In the case of McConnell v Terry White Chemists Victoria Point [2015] FWC 4060, a dispensary technician was dismissed by her employer due to unsatisfactory performance. The employee claimed she had been unfairly dismissed and was successful on the grounds that she was not provided with prior notice of the purpose of a workplace meeting nor given the opportunity to have a support person present at the meeting.

The employee was employed as a Dispensary Technician/Assistant under the Pharmacy Industry Award 2010. On 20 March 2015, the employee was asked to attend a meeting in the pharmacy clinic room without notice. During the meeting, the employee was advised that her front shop performance was poor and not to the standard required by her employer.

The employee claimed that as a dispensary technician, she was not required to work in the front shop of the pharmacy. She said she had performed the duties of dispensary technician since July 2010 and that she had never received any written warnings about her performance.

The employer claimed the employee regularly made dispensing and recording errors, refused to promote the franchise brand items and performed her role with low enthusiasm and a negative attitude. The employer believed the employee’s behaviour, frequent errors in the dispensary and attitude towards her employment was detrimental to the pharmacy. Although no formal written warnings had been given to the employee, the employer said that the employee had been told about the issues and told that she could lose her job if the errors continued. The employer said that despite reminding the employee of the problems on numerous occasions, the employee refused to perform her duties as directed and rejected offers of further training and assistance.

Prior to the meeting on 20 March 2015, the employer concluded it was necessary to dismiss the employee for unsatisfactory performance. The employer formed the view that it had provided the employee with ample warnings and opportunities to improve her performance. The employer considered the factors outlined in the Small Business Fair Dismissal Code (“Code”) and dismissed the employee. The employee lodged a claim for unfair dismissal.

Section 385 of the Fair Work Act 2009 (Cth) (“Act”) provides that a person has been unfairly dismissed if the Commission is satisfied that the dismissal was harsh, unjust or unreasonable and the dismissal is not consistent with the Code.

The Code applies to employers who employ fewer than 15 employees and requires employers to take certain steps before dismissing an employee including:

  • the employee must be warned that if there is no improvement to their conduct or capacity, they could be dismissed;
  • the employee must be warned that if there is no improvement to their conduct or capacity, they could be dismissed;
  • the employee must be given a valid reason why their employment is at risk;
  • the employer must give the employee an opportunity to respond to the warning and give the employee a reasonable chance to rectify the problem;
  • the employer must provide additional training to the employee where required; and
  • the employer must allow the employee to have support person present in discussions about matters where dismissal is possible.

To successfully defend an unfair dismissal claim, the employer must prove that it has complied with the Code.

Before entering the meeting on 20 March 2015, the employee was not told that the meeting was a meeting that could result in termination of her employment or that she could bring a support person to the meeting. Accordingly, the employer did not strictly comply with the Code and could not claim the defence of the Code against the application for unfair dismissal. As a result, it was necessary for the Commission to consider section 387 of the Act.

Section 387 of the Act sets out the following criteria which the Commission must take into account in determining whether a dismissal is harsh, unjust or unreasonable:

  • whether there was a valid reason for the dismissal related to the person’s capacity or conduct and whether the employee was notified of that;
  • whether there was a valid reason for the dismissal related to the person’s capacity or conduct and whether the employee was notified of that;
  • whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person;
  • any unreasonable refusal by the employer to allow the employee to have a support person present at any discussion related to dismissal;
  • if the dismissal relates to unsatisfactory performance – whether the employee had been warned about the unsatisfactory performance before the dismissal;
  • the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal;
  • the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise which would be likely to impact on the procedures followed in effecting the dismissal; and
  • any other matters that the Commission considers relevant.

In considering those factors, the Commission found:

  • the employer gave the employee a range of warnings about its dissatisfaction with her performance or capacity;
  • the employer had significant concerns regarding the employee’s  performance and the impact of her performance on productivity and business objectives;
  • the employer had significant concerns regarding the employee’s  performance and the impact of her performance on productivity and business objectives;
  • the employer had established a valid reason for the employee’s dismissal;
  • the employee was given warnings and opportunities to improve her performance;
  • prior to her dismissal, the employee was not notified of the reason for her pending dismissal and was not advised of the employer’s intentions for the meeting;
  • the employee was not invited have a support person present at the meeting;
  • the employer was a small business operator who may not have been aware of the correct procedures to follow to dismiss the employee; and
  • the absence of dedicated human resource management specialists or expertise provided an explanation for the way the employee was dismissed.

Although the employer was a small business employer without dedicated human resource management expertise, the Commission view was that the size of the business and the absence of expertise did not excuse the employer from its obligations to give the employee due procedural fairness.

Ultimately, the Commission held that because the employee was dismissed without prior notice of the meeting or the potential consequences of the meeting and was not given the opportunity to have a support person present, the dismissal was harsh and the claim for unfair dismissal was successful. The Commission awarded the employee four weeks usual wage as compensation for her dismissal.

Although reinstatement is the primary remedy for unfair dismissal, the Commission considered it inappropriate in the circumstances, stating that reinstatement “would not achieve a productive or cooperative result”. Further, the Commission held that given the breakdown in the employment relationship and the employee’s attitude to her employer and the workplace, it was likely that the employee’s employment would not have persisted for longer than a further four weeks.

For employers, this case emphasises the importance of strict compliance with the Code (if it applies) and ensuring that all obligations relevant to a dismissal are discharged prior to making the decision to terminate an employee. Employers cannot assume that an employee is aware of his or her rights or that an employee can foresee any steps being taken by the employer in respect of that employee’s employment.

For any queries or for assistance with employment matters, please contact Sarah Stoddart.