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Prasad v Land Transport Authority [2012] FJET 45; ERT 40.2009 (26 March 2012)

IN THE EMPLOYMENT RELATIONS TRIBUNAL
AT SUVA
ERT Grievance No. 40 of 2009


BETWEEN:


PREM SUSHIL PRASAD
GRIEVOR


AND:


LAND TRANSPORT AUTHORITY
EMPLOYER


Mr. N. Tofinga for Grievor
Ms. R. J. May for the Employer


RULING ON PRELIMINARY ISSUE


1.0 Preliminary Application Before the Employment Relations Tribunal

1.1 The grievance matter was set down for Hearing of the substantive matter on 23rd February 2012 before me.

1.2 On this day, the Counsel for the Employer, Ms May attempted to explain to the ERT that the employer was experiencing great difficulty as the witnesses they had anticipated would be brought before the Tribunal to give evidence were no longer available: the Acting Chairman of Land Transport Authority (or "LTA") at the material time (Mr Anand Kumar) is no longer the Permanent Secretary for Works, Infrastructure and Public Utilities including the former CEO, Mr. Etuate Koroi who is also no longer employed by LTA. Both these individuals were critical component through their direct involvement in the grievor's termination from LTA and without their presence, the employer was unable to proceed properly with the evidentiary hearing.

1.3 Ms May further alluded the ERT that if the Tribunal heard and determined the preliminary oral application first, this will potentially iron out substantive grievance raised by the grievor in terms of his allegation of unlawful and unfair dismissal by the employer. Ms May explained to the ERT that if the employer was found to be in breach of the preliminary issues raised hereunder, then the employer will accept the ERT's decision and thereafter proceed to argue on remedies only.

1.4 The ERT being mindful of the preliminary application made by the employer, stood the matter down to allow parties to discuss how they wished to proceed with the matter. Upon commencement of the proceedings after 10 minutes, by consent, both counsels raised in this ERT's view the following preliminary issues on the question of law that needs to be assessed:-

1.5 Given that the determination of this case has a potential to impact other grievance matter(s) pending before this ERT, I decided it was important to analyze the contract of service in such a way so as to allow all the LTA related grievances to take some guidance and queue from this judgment. The parties had in fact wanted a determination of the preliminary matter at the earliest possible and therefore, it was agreed by both parties that the ERT will proceed to determine and rule on this preliminary matter which shall be presented by way of legal written submissions from both sides. Directions were given to parties to provide their legal written submissions in the following manner:-

1.6 As I have said, there are other similar matters pending before this ERT hinging on the determination of this preliminary matter; subsequently a determination as indicated will be provided to the parties, irrespective of whether or not the grievor himself has shown any real urgency to deal with this matter expeditiously by not providing any submissions at all.

2.0 Facts & Relevant Provisions in the Contract of Service


2.1 Brief facts of the grievance indicate that the grievor began his employment on 14th October 2008 and was terminated from his position of Manager, Human Resources from LTA on 15th April 2009 by the former Acting Authority Chairman, Mr Anand Kumar.


2.2 The employer's reason for termination was on the basis that they were purely exercising their contractual right under the Contract of Service pursuant to Clause 2.0 (a six-month probationary period clause) to terminate the grievor's employment with LTA.


2.3 I am relying on the Employer's Preliminary Submission filed on 9th September 2009 for the relevant document (marked as "LTA 02") that shall guide me to assess the termination within the ambit of the Contract of Service applicable here. Suffice to note same document being the "Employment Contract" also appears in grievor's Preliminary Submission marked as Annexure I.


2.4 The contract of service dated 14th October 2008 under Clause 2.0 states that:


2.0 DURATION OF CONTRACT


"This Contract of Employment shall commence on the 14th day of October 2008 with 6 months probation and shall be for a period of 3 years or unless sooner terminated in the Employees' own volition or terminated in accordance with the provisions of this Agreement" (my emphasis).


2.5 The probationary period completed or ended on 13th April, 2009; however since there were public holidays prior and after this period (Easter holidays), naturally the employer furnished the Letter of Termination to the grievor after the public holiday ended on 15th April 2009 with a subject matter: "Non-Confirmation to Position – Post Probation Period".


2.6 The 'Letter of Termination' (as per Grievor's Annexure III in his Preliminary Submission) reads and I quote:-


"In exercise of contractual right as per your Contract of Service, LTA advises non-confirmation of yourself to the position of Manager Human Resources, post probation period as stipulated in your contract".


2.7 The provision relating to termination is enshrined in the contract of service under Clause 12.0 which states:


12.0 DISCIPLINARY/GRIEVANCE/TERMINATION PROCEDURES

The Disciplinary and Grievance procedure is in the Partnership Agreement (Clause 11 and 12) as in Schedule 1.


Termination

This Contract may be terminated in accordance with the provisions of the Partnership Agreement as follows"


  1. By either party giving three (3) months notice in writing, or payment of basic salary and allowance in lieu of notice.
  2. On medical grounds on the recommendation of a properly constituted Medical Board

Provided the parties may mutually agree to a period of notice of less than three (3) months for special circumstance only (underlying is my emphasis).


2.8 The employer's annexure marked as "LTA 04" in their Preliminary Submission alludes to a copy of the said Partnership Agreement (unsigned and undated) mentioned above in Clause 12.0, which is also the same document in the grievor's Preliminary Submissions marked as Annexure II.


2.9 I am relying on this to assess whether there were further terms and conditions agreed between the parties in terms of an established termination procedure, particularly in view of circumstances where probationary period would be applicable. After careful perusal I only found one provision that affected termination of LTA employees and that was contained in Clause 4.2 which states, where applicable and relevant that:


4.2 Termination Payment


  1. Where an employee's service is termination for whatever reason all salaries/wages accrued to such an employee including annual leave up to date of termination and balance of the nominated notice, if any, shall be paid within 24 hours of such termination".
  2. In the event of termination, all amounts owing by the employee including costs of unreturned protective clothing, tools...will be deducted from the employee's salary/wages.

3.0 Literal & Natural Interpretation of the Contract


3.1 Let me begin by saying that ERP does not define a termination for 'a cause' or 'without a cause'. The only provision I find in the ERP that makes a specific mention is under Section 34 where it states:


"If a worker is summarily dismissed for lawful cause, the worker must be paid on dismissal the wages due up to the time of the worker's dismissal".


3.2 Section 114 of the ERP can also be read in line of this provision where it states:-


If a worker is dismissed, the employer must, when dismissing the worker provide to the worker with a written statement setting out the reasons for the dismissal" (my emphasis).


3.3 Generally speaking, when an employee is 'terminated for a cause' they are terminated or dismissed from their job for a specific reason. Reasons an employee could be terminated for cause include, but are not limited to, are: stealing, lying, falsifying records, embezzlement, insubordination, deliberating violating company policy or rules, and other serious misconduct related to specific employment requirements. Some of these reasons are listed in section 33 (1) (a) - (e) of the ERP that entitles an employer to exercise summary dismissal where an employee can be terminated for a cause without a notice.


3.4 In this grievance matter, the employment contract of the grievor is evidently not a contract of indefinite period but one that is subject to a fixed period (as per s28 (2) of the ERP) which also contains an obvious and unambiguous provision where a six-month probationary period shall apply.


3.5 Needless to say neither the written Contract of Service nor the Partnership Agreement had any mention therein as to how the probationary period shall be gauged, monitored or evaluated in terms of its significance for granting an employee's contract on a permanent basis; what would the required procedures that both parties must adhere to; and what would be the grounds entitling the employer to terminate an employee if that employee fails to meet the expectation of the employment satisfactorily. Both documents were silent on these crucial matters.


3.6 Indeed, it was clear within the ordinary and simple meaning of the contract of service that there were no particular pre-conditions (or "cause") to be satisfied prior to entitling the employer to end the contract of employment within the six months probationary period (or at the expiration of 6months). It is then clear that neither party intended any such conditions to be imposed which were neither explicitly nor impliedly mentioned in either document.


3.7 In fact, the wording of the contract makes it clear that the contract can be terminated sooner upon the "employee's own volition" or "terminated in accordance with the provisions of this Agreement." For example, if the employee wishes to terminate the contract sooner as per his/her own volition (for whatever reason or without a cause) say before the six-month probationary period came to an end, I do not believe that any reasonable employer will be able to hold that employee back on the basis that there is an implied intention in the contract vis-a-viz the employee's obligation to satisfy any expectation of the employer that may be at the risk of being breached. This is assuming that the employer is aggrieved that the employee is terminating the contract of service well before it was made permanent where the employer feels that the organization or company has been wronged through an early exist of the employee when the expectation was that the duration of the contract, being three years would be duly performed or carried out by the employee.


3.8 Furthermore, the employer cannot hold the employee liable if they assert that they had incurred a loss, for instance, for having invested in the interview selection process, training and professional development of the employee within that period to bring the employee to a desired standard of performance expected by the employer. Here, the employee would, after gaining the required skills in this employment, no doubt use the acquired and learnt skills to benefit his/her future or next employment.


3.9 Simply put, such arguments will not keep the employee bonded to the employer for the entire duration of the contract as the employer cannot prevent or restrict the employee from terminating the contract of service within the probationary period. So, despite the employer may have put in a lot of effort and resources in training or up-skilling the employee in that six month probationary period, it does not mean that the employee cannot walk out of the arrangement at his/her freewill as long as he/she complies with the ensuing notice period under Clause 12.0 as outlined above.


3.10 Similarly, within the natural and literal meaning of the contract, I see no reason that the employer must satisfy any pre-conditions prior to terminating an employee within the probationary period, which is also not clearly laid out in the contract of service if that was the intention of the parties.


3.11 Assessing the suitability of an employee for a permanent position is not an unknown phenomenon in the employment arena and there is nothing in the ERP that prevents or restricts an employer from providing a probationary period in an employee's contract of service. In fact the ERP is silent on how a probationary period or related matters should be lawfully and fairly assessed. The ERP, however, does not outlaw probationary period in any regard on the basis it is unfair and prejudicial response or condition of the employer, considering that a contract should either be for a fixed or indefinite period, and consequently probationary period has no role to play. I also did not find any provision in the ERP that does not allow for termination on the grounds of probationary period without notice, something I will explore in depth later.


3.12 Therefore, to test the issue objectively given that ERP 2007 gives no direction whatsoever, the question to ask here is 'did the employee know that his employment might end at the conclusion of the probationary period' and 'did he reasonably consider this a real risk'?


3.13 The answer to that question lies in assessing whether the employee ought to have had reasonable expectation that his contract within the probationary period could be effectively and lawfully ended.


3.14 It is my view that he was put on adequate notice with a six-month probationary period explicitly stated in his contract of service and accordingly, it should be deemed that he had reasonable knowledge that the probability of his position being made permanent came with a waiting period of six months and that there was no guarantee that his contract would be made permanent unless the employer failed to invoke a clear decision regarding Clause 2.0. For example, upon expiration of six months, say if the employer forgets or overlooks that the six month probationary period has lapsed or surpassed its time limit where the employer has also not advised the employee (in writing or otherwise) that he or she is now a permanent employee, but later tries to rely on this to terminate the employee on that basis, I do not see the employer succeeding in their claim as per their right to terminate under Clause 2.0. In my opinion it would be deemed waived and the employer would be estopped from relying on their contractual right under this provision.


3.15 I have noted that the grievor did not present me with any legal written submissions for reasons best known to his representative and himself, and accordingly I have considered the submissions presented by the Employer where they have alluded this ERT to the case of Central Manufacturing Company Limited v Yashni Kant (Unreported Fiji Supreme Court Case Number CBV 0010 of 2002) to be applied on the basis that this ERT should accept that the Contract of Service is to be read through its literal meaning.


3.16 Indeed, the first point of reference for termination on the premise of good faith relationship is always the contract of service between the parties. This goes to the definition of an employment; employer; and worker in the ERP which all make reference to "contract of service" being a basis for an employment. A contract of service is defined as:


"...a written or oral contract, whether expressed or implied, to employ or to serve as a worker for fixed or indefinite period..."


3.17 If the parties did not clearly demarcate the purpose and intention of the probationary period and hence did not clearly state or define when and how the employer could invoke a right to terminate the contract of service on that ground, then it leaves very little, indeed no room for this ERT to substitute its own views and interpret the contract beyond and above the intention therein. In fact, there was a supplementary partnership agreement that also did not clearly define the parameters or criterion that allowed termination within probationary period. This can only mean one thing. The probationary period was recognized by both parties and discretion was to be exercised by the employer to assess on their own within the first six months, as to the suitability and adaptability of the employee to his position. The essential criterion for assessment, notice period or the grounds (reasons) for termination was not laid down. To this ERT, this leaves no room to re-construct the contract outside its literal meaning, which in essence means that the employer could lawfully terminate the employment under Clause 2.0, without a reason or cause.


3.18 I thus conclude that the contract of service under Clause 2.0 for purposes of termination within or upon expiration of the probationary period was "without a cause" within its literal meaning.


3.19 Where procedures are concerned (that is, basing strictly the contract within its literal meaning), I have to apply the case of Carpenters Fiji Limited v Isoa Latianara ERC No. 7 of 2011], where the Employment Relations Court in Fiji made the following observation, and where I also am bound to follow the same path outlined therein: Wati J noted and I quote for quote:-


"It is my duty to comment more on the procedure to terminate "for a cause" and "without a cause". In any given situation, the employer is not obligated under the termination clause to give any opportunity of hearing, as found by the Tribunal. When the termination is without cause, what is there to hear the employee on?"


3.20 Justice Wati is clear that where there is no cause for termination (here within the terms of the probationary period), and which is the case under this written contract, then the employer can proceed to terminate without necessarily according the procedure for hearing.


3.21 In terms of compliance with s114 of the ERP, I understand it does not refer to the 'cause' or 'reasons' in the context that the employer has to provide reasons after evaluating the probationary period and thus penning out their findings in a detailed manner to inform the grievor how they lawfully and/or reasonably concluded their decision to terminate the employee. If there is no cause as established under Clause 2.0, what would an employer be required to explain or write to the employee? If there is cause or reasons, it would make sense to write out the lawful cause or reasons within the ambit of say, s33(1) (a) – (e) for summary dismissal.


3.22 Therefore, the 'reasons' under s114 simply mean in this particular context that the employee at the time he was dismissed from his position had to be given adequate information which he would then be is able to comprehend and understand within the confines of his written contract of service. The contract of service alludes that there is a probationary period, which then puts the employee on reasonable notice that there was a pre-condition before he could successfully consider a permanent position to be confirmed. Strictly speaking, under Clause 2.0, the employer was not required to furnish detailed reasons how the probationary period was assessed as the evaluation criterion was not expressly set down in the contract of service.


3.23 The employer was only required to provide that pursuant to Clause 2.0 of the contract of service, the grievor's services were terminated as really there were no actual grounds, reasons or cause to provide under this Clause. This, in my opinion is sufficient to declare the employer correct in procedure which should suffice for purpose of s114 of the ERP.


4.0 Applying Principles of Natural Justice (for fair termination)


4.1 Although I have accepted that the literal and natural meaning of the contract did allow the employer to terminate grievor's employment lawfully "without a cause", there is still one other important aspect to consider that this ERT cannot avoid on the premise of natural justice and fairness.


4.2 This aspect goes to whether the employer was still obligated to inform the grevior that they were considering termination under Clause 2.0. The contract is no doubt silent on the notification as well as the "assessing criterion" that would apply to fairly terminate the contract. By "assessing criterion", I simply mean certain justifiable grounds such as poor performance, misconduct, incapacity to perform designated duties, etc which are all possible scenarios that could be used to assess the probationary period fairly and impartially.


4.3 As reiterated above, nothing of such nature was expressly contained in the contract of service. However, the ERT cannot simply ignore its obligation and not look into whether the allegation of unfair termination seeped its way into the contract in the way it was drafted and intended, by failing to lay out the grounds that could make a lawful termination also be treated as a fair termination in substance and procedure.


4.4 Simply put, to permit employers and employees to enter into probationary periods, I do not believe that the law relating to unjustifiable dismissal is affected where the employer dismisses an employee at the end of the probationary period in reliance on it.


4.5 This is because I am utterly concerned that the employer may not have understood and hence was confused how Clause 2.0 should have been applied. In their Written Legal Submissions the employer has stated that they implied into Clause 2.0 of the contract of service that 'performance' was a criterion in their mind that they had relied on to assess the suitability of the grievor (at Clause 4.3.1 at page 3 of the Employer's Submissions).


4.6 This is evidently contrary to termination "without a cause" that this contract of service is essentially alluding to, in terms of its natural and literal meaning under Clause 2.0.


4.7 If, the employer believed and indeed relied or made 'performance' as a basis to assess the grievor's termination, then the apparent contradiction allows this ERT to explore whether only the literal and narrow meaning contained in the contract should be considered (as the employer has submitted also) where a finding of lawful termination can also be deemed fair termination because the contract does not explicitly state that there should be reasons or cause for termination within the probationary period or whether the ERT should look beyond the contract wordings that would not be the conventional practice for commercial arrangements but in any given employment arrangement, because it is founded on the principles of good faith, lawful termination does not automatically declare the same as a fair termination.


4.8 For fair termination to persist, natural justice and good faith principles demand that the employer has to provide all necessary avenues to the employee to mitigate his/her grievance, have the right to be heard before any type of termination is effected (that is, before casting the guilt) and thereafter be given an unequivocal decision (as reasons) in writing whether or not the employee can carry on in that special employment relationship.


4.9 To understand this better, let me look towards other jurisdiction for guidance as clearly ERP provides no direction on this issue. Under the New Zealand employment law and agreements there is requirement that before reliance is made on the probationary period as a way of justifying dismissal, as held in NZ (with exceptions) Food Processing etc IOW v Unilever [1990] 1 NZLR 35 there must be:


  1. Notice of specific allegation and its likely consequences;
  2. A real opportunity for explanation; and
  1. An unbiased consideration of such explanation.

4.10 Fiji's employment law was modeled on the New Zealand laws when the ERP 2007 was drafted and legislated although I must say, any mention of probationary period and how it shall apply being totally absent in the ERP is perhaps done with a reason that I cannot explain. Even so, if it is considered under the definition of "dismissal" in the interpretation section of the ERP there is no doubt in my mind that "any termination of employment" is broad enough to encompass probationary period that is used as basis for termination. The above Unilever case thus makes sense when it comes to ensuring that natural justice and fairness is not denied to an employee regardless of the nature of termination.


4.11 This case makes even more sense when read more in line with another important judgment in the case of Slater v Smith [1994] NZEmpC 92; [1994] 1 ERNZ 869 at 827 where it was held that:-


"What did the parties intend by their agreement to a trial period? They meant that Mr. Smith and his work would be assessed during and at the conclusion of that period.


They intended that if it was regarded as unsatisfactory at the end of the time or it was otherwise open to be terminated for cause during the period, this would be the employer's decision and might occur at that time. But it cannot be implied into the employment contract that such a decision might be made by the employer by exercise of a completely unfettered discretion or arbitrarily in abrogation of even the most basic entitlements of fairness, objectivity, and reasonableness. The parties had an employment contract. Decided cases are all clearly to the effect that implied terms of fair process, now well established, apply as much to the trial or probationary periods of such contracts as they do after their expiry.


The detail or stringency of such implied requirements may differ in cases of trial periods but I reject the notion that an employer may, without more, summarily and unilaterally terminate the contract either during the trial period, as here, or at its end" (my emphasis).


4.12 The above case is clearly one that did not overlook an employee's right to be dealt with fairness, objectivity and reasonableness (principles of natural justice) so that employer did not unilaterally or arbitrarily decide to terminate a contract even within the probationary period. This would then require establishing some form of cause (but justifiable ones) before any kind of termination could be implemented. And here, clearly the criterion that employer said they used was "performance" of the grievor.


4.13 If the employer has implied "performance" as a basis to assess the grievor's entitlement to a permanent position after his probationary period ended, then they have opened themselves up to first explaining to the grievor how they had approached this and on what criterion, and second, bearing the onus to prove that it was the relatively poor or unsatisfactory performance of the employee that had led to his termination within the probationary period.


4.14 Clearly in my mind, that is the path the employer had chosen to go when the employment was terminated on the basis of performance, obviously here that has to be "unsatisfactory performance" which then leaves no iota of doubt that there was cause for termination that was implied and admitted by the employer in their submission in terms of their "performance" criterion.


4.15 In that regard, the grievor is entitled to know and respond to the employer's assessment criterion and decision-making process that lead to his termination. In a normal scenario he would have been also entitled to a grievance procedure if his termination was considered or carried out before expiration of the probationary period. Needless to say, if his performance was consistently and fairly monitored or gauged within his probationary period, then he would also be naturally given "a notice" as to the issue of his "performance" (that is his areas of weakness, shortcomings and suggestions for improvement) before his entire probationary period ended. He can then expect to be fairly terminated if he fails to meet the suggested improvements within that six-month trial period.


4.16 Here, the termination of the grievor has to be deemed a summary dismissal (that is with immediate effect) when the grevior was terminated right at the end of his probationary period.


4.17 This does not leave much contention for the process of hearing or according the actual notice period of three months as he was entitled under Clause 12.0 in the event it is measured against any type of termination during the contract tenure.


4.18 Further, assuming that the employer was satisfied that the grevior's performance was below their expected standard or failed to satisfactorily meet the terms and conditions of his written contract (but I am not convinced that component is duly proved yet), then hearing process in such instance has no effect or purpose. Why would the employer hear an employee if they are satisfied that he/she has not met the organizational expectation or conditions in the contract to move from the six-month probationary period to a more permanent position? And here, there is no dispute that the probationary period had effectively expired.


4.19 In that regard, the employer will retain a prerogative to terminate immediately where procedures for hearing and explanations if accorded loses its purpose if it falls within the category of summary dismissal as per Isoa's case at paragraph 26, at page 8, where Wati J has stated that:


"...If all these procedures of hearing and explanation are accorded to the employee, then the purpose of summary dismissal is lost".


4.20 But I have to say ERP only allows for summary dismissal under s33(1) (a)-(e) of the ERP for five grounds only and undeniably, there is no grounds for dismissal for "poor or unsatisfactory performance" unless ground s33(1)(c) is invoked.
Section 33 (1) (c) stipulates:


"No employer may dismiss a worker without notice except in the following circumstances –


(a) ....
(b) ....
(c) for lack of skill or qualification which the worker expressly or by implication warrants to possess
(d) ...
(e) ....

4.21 This was not the case here, as I have reiterated the aspect of poor or unsatisfactory performance has not been proved to even show that the grevior did not possess or lacked any skill that may have contributed to his poor or unsatisfactory performance.


4.22 Accordingly, for a lawful and fair summary dismissal to be proven in this grievance, there is insurmountable task for the employer to prove that it fell within one of the five stated grounds under s 33 of the ERP which they cannot substitute without escaping s 33(2) of the ERP. Obviously, they would be required to prove that they provided 'reasons in writing'.


4.23 In my fair assessment, this is not something that is easily done in any capacity as neither the employer invoked s33 of the ERP nor the letter of termination states they had any valid or lawful reasons for terminating the grievor on grounds of unsatisfactory performance that warranted instant termination without notice under s33(1).


4.24 Clearly, if the employer had not elected to make performance a ground or reason for termination as they did here, they could have proceeded to lawfully summary dismiss the grievor within the literal meaning of the contract under Clause 2.0. It is clear that they failed to invoke the latter properly and they are now estopped from relying on the literal and natural meaning of Clause 2.0.


4.25 Yet, whether it would entirely absolve the employer where the issue of natural justice and fairness is concerned, Isoa's case is clear, where there is no cause, procedure for hearing is not required, which in essence is pivotal component to fairly assessing the fairness of a dismissal. Further this case is clear where Wati J said and I quote:


"...it is not the aspect of right to be heard that leads to unfair dismissal. It is the manner of treating the employee in carrying out the dismissal that must be considered. The employer's actions must be assessed to ascertain whether the employee was treated with fairness, respect and dignity in carrying out the dismissal" (emphasis added).


4.26 I am also mindful of the principle followed in the case of Dunning (A.J.) & Sons (Shoplifters) Ltd v Jacomb (1973) IRLR 206 is which more apt here, where the Court said:-


"...the approach developed that a procedural defect would only make the dismissal unfair if the decision might have been different at the end of the day. The trend is to see procedural matters as issues of substance to be weighted in the scales of the overall merits of the case".


4.27 Simply put, the employer's right of summary dismissal arises not from a 'divine' managerial 'right to fire' but from the terms of the contract, express, incorporated and implied. I must say that the employer cannot substitute their action within the literal meaning of the contract when they chose to terminate for a cause (performance) through an implied term in the contract. In that regard, the employer has failed to fairly terminate the grievor when they denied him reasons for their decisions although this was mitigated somewhat when at the end of the probationary period, they tried to comply with Clause 12.0 – see below.


5.0 Compliance with Notice Period


5.1 This was one other issue raised by the employer that they invoked Clause 2.0 in compliance with Clause 12.0 and had given payment in lieu of notice to the grievor, hence his termination was lawful and fair.


5.2 Lawful termination, as I have attempted to explain above is not a lone factor to make a dismissal fair or justifiable. Here, for instance, it was also not clear whether the employer had discussed or given any prior notice or indication via writing or verbal communication to the grevior that his contract may be terminated within the first six-month period, assuming that the employer was consistently evaluating the grievor's performance during these crucial six months. After all, it is established that the employer was assessing the "performance" of the grievor.


5.3 From the letter of termination it is clear that the grievor's termination was to take immediate effect. It would then make sense not to give three months notice when in essence the probationary period (of entire six months) had ended when the letter of termination was given to the grievor.


5.4 The employer had waited till the expiration of the probationary period of six months and on the day it came to an end, public holiday prevented any termination on that day which then proceeded on 15th April, 2009 instead of 13th April 2009. In my opinion, the purported termination of 15th April was not outside the time limit and the employer was entitled to terminate lawfully the contract of service by giving payment of three month's salary and allowance in lieu of notice, when the employer chose to terminate the contract with immediate effect.


5.5 This is fairly in line with Justice Wati's decision in Isoa Latianara case, where she noted that "there could not be a hybrid or combination of termination methods".


5.6 Therefore, if strictly Clause 2.0 was applied within its literal meaning, employer could have proceeded to terminate immediately by making payment in lieu of notice at the end of the probationary period.


5.7 This would be in accordance with the case of Central Manufacturing Company Limited v Yashni Kant (Unreported Fiji Supreme Court Case Number CBV 0010 of 2002) which applies in the context of "payment in lieu of notice" where the court stated that:-


"...In the absence of just cause, an employer remains free to dismiss an employee at any time provided that reasonable notice of termination is given. In providing the employee with reasonable notice, the employer has two options; either to require the Employee to continue working for the duration of that period or to give employee pay in lieu of notice..."


5.8 Alternatively, in this instance once the employer had reasonably established that the grievor's on-going unsatisfactory performance persisted until the end of his probationary period (considering the employer had implied "a cause" into Clause 2.0) which the employer would have made known to the grevior, allowed him to understand his shortcomings and counseled him to improve, and also allowed him to mitigate his defence for a permanent position, then they could have terminated the grievor in the same manner as above, as in both instance the probationary period would have ended.


5.9 Where fairness is concerned, although the employer might appear that they were confused as to Clause 2.0 by implying "performance" as a cause to terminate, they still paid the grievor three month's salary and allowance in lieu of notice in compliance with Clause 12.0. This, in my opinion only strengthened the employer's position that they did not have intention to inflict any undue stress, humiliation or even depriving the grievor a short-term means of livelihood that visibly any immediate termination has the potential to adversely impact. The only area of contention that is still to be proved is how the performance was assessed and whether a fair and just basis was used before the termination was invoked. As for payment in lieu of notice, it is in line with Clause 12.0 which the employer lawfully and fairly discharged from their end.


6.0 Decision


  1. The termination within a literal and natural meaning under Clause 2.0 of the contract would have been lawfully "without a cause" if the employer did not use any reason to justify the basis of grievor's termination.
  2. Simply put, there cannot be two mutually exclusive concepts running parallel to each other – either there was "no cause" (or no reasons) for termination or there was "a cause". In this grievance, performance was admitted to be a basis of employer's decision to terminate, so the contract is deemed "with cause". Therefore, the employer cannot go back and say that they have taken a literal meaning of the written contract of service and hence, it is "without cause".
  3. The employer in actual fact, has failed to correctly interpret Clause 2.0 of the Contract of Service where they have made a basis of the termination, using a "performance" criterion that negates its natural and literal meaning. For this reason, they are now entitled to explain to the grievior how they approached the evaluation of the grevior's performance to justify his termination. This shall be adequate to allow the grievior to seek compensation if the employer cannot prove "performance" as a justifiable basis for termination. I must say that I am not content from the employer's submission that the aspect of unsatisfactory performance was proven on the balance of probabilities as the standard required before the ERT.
  4. If the employer accepts my decision as they had alluded during their oral application, then rightly the grievor is entitled to remedy in terms of unfair termination when he was not given explanation how and why his termination was decided on the basis of presumably, poor or unsatisfactory performance. This is the only aspect that this ERT has found was breached by the employer.
  5. The employer has in my opinion, complied with Clause 12.0 in terms of payment in lieu of notice which proves that they had attempted to somewhat discharge the contract of service lawfully and fairly.
  6. Parties can either proceed to substantive hearing on the issue of employer's justification for termination on the basis of "performance" keeping in mind that they will still require the two witnesses mentioned above to reliably prove this contentious issue, which really was the basis for granting their application for this preliminary matter or the employer could proceed to argue remedies as they had indicated.

DATED at Suva this 26th day of March 2012.


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LEGAL TRIBUNAL


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