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Lack of processes led to an out of control problem finds FWC

By Portner Press on October 10th, 2018
  1. Industrial Instruments
  2. Fair Work Act

 

“Where was senior management and where were the policies and processes to deal with a rapidly escalating, out of control problem?” the Fair Work Commission’s Deputy President asked in an unfair dismissal hearing.

In a searing indictment, Deputy President Peter Sams spoke about how Beacon Products’ absence of formal processes allowed an environment to develop where “incidents festered and served to feed into a complete toxic mess”.

The cleaning chemical company had dismissed an administration assistant for alleged “grave misconduct towards colleagues causing conflict and negativity within the workplace”.

A failure to understand or follow processes

Sams pointed out that there is no definition in the Fair Work Act of ‘grave’ misconduct and concluded that Beacon’s director had “intended this description as being worse conduct than serious misconduct”. Also his termination letter did not elaborate on the reasons for the employee’s dismissal.

The company’s director told the Commission that the employee had systematically bullied a number of staff, including her manager and that her bullying continued after she was issued with a written warning. He believed that it was his duty of care to protect other workers by dismissing her.

However, the employee submitted that the director “dismissed her ‘on the spot’ without warning, notice or entitlements” and he “had never sought to address any issues he now claims other staff had with her”.

Deputy President Sams noted that the worker “was provided with no opportunity, let alone a reasonable one, to respond to [the director’s] allegations”.

“She received no warning of his allegations or of her dismissal. There were no specifics of the applicant’s alleged behaviour and no incidents were put to her. This was grossly unfair. [The director’s] investigation amounted to speaking to his employees and seemingly relying on those who were hostile or unsupportive of the applicant.

“The applicant was not told of these investigations, who was spoken to, or what was said by them. Statements from these employees were not sought until these proceedings. It was only then that the [director] had some idea of what she was accused of and had an opportunity to respond. For the [employee], this was too late. This factor tells in favour of a finding of unfairness.”

Witness evidence could not establish facts

A number of witnesses presented evidence that the Commissioner overall found to be unreliable and not relevant.

Sams observed that the witnesses “were squarely in either the [director’s] camp or [dismissed worker’s] camp” and “[g]iven the conflicting and diametrically opposed evidence from both sides” it was “difficult to disentangle fact from emotion, exaggeration or hyperbole”.

Sams said that the company’s “dysfunctional, shambolic environment … was split into various personality/loyalty factions depending on who liked who, and who was aligned to whom” and “[l]ike all dysfunctional workplaces built on competing strong personalities and personal fiefdoms, loyalties were fluid and allegiances changed from time to time”.

“Staff had crude nicknames for each other, played pranks on one another, joked and mucked around in the office, until the inevitable happened. Pranks and nicknames got out of hand and individuals became upset and hurt” he said.

Inattentive management to blame

Beacon’s director said that he wasn’t aware of some of the incidents witnesses recounted, which Sams said was “an indictment of his management” that reflected “very poorly on his apparent ‘full and unbiased investigation’”.

He went on to say that the director had shown no authority, or guidance as to the behaviour of his staff and the workplace culture that was developing and that “[t]here were certainly no formal processes in place to deal with inter-relationship issues in the workplace” which he said was “utterly unacceptable”.

The director’s “management skills leave much to be desired” Sams said.

“His approach to dismissing the applicant and the lack of procedural fairness were appalling and contrary to any common sense understanding of what constitutes decent and responsible employment procedures. [He] would be well advised to seek appropriate industrial relations advice if he finds it necessary in the future to performance manage or dismiss an employee.”

The company clearly failed to provide a valid reason for their employee’s dismissal or follow correct procedures and was ordered to pay the worker $3,384.60 in compensation.

Do you know how to performance manage or dismiss an employee legally?

Uninformed employers are fair game for the Fair Work Commission.

Don’t be the next one they will play.

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Employment Law Practical Handbook

Managing Underperformance

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