How a café owner's investigation process satisfied FWC
The Fair Work Commission (FWC) recently dealt with an unfair dismissal application brought by a long-serving barista against a small business café owner.
The case examined whether proper procedures were followed when dismissing the worker without notice after she had given her resignation.
The barista argued she had been unfairly dismissed after giving two weeks' notice. She maintained that obtaining customer phone numbers was to maintain contact with long-term customers who had become friends over her years of service, not to solicit business for a competitor as alleged by the café owner.
The barista had worked at the café for approximately 12 years before the business was purchased by new owners in October 2024. Just two months later, she was dismissed without notice after giving her resignation.
The FWC first addressed whether the worker met the minimum employment period required to make an unfair dismissal claim. The Deputy President found that as a "transferring employee," her service with the previous café owner counted toward this requirement. This was because the new café owner had not informed her in writing that her previous service would not be recognised.
Since the café had only 12 employees, it qualified as a small business under the Fair Work Act. This meant the case focused on whether the employer had followed the Code, which sets out simplified dismissal processes for businesses with fewer than 15 employees.
The café director alleged the worker had engaged in serious misconduct shortly before resigning. He believed she was telling customers not to buy coffee from his café and to see her in the future instead. He also claimed she was obtaining customer phone numbers and bullying other staff members.
The director had met with the worker on 21 November 2024 to discuss concerns about her workplace performance and behaviour.
That same day, she applied for a position at a new café opening just 40 metres away in the same shopping centre. She received and accepted this job offer by early December—the same day she was dismissed.
The FWC had to determine whether the dismissal complied with the "Summary dismissal" section of the Code, which allows immediate dismissal when an employer reasonably believes an employee's conduct is serious enough to justify such action.
When assessing whether the café owner complied with the Code, the FWC applied a two-step test from previous decisions. First, did the employer genuinely believe the employee's conduct was serious enough to justify immediate dismissal? Second, was that belief based on reasonable grounds?
The Deputy President found the café director genuinely believed the worker had engaged in serious misconduct. The director had kept daily notes recording his observations, including instances where he heard the worker allegedly telling customers not to buy coffee from his café and instead to visit her in the future.
Importantly, the FWC did not need to prove the alleged misconduct actually occurred—only that the employer genuinely believed it had happened and had reasonable grounds for that belief.
The Deputy President noted: "The legislation requires a consideration of whether the particular employer, in determining its course of action in relation to the employee at the time of dismissal, carried out a reasonable investigation, and reached a reasonable conclusion in all the circumstances."
Although the café director did not formally present the allegations to the worker before dismissal, the FWC found he had conducted a reasonable investigation given the circumstances.
The Deputy President considered several relevant factors: the small size of the business, the recent purchase of the café just two months earlier, the worker's imminent move to a competing café nearby, and the director's own observations.
Before making his decision, the café owner had spoken to customers, his co-owner wife, and other café employees. The FWC deemed this level of investigation reasonable for a small business in these specific circumstances.
The Deputy President specifically noted that factual findings about whether the worker actually intended to solicit customers for her new employer were not necessary for determining whether the dismissal was fair under the Code.
The FWC explained that when small businesses conduct summary dismissals under the Code, the focus is on the employer's belief and its reasonableness, not on definitively proving the misconduct occurred.
After reviewing all the evidence, the FWC concluded that the café owner had complied with the Code in relation to the dismissal.
The Deputy President stated: "Having regard to all the circumstances, I am satisfied that [the employer] complied with the Code in relation to [the worker's] dismissal. It follows that [the worker's] unfair dismissal application cannot succeed and must be dismissed."
