WESTERN AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION

CITATION : 2018 WAIRC 00663

DELIVERED : Monday, 23 July 2018

FILE NO. : U 145 OF 2017

Applicant

AND

Mr Gaetano Anthony Lagana

Stratton Park Pharmacy

Respondent

CatchWords : Industrial law (WA) – Claim of unfair dismissal – Application accepted out of time – Dismissal by small business – Denial of procedural fairness – Applicant unfairly dismissed – Reinstatement impracticable – Applicant would have been dismissed anyway – Clash of personalities in a small business – Applicant destroyed trust and confidence – Compensation for time it would have taken to dismiss fairly

Legislation : Industrial Relations Act 1979  s 23A(8), s 29(3)

Result : Application upheld in part

Representation:

Applicant : Mr D Rafferty, of counsel

Respondent : Mr R Jones, as agent

Reasons for Decision

1         As at 13 October 2017 the applicant had been employed by the respondent as a Pharmacy Assistant for 14 and a half years. On that date the respondent handed the applicant a letter terminating her employment. The letter said that the applicant was "no longer required to attend the workplace" but concluded "in view of your service I am prepared to provide you with the equivalent of 4 weeks pay."

2         Although there had been some problems in the workplace involving the applicant, and at this time I use the term "involving" in the most neutral sense possible, she had not been warned at any time that her employment was in jeopardy nor had the matters referred to in the letter been properly investigated by the respondent, or at least they had not been investigated in any way which involved getting the applicant's side of the story with her knowing them to have, potentially, an effect on her employment.

3         To dismiss an employee who has given over 14 years' service in this way was, in my view, plainly unfair.

4         The applicant may have been a casual employee but she was an employee of long standing and an employee who had developed a reasonable expectation of ongoing employment, unless that employment ended for good reason and after a proper process. An employer cannot, without warning and without a process involving hearing the employee's side of the story, dismiss an employee in such circumstances. Even if there were, in the employer's mind, grounds for summary dismissal (and I find that none of the matters upon which the respondent relied fell into such a category) there was still a need for some basic process preceding dismissal.

5         Here the respondent simply formulated a basis for dismissal in his own mind and, without warning the applicant about it or even sharing it with her, dismissed her.

6         This, in my view, is unfair and I have no hesitation in finding that the applicant was dismissed and that the dismissal was unfair.

7         This leaves the question of remedy. The applicant says that she intended to work at the respondent's business for several years more until retirement. She also claims that, if the respondent had conducted himself fairly and properly in relation to her, there is no reason why this would not have occurred.

8         The applicant does not wish to be reinstated or re-employed by the respondent and asks me to accept that those options are impracticable and order that she be paid compensation.

9         The applicant says that she has attempted to mitigate her loss without success. The applicant says that the compensation to be paid to her would, but for section 23A(8) Industrial Relations Act 1979, be more than six months' remuneration and, taking into account that subsection, she seeks six months' remuneration.

10      I find the applicant's argument that her employment could not have, and would not have, been brought fairly to an end within six months of the date upon which she was dismissed to be, taking into account all of the circumstances, unrealistic and ultimately flawed.

11      The respondent ran two very small businesses, the Stratton Park Pharmacy, at which the applicant worked, and the Amelia Heights Pharmacy. At the Stratton Park Pharmacy there were three people on site at any given time and the respondent had, at any given time, six employees available to ensure this happened.

12      Problems had arisen in relation to interpersonal relationships at the Stratton Park Pharmacy. Reza Azhdari, one of the pharmacists at the Stratton Park Pharmacy, and the applicant did not get along. 

13      This had been the case since Mr Azhdari commenced working at the Stratton Park Pharmacy in 2011.  The applicant said that after this the pharmacy "was not a happy place" because of changes Mr Azhdari introduced and that from when he commenced "there was no friendship or laughing or anything like that."  The applicant said she did not like this.

14      My assessment of the evidence I heard leads me to conclude that there ended up being a serious personality clash between the applicant and Mr Azhdari.

15      My observations of the applicant and Mr Azhdari in the witness box reinforce that conclusion.

16      Both the applicant and Mr Azhdari have very strong egos, in the sense that term is in common usage.

17      In the applicant's case this manifested itself in generally good ways for an employer, such as having a take charge attitude, taking her role seriously and being able to deal with people confidently. On the other hand, it meant the applicant did not suffer fools gladly and was prone to expressing herself too directly, or even rudely, at times. An example of this is when she escalated a disagreement with another Pharmacy Assistant, Ms Phuong Anne Nguyen, by calling her a "psycho".

18      In Mr Azhdari's case his strong ego manifested itself in different ways. Mr Azhdari was a remote figure in the Stratton Park Pharmacy, who did not expect or want to deal with the minutiae of running a small business.  He was not interested in, or able to create, a "fun" environment in the workplace through things like humour, small talk and socialising. He was a poor listener whose obvious preference was to dispense medicine and hope that other aspects of the business took care of themselves, becoming frustrated when he had to intervene.

19      The applicant appears to have come across to Mr Azhdari as pushy and having an overblown sense of self-importance. Mr Azhdari appears to have come across to the applicant as cold, severe and uncommunicative.

20      By the middle of 2017 these differences in style and personality were causing real problems, although the respondent said the differences had been a source of friction for a long time.

21      There had been words between the applicant and Mr Azhdari in March 2017 relating to, according to the applicant, Mr Azhdari directing another Pharmacy Assistant to wash an external window on a hot day.

22      In the aftermath of that incident the applicant played a role in sending Mr Azdhrai a "message" relevant to the dispute by a page from the applicable Award being placed where Mr Azhdari was bound to see it without telling him.  The applicant then denied involvement when questioned about it by him.

23      Also in March 2017 there were words between the two after the respondent instructed Mr Azhdari to calculate the applicant's pay in a slightly different way, resulting in a small loss to her, with the applicant reacting angrily to Mr Azhdari.

24      In April 2017 the applicant challenged Mr Azhdari in relation to a job advertisement that had been brought to her attention saying "Who's getting fired?" when she knew nothing about the circumstances which had prompted the advertisement's placement.

25      In June 2017 there was a further, and heated, clash between the two relating to Mr Azhdari's intervention in an argument between the applicant and Phuong Anne Nguyen.

26      The June incident gave rise to a formal letter of complaint from the applicant and then, on the respondent's instructions, an investigation, conducted by a human resource consultant, which pitted the applicant's version of events against that of Mr Azhdari (and, it would seem, Ms Nguyen).

27      The applicant herself gave evidence that by this stage the work environment at the Stratton Park Pharmacy was "toxic."

28      In July 2017 the applicant took time on a day off to go to the respondent with a catalogue of mistakes she said Mr Azhdari had made, most of which, I should note, Mr Azhdari denies having made.

29      I have no hesitation in agreeing with the applicant when she describes the work environment at the Stratton Park Pharmacy when she and Mr Azhdari were there as toxic.

30      The respondent was well aware of the unhappy state of affairs at his business.

31      The problem was such that the respondent evidently decided he had to do something about it. As a first measure the respondent separated the applicant and Mr Azhdari as much as he could. Neither worked full time so this could be achieved up to a point.  The respondent changed the roster so that whereas previously the applicant and Mr Azhdari had worked together on two days, they ended up working together on only one day.

32      That was an understandable approach so far as it goes but it was by no means a complete solution. Every day of operation was important to this business, which was not a spectacularly successful one, and even one day where two important staff members were on bad terms, as these two inarguably were, was one day too many.

33      The respondent decided that he would try to remove the applicant entirely from contact with Mr Adzhari by exploring whether she would be prepared to do some hours at his other pharmacy, the Amelia Heights Pharmacy.  He communicated this idea to the applicant.

34      It is from this point on that the applicant's actions bring her unstuck in relation to her assertion that she should be awarded six month's compensation for being unfairly dismissed.

35      The applicant gave evidence that she did not believe the respondent was serious about giving her hours at the Amelia Park Pharmacy, and, for this reason, when he asked her "would you like to work at Amelia Heights?" she simply answered "No". 

36      Despite this the applicant then decided to investigate the respondent's idea about her doing some work at the Amelia Heights Pharmacy, and his sincerity in raising this as a solution to the problems at the Stratton Park Pharmacy.  She did not explain in evidence why she would do such a thing given that she had told the respondent she did not want to work at the Amelia Heights Pharmacy.

37      The applicant rang the Amelia Heights Pharmacy and spoke to "Vivian" who had "been there for years" and asked her whether any hours were available there.  Vivian responded "No, not unless I'm getting fired and don't know about it."

38      The applicant's investigation reinforced in her mind her initial thought that the respondent was not being honest or sincere when he raised the possibility of her working at the Amelia Heights Pharmacy.

39      This shows, to my mind, and resoundingly so, that the necessary trust which an employee must have in their employer for an employment relationship had broken down and that the applicant had become too wilful and combative in her dealings with her boss for her to have a long term future in his employment.

40      The applicant had said she was not interested in working at the Amelia Heights Pharmacy when the respondent asked her about it.  Nothing of any moment happened immediately afterwards in terms of her employment.  Despite this she decided to launch an enquiry into her employer's honesty and sincerity.

41      The applicant had no absolutely no business going behind the respondent's back in the way she did by calling the Amelia Heights Pharmacy.

42      Such a call could easily have caused problems at that pharmacy.  So much is clear from the evident direction in which Vivian's mind wandered having been asked the question even if the applicant thought it was in jest.

43      Further, the applicant had no basis whatever to come to the conclusion that her employer was lying to her on what she had been told.

44      The applicant could not know the mind of her employer and what he had planned. Her actions show that she had lost confidence in the respondent's honesty and that she was completely unconcerned about the consequences for his business of her trying to establish this.

45      The applicant also tellingly demonstrated her wilfulness and combative attitude around this time in another phone call to the Amelia Heights Pharmacy.

46      The applicant was told by the respondent that she would no longer be working Saturdays and that she, and another Pharmacy Assistant at Stratton Park Pharmacy, were being replaced by a single person on that day. 

47      The applicant rang the Amelia Heights Pharmacy, where that person worked, and was told by the person she spoke to, Danielle Schwartzer, a Pharmacy Assistant at the Amelia Heights Pharmacy, that Cliff Roberts, a Pharmacist at the Amelia Heights Pharmacy, had directed that the new person come to the Stratton Park Pharmacy on a Friday, when the applicant worked, to be trained prior to her commencing on Saturday.

48      The applicant gave evidence that she said in response "Well, Cliff can get stuffed".  She said this because she considered it "a bit rude that I have to train her if she's taking my hours."

49      The applicant told me that when she said those words she was joking and that she had also said in that conversation, and maintained, that the respondent was the boss and could, in relation to staffing arrangements and directions to train, do as he pleased.

50      In terms of the applicant's work hours being changed this had happened several times over the course of her employment.  The applicant had also seen it happen to other Pharmacy Assistants.  It was an unusual but by no means unprecedented event. 

51      If part of the applicant's case was that I should read something relevant to this matter into the respondent's decision to turn the two Saturday shifts into one shift and to give it to another person she has failed in this endeavour. 

52      The respondent gave evidence that he made the decision for financial reasons and in the future interests of the business as the new person was studying pharmacy.  I accept his explanation.  It was not undermined by cross-examination of him.  Further, changes to hours for one reason or another was by no means unheard of in the respondent's businesses.  The respondent gave a good reason for the change on this occasion.

53      It was inappropriate for the applicant to say what she did to Ms Schwarzer because it showed a lack of respect for Mr Roberts, regardless of whether the applicant and Mr Roberts were on friendly terms, and because it did indicate a lack of willingness to assist the respondent in relation to matters the applicant accepts were within his prerogative.

54      The phone calls were clearly on the respondent's mind when he dismissed the applicant.

55      The first paragraph of his letter of dismissal, as elaborated upon by the respondent in his evidence, reference them.

56      I consider that the respondent could have, as at 13 October 2017, put to the applicant that she had misconducted herself by:

(1)   going behind his back by ringing the Amelia Heights Pharmacy to investigate his plan to give her hours at that business;

(2)   by ringing the Amelia Heights Pharmacy about the new employee and expressing herself in the way she did to Ms Schwarzer.

57      I consider that had he done so, and had he gathered all the relevant evidence including comment from the applicant, the respondent could have, and would have, decided to dismiss her at that point and fairly so.

58      I consider that the respondent would have reasonably found that the applicant responded completely inappropriately by independently investigating his plan to give her hours at the Amelia Heights Pharmacy and did so in a way that revealed she had no confidence in, or respect for, him and his role as her employer and a small business owner.

59      I consider also that the respondent would have reasonably found that the contents of the call to Ms Schwartzer were completely inappropriate in terms of expression and content and that the defence that the comment about Mr Roberts was a "joke" to be unconvincing and no good excuse.

60      That is, I consider the phone calls constitute evidence that the applicant had lost trust in the respondent and was now behaving without regard to his proper interests.  That is a breakdown in the employment relationship that could reasonably occasion an employer bringing it to an end.

61      I disagree with the applicant's submission that the appropriate response to her conduct could not have gone beyond counselling and a warning.  While not enough to result in summary dismissal the conduct was serious enough to warrant dismissal.  It showed a sufficiently great lack of respect for the respondent and his legitimate business interests, in the context of a tiny business, to put the employment relationship in jeopardy and for a decision to bring it to an end by the respondent to be a reasonable one.

62      What is more, I consider that the respondent would have reasonably weighed the phone calls in a balance which also had in it the interpersonal problems between the applicant and other staff at the Stratton Park Pharmacy.

63      I consider that the applicant's more recent behaviour would reasonably have tipped the balance in favour of a finding by the respondent that the applicant was at least a big part of the problems at that pharmacy as others, if not a greater part of the problems than others.  Here were examples of combativeness and disruptiveness directly toward the respondent.  He could have reasonably concluded that this attitude may have been on display at the Stratton Park Pharmacy.

64      The problems at the Stratton Park Pharmacy would have made a decision by the respondent to dismiss the applicant after enquiry into the October conduct even more understandable and reasonable.

65      The applicant asserts, I think, that the respondent should have, in relation to what happened at the Stratton Park Pharmacy, investigated all of the incidents and exchanges that I heard evidence about and carefully apportioned blame and that, if he had done so as the incidents and exchanges arose, he would have found that Mr Adzhari was mainly at fault. 

66      Alternatively, the applicant asserts that had the respondent investigated the problems early and well he would have, even without apportioning blame, determined that the problems at the Stratton Park Pharmacy were not so great, at an early stage at least, that they could not have been successfully managed.  The applicant says the respondent should have dealt with the problems earlier and better and if he had done so none of what happened later would have occurred.

67      Again alternatively, the applicant asserts that even if the respondent did conclude that there were problems with the applicant's conduct he should have been warned her about a continuation and given her a chance to show she could work consistently with the requirements of an ongoing employment relationship.

68      The applicant says that the failure to do any of the above makes her dismissal unfair.

69      I disagree with all of these assertions. 

70      The Stratton Park Pharmacy was a tiny business, with three employees present on the premises at any one time.  The respondent was entitled to employ people and hope that they could work together productively and harmoniously.  On the basis of what he knew about relationships at the pharmacy before he received the applicant's formal letter of complaint in June 2017 he was entitled to think that the problems at the pharmacy could work themselves out without much intervention on his part. 

71      When he got the letter of complaint from the applicant he did come to the conclusion that the problem may be more serious than he had thought and so, to his credit given the size of his business, he had that incident investigated. 

72      It is clear that whatever emerged from the investigation it did not reveal outrageous conduct on the part of anyone which required disciplinary action.  I cannot see any relevant omission on the part of the respondent in response to the investigation.

73      The respondent was, however, entitled to come to the view on the basis of all he knew at this stage that Mr Adzhari and the applicant simply did not get along and that "they would never work out their differences".  I have to say that based on my observations of the two I agree entirely with the respondent's opinion to this effect given in evidence.

74      There was no relevant failure on the respondent's part to intervene earlier or to take different action or to arrange mediation or anything like that.  There was simply a personality clash between Mr Azhdari and the applicant that was exhibiting itself in various ways, with no allegation being of such a serious nature that the respondent failed in not "getting to the bottom of it."

75      The respondent was entitled to deal with the clash by separating Mr Azhdari and the applicant to the extent he could by changing the roster and then to explore with the applicant whether she might be prepared to work at his other business.

76      Ultimately, it was the applicant's actions and the attitude they revealed after the respondent made sensible attempts to manage the situation that brings her undone in terms of her claim that her employment would have and should have continued to retirement. 

77      I think, taking into account the misconduct and the attitude toward the respondent demonstrated by the applicant in October 2017, and the problems at the Stratton Park Pharmacy, the attempted management of which had, at least in part, led to wilfulness and disruptiveness by the applicant, the respondent could have and would have reasonably brought the applicant's employment to an end if he had, rather than dismissing her on 13 October 2017, conducted an appropriate process.

78      I consider that that process would have taken no longer than two weeks.  They would not have been difficult to investigate. 

79      Assuming that the applicant would have continued to work during those two weeks I consider, consistent with the respondent's offer to pay the applicant four weeks of pay when he thought he could summarily dismiss her, that the respondent would have given her four weeks' notice after the enquiry had concluded.  I think that that is the reasonable period of notice.  The applicant was a casual employee but had been employed, and given predominantly good service, for many years.

80      I consider that the submission that a longer period of notice was called for to be over the top and especially so given that the applicant would have, if the respondent had done things better, have been fairly dismissed for misconduct.  The applicant took the good from being a casual for many years, by which I mean the 20% loading on her pay, and must accept that the nature of the relationship, as accepted by both parties, would have had consequences if she was to be let go at some stage, and by this I mean that any expectation of a period of notice beyond four weeks has to be accepted by her as unrealistic.

81      I find that the respondent should pay the applicant an amount of compensation equating to six weeks of her regular salary.  I accept the applicant's submission that she had received an average of $666.52 per week in the six months prior to termination of her employment in October 2017 and while that average may have been slightly affected if the applicant had earned less than this in the two weeks I say it would have taken to fairly dismiss her (if she had not worked the Saturdays in that fortnight) I will calculate compensation on the basis of $666.52 per week so that the total amount ordered to be paid will be $3,999.12 (minus tax).

82      I make no award for humiliation or distress as there was no convincing evidence that the applicant was anything other than angry when she was terminated.

83      It perhaps goes without saying in light of the above but, for the sake of completeness, I agree with the applicant that both reinstatement and re-employment are impracticable.

84      Finally, I note that the application was technically filed one day out of time, although an unsuccessful attempt was made to file it electronically in time.  Nothing was made of this by the respondent, quite appropriately in my view, and I have no hesitation in finding that given the length of the delay, the merits of the applicant's case, now fully exposed, and the lack of any prejudice arising out of the late filing to the respondent that it would be unfair not to accept the referral out of time as section 29(3) Industrial Relations Act 1979 empowers me to do.