Husband-and-wife resort managers fired together: Was it unfair dismissal?

The Fair Work Commission (FWC) recently dealt with the unfair dismissal claim of a husband-and-wife team who managed a resort together.

Meanwhile, the employer claimed that the spouses deserved to be fired because of “poor performance,” including “bad language, theft” and taking sick leaves when they didn’t need them.

Husband-and-wife team

Matthew and Linda Stevens questioned the termination of their employment by Pecker Maroo Verano Pty Ltd. They were reportedly dismissed on the same grounds.

They are husband and wife who were employed to manage an accommodation in Noosaville. The FWC first determined if an employment relationship existed between the parties, and several factors supported this, including:

• The employer exercised control over the manner in which the spouses’ work was performed, hours of work and the location;
• The spouses could not perform work for others and were expected to report for all invoices and payments of suppliers;
• They were required to wear work uniforms;
• They were paid a weekly amount on a salary basis;
• They were provided 20 days of annual leave;
• They were provided some equipment to undertake their role;
• The role also required a car, which was not a substantive part of the role;
• They were provided with a company credit card to make purchases that were consistent with their role. They did not utilise business expenses.

The spouses’ letter

In their unfair dismissal claim, the husband wrote the following allegations against the employer, among others:

“I believe that the dismissal was unjustified as no notice was given prior to having a conversation on the phone. We had applied for emergency leave as [my wife] had not been well and was advised by her doctor to have 2 weeks off work immediately to ensure her return to good health.”

“My wife had spent a week in ICU prior to Xmas and also 2 other times over the past month. [She] had not been overly well since that time. During this time, [she] was forced to take annual leave to cover my wages.”

“We had sent an email to the Director of the company, saying we required the leave from Monday for 2 weeks.”

“Her response to me was a phone call saying she had decided to release us from our contract immediately. That I was not to go into the office and hand the keys to the office. Also to vacate our apartment within 2 weeks. A termination letter was received a little later that morning.”

It should also be noted that the spouses wanted to resign on other occasions but later withdrew their resignation letter because their employer told them that “if [they] left, [it] would take legal action for breach of contract.”

The employer’s argument

The employer argued that the termination of the spouses was valid because they did not perform the role they were required to do. It also brought claims against the spouses, including:

• “The doctor’s certificate written to Linda Stevens stating to have 2 weeks holiday was 5 days AFTER they demanded to go on holidays for 2 weeks;
• Why did [the husband] have to go on a holiday when he was not sick?
• [They] gave us an ultimatum on 3 separate occasions and threatened us that if we did not comply with their demands, they would abandon their post and terminate their contract;
• [Their] work performance and standards were not of a satisfactory standard to the owners and the body corporate and management of Pecker Maroo Verano Pty Ltd;
• The body corporate has also denied our option renewal request based on the poor performance of the onsite managers;
• As a NON-smoking resort – the owner of a unit complained about continuous smoking coming from the managers’ unit. [The wife] admitted she was still smoking. [Her husband] also admitted that [she] still smoked;
• Bad language heard by many people and the owners;
• Use of owners’ apartments FREE OF CHARGE for [their] family over a three-month duration. This equates to theft.”

It further said that their dismissal was “substantiated and justified.”

HRD previously reported about a federal court case where a husband resigned on behalf of his spouse. In that case, he allegedly talked to the employer on the phone and said his wife was “never coming back”.

The Commission’s decision

The FWC noted that “[the wife] requested leave because she had recently been hospitalised and required time off work, with [her husband] to take care of her.”

“It was a reasonable request for leave, but the employer said that this was not communicated in a timely manner.” The employer also claimed that the spouses were dismissed because of “poor performance of their duties,” but the FWC said that “this was not stated in the termination letter.”

“The termination letter states issues of ‘performance ethic’ and the failure to provide proper notice for annual leave. It does not take into account the poor performance of duties,” the Commission said in its decision.

And so, the FWC said it “can only consider the issues of ‘performance ethic’ and the failure to provide proper notice for annual leave in determining whether there was a valid reason for dismissal.”

“The spouses had sent an email to the employer regarding their reason for leave, and had contacted [their co-workers] stating that they were required to fill in. The parties’ agreement stated that the spouses must notify the employer by email and phone a week prior to undertaking annual leave. However, there was leave entitled to them called ‘other leave’.”

“[The wife] was unwell and had a medical certificate supporting her reasons for leave which could have been taken as ‘other leave’. There were employees who could cover [them] in their absence,” it added.

The Commission said that the reason for dismissal “appeared to be capricious, spiteful or prejudiced.”

“[They] had wanted to resign on two previous occasions. The employer had threatened legal action if they had resigned. The termination notice stated, ‘despite ignoring your two previous threats of walking out of Verano Resort and abandoning your post with Pecker Maroo Verano Pty Ltd, prior to Christmas 2022, we can no longer ignore your third threat of leaving the business with one days’ notice’,” it noted.

The Commission then concluded that the employer “did not provide a valid reason for dismissal” and also did not give the spouses a reasonable opportunity to respond.

“They did not have an opportunity to respond and were instructed to vacate the premises in two weeks and hand back their keys,” it said. Thus, the FWC ordered the employer to pay them the sum of almost $14,000.