Industrial Relations Commission of New South Wales CITATION: Barrell v. Geekie [2006] NSWIRComm 1121 APPLICANT Anna Barrell PARTIES: RESPONDENT Andrew Geekie, trading as Janet Manly Clinic Skin Care FILE NUMBER(S): IRC 1116 of 2006 CORAM: Connor C CATCHWORDS: termination of employment - closure of business - bankrupt employer - ex parte proceedings - difficulties in recovering entitlements - unfairness in dismissal - monetary compensation ordered LEGISLATION CITED: Industrial Relations Act 1996 Busways v. Johnson (1994) 55 IR 255 D and R Commercial Pty Limited v. Flood (2002) 113 IR 344 CASES CITED: Dima Homes Case (1989) 5 AILR Rep.4 General Pants (Trading) Company Pty Limited v. Marie - unreported Grimshaw v. Dunbar (1953) 1 All ER 350 Maldoc Pty Limited v. Bollard - unreported HEARING DATES: 26/07/2006 DATE OF JUDGMENT: 07/26/2006 EXTEMPORE JUDGMENT DATE : 07/26/2006 APPLICANT appeared unrepresented LEGAL REPRESENTATIVES: RESPONDENT no appearance DECISION: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: CONNOR C Wednesday, 26 July, 2006 Matter No IRC 1116 of 2006 Anna Barrell and Andrew Geekie Application under S.84 of the Industrial Relations Act, 1996 DECISION [2006] NSWIRComm 1121 Introduction 1 Mrs Anna Barrell was employed by Mr Andrew Geekie and his wife in a skincare clinic which has traded under a range of titles - Janet Beauty Salon, Janet Manley Aesthetic Centre, Janet Manley Looking Good, Janet Manley Clinical Skin Care and Janet Skincare and Beauty and Janet Manley Clinical Skincare. Mrs Barrell's services were terminated on Saturday, 11 February, 2006 when the business closed down. At that time she had been employed by Mr Geekie and his wife for nine years. 2 Pursuant to the provisions of Part 6, Unfair Dismissals, of Chapter 2, Employment [Ss.83 to 90] of the 1996 Industrial Relations Act, Mrs Barrell lodged an application claiming that the termination of her services was unfair and seeking monetary compensation over it. Her Part 6 application was allocated initially to Tabbaa C and set down by Registry staff for a conciliation and directions hearing on Wednesday, 22 March, 2006 which Tabbaa C found it necessary to vacate due to other commitments. She set the matter down for proceedings on Monday, 27 March, 2006. 3 There was no appearance in the hearing by Mr Geekie or his wife and Tabbaa C's assistant attempted to contact them on the telephone and by facsimile transmission without success. It is Mrs Barrell's understanding that Mrs Geekie travels to Sydney from interstate (Hobart) regularly - twice a month - to work in a beauty salon in Campbelltown. According to Mrs Barrell, she was informed that Mrs Geekie had been declared bankrupt in the middle of 2004 and that Mr Geekie was also in the process of being declared a bankrupt. (In fact, it is now clear that both Mr Geekie and his wife have been declared bankrupt, although Mrs Barrell asserts that they are continuing to trade under another name in Campbelltown.) 4 In the absence of Mr Geekie, his wife or their representative in the proceedings on Monday, 27 March, 2006, Tabbaa C abandoned further conciliation and, in accordance with Practice Direction No.17, she made standard directions - that Mrs Barrell file and serve her evidentiary material by Monday, 17 April, 2006, that Mr Geekie or his wife respond with their evidentiary material by Monday, 8 May, 2006 and that any further evidentiary material in reply from Mrs Barrell be provided by Monday, 15 May, 2006. Mrs Barrell sought and was granted and extension of time to file her evidentiary material - on Monday, 1 May, 2006 - with a commensurate extension of time provided to Mr Geekie and his wife. The file was allocated to me for hearing on Wednesday, 26 July, 2006. Again there was no appearance on behalf of Mr Geekie or his wife. Nor had they responded to the directions made in their absence. I propose to proceed ex parte to determine Mrs Barrell's Part 6 claim. Such a course had been foreshadowed by Tabbaa C in the conciliation of Mrs Barrell's Part 6 application. 5 In proceeding ex parte I must be satisfied that proper notice was provided to Mrs Barrell's former employer that her Part 6 application was set down for hearing. It is essentially a question of ensuring natural justice. A party to any litigation is prima facie entitled to have it heard in his presence. He is entitled to dispute his opponent's case, cross-examine any of his opponent's witnesses, call his own witnesses and give such other relevant evidence before the court. Common justice demands, so far as can be given effect to without injustice to the other party, that the litigant who is absent should be allowed to come to court and address issues in dispute [Grimshaw v. Dunbar (1953) 1 All ER 350 at p.355]. 6 But a party may not simply ignore a claim made against it and expect the proceedings to be aborted. I am satisfied that there was proper notice to Mr Geekie and his wife that Mrs Barrell's Part 6 application would proceed to hearing on Wednesday, 26 July, 2006. Registry staff forwarded a notice of the hearing by mail and by facsimile transmission to the business address of the beauty clinic. The Evidence 7 In these ex parte proceedings Mrs Barrell still carries the onus of establishing the unfairness in her dismissal. In its unreported decision of Thursday, 8 September, 1994 in General Pants (Trading) Company Pty Limited v. Marie [Matter No. IRC 3123 of 1993] the Full Bench of the Commission (Fisher J - President, Schmidt J and Murphy CC) commented (at p.18) that where an employer does not appear in proceedings in response to a Part 6 application, the dismissed employee: "…had still to discharge the onus placed on (the employee) by the Act..." To use the words of the Full Bench of the former State Industrial Commission (Bauer J, Varnum DP and Sheils C) in the Dima Homes Case (1989) 5 AILR Rep 4, there must be "...sufficient particulars to regulate the decision making process…". 8 The evidence in this hearing, uncontested in the absence of any response from Mr Geekie and his wife, is contained in the written statement which Mrs Barrell provided in response to the directions made by Tabbaa C. Mrs Barrell asserted in that written statement that on Wednesday, 5 October, 2005 Mrs Geekie informed her that the beauty salon was closing down, probably at Christmas time and that she should commence "...looking for alternative employment...". Attempts were made by another staff member to seek clarification of the closing date of the clinic and that employee was informed that "...the clinic would remain open no longer than Easter, 2006...". 9 Mrs Barrell recorded in her written statement that: "...On Friday, 4 November, 2005 two senior representatives from Macquarie Leasing arrived at the clinic demanding entry and search rights to the clinic to ascertain whether or not a laser (an expensive piece of equipment) was at the clinic. At that time they said that it was stolen property. I attempted to contact Mr Geekie via telephone but his telephone was switched to message bank. One of the Macquarie Leasing men went to Campbelltown police station and returned some hours later with two detectives and took possession of the laser whilst the other gentleman remained in the clinic..." Mrs Barrell, who was the senior staff member on duty at the clinic at the time, indicated in her written statement that she had been severely traumatised by this experience - although, she claimed, that Mr Geekie adopted a somewhat jovial approach to the issue. Mrs Barrell commenced two weeks annual leave from Wednesday, 16 November, 2005 and, on the advice of a medical practitioner, she also took a further week as sick leave which she was due to physical and mental exhaustion due to work related issues. 10 The actual date for the closure of the beauty salon remained unclear, although Mrs Barrell obtained the impression that her employment at the salon would terminate on Saturday, 11 February, 2006 and that was ultimately the position. At approximately 2.00pm on Saturday, 11 February, 2006 Mr Geekie called Mrs Barrell into his office. Mrs Barrell declined to attend the meeting until she had a work colleague as a witness and when that work colleague was available the meeting took place. Mrs Barrell described the meeting in her written statement in the following terms: "…Mr Geekie stated that he was in the process of being declared bankrupt and the business would not survive. His terminology and explanation was that Phase I was my employment and that of my work colleague would be terminated, leaving the 3rd year beauty therapist and the casual qualified beauty therapist/receptionist to honour any outstanding gift vouchers and any outstanding skin care treatment courses. He stated that in his view the clinic would remain open '...at the most for a month...'. Their employment would be terminated within a month and that would be Phase II. Phase III would see the receptionist in some capacity taking bookings for tattooing, receiving eftpos and cheque payments for procedures performed and retail sale of products..." Mrs Barrell gave Mr Geekie schedules which she had prepared outlining her outstanding entitlements - annual leave, pro-rata long service leave and superannuation entitlements. Mrs Barrell also sought a formal letter outlining that her services had been terminated and an employment separation certificate. 11 Mrs Barrell has received no payments for her outstanding entitlements. Nor has she received an employment separation certificate, although she received by facsimile transmission a letter which confirmed the termination of services. She has issued a formal letter of demand against Mr Geekie and his wife for her outstanding entitlements. She has received no positive response. Indeed, no response at all. As far as her outstanding superannuation entitlements are concerned, Mr Geekie has informed her that "...was not his problem..." and that she should take the matter up with the Federal Government. She has taken the matter up with her local Federal Government representative, the Australian Taxation Office, the Taxation Ombudsman and the Commonwealth Ombudsman. Any resolution of that matter is pending. As far as her entitlements to annual leave and pro-rate long service leave are concerned, she has raised her claims with the State Department of Commerce and has been informed that because of her Part 6 application it would no longer be pursuing her claims. Conclusion 12 I do not believe that any claim Mrs Barrell may chose to make over her outstanding entitlements should in any way be affected by her Part 6 application which is concerned only with a discrete matter, ie whether the termination of her services was unfair. Mrs Barrell's entitlements to annual leave, pro-rata long service leave or, for that matter, her superannuation entitlements, are rights which she has in any event. It may be open to an industrial organisation, ie a trade union to press a small claim - less than $10,000.00 - under Ss.379 and 380 in Part 6 proceedings. But as the Full Bench of the Commission (Glynn and Hungerford JJ and Connor C) indicated in its unreported decision of Wednesday, 10 February, 1999 in Maldoc Pty Limited v. Bollard [Matter No.IRC 2710 of 1997], it is not open to an individual employee in Part 6 proceedings and such claims will need to be mounted in the local courts or before an industrial magistrate, either by the individual employee or the State Department of Commerce on her behalf. She should take the matter up again with the Department and I recommend that she does so. 13 That having been said, I turn to what is clearly within my jurisdiction in these proceedings. I am satisfied that Mrs Barrell's dismissal was unfair - "harsh", "unreasonable" or "unjust", to use the language of S.84(1) [Busways v. Johnson (1994) 55 IR 255 at p.261]. Whilst there should have been little room for doubt that Mrs Barrell's employment in the beauty salon was coming to an end shortly, Mr Geekie and his wife were prepared to leave Mrs Barrell and her working colleagues with much uncertainty concerning the actual date of closure of the salon. As she indicated in her submissions in the hearing, she received no notice of the termination of her services. I believe that any employee, especially one with a lengthy period of employment as was Mrs Barrell, is entitled to considerably more courtesy than that from her employer. Moreover, whilst for the reasons I have outlined earlier in this decision I believe I should not necessarily take into account the outstanding entitlements that appear to be due to Mrs Barrell, I also regard it as unfair that she has been put to the efforts and legal costs ($550.00) - so far unfruitful - that she has to recover any of those entitlements. 14 In view of the closure of the beauty salon, the only effective remedy in this case is monetary compensation under S.89(5), which is what Mrs Barrell is seeking with her Part 6 application. Mr Geekie's status as bankrupt has been confirmed. Mrs Barrell has provided a notice of the first meeting of creditors for Mr Geekie's estate on Monday, 19 June, 2006. That, of course, would no doubt present some problems to Mrs Barrell in recovering any monetary compensation under S.89(5). And if he is presently domiciled interstate, that would no doubt add to Mrs Barrell's difficulties. But, in the circumstances, I see no reason why monetary compensation under S.89(5) may simply be added to Mrs Barrell's other entitlements, which I understand she has already raised. My decision would provide Mrs Barrell with a judgement debt to recover against the bankrupt estate. 15 The upper limit for monetary compensation is set by S.89(5) as: "…an amount of compensation not exceeding six months' remuneration of the applicant at the average rate received over the period of six months immediately before being dismissed…" The Part 6 applications in this hearing must also be considered bearing in mind the provisions of S.89(6), viz: "When assessing any compensation payable, the Commission is to take into account whether the applicant made a reasonable attempt to find alternative employment and the remuneration that would have been payable if the applicant had succeeded in obtaining alternative employment." 16 Whilst S.89(5) is concerned with loss of income, not any assessment of damages, there still remains a certain amount of speculation in determining the appropriate level of compensation. In D and R Commercial Pty Limited v. Flood (2002) 113 IR 344 the Full Bench of the Commission (Wright J - President, Walton J - Vice President and Tabbaa C) alluded to that when (at p.363) it commented that: "…the power in the Commission to make a money order, subject to the limitation on the quantum of compensation and the matters required to be taken into account by S.89(6), is nevertheless within the Commission's discretion. Whilst the Commission is required to take into consideration the matters identified in S.89(6), those matters are not necessarily to be reflected in any particular, arithmetic or definitive way in the money order for compensation made…" 17 Mrs Barrell has found only temporary, casual employment since the termination of her employment. Based on the figure of $688.49 which Mrs Barrell recorded in her Part 6 application as his average weekly rate of pay, I propose to order that Mr Geekie pay to her sum of $4,500.00, together with the legal costs of $550.00 which she incurred in proceeding with this matter. O R D E R 1. Mr Andrew Geekie shall pay the sum of $5,050.00 to Mrs Anna Barrell within 21 days. 2. This order shall take effect on and from Wednesday, 26 July, 2006. P J CONNOR Commissioner DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.