Kevin Graham Scott v Bruce Wallace Picone and ors.

Kevin Graham Scott v Bruce Wallace Picone and ors. - [2002] NSWIRComm 239 - NSWIRComm 1999 case summary — Zoe

[26]

16 In paragraph 43 of the summons for relief, the applicant set out in detail the alleged unfairness of the contract between the applicant and the respondent. It is appropriate that the terms of the alleged unfairness be recounted for the purposes of the challenge to jurisdiction mounted by the respondents. The unfairness was said to be constituted by the following matters: (a) it failed to require the Respondents to devise, maintain and implement a standard, rational, fair and transparent approach to its contract with the Applicant (b) it permitted the Respondents to impose an arbitrary and discriminatory approach to the payment of wages under the contract in that the Respondents unilaterally withheld a significant proportion of the Applicant's wages; further it permitted the Respondents to continue to withhold those monies after the cessation of the contract; (c) it permitted the Respondents to avoid payment of reasonable rates for -work performed by the Applicant ; (d) it permitted the Respondents to avoid its obligations in respect of the provisions and payment for annual leave and long service leave to the Applicant: (e) it permitted the Respondents to deduct monies from the Applicant's wages purportedly for AMP shares without consulting with the Applicant or obtaining his agreement to that course of payment; (f) it allowed the Respondents to avoid giving the Applicant any opportunity to negotiate the terms and conditions upon which payments should be made to him; (g) it allowed the Respondents to impose unilateral and arbitrary conditions upon the Applicant including a restriction on visitors, requiring the Applicant to obtain permission to leave the property and requiring the Applicant to pay for machinery and parts that were to be used in maintenance of the Respondents' equipment; (h) it failed to provide any measures to compensate the Applicant in respect of the deduction from his wages for alleged payments to a superannuation fund and for the alleged purchase of AMP shares; (i) it failed to provide the Applicant with any information as to the level of equity achieved in an alleged superannuation fund or the sum of the payment made during the course of the contract, particularly taking into account that any amount in excess of $80.00 per week was allegedly being put into such a superannuation fund and that the Applicant had worked significant periods of overtime during the course of the contract; (j) it was on its face unfair, harsh and unconscionable and contrary to the public interest in that it permitted the Respondents to pay the Applicant only $80.00 per week (together with electricity, water and groceries) for working approximately 77 hours per week; (k) the First Respondent exerted influence and pressure on the Applicant to withdraw his complaint to the DWR and misled him as to the monies that were to be paid to the Applicant in respect of outstanding wages and leave, in circumstances which were unjust and unconscionable; (l) the First Respondents exerted influence and pressure on the Applicant not to make further complaints to the DWR by imposing unreasonable conditions upon the Applicant including those referred to in sub-paragraph (g) above, in circumstances which were unconscionable; (m) it failed to provide for any or any adequate or reasonable compensation, in respect of length as well as prospective years of service, to the Applicant by the Respondent upon termination of employment for any reason; (n) it invested the Respondents with significant discretionary powers which have been used to the substantial disadvantage of the Applicant particularly in the circumstances relating to the withdrawal of the complaint to the DWR and/or the failure to compensate the Applicant in respect of monies withheld from wages under the contract; (o) the Applicant was at all material times in a position of unequal and inferior bargaining power in respect of his dealings with the Respondents and was specifically in such a position at the time of withdrawing his complaint from the DWR; (p) without limiting the generality of sub-paragraph (o) above the Applicant was at all material times in a position of unequal and inferior bargaining power in that: (i) the Respondent refused to allow any negotiation of the conditions which would prevail under the contract; (ii) the Respondent advised the Applicant of the changes to the contract in a manner which caused distress, anxiety and humiliation to the Applicant; (iii) the Respondent refused to compensate the Applicant in respect of the monies that had been withheld from his wages pursuant to the contract at the time the contract was terminated despite the fact that the Respondent had agreed to a term in the contract that provided that the portion of the Applicant's wages in excess of $80.00 per week would be paid into a superannuation fund on behalf of the Applicant; (q) it failed to protect the Applicant against the harsh, unjust or unreasonable operation of the contract; (r) it was otherwise unfair, harsh and unconscionable and contrary to the public interest upon such grounds and for such reasons as this Honourable Court may find.

[28]

(b) In the event that the Respondents (or any of them) have (by agreement or otherwise) withheld any part of the Applicant's total remuneration package between the date of commencement of employment and the date of termination, the Respondents shall pay to the Applicant the amount so withheld together with interest on that sum calculated using the interest rates prescribed by Schedule J of the Supreme Court Rules. These monies shall be payable on the date that the contract between the Applicant and the Respondents is terminated. (c) Upon termination of the Applicant's employment for any reason, the Respondents shall pay to the Applicant a notice/severance payment equivalent to nine months total remuneration. 4. An order declaring void in whole and ab initio the agreements and releases executed by the Applicant in favour of the Respondent indicating that the dispute as to outstanding wages and leave had been resolved. 5. Further, or in the alternative, an order that the Respondent pay to the Applicant such amount of money in connection with contract so avoided or varied as may appear to be just in the circumstances. 6. An order that the Respondent pay to the Applicant interest upon such amount of money as is ordered to be paid to the Applicant in connection with the contract at such rates and in respect of such period of time as this Honourable Court considers appropriate. . 18 The amended summons for relief said that the contract of employment was one whereby the applicant was employed by the respondents as a "cotton farmhand". The applicant's duties were said to include, amongst other things, driving tractors and running the irrigation system as well as being a station hand on the property. These duties were carried out in accordance with directions from the first and/or second respondent and their employees for the benefit of all the respondents. The respondents read and relied upon the affidavit of the applicant already filed in the proceedings as containing certain admissions upon which they relied. He described his experience on various farms in New South Wales and Queensland including working on cotton farms and working in factories putting sugar cane machinery together. He stated that most of the work he had performed was of a labouring nature working on farms as a farmhand, driving tractors to work and planting cotton seeds from a tractor. He had commenced work on Bruce Picone's property in 1988-9 which was a cotton farm at Moree. He said that each day part of his duties were to water and feed Mr Picone's exotic birds and that would take about an hour a day and in addition he would have to clean out the birdcage each week and this would take the whole of the day. Mr Picone was said to have over 500 birds and during the busy irrigation season he had to do this work after the day's work had ended. He said that the work of looking after the birds was payment for the electricity and water he used while living on Mr Picone's property. His work for Mr Picone involved labouring work which required him to assist with the irrigation of the farm. This involved preparing irrigation systems and checking irrigation gates every two hours for 24 hours during October to March each year. This involved him working night shift, working from approximately 4.00 pm through to 8.00 or 9.00 am the next morning.

[32]

22 Rule 9 deals with membership applications and provides that the Executive Committee shall prescribe forms of application for membership and that such forms shall include a requisition "that every person or every partnership or the proper officer of every family company or the proper officer of every company other than a family company shall therein declare whether or not he or the partnership or the company is the owner or occupier of property in the Association's sphere of operation and, if so, the name and address of each and every such separate property …. Every person, partnership or company shall upon applying for membership, pay the annual contribution therein after prescribed". Rule 2, dealing with membership admission, provides as follows: All applications for membership will be subject to acceptance by the Executive Committee which may refuse such application on any of the following grounds: (i) That the applicant is not eligible for membership; (ii) that the applicant is of general bad character; (iii) that the applicant has failed to observe the requirements of membership application herein contained; (iv) the applicant has failed to register all properties owned or occupied by him or failed to pay the prescribed contribution in respect of each or any property. Rule 19 deals with how membership contributions are set and provides in sub-rule (ii), as follows: (ii) Each member whether a person, partnership or company engaged in wool, livestock, grain or other agricultural production who is the owner or occupier of a property or properties, shall pay an annual contribution which shall be the minimum general contribution together with a progressive amount calculated on livestock and agricultural production as provided below. Sub-rule (v) states that for the purpose of this Rule, membership contributions in respect of a person, partnership or company operating two or more separate properties, shall be assessed separately in respect of each and every property owned or occupied unless total stockholding and grain and agricultural produce sales are consistently less than 20,000 sheep equivalents, in which event they may at the Executive Committee's discretion be registered and assessed collectively.

[36]

26 Section 152 of the Workplace Relations Act, a Commonwealth law, provided: [s 152] Awards to prevail over State Laws and State awards 152(1) [Awards to prevail] Subject to this section if a State law or a State award is inconsistent with, or deals with a matter dealt with in, an award, the latter prevails and the former, to the extent of the inconsistency or in relation to the matter dealt with, is invalid. (1A) [State laws making provision in respect of termination] If a State law provides protection for an employee against harsh, unjust or unreasonable termination of employment (however described in the law), subsection (1) is not intended to affect the provisions of that law that provide that protection, so far as those provisions are able to operate concurrently with the award. (2) [State employment agreement previously in force] If: (a) but for this subsection, an award would become binding on an employer in respect of an employee at a particular time; and (b) immediately before that time, the wages and conditions of employment of the employee were regulated by a State employment agreement; then the award is not binding on any person in respect of the employee, while the wages and conditions of employment of the employee continue to be regulated by the agreement (3) [State employment agreement made after commencement of subsection (3)]. If, at a particular time, a State employment agreement that is made after the commencement of this subsection would regulate wages and conditions of employment of an employee but for the fact that an award is binding on an employer in respect of the employee, then: (a) the award does not prevent the agreement from coming into force and regulating the wages and conditions of employment of the employee; and (b) while the agreement continues to regulate those wages and conditions, the award is not binding on any person in respect of the employee. (4) ["award"] In subsection (3), "award" does not include an award made under subsection 170MX(3) (5) [Requirements for application of subsections (2) and (3)]. Subsection (2) and (3) do not apply to a State employment agreement unless the agreement is one that was approved by a State industrial authority under a State Act that required the authority, before approving the agreement, to be satisfied: (a) that the employees covered by the agreement are not disadvantaged in comparison to their entitlement under the relevant award; and (b) that the agreement was genuinely made, or that the agreement was not made under duress or that the agreement was made without coercion; and (c) that the agreement covers all the employees whom it would be reasonable for the agreement to cover, having regard to matters (if any) specified in the State Act (such as the nature of the work performed under the agreement and the relationship between the employees in the part of the business covered by the agreement and the remainder of the employees in the business). 27 By reference to the judgment of Kirby P in Majik Markets Pty Ltd v Brake and Service Centre Drummoyne Pty Ltd (1992) 28 NSWLR 443 it was submitted that an inconsistency exists where there is a "textural collision" between the provisions of a Commonwealth and State Act. Even if there was no such collision an inconsistency would arise where the intention of a paramount legislature was, by its enactment, to completely exhaustively or exclusively express the law governing a particular conduct or matter (Clyde Engineering Co Pty Ltd v Cowburn (1926) 37 CLR 466; Ex parte McLean (1940) 43 CLR 472 at 403). An inconsistency arose where a law purports to confer a legal right, privilege or entitlement which the other law purports to take away or diminish (Colvin v Bradley Bros Pty Ltd (1943) 68 CLR 151).

[61]

DELIBERATION 52 In Thornthwaite v Australian National Credit Union Limited [2002] NSWIRComm 240, (a case argued two days before the present matter and where judgment was handed down at the same time as judgment in this case) I have set out what I consider to be the relevant case law when dealing with alleged inconsistency arising between an award (or certified agreement) and s 106 of the Act. I do not repeat in this judgment those matters to which I have referred in Thornthwaite. However, I rely on that discussion of the relevant principles and adopt it for the purpose of this judgment. Similarly, for the reasons set out in Thornthwaite, I adhere to the following conclusions: (a) to establish the operation of s 152 of the Workplace Relations Act, the matter dealt with by the Federal award must be established with precision; (b) even where there is a comprehensive Federal award a consideration of its terms may indicate that there are areas left for the operation of a State law; (c) it is usual for Federal awards to operate against the background of general statute law, both State and Federal, which are not intended to be displaced by the award provisions; (d) section 106 of the New South Wales Act is a general statutory provision whose field of operation may be described as dealing with contractual unconscionability, a field not usually addressed by Federal awards or agreements ; (e) that the contention cannot be sustained that a minimum rates award, standing alone and made in compliance with the provisions of s 89A of the Workplace Relations Act 1996 [Cth] evinces an intention to cover the field in relation to the matters with which it deals; (f) that such an award made under Commonwealth law does not, simply by its own operation, become part of the contract of employment - the Commonwealth law and awards made under it, without more, do not operate in the same field nor deal with the same matter as s 106 of the New South Wales Act. In my view the respondents have made a very limited attempt to establish the "matter" dealt with by the Federal award and, in any event, have wrongly categorised the field of operation of s 106 of the State Act. The respondents have not adequately addressed the minimum rates nature of the Federal award in the context of applying the covering of the field test.

[62]

53 Apart from these general principles and findings which appear to have application to the present matter, having regard to the current state of the evidence, there are other insurmountable difficulties placed in the path of the respondents in making out their case on the notice of motion, namely: (a) at the heart of the respondents' case is the operation of the Federal award yet there is no evidence or insufficient evidence as to what classification the applicant is said to come within under that award but merely an assertion by the respondents that he is "probably" a Class 3 station hand; (b) there is evidence of a variety of duties performed by the applicant which suggests a mixed function role and the possibility of other award (State or Federal) application. Those duties include care of exotic birds, driving the first respondent in relation to his business as a bookmaker and the maintenance rather than the operation of machinery; (d) the unsatisfactory position of the respondents relying upon the evidence in the applicant's affidavit as to his duties when that evidence was not directed to the question of award coverage. That issue had not arisen when the affidavit was sworn. There is a real prospect that the evidence is incomplete for the purposes of determining award coverage; (e) the respondents rely on being the registered owners of a business name, Picone Pastoral Company, and that the respondents carry on a partnership under that business name as proving the respondents' eligibility for and actual membership of the New South Wales Farmers' (Industrial) Association and thereby their respondency to the Federal award. The partnership arrangement is merely asserted and there is no evidence to support such a finding. The Partnership Act 1892 in s 2 sets out a number of rules for determining the existence of a partnership, none of which have been addressed by evidence on the hearing of the notice of motion. Other aspects of the Partnership Act such as the power of a partner to bind the firm and agreements as to the liability of a partner or the liability of the firm for certain wrongs has also not been addressed; (f) there is no evidence as to the nature of the business carried out by the four respondents except to a limited extent in relation to the first respondent. Similarly, there is no evidence or insufficient evidence that the four respondents are usually employers in or in connection with the industry (as defined by Rule 2) in relation to which the New South Wales Farmers' (Industrial) Association is registered. There is force in the applicant's submission that rules of registered organisations are treated by the courts as "mandatory" (to use a term now regarded as inappropriate). This combination of matters makes it quite impossible on the current state of the evidence to make a finding that the four separate respondents to the s 106 proceedings are firstly respondent to the Federal award, or that the Federal award covers the work performed by the applicant. Mere assertion and supposition is a totally inadequate basis upon which to establish s 109 inconsistency.

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