Andrew Forkes v Amristar Solutions Pty Ltd

[2016] FWC 5913

[2016] FWC 5913

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

Andrew Forkes
v
Amristar Solutions Pty Ltd
(U2016/2674)

COMMISSIONER WILSON MELBOURNE, 22 AUGUST 2016

Application for relief from unfair dismissal - jurisdictional objection - high income threshold - whether Applicant an employee or independent contractor - objection upheld - application dismissed.

[1] This decision deals with the question of whether Andrew Forkes is entitled to make an application for unfair dismissal against Amristar Solutions Pty Ltd. The issues in contention include whether Mr Forkes was employed by Amristar Solutions or whether he was engaged as an independent contractor through a private company of his and, in the event that he was an employee, whether he earned more than the high income threshold provided for in the Fair Work Act 2009 (the Act).

[2] As to whether or not Mr Forkes was an employee of Amristar Solutions, the evidence is that he performed work for the Respondent in some capacity from 5 August 2013 until 16 May 2016.

[3] The evidence also includes that Mr Forkes, or his company, did not undertake work for the Respondent within Australia, but rather that the work in its entirety was performed from the United Kingdom. Despite that situation no dispute has been put forward by the Respondent that the Act is incapable of applying to Mr Forkes, such as for reason that employment, if it were to be found, was not as a national system employee as that term is defined within s.13 of the Act.

[4] Within this decision, I find that if Mr Forkes was an employee, he was not covered by a modern award or enterprise agreement and that his annual rate of earnings was greater than the high income threshold. Accordingly, to the extent that Mr Forkes’ relationship with Amristar Solutions was that of a contract of employment, he was not at the time protected from unfair dismissal.

[5] Because of that finding, it is not necessary for me to consider and resolve the question of whether the relationship between Mr Forkes and Amristar Solutions was a contract of employment.

Legislation

[6] A person is protected from unfair dismissal in the circumstances set out in s.382 of the Act;

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

(b) one or more of the following apply:

(i) a modern award covers the person;

(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.

[7] Section 380 provides that, for the purposes of Part 3-2 of the Act, dealing with unfair dismissal, an employee means a national system employee, which term is defined by s.13 to mean an individual employed by a national system employer, with the meaning of that term elaborated on in s.14 of the Act.

Background

[8] The evidence includes that Mr Forkes is an information technology professional with extensive experience in the field over a period of about 30 years. That work has been undertaken by him principally, but not exclusively, within the United Kingdom. In 1989 he obtained a British Higher National Certificate, the equivalent of an Australian vocational degree qualification. In the course of his career he has worked for significant corporate organisations in roles such as software engineer, software developer, software designer, object-oriented architect and Java architect. While he has worked as an employee, he has also worked as an independent contractor. Some years ago, he established his own company for that purpose, by the name of Familiar Ltd.

[9] Amristar Solutions is a Perth based company which develops and deploys software products for its customers and especially in the field of geographic information systems. One such product is a line known as Mapworks.

[10] A former Chief Executive Officer of Amristar Solutions, Gary Macbeth, offered an engagement to Mr Forkes in 2013 to perform work for the company, which offer was taken up by Mr Forkes. The material before the Commission includes several versions of a Consultancy Agreement, which on its face is a contract for services between Amristar Solutions and Familiar Ltd. While there are some differences in the evidence and submissions between the parties about whether consideration was given to whether the relationship between the two would be that of an employment relationship, the evidence resolves in favour of a finding that the parties proceeded on the basis that the Consultancy Agreement, as may have been mutually amended, governed their relationship. In particular, invoices were periodically issued by Familiar Ltd to Amristar Solutions and were then paid by the latter on the basis the claims were supplier invoices.

[11] The initial Consultancy Agreement referred to the consideration between the two being on the basis of AUD $5,000.00 per month. That amount was subsequently increased as a result of an agreement to do so between the parties. At least for the period for which invoices have been provided to the Commission, which is after June 2015, the monthly arrangement was significantly greater than $5,000.00 and the regularly invoiced amount was GBP £6554.16 (while noting that it was not always that amount).

[12] The Scope of Services which were set out in the initial Consultancy Agreement, dated 5 August 2013, is in the following terms;

“1 SCOPE OF SERVICES

The Consultant will be engaged to provide Andrew Forkes as the Approved Personnel, to act as Product Owner & Team Leader for products/projects as directed by company management. This engagement is subject to the Approved Personnel signing a deed regarding confidential information and intellectual property as approved by the Principal and provided separately to this Agreement.

As Product Owner/Team Leader, he Approved Personnel's scope of responsibilities includes:

• As Product Owner, you will guide a team that is charged with a product line contribution as a business unit; responsible for all business and technical deliverables to deliver product to market.



• Lead the end-to-end delivery of product to market, with responsibility for ensuring effective development and go-to-market functions for assigned products.



• Coordinate effort across the various business functions within the company to deliver and support products. (including Development, Operations, Marketing, Sales)



• As Team Leader in the Development function, manage the technical product development stage of assigned products.



• Drive the use of Agile development methodology within assigned projects.



• Provide appropriate mentoring to development staff as necessary to ensure effective adoption and execution of Agile.” 1

[13] The same Scope of Services then appears in another version of the Consultancy Agreement provided to the Commission. 2

[14] The arrangement between Mr Forkes, or his company, and Amristar Solutions came to an end on 16 May 2016 when two Directors of Amristar Solutions wrote to Mr Forkes terminating its requirement for services with immediate effect.

Consideration

[15] Given that the termination took place when it did, the applicable high income threshold is an amount of $136,700, being the threshold applicable from 1 July 2015.

[16] Amristar Solutions submitted, and Mr Forkes did not put an opposing position, that the total payments made by Amristar Solutions to Familiar Ltd by way of invoice between 19 June 2015 and 18 May 2016 were equivalent to AUD $163,187.37. While each invoice was presented as a claim in Great Britain Pounds, payment of each invoice was then effected by Amristar Solutions within two to three weeks with payment being made through an internet transfer. Amristar Solutions have provided in their material evidence of the Australian Dollar payment, which verifies the total amount of the payments.

[17] In the event that a modern award or enterprise agreement covered Mr Forkes, further consideration of the high income threshold would be unnecessary and it would instead be necessary to consider in detail whether the relationship between Mr Forkes and Amristar Solutions was that of a contract of employment or an independent contractor relationship.

[18] As a result I turn to consider whether a modern award or enterprise agreement may have covered Mr Forkes.

[19] Mr Forkes puts forward that, to the extent that he was an employee, a modern award covered him, being the Professional Employees Award 2010 3 (the Modern Award). No claim is made either by him or the Respondent that an enterprise agreement may have applied to the relationship, if it was an employment relationship.

[20] In support of his contention that the Modern Award applied to him, Mr Forkes submitted that he was an experienced information technology employee within the meaning of the Modern Award (clause 3.3); that he qualifies for membership of the Australian Computer Society; and that his position at Amristar Solutions is consistent with the classification descriptors of Level 4 – Professional, which are set out in Schedule B – Classification Structure and Definitions, at Clause B.1.11. Mr Forkes’ written witness statement on the subject sets out what he believed his duties to have been, with those matters being reinforced in his oral evidence;

“20. My position at Amristar falls within a Level 4 Professional as set out at Schedule B.1.11 for the Professional Employees Award

21 . My position as within Amristar Pty Ltd incorporated both a supervisory role and a hands-on engineering role. The role was split 40/60 between supervision and engineering. As a supervisor my duties included:

a. Defining the product roadmap in association with stakeholders (as per Schedule B.1.11.a and B.1.11.b.i of the Professional Employees Award)
b. Deciding how best to prioritise work (as per Schedule B.1.11.b.iv of the Professional Employees Award)
c. Facilitating the engineering team's needs (as per Schedule B.1.11.e of the Professional Employees Award)
d. Defining Processes and Practises to achieve objectives (as per Schedule B.1.11.b.i of the Professional Employees Award)

As an engineer my duties included:

a. Requirements gathering, specification and technical clarification (as per Schedule B.1.11.a of the Professional Employees Award)
b. Software architecture and technology review (as per Schedule B.1.11.c of the Professional Employees Award)
c. Software architecture, design & coding (as per Schedule B.1.11.e of the Professional Employees Award)
d. Software review, testing and quality assurance (as per Schedule B.1.11.e of the Professional Employees Award)
e. User Interface design (as per Schedule B.1.11.e of the Professional Employees Award)
f. Implementation of software automation infrastructure (as per Schedule B.1.11.e of the Professional Employees Award)
g. New technology exploration, investigation and review (as per Schedule B.1.11.b.v of the Professional Employees Award)” 4

[21] In considering the question of whether or not a modern award can cover Mr Forkes, it is necessary to have regard to the criteria set out by the Full Bench for determining whether or not a particular award applies to employment. In Carpenter v Corona Manufacturing, the Full Bench held that;

“... 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”. 5

[22] The Full Bench in Brand v APIR Systems Ltd elaborated on this test with the following;

“[13] We note that the Commissioner adopted and applied a test based on the principal purpose for which the applicant was employed. She relied upon the Full Bench decision in Carpenter v Corona Manufacturing Pty Ltd in that respect. An analysis of the authorities referred to in that case shows that industrial courts and tribunals have at different times adopted different formulations of the test to be applied in determining whether the work of an employee or group of employees is within a particular occupation or classification. One formulation requires that the question should be decided by reference to the major and substantial employment of the employee. Another formulation requires that the principal purpose or purposes of the employment be identified. In some cases the formulations have both been referred to. In one case a Full Bench of the Commission held that the principal purpose formulation was a refinement of the major and substantial employment formulation. A Full Court of the Federal Court of Australia, without reference to other authorities, adopted a test based on whether the employees were “engaged substantially” in the duties of the relevant occupation.” 6 (references omitted)

[23] In considering Mr Forkes’ circumstances, the evidence supports a finding that the work undertaken either by him or his company for Amristar Solutions was consistent with the matters set out in the Scope of Services of the consultancy agreement. Whereas Mr Forkes puts forward in his evidence that his role in software development was very hands-on, I consider that the evidence resolves in favour of the broader set of responsibilities set out within the Scope of Services.

[24] Analysis of the Scope of Services leads to a finding that the circumstances in which Mr Forkes was engaged were managerial in nature. His major and substantial engagement was to coordinate the activities of a team of people; to guide and motivate them to the contribution they were making to the company and to be responsible to the Chief Executive Officer for delivery of Amristar Solutions’ product objective. That is not to say that he was not working on professional information technology tasks; that he did not have to bring his information technology experience to the task; or even that it would be possible for him to perform his role without such experience.

[25] In all, while Mr Forkes was no doubt required to undertake information technology activities, and it would probably be surprising if he was not so required, the evidence does not lead to a finding that Mr Forkes was engaged substantially on work that would fall within the classification criteria set out within the Modern Award.

[26] Accordingly I find that the Professional Employees Award 2010 does not cover Mr Forkes in respect of the work he performed for Amristar Solutions.

[27] For the reason that Mr Forkes’ annual rate of earnings was greater than $136,700 he was not a person protected from unfair dismissal when his, or his company’s, services were terminated by Amristar Solutions.

[28] It is therefore unnecessary for me to consider whether the relationship was one of employment or an independent contractor.

[29] As a result I must now dismiss his application for unfair dismissal and an Order to that effect is issued at the same time as this decision.

COMMISSIONER

Appearances:

Mr A Forkes on his own behalf.

Ms C Sluiter of Allion Partners for the Respondent.

Hearing details:

2016.

Melbourne (by telephone):

August 10.

 1   Exhibit R2, Respondent’s Document List, Document 1.

 2   See Exhibit A1, Witness Statement of Andrew Forkes, Annexure A.

 3   MA000065.

 4   Exhibit A1 [20]-[21].

 5 (2002) 122 IR 387 [9], see print ref PR925731; followed by McMenemy v Thomas Duryea Consulting[2012] FWAFB 7184 [37].

 6   (2003) (unreported, AIRC (FB)), PR938031 [13].

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