DECISION NO: 250/96 C A T C H W O R D S INDUSTRIAL LAW - UNLAWFUL TERMINATION - the construction of the EMPLOYMENT CONTRACT - VALID REASON - whether evidence of poor sales figures decisive of allegation of poor performance - requirement to properly train and instruct - COMPENSATION - whether compensation under s 170EE(2) extends to an award for mental distress Industrial Relations Act 1988 ss.170DB, 170DB(4), 170DC, 170DE(1), 170DE(2), 170EDA(1), 170EE(1)(b)(ii), 170EE(2), 170EE(3); Schedule 10, Schedule 11 Clause (8) CASES: Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337 Nicolson v Heaven and Earth Gallery Pty Ltd (1994) 1 IRCR 199 Harmer v Cornelius (1858) 5 C.B.(N.S.) 236 Printing Industry Employees' Union of Australia v Jackson & O'Sullivan Pty Ltd (1957) 1 F.L.R. 175 Selvachandran v Peteron Plastics Pty Ltd (1995-96) 62 IR 371 Aitken v The Construction, Mining, Energy, Timberyards, Sawmills and Woodworkers Union of Australia - Western Australian Branch (1996) 63 IR 1 Clunne v Nambucca Shire Council (unreported, Moore J, No. NI 1071 of 1995, 8 August 1995) Duncan v King Fleight Holdings Ltd (unreported, No. WI 1215 of 1995, 1 August 1995) Patch JR Burazin v The Blacktown City Guardian (unreported, Madgwick J, No. NI 3718 of 1995, 15 December 1995) Brackenridge v Toyota Motor Corporation Australia Ltd (unreported, Beazley J, No. NI 1218 of 1995, 19 April 1996) EVA ANDREA HURSKIN - v - AUSTRALIAN JEWISH PRESS PTY LTD (A.C.N. 008-631-347) No. VI 4239 of 1995 Before: Judicial Registrar Millane Place: Melbourne Date: 13 June 1996 INDUSTRIAL RELATIONS COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY VI 4239 of 1995 B E T W E E N : EVA ANDREA HURSKIN Applicant AND AUSTRALIAN JEWISH PRESS PTY LTD (A.C.N. 008-631-347) Respondent MINUTES OF ORDERS Judicial Registrar Millane 13 June 1996 THE COURT ORDERS BY CONSENT THAT: 1. The title of the respondent is amended to Australian Jewish Press Pty Ltd (A.C.N. 008-631-347). 2. The respondent pay to the applicant the sum of $50.00 pursuant to s.170DB(4) of the Industrial Relations Act 1988. 3. The respondent pay to the applicant the sum of $150.00 by way of commission payments. AND FURTHER ORDERS THAT within 21 days of the date of making these orders: 4. The respondent pay to the applicant compensation in the sum of $5,633.33 less any sum required to be deducted therefrom by the respondent pursuant to the Income Tax Assessment Act 1936 and actually paid to the Commissioner of Taxation. 5. There be liberty to each party to apply to the Court on reasonable notice on the amount of compensation payable pursuant to the lastmentioned order. NOTE: Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules. INDUSTRIAL RELATIONS COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY VI 4239 of 1995 B E T W E E N : EVA ANDREA HURSKIN Applicant AND AUSTRALIAN JEWISH PRESS PTY LTD (A.C.N. 008-631-347) Respondent Before: Judicial Registrar Millane Place: Melbourne Date: 13 June 1996 REASONS FOR JUDGMENT The applicant seeks compensation by reason of the alleged unlawful termination of her employment by the respondent as an advertising sales representative on 27 July 1995, after some six months employment. She alleges contravention of Division III Part VIA of the Industrial Relations Act 1988 (the Act) and, in particular, sections 170DE(1) and (2), section 170DB and section 170DC of the Act. She also seeks payment of compensation to reflect the distress she suffered as a result of the termination. This lastmentioned claim is made, not as an accrued jurisdiction claim arising out of any alleged breach of her contract of employment, but by reference to the provision for the payment of compensation contained in sections 170EE(2) and (3) of the Act. As a preliminary matter the parties consented to an order amending the respondent's title to read 'Australian Jewish Press Pty Ltd A.C.N. 008-631-347'. The respondent defends the proceeding on all issues save for claims by the applicant for unpaid commissions of $150.00, acknowledged as owing by the respondent, and the sum of either $50.00 or $75.00 payable for the unpaid portion of her car allowance pursuant to section 170DB(4) of the Act. The respondent contends that only $50.00 is payable because the $25.00 claimed for the petrol allowance should not be paid when the applicant was not required to work out her period of one week's notice. This issue is addressed later in my reasons for judgment. The respondent's justification for the termination on 27 July 1995 is that during the period of approximately six months of employment the applicant substantially under-performed in selling advertising space in the respondent's newspaper for most of that time. WITNESSES The following witnesses were called by the respondent: 1. Sam Lipski (Lipski), the respondent's executive publisher and editor; 2. Mark Jack Samuel (Samuel), the respondent's advertising and marketing manager between 1990 and December 1995; and 3. Sandra Giselle Braunstein (Braunstein), who described herself as a sales executive with some three years experience in selling advertising with the respondent. The applicant gave evidence on her own behalf. BACKGROUND The respondent publishes on a weekly basis a newspaper called the Australian Jewish News. The newspaper has a magazine section published monthly as well as what the witnesses referred to as street features, promoting different areas from time to time. The respondent sells advertising space in all the segments of its publication with the lead time for obtaining advertising for, for instance, the monthly magazine being no less than two weeks before publication. To sell the advertising space the respondent employs a number of sales staff whose job it is to canvass for sales both door to door and by telephone. The applicant is a woman who, before accepting the position with the respondent, had not been employed for some six years or so. She has experience in America in retail and telephone sales, however, both parties accepted that the position offered to her in 1994 was one where no experience was required with the expectation being that the respondent would train any suitable candidate. The applicant was referred to the respondent by the Jewish Welfare Organisation, which as part of its operation appears to provide assistance in introducing people to prospective employers. In this case the introduction led to the applicant being interviewed by Samuel in mid December 1994 and shortly thereafter receiving an offer of employment on the following terms and conditions (Exhibit A1): "Dear Eva It is with great pleasure that I would like to offer you the position of advertising sales representative with The Australian Jewish News. As a sales representative with our paper your package will consist of the following: (a) A salary of $26,000 per annum. (b) A car allowance of $150 per week. This allowance covers all expenses such as wear and tear, registration, insurance and servicing. (c) A commission of 7.5% will be paid on sales per week above $3,500 per week, paid on a monthly basis. (d) A $25.00 per week petrol allowance. This allowance will be paid on receiving a receipt for this petrol. Your hours of work will be from 9.00am to 5.00pm with a half hour lunch break 5 days per week totalling 37.5 hours per week. Four weeks annual leave will be awarded after a 12 month qualifying period. At least six weeks notice must be given. Award superannuation, sick leave and other conditions as set out in the state commercial travellers award. We would like you to commence employment on 16/1/95. When you commence work could you please return a copy of this letter signed showing your agreement to the above conditions to Patricia Fawcett. Congratulations again" The offer was duly signed and returned to the respondent with the applicant commencing her employment on 16 January 1995. Although Samuel, the author of the letter of offer, claimed that the letter contained the terms and conditions of the applicant's employment he did so on the basis that he relied on, first, what he claimed was the clear meaning of particularly paragraph (c) of the written offer of employment and, secondly, the factual matters he alleged were discussed at interview as either circumstances which should be taken into account in construing the meaning of paragraph (c) or presumably oral terms of the contract of employment not wholly reduced to writing. It was not asserted by the applicant that the parol evidence rule applied to this contract in the sense that the agreement between the parties was wholly reduced to writing with matters discussed before the offer of employment was made having no contractual significance or status to show what the respondent's intentions were when making the written offer. (see Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337 at page 352). It is perhaps understandable that the applicant did not seek to confine the case to the written document in circumstances where she too relied on the oral representations made to her at interview concerning Samuel's assurances that she would receive training and that the respondent would be "happy" if it took three, six or even twelve months for her to learn and be trained fully in sales. Samuel agrees that he made a statement to this effect at interview. The statement is clearly a promissory one and should be treated as a term of the contract of employment; although what was intended by this promise must be considered in the context of the whole agreement. In other words, can it be said that after looking at the whole contract it was intended that the respondent would persist with up to twelve months training regardless of the level of performance the applicant achieved in say three months or six months time? THE EVIDENCE It is alleged by the respondent that paragraph (c) of the written contract should be interpreted to mean that not only was the applicant to be paid each month a 7.5% commission on weekly sales exceeding $3,500, but also that there was an agreed weekly sales target of $3,500; that is to say, sales actually made as distinct from those merely written. Relying only on the written document both contentions are unsustainable just by reference to the ordinary meaning of the words used. So that for the Court to decide what the respondent's intention was and what, if any, terms of the contract were oral it is necessary to have regard to the alleged statements made at interview and all the surrounding circumstances. Bearing in mind that the applicant attended the interview on the basis that she offered no experience in the sale of advertising space in a newspaper, it is reasonable to assume that her understanding of the terms and conditions of her employment were shaped by what Samuel told her at interview about the respondent's requirements of her should she be offered the position. Samuel told the Court that as the advertising and marketing manager he had a sales budget to meet and the advertising sales representatives who worked under him were there to help him achieve this budget, which was determined by the revenue collected in the last twelve months and market trends. If his sales representatives were under-performing that affected his performance and attracted criticism of him. Lipski gave evidence that at the relevant time there was some pressure on the revenue of the newspaper because of the decline in the property market and advertising related to this. To determine the advertising sales representative's working budget or target, according to Samuel the respondent applied an industry standard of five times the employee's salary. In this case the applicant who was employed on $26,000 per annum with a $150.00 per week car allowance (a total salary of $33,800 per annum, a salary allegedly reflecting her inexperience), was expected to write $169,000 worth of sales per annum. This was then translated by the respondent into a target of $3,500 per week in sales. Samuel was unable to explain the discrepancy between this weekly figure and the sum of $3,250 which should have been the target sum if the annual figure of $169,000 was divided by 52 working weeks. I found it difficult to accept that an industry standard was determined without allowance for, for example, four weeks annual leave during which no sales would be written making it impossible to achieve the annual target figure of $169,000 if the sales representative only met the weekly target. In effect what Samuel was saying is that the $3,500 per week target was an approximate sum and was higher than the alleged industry standard of five times the applicant's salary. I infer from this evidence that if there was an industry standard for setting targets, Samuel did not feel bound to observe this, setting targets independent of such standard. The Court was told that the target attributed to the applicant was less than that of the other experienced advertising sales representatives who had targets of greater than $4,000 per week and who presumably earned greater salaries. Despite the absence of any clear term in the letter of offer to this effect, the Court was told that the target was a fundamental term of the applicant's employment and it was the applicant's persistent failure to meet the target set from time to time which ultimately justified her termination. The alleged target of $3,500 per week related to sales of advertising space where the sale was finalised; being credited to the sales representative in the week this occurred. Accordingly, the fact that a sales representative, including the applicant, may have canvassed and written sales of many thousands of dollars in any one week was not considered in the analysis of the targets and the employee's performance unless the advertisement was published. In achieving the target an advertising sales representative did not get credit for obtaining clients outside the regional area the representative was allocated. This meant that if, as in the applicant's case, she obtained clients such as Sothebys in Armadale or Luna Park, the clients were referred to the advertising sales representative for their particular region, these people taking the benefit of any sales from the clients. It was also the case that if other advertising sales representatives had regular clients who also happened to be in another representative's territory, they could keep those clients and the territory representative was precluded from canvassing the clients belonging to the other advertising sales representative. Moreover, if an advertisement did not go to print because of some error on the part of the respondent, any loss of sale and the giving of free advertising to the client to recompense them for the error was not credited to the sales representative's target figure. It was not disputed that this occurred where there was a misprint in respect to one client's advertisement for a sum of $1,200.00. The respondent gave the client $1,200.00 worth of free advertising and the applicant lost the benefit of this sum in her sales figures. Further, it was the applicant's uncontested evidence that in one instance the respondent missed a deadline and as a result she lost the client and the sale. Samuel accepted that these events could happen and affect the level of sales, however, he denied that any of the matters referred to by the applicant in her case had any real effect on the revenue generated by her. Samuel did not substantiate this observation. Arguably, a $1,200.00 deduction from any weekly sales target could be the difference between achieving the target or not. The reason for setting out the abovementioned matters at this juncture is to draw attention to the sorts of matters not covered at all either in the interview or the letter of offer accepted by the applicant, who because of her lack of experience in this type of sales, was not aware of the true basis upon which her performance would be assessed once she commenced her employment with the respondent. In keeping with the written terms of the offer the applicant claims that at no stage prior to her acceptance of the employment offer was she informed that there was a weekly target to be met of $3,500. It is Samuel's evidence that when he interviewed the applicant in December 1994, he was aware that she had no face to face experience in selling advertising space. His approach to hiring sales people was to apply the formula that if the person presented well in interview then he would "give them a go". This approach is consistent with the representation he agrees he made to the effect that if it took up to twelve months the applicant would learn the job and be trained by the respondent. At face value this representation is incompatible with the alleged "fundamental" term of her contract that the applicant achieve weekly targets of $3,500, unless consideration is given to the intentions of the parties when agreeing to this term. At interview Samuel described the applicant as well presented and confident. He alleges that the interview of some 45 to 60 minutes covered the applicant's past history and what the job being offered entailed. More specifically, he claims to have gone through all the matters subsequently contained in the letter of offer, explaining to her that her duties involved door to door sales, telephone canvassing and selling advertising space for the health and beauty segment of the newspaper, with some street selling. The lastmentioned item refers to the sale of advertising space in the newspaper's street features where a particular street such as Acland Street, St Kilda is the subject of a feature with advertising accompanying it. In his evidence-in-chief, Samuel alleges that he told the applicant "how the sales targets were achieved". He gave this evidence without really elaborating on what he actually recalled saying on this matter. On the more significant point of whether he had referred to sales targets, he alleges telling the applicant that the "normal sales targets were $3,500". This evidence is, however, inconsistent with his and Lipski's evidence that the other sales representatives' targets were then $4,000 or greater. Again, there was no elaboration of the context and circumstances surrounding the making of the alleged statement. When asked by the respondent's representative what he was referring to in paragraph (c) of the letter of offer, Samuel rose to the occasion by saying that, although it did not mention a target as such, this was "what it refers to". In cross-examination Samuel agreed that in hiring the applicant it was his intention to train her to a point where she achieved sales of $3,500 per week, again underscoring the literal incompatibility of this intention with any strict interpretation of the letter of offer allegedly requiring that she achieve these sales levels immediately. When tested on whether he actually used the word "target" in interview, Samuel responded by saying that he had referred to the "level" of $3,500 and on anything above that the applicant would earn commission. Further, when it was impressed upon him that the letter of offer failed to mention any target he responded by saying that that was the point of referring to $3,500 in paragraph (c) of the letter because the applicant had to attain this figure before she received any commission. Pressed further on the omission in the letter of offer, he agreed that it did not say what he says it meant, however, he then made some reference to "this" having been said in other counselling sessions. I understood his answers to mean that from about 18 April 1995, when he had cause to remonstrate with the applicant over her performance, the requirement to achieve a target of $3,500 per week was spelt out. The applicant's recollection of the interview and particularly the details of the terms and conditions upon which she would be employed if the job was offered to her, is not at great variance with that of Samuel, other than on the critical issue of whether targets were mentioned. On the question of the payment of commission her evidence-in-chief was that "he (Samuel) said that there would be a commission on anything above the expected earnings ... but there was no real discussion on that ... he didn't elaborate on expected earnings". She categorically denied any mention of targets; recalling only a reference to 7.5% for commission, but no mention of $3,500. Not surprisingly, the respondent seized on the applicant's reference in her evidence-in-chief to "expected earnings", essentially challenging in cross-examination the credibility of the applicant's claim that during the course of the interview and after being told that she would receive 7.5% commission above expected earnings, she did not at any stage ask what the expectation was. She told the Court she had an outline of the duties but not what was expected of her in dollars. But for the concession made by the applicant, Samuel's evidence coupled with the failure of the letter of offer to state clearly that there was a target to be met against which the applicant's performance would be measured, would not have been sufficient to satisfy me that there was at interview a reference by Samuel to a target. However, whether one uses the word "target", "level" or "expected earnings" it does seem that at the very least the applicant was informed that there were expected earnings, and for sales above this figure she would receive a commission. If the amount of those earnings was not identified at interview then it was certainly identified in the letter of offer. Because of these matters, I am satisfied that at the date of accepting the offer of employment the applicant knew that there were expected earnings of $3,500 above which she would receive the commission specified. What she did not understand, and the gaps in Samuel's evidence allow this conclusion to be drawn, is that sales were treated by the respondent in such a way that for her to achieve expected earnings it was not simply a matter of just writing sales in any one week. Moreover, she could not have appreciated then as she came to through experience with the respondent, that she would not be credited with acquiring clients unless she made sales from them; nor would she be credited, for instance, with sales where through no fault of her own there were misprints or failures to meet deadlines resulting in the loss of a sale or the granting of free advertising to the client. Lipski recoiled from describing the sales business as "cut-throat", preferring to refer to it as "competitive". However, to the uninitiated the difficulty in achieving a weekly target or expected earnings may only become apparent through the sometimes bitter experience of finding that; for instance, your client belongs to another sales person's region and that person acquires the benefit of any sale obtained without any formula for recognising your role in achieving the sale. Notwithstanding Lipski's diffidence on the subject some may find that the respondent's narrow interpretation of sales and thereby its narrow analysis of performance could lead to a "cut-throat" environment. The applicant commenced her employment on 16 January 1995 and worked for some two weeks before Samuel returned from leave. It was suggested by the applicant that when she presented for work there was no arrangement in place for her to be trained and by default, rather than design, Braunstein took on the task of showing the applicant around and giving her some basic hints. In contrast, both Samuel and Braunstein claim that there was an arrangement in place for Braunstein to meet with the applicant, help her settle in and assist her in any way needed. I accept their evidence on this matter only insofar as it shows that there was at least some effort made to give her some assistance early in the piece. Nevertheless, I was struck by the failure of the respondent's evidence to show that there was any structured training program in place to help the applicant develop the skills peculiar to the sale of advertising space with the aim of eventually achieving the sales target of $3,500 per week. For example, one would expect that, because it was not spelt out at the time of contracting, the respondent would take early steps to provide the applicant with details of its policy on sales and the assessment of performance. There was simply no evidence given by the respondent's witnesses to show when, if at all, the applicant was told precisely how its sales policy worked. The respondent did not open its case on the basis that it proposed to call Braunstein to give evidence, however, before closing its case it sought to call the additional witness, no doubt to address some of the training issues raised. Braunstein's evidence was that she provided the applicant with some two to three hours' training consisting of showing her the newspaper, going through its parts, showing her lists of population demographics for the newspaper (which allegation is denied by the applicant), referring her to the yellow pages for client contact, offering her a role-play performed on the basis that the applicant declined to play her part of the role, presumably because she was confident she could do it and, taking the applicant with her when Braunstein made a presentation to a potential client. The sum of those items of training was the two to three hour period mentioned. In her evidence-in-chief the applicant alleged that Braunstein attended the last few minutes of her initial interview with Samuel to give the applicant an idea of what the job entailed. I accept that because of the short notice given, counsel for the applicant did not have instructions and did not put this matter to Braunstein in cross-examination. However, the question of the employee's alleged presence during the latter part of the interview was not put to Samuel either. Because of these omissions I have not placed any weight on the allegation made. In any event, this evidence hardly advances the case of either party. If anything, Braunstein's evidence demonstrates how narrow the training given was. She told the Court that she did become aware that the applicant was not meeting her budget but at no time was she asked by the respondent to provide any further training or assistance. This is not really surprising because all the other sales representatives had targets to meet with Samuel also working towards a budget. Because of these constraints it is more probable than not that there was very little, if any, time set aside for training and assisting a novice in the area. The respondent produced to the Court sales figures for five months of sales showing the following total monthly sales achieved by the applicant (Exhibit A3): February 1995 $ 1,440.20 March 1995 $ 6,457.75 April 1995 $ 4,274.20 May 1995 $ 4,464.95 June 1995 $ 6,047.30 1 to 28 July 1995 $ 2,950.15 TOTAL $26,634.55 In only three weeks did the applicant manage to achieve sales of $3,500 or greater. THE APPLICANT'S PERFORMANCE AND WARNINGS GIVEN Because of the poor showing, on 18 April 1995 Samuel met with the applicant canvassing a number of issues which were then reduced to writing in the following memorandum (Exhibit A2): "After our meeting this morning this is a formal record of that meeting. 1. After your 3 month probationary period your performance was not at a suitable level (8-10k per 4 week month). 2. This was the first of 3 formal warnings before employment is terminated. 3. A written report of daily activities is to be placed on my desk by 9.00am each morning. 4. You are expected to sell a 6 page street feature on Acland Street, St Kilda ($6,000) in 2 weeks. 5. If not in the office you must ring in every 3 hours. 6. Eva was reminded of her employment hours ie 9.00am start. Please read this record of interview and if correct please sign." Samuel agreed that at no stage prior to 18 April 1995 was there mention of any probationary period of employment. Indeed, if there was any discussion at all touching on matters relating to training or trial employment it was confined to Samuel's representation that the applicant would learn the sales skills required whether it took three, six or twelve months to do this. Arguably, the belated suggestion that there was a three month probationary period of employment was an early indication of Samuel's somewhat arbitrary style when it came to interpreting the terms of the applicant's employment contract. Another instance of his arbitrary approach is found in paragraph one of the memorandum where he speaks of "a suitable level" of performance being "8-10k per 4 week month". He explained that this referred to an acceptable sales target of $8,000 to $10,000 per four week month where the applicant was still learning. Samuel agreed that this was not discussed as a target prior to the first meeting and formal warning. Interestingly enough, Samuel told the Court that he may have continued the applicant's employment for twelve months if her attitude had been "right" and she was "hungry for knowledge". I understood this evidence to mean that in Samuel's view the applicant could achieve less than the $3,500 target in weekly sales if Samuel was otherwise satisfied by her attitude. By attitude I further understood him to mean a competitive sales ethos and an ability to go out to seek and obtain sales. He did concede that there would have been no warning if the applicant had achieved the lesser sales target referred to in the memorandum, presumably because the right attitude would have been demonstrated by this. None of this information, however, was conveyed to the applicant before the meeting and before the warning was given. If the letter of offer was unclear on what the target was, if any, the first warning did nothing to clarify this matter with the applicant claiming that she was surprised and confused by this turn of events. As to item three in the memorandum the applicant pointed out that she had not been required to provide these reports until the meeting and thereafter she complied. Item four was more problematic. It was Samuel's evidence that by this item he required the applicant to sell in the two weeks following the memorandum, a six page street feature for Acland Street, to be published approximately one month after the memorandum's date. It was his further evidence that the applicant told him that she would try to do this and meet the target referred to in the memorandum. In cross-examination Samuel agreed that the target of $6,000 for two weeks' work on the feature was in addition to the applicant's normal sales; although he claims to have told the applicant that the figures could be made up in any way. This seemed to suggest that so long as she achieved target figures there was flexibility in the way this was done. This, of course, is not at all clear from Samuel's written memorandum formally recording the meeting that day. The evidence also shows that Samuel had raised the ante in this memorandum because apart from selling between $2,000 and $3,500 worth of weekly sales in the ordinary newspaper, it appears from the memorandum that the applicant was also required to sell, for the succeeding two weeks, $3,000 per week of street feature sales. It was not clear from the applicant's evidence whether or not she queried the viability of the Acland Street feature at the meeting on 18 April 1995 or on a subsequent date. Nevertheless it is agreed that she did point out to Samuel that there were street works underway in Acland Street and because of this the shopkeepers had told her to come back some months later when the major works were completed. Despite her protestations it is accepted that Samuel insisted that she achieve the targets asked of her. Notwithstanding this requirement he did tell the Court that if the applicant had achieved $5,500 in sales for the street feature he would not "have been on her back". Again, this or any other margin on the results required were never directly communicated to the applicant. All Samuel could say was that this information was "intimated". At the heart of the applicant's complaint was the confusion she felt through any lack of detailed explanation about how to perform different aspects of her job and Samuel's tendency to, in effect, move the goal posts around. She also pointed to her difficulty in raising her concerns with Samuel where on one occasion when she queried the contents of a memorandum, he slammed his hands on the desk and told her to get out of his office. This episode he conceded and attributed it to what he called the applicant "going around in circles", presumably in her discussions with him over the contents of the memorandum. He conceded further that he was "frustrated" with the applicant and felt that she was deliberately confusing matters. It is Samuel's contention that at all times he was ready and willing to offer assistance to the applicant in developing her sales but she either neglected to ask for this assistance or declined to join him when he suggested some role-playing activities. The latter allegation being denied by the applicant. She claimed that with the progression of time she interpreted Samuel's behaviour as intimidating and because of this the applicant told the Court that she did not believe herself to be in a position to approach him; much less receive any constructive assistance. In relation to the Acland Street feature the applicant pointed out that she was none the wiser on what precise area she should canvass when dealing with this feature apart from the street itself. Samuel seemed to think that it was self-evident that she should have expanded her sales enquiries into the streets surrounding the main shopping street; not showing any preparedness in Court to concede that the street works could have deterred shopkeepers from advertising until the disruption had ceased. Commonsense suggests that it is more likely than not that Samuel, who was anxious to maintain his budget, did from time to time suggest ways to the applicant of achieving her targets, however, there was little in his evidence to show that he approached the problem in a constructive way; relying primarily on the warnings couched in confusing instructions and contained in the various memoranda directed to the applicant. Items five and six in the memorandum dated 18 April 1995 were not essential to the parties' cases, although there was dispute about whether the applicant had been late for work on more than the one or two occasions she conceded. This obviously exacerbated the difficulties the parties had in dealing with her failure to achieve the sales targets required. The applicant failed to achieve the target referred to in the memorandum of 18 April 1995 and by 5 May 1995 a further meeting with Samuel took place concerning her performance. Samuel produced to the Court Exhibit R2 which was his second memorandum to the applicant identified as the second of three formal warnings before termination of her employment. The document produced in evidence by the respondent contained numerous written alterations made by Samuel as well as a handwritten statement by the applicant under her signature. What appears to have happened is that after the second meeting and the memorandum being given to the applicant, she signed it subject to the following rider: "please note that the actual reason for this 2nd warning is not clear to me & I do not sign this in agreement with content." On receipt of the signed document Samuel reworked the memorandum and on 8 May 1995 produced the reworked version which was signed by the applicant who also inserted a number of written comments next to various paragraphs as well ticks beside other paragraphs. Exhibit A8 is a copy of the document the applicant first received and signed, setting out the record of the meeting and the second warning, with the applicant's handwritten rider. It makes the following five points: "1. This meeting was attended by myself, Eva Hurskin and Tricia Fawcett. 2. This was the second formal warning of 3 warnings before employment is terminated. 3. The reasons for the second formal warning: (a) The street feature for Acland/Fitzroy Streets which was agreed between Mark Samuel and Eva Hurskin would produce 6k in 2 weeks, unfortunately after 3 weeks the equivalent of 2k was sold which is not up to an acceptable level of performance. (b) A 9.00 am starting time has not been adhered to. 4. It was agreed that the terms outlined in the memorandum of 18/4/95 ie point 1,3,5 and 6, would still be adhered to. 5. You are expected to sell 2 extra pages on Health and Beauty ie 2k by Wednesday 17/5/95." It is not necessary to set out the workings on the document referred to as Exhibit R2 as Exhibit R3, the memorandum dated 8 May 1995, contains these and the substance of the memorandum is reproduced below: "1. This meeting was attended by myself, Eva Hurskin and Tricia Fawcett. 2. This was the second formal warning of 3 warnings before employment is terminated. 3. The reasons for the second formal warning: (a) The street feature for Acland/Fitzroy Streets which was agreed between Mark Samuel and Eva Hurskin would produce $6,000 sales in 2 weeks, unfortunately after 3 weeks the equivalent of $3,000 was sold which is not up to an acceptable level of performance. This is still half of what is required as a suitable level as per item 1, of memo dated 18/4/95. (b) A 9.00 am starting time has not been adhered to. 4. It was agreed that the terms outlined in the memorandum of 18/4/95 (attached) ie point, 1,3,5 and 6, would still be adhered to. 5. You are now expected to sell 2 extra pages on Health and Beauty ie $2,000 by Wednesday 17/5/95 for the June edition of Good Living." The abovementioned memorandum contains ticks against paragraphs one, two, four and five. In the margin when signing, the applicant circled the word "agreed" in paragraph 3(a) writing next to it that, "No agreement was entered into - I promised to TRY and that I would give my very best effort". In paragraph 3(b) the applicant circled the word "not" and wrote under it, "I disagree to (b)". Lastly, next to paragraph 5 she wrote, "Once again the very most that I can do, is try my very best!". In cross-examination Samuel conceded that the memorandum could have caused the applicant some confusion. For instance, the Acland Street feature referred to in the April memorandum had been advanced to an Acland/Fitzroy Streets feature and Exhibit A8 at paragraph 3(a) refers to sales after three weeks of the equivalent of $2,000 when in fact there were sales of $3,000. He did agree that throughout his dealings with the applicant she consistently questioned and disagreed with the targets set, but on each occasion that she was required to reach different targets, agreed that she would try to do this. By 8 May 1995 under item five of the memorandum of that date the applicant was then required to sell two extra pages on health and beauty amounting to $2,000 in sales within nine to ten days for the respondent's 'Good Living' supplement in the month of June 1995. The applicant correctly directed the Court to the confusion caused by the use of the word "extra" in that item because she interpreted this to mean in addition to the Acland Street sales. Samuel's evidence was that it meant $2,000 only for that period. On the following day, 9 May 1995, Samuel provided the applicant with a further memorandum entitled "Comments on Memorandum dated 8/5/95" (Exhibit R4). It said: "As you appear not to understand my remarks regarding your unsatisfactory standard of performance, I will re-iterate our companies (sic) stance re this matter. We now insist your sales for the next week to be 2 more pages in the June edition of Health and Beauty, with a revenue total of $2,200 by Wednesday 17/5/95. Anything less will be viewed as an unsatisfactory result. I do hope this clears up any misunderstandings you may have." Beneath the typed comments Samuel inserted the following handwritten statement: "If you do not make the above company standard this will represent a 2nd Warning". The document was signed by both he and the applicant. The effect of the warning given is that it is self-executing in the sense that it does not contemplate any opportunity to explain any failure to meet the target before the warning takes effect. Further, it, as with the other warnings given, appears to relate to non-compliance with any of the issues referred to in the memoranda, from the more trivial items such as not telephoning the office every three hours to not reaching the new targets. For reasons best known to Samuel, within one day the target had shifted from $2,000 to $2,200 and a second warning was spelt out regardless of the explanation given by the applicant that she was unable to achieve the particular Acland Street target because of the works being conducted in that street. I accept her evidence that her effort to achieve this specific target was impeded by events outside her control and this would normally be a matter an employer, acting reasonably, should regard as a mitigating circumstance. If anything, Samuel's behaviour in ignoring these circumstances reflects the pressure he was under to meet his own budget without any real interest in how the applicant was to meet his requirements so long as she did so. Matters deteriorated further for the applicant in June 1995 when on 6 June 1995 she was involved in a motor vehicle collision in which her son was injured. She took one week's compassionate leave to 15 June 1995 and, because of accrued sales, she appears to have still shown sales for the week ending 16 June 1995 and for the week ending 23 June 1995 when in that week she achieved sales of $3,944.65. This figure dropped to $513.00 by the week ending 30 June 1995. Exhibit A4 produced to the Court by the applicant is a copy 'Daily Activity Report' for the week ending 2 June 1995 which was a week when the respondent only recorded $69.00 in sales for the applicant. What the report shows, however, is that in that week she wrote client advertising orders to the value of $4,897.00 but, because of the respondent's system for recording sales, her performance for that week was assessed solely by reference to what had occurred in the earlier weeks. It is probable that during the period of her compassionate leave at least some of the client orders obtained by 2 June 1995 crystallised into actual sales. In fact, in the three weeks she did work in June 1995, her total sales recorded of $6,047.30 demonstrate a marked improvement. If extrapolated over the three weeks worked, they would average sales of $2,000 plus each week in keeping with the minimum target referred to in the April memorandum. Within two weeks of the applicant returning to work she received the following memorandum dated 30 June 1995 regarding her performance (Exhibit R5): "Regretfully after analysing the results of sales representatives at the end of June 1995, it has become obvious that your performance to date is still below a satisfactory level. As a result I am forced to remind you that you have had one formal warning of the 3 warning process prior to employment being terminated. I understand your problems physically and the car accident you have experienced but I have a sales department to run and if one cog is struggling we must address the situation. (1) You must have $2,000 worth of revenue in the issue of 14/7/95, if not this will result in a second warning. (2) You must have $4,500 worth of revenue in the issue of 21/7/95, if not this will result in a third and final warning and your employment with the Australian Jewish News will be terminated. As of Monday 3/7/95: (a) A written activity report is to be placed on my desk by 9.00 am each morning. (b) If not in the office for more than 3 hours you must ring and inform me or your movements. (c) You are required to be in the office by 9.00am sharp and finish work at 5.00pm and if you cannot adhere to these hours you must ring me personally on 0414 374 184. If you do not adhere to any of the above conditions this will result in a formal warning or termination. Please note that all your sick leave entitlements have been used up ie 5 days per year of service and any days taken off even with medical certificates will be deducted and will not be payed. Please sign below if you understand the above terms and conditions." She did not sign this last memorandum. Samuel alleged that the lastmentioned memorandum came about after he met with the applicant on her return from compassionate leave and informed her that she was required to achieve the targets expressed in that memorandum. This, he alleged, was done at the same time as offering to assist her. By the time the applicant received the memorandum the applicant had lost count of the number received and, not surprisingly, was confused about both the targets and the warnings. She denied being offered any help by Samuel with the sales and, because of the confusion she felt as well as her belief that she was being intimidated, she arranged to see Lipski on 5 July 1995. Just concentrating on Exhibit R5, it was conceded by Samuel that to achieve the target in paragraph one of that document the applicant could only sell advertising in the newspaper itself, the deadline for the sale of advertising in any supplement having already passed. This was obviously an important matter for the applicant who, even on Samuel's evidence, was comparatively more successful in her sales of health and beauty advertising in the supplement. It is the applicant's evidence that she protested because of the deadline and was told by Samuel that he had a budget to meet. It was only after the applicant's discussion with Lipski that the first target was modified. It follows that if it was not reasonable to threaten a second warning in item one of the memorandum, the threat of a third warning in item two was also inappropriate at the time it was made. Although the memoranda purport to raise warnings vis-a-vis the applicant's times of attending, reporting in and the submission of written activity reports, the respondent did not seek to justify the termination by reference to these matters concentrating specifically on the failure to meet the monetary targets. It was conceded by Samuel that the applicant appeared to do her best and because of the incident where he had ordered her out of his office she was prompted to go and seek an audience with Lipski; Lipski subsequently raising with him (Samuel) the matters relating to the applicant's recent domestic problems and the efforts she was making to achieve the targets. The applicant described Lipski as being courteous, receptive, polite and willing to listen during their meeting. His evidence was that the applicant was very distressed because of the warnings received and because of Samuel's attitude towards her. She claimed to be trying to do her best but alleged that she had not been given sufficient opportunity to improve her performance. She further claimed that the targets set were unfair. She made reference to the motor vehicle accident and her responsibility as a single mother; pointing out that she was an intelligent person capable of learning but that she had not received much guidance on what was required and had been left largely on her own resources. She asked for more time to learn and more understanding from Samuel. The applicant's version of the conversation is not really at odds with Lipski's, although she placed more emphasis on having suggested that Samuel applied a different set of rules to her, with changes being made that did not accord with her contract. Significantly, Lipski told the Court that he agreed at that meeting to discuss with Samuel further training of the applicant as well as to arrange to extend the deadlines for the targets required. Lipski obviously had some prior knowledge of the applicant's alleged under-performance because he also suggested to the applicant that she, like he, may not be suited to work as a door to door salesperson and because of this should consider looking for employment elsewhere. The applicant resisted this suggestion claiming that she could achieve good results if she had proper support to do so. Lipski conceded that by that time the applicant and he met he had formed the view that the applicant was not capable of meeting the respondent's performance requirements. Lipski told the Court his subsequent enquiries concerning the training received led him to the conclusion that the applicant had been given opportunities which were declined by her and had been taken out on location to meet clients. This last comment I understood to refer to Braunstein's three hour training session in January 1995 which included the visit to her potential client to make a presentation, as well as allegations by Samuel that he had offered to perform role-playing with the applicant and such offers as were made were declined by the applicant. In cross-examination Lipski agreed that the applicant also complained about Samuel using offensive language in front of her, in addition to the incident where he ordered her out of his office. There was an allegation by the applicant that Samuel, on at least one occasion, said "fuck" in her presence. He contends that it was not his habit to swear at work but he may have said "bloody hell" from time to time. When the allegations were put to him by Lipski, Lipski told the Court Samuel denied them. On the evidence I am not satisfied that Samuel was prone to using offensive language in the office even if there was the odd occasion when he used an expletive to express his frustration. Notwithstanding this observation, however, I am satisfied that Samuel, by his behaviour, did act in a bullying and intimidating way towards the applicant from time to time, the probability of that behaviour occurring being borne out by, not only the documentary evidence, but also by his belief he had that she was in some way deliberately confusing matters. The inference I draw from Lipski's evidence is that whilst he was sympathetic during his meeting with the applicant and took steps to arrange for an extension of time in which to meet the obviously unreasonable targets raised on 30 June 1995, he accepted Samuel's explanation of Samuel's conduct. He also accepted that proper training had been given and that the failure of the applicant to reach the target, was then attributable to her lack of skill in this type of sales. The result of his acceptance of these matters was that the applicant made very little headway on the issue of training and guidance because the subsequent memorandum focussed primarily on an adjustment to the first target set. This adjustment did not accord with the agreement reached in the discussion with Lipski concerning both targets and my understanding of Lipski's evidence that he spoke to Samuel about targets, meaning both the targets referred to in the memorandum. The memorandum dated 6 July 1995 regarding sales targets (Exhibit R6) was published as a consequence of the discussions and it told the applicant that: "After consultation with Sam Lipski regarding your targets and performance, I am reminding you of your sales targets for the remaining weeks in July. (1) In the edition of 21/7/95, you must sell advertisements to the value of $4,500 in that edition. (2) In the edition of 28/7/95, you must sell advertisements to the value of $3,000 in that edition. If you require any assistance, please do not hesitate to ask." It is evident from the memorandum that the focus of the memorandum was to amend the times and amounts required to be met with regard to one target only; the only concession to training being an offer by Samuel of assistance if asked. This hardly constituted training or guidance or a commitment to further training. With regard to the first item for 21 July 1995, Samuel conceded that by the date of the memorandum dated 6 July 1995, the deadline for the July supplement could have already passed. It was also contended by the applicant that the deadline for meeting item two was within a day or so of the memorandum and these matters were raised with Samuel who was not at all responsive. She pointed out that in any event her employment was terminated on 27 July 1995; one day before the target date in item two of that memorandum. I am satisfied on the evidence that it would have been obvious to Samuel that by 6 July 1995 the deadline had passed for the selling of at least the advertisements in the supplements in the edition of 28 July 1995 and the applicant had not and could not hope to meet the target. Exhibit R7 is a further memorandum from Samuel to the applicant; this time stating: "As stated in memorandum dated July 6, 1995, I wish to advise that once again your level of sales for the edition of 21/7/95 was under target ie $2,365 actual sales against $4,500 target sales. This is yet again an unacceptable standard of performance for this company therefore a second warning is in place. I wish to reiterate that your target sales for the edition dated 28/7/95 is $3,000. I wish you every success in obtaining this sales target and if you require any assistance, please do not hesitate to ask." Despite the more positive attitude expressed by Samuel in the last part of the memorandum, it appears that by 24 July 1995 the deadline for the edition dated 28/7/95 should have passed and the applicant would then have not been in a position to meet the requirement spelt out on 6 July 1995; much less on 24 July 1995. During July 1995 the applicant took a number of sick leave days with medical certificates being provided. On 27 July 1995, by a memorandum bearing that date, Samuel terminated the applicant's employment for the following reasons (Exhibit R8): "As stated in memorandum dated July 6, and July 24 1995, I wish to advise that once again your level of sales for the edition of 28/7/95 was under target ie $914.50 actual sales against $3000 target sales. This is yet again an unacceptable standard of performance for this company - therefore a third warning takes effect. As a result, I am forced to terminate your employment as of 27/7/95 and you will be paid a weeks notice and all entitlements. I wish you all the best for the future." Samuel conceded in cross-examination that he did not have any regard to any sales made or placed for any newspaper edition following 27 July 1995. It was also apparent at hearing that until the hearing date the respondent had neglected to pay commissions owing on the three weeks of sales exceeding the target figure of $3,500; Lipski denying any knowledge of this omission until the hearing. Samuel also provided the applicant with a reference dated 31 July 1995 to the following effect (Exhibit R9): "To whom it may concern Eva Hurskin has been an employee of The Australian Jewish News since 16/1/95 to 27/7/95 in the capacity of Advertising Sales Representative. Her duties as sales representative included: (1) Telephone appointment canvassing. (2) Door to door sales. (3) Face to face sales presentations. (4) The design of advertising copy. (5) The writing of advertising directories. During her period of employment I found Eva to be a person of integrity and a pleasant and courteous worker and showed a genuine interest in all matters of work. Eva has a pleasant disposition and was well liked by other members of staff. If any future employer requires further information about Eva please do not hesitate to contact me." The applicant's termination pay consisted of her entitlements to 27 July 1995 with one week's pay in lieu of notice in the sum of $500.00 and a car allowance paid at $100.00, being $50.00 short of the actual weekly allowance. Again at hearing that $50.00 was conceded but not the additional petrol allowance. When giving the applicant the notice of termination Samuel told her that, "unfortunately she had not obtained the target set, it was her third and final warning" and because of this he was then forced to terminate her employment. The evidence shows that the applicant left shortly thereafter. SECTION 170DC - PROCEDURAL UNFAIRNESS At the final meeting it is clear that there was no opportunity granted to the applicant to explain the failure to meet the last target which, because of the matters I have already addressed, was obviously an unreasonable one. In Nicolson v Heaven and Earth Gallery Pty Ltd (1994) 1 IRCR 199, Wilcox CJ explained the impact of section 170DC(1) of the Act in the following way: "The paragraph does not require any particular formality. But this does not mean that it is unimportant or capable of profunctory satisfaction. Section 170DC carries into Australian labour law a fundamental component of the concept know to lawyers as "natural justice" or, more recently, "procedural fairness". The relevant principle is that a person should not exercise legal power over another, to that person's disadvantage and for a reason personal to him or her, without first affording the affected person an opportunity to present a case. The principle is well-established in public administrative law. It was accepted into international labour law when Art 7 was inserted in the Termination of Employment Convention. Section 170DC is directly modelled on Art 7. The principle is, I believe, well understood in the community. It represents part of what Australians call "a fair go". In the context of s 170DC, it is not to be treated lightly. The employee is to be given the opportunity to defend himself or herself "against the allegations made"; that is, the particular allegations of misconduct or poor performance that are putting the employee's job at risk. Section 170DC(1) is not satisfied by a mere exhortation to improve." I am not satisfied on the evidence that an opportunity to explain such as is envisaged by section 170DC was afforded to the applicant and because of this there was a contravention of the procedural fairness provision of the Act. POOR PERFORMANCE AS A BASIS FOR DISMISSAL On the evidence this is not a case where there was any representation or warranty given by the applicant as to her competence to perform the type of sales duties envisaged by the contract of employment (see Harmer v Cornelius (1858) 5 C.B.(N.S.) 236 at 246 to 246 and Printing Industry Employees' Union of Australia v Jackson & O'Sullivan Pty Ltd (1957) 1 F.L.R. 175 at page 178). On the contrary, it was well understood that the applicant required training and was induced by the promise made by Samuel to attempt the job and try and achieve the targets set because of the expectation that she would receive proper and ongoing instruction. If the sales figures produced to the Court by the respondent are taken in isolation, they show that the applicant consistently failed to reach the contracted target of $3,500 per week; much less the targets adjusted from time to time. In itself, however, this failure is not decisive of the issue because of the evidence of the unreasonableness of some of the deadlines and targets set from time to time as well as the warnings associated with her failure to meet the targets set. It is not for the Court to say that the applicant was incompetent just by reference to the figures produced because such a conclusion would ignore the countervailing factors and the obligation the respondent had to properly instruct the applicant. One of the tenets of the law relating to the construction of contracts is that performance of contractual obligations as construed by law is required. Accordingly, as a first step the Court must ascertain the objective intention of the parties. The evidence supports a conclusion that the objective intention was to train the applicant to meet the appropriate targets. The concessions made by Samuel in evidence indicate that if the applicant had achieved lower targets this would not have been inimical to the performance of her obligation to achieve sales. However, at some stage subsequent to the commencement of the contract of employment Samuel decided that the applicant did not have the right attitude to the job; believing also that she was deliberately raising matters of confusion. That decision was made in circumstances where Samuel also contended that it was not her failure to achieve the targets set that brought about his decision, because he was flexible in his application of targets to a learner. It was, he claimed, because of her attitude. This I understood to refer to his belief that she was in some way deliberately confusing the matters. I am, however, satisfied that contrary to what was alleged against her the applicant at all times indicated that she would and did try to meet the requirements imposed on her by Samuel. This was done despite the arbitrariness of those requirements and the unhelpful position taken by Samuel. My conclusion is that on any view of the evidence the applicant's initial agreement to achieve sales targets of $3,500 or greater was subject to the respondent's promise to provide proper and ongoing training over a reasonable period. In other words, it was not the intention of the parties that the respondent would train the applicant for twelve months regardless of her level of performance in that period. When Samuel realised by April 1995 that the applicant was not producing the sorts of results needed for his budget, he unilaterally introduced the notion of a three month probationary period and thereafter varied the targets and instructions to the applicant in ways which were both confusing and, in some instances, unreasonable having regard to the times different editions and parts of the newspaper were published. Because of this behaviour there is no certain basis for asserting that it is more probable than not that at the date of termination the applicant's poor showing on the figures was entirely related to her lack of competence. Indeed, the respondent carries the burden of proving that the applicant was incompetent in the sense that she was not capable of performing the tasks required of her and did not reach the standard of performance agreed. The object of Division III Part VIA of the Act is to give effect or further effect to both the Termination of Employment Convention and the Termination of Employment Recommendation (see s 170CA(1) and Schedules 10 and 11 respectively to the Act). Paragraph 8 of the Recommendation says: "The employment of a worker should not be terminated for unsatisfactory performance, unless the employer has given the worker appropriate instructions and written warning and the worker continues to perform his duties unsatisfactorily after a reasonable period of time for improvement has elapsed." Even without the promise to train the applicant and Lipski's additional promise to discuss further training with Samuel, it is clear from the Recommendation that before unsatisfactory performance is relied upon as a justification for termination there should be appropriate instructions, written warning and a reasonable period of time for improvement. What amounts to appropriate instruction and a reasonable period of time for improvement will vary from one case to another. Nonetheless it can generally be said that the instructions, whether by demonstration or in writing, need to be unambiguous and capable of being performed if they are to become the basis for a warning or warnings. They should also envisage a reasonable time for improvement and compliance so that in the present case where sales are cumulative over a number of weeks, the time for improvement should take account of this factor. Viewed objectively, the applicant entered into an employment contract that initially set a standard of performance determined against a number of criterion not known to her before she agreed to train in the position. There was no evidence called by the respondent from which the Court could determine when the respondent's policies on the attribution of sales were advised to the applicant. By looking at the various memoranda it is impossible to understand what the targets were, as they varied from time to time. For instance, from 18 April 1995 should the general target be assumed to have been between $2,000 and $2,500 for a four week month, $3,500 or some other figure? It is not the role of the Court or, indeed, the object of the legislation to require employers to keep on under-performing employees. Notwithstanding this observation, the employer does carry the burden of proving that there is a valid reason or reasons for termination connected with the employee's capacity. The Court has had numerous occasions to consider the meaning of the expression "valid reason" in this context and, perhaps the most often quoted statement is that of Justice Northrop in Selvachandran v Peteron Plastics Pty Ltd (1995-96) 62 IR 371 where he interprets that expression to refer to a sound, defensible and well-founded reason for termination. The difficulty confronting the respondent in the present case is that the figures alone and the failure on some occasions to meet various targets do not necessarily provide a sound, defensible and well-founded reason for terminating the applicant's employment when they are analysed in context. Because of this the respondent has not discharged the burden of proof it carries pursuant to section 170EDA(1) of the Act. If I am incorrect in the abovementioned conclusion, I further find that the applicant has, on the evidence, established that the termination was, in all the circumstances, harsh, unjust or unreasonable. This is because the sequence of events I have referred to in some detail above demonstrate; for example, some obvious injustice and unreasonableness in the way the targets were dealt with giving rise to inappropriate warnings. Moreover, the lack of any ongoing training, evidence of appropriate instruction once the respondent formed the view that the applicant was under-performing, or a reasonable opportunity to improve satisfy me that the provision was breached by the termination. It should be added here that the respondent's failure to meet its initial promise of proper and ongoing training over a reasonable period is also evidence of a breach of this provision. REMEDY Reinstatement was not sought by either party even though the applicant has remained unemployed. The applicant specifically relied on the small working environment at the respondent premises, the evidence of the respondent concerning its ongoing budgetary problems in its advertising sales and her disaffinity with the unfriendly and unsupportive working place. Although Samuel is no longer employed by the respondent, it is clear that fairly early in the piece the employer formed the view that the applicant lacked some particular attribute; Samuel described it as "something missing" which made her unattractive to the employer as an advertising sales representative. This view was not prefaced on her poor monetary performance but appears to have had something to do with her lack of a competitive sales ethos. After careful consideration of all these matters I have concluded that reinstatement is impracticable in all the circumstances. The applicant seeks compensation to the maximum provided for by the Act; namely $16,900. She does so by relying on her loss of remuneration from paid employment since July 1995 to the date of hearing, which period exceeds the jurisdictional limit. Further she seeks to be compensated for the distress she alleges she suffered arising out of the circumstances and the manner in which she was terminated. Concentrating first on the loss of remuneration, the applicant pointed to many unsuccessful attempts by her to find paid employment since the termination. However, the period of unemployment and the loss of remuneration since termination is not necessarily decisive of the amount of compensation that should be paid. This is because the Court's attention is directed to remuneration she would have received, or would have been likely to have received had her employment not been terminated (see section 170EE(3)). The sorts of considerations to be borne in mind in assessing this remuneration include, the short period of her employment as well as the fact that the applicant was seeking to be trained to perform a particular kind of work with the risk that even with appropriate training, support and instructions she may still not have reached the level of sales necessary to sustain her employment over an extended period. If the promise of support and training and the need for unambiguous instructions had been actively taken up by Samuel in July 1995, then in my view it would have been reasonable for the respondent to allow her time for improvement for a period of no less than two months, particularly having regard to the cumulative nature of the sales recorded. Accordingly, I have assessed the remunerative aspects of the compensation payable at $5,633.33 gross. The question of whether an applicant can seek compensation in this Court for distress arising out of the circumstances of the termination is still very much open to debate. In his decision in Aitken v The Construction, Mining, Energy, Timberyards, Sawmills and Woodworkers Union of Australia - Western Australian Branch (1996) 63 IR 1, Justice Lee says at page 6: "It is well known that the circumstances and manner of termination of an employee's services can affect an employee's self-esteem and confidence and impact adversely upon the employee's ability to secure further employment. It is, therefore, considered to be in the public interest to ensure that employees whose services are terminated are treated in a fair and reasonable manner enabling them to retain confidence in their self-worth and reducing the prospect that they will have cause to rely on relief payments from public revenue." He goes on to say at page 9 of the same decision: "The compensation to be ordered to be paid under s 170EE(2) is such amount as the Court things appropriate subject to the limit set in s 170EE(3). It is a statutory remedy for which no assessment criteria are prescribed, other than the requirement in s 170EE(3) that the Court have regard to the remuneration that the employee would have received, or would have been likely to have received, if the employer had not terminated the employment. In assessing the compensation that is appropriate the Court will have regard to what is reasonable in the circumstances and will look at what would have been likely to occur had the Act not been contravened (See: Nicolson v. Heaven & Earth Gallery Pty Ltd (1994) 1 IRCR 199 at 211; 57 IR 50 at 61-62 per Wilcox CJ.). The Court will consider the detriment occasioned to the employee by employer's contravention of the Act, and the extent to which it is reasonable to compensate the employee for such consequences. Division 3 of the Act provides the context in which s 170EE is to be construed. It includes provisions intended to protect the dignity of an employee, in particular, s 170EA provides an employee with a right to seek redress in respect of a breach of the act and s 170EE provides the entitlement to receive compensation as the remedy for such a breach, characteristics (sic) of a statutory tort. Therefore, in some cases principles relevant to the assessment of damages in tort may provide assistance in assessing the compensation to be paid under s 170EE(2). That is to say it may be appropriate to include in the measure of compensation to be paid pursuant to s.170EE(2) a sum sufficient to compensate an employee for mental distress or injured feelings caused by a harsh, unjust or unreasonable termination of employment (see: Whelan v Waitaki Meats Ltd [1991] 2 NZLR 74 at 90). If guidance is sought from the measure of damages applied in contract for the breach of an employment contract by wrongful dismissal, damages may be awarded for the breach of an implied term that an employer would not so breach the contract to cause vexation, mental distress, disappointment or frustration to an employee where such an adverse consequence for the employee may be said to have been within the reasonable contemplation of the employer and the employee. (See: Cox v Philips Industries Limited [1976] 1 WLR 638; Whelan v. Waitaki Meats Ltd; see also: Heywood v. Wellers [1976] QB 446; Watts v Morrow [1991] 1 WLR 1421 per Bingham LJ at 1445; Baltic Shipping Co v Dillon (1993) 176 CLR 344 per Mason CJ. at 361-364). It is also appropriate to keep in mind that the purpose of the Act in providing for compensation to be paid to an employee for an employer's failure to abide by the terms of the Act is not only to redress a wrong done to the employee but, in the public interest, to instil greater awareness of, and adherence to, the provisions of the Act. A measure of compensation which addresses the consequences caused by conduct that has breached the Act assists to meet that purpose." The observations of Justice Lee and the basis for awarding compensation for distress apart from that sought in connection with an accrued jurisdiction claim premised on breach of the contract of employment and the payment of damages for distress arising from physical injury occasioned by a breach of contract (see Clunne v Nambucca Shire Council, unreported, Moore J, No. NI 1071 of 1995, 8 August 1995), have been questioned and not followed by some Judges and Judicial Registrars alike in this Court. Notably in Duncan v King Fleight Holdings Ltd (unreported, No. WI 1215 of 1995, 1 August 1995) Patch JR argues generally that, because the principle remedy of reinstatement does not provide for compensation for the distress no doubt many employees suffer, then distress should not be compensable where reinstatement is found to be impracticable and compensation is awarded. Justice Madgwick in Burazin v The Blacktown City Guardian (unreported, No. NI 3718 of 1995, 15 December 1995) described the lastmentioned argument as a powerful one, at the same time as he canvassed a range of persuasions, legal and social, for and against compensation being awarded for distress. More recently in her decision in Brackenridge v Toyota Motor Corporation Australia Ltd (unreported, No. NI 1218 of 1995, 19 April 1996) Justice Beazley, after referring to the passage I have already cited from Justice Lee's decision in Aitken's case, said at page 62 and 63: "With respect to Lee J, I do not agree that damages for mental distress are available under s 170EE. This is clear from the structure of the section. In the case where the court determines that reinstatement is practicable, s 170EE(1) specifies the whole of the available remedy. That remedy is confined to reinstatement in the manner specified in subs (1)(a) and specified in subs (1)(b). Those orders are: such order as is necessary to maintain the continuity of the employee's employment and an order requiring the employer to pay the remuneration which has been lost from the time of termination to the date of reinstatement. It is only if the court considers that reinstatement is impracticable that compensation is payable: s 170EE(2). The amount of compensation is calculated in accordance with s 170EE(3). The reference point in the calculation of compensation is "the remuneration that the employee would have received or would have been likely to receive, had there been no termination". Paragraphs (a) and (b) of subs 3 together with subs 4 provide a limit on the amount of compensation which might be payable. If "compensation" in subs (2) was wide enough to encompass damages for mental distress it would mean an applicant's entitlement to such compensation would be dependant upon the Court's determination as to whether reinstatement was practicable, notwithstanding that the mental distress would have been suffered in any event. In my opinion, s 170EE is directed to compensation for the loss of financial or monetary aspects of employment. It does not encompass other forms of compensation which may be available in respect of other causes of action." As can be seen from Her Honour's observations she relies primarily on a construction of the relevant provisions of the Act for saying that mental distress should not be compensable. In doing so she does not reject the notion of a statutory tort arising if the construction of the provisions of the Act was otherwise amenable to the existence of tortious liability rather than any contractual liability. The applicant gave evidence that she had lost a lot of self esteem and was "shattered" by the termination. She referred to a number of physical symptoms requiring attendance on her general practitioner, which symptoms she believed were induced by the stress associated with the termination and the consequent financial pressures on her as a single parent with two dependent children. No evidence was given to establish that she had suffered mental injury as opposed to the not unexpected emotional and financial consequences of an unlawful termination. It is perhaps trite to say that all employees are vulnerable to some level of emotional distress associated with an unlawful termination and, this is particularly so where the employee has not been in the workforce continuously and depends on the income received to maintain a family. Because I am not satisfied that the applicant, on the limited evidence given, has established compensable distress caused by a harsh, unjust or unreasonable termination, it is not necessary for me to decide in this case the question of whether distress and loss of self esteem should be compensated as one of the elements of loss associated with the unlawful termination of employment other than in the contractual circumstances referred to by Justice Moore in his decision in Clunne's case. Had I been required to deal with the issue and with due respect for all the arguments advanced I must say that I am not persuaded that the structure of the Act decides the issue conclusively against compensation being payable for distress and loss of self esteem. Psychiatric injury or severe emotional distress suffered as a result of an unlawful termination may very well be decisive in determining that reinstatement is impracticable. In other words, employees who are reinstated are less likely to be suffering from any psychiatric or emotional illness which affects their capacity to work. On the other hand, inasmuch as employees unlawfully terminated may all suffer varying degrees of distress and loss of self esteem, reinstatement must go and does go a long way in assuaging injured feelings when it is coupled with compensation paid for lost remuneration to the date of reinstatement. The provision for reinstatement does limit the compensation payable to the remunerative loss because of the termination (see section 170EE(1)(b)(ii)). In contrast, s.170EE(3) only requires the Court to have regard to remuneration the employee would have received or would have been likely to receive had the termination not occurred. The sub-section is expressed in a general way so that the Court is not confined to one consideration only but is required to take into account the remuneration referred to and treat it as an element in working out the amount of compensation payable. Accordingly, there is emphasis on the pecuniary loss without limiting compensation to the remuneration lost. This means that; for instance, less tangible benefits and detriments may be compensated for, such as the employee's loss of job security (see Nicolson's case at pages 213 and 214) and, because of the differences between the remedies available under section 170EE of the Act the Court is able to address different needs. It follows from what I have said that in my view section 170EE(3) should not without further argument be construed narrowly by denying compensation for distress and loss of self esteem in an appropriate case. SECTION 170DB(4) During the hearing it appears to have been conceded by the applicant that her gross annual salary consisted of $26,000 together with the car allowance giving a total salary of $33,800 per annum. The uncontested evidence from the respondent's witnesses was that the petrol allowance referred to in the letter of offer was only payable up to $25.00 per week on receiving receipts for the same. Because of these considerations I am satisfied that the sum the respondent was liable to pay to the applicant during the notice period was $500.00 and $150.00 respectively. The shortfall of $50.00 has been conceded and an order is made accordingly. Apart from this order and the order for two months' compensation, I have also granted liberty to apply on reasonable notice to each party to allow the question of the amount of the compensation payable to be addressed should there be any doubt as to the proper incidence of taxation, if any, payable by the employer. MINUTES OF ORDERS THE COURT ORDERS BY CONSENT THAT: 1. The title of the respondent is amended to Australian Jewish Press Pty Ltd (A.C.N. 008-631-347). 2. The respondent pay to the applicant the sum of $50.00 pursuant to s.170DB(4) of the Industrial Relations Act 1988. 3. The respondent pay to the applicant the sum of $150.00 by way of commission payments. AND FURTHER ORDERS THAT within 21 days of the date of making these orders: 4. The respondent pay to the applicant compensation in the sum of $5,633.33 less any sum required to be deducted therefrom by the respondent pursuant to the Income Tax Assessment Act 1936 and actually paid to the Commissioner of Taxation. 5. There be liberty to each party to apply to the Court on reasonable notice on the amount of compensation payable pursuant to the lastmentioned order. NOTE: Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules. I certify that this and the preceding forty (40) pages are a true copy of the reasons for judgment of Judicial Registrar Millane. Associate: Dated: 13 June 1996 Solicitors for the Applicant: Macpherson & Kelley Counsel for the Applicant: Ms F. McLeod Solicitors for the Respondent: Holding Redlich Appearing for the Respondent: Mr L. Johns Date of hearing: 1, 2 & 4 April 1996 Date of judgment: 13 June 1996