15 September 2011 Employee succeeds in proving Unfair Dismissal but is left without a remedy

By Warwick Ryan, Partner and Nathen Day, Law Clerk

In Brief

In an extraordinary decision, Fair Work Australia (FWA) has found an unfair dismissal despite the employer proving a valid reason for dismissal and compliance with the procedural justice requirements. In a further twist, the employee was left without a remedy.

Mark Notman v Neway Transport [2011] FWA 5162

Mark Notman (Notman) was employed by Neway Transport (the Employer) for ten years. Following an investigation in which it was alleged that Notman urinated in front of a female employee, the Employer terminated Notman and gave him four weeks pay in lieu of notice.

Later evidence revealed that Notman did not in fact urinate in front of the female cleaner, but rather entered the toilet whilst the female cleaner was cleaning and started to unzip his trousers as he stepped over her cleaning equipment.

Notman lodged an unfair dismissal claim with FWA.

First Issue – Was there a valid reason for dismissal?

As has been previously emphasised in an earlier article Valid reason for dismissal the key to defending unfair dismissal claims, the primary consideration in an unfair dismissal claim concerns whether there was a valid reason for the dismissal.

Commissioner Bissett found that Notman's actions in starting to unzip his trousers in front of the female cleaner showed a total disregard for her and left her feeling humiliated. His actions also contravened the Employer's policies on sexual harassment, workplace harassment and ethical standards.

Accordingly, Commissioner Bissett found that there was a valid reason for dismissal.

Second Issue – Was Notman afforded procedural justice by the Employer?

After establishing a valid reason for dismissal, the second issue in an unfair dismissal claim concerns whether the employer has afforded procedural justice to the employee by notifying the employee of the reason and providing the employee with an opportunity to respond.

Commissioner Bissett found that the Employer had afforded Notman with procedural justice by asking for an explanation to the allegation, inviting him to a meeting (which he did not attend), considering Notman's written statement and inviting him to a further meeting which he further declined to attend. His Honour noted that an employee cannot decline invitations to meet with the employer and then complain that he was denied procedural justice.

Third Issue – Was the dismissal unfair?

Generally, when there is a valid reason for dismissal and compliance with the procedural justice requirements, there is scant basis for a successful unfair dismissal claim. However, Commissioner Bissett interestingly found that the dismissal was unfair on the basis of the employee's contrition and the disproportionate response of the employer. In other words, his Honour found that the penalty of termination was harsh in response to the misconduct.

The finding, however, leaves open the questions:  

  1. Was there really a valid reason for dismissal if it was later found that the penalty of termination was too harsh?          
  2. Was it really the case that there was not a valid reason for dismissal in the first place?
No entitlement to a remedy because of misconduct

Notwithstanding the finding that the dismissal was unfair, Commissioner Bissett refused to award compensation to Notman because of his misconduct. Further, it was found that his actions were the reason for his termination and he had humiliated and caused distress to the female cleaner.

Significance of the decision for employers

This decision provides a timely reminder to employers that although it may appear that they have a valid reason for dismissal, they need to consider whether dismissing an employee who has committed some form of misconduct is an appropriate response. Nonetheless, employers can take comfort from the position taken by Commissioner Bissett in denying compensation in full on the basis of the employee's misconduct. However, it cannot be guaranteed that a FWA member will take such a strict approach in future cases concerning employee misconduct.

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This article is not legal advice and the views and comments are of a general nature only. This article is not to be relied upon in substitution for detailed legal advice.

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