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 Greg Reiffel Consulting works exclusively for employers – acting as a powerful advocate in all areas of Workplace/Industrial Relations and Human Resources Management. (Unfair Dismissals are a speciality). His business grows by referrals. I would appreciate it if you would pass my details on to your colleagues, clients or associates who could benefit from my skill set. Defending/Preventing unfair dismissals, policies and procedures, contracts of employment, codes of conduct and more…

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Introduction

What happens when a client requests that one of your employee’s be removed from its workplace because of aggressive behaviour? They get the maximum award given to them (ie six month’s pay plus superannuation) plus the five weeks’ notice already paid in lieu to the applicant. Plus, the Human Resources department also gets a bake.

Background

The applicant in this matter worked for a large property services company as a cleaner at a school. As mentioned in the introduction, the school contacted the company, requesting that the cleaner be removed. The company complied with the request and, having no other work opportunities, dismissed the cleaner.

The applicant’s case

The applicant, in seeking reinstatement, asserted that:

  • The request for his removal from the school site by the Principal was not a valid reason for dismissal related to his capacity.
  • The alleged “pattern of behaviour” is not a valid reason related to conduct.
  • He did not engage in threatening, harassing or intimidating behaviour towards staff and volunteers as alleged.
  • It is improbable that ISS was contractually required to remove him from its site.
  • Even if the Principal had the power to issue such a direction (which is disputed) the Principal did not do so and simply made a request by email that the applicant be removed.
  • Redeployment opportunities were not sufficiently explored.
  • He was not notified of the reason in sufficiently clear terms nor given an opportunity to respond.
  • It was asserted that if he was dismissed as a result of poor performance, he was not warned about this.

The company’s case

The company’s testimony was that:

  • Its contract with its client allows School Principals to direct the company to remove any of its personnel if they are considered unsuitable.
  • The applicant had previously been removed from another school in December 2015. The valid reason for the applicant’s dismissal is that he was removed from the Casino West Public School at the direction of the client.
  • It did not simply accept the allegations regarding the applicant’s conduct without question but reviewed the allegations regarding the applicant’s conduct and established on the balance of probabilities that the conduct allegedly engaged in by the applicant actually occurred.
  • The applicant was notified of the reasons for dismissal and given an opportunity to respond to those reasons at meetings he attended with a representative.
  • It had been provided with a copy of an involving the applicant and the Canteen Manager and her family.

Case law snippet

I have provided the full case law of this matter at the end of this article. The following is most noteworthy:

“The reality for companies in the business of supplying labour is that they frequently have little if any control over the workplaces at which their employees are placed and the rights of such Companies in circumstances where a client seeks the removal of an employee are limited. However, this is not a basis upon which companies in the business of supplying labour to clients can abrogate responsibility for treating employees fairly when dismissal is the result of removal from a particular site and the fairness of the dismissal is considered with reference to the matters in s. 387 of the Act”.

And:

“…where the dismissal is based on the conduct or capacity of the person who is dismissed. In circumstances where the decision of the client to remove a particular employee is based on objective operational reasons rather than the conduct or the capacity of the employee being removed, validity of the decision to remove the employee from the site does not fall for consideration under s. 387(a) of the Act if the employee makes an unfair dismissal application against the employer”.

The Deputy President finding

  • Any investigation (into the alleged conduct) was cursory to say the least.
  • Assertions made against the applicant were apparently accepted without question.
  • The assertion by the Canteen Manager that she had complained to the Police about the applicant’s conduct was also accepted.
  • That the request of the Principal of the previous school that the applicant be removed from the School was a valid reason for his dismissal in circumstances where the company did not take sufficient steps to independently verify that there were reasonable grounds for the request and did not discuss the matter with the applicant, “much less attempt to put [the applicant’s] side of the story to the Principal.
  • That the Canteen Manager’s complaint (who sought an AVO) was not properly investigated.
  • That no pattern of (poor) behaviour was established by the company against the applicant.
  • There was also a complaint from the applicant’s co-worker:

“If the complaint made by the cleaner…had any credibility then it is surprising that [the co-worker] did not deal with it on the basis that when two persons work together, a threat made by one against the other can impact the workplace”.

  • And: “At best the matters provided a valid reason for a discussion with [the applicant] for the purpose of allowing him to respond to the allegations”.
  • The company made little or no effort to find an alternative position for the applicant.

Was the applicant notified of the reason for his dismissal?

Notification of “the reason” for dismissal relates to the reason for dismissal based on the capacity or conduct of the dismissed person. Notification of the reason must be given before the decision to terminate is made, given in explicit terms and in plain and clear terms. The purpose of the notification of the reason for dismissal is to give the employee an opportunity to respond to that reason and to defend against allegations relating to conduct or capacity. As a Full Bench of the Commission observed in Crozier v Palazzo Corporation Pty Ltd…

“As a matter of logic procedural fairness would require that an employee be notified of a valid reason for their termination before any decision is taken to terminate their employment in order to provide them with an opportunity to respond to the reason identified. [The Act] would have very little (if any) practical effect if it was sufficient to notify the employee and give them an opportunity to respond after the decision to terminate their employment.”

The DP finding:

“[The applicant] was not notified of the reason for his dismissal until after the decision to dismiss him had been made. [The company] had relatively fulsome details of the allegations made against [the applicant] but provided him with only minimal information in circumstances where he needed details in order to respond”.

The Human Resources department cops it again…

The DP:

[The company] has dedicated human resource management specialists and expertise and there is no evidence that the size of the Company impacted or would likely have impacted on the procedures followed in effecting [the applicant’s] dismissal. To the contrary, it would be expected that an employer with dedicated human resource management specialists would have dealt more appropriately with [the applicant]. [My emphasis]

Reinstatement?

The DP (in finding for the applicant):

“Reinstatement is the primary remedy for unfair dismissal. Compensation can only be awarded where the Commission is satisfied that reinstatement is inappropriate. In the present case…is that reinstatement is inappropriate”.

The DP’s reasoning being:

  • The company has a contract to perform cleaning work in Government facilities.
  • The only work which [the company] has available in that area is work under the Contract.
  • The applicant is not able to work outside the [area described].
  • The company signed a contract with its client that the applicant is not to be employed in the described geographical area. Noting that:

“The conduct of managers of [the company] leaves much to be desired in this regard. Essentially material that was highly prejudicial to [the applicant] was sent to the Authorised Person in circumstances where [the applicant] was given no opportunity to comment on that material or to provide his version of events. Further, the conduct of [the company] in sending the material to the Authorised Person after [the applicant] had filed his unfair dismissal application smacks of an attempt to retrospectively justify the dismissal of [the applicant]”.

And more interesting:

“I am also of the view that it is doubtful that the Commission has jurisdiction in relation to an order for reinstatement, to also order [the company] to seek a review of a decision made by the Authorised Person under the Contract. I am certain that the Commission does not have jurisdiction to order the Authorised Person to review or reconsider the determination with respect to [the applicant] much less to withdraw the determination and allow [the applicant] to undertake work covered by the Contract…”

Compensation

In considering what to award the applicant, the DP considered:

  • The applicant’s 25 years’ of employment who has lost his employment in circumstances where he was unfairly dismissed.
  • The remuneration that the applicant would have been likely to receive, but for his dismissal, is $38,004.20 in wages and $3,610 in superannuation contributions.
  • No deduction for contingencies.
  • No deduction on account of a failure to mitigate loss.
  • No deduction for remuneration earned since dismissal.
  • No deduction for income likely to be earned during the period between the making of the order and the actual compensation.
  • No deduction for payment in lieu of notice (which was paid).
  • No deduction for misconduct.
  • The capped amount (ie six months) $19,002.10.

Case law, etc

Valid reason onus on employer

The employer bears the onus of establishing that there was a valid reason for a dismissal. A valid reason for dismissal is one that is “sound, defensible or well founded” and not “capricious, fanciful, spiteful or prejudiced.”

The reason for dismissal must also be defensible or justifiable on an objective analysis of the relevant facts, and the validity is judged by reference to the Tribunal’s assessment of the factual circumstances as to what the employee is capable of doing or has done. The Commission is not limited to the reason given by the employer in considering whether there was a valid reason for the dismissal. Misconduct justifying dismissal is conduct so serious that it goes to the heart of the employment relationship or evinces an intention that the employee no longer intends to be bound by the employment contract.

Misconduct to be viewed objectively

Where the reason for the dismissal is misconduct, the Commission must be objectively satisfied that the misconduct occurred. However, as Vice President Hatcher observed in Bista v Glad Group Pty Ltd, the case law does not establish that a minor failing on the part of an employee could constitute a valid reason for dismissal simply because it was proven to have occurred. Dismissal on such a basis could not be sound, defensible or well founded. His Honour also cited the majority judgement of Moore J in Edwards v Giudice where it was held that:

“The reason would be valid because the conduct occurred and justified termination. The reason might not be valid because the conduct did not occur, or it did occur but did not justify termination. An employee may concede in arbitration that the conduct took place because, for example, it involved a trivial misdemeanour. In those circumstances the employee may elect to contest the termination in the arbitration on the basis that the conduct took place, but it did not provide a valid reason and perhaps by relying on the other grounds in [the section].”

That judgement was relied on by Vice President Hatcher as authority for the proposition that, under the present Act, the consideration of whether there is a valid reason for dismissal requires, where the relevant conduct upon which the dismissal is proceeded is found to have occurred, an assessment of whether the conduct was of sufficient gravity or seriousness such as to justify dismissal as a sound, defensible or well-founded response to the conduct.

Dismissals relating to third party complaints

A number of cases have considered the manner in which the matters in s. 387 of the Act are considered in circumstances where an employer provides labour to a client and the client directs the employer to remove the employee from a site. As a Full Bench of the Commission observed in observed in Donald Pettifer v MODEC Management Services Pty Ltd (Pettifer) labour hire arrangements in which a host employer has the right to exclude a labour hire employee from its workplace, are becoming a common part of the employment landscape in Australia. The reality for companies in the business of supplying labour is that they frequently have little if any control over the workplaces at which their employees are placed and the rights of such Companies in circumstances where a client seeks the removal of an employee are limited. However, this is not a basis upon which companies in the business of supplying labour to clients can abrogate responsibility for treating employees fairly when dismissal is the result of removal from a particular site and the fairness of the dismissal is considered with reference to the matters in s. 387 of the Act.

The consideration in s. 387(a) of the Act in relation to the validity of a reason for dismissal is limited to circumstances where the dismissal is based on the conduct or capacity of the person who is dismissed. In circumstances where the decision of the client to remove a particular employee is based on objective operational reasons rather than the conduct or the capacity of the employee being removed, validity of the decision to remove the employee from the site does not fall for consideration under s. 387(a) of the Act if the employee makes an unfair dismissal application against the employer.

However, where the reason for the removal is the conduct or capacity of the person being removed and the result of the removal is the termination of an employee’s employment, an employer may be required to establish on the balance of probabilities that the conduct of the employee which led to the removal occurred. It may also be sufficient that the employer took reasonable steps to investigate the alleged conduct and to engage with its client where there is doubt that the conduct occurred or that it warranted removal from the client’s site. I accept that the reality is that such an investigation may place a company in the business of supplying labour in a difficult position with its client and that a supplier of labour cannot insist that a client alter a decision to remove a particular employee or allow a particular employee to access its premises in circumstances where the client refuses to do so.

Despite these difficulties, I am also of the view that where an employee who has been placed in the premises of a third party has been dismissed for reasons related to conduct, the employer of that person must have at least taken reasonable steps to investigate whether the conduct occurred and a failure to do so cannot be excused by the fact that a client formed the view that the conduct had occurred and that view was accepted by the employer without question. Where there is such a failure the result may be that the Commission is unable to be satisfied to the required standard that there was a valid reason for dismissal. {my emphasis]

The matters in s.387 go to both substantive and procedural fairness and it is necessary to weigh each of those matters in any given case, and decide whether on balance, a dismissal is harsh, unjust or unreasonable. A dismissal may be:

Harsh – because of its consequences for the personal and economic situation of the employee, or because it is disproportionate to the gravity of the misconduct;

Unjust –because the employee was not guilty of the misconduct on which the employer acted; and/or

Unreasonable – because it was decided on inferences that could not reasonably have been drawn from the material before the employer.