//
[155]
[2021] FWCFB 154
General information, not legal advice.
Fair Work Commission (Full Bench)
2021-01-27
Original judgment source is linked above.
s.604 - Appeal of decision
Staffing and Office Solutions Pty Ltd T/A SOS Recruitment
Appeal against decision [2020] FWC 4684] of Commissioner McKenna at Sydney on 30 September 2020 in matter number U2020/2942.
[1] Mr Paul Dirkis (the Appellant) has applied for permission to appeal and if granted appeals against a decision (the Decision) and an associated order made by Commissioner McKenna, both made on 30 September 2020.[1] The matter at first instance involved the determination of various jurisdictional objections to the Appellant's unfair dismissal remedy application (the Application) advanced by the Respondent, Staffing and Office Solutions Pty Ltd (the Company). The jurisdictional objections were originally the subject of a hearing before Deputy President Kovacic, wherein a decision was reserved. Following the untimely death of our colleague, the file was reallocated to Commissioner McKenna for the determination of those jurisdictional objections.
[2] The jurisdictional objections raised by the Company were that the Applicant:
(a) was not dismissed under s.385 of Fair Work Act 2009 (the Act); and
(b) was not a person protected from unfair dismissal under s.382 of the Act as:
(i) the Applicant has not completed a period of employment of at least the minimum employment period; and
(A) was not covered by an award or enterprise agreement; and
(B) had an average annual rate of earnings that exceeded the high-income threshold.
[3] The Commissioner did not accept a number of the Company's objections to the Application, however she did accept the Company's jurisdictional objection that the Appellant's employment was award-free and agreement-free, and that the Appellant's income otherwise exceeded the high-income threshold. The Commissioner ordered the dismissal of the Application. This appeal was listed for hearing in respect of permission to appeal and the merits of the appeal before this Full Bench on 3 December 2020.
[4] The following matters of background may be discerned from the Commissioner's decision:
The Company is a labour hire company. The Appellant was employed by the Company pursuant to the terms set out in a letter dated 28 May 2019 (the Letter of Appointment) and an annexed document titled "Agreement, Terms and Conditions of Temporary Work for SOS Recruitment Casual Labour Hire Employees" (the Agreement). The Appellant's income was outlined in the Letter of Appointment as follows:
"Your gross casual hourly rate will be $100.00 plus 9.5% superannuation. Your gross casual hourly rate is made up of the following: $80 plus 25% casual loading ($20) = $100.00. Your standard working week is 40 hours, if you are required to work more than 10 hours a day or 40 hours per week you must obtain your manager's prior approval."
1. I understand that I will be paid as a casual on-hire employee under the Clerks - Private Sector Award 2010 ('the Award') whether I am working in Government sector or the private sector.
2. If the position is in the Government sector (Commonwealth, State/Territory) I understand that SOS Recruitment may use that Department's Enterprise Agreement pay structure to calculate my casual hourly rate but is not legally bound to do so because my salary, terms and conditions of employment fall under the award.
3. I understand that I will be a casual employee (within the meaning of the Award and the Fair Work Act 2009 ('the Act') of SOS Recruitment throughout the course of all temporary assignments.
4. I understand that any amount paid to me by SOS Recruitment under this Agreement can be used by SOS Recruitment to offset, absorb and be credited against all and any wages or monetary entitlement (however described) that I am entitled to under the Award, the National Employment Standards under the Act, or any enterprise agreement that exists in the future.
5. I understand that the casual loading of 25% is compensation for ALL permanent employee entitlements under the National Employment Standards/the Award including:
• All other payments/allowances accorded to permanent employees."
44. I understand that my work hours are generally Monday to Friday and can range between 7.00am and 7.00pm.
45. Exact work hours are to be agreed between my manager and myself.
46. Lunch hour is to be taken between 12.00pm and 2.00pm. It must be at least 30 minutes and no longer than 60 minutes (unless you have obtained prior approval from your manager). It is suggested that you try to have the break at the same time each day so that the manager can plan the workload. Please seek your managers' opinion/approval on your first day and if it changes advise them accordingly.
47. My ordinary hours of work will not exceed 40 per week without my managers' prior approval."
50. I will record my work hours (arrival/departure times) on the SOS Recruitment timesheet on a daily basis honestly and accurately.
51. I understand that if I deliberately falsify my timesheet, this is serious misconduct and my assignment will be terminated immediately.
52. I will ensure that the timesheet is received by email in SOS Recruitment Offices no later than Monday 11.00am following the week I have worked. Even though timesheets are not required until Monday it may be beneficial to have your manager approve your timesheet prior to your departure on Friday.
53. I accept that if SOS Recruitment does not receive the timesheet by that time that payment will be held over to the following week, as SOS Recruitment cannot delay processing of pays.
54. I will email the completed timesheet to my manager for authorisation, keep a copy for myself and email a copy to SOS Recruitment.
55. I will be paid weekly on the basis of the timesheet authorised by my manager.
56. I understand that I will NOT receive payment for work until SOS Recruitment has received a duly authorised timesheet that has been signed by me and approved by my manager.
57. I understand that it is my responsibility to ensure that SOS Recruitment has received my duly authorised timesheet.
58. Payment to me will be made by Electronic Funds Transfer to the bank account nominated by me by midnight, Thursday following the week I have worked.
59. I understand that future payments may be adjusted if actual working hours or other details are different from the information provided on the authorised timesheet. I agree that SOS Recruitment can deduct any overpayments from future payments to me.
60. If I have any time off work due to sick leave, public holidays, personal leave or any other absences, I will NOT be paid for this time as I am employed on a casual basis (my salary incorporates a 25% loading in lieu of these entitlements).
61. I understand that SOS Recruitment will email the Pay Slip Advice on a weekly basis for the previous week worked. (Please keep the pay slips safe as SOS Recruitment is NOT able to re-print pay slips)
62. I agree to notify SOS Recruitment and their client as soon as practicable, but no later than normal start time on any day, if I am unable to attend work during any period of an assignment."
• The Appellant did not actually work 40 hours each and every week of his placement at the DVA. The Appellant stated[2] that in the 40 weeks of his placement at the DVA, there were 8 weeks where he performed no hours of work, and 13 weeks where he did less than 40 hours work.
(a) Wednesday 28 August 2019, to Monday 2 September 2019;
(b) Monday 7 October 2019, to Sunday 20 October 2019;
(c) Tuesday 24 December 2019, to Thursday 2 January 2020; and
(d) Monday 20 January 2020, to Wednesday 19 February 2020.
Back Pay Wages (being wages paid in following weeks where
Salary Sacrifice Superannuation Deductions -$3,000.00
Superannuation Guarantee Superannuation Expenses $8,618.89
[5] Due to the parameters of the Appeal, the Commissioner's decision is only relevant as it related to the determination that the Letter of Appointment and the Agreement recorded the terms of the employment between the Appellant and the Company, and to the further two grounds arising from s.382(b) of the Act, being:
(i) Whether a modern award or an enterprise agreement applied to the Appellant; and
(ii) Whether the sum of the Appellant's annual rate of earnings is less than the high-income threshold.
(a) The Letter of Appointment and Agreement Recording the Terms of Employment
[6] The Commissioner noted that the matter before her involved a not unusual triangular employment relationship of a labour hire employee, a labour hire company, and the decision of a host employer that it no longer wants the services of the particular employee. The Commissioner found as follows regarding the Appellant's contentions about the Agreement:[3]
"I should say some things about the Agreement. For his part, the applicant contended that the employment with the respondent commenced on a date earlier than when a letter setting out certain employment-related matters and the Agreement were provided to him. I do not accept this was the case. Moreover, in connection with the letter and the Agreement, the applicant took steps to attend to matters such as the provision of financial institution details for payment and presented for work at DVA in accordance with the offer and his acceptance; and those matters broadly coincided with the provision of the letter and the Agreement. To my mind, nothing of relevance turns on the fact the applicant did not sign the Agreement (which was referred to in the applicant's submissions as the "Ambush Document"), even when followed-up about the matter of signing that document."
[7] The Commissioner noted that the Company relied on the Agreement in aid of its submission that there had been no dismissal at the initiative of the Company. The Commissioner found that, notwithstanding that the Agreement was "...replete with clauses asserting that a host employer-determined cessation of the labour hire placement means that there is agreement this does not amount to a dismissal by the respondent",[4] those provisions did not alter the fact of the termination of the Appellant's employment at the initiative of the Company in this matter.
[8] The Commissioner noted that the Agreement identified the Clerks - Private Sector Award 2010 (the Clerks Award) as covering the employment, and also referred to enterprise agreement-related considerations, but found that the Appellant's employment was not covered by the Clerks Award as he was employed by the Company to undertake data analyst duties for the DVA. She found the duties of that position within the DVA were not of the clerical and administrative type envisaged in the Clerks Award.[5]
[9] The Commissioner noted that the Appellant submitted he was otherwise covered by any one or more of the following awards: the Professional Employees Award; the Market and Social Research Award; the Health Professionals and Support Services Award; and/or the Banking, Finance and Insurance Award.[6] In relation to these contentions, the Commissioner found:[7]
"The Professional Employees Award is an industry and occupational award and, by operation of cl.4.5, it covers "any employer which supplies on-hire employees in classifications set out in Schedule A - Classification Structure and Definitions and those on-hire employees, if the employer is not covered by another modern award containing a classification which is more appropriate to the work performed by the employee". The work or occupations described in Schedule A of the Professional Employees Award do not, in my view, comprehend the data analyst position/work of the applicant at DVA at a level undertaken by the applicant.
There is no basis upon which it could be concluded that the applicant was otherwise covered in his employment by the respondent and undertaking data analyst duties for DVA that he was covered by the Market and Social Research Award, the Health Professionals and Support Services Award or the Banking, Finance and Insurance Award; upon a reading of them, these awards are simply not apposite - and this is so notwithstanding my consideration of the applicant's submissions concerning purported coverage."
[10] As to the Appellant's submission that the DVA Enterprise Agreement 2019-2022 applied to his employment, the Commissioner found that the enterprise agreement covered the DVA (on behalf of the Commonwealth) and non-SES employees of the DVA employed under the Public Service Act 1999. It did not cover the Appellant, and the enterprise agreement did not apply in relation to the Appellant's employment with the Company in his placement at the DVA.
[11] The Commissioner referred to s.382(b)(iii) of the Act, observing that the high-income threshold in the period 1 July 2019 to 30 June 2020 was $148,700.00. The Commissioner noted that the Appellant's income was identified in the letter from the Company dated 28 May 2019 concerning the assignment at the DVA, which had an anticipated duration from 29 May 2019 to 30 June 2020 (with the possibility of an extension), as:[8]
"Your gross casual hourly rate will be $100.00 plus 9.5% superannuation. Your gross casual hourly rate is made up of the following: $80 plus 25% casual loading ($20) = $100.00. Your standard working week is 40 hours, if you are required to work more than 10 hours a day or 40 hours per week you must obtain your manager's prior approval."
[12] The Commissioner concluded that at the date of the dismissal, the Appellant's income was $100.00 an hour (exclusive of superannuation) multiplied by the standard work hours specified at 40 hours a week, and so as at the date of the dismissal, the Appellant's income from his employment with the Company was $4,000.00 a week or, multiplied by 52 weeks to be $208,000.00 annualised. She found that that amount exceeded the relevant high-income threshold amount of $148,700.00, and so the Appellant was not protected from unfair dismissal - and the application must therefore fail.[9]
[13] The Commissioner specifically noted that she was cognisant of the evidence that the Appellant did not, over the course of his placement at the DVA, necessarily or routinely work 40 hours a week and took periods of unpaid leave, though the basis for some of those absences were unclear. The Commissioner found nonetheless that, as at the date of dismissal, had the Appellant worked what was described as the "standard working week" and received his rate entitlement of $100.00 an hour, that took him beyond the high-income threshold when annualised. The Commissioner referred to a Full Bench decision in Zappia v Universal Music Australia Pty Limited T/A Universal Music Australia[10], as well as to the decisions of Vice President Hatcher in Darling v Bechtel Australia Pty Ltd[11], and Vice President Catanzariti in Cross v Bechtel Construction (Australia) Pty Limited.[12]
[14] The Appellant's Notice of Appeal identified nine grounds of appeal. Those grounds were refined in the Appellant's Outline of Submissions in the Appeal, resulting in a contention of three errors in the Decision, being the determinations that:
(a) The Letter of Appointment and the Agreement recorded the terms of the employment between the Appellant and the Company;[13]
(b) There was no modern award or agreement that covered the employment of the Appellant; and
(c) The Appellant annual rate of earnings exceeded the relevant high-income threshold amount of $148,700.00, and so the Appellant was not protected from unfair dismissal.
[15] The notice of appeal also contends a denial of procedural fairness arising from the circumstances in which the Commissioner came to determine the matter and apprehended bias. Neither of these matters was raised in the Appellant's written submissions nor during the oral hearing. Neither contention is seriously arguable, and we do not propose to deal with these grounds further.
[16] In relation to permission to appeal, the Appellant contended that the matters of public interest for the Commission were:
(a) The patent non application of award coverage, where award coverage is clear and undisputable.
(b) the effect of post-employment agreement document (ambush agreement), whose sole purpose is to exclude employment arrangement from the jurisdiction of the Fair Work Commission.
(c) the effect of s.332(2)(a) of the Act in determining a casual's wage.
[17] The Appellant also sought to rely upon what he described as additional evidence in the appeal. By email to the Commission dated 10 November 2020, the Appellant outlined five documents constituting additional evidence he sought to rely on as follows:
I am seeking to bring on additional evidence which was not available at the time of the hearing due to coivd (sic) 19 restrictions.
1) internal DVA email describing the job as a Data Engineer produced as a result of an FOI request.
2) DVA work order describing the job as a Data Engineer produced as a result of an FOI request.
3) A Canberra Times article dated 30 /10/2020, documenting sworn evidence to a senate committee by an agency head, on the applicability of the Public Service ACT, to labour hire engaged staff.
4) A Canberra Times article dated 28 /10/2020, documenting the number of persons adversely affected by the original decision of Commissioner McKenna.
5) a 1 page dissertation on the evolution of job titles within the information technology profession over the past 40 years.
[18] On 1 December 2020, in two separate emails, the Appellant attached three further documents being:
(a) A Seek.Com search for all Data analyst Information & Communication Technology Jobs in All Australia;
(b) A Seek.Com search for all Data engineer Information & Communication Technology Jobs in All Australia; and
(c) An undated advice from the Fair Work Ombudsman regarding a Nurse employed by Adecco Australia Pty Ltd based in Perth.
[19] An appeal under s.604 of the Act is by way of rehearing, however the Commission's powers on appeal are only exercisable if there is error on the part of the primary decision-maker.[14] An appeal may only be made with the permission of the Commission. This appeal is one to which s.400 of the Act applies. Section 400 provides:
"(1) Despite subsection 604(2), the FWC must not grant permission to appeal from a decision made by the FWC under this Part unless the FWC considers that it is in the public interest to do so.
(2) Despite subsection 604(1), an appeal from a decision made by the FWC in relation to a matter arising under this Part can only, to the extent that it is an appeal on a question of fact, be made on the ground that the decision involved a significant error of fact."
[20] In Coal & Allied Mining Services Pty Ltd v Lawler and others,[15] a Full Court of the Federal Court characterised the test under s.400 as 'stringent'.
[21] The fact that the Member at first instance has made an error is not necessarily a sufficient basis for the grant of permission to appeal in the public interest.[16] The task of assessing whether the public interest test is met is a discretionary one involving a broad value judgment.[17] In GlaxoSmithKline Australia Pty Ltd v Makin, a Full Bench identified some of the considerations that may attract the public interest:
"[26] Appeals have lain on the ground that it is in the public interest that leave should be granted in the predecessors to the Act for decades. It has not been considered useful or appropriate to define the concept in other than the most general terms and we do not intend to do so. The expression 'in the public interest', when used in a statute, classically imports a discretionary value judgment to be made by reference to undefined factual matters, confined only by the objects of the legislation in question. [Comalco v O'Connor (1995) 131 AR 657 at p.681 per Wilcox CJ & Keely J, citing O'Sullivan v Farrer [1989] HCA 61; (1989) 168 CLR 210]
[27] Although the public interest might be attracted where a matter raises issues of importance and general application, or where there is a diversity of decisions at first instance so that guidance from an appellate court is required, or where the decision at first instance manifests an injustice, or the result is counter intuitive, or that the legal principles applied appear disharmonious when compared with other recent decisions dealing with similar matters, it seems to us that none of those elements is present in this case."[18]
[22] In determining whether permission to appeal should be granted, it is unnecessary and inappropriate for the Full Bench to conduct a detailed examination of the grounds of appeal.[19] However, it is necessary to engage with the appeal grounds to consider whether they raise an arguable case of appealable error.
[23] Otherwise, the grounds for granting permission to appeal include that the decision is attended with sufficient doubt to warrant its reconsideration or that substantial injustice may result if leave is refused.[20]
[24] The appeal in this matter raises an issue of importance and general application involving the application of the high-income threshold to a casual employee working irregular hours, and we are persuaded that it is in the public interest to grant permission to appeal.
[25] Section 607(2) provides that the Full Bench can admit, and take into account, further evidence on appeal, but the admission of further evidence is discretionary and may be refused, particularly where such evidence could have been admitted at first instance. In Brazilian Butterfly Pty Ltd v Charalambous[21], the Full Bench observed, in relation to a previous legislative scheme:
"...The power to admit further evidence pursuant to s 45(6) is discretionary. That discretion, like all such discretions, must be exercised judicially in the interests of justice. The interests of justice are not confined to the interests of the parties but extend to include the broader public interest in the proper administration of justice. The principles governing the admission of fresh evidence on appeal in the courts are informed by important considerations of public policy including the vital public interest in the finality of litigation. Those principles provide a proper guide for the exercise of the discretion to admit fresh evidence pursuant to s 45(6). Halsbury's Laws of Australia summarises the position at common law as follows:
'Before such evidence will be received, the court must be satisfied that:
(1) the evidence could not have been obtained with reasonable diligence for use at the trial, unless the party against whom the evidence is sought to be admitted has been guilty of fraud;
(2) the evidence is such that there is a high degree of probability that the result of the proceeding below would have been different had it been received at the trial; and
These requirements are cumulative. While the second and third requirements are certainly satisfied, the first requirement is not satisfied in this case. We are not persuaded that the discretion to admit fresh evidence ought be exercised in favour of the employer, particularly in the absence of any explanation for failure to lead the further evidence before the Commissioner - evidence that was certainly available to be led at that time."
[26] We are not satisfied that the new evidence should be admitted in the appeal. Except for the newspaper articles, the evidence was available to the Appellant at the time of the hearing at first instance, and there is no probability that it would have resulted in a different outcome. While it is correct to observe that some of the documentation became available to the Appellant after its production on a Freedom of Information request that was satisfied after the hearing at first instance, those documents could also have been sought by way of Orders for Production made by the Commission prior to the original hearing. Similarly, the Seek searches and Fair Work Ombudsman application could have been completed earlier. The admission of the new evidence would not be consistent with the usual principles for the admission of new evidence on appeal or the policy consideration underlying them.
[27] As noted by the Full Bench in Harvey v Australian Injecting & Illicit Drug Users' League,[22] an "appeal bench would not usually admit evidence which could have been called at first instance. That approach is grounded in an important policy consideration, namely, that an appeal should not be an opportunity for parties to remedy avoidable deficiencies in the evidence" adduced in the proceedings.
(a) The Letter of Appointment and the Agreement Recording the Terms of Employment
[28] The Appellant's contention that his employment with the Company commenced on a date earlier than when the Agreement was provided to him is inconsistent with the chronology of the establishment of that employment relationship.
[29] The Company was contacted by the DVA and asked to recruit Data Analysts to work in its Data and Analytics Work Stream on a casual labour-hire basis on 10 April 2019. As the Appellant had not previously worked for the Company there was a period during which various correspondence was exchanged, and security checks were undertaken. While the Appellant responded to the Company's advertisement on 11 April 2019, security checks occurred thereafter culminating in a police check on 23 May 2019. It was not until 28 May 2019, that the Company wrote the Letter of Appointment to the Appellant welcoming him and thanking him for accepting the temporary assignment with the DVA. That letter annexed the Agreement, and the Appellant commenced his temporary assignment with the DVA on 29 May 2019.
[30] There was no error in the Commissioner concluding that the Letter of Appointment and the Agreement set out the terms and conditions of employment between the Appellant and the Company.
[31] The Appellant criticised the quality and amount of evidence provided to the Commission regarding his duties as a Data Analyst. He submitted that there was a "catastrophic misunderstanding" of what the duties of a Data Analyst entail. However, such criticism ignores the fact that the burden of establishing that he was protected from unfair dismissal at the time he was dismissed rested upon the Appellant. This relevantly included the need to lead evidence, that a particular award or agreement covered his employment at that time. Indeed, the Commission was not assisted, either at first instance or on appeal, by the Appellant's submission that one of six identified awards or agreements must cover his employment, without any more specific refinement.
[32] At first instance, the Appellant noted that the Company, in its submissions and evidence, were relying on the work order from the DVA to the Company. In response, the Appellant deposed in his statement in reply the following:[23]
"I Note SOS Recruitment are relying on the work order description of my role as: -
It is clear is clear (sic) that the respondent does not understand what it means. On my arrival, I was informed I was a Data Engineer. My employment label was quite fluid. Either of two disciplines fall into the ICT domain, and fall within some 5 awards.
So, what did I do while engaged, did I Visual Data? no.
I was tasked to work on the Hospital Coding Audit.
This work at a basic level, was to go through invoices received by DVA, check the supplier ID was a valid id supplier ID, it had a valid service code, and a valid client ID. I was required to retain and pass onto MHS, invoices that covered periods around a client's hospital admission records, including 12 weeks before and after admission. This activity, involved typing, calculating and checking the accuracy of invoices.
To perform this work on an industrial scale I was required to use my skills as a degree qualified information technology employee with sufficient qualifications and experience to become a Certified Professional of the Australian Computer Society. This involved designing software, system analysis, computer programming, maintaining the abovementioned computer systems and computer consultancy services, between the computerised activities there were various manual steps, which I completed personally.
I also believe this work could be characterised as social research, including both qualitative and quantitative research, for public or private purposes."
[33] As is apparent, the above extract contains a number of submissions, but the factual assertions made, particularly involving designing software, system analysis, computer programming, and maintaining computer systems, seem to be broadly consistent with the work order from the DVA. That work order was summarised by the Commissioner in her Decision, correctly in our view, as follows:[24]
"The position was described by DVA in its work order with the respondent as being "Data Analyst at an [Australian Public Service Executive Level 1] equivalent level". The advertised duties were otherwise set out in the evidence, namely, that mandatory and/or desirable skills and qualifications included:
• experience in preparing data for analytics purposes using existing datasets;
• experience in visualising complex datasets using business intelligence software such as tableau or Power BI;
• experience in using SQL and database solutions;
• demonstrated knowledge of developing procedures for data quality check;
• extensive experience with principles and practices of developing regular reports;
• skills in connecting and interpreting data; and
• proven high level of proficiency in building and developing SAS macros;
• experience in working alongside teams within the business to establish business needs;
• prior experience in supervising and mentoring junior staff; and
[34] The Appellant submitted that the Commissioner "provided no reasons for forming her view, let alone any evidence to support her view", that the Professional Employees Award did not cover his employment. He further submitted that "...due to the total lack of evidence the Commissioner erred and the Full Bench should find [the] applicant was covered by the Professional Employees Award if not covered by another Award." He described the Professional Employees Award as a "catch all award". The Appellant submitted that he was either a level 2 or 3 within the classifications listed in Schedule A of that Award, but certainly not a level 4.
[35] Contrary to the Appellant's submission, the Commissioner at paragraph [85] of the Decision clearly identified her reasons for concluding that the Professional Employees Award did not cover his employment. She noted the duties were outlined in the DVA work order, which we have found to be broadly consistent with the Appellant's own contentions. The Commissioner also observed the Professional Employees Award is an industry and occupational award, and that the work or occupations described in Schedule A of the Professional Employees Award did not comprehend the data analyst position or duties of the Appellant.
[36] We see no error in the Commissioner's conclusion regarding the Professional Employees Award, which was clearly available having regard to the delineation of the role and responsibilities of the position as set out in that work order together with the Appellant's own contentions, and have not been directed to any evidence that would point to a contrary conclusion.
[37] While the Agreement provided the Appellant would "... be paid as a casual on-hire employee under the Clerks - Private Sector Award 2010 ('the Award')", this statement cannot convey actual coverage where none exists. The duties of the Appellant's position within the DVA were not of the clerical and/or administrative type envisaged in the Clerks Award, and the Commissioner was correct in her conclusion that the Appellant was not covered by the Clerks Award.
[38] The Appellant has variously claimed that his employment was covered by the Health Professionals and Support Services Award, the Banking, Finance and Insurance Award, the Market and Social Research Award, the Australian Public Service Enterprise Award and the Australian Government Industry Award 2016, with each claim relating to the industry and activities of the DVA, and not the Company. It is abundantly clear that the Appellant was employed by the Company, and not the DVA. His unfair dismissal application is bought against the Company. The claims for alternate award coverage, relating as they do to the DVA and not the Company, are baseless.
[39] The Appellant also submitted that the Commissioner failed to provide any reasons for forming her view that no other award covered his employment. That criticism is not entirely correct as the Commissioner noted she had read the other awards advanced as possibly covering the Appellant and found they were "simply not apposite".[25] While not detailed reasons for decision, we consider that the Decision makes sufficiently clear the basis upon which the Commissioner decided the matter and has allowed the Appellant a proper opportunity to exercise his appeal rights.[26]
[40] Section 382 (b) of the Fair Work Act 2009 (the Act) provides that for a person to be protected from unfair dismissal one or more of the following must apply:
(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."
[41] At the time of the Appellant's dismissal (28 February 2020) the high-income threshold was $148,700.00 per annum.
[42] In relation to earnings, s.332 of the Act provides that:
(b) amounts applied or dealt with in any way on the employee's behalf or as the employee directs; and
(c) the agreed money value of non-monetary benefits; and
(d) amounts or benefits prescribed by the regulations.
(2) However, an employee's earnings do not include the following:
(a) payments the amount of which cannot be determined in advance;
(c) contributions to a superannuation fund to the extent that they are contributions to which subsection (4) applies;
Note: Some examples of payments covered by paragraph (a) are commissions, incentive-based payments and bonuses, and overtime (unless the overtime is guaranteed).
(3) Non-monetary benefits are benefits other than an entitlement to a payment of money:
(a) to which the employee is entitled in return for the performance of work; and
(b) for which a reasonable money value has been agreed by the employee and the employer;
but does not include a benefit prescribed by the regulations.
(4) This subsection applies to contributions that the employer makes to a superannuation fund to the extent that one or more of the following applies:
(a) the employer would have been liable to pay superannuation guarantee charge under the Superannuation Guarantee Charge Act 1992 in relation to the person if the amounts had not been so contributed;
(b) the employer is required to contribute to the fund for the employee's benefit in relation to a defined benefit interest (within the meaning of section 292-175 of the Income Tax Assessment Act 1997) of the employee;
(c) the employer is required to contribute to the fund for the employee's benefit under a law of the Commonwealth, a State or a Territory.'
[43] The Appellant submitted that the Commissioner erred in using the multiplier of 40 hours a week as his standard work hours because of the 40 weeks that he worked at the DVA, there were eight weeks where he worked no hours, and thirteen weeks where he did less than 40 hours work, with most of those thirteen weeks recording less than 30 hours of work.
[44] The Appellant submitted that as his weekly hours were not fixed, his annual rate of earnings could not be determined "in advance" (s.332(2)(a)) by use of the 40 hours a week multiplier, and the better guide to his income was to look at the pattern of hours worked to establish his rate of earnings, being approximately 27 hours a week, or $140,600.00 per annum. The Appellant noted that clause 45 of the Agreement provided that exact work hours were to be agreed between his manager and himself.
[45] In Zappia[27], a Full Bench of Fair Work Australia considered the term "annual rate of earnings". Referring first to the conclusion of SDP Hamburger at first instance, the Full Bench observed:[28]
"His Honour dealt with the annual rate of earnings aspect thus:
[9] ... The most natural way of construing the expression annual rate of earnings in s.382 is by reference to the annual rate of earnings at the time of the applicant's dismissal. If Parliament had wished to refer to the average amount earned over the previous 12 months it could easily have done so. I note, for example, that in setting the compensation cap in relation to unfair dismissal, s.392 specifically refers to the amount that the employee received (or was entitled to) during the 26 week period immediately before the dismissal."
[46] The Full Bench went on to conclude:[29]
"...In our view his Honour was clearly correct. Section 382 of the Act relevantly provides that a person is protected from unfair dismissal at a time if, at that time, 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. It is clear that the time at which the annual rate of earnings must be ascertained is at the time of the termination of the person's employment. What needs to be ascertained is the annual rate of earnings at that time, not the annual earnings to that time (the amount earned in the 12 months to that time).
[47] The Letter of Appointment related specifically to the temporary assignment of the Appellant with the DVA. It clearly specified the casual hourly rate of $100, and the standard working week of 40 hours a week. That the Appellant did not in fact work 40 hours each week was due to the Appellant's choice. The Appellant's absences for various periods occurred after he had notified the Company of such absences. In his reply evidence, the Appellant stated:
"Variations hours alluded to by Mr Milligan, were not due to any direction to reduce or not attend work by DVA, I received not informal direction from DVA nor do I believe SOS recruitment received any request to vary my hours."[30]
[48] During the hearing of the appeal the Appellant contended that he was in fact aware of the high-income threshold at the time of his employment and was taking unpaid leave during that employment so as to ensure he remained under that threshold. Whatever else might be said of this submission, it is at odds with his award covered contentions, since the high-income threshold only becomes relevant if an employee is not, at the time of dismissal, covered by an award or enterprise agreement. The notion that the Appellant was at the same time award covered and mindful of the high-income threshold thus varying his working hours, is to be polite, difficult to accept.
[49] In any event as the Full Bench observed in Zappia, what needs to be ascertained is the annual rate of earnings at that time of the termination of the person's employment, not the actual annual earnings to that time. The Letter of Appointment was clear as to rate of pay and standard working week, and the calculation of the Appellant's annual rate of earnings by the Commissioner as being $208,000.00 was correct and unexceptional. That the Appellant took unpaid leave does not affect in any way the calculation of his annual rate of earnings.
[50] The interpretation advanced by the Appellant would lead to absurd results. For example, in Cross v Bechtel Constructions (Australia) Pty Ltd [31], Vice President Catanzariti considered the application of the high-income threshold to an employee who had been on unpaid leave due to medical reasons for approximately fifteen months prior to his termination. There was no suggestion in that matter that time on unpaid leave affected the calculation of the employees annual rate of earnings, and the focus was on the whether the Applicant would have been paid regular overtime prior to being off sick[32], but the interpretation advanced by the Appellant would result in such an employee falling below the high-income threshold no matter what their income.
[51] For the reasons given the Appellant has not persuaded us of any appealable error in the Decision. The appeal is dismissed.
S Masters, solicitor, on behalf of the respondent
[1] [2020] FWC 4684, PR722422, and PR723077.
[2] Supplementary statement of Paul Dirkis of 26 June 2020, at [8].
[14] See Coal and Allied v AIRC [2000] HCA 47; (2000) 203 CLR 194 at [17].
[15] [2011] FCAFC 54 at [43], per Buchanan J, Marshall and Cowdroy JJ concurring.
[16] Lawrence v Coal & Allied Mining Services Pty Ltd, 202 IR 388 at [28], affirmed on judicial review in Coal & Allied Mining Services Pty Ltd v Lawler [2011] FCAFC 54.
[17] O'Sullivan v Farrer [1989], HCA 61, per Mason CJ, Brennan, Dawson and Gaudron JJ; applied in Hogan v Hinch [2011] HCA 4, at [69]; Coal & Allied Mining Services Pty Ltd v Lawler and others [2011] FCAFC 54, at [44]-[46].
[19] Trustee for The MTGI Trust v Johnston [2016] FCAFC 140 at [82].
[20] Esso Australia Pty Ltd v AMWU; CEPU; AWU [2015] FWCFB 210 at [7].
[21] (2006) 155 IR 36, at [18] and [19].
[22] [2007] AIRCFB 230 at [18].
[23] Statement of Paul Dirkis dated 12 June 2020, at [63] to [69].
[26] Inner West Towing Pty Ltd v David Maynard [2017] FWCFB 757, at [26].
[30] Statement of Paul Dirkis of 12 June 2020, at [74].
Printed by authority of the Commonwealth Government Printer
Paul Dirkis
Staffing and Office Solutions Pty Ltd T/A SOS Recruitment [2021] FWCFB 154
(2000) 203 CLR 194
(2006) 155 IR 36
(1989) 168 CLR 210