Analysis of an unfair dismisal case issues

This extract from an unfair dismissal case decision of the Fair Work Commission contains an excellent summary of the thought process which occupies a member of the Commission when working through the legal issues which impact upon the decision.

“Harsh, Unjust or Unreasonable

[31] I must take into account, in determining whether Ms Miller’s dismissal was harsh, unjust or unreasonable, the matters set out in s 387 of the Act.

Section 387(a) – valid reason related to capacity or conduct

[32] It is necessary to consider whether the employer had a valid reason for the dismissal of the employee, although it need not be the reason given to the employee at the time of the dismissal. 11 In order to be “valid”, the reason for the dismissal should be “sound, defensible and well founded”12 and should not be “capricious, fanciful, spiteful or prejudiced.”13

[33] 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. 14 The question the Commission must address is whether there was a valid reason for the dismissal related to the employee’s capacity or conduct (including its effect on the safety and welfare of other employees).15
(a) Capacity is the employee’s ability to do the job as required by the employer. 16 Capacity also includes the employee’s ability to do the work they were employed to do.17

[34] The appropriate test for capacity is not whether the employee was working to their personal best, but whether the work was performed satisfactorily when looked at objectively. 18

[35] It is not enough for an employer to establish that it had a reasonable belief that the termination was for a valid reason. 19 The Commission must make a finding, on the evidence provided, whether, on the balance of probabilities, the conduct occurred or the performance was satisfactory.20

[36] In cases involving alleged misconduct, a reason for dismissal would be valid if conduct occurred and it justified termination. There would not be a valid reason for termination if the conduct did not occur or it did occur but did not justify termination (because, for example, it involved a trivial misdemeanour). 21

[37] Ms Miller accepted in her evidence that she was critical of YCC in her communications with Emma from Resolute Support on 11 July 2022. That concession was appropriate in circumstances where there is no doubt that Ms Miller described her employer and its approach to the rostering of shifts to care for Ms A as embarrassing, unprofessional and ridiculous. Ms Miller’s conduct in that regard was in breach of her contractual obligations to act in YCC’s best interests at all times, exhibit a professional and courteous attitude, and not make any statement which was reasonably likely to damage the reputation or cause other damage to YCC. 22

[38] It is clear that Ms Miller felt justified in criticising YCC in her discussions with an employee from Resolute Support because she was upset and frustrated at the approach she believed YCC was taking to providing services to Ms A during the one week notice period. Whether or not there was merit in Ms Miller’s concerns, she should have addressed those concerns internally within YCC. By openly criticising YCC to a competitor company, Ms Miller contravened the contractual promises she made when she entered into her employment contract with YCC. Further, Ms Miller should have collected all the relevant facts before concluding that YCC had acted inappropriately. For example, if Ms Peluso had, as stated by Ms Wade, sent an email to Ms A and other relevant people stating the days and times that YCC were providing services that week and Thursday was not on the list, then it would be wrong and inappropriate to be critical of YCC for not organising an employee of YCC to provide care services to Ms A on the Thursday. It follows, in my view, that YCC had a sound, defensible and well-founded reason to terminate Ms Miller’s employment.

[39] That there was a valid reason for Ms Miller’s dismissal weighs against Ms Miller’s argument that she was unfairly dismissed.

Section 387(b) – notification of reason

[40] There is no dispute that YCC notified Ms Miller of the reason for her dismissal in its termination letter dated 14 July 2022. That reason was also communicated to Ms Miller in the letter of allegations sent to Ms Miller on 12 July 2022. The fact that Ms Miller was notified of the reason for her dismissal weighs against Ms Miller’s argument that she was unfairly dismissed.

Section 387(c) – opportunity to respond

[41] YCC did not give Ms Miller an opportunity to respond to the reason for her dismissal. I accept Ms Miller’s oral evidence that she was very unwell on 14 July 2022 and could not participate in the Zoom meeting scheduled for that day. Ms Miller’s evidence in that regard is supported by a medical certificate dated 14 July 2022 and her contemporaneous communications to YCC. 23

[42] YCC’s refusal to reschedule the meeting to a time when Ms Miller was well enough to participate in it meant that she had no real opportunity to respond to the allegations put to her in writing on 12 July 2022.

[43] The fact that Ms Miller was not given an opportunity to respond weighs in favour of her argument that she was unfairly dismissed.

Section 387(d) – support person

[44] YCC did not unreasonably refuse to allow Ms Miller to have a support person present to assist at any discussions relating to her dismissal. Accordingly, s 387(d) is a neutral factor in relation to the question of whether Ms Miller’s dismissal was harsh, unjust or unreasonable.

Section 387(e) – warning about unsatisfactory performance

[45] Ms Miller’s dismissal did not relate to any unsatisfactory performance by her. It follows that s 387(e) is a neutral factor in relation to the question of whether Ms Miller’s dismissal was harsh, unjust or unreasonable.

Section 387(f)&(g) – size of enterprise and dedicated human resource management specialists

[46] At the time of Ms Miller’s dismissal, although YCC was a fairly small employer, it had a human resources manager. In all the circumstances, I am of the view that these factors (s 387(f) & (g)) are neutral in my assessment as to whether Ms Miller’s dismissal was harsh, unjust or unreasonable.

Section 387(h) – other relevant matters

[47] Ms Miller was one of the longest serving employees of YCC. 24 I am satisfied on the evidence that Ms Miller excelled in her duties as a Disability Support Worker, but there were some concerns in relation to her managerial duties and, in August 2019, ensuring that she maintained a professional and courteous attitude at all times.25 On balance, I am satisfied that the length and quality of Ms Miller’s service with YCC weighs in support of her argument that she was unfairly dismissed.

[48] Ms Miller was summarily dismissed by YCC on grounds of serious misconduct. The proportionality of the summary nature of Ms Miller’s dismissal must be weighed against the gravity of her misconduct in respect of which YCC acted in deciding to dismiss her.55

[49] In Sharp v BCS Infrastructure Support Pty Ltd,56 a Full Bench of the Commission discussed the question of whether particular conduct by an employee warranted their summary dismissal as an “other relevant matter” within the meaning of s 387(h) of the Act (references omitted):

“[33] The relevance of the definition of “serious misconduct” in reg.1.07 to the matter is also, with respect, obscure. Section 12 of the Act contains a definition of “serious misconduct” for the purposes of the Act which simply cross-refers to reg.1.07. Apart from s.12 itself, the expression “serious misconduct” is used in only three places in the Act. In s.123(1)(b), a dismissal for serious misconduct is a circumstance in which the notice and redundancy entitlement provisions of Pt 2-2 Div 11 are not applicable; in s.534(1)(b) a dismissal for serious misconduct is one to which the requirements for notification and consultation in Pt 3-6 Div 2 do not apply; and in s.789(1)(b) a dismissal for serious misconduct is one in relation to which the requirements established by Pt 6-4 Div 3 for notification and consultation do not apply. The expression “serious misconduct” is not used anywhere in Pt 3-2, Unfair Dismissal, of the Act. Section 392(3) requires the Commission, in relation to the award of compensation for an unfair dismissal, to reduce the amount that it would otherwise order by an appropriate amount where it is “satisfied that the misconduct of a person contributed to the employer’s decision to dismiss the person”. However, it is clear that conduct may constitute “misconduct” for the purpose of s.392(3) without necessarily being “serious misconduct”. The expression is used in the Small Business Fair Dismissal Code, but that had no application in this case (and it is at least highly doubtful in any event whether the reg.1.07 definition applies to the Small Business Fair Dismissal Code). Reg.1.07 therefore had no work to do in the application of the provisions of Pt 3-2 to the circumstances of this case.

[34] It may be accepted that an assessment of the degree of seriousness of misconduct which has been found to constitute a valid reason for dismissal for the purposes of s.387(a) is a relevant matter to be taken into account under s.387(h). In that context, a conclusion that the misconduct was of such a nature as to have justified summary dismissal may also be relevant. Even so, it is unclear that this requires a consideration of whether an employee’s conduct met a postulated standard of “serious misconduct”. In Rankin v Marine Power International Pty Ltd  Gillard J stated that “There is no rule of law that defines the degree of misconduct which would justify dismissal without notice” and identified the touchstone as being whether the conduct was of such a grave nature as to be repugnant to the employment relationship. “Serious misconduct” is sometimes used as a rubric for conduct of this nature, but to adopt it as a fixed standard for the consideration of misconduct for the purpose of s.387(h) may be confusing or misleading because the expression, and other expressions of a similar nature, have been considered and applied in a variety of contexts in ways which are influenced by those contexts. In McDonald v Parnell Laboratories (Aust) Pty Ltd Buchanan J said:

“[48] The terms ‘misconduct’, ‘serious misconduct’ and ‘serious and wilful misconduct’ are often the subject of judicial and administrative attention as applied to the facts of particular cases but there is relatively little judicial discussion about their content and meaning. Naturally enough, when the term ‘serious misconduct’ is under consideration an evaluation of what conduct represents ‘serious’ misconduct is influenced by the (usually statutory) setting in which the phrase must be given meaning and applied. Frequently, for example, the question at issue is whether an employee is disentitled by reason of his or her conduct to a statutory entitlement (eg. in New South Wales, where Ms McDonald was employed, see Long Service Leave Act 1955 (NSW) s 4(2)(a)(iii); Workers Compensation Act 1987 (NSW) s 14(2).”

[35] In the Decision, the Vice President, correctly, did not attempt to address the parties’ submission concerning “serious misconduct” in the context of his consideration of whether there was a valid reason for the dismissal, but only as a relevant matter under s.387(h). His findings at paragraph [55] and [56] that Mr Sharp’s conduct was “serious misconduct” was, we consider, responsive to the submission of BCS noted in the first sentence of paragraph [52] that “the Applicant’s conduct constituted serious misconduct justifying immediate dismissal”. That is, “serious misconduct” was used as a shorthand expression to described misconduct of a nature that justified summary dismissal. A finding of that nature was a matter which was open to be taken into account as relevant under s.387(h) because it involved an assessment of the seriousness of the conduct in question.”

[50] Although Ms Miller breached her contractual obligations by making comments critical of YCC in her discussions with the Rostering Clerk of Resolute Support, those comments were made on a single occasion to one employee of Resolute Support, not the public at large or a significant portion of it. Further, true it is that Resolute Support was a competitor of YCC, but the two organisations worked co-operatively together in providing the extensive disability support services required by Ms A. Of additional relevance is the fact that the comments were made during the one week notice period given by YCC to Ms A. It follows that Ms Miller’s conduct did not give rise to a risk of ‘losing’ Ms A as a long-term client of YCC. I do not accept YCC’s contention in its letter of termination to Ms Miller that her conduct had the potential to cause a serious and imminent risk to the reputation, viability or profitability of YCC’s business, or that it had the potential to impact in any significant way on harmonious relationships and morale in the workplace. In my assessment, Ms Miller’s conduct on 11 July 2022 was not of such a grave nature as to be repugnant to the employment relationship. Ms Miller’s conduct did not warrant her summary dismissal.

[51] The fact that Ms Miller was dismissed at a time when YCC had been informed that she was sick, could not attend the meeting on 14 July 2022 and would provide a medical certificate after seeing her doctor on that day are relevant matters. Having been informed that Ms Miller was attending a doctor’s appointment on 14 July 2022 and there being no evidence to support a finding that Ms Miller’s illness was not genuine, it was unfair for YCC to refuse to delay the meeting with Ms Miller until she was well enough to participate in it. As a consequence, Ms Miller was not afforded the opportunity to respond to the allegations and provide her side of the story. These procedural deficiencies in the process followed by YCC weigh in support of Ms Miller’s contention that her dismissal was unfair.

Conclusion on harsh, unjust or unreasonable dismissal

[52] After considering each of the matters specified in s 387 of the Act, my evaluative assessment is that YCC’s dismissal of Ms Miller was harsh and unreasonable. There was a valid reason for the dismissal and Ms Miller was notified of the reason for her dismissal, but she was dismissed when she was genuinely ill and unable to attend a meeting to give her response to the allegations made against her. In addition, Ms Miller was summarily dismissed in circumstances where her conduct did not warrant the summary termination of her employment.”

Miller v YCC Group Pty Ltd  (2022) FWC 3098 delivered 22 November 2022 per Saunders DP