Unfair dismissal issues with casual employees

There is a fundamental distinction or dichotomy between the dismissal of a casual employee and the right of an employer to not offer a true casual employee shifts of work. It is often a subtle and and quite difficult legal issue and is illustrated very well in the following extract from a recent unfair dismissal case of the Fair Work Commission.

“CONSIDERATION

[53] At the outset, let me say that there is often a tension between the statutory protections from unfair dismissal (s 384) afforded to a regular and systematic casual employee with the ordinary well-understood rights of a casual employee to refuse casual engagements, and alternatively, the employer’s right not to offer shifts to a casual employee. That is not to say that an employer cannot refuse to offer further shifts (effectively terminating the employment relationship) for poor performance, misconduct or other valid reasons; see: Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371 (‘Selvachandran’). That said, each case will turn on its particular facts and circumstances.

[54] On the other hand, the statutory protections from unfair dismissal afforded to a regular and systematic casual employee must include the full gamut of the matters the Commission is required to take into account under s 387 of the Act, including affording the employee procedural fairness when the employer decides to no longer offer the employee further casual shifts.

[55] However, in this case, the respondent argued that the applicant’s advice to Ms Bobongie that she was only available for very limited casual shifts which, following a workplace restructure, had been filled by permanent employees, meant her actions constituted the initiation by her of the termination of the arrangement to offer her ongoing shifts, in effect an unforced resignation. This action meant the effective initiator of the termination of the employment relationship was not the employer and therefore there was no dismissal and axiomatically, no unfair dismissal. For the reasons which follow, I do not agree.

[56] The meaning of ‘dismissal’ in this context has been considered by the Commission and its predecessor entities over many years. The oft quoted authority as to the meaning of ‘termination at the initiative of the employer’ is that found in Mohazab v Dick Smith Electronics Pty Ltd [1995] IRCA 625; 62 IR 200, where the Full Court of the Industrial Relations Court of Australia said:

‘These definitions reflect the ordinary meaning of the word ‘initiative’. Viewed as a whole, the Convention is plainly intended to protect workers from termination by the employer unless there is a valid reason for termination. It addresses the termination of the employment relationship by the employer. It accords with the purpose of the Convention to treat the expression ‘termination at the initiative of the employer’ as a reference to a termination that is brought about by an employer and which is not agreed to by the employee. Consistent with the ordinary meaning of the expression in the Convention, a termination of employment at the initiative of the employer may be treated as a termination in which the action of the employer is the principal contributing factor which leads to the termination of the employment relationship. We proceed on the basis that the termination of the employment relationship is what is comprehended by the expression ‘termination of employment’: Siagian v Sanel [1994] IRCA 2; (1994) 1 IRCR 1 at 19; 54 IR 185 at 201. In many, if not most, situations the act of the employer that terminates the employment relationship is not only the act that puts in train the process leading to its termination but is, in substance, the entire process. An example would be a situation where the employer decided to dismiss an employee and did so orally or in writing with immediate effect. Other situations may be more complex as exemplified by the circumstances considered by Moore J in Grout v Gunnedah Shire Council (1994) 1 IRCR 143; 57 IR 243 where an employee had given written notice purporting to terminate the employment relationship. The notice was not reasonable but was accepted by the employer which later refused to allow the employee to withdraw the notice. A question arose as to whether that was a termination of the employment at the initiative of the employer and his Honour held it was. His Honour said at 160-161; 259:

‘I have already said that Div 3 concerns termination at the initiative of the employer. The respondent submits that “initiate” means “to begin, commence, enter upon; to introduce, set going, or initiate”: see Shorter Oxford English Dictionary. In this matter, it is submitted, it was the applicant and not the respondent that initiated the termination by writing the letter of 18 May. This, in my opinion, gives the expression “termination” in the Act, read in conjunction with Art 3 of the Convention which speaks of “termination … at the initiative of the employer”, a narrow meaning that was not intended. A principal purpose, if not the sole purpose, of Div 3 is to provide an employee with a right to seek a remedy in circumstances where the employee did not voluntarily leave the employment. An employee may do some act which is the first in a chain of events that leads to termination. An example would be an employee who engaged in misconduct at work which ultimately led to the employer dismissing the employee. However, that situation and the present are not situations where the termination was at the initiative of the employee. In both instances the step or steps that effectively terminated the employment or purported to do so were taken by the employer.’

In these proceedings it is unnecessary and undesirable to endeavour to formulate an exhaustive description of what is termination at the initiative of the employer but plainly an important feature is that the act of the employer results directly or consequentially in the termination of the employment and the employment relationship is not voluntarily left by the employee. That is, had the employer not taken the action it did, the employee would have remained in the employment relationship. This issue was addressed by Wilcox CJ in APESMA v David Graphics Pty Ltd (unreported, Industrial Relations Court of Australia, 12 July 1995, Wilcox CJ). His Honour, at p 3, referred to the situation of an employee who resigned because ‘he felt he had no other option’. His Honour described those circumstances as:

‘… a termination of employment at the instance [of] the employer rather than of the employee.’

And at p 5:

‘I agree with the proposition that termination may involve more than one action. But I think it is necessary to ask oneself what was the critical action, or what were the critical actions, that constituted a termination of the employment.’”

(my emphasis)

[57] In P O’Meara v Stanley Works Pty Ltd (2006) 58 AILR 100 (‘O’Meara’), a Full Bench of the AIRC said:

‘In our view the full statement of reasons in Mohazab which we have set out together with the further explanation by Moore J in Rheinberger and the decisions of Full Benches of this Commission in Pawel and ABB Engineering require that there to be some action on the part of the employer which is either intended to bring the employment to an end or has the probable result of bringing the employment relationship to an end. It is not simply a question of whether “the act of the employer [resulted] directly or consequentially in the termination of the employment”. Decisions which adopt the shorter formulation of the reasons for decision should be treated with some caution as they may not give full weight to the decision in Mohazab. In determining whether a termination was at the initiative of the employer an objective analysis of the employer’s conduct is required to determine whether it was of such a nature that resignation was the probable result or that the appellant had no effective or real choice but to resign.’

[58] It is well established that when an employer is considering dismissing an employee for capacity or conduct, it is incumbent on the employer to warn the employee that their future employment is at risk; see: Crozier v Palazzo Corporation Pty Limited t/as Noble Park Storage and Transport (2000) 98 IR 137 and Swain v Ramsey Food Packaging Pty Ltd [1999] IRComnA 1504. This serves to not only warn the employee of the seriousness of the matter, but provides the employee with an opportunity to properly prepare their explanation or defence as to why they should not be dismissed. This is a requirement under s 387(c) of the Act, and applies no less to a regular and systematic casual employee, who may not be offered any further shifts, and as I said earlier, effectively bringing the employment relationship to an end.

[59] In my view, the evidence established that Ms Bobongie and the applicant had a conversation, recorded by Ms Bobongie in her diary and a post-it note, as to the applicant’s limited availability. It is not materially relevant whether the meeting was 16 or 18 October 2019, as there is no doubt the meeting took place. Ms Bobongie conveyed this information to Ms Bennett and together they decided not to offer her any further shifts after 18 November 2019, stating in the 1 November 2019 letter:

‘… Unfortunately, DAIWS is unable to accommodate the limited shifts that you have recently nominated [and] therefore cannot offer any further casual work after the next roster ceases on the 18th November 2019.’

The letter concluded by thanking her for her contribution to DAIWS and ‘wishing her well for the future’.

[60] In my view, these words are an unequivocal indication of the employer’s intent to effect the termination of the employment relationship. More importantly, however, there was no attempt by Ms Bennett to discuss with the applicant the meeting with Ms Bobongie, or to warn her that her shift availability would lead to the end of her employment. That said, I do not accept that Ms Bobongie concocted her diary notes, or that there was some misunderstanding of the applicant’s intentions. I accept her evidence that she repeated the applicant’s advice back to her and she confirmed it. However, this is not the point. The applicant was not warned of the ramifications of her advice, or given an opportunity to reconsider the advice she gave to Ms Bobongie. I also accept the evidence that there was a business imperative to move to a more permanent cohort of employees replacing most of the casual employees, and that the applicant had at least three opportunities to apply for a permanent position, but declined to do so.

[61] On one view, the resultant circumstances might be said to have constituted a genuine redundancy, amounting to a valid reason for dismissal. However, even if viewed in this context, what actually occurred would not have ‘passed muster’ as to compliance with the consultation provisions under s 389 of the Act, thereby making the dismissal unfair. Nevertheless, I am satisfied that the applicant was dismissed at the initiative of the employer.”

Torres-Carne v Darwin Aboriginal and Islander Women’s Shelter (DAIWS) – [2020] FWC 4080 – 7 August 2020 – Sams DP