BP (SS) Co Ltd and WR Carpenter Groups Salaried Staff Association v Carpenters Fiji Ltd [2007] FJAT 9; Award 09 of 2007 (12 February 2007)

THE REPUBLIC OF THE FIJI ISLANDS

NO 9 OF 2007

AWARD OF
THE ARBITRATION TRIBUNAL

IN THE DISPUTE BETWEEN

BP (SS) CO LTD & WR CARPENTER GROUPS SALARIED STAFF ASSOCIATION

AND

CARPENTERS FIJI LIMITED

Staff Association: Mr T Tabu
Carpenters: Mr J Waqaivolavola

DECISION

This is a dispute between BP (SS) Co Ltd and W R Carpenter Groups Salaried Staff Association (the Union) and Carpenters Fiji Limited (the Employer) concerning the forced resignation of Mr Jay Dutt (the Grievor).

A trade dispute was reported by the Union on 18 July 2005. The report was accepted on 15 August 2005 by the Chief Executive Officer who referred the Dispute to a Disputes Committee. As the Committee did not convene within the prescribed time, the Minister authorized the Chief Executive Officer to refer the Dispute to an Arbitration Tribunal for settlement pursuant to section 5A (5) (a) of the Trade Disputes Act Cap 97.

The Dispute was referred to the Permanent Arbitrator on 3 November 2005 with the following terms of reference:

"..................... for settlement over the forced resignation of Mr Jay Dutt on 12 May 2005 by the Company. The union submitted that the company’s action was unjust, unfair, harsh and wrong and therefore the Grievor should be re-instated without any loss of salary or benefits from the date of termination."

The Dispute was listed for a preliminary hearing on 25 November 2005. On that day the parties requested six weeks to file their preliminary submissions and the Dispute was listed for mention on 27 January 2006.

The Union filed its preliminary submissions on 6 January 2006.

On 27 January 2006 the Employer was directed to file its submissions within seven days and the Dispute was listed for further mention on 24 February 2006. On that day the Employer was granted a further 14 days to file its preliminary submissions and the Dispute was again listed for mention on 24 March 2006.

The Employer filed its preliminary submissions on 23 March 2006.

The Dispute was subsequently listed for special mention on 31 March 2006 and was then fixed for hearing 13 and 14 June 2006.

The hearing of the Dispute took place in Suva on 13 and 14 June 2006. During the course of the hearing, the Union called two witnesses and the Employer called seven witnesses to give evidence.

At the conclusion of the evidence, the parties sought and were granted leave to file written final submissions. The Employer filed its final submissions on 26 October 2006. The Union filed its answering submissions on 17 November 2006 and the Employer filed a reply submission on 24 January 2007.

The Grievor commenced employment with the Employer on 17 January 1994. In May 2005 he was employed as an Assistant Manager at Morris Hedstrom (MH) Station Store and acting as Supervisor in menswear.

On 10 May 2005 the Grievor purchased two T Shirts and a jacket at $5.00 each for a total of $15.00 at the MH Station Store. This was not in dispute.

It would appear that the T-Shirts were marked at $29.99 and the Jacket at $39.99. The Grievor stated that he overheard a conversation between Ms B Naidu, also an assistant Manager at MH Station Store and the Store Manager Mr A Kumar to the effect that staff could purchase a selection of damaged items for $5.00 each. The Grievor stated that the Store Manager also told him personally about the reduction. It would appear that Mr Kumar himself also purchased two of the items at $5.00 each. It would appear that the Store Manager was disciplined in a similar manner to the Grievor.

However in her evidence Ms Naidu denied having the conversation and stated that she had no authority to reduce the marked prices. It would appear that the items had already been reduced by $10.00 from $39.99 and $49.99. She stated that Mr S Mudaliar, the assistant General Manager was the only person who could authorize lower prices.

The matter was reported to the Chief Security Officer who interviewed the Grievor on 11 May 2005. In the interview notes the Grievor confirmed that the T-Shirts had been marked down to $29.99 and the Jacket down to $39.99. He also confirmed being told by the Store Manager on 10 May 2005 that the items were reduced to $5.00 each.

The Chief Security Officer interviewed other staff involved in the incident. He prepared a report and recommended that both the Grievor and the Store Manager should be dismissed for gross misconduct.

On 12 May the Grievor and the Store Manager were both interviewed by the General manager. Although the evidence is somewhat unclear as to what exactly transpired on that day, it is clear to the Tribunal that the Grievor was given a choice to either resign or the matter would be reported to the Police.

Much later on the same day, the Grievor hand wrote a letter of resignation. The first part of that letter stated:

"I Jay Dutt of MH Station would like to tender my resignation effective from 12th of June as per requirement for salaried staff to give one month’s notice.

As per Management’s decision I am resigning - - - "

The General Manager stated in his evidence that he asked the Grievor to have the letter typed and re-submit it. The Grievor stated in his evidence that the General Manager took objection to the reference to the "Management’s decision".

The Grievor redrafted the letter, omitting the reference to the "Management’s decision", arranged for it to be typed and submitted it on the same day. As far as is relevant, it stated:

"I Jay Dutt of MH Station would like to tender my resignation effective from the 12th of June 2005 as per requirement for salaried staff to give one month’s notice. - - - "

Within a few days the Grievor received a letter dated 12 May 2005 from the Employer which stated:

"Your resignation letter is hereto accepted effective immediately.

Management would like to thank you for your contribution during your term of employment on Morris Hedstrom.

However you shall forfeit one month’s pay in lieu of notice.

We wish you all the best in your future endeavours"

Having considered the evidence the Tribunal has concluded that the Grievor was given the option of either resigning or the matter would be referred to the Police. The Tribunal finds that the Grievor was effectively instructed to resign. The alternative that the matter be reported to the Police put the Grievor in a position where he was really forced to resign. The Tribunal is satisfied on balance that the Grievor did not voluntarily resign.

The Tribunal has also concluded that as a consequence of the decision that the Grievor forfeit one month’s pay in lieu of notice, the Employer had effectively summarily dismissed the Grievor.

The Employer’s common law right to summarily dismiss the Grievor is limited to the circumstances set out in section 28 of the Employment Act Cap 92. As far as is relevant, section 28 states:

"An employer shall not dismiss an employee summarily except in the following circumstances:-

a) Where an employee is guilty of misconduct inconsistent with the fulfillment of the express or implied conditions of his contract of service;

b) for wiful disobedience to lawful orders given by the employer;

c) - - -

d) - - -

e) - - - "

It should be noted that even when the alleged misconduct comes within one of the circumstances set out in section 28, it is necessary for the misconduct to be of a sufficiently serious nature such as would have entitled an employer to regard the contract as having been discharged by breach.

The Tribunal accepts the evidence given by the Store Manager Mr Kumar that he had made the decision on 10 May 2005 to reduce the items to $5.00 and that he had told the Grievor of this reduction on the day. This evidence was consistent with the evidence given by the Grievor and was not contradicted by any of the Employer’s witness.

As a result the Tribunal is not satisfied that the Employer had acted reasonably when it compelled the Grievor to resign and thereby had effectively summarily dismissed him.

However the Tribunal is also satisfied that the Grievor was sufficiently familiar with his Employer’s systems in relation to the fixing and reducing of marked prices on stock that he knew or should have known that what was happening on that day was either unusual or irregular. He should have made some further inquiries. The reduction to $5.00 from either $29.99 or $39.99 was almost too good to be real. He was a willing participant in an activity which he knew or ought to have known was not consistent with the practice usually applied by the Employer. The Tribunal has no hesitation in concluding that the authorization for the price reduction had not been given by the appropriate officers of the Employer.

The Tribunal has concluded that the Grievor’s conduct amounted to a breach of trust and confidence which the Employer was reasonably entitled to expect from the Grievor. As a result the Tribunal has concluded that the Employer acting in food faith would have been entitled to terminate the Grievor’s contract of service by notice or payment in lieu of notice. Under those circumstances it appears that one month’s notice was required to be given.

The Tribunal also notes that the Grievor’s work record indicated that there were two previous matters which could reasonably have been taken into account in reaching that conclusion.

There is another matter concerning the procedure adopted by the Employer.

Although there was no evidence before the Tribunal of the existence of any agreement between the parties at the time, it was nevertheless inappropriate for the Employer to have conducted the meeting on 12 May 2005 without informing the Grievor that he could have a union representative present for the meeting.

The General Manager knew or ought to have known that the Grievor, as a union member, should have been informed of what is now generally a mandatory requirement when conducting an interview which is likely to result in serious disciplinary consequences. Both the right to fair labour practices under the Constitution and the practice in modern industrial relations now mean that an employee in the Grievor’s position should not be prejudiced or disadvantaged in a situation where the Employer is confident and experienced and where the Grievor is vulnerable and possibly intimidated.

As a result the Tribunal has concluded that the Grievor was not afforded procedural fairness. Although re-instatement is not appropriate the Employer will be required to pay two months wages to the Grievor.

Finally, there was some evidence that the Grievor was still owed a sum of money to which he was entitled as at the date of his dismissal. The effect of section 29 of the Employment Act is that the Grievor is entitled to be paid what is owed to him as at the date of his dismissal, in this case, 12 May 2005.

AWARD

The Grievor did not voluntarily resign.

The Grievor’s employment was effectively terminated by summary dismissal. Summary dismissal was unreasonable in the circumstances of this case.

The Grievor’s conduct in purchasing items at a considerably reduced and unauthorized price amounted to a breach of trust and confidence.

Under those circumstances the Employer in good faith could have terminated the Grievor’s employment by giving one month’s notice or payment in lieu of notice.

The Grievor was not afforded procedural fairness. Re-instatement is not appropriate.

The Grievor is to be paid one month’s wages in lieu of notice and two months wages in respect of the Employer’s failure to afford him procedural fairness. The Grievor is to be paid any monies owing to him as at the date of his dismissal.

DATED at Suva this 12 day of February 2007

Mr. W. D. Calanchini
ARBITRATION TRIBUNAL