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[2018] FWC 1398
General information, not legal advice.
Fair Work Commission
2018-03-29
Original judgment source is linked above.
s.394 - Unfair dismissal
Chase Commercial Pty Limited T/A Chase Commercial
Application for an unfair dismissal remedy - jurisdictional objection - high income threshold - whether covered by Real Estate Industry Award 2010.
[1] Ms Karen Muscat has applied under s.394 of the Fair Work Act 2009 (the Act) for an unfair dismissal remedy with respect to her dismissal by Chase Commercial Pty Limited T/A Chase Commercial (Chase).
[2] Ms Muscat commenced employment with Chase on 20 April 2009 and was dismissed on 3 November 2017. Chase is a commercial real estate agency and Ms Muscat's title at the time of her dismissal was Director of Asset Management.
[3] Chase filed a jurisdictional objection to the application on the basis that Ms Muscat is not a person protected from unfair dismissal by virtue of s.382(b) of the Act. It is contended by Chase that Ms Muscat's earnings were over the high income threshold and that she was not covered by an award or enterprise agreement.
[4] Directions were issued for the filing of evidence and submissions to determine the jurisdictional objection. The matter was listed for hearing on 2 March 2018 to deal with the question of whether Ms Muscat was covered by a modern award (s.382(b)(i)). At the hearing, Ms Muscat appeared on her own behalf. Chase was granted permission pursuant to s.596(2)(a) of the Act to represented by Mr R Ivessa, of Counsel.
When a person is protected from unfair dismissal
[5] Section 382 of the Act states:
'382 When a person is protected from unfair dismissal
A person is protected from unfair dismissal at a time if, at that time:
(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and
(ii) an enterprise agreement applies to the person in relation to the employment;
(iii) the sum of the person's annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold.'
[6] It is not in dispute and I accept that Ms Muscat has completed at least the minimum period of employment with Chase.
[7] It was not contended and I find that there was no enterprise agreement which applied to Ms Muscat in relation to her employment.
[8] Chase asserts two jurisdictional objections. The first is that Ms Muscat was not covered by a modern award during her employment. The second is that Ms Muscat's annual rate of earnings exceeded the high income threshold when the car allowance that was paid to her is taken into account.
[9] Ms Muscat asserted that she is covered by a modern award, the Real Estate Industry Award 2010 (the Award). Further, Ms Muscat asserted that if she is not found to be covered by the Award, her annual rate of earnings falls below the high income threshold and she is therefore a person protected from unfair dismissal.
[10] The first issue for determination by the Commission is whether Ms Muscat is covered by the Award. If it is found that Ms Muscat is covered by the Award, the Commission will not need to have any regard to Ms Muscat's earnings, and her application may proceed.
[11] Clause 4.1 of the Award describes its coverage as follows:
'4.1 This award covers employers in Australia engaged in the real estate industry in respect to their employees engaged in classifications in clause 14 - Minimum weekly wages to the exclusion of any other modern award.'
[12] The Award defines the 'real estate industry' as:
'real estate industry means the provisions of services associated with sales, acquisitions, leasing and/or management of residential, commercial, retail, industrial, recreational, hotel, retirement and any other leasehold or real property and/or businesses. Such services include:
[13] The Award provides for the following discrete classifications, which are further defined in Schedule B of the Award:
Property Sales Associate
Property Sales Representative
Property Sales Supervisor
Property Management Associate
Property Management Representative
Property Management Supervisor
Strata/Community Title Management Associate
Strata/Community Title Management Representative
Strata/Community Title Management Supervisor
[14] Ms Muscat contended that she performed the duties in the classification of Property Management Supervisor.
[15] On 9 February 2018 I instructed my associate to issue communication to the parties which drew their attention to the decision of Gostencnik DP in Kaufman v Jones Lang LaSalle (Vic) Pty Ltd T/A JLL[1]. The decision in Kaufman dealt with the issue of award coverage for a senior real estate employee with the title Regional Director, Capital Markets. The Deputy President found in that case that despite the applicant's significant earnings and senior title, he was covered by the Award as a Property Sales Representative.
[16] The parties were required to provide submissions and evidence in light of the single member decision in Kaufman, and to give consideration to whether Ms Muscat could be covered by the Award under the Property Management Supervisor classification.
[17] The Property Management Supervisor classification is defined in Schedule B of the Award as follows:
(a) Role definition
(i) A Property Management Supervisor is responsible, on behalf of the employer, for supervising Property Management Representatives and the overall supervision of a rent roll or portfolio of strata title managements.
(ii) The role involves significant initiative, judgment, decision making and problem solving in relation to landlord and tenant or strata title management matters.
(iii) It may also involve contribution towards the development of departmental business plans or strategies and budgets, and/or having the accountability and responsibility for self and others in achieving the outcomes.
(b) Indicative tasks
The indicative tasks for a Property Management Supervisor are as follows:
(i) Provide leadership in the workplace;
(ii) Supervise and/or manage work team(s);
(iii) Ensure compliance with the various obligations imposed under relevant real estate law;
(iv) Implement and/or supervise quality customer service;
(v) Develop and/or supervise operational plans;
(vi) Manage personal work priorities and professional development of self and others in the work team(s);
(vii) Facilitate change and innovation;
(viii) Resolve customer complaints;
(ix) Develop and implement customer service strategies; and
(x) Supervise a portfolio of rental properties.'
[18] Chase called Mr Rodney Brown, Director, to give evidence in support of its jurisdictional objection. Ms Muscat gave evidence on her own behalf.
[19] Mr Brown's evidence is that until recently Chase had two directors, Mr Brown and Mr Dominic Condon. Neither Mr Brown nor Mr Condon had experience in property management; their skills were in property sales. The position of Director of Asset Management was created and advertised for a management-level individual to take on the responsibility of running and managing the property management division of the company.
[20] Mr Brown's evidence is that Chase is principally involved in the business of sales and leasing. Chase desired appropriate 'executive staff' to provide for dynamic growth.
[21] Ms Muscat was appointed in 2009 on a starting salary of $80,000 inclusive of superannuation, together with the potential to earn a percentage of management fees. She would be entitled to use of a company vehicle during work hours, a mobile phone and plan, together with a laptop.
[22] The summary of Mr Brown's evidence relevant to the duties performed by Ms Muscat in recent years is as follows:
(a) Ms Muscat managed and oversaw all employees in the Asset Management Division;
(b) Ms Muscat was responsible for meeting revenue profits and arrears targets. Chase had sophisticated property management software, however Ms Muscat would provide a monthly management report that she created as opposed to using the software. The budgets were estimated figures based on current and forecast managements. Mr Brown and Mr Condon relied on these composed reports;
(c) Ms Muscat would instruct the receptionist to prepare PAMD forms. These forms are appointment of agent forms required under the Property Agents and Motor Dealers Act 2000;
(d) Ms Muscat updated the property management software knows as REST. Ordinarily a Property Management Representative or a Property Management Associate would be responsible for all work relating to the software. The software controls the trust and accounts of the clients. The exception to this is that the bank reconciliation is done daily and typically by the accountant;
(e) Ms Muscat managed and supervised Mr Robert Palm, Accountant in relation to property management, which took up a large part of Mr Palm's duties. Ms Muscat would review and make corrections to accounting receipting and entries. Mr Palm was instructed by Ms Muscat to make such changes. Further, Mr Palm followed Ms Muscat's instructions to provide a letter for taxation purposes stating that the motor vehicle provided to her was predominantly used for business use. Mr Brown contended that Mr Palm did not consult with him, nor Mr Condon before providing the letter to Ms Muscat;
(f) Ms Muscat and Ms Gemma Handley, Assistant Property Manager both:
(i) Negotiated budgets for some of Chase's clients;
(ii) Created their own priorities and tasks; and
(iii) Managed and supervised other property management personnel.
[23] Mr Brown's evidence is that Ms Handley organised all repairs and maintenance with the properties, entered all creditor invoices into the software system, and kept a key register. Ms Muscat did not perform these duties.
[24] Ms Muscat instructed staff they were not to take telephone calls for tenant issues, and all complaints were to be sent to a specific email address. Ms Muscat had access to the email account, but would not personally reply, and instead instructed Ms Handley to do so if necessary.
[25] Ms Muscat had access to the trust account which held in excess of $1.5 million via the highest security level of REST. Further, Ms Muscat had access to the security token of a Westpac bank account, and had taken on the accountant's role for a short period, despite not being comfortable doing the banking.
[26] Mr Brown stated that Ms Muscat had complete access to the office and was the person responsible for opening the office. Ms Muscat's hours of work were between 7:00am to 3:00pm, which were set by her and agreed by the Directors to accommodate her family life. Ms Muscat was not asked to account for her whereabouts during the working day.
[27] Ms Muscat requested and was granted permission to work from home one day per month, with the day to be decided by Ms Muscat. Against company policy, Ms Muscat announced that she would be away on leave at the same time as Ms Handley. Mr Brown and Mr Condon chose not to deny Ms Muscat's leave.
[28] Ms Muscat attended interviews and was involved in checking and writing position descriptions for property management employees. Up to five Property Management Assistants were employed reporting to Ms Muscat over her eight years with the company, and Ms Muscat attended at least one interview when each of those staff members was considered for employment.
[29] Each year Ms Muscat requested a yearly salary review, and each year she 'insisted that the minimum CPI was applicable'. Each year additional salary and benefits were granted 'at her request'.
[30] Mr Brown stated that the setting of targets and revenues was completely in the hands of Ms Muscat and was run independently. Ms Muscat produced monthly reports which were the primary mode of communication between the property management division of Chase and the Directors. Ms Muscat negotiated lease renewals and set the management fees that Chase would charge.
[31] Mr Brown's evidence is that Ms Muscat was managing a commercial portfolio of up to $50,000 per month. A residential Property Management Supervisor might manage an average rent roll of only $8,000 per month. Her portfolio included shopping centres in liquidation and she was paid a salary commensurate with her responsibilities. Mr Brown contended that the Award rate of pay for a Property Management Supervisor was only $46,872.80.
[32] Mr Brown stated that Ms Muscat determined that a facilities manager was required in the business. She organised for an email address relevant to this position, and 'employed' her husband to the role. When the position was determined as no longer required, Ms Muscat dissolved the role.
[33] Ms Muscat organised staff Christmas parties and Melbourne Cup functions for the staff. Ms Muscat was treated as a Director of Asset Management and given 'complete trust and confidence by the Directors on a level not afforded to any other personnel'.
[34] In cross-examination, Mr Brown agreed that Ms Muscat set the revenue budgets for the property management side of the business, but not other matters such as superannuation to be paid to employees or payroll or the like.[2] Mr Brown stated that Ms Muscat made the decisions of how much the management fees would be on the majority of the properties, and she would 'never advise myself or the directors of the company.'[3]
[35] The majority of leads to manage commercial property came from Chase's sales team, not from clients generated by Ms Muscat. Mr Brown's evidence is that 95% of the time Ms Muscat would set the management fee, and the other 5%, Mr Brown would. Ms Muscat rarely came to Mr Brown to enquire what he thought the management fee should be as she had already made the decision.
[36] The following questions were put by the Commission and answered by Mr Brown:[4]
'Did she have a range in which she could work? -Yes, the industry norm is anywhere between three and 8 per cent, your Worship.
Did you at any time say to her that you were aggrieved that she had agreed to a lower figure? -There was a number of figures which I - to this very day I'm astonished as to how low they were, and again there was no approval seeked(sic).
Did you admonish her on those occasions where you discovered that it was lower than your expectations? -Yes, a number of times we'd have those discussions.
No, I'm asking you some questions so you'll have another opportunity following my questions here. So do you have an example where you approached Ms Muscat and said "Why did you agree to this figure? It should be this figure"? -Yes, one would have been [name] which I think the discount, the significant discount was two below the industry standard, two point something per cent.
And what did you say to her? -Which I was quite astonished as to why and who made that decision, because it wasn't me, as to why that was so low.
And what did you say to Ms Muscat? -"Why was it so low?"
And what did she say in return? -What did you say in return?
No, I'm asking you the question now, Mr Brown? -"Because that's what I negotiated" or "That's what it was negotiated", because I had actually never got involved with the client.
So she said "That's what I've negotiated"? -Correct.
And what did you say to her? -In - what do you mean, in what respect?
You've asked her "Why is it so low?" She said "That's what I've negotiated"? -That's right.
What did you then say next? -Well, probably along the lines of "Well, if that's what's been negotiated well then that would have to be fine".
All right, so how many times did you challenge Ms Muscat do you think as to your dissatisfaction at the low levels of - - -? -Conversations between my director were probably on a number of occasions, and I couldn't recall exactly how many occasions I had those discussions with Karen.
I need you to estimate how many times did you have a conversation - - -? -Less than five.
Right, and was she disciplined in relation to that? -Karen exercised no discipline in my business.
Did you discipline her to say that she needed to seek your approval before she could put that to writing? -I don't recall.
And how were the terms reduced to writing? I imagine they would have been in a lease or something like that or - - -? -In an appointment to act form.
Right, so what responsibility did Ms Muscat have to enter the agreed property management rate? -Full responsibility.
You didn't withdraw that at any time? -Never. Never. Never.'
[37] Mr Brown gave evidence that he agreed that Ms Muscat did all of the indicative tasks as described in the Award. He was asked by the Commission what else Ms Muscat did in addition to those tasks that caused him to believe that she was not an Award covered employee. He answered as follows:[5]
'In addition to that I would say when an employee who was a director of a company has access to my private bank account and that trust is entrusted in that person, that is by far a normal situation that was an employee. For that very reason Karen is not just a simple property manager. There was - - -
So you gave Ms Muscat access to your private bank account, did you? -The company trust account, the Westpac bank account which carries anywhere between one and one and a half million dollars, with no limitation on withdrawal. So that's the level of trust and the accountability which she was given. Now when you're paid $180,000 a year and that's one of the roles, I can tell you, your Worship, you're not a simple property industry when the industry norm of my current asset manager, who has significant more experience than Karen, is on a hundred thousand dollars a year and very grateful for her role and job.
All right, is there anything else in addition to those indicative tasks that I read to you? -Not in particular, no.
So do you say that Ms Muscat primarily did the things she was required to do that meets the definition under the award, but is it only in addition to what she was paid an her access to the trust account that would lead the Commission to conclude that she's not an award employee? -Yes.'
[38] Further, Mr Brown indicated that he considered the 'cutoff' for a Property Manager Supervisor to be covered by the Award to be the "level of trust and belief you have in that person's competencies when you allow them to run the entire division."[6] In re-examination Mr Brown agreed that he also considered Ms Muscat's autonomy in negotiating management fees to be a duty that was performed outside of Award coverage.[7]
[39] Ms Muscat's evidence is that whilst her position was titled 'Director of Asset Management', her roles and responsibilities were that of a 'Property Management Supervisor' classification description of the Award_._
[40] Ms Muscat stated that her duties as Director of Asset Management included:
(a) Manage and oversee all employees in the asset management division. Ms Handley held the role of Assistant Property Manager, and she was employed to assist Ms Muscat;
(b) Responsible for meeting all revenue, profit and arrears targets set. This involved chasing tenants to pay rent and organising lease renewals;
(c) Having PAMD forms completed;
(d) Updating REST to ensure rent reviews were updated and new tenants' details were put into the accounting package. The accountant performed this work, however Ms Muscat instructed the updates;
(e) Advising tenants and owners of upcoming lease expiry, and organising work orders for contractors for maintenance and repair of property;
(f) Liaison with legal representatives of owners, together with accountants;
(g) Site inspections, including responding to owners and tenants with inquiries regarding premises;
(h) Budgeting to allow owners to understand their expenses;
(i) Conducting rent reviews;
(j) Assisting tenant/owner issues and resolving complaints regarding premises;
(k) Overseeing the key register;
(l) Overseeing payments of invoices;
(m) Managing priorities and tasks for herself and Ms Handley to achieve deadlines, critical dates and tasks;
(n) Managing and supervising Ms Handley and overseeing accounts work on updating REST;
(o) Provide instructions to leasing and sales agents while they are working on the property management portfolio;
(p) Monthly management meetings with the Directors to provide updates on property management issues.
[41] The property management team comprising of Ms Muscat and Ms Handley managed a portfolio of approximately 160 leases. The team also utilised an employed part-time accountant who split his time with the property management team and the other parts of the business.
[42] Ms Muscat stated that as part of her role she renegotiated leases with existing tenants, arranged assignments of leases once a property became vacant, arranged termination of leases or exercise of options under direct instructions of the lessor as part of managing the property.
[43] Ms Muscat's evidence is that she never had access to bank reconciliations nor did she make payment of pays as this was carried out by the office accountant. When the business was in between accountants for a period of approximately four months after one accountant resigned, Ms Muscat was asked to pay contractors and run the end of month process for the property management division. At this time she had access to the trust account.
[44] Ms Muscat's evidence was that she was not comfortable having access to the trust account, however Mr Brown or Mr Condon said to her words to the effect, "We've got no one else to do it."[8] When a new accountant was employed, Ms Muscat no longer had to perform these duties.
[45] Ms Muscat did not pay staff during this time as this was done by Mr Condon's wife, Mrs Christina Condon.
[46] Ms Muscat did not have access to HR files as they were kept in a locked cabinet which only the office manager and the accountant had access to. Ms Muscat accepted that she attended interviews, however was only involved with them if there was a potential property management candidate.
[47] Ms Muscat stated that the Directors were the ones who contacted the various recruitment agencies to recruit for personnel, and it was them who placed advertisements on Seek. Ms Muscat did not have any part in the salary negotiation of Ms Handley or other Assistant Property Managers who were employed before Ms Handley. Ms Muscat was not part of any salary review of Ms Handley; she was simply asked her views on the performance of the employee. Ms Muscat was never involved in interviews for sales employees.
[48] In questioning from the Commission, Ms Muscat's evidence is that some years ago an employee in the property management team was dismissed by Chase. Ms Muscat is unsure if the employee was dismissed for poor performance or for redundancy. She was asked to attend the boardroom shortly before the dismissal took effect and she was informed by Mr Brown and Mr Condon of the company's decision to terminate the other employee.
[49] Relevant to Ms Muscat's desire to work from home on occasions, her evidence is that she requested it and was granted permission by Mr Brown to work from home. Having commercial tenancies to administer, she was often contacted out of ordinary business hours from restaurants, for example, requiring matters to be attended to.
[50] Ms Muscat's evidence is that at one point in time all staff had a key to the office. When Mrs Felicity Brown returned to the workplace after a period of time away, the keys were returned. Ms Muscat was reissued with a key as she was often the first person in the office at approximately 7.00am.
[51] In evidence addressing the issue of Ms Muscat's husband being employed as a facilities manager, Ms Muscat stated that at no time did that occur. In approximately 2010 Chase elected to tender for a property which would require a facilities manager. Ms Muscat suggested that her husband's details should be inserted into the tender (with his knowledge), to allow Chase to secure the work, which it did. Ms Muscat's husband held an electrical contracting license, but was happily employed elsewhere. Ms Ashley Shepherd was working at Chase and she then started performing some of the facilities manager role within her own duties. Ms Shepherd successfully fulfilled the role for a period of time.
[52] In cross-examination Ms Muscat was asked if she attended board meetings with the directors of the company. Ms Muscat stated that she was never informed that meetings with Mr Brown and Mr Condon were board meetings. Ms Muscat considered that she was attending management meetings called by Mr Brown and Mr Condon, to which other people sometimes attended, such as franchise managers.
[53] In cross-examination it was put to Ms Muscat that she had decided to hire her adult daughter to work at Chase. Ms Muscat denied making that decision, and stated that when the business needed a relief receptionist, she sent an email to both Mr Brown and Mr Condon suggesting that her daughter, attending university might be suitable. Mr Brown and Mr Condon made the decision to approve her employment.
[54] Ms Muscat was asked if it was her decision to move her daughter into the property management department, to which she answered that it wasn't ever a decision. Ms Muscat had mentioned to Mr Brown that Ms Handley was looking for more assistance with property inspections, and Ms Muscat suggested it to Mr Brown, and from there it followed.
[55] It was put to Ms Muscat in cross-examination that she was a valued employee and a member of the senior management team. Ms Muscat replied:[9]
"There was no team. Like I said I didn't - they used to have meetings with all the other directors of the franchisee that would do budget planning, they'd go and have golf days and stuff. I was never party to any of that. I was an employee. I was a property manager with a fancy title so I could mix with other owners of high calibre. That was all it was."
[56] In oral closing submissions, Chase urged the Commission to differentiate the decision in Kaufman to the matters before the Commission involving Ms Muscat. It was pressed that in Kaufman, the employee was in a hierarchy of a large corporation, where he had above him a Victorian management committee, an Australian executive committee and a board of directors. There were 50 other employees in Mr Kaufman's state with the same or a similar job title.
[57] Mr Kaufman did not have the capacity to access the company's financial information or bank accounts, nor did he set budgets. He had no staff reporting to him other than an assistant.
[58] It was contended that Ms Muscat did not have anybody above her other than the directors of the business, and all staff in her department reported to her. She was the only employee in the business that held the title of director, and she had access to the company's bank account.
[59] It was conceded by Chase that Ms Muscat meets many of the indicative tasks contained in the Award classification, but the Commission was urged not to place too much weight on that fact. It was put that the autonomy with which Ms Muscat could operate her department and negotiate and set management fees meant that she was not covered by the Award. It was submitted that a Property Management Supervisor covered by the Award would not negotiate the fees for the properties that they supervise the management of; that is an executive level responsibility akin to that of a business partner.
[60] The following was put by the Commission to Mr Ivessa in closing submissions:[10]
'THE COMMISSIONER: So where the Deputy President said at paragraph 45 that the principal purpose of Mr Kaufman was his position was to sell real estate, should the Commission find that the principal purpose of Ms Muscat's employment was not to manage properties?
MR IVESSA: The classification that she's contending for is the supervising of managing properties and, yes, I am contending that the - or the respondent contends that it should be the direction of a department is her principal purpose. It's neither managing properties nor supervising people managing properties but rather the direction of an entire department, including tasks that would not fit within somebody coming under the award.'
[61] Ms Muscat submitted that the principal purpose of her employment was to manage the property portfolio. When she was asked to access the trust account it was because Chase needed her to do it, and it was for a very short time.
[62] When Ms Muscat first commenced with Chase she was the sole employee in the Asset Management Department, and performed all of the work required across the properties managed. When the Assistant Property Manager was on leave, Ms Muscat again performed all duties.
[63] A modern award covers an employee in relation to their employment if the award is expressed to cover the employee.[11] A modern award must include a coverage term and that term must be expressed to cover specified employers and specified employees of employers covered by the award.[12] A coverage term in a modern award must describe employees that are covered by the award by specifying their inclusion in a specified class or classes.[13] A class of employees may be described by reference to a particular industry or part of an industry, or particular kinds of work.[14]
[64] The question of whether Ms Muscat was covered by the Award is to be determined by reference to the principal purpose test, as articulated in the Full Bench decision of the Australian Industrial Relations Commission in R Brand v APIR Systems Limited.[15] That decision, in turn, cited the decision of the Full Bench of the Australian Industrial Relations Commission in Carpenter v Corona Manufacturing Pty Ltd,[16] which stated relevantly as follows:
'In our view, in determining whether or not a particular award applies to identified employment, more is required than a mere quantitative assessment of the time spent in carrying out various duties. An examination must be made of the nature of the work and the circumstances in which the employee is employed to do the work with a view to ascertaining the principal purpose for which the employee is employed.'
[65] Thus in determining whether the Award covered Ms Muscat at the time of her dismissal, an examination is necessary of the nature of the work undertaken and the circumstances in which Ms Muscat was employed to do the work in order to ascertain the principal purpose for which she was employed and then assess whether Ms Muscat in that employment fell within the coverage provisions of the Award.
[66] Ms Muscat was originally employed due to Chase not having any or requisite experience in property management. Chase appears to have been successful in sales, but on Mr Brown's evidence, the property management revenue generated in the time that Ms Muscat was employed made up a very large portion of the total revenue of the business. It was a very important part of the business.
[67] On Ms Muscat's evidence, she was the only person in the Asset Management Department when she agreed to work for Chase, and naturally, she was liaising with property owners and tenants, together with owners' lawyers and accountants, and contractors for required property maintenance.
[68] At some point Chase employed a further person in the team who became an Assistant Property Manager. It is not unusual to expect that the person employed in that role would perform duties such as preparing lease documents, liaising with tenants and contractors, and payment of invoices. The employment of the Assistant Property Manager would allow Ms Muscat to perform higher functions.
[69] On Mr Brown's evidence, Ms Muscat generated a small percentage of new business, as most of the new clients came to Chase as a result of introductions from the sales team. For the majority of the properties managed by Chase, Ms Muscat was not required to convert potential clients to become clients; this was done by others.
[70] What then was Ms Muscat doing? It is clear on the evidence that Ms Muscat was leading the department that managed properties. She and Ms Handley (the latest Assistant Property Manager) would together ensure that Chase had authority to represent the owner of the property, by having PAMD forms completed. It does not matter who completed the forms, whether it was Ms Handley or the receptionist. Ms Muscat had responsibility to ensure that under the relevant legislation, Chase could represent the property owner and commit the owner to leases with tenants.
[71] Having regard to the classification definition within the Award, I am satisfied as follows (the Award definition in italics):
(a) Role definition
(i) A Property Management Supervisor is responsible, on behalf of the employer, for supervising Property Management Representatives and the overall supervision of a rent roll or portfolio of strata title managements.
(a)(i)(a) Ms Muscat was employed by Chase to be responsible for supervising other property management employees, and she was responsible for the overall supervision of Chase's rent roll;
(ii) The role involves significant initiative, judgment, decision making and problem solving in relation to landlord and tenant or strata title management matters.
(a)(ii)(a) Ms Muscat was entrusted with authority to use significant initiative, judgment, decision making and problem solving in relation to landlord and tenant matters. She was in charge of the department, and with her recognised experience, she did not need to go to the Directors for many matters at all. She was left by the Directors to largely 'run her own show', and she reported monthly to the Directors the results of the month;
(iii) It may also involve contribution towards the development of departmental business plans or strategies and budgets, and/or having the accountability and responsibility for self and others in achieving the outcomes.
(a)(iii)(a) Whilst Ms Muscat had responsibility towards the property management department budget, it was only in relation to revenue and outgoings of property owners. Ms Muscat did not have responsibility relevant to the wages paid to others within the department, nor did she have any authority to hire or fire. She had no responsibilities relevant to the department's budget in terms of all expenses including wages, superannuation, workers compensation, the cost of REST (for example) and other subscriptions.
(a)(iii)(b) Ms Muscat did have responsibility to ensure she and Ms Handley endeavoured to achieve the revenue budgets set by Ms Muscat.
The indicative tasks for a Property Management Supervisor are as follows:
(b)(i)(a) Ms Muscat provided leadership in the workplace, particularly to Ms Handley and other Assistant Property Managers employed prior to Ms Handley's commencement with Chase;
(b)(ii)(a) Ms Muscat supervised and managed a small work team of one employee and had access and some supervision of the accountant;
(iii) Ensure compliance with the various obligations imposed under relevant real estate law;
(b)(iii)(a) Ms Muscat was entrusted by Chase to ensure Chase complied with the various obligations imposed under relevant real estate law;
(iv) Implement and/or supervise quality customer service;
(b)(iv)(a) There was no evidence led on this issue;
(v) Develop and/or supervise operational plans;
(b)(v)(a) Ms Muscat developed budgets for revenue for the department, if that can be taken to be akin to an operational plan. There was no evidence before the Commission that any operational plans were in place;
(vi) Manage personal work priorities and professional development of self and others in the work team(s);
(b)(vi)(a) Ms Muscat managed personal work priorities of herself and her team. There was no evidence of any professional development undertaken or required to have been undertaken;
(b)(vii)(a) There was no evidence led on this issue;
(b)(viii)(a) Ms Muscat supervised the resolution of customer complaints. Where she did not do so personally, she implemented a system where tenant concerns were to be dealt with by email, not by telephone. There is nothing exceptional about this course of action and to allow for a record of the inquiry;
(ix) Develop and implement customer service strategies; and
(b)(ix)(a) One of the strategies developed by Ms Muscat was the implementation of the tenant inquiry system above;
(x) Supervise a portfolio of rental properties.
(b)(x)(a) Ms Muscat supervised a portfolio of rental properties.
[72] For the large majority of owners, Ms Muscat determined the management fee to apply. The range was typically between 3% and 8%, and Ms Muscat used her judgment to determine the rate. On only around five occasions Mr Brown expressed his dissatisfaction to Ms Muscat at the low rate set by her. She was not formally disciplined by him on any occasion, and he ultimately accepted the rates she had set whether he was pleased with them or not. He acquiesced full responsibility to Ms Muscat to set the management fee rates.
[73] I do not consider that the granting of authority to Ms Muscat to determine the management fee to be applied to properties at her discretion to be so far outside of the principal purpose for which she was employed. On the evidence before the Commission, it suited Chase to allow this authority to Ms Muscat, and year-on-year she increased the rent roll of the commercial property management.
[74] Whilst Mr Brown was indignant during the hearing as to the level of authority that had been bestowed upon Ms Muscat, and how he considered that authority had led to the destruction of part of the business, it is plain on the evidence that the arrangement suited Mr Brown. He did little or nothing during Ms Muscat's employment to minimise her authority to set management fees with property owners. Chase gave to Ms Muscat this responsibility.
[75] It is disingenuous to claim that this specific responsibility meant that for all of Ms Muscat's other duties she might be considered an Award employee, but for the level of authority to set management fees, she falls outside of the Award coverage. I find that the granting of the responsibility to Ms Muscat to set management fees is appropriately covered by the second part of the role definition as follows:
'(ii) The role involves significant initiative, judgment, decision making and problem solving in relation to landlord and tenant or strata title management matters.'
[76] I determine that Ms Muscat was granted a general authority to make decisions in relation to the setting of management fees, which in doing so would generate revenue for the department, and ultimately for Chase. I determine that this is appropriately applied as 'significant initiative, judgment, decision making in relation to landlord matters'.
[77] I do not accept that the direction some four years ago for a period of approximately four months to Ms Muscat to take responsibility for the trust account to equate to Ms Muscat performing a role that is not covered by the Award. The direction was resisted by Ms Muscat, and she was ultimately relieved of that responsibility when an accountant was employed by Chase. Despite Mr Brown's protestations that Ms Muscat had access to 'his personal bank account', she did not. The trust account is the comings and goings of the money receipted between Chase and the tenants and property owners.
[78] I am not satisfied that Ms Muscat's apparent autonomy with her working hours and where she performed her work means that she is not an employee covered by the Award. It is not unexpected that when looking after approximately 160 commercial properties, there would be some time spent visiting those properties or owners elsewhere. I accept Ms Muscat's evidence that commercial tenants might need to make contact with the real estate agency outside of normal business hours, and on the information currently before the Commission, there was a suitable arrangement between Chase and Ms Muscat to allow her to perform her work wherever necessary, within reason, so long as she was able to be contacted by telephone. I have also had regard to the fact that Ms Muscat was employed for approximately nine years, and if this had been an issue between Chase and Ms Muscat, it would have been appropriately addressed.
[79] Despite Mr Brown's evidence that Ms Muscat dictated her annual salary increases, where she worked and what she did, having regard to the witnesses, I am satisfied that Mr Brown had relevant authority over Ms Muscat and would not have been adverse to issuing to Ms Muscat lawful directions to follow. Having regard to the manner in which Mr Brown gave evidence during the hearing, I do not accept that Mr Brown would have been submissive to Ms Muscat.
[80] Relevant to the evidence of the respondent regarding the employment of Ms Muscat's husband and daughter, I determine that at no time was Ms Muscat's husband employed, and I prefer her evidence over the respondent's on this issue. I am satisfied that while Ms Muscat suggested to the Directors her daughter might make a suitable employee, it was ultimately the decision of the Directors that her daughter be employed. As to the work performed by Ms Muscat's daughter, I determine that the Directors acquiesced the supervision of Ms Muscat's daughter to relevant people within the business, including the receptionist, Ms Muscat and Ms Handley.
[81] I accept Ms Muscat's evidence that she did not have authority to employer or terminate employees, nor did she have any responsibility to set wages for the employees she supervised. Her only involvement was to inform the Directors if she considered the prospective employees would, in her view, be suitable. Further, she gave feedback on performance to the Directors, to allow the Directors to make determinations as to any salary increases they wished to make.
[82] Relevant to Ms Muscat's title as Director of Asset Management, I am not persuaded that the title of 'Director' caused Ms Muscat to be elevated beyond the status of an Award employee. It was a title granted to her when the role was first created, when she was earning a base (inclusive of salary) of $80,000. The nomenclature used was chosen by Chase, in what one would expect to be a desire to promote or add legitimacy to Chase's ability to manage commercial property. Ms Muscat had for the most part of her employment only one employee under her supervision.
[83] I am not persuaded that because Ms Muscat reported directly to the Directors that this distinguishes the matter presently before the Commission from the decision in Kaufman. Chase is a small real estate agency. A single Property Management Representative might report directly to directors in an agency where there is no Property Management Supervisor. It would not correlate that a Property Management Representative without a manager would be award-free.
[84] I conclude that the principal purpose of Ms Muscat's position was to lead the property management team within Chase, and to increase the revenue from the properties managed by Ms Muscat and later, her team.
[85] I am satisfied the principal purpose of the role at the time of her dismissal falls squarely within the role of Property Manager Supervisor and the duties that she undertook to execute the primary purpose falls comfortably within the indicative tasks for a Property Management Supervisor set out in the Award. I am not satisfied that the other higher functions Ms Muscat performed result in her not being principally employed to perform the work covered by a Property Manager Supervisor.
[86] I conclude that having made the finding above, Ms Muscat is protected from unfair dismissal within the meaning of s.382 of the Act. The jurisdictional objection of Chase is dismissed. The application will be reallocated to the Unfair Dismissal Case Management Team.
Mr R Ivessa of counsel, instructed by Colwell Wright Solicitors for the Respondent
[12] Fair Work Act 2009 ss 143(1) & (2).
[13] Fair Work Act 2009 s 143 (5)(b).
[15] Appeal by Brand against decision of Deegan C of 19 June 2003 [PR933272] Re: APIR Systems Ltd, Giudice J, Marsh SDP, Thatcher C, 16 September 2003 [PR938031].
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Karen Muscat
Chase Commercial Pty Limited T/A Chase Commercial [2018] FWC 1398