FEDERAL COURT OF AUSTRALIA

Premier Pet Pty Ltd trading as Bay Fish v Brown [2013] FCA 17

THE COURT ORDERS THAT:

The interlocutory application filed 13 December 2012 be dismissed with costs.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

1    Before me is an urgent interlocutory application filed 13 December 2012 for stay of an order of a Federal Magistrate made on 6 November 2012 in Brown v Premier Pet T/A Bay Fish [2012] FMCA 1089. In that case his Honour ordered that the applicant, Premier Pet Pty Ltd (“Premier Pet”), reinstate Mr Adam Brown to his former employment, on the basis that Premier Pet had contravened s 340(1) of the Fair Work Act 2009 (Cth) (“FWA”) by dismissing Mr Brown from his employment on 15 July 2011.

Decision of the Federal Magistrate

2    In summary, his Honour found as follows:

    Mr Brown was employed by Premier Pet as a fish keeper or fish treater, on a full-time permanent basis in Premier Pet’s Brisbane fish room. His employment commenced 14 March 2011 and was terminated 15 July 2011.

    Mr Brown alleged the termination was adverse action in contravention of s 340(1) of the FWA because he had chosen to exercise a workplace right.

    Mr Brown claimed that he had exercised two workplace rights and that the exercise of those rights was the reason or part of the reason for his termination. Those workplace rights were:

1.    his right to refuse to work unreasonable overtime; and

2.    his right to take his dispute about being required to work overtime to Fair Work Australia.

    The respondent had terminated Mr Brown’s employment, which constituted adverse action for the purposes of item 1(a) of the table in s 342(1) of the FWA.

    Mr Brown’s claim was substantiated insofar as he asserted that the reason or part of the reason for his termination was his right to refuse to work unreasonable overtime. Relevantly, his Honour noted:

[22]    Section 62(2) provides that an employee may refuse to work additional hours beyond those referred to in s.62(1)(a) or (b) if they are unreasonable. In my view, s.62(2) creates an entitlement in an employee to refuse to work additional hours. That is, Mr Brown is entitled to the benefit of s.62(2) of the Fair Work Act. By refusing to participate in the involuntary non-trading day roster, Mr Brown has purported to exercise a workplace right, namely, his entitlement to refuse to work unreasonable hours, pursuant to s.62(2).

3    After detailed consideration of relevant principles, his Honour found:

[47]    In all of those circumstances. I am not satisfied that the employer has discharged the onus on it to demonstrate that it did not terminate Mr Brown’s employment for the reasons that he asserts. The contravention is made out.

4    In relation to whether reinstatement was appropriate relief in the circumstances, his Honour continued:

[48]    In these proceedings, Mr Brown originally claimed compensation and the imposition of a pecuniary penalty but for reasons delivered by me earlier in these proceedings, he cannot pursue those claims. The only outstanding claim is one for reinstatement.

[49]    It is said that reinstatement is not appropriate because the employer has moved on and the relationship between the employer and the employee has irretrievably broken down. The employer in this instance is a company. It is not a circumstance where there is a personal respondent.

[50]    In Greater Dandenong City Council & Australian Municipal, Administrative, Clerical and Services Union (2001) FCA 349, Wilcox J said this at paragraph 39:

Finally, at paragraph 126, Madgwick J, the trial judge, turned to remedies. He held there are plainly mitigating circumstances so a nominal penalty will suffice. His Honour observed, in paragraph 127, that where reinstatement is sought for proven unlawful termination of employment, it should generally be regarded as the primary remedy and awarded except where it would be impracticable to do so, or where there are other just and compelling reasons against that course.

[51]    Here it is said that the necessary relationship between employer and employee is missing - it has been destroyed. It is further said that the circumstances of the respondent’s business are such that it is no longer practicable for reinstatement to be ordered.

[52]    In Laz v Downer Group Pty Ltd (2000) 108 IR 244, Moore J said at paragraph 36:

[36]    I accept that it is relevant to consider whether a satisfactory working relationship can be re-established. But as von Doussa J said in Ettridge v TransAdelaide (1998) 80 IR 422 at 430 (in relation to the exercise of the power conferred by s170CR):

In considering whether the discretion to order reinstatement should be exercised, a central consideration is whether a satisfactory working relationship can be re-established between the parties. As Moore J observed in Bean v Milstern Retirement Services Pty Ltd (unreported, Industrial Relations Court of Australia, 2 June 1995) in many instances personal tensions created by litigation can be expected to lessen if not dissipate entirely with the passage of time.

See also Perkins v Grace Worldwide (Australia) Pty Ltd (1997) 72 IR 186 at 191 and Sherman v Peabody Coal Ltd (1998) 88 IR 408 at 424-425.

[53]    In this case, the senior management with whom Mr Brown had his disagreements have left the company. Mr Mason is no longer there and Mr Briggs is no longer there. Mr Patrick remains the managing director of the respondent but he is based in Narrangba, whereas Mr Brown’s employment was based at the Brisbane fish room - a different location.

[54]    Mr Patrick’s affidavit makes it clear that his role as general manager was just that - a managerial role, and he had little contact with Mr Brown. According to his affidavit, most of his contact with Mr Brown was via Mr Mason and Mr Briggs.

[55]    Having regard to those matters, I am not satisfied that there has been such a break down in the relationship between employer and employee as to mean that reinstatement is not a viable option. Put another way, I am not satisfied that the tensions that have been created by this litigation will mean that reinstatement is not appropriate, mainly because Mr Mason and Mr Briggs are no longer a part of the company. And so, whomever it is that supervises Mr Brown if it was that he was reinstated, would be somebody new and perhaps unfamiliar with these proceedings. There is certainly no evidence to the contrary.

[56]    The next issue to consider then is the current situation of the business. Mr Patrick gives four paragraphs of evidence about that. He says that the respondent’s overall business operations and sales revenue have decreased and as a result, staffing levels in the Brisbane fish room have downsized considerably since Mr Brown was employed some 15 months ago. He then, in paragraph 12 of his affidavit, falsifies that evidence. He says:

As of 31 July 2011, 15 permanent staff and five casual staff were employed in the Brisbane fish room. (that is a total of 20 staff) By contrast, as at 30 September 2012, only seven permanent staff and 11 casual staff, two of whom were juniors, were employed in the Brisbane fish room (that is 18 staff, a difference of two).

[57]    I accept that there’s a difference between 15 permanent staff and seven permanent staff on the one hand, and five casual staff and 11 casual staff on the other but that may be no more than a change in the way in which the respondent has chosen to employ its workers. The issue is not explored in the evidence in any detail. One is left to speculate and I refuse to speculate.

[58]    Mr Patrick says the marked increase in the casualised nature of the working arrangements in the Brisbane fish room reflects the unpredictable nature of sales of live fish in the present business climate. The overall number of working hours performed in the Brisbane fish room has also decreased by 14 per cent. One wonders whether that then means that there is now no need for an involuntary roster arrangement. Further Mr Patrick asserts in his affidavit that there is not presently a sufficient amount of work available in the Brisbane fish room to support an additional full time permanent employee but as counsel for the respondent quite properly conceded, the fact that the position does not exist any more is not an answer to a claim for reinstatement.

[59]    Finally, in paragraph 11 of his affidavit, Mr Patrick says that since July, 2011 live fish sales revenue has decreased by 12 per cent. He does not say, however, 12 per cent of what. 12 per cent could mean anything in the context of this business, this business about which there is no evidence as to its size. It is submitted that it is a small business but there is no evidence to suggest that that is so. I note that it has a Brisbane fish room, a Melbourne fish room and has some premises at Narrangba. That tends to suggest an operation which is of some size.

[60]    In all of the circumstances, I am satisfied that reinstatement is an appropriate option in this case.

Notice of Appeal

5    The decision of his Honour is currently the subject of an appeal, listed for hearing in this Court on 12 February 2013. Detailed grounds of appeal have been filed.

Application for a stay of the Federal Magistrate’s Order

6    A number of affidavits have been filed on behalf of both parties in this proceeding. Specifically, affidavits have been sworn on behalf of Premier Pet by Mr Jared Patrick (the managing director of Premier Pet) on 12 December 2012 and Mr Damon King (the solicitor for Premier Pet) on 17 January 2013. Mr Brown has sworn two affidavits on his own behalf, the first dated 20 December 2012 and the second dated 17 January 2013.

7    Mr Patrick deposes, in summary, that:

    The respondent asked to return to his former employment with the appellant from 12 November 2012.

    Since 12 November 2012, due to a lack of available work, the appellant has not been able to return him to active duties, but has been paying the respondent the wages ordinarily payable if there was work to provide to him.

    A National Personal Insolvency Index extract confirms the respondent’s status as an undischarged bankrupt.

    The respondent deposed during the hearing in the Federal Magistrates Court on 5 November 2012 that he had not obtained any gainful employment since his dismissal on 15 July 2011 and had therefore earned no income since that date.

    Mr Patrick is concerned that any wages paid in the interim will not be recoverable from the respondent in the event that the appeal is successful, given his status as an undischarged bankrupt.

8    Mr Brown has deposed, inter alia, that:

    a stay would cause him extreme hardship; and

    he was being paid by Premier Pet, but was not at work, and had therefore lost any ability to gain additional overtime payments.

Consideration

9    It is a well-settled principle that a party which has been successful is entitled to the fruits of its judgment, and that decisions at first instance are not to be treated as merely provisional: Alexander v Cambridge Credit Corp Ltd (1985) 2 NSWLR 685 at 694–5; Cook’s Construction Pty Ltd v Stork Food Systems Australasia Pty Ltd [2008] 2 Qd R 453 at [12]; Citrus Queensland Pty Ltd v Sunstate Orchards Pty Ltd [2008] FCA 1867 at [39]. The Court has discretion to grant a stay of orders in appropriate circumstances, however it is clear that the lodgment of an appeal does not automatically warrant a stay of orders below. As was explained by the Court of Appeal of New South Wales in Alexander at 694:

The onus is upon the applicant to demonstrate a proper basis for a stay that will be fair to all parties: Trlin. The mere filing of an appeal will not, of itself, provide a reason or demonstrate an appropriate case, nor will it discharge the onus which the applicant bears: see Supreme Court Rules, Pt 51, r 10; Waller v Todorovic. The Court has a discretion whether or not to grant the stay and, if so, as to the terms that would be fair. In the exercise of its discretion, the Court will weigh considerations such as the balance of convenience and the competing rights of the parties before it: Attorney- General v Emerson (1889) 24 QBD 56.

10    In this case I am not persuaded that a stay of orders of the Federal Magistrate is warranted, for the following reasons.

11    First, the appeal from the decision of the Federal Magistrate is listed for hearing in this Court in less than four weeks from now. At that time, the Court can give proper consideration to the merits of the appeal. I note the submission of Mr Pratt for Premier Pet that the timing of the hearing of the interlocutory application did not result from late filing of the interlocutory application by Premier Pet, but rather followed the accommodation granted by the Court to Mr Brown as a (then) unrepresented litigant to seek legal representation and file material prior to the hearing of this application. However this does not alter the fact that the hearing of the appeal is imminent. While the proximity of the hearing date of an appeal can potentially also be a reason to support an application for a stay of orders the subject of that appeal, at this late stage I consider a stay would provide little meaningful benefit to Premier Pet.

12    Second, while I note the uncontested evidence before the Court that Mr Brown is a bankrupt, and the real possibility that recovery of payments made by Premier Pet to Mr Brown may not be possible should Premier Pet’s appeal be successful, nonetheless I am also mindful of the financial hardship Mr Brown deposes he would suffer should the judgment in his favour be stayed. Mr Pratt submitted that a particular concern of Premier Pet was, in summary, that Mr Brown does not maintain savings, but spends his salary within a short time after receipt. In my view, expenditure of wages by a wage-earner to meet commitments is not unusual. Notwithstanding some evidence concerning Mr Brown’s involvement in an online sword-selling business, his employment with Premier Pet appears to be his primary (if not sole) source of income. In light of the respective financial positions of the parties, on balance I consider that the interests of justice favour the preservation of the existing order in Mr Brown’s favour, pending the hearing of the appeal.

13    Third, on the material before the Court at this point the prospect of success of the appeal is not obvious to me. It is clear from submissions of Mr McMillan for Mr Brown that the grounds of appeal are contested. Detailed reasons were given by the Federal Magistrate for his decision in Mr Brown’s favour, and correspondingly detailed grounds of appeal have been filed by Premier Pet (and opposed by Mr Brown). The hearing of an application for a stay is not the appropriate forum to undertake detailed consideration of those grounds of appeal. On balance, I am not persuaded at this stage that the grounds of appeal in themselves support an order for stay of his Honour’s orders below.

14    Finally, the order of his Honour was that Mr Brown be reinstated because termination of his employment was in contravention of the FWA. Generally speaking, an order in these terms is unremarkable in light of findings of this kind, and in my view could not be described as so unusual as to influence the exercise of the Court’s discretion to order a stay pending hearing of an appeal.

Costs

15    Mr Pratt submitted that costs should be in the cause because, inter alia, the application for a stay was inextricably intertwined with the appeal. I do not accept this submission. An application for stay of orders at first instance is not an intrinsic part of the appeal process. The usual order in circumstances such as these is that costs follow the event, and I see no reason for a departure from that approach.

16    In my view the appropriate order is to dismiss the interlocutory application for stay of his Honour’s orders, with costs.

Associate:

Dated:    21 January 2013