Louise Nesbitt v Dragon Mountain Gold Limited. (U2014/285) [2015] FWC 779. COMMISSIONER CLOGHAN. 26 MARCH 2015

 

This matter caught my interest because it resulted in three formal hearings in relation to the dismissal of an employee from a small business:

Firstly[1], the employer attempted to argue (unsuccessfully) that the FWC did not have the jurisdiction to deal with the matter due to the applicant’s contract of employment contained the following clause:

 

“10. ARBITRATION

 

10.1 In the event of any dispute arising as to the validity of any termination of this agreement and failing resolution of the dispute within twenty-one (21) days of the dispute arising, the parties agree to appoint an arbitrator, or failing agreement as to the person to be appointed arbitrator, an arbitrator will be appointed at the request of either Party by the President for the time being of the Law Society of Western Australia. The submission to arbitration is deemed to be a submission to arbitration within the meaning of the Commercial Arbitration Act 1985. The arbitrator must agree to hear the arbitration and hand down his decision within thirty (30) days of his appointment as arbitrator. The award of the arbitrator will be final and binding on the Parties and any right of the parties to appeal under Section 38 of the Commercial Arbitration Act or to apply to the court under Section 30 of the Commercial Arbitration Act are hereby expressly excluded.

 

10.2 The arbitrator shall assess the fairness or unfairness of the termination which precipitated the dispute and in so assessing the fairness or unfairness of such termination shall take into account the written submissions of each Party, the terms of this agreement and he will be at liberty to seek legal advice before exercising his judgement as an expert pursuant to this clause.

 

10.3 The cost of the arbitrator will be borne by the company if the dispute is resolved in favour of Employee or by Employee if the dispute is resolved in favour of the Company.”

The Commissioner (quite correctly in my humble) found:

“The fact that Ms Nesbitt is employed in a commercial undertaking does not mean that her relationship with the owners is “commercial”. Ms Nesbitt’s contractual relationship is an employment relationship, or to put it in the anachronistic vernacular, “master and servant”. The relationship is non commercial.”

And subsequently decided: “…The FW Act takes precedent over…the employment agreement”.

Secondly[2], the employer attempted to argue that the applicant “abandoned her employment”. This argument failed, however the FWC found that in finding the dismissal did occur it was not unfair, mianly due to the business being a mall employer and testing the matter against:

  • Pinawinv Domingo [2012] FWAFB 1359; and
  • Narong Khammaneechanv Nanakhon Pty Ltd ATF Nanakhon Trading Trust T/A Banana Tree Café.

By way of background, the Employer is listed on the Australian Stock Exchange and operates as a mineral exploration company. Ms Nesbitt was employed as an Office Administrator/Bookkeeper. Ms Nesbitt arranged for plumbing work to be carried out, as part of the refurbishment of the Employer’s office. The plumbing work was to be carried out by her daughter’s boyfriend, Mr Robert Guy.

Ms Nesbitt sent a text message intended for Mr Guy but actually sent to Mr Gardner (her boss), in which she describes Mr Gardner as “a complete dick”. Further, the text message states “… we know this already so please try your best not to tell him that regardless of how you feel the need …”

Having realised that she had sent the text to the wrong person, Ms Nesbitt sent a text message to Mr Gardner which reads, “Rob [Mr Gardner] please delete without reading. I am so so so sorry. Xxx”.

Ms Nesbitt subsequently sent a further text message to Mr Gardner which reads,

“Rob I need to explain … that message came across so wrong. Rob … that is not how I feel. My sense of humour is to exaggerate. It is not how I feel. That was a joke within our family … Robby [Mr Guy] has a little problem very occasionally mouthing off some time and it was no more than a joke exaggerating both the issues. Yes I do feel that my ideas are all ignored but that’s ok it’s not my building and all I can do is put forward suggestions and hope one or two get implemented. Rob…that it is not how I feel … It is so far out of context … Please forget it and just go on as normal. I am very very sorry. It is not how I feel”

In deciding the matter, the Commissioner found that it was the text message which led to Ms Nesbitt’s dismissal:

“I do not accept Ms Nesbitt’s submission that I should consider the text message to her boss, in the context of the recipient it was meant for [Mr Guy], or that she lives with young people who put “complete” “in front of every second word”.

“In my view, Ms Nesbitt was, in colloquial terms, sharing her assessment of Mr Gardner, Chairman and Managing Director of her employer, to the boyfriend of her daughter.

“To call a person a “dick” is a derogatory term to describe them as an idiot or fool. The word “complete” is used to convey the message that the person is, without exception, an idiot or fool – they are nothing less than a “dick”.

 

 

“Clearly, the working relationship between Ms Nesbitt and Mr Gardner had deteriorated in the months after the relocation to Claisebrook. I agree with the Applicant that the situation was “serious”. It was serious because the working relationship was attended by allegations of accounting errors, allegations of Ms Nesbitt not attending work and choosing to work from home, failure to update the Employer’s website, and failure to process Company documents in a timely manner. Mr Gardner’s evidence was that there was a breakdown in their professional relationship.”

The Commissioner then commented:

“Trust and confidence is an essential element in any employment relationship. In this case the employment relationship stripped to its barest, consisted of two people; the Chairman and Managing Director and Ms Nesbitt. Further, it is an employment relation where the Chairman and Managing Director spends most of his time interstate or overseas and Ms Nesbitt is “in charge” on a daily basis. This is not a situation of a large employer with thousands of employees and an employee many layers removed from the “boss”. In my view, the issue of trust and confidence is far more acute when consideration is given to the closeness of the employment relationship. With two people in the employment relationship and one absent for significant periods of time, trust and confidence is an absolute necessity”.

Finding:

“I am satisfied that, at the time of the dismissal, the Employer held a belief that Ms Nesbitt’s conduct was sufficiently serious to justify summary dismissal. Further that that belief was based upon reasonable grounds.

Thirdly[3] Ms Nesbit appealed this finding on some six grounds. However, this was not enough to enliven the public interest and the appeal was subsequently dismissed.

[1] Ms Louise Nesbitt v Dragon Mountain Gold Limited. (U2014/285) [2014] FWC 5383. CLOGHAN, C. 11 AUGUST 2014.

[2].

[3] Louise Nesbitt v Dragon Mountain Gold Limited. (C2015/802) [2015] FWCFB 3505. HATCHER, VP, KOVACIC, DP, JOHNS, C. 12 JUNE 2015.

Greg Reiffel Industrial Relations & Human Resources Consulting has been providing the following services to businesses for over 30 years:

 

  • General HR and IR advisory service.
  • Fair Work Commission representation (eg unfair dismissals, adverse actions, etc.).
  • Workplace investigations and mediations.
  • Policies and procedures.
  • Discipline & Termination.
  • People Audits (are you at risk of prosecution?).
  • Enterprise Agreements, Contracts of Employment, Individual Flexibility Agreements.
  • On-site HR services.

Contact Greg on 0438 906 050 or mailto: greg@gregreiffelconsulting.com.au.