Unfair dismissal despite misconduct by employee

There are occasions when the Fair Work Commission will determine that the termination of the employment of an employee is an unfair dismissal despite serious misconduct by the employee if the process followed by the employer was demonstrably unfair, as in this extract from such a case.

“Conclusion

[54] The applicant was summarily dismissed for serious misconduct involving his communications with Mr Laundy on 20 and 21 October 2021. The applicant’s communications with Mr Laundy could not be detached from his role as a Parliamentary Electorate Officer. The applicant’s communications with Mr Laundy would, on any objective and reasonable contemplation, have been likely to have significant detrimental impacts for Senator Keneally (as she then was) and for whom the applicant worked. The applicant’s actions could not realistically be disconnected from his employment. Upon careful analysis, the employer’s findings of serious misconduct have been confirmed.

[55] The misconduct of the applicant which involved his confrontational and threatening communications with Mr Laundy, was misconduct that was plainly inconsistent with the continuation of his employment, and it established valid reason for the dismissal of the applicant. However, the valid reason for dismissal has been assessed and evaluated against significant procedural errors which were evident in the manner that the employer determined and implemented the dismissal of the applicant.

[56] The procedural errors in this case were matters of significance such that the applicant was denied natural justice. Further, the communication of advice of dismissal via email was entirely inappropriate and unnecessarily harsh. In this instance, the particular nature of the misconduct upon which valid reason for dismissal was established must be balanced against the manifest and egregious procedural deficiencies.

[57] On balance, the misconduct in this instance was severe, but equally severe was the injustice occasioned by the deliberate denial of natural justice coupled with the prospect that may have emerged if the applicant’s active bystander obligations (aka MeToo) defence had been heard. Consequently, despite there being valid reason for dismissal, the misconduct of the applicant has not outweighed the significant procedural deficiencies such that findings of harshness and unjustness could be avoided.

[58] Therefore, although the applicant was dismissed for valid reason involving his serious misconduct, the significant procedural defects evident in respect of the determination and implementation of the dismissal of the applicant have rendered the summary dismissal to have been harsh and unjust. The applicant’s dismissal has been found to have been unfair and the Commission must logically consider the appropriate remedy that should be provided in this instance.

Remedy

[59] The applicant has sought a remedy of monetary compensation for his unfair dismissal.

[60] In the circumstances, particularly as the employment of the applicant was irreparably damaged by his serious misconduct, reinstatement would not be an appropriate remedy. Further, in the particular circumstances of this case which involved serious misconduct, the appropriate remedy would logically contemplate potential for reduction of any amount of monetary compensation.

[61] The Commission has determined that compensation would be an appropriate remedy for the applicant’s unfair dismissal, and consideration must therefore be made of the factors which involve the quantification of any amount of compensation.

[62] Section 392 of the Act prescribes certain matters that deal with compensation as a remedy for unfair dismissal. The question of compensation has been approached having regard for the guidelines that have been established in the Full Bench Decisions of, inter alia; Sprigg v Paul’s Licensed Festival Supermarket 5 (Sprigg); Smith and Ors v Moore Paragon Australia Ltd 6 and more recently, the cases of; McCulloch v Calvary Health Care Adelaide7; Balaclava Pastoral Co Pty Ltd v Nurcombe;8 and Hanson Construction Materials v Pericich9 (Pericich).

[63] Firstly, the Commission confirms that an Order for payment of compensation to the applicant will be made against the respondent employer in lieu of reinstatement of the applicant.

[64] Secondly, in determining the amount of compensation that is to be Ordered, the Commission has taken into account all of the circumstances of the matter including the factors set out in paragraphs (a) to (g) of subsection 392 (2) of the Act.

[65] There was no evidence provided which established that an Order of compensation would impact on the viability of the employer’s enterprise.

[66] The applicant had been employed for a total period of about 1 ½ years. The applicant would have been likely to have received remuneration of approximately $1,685.00 per week if he had not been dismissed.

[67] There was clear evidence upon which to conclude that the employment of the applicant would have finalised in accordance with a proper and just contemplation of his misconduct. Consequently, the employment of the applicant would have been likely to have concluded within one week after his unfair dismissal and dismissal would have likely provided payment of 1 weeks’ wage in lieu of notice.

[68] For the purposes of calculation of remuneration that the applicant would have received or would have been likely to receive if he had not been unfairly dismissed, the Commission has considered that the employment of the applicant would have continued for a further one week. Therefore, the total remuneration that would have been received in the notional period of one week following dismissal plus payment in lieu of notice, amounted to a figure of $3,370.00.

[69] The total amount of remuneration received in alternative employment, as identified, and that which may be reasonably likely to be earned between dismissal and the making of the Order for compensation, has been calculated to be $0.

[70] Thirdly, in this instance there was established misconduct of the applicant, and consequently the Commission has decided to make a reduction of 50% to the amount of compensation to be provided to the applicant on account of misconduct.

[71] Fourthly, the amount Ordered does not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt caused to the applicant by the manner of the dismissal.

[72] Fifthly, the amount Ordered does not exceed the compensation cap as prescribed by section 392 (5) of the Act.

[73] Consequently, for the reasons outlined above, taking into account all of the circumstances of the case, and having cognisance so as not to apply the approach taken in the Decision in Sprigg in a rigid, determinative manner, as was cautioned in the Decision in Pericich, the Commission has decided that the amount of compensation to be provided to the applicant should be a gross figure of $1,685.00.

[74] Accordingly, separate Orders [PR743016] providing for unfair dismissal remedy in these terms will be issued.”

Field v Department Of Finance (2022) FWC 1619 delivered 24 June 2022 per Cambridge C