McKnight v Rentokil Pty Ltd [1997] IRCA 276

DECISION NO:276/97 C A T C H W O R D S INDUSTRIAL LAW - Termination of employment - unlawful termination - whether VALID REASON - compensation WORKPLACE RELATIONS ACT 1988, ss.170DE, 170EE McKNIGHT v RENTOKIL PTY LTD No.VI96/2525 JUDICIAL REGISTRAR : LJ FARRELL PLACE : ADELAIDE (HEARD IN MELBOURNE) DATE : 30 SEPTEMBER 1997 IN THE INDUSTRIAL RELATIONS COURT ) OF AUSTRALIA ) VICTORIA DISTRICT REGISTRY ) No.SA96/2525 B E T W E E N DIANE McKNIGHT Applicant AND RENTOKIL PTY LTD Respondent MINUTES OF ORDER BEFORE : JUDICIAL REGISTRAR LJ FARRELL PLACE : ADELAIDE DATE : 30 SEPTEMBER 1997 THE COURT ORDERS THAT: The respondent pay to the applicant the sum of $2031 within 21 days of today's date. NOTE: Settlement and entry of Orders is dealt with by Order 36 of the Industrial Relations Court Rules

IN THE INDUSTRIAL RELATIONS COURT ) OF AUSTRALIA ) VICTORIA DISTRICT REGISTRY ) No.VI96/2525 B E T W E E N DIANE MCKNIGHT Applicant AND RENTOKIL PTY LTD Respondent BEFORE : JUDICIAL REGISTRAR LJ FARRELL PLACE : ADELAIDE DATE : 30 SEPTEMBER 1997 REASONS FOR JUDGMENT This is an application for relief in respect of termination of employment. The application comes before the Court pursuant to the provisions of Section 170ED of the Workplace Relations Act. The applicant seeks reinstatement. The Respondent sells and maintains toilet services. These services consist of the installation of hygiene and deodorising equipment as well as maintaining the service. The applicant was employed as a sales person from 4 January 1996 until 1 October 1996 when her employment was summarily terminated for misconduct by Mr Ross Douglas, a branch manager of the respondent. The Applicant's duties involved visiting potential customers, demonstrating the company's services and obtaining sales. The applicant was paid a base salary of $24,380 per annum as well as commission. Reasons for the termination of the applicant's employment. The respondent's case was that the applicant's employment was terminated for three reasons. 1. The applicant had misled the respondent that she had obtained concluded sales when those sales were conditional. This had lead to a situation where the applicant received commission to which she was not entitled. The commission was later paid back to the respondent. 2. The applicant misled customers of the respondent that they were signing something which was not binding or the Applicant had misrepresented the true situation in relation to whether the head office of a customer had agreed to the services being provided. 3. The applicant had disobeyed a direct reasonable and lawful command. The applicant had been told not to go to Kmart to sell the respondent's services in the week beginning 23 September 1996 and she had done so. The events leading up to the termination of the applicant's employment. The respondent led evidence from a number of customersas well as from three of its employees regarding the applicant's conduct. Monkami Sharron Bergles, an office worker employed by Monkami gave evidence that she had dealt with the applicant. She understood that the contract that she signed was a quote. She agreed to sign the contract on the basis that it would save the applicant from having to travel out to Monkami if the contract was approved by the Committee of Management and because it would result in her employer receiving the services at the current price. The applicant told Ms Bergles that she would hold on to the contract until it was ratified by the Committee. Ms Bergles' evidence was straightforward. Although this incident was early on in the chain of events and would otherwise be of little relevance, it demonstrated the applicant's style and approach to customers. The applicant gave evidence about this incident, she suggested in her evidence that Ms Bergles was lying. I detected nothing in the demeanour of Ms Bergles to suggest that she was lying, nor did she have any motive for lying. I preferred the evidence of Ms Bergles. Mercedes Benz The contract was cancelled sometime later because of a dispute within Mercedes Benz, unrelated to the applicant's sale. The applicant had called through the sale to head office immediately. The evidence about whether the applicant was at fault in her dealings with this customer was equivocal. Organic Coatings The applicant had been assured that the person she dealt with had the authority. But later the respondent was advised that the customer wanted to hold off from installation so the contract was cancelled. Vic Roads The applicant failed to advise the respondent that the contract had fallen through. As a consequence she received commission that later had to be paid back. Jam Hotels The applicant had approached one of the hotel managers in the chain. Frank Aidone, the Manager of the chain told the applicant she could offer the respondent's services to each of the managers but this was conveyed to each hotel manager as meaning that Mr Aidone had authorised the purchase of the respondent's services and products. The transactions were complicated by Mr Aidone insisting that the hotels be visited by one person, the applicant. This led to Pasquale Persjin pretending that she had had dealings with Mr Aidone. The other side of Rentokil's operations were also involved Tim Lalor gave evidence that he believed he was signing for a reduction in the cost of the total services provided by Rentokil. Victorian Police Academy This was a very large sale shortly before the end of the month. The applicant was paid commission and then the sale fell through. Two police officers Sergeant Barnett and Gary Dower and the housekeeper Patricia Stanton were called to give evidence. Sergeant Barnett gave evidence that he believed he was being given a quote by the applicant, he later communicated this to Ms Persjin when she contacted him to find out what had happened. He also gave evidence that he told the applicant that he did not have authority. He was surprised when he received an invoice shortly afterwards. The housekeeper gave evidence that the applicant told her that she was writing a quote and that it was necessary to sign it so that the products could be ordered in case they decided to go ahead with it. Broadway and Frame Tony De Luca, who signed the contract was misled by the applicant about whether the Bulleen site of the company had signed the contract. He signed the contract to save her from having to travel. He told her she would have to check back with him.He made it clear that he did not have authority. Cummins Diesel Kevin Ryan who signed the contract on behalf of Cummins Diesel gave evidence that he told the applicant that he did not have the authority to do so. He informed the applicant of this at the time he dealt with her. He understood that he was signing the document so that chemicals could be ordered in for his company's site. His evidence was straightforward. She proceeded to submit the contract for payment of her commission even though it had not been approved. Kmart Managers of Kmart stores were called to give evidence about the applicant's dealings with Kmart. Barry Saunders, a Kmart manager at Ringwood gave evidence that the applicant had told him that the services had been approved by head office. He then rang and checked with Mr Layton his regional manager who knew nothing about the services. Peter Schaeffer, a Kmart manager at Forest Hills gave evidence that the applicant had said that the head office of Kmart had approved the service. It is apparent from the contract that he signed that this conversation with the applicant must have taken place on 24 September 1996. Terry Layton gave evidence that he had spoken with Pasquale Persjin after being contacted by some of his store managers and he had said the stores had little money to spare. Mr Douglas gave evidence that he had told the applicant not to approach the Kmart stores on 23 September 1996 during a staff meeting. Diane Lang another salesperson employed by the respondent gave evidence that Mr Douglas had directed everyone at the meeting not to visit any new Kmart stores. The applicant was unable to recall any such conversation at that meeting. All the Kmart contracts were cancelled on 25 September 1996. I was left with the impression that the evidence about the Kmart stores was incomplete however it is clear from the evidence that the applicant continued to mislead customers in ways she had been warned against doing. Capral The company complained about the applicant's selling style. Melbourne Water The evidence about the applicant's dealings with Melbourne Water revealed misunderstandings between the applicant and her colleagues. I am satisfied on the evidence before me that her behaviour towards Pascale Persjin following the Melbourne Water dealings was inappropriate and warranted some reprimand. In the weeks leading up to the termination of the applicant's employment a number of events occurred. 12 August 1996; A memo from the divisional manager, Mr Eric Hamilton was distributed to the respondent's sales people. The memo highlighted the need for sales people to conduct themselves with integrity in their dealings with the respondent's customers. It referred to specific conduct that the applicant had been engaging in that needed to change. 6 September 1996; A meeting took place between the applicant, Mr Hamilton and Mr Douglas. The purpose of the meeting was to discuss the applicant's performance, her sales performance, her manner with staff and her conduct with customers. 11 September 1996; The applicant was provided with a memo detailing the discussions of 6 September 1996 and advising her that this was her first warning about that conduct. She was advised that "you are required to achieve sales of a minimum $24,000.00 for September and conduct your selling activities to avoid the time, cost and disruptiveness caused by cancelled sales." He referred to a review on 16 September. The memo was not provided to the applicant until 13 September 1996 when a meeting took place between Mr Douglas and the applicant. 16 September 1996; The applicant provided a written response to the memo of 11 September 1996 and the meeting of 6 September 1996. The applicant's account of what occurred between her and each of the customers was at odds with the account given in their evidence. 25 September 1996; Memo from Mr Douglas to the applicant responding to her correspondence of 16 September 1996, this was not given to the applicant until the day her employment was terminated. 1 October 1996; Mr Douglas met with the applicant and put to her a series of incidents about which she had been warned in addition he put to her a number of other incidents that had occurred over time. He regarded her response as inadequate and he summarily terminated her employment. Additional incidents did come to light following the termination of the applicant's employment. They were allowed into evidence but not as part of the evidence of the reason for the termination of the applicant's employment. The applicant argued that she had been encouraged by the respondent and more particularly by her supervisor Pasquale Persjin to mislead customers and to "reach for the sky". Pasquale Persjin, who had been the applicant's supervisor gave evidence. She no longer works for the company. She gave her evidence in a straightforward manner. The applicant was highly critical of her. I have preferred the evidence of Ms Persjin where it conflicts with that of the applicant. The applicant did not accept any responsibility for anything that had gone wrong in relation to any of the incidents that occurred while she worked for the respondent. In her view all things that went wrong were the fault of the customers or other employees of the respondent. In giving her evidence her manner was often abrasive and argumentative. I formed the impression that she was prepared to overstate things done by others in order to protect herself. The applicant's evidence consisted almost entirely of blaming other for the incidents that had occurred this included criticism of almost all the customers as well as Mr Douglas, Ms Persjin and Ms Lang. Even after the discussions with her supervisors she did not adjust her behaviour or conduct. There was no evidence that the applicant had done anything to meet the employer's requirements as set out in the memo of 12 August 1996. Having considered the evidence before me it seems to me that the applicant's version of events is improbable and that her account of what occurred in relation to the customers that she dealt with is unreliable. Whilst there were inconsistencies in some of the respondent's evidence I conclude that the applicant misled the respondent's customers in material ways to obtain sales. The applicant was warned about the conduct but continued to pursue that course of conduct which led inevitably to the termination of her employment. She did not take heed of the direction she was given by Mr Douglas and Mr Hamilton. Her behaviour towards Mr Douglas after the meeting on 6 September 1996 appears to have been hostile and confronting. I am satisfied on the evidence before me that the respondent had a valid reason for the termination of the applicant's employment. I am also satisfied that the respondent met its obligations pursuant to Section 170 DC. However in my view the conduct of the applicant was not sufficiently serious to warrant the applicant's employment being terminated without notice or payment in lieu of notice. On termination of her employment the applicant received no payment in lieu of notice. The minimum prescribed notice for the applicant's length of service is 1 week. However the applicant was paid a monthly salary. In my view the applicant ought properly be given 1 month's notice or payment in lieu thereof. I will therefore order that the respondent pay to the applicant the sum of $2031. I certify that this and the preceding 7 pages are a true copy of my Reasons for Judgment. DATES OF HEARING : 26 7&27 MARCH 23, 24 APRIL & 23 JUNE 1997 FOR THE APPLICANT : MR IRELAND FOR THE RESPONDENT : MR LEVINE