Fair Work Act 2009

s.394 - Application for unfair dismissal remedy

Mt Eliza Home Services Pty Ltd T/A My Home Residential Cleaning

Application for unfair dismissal remedy - jurisdiction - whether Respondent was a small business at the time of the dismissal - whether Applicant had completed the minimum employment period at the time of dismissal - satisfied that Respondent not a small business at time of dismissal - satisfied the Applicant had completed the minimum employment period at the time of dismissal. Jurisdictional objection dismissed.

[1] On 23 January 2020, Ms Vallery Jean-Louis (the Applicant) made an application to the Fair Work Commission (the Commission) under s.394 of the Fair Work Act (the Act) for an unfair dismissal remedy in respect of the termination of her employment by Mt Eliza Home Services Pty Ltd T/A My Home Residential Cleaning (the Respondent). The Respondent asserts that the Applicant is not a person protected from unfair dismissal as she was only employed by the Respondent from 7 September 2019 to the date of her dismissal, 8 January 2020. If this is correct, the Applicant has not completed period of employment of at least the minimum employment period and therefore is not a person protected from unfair dismissal. The Respondent also asserts it was a small business employer as defined in the Act at the time of dismissal with 14 employees. Whether or not the respondent was a small business at the relevant time will have an impact on determining the relevant minimum employment period. This decision deals with the Respondent's jurisdictional objection only.

[2] On 26 February the Respondent provided the Form F3 - Employer response to unfair dismissal application (Form F3). The response to question 2.2 of the Form F3 stated that the Respondent had jurisdictional objections because the Applicant did not meet the minimum employment period, being employed full time from 7 September 2019 to 13 December 2019; and that the Employer is a small business employer and the Employer complied with the Small Business Fair Dismissal Code.[1] Despite claiming the applicant worked until 13 December 2019, the respondent stated that the dismissal took effect on 8 January 2020.[2]

[3] On 27 February 2020 the Respondent was sent correspondence by the Unfair Dismissal Case Management Team (UDCMT) of the Fair Work Commission asking if he was willing to participate in the Conciliation Conference,[3] which the Respondent answered in the affirmative.[4] The matter was subsequently listed for Conciliation by telephone on 17 March 2020.

[4] On 17 March 2020 the Respondent failed to attend a scheduled Conciliation.

[5] On 18 March 2020 Ms Vicki Caslake telephoned the UDCMT to inform that the Respondent is in voluntary administration with Rogers Reidy as the Administrator. A subsequent email dated 26 March 2020 from the Administrator for the Respondent indicated that they did not consent to the commencement of proceedings pursuant to s 440D of the Corporations Act 2001[5].

[6] The UDCMT sent correspondence to the Administrator for the Respondent on 2 April 2020 indicating that as per ss 440D(1) and 58AA of the Corporations Act 2001 and in line with the determination in Smith & Ors v Trollope, Silverwood & Beck,[6] Commissioner Bissett, in her position as National Practice Leader. advised the matter will proceed and be listed for Jurisdiction (Minimum Employment Period) Conference/Hearing.[7] On 4 April 2020 the Administrator for the Respondent reiterated that they do not consent to the commencement of proceedings. On 14 April 2020 the UDCMT informed the Administrator for the Respondent that in the absence of submissions from the Respondent the matter will proceed to Hearing.[8]

[7] At the Hearing on 13 May 2020 representatives of the Administrator for the Respondent appeared. The representatives stated that the dismissal of the Applicant occurred prior to their appointment; that the books and records of the company are insufficient and that they had reported the Director's breach under s. 286 of the Corporations Act 2001 to ASIC. The Administrator for the Respondent stated they had no further comments to make on the termination of the Applicant as they could not substantiate anything that would be said. Consequently, the representatives elected to depart the Hearing at that point.[9].

[8] The Hearing continued with only the Applicant present. I agree with the reasons set out in the letter of Commissioner Bissett cited above that there is no barrier to the matter proceeding. I am also satisfied that it is appropriate to do so.

(1) A person who has been dismissed may apply to the FWC for an order under Division 4 granting a remedy.

(a) within 21 days after the dismissal took effect; or

(b) within such further period as the FWC allows under subsection (3).

[10] The Applicant's termination of employment took effect on 8 January 2020 and the Applicant's application was lodged on 23 January 2020. The application was made within the statutory period.

[11] Section 386 sets out when a person is dismissed:

(a) the person's employment with his or her employer has been terminated on the employer's initiative; or

(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer."

[12] There is no dispute the Applicant was terminated on the Employer's initiative.

[13] Section 382 provides:

"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."

[14] The Respondent disputes that the Applicant has completed a period of employment that is at least the minimum employment period. This is a matter that is required to be determined.

[15] In respect to s 382(b) it is not in dispute that a Modern Award, the Cleaning Services Award 2010, applies to the Applicant.[10]

[16] The minimum employment period is dealt with in s 383 as follow:

(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;

(ii) immediately before the dismissal; or

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

[17] In this matter, the Respondent asserts in their Form F3 that the Applicant began working for the Employer on 7 September 2019. This is a period of less than six months. In those circumstances no matter whether the Employer is a small business or not, the minimum period of employment would not be met. The Applicant asserts that she commenced employment with the Respondent on 6 November 2017.

[18] Section 384 sets out the meaning of period of employment:

(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."

(a) a period of service as a casual employee does not count towards the employee's period of employment unless:

(i) the employment as a casual employee was on a regular and systematic basis; and

(ii) during the period of service as a casual employee, the employee had a reasonable expectation of continuing employment by the employer on a regular and systematic basis;"

[19] An explanation of the meaning of excluded periods and continuous service are summarised in the Fair Work Commission Benchbook and are replicated below:

See Fair Work Act s.22

An excluded period does not break an employee's continuous service with their employer. However, it does not count towards the length of the employee's continuous service. Periods of casual employment may affect the length of an employee's continuous service for the purpose of an application for an unfair dismissal remedy.

The following are periods that are excluded from the definition of 'service' and therefore for the purpose of calculating the minimum employment period:

• certain periods of unpaid leave or unpaid authorised absence (there are exceptions for community service leave, certain stand downs and prescribed leave or absences).

The following are examples of unauthorised absence:

• periods of industrial action engaged in by employees, and

• other absence from work contrary to the direction of the employer.

The following are examples of unpaid authorised absence:

The above periods do not break service however they are not counted in the calculation of the minimum period of employment." [11]

See Fair Work Act s.22

Service is a period during which an employee is employed by an employer, but does not include certain excluded periods (see below).

Continuous service is a period of unbroken service with an employer by an employee.

As continuous service was not clearly defined in the Fair Work Act the Commission has decided that the term should be given its ordinary meaning.

Periods of unauthorised absence, certain types of unpaid leave and certain types of unpaid authorised absence do not count as service and are considered to be excluded periods.

An excluded period does not break an employee's continuous service with their employer. However, it does not count towards the length of the employee's continuous service.

In other words, section 22(3) of the Fair Work Act deems that in some circumstances, service that is not continuous can be considered continuous depending on the reasons for the periods of absence."[12]

[20] Section 23 sets out the meaning of small business:

(1) A national system employer is a small business employer at a particular time if the employer employs fewer than 15 employees at that time.

(2) For the purpose of calculating the number of employees employed by the employer at a particular time:

• (a) subject to paragraph (b), all employees employed by the employer at that time are to be counted; and

• (b) a casual employee is not to be counted unless, at that time, he or she has been employed by the employer on a regular and systematic basis.

(3) For the purpose of calculating the number of employees employed by the employer at a particular time, associated entities are taken to be one entity.

(4) To avoid doubt, in determining whether a national system employer is a small business employer at a particular time in relation to the dismissal of an employee, or termination of an employee's employment, the employees that are to be counted include (subject to paragraph (2)(b)):

• (a) the employee who is being dismissed or whose employment is being terminated; and

• (b) any other employee of the employer who is also being dismissed or whose employment is also being terminated."

[21] There is a dispute as to whether the Respondent is a small business employer at the time the Applicant was dismissed. This is relevant to the determination of whether or not the Applicant meets the minimum employment period.

[22] Given the circumstances outlined above, I only have the evidence of the Applicant in the matter with the exception of the Form F3 filed by the Respondent.

[23] The Applicant provided evidence as to the period of employment.

[24] The evidence was to the effect that from November 2017 to July 2018 she was employed full time by the Respondent.

[25] In July 2018 she resigned her employment. She claimed that she left due to a toxic work atmosphere, unreasonable targets and mismanagement.[13]

[26] As the Applicant resigned at that time, it is apparent she broke the period of continuous service at that point. Soon after resigning, the Applicant recommenced employment with the Respondent on 4 August 2018 on a casual basis.

[27] The Applicant gave evidence that she was casually employed from August 2018 to September 2019 and that she was employed on a full-time basis after September 2019. The Applicant supplied numerous payslips that covered the period of employment. However. there are some gaps in the periods covered by the payslips.

[28] With respect to the dates that payslips were not provided, the Applicant gave the following evidence:

"So that week I probably called in sick because I was really sick during the time that I was working for this company."[14]The Applicant gave evidence that she may have a record of days worked, for which she had not provided a payslip, via maps on her phone.[15] The Applicant provided further submissions on 20 May 2020 which included a screenshot of a map indicating that she had worked on 11 August 2018.[16]

"I wasn't working during that time because I had gotten into an accident and I wasn't able to work. I recommenced once I was cleared and able to work."[17]

"So I'm not sure why I didn't work those periods. I will check my records again, but I'm not sure."[18]

"So it might have been the same situation."[19] The Applicant confirmed that she did not work during this period.[20]

"So for that week, I want to say that I was possibly sick, but I wouldn't have those records unless I looked in my text messages."[21]

"I am not sure why I would have not worked. I was - yes. I'd have to - the only way I would have to know whether or not I worked those weeks is if I checked my maps, because some of the payslips I wasn't given."[22]

"I was still employed. So I'm not sure if I called in sick or if I just for some reason wasn't given that pay slip."[23] .

"So I had a knee injury on 14 December and I gave Marlon medical certificates showing that I wasn't able work and I also got a clearance form to return back to work in January."[24]

[29] From the period 1 June 2019 there are payslips covering all of the periods up until 13 December 2019 with the exception of the week 22 June 2019 to 28 June 2019. These payslips show that the Applicant was employed on a regular and systematic basis throughout that period. The Applicant states that she reverted to full time employment from the 6 or 7 September 2019. This perhaps explains why the Respondent asserts in the Form F3 that the Applicant's period of employment commenced at that time. I accept the Applicants evidence that she converted to full time employment on that date. The Applicant did not work from 14 December 2019 until her dismissal on 8 January 2020. The Applicant's evidence was that she had injured her knee and had provided a medical certificate to her Employer and received clearance to return to work in January 2020.[25] Her evidence is consistent with the SMS exchanges with the Employer in evidence.

[30] The SMS exchanges indicate that the Employer advised the Applicant she was entitled to "sick pay" for at least some of that period, however it is not clear if the Applicant was paid personal leave for all of that period or if some of the period was unpaid leave. The Applicant is claiming various entitlements from the Employer including personal leave

[31] The SMS exchanges confirm the Applicant's evidence that she advised the Respondent she was ready to return to work, the Respondent replied that he had sent an email to her that the Applicant needed to read. That email advised the Applicant she was dismissed. The Applicant ultimately saw the email on 8 January 2020. It is apparent that the termination of employment took effect on that date.

Was the Respondent a Small Business at the time of the dismissal?

[32] The Respondent states in the Form F3 that there were 14 employees at the time of the Applicant's dismissal. No evidence was provided in support of that contention.

[33] The Applicant provided a list of names of employees she said were employed at the time of her dismissal. The list of names includes the name of the Employer, Marlon Scheucher, and fourteen other employees totalling 15 employees. However, the Applicant also gave evidence that at the time she was dismissed there were other employees engaged as it was the Christmas period and the Respondent had employed a lot of new employees. Furthermore, the Applicant gave evidence that the Respondent has a second cleaning company known as Essential Home Services and employees from the second company also work for Mt Eliza Home Services PTY LTD T/A My Home Residential Cleaning, being the company the Applicant was employed by, of which the Respondent was the Director.[26]

[34] The Respondent has provided no evidence to support the claims in the Form F3 that there were 14 employees. The Applicant has listed 15 employees she claimed were employed at the time of the dismissal. This includes Mr. Scheucher the Director. A Director may or may not be an employee, depending on the circumstances.[27] The Applicant gave evidence to the effect that the Director appeared to be an employee of the business as he got all the cars and equipment ready for employees, looked for new clients, scheduled cleanings and would also come in and clean or supervise cleans with the employees.[28]. There is no evidence from the Respondent on the point. I am satisfied that Mr. Scheucher was an employee of the Respondent In any case, the Applicant was clear and convincing in her evidence that there were additional employees beyond those she had listed, employed during the Christmas holiday period to cater for the increased demand at that time. I prefer the evidence of the Applicant over that of the Respondent that there were more than 15 employees at the time of dismissal.

[35] It is apparent from the evidence that the Applicant was employed on a casual basis from 4 August 2018 and on a full-time basis from 7 September 2019. The period of employment prior to 4 August 2018 is irrelevant as the period of service was broken by the resignation of the Applicant in July 2018.

[36] From 4 August 2018 until 31 August 2018 the Applicant was engaged intermittently. It is not apparent that there was a period of regular and systematic employment during that period. In particular there is a lengthy absence of the Applicant from the workplace from 1 September 2018 to 4 January 2019. This period of absence was a result of a car accident according to the Applicant.[29]

[37] However, the period commencing 1 June 2019 until 7 September 2019 when the Applicant converted to full time employment, the Applicant was clearly engaged on a regular and systematic basis and had a reasonable expectation of ongoing employment on a regular and systematic basis[30]. During that period there was only one week the Applicant did not work, which was the period 22 June 2019 to 28 June 2019. The Applicant was clear that she was still employed with the Respondent during that period but could not recall if she had called in sick or simply was not provided a payslip for that period.[31]

[38] From the 7 September 2019 the Applicant commenced full-time employment and worked continuously until 14 December 2019. From 14 December 2019 until her dismissal on 8 January 2020 the Applicant was on a period of paid and unpaid leave on account of her knee injury.

[39] Combining the Applicant's employment on a casual basis from 1 June 2019 combined with the period of full-time employment that preceded her termination of employment, the period of continuous service was over seven months. It is not clear how much of the period between 14 December 2019 and 8 January 2020 the Applicant was entitled to paid personal leave. However, even if it was the case that all of the period between 14 December 2019 and 8 January 2020 was unpaid personal leave, (a period of 26 days) and therefore an excluded period from calculating the length of the employees continuous service with the employer, the length of the Applicant's continuous service is still in excess of six months.

[40] I am satisfied that the Respondent was not a small business at the time of the dismissal.

[41] I am also satisfied that the Applicant had completed a period of continuous service immediately prior to the date the dismissal took effect of more than six months.

[42] As the Respondent was not a small business at the time of the dismissal, the Applicant has completed the minimum employment period.

[43] The jurisdictional objection is therefore dismissed. The application will be listed for Merits Hearing as soon as possible.

[1] Q2.2 of Respondent's Form F3 - Employer response to unfair dismissal application, dated 26 February 2020.

[2] Q1.4 of Respondent's Form F3 - Employer response to unfair dismissal application, dated 26 February 2020.

[3] Email correspondence form the Fair Work Commission dated 27 February 2020.

[4] Email from the Respondent dated 27 February 2020.

[6] (2003) 142 IR 137.

[7] Email correspondence form the Fair Work Commission dated 2 April 2020.

[8] Email correspondence form the Fair Work Commission dated 14 April 2020.

[10] Applicants Form F2 - Unfair dismissal application dated 23 January 2020; Respondent's Form F3 - Employer response to unfair dismissal application dated 26 February 2020.

[11] Benchbook on Unfair Dismissal - https://www.fwc.gov.au/resources/benchbooks/unfair-dismissals-benchbook; sees page 51.

[12] Benchbook on Unfair Dismissal - https://www.fwc.gov.au/resources/benchbooks/unfair-dismissals-benchbook; sees page 50.

[13] Q2f of Applicant's Outilne of argument: objections, received on 28 April 2020.

[16] Applicant's final submission dated 20 May 2020.

[27] Sappiden, O'Grady, Riley, Macken's Law of Employment, Seventh Edition Law Book Company 2011 at 2.380, page 52.

[30] Benchbook on Unfair Dismissal - https://www.fwc.gov.au/resources/benchbooks/unfair-dismissals-benchbook; sees pages 84 -86.

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