Dismissal over failure to meet budget found to be reasonable
IN a recent decision the Australian Industrial Relations Commission found a manufacturing company was justified in dismissing a sales-person for consistently failing to meet budget.
The salesperson was an employee of the company for more than nine years as an account manager and was responsible for developing relationships with respect to food and beverage accounts. He had failed to meet his budgeted sales targets during 2003.
During this time the employer held monthly meetings with the employee regarding his poor sales performances against his budgeted sales target and discussed ways of improving his sales performance.
Between June and September 2003, the employer gave the employee four written warnings confirming what had been discussed at the reviews and requesting that he "immediately address the issues … and proactively demonstrate achievement of the key objectives" of his role and that, failing this, his "employment may be terminated on the grounds of poor performance".
Following his continual failure to meet budgeted sales targets during these months, the employer dismissed the employee in September 2003.
The employee brought an action before the commission for harsh, unjust or unreasonable termination, claiming among other things, that the company had set him an unrealistic budget and that there was a lack of training and assistance given to him.
The employer gave evidence that other comparative employees had met their budgets during this time and that at the meeting held with the employee between March and September he was given adequate training and assistance on how to improve his performance.
The employer also argued that during the performance review meetings the employee was given an opportunity to respond to the allegations of his continued poor performance and was warned that consistent failure to meet sales budgets could result in dismissal.
The commission accepted the employer’s evidence and found that the employee under-performed against his budgeted sales target over a lengthy period in 2003. It also found that given the meetings and the letters and the significance of his sales functions within his overall duties, the employee should not have been in any doubt that his poor sales performance against his budgeted sales target could result in the termination of his employment.
Although his service record was unblemished over the previous nine years, the commission found the employee failed to prove his dismissal was harsh, unjust or unreasonable.
The commission found the company afforded procedural fairness to the employee and in applying the principle in the Workplace Relations Act of ensuring a "fair go all round" is accorded to both the employee and the employer, it concluded that this procedural fairness outweighed the evidence to support a finding that the termination was harsh, unjust or unreasonable.
Carla Paratore, solicitor
9288 6940
Michael Jensen, associate
9288 6944
