s.394 - Unfair dismissal

Application for an unfair dismissal remedy - minimum employment period - service broken by resignation - service continued on payslips so that leave accrual remained - Applicant reemployed on new contract - jurisdictional objection upheld - application dismissed.

• [1] On 3 January 2025, Mr Jackson Svanberg (Mr Svanberg / the Applicant) applied to the Fair Work Commission (the Commission) under s.394 of the Fair Work Act 2009 (Cth) (the Act) for an unfair dismissal remedy, alleging he was unfairly dismissed from his employment with Queensland Coastal Plumbing Pty Ltd (the Respondent).

• [2] The Respondent has raised a jurisdictional objection to the Application that the Applicant does not meet the minimum employment period prescribed by s.383 of the Act. On 14 February 2025, I issued a Notice of Listing and Directions to the parties regarding the jurisdictional objection. A jurisdictional hearing was held on 1 April 2025.

• [3] The Applicant appeared on his own behalf and Mr Andrew Papotto, Managing Director, appeared on behalf of the Respondent.

• [4] Mr Svanberg provided a witness statement dated 7 March 2025.[1] Mr Papotto,[2] Mr Steward Galea,[3] Construction Manager of the Respondent and Ms Jennifer Dobbie,[4] Accounts and Operations Manager of the Respondent, all provided witness statements on behalf of the Respondent dated 21 February 2025.

• [5] The Applicant commenced employment with the Respondent on 10 March 2023 in the position of Estimator pursuant to a written contract of employment dated 6 March 2023. This employment contract was for a full-time position on an ongoing basis based in Burleigh Heads, Queensland, where the Respondent's office was located. The Applicant's annual salary was $110,000 per annum. The Respondent submitted that it employed 25 employees at the time that the Applicant was dismissed.

• [6] At the outset, the Applicant was based in Melbourne and worked remotely. Pursuant to clause 28 of this employment contract, a Remote Working Agreement was in place that the Applicant would work 5 days on site in Queensland out of every 21 days and that the Respondent would pay for the Applicant's travel to and from Queensland for the 5-day period. This arrangement was in place for a maximum period of 12 weeks unless an extension was mutually agreed by the parties. Mr Papotto gave evidence that the Applicant verbally agreed to move up to Queensland within 3 months of the commencement of his employment.

• [7] However, the Applicant was unable to move to Queensland within that timeframe due to a member of his family suffering serious health issues. The parties agreed to a series of extensions. Mr Papotto gave evidence that the business was 'extremely busy' and that the Applicant's services were needed, so the Respondent agreed to a further remote working period. There is some dispute between the parties as to whether the remote working period was intended to be a permanent arrangement, however it is not necessary to delve further into this issue for the purposes of determining the jurisdictional objection.

• [8] On 3 June 2024, the Applicant resigned by an email to Mr Papotto which stated, relevantly, "Please accept this letter as a formal notification that I am resigning from my position as Estimator with [the Respondent]. My last day will be Friday, 14 June [2024]."

• [9] Mr Galea said Mr Svanberg told him he was leaving because he could get better pay elsewhere, and that Mr Svanberg later told him he had taken a job with another employer and was starting with them on 17 June 2024. Mr Svanberg denied starting work for another company or stating to any employees of the Respondent that he had started work for another company.

• [10] Mr Galea said he had contacted Mr Svanberg as he had a couple of handover questions and Mr Svanberg advised that he was happy to answer any questions, but he could only do so after hours when he finished working for his current employer as he had to be onsite.

• [11] Mr Galea said he had phone conversations with Mr Svanberg after the notice of resignation on 3 June 2024, and before it had effect on 14 June 2024 about trying to get Mr Svanberg to stay. Mr Galea said he sent Mr Svanberg a text message on Thursday 13 June 2024 saying, "Did you talk to Andrew." Mr Galea said Mr Svanberg replied "spoke briefly about variations but haven't asked him." Mr Galea said he replied, "Are you going to" and there was no reply from Mr Svanberg. Mr Galea said the message he sent to Mr Svanberg saying "Did you talk to Andrew" was because Mr Svanberg wanted to stay, but then he got offered better money.

• [12] In his own oral evidence Mr Svanberg said the conversation between himself and Mr Papotto about him having an increase in pay and continuing in employment happened on the evening of 13 June 2024, however later corrected this and said it happened on 14 June 2024. Mr Svanberg agreed that it was Mr Papotto who was the decision maker about this. While cross examining Mr Papotto before giving his evidence, Mr Svanberg asserted this conversation was on 10 June 2024.

• [13] The Respondent submitted that the resignation email operated to bring Mr Svanberg's employment contract to an end, and his subsequent employment from 21 June 2024 was subject to a new employment contract.

• [14] I asked Mr Papotto about paragraph 12 of his statement where he said that Mr Svanberg had said he was commencing his new role on 17 June 2024 however if they needed assistance, he would be able to assist but not until after 5pm when he finished with the other employer. Mr Papotto believed this conversation occurred on 14 June 2024, which was Mr Svanberg's last day of employment, but it could have been on Monday 17 June 2024.

• [15] Ms Dobbie gave evidence that on 3 June 2024, Mr Papotto directed her to advertise Mr Svanberg's position on Seek and that she did so. Further, Mr Papotto met with several potential candidates for the position and offered the role to one of the candidates he had interviewed. Mr Papotto said in the days leading up to this new prospective employee commencing, they advised the Respondent they could not take the role for personal reasons.

• [16] Mr Papotto said on Sunday 16 June 2024 at 7:39pm (two days after Mr Svanberg's written notice of the date of effect of resignation being 14 June 2024) Mr Svanberg sent Mr Papotto a text message. The text message reads as follows:

This decision has been a really difficult one, as leaving this company was never something I wanted to do, it was something I needed to do financially. It's been playing on my mind and really effecting me knowing I'm leaving a really good company and a job I have really enjoyed. I really appreciate you taking into consideration our families circumstances. I sincerely apologise for all the inconvenience that this has caused. I would really like to continue to grow with the company into the future."

• [17] In regard to this text, Mr Svanberg said he was expressing his gratitude to Mr Papotto after he had resigned and would be recommencing his employment. I put to Mr Svanberg that the text message appeared to be inconsistent with him having reached an agreement with Mr Papotto on 14 June 2024. He said he was a bit apprehensive about making an agreement on 14 June 2024, and he was stressed about how the relationship would work and was emotional about that, and that his daughter had been unwell, and the company had allowed him to work remotely.

• [18] Mr Papotto referred to the email from Mr Galea to the team of 21 June 2024 welcoming Mr Svanberg back into the team commencing that day and asking that he be made to feel welcome. Mr Papotto said this supported his evidence that Mr Svanberg had left and was now returning.

• [19] Mr Papotto said in his oral evidence the conversation he had with Mr Svanberg to be employed by the Respondent again was on Tuesday 18 June, or Wednesday 19 June 2024. He clarified his words in paragraph 13 of his statement, "About a week later..." was referring to the conversation on 18 or 19 June 2024. Mr Papotto's evidence is that the discussion was that Mr Svanberg would recommence on a new three-month contract on a higher salary of $120,000. Mr Papotto said this was a verbal discussion. In relation to the payslips indicating the employment continued, Mr Papotto said the pay week runs Friday to Friday and as the Applicant's employment ended on 14 June 2024, his entitlements would have been paid out on the following Friday 21 June 2024.

• [20] Mr Papotto said the entitlements were not paid out and he said he thought a conversation occurred between Mr Svanberg and Ms Dobbie around tax, so Mr Svanberg didn't have to pay tax on all his entitlements and he was happy to carry his entitlements through. Mr Papotto said this was at Mr Svanberg's initiative.

• [21] Mr Svanberg put to Mr Papotto they'd had a conversation about continuing to work for the Respondent around 10 June 2024. Mr Papotto emphatically denied that. Mr Svanberg put to Mr Papotto that there were multiple conversations that week and his salary was renegotiated to stay. Mr Papotto was consistent that the conversation occurred on 18 or 19 June 2024. Mr Papotto said he had employed someone else to replace Mr Svanberg and it was only when the new employee withdrew that he offered the position to Mr Svanberg again on 18 or 19 June 2024.

• [22] Mr Galea said on Wednesday 19 June 2024 he had a conversation with Mr Svanberg over the phone about Mr Svanberg wanting to come back after starting his new job. At 4:23pm that day he sent Mr Svanberg a message saying "How did you go", meaning did he talk to Mr Papotto. Mr Galea said he did not get a response from Mr Svanberg.

• [23] Mr Svanberg put to Mr Galea that he was still discussing with Mr Galea jobs concerning the Respondent between 17 June and 19 June 2024, and that Mr Svanberg was on leave. Mr Galea said from his understanding Mr Svanberg had ceased employment but wanted to come back.

• [24] Ms Dobbie said that on 18 June 2024, Mr Papotto advised her that he had telephoned Mr Svanberg and a discussion took place regarding Mr Svanberg being reengaged on a contract basis at $120,000 commencing from 21 June 2024.

• [25] Ms Dobbie said that the pay week runs from Friday to Thursday and given Mr Svanberg's last day was Friday 14 June 2024, on the following Friday 21 June 2024 she would normally prepare the last pay run for anyone finishing up. Ms Dobbie said that Friday 21 June 2024, was the same day that Mr Svanberg had recommenced employment. Ms Dobbie said she asked Mr Papotto what she was doing with Mr Svanberg's pay, and Ms Dobbie said Mr Papotto advised her that Mr Svanberg had requested not to get paid out the full entitlement because of the tax implications.

• [26] Ms Dobbie said she paid Mr Svanberg for the final day, which was 14 June 2024, and then she paid four days annual leave to Mr Svanberg. Ms Dobbie said she cautioned Mr Papotto about this, and said they should be paying Mr Svanberg out because his new employment contract starts on 21 June 2024 and it is at a different rate, but that she understood it was a "tax thing" and Mr Svanberg didn't want to pay, so she just did what she was told to do.

• [27] Mr Svanberg submitted that he never began working for a new employer and that shortly after he resigned, Mr Galea contacted him to ask him to reconsider his decision to resign. Mr Svanberg said he asked to be paid a higher salary going forward and the Respondent agreed. Mr Svanberg submitted that there was no break in his period of service. Mr Svanberg's payslip dated 21 June 2024 reflects that he took four days on annual leave between 14 June 2024 and 20 June 2024, consistent with his contention that he remained continuously employed in this period.

• [28] Mr Svanberg returned to work for the Respondent on 21 June 2024 on a higher salary of $120,000 per annum. The Respondent submitted that this was a new engagement on a 3-month fixed term basis. Mr Svanberg disputed this for the reasons outlined above and contended that his first employment contract remained on foot such that he continued to be an ongoing employee. Mr Svanberg did not sign a new employment contract with the Respondent. Mr Papotto gave evidence that a new verbal contract was entered into.

• [29] Mr Galea said he sent an email to all his construction team on Friday 21 June 2024 advising Mr Svanberg was back working for the Respondent and to make him feel welcome, and this email was provided as part of the evidence.

• [30] On 4 September 2024, Mr Svanberg again resigned from his employment by an email to Mr Galea stating "Please accept this letter as formal notification that I am resigning from my position as an Estimator with [the Respondent]. My last day will be Friday 20th September". It is agreed between the parties that in the intervening period Mr Svanberg negotiated an increased salary of $140,000 and there was not a break in his employment on account of this second resignation.

• [31] Mr Papotto gave evidence that a new verbal contract for a further 3-month fixed term arrangement was entered into at this time which was an extension of the oral agreement made on 18 or 19 June 2024.

• [32] On 14 December 2024, before the second 3-month period had elapsed, Mr Papotto terminated the Applicant's employment verbally during a meeting between himself and Mr Svanberg. Mr Svanberg gave evidence that he was told that his position was being made redundant and that the position of Estimator was no longer required. Mr Papotto gave evidence that he told the Applicant that his contract would not be renewed, consistent with the purported fixed-term arrangement. There is no dispute between the parties that the Applicant's effective dismissal date was 14 December 2024.

• [33] Sections 382 and 383 of the Act provide that a person can only make an unfair dismissal application if they had completed a minimum period of employment before dismissal. Section 383 of the Act defines the minimum employment period:

(a) if the employer is not a small business employer - 6 months ending at the earlier of the following times:

(i) the time when the person is given notice of the dismissal;

(b) if the employer is a small business employer - one year ending at that time.

• [34] A longer minimum employment period, 12 months rather than 6 months, applies to employees of small business employers. In Mr Svanberg's case, the Respondent is not a small business employer and therefore the 6-month minimum employment period applies.

• [35] I do not accept Mr Svanberg's evidence that a conversation occurred on 14 June 2024 with Mr Papotto where it was agreed he would continue in employment on a higher salary of $120,000. Throughout the proceedings Mr Svanberg was uncertain about this, initially putting to Mr Papotto that the conversation occurred on 10 June 2024, then while giving evidence himself saying it was on the evening of 13 June 2024, then changing his evidence to say it was on 14 June 2024, the last day of employment before the resignation took effect. Mr Papotto was consistent in his evidence that this conversation was no earlier than 18 June 2024, although at one point indicated it could have been 19 June 2024.

• [36] It is also reasonable to surmise from the evidence, including Mr Galea's evidence that the Respondent had wanted to retain Mr Svanberg as an employee. Mr Galea gave evidence that he exchanged text messages with Mr Svanberg on 13 June 2024 about whether he had approached Mr Papotto about the subject, and that Mr Svanberg was hoping to extract an offer of a higher salary from the Respondent before his resignation came into effect. This did not occur.

• [37] It was only after the person that the Respondent had intended to commence in the Applicant's role on 17 June 2024, advised that they could not proceed to take up the employment offer from the Respondent, that the conversation between Mr Papotto and Mr Svanberg occurred the following day on 18 June 2024 and the higher rate of salary was offered and accepted. Mr Papotto was consistent on that point.

• [38] The evidence of Ms Dobbie, that Mr Papotto raised the re-employment with her for the first time on 18 June 2024, tends to support Mr Papotto's version. Ms Dobbie gave evidence that Mr Papotto told her he had a conversation with Mr Svanberg, and that she was to re-employ Mr Svanberg from 21 June 2024.

• [39] It is also consistent with the conduct of Mr Svanberg in again tendering a resignation in September 2024 just prior to the expiry of the June contract, and then renegotiating a higher salary of $140,000 before the second resignation came into effect.

• [40] The evidence of Mr Galea also tends to support Mr Papotto's version, including the phone conversation on 19 June 2024 and text message sent to Mr Svanberg. I found each of Mr Papotto, Mr Galea and Ms Dobbie to be credible witnesses, and it was my impression they provided evidence and answered questions honestly. I am inclined to prefer their evidence where it conflicts with Mr Svanberg, as there was some inconsistency in his recollections, particularly in relation to the time of the conversation where he and Mr Papotto reached an agreement about his employment with the Respondent, and his new salary package.

• [41] If, as Mr Svanberg claims, a conversation occurred on 14 June 2024, where an agreement was reached between himself and Mr Papotto that he would remain an employee and his salary would be increased, this also sits uneasily with the text message that Mr Svanberg sent to Mr Papotto on the evening of 16 June 2024.

• [42] It seems most unlikely that had Mr Papotto reached an agreement with Mr Svanberg for him to remain an employee of the Respondent on an increased salary on 14 June 2024, as Mr Svanberg claimed, that Mr Galea and Ms Dobbie would not have been told by Mr Papotto until on or after 18 June 2024, and it appears reasonably clear from the evidence this is what occurred.

• [43] What flows from the conclusions above is that Mr Svanberg's resignation took effect on 14 June 2024, and he had a conversation with Mr Papotto on 18 June 2024 where it was agreed he would recommence employment on Friday 21 June 2024 at the higher rate of $120,000 for a further three months.

• [44] It is also reasonable to draw the inference from the evidence that Mr Svanberg's decision to resign was motivated by a desire to earn a higher income. I am inclined to the view on the evidence that Mr Svanberg did not commence employment with another employer on 17 June 2024. He directly rejected that proposition when it was put to him and there is insufficient evidence to lead me to conclude on balance that his answer is not truthful. I am inclined to the view however that he did say to Mr Galea that he was commencing new employment with another employer on a higher salary.

• [45] Mr Papotto said Mr Svanberg's entitlements were not paid out and he said he thought a conversation occurred between Mr Svanberg and Ms Dobbie around tax, so Mr Svanberg didn't have to pay tax on all his entitlements, and so he could carry his entitlements through. Mr Papotto said this was at Mr Svanberg's initiative. Mr Svanberg denied this.

• [46] Ms Dobbie explained that Mr Svanberg being paid on Friday 21 June 2024 (retrospectively) four days of annual leave for the period from 17 June to 20 June 2024, was to support this retention of leave entitlements. Ms Dobbie gave evidence that she had cautioned Mr Papotto against not paying out the entitlements and starting fresh on the new contract, however Mr Papotto agreed to Mr Svanberg's request to retain it.

• [47] I am satisfied from the evidence that Mr Svanberg and Mr Papotto agreed that Mr Svanberg would not be paid out his entitlements for matters of convenience to Mr Svanberg, rather than because they had reached an agreement that they would treat the employment relationship as being continuous despite the resignation. I am of the view that in the absence of an agreement to do so, the administrative action taken by Ms Dobbie at the direction of Mr Papotto to retrospectively pay 17 June to 20 June 2024 as annual leave and otherwise allow Mr Svanberg to continue to accrue entitlements, did not alter the fact that the initial employment relationship ended on 14 June 2024, and subsequently restarted anew on the basis of a new employment relationship based on a higher salary for a three month period.

• [48] The only question that remains for consideration is whether the decision of the Respondent not to process a final termination payment, and to record the payment of Mr Svanberg, (supported by his payslips) as if his continuity of employment had not been broken, results in his service being continuous and unbroken on account of his continuity being restored by the Respondent's actions after it had been broken.

• [49] Section 384(1) of the Act provides as follows:

(1) An employee's period of employment with an employer at a particular time is the period of continuous service the employee has completed with the employer at that time as an employee.

• [50] Section 22 of the Act outlines continuous service:

(1) A period of service by a national system employee with his or her national system employer is a period during which the employee is employed by the employer, but does not include any period (an excluded period) that does not count as service because of

(b) any period of unpaid leave or unpaid authorised absence, other than:

(i) a period of absence under Division 8 of Part 2-2 (which deals with community service leave); or

(ii) a period of stand down under Part 3-5, under an enterprise agreement that applies to the employee, or under the employee's contract of employment; or

(iii) a period of leave or absence of a kind prescribed by the regulations;

(c) any other period of a kind prescribed by the regulations.

(3) An excluded period does not break a national system employee's continuous service with his or her national system employer, but does not count towards the length of the employee's continuous service.

(3A) Regulations made for the purposes of paragraph (2)(c) may prescribe different kinds of periods for the purposes of different provisions of this Act (other than provisions to which subsection (4) applies). If they do so, subsection (3) applies accordingly.

Meaning for Divisions 4 and 5, and Subdivision A of Division 11, of Part 2-2

(4) For the purposes of Divisions 4 and 5, and Subdivision A of Division 11, of Part 2-2:

(a) a period of service by a national system employee with his or her national system employer is a period during which the employee is employed by the employer, but does not include:

(ii) any other period of a kind prescribed by the regulations; and

(b) a period referred to in subparagraph (a)(i) or (ii) does not break a national system employee's continuous service with his or her national system employer, but does not count towards the length of the employee's continuous service; and (c) subsections (1), (2) and (3) do not apply.

Note: Divisions 4 and 5, and Subdivision A of Division 11, of Part 2-2 deal, respectively, with requests for flexible working arrangements, parental leave and related entitlements, and notice of termination or payment in lieu of notice.

(4A) Regulations made for the purposes of subparagraph (4)(a)(ii) may prescribe different kinds of periods for the purposes of different provisions to which subsection (4) applies. If they do so, paragraph (4)(b) applies accordingly.

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.

Note: This subsection does not apply to a transfer of employment between non-associated entities, for the purpose of Division 6 of Part 2-2 (which deals with annual leave) or Subdivision B of Division 11 of Part 2-2 (which deals with redundancy pay), if the second employer decides not to recognise the employee's service with the first employer for the purpose of that Division or Subdivision (see subsections 91(1) and 122(1)).

(6) If the national system employee has already had the benefit of an entitlement the amount of which was calculated by reference to a period of service with the first employer, subsection (5) does not

result in that period of service with the first employer being counted again when calculating the employee's entitlements of that kind as an employee of the second employer.

Note: For example: (a) the accrued paid annual leave to which the employee is entitled as an employee of the second employer does not include any period of paid annual leave that the employee has already taken as an employee of the first employer; and (b) if an employee receives notice of termination or payment in lieu of notice in relation to a period of service with the first employer, that period of service is not counted again in calculating the amount of notice of termination, or payment in lieu, to which the employee is entitled as an employee of 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:

(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

(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.

• [51] An employee's period of employment with an employer is the period of continuous service the employee has completed with their employer as described in s.384(1) of the Act. Unlike the case for a transferring employee, the Act does not permit an employee whose employment relationship comes to an end, and is later re-employed by the same employer, to have their earlier period of service combined with their later period of service as part of their continuous service.[5]

• [52] Cases of this kind will turn on their own facts. The facts in this case support the conclusion that the Applicant's resignation took effect from the end of the working day on Friday 14 June 2024. His period of continuous service ended at the time the full-time permanent employment relationship was effectively ended by the resignation letter.

• [53] I am satisfied on the balance of probabilities that no employment relationship existed between Mr Svanberg and the Respondent from that time, and it was not until Tuesday 18 June 2024 that Mr Papotto and Mr Svanberg had a conversation and reached an agreement that Mr Svanberg would recommence employment with the Respondent on Friday 21 June 2024 on a higher salary.

• [54] None of the statutory provisions in s.22, which deem service to be continuous despite a break in the employment relationship, apply here. The employment relationship was broken by the resignation. Despite the retrospective decision after the employment relationship had ended to pay the Applicant annual leave for the intervening period before the restoration of the employment relationship, the fact remains the service up to and including 14 June 2024 does not count for the purposes of assessing whether the minimum employment period has been satisfied. Because it does not count, the Applicant does not satisfy the minimum employment period of six months and therefore falls outside the jurisdiction of the Commission to hear his application.

As I have concluded the application is not within the jurisdiction of the Commission, it is dismissed. An order will be issued separately and concurrently with this decision to that effect.

[5] Troy Harris v Laing O'Rourke Australia Construction Pty Ltd [2017] FWC 1204 paragraph [9]

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