Fair Work Act 2009

s.394 - Unfair dismissal

[1] Mr Carmelo Sapienza alleged the termination of his employment by Cash in Transit Pty Ltd trading as Secure Cash was unfair. In his application, he advised that he commenced employment on 22 November 2016 and his employment ended 18 July 2017.

[2] In the employer response, Cash in Transit stated that his employment commenced on 22 March 2017 and his employment ended on 18 July 2017. Further, it said it was a small business.

[3] Despite directions being issued neither party filed any material. On 9 October 2017 I caused to be sent to Cash in Transit an email which noted that no material had been filed to support its claim that it was a small business. In that email I set out the relevant provisions of the Act and drew Cash in Transit's attention to s.23 of the Fair Work Act 2009 which defines a small business and s.50AAA of the Corporations Law which defines associated entities. In accordance with Commission practice this email was also sent to Mr Sapienza.

[4] On 10 October 2017, Cash in Transit advised that it no longer pressed its objection based on it being a small business but maintained its objection that Mr Sapienza had not met the minimum employment period.

[5] On 11 October 2017, I caused to be sent to Mr Sapienza an email advising him of the qualifying period of six months for employees to bring an unfair dismissal application. I noted the conflict in the evidence and asked him to provide evidence that he commenced employment on 22 November 2017. I provided Mr Sapienza with an extract of s.22 of the Act and directed him to the Unfair Dismissal Bench book for further information. In accordance with Commission practice this email was also sent to Cash in Transit.

[6] The matter was listed for a telephone hearing on 13 October 2017.

[7] At that hearing, Mr Bacchus said that West Coast Cash Exports Pty Ltd was subcontracted to perform work for them in Western Australia. West Coast Cash was not an associated entity of Cash in Transit. West Coast Cash's owner was having financial difficulties and was intending leaving the country so Cash in Transit made a decision to perform the work itself. Employees of West Coast Cash were told that they could apply for work with Cash in Transit and Mr Sapienza made such an application. Mr Bacchus said that there was no transfer of any assets from West Coast Cash to Cash in Transit. They were not assigned any contracts from West Coast Cash.

[8] Mr Sapienza said he was not aware that that the companies were separate entities. At the hearing, when asked what name appeared on his pay slip he was not able to answer the question because he did not have his paperwork with him. He said that he was having difficulty getting paid on time by West Coast Cash and he was told by his supervisor that his pay would be coming out of head office in Adelaide. He said when he applied for work with Cash in Transit he filled in an induction form but was not required to complete all the paperwork as he only needed to complete his personal details including his banking details.

[9] As a result, I issued further directions to the parties to file material about whether there had been a transfer of business. I directed the parties to s.311(1) and (5) of the Act and also directed them to the decision of the Commission in Burdziejko v ERGT Australia Pty Ltd.[1]

[10] Mr Sapienza filed material in which he advised that he commenced employment with West Coast Cash Escorts Pty Ltd which was based in Perth but had a post office box in Adelaide. The information provided to him by West Coast Cash advised that clients are contracted to Cash in Transit Pty Ltd trading as Secure Cash and that Cash Logistics Pty Ltd is the agent appointed by Secure Cash to manage and allocate contractors for these clients and the clients had been allocated to West Coast Cash.

[11] Mr Sapienza said that he worked from home and received information about his daily schedule via email or text.

[12] Cash in Transit advised that there was no transfer of employment and that Mr Sapienza commenced new employment with them on 20 March 2017.

[13] Neither party addressed the issue of whether there was a transfer of business.

[14] As a consequence, I caused a further email to be sent to the parties. Attached to that email was a set of facts prepared by me as a result of the hearing. I asked the parties to advise if they did not agree with the facts and if they did, to provide evidence to support their facts. Neither party advised of any objection to the facts. I sought further submissions on whether there was a transfer of business. Again, no party filed any further submissions. I advised that if there were no disputed facts or further submissions I would make a decision based on the material before me.

Mr Sapienza commenced employment with West Coast Cash Escorts Pty Ltd on 23 November 2016.

West Coast Cash was contracted by Cash in Transit Pty Ltd to perform work for it in Western Australia.

Clients are contracted to Cash in Transit Pty Ltd trading as Secure Cash and Cash Logistics Pty Ltd is the agent appointed by Secure Cash to manage and allocate contractors for these clients and the clients had been allocated to West Coast Cash.

The owner of West Coast Cash decided that he no longer wished to perform work for Cash in Transit and as a consequence Cash in Transit decided to perform the work itself and directly engage employees to perform the work.

West Coast Cash and Cash in Transit have the same post office box address.

West Coast Cash and Cash in Transit are not associated entities.

Cash in Transit was not assigned any contracts of West Coast Cash.

Cash in Transit did not have the use of any assets of West Coast Cash after West Coast Cash ceased providing services to Cash in Transit.

Employees of West Coast Cash were advised that they could apply for work with Cash in Transit.

Mr Sapienza did apply for work but was not required to complete the full induction. He was only required to complete that part of the induction that provided his personal details including his banking details.

Mr Sapienza commenced employment with Cash in Transit on 20 March 2017.

[15] An employee is required to have served six months (one year if employed by a small business) employment to be protected from unfair dismissal.

[16] S.22 of the Act provides for service with a predecessor employer to count as service in certain circumstances:

"When service with one employer counts as service with another employer

(5) If there is a transfer of employment (see subsection (7)) in relation to a national system employee:

(a) any period of service of the employee with the first employer counts as service of the employee with the second employer; and

(b) the period between the termination of the employment with the first employer and the start of the employment with the second employer does not break the employee's continuous service with the second employer (taking account of the effect of paragraph (a)), but does not count towards the length of the employee's continuous service with the second employer.

(7) There is a transfer of employment of a national system employee from one national system employer (the first employer) to another national system employer (the second employer) if:

(a) the following conditions are satisfied:

(i) the employee becomes employed by the second employer not more than 3 months after the termination of the employee's employment with the first employer;

(ii) the first employer and the second employer are associated entities when the employee becomes employed by the second employer; or

• (b) the following conditions are satisfied:

(i) the employee is a transferring employee in relation to a transfer of business from the first employer to the second employer;

(ii) the first employer and the second employer are not associated entities when the employee becomes employed by the second employer.

Note: Paragraph (a) applies whether or not there is a transfer of business from the first employer to the second employer.

(a) is a transfer of employment between associated entities if paragraph (7)(a) applies; and

(b) is a transfer of employment between non-associated entities if paragraph (7)(b) applies."

[17] S.311 of the Act defines a transfer of business as follows:

Meanings of transfer of business, old employer, new employer and transferring work

(1) There is a transfer of business from an employer (the old employer) to another employer (the new employer) if the following requirements are satisfied:

• (a) the employment of an employee of the old employer has terminated;

• (b) within 3 months after the termination, the employee becomes employed by the new employer;

• (c) the work (the transferring work) the employee performs for the new employer is the same, or substantially the same, as the work the employee performed for the old employer;

• (d) there is a connection between the old employer and the new employer as described in any of subsections (3) to (6).

(2) An employee in relation to whom the requirements in paragraphs (1)(a), (b) and (c) are satisfied is a transferring employee in relation to the transfer of business.

Transfer of assets from old employer to new employer

(3) There is a connection between the old employer and the new employer if, in accordance with an arrangement between:

• (a) the old employer or an associated entity of the old employer; and

• (b) the new employer or an associated entity of the new employer;

the new employer, or the associated entity of the new employer, owns or has the beneficial use of some or all of the assets (whether tangible or intangible):

(c) that the old employer, or the associated entity of the old employer, owned or had the beneficial use of; and

(d) that relate to, or are used in connection with, the transferring work.

(4) There is a connection between the old employer and the new employer if the transferring work is performed by one or more transferring employees, as employees of the new employer, because the old employer, or an associated entity of the old employer, has outsourced the transferring work to the new employer or an associated entity of the new employer

New employer ceases to outsource work to old employer

(5) There is a connection between the old employer and the new employer if:

• (a) the transferring work had been performed by one or more transferring employees, as employees of the old employer, because the new employer, or an associated entity of the new employer, had outsourced the transferring work to the old employer or an associated entity of the old employer; and

• (b) the transferring work is performed by those transferring employees, as employees of the new employer, because the new employer, or the associated entity of the new employer, has ceased to outsource the work to the old employer or the associated entity of the old employer.

New employer is associated entity of old employer

(6) There is a connection between the old employer and the new employer if the new employer is an associated entity of the old employer when the transferring employee becomes employed by the new employer."

[18] I am satisfied that Mr Sapienza's employment with West Coast Cash (the old employer) was terminated and I am satisfied that Mr Sapienza was employed by Cash in Transit (the new employer) within three months of that transfer. I am satisfied that the work performed by Mr Sapienza for the new employer is the same or substantially the same as the work Mr Sapienza performed for West Coast Cash.

[19] The question that needs to be determined is whether there is a connection between West Coast Cash and Cash in Transit.

[20] I am satisfied that Cash in Transit does not own or has the beneficial use of some or all of the assets (whether tangible or intangible) of West Coast Cash.

[21] I am satisfied that West Coast Cash did not outsource the work to Cash in Transit.

[22] However I am satisfied that Cash in Transit had outsourced its work to West Coast Cash. This is supported by the agreed fact number 2 and the evidence of Mr Bacchus and the contract between Mr Sapienza and West Coast Cash. I am satisfied that the transferring work performed by Mr Sapienza as an employee of Cash in Transit occurred because Cash in Transit decided to cease outsourcing the work to West Coast Cash.

[23] There was no evidence that, prior to commencing employment with Cash in Transit, Mr Sapienza was provided with written advice that his service with West Coast Cash would not count as service with Cash in Transit.[2]

[24] I am therefore satisfied that Mr Sapienza's service with West Coast Cash counts a service with Cash in Transit and hence Mr Sapienza was employed for the minimum period of employment at the date of his dismissal. For these reasons the jurisdictional objection is dismissed and Mr Sapienza's application for an unfair dismissal remedy can be determined.

[1] [2015] FWC 2308

[2] S.384(2)(b)

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