Key Points:

Employers face a high bar when deciding to dismiss an employee for misconduct.

An employee sacked for telling a co-worker to "go and punch [another co-worker] in the face" has been awarded $21,000 compensation by the Fair Work Commission (Davidson v Visa Global Logistics Pty Ltd [2015] FWC 7332).

This case highlights that employers continue to face a high bar when deciding to dismiss an employee for misconduct. Before terminating an employment relationship, employers should ensure that they have a well-founded and defensible reason.

Ms Davidson expresses her views about Stacey

Ms Davidson's employment with Visa Australia was terminated following an incident where she allegedly said to a co-worker over the phone, "can you go and punch Stacey in the face".

Visa Australia issued Ms Davidson with a "show cause" letter, which also referred to a previous written warning for "yelling and swearing" at a fellow employee. Under cross-examination, Ms Davidson admitted that she had called her fellow employee a "fu***ing c**t".

While Ms Davidson maintained that her "punch in the face" remark had been taken out of context, was meant as a joke, and apologised nonetheless, Visa Australia dismissed her for breaching its Anti-Discrimination and Harassment Policy.

In deciding whether Ms Davidson was unfairly dismissed within the terms of section 385 of the Fair Work Act 2009, Deputy President Lawrence considered whether the dismissal was "harsh, unjust or unreasonable". In concluding that the dismissal was unfair, he made the following findings.

There was no valid reason for Ms Davidson's dismissal

Deputy President Lawrence accepted on the balance of probabilities that Ms Davidson's request "can you go and punch Stacey in the face" was "meant as a joke", albeit one that could be misunderstood. On the evidence, there was no real threat of violence or act of intimidating behaviour, because the words were spoken to a third person, Mr Pilgrim, who then reported them to Stacey. While Stacey reported feeling intimidated by Ms Davidson's comments, this was wholly based on Mr Pilgrim's account the next day, which seemed to have shifted somewhat. It was therefore determined that there was no breach of the company's Anti-Discrimination and Harassment Policy.

Deputy President Lawrence also remarked that the previous written warning issued to Ms Davidson (to which the "show cause" letter referred) was not justified, because it referred to a workplace conflict in which Ms Davidson was the only employee to be disciplined: "While [Ms Davidson's] language may have been intemperate, in the context of this workplace, it is hard to see it justified a formal warning to her alone." The Fair Work Commission was satisfied that the disciplinary action taken against Ms Davidson was due to a breakdown in the relationship between her and the company's National Transport Manager.

The company failed to give sufficient weight to Ms Davidson's substantial length of service

In Deputy President Lawrence's view, Visa Australia failed to give sufficient weight to Ms Davidson's substantial length of service (she had been employed with Visa Australia for 8 years) which saw her promoted to a supervisory role in a challenging work environment.

Aside from the two instances of workplace conflict discussed in the case, there was no challenge made to Ms Davidson's work record.

Dismissal was an inappropriate sanction for Ms Davidson

Even if "the worst interpretation" was taken of Ms Davidson's conduct, there were a raft of other sanctions which Visa Australia could have applied, which were "less severe and more appropriate" than dismissal.

Compensation, not reinstatement, the right remedy

Having found that the dismissal was unfair, and that reinstatement was not appropriate in all the circumstances (Ms Davidson did not seek reinstatement, and it was not be appropriate given the difficult relationship between Ms Davidson and her Manager), Deputy President Lawrence ordered the company to pay Ms Davidson $21,000 in compensation. This figure reflected Ms Davidson's annual salary of $109,000, the likelihood that had she remained employed with Visa Australia she would have been dismissed after six months (given some other difficulties she had with the company's National Transport Manager and other employees), and that Ms Davidson had since obtained another job that paid $60,000 a year.

What can we learn from this case?

While it is, to state the obvious, probably never a great idea to joke about punching someone in the head, this case demonstrates that employers continue to face a high bar when deciding to dismiss an employee for misconduct. The employer should have a well-founded and defensible reason for terminating the employment relationship; comments which do not constitute "an actual threat of violence", for example, might fall short of misconduct.

It is also important for employers to implement disciplinary procedures consistently across their workforce. Here, a purported reliance on a previous warning given to an employee for using offensive language was not justified, because the employee was the only one disciplined, despite there being a workplace conflict; it takes two to tango.

Employers must be careful not to dismiss workers on unsubstantiated grounds; the evidence must be solid. If they do, the Fair Work Commission may well deem the termination a sucker punch.