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Business news, business advice and information for Australian SMEs | SmartCompany

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    A Tasmanian real estate agency has fronted up to the Hobart Magistrates Court over allegations it falsely advertised properties as being on the ‘waterfront’, including one home that was separated from the water by a highway and two other pieces of land.

    The ABC reports Tasmanian Private Realty yesterday pleaded not guilty to three counts of false or misleading representations about the location of land.

    The legal action was launched after Consumer Affairs Tasmania received a number of complaints about three properties in the Huon Valley in southern Tasmania, which were allegedly advertised as being “waterfront” or “riverside”.

    The court heard one property in the township of Franklin was advertised as “riverside” when it was actually set back behind Huon Highway and two other properties.

    Another two properties in the town of Dover were allegedly falsely advertised as “waterfront” homes, including one house where any access to the water would have only been through crown land and a fish factory.

    Tasmanian Private Realty’s defence lawyer Roger Baker argued the properties met the general public's understanding of the term waterfront.

    "They don't abut the water directly but you see they are in the waterfront district," Baker told the court, according to the ABC.

    "It's a descriptor of a general location rather than a specific point in space."

    But Andrew Parlour, principal at Russell Kennedy Lawyers, told SmartCompany there is a significant difference between claiming a property is “waterfront” or “riverside” and claiming it is found in a “waterfront district”.

    “Most normal, reasonable people are likely to think ‘waterfront’ is on the water, where ‘waterfront district’ can be within an area close to water,” says Parlour.

    Parlour says consumer law makes it very clear a business cannot make false or misleading representations about the sale or grant of an interest in land, including price, location and characteristics.

    “The question is if it is likely to mislead or deceive,” he says.

    “I would have thought in this instance it is just untrue to say it’s a waterfront property. If it’s set back behind a couple of blocks, it is clearly not riverside and any reasonable person would see that,” he adds.

    Parlour says Tasmanian Private Realty could face penalties of up to $220,000 for an individual director and $1.1 million for a body corporate, which could potentially include a real estate agency. The company could also face injunctions and damages.

    “I would think they would be hit with penalties and an injunction to stop them from making similar representations in the future,” he says.

    The court will hear closing submissions next Tuesday.

    SmartCompany contacted Tasmanian Private Realty but the company declined to comment. 

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    Coles has been hit with $2.5 million in penalties for falsely claiming its bread was “baked today” and made in-store.

    The fine, which was handed down by the Federal Court this morning, comes after the supermarket giant was banned from advertising its bread as freshly baked or baked on the day it is sold for three years.

    Imposing the penalty, chief justice James Allsop said Coles’ actions had the “significant potential to mislead or deceive” consumers and competitors.

     “The contravening conduct in this case is substantial and serious,” he said.

    “The evidence before the court showed that Coles had engaged in the campaign with the clear purpose of improving its market share vis-à-vis its competitors, being bakeries such as Bakers Delight … It set out to do so by engaging in the conduct that, in fact, breached the Australian Consumer Law.”

    ACCC chairman Rod Sims said in a statement the penalty sends “a strong message” to companies who deliberately choose to mislead consumers.

    “As the Chief Justice pointed out, it is important that sellers in the market recognise that consumers are entitled to reliable, truthful and accurate information,” Sims said.

    “The ACCC took this action because it was concerned that Coles’ ‘Baked Today, Sold Today’ and ‘Freshly Baked In-Store’ claims about its par baked bread were likely to mislead consumers. The conduct also placed independently-owned and franchised bakeries that entirely bake bread from scratch each day at a competitive disadvantage.”

    Business confidence rises but still weak

    The Reserve Bank of Australia’s decision to cut the cash rate in February may have bolstered business confidence in March, but the improved outlook still remains in fragile territory, according to the latest Roy Morgan poll.

    Roy Morgan Research’s Business Confidence results for March showed an improvement of 6.3% (6.7 points) to 112.4 points on February’s outlook. But confidence remains below both pre-federal election levels and the average for the last four years.

    While economic attitudes showed an improvement across the board, the March result stemmed mainly from an increase in the proportion of businesses that believe the next 12 months would be a good time to invest in growing their business.

    “The proportion of those who believe it will be a good time to increase investment is at its highest level for 2015 so far,” said Norman Morris, industry communications director at Roy Morgan Research.

    “The drop in the official cash rate by the RBA in February may have positively impacted on businesses’ plans to borrow, but this could easily be negated by strong economic head winds,” he added in a statement.

    Morris said the economic factors still dampening business confidence include the drop in iron ore price, difficulties getting budget measures through the Senate, uncertainty around tax reform and the May budget and other international factors.

    Shares up on open

    Aussie shares are trading slightly higher heading into lunchtime, off the back of positive gains from US markets.

    Chief market analyst at CMC Markets, Ric Spooner, said in a statement there was nothing overnight in market news likely to change the outlook for Australian investors this morning.

    “This suggests that while the market may open on a firm note, the most likely scenario for today’s trading is another day of consolidation,” he said.

    “In the last two days, the ASX 200 index has traded inside last Tuesday’s range and seems likely to remain there today. A potential assault on the 6000 high will be left to next week.”

    The S&P/ASX 200 benchmark was up 18.3 points to 5950.5 points at 12.04pm AEST. On Thursday, the Dow Jones closed 56.22 points higher, up 0.31% to 17,958.73 points.


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    A restaurant in regional Victoria has been slapped with a fine of more than $17,000 for its “disgraceful” treatment of a foreign chef.

    Saporitalia, an Italian restaurant in Lorne, has been fined $17,850 by the Federal Circuit Court for underpaying an Israeli-born chef more than $4000 while he was employed there in 2012.

    The underpayments occurred in less than a three-month period and also saw the business’ part-owner Yoav Oren stung with a $4590 penalty.

    The court also ordered the business owner to pay the Fair Work Ombudsman’s legal costs, which are north of $7000.

    The matter was brought to the attention of the Federal Circuit Court after the restaurant failed to comply with the employer watchdog’s orders to back-pay the chef.

    Judge Norah Hartnett slammed the restaurant owner while handing down her judgment, saying he had shown no remorse and had “blatant disregard” for workers’ rights under Australian law.

    “During the course of the penalty hearing, the second respondent continued to make unfounded allegations against the applicant and Mr Ittah [the chef], including raising matters as to Mr Ittah’s inability to be employed at the present time, and made further criticism of the court and its processes,” she said.

    “The second respondent exhibits a blatant disregard of the Australian workplace laws, and contempt for them.”

    Sarah Lock, principal consultant at Workplace Law Specialists Brisbane, told SmartCompany it is unfortunate the business owner did not comply with Australian law, or subsequently Fair Work.

    “The lesson is these protocols and regulations are put in place to protect employer and employee in regards to these types of underpayment matters,” Lock says.

    “Sometimes employers do it not really understanding our workplace laws, but we can’t use that as an excuse. So it’s important to ensure that their organisation or company perhaps goes through an audit process to ensure that they are compliant with the Fair Work Act and its regulations.”

    Lock says compliance notices are a positive step forward for SMEs dealing with the employee watchdog and it is unfortunate this particular business owner did not take advantage of Fair Work’s goodwill and save himself a lot of time and money by not going to court.

    “Small to medium companies don’t have the money to fight these things, so this is why these other alternatives are being offered by the ombudsman,” she says. 

    Acting Fair Work Ombudsman Michael Campbell said in a statement the ombudsman prefers to settle matters outside of the courts, however, this is not always possible.

    “It is important for employers to understand that when a compliance notice is first issued, the Fair Work Ombudsman is simply seeking to recover wages that should have been paid in the first instance – we are not seeking to be punitive,” he said.

    “Enforcing compliance notices is fundamental if we are to maintain the integrity of Australia’s workplace laws.”

    Campbell also pointed out that overseas workers are particularly vulnerable when businesses do the wrong thing and need to have their workplace rights respected.

    “Foreign workers can be vulnerable if they aren’t aware of their workplace rights or are reluctant to seek assistance, so we place a high priority on ensuring they receive their full lawful entitlements.”

    SmartCompany contacted Saporitalia but did not receive a response prior to publication. 

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    Coles was ordered to cough up a $2.5 million penalty in the Federal Court on Friday afternoon, ending a two-year battle with the consumer watchdog over the false and misleading claims it made about its “freshly baked” bread.

    The Australian Competition and Consumer Commission commenced proceedings against the supermarket giant in June 2013, alleging Coles had engaged in false, misleading and deceptive conduct by promoting its bread as "Baked Today, Sold Today" and "Freshly Baked In-Store", when the bread was actually partially baked and frozen in Ireland then transported to Coles stores and "finished" in store.

    Coles had declared last year it would “vigorously defend” the accusation, but the supermarket was found guilty in September last year.

    The ACCC had previously called on the court to fine Coles double the amount handed down on Friday, but ACCC chairman Rod Sims said in a statement the fine as it stood would act as a strong deterrent.

    “This penalty sends a strong message to companies that they should not use broad phrases in promotions that are deliberately chosen to sell products to consumers but which are likely to mislead consumers,” said Sims last week.

    But the penalty has prompted criticism from independent bakers and grocers who see the fine as a slap on the wrist for the grocery giant.

    Tony Smith, executive officer of the Baking Association of Australia, told SmartCompany he thought the fine was “laughable”.

    “That sort of money is a drop in the ocean for them,” Smith says.

    “If it was that important to take the issue as far as they did, there should have been more of a stand taken.”

    Jos de Bruin, chief executive of Master Grocers, says he applauds the ACCC for taking action against Coles but agrees a $2.5 million penalty was “nothing” to Coles.

    “Clearly this behaviour is unconscionable,” says de Bruin.

    “They have behaved in a way that deliberately set out to take away business from their competitors. They misled the public to believe they had a unique product, and being a big guy, they think they can get away with it,” he says.

    “The fine clearly demonstrates that when you are a large organisation, you can be quite belligerent when dealing with the laws of the land,” de Bruin adds.

    However, competition lawyer and Hall & Wilcox partner Sally Scott told SmartCompany although the fine is relatively small for a company the size of Coles, the law restricts penalties for misleading conduct to $1.1 million per offence.

    “This is unlike penalties for competition law offences, such as price fixing, where penalties can be linked to the size of a company and the size of the benefit obtained by the unlawful conduct,” says Scott, using the Visy price-fixing scandal as an example.

    Scott says misleading conduct penalties cannot be linked in the same way and are strictly limited to $1.1 million for each offence.

    “When determining the size of a penalty for misleading conduct, the court takes into account the size of the company, the impact of a penalty on the company and others, and whether the conduct was intentional,” says Scott.

    “These factors determine whether a penalty for each offence is $1.1 million or less.”

    Meanwhile, Coles was also restrained by the Federal Court from making similar comments on its products and promotional material for three years and ordered to place a corrective notice on its website and in its in-store bakeries.

    Scott says such non-financial penalties can be just as harmful for a company.

    “This can put a company at a disadvantage compared with its competitors,” says Scott.

    “Similarly, the publicity can be very damaging. The public has been made very aware that Coles' bread is not 'fresh'. This can have a greater impact on a company than a penalty.”

    A Coles spokesperson said in a statement to SmartCompany the company’s conduct was not deliberate.

    “In talking to customers about our bread range we did not deliberately set out to mislead anybody, but we accept that we could have done a better job in explaining how these products are made,” said the spokesperson.

    “Last year we changed our packaging and in-store signage to improve our message to customers.”

    “We are proud of the quality of our bread, whether baked from scratch in-store or ‘par baked’ by our Australian suppliers and finished in our ovens,” the spokesperson added.

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    A Melbourne-based graphic design and search engine optimisation business has been forced to close and its director has been banned from managing a corporation for six years, following action by Consumer Affairs Victoria.

    Victoria’s consumer watchdog initiated legal action against 1House Group, trading as Online Centric, after it received complaints the company was accepting payment for goods and services that were either provided late or not provided at all.

    Online Centric provided website design, graphic design and SEO services.

    But the Melbourne Magistrates’ Court has now restrained the company from requesting or accepting deposits or any other payments for those services until March 1, 2019. Nicole Papadopoulos, the director of Online Centric, has been disqualified from managing a corporation until March 1, 2021.

    The court found both Papadopoulos and Online Centric breached the Australian Consumer Law. Consumer Affairs Victoria said in a statement the company and Papadopoulos have also been ordered to close the company’s website and pay costs of $1700.

    Rohan Harris, principal at law firm Russell Kennedy, told SmartCompany the provisions in Australian Consumer Law that deal with this kind of conduct are an extension of laws that prohibit companies from making false or misleading representations.

    And while Online Centric has not been fined in this case, Harris says closing down a business is “in many cases … a more effective remedy than fining someone”.

    “It’s a pretty clear-cut case and the court has shut down the business as a result,” Harris says.

    Consumer Affairs has not indicated if individual customers were left out of pocket as a result of Online Centric’s conduct and Harris says this may have also been a factor in the court’s decision not to fine the company.

    But Harris says the decision has broad ramifications for Papadopoulos, who has not only had her business shut down but also her ability to conduct other businesses.

    “It will limit what she can do in the future,” he says.

    Harris says the case should serve as a warning for small businesses who may have worked with Online Centric in the past, as well as those who may be tempted to bend the rules.

    “Some directors think they can just go and start up another business, but that’s not the case,” he says.

    SmartCompany contacted Papadopoulos but did not receive a response prior to publication.

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    Letting your employees catch an UberX ride instead of a taxi home after a work function could breach your duty of care and could potentially open you up to criminal penalties, workplace lawyers Holding Redlich have warned in Fairfax newspapers this morning.

    The popular ride sharing service has come under fire for being unsafe for passengers in the past, but Holding Redlich senior associate Joel Zyngier says the unregulated industry presents a liability issue for SMEs.

    Zyngier told SmartCompany under work health and safety legislation (WHS), an employer has a primary duty of care to take all reasonably practicable steps to ensure the health and safety of its workers while at work, including the vehicle in which an employee is travelling for work.

    “Employers have to choose the travel option that is the safest,” says Zyngier.

    “If there is a safer option, employers must choose it, in the same way that if there was a safer way for a machine to be guarded, they must choose that.”

    Zyngier says the highly regulated taxi industry mandates on-board cameras and regular vehicle checks, both of which UberX does not.

    “Looking at it objectively, I think a reasonable employer would have to conclude a taxi is a safer mode of transport,” he says.

    Zyngier also says the cost difference for an SME is minimal and should not sway an employer when deciding how best to get an employee to or from work.

    “Small employers should realise the cheaper option should not be preferred when it is not the safer option,” he adds.

    Zyngier says a breach of the relevant WHS laws within a state or territory could lead to prosecution and penalties, including potential criminal charges.

    But David Rohrsheim, general manager of Uber Australia and New Zealand, has hit back, releasing a statement to SmartCompany today slamming the comments.

    "Based on the comments made to Fairfax by Holding Redlich, they appear not to have researched our processes, our thorough background checks or insurance standards, leading us to conclude their opinion was made on less than all the facts,” Rohrsheim says.

    Rohrsheim says all UberX drivers have cleared criminal history and driving history background checks and all UberX trips are fully insured and backed by $US5 million ($6.5 million) of contingent liability cover.

    “In addition, the safety features of the app means that the anonymity that exists with taxi trips is removed,” he says.

    “The rider has the driver's name, photograph, registration plate and car model before they enter the vehicle and can watch the car arrive at their pick up location so there is no standing out on the street trying to hail an anonymous ride.”

    “Further, if they choose to, the rider can share their journey in real time with a friend who can see the car travelling and arriving at the destination.”

    Rohrsheim says since its launch last year, Uber for Business has safely driven thousands of employees while “making huge savings for their companies and having clear and easy ways to expense their travel”.

    “We suggest people who are interested in the Uber platform join the millions around the world who ride with Uber every day and experience its superior safety standards and features for themselves," Rohrsheim adds.

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    A Victorian public servant who was verbally attacked by a manager, including being told he was a “piece of sh-t” and like “f-cking cancer”, has lost both a breach of contract claim and an adverse action claim against his employer in the Federal Court of Australia.

    Paul Regulski had worked for the Victorian Commission for Gambling and Liquor Registration since 2009 and was working as a compliance inspector when the altercation happened in March 2011.

    Regulski was called into the office of Mark Windisch, the manager of the compliance directorate, to answer questions about his alleged disregard of and poor communication with his team leader, Lisa Jones.

    Jones had complained about the behaviour of several team members, including Regulski, since taking on the team leader role in 2010. Windisch had called Regulski into the office to discuss Jones’ concerns in “a state of anger”.

    Regulski told the court when he walked into Windisch’s office, his manager had slammed the door on his foot, telling him to “Get in my f-cking office. Sit your f-cking arse down.”

    “What followed could not be described as a conversation,” Justice Jessup told the court.

    “It was almost completely one-sided. The applicant was given little or no opportunity to say anything.”

    Regulski faced an expletive-riddled attack from Windisch in which he allegedly said, “I will take you down. I’ve dealt with bigger fish than you. No one is going to believe a piece of shit like you.”

    He continued, “You’re useless. You’re fucking toxic. You’re fucking cancer”.

    The court heard Regulski was given no opportunity to respond, and after the attack he did not return to work, instead going on sick leave and then worker’s compensation.

    In a claim for damages for breach of contract, Regulski argued the Victorian Commission for Gambling and Liquor Registration had an obligation to treat him in good faith, which extended to not being verbally abused.

    But Justice Jessup found there was no implied term of good faith in employment contracts and ruled Windisch had not acted in bad faith towards Regulski.

    “There are several strong criticisms which might be directed to Mr Windisch for the way he treated the applicant, but acting in bad faith is not one of them,” said Jessup.

    Employment lawyer and M+K Lawyers partner Andrew Douglas told SmartCompany Regulski’s second claim also failed because adverse action claims consider the intention behind the treatment, as it relates to a workplace right.

    “The test is, what is the intention of the person doing the bad act?” says Douglas.

    “If the intention relates to the protected attribute, then it will be unlawful. But if it’s just a person being bad, rude or offensive, it’s not an adverse action.”

    But Douglas says Regulski may potentially have made a case for other remedies such as bullying or wrongful dismissal.

    A spokesperson for the Department of Justice and Regulation, which was handling the control of the Victorian Commission for Gambling and Liquor Registration at the time of Regulski’s employment, told SmartCompany the finding supports the department’s long-held position that the claims made in this case were unproven and not supported by the facts. 

    "The department strongly values and promotes a healthy, safe and respectful workplace," said the spokesperson.

    "We have a zero tolerance approach to bullying and we will take any necessary actions to investigate and stamp out bullying wherever it exists."

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    A former IBM employee has been ordered to pay legal costs of $150,000 after failing to convince the Federal Circuit Court she was discriminated against after she returned to work from maternity leave.

    Kelly Yeoh took maternity leave from her position as a software engineer at IBM Australia’s Canberra operations in July 2008, returning to work in the company’s South Australian offices in July 2009 following a move to Adelaide.

    After a series of performance reviews and an extended period of sick leave, Yeoh’s employment at IBM Australia was terminated in March 2014.

    In 2009, Yeoh had requested to return to work from home on a part-time basis for 20 hours a week, but after her supervisor raised concerns about her productivity, she accused her employer of making her work between 40 and 60 hours a week. Yeoh claimed her workload could not be completed within 20 hours and this amounted to discrimination.

    The court heard Yeoh made verbal complaints against IBM but chose not to put them in writing because she was fearful of the consequences.

    But Judge Sandy Street found Yeoh was never directed by IBM Australia to work longer hours and rejected her claims she was discriminated against on the basis of her gender or the fact she was a young mother.

    Street also rejected Yeoh’s claims her depressive and panic disorders were contributed to by IBM and that IBM breached its contract with her.

    “While it is true that the applicant did make complaints about her workload, I do not accept that she was working more than 20 hours a week on any regular basis,” Judge Street said in his judgment.

    “I accept that she was working odd hours, due to the flexibility that she had as a result of her own request for that part-time employment.”

    “I do not accept that the applicant was given a workload that required her to work the excess of 20 hours per week.”

    Judge Street also said Yeoh was “clearly a highly intelligent, articulate and capable individual who was well able to formulate and make written complaints if she chose to do so”.

    A spokesperson for IBM told SmartCompany this morning IBM's equal employment policy and practices "promote a culture of inclusion for all, regardless of gender, race, religion or sexual orientation". 

    "Employment equality is firmly entrenched at IBM and the diversity of our workforce is critical to our company's success," the spokesperson says. 

    "The court found in IBM's favour, acknowledging our commitment to policies that promote a supportive workplace, and that evidence was fabricated to advance the case against the company."

    Ben Tallboys, senior associate at law firm Russell Kennedy, told SmartCompany because Yeoh brought her case under the Sex Discrimination Act, it was up to her to “prove IBM’s actions were taken for a discriminatory reason and she was exposed to the risks of having to pay IBM’s legal costs if she could not do so”.

    This is unlike discrimination claims under the Fair Work Act, in which it is up to the employer to demonstrate they did not act in a discriminatory way.

    Tallboys says Yeoh’s claims were ultimately dismissed because the court “did not accept her version of events”. And the end result is Yeoh having to pay IBM’s legal costs.

    “This sort of outcome will typically be devastating for an individual, or even most small businesses,” Tallboys says.

    “The employee represented herself at the hearing and so this case again highlights the importance for both the employer and the employee in getting the right legal advice before running or defending a claim in court.”

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    A Nando’s restaurant in Brisbane has been caught withholding the wages of a new staff member in a bid to keep them on the job for at least three months.

    The former employee, who was a 25-year-old Korean national in Australia on a working holiday visa, was underpaid thousands of dollars after his wages were unlawfully withheld at a Nando’s franchise in Kelvin Grove.

    The man was also not paid the correct minimum hourly rate or penalty rates at a sister restaurant in the inner suburb of Newstead, receiving as little as $12 an hour.

    The franchise’s sole director, Ujjiwal Singh, has signed an enforceable undertaking with the Fair Work Ombudsman and agreed to back-pay the former employee – who has since returned to Korea – more than $5000.

    The employee watchdog had previously received complaints from employees at both Nando’s restaurants.

    As part of the enforceable undertaking, both Singh and his companies will have to undertake training and commit to complying with federal workplace laws from now on.

    Employment lawyer Peter Vitale told SmartCompany withholding pay as “some form of performance incentive or retention incentive” is unlawful.

    “For award-based employees it’s simply not on,” Vitale says.

    “What the legislation says is that any deductions must be with the written consent of the employee, they must be for a specific amount and they must be for a purpose which is principally for the benefit of the employee.”

    Vitale says deductions from an employee’s wages are only lawful in a limited number of instances and even then it has to be for the good of the worker and not the employer.

    “So in that sense, deductions might be allowed for example in circumstances where the employee makes purchases from the employer or for instance, leases equipment or vehicles from the employer,” he says.

    “In some instances there might be staff loans which are to be repaid over time.”

    A spokesperson for Nando's Australia told SmartCompany the Nando's business model is a mix of company and franchisee-owned restaurants, with both the Kelvin Grove and Newstead restaurants franchise-owned.

    "While we take the personal wellbeing and employment rights of all staff very seriously, the restaurant employment practices at our franchise restaurants are the responsibility of the franchisees who hire staff to work in their businesses," she says.

    "Nando's Australia's franchise agreement is clear on the requirement for franchisees to assume responsibility for compliance with relevant laws, including employment and immigration law." 

    Acting Fair Work Ombudsman Michael Campbell said in a statement, in this case the act of deducting the employee’s wages served only to benefit the employer.

    “Deducting money from an employee’s wages as a punishment, or as some sort of performance management tool, is completely unlawful,” Campbell said.

    “And it is clearly not a constructive way of encouraging staff to improve their performance if there are performance issues that need addressing. Research shows that employees are most productive and motivated when they are part of a workplace culture in which their contribution is valued and there are strong, positive leaders who encourage them to perform at their best.”

    While Campbell acknowledged that workplace laws are “complicated”, the employer watchdog does not look kindly on businesses who exploit overseas workers.

    “We know workplace laws can seem complicated for the uninitiated, but we ask small business to use the tools and resources that we provide for them and inform themselves,” he said.

    SmartCompany contacted Ujjiwal Singh but did not receive a response prior to publication.

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    Tobacco retailer Freechoice has hit out at Australia’s “very broken” workplace relations system after the Fair Work Commission ruled one of its former employees was unfairly dismissed despite being responsible for a botched order from a supplier that cost the company more than $600,000.

    Kim Evans was hired as the store manager of the Freechoice outlet in Bentleigh, Victoria, in September 2012 but had her employment terminated in October 2014 due to a number of performance-related issues.

    Evans received a number of warning letters from her employer, including a letter on July 16, 2013, about failing to check stock deliveries to her store on multiple occasions.

    In July 2014, Evans was found to have incorrectly charged major client, AA Holdings, to the value of $600,000 when she mistakenly invoiced the company for 650 units of a product when only 50 units were delivered. This was followed a month later by an incident in which Evans was told to place another order with AA Holdings but failed to follow up on whether the order was received.

    A second warning letter was sent to Evans in September 2014 and that letter referred to both incidents with AA Holdings and a month later Evans received a letter informing her that her employment had been terminated. That letter referred to two more incidents, which Freechoice said demonstrated Evans’ “unacceptable behaviour, attitude and poor performance”.

    However, the Fair Work Commission ruled against Freechoice, with Commissioner Michelle Bissett finding the termination of Evans’ employment was harsh, unjust or unreasonable and ordering Freechoice to compensate her $24,098.88 plus 9.5% superannuation in compensation.

    Given the circumstances, Bissett said it would not be appropriate to reinstate Evans.

    Commissioner Bissett said she was not “convinced that the errors demonstrate some systemic problems with [Evans’] performance such that they provided a sound a defensible reason for the termination”.

    Instead, Bissett said Freechoice failed to provide Evans with support she sought from her supervisors, including additional resources, and was only given a “limited period” to improve her performance.

    But Freechoice human relations manager Suzanne Ozioko has slammed the “very extreme” decision, which she told SmartCompany is an “extremely disappointing outcome”.

    Ozioko says Evans was performance managed for a substantial period of time and there were “ample reasons” for her employment to be terminated. She said Freechoice is still “micro-managing” the relationship with AA Holdings after the invoice incident, the value of which amounted to the level of profit from that one store.

    Ozioko says Freechoice also rejects the amount of compensation ordered for Evans, which she says was able to quickly find employment with another company.

    “[Evans] moved on from our company six months ago or longer and we’re still dealing with the aftermath,” Ozioko says.

    “We’re the victim of a very broken system.”

    Ozioko says Freechoice probably could have saved money if it had chosen to settle the case with Evans earlier but decided to defend its actions “as a matter of principle”.

    She says it is extremely difficult for small and medium-size Australian businesses to win a case before the Fair Work Commission and the end result is employers being “afraid to performance manage” employees out of fear for what could happen to their company.

    “We’re dealing with a very broken system on an ongoing basis,” she says.

    Workplace lawyer Peter Vitale told SmartCompany the evidence presented to the commission shows three areas of difficulty on the part of Freechoice.

    “First of all, the employer didn’t appear to raise the issues [with Evans] quickly enough,” Vitale says.

    “Secondly, when the issues were raised, the employee was only offered a short time to rectify the performance issues.”

    “Thirdly, they didn’t offer the employee appropriate support in the view of the commission and there was a suggestion that the employer failed to give [Evans] adequate instruction.”

    “If the employer had handled this in a different way, there could have been a very different result.”

    Vitale says employers must act quickly if they believe an employee is underperforming.

    “The lessons really are, if you have genuinely serious performance concerns, then you need to demonstrate how serious they are by raising them quickly and comprehensively,” he says.

    Vitale says employers must also be able to show they have offered their employees appropriate training and support, and “offered them a reasonable period to rectify performance difficulties”.

    Vitale says Fair Work will determine what constitutes a “reasonable” time period based on a range of factors depending on the circumstances of the individual case and there is no set period of time all employers must give employees.

    And the range of factors can be quite broad, says Vitale, saying the commission will look at how long an employee has been working for the company, the difficulty and frequency of the task they have been asked to complete and the amount of training they have previously received.

    Finally, Vitale says it is essential for employers to be able to substantiate any claims made about an employee’s performance.

    “The commission noted for instance the employer identified insubordination as a concern in its warning letters [to Evans], but it provided no evidence of insubordination,” he says.

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    The Fair Work Commission has ordered a small business with 13 employees to pay $6016 in compensation in an unfair dismissal case involving a former employee who delivered products to customers with a half-shaved beard and showed a company director a hole in his trousers.

    The latest case comes after an insurance broker was awarded $300,000 after the NSW District Court found he was wrongfully dismissed by his employer for drunken behaviour at a work conference earlier this year.

    In the most recent case, Ambrose Haulage of Goondiwindi in Queensland claimed former employee Martin Cochrane turned up to work with a half shaved beard when delivering product to customers.

    Ambrose Haulage director Jamie Ambrose said this showed a disregard for his business. However, when Ambrose raised this with the Cochrane, the response was “where is your facial hair policy?”

    In a separate incident, Ambrose claims he raised concerns about how Cochrane interacted with his colleagues. Rather than attempting to see how this might impact upon the business, Cochrane’s comment was: “I’m here to make money not friends.”

    Ambrose also claims Cochrane came into his office one day to show him a hole in his trousers, in a manner he found disrespectful. Cochrane said it was meant to be a “humorous incident” and he did not mean to cause offence. However, Ambrose did not take any action at the time, or issue a warning about the incident.

    The final straw came on November 1, when Cochrane failed to turn up for a night shift. Both parties agree that Cochrane was supposed to be informed about the shift by another employee but that other employee failed to make the call.

    When Ambrose called later to confirm the shift, Cochrane said he planned to be in bed by 9.30pm that night and then threatened that he might forget to work the following day as well. These were comments Ambrose found inappropriate and he decided to fire Cochrane.

    But Cochrane claimed he had been unhappy with the shifts he had been given for some time.

    In the decision, Fair Work Commissioner Chris Simpson said the earlier incidents, including the hole in the trousers, were “matters which were not directly related to the reasons relied upon by the [Ambrose] to justify its decision to terminate the [Cochrane]”.

    Simpson found Ambrose failed to provide Cochrane with a reason for his dismissal and said he made the decision to terminate Cochrane’s employment before he knew the full details of the situation, which led to the dismissal being unfair.

    “It is not disputed by [Ambrose] that [Cochrane] was not provided with a reason for his dismissal at the time of termination and it is not disputed that [Cochrane] was not afforded any opportunity to respond to the reasons for his dismissal,” Commissioner Simpson said.

    “[Ambrose Haulage] is a small business and this would be likely to impact on the procedures followed in effecting the dismissal. [Ambrose] did not have a dedicated human resource management specialist or expertise in the enterprise and again this would be likely to impact on the procedures followed in effecting the dismissal.”

    Given the strained relationship, Commissioner Simpson found that it was unlikely Cochrane would have continued working for Ambrose for more than six weeks. Despite this, Cochrane was awarded $6016 in damages.

    Maurice and Blackburn associate for industrial law, Daniel Victory, told SmartCompany there are two crucial small business lessons from the case.

    “The first is that dismissing an employee is a very serious decision and before an employer does so, they need to properly investigate the situation. In this case, an employee didn’t turn up for work, but that employee wasn’t told beforehand. The commission found that was not a valid reason for a dismissal,” Victory says.  

    “Secondly, if an employer thinks an employee’s conduct is inappropriate, they need to tell them and give them a chance to change their behaviour.”

    SmartCompany contacted Ambrose, who declined to comment for this article.

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    A medical clinic that told erectile dysfunction patients their penises could shrink if they did not seek treatment has been found guilty of unconscionable conduct in the Federal Court.

    Justice Anthony North yesterday found the Advanced Medical Institute (AMI) had used hard-selling sales tactics to convince customers to buy its nasal sprays and oral drips for longer-lasting erections, despite the products having no scientific basis.

    AMI has previously come under fire for its advertising, which television viewers said implied the men are at fault for premature ejaculation.

    The Australian Competition and Consumer Commission brought the action against AMI, alleging the company’s salespeople had made a series of unsubstantiated medical claims when signing customers up to treatment plans, which were in some cases 18 months long.

    Among the phrases provided in their training material, AMI salespeople were directed to tell customers untreated premature ejaculation could lead to penis shrinkage, psychological impotence and even prostate cancer.

    “Training salespeople to trap vulnerable men into agreeing to treatment programs by the use of high-pressure selling was dishonest conduct,” North said in his lengthy judgment.

    “It is immoral to seek to harness the fears and anxieties of men suffering from ED [erectile dysfunction] or PE [premature ejaculation] for the purpose of selling medical treatments. To target the patient’s vulnerability in this way is to use an unfair tactic and that is a possible marker of unconscionable conduct”.

    The court heard AMI – which was purchased in 2011 by a company named NRM Corporation, another respondent in the case – turned over close to $55 million in revenue from such treatments in 2009-10 alone.

    As a part of Justice North’s orders, AMI chief executive Jacov Vaisman has been banned from continuing in his role in the operation.

    North also ordered AMI to pay compensation to 14 affected patients, that the company only offer patients contracts of a maximum of two months, including a five-day cooling off period, and ordered the company to pay the ACCC’s costs.

    Rohan Harris, principal at law firm Russell Kennedy, told SmartCompany AMI had fallen foul of unconscionable conduct laws by using hard-sell tactics to take advantage of someone in a situation of disadvantage.

    “Any medical issue that a consumer might have, understandably falls into the category of disadvantage,” says Harris.

    “Bullying and intimidation is not a legal sales tactic, it’s the sort of tactic that will eventually get you into difficulty, particularly when you’re dealing with consumers in some sort of disadvantage or vulnerable situation.”

    Harris says the case shows businesses must make sure sales staff are not making unsubstantiated claims outside of their knowledge.

    “These sorts of statement weren’t made by medical practitioners, they were made by salespeople,” says Harris.

    “You can’t have a situation where salespeople are making statements about someone’s medical conditions – that is the domain of qualified medical professional.”

    SmartCompany contacted AMI but did not receive a response prior to publication.

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    Wellness app developer and blogger Belle Gibson has admitted she invented multiple cancer diagnoses in an exclusive interview with the Australian Women’s Weekly magazine.

    Gibson rose to fame in 2011 when she announced she had received a terminal brain cancer diagnosis and claimed she had healed herself by restricting her diet to certain foods, positive thinking and wellness therapies.

    As a result of her claim that thesepractices had cured her of terminal cancer, Gibson launched a recipe book and hugely successful app called The Whole Pantry. She built an online community of cancer sufferers and spread her message about the power of healthy eating and natural therapies.

    Her entrepreneurial ventures were both successful and lucrative – the Whole Pantry app was downloaded over 300,000 times. Gibson hosted a series of events to publicise the app and the cookbook, claiming to also be raising money for key cancer support charities.

    It later came to light that Gibson had failed to donate over $300,000 that she had pledged to a number of charities. In one instance, four of the five charities listed as beneficiaries of an event had no knowledge that the event was taking place.

    The blogger, who called herself Healing Belle, wrote about many subsequent cancer diagnoses during her rise to prominence. At one point she claimed to have suffered a stroke and been diagnosed with cancers of the liver, uterus, spleen and blood. At another stage she claimed her cancer was a result of cervical cancer vaccine Gardasil, and began campaigning against vaccinations to her following on social media.

    Questions began arising earlier this year when it was discovered Gibson had misappropriated funds, and her friends began casting doubt on the veracity of her diagnosis. She was asked to provide names of doctors who diagnosed her with the various cancers, but she refused. Sheeventually admitted some of the cancers could have been a “misdiagnosis”.


    She began deleting several references to her illness on social media and her company released a statement saying the missing charity funds were a result of a cash flow issue.

    But, in the AWW magazine which is on newsstands tomorrow, Gibson has admitted that she fabricated the entire story. She does not have, and has never had, cancer.

    When Gibson was asked directly whether she had the disease, she replied: “No. None of it is true”.

    When asked why she lied about her condition, Gibson failed to give a straight answer.

    “I am still jumping between what I think I know and what is reality. I have lived it and I’m not really there yet,” she said.

    “If I don’t have an answer, then I will sort of theorise it myself and come up with one. I think that’s an easy thing to often revert to if you don’t know what the answer is.”

    Gibson did say her “troubled” childhood might have resulted in her decision to profit from the invented story.

    “When I started school, my mum went, ‘My daughter is grown up now’. All of a sudden I was walking to school on my own, making school lunches and cleaning the house every day,” she said.

    “It was my responsibility to do grocery shopping, do the washing, arrange medical appointments and pick up my brother. I didn’t have any toys.”

    Gibson said she has received a strong backlash since questions began arising about her health and her misuse of funds.

    “In the last two years I have worked every single day living and raising up an online community of people who supported each other. I understand the confusion and the suspicion, but I also know that people need to draw a line in the sand where they still treat someone with some level of respect or humility — and I have not been receiving that.”

    Gibson’s app and book deal have been dropped and her accountants have been instructed by authorities to give anyremaining funds she has to the charities Gibson pledged money to during herfundraising. The police have confirmed they will not be pressing criminal charges against her.

    This story originally appeared on Women's Agenda.

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    Discount deals site Spreets must pay a fine of $600,000 to the Australian Competition and Consumer Commission for making false or misleading representations to consumers, the Federal Court has ruled.

    The decision comes after the ACCC launched the action in June 2014, with ACCC commissioner Sarah Court saying in a statement the competition watchdog will continue to prioritise “online consumer issues”.

    “All online businesses, including those offering daily deals, must ensure that representations made on their websites are clear and accurate, particularly in relation to price and any restrictions on a deal being offered, including availability and redemption conditions,” Court said.

    “The court’s decision is a further reminder for online traders that the Australian Consumer Law applies to them, including consumer guarantees.”

    Melissa Monks, special counsel at King Wood Mallesons, says the takeaway from this case and others similar to it is discount deal websites must communicate all aspects of deals.

    “Disclosure has to be prominent,” Monks says.

    “It’s important that the reality matches what’s being offered.”

    Monks says the ACCC relied on section 29 of Australian Consumer Law, which covers “false or misleading representations about goods and services”.

    Among other things, the section prohibits a person from making false or misleading representations with reference to “the price of goods and services”.

    “It’s very easy from an evidentiary perspective” to determine if an online business is violating Australian Consumer Law, Monks says. 

    “ACL applies equally to online proprietors as it does to bricks-and-mortar retail.”

    The case comes after the ACCC prosecuted two other “deal-of-the-day” websites in the past 18 months.

    In December 2014, LivingSocial made an undertaking in court not to make false or misleading representations after the consumer watchdog raised concerns about the site’s consumer contracts.

    After making false or misleading representations to businesses and customers, Scoopon was ordered by the Federal Court to pay a total of $1 million in penalties in December 2013

    A review of ACL will happen this year, but Monks says the cases prosecuted by the ACCC show the legislation is working as it should.

    “The message is really clear… if your claim marries up to what you’re offering, then you’re fine,” Monks says.

    SmartCompany contacted Spreets for comment but did not receive a response prior to publication. 

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    A mining site worker in the Pilbara who held a piece of broken glass to the throat of his co-worker has lost his unfair dismissal claim before the Fair Work Commission, after he argued his actions were just part of the “boys being boys” culture of a mine site.

    Fortescue Metals Group fired Perth man Adam Rouse on December 18, 2014, following an incident where he and some co-workers were enjoying a drink outside of work hours.

    Rouse, who represented himself before the commission, told Fair Work that the incident occurred when he left the table where he was sitting and a glass bottle smashed at his feet.

    Distressed that someone would show such a lack of concern for his safety, Rouse said he picked up part of the smashed bottle, returned to the group and said, “Who the fuck threw that?”

    One of the workers put up his hand and admitted throwing the bottle, prompting Rouse to hold the piece of glass to the worker’s neck.

    He then said, “Do you know what I do to people who throw bottles at me in Perth? If you did that in Perth I’d cut your tongue out.”

    The worker’s neck started to bleed, which Rouse described to the commission as, “small scratches [that] were no bigger than a shaving cut”. Rouse said he let the worker go after he realised he had hurt him.

    Rouse told Commissioner Gooley he considered his comments a statement of fact and not a threat and believed his dismissal unfair because the worker who threw the bottle only received a warning.

    Rouse argued his comments were not unusual for a mine site, saying what would be considered violence in mainstream society is just “boys being boys” on a mine site.

    But Gooley rejected the argument, finding Rouse had acted disproportionately and not in self-defence.

    “Mr Rouse in that situation had a number of options. However, none of those options involved taking a broken piece of glass and holding it at the other worker’s neck and threatening the other worker,” said Gooley.

    “I do not accept Mr Rouse’s ‘things are different on a mining site’ defence. This conduct is unacceptable anywhere,” the commissioner continued.

    “Mr Rouse had other options but he did not use them. Mr Rouse could have made his feelings about the incident clear without making threatening statements whilst holding a piece of glass to the other worker’s neck,” said Gooley.

    Gooley rejected Rouse’s application for unfair dismissal, which was also not filed within the 21-day application period, finding there were no exceptional circumstances to grant an extension of that time to move forward with the case.

    Employment lawyer and principal at M+K Lawyers, Andrew Douglas, told SmartCompany Rouse’s “boys being boys” argument did not detract from the seriousness of his actions.

    “Commissioner Gooley said it doesn’t matter about the particular cultural differences in a workplace, when you threaten someone with a broken bottle, draw blood and make threatening comments, there is no reasonable chance of success,” says Douglas.

    While Douglas says employers can run the risk of undermining a dismissal if they fail to follow the appropriate processes after a violent threat takes place, a large company like Fortescue would likely have the correct policies and procedures in place.

    “Violence is never acceptable and that is certainly something you need to tell employees very clearly in their induction and reinforced in training,” he says.

    Douglas says such policies are particularly important in industries where there is an inclination towards roughhousing and warns that employers risk undermining themselves if they are seen to condone such culture.

    “Allowing roughhousing is the thin end of the wedge. A good culture is where people feel safe and respected. If you allow bad behaviour to occur and say it’s just the culture, you compromise yourself.”

    SmartCompany contacted Fortescue Metals Group but did not receive a response prior to publication.

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    Bianca Rinehart, daughter of Australia’s richest woman Gina Rinehart, has accused her mother of withholding information in court, amidst their ongoing legal dispute in the Federal Court over the family’s finances, according to Fairfax..

    Bianca Rinehart yesterday told the court emails of hers now in the possession of Gina Rinehart’s legal teams were hacked and deleted, suggesting her mother took the documents.

    "Recently all my emails have been deleted, which I didn't do, and it's not difficult to imagine who might have [and] in whose interests that would have been," Rinehart said.

    Bianca Rinehart claimed Hancock Prospecting had a policy of "withholding or providing sanitised information" to her and her brother, John Hancock.

    "It's very hard to get absolute versions of the truth out of the company," Bianca Rinehart said.

    According to the ABC, when Bianca Rinehart was asked if she was aware the allegation of deceptive conduct she made against her mother for allegedly withholding information was a very serious one, she quickly replied: "Yes, and I stand by it".


    The Iconic puts drone delivery on the radar


    Fashion marketplace The Iconic could be delivering parcels to its customers via drones within two years, according to chief executive Patrick Schmidt.

    Schmidt told Fairfax drone delivery is “something we are thinking about” as a way to maintain the company’s reputation as “pioneers or fast and flexible delivery”.

    But Schmidt said The Iconic would obviously have to wait for drone delivery to be approved in Australia first.

    “Delivery via drone is not yet regulated, so it probably depends on the legislators on whether that would be possible … but in the technology space, things happen fast, so you never know.”

    Founded in 2011, The Iconic has become a regular inclusion in SmartCompany’s annual list of Australia’s top online retailers. The retailer turned over $31 million in 2013 and has amassed an impressive 500,000 Facebook fans and more than 80,000 followers on Instagram.


    Shares down on open


    Aussie shares have traded lower this morning, dropping below the 6000 index level.

    Tristan K’Nell, head of trading at Quay Equities, said in a statement “a choppy Wall Street lead” was enough to keep the market subdued.

    “The market could also be taking a breather after a couple of days of outperformance and also heading into the beginning of the [US] Federal Reserve’s two-day meeting, kicking off tonight,” K’Nell said.

    The S&P/ASX 200 benchmark was down 19.3 points to 5963.4 points at 11.55am AEST. On Monday, the Dow Jones closed 42.17 points lower, down 0.23% to 18038 points.

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    The world’s third largest developer of video games has been slapped on the wrist by the Australian competition watchdog for potentially misleading customers about their right to a refund.

    Electronic Arts, which runs the Origin video game distribution platform, has acknowledged its representations to consumers about refunds may have breached Australian consumer law.

    From January 2012, EA said in its terms and conditions and through customer support representatives that Australians were not entitled to any refunds for digitally downloaded video games purchased through Origin.

    As a result of action from the Australian Competition and Consumer Commission, EA has agreed to amend its terms and conditions and will implement a compliance program with risk assessment measures put in place along with staff training.

    In addition, the company has provided a court enforceable undertaking to the competition watchdog promising not to tell customers it has a ‘no refunds’ policy.

    Read More: Your business needs a refund policy

    ACCC chairman Rod Sims said in a statement businesses selling downloadable goods should not avoid their legal responsibilities.

    “It is a breach of the Australian Consumer Law for businesses to state that customers are not entitled to refunds under any circumstances,” he said.

    “Where a product has a major failure, consumers can insist on a refund or replacement at their choice. Representations that this right has or can be excluded, restricted or modified are false or misleading.”

    Last financial year Electronic Arts earned more than $US3.5 billion in net revenue, up 27% from the previous corresponding period.

    A spokesperson for EA Games Australia says the company is pleased to have worked cooperatively with the ACCC to resolve its concerns and ensure its players in Australia "have the best possible experience when purchasing and playing EA games".

    "In addition to rights available to our players under the Australian Consumer Law, we are also proud to offer our global, industry-leading Great Game Guarantee for digital returns within certain timeframes if anyone is not satisfied with a digitally-downloaded game from EA," the spokesperson says.

    This article was first published on StartupSmart.

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    A former wool buyer has been handed a $15,000 penalty in the Melbourne Magistrates Court for deceiving two clients into buying what they thought were 36 bales of pure Merino wool fleece.

    Ian Kenneth McLean, who previously operated a company called WAG Trading, pleaded guilty to two counts of obtaining property by deception after he was found to have sold the bales of wool as Merino fleece when in fact the wool was of a lower quality.

    Fairfax reports the court heard that McLean had altered the station brands and numbers on the wool bales when selling them to two companies, Techwool Trading and PJ Morris Wool.

    The court previously heard the alterations were uncovered when Techwool became suspicious of the wool’s quality. The company requested a further examination, which revealed “extreme differences” in the certificates produced by WAG Trading to verify the wool’s quality.

    Both companies are estimated to have lost a total of $58,000 because of McLean’s actions, with McLean making a return of between $3000 and $5000 on the transactions. He has since repaid the money.

    The court heard the transactions took place at a time in which McLean was under stress and financial pressure, and he has shown remorse for his actions. He has since lost his company and now works as a handyman.

    While the magistrate, Donna Bakos, said McLean’s actions amounted to a serious breach of trust and deterring similar behaviour from others contributed to her sentencing, she decided against imposing a conviction as that would harm McLean’s future employment prospects. She also said she is confident he would not re-offend.

    SmartCompany contacted Techwool Trading and PJ Wool but did not receive a response prior to publication. SmartCompany was unable to contact WAG Trading.

    Rohan Harris, partner at law firm Russell Kennedy, told SmartCompany this case was prosecuted by the police in a criminal jurisdiction, rather than in the civil jurisdiction for misleading and deceptive conduct.

    “The main distinction between criminal charge and a misleading conduct type of claim goes towards the intent of whoever has perpetrated the action and the ability to prove intent was there and present,” Harris says.

    “In many cases of misleading and deceptive conduct, often the intent is more difficult to prove and so law enforcement or the police are less inclined to get involved in what is a civil case.”

    “Often it is a fine line between a criminal matter and something that is a civil matter between two parties.”

    Harris says this appears to be a “clear case of deception and theft” and the parties were able to provide critical evidence of the alterations to the wool bales. And given McLean had repaid money to Techwool Trading and PJ Morris, there may not have been grounds to further pursue a civil action.

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    The Fair Work Commission has rejected an unfair dismissal bid by a transport company manager who allegedly sent threatening emails from his LinkedIn account, which was linked to his position with the company, and spoke to his boss in an “expletive rich” manner.

    Barry Harvey was employed by Egis Road Operation Australia from October 2013 as the logistics company’s manager of environment, safety and quality.

    He was terminated after 11 months in August 2014, after the deterioration of his relationships with several team members and his boss Scott Cain, the operations and maintenance manager of Egis.

    Egis gave evidence to the commission regarding a series of incidents involving Harvey’s performance and conduct, including using his LinkedIn account to send threatening emails to a person who may have been his ex-partner.

    Read More: Seven tips for creating an effective social media policy

    The LinkedIn emails, which Fair Work senior deputy president Peter Richards chose not to publish in his judgment because they were “particularly aggressive and abusive”, specified Harvey’s position title and employer.

    The recipient of the emails complained to the Egis head office, which prompted Cain to tell Harvey his conduct of drawing the employer’s business into personal emails had to cease immediately.

    Egis told Fair Work that Harvey also gave an “expletive rich response” to Cain’s attempt to manage him through a performance plan, including characterising Cain as “a bastard”.

    The transport company dismissed Harvey via a letter dated August 25, which included allegations of his refusal to report for duty, failure to perform normal duties and “total lack of respect and use of inappropriate language” directed at Cain.

    However, Harvey claimed he was the subject of bullying and argued he was dismissed from his employment on a summary basis and denied procedural fairness.

    But Richards found Egis had a valid reason for the dismissal because of the manner in which Harvey had conducted himself.

    “Ultimately, [Harvey] may or may not be guilty of the various claims made against him,” said Richards in his judgment.

    “But his fundamental and proven failing was in his inability – in a small work group – to conduct himself in a cooperative and civil way, and exhibit the desired suite of managerial traits.”

    Anthony Massaro, principal at Russell Kennedy Lawyers, told SmartCompany Harvey’s refusal to be civil with other employees and to engage constructively with Egis in regard to performance issues were valid grounds for dismissal, particularly given he was working in such a small business.

    “While it was found there were some procedural deficiencies, the commission was prepared to overlook those on the basis [Harvey’s] conduct could not fit into the workplace,” says Massaro.

    While Massaro says the case is a reminder for employers to follow proper policies and procedures when performance managing or dismissing an employee, he says there is a third lesson for employers raised by Harvey’s use of social media, including LinkedIn.

    “While it wasn’t determinative here, employees can be held to account for what they publish on social media, particularly where the employer can be identified,” says Massaro.

    “If [what is published] is capable of identifying an employer or capable of damaging an employer’s reputation, the commission is more likely to find a connection with the employment, even if the emails or abuse are not work related.”

    Massaro says the case is a reminder for SMEs to have solid social media policies in place.

    “It is much easier to act in response if they have policy in place that clearly establishes some boundaries around the appropriate use of social media,” he says.

    “If you have policies in place, it might make it easier to terminate or discipline an employer sending inappropriate emails on LinkedIn or abusive messages on Facebook.”

    SmartCompany was unable to contact Egis Road Operation Australia.

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    A former Australian Tax Office employee who asked if he could work from jail after he was sentenced to three years imprisonment for a sex crime has lost an appeal to win back his job at the ATO.

    Kevin Cooper, who in 2012 was convicted of two counts of sexual indecency against a minor in a foreign country, was attempting to appeal a previous decision made by in the Fair Work Commission to throw out his unfair dismissal bid.

    The former tax official was terminated from his role at the tax office in October 2013, after receiving a criminal conviction and a sentence of three years and two months jail time, with a non-parole period of two years.

    After he was sacked, Cooper suggested the ATO should have favourably considered his application to take a period of unpaid leave during his incarceration or the option that he carry out his duties whilst incarcerated.

    In November 2014, Deputy President Jeff Lawrence heard the case and found Cooper’s convictions were for a serious offence and a breach of the Australia Public Service Commission’s Code of Conduct.

    But in March this year, Cooper argued before a full bench against Lawrence’s decision, claiming the crimes were non work-related, private conduct. 

    But Justice Iain Ross, vice president Adam Hatcher and deputy president Val Gostencnik dismissed the appeal and upheld Lawrence’s decision, labelling Cooper’s submission that he could work from jail or take a period of unpaid leave while incarcerated as “fanciful”.

    “It is in our view fanciful in the circumstances of this case, to suggest that the [ATO] might have favourably considered an application by [Cooper] to take a period of unpaid leave during his incarceration,” said Ross, Hatcher and Gostencnik.

    “It is equally fanciful, given the nature of the [ATO’s] functions and the duties of [Cooper] whilst employed by the [ATO], to suggest as [he] did, that [he] might have been permitted to carry out his duties whilst incarcerated.”

    Employment lawyer Peter Vitale told SmartCompany the law will typically recognise an extended period of incarceration as a frustration of the contract of employment.

    “I don’t think you can sensibly argue it is possible to perform your duties in jail,” says Vitale.

    “I would have thought that was an incredibly optimistic application by the employee.”

    Vitale says the case highlights the issue of dismissal for non-work related conduct, recently brought to the fore by the sacking of SBS journalist Scott McIntyre.

    “This is becoming an area of great controversy, as we saw what happened with the SBS journalist,” he says.

    “The real question is whether or not the employer can show a close enough link between the actions of the employee and a breach of policies that impact upon their reputation.”

    Vitale says this case and McIntyre’s termination illustrate the importance of having solid workplace policies in place.

    “In this case, given we are talking about a public servant, it is reasonable for the government to expect its employees to respect the laws of the Commonwealth,” Vitale says.  

    “A serious breach of the law should form a legitimate basis for a policy that the employer could rely to terminate employee.”

    The ATO declined to comment when contacted by SmartCompany.

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