Burks v Zanmarl Pty Limited

Industrial Relations Commission (NSW)|1999-06-16|Before: Sams DP

CITATION : Cullen and Carver [2004] NSWIRComm 206 APPLICANT: PARTIES : John William Cullen RESPONDENT: Robert and Carol Carver FILE NUMBER: 5282 of 2003 CORAM: Sams DP Termination of employment - unfair dismissal - handyman/cleaner - period of probation - letter of appointment included probation period - letter of appointment signed on first day of employment - alleged waiver of probation period - conflict of evidence - new evidence - notice of motion to reopen case - agreement on notice of motion - new evidence accepted - Regulation 6(1)(c) - whether probation period determined in advance - dismissal during notice period. CATCHWORDS : Held, evidence of respondent preferred - applicant aware of probation before commencing employment - probation period determined in advance - two letters acknowledging probation - probation period not waived - applicant misunderstood nature of full time employment and probation - applicant dismissed during probation period - applicant a class of employee excluded from Pt 6 ch 2 of the Act - application dismissed for want of jurisdiction LEGISLATION CITED : Industrial Relations Act 1996 Industrial Relations (General) Regulation 2001 Burks v Zanmarl Pty Limited (2000) 107 IR 187 Creedon v Clarvon Ltd t/as Footrest Shoes, (unreported, Sams DP, Matter IRC98/5227, 16 June 1999) Director General of the Department of Corrective Services v Mitchelson (1992) 26 NSWLR 648 Doring v Spinout Pty Ltd t/as Five Way Fusion [2003] NSWIRComm 306 CASES CITED : Erduran and the Menzies Group of Companies t/as Allcorp Pty Limited [2003] NSWIRComm 175 Followes v Knight Frank NSW Pty Ltd [2002] NSWIRComm 288 Hazel Lang and Reid and Vasely [2000] NSWIRComm 23 Key v Stuart Upton Pymble (unreported, IRC98/5503, 19 April 1999) Nicolson v Heaven and Earth Gallery Pty Ltd (1994) 57 IR 50 HEARING DATES: 04/02/2004; 05/28/2004; 06/04/2004 DATE OF JUDGMENT: 07/23/2004

APPLICANT: Ms K Maidla, Russell McLelland Brown, Solicitors LEGAL REPRESENTATIVES: RESPONDENT: Mr Robert Carver Ms Rachael Sutton, Moray and Agnew, Solicitors

JUDGMENT: - 19 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: SAMS DP 23 July 2004 Matter No IRC03/5282 John William Cullen and Robert and Carol Carver Application by John William Cullen re unfair dismissal pursuant to section 84 of the Industrial Relations Act 1996 DECISION [2004] NSWIRComm 206

1 On 23 September 2003, Mr John William Cullen ('the applicant') filed an application pursuant to s84 of the Industrial Relations Act 1996 ('the Act') in which he claimed he had been unfairly dismissed by Mr Robert Carver and Mrs Carol Carver, the owners of Clyde View Caravan Park, Batehaven ('the respondent').

2 Both parties were unrepresented at conciliation proceedings on 15 October 2003. The applicant acknowledged that when he commenced employment on 19 June 2003, he was on probation. He claimed however, that after a week of work, when he challenged his rate of pay, Mr Carver had waived the three month probation period and placed him on a full time hourly rate of $12.80, rather than the casual rate of $15.00 per hour. This was because he had worked more than 24 hours in the week.

3 Mr Carver maintained, that at no time, had he waived the applicant's three month probation period. Because of his unsatisfactory performance, he had terminated the applicant's employment on 17 September 2003, prior to the expiry of the probation period. Mr Carver submitted therefore, that the applicant was not able to bring a claim of unfair dismissal, by virtue of the exclusion provisions of the Act and Regulations.

4 Notwithstanding the respondent's submission, the Commission convened private conferences with the parties. However, no agreement could be reached. Pursuant to s87 of the Act, the Commission made a finding of unsuccessful conciliation and listed the matter for arbitration on the preliminary issue of whether the applicant was excluded from bringing a claim under Pt 6 ch 2 of the Act by virtue of s83(2)(b) of the Act and Regulation 6(1)(c).

5 The applicant provided a witness statement and gave oral evidence. He said that when he spoke to Mrs Carver, before taking up employment, she was aware that he had a permanent casual job as a handyman/cleaner at Carrol College and would only accept employment with the respondent if it was full time. Mrs Carver had told him three times the employment would be full time and that he would be trained in the tourism industry.

6 The applicant conceded that on his first day of employment he had signed the employment form which contained a reference to three months probation. However, Mr Carver told him in a meeting prior to commencing employment that it was "just procedure" and that probation would not apply to him. Moreover, Mr Carver told him he would be trained in the tourism industry and office work.

7 The applicant maintained, that at no time, was he told, or warned, that by signing the employment form, the employer could terminate his employment. Mr and Mrs Carver had led him to believe that he would be working for them for a long period of time. The applicant claimed, that at no time, had he been warned about his work ethic or performance. He believed the respondent had been happy with his work.

8 The applicant said he injured his back about two months after commencing work with the respondent. On the last day of his employment, he was push mowing the lawn and had complained to the caretaker, Dot Hawke, that his back was sore. At the end of that day a termination letter was waiting for him, even though Mr and Mrs Carver were on holidays at the time and were not due back for three weeks.

9 The applicant claimed that he would never have signed a three month probation letter if he knew that it could jeopardise his job. He would never have accepted the job on that basis, as he was already happily employed. Moreover, he had not agreed to any probation period prior to his first day of employment.

10 In cross examination, the applicant agreed that he and his wife had requested a letter for the bank, from the employer, regarding their employment arrangements, in order to amalgamate their bank loans. That letter dated 21 July 2003, was expressed in these terms: To whom it may concern, John Cullen is on 3 months probation period from 26 June to 17 September 2003 net wages $402.00 Per week. Sonja Bloomfield average wage is $200.00 per week. (Ms Bloomfield, the applicant's wife, also worked for the respondent)

11 Further in cross examination, the applicant was asked about the letter of appointment he had signed on 19 June 2003. The letter was expressed in the following terms: This letter confirms your employment as a casual cleaner with Clyde View Caravan Park for a three- (3) month's probation period. LIST OF DUTIES 1. Clean ensuite cabins vans villas & holiday units 2. Prepare units for cleaners 3. Scrub saucepans 2. Clean & maintain amenities block as necessary 3. Clean BBQ 4. Check gas bottles 5. Check gas bottles & deliver to sites 6. To maintain lawns & gardens in park where & when is necessary. It is noted that the terms and conditions of Clyde View Caravan Park Enterprise Agreement have been discussed and agreed to by you. This Enterprise Agreement totally replaces all terms and conditions of awards. The following matters do not reduce the minimum rates of wages for ordinary hours of work nor vary any other provisions of the Clyde View Caravan Park Enterprise Agreement. The following are the terms and conditions understood and agreed. You will receive the minimum Enter Prize (sic) Agreement rate 15.00 per hour, which includes 50c per hour Enterprise loading. Smoking Clyde View Promotes a healthy working environment by not allowing smoking by its employees within any of its buildings or facilities or motor vehicles.

12 The applicant denied that Mr Carver explained the terms of this letter to him.

13 The applicant said that when he received his first pay packet, he questioned the rate of $12.80 an hour which was different to the $15.00 quoted in the above letter. Mr Carver insisted that he explained to the applicant, three times, that because he worked more than twenty four hours per week, he was to be paid the full time rate, without the casual loading. The applicant denied that this was explained to him three times. He said it was explained once to him and once to him and his wife. The applicant believed that they all understood each other.

14 In re examination, the applicant said he had a verbal agreement that his job was full time and involved training in the industry. He understood that he would receive a full time permanent wage of $15.00 per hour.

15 Three persons provided statements and gave oral evidence in support of the respondent's case. Mr Robert Carver - Managing Director Mrs Carol Carver - Director Mrs Dot Hawke - Caretaker

16 Mr Carver said that at about 8.30am on 19 June, he and his wife and Mrs Hawke met with the applicant to discuss his letter of appointment. The letter set out the casual rate of pay, three months probation and the list of work duties. Each point was explained to the applicant and he signed the documents after he agreed that he understood their terms. The applicant also signed the various occupational health and safety work sheets before commencing physical work.

17 Mr Carver referred to the discussion he had with the applicant about a week later concerning his full time employment. Mr Carver deposed that he had never waived the probation period and, if the applicant's employment had been altered, it would have been in writing and signed.

18 Mr Carver said that when the applicant asked for a letter for the bank he had again told him he was on probation. He had told him that the bank would look more favourably on an employee who was full time, rather than casual.

19 Mrs Carver gave evidence that on 28 May the applicant called in and told her he was on his way to give his notice to his then employer. Mrs Carver said she had told him not to do so until she and Mr Carver had time to sit down and talk to him about the position. Two other people had applied for the job.

20 Mrs Carver said that on 2 June 2003, she and Mrs Hawke met with the applicant and went through the work contract with him, which included reference to probation, work safety data sheets and the rate of pay. Mrs Carver reiterated this evidence in cross examination. Mrs Carver referred to the meeting on 19 June in which the applicant signed all the paperwork. She said that this was a requirement for all new employees; in particular for new employees to be on three months probation.

21 Mrs Carver said that when her husband tried to explain to the applicant his wages on 27 June, the applicant had trouble understanding what was being said. Later when his wife came in, they discussed it again. The applicant had complained that this was "McDonalds money" and that the bank would not "look at him" for a loan. Mrs Carver said she told the applicant not to go to the bank while he was still on probation. However, on 21 July the applicant asked for a letter for the bank. It plainly stated he was on probation from 26 June to 17 September.

22 Mrs Hawke's statement corroborated the evidence of Mr and Mrs Carver. In particular she referred to the meeting on 2 June. She said that the applicant read through the letter of appointment and they had discussed its terms. In oral evidence, Mrs Hawke said she was usually present when new employees signed their employment documents and there was always discussion about probation. Every new employee, be they part time or full time, is told a three month probation period applies.

23 Ms Maidla, for the applicant, put that the applicant's evidence should be accepted and that the probation period was not discussed until 19 June - his first day of work. Thus, the probation period had not been determined in advance of commencing employment. The applicant's claim of unfair dismissal was therefore, competently before the Commission.

24 Mr Carver submitted that the terms and conditions of employment, including the probation period, were provided to the applicant on 2 June 2003. He had two weeks to consider the situation and willingly signed the letter of appointment on his first day of work.

25 Mr Carver said that he had explained to the applicant he was on a permanent rate of pay because he worked more than 24 hours a week. This did not mean he was not on probation. His probation period was further confirmed in the letter for the bank on 21 July. Mr Carver said he told the applicant it would look better if he was described as a permanent employee, rather then a casual.

26 The Commission reserved judgement on 2 April 2003. However, in a curious development, Mr Carver wrote to the Commission on 5 April 2004 seeking to have the case reopened in the light of new evidence, which the respondent now wished to place before the Commission.

27 The Commission, through my Associate, informed Mr Carver that for the case to be re-opened, a notice of motion would need to be filed. This was duly filed on 19 April by Moray and Agnew, Solicitors (now acting for the respondent). The notice of motion was expressed as follows: A. That the evidence in this matter be re-opened. B. That the affidavit of Carol Ann Carver sworn on 16 April 2004 and annexures ('the affidavit') thereto be admitted into evidence in the respondent's case. C. That the applicant be given leave if necessary to give evidence arising from any issues relating to the affidavit. D. That the respondent be permitted to cross examine the applicant in the event he is recalled to give evidence concerning issues relating to the affidavit. E. Any other order the Commission considers appropriate in the circumstances.

28 The notice of motion was listed for directions on 27 April and set for hearing on 24 May. However, on that day, the parties advised that an agreement had been reached in the following terms: 1. The applicant will consent to the respondent's Notice of Motion. 2. The respondent shall make written submissions to the Commission regarding the relevance of its additional evidence by 28 May 2004. 3. The applicant shall make written submissions in reply by 4 June 2004.

29 In view of this agreement, the Commission decided, to the extent it was necessary, to grant the notice of motion by consent. Supplementary submissions were subsequently filed according to the schedule referred to.

30 The supplementary affidavit of Mrs Carver went to the following new matters. After the conclusion of the hearing on 2 April, Mrs Carver discovered training records signed by the applicant on 9 June 2003. These were one page documents under the following headings: Cleaning amenities block Poisoning Mowing of lawns

31 Each document confirmed that the applicant had "been instructed in the above and understood the procedure." They were signed by the applicant and countersigned by the respondent. Mrs Carver deposed that these documents, and a number of others, including the letter of appointment, were given to the applicant on 2 June.

32 Mrs Carver said the applicant had returned the above three documents on 9 June. She said this had been a busy day after a long weekend, and she was too busy to spend more time with the applicant. She had told him not to sign anything else and bring all the paperwork back when Mr Carver would be present. This was to be the first day of the applicant's employment when all the paperwork would be signed.

33 In a supplementary submission, the respondent put that this evidence lent support to the sequence of events given by the respondent's witnesses, namely that: (i) It was the respondent's practice to record everything in writing in terms of the applicant's employment arrangements, role, responsibility and safety procedures and not enter into verbal agreements or arrangements with its employees; (ii) it was the respondent's practice to provide new employees with all documentation up front before signing up a new employee for employment; (iii) there was a meeting with the applicant on 2 June 2004 wherein he was provided with a collection of documents by Mrs Carver and Mrs Hawke. The documents were explained to him and he was asked to take them home and fill them out and bring them back; (iv) there was an opportunity for the applicant to consider the offer of employment by the respondent and the nature of his role and responsibilities prior to 19 June 2003;

(v) there were in all three "meetings" between the respondent and the applicant;

(vi) some of the documents were returned to the respondent on 9 June 2003 well prior to the applicant commencing employment with the respondent on 19 June 2003;

(vii) it is evident from the differences in handwriting and the colour of the pen ink that the documents were completed on different dates by the applicant with the assistance of another person and that Mr and Mrs Carver executed the documents in black ink following their return by the applicant;

(viii) the applicant signed the employment agreement before commencing any work with the respondent; and (ix) they show that the applicant had been provided with information relating to his duties and the requirements of the respondent in performing those duties safely prior to the commencement of duties on 19 June 2003.

34 Ms Maidla's reply submissions stressed that the new evidence did not establish that the letter of appointment was shown to the applicant before 19 June. She agreed that the applicant had two meetings with Mrs Carver before 19 June (2 and 9 June) and he had signed certain training documents on 9 June. However, the applicant maintained that there was no discussion during these meetings of a probation period and the document containing a reference to probation was not provided to him until the day he commenced employment. In any event, the applicant gave evidence that the period of probation was waived by a verbal statement from Mr Carver.

35 Section 83(2) of the Act exempts certain classes of employees from the unfair dismissal provisions of the statute: This Part does not apply to an employee who is exempted from this Part by the regulations. Any such regulation may only exempt specified classes of employees included in any of the following classes: (a) ……

(b) employees serving a period of probation or qualifying period,

36 The section is to be read in conjunction with s 6 (1)(c) of the Industrial Relations (General) Regulation 2001. The Regulation is expressed as follows: For the purposes of section 83(2) of the Act, the following classes of employees are exempted from Part 6 of Chapter 2 of the Act: a)……

c) Employees serving a period of probation or qualifying period, if the duration of the period, or the maximum duration of the period, is determined in advance and either: (i) the period, or the maximum duration, is 3 months or less, or (ii) if the period, or the maximum duration, is more than 3 months - the period, or the maximum duration, is reasonable having regard to the nature and circumstances of the employment,

37 It is a common feature of most new employment relationships for there to be a probation or trial period. Usually it will be expressed in writing; sometimes it will be discussed at the interview. Often it will be mutually agreed. The length of the probation will generally be proportionate to the seniority of the position. This is recognised by the Regulation, in that a probation or trial period in excess of three months may be reasonable having regard to the nature and circumstances of the employment. See Nicolson v Heaven and Earth Gallery Pty Ltd (1994) 57 IR 50.

38 Kirby, P (as he then was) in Director General of the Department of Corrective Services v Mitchelson (1992) 26 NSWLR 648 referred to the usual purpose of probation when he said: The very purpose of probation will often be to consider by observation of the probationer's work performance under trial, whether he/she is suitable to enjoy the privileges attaching to permanency.

39 In Creedon v Clarvon Ltd t/as Footrest Shoes, (unreported, Sams DP, Matter IRC98/5227, 16 June 1999), I observed that probation periods serve a dual purpose: On the one hand the purpose of a probation period is to test the employee's fitness and suitability for the position held. On the other, the employee can make an assessment of whether the position is really what was expected and, if not, conveniently resign. It is trite to observe that there are many more instances of probation employees being dismissed by the employer, than those who willingly resign.

40 In Burks v Zanmarl Pty Limited (2000) 107 IR 187, her Honour Glynn, J discussed the nature of probation employment in much the same way, albeit in the context of s106 (unfair contract) applications. At para 108 her Honour said: The usefulness of the probation period goes beyond such practical aspects as observing how competent an applicant actually is in a position to other matters such as seeing how the employee measures up in the workplace as to interaction with other people. A probation period offers the utility of finding out whether, for instance "paper" qualifications that may have been offered are a true indicator of the effectiveness of the employee in the actual job or that claimed experience is actually demonstrated in practice. and at para 109: I do not accept the applicant's contention that the probation period was unfair. It was one for the benefit of both parties. It allowed a reasonable period within which each party could assess his satisfaction either with the job itself and its conditions (the applicant) or, for the respondents, with the fitness of the applicant for the position. See also Followes v Knight Frank NSW Pty Ltd [2002] NSWIRComm 288 and Hazel Lang and Reid and Vasely [2000] NSWIRComm 23 .

41 I turn now to discuss the broader concept of probation; both as to its literal definition and what the ordinary bystander might understand the term to mean.

42 The Macquarie Dictionary defines probation as: 1. The act of testing. 2. The testing or trial of a person's conduct, character, qualifications or the like. 3. The state or period of such testing or trial.

43 The Shorter Oxford Dictionary definition is: 1. The action or process of testing or putting to the proof; trial, experiment; investigation, examination. 2. The testing or trial of a person's conduct, character, or moral qualifications.

44 In my opinion, the term probation is not some obscure, legalistic term that only industrial practitioners would understand. In my experience, it has broad common usage generally understood in the community. I have no doubt that the applicant knew what probation meant, but misunderstood how it applied to him. I shall return to this misapprehension later.

45 There appeared to be no argument that the applicant was dismissed within three months of commencing employment, although some confusion did arise in that the commencement date was agreed to have been 19 June 2003. Exhibit "B", the letter to the bank, describes his probation employment as being from 26 June to 17 September. The date of 26 June probably reflected the date Mr Carver placed him on the full time hourly rate. In any event, the termination of employment occurred within three months after 19 June, thus fulfilling the requirement of Regulation 6(1)(c)(i).

46 I would add, at this juncture, that for the purposes of this decision, it is unnecessary for the Commission to consider the reasons for the termination of employment, or whether such a dismissal was harsh, unreasonable or unjust within the meaning of Pt 6 ch 2 of the Act.

47 I turn now to the second leg of the Regulation. The expression "determined in advance" has been generally held to mean that a probation period is determined prior to the actual commencement of employment. See Key v Stuart Upton Pymble (unreported, IRC98/5503, 19 April 1999), Erduran and the Menzies Group of Companies t/as Allcorp Pty Limited [2003] NSWIRComm 175 and Doring v Spinout Pty Ltd t/as Five Way Fusion [2003] NSWIRComm 306.

48 These decisions have also made the point that Regulation 6(1)(c) does not require the probation period to be in writing. Nor does it require the approval or consent of the employee. Nevertheless, as a matter of prudent employee relations, it would be sensible to make it perfectly clear to an employee, preferably in writing, that a probation period is to apply.

49 I regard the following matters as being relevant to my conclusions as to whether the probation period was determined in advance: 1. It was the respondent's evidence that on 2 June, prior to commencing employment, the applicant had been shown various documents and discussed with Mrs Carver and Mrs Hawke his work contract, including the issue of probation. I accept the evidence of Mrs Carver and Mrs Hawke on this matter. 2. Mrs Carver gave uncontested evidence that the applicant had been given various employment and training forms on 2 June 2003. He returned three signed training forms on 9 June. Mrs Carver deposed that she had told the applicant on 9 June to bring all the papers back on 19 June when Mr Carver would be present. 3. The respondent had a particularly rigorous pre-employment procedure, including the requirement for employees to know and understand various safety and work procedures. It would seem highly implausible that this procedure would not have included the provision and discussion of the letter of appointment, which includes reference to probation. 4. The applicant signed the employment terms containing a three month probation period on the morning of 19 June 2003 - the day he commenced employment.

50 In light of these matters, I am satisfied that the applicant's probation was determined in advance thereby meeting the second requirement of the Regulation.

51 The real contest however, was the assertion by the applicant that Mr Carver had told him probation wouldn't apply to him and he could expect to be employed for a long period. I have some difficulty in accepting this evidence for the following reasons. Firstly, Mr Carver vigorously denied ever waiving the probation period and even if he had, it would have been in writing. Secondly, it would have been a simple exercise to have amended the applicant's letter of appointment by deleting any reference to probation. Thirdly, a month after commencing employment, the respondent confirmed in a letter requested by the applicant and his wife for the bank, that he was on three months probation from 26 June to 17 September 2003. There was no evidence that the applicant queried, let alone objected to this reference. Fourthly, the respondent had a policy of placing all new employees on probation. This was neither unusual nor oppressive. Mrs Hawke's evidence, which I accept, was that all new employees whether full time, part time or casual are on three months probation.

52 As I said earlier I believe the applicant unfortunately misunderstood the basis of his employment. A few extracts from his evidence serve to highlight his view. At p8 of transcript: MAIDLA: Q. When you signed the letter accepting your terms of employment which was the letter shown to you which is Exhibit B, on 19 June, did you understand all of the terms in that letter? A. Yes, I understood all the terms but it was still put to me that I was going to be full-time with training in the industry, which means to me it was a verbal agreement. and further at p9 of transcript: Q. You actually signed it to make a written agreement. A. I signed it because it was a full-time job and I was looking for a full time job in this industry. I was led to believe it was a full-time job through a verbal agreement.

53 There was no doubt that the applicant was told he was a full time employee and paid as such. However, the tenor of the applicant's evidence would lead me to conclude that he believed that probation did not apply to full time employment. This was a mistaken belief. I believe the applicant understood what probation meant, but genuinely believed it didn't apply to him. He felt that a permanent full time position was more secure than casual employment. In most respects this is true, but it does not follow that a probation period cannot apply when an employee commences full time permanent employment. Indeed, a probation period is more likely to be required if an employer engages a full time employee, rather than a casual.

54 For the aforementioned reasons, I make the following findings in this matter: 1. The applicant was on probation from the commencement of his employment on 19 June 2003 until his dismissal on 17 September 2003. 2. The respondent explained the nature of the contract of employment, including probation, prior to the commencement of employment. 3. The probation period was determined in advance. 4. The applicant received two documents, one of which he acknowledged and signed, which expressly state that he was on probation. 5. The respondent did not waive the probation period. 6. The applicant was dismissed during the probation period and before the expiry of three months.

55 In view of these findings, it must follow that the applicant was a class of employee excluded from the provisions of Pt 6 ch 2 of the Act and Regulation 6(1)(c).

56 The application must, therefore be dismissed for want of jurisdiction.

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