Collon & Mc Choice Australia Pty Ltd t/as Choice Homewares [2004] NSWIRComm 1037 (3 June 2004)

Last Updated: 28 July 2004

INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

McKENNA C

3 June 2004

Matter No IRC 6347 of 2003

MICHELLE COLLON AND M C CHOICE AUSTRALIA PTY LTD T/AS CHOICE HOMEWARES

Application by Michelle Collon re unfair dismissal pursuant to section 84 of the Industrial Relations Act 1996

DECISION

This is an application made pursuant to s84 of the Industrial Relations Act 1996 in which the applicant, Michelle Collon, alleged that her termination of employment with M C Choice Australia Pty Ltd trading as Choice Homewares amounted to a dismissal which was harsh, unreasonable or unjust. On the hearing of the matter in Gosford on 10 May 2004, the applicant was represented by Ms M Youssofzay, agent, of Employment Help Lawyers. The respondent was represented by Ms S Ma, a manager of the respondent company.

The respondent operates four retail shops trading as Choice Homewares. The applicant was employed by the respondent at a shop located in Erina Fair Shopping Centre. The applicant worked for the respondent on a full-time and permanent basis as a sales assistant between 4 July and 27 October 2003. The short period of employment was apparently without incident, save for the fact that the applicant raised some issues with the respondent about wages one week before her termination of employment. Apparently, when the applicant was recruited she had been promised a pay review after three months' employment. Around the time she had worked with the respondent for three months, the applicant asked for the review she had been promised. The respondent's refusal to entertain a pay review led the applicant to seek advice from the NSW department which deals with pay inquiries (referred to in the proceedings as the Department of Industrial Relations, but now known as the Office of Industrial Relations with the Department of Commerce). As a result of those inquiries, the applicant ascertained that she was not being paid the minimum rate of pay under the relevant award. On 20 October 2003, the applicant, said to be acting on advice from the Department, faxed a letter to the respondent's proprietors or operators, Ken and Shirley Chan. The applicant's letter read as follows:

Dear Ken and Shirley

On behalf of [three named employees] and myself Michelle Collon it has recently come to my attention that your employees of Choice Homewares at Erina Fair are not being paid the correct hourly rate as stated by the Department of Industrial Relations.

By law, I have to give you (7) seven days notice to correct this problem or I will have to notify the Department of Industrial Relations.

We do not want to cause problems for you or your company we just want what we are legally entitled to.

Regards

[signature]

Michelle Collon

That same day, Mrs Chan contacted the applicant about her letter. Mrs Chan apparently challenged the applicant's contention about alleged underpayments and stated to the applicant that she was not doing a good enough job in the shop. A number of further exchanges later occurred about wages until, on 27 October 2003, Mr Chan handed the applicant a letter dated 24 October 2004. The letter advised of the applicant's termination of employment, among other matters, and read:

Dear MICHELLE

Due to our business reason, as you know, our business was very poor for the past few months. The sales even cannot cover the rent, wages and expenses incurred.

Unfortunately, we need to pay a much higher rent for the shop from next month (November 2003). And also, for my personal reason, my arm suffered a serious problem. Under the medical reason, my arm cannot be carried heavy thing before the operation.

We decided I have to stay in the shop most of the time to in charge the shop day to day because we cannot afford a shop assistant to in charge the shop as we need to pay a higher rent next month. We only need a shop assistant when I come to the shop every day, who load all the stock from my Van and also delivery stock to Glendale if necessary. I know this change will be too hard and not very suit to you. That's why we cannot employ you as our full time shop assistant in charge this shop at the moment.

According to the law, this is all your entitlement on this termination of employment:

1. The sum of wages underpaid for 28 July, 2003 To 18 October, 2003

...

2. Annual leave

...

3. Termination Payment

...

4. Employee's Superannuation Contribution

...

In summary, I will give a cheque of $1796.61 for:

- 700.00 Cash

$1096.61 Cheque

1) Last week wage; $436.38

2) The sum of wages underpaid; $312.15

3) Annual leave; $602.08

4) Termination payment; $446.00

Yours faithfully

[signature]

Ken Chan

MC CHOICE AUSTRALIA PTY LTD

[sic]

According to the applicant's evidence, she was present when other staff members made a telephone call to Mr Chan to advise of their impending resignations. The applicant said this call was made on the same day she was handed her termination letter, namely 27 October 2003.

On 28 October 2003, the day after the letter of termination was handed to her, the applicant noticed a new employee working in the shop. On 5 November 2003, the applicant also noticed the respondent had placed an advertisement for new staff in a local newspaper. The advertisement ran for three to four weeks, and read:

BUSY Homeware store at Erina Fair, looking for Junior and Sen staff. Exp. essent. Please fax 1 page resume to: [fax number] Immed start.

The applicant considered that the advice to her about staffing issues and the advertisement were contradictory. Moreover, the applicant considered it unfair that she was dismissed without allowing any consideration of employment alternatives with her, such as part-time work. The applicant considers she was dismissed because she questioned her award entitlements. The applicant stated in her evidence that she had been actively seeking alternative employment, but nonetheless was unemployed for three months following her termination of employment. She seeks 13 weeks' remuneration as compensation.

The respondent's case contended the termination of the applicant's employment related only to business-related, operational requirements. Business had been so poor that sales were not meeting rent, wages and expenses. Moreover, rents had been anticipated to increase in November 2003. Against that background, Mr Chan decided that the business could no longer afford to employ the applicant full-time. In conjunction with Mr Chan's decision to work at the shop, the business could afford to employ only part-time employees. As the shop already employed two part-time employees, a decision was made not to offer part-time work to the applicant as an alternative to her full-time position. Moreover, Mr Chan was of the view that the applicant would not want part-time work, although it is clear he did not seek her views on the matter. Although the applicant gave evidence that, on the day of her dismissal, she had been present when other staff had telephoned Mr Chan to advise of their resignations, Mr Chan's evidence indicated it was two full days later that he was advised of other staff departures - which was the reason why the job advertisement was subsequently placed in the newspaper. No offers of full time employment were made to the new employee/s, not even over the Christmas season. The respondent's case contended there was no unfair dismissal; rather, this was a "normal redundancy". Ms Ma submitted that the respondent did not discuss financial matters concerning rent with the applicant due to commercial sensitivities. In closing submissions, Ms Ma reiterated and reinforced the principal points addressed in Mr Chan's evidence.

Although a witness statement of the applicant was provided broadly in accordance with the directions for hearing, the respondent's materials were not filed in time nor in statement form - and were admitted over the objection of Ms Youssofzay. The hearing of this matter proceeded very quickly and, unfortunately, somewhat unproductively in evidentiary terms. I do not say this in a critical way, given particularly that the respondent's advocate described herself as a manager and English was not her first language nor that of her only witness. Nonetheless, there were various difficulties during the hearing, as there had been earlier in conciliation. For instance, I had occasion to instruct Ms Ma to stop gesturing answers to Mr Chan and to stop pointing to documents when he was being cross-examined by Ms Youssofzay. Despite some of the difficulties during the proceedings, I think it is fair to say the parties' respective cases were confined to limited issues and that those issues were comparatively easy to distil.

As to the matters to be determined, I would conclude as follows. The evidence discloses that the applicant had a short period of employment with the respondent. Around the time the applicant had been employed for three months, she requested a review that had been promised to her. The refusal of the respondent to honour the commitment that had been given in this respect led the applicant to make enquiries concerning wage-related matters. It transpired that the applicant was not being paid her proper, award-based entitlements. The applicant raised this matter, in reasonable terms, with her employer - as is her right and entitlement. The respondent's first reaction, through Mrs Chan, was to deny any underpayment and to criticise the applicant for allegedly not doing a good job in the shop. The applicant maintains she was performing her work satisfactorily and that she had received no prior warnings about any performance-related issues until she raised the issue of award entitlements, and there was nothing in the proceedings to contradict this view.

Despite the contentions by Mrs Chan that no underpayment was occurring, the applicant maintained her position, based on advice from the Department, about the underpayments. The respondent, again through Mrs Chan, offered the applicant advice on how wages were calculated; the applicant then pointed out, correctly as it transpired, that the award relied on by the respondent was outdated. That was the last conversation the applicant held with Mrs Chan before Mr Chan dismissed her. The respondent's proprietors held no discussions with the applicant about the reasons for the dismissal, albeit reasons were given in the letter handed to her.

I preferred the applicant's evidence she was present when other staff telephoned Mr Chan on the date of her dismissal to advise of their own resignations, and find correspondingly in relation to Mr Chan's evidence that he was not aware of impending staff resignations until two days after the applicant's dismissal. There was nothing to contradict the applicant's evidence that a new employee was seen working at the shop on the day following the applicant's dismissal, in circumstances where she had been handed the termination letter at 5.30pm the evening earlier. Moreover, the evidence of the subsequent job advertisements for junior and senior staff was irrefutable.

The time-line is that the applicant raised a legitimate concern about her wages on Monday, 20 October 2003. In the days that followed, the applicant maintained the correctness of the advice that had been given to her by the Department in the face of newly-emergent, performance-related criticisms. By Friday of that same week, namely 24 October 2003, the respondent had prepared a letter of termination, citing operational issues. A week to the day after the applicant had first raised legitimate concerns about award entitlements, she was, at 5.30pm on 27 October 2003, handed her letter of termination. I accept the applicant's evidence that the respondent was already aware of the impending departure of other staff; indeed, to put this in context, a new employee was observed working at the shop the day following the applicant's dismissal. By Wednesday, 5 November 2003, the respondent was running a newspaper advertisement for new staff.

Despite the respondent's contentions about operational considerations and part-time staffing issues, I am satisfied, on the balance of probabilities, that the applicant's employment was terminated for reasons solely or principally attributable to asserting her entitlement to minimum award wages. In those circumstances, the applicant has established a case of harsh, unreasonable and unjust dismissal. As to this finding, I note also the provisions of s210(1)(e) of the Act concerning victimisation because of claiming a benefit under an award. Reinstatement and re-employment are not sought by the applicant, so I turn to the claim for monetary compensation. Following the dismissal, the applicant was unemployed for three months despite actively seeking alternative employment. Taking into account the reasons for, and circumstances of, the dismissal - coupled with consideration of the one week's pay in lieu of notice and, pursuant to s89(6) of the Act, the applicant's unsuccessful attempts to find alternative employment for three months - I have determined that 11 weeks' compensation at the applicant's correct award rate of pay should be ordered.