A small business retailer that summarily dismissed a regular casual employee via text message has been ordered to pay the employee almost $10,000 in compensation by Fair Work Australia.

Implications for employers

Employers should be aware that not having face to face contact with an employee prior to dismissing them (so as to provide the employee with an opportunity to respond) will, in most cases, expose the employer to the risk of a successful unfair dismissal claim (assuming the employee has access to that regime).

In addition to the procedural fairness requirements under the unfair dismissal regime, employers must also have a valid reason for dismissing an employee (with appropriate evidence to support that reason).  The fact that an employer may be able to rely upon the Fair Dismissal Code does not alleviate them of these responsibilities.

Background

The applicant was employed by the respondent, Modestie Fashion Australian Pty Limited, as a casual retail shop assistant in December 2008.  The respondent operated 2 retail clothing stores in Sydney. The applicant was employed by the respondent on a regular and systemic basis.  The business was sold at the end of December 2010.  However, the applicant continued to work for the new employer on a casual basis.

On 23 December 2010, the applicant commenced work at 9am and worked an extended shift until 12 midnight.  She was rostered to commence work again at 9am on the following day, 24 December.  The applicant arranged a shift swap with a co-worker for the following day.  This involved the applicant commencing at 11am and her co-worker commencing at 9am instead of her rostered 11am start.  The applicant did not inform the respondent of the shift swap.

The applicant’s co-worker commenced work at 9am by herself and opened the store.  A short time later, and unbeknown to the co-worker, 25 items of clothing worth in excess of $5,000 were stolen from the shop.  When the applicant arrived at 11:30am she discovered the theft and informed the respondent. The applicant then worked the remainder of her shift.

On 26 December 2010 the applicant was dismissed via text message from the respondent.  The text message stated as follows:

“Sedina, I have let you go for 2 reasons.  Firstly, you shouldn’t swap a shift without letting me know.  Secondly, you even swapped the shift, you start one hour late knowing it will be busy and leaving Ivanna alone.  That shows me you not taking me serious or the work.  Which hurts me enough and you can pick up your pay tomorrow and drop the key.  You don’t need to call me and I don’t see that we can work together.  This decision is made by Robert and I.  Thank you for everything.”

The applicant filed an application for an unfair dismissal remedy claiming that the respondent did not provide a valid reason for her dismissal and the respondent failed to give the applicant any opportunity to respond prior to the dismissal which represented non-compliance with the Fair Dismissal Code.

The Fair Work Australia decision

The respondent first sought to argue that the applicant was excluded from the unfair dismissal regime because she had not completed the necessary qualifying period, claiming she had only been employed by the respondent (the new employer) for a period of 9 weeks.  The Commissioner rejected this argument, finding that the employee was a “transferring employee” within the meaning of the legislation and that her prior service with her previous employer should count. 

The respondent then sought to rely upon the Fair Dismissal Code, arguing that it had followed the code in terminating the applicant’s employment.  In completing the code checklist, the respondent indicated it had terminated the applicant’s employment for serious misconduct and listed a number of reasons (none of which included the applicant swapping shifts). 

The Commissioner found that the respondent had presented a “moving feast” of reasons for why the applicant had been dismissed.  Firstly, there were the reasons the employer had communicated in the text message to the applicant.  The respondent had also listed (when completing the checklist) a number of reasons including vague suggestions of performance and behaviour issues, poor time keeping and “attitude” issues (alleging these constituted serious misconduct).  The respondent also sought to advance further reasons relating to customer complaints during the hearing. 

The Commissioner found that none of these reasons provided by the respondent provided a valid reason for the applicant’s dismissal.  In particular, the Commissioner held that the dismissal of the applicant (which it described as “summary” for the purposes of the Fair Dismissal Code) without any evidence to support a finding of serious misconduct was contrary to the code.

Further, in finding that there was no valid reason for the applicant’s dismissal, Commissioner Cambridge stated that the dismissal “more generally, is a reflection of the employer’s inappropriate and imbalanced approach which was driven more by reaction to the larceny rather than careful and reasoned assessment”.

The Commissioner also found that the dismissal of the applicant via text message was procedurally unfair.  Although there was evidence that the applicant and the respondent regularly communicated regarding work activities via text message, the Commissioner found that “there is of course no comparison that can be made between day-to-day communication about a variety of work and non-work related matters, and advice of termination of employment”. 

The Commissioner found the implementation of dismissal by way of text message deprived the applicant of any opportunity to respond to the allegations and the dismissal or offer an explanation or defence about any of the issues that may have contributed to the decision to dismiss.  He also found the applicant was denied a support person for discussions with the employer in contravention of the Fair Dismissal Code.

The Commissioner did recognise that there may be some circumstances where a decision to dismiss might be justifiably implemented without the need to provide the employee with face-to-face communication and an opportunity to be heard.  However, such circumstances would be confined to instances of gross and wilful misconduct which may possibly involve a genuine prospect of aggression or violence.

In all the circumstances, Commissioner Cambridge found that the applicant’s dismissal was a breach of the Fair Dismissal Code and was unfair.  He order the payment of compensation to the applicant in lieu of reinstatement in the amount of $9,992.

Sedina Sokolovic v Modestie Fashion Australia Pty Limited (U 2011 - 4117) (2011) FWA 3063