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Viability Of A Business Can Determine Amount Of Dismissal Compensation

Viability of a business can determine amount of dismissal compensation

The viability of a business can determine the amount of unfair dismissal compensation ordered by the Fair Work Commission.

In a recent case, the Commission reduced the amount of compensation paid to a chef by $10,000 after it found he had been unfairly dismissed.

The Commission agreed to the discount because it determined the full amount would put the financial viability of his employer’s business at risk.

Viability of a business can determine amount of compensation

Baldhir Singh worked as a chef at the Amritsari Dhaba restaurant in Sydney on a salary of $56,000.

The restaurant made him work seven days a week preparing and cooking food.

As a result, he regularly worked more than 60 hours a week.

As the only chef at the restaurant, Singh had not taken a day off or any sick leave in almost two years.

Additionally, his boss did not allow him to take any breaks.

When the restaurant owner handed the chef a new contract stipulating a 38-hour week, with a “reasonable amount of overtime”, he complained.

Singh sent an email to his boss requesting a new set of conditions.

For example, a six-day working week with regular breaks and no excess hours.

He also told the boss he would be taking a few days off – which he did.

‘Holding business to ransom’

In response, the business owner sacked Singh via email, accusing him of exhibiting “unprofessional demand and behaviour”.

He also accused the chef of “holding the business to ransom” due to taking the days off.

“I consider this action of yours to as a way to sabotage the reputation and working of the restaurant and consider it as your resignation and I would like to let you know that your contract is TERMINATED effective today.”

Unfair dismissal

Commission senior deputy president Jonathan Hamberger found the restaurant unfairly dismissed Singh.

The owner accused the chef of serious misconduct, for example, drinking at work and providing free food to friends and family.

However Mr Hamberger didn’t buy it.

“I am not satisfied that the respondent genuinely believed that this conduct was sufficiently serious to justify immediate dismissal.

“Rather, I think that all this alleged misconduct has been put together retrospectively to try to justify a dismissal that actually occurred for other reasons.”

Mr Hamberger also found the restaurant owner unpaid Singh.

“I also estimate the applicant was being underpaid by several hundred dollars a week for the hours he was putting in.”

Viability of business at risk

Mr Hamberger ordered the restaurant to pay Singh $28,000 compensation for the unfair dismissal.

However, the business appealed the ruling arguing it was in dire financial straits.

As a result, the Commission reduced the amount of compensation by $10,000.


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