Benjamin Norman v Fyfe Pty Ltd T/A Fyfe Earth Partners

[2014] FWC 7927

[2014] FWC 7927

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Benjamin Norman
v
Fyfe Pty Ltd T/A Fyfe Earth Partners
(U2014/10809)

COMMISSIONER HAMPTON ADELAIDE, 30 DECEMBER 2014

Application for relief from unfair dismissal - jurisdiction - whether applicant protected from unfair dismissal - employee paid beyond the remuneration cap for unfair dismissals - whether applicant covered by modern award - Professional Employees Award 2010 - Divisional Manager in consulting engineering business - whether performing professional engineering duties required by the position - whether work falling within classifications of the modern award - some engineering work performed - whether work required by the position - principal purpose test applied - genuine senior management role not falling within classifications of modern award - whether covered by Miscellaneous Employees Award 2010 - nature of position excluded from scope of award - not covered by any modern award - not protected from unfair dismissal - no jurisdiction - application dismissed.

1. Background and case outline

[1] Mr Benjamin Norman has filed an application for an unfair dismissal remedy under s.394 of the Fair Work Act 2009 (FW Act). His former employer and the respondent in these proceedings, Fyfe Pty Ltd T/A Fyfe Earth Partners (Fyfe) has raised a jurisdictional objection on the basis that the applicant is not protected from unfair dismissal.

[2] Section 382 of the FW Act 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

(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.”

[3] It is common ground that Mr Norman has completed the minimum employment period. It is also agreed that Mr Norman was not covered by an enterprise agreement and that his annual rate of earnings exceeded the high income threshold. As a result, Mr Norman will not be protected from unfair dismissal, and not eligible to bring this application, unless he was covered by a modern award.

[4] Mr Norman was employed as a Divisional Manager and holds relevant engineering qualifications. He claims to have been covered by the Professional Employees Award 2010 1(the Professional Employees Award), or in the alternative, the Miscellaneous Award 20102 (the Miscellaneous Award).

[5] Fyfe contends that Mr Norman was a senior manager within its business and was not covered by either modern award.

2. The evidence before the Commission

[6] The applicant provided a comprehensive witness statement and gave evidence in support of his case.

[7] Fyfe relied upon the evidence of the following managers, all of whom provided witnesses statements and gave oral evidence:

● Ms Kerry Cox - Group Human Resources Manager;
● Mr Phillip Verco - Director of Infrastructure;
● Mr Michael Bessen - Director of Energy and Resources Business Unit, Central and Western Australia; and
● Mr Mark Dayman - Managing Director.

[8] In general terms I found that each of the witnesses gave evidence truthfully and openly. However, I consider that Mr Norman was not convincing when attempting to justify the claimed extent of actual engineering work in the context of his recorded billable hours.

[9] I also find that some of Fyfe’s witnesses tended to downplay the extent of actual engineering work that was undertaken by Mr Norman, at least early on in his time with the employer.

[10] I also note that Fyfe did not lead evidence from any of the employees supervised by Mr Norman or from the recruitment agent whose reports on Mr Norman were relied upon to some extent. Only the first of these was of any potential significance given the direct involvement of Mr Dayman in the applicant’s recruitment.

3. Was Mr Norman covered by the Professional Employees Award 2010?

[11] It is appropriate to deal firstly with applicant’s primary contention that he was covered by the Professional Employees Award.

[12] The coverage clause of the Professional Employees Award 2010 relevantly provides:

“4. Coverage

4.1 This award covers employers throughout Australia with respect to their employees performing professional engineering and professional scientific duties who are covered by the classifications in Schedule B—Classification Structure and Definitions of the award and those employees.

4.2 This award covers employers throughout Australia principally engaged in the information technology industry, the quality auditing industry or the telecommunications services industry and their employees who are covered by the classifications in Schedule B.”

[13] The Professional Employees Award 2010 is expressed to cover parties in two ways. It covers employers in the industries specified in clause 4.2 but it also has an occupational coverage as specified in clause 4.1.

[14] The issue in this case is whether Mr Norman is covered by the Professional Employees Awardby virtue of its occupational coverage through clause 4.1.

[15] Clause 4.1 refers to the Award covering “employers throughout Australia with respect to their employees performing professional engineering and professional scientific duties” and it clear that either may be satisfied. Mr Norman relies upon the coverage of “professional engineering duties” as defined by the Professional Employees Award.

[16] There is a dispute about the nature of Mr Norman’s duties and as to whether he was covered by a classification in Schedule B to the Professional Employees Award.

[17] The expression “professional engineering duties” is defined in clause 3.2 of the Professional Employees Award as follows:

“professional engineering duties means duties carried out by a person in any particular employment, the adequate discharge of any portion of which duties requires qualifications of the employee as (or at least equal to those of) a graduate member of Engineers Australia.”

[18] It is common ground that although Mr Norman was not a graduate member of Engineers Australia, he held the relevant qualifications to do so. However, there is a dispute as to whether the qualifications were required as part of his position as Divisional Manager.

[19] Mr Norman relies in particular upon the classification set out as Level 4 - Professional in Schedule B of the Professional Employees Award.

[20] Schedule B to the Award relevantly read as follows:

“For employment involving the performance of professional duties, the following classification definitions apply:

B.1 Professional responsibility levels

[...]

B.1.11 Level 4—Professional

(a) An employee at this level performs professional work involving considerable independence in approach, demanding a considerable degree of originality, ingenuity and judgement, and knowledge of more than one field of, or expertise (for example, acts as their organisation's technical reference authority) in a particular field of professional engineering, professional scientific/information technology field or professional information technology field.

(b) An employee at this level:

(i) initiates or participates in short or long range planning and makes independent decisions on professional engineering or professional scientific/information technology policies and procedures within an overall program;

(ii) gives technical advice to management and operating departments;

(iii) may take detailed technical responsibility for product development and provision of specialised professional engineering or professional scientific/information technology systems, facilities and functions;

(iv) coordinates work programs; and

(v) directs or advises on the use of equipment and materials.

(c) An employee at this level makes responsible decisions not usually subject to technical review, decides courses of action necessary to expedite the successful accomplishment of assigned projects, and may make recommendations involving large sums or long range objectives.

(d) Duties are assigned only in terms of broad objectives, and are reviewed for policy, soundness of approach, accomplishment and general effectiveness.

(e) The employee supervises a group or groups including professionals and other staff, or exercises authority and technical control over a group of professional staff. In both instances, the employee is engaged in complex professional engineering or professional scientific/information technology applications.”

[21] It is common ground 3 that each of the elements of Level 4 must be met in order to fall within that classification.

[22] In Sanjay Halasagi v George Weston Foods Limited, 4 Lawler VP discussed the history of the Professional Employees Award, the proper approach to the interpretation of an award, and summarised his view in the following terms:

“[23] I proceed on the basis that:

• Particular duties will not be “professional engineering duties” as defined unless it is almost invariably the case that a qualification of the sort referred to in the definition is needed for the adequate discharge of some portion of those duties.

• The qualification must relate directly to the duties in question. That is, it is not enough that an employee holds a qualification as (or at least equal to those of) a graduate member of Engineers Australia, the qualification must be a qualification of the sort that is almost invariably needed to perform duties of the sort that are said to be the “professional engineering duties” of the employee. In other words, an employee would generally not be able to rely upon, say, a degree in mechanical engineering to claim coverage by the Professional Employees Award 2010 in a position that involves duties in the field of chemical engineering.

• If the advertisement for an employee’s position identifies a relevant qualification as required this would be prima facie evidence that the position involved “professional engineering duties” for an employee who held that qualification.

• The reference in the definition to “the adequate discharge of any portion of” the relevant duties is intended to ensure that engineers who advance in their career and assume an increasing load of administrative duties remain covered if they still perform some engineering duties, the adequate discharge of which requires the relevant qualification and the definition should be construed accordingly.

[24] Of course, an applicant who seeks to establish that they are protected from unfair dismissal by virtue of being covered by a modern award needs to establish not only they are within the coverage clause of that modern award (the issue with which I am presently concerned), but also that they are employed in a classification in the award. That later question is determined by reference to the “principal purpose” test. I would note that, in relation to the Professional Employees Award 2010, care must be taken not to confuse these two questions because the definition of “professional engineering duties” can be satisfied by reference to “any portion” of the employee’s duties and does not require that the duties falling within that definition are the “principal purpose” for which the employee is employed.”

[23] The principle purpose test referred to above has been discussed by a Full Bench of the Australian Industrial Relations Commission (AIRC) in R Brand v APIR Systems Limited. 5 That decision, in turn, cited the decision of the Full Bench of the AIRC in Carpenter v Corona Manufacturing Pty Ltd,6 which stated relevantly as follows:

“In our view, in determining whether or not a particular award applies to identified employment, more is required than a mere quantitative assessment of the time spent in carrying out various duties. An examination must be made of the nature of the work and the circumstances in which the employee is employed to do the work with a view to ascertaining the principal purpose for which the employee is employed. In this case, such an examination demonstrates that the principal purpose for which the appellant was employed was that of a manager. As such, he was not "employed in the process, trade, business or occupation of ... soliciting orders, obtaining sales leads or appointments or otherwise promoting sales for articles, wares, merchandise or materials" and was not, therefore, covered by the Award.” 7

[24] In Nicholas McMenemy v Thomas Duryea Consulting Pty Ltd T/A Thomas Duryea Consulting 8 a Full Bench of the Commission also referred to the above authorities and observed:

“[37] We comment in this regard that consistent with the decision of the Full Bench of the Australian Industrial Relations Commission (as it then was) in Carpenter v Corona Manufacturing Pty Ltd, an own employee’s estimation of the quantification of their workload is not determinative of the classification, if any, in an award, into which they might fall. One reason for this (and there will be more) is that an employee might perform duties (where they are not closely supervised) which the employee prefers, or believes to be required, but which are not the duties the employee is necessarily directed (or employed) to perform. This is why the Full Bench articulated the task of ascertaining the principal purpose of the employment as requiring “an examination of the nature of the work [...] the employee is employed to do”.”

[25] In McMenemy, the Full Bench also observed as follows in relation to the classification Level 4 under the Professional Employees Award:

“[63] The Award makes clear that the supervisory element of the duties is in a context in which the employee is engaged in “professional engineering or professional scientific/information technology applications”. The managerial duties of the New South Wales State Manager are not comprehended by the terms of the Award......”

[26] In Hehir v Schweitzer Engineering Laboratories Pty Ltd 9 (Hehir) Cloghan C observed as follows:

“[58] With very few exceptions, Mr Hehir’s status report related to project AU1023. The evidence contained in the status reports illustrates that, with few exceptions, these duties were what would be expected of a Project Manager and express clearly that his duties did not encompass the providing of professional engineering services. In my view, there is a distinction between carrying out the duties of a professional engineer, and a professional engineer using their knowledge, skills and experience in carrying out the roles and duties of another position, where that knowledge, skills and experience is of assistance. Despite this situation, Mr Hehir gave examples of why it was not possible or practical for the lead engineer to respond to customer needs and he would “attend meetings and have discussions”.

[59] Should there be any confusion, the fact that a person with an engineering qualification, knowledge, skills and experience is employed does not make the classification of their position, a professional engineer. The classification of a position is determined by the duties to be performed and the purpose of those duties performed. It is not the person (and their attributes) that denotes or designates the position nomenclature, but the duties required to be performed, and for what purpose, by the employer.”

[27] Whilst the circumstances of each case are different and require consideration, I would respectfully agree that the above approach is consistent with the application of the Professional Employees Award.

[28] The question of coverage of the modern award is to be determined at the time of the dismissal and having regard to the circumstances applying at that time. 10

[29] Mr Norman through his Counsel, Mr Manuel, contends that he was covered by the Professional Employees Award for reasons including:

● He supervised a team of professional engineers and related disciplines and the employer required him to hold a Bachelors degree to perform his role, and it knew that the only degree held was an engineering degree;
● He was recruited on the basis of his engineering ability and the recruitment consultant noted that he needed development in management and this confirms that the focus of his position was engineering and not management;
● The contract of employment requires him to ensure that there is the highest level of engineering services delivered to the clients;
● The letter of offer does not contain any information relating to the duties to be undertaken and he did actually perform high level engineering work as part of his position and this was required;
● The offer of shares as part of the remuneration package is not restricted to management positions; and
● He gave direct evidence about the actual work performed whereas the other Managers who provided evidence only made assertions based upon experience rather than direct knowledge.

[30] In relation to the coverage of the Professional Employees Award, Mr Norman also contends that:

● He does have the relevant qualifications as a professional engineer;
● These qualifications were required for a proportion of his duties in supervising engineering staff and in taking responsibility for projects and work, and it was not necessary that the qualifications be utilised regularly;
● The concept of “required” in this context was akin to the “inherent requirements” approach adopted in anti-discrimination law - could the work be undertaken without the requirements; 11

The supervision of professional engineers and his other work was sufficient to meet the principal purpose test; and

● He also replaced engineers when on annual leave and undertook the role of Design Manager upon the resignation of the incumbent.

[31] Fyfe, through its Counsel, Ms Charlesworth, contends that Mr Norman was not covered by the Professional Employees Award. In relation to the nature of his duties, it contends that:

● The fact that Mr Norman had qualified engineers under his supervision does not mean that he himself is covered by the Award;
● Mr Norman did not have any discussions with his immediate manager about any technical engineering issues;
● There was no direction from the employer that Mr Norman was to perform engineering work;
● The fact that Mr Norman performed some engineering duties on a limited basis, when certain employees were on leave, does not mean that his own duties equate to the other employees and he was not required to undertake these duties as part of his role;
● Mr Norman did not access, use or was issued with the relevant software programs that are used by engineering staff to perform their technical engineering work;
● Mr Norman only performed superficial reviews of work performed by his team and this related to procedural and budgetary compliance rather than confirmation of the engineering designs;
● Mr Norman was not required to undertake technical supervision and in his role as Divisional Manager he was responsible for supervising staff with a variety of tertiary qualifications;
● The previous Divisional Manager did not have formal engineering qualifications; and
● There was a clear distinction between the senior management and other roles within the organisation.

[32] In relation to the classification and principle purpose of Mr Norman’s position, Fyfe contends that:

● The duties set out in Schedule B were not the principal purpose for the role of Divisional Manager and Mr Norman’s employment;
● This is evidenced by his remuneration level;
● Mr Norman acknowledged that his role was to ensure the financial performance of his division, attract new clients and he wanted to obtain shares in the employers’ business;
● Mr Norman was not employed to perform “complex professional engineering applications”;

● At the time of the dismissal, there were other employees whose principal purpose was to perform these duties;
● Mr Norman’s performance was assessed against KPI’s. This is the strongest evidence to support Mr Norman’s principal purpose of employment; and
● The timesheet records of Mr Norman show little evidence of any technical engineering work being completed by him.

[33] Having regard to the evidence before the Commission I find as follows.

[34] Fyfe is an Adelaide based land resource and infrastructure development consulting company employing around 500 employees. It specialises in civil engineering, planning, surveying and related consultancy services. I also note that Fyfe is a combined business involving the merger of a number of entities and that Mr Norman was originally employed by a different entity. Nothing turns on that fact. It is however evident that the size and structure of the business changed during Mr Norman’s employment.

[35] Mr Norman was engaged within the Infrastructure Business Unit (IBU) of Fyfe’s operations. The IBU has a number of divisions and Mr Norman was the Divisional Manager for the SA Civil Division with that unit. At the time of dismissal, he reported to Mr Verco, the Director of Infrastructure, who in turn reported directly to the Managing Director, Mr Dayman.

[36] The IBU typically performs consulting engineering services ranging from major projects in the oil and gas sector to smaller projects in the context of residential developments, local government infrastructure and road works.

[37] Mr Norman was recruited to the position of Divisional Manager and commenced in October 2009.

[38] Mr Norman held the qualification of a Bachelor of Engineering (Civil) Honours and a Graduate Diploma in Project Management. He had extensive experience in urban development, including development management experience and the management of civil construction crews and projects. The report provided by the recruitment agency emphasised Mr Norman’s engineering skills and experience and noted that some development of management skills may be required.

[39] During the recruitment stage, Mr Dayman did, in effect, discuss with Mr Norman whether he willing to undertake some engineering work as part of any role. It is however apparent from the evidence as a whole that Mr Dayman saw Mr Norman as someone who could potentially build the civil engineering business by generating new clients and work.

[40] Mr Norman’s contract of employment did not specify the precise duties of the position. Various job descriptions that applied to Mr Norman and other Divisional Managers, during his employment confirmed the nature and principal function of the role. These focused upon business development, staff management, overall operational responsibility including delegating project management tasks and providing guidance on design issues and the preparation of reports for the Board

[41] In 2008, a position description 12 relevant to Mr Norman stated under “training requirements” that the training need was “Civil Engineering”, that the “activity” was a “Degree” and that this was required by company policy. This same document also included a KPI of personal chargeable time of around 60 percent. This document was still being used in 2010 however these aspects were not reflected in the subsequent job descriptions provided in the evidence

[42] In 2013, the position descriptions for the Divisional Managers were revised. The nature of the role was stated in the following terms:

“The Division Manager works with the section management team to ensure the Divisions day to day operations meet the requirements of the Fyfe business objectives, financial targets and the expectations of our clients.”

[43] The responsibilities canvassed the following key result areas:

● Health, Safety and Environment;
● People Management and Development;
● Operations;
● Business Development;
● Customer Service; and
● Innovation and continuous improvement. 13

[44] The desirable qualifications were expressed to be Bachelor degree in Engineering; Surveying; Management or other relevant discipline.

[45] I find that this accurately described Mr Norman’s position at the time of his dismissal although it was a generic description and did not necessarily canvass all of the detailed requirements of the position that might vary between Divisional Managers.

[46] Mr Norman managed in the order of 20 staff, with seven or more of whom were qualified engineers. It is evident that the staff of the division were expected to provide the technical expertise and that Fyfe added to the number of employees with technical expertise during Mr Norman’s time as the Divisional Manager because he was not expected to undertake those roles as part of his position. 14 This was particularly evident in the latter years of his employment where almost all of the emphasis in the requirements and expectations were around high level management, business development and financial accountability.

[47] At the time of his dismissal, Mr Norman’s salary was $210,525 plus superannuation. In addition to salary, Mr Norman held the right to purchase shares as part of an employee share scheme. Although employee shares may be available more generally, in Mr Norman’s case, this was part of an offer made to the “senior executive team”. 15

[48] The key performance indicators relevant to Mr Norman’s position included at various times revenue, client retention, improved profile, larger and better projects. The measures included the number of tenders submitted, the undertaking of projects within budget and timeframes, attendance at networking functions, clients feedback and observed behaviours appropriate for a senior leadership role. 16 These are consistent with an employee whose primary function was to increase the client base and profitability of his division. That is, business development and the management of the staff and services.

[49] Mr Norman did do some engineering work. This included some design work, giving formal sign-off (certification) for certain documents and proposals, the development of a safety and design procedure, taking over the completion of a project when the technical officer retired, and some limited backfilling for absent engineers. Mr Norman also undertook the role of Design Manager for a period in the absence of an employee to fill that role. Some of this occurred because he had the relevant qualifications however there was also a sense in which a Divisional Manager with those qualifications would naturally undertake those roles. There is also some evidence that at least early after accepting his position with Fyfe, Mr Norman’s status as an engineer was seen as important as a project leader. 17

[50] Mr Norman would be designated as a Project Manager on certain projects however he was more commonly appointed as a Project Director. High-level project management was considered by Fyfe to be chargeable work when undertaken by Mr Norman and other Divisional Managers. 18

[51] Mr Norman did also provide some engineering advice and information to clients. However, I am also satisfied that Mr Norman has overstated the degree of actual engineering work involved and the supervision and sign-off of work did not involve the extent of such work as claimed. This arises in part because of the disconnect between the stated engineering work and the time recorded and/or charged for such work and the balance of the evidence about what he actually did in relation to some of those projects.

[52] Mr Norman also sat on a number of industry or university advisory committees representing Fyfe. This was done as part of his role to lift the profile of the company and to facilitate the recruitment of engineers.

[53] In the lead up to the dismissal, Fyfe had raised concerns with Mr Norman about his record keeping, and the time sheets used to generate client charges, in particular. In most circumstances this would be indicative of an employee undertaking direct hands-on work. However, in the case of the Divisional Managers, management time was considered chargeable if it involved project management or related high-level work.

[54] Turning to the operation of the coverage provisions of the Professional Employees Award, it is clear that Mr Norman must satisfy the Commission that he was undertaking professional engineering duties as defined. He must also satisfy the Commission that his position falls within one or more of the classifications of the Professional Employees Award.

[55] I have found that Mr Norman did from time to time undertake engineering work for which his qualification was required. This does not mean that the qualification was required as a matter of course in the position of Divisional Manager as occupied by Mr Norman. This is clear from the basis upon which the position was filled and how it was conducted. I also note in that regard that Mr Norman’s position was occupied at various times by managers who did not hold the engineering qualifications. There is no indication that the position of Divisional Manager was substantively different when undertaken by those other managers. The fact that Mr Norman undertook that work was much more a reflection of the fact that he held the qualifications and could do the work rather than a result of a requirement to do the work by virtue of his position.

[56] In any event, a full consideration of the nature of Mr Norman’s position and work reveals that he was not engaged in complex professional engineering or professional scientific/information technology applications. He did not have access to the necessary software to perform most of this work. Rather, the fundamental nature of his role was to gain and develop clients and to supervise the staff of the division, some of whom were engineers. The weight of the evidence is that he was fundamentally supervising the staff at a general level and not involved in detailed engineering work and did not have access to or utilise specific engineering technology applications.

[57] The focus of his position is represented in the position description and in the KPIs applied to Mr Norman. These all point towards the substantive focus and principal purpose as being senior management and business development rather than engineering. His salary package, although not relevant in its own right, is also consistent with these findings.

[58] Mr Norman was not substantively an engineer undertaking a management role, he was fundamentally a senior manager who also did some engineering work given his particular qualifications as a minor part of his work. This is very much akin to the circumstances found in Hehir.

[59] Although not decisive in themselves, the fact that discussions and directions between Mr Norman and his manager, and the issues raised during the performance appraisal exercises, did not touch upon any technical or operational engineering matters, is consistent with the above findings.

[60] Accordingly, even if undertaking professional engineering duties as defined, he was not performing a role falling within Level 4 provided by the Professional Employees Award.

[61] Although not seriously contented by Mr Norman as being applicable, I have also considered the lower classifications with the Professional Employees Award. These do not relate to the nature of responsibilities, work or role undertaken by Mr Norman.

[62] As a result, I find that Mr Norman was not covered by the Professional Employees Award.

4. Was Mr Norman covered by the Miscellaneous Award 2010?

[63] The coverage of the Miscellaneous Award is set out in clause 4 as follows:

“4. Coverage
4.1 Subject to clauses 4.2, 4.3, 4.4, 4.5 and 4.6 this award covers employers throughout Australia and their employees in the classifications listed in clause 14—Minimum wages who are not covered by any other modern award.

4.2 The award does not cover those classes of employees who, because of the nature or seniority of their role, have not traditionally been covered by awards including managerial employees and professional employees such as accountants and finance, marketing, legal, human resources, public relations and information technology specialists.

4.3 The award does not cover employees:

(a) in an industry covered by a modern award who are not within a classification in that modern award; or

(b) in a class exempted by a modern award from its operation,

or employers in relation to those employees.

4.4 The award does not cover employees excluded from award coverage by the Act.

4.5 The award does not cover employees who are covered by a modern enterprise award, or an enterprise instrument (within the meaning of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth)), or employers in relation to those employees.

4.6 The award does not cover employees who are covered by a State reference public sector modern award, or a State reference public sector transitional award (within the meaning of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth)), or employers in relation to those employees.

4.7 This award covers any employer which supplies on-hire employees in classifications set out in Schedule B 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. This subclause operates subject to the exclusions from coverage in this award.”

[64] During its award modernisation process, a Full Bench of the AIRC stated as follows:

“Miscellaneous Award 2010

[146] The principal issue in relation to the Miscellaneous Award 2010 (Miscellaneous Award) is its coverage. The relevant paragraph of the consolidated request reads:

“4A. The Commission is to create a modern award to cover employees who are not covered by another modern award and who perform work of a similar nature to that which has historically been regulated by awards (including State awards). The Commission is to identify this award as such. This modern award is not to cover those classes of employees, such as managerial employees, who, because of the nature or seniority of their role, have not traditionally been covered by awards. The modern award may deal with the full range of matters able to be dealt with by any modern award however the Commission must ensure that the award deals with minimum wages and meal breaks and any necessary ancillary or incidental provisions about NES entitlements.”

[147] Paragraph 2 of the consolidated request contains a number of principles or guidelines which are relevant. We note in particular paragraph 2(a):

“2. The creation of modern awards is not intended to:

(a) extend award coverage to those classes of employees, such as managerial employees, who, because of the nature or seniority of their role, have traditionally been award free. This does not preclude the extension of modern award coverage to new industries or new occupations where the work performed by employees in those industries or occupations is of a similar nature to work that has historically been regulated by awards (including State awards) in Australia;

… ….”

[148] Several parties also drew our attention to s.143(7) of the Fair Work Act:

“143 Coverage terms

Employees not traditionally covered by awards etc.

… …

(7) A modern award must not be expressed to cover classes of employees:

(a) who, because of the nature or seniority of their role, have traditionally not been covered by awards (whether made under laws of the Commonwealth or the States); or

(b) who perform work that is not of a similar nature to work that has traditionally been regulated by such awards.”

[149] Although s.143(7) does not come into operation until 1 January 2010 it is clearly relevant to the coverage of modern awards generally and the coverage of the Miscellaneous Award in particular. Common to all of the provisions we have set out is the requirement that awards should not cover employees who because of the nature or seniority of their roles have traditionally not been covered by awards. Many different approaches and drafting techniques were proposed to encapsulate that requirement. We note also the implication in paragraph 4A of the consolidated request that an award should be created to cover employees not covered by another modern award and who perform work of a similar nature to that which has historically been regulated by awards.

[150] A number of submissions canvassed the purpose or function of the award. The ACTU, for example, submitted that the functions of the award should be twofold. The first is to fill gaps in modern award coverage which became apparent during the process of setting aside award-based transitional instruments as required by the Transitional Act. The second function is to provide interim coverage for emerging industries pending the making of a new modern industry award or an appropriate extension to the coverage of an existing modern award. The Australian Government took a very similar approach, while stressing the importance to the economy of ensuring that employees who have not traditionally been covered by awards remain free from modern award coverage as well. In an earlier stage in the consultations ACCI proposed that the coverage of the award should not be settled until after an audit of modern award coverage to ascertain what if any gaps there are by comparison with the existing pattern of federal and state award coverage. AiGroup and ACCI both suggested that the award be limited to employees covered by a federal or state award or a Notional Agreement Preserving a State Award (NAPSA). AiGroup proposed in addition that industries and employers could be specified in a list attached to the award to permit new industries and employers to be added as necessary.

[151] Almost without exception employer representatives criticised the breadth of coverage in the exposure draft. They suggested that employees who have traditionally been excluded from award coverage, particularly professional and managerial employees, would be covered, including those deliberately excluded from modern award coverage in earlier stages of the modernisation process.

[152] We have considered all of the submissions and decided to include an additional paragraph in the coverage clause which more closely reflects the terms of the consolidated request and the Fair Work Act. The paragraph also contains some greater definition of the types of employees excluded. It reads:

“4.2 The award does not cover those classes of employees who, because of the nature or seniority of their role, have not traditionally been covered by awards including managerial employees and professional employees such as accountants and finance, marketing, legal, human resources, public relations and information technology specialists.” 19

[65] I have found, in effect, that Mr Norman was not covered by the Professional Employees Award as a result of being a senior manager. It is evident from the terms of the Miscellaneous Award, and the context in which it was made, that the intention of clause 4.2 of that award is to exclude from its coverage employees who fall outside of the scope of other modern awards because of various factors including because they are senior managers.

[66] As may be inferred from the decision of the AIRC above, it is notorious that senior managers of the level of Mr Norman in the private sector have not traditionally been covered by awards of industrial tribunals.

[67] I am satisfied that the Miscellaneous Award did not cover Mr Norman.

5. Conclusions and orders

[68] Being satisfied that Mr Norman was not covered by a modern award, and given the level of remuneration paid, I find that he was not protected from unfair dismissal by virtue of s.382(b) of the Act.

[69] Accordingly, there is no jurisdiction to determine the merit of the application and it must be dismissed.

[70] An Order 20 to that end is being issued in conjunction with this decision.

Appearances:

R Manuel, of counsel with permission, for Mr Norman.

N Charlesworth, of counsel, with W Ambrose, both with permission, for Fyfe Pty Ltd T/A Fyfe Earth Partners.

Hearing details:

Adelaide

2014

November 7 and December 16.

 1   MA000065.

 2   MA000104.

 3   Confirmed in final submissions.

 4   [2010] FWA 6503.

 5   PR938031 per Giudice J, Marsh SDP, Thatcher C, 16 September 2003.

 6   PR925731 per Williams SDP, Lacy SDP, Tolley C, 17 December 2002.

 7   Carpenter v Corona Manufacturing Pty Ltd PR925731 per Williams SDP, Lacy SDP, Tolley C, 17 December 2002 at PN 9.

 8   [2012] FWAFB 7184.

 9   [2011] FWA 3763.

 10   Carpenter v Corona Manufacturing Pty Ltd at [8].

 11   Qantas Airways Ltd v Christie (1998) 193 CLR 280.

 12   KMC 16 - part of Exhibit R2.

 13   KMC 17- part of Exhibit R2.

 14   The evidence of Mr Verco.

 15   Contract of employment.

 16   2010 performance review.

 17   Mr Norman’s statement at 14.

 18   The evidence of Mr Verco.

 19   Award Modernisation [2009] AIRCFB 945.

 20   PR559580.

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