that the Applicant was justifiably frustrated and angry at the Respondent for having consistently refused to provide him with payslips. In addition to this, the Owner had called the Applicant a liar and a moron, which the FWC called ‘inappropriate’ as the Respondent had failed to comply with their legal obligation to give the Applicant payslips.

Despite the Respondent having a valid reason to terminate, the FWC held that, due to its own conduct in failing to comply with its obligations to give the Applicant his payslips and for not affording him procedural fairness, the Applicant had been unfairly dismissed.

The Take Home

The employer in this scenario mistakenly assumed that the employee had abandoned their position and had therefore not gone through the necessary procedure for termination. Even with a valid reason for termination, the FWC will find a dismissal to be unfair under section 385 of the FW Act if the employee has not been afforded procedural fairness. In this case, the employer’s failure to provide the employee with his payslips only aggravated the finding that the employee’s termination was unfair. The FWC and Courts take this matter very seriously. Employees rely on receiving their payslips in order to be able to verify that they are being paid their correct entitlements. It is equally a safeguard for employers to ensure that any underpayments made by mistake or oversight are brought to their attention and rectified as soon as possible, before the Fair Work Ombudsman, the FWC, or a Court has to get involved.