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Yanuca Island Ltd v Vatuinaruku [2017] FJHC 92; ERCA9.2014 (8 February 2017)

IN THE EMPLOYMENT RELATIONS COURT

AT SUVA

APPELLATE JURISDICTION


CASE NUMBER: ERCA 9 of 2014


BETWEEN: YANUCA ISLAND LIMITED trading as SHANGRI- LA’s FIJIAN RESORT AND SPA

APPELLANT


AND: VANI VATUINARUKU

RESPONDENT

Appearances: Mr. J. Apted and Ms. J. Fong for the Appellant.

No Appearance of the Respondent.

Date/Place of Judgment: Wednesday 8 January 2017 at Suva.

Coram: Hon. Madam Justice Anjala Wati.

_______________________________________________________________________________________

Catchwords:

Employment Law – Summary Dismissal – Whether lawful and fair – to determine lawfulness of the dismissal one needs to make a finding on whether the employer had a lawful cause and whether it followed the correct procedure in carrying out the dismissal –to make a finding on whether the dismissal was fair, the employer’s conduct and manner in carrying out the dismissal is examined - The issue of whether the employee is making a claim for “unlawful dismissal” or “unfair dismissal” or both needs clarification an at early stage of the proceedings in the ERT – assessing remedies for unlawful and unfair dismissal- reducing remedies when the employees actions contributes towards the grievance.


Cases:

  1. Rentokil Initial Limited v. Kean [2013] FJHC 193; ERCA 6.2011.

Legislation:

  1. The Employment Relations Promulgation 2007 (“ERP”): ss. 33, 34; 211 (2) (a); and 230.

___________________________

Cause

  1. The employer appeals against the decision of the Employment Relations Tribunal (“ERT”) of 18 July 2014 wherein, upon the employee’s claim for unfair dismissal, it was held that the same was unjustified and unfair.
  2. Upon that finding, the ERT ordered as follows:
  3. The employer raised various grounds of appeal in the following form:
    1. The Tribunal erred in law and in fact in finding that the employee’s dismissal was “unjustified” –
      • (a) when the employee had not claimed in her report of her grievance or during the hearing that her dismissal was “unjustified”;
      • (b) alternatively, by applying the wrong test for “justification” and by not considering and applying the common law test submitted by the employer;
      • (c) by not finding that in view of
        • (i) the nature of the employee’s misconduct which she had admitted;
        • (ii) the fact that the employee was subject to two valid warnings; and
        • (iii) the fact that the employee was dismissed with pay in lieu of notice,

the dismissal was justified in all of the circumstances;


(d) by wrongly finding contrary to the evidence that the employee was told that her statement regarding the actions would be for filing only;

(e) by wrongly finding that the fact that the employee did not participate personally in the mitigation process made the dismissal unjustified when, among other things, no argument to that effect had been raised on behalf of the employee and there was nothing to suggest that the employee would have raised any further mitigating factor that had already not been raised on her behalf.
  1. The Tribunal erred in law and in fact by finding that the dismissal was “unfair’ –
  2. The Tribunal erred in law and fact and failed to act judicially in ordering the employee to be paid reimbursement of all the wages lost as a result of the grievance –
  3. The Tribunal erred in law and in fact and failed to act judicially in ordering the payments of compensation being 6 months wages for humiliation, loss of dignity and injury to the feelings of the worker –
  4. The Learned Tribunal erred in law and in fact by reducing the employee’s remedy by 12 months –

4. The appeal was served on the respondent personally. She had initially engaged Mr. Tofinga to represent her. At the hearing, neither did Mr. Tofinga appear nor did the respondent. The appeal was thus heard on an undefended basis.


Background

  1. Vani Vatuinaruku (“employee”) was employed as a Reception Manager in the Front Office Department of the Resort’s Rooms Division. She had an important role over reception staff who had custody of cash floats.
  2. It was an established rule that no one was to use the cash float for any other purpose except for the use and benefit of the hotel. Contrary to this established rule which the employee had known of and acknowledged in writing of her knowledge of the same, she took $10.00 from the float on 20 April 2011 for personal use and arranged for it to be returned later in the day.
  3. The employee had admitted to the act upon which she was suspended. Following mitigation by her Union, she was dismissed on 26 May 2011.
  4. At the time of the dismissal, the employee had two current and valid warnings against her. The first warning letter was issued on 21 November 2010. It was issued to the employee for reporting to work at 2.00pm instead of her rostered time at 8.00, without calling and seeking permission from her supervisor to report late.
  5. The second warning was issued on 29 March 2011 for a series of offence which included:
  6. Following the dismissal, the Union, on behalf of the grievor filed proceedings for unfair dismissal. No claim for unlawful dismissal was made.

Tribunal’s Decision

  1. Upon the trial, the ERT found that the suspension of the employee was justified but the dismissal was not as the employer did not follow proper procedures in carrying out the dismissal.
  2. On the aspect of procedural fairness, the ERT found that there were two reasons why it was not proper to carry out the dismissal in the way the employer did. The first was that the employee was asked by the employer to fill in a form to explain her conduct of taking $10.oo from the cash float. The ERT accepted the evidence of the employee that she was told that that form was for filing purpose only. The ERT found that no one told her that the form would go to Mr. Amstad, the Executive Assistant Manager and her divisional line Manager without her representative and her been given an opportunity to look at it.
  3. The second basis on which it was found that the termination was unjustified procedurally was that the employee was not present in the discussion between the employer and her union representative when the conduct was being discussed and termination considered. The failure was unfair and unreasonable. The ERT also said that the employee’s representative should also take the responsibility for breaching the employee’s fundamental rights.
  4. The ERT found that “a disciplinary hearing or discussion regarding the security of employment of a Union member under suspension or termination is not a matter for collective bargaining but is strictly of rights first implied in the Collective Agreement and the ERP”. I find this confusing and hard to comprehend but will comment on this at the time it is necessary.
  5. The ERT also found that the dismissal was unfair. There were no reasons stated on how the ERT arrived at this finding.

Submissions/Law and Analysis

  1. In a nutshell, the issues before this Court are whether it was open to the ERT to make a finding on whether the dismissal of VV was just and fair and whether she was entitled to any remedies, and if she was, what was the proper remedy that ought to have been granted after assessing the proper factors that needs consideration.
  2. The issues above could be answered collectively but Mr. Apted has dealt with each and every ground very specifically and in order to be able to address all of them with the same specificity, I will deal with each in turn.

Ground 1 (a)

No Claim for Unjustified Dismissal


  1. Mr. Apted submitted that the employee’s claim at all material times was for “unfair dismissal”. That was apparent from the grievance that she filed, the terms of reference to the ERT from the Mediation Unit, the conduct of the hearing and the submissions of the employee. However, in determining the grievance, the ERT went on to determine whether the same was “justified”.
  2. It was averred by Mr. Apted that he had drawn to the attention of the employee and her representative through his submission that the question of “unjustified dismissal” has not been addressed by the employee. Despite that, the employee and her experienced union representative did not seek to amend the claim or address the issue in the closing submissions.
  3. Mr. Apted says that the ERT went ahead and considered the issue of “unjustified dismissal” when it was not raised. This breached s. 112 of the ERP and the principles of natural justice.
  4. S. 112, argued Mr. Apted, provides that “if the worker brings an employment grievance in relation to one aspect of employment but during the determination of the grievance there is evidence of a grievance in relation to another aspect of employment, the decision may also cover that other aspect, provided that the employer is advised during the proceedings of such matter”.
  5. The above section, submitted Mr. Apted, takes account of the possibility that the grievor may be ignorant of the proper grievance either because of a mistake in terminology or because at the time the grievance is reported, the grievor is not aware of all of her rights or the evidence. The section therefore allows the ERT to deal with unreported matters but the employer must be informed of this during the proceedings. It was improper for the ERT to have considered the issue without putting the employer on notice.
  6. Mr. Apted’s argument needs very careful examination because this issue has not only affected him but has been seen to be a prevalent problem in all matters before the ERT.
  7. Before I go into the specifics of this matter, I will make a general remark. There are so many parties who are confused with the terms “unlawful” and “unfair” dismissal. They seem to be of the impression that the terms are used interchangeably or that it means the same thing.
  8. I have found in the very many appeals that I have presided upon that most of the employees just include the term “unfair dismissal” in their grievance or dispute. When they do give evidence they also cover the aspect of “unlawful dismissal” too.
  9. In summary dismissal cases, to determine whether the same is “justified”, the court examines the reasons for the dismissal and the procedure invoked in carrying it out. To determine whether the same is “fair” the court examines the manner in which the same was carried out. I will discuss the second aspect in detail later.
  10. Sometimes what the parameters of their complaint are becomes apparent from the preliminary submissions of the employees. Sometimes it is not. Since the employer has to begin the proceedings, most of them or their representatives may be confused as to whether or not evidence needs to be tendered on other aspects. These matters can be easily ironed out during the preliminary stages of the proceedings and the ERT can guide the employees on matters of procedure where they are unrepresented and explain the terms for them to decide what would be the form of the evidence.
  11. I have also seen in many proceedings that in order to protect the interest of their clients, counsel for the employers always tender evidence on all aspects.
  12. In this case, although the employee did not raise the issue of the lawfulness of the termination right until the end of the hearing, the employer had adduced evidence to cover its position. Mr. Apted also covered the aspect of “justified dismissal” in his submissions. He was aptly able to do that because of his immense experience in these areas and the understanding that the onus was on the employer to justify the dismissal.
  13. Since Mr. Apted was able to tender evidence on this issue of “justified dismissal” and address the same in the submissions, I do not find that there was any breach of natural justice or that the employer was prejudiced in any way. The appeal cannot be set aside on that ground in absence of any prejudice being shown. I still, however, wish to address the reason why the ERT considered the issue of “unjustified dismissal”.
  14. The ERT specifically found that it discovered during the hearing that the employee and her union representative were confused about the terminologies and that in the interest of justice both the aspects of termination needed consideration.
  15. If it appeared to the ERT that the employee and the union were confused, it ought to have explained to the union and required it to clarify its position. That would be the proper and formal way to deal with the dilemma.
  16. It is another matter that in this case, the employer is not prejudiced. There may be cases where the employer may be prejudiced if it relies solely on the complaint and the initial submissions to tender the evidence. In such instances, the question of the allowing the decision to stand in light of the breach of the principles of natural justice would be under serious consideration.

Ground 1 (b)

The Test for “Justification”.


  1. It was argued by Mr. Apted that in determining whether the termination was justified, the ERT relied on the test for justification provided for under the New Zealand legislation when there exists no such equivalent provision in the ERP.
  2. It was argued that the New Zealand legislation contains only the ground for unjustified dismissal covering both justification and fairness but the ERP has separate grounds for unjustified and unfair dismissal. This is clear upon perusal of s. 230 (2) of the ERP. Fiji has been using the common law tests for unjustified and unfair dismissal.
  3. Indeed, in determining whether the dismissal was justified, the ERT relied on s. 103(1) (a) & (b) of the New Zealand Employment Relations Act 2000 which says that:

For the purposes of section 103(1) (a) and (b), the question of whether a dismissal or an action was justifiable must be determined, on an objective basis, by considering whether the employer’s actions, and how the employer acted, were what a fair and reasonable employer would have done in all the circumstances at the time the dismissal or action occurred”.


  1. I agree with Mr. Apted that Fiji has always followed the common law concept of what is unjustified and unfair dismissal. Under the New Zealand legislation, what appears is that when the issue of “unjustified dismissal” is concerned, the law looks at both the aspects of the employer’s actions and how the employer acted.
  2. I repeat that when the issue of “justified dismissal”, in cases of summary dismissal is under consideration, the reasons why the employee is terminated and the procedure leading to the termination is examined. When the issue of “unfair dismissal” is considered, the law looks at how the employer acted and behaved in carrying out the dismissal. The NZ legislation appears to encompass all the factors under one head of “justified dismissal”. If we are to follow the NZ legislation, it would mean a departure from the existing laws that Fiji has followed all these years and since these principles had been followed and applied in higher appellate courts, the ERT and this Court has no power to change the law based on some other country’s legislation.
  3. Having laid down the New Zealand test, the ERT subsequently goes on to point out correctly that to find whether the dismissal was justified it had to examine the reasons for the termination and the procedure that was invoked.
  4. That is the accurate position of the principles applied in Fiji but in finding the remedies, the ERT again goes and awards remedies under the head of unfair dismissal without making any finding on whether the dismissal was fair or not, which only points to one conclusion that finally the new Zealand definition was relied on.
  5. At this stage I will only make a remark that the New Zealand law is not applicable to Fiji due to the existing principles of law that has been applied in this country. To find whether the ERT’s finding on the question of “unjustified dismissal” and “unfair dismissal” was proper in law and on the facts of the case, the other grounds need examination in detail as these issues appear under separate grounds of appeal.
  6. I will now first examine the next ground of appeal which contextually also, is necessary to be addressed first.

Ground 1 (c)

Whether the Dismissal was Justified?


  1. This ground will also encompass grounds 1 (d) and (e) because it discusses whether the termination was justified procedurally which is a consideration that is properly made under the head of “justified dismissal”.
  2. I find on my reading of the judgment that the ERT found that the employer had reasons for terminating the employee but that the procedure invoked was not correct. The judgment is however lacking in clarity. I refer to paragraphs 51 and 52 of the judgment which is to the following effect:

“51. From the evidence the employer laid out the reason for termination to be gross misconduct (non-compliance with rules and regulations, negligent and irresponsible behavior and performance and theft). From the evidence the grievor agreed to all the allegations against her; that she took the $10, replaced it and that she was on second and final warning.


52. What did the employer do? The employer took a statement from the grievor, after which it established that there was a case for gross misconduct plus she was on second and final warning warranting termination”.


  1. The above paragraphs appear to accept that misconduct was established because nothing is said after that on what is the ERT’s specific finding on this aspect.
  2. The judgment also does not find at any place that the employer did not have a cause to terminate the employee. After the above paragraphs, the employer immediately proceeds to make a finding on whether the correct procedure was used to carry out the termination.
  3. In examining whether proper procedure was followed, the ERT stated that at the time employer was proposing to make a decision that was likely to have an adverse effect on the employee’s employment, it was obliged to provide her access to information relevant to the continuation of her employment and an opportunity to comment on the information before the decision.
  4. The ERT found that a statement was taken from the employee and that she was told that it was for filing purposes. No one told her that it would go to Mr. Amstad without her representative and her having looked at it.
  5. The ERT further found that the grievor should have been part of the discussion that took place between the employer and the Union when the aspect of termination was being considered. The Union was also blamed for proceeding without the employee.
  6. Speaking on procedure, it is not disputed that this was a dismissal for cause. Summary dismissals are allowed by law, the ERP, and particularly the Collective Agreement that the employee had referred to at the trial. Clause 12. 5 of the contract provided for summary dismissal without notice. S. 33 (1) of the ERP also provides that a worker can be summarily dismissed in certain circumstances without notice. The employee in this case is alleged to have willfully disobeyed the orders of the hotel and to have breached the express terms of the contract by breaching the rules and regulations of the Hotel.
  7. When a summary dismissal is carried out, the employer needs to be satisfied of the employee’s guilt and in order to be satisfied of that it usually carries out its investigation.
  8. It is not necessary that an investigation is carried out all the time as sometimes the facts are clear but in cases where it is not and the employer is carrying out the investigation, it does not have to provide the employee with an opportunity to explain its position or a right to comment on the information. The employer, once is satisfied of the guilt may carry out the termination.
  9. If the termination is challenged in Court, the onus is on the employer to establish the cause. It is at that stage that the investigation will help in establishing the guilt of the employee.
  10. The ERP does not require that in carrying out the summary dismissal, the employee be provided with a right to comment on the investigation and a right to participate in any discussion as found by the ERT. That is not the procedure that is prescribed by law. All that is needed is that the employee be provided with written reasons for dismissal and be paid all the dues: ss. 33(2) and 34 of the ERP. There is no complaint regarding non-compliance of this procedure.
  11. Be that as it may, the employer had provided the employee with a right to participate in the discussion through the union which procedure was accepted by both the parties. The employee did not raise the issue that her absence in participating in the discussion was her grievance. The union represented the employee and advocated on her behalf despite which the dismissal took place. There is no evidence to suggest that the employee had anything more to add to the discussion which was material in deciding whether or not she should be terminated.
  12. On the evidence before the ERT, it was not open for a finding that the summary dismissal of the employee was not justified. The employer had established that it had a cause for dismissal and that it followed the procedure prescribed by law in doing so.
  13. I would also comment on the aspect of the statement that was provided by the employee. The ERT stated that the employee said that the form was for filing purpose. The filled form was exhibited in the evidence. This form very clearly explains that it would be escalated up to the management team for a decision to be made. It was not for filing away.
  14. Since the form was filled by the employee, there was no need for her to have a look at it and if she wanted she could have asked her representative to look at it before the discussion. There is no evidence that the union representative did not know the contents of the statement to be able to adequately represent the employee. This statement was an explanation from the employee and there is nothing that the representative could have said or done about this form.
  15. The ERT also found that the employee was to participate in the discussion with the employer. In this case, the employee was represented and the union ought to have sought proper instructions from her on what was to be said during the discussion. She was represented and there was no prejudice caused to her as a result. I do not find that any of these findings were necessary when considering the procedural aspect of the termination as I have already said that these procedures are not prescribed by law. Nevertheless, there was no breach of natural justice in these two instances which prejudiced the employee.

Ground 2: Was the Dismissal Unfair?


  1. It was argued by Mr. Apted that the ERT found that the dismissal was unfair and gave no reasons for its findings. It was submitted that there was no evidence from the employee that the employer acted in bad faith or in a manner that humiliated, caused loss of dignity or injury to the employee. In absence of such evidence, Mr. Apted argued that the findings cannot be sustained.
  2. I agree with Mr. Apted’s submission that in order for the ERT to find whether or not the dismissal was unfair, the ERT ought to have considered the manner in which the employer had treated the employee in carrying out the dismissal. If the manner in doing so was harsh, aggressive, humiliating, degrading, embarrassing or in a manner that otherwise causes humiliation, bad repute and injury to the feelings of the worker, the termination is deemed unfair. This does not mean that if a worker experiences these feelings from the fact of dismissal itself, the termination would be classed as unfair.
  3. There was no evidence to the effect that the dismissal was unfair. The finding is not substantiated by any evidence and reasons. It is improper for such a finding to stand in law and on the facts of the case.
  4. I have independently perused the evidence and I do not find that the employer had carried out the dismissal in way which caused the worker humiliation, loss of dignity and injury to the feelings of the worker.

Ground 3: The Award of Remedies: Is the Order Inchoate and Consequentially Improper?


  1. Mr. Apted argued that in awarding the remedies the ERT had ordered that the employee should be paid all the wages lost as a result of the grievance. This order lacks specificity. There is no definite sum that the employee is said to be entitled by virtue of the order. This kind of an order is incapable of being enforced.
  2. Mr. Apted also argued that 211 (2) (a) of the ERP sets the Tribunal’s monetary jurisdiction to $40,000. Unless and until the ERT fixes the remedy it is not sure whether it is acting within its jurisdiction. This indicates that the ERT has to make a specific finding on what sum should be payable as lost wages.
  3. Mr. Apted argued that this court has previously set out the factors that the ERT must consider in awarding the remedies and that is set out in the case of Rentokil Initial Limited v. Kean [2013] FJHC 193; ERCA 6. 2011 where this court has stated that:

“33. I must make an observation that when making an order for compensation the ERT is bound to look at so many matters like –


(a) the employer’s conduct in the mediation and the progress of the case.
(b) the delay caused by the employer.
(c) whether the employer should take responsibility for the delay in the determination.
(d) the employee’s employment status since termination.
(e) whether the employee mitigated his loss.
(f) the conduct of the employer hindering the employee from mitigating the loss and
(g) any other relevant factors”
  1. Mr. Apted said that the ERT did not justify the basis on which it arrived at the order for payment of all the wages. There was clear departure from the established principles of assessing the remedies. The order therefor ought to be set aside for want of clarity and reasons for arriving at the same.
  2. Mr. Apted is correct in saying that the remedy is an inchoate order. How much is the employer to pay the employee is uncertain. What is the date from which the payment must start and the date on which it must end? Is the loss of wages to be calculated up till the date of hearing or the date of judgment or the date of payment? If it is the date of the judgment or the date of payment, then why is the employer held responsible for the delay in the judgment? These are some of the questions that would affect the parties when the question of enforcement arises. There will inevitably be a dispute regarding the correct amount. The order will remain unenforceable.
  3. I agree that in the judgment of Rentokil (supra), I had laid down some of the factors that the ERT ought to consider when granting the remedies. The approach laid down in that judgment seems to be ignored and not taken heed of. Whilst the case of Rentokil does not set out the factors exhaustively, it outlines some important principles of law such as that the employee must mitigate his loss and that the employer cannot be held responsible for loss that could have been properly mitigated by the employee. The remedy therefore is not justified at all.
  4. Moreover, there is no certainty that the award is within the jurisdiction of this court. If the employer is to make payments for lost wages until the date of payment then the possibility is that the ERT has exceeded its monetary jurisdiction by awarding this remedy making it bad in law to be sustainable. The employee was dismissed in 2011. It is now almost 6 years since her termination. The possibility is more likely that s. 211 (2) (a) of the ERP which sets out the monetary limits for all claims in the ERT has been breached.
  5. Having said that, I go back to my earlier finding that the employee was not unjustifiably and unfairly dismissed. Consequently she is not entitled to any remedies.

Ground 4: Remedy for Unfair Dismissal: Is it Proper?


  1. Mr. Apted submitted under this ground that there was no evidence of unfair dismissal and any remedy under this head is not justified. He further argued that the award should not be given in the form of wages but should have a sum fixed. If compensation is to be fixed in reference to wages than the effect of the award can be very discriminatory. Those who earn more will be paid more for going through the same feelings.
  2. I have already made a finding that there was no evidence to make a finding that the employer’s actions in carrying out the dismissal was such that it constituted unfair treatment and as such no compensation can be awarded for causing the employee any humiliation, loss of dignity and injury to the feelings of the worker.
  3. I also agree with Mr. Apted that compensation for unfair dismissal causing humiliation, loss of dignity and injury to the feelings of a worker is not fixed in reference to wages. It must have a sum fixed by court and it has nothing to do with how much a worker earns.
  4. Having said that, at the end of the day, if 6 months wages is to be calculated in lump sum, it may reflect a proper amount of compensation but it has the tendency to discriminate against workers who are not in an average earning income bracket but have the same respect and dignity at work and in the society.

Ground 5: Reducing the Remedies by 12 months


  1. It was argued by Mr. Apted that due to the employee’s actions, dismissal was carried out and that she is not entitled to any remedies awarded to her. Even if the dismissal was unfair or unjustified, the ERT erred by reducing the remedy for only 12 months.
  2. In light of the findings I need not consider whether or not the remedy should be reduced. However the law provides for the same to be reduced if the employee’s actions gave rise to the grievance: s. 230 (2) (a) and (b) of the ERP.
  3. The ERT had made a finding that there was misconduct which entitled the summary dismissal to be carried out. It also found that the procedure in doing so was wrong. Although the finding that the dismissal was not justified procedurally is not supported by the facts of the case, the ERT’s reasons for reducing the remedy would have been correct if the findings were not flawed.
  4. If the employee’s dismissal was indeed unjustified procedurally, the remedy could be reduced because it would be her conduct basically that gave rise to the grievance. In such a case, the ERT can exercise its discretion under the provisions of the law to reduce the remedies.

Final Orders

  1. In the final analysis, I make the following orders:

2017_9200.png

Anjala Wati

Judge

08.02.2017

____________________


To:

  1. Munro Leys for the Appellant.
  2. Respondent.
  3. File: Suva ERCA 9 of 2014.


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