TASMANIAN INDUSTRIAL COMMISSION

Industrial Relations Act 1984
s.29 application for hearing of an industrial dispute

Mr Timothy Richard Smith
(T7008 of 1997)

and

Classic Video Pty Ltd trading as Video City

Industrial dispute - termination of employment - reinstatement impractical - compensation awarded

REASONS FOR FURTHER DECISION

On 17 October 1997 the Commission, as currently constituted, handed down Reasons for Decision which found that Mr Timothy Richard Smith (the applicant) had been unfairly dismissed on 20 May 1997 by Classic Video Pty Ltd trading as Video City (the respondent).

In that same decision the parties were requested, as a result of the finding, to present further submissions to the Commission on the remedy, as the submissions presented on 18 September 1997 were not sufficient to enable the Commission to arrive at an appropriate conclusion to the dispute.

To that end, this matter was relisted for hearing on 13 November 1997, to give the parties another opportunity to further address the Commission on these issues.

The hearing commenced, on that day, with the Commission inviting the parties to enter into private conference for the purpose of finalising this dispute. However, after a short period, the Commission was advised it was not possible for the parties to reach any settlement, so it was left to the Commission to determine.

Before making any order, s.31(1A) of the Act requires me to:

"... take into account the standards of general application contained in Part II of the International Labour Organisation's Convention concerning the Termination of Employment at the Initiative of the Employer."

(ILO Convention)

In circumstances where a termination is found to be unjustified, Article 10 of the ILO Convention provides that where a tribunal finds it impractical to reinstate the employee, then the tribunal may order compensation or such other relief as may be deemed appropriate.

Reinstatement

The applicant's primary position was to seek reinstatement but, after having discussions with Mr Ewing, for the respondent, during the course of the conference on 13 November 1997, he had arrived at the conclusion that reinstatement was not practical. The applicant said:

"I would like to think that it was practical, but just Mr Ewing's attitude towards me today obviously will be felt throughout the Company towards me and I feel that ... even though I would like my job back, I can sincerely say I wouldn't last long without being before you again."1

The applicant said the discussion with Mr Ewing proved to him that the exercise was futile and he sought compensation for the loss of his job.

On the question of reinstatement, Mr Ewing said that it was not an option as there was no vacancy in Launceston, now or in the foreseeable future. He said, the applicant did not lodge the application with the Commission until the 4 June 1997 and the respondent was not notified until 12 June 1997; that is, three and a half weeks after the dismissal occurred. Mr Ewing said it would be unfair to ask the respondent to sit in abeyance pending notification.

The Commission received the application by facsimile on 3 June 1997 at 6.26 pm and it was promptly registered on 4 June 1997.

I do not accept the contention that reinstatement is impractical solely because the position, previously occupied by the applicant, may have been filled by another employee.

Mr Ewing went on to submit that the employer/employee relationship could not be restored but, more importantly, he said:

"I don't and will not work with Mr Smith if you order a reinstatement.2

It was also submitted by Mr Ewing, that reinstatement was not appropriate, because the applicant's supervisor felt intimidated by him. He said that an order to reinstate would cause more than just discomfort or embarrassment. He contended it would severely affect the duties required to be undertaken by the supervisor in the Launceston area.

Given the submissions of the applicant and Mr Ewing, on the question of reinstatement, I would have to conclude that I see great difficulties in re-establishing a good working relationship. The applicant would have to work under the direction of the supervisor and, from the evidence given by the supervisor, under oath, during the course of the hearing, I am satisfied that she genuinely felt intimidated by the applicant and this would be difficult to overcome even in the fullness of time.

Therefore, I am satisfied that reinstatement of the applicant is impractical.

Compensation

In the event the Commission decided against reinstatement, Mr Ewing submitted that in Bostik (Australia) Pty Ltd v Gorgevski (No1) (1992) 36 FCR 20, at page.33, it stated that any compensation must be considered:

"... upon the basis that, where it is not for the unfair dismissal, it was likely that the employment would have continued indefinitely."

However, this principle must be weighed against:

"... the possibility that the employment might have come to an end as a result of a lawful dismissal which was not harsh, unjust or unreasonable"

This tenet, he argued, must be considered when determining compensation.

Mr Ewing went on to say the Bostik case also held, at page 32, that:

"Where an employee is wrongfully dismissed he is entitled, subject to mitigation, to damages equivalent to the wages he would have earned under the contract from the date of the dismissal to the end of the contract. The date when the contract would have come to an end must be ascertained on the assumption that the employer would have exercised any power he may have had to bring the contract to an end in the most beneficial way to himself, that is, he would have determined the contract at which he would have properly done so."

However, Mr Ewing said, the employee in Bostik had substantial security in his employment compared with the applicant in this matter who, he said, was employed under the Miscellaneous Workers Award which only required either party to give each other one week's notice of termination.

Mr Ewing acknowledged that, whilst the judgment in Nicolson v Heaven & Earth Gallery Pty Ltd (1994) 126 ALR 233, at page 246, reaffirmed the respondent in Bostik had substantial security in his employment, it was not intended to be a proposition of universal application.

In an attempt to show that the applicant's employment would not have continued for any length of time, Mr Ewing further submitted:

• It was well known and accepted by employees of the respondent that it was the applicant's intention to leave his employment and reside in Sydney.

• The applicant had frequently travelled to Sydney on his rostered days off.

• It was well known within the company that Mr Smith did not intend to remain with the company for any length of time if he was reinstated.

The applicant dismissed these submissions of Mr Ewing as being nothing more than hearsay. He said that he could not see why anyone would think he would leave a good job in Launceston to go to Sydney where he could not afford to live. Besides, he said, all his assets were in Tasmania including his house; car; friends; and girlfriend.

Mr Ewing said the applicant was 27 years of age, appears to be reasonably intelligent and would have a future ahead of him and, he was of the view, that his earning career as an employee had not be jeopardised.

He was of the view that the applicant did not actually want reinstatement, but only wanted the benefits flowing from the impracticality of reinstatement.

The applicant, Mr Ewing said, had been counselled once for his interaction with a customer. However, he did not consider the issue to be significant and he acknowledged that the applicant was generally a good worker.

The applicant asserted that he was an exemplary employee and did everything in a correct manner; was never late for work; got to work early; often stayed back; and, was highly conscientious.

The applicant had worked with the respondent for nine months. He said there was no reason for him to leave his job in the foreseeable future and:

"When I first started there, the manager at the time was Mr Patrick Reed. He felt I had a great deal of potential in the organisation. He actually did state I was over qualified for the job, but he would take me on in lieu of the possible supervisory positions coming up."3

Mr Ewing proposed that one week's pay was appropriate compensation to be paid to the applicant.

In answer to a question from the Commission:

"So you think he would have lasted one week after the dismissal date?4

Mr Ewing responded:

"I actually would have gone through the correct procedure of dismissing him, Mr Commissioner, and he would have been dismissed for falsifying his time sheet and he would have been dismissed for comments made here in this court ..."

Mr Ewing also submitted, there exists a well known and accepted principle at law, that is, a duty to mitigate a loss. It was his view, the applicant had not used his time diligently seeking alternative employment to mitigate his loss.

Since the time of his dismissal, the applicant said he had earned $3,500.00 in casual employment and, received unemployment benefits for four weeks at approximately $158.00 per week, making a total of $632.00. He also contended that since his dismissal he had applied for approximately 44 jobs, of which 14 were in the state of Tasmania. His only success was a recent offer of part-time work in Sydney.

I am prepared to accept that the applicant sought to mitigate his loss by applying for a number of jobs and undertaking short periods of employment between the time he was dismissed and this hearing.

In accessing the question of compensation, I am going to adopt the approach taken in Nicolson v Heaven & Earth Gallery Pty Ltd (1994) 126 ALR 233 and consider what would have been likely to occur if the unfair dismissal of the applicant had not taken place.

From the evidence, it is not possible to conclude that the applicant's employment might have come to an end as a result of a lawful dismissal which was not unfair, such as, the closure of the respondent's business or the implementation of a retrenchment policy involving some or all of its employees. Nor could I deduce a history of unsatisfactory work performance.

On the other hand, given the facts and circumstances of this case, I have not been persuaded that the applicant had a long term career with the respondent. There still exists an unresolved conflict between the applicant and the Regional Manager, which the applicant declined to ameliorate by seeking the assistance of the General Manager of Operations and/or the Managing Director. In addition, evidence, presented during the hearing, tends to indicate the applicant did not readily accept that certain tasks were required to be undertaken in accordance with the "duty list".

Equally, I would have to concede, the applicant may have chosen to terminate his position with the respondent and, as Mr Ewing asserted, reside outside the state of Tasmania. It is noteworthy that 30 of the 44 positions sought by the applicant were outside the state.

On balance, I appraise adequate compensation, in accordance with Article 10 of the ILO, to be 20 weeks' wages based on 38-hour week at ordinary time rate of pay, ie, $388.74 per week, totaling $7774.80.

From this, an amount of $4132.00 is to be subtracted, being monies received by the applicant:

Given the forgoing, I hereby Order, pursuant to s.31(1B) of the Act, that Classic Video Pty Ltd trading as Video City, of Suite 7, Mayfair Shopping Plaza, 236-244 Sandy Bay Road, Sandy Bay, Tasmania 7005, pay Mr Timothy Richard Smith, of 2 Danbury Drive, RSD Riverside, Tasmania 7250, an amount of $3642.80 on or before 5.00pm, 11 December 1997.

R J Watling
COMMISSIONER

Appearances:
Mr Timothy Richard Smith representing himself
Mr T Ewing for Classic Video Pty Ltd trading as Video City

Date and place of hearing:
1997
November 13
Hobart

1 Transcript page 78
2 Transcript page 85
3 Transcript page 79
4 Transcript page 89