Fair Work Commission awards fashion employee 22 weeks’ pay for unfair dismissal

The Fair Work Commission has found Dolina Fashion Group unfairly dismissed an employee of 17 years, without a valid reason for termination or appropriate warning.

Danae Moumtzis had worked with the company since July 1995 and during her time was responsible for developing their relations with larger brands, designing for Freewomen and acting as a buyer for Joi Stores.

Moumtzis was dismissed by Dolina on August 9, 2012, after allegations she had not met company product margins, had been buying fabric that was too expensive and her winter line wasn’t selling well.

Fair Work Commission vice president Watson ruled the decision was unfair.

“I consider the failure to establish a valid reason for termination and the failure to follow a process whereby there are appropriate warnings as to unsatisfactory performance and a proper opportunity for performance to improve, to be significant factors in relation to this matter…” Watson says in his ruling.

Throughout the proceedings Watson found Moumtzis was not given a fair chance to respond to the allegations, she was not given appropriate warnings or a chance to improve her performance.

“The evidence does not establish that Ms Moumtzis has been warned about the unsatisfactory performance, at least to the extent that her performance was at risk and that her termination of employment may result…” Watson says.

Moumtzis was originally given five weeks’ pay in lieu following her termination, but Watson ordered payment of 22 weeks’ salary, given Moumtzis does not wish to return to the company.

The precise figure of the payment was decided between the parties on January 21, 2013, but has not yet been publicly disclosed.

Employment and industrial relations lawyer Peter Vitale told SmartCompany this case was a straightforward example of unfair dismissal.

“Essentially Fair Work says in general terms that employers, before they terminate any employees (there are exceptions), must have a valid reason for the termination and they are required to follow a fair process. People must be provided with a reasonable opportunity to respond to the allegations, provide appropriate warnings and give them an opportunity to improve,” he says.

Explaining what Watson determined, Vitale says Dolina did not adhere to the clear, legal process of termination outlined by the Fair Work Act.

“Essentially he found to all intents and purposes Moumtzis has been called in and sacked without sound basis for the termination, there was no clear reason and therefore no valid reason for her dismissal,” he says.

Despite this breach of the dismissal laws, Vitale says employers are generally better educated about workplace legislation than they were a decade ago but some are still in the dark.

“Cases like this really demonstrate that there are still employers out there who don’t have even the most fundamental understanding of the Act,” he says.

Vitale offered some advice to small businesses:

• Seek help if you’re unfamiliar with the Fair Work Act.
• Give people clear performance expectation goals.
• Discuss with employees what will happen if expectations are not met.