Unfair Dismissal Case for Two Sisters Settled by Industrial Relations Commission NSW

In a case before the Industrial Relations Commission of NSW, two sisters claimed unfair dismissal from their employer. The Commission found the termination was unfair and awarded monetary compensation to the sisters.

Industrial Relations Commission of New South Wales

CITATION: [NAME] and [NAME] v. [NAME] [2006] NSWIRComm 1017

FIRST APPLICANT [NAME] APPLICANT PARTIES: [NAME]

RESPONDENT [NAME](S): IRC 3941 and 3492 of 2005

CORAM: [NAME]: termination of employment - claim for monetary compensation - conflict in evidence - purported ultimatum by employees' mother - allegation that employees walked out of work - alleged underpayments of wages

LEGISLATION CITED: Industrial Relations Act 1996

Busways v. Johnson (1994) 55 IR 255 CCH Australia Limited v. Bowen (1998) 79 IR 206 CASES CITED: D and R Commercial Pty Limited v. Flood (2002) 113 IR 344 Leeds and Northrup Australia Pty Limited v. Hull (1992) 46 IR 11 [NAME] v. Commissioner of Police (No.2) (2002) 112 IR 212 [COMPANY] v. [NAME] - unreported

HEARING DATES: 02/02/2006

DATE OF JUDGMENT: 02/23/2006

FIRST AND SECOND APPLICANTS unrepresented LEGAL REPRESENTATIVES:

RESPONDENT unrepresented

DECISION: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

CORAM: [NAME], 23 February, 2006

Matter No IRC 3491 and 3492 of 2005

[NAME] and [NAME] and [NAME]

Applications under S.84 of the Industrial Relations Act, 1996

DECISION

[2006] NSWIRComm 1017

Background

1 Pursuant to the provisions of Part 6, Unfair Dismissals, of Chapter 2, Employment [Ss.83 to 90] of the 1996 Industrial Relations Act, two sisters who were employees of [NAME] have lodged applications concerning the alleged unfair termination of their services on Monday, 13 June, 2005, viz:

(i) [NAME], who was employed as a trainee stable hand, rider and strapper for approximately two months; and

(ii) [NAME], who was employed as a stable hand, strapper and rider for approximately one month.

In their Part 6 applications the two employees have sought monetary compensation.

2 The matters were allocated to me and I set them down for a preliminary hearing on Wednesday, 17 August, 2005 and mentions on Thursday, 17 November, 2005 in the [ADDRESS]. [NAME], the owner of the [NAME], attempted to contact me concerning difficulties she had in attending the proceedings on Thursday, 17 November, 2005. I attempted to return her telephone call and left a message on her answering machine concerning her obligations in that respect. She did not appear in the proceedings on Thursday, 17 November, 2005. Nor did the two applicants or their mother, Mrs [NAME], who has represented them throughout the proceedings until 45 minutes after the time set down for the proceedings. By that time I had dismissed the two Part 6 applications for want of prosecution under Rule 146. However, the applicants and their mother did ultimately present themselves and informed me that they had been mistaken over the time actually set aside for the proceedings.

3 I therefore reconvened the proceedings. I had directed the parties into further discussions following the proceedings before me on Wednesday, 17 August, 2005 in which [NAME] had attended. I was informed by the applicants' mother that there had been no discussions and she also claimed that, notwithstanding the relatively short period of employment of the two applicants at the [NAME], there was a substantial claim for underpayment of wages. I had formed the clear impression by this time that any further attempt at conciliation would be fruitless. I set the matter down for a further mention on Thursday, 15 December, 2005 (in Queanbeyan), informing the [NAME] formally of that fact, with the clear intention of moving this matter into arbitration if the matters remained unresolved.

4 That arbitration occurred on Thursday, 2 February, 2006 (in Queanbeyan). [NAME] represented her two daughters in the hearing. She had provided a written statement and she gave evidence in support of that written statement. [NAME] represented herself in the hearing. She had provided no written statements in support of allegations she has made against [NAME]'s daughters but her claims had been set out in her formal response to the two Part 6 applications and I admitted those documents into evidence; [NAME] confirmed their contents in her subsequent evidence given under oath. There is, however, a disturbing conflict in the evidence of [NAME] and [NAME] - and no corroboration for their different version of events. The outcome of this hearing therefore depends on the question of their credibility as witnesses and, essentially which of the two women I believe.

The Evidence

5 It appears that the termination of the services of the two sisters occurred out of a disagreement they had with an acquaintance (Ms [NAME]) who had also been engaged in the stables. The disagreement was of a personal nature which was not really explained in this hearing. [NAME] asserted in her evidence that on Monday, 13 June, 2006 one of [NAME]'s daughters ([NAME]) had been "...playing up...", had refused an order from a foreman at the stables and had left work (in tears because of the conduct of the foreman, according to [NAME]). [NAME]'s other daughter ([NAME]) continued to work on Monday, 13 June, 2006 but allegedly informed [NAME] that if she retained [NAME] in employment she would "...lose two staff..." and she did not resume work at the stables either.

6 [NAME] recorded in her formal response to the Part 6 applications by the two sisters that [NAME] then telephoned the stable and issued an ultimatum that if [NAME] were retained in employment the stables "...won't be seeing my girls any more...". In her evidence in the hearing [NAME] remained uncertain whether she or [NAME] had actually initiated the telephone call. She conceded that she may herself have made the telephone call - and that is [NAME]'s assertion.

7 [NAME] gives a different version of the telephone conversation in the written statement she provided under my directions for the hearing and in her subsequent evidence. She claimed in her written statement that [NAME] telephoned her on Monday, 13 June, 2005 and informed her that neither of her two daughters would be returning to work because "...there was too much bitching with staff and other staff members were telling her different stories...". [NAME] told [NAME], reasonably enough, that there "...were two sides to every story and that she was not being fair..." to her two daughters. [NAME] was surprised by [NAME]'s decision as, she claimed, she had spoken to [NAME] on several occasions and she had always been praising her daughters and their work efforts. [NAME] suggested to [NAME] that a meeting could be arranged to discuss any issues of dispute between the staff members. She claimed [NAME] responded angrily:

"This is not a public service and I don't have time for that sort of crap. Don't tell me how to do my job." And hung up the telephone.

8 On Tuesday, 14 June, 2005 [NAME] again confronted [NAME] at a service station and informed her that her daughters wanted to keep their jobs as they both loved what they were doing in the racing stables. She indicated that they were happy to discuss any issues in dispute. According to [NAME] allegedly replied that they should not bother as she had made up her mind on the matter. That, according to [NAME], was the last word on the subject. [NAME] recalled that meeting with [NAME] and she asserted that she informed [NAME] that her two daughters had terminated their employment themselves. In any event she refused to re-engage them.

Conclusion

9 Some of the argument in these proceedings centres around alleged underpayments to the two sisters. Whilst it is not uncommon for settlements in conciliation of Part 6 applications to also include issues arising from alleged underpayments of wages and other entitlements, such claims may not be addressed in arbitrated Part 6 proceedings. Pursuant to S.380(1):

"An industrial organisation may, during any proceedings before the Commission, make an application for an order under this Part and for the application to be dealt with under S.379."

10 That is a small claim for the recovery of entitlements due to an employee, up to $10,000.00. But as the Full Bench of the Commission (Glynn and Hungerford JJ and [NAME]) confirmed in its unreported decision of Wednesday, 10 February, 1999 in [COMPANY] v. [NAME] [Matter No. IRC 2710 of 1997], an individual dismissed employee in Part 6 proceedings is not able to make such a small claim. Any remedy under Ss.379 and 380 is confined to an "...industrial organisation...", ie a trade union, acting on behalf of its members. As I have consistently informed [NAME], any claim of underpayment of entitlements is a matter that will need to be taken up in the local courts or before an industrial magistrate and I am confined to consider only the question of fairness or unfairness of the dismissal of the two employees in these Part 6 proceedings.

11 That having been said, what must now be established to my satisfaction in what remains of these two Part 6 applications is whether or not the conduct of [NAME] in terminating the services of [NAME]'s two daughters was "harsh", "unreasonable" or "unjust", to use the actual language of S.84(1) [Busways v. Johnson (1994) 55 IR 255 at p.261]. Of course, if the two employees left the employment on their own volition and [NAME] served [NAME] with an ultimatum concerning their return to work, the termination of their employment was their own doing (and that of their mother) and it would not fall under Part 6. In that respect S.84(1) applies only to cases where:

"…an employer dismisses an employee..."

There must be some action by an employer which unilaterally brings a contract of employment to an end and, if [NAME]'s two daughters walked out on the jobs they had at the stables, their Part 6 applications would not be competent.

12 Nevertheless, on balance, I consider that the circumstances described in this hearing are more appropriately categorised as a dismissal rather than a resignation by the two sisters. Whether or not the two sisters walked out or not, it was clear that representations were made by [NAME] for their return. Such evidence as I may confidently rely upon in this hearing suggests that it was [NAME] and not [NAME] that initiated the telephone conversation on Monday, 13 June, 2006; [NAME] is convinced of that fact whilst [NAME] is not so sure. And if [NAME] telephoned [NAME] it is more likely to me that she was telling her that she had terminated the services of [NAME]'s daughters, not receiving any ultimatum from her. [NAME] is adamant in her evidence in this hearing that she made no ultimatum to [NAME] concerning [NAME] and I believe her. I believe that she was doing no more than seeking to intervene to have her two daughters reinstated in employment - and her requests in that respect fell on stony grounds.

13 It seems to me that [NAME] should have made some further efforts to resolve any apparent differences between her staff without taking the final step of dismissing the two employees. As [NAME] has asserted in her written submissions, "...there are two sides to every story..." and some further counselling of all of the staff involved in this internal bickering may have brought this matter to an end without the need for dismissing anybody. As [NAME] is alleged to have told [NAME], she is not a "...public service..." but, by all accounts, [NAME] was satisfied with the work of [NAME]'s two daughters and yet she was prepared to sacrifice them in their employment. I therefore believe she acted unfairly to them.

14 The Commission has consistently reinforced the primary remedy is reinstatement under S.89(1) [Leeds and Northrup Australia Pty Limited v. Hull (1992) 46 IR 11 at p.15, CCH Australia Limited v. Bowen (1998) 79 IR 206 at pp.217 and 218 and [NAME] v. Commissioner of Police (No.2) (2002) 112 IR 212 at p.243]. But, in the circumstances described to me in the evidence, I do not believe that reinstatement is a viable option for [NAME]'s daughters and it is not being sought in any event. Their claims are confined to monetary compensation under S.89(5).

15 The upper limit for monetary compensation is set by S.89(5) as:

"…an amount of compensation not exceeding six months' remuneration of the applicant at the average rate received over the period of six months immediately before being dismissed…"

The Part 6 applications in this hearing must also be considered bearing in mind the provisions of S.89(6), viz:

"When assessing any compensation payable, the Commission is to take into account whether the applicant made a reasonable attempt to find alternative employment and the remuneration that would have been payable if the applicant had succeeded in obtaining alternative employment."

16 Whilst S.89(5) is concerned with loss of income, not any assessment of damages, there remains a certain amount of speculation in determining the appropriate level of compensation. In D and R Commercial Pty Limited v. Flood (2002) 113 IR 344 the Full Bench of the Commission (Wright J - President, Walton J - Vice President and Tabbaa C) alluded to that when (at p.363) it commented that:

"…the power in the Commission to make a money order, subject to the limitation on the quantum of compensation and the matters required to be taken into account by S.89(6), is nevertheless within the Commission's discretion. Whilst the Commission is required to take into consideration the matters identified in S.89(6), those matters are not necessarily to be reflected in any particular, arithmetic or definitive way in the money order for compensation made…"

17 In their Part 6 applications the two employees recorded their average weekly earnings when they worked for [NAME] as respectively $280.15 and $344.00. In the circumstances, having regard to the requirements of Ss.89(5) and (6), the short period of employment for the two sisters, the fact that they are either seeking further education or have obtained further employment, I propose to make the following orders:

O R D E R 1. [NAME] shall pay:

(a) the sum of $700.00 to [NAME]; and

(b) the sum of $925.00 to [NAME]

within 28 days.

2. This order shall take effect on and from Thursday, 23 February, 2006.

[NAME] Commissioner

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