T11597
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TASMANIAN INDUSTRIAL COMMISSION Industrial Relations Act 1984 Rueben Thomas Gahan and Warn Hair and Gallery
Industrial dispute - termination of employment - breach of award - order issued REASONS FOR DECISION [1] On 20 July 2004, Rueben Thomas Gahan, (the applicant), applied, pursuant to s.29(1A) of the Industrial Relations Act 1984 (the Act), for a hearing before a Commissioner in respect of an industrial dispute with "Brendan Warne Hairdressing Salon" (the respondent) arising out of alleged unfair termination of his employment and the alleged breach of an award or a registered agreement. Subsequently, Mr Brendan Warn advised the Commission that the name of the company is Warn Hair and Gallery. [2] A hearing was set down for Friday 13 August 2004 at 11.30 am. At 10.52 am on that day a facsimile transmission was received by the Commission from Mr Warn, which said that he was unable to attend "due to heavy work commitments". The applicant also did not appear on that date. A further hearing date was set for Tuesday 7 September 2004 at 10.30am. I am satisfied that both parties were aware of the time and date of the hearing, which were confirmed by telephone. [3] On 7 September the respondent did not attend, nor was the Commission notified that he would not attend. I decided that the matter would proceed in the absence of the respondent, pursuant to s.21(2)(e) of the Act, but that the employer would be given the opportunity to make submissions in writing. Following the hearing, the Commission forwarded the transcript to the employer under cover of letter dated 17 September 2004. The correspondence advised that the Commission would take into account any written submission received by close of business on 27 September 2004, but that no new evidence would be admitted. A written submission was received from the respondent on that date, which has been taken into account, as has the right of reply received from the respondent on 6 October 2004. The Hearing [4] At the hearing Mr Gahan gave sworn evidence, during which he refreshed his memory from his diary, stating that he had commenced employment on 1 May 2004. He said that Mr Warn told him that he would become an apprentice hairdresser, which arrangement would not commence until 2005. Until then, he was to be a salon assistant. He was paid between $200 and $220 per week for working between 42 and 50 hours. He was never given a pay slip. His evidence was:
[5] Mr Gahan said that the work that he performed was all aspects of a salon assistant's work. He opened the salon each morning, commencing work between 8.30 and 8.50 am, although he was not paid for any time before 9.00 am. He had, however, been instructed to turn up early, so that the salon would be ready for clients. [6] He said that on Tuesday 8 June 2004 he slept in. He rang Mr Warn as soon as possible, which was about 10.00 am, when he was told that someone else was already filling in for him, and he was instructed not to attend on that day. [7] Mr Gahan presented for work at 8.30 am on the next day, June 9. To the best of his memory, Mr Warn said to him: "You're dismissed, you can take your things and leave now."4 [8] Mr Gahan said that he had never been late before and had never had any time off work, apart from one day when he had been instructed not to come in because he was not needed. He had never received any warnings. He could not recall anything ever being said to him regarding his performance. There had been some discussions about his work, but they were not discussions of a disciplinary or counselling nature. [9] According to Mr Gahan's evidence, he was not given a specific reason for the dismissal, apart from a comment along the lines of: "You're not the kind of employee that I want."5 [10] Mr Gahan said that he was not paid for notice or annual leave, nor was superannuation paid. [11] He said that he had been taken advantage of, and in respect of a remedy for the alleged unfair dismissal:
[12] Mr Gahan was instructed to provide to the Commission, within seven days, particulars of his claim relating to alleged breach of award, a record of what he was paid, his bank statement, and copies of relevant diary entries in support of his claim. He was informed that copies would be forwarded to the employer. It was agreed that private matters recorded in his diary could be blanked out. The Claim [13] On 13 September 2004, a particularised claim was received from Mr Gahan. [14] The claim is based on the Hairdressing, Health and Beauty Industry Award, Salon Assistant, weekly rate of $496.60 for a 38 hour week (hourly rate $13.06) and 15% loading for overtime. [15] His claim is $2515.43, including one week's pay in lieu of notice. [16] Copies of the claim were forwarded to Mr Warn. Written Submissions Mr Warn [17] Mr Warn, in his written submission, received on 27 September 2004, said that Mr Gahan was employed as an apprentice hairdresser and commenced on 1 May 2004, beginning on a "pre-employment basis". There was a verbal agreement that he would be on a three months trial basis. [18] He said that whilst it is true in part that Mr Gahan fulfilled all of the duties of a salon assistant, that was by choice and not because he was asked. It was never expected that he would work overtime, and although Thursday and Friday nights are late nights at the salon another apprentice usually fulfilled the role of salon apprentice on those nights. [19] Mr Warn said that there had been "obvious tampering with his diary times, which are probably a complete fabrication after the fact anyway." [20] He said that Mr Gahan was continually spoken to regarding lateness, and that he would call in sick after being seen out on the town by other employees. He was verbally warned on numerous occasions. [21] According to Mr Warn, Mr Gahan was paid according to their agreement and to the award, and he was paid severance pay. [22] Mr Warn said that he would be happy to reinstate Mr Gahan as a salon assistant for two days per week, four hours per day, until he has proven that he can come to work on time, conduct himself in a professional manner and make sure that he is hygienic. Mr Gahan [23] In his written response, received by the Commission on 6 October 2004, Mr Gahan submitted that there was an expectation that he would work overtime, because it was his job to prepare each client and to clean up afterwards. He was not told to stop work until all the clients were done for the day. [24] Mr Gahan said that he was never spoken to regarding lateness because he had never been late before the day he slept in, which resulted in his being sacked. His belief was that he slept in because of the long hours he was working. [25] The statement that his diary entries are a fabrication after the fact is not true, Mr Gahan said. He had kept a diary of his everyday events, times and thoughts since about the age of ten. FINDINGS Dismissal [26] Mr Warn was given two opportunities to appear before the Commission. His failure to do so has resulted in there being no opportunity for him to present evidence, nor to challenge the evidence of Mr Gahan. Whilst I am prepared to take Mr Warn's written submission into account, where there is conflict or uncertainty I must give more weight to Mr Gahan's testimony under oath than to Mr Warn's submissions. [27] Both parties say that the intention was that Mr Gahan would become an apprentice. Mr Gahan's evidence was that he had not signed a training agreement. Mr Warn's submission says that Mr Gahan was employed as an "apprentice hairdresser" starting on 1 May 2004, beginning on a "pre-employment basis", and that it was verbally agreed that he would be on a three month "trial" basis. Mr Gahan's evidence was that he was to be a salon assistant until the next year, when he would become an apprentice. He made no reference to a trial period. [28] There is a twelve weeks probationary period in the relevant award, at Part II, clause 2(d) that sets out strict requirements in relation to feedback regarding work performance. If the performance requirements are not met by the end of the probationary period, then the employee is to be given two weeks' notice. The probation period must be specified in the contract of employment. [29] There is no evidence of any contract of employment containing a reference to probation. From Mr Gahan's evidence and Mr Warn's submission, it appears that the terms of the award in relation to probationary employees were not applied. I find that Mr Gahan was not a probationary employee. Given his understanding, confirmed by Mr Warn, that he was to become an apprentice in the future, then he had a reasonable expectation of continuing employment, and, as such, his employment must not be terminated unless there is a valid reason for doing so. [30] In Mr Warn's submission, he said that Mr Gahan was "continually late" and that he "frequently" called in either sick or late. Mr Gahan's evidence was that he had never been late before and that he had never taken any sick leave. These two versions are diametrically opposed. There is no evidence before me to support Mr Warn's version of events, for example time and wages records. There is evidence in support of Mr Gahan's version, in the form of diary notes recording hours worked and sworn evidence. I must, therefore, accept Mr Gahan's version of events. [31] Mr Gahan's evidence was that he had never been given any warnings. Mr Warn's submission said that: "He was warned, if only verbally on numerous occasions and on the last occasion, he was told that it would be his last warning." [32] I accept Mr Gahan's evidence, given under oath, in relation to the lack of formal warnings. Mr Warn's submission is contradictory in this respect, given that he says that there were warnings regarding lateness, but he goes on to say: "in hindsight all of these issues [including alleged lateness] should have been discussed with Rueben at the time..." [33] Mr Gahan's evidence was that, the day after he slept in and called in late, he was told to "take his bits and pieces and leave on the spot." He could not think of any reason for his dismissal other than the events of the previous day. Mr Warn does not specifically refer to any one reason, but makes reference to Mr Gahan's "social and private life interfered with his ability to perform his duties as a salon apprentice". [34] I think it likely that it was the fact of Mr Gahan calling in late the day before that that brought about the dismissal, although there may have been other factors at work. The misconduct was not sufficiently serious as to warrant dismissal and counselling; at most, a warning would have been the appropriate response. I think it unlikely that an employer would dismiss an employee for a first offence of such a nature, and am of the view that there must have been other issues affecting the employment situation. I make no findings as to what they may have been, but note that Mr Gahan should have been given the opportunity to address any issues before the respondent made the decision to dismiss him. [35] It is clear that there was a denial of procedural fairness, in that Mr Gahan was given no opportunity to be represented, nor was he given the opportunity to put his case. Mr Warn had already made up his mind to dismiss Mr Gahan when he arrived for work on the day of the dismissal. [36] I find that the dismissal was unfair. Award Breaches [37] Mr Warn, in his submission, said that there was a verbal agreement between them that Mr Gahan would be paid as an apprentice, even though he was not one. In fact, Mr Gahan was paid about $4.50 per hour, for working up to 12 hours a day including Saturdays. This is far below the rate for even the most junior of apprentices. However, Mr Gahan was not an apprentice, therefore his rate of pay should have been that of a salon assistant. At the relevant time the hourly rate was $12.57, for ordinary time. I find that the employer has breached the award in relation to the rate of pay, annual leave and overtime and weekend penalties. [38] The payments made to Mr Gahan, varying from $95 to $220 per week, appear to be "cash in hand" amounts, from which no tax was deducted. Mr Gahan was never given any pay slips, or any details in relation to his wages. His evidence was that he did not sign anything, which must mean that he did not sign a tax declaration. His evidence was: "He would always just give me cash in hand." [39] Mr Gahan made diary notations of the amounts that he received each week. I accept this as evidence of what he was paid. It may be that the amounts received in a particular week relate to work performed during the previous week. In the absence of any time and wages records it is not possible to align payments to particular working days. What is recorded below as payments for "Week One, Week Two" etc indicates no more than that that they were the weeks in which the payment was received. In calculating the final amount due I have deducted the total amount paid from the total amount owed. There were no weeks in which underpayments did not occur. [40] Mr Gahan made diary notes of the hours he worked, which I accept in the absence of anything else, as evidence of the hours worked. He had the diary at the hearing, and, at the request of the Commission, provided copies to the Commission and to Mr Warn (with personal entries blanked out). I reject Mr Warn's assertion that: "there is obvious tampering with his diary times, which are probably a complete fabrication after the fact anyway." Such a serious accusation as evidence tampering would need to be proven. The time for Mr Warn to challenge the evidence was at the hearing. [41] In Mr Warn's submission he said:
[42] If such records do exist, they were never produced as evidence before the Commission, and I cannot take account of them. I note that it would not be possible for Mr Gahan to have been paid according to both "the agreement and to the award" because the alleged agreement was that he would work for apprentice rates when he was no such thing, which is in breach of the award. [43] Mr Gahan's particularised claim contains some errors. He states that the claim is for the hours he worked between 6 May and 9 June 2004, although he includes a claim for time worked on 1, 4 and 5 May 2004. It seems that the reference to 6 May as the commencement date is simply an error. The parties are in agreement that the starting date was 1 May, and that is what the diary notation shows. There are some discrepancies between what is recorded in the diary entries and what has been transposed to the claim. I have decided to make orders based upon the diary records. [44] Mr Gahan has incorrectly calculated overtime on the basis of a 15% loading, whereas it should be calculated either at time and a half or double time. It is likely that this error was based on an incomplete reading of the award. The correct approach is set out in the extracts from the relevant clause set out below.
[45] Mr Gahan has based the claim on the rate in the current award, which, he says, he obtained through the "intranet site". His claim is based on the rate that currently appears on the site, which has applied from 1 August 2004 ($13.08 per hour), when, in fact, the rate at the relevant time was $12.57 per hour. [46] I have taken all of these errors into account when calculating the underpayment and have adjusted the claim accordingly. [47] Mr Gahan's claim is based on all the hours from the time he commenced work until the time that he ceased work. I have assumed that Mr Gahan was able to take a meal break at some stage during each day. The award provides for a meal break of between 45 minutes and 60 minutes. It may be the case that he took no meal breaks, or he may have taken one hour. There is no evidence either way. I have decided to reduce the claim by 45 minutes per day. [48] There is no evidence as to whether or not Mr Gahan was paid meal allowances for the significant amount of overtime that he worked or that he was provided with meals. Under the terms of the award, if he was not provided with "an adequate meal" then he is entitled to be paid meal money on each occasion that he worked overtime for more than one and a half hours. Mr Gahan has made no claim for this and accordingly I have given the employer the benefit of the doubt and have not included meal allowances in the calculations. [49] Mr Gahan said that he was not paid severance pay; Mr Warn said that he was. I make no finding as to whether he was paid an amount for "severance" payment at the time of termination or not. I have decided that the best approach is simply to add up the total amount paid by the employer and to deduct it from the amount owed, including for notice and annual leave under the terms of the award, without specifically apportioning an amount as "severance" pay. Based on the following, detailed calculations appear in Schedule One, of this Decision. Hairdressing, Health and Beauty Industry Award - Salon Assistant $477.60 per week $12.57 per hour - ORD REMEDY [50] In his submission, Mr Warn said that he would take Mr Gahan back for eight hours per week provided that Mr Gahan made sure that he was "hygienic" and he made reference to Mr Gahan's "body odour". He said that he had not discussed issues with Mr Gahan at the time because of "the tightness with all of the laws surrounding staff and discrimination etc". From my own observations at the hearing, Mr Gahan presented as clean, well groomed, and (even if unconventionally) well dressed. [51] Mr Gahan said that he would go back to work at the salon, but that "there'd be a weird feeling there". [52] All that the employer is offering is eight hours per week, on trial. This is completely different to what previously pertained, which was a full time position, with an apprenticeship to be entered into. The offer is therefore not an offer of reinstatement. [53] In my opinion, an order for reinstatement would be impracticable, given the circumstances of this case, and payment of compensation is more appropriate. In determining the amount of compensation to be awarded, the Commission is required, at section 30(11) of the Act, to:
[54] A matter I consider to be relevant is the apparent exploitation of Mr Gahan's desire to become an apprentice hairdresser, resulting in long hours of work at extremely low rates of pay. I have considered the lack of procedural fairness. In the circumstances of this case, the amount awarded should reflect the considerable unfairness to the employee. Against that, I have taken into account the short period of service. I have decided that the amount of compensation to be awarded should be three weeks' wages based upon a 38 hour week at the ordinary rate of pay which applied at the time of the dismissal, being an amount of $1432.80. [55] Mr Warn submitted that:
[56] I accept the submission that the salon requires time to make the payment, and will order that it be paid in instalments. However, no viable business would be unable to pay more than $10 per week and I reject that aspect of the submission. I have decided that the instalments shall be $500 per month. ORDER I hereby Order, pursuant to s.31 of the Industrial Relations Act 1984, in full and final settlement of the matter referred to in 11597 of 2004, that Brendan Warn of Warn Hair and Gallery pay to Rueben Gahan the sum of Four Thousand Four Hundred and Sixty Eight Dollars and Fifty One Cents, and that the payment is to be made in the following instalments:
If any payment is not made by the due date then the whole amount becomes immediately due and payable.
P C Shelley Appearances: Date and place of hearing:
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