Unfair dismissal; incapacity to do the job

This passage from an unfair dismissal case of the Fair Work Commission deals with the legal issues which are involved for the Commission when determining whether the termination of the employment of an employee was relevantly unfair when based upon the employee’s incapacity to work, sometimes referred to as being unable to meet the inherent requirements of the job.

“Consideration

[14] For a dismissal to be unfair, the Commission must be satisfied that it was harsh, unjust,

or unreasonable (s 385(b)). In considering whether it is so satisfied, the Commission must take

into account the matters specified in s 387.

[15] The Commission is required to consider whether there was a valid reason for the

dismissal related to the person’s capacity or conduct (s 387(a)). A valid reason is one that is a

good and substantiated reason for dismissal. In cases where the reason for dismissal is an

employee’s incapacity for work, the Commission must make findings as to whether at the time

of the dismissal the applicant suffered from the alleged incapacity, based on the relevant

medical and other evidence before the Commission (see CSL Pty Ltd v Papaioannou [2018]

FWCFB 1005, at [50]). I find that at the time of his dismissal, Mr Arora was unable to perform

the inherent requirements of his job as a bus driver. The report from Dr Altaf concluded that

Mr Arora did not currently have capacity for employment. It found that he had a susceptibility

to stressful situations. Dr Altaf’s report noted that it was too early to conclude whether his

condition would ever improve sufficiently to allow him to return to work and that a review in

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two months may shed further light on this. But the report was very clear that Mr Arora was not

fit for duty. I note that Dr Altaf’s report was based on an assessment of Mr Arora on 20 January

2023, a relatively short time before the dismissal. There is no medical evidence before the

Commission to suggest that Mr Arora’s condition changed after that time. In fact, the fourth

medical certificate signed by Dr Kumarasinghe stated that Mr Arora had no capacity for

employment up to 26 February 2023. Further, Mr Arora told Mr Singh on 10 February 2023

that, although he was feeling better, he needed more time to recover. He also confirmed at the

hearing that he was unfit for duty at the time of his dismissal and remained unfit for work.

[16] I appreciate Mr Arora’s frustration at receiving one medical report, from Dr Ghan,

stating that he was fit for duty, and another, from Dr Altaf, stating that he was not fit. However,

it is important to understand that these reports were commissioned by different entities, for

different purposes. Dr Ghan’s report was requested by the company’s WorkCover insurers. The

full details of the claim are not before the Commission; all that is known of the claim is the

content of Dr Ghan’s report, some brief details provided by Mr Arora in his evidence, and the

fact that the claim was rejected. However, it is clear that Dr Ghan, an orthopaedic surgeon,

examined Mr Arora’s physical fitness for duty, not his psychological fitness. Dr Altaf on the

other hand was specifically requested by the company to consider both. He did so. Dr Altaf’s

conclusion that Mr Arora was not fit for duty was clearly based on his assessment of Mr Arora’s

mental health. Dr Ghan’s report provides no basis to question the validity of Dr Altaf’s

conclusion. Mr Arora does not question Dr Altaf’s conclusion either. Rather, he considers it

unfair that Dr Ghan’s conclusion that he was fit for duty appears to have resulted in the rejection

of his WorkCover claim, which he is now appealing. Why Dr Ghan’s examination was

apparently confined to a physical assessment is not clear. In any event, this examination was

requested by the insurer, not the company. I accept Mr Singh’s evidence that he had no

knowledge of Dr Ghan’s report prior to its production by Mr Arora in the course of these

proceedings. I reject the suggestion that the company somehow provided false information to

Dr Ghan. There is simply no evidence to support this notion.

[17] I agree with Mr Arora that his injury appears to be work-related, in the sense that it has

a connection to the incidents that occurred at work in 2016 and 2017. The report of Dr Altaf

appears to recognise that this is the case. I understand why Mr Arora felt aggrieved by the

reference in Mr Singh’s termination letter to his ‘non-work’ injury, but as Mr Singh explained

in his evidence, what he meant by this was simply that he understood that Mr Arora’s

WorkCover claim had recently been rejected. I accept Mr Singh’s evidence that the decision to

end his employment was based on his inability to perform his job as a bus driver. Whether the

cause of the injury was work-related or not, the uncontested fact is that Mr Arora had no

capacity for work. For some two and a half months, he had submitted certificates of incapacity

issued by Dr Kumarasinghe, the most recent one extending to 26 February 2023. He had long

since used all of his accrued personal leave. The fact that Mr Arora was not able to do his job

was a valid reason for dismissal in the circumstances. This weighs in favour of a conclusion

that the dismissal was not unfair.

[18] In considering whether a dismissal was harsh, unjust or unreasonable, the Commission

must take into account whether an employee has been notified of the reasons for dismissal and

afforded an opportunity to respond to any reason related to capacity or conduct (see ss 387(b)

and (c)). Both things occurred in this case. Mr Arora was notified of the reason for dismissal in

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the termination letter. The concerns regarding his capacity were squarely raised with him

beforehand. Mr Arora was given an opportunity to respond, and he did so.

[19] As to the other matters which the Act requires the Commission to consider, the company

did not refuse, unreasonably or otherwise, to allow Mr Arora to have a support person present

to assist in discussions relating to the dismissal (s 387(d)). If a dismissal relates to unsatisfactory

performance, s 387(e) requires the Commission to consider whether the person has been warned

about that unsatisfactory performance prior to dismissal, however the present case concerns

incapacity, not poor performance. The Commission is required to consider the degree to which

the size of the employer’s enterprise, and the degree to which the absence of dedicated human

resources specialists or expertise in the enterprise, would be likely to impact on the procedures

followed in effecting the dismissal (ss 387(f), (g)). These considerations do not raise the bar for

larger employers like the company. They recognise that less may sometimes be expected, in

procedural terms, of small employers. They carry no weight in this case.

[20] In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable,

the Commission is required to take into account any other matters that it considers relevant

(s 387(h)). Mr Arora contended that it was unfair for the company not to have given him more

time to recover and to demonstrate a capacity for work. He said that, if the company had only

waited a few more weeks, it was possible that his doctor would have revised her assessment of

his fitness for duty. He said that the company knew that he was feeling better and would be

seeing his doctor shortly, but stubbornly refused to give him more time. However, in my

opinion, the company’s decision not to give Mr Arora more time was not unfair. Mr Arora had

been absent for nearly three months. None of this time was on paid sick leave. The clinical

opinion of Dr Altaf was very clear and aligned with that of Dr Kumarasinghe. Mr Arora had no

capacity for work. In my assessment, the report of Dr Altaf was pessimistic about his outlook.

In any event, there was no medical evidence before the company on 10 February 2023 that gave

any indication that Mr Arora would have an imminent capacity for work. Although Mr Arora

told Mr Singh that he was feeling better, this did not provide a logical basis to conclude that he

might soon be fit for work, in the context of a protracted absence for reason of medically

certificated incapacity. Mr Arora said at the hearing that the treatment that he had received in

India had been very helpful, however he did not relay this to Mr Singh. When asked by Mr

Singh to provide any relevant information, he submitted a further certificate from Dr

Kumarasinghe, valid until late February 2023, confirming his incapacity for work.

[21] In his materials in reply, Mr Arora submitted a further medical report from Dr

Kumarasinghe, dated 18 March 2023, in which she confirmed that he remained unfit for work.

Also submitted was a report from his psychologist, Dr Kho, dated 3 March 2023. It concluded

that Mr Arora was ‘incapable’ of returning to his pre-injury role, as the thought of returning

triggered intense anxiety, a sense of helplessness and debilitating flashbacks. Both of these

reports appear to be connected with Mr Arora’s appeal against the decision to reject his

WorkCover claim. Mr Arora also acknowledged at the hearing that he remains unfit for work.

In light of this, it appears to me that even if the company had given Mr Arora more time to

recover, it would not have made any difference. Mr Arora submitted that his dismissal by the

company had exacerbated his injury and suggested that he might have been able to recover had

he remained in employment. But although Dr Kumarasinghe’s latest report stated that his

mental health got worse following his dismissal, and Dr Kho stated that his sense of

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helplessness had increased since that time, neither report suggests that if Mr Arora had not been

dismissed, he might already have recovered.

[22] Mr Arora had not exhausted his annual leave, and there appears to have been some

confusion as to whether he was able to take more leave. The company said that its policy is to

allocate annual leave early in the year and if requests are made for annual leave at a later time,

it will allow employees to ‘cash out’ annual leave. It is not clear what practical difference there

is between taking annual leave and cashing out leave in the case of an employee who is already

absent from work for illness or injury. Mr Arora was told that he could not take additional

annual leave; however, I accept Mr Singh’s evidence that a member of his team told Mr Arora

that he could cash out his leave, and that he did not do so. Perhaps the company could have

been clearer with Mr Arora about how to apply to cash out the annual leave. But this matter is

of little significance for the question of whether the dismissal was unfair. I note that although

Mr Arora was not paid his accrued annual leave during various periods of his absence, he

received it as a lump sum payment on termination, as required by the Act.

[23] I do not consider that the company ought reasonably to have afforded Mr Arora further

time to recover, whether on leave without pay, annual leave, or on some other basis. He had

been absent from work for several months. He had exhausted his accrued sick leave. There was

no reasonable basis to expect an imminent improvement in his condition. In my view the

company had been patient with Mr Arora. It had already afforded him a reasonable time to

recover.

[24] I take into account that, including his period of employment with Transdev, which the

company recognised, Mr Arora had nine years of service. I also take into account the economic

and broader personal impact of the dismissal on Mr Arora. However, in all the circumstances,

I do not consider that the dismissal was unfair.

[25] I would note that, even if I had concluded that the dismissal was unfair, I would not have

awarded a remedy. Mr Arora said that his recovery would be assisted if he were to be reinstated,

but in my view reinstatement would plainly have been inappropriate, because Mr Arora has no

capacity for work, and there is no medical evidence suggesting any imminent return.

Compensation would not have been appropriate either, because it appears that Mr Arora has

continued to have no capacity for employment since his dismissal. This would explain the

absence of any evidence from Mr Arora about efforts to mitigate loss by applying for other

jobs. In short, Mr Arora has not lost any earnings as a consequence of his dismissal. Had he

remained employed by the company, he would not have received remuneration because he was

not fit for work.

[26] Finally, I note that at the hearing, the company emphasised that it had had no concerns

with Mr Arora’s performance during his employment, and that should he regain his capacity

for work – which all concerned in this matter no doubt hope for – he would be welcome to

apply for a position as a bus driver.

Conclusion

[27] The company had a good and substantiated reason to dismiss Mr Arora. He was unable

to do his job. The company did not act hastily. Mr Arora was afforded a reasonable opportunity

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to recover. It was not unfair not to give Mr Arora more time. Even if more time had been

granted, I do not consider that it would have made any difference to the ultimate outcome. The

circumstances of the dismissal were not harsh, nor were they unjust or unreasonable. The

dismissal was not unfair. The application is therefore dismissed.”

 

Arora v Kinetic (Melbourne) Pty Ltd [2023] FWC 1125 delivered 11 May 2023 per Colman DP