WESTERN AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION PARTIES MURRAY GRANT HALLIGAN, APPLICANT v. BAMBOO HOLDINGS PTY LTD, RESPONDENT CORAM COMMISSIONER J L HARRISON DELIVERED WEDNESDAY, 8 MAY 2002 FILE NO. APPLICATION 1624 OF 2001 CITATION NO. 2002 WAIRC 05507 _________________________________________________________________________________________________________ 1026 WESTERN AUSTRALIAN INDUSTRIAL GAZETTE 82 W.A.I.G. Result Application alleging unfair dismissal upheld and order issued for compensation in lieu of reinstatement Representation Applicant Mr M Hynes (of counsel) Respondent Mr E Rea (as agent) _________________________________________________________________________________________________________ Reasons for Decision 1 This is a claim by the applicant pursuant to s.29 (1)(b)(i) of the Industrial Relations Act 1979 (as amended) (“the Act”) that he was unfairly dismissed by the respondent on 17 August 2001. 2 A preliminary issue was raised by the agent for the respondent that being whether the applicant was engaged as an employee or as an independent contractor. The respondent argued that if it was found that the applicant was an independent contractor then the respondent claims that there is no jurisdiction for the Commission to hear the application for unfair dismissal. The respondent argued that in the event that the applicant is not found to have been an employee then a dismissal could not have eventuated and therefore his claim lapses. 3 The respondent also argued that in the event that the Commission finds that the applicant was an employee, there was no unfair dismissal. 4 Mr Halligan argues that he was an employee and that the termination effected on 17 August 2001 was unfair. 5 It was agreed by both parties at the outset of the hearing that both the issue of jurisdiction of the Commission to hear this matter in relation to the employment status of Mr Halligan and the events leading to the ending of Mr Halligan working with the respondent were to be argued at the hearing. 6 Mr Halligan relies on his testimony and that of his wife Mrs Maria Halligan in order to prove his claim. The respondent called a director of Bamboo Holdings Pty Ltd, Mr Frank Deng to give evidence in support of the respondent’s position. Evidence. 7 The applicant indicated that he initiated contact with Mr Deng in order to obtain employment with Bamboo Holdings Pty Ltd in early November 2000. He approached Mr Deng by phone because he understood Mr Deng was looking to employ a manager of two businesses in Tom Price that were run by Bamboo Holdings Pty Ltd. Those two businesses were Tom Price Engineering and Pilbara Scaffolding. 8 Subsequent to their initial meeting Mr Halligan was employed as a manager by Bamboo Holdings Pty Ltd. At this initial meeting in early November 2000 it was agreed between Mr Deng and Mr Halligan that he was to be the manager of the two businesses. His remuneration was to be $35.00 per hour and on the evidence of Mr Halligan, Mr Deng expected him to work for 10 hours per day, 5 days a week. Sick leave and annual leave was not to be paid over and above the $35.00 per hour. 9 Mr Deng requested that Mr Halligan supply an ABN number and generate invoices in order to be paid for the work he undertook. Invoices were to be supplied to Bamboo Holdings Pty Ltd on a weekly basis. This later changed to fortnightly invoicing. The understanding between the parties was that there would be a trial period of two months and it was Mr Halligan’s evidence that the job would be long term if things went well between him and the respondent. 10 There was an understanding between the parties that accommodation in Tom Price was to be provided by Bamboo Holdings Pty Ltd as well as a vehicle for both work and personal use. An airfare to Tom Price was provided to Mr Halligan along with return airfares to Perth every four weeks. 11 There was an arrangement that any expenses Mr Halligan incurred as a result of undertaking his job as manager were to be reimbursed and added to Mr Halligan’s weekly invoice. These expenses included incidentals such as fuel. As well as the hourly rate that was paid to Mr Halligan, GST was included on the invoice, which was to be paid by the respondent. 12 The applicant’s role was to look for new business for the respondent, quoting for jobs, as well as managing contracts which both Pilbara Scaffolding and Tom Price Engineering undertook. Day to day administrative duties were also undertaken. Work involved both on-site supervision, as well as workshop supervisory duties. In particular there was a large contract with Hamersley Iron which Mr Halligan oversaw just prior to him being terminated by the respondent. 13 Mr Halligan testified that for most of his employment things were going well with respect to his employment and a number of initiatives which he generated occurred in relation to making the two businesses more profitable. He testified that the computer system was upgraded and the work space he was provided with was also upgraded. He also obtained and oversaw the Hamersley Iron contract which was a major undertaking for him personally and for the respondent. 14 Mr Halligan testified that he wore a uniform provided by the respondent and it had the name Tom Price Engineering on the shirt and both Pilbara Scaffolding and Tom Price Engineering on the jacket. It was an expectation of the respondent that the uniform was to be worn. A business card was also generated by the respondent for Mr Halligan, with contact details for both Pilbara Scaffolding and Tom Price Engineering. On that business card Mr Halligan was nominated as the manager of the two businesses. 15 As things went well during the initial trial period, Mr Halligan arranged for his wife and two of his three children to relocate to Tom Price in early 2001. This was done with the agreement of Mr Deng. It was Mr Halligan’s understanding that the relocation costs were to be paid by the respondent. Mr Halligan testified that he would not have relocated his wife and uprooted his two children from school unless there was the prospect of long term work. He stated that the move did cause some distress to his son who was not keen to move to Tom Price because he was leaving his friends for an extended period of time. 16 All utilities such as water and electricity accounts of the applicant were paid by the respondent. 17 With respect to his work, the applicant states that he liaised very closely with Mr Deng and his brother in law, Mr Ng on daily issues. Mr Deng also assisted with liaising with clients such as Hamersley Iron. 18 Mr Halligan had ongoing dealings with a Mr KC Ong who was a consultant accountant to the respondent and who was employed to improve the efficiency of the businesses in Tom Price. 19 With respect to business related expenses, Mr Halligan testified that he was authorised to spend only up to a limited amount of money on his own volition and any other payments had to be recommended by Mr Ong for payment by Mr Deng. 20 Mr Halligan testified that he supplied no tools as his job was administrative and the respondent provided his place of work and any day to day equipment that was necessary such as pens, paper and a computer. 21 The applicant did not work for others whilst working with the respondent. Indeed, Mr Halligan’s evidence was that he was a full time employee of the respondent. 82 W.A.I.G. WESTERN AUSTRALIAN INDUSTRIAL GAZETTE 1027 22 Weekly invoices were generated by Mr Halligan in order for him to be paid. The invoices were under the name of M & M Halligan which it was claimed, was a business run by Mr Halligan and his wife. The business, he claimed, was not registered. Mr Halligan testified that he had an ABN number, as part of operating the business name. Mr Halligan did not have any business cards in the name of M & M Halligan and did not, throughout his time of employment with the respondent, undertake work in the name of M & M Halligan. 23 Approximately two months prior to August 2001 Mr Halligan oversaw a substantial contract with Hamersley Iron and during this time it was his evidence that he was working a minimum of 50 hours per week, and from time to time was so busy that he wasn’t able to return home in the evening, and slept on site. His evidence was that he was very keen to ensure that this job went well and so he put an enormous amount of his energy into ensuring that this contract was successful. 24 At no stage, Mr Halligan maintained, were there any warnings about the quality of his work, nor was he ever made aware that his job was in jeopardy and that he was generating insufficient contracts for the respondent. 25 Towards the beginning of August 2001 there was a dispute between the applicant and respondent over two issues. One was that the respondent was now requiring Mr Halligan and a number of its other workers who previously had their electricity accounts paid by Bamboo Holdings Pty Ltd to now pay their own electricity accounts. Mr Halligan testified that he was upset about this because he believed it was contrary to the original undertaking being given by the respondent to pay the account. Further, Mr Halligan became concerned an account for his family’s relocation to Tom Price earlier in the year was still outstanding. That account, on Mr Halligan’s evidence, was sent to Tom Price Engineering for payment. 26 Things came to a head on 17 August 2001 when Mr Halligan contacted Mr Deng to discuss why it was that he now had to pay his electricity accounts and why it was that the relocation expenses for his family were still outstanding. He contacted Mr Deng who drove from Paraburdoo to have a meeting with Mr Halligan on the 17 August 2001. At the meeting there was a heated exchange between the applicant and the respondent, which finished with Mr Deng terminating the employment of Mr Halligan. Mr Halligan’s evidence was that he was told by Mr Deng that he could F_ off. Mr Halligan took that to mean that he was sacked. He accordingly packed his things and went home to his house in Tom Price. 27 Evidence was given by Mr Halligan that there was a meeting between Mr Deng, Mr Halligan and Mrs Halligan some two days later in Tom Price. Mr Deng came to the Halligan’s house in Tom Price whilst they were in the middle of packing up to return to Perth. The parties were looking at finalising the matters in dispute between them by the respondent paying an amount of money. However there was an outstanding issue in relation to a management plan which Mr Halligan claims he set up for the respondent. The plan was based on a plan from another organisation which Mr Halligan had organised for the respondent and Mr Halligan claimed that there was another copy on the computer at his former place of work. In any event Mr Deng contacted the police to collect the management plan on that day. The plan was handed over to the police and the settlement of the agreed sum never took place. 28 Mr Halligan received an employment separation certificate dated 31/08/2001 from the respondent claiming that a termination was effected because the respondent could not afford to keep Mr Halligan employed (Exhibit A2). 29 Mr Halligan testified that the effect of his dismissal had been devastating on him and his family. He claimed he has suffered a breakdown as a result of the dismissal and that he has only recently been well enough to return to work. In support of this, he tendered Exhibit A3 which is a letter from Mr Halligan’s doctor confirming that he has been unfit for work from 11 September 2001, through to March 2002. The letter confirms that Mr Halligan had recently been undertaking casual light duties which were assisting in his return to the workforce, albeit in a limited capacity. As at 3 April 2002, according to the letter, Mr Halligan was certified fit for full time work, but not necessarily to undertake work at a managerial level. 30 Mr Halligan maintains that reinstatement is not practicable as he was so physically and mentally distressed by the dismissal that he could no longer work for the respondent. 31 Mr Halligan testified that in the time since his dismissal he had worked one week for $17 per hour as a scaffolder and had recently gained on-going work on the same rate of pay. He stated that he had been out of work for a period of 30 weeks. 32 Mrs Halligan also gave evidence for the applicant. Her evidence was that she had never been employed by the business name of M & M Halligan and that no other employee had ever been employed by M & M Halligan. She conceded that the business was established for taxation purposes. Mrs Halligan confirmed that on the major contract for Hamersley Iron that was undertaken just prior to Mr Halligan finishing work with the respondent, he spent many hours on site and on occasions did not return home. She stated that in her view the dismissal was totally unexpected as there was no warning that it was coming. Mrs Halligan also confirmed Mr Halligan’s evidence that there was a meeting with Mr Deng some two days after the termination of Mr Halligan at their residence in Tom Price and that an amount of money was discussed between the parties in order to settle their dispute. 33 Mr Deng gave evidence on behalf of the respondent. He confirmed that Mr Halligan approached him for work and that there was an agreement for the respondent to supply a house, a car and that Mr Halligan was to be paid $35.00 per hour. He claims that employment was to be on the basis that if there was no work there would be no pay. Employment would continue as long as there was work available. Mr Deng described this as being the customary practise of how his company operated in the North West and how everyone involved in his business was to operate. Mr Deng indicated that the applicant was required to provide an ABN number. He accepted that GST would be paid over and above the hourly rate of $35.00 per hour and he confirmed the applicant was to be paid weekly. However this became fortnightly after Mr Ong was engaged to effect efficiencies with respect to the respondent’s operations. 34 Sick leave and annual leave was not paid to Mr Halligan. 35 Mr Deng confirmed that Mr Halligan’s employment was on the basis of an indefinite contract. 36 Mr Deng claims the respondent was losing money in mid 2001 as a result of a lack of contracts being undertaken by the respondent. However when Mr Halligan initially arrived in Tom Price it appears that the respondent was making a reasonable amount of profit. 37 Mr Deng’s evidence was that on at least one occasion the applicant threatened him verbally. 38 He claims that from time to time issues were raised with Mr Halligan about financial losses that the respondent was suffering and that he was concerned Mr Halligan was not gaining enough contracts for the businesses. 39 His evidence was that there was an agreement to pay Mr Halligan’s relocation costs but no specific amount was agreed to. Mr Deng claimed that the $6,000 or more the company was being charged in order to fund the relocation was excessive and he refused to pay the full amount. 40 His evidence was that Mr Halligan had authority to spend the respondent’s money to the extent that he chose. However his evidence was clarified under cross examination when he stated that it was Mr Deng who signed the cheques which were prepared and approved by Mr Dennis Ng. 1028 WESTERN AUSTRALIAN INDUSTRIAL GAZETTE 82 W.A.I.G. 41 Mr Deng’s evidence was that he did have an ongoing input into the day to day activities of the two entities, Pilbara Scaffolding and Tom Price Engineering and that he liaised on a regular basis with Mr Halligan with respect to various contracts. 42 Mr Deng claimed that Mr Halligan was terminated because of lack of performance, and because of the financial difficulties that the business was suffering. He also conceded that there was a heated discussion between Mr Halligan and himself on the 17 August 2001 and arising out of that meeting Mr Halligan was terminated. He also claimed that Mr Halligan had behaved disrespectfully to him and that was another reason for dismissing the applicant. 43 His evidence was that there was a meeting some two days after Mr Halligan left employment with the respondent and that there was discussion about a settlement figure. However this discussion did not come to any productive finality as a result of a dispute over the management plan that it was claimed Mr Halligan had removed from his premises. 44 His evidence was that approximately two months subsequent to Mr Halligan leaving employment with the respondent another manager was secured in order to undertake the work that Mr Halligan was previously doing. Findings. 45 Where there is conflict in the evidence, the Commission is required to make findings on the credibility of witnesses. Having carefully observed the applicant during evidence in chief and cross examination I have no doubts about the truthfulness of his story. I have not the same confidence with the evidence of Mr Deng. He prevaricated at times whilst giving his evidence, did not answer some questions directly and once changed his position when pressed under cross examination. On this basis, where the evidence given by Mr Halligan and Mr Deng conflicts, I prefer the evidence of Mr Halligan. 46 I find that Mr Halligan entered into an employment arrangement with Bamboo Holdings Pty Ltd to commence as a manager of Pilbara Scaffolding and Tom Price Engineering on 6 November 2000. I am satisfied that there was a discussion prior to commencement of that employment where it was agreed between the parties, that Mr Halligan was to be employed for 10 hours per day 5 days per week at a rate of $35.00 per hour and that amount was to be inclusive of any payment for sick leave or annual leave. 47 I find that there was agreement between the parties that Mr Halligan was to have his accommodation paid and a vehicle supplied. The vehicle was for both personal and work use and that his work related out of pocket and utility expenses whilst employed at Tom Price were to be paid by the respondent. 48 I find that the respondent agreed to pay for return airfares every 4 weeks for Mr Halligan to visit his family. 49 I find that there was to be an initial period of probation whereby both parties had the opportunity to assess each other’s suitability. I also find that after this initial period, both parties regarded Mr Halligan’s position as being long term. 50 I find that on the basis of this long term arrangement between the applicant and the respondent Mr Halligan’s wife and two children joined him in Tom Price on 4 January 2001. 51 I find that it was a requirement of Mr Halligan’s employment that he provide an ABN number and that he be required to generate invoices in order for him to be paid. 52 I accept the evidence of Mr Halligan that no issues were taken with the quality and standard of his work and that he worked hard in order to fulfil his obligations to the respondent and endeavoured to ensure that the business was profitable. This was evidenced by his commitment to the Hamersley Iron project where he stated that it was an opportunity to prove himself at a managerial level and he made a substantial personal and professional commitment in order to do that. This commitment was corroborated by the evidence of his wife, whose evidence I have no reason to doubt, given the direct and unhesitating manner in which it was given. 53 I find that there was an arrangement for the respondent to pay the applicant’s relocation expenses from Bunbury to Tom Price and it was agreed that the applicant’s family would come up to Tom Price. I find that in having the applicant’s family relocate to Tom Price that this was a major move which caused upheaval for the applicant’s family but this only occurred once it was clear to the applicant he had the prospects of long term work with the respondent at Tom Price. Mr Halligan was looking at employment in Tom Price lasting approximately 5 years. Was Mr Halligan an employee or an independent contractor? 54 Mr Halligan maintains that the totality of the employment relationship between him and the respondent was one of a contract of service and argued that the main elements of the contract of employment with the respondent support this contention. The applicant relies on the recent High Court authority applicable to a matter of this nature [Hollis v Vabu Pty Ltd (2001) HCA 44] 55 The respondent argues that the intention of the parties at the time of commencing a contractual relationship was one of a contract for service not a contract of service. Further, the respondent argued that the contractual relationship was one of an indefinite contract, subject to work continuing on the basis of contracts signed. 56 In order to determine the issue of the nature of the relationship I am required to review the character of the relationship between the applicant and respondent. There are a number of relevant indicia to determine the nature of the relationship between parties. The legal character of a relationship is not limited to the intention of the parties on engagement. There are a number of significant factors which must be taken into account. Control. 57 The right of the employer to control what the employee shall do and how the employee shall do it is a significant test in determining the employment relationship [Stevens v Brodribb Sawmilling Co Pty Ltd (1985 – 1986) 160 CLR 16 and ABLF v Brajkovich (1991) 71 WAIG 23]. 58 On the issue of control, in this case the evidence established that— 1) Mr Halligan could not spend the respondent’s money without authority from Mr KC Ong, Mr Deng’s brother in law Mr Ng, and Mr Deng. Also Mr Halligan had to report to these people on a range of day to day matters. 2) Mr Halligan negotiated contracts in conjunction with Mr Deng. 3) Mr Deng endeavoured to unilaterally alter Mr Halligan’s hours to 40 hours at one stage. 4) Mr Halligan could not and did not work for other businesses, as conceded by Mr Deng under cross examination. Clearly, Mr Halligan had an obligation to work only for the respondent whilst he was in Tom Price. 5) Mr Halligan was provided with the respondent’s uniform, which was required to be worn as part of his employment. There was not close day to day supervision of Mr Halligan, as one would not normally expect this of a person in a managerial position of this nature. 59 From the above it was clear there was a significant amount of control over the applicant in relation to how he went about his work, how he was supervised, and the extent to which the applicant was effectively bound to work for the respondent. 82 W.A.I.G. WESTERN AUSTRALIAN INDUSTRIAL GAZETTE 1029 Organization Test. 60 A second major element in determining the employment relationship is the organisation test. The question to determine here is whether or not the applicant is an integral part of the business of the respondent: Stevens v Brodribb Sawmilling Co Pty Ltd (op cit). 61 It is clear from the evidence of both Mr Halligan and Mr Deng that the applicant undertook work at the behest of the business as supervised and co-ordinated by Mr Deng, Mr Ong and Mr Dennis Ng. Mr Halligan was provided with a fully maintained vehicle by the respondent. He was given a business card (Exhibit A1), which described Mr Halligan as the Manager of both Pilbara Scaffolding and Tom Price Engineering. He had a right to hire and fire workers involved with the respondent and was initially provided with regular return air fares to visit his family after commencing work with the respondent. These elements indicate that Mr Halligan was closely involved in the business structure of the respondent, consistent with a contract of service. Supply of Labour. 62 Mr Halligan did not quote for the job he undertook for the respondent as a normal business operator would. Work was undertaken on a labour only basis, as there was little if any profit margin built into the rate of pay that Mr Halligan received after discounting sick leave and annual leave entitlements. This points to a contract of service. Income. 63 The applicant received a regular weekly and later fortnightly income that was indistinguishable from wages. Indeed he was paid in a manner consistent with the manner a wage earner might be subject, notwithstanding the variation in hours worked per week, and the method of taxation. Hours. 64 An issue was made by the respondent about Mr Halligan being able to work the hours he chose. Mr Deng at one stage sought to limit the hours worked by Mr Halligan, and Mr Halligan claims he worked more hours than he claimed because of his commitment to the respondent. At the end of the day I go back to my original finding that I accept the evidence of Mr Halligan that there was an understanding at the outset that the usual hours per week would be 50, worked over 5 days, at 10 hours per day and that from time to time Mr Halligan worked additional hours on his own volition in order to prove himself in the job. This is consistent with a contract of service. Taxation. 65 Mr Halligan had a taxation arrangement which is indicative of a contract for service. However, in this case Mr Halligan was required to adopt this arrangement in order to undertake employment with the respondent. 66 With respect to the taxation arrangement it is clear that the set up was that which was required by the respondent when the applicant commenced working for the respondent, in that; 1) the applicant was required to provide an ABN number as part of his understanding with the employer in order to commence work. 2) the applicant had to invoice the respondent on the basis of hours worked, normally the agreed 50 hours per week. GST was added to the invoice as an ABN number had been obtained. Even though this arrangement is normally one associated with a contract for service, as it was an arrangement initiated by the respondent, I do not find this factor to be decisive. Further it was a convenience for the respondent as the respondent did not have to become involved in employee taxation issues. Termination. 67 It was Mr Deng’s evidence that he terminated Mr Halligan on the 17 August 2001. Termination of an arrangement in this way is not indicative of a contract for service rather it is indicative of a contact of service. Provision of Tools / Equipment. 68 All of the equipment for Mr Halligan to undertake his work was supplied by the respondent. This is indicative of a contract of service. Separation Certificate. 69 Mr Halligan was issued with a separation certificate by the respondent. I accept Mr Deng’s evidence that this was for social security purposes. I do not find this factor decisive. Sick Leave and Annual Leave. 70 Whilst Mr Halligan was not entitled to sick or annual leave, which is indicative of a contract of service, it is also indicative of a casual employment relationship. Therefore, I do not find this factor to be decisive. 71 There are two other matters that were raised as an issue by the respondent in the proceedings. Mr Halligan gave evidence that when he first met with Mr Deng to discuss the contractual arrangement with the respondent, he referred to Mr Deng as “the client.” Even though this may point to a contract for service, I do not find this use of terminology to be significant as Mr Halligan consistently maintained under cross examination that, even though he had an ABN number and levied GST on his invoice, he regarded himself as an employee, as explained to him by his accountant. Reference was also made to the issue of Mr Halligan providing “Managerial Services”. I regard this issue as one of nomenclature which therefore is not determinative of the employment relationship. 72 Having considered the relevant authorities and after carefully reviewing the way in which Mr Halligan worked for the respondent, I conclude that the most significant elements of the employment relationship point to a contract of service. I am aware that some of the indicia point to a contract for service, however, these elements do not outweigh the indicia pointing to a contract of service. 73 I therefore conclude that given the above, even though some indicia point to a contract for service, on balance I find that Mr Halligan was an employee of the respondent who was engaged under a contract of service. I now turn to the issue of the Unfair Dismissal. 74 At a meeting on 17 August 2001 both parties conceded that Mr Deng terminated the employment relationship between Mr Halligan and the respondent. The applicant claims that the issue of non payment of the electricity account and his relocation expenses was contrary to undertakings given by the respondent. He therefore arranged to meet with Mr Deng to discuss this. Mr Halligan was frustrated by Mr Deng breaching an understanding between the parties. 75 On the other hand the respondent claims that electricity accounts now had to be paid by the respondent’s workers because losses were being experienced by the respondent. Further Mr Deng claimed that he was concerned about the excessive costs of the relocation expenses for Mr Halligan. Mr Deng also claims that there was an issue with respect to lack of work. However it does not appear from his evidence that it was raised at the meeting on the 17 August 2001. 1030 WESTERN AUSTRALIAN INDUSTRIAL GAZETTE 82 W.A.I.G. 76 Mr Deng also maintained that Mr Halligan was disrespectful to him and had previously threatened Mr Deng verbally. However, this was never put to Mr Halligan in cross examination consequently, I disregard this evidence on the basis of the rule in Browne v Dunn (1894) 6 R 67. 77 I have already stated that where the evidence of Mr Halligan and Mr Deng conflicts, I prefer the evidence of Mr Halligan. I find that effectively what occurred on 17 August 2001 was that Mr Halligan was dismissed without notice by Mr Deng with Mr Halligan being told by Mr Deng to F___ off. I accept that there was a heated discussion over the non payment of Mr Halligan’s electricity account and relocation expenses, which led to Mr Deng ending the contract of employment without notice. I find that no issue was put to Mr Halligan at the meeting with Mr Deng in regard to lack of work of the respondent, or of rudeness on the part of Mr Halligan to Mr Deng, which Mr Deng relies on to justify the ending of the contract of employment. 78 No evidence was put before the Commission by the respondent in order to justify this dismissal apart from some references to lack of work and insubordination which was not supported by corroborating evidence. Even though there was a heated argument between Mr Deng and Mr Halligan, I do not find that there was conduct on the part of Mr Halligan serious enough to warrant any dismissal. I find that there was no basis at all for the termination of Mr Halligan. Conclusion 79 In all of the circumstances, having regard to the findings I have made and the applicable legal principles, I am of the view that Mr Halligan was unfairly dismissed. 80 I am satisfied on the evidence that the working relationship between the applicant and respondent has broken down such that an order for re-instatement would be impracticable. 81 I therefore now turn to the question of compensation. I apply the principles set out in Bogunovich v Bayside Western Australia Pty Ltd (1998) 78 WAIG 3635 and Tranchita v Wavemaster International Pty Ltd (1999) 79 WAIG 1886. On the evidence, I am satisfied the applicant took reasonable steps to mitigate his loss even though he was medically unfit for work for some time. In the event, Mr Halligan obtained employment sooner than his doctor expected. 82 Having regard to all of the circumstance of the case I conclude that the applicant should be compensated for his loss to the fullest extent possible, subject to the cap in s.23A(4) of the Act. 83 I am persuaded that Mr Halligan, on the balance of probabilities, had the prospect of ongoing employment for some time with the respondent, as the two businesses that Mr Halligan was manager of, continue to operate. Mr Halligan’s position has been filled since he was terminated, thus giving support to my view of ongoing employment opportunity for Mr Halligan. 84 Mr Halligan earned $1,750 per week based on his evidence of working a 50 hour week at $35 per hour. Annually this amounts to $91,000. Mr Halligan testified that he worked one week in February for $646 per week and currently has ongoing work earning $646 per week since 25 March 2002. 85 Mr Halligan’s evidence is that he has not worked for 30 weeks in total since the dismissal and that he was too ill to consider working until February 2002. I find Mr Halligan’s losses to be the following— 1) Lost wages for 24 months (in my view a reasonable time after his dismissal in August 2001, to have worked for the respondent) 1st year – 22 weeks @ $1,104 = $24,288 2nd year – 52 weeks @ $1,104 = $57,408 TOTAL: $81,696 [The $1,104 being the difference between $1,750 and current earnings of $646 week] 2) In addition the Commission is to assess injury. In Mr Halligan’s case I find that the dismissal has had a devastating impact on Mr Halligan. His evidence was that he suffered a nervous breakdown as a result of him losing his position with the respondent. He has not been well enough to work for a considerable period of time because of this breakdown, and his family relationships have suffered. Mr Halligan also had to endure the inconvenience and expense of relocation back to Bunbury. In the circumstances, it is reasonable that a sum of $3,000 for injury be awarded. 86 The sums that I have identified as being lost total more than the equivalent of six month’s remuneration. As s.23A of the Act caps the awarding of compensation at six month’s remuneration, I therefore order that an amount equivalent to 6 month’s remuneration be paid to Mr Halligan, being $45,500. Orders that the applicant was unfairly dismissed and that he be paid compensation in the sum of $45,500 will issue. _________ 2002 WAIRC 05550