Bolden v Smith Reid Training Group and O'Keefe v Smith Reid Training Group and Porter v Smith Reid Training Group
[1997] IRCA 264
•11 September 1997
DECISION NO:264/97
INDUSTRIAL RELATIONS COURT OF AUSTRALIA
INDUSTRIAL LAW - termination of employment - labour market program providing assistance to long term unemployed - program
conducted by Respondent - held participants in program were not employees - costs
Workplace Relations Act 1996 ss.170CA, 170CB, 170DE, 170EA
CASES:
General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125
Dietrich v Dare (1980) 30 ALR 407
Rowe v Capital Territory Health Commission (1981-82) 39 ALR 39, (1981) 1 IR 133
Kanan v Australian Postal and Telecommunications Union (1992) 43 IR 257
BOLDEN -v- SMITH REID TRAINING GROUP
No. VI-2298 of 1996
O’KEEFFE -v- SMITH REID TRAINING GROUP
No. VI-2299 of 1996
PORTER -v- SMITH REID TRAINING GROUP
No. VI-2300 of 1996
Ryan JR
Melbourne
11 September 1997
INDUSTRIAL RELATIONS
COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
VI-22980 of 1996
B E T W E E N :
SHANE WILLIAM BOLDEN
Applicant
AND
SMITH REID TRAINING GROUP
Respondent
VI-2300 of 1996
B E T W E E N :
BRENDAN DENNIS O’KEEFFE
Applicant
AND
SMITH REID TRAINING GROUP
Respondent
VI-2300 of 1996
B E T W E E N :
JASON GREGORY PORTER
Applicant
AND
SMITH REID TRAINING GROUP
Respondent
MINUTES OF ORDERS
Judicial Registrar Ryan 11 September 1997
THE COURT ORDERS:
The applications be dismissed.
NOTE: Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules
INDUSTRIAL RELATIONS
COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
VI-2298 of 1996
B E T W E E N :
SHANE WILLIAM BOLDEN
Applicant
AND
SMITH REID TRAINING GROUP
Respondent
VI-2299 of 1996
B E T W E E N :
BRENDAN DENNIS O’KEEFFE
Applicant
AND
SMITH REID TRAINING GROUP
Respondent
VI-2300 of 1996
B E T W E E N :
JASON GREGORY PORTER
Applicant
AND
SMITH REID TRAINING GROUP
Respondent
Ryan JR
Melbourne
11 September 1997
REASONS FOR JUDGMENT
THE CLAIMS
The Applicants seek reinstatement and compensation in claims of unlawful termination of employment. The Respondent denies that it ever formed any employment relationship with the Applicants.
THE MOTIONS
The Respondent by Notice of Motion requests that the applications be struck out for want of jurisdiction.
THE LABOUR MARKET PROGRAM
The Respondent contracted with the Commonwealth Department of Education, Employment and Training and Youth Affairs (“DEET”) to delivery the New Works Opportunities Program (NWO) which was a Labour Market Program.
The Respondent through the affidavit of Amanda Birmingham, sworn 22 October 1996 asserts
the Respondent was funded to run seven individual programs and was referred to as a “Sponsor”
persons considered to be long term unemployed were placed on the Program and were referred to as “Participants”
the Sponsor was required to abide by Sponsor Guidelines prepared by DEET
NWO projects provided work experience and training to eligible job seekers who were having difficulty finding a job
NWO Programs do not and are not intended to create an employment relationship between the Sponsor and the Participant
the Programs are designed to provide training to the Participants to assist them in acquiring skills, experience and confidence to seek employment
participants receive a mix of supervised work experience, on the job and off the job training and “the opportunity to develop new skills and/or enhance existing skills in a work like environment over a twenty-six week period”
participants are paid “a training allowance...depending on the skill level of tasks undertaken”
the Applicants were considered to be “long-term unemployed...(and) ..signed a Sponsor/Participant agreement which provided........ ...placement on the Landbyte Project”
The Landbyte Project was based in Western Victoria. Landbyte teams were generally based in Shire Offices. The Applicants, as participants in this particular NWO Program, appear to have been
classified as “NWO eligible clients with an interest in computer and information technology, conservation planning, office technology and environmental issues”
(ii)prepared and trained so that they might obtain the “Accredited Certificate in Basic Land Care and Environment Action”
The Landbyte Project is stated to have been structured with
“off-site training with an approved training provider”
“eight weeks on the job training”
“formal training through Complete Job Services Pty Ltd”
“field experience”
“preparation of land use map product set”
“job search and out orientation”
The Respondent claims to have terminated the placement of the Applicants in accordance with the provisions of the Sponsorship Agreement with the Commonwealth.
RESPONDENT DENIES JURISDICTION
The Respondent relies in part on advice from Katherine Moir, a principal legal advisor of DEET. Her opinion was as follows
“The Commonwealth does not consider that arrangements under the New Work Opportunities Program actually give rise to an employment relationship for participants on that program.”
The Respondent asserts that participants
were involved in a labour market program conducted by the Commonwealth Government
did not receive a wage or annual leave
did not make or receive superannuation contributions
The Respondent states that the participation of the Applicants on the Landbyte Project did not give rise to the creation of an employment relationship with the Respondent and moves the Court to strike out each application for want of jurisdiction.
EVIDENCE OF THE APPLICANTS
The Applicants O’Keefe and Porter rely on the affidavit of the Applicant Bolden sworn 6 February 1997. Mr O’Keefe has sworn that he has read the affidavit of Mr Bolden and that “facts and matters set out therein are to (his) knowledge true and correct”. Mr Porter has not filed an affidavit but the Court accepts that he too adopts and relies on Mr Bolden’s affidavit.
Relevant parts of Mr Bolden’s affidavit are extracted and summarised below. The numbers refer to the paragraphs of the original affidavit.
“3.The employment occurred in accordance with the direction of Mr Paul Barker, Case manager of Employment Assistance Australia, 200 Timor Street, Warrnambool. The direction was contained in a letter dated 6th March, 1996 (Exhibit “SB1”).
The letter required me to attend for interview. At interview I was told very little about what I would be doing other than to report to the Respondent.
On the first day I attended at the office of the Respondent at 34 Kepler Street, Warrnambool. Present were Mr Wayne Wilson, Mr Gary Dowie, Mr Gary Mason and Mr David Laird. Messrs Wilson, Dowie and Mason were apparently officers or employees of the Respondent and Mr Laird a C.E.S. officer.
At this meeting I and my co-workers were told that we would receive full time training for three weeks followed by actually doing the job with some further weekly training.
I was required to sign a Sponsor/Participant Agreement and a further agreement with the Smith Reid Training Group both dated 18th March 1996 (Exhibits “SB2” and “SB3”). At the time of signing these documents there was no discussion as to the nature of our involvement with the Respondent be it employment or anything else.
The first week involved training in first aid.
The following two week period was devoted to training in occupational health and safety, rural mapping and computer work.
10.From the end of the third week every Monday was devoted to training and Tuesdays through to Fridays inclusive we were asked to carry out various jobs and this continued for approximately ten weeks until my termination.
11.On Mondays approximately fifteen people, started at about 9:00 am and received unstructured lessons on a fairly informal basis until we were dismissed at approximately 3:30 pm. On these training days we received lessons concerning the environment.
12.On a working day I would again start at approximately 9:00 am. I would wait together with the remainder of my co-workers for Mr Wayne Wilson to attend the office in Koroit. Mr Wilson was in charge and would write up jobs to be done, the people allocated the task, the job description, together with individual tasks within that group, such as driving the car.
13.The jobs related to the rural addressing scheme. This involved being allocated a road in the local western district vicinity, driving to a “connecting point”, measuring distances via an odometer to every driveway to a residence along that road, recording the necessary information in relation to the respective distance and continuing until the road was complete.
14.Alternative duties included placing the results of the field sheets, (produced by rural mapping) onto a computer or ultimately being allocated to physically affix road numbers to fence posts for each of the driveways allocated a rural road number.
15.We worked in conjunction with the Moyne Shire Council and I believe that an arrangement existed whereby Moyne Shire Council supplied vehicles, fuel, road numbers, shovels and all other necessary tools.
16.At the end of every week I, together with my co-workers, was required to fill out a book kept by Smith Reid Training Group containing what tasks were completed during the week and our comments in relation to that work. That book was left in the possession of the Respondent and I do not possess a copy.
17.Mr Wayne Wilson, our supervisor, exercised control over us during the working day to the extent that, in addition to the primary tasks noted above, we would be variously required to undertake additional duties including:
(a) fetching equipment
(b) getting parts for his volkswagon, which I myself was required to do
(c)running errands for Smith Reid Training Group, including the collection of mail which I myself did and I witnessed Mr Jason Porter also being required to do on a number of occasions
(d) placing bets for Mr Wilson at the TAB
(e) chopping wood
(f)moving furniture for the Respondent from Warrnambool to Koroit and carpet from Port Fairy to Koroit to be used in conjunction with the office we occupied; and
(g)from time to time we were also required to record, in relation to sealed and unsealed roads, the number of white posts, measure painted white lines marked on roads, count traffic control signs and identify those that were missing, this apparently being information required by the Moyne Shire Council
18.I did these things when asked believing that as Mr Wilson and other staff of the Respondent were our bosses, they were entitled to give us jobs to do and we had a duty to perform them.
20.The agreement between the Commonwealth of Australia and the Smith Reid Training Group for New Work Opportunities Sponsorship was never sighted by me nor were its contents ever explained to me prior to the commencement of this proceeding.
21.I was not aware of the Sponsor Guidelines prior to the commencement of this proceeding.
22.I understood at the commencement of my involvement with the Respondent that I would be engaged on full time employment for a period of six months during which I would gain work experience and be trained in the skills associated with rural mapping.
23.I understood that it was possible that the work could continue if further rural mapping was required and that I would be well placed to continue employment.
24.I was paid $333 per week by the Respondent.
25.Although the Agreements exhibited as “SB2” and “SB3” refer to “training allowance” this was referred to as simply “pay” in discussions.
26.I received fortnightly pay slips. Now produced (Exhibit “SB4”) pay slip noting myself as the employee.
27.Upon my termination I was provided with a Group Certificate showing me as employee and the Respondent as employer. (Exhibit “SB5”).”
Mr Bolden does not explain the basis of his “understanding” (paragraphs 22 and 23) that he was “engaged on full-time employment” and that “it was possible that work would continue if further rural mapping was required”. He has simply expressed, in paragraph 30 of his affidavit, a “belief” that he and “my fellow co-workers were treated as employees in the workplace”.
In paragraph 31 of his affidavit Mr Bolden again expresses a “belief” which seems to ground his assertion that he and others were employees. He states
“31.I believe I was employed by Smith Reid Training Group during the time I rendered my labour in exchange for payment and at all times submitted to the direction and control of Smith Reid Training Group. I have previously held down a number of jobs prior to my involvement with the Respondent and I can discern no difference between these situations and my involvement with the Respondent which suggested to me that I was not an employee of Smith Reid Training Group. I was treated like an employee and believe I was one.”
The Court accepts that the affidavit of Mr Bolden is his sworn testimony. The Court accepts his evidence as to facts and accepts that the Applicants O’Keefe and Porter support Mr Bolden. The Court notes the “beliefs” and “understandings” expressed by Mr Bolden and assumes that he was assisted by his solicitors in the manner in which he expressed those beliefs and understandings. The Court does not accept that previous experience as an employee, and Mr Bolden’s inability to discern any difference between earlier employment “situations” and his involvement with the Respondent, are of any real assistance in determining whether the Applicants and the Respondent were in a relationship of employer/employee.
THE SUBMISSION AGAINST SUMMARY DISMISSAL OF THE APPLICATIONS
The Applicants submit that
the “jurisdiction summarily to terminate an action is to be sparingly employed and is not to be used except in a clear case where the Court is satisfied that it has the requisite material and the necessary assistance from the parties to reach a definite and certain conclusion”: General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125
the applications for summary dismissal ought to be refused unless the Court is satisfied that there is a clear case for summary disposal
the relationship between the Applicants and the Respondent was contractual in nature and involved contracts in which
(a)each Applicant placed himself under a legal obligation to perform work under the direction and control of the Respondent
(b)the Respondent placed itself under a legal obligation to provide the Applicants with work and consideration by way of remuneration
The Applicants also maintain that
there was a clear obligation on the part of the Applicants to maintain regular hours of work, to record those hours and to perform productive work
the Respondent exercised a high degree of control over the Applicants in the performance of their duties
the on-the-job training involved productive work for the Respondent and clients of the Respondent
the range of duties performed by each Applicant were the duties of an employee and were not merely training exercises
WERE THE APPLICANTS EMPLOYEES?
Both counsel cited Dietrich v Dare (1980) 30 ALR 407 in support of their respective positions. Counsel for the Applicants relied on Rowe v Capital Territory Health Commission (1981-82) 39 ALR 39, (1981) 1 IR 133, for the proposition that “the mere fact that a person is performing duties under a contract, the primary purpose of which is to teach that person an occupation, does not prevent that person from being an employee”.
While I agree that Rowe is authority for the rather limited proposition put by Counsel for the Applicant, I do not agree that Rowe, at first instance or on appeal, (1982) 2 IR 27, is of assistance to the Applicants.
At first instance, Keely J found certain student nurses were performing work which was an essential part of the services provided by the Capital Territory Health Commission to patients. He found the Commission was employer and the nurses were employees.
On appeal, Northrop, Deane and Fisher JJ found the student nurses were performing work for the Commission in a relationship of service as employees but, at the conclusion of the judgment (2 IR 29), their Honours stated
“It should be stressed that the decision in each of the present matters is based on the nature and extent of the work performed by the relevant student nurse and the circumstances surrounding the performance of that work. Those circumstances include the contractual relationship between the Commission and student nurse, the fact that the work was performed under that contractual relationship, the fact that that work, as Keely J found, constituted part of the services which the Commission provided to its patients and the financial payments which the Commission was, while the contractual relationship subsisted, obliged to make to the student nurse. It would be a mistake to regard the decision in the present matters as being necessarily relevant to the position of those receiving practical training for other occupations or to the position of student nurses in different situations; for example, obtaining practical experience at a hospital as part of their course of training at an independent nursing college.”
Unlike Rowe, there is no evidence here that any of the Applicants were performing work for the Respondent. The Applicants may well have been providing services which were of some value to the Shire of Moyne but they were not providing services to the Respondent and they were not performing work for the Respondent in a relationship of service. The minor personal services for Mr Wilson (fetching, carrying, running errands, chopping wood) were not services for the Respondent for remuneration and were not services of a degree and type which rendered the Applicants employees of the Respondent
The circumstances were closer to those outlined in Dietrich where the appellant was an unemployed person with substantial health problems who was undergoing a trial period with the Respondent to ascertain whether he was capable of painting the exterior of the Respondent’s house in a satisfactory manner. Remuneration during the trial period was fixed by agreement at $2 per hour. The High Court held that no contract for services and no contract of service existed between the parties. Soon after the appellant began the trial he sustained an injury as a result of a fall and he claimed workers compensation as a result of personal injury and incapacity for work.
At 411 the High Court said
“We have indicated that from the point of view of the appellant, the arrangement did not place him under any legal obligation to do anything. Likewise, the respondent did not receive any assurance of benefit to which the payment of money could be related. The work which the appellant was able to do during the trial might have proved beneficial to him because it enhanced the value of his property; but, on the other hand, it might have proved unhelpful, requiring the expenditure of further moneys to overcome the effect of incompetent workmanship. The trial arrangement provided him with no assurance whatever.”
Here too the Respondent did not receive any assurance of benefit to which the payment of money could be related. Indeed, in Dietrich, the trial might have proved beneficial to the Respondent through enhancement of the value of his property. In these cases, no benefits flowed directly to the Respondent. If there were direct benefits, they flowed to the Shire of Moyne. I suppose it could be said that indirect benefits may have flowed to the Respondent in that activities undertaken by the Applicants for the Shire of Moyne may have persuaded or influenced DEET to approve the Respondent as a Sponsor in the Program.
Be that as it may, I have concluded that the arrangement between the Applicants and the Respondent lacked the mutuality of obligation essential to a contract of service. The Applicants were not employees of the Respondent and the Respondent was not an employer in a contract of service with the Applicants as employees.
In reaching that conclusion I have noted that
the Landbyte project was described as
· a New Work Opportunites Project....conducted by the (Respondent) in conjunction with the Glenelg Shire Council
· a training program (in which).....participants will...have the opportunity to develop skills in relation to seeking employment
(ii)the Applicants signed a document entitled “Conditions for involvement in the Landbyte Project” which referred to
· a taxable weekly training allowance of up to $333 gross per week
· a New Work Opportunities Program for the 26 week period
· an accredited training program
· assistance with future employment or further training outcomes
(iii)the Applicants and the Respondent signed a Sponsor/Participant Agreement which
· identifies each Applicant (Participant) as a “job seeker”
· describes the 26 week period 18/3/96 to 13/9/96 as a “work experience and training placement”
(iv)the Agreement between the Commonwealth of Australia and the Respondent does not anticipate or provide for the employment of Participants by the Respondent but does provide for
· “a case manager to improve the employment prospects of job seekers who face a competitive disadvantage in the labour market”
· “Job Compact clients in continuous receipt of Job Search and Newstart Allowance for 18 months or more”
· “26 weeks work experience and training”
· “placement support with emphasis on job search assistance”
DISMISSAL OF APPLICATIONS FOR LACK OF JURISDICTION
In the circumstances, the three applications lack jurisdiction. The Notice of Motion in each case requests that the application be struck out for want of jurisdiction. The Motions will be granted in the sense that the applications will be dismissed.
COSTS
The Respondent in each Notice of Motion also seeks an order that each Applicant pay costs incurred by the Respondent at least to the date of the Notices made and filed on 22 October 1996.
In fact the Court assumes that the Respondent seeks payment of all costs on the basis that the Applications were made without reasonable cause.
I do not accept that the Applications were made without reasonable cause and I rely on Kanan v Australian Postal and Telecommunications Union (1992) 43 IR 257 at 264 where Wilcox J stated
“It seems to me that one way of testing whether a proceeding is instituted ‘without reasonable cause’ is to ask whether, upon the facts apparent to the applicant at the time of instituting the proceeding, there was no substantial prospect of success. If success depends upon the resolution in the applicant’s favour of one or more arguable points of law, it is inappropriate to stigmatise the proceeding as being ‘without reasonable cause’. But where, on the applicant’s own version of the facts, it is clear that the proceeding must fail, it may properly be said that the proceeding lacks reasonable cause.”
In these cases there were certain indicia of employment namely recorded hours of work, a high degree of control, employer/employee group certificates and even an incorrect reference by the Case Manager Paul Barker to “full time employment for a period of 6 months”. (Exhibit “SB1”). These were only indicia and the Court has found no employment of the Applicants as employees of the Respondent. Nevertheless arguments were mounted and I do not find that the proceedings were instituted without reasonable cause. In the circumstances section 347 prohibits orders for costs against the Applicants. Even if costs were open under section 347 an order is discretionary and I would not have exercised the discretion in favour of the Respondent even if that course had been open to me.
MINUTES OF ORDERS
THE COURT ORDERS:
The applications be dismissed.
NOTE: Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules
I certify that this and the preceding 10 pages are a true copy of the reasons for judgment of Judicial Registrar Ryan.
Associate:
Dated: 11 September 1997
Solicitors for the Applicant: Mackay Taylor
Counsel for the Applicant: Mr Brian Lacy
Solicitors for the Respondent: Phillips Fox
Counsel for the Respondent: Mr G M Giudice
Date of hearing: 4 April 1997
Date of judgment: 11 September 1997
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