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Work Place Legal FOR MENTION 65
April/May 2016

Unfair Dismissal - Minimum Employment Period

A recent appeal to the Fair Work Commission Full Bench (“FWCFB”), Senaratne v King & Wood Mallesons [2016] FWCFB 420 has highlighted the importance of minimum employment periods when it comes to lodging Unfair Dismissal applications at the Fair Work Commission (“FWC”). The details of the original case prior to appeal are as follows:

  • Ms Tara Senaratne (“Ms Senaratne”) commenced employment with King & Wood Mallesons (“KWM”) on 2 February 2015 on a 3-month probationary basis.
  • On 23 April 2015, an employment review was conducted and Ms Senaratne was informed that her performance was not up to standard and that her probation would be extended for a further 3 months until 31 July 2015.
  • Ms Senaratne was also informed that if her performance did not improve, KWM reserved their right to terminate her employment with the provision of one month’s notice.
  • On 29 July 2015 Ms Senaratne was informed that her employment with KWM would be terminated due to poor performance and that she would be allowed to work out her notice period at KWM.
  • Ms Senaratne’s employment at KWM ceased on 21 August 2015 where her remaining notice period was paid out in lieu.

Ms Senaratne sought relief from the FWC by way of an Unfair Dismissal application against KWM on the basis that her dismissal was “harsh, unjust or unreasonable”.

The matter came before FWC Deputy President Gooley, who found that the FWC did not have the jurisdiction to hear the claim because Ms Senaratne had not fulfilled the 6-month minimum employment period requirement to be eligible to file such an action, and the matter was dismissed.

Ms Senaratne appealed Deputy President Gooley’s decision indicating that she was unhappy with the process and procedure that KWM took in her dismissal.

The FWCFB dismissed Ms Senaratne’s application for permission to appeal citing the following reasons:

  • The establishment of the FWC’s jurisdiction by Deputy President Gooley to deal with this matter was not a discretionary decision.
  • The application for leave to appeal was not based on an error of law or mistake in the fact in the decision of Deputy President Gooley.
  • No argument is taken with the Deputy President’s conclusion that the Commission was without jurisdiction to deal with the application as the minimum employment period had not been completed.

Lessons for Employers

During the course of the minimum employment period i.e. 6 months (or 12 months in the case of small business employers), employers are expected to decide whether the employee in question is a suitable fit for the organisation; and if they are not, termination with the provision of the appropriate notice is possible without the fear of an Unfair Dismissal claim being successfully made against the employer.

Please note that there is no period of minimum employment for the lodgement of a General Protections application.

For further advice and assistance, contact Workplace Legal at 03 9972 4950

Adverse Action and Fixed Term Contracts

Don’t ignore employee issues just because a fixed term contract is about to expire.

Crawford v Steadmark Pty Ltd (No2) [2015] FCCA 2697

A recent decision of the Federal Circuit Court highlights that employers should not ignore any issues an employee may raise just because their fixed term contract is about to expire.

In the case of Crawford v Steadmark Pty Ltd, Ms Crawford was employed as a Store Manager for Steadmark, which operated lingerie stores throughout Australia under the names of Simone Perele and Betty McDowell. Ms Crawford was engaged on a six month fixed term contract, which contained an option to extend the term. 

During Ms Crawford's employment, her performance as Store Manager was strong and she received a bonus in three consecutive months during her employment. Ms Crawford reported directly to Ms Vanessa Galina, the National Retail Manager and also to Mr Michael Rosenfeld, the Managing Director.

A month before Ms Crawford's contract was due to expire she attended a work function for Store Manager’s with Mr Rosenfeld. Ms Crawford stated that Mr Rosenfeld sat down next to her, brushed his leg against hers, and asked Ms Crawford to meet with him outside of work to discuss her plans for the business. After he repeated this request a few times, Ms Crawford stated that she politely declined his advances and let him know that his conduct was inappropriate.

The following afternoon, Ms Crawford called Mr Rosenfeld to provide the store's figures for the day. Mr Rosenfeld allegedly said "Thanks very much for that, now that you have ruined my night you little slut". Ms Crawford was upset, and emailed Ms Galina to let her know that due to Mr Rosenfeld's behaviour, she would not be attending a work function that night. Ms Galina responded later that day, saying that she wasn't sure what had happened but that they would discuss it tomorrow. Ms Galina never followed up the email with Ms Crawford, and never discussed the email as promised, despite Ms Crawford’s attempts to follow up the email over the next few weeks.

Ms Galina made arrangements to speak with Ms Crawford on the day prior to the expiry of her contract. On the day of the meeting, Ms Crawford called in sick. The day after the contract expired, Ms Galina sent Ms Crawford a letter advising that her contract would not be renewed due to her unsuitability for the role.

Ms Crawford brought a claim for adverse action, alleging that she was dismissed and/or her employer refused to employ her (after her contract expired) because she had exercised her workplace right to make a complaint.

The Employer disputed Ms Crawford’s claims but admitted that they refused to employ Ms Crawford after her contract had expired, not because she had made a complaint but because she was unsuitable for the role.

In relation to whether Ms Crawford was dismissed, the Court held that Ms Crawford’s contract expired by the effluxion of time and accordingly, she was not dismissed from her employment by the Respondent.

However, the Court found that the decision not to re-employ Ms Crawford was adverse action, and that Ms Crawford's complaint about Mr Rosenfeld was one of the reasons why she wasn't re-employed. The Court therefore found that Ms Crawford had made out her adverse action claim, and was entitled to up to six months' pay as compensation.

Lessons for Employers

  • If you have an employee on a fixed or maximum term contract which is due to expire, you should speak to the employee and either confirm that the contract will expire, or discuss extending it before the contract expires. If you fail to have these discussions before the contract expires, it will allow your employee to argue that a new contract was formed or the old contract was extended.
  • Irrespective of the stage or nature of employment, if an employee raises an issue during the course of their employment, you should acknowledge and deal with it according to your organisations policies and procedures. For example, if an employee is on probation and makes a complaint, the complaint should be dealt with promptly and not ignored on the basis that their employment could end prior to the end of the probationary period. If you fail to do this, an employee could argue that you decided not to extend the contract or continue employment past the probationary period because of the complaint.

For further advice and assistance on fixed term contracts and adverse action, please contact Workplace Legal at 03 9972 4950

Unfair Dismissal - Make Sure The ‘Valid Reason’ Is Supported By The Evidence

In the case of Mulhall v Direct Freight (Qld) Pty Ltd [2016] FWC 58, the Applicant was terminated summarily for serious misconduct.

The Applicant had been employed by the Respondent as a pick-up and delivery driver for almost 3 years when he was accused of stealing a box, containing a laptop computer, at the Respondent’s depot, when it failed to arrive at its intended destination.

The Applicant denied the allegations against him.  Nevertheless, the Respondent made the decision to terminate the Applicant’s employment.

In reaching the decision to terminate the Applicant’s employment, the Respondent compared photographs of a box similar to the missing box with boxes seen on two CCTV videos. The Respondent formed the view that the footage showed evidence of the Applicant handling the missing box and failing to scan it as he had other boxes. Further, the Respondent concluded that the Applicant looked in the direction of the CCTV cameras whilst doing so.

In the Fair Work Commission (‘the Commission’) hearing, the Applicant submitted that the box identified by the Respondent in the CCTV footage as being the missing box did not match the box in the photographs on the basis that the distinctive markings apparent in the photographs of the box could not be seen in the footage. After reviewing the evidence, the Commission accepted this.

Accordingly, the Commission determined that the Respondent lacked a valid reason for the dismissal of the Applicant. Further, the Commission found that the failure of the Respondent to show the Applicant the CCTV footage amounted to a denial of procedural fairness, both of which made the dismissal unfair. The employee was awarded compensation.

Lessons for Employers

Employers must be satisfied they have sufficient evidence of misconduct on the part of an employee, capable of withstanding the scrutiny of the Fair Work Commission, before making a decision to terminate. Further, it is important that employers give employees an adequate opportunity to respond. In this case, the employee was given details of the allegations against him, but he was not permitted to see the CCTV footage that was relied upon to terminate him. It is possible that the employee would have been able to explain away some or all of the factors the employer relied upon in deciding to terminate him – but he was not given the opportunity to do so.

For further advice on and assistance on unfair dismissals, please contact Workplace Legal on 03 9972 4950.

Suite 101, 88 Albert Road
South Melbourne VIC 3205
tel 03 9972 4950
fax 03 9923 6441

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