Carr v Blade Repairs Australia Pty Ltd (No 2)

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FEDERAL COURT OF AUSTRALIA

Carr v Blade Repairs Australia Pty Ltd (No 2) [2010] FCA 688

Citation: Carr v Blade Repairs Australia Pty Ltd (No 2) [2010] FCA 688
Parties: LUCAS MATTHEW CARR v BLADE REPAIRS AUSTRALIA PTY LTD
File number(s): VID 123 of 2009
Judge: TRACEY J
Date of judgment: 2 July 2010
Date of final submission: 21 September 2009
Catchwords: INDUSTRIAL LAW– termination of employment – whether for a proscribed reason of employee’s age pursuant to s 664 of Workplace Relations Act 1996 (Cth) – whether repudiatory breach of contract of employment
Legislation: Federal Court Rules 1976 (Cth) order 72
Workplace Relations Act 1996 (Cth) s 659, 663-666, 841
Cases cited: Australian Broadcasting Commission v Australasian Performing Right Association Ltd (1973) 129 CLR 99, referred to
Berry v Wong [2000] NSWSC 1002, cited
Bryant v Defence Housing Authority [2002] ACTSC 43, compared
Bunge (Australia) Pty Ltd v Mallard (1982) 41 ALR 223, compared
Carr v Blade Repairs Australia Pty Ltd [2009] FCA 764, cited
Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337, cited
Claveria v Pilkington Australia Ltd [2007] FCA 1917, referred to
Federal Commissioner of Taxation v Sara Lee Household and Bodycare (Australia) Pty Ltd (2000) 201 CLR 520, cited, applied, considered, compared
Goldman Sachs JBWere Services Pty Ltd v Nikolich (2007) 163 FCR 62, referred to
Gregory v Philip Morris Ltd (1988) 80 ALR 455, applied
Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896, cited
Kelly v Fitzpatrick (2007) 166 IR 14, applied
Koh v Pateman [2005] WASC 172, compared
Maggbury Pty Ltd v Hafele Australia Pty Ltd (2001) 210 CLR 181, referred to
Maye v Colonial Mutual Life Assurance Society Ltd (1924) 35 CLR 14, referred to
Pan Foods Company Importers and Distributors Pty Ltd v Australia and New Zealand Banking Group Limited (2000) 170 ALR 579, cited
Riverwood International Australia Pty Ltd v McCormick (2000) 177 ALR 193, referred to
Robinson v Harman (1848) 1 Ex 850, applied
Tallerman & Company Pty Ltd v Nathan’s Merchandise (Vic) Pty Ltd (1957) 98 CLR 93, cited
Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165, cited, applied
Upper Hunter Country District Council v Australia Chilling and Freezing Company Ltd (1968) 118 CLR 429, referred to
Virgin Blue Airlines Pt Ltd v Hopper [2007] QSC 075, cited
Wesoky v Village Cinemas International Pty Ltd [2001] FCA 32, referred to
Date of hearing: 31 August 2009
Place: Melbourne
Division: FAIR WORK DIVISION
Category: Catchwords
Number of paragraphs: 88
Counsel for the Applicant: Ms R Sweet
Solicitor for the Applicant: Drew Gleeson Legal
Counsel for the Respondent: Mr M O'Connor
Solicitor for the Respondent: Maddens

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

FAIR WORK DIVISION

VID 123 of 2009
BETWEEN:

LUCAS MATTHEW CARR
Applicant
AND:

BLADE REPAIRS AUSTRALIA PTY LTD
Respondent

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Details
Case
[2010] FCA 688
Decision Date

CaseChat Overview and Summary

The applicant, Mr Carr, brought proceedings against Blade Repairs Australia Pty Ltd, the respondent, alleging that his dismissal contravened an anti-discrimination provision of the Workplace Relations Act 1996 (Cth) and constituted a breach of the contract of employment between the parties. The dispute arose from Mr Carr’s termination of employment by the respondent, which had occurred on or about 26 November 2008. Mr Carr claimed that the termination was discriminatory on the basis of his age and that the respondent was in breach of the contract of employment.

The court was required to determine two primary issues. Firstly, whether the respondent’s termination of Mr Carr’s employment contravened section 664 of the Workplace Relations Act 1996 (Cth), which prohibits discrimination on the grounds of age. Secondly, whether the termination constituted a repudiatory breach of the contract of employment between the parties. The court considered the terms of the employment agreement, the evidence given by both parties regarding the circumstances of the termination, and the legislative provisions relevant to the alleged contravention.

The court found that Mr Carr’s termination did contravene section 664 of the Workplace Relations Act 1996 (Cth), as it was based on discriminatory grounds. The evidence established that the respondent had laid off Mr Carr because of his age. Additionally, the court held that the termination constituted a repudiatory breach of the contract of employment. The court found that the respondent had effectively dismissed Mr Carr without providing the required notice, contrary to the terms of the employment agreement. As a result, the court awarded damages to Mr Carr in the amount of $24,607.72.

The court ordered that the respondent pay a penalty of $1,000 for its contravention of the Workplace Relations Act 1996 (Cth). Additionally, the court entered judgment in favour of Mr Carr for the breach of contract and ordered the respondent to pay the awarded damages. The court also ordered the applicant to pay the respondent’s costs thrown away by reason of the adjournment of the trial date.

Orders

Orders of the court

1. A penalty of $1,000 be imposed on the Respondent in respect of its contravention of s 659 of the Workplace Relations Act 1996 (Cth).

2. The Respondent pay the penalty of $1,000 to the Applicant.

3. Judgment be entered for the Applicant in respect of the Respondent’s breach of its employment agreement with the Applicant.

4. The Respondent pay damages to the Applicant fixed at $24,607.72.

5. The Applicant pay the Respondent’s costs thrown away by reason of the adjournment of the trial date fixed for 14 July 2009.

Note:

Background

Background to the litigation

The Applicant (“Mr Carr”) was employed by the Respondent (“Blade Repairs”) and its predecessor between March and November 2008. On or about 26 November 2008 Blade Repairs terminated his employment. Mr Carr contends that, in doing so, Blade Repairs contravened an anti-discrimination provision of the Workplace Relations Act 1996 (Cth) (“the Act”) and acted in breach of the contract of employment to which Blade Repairs and he were parties.BACKGROUND FACTS Vestas Australia Wind Technology Pty Ltd (“Vestas”) manufactured and serviced blades for wind turbine machines. It also managed wind farms. It had a factory in Portland which it closed in December 2007. Mr Carr worked for Vestas at the Portland factory between January 2006 and March 2007. After the factory closed Vestas approached Mr Trevor Van Kempen who was the sole director and secretary of Total Blades Pty Ltd (“Total Blades”) and asked Mr Van Kempen to provide two teams of three men to undertake blade repair work on wind turbines in South Australia. Work was to commence in early February 2008 and continue for three months. The work was described as “monolithic root repair”. Mr Van Kempen organised the teams and they were employed by Total Blades who then contracted with Vestas to provide the repair services. In February 2008 Vestas again approached Mr Van Kempen and asked if he would organise a further two teams of three men to do similar work in Western Australia for three months commencing on 1 April 2008. Vestas advised Mr Van Kempen that the work was expected to last between three to six months, and possibly up to 12 months. Mr Van Kempen agreed to organise these two teams. He recruited six workers in Portland, five of whom had previously worked at the Vestas factory. One of the five was Mr Carr. Mr Carr and the other employees were engaged by Total Blades. Mr Carr entered into a written agreement with Total Blades on 26 March 2008. Mr Carr signed the agreement following a discussion with Mr Van Kempen. There is some dispute as to what was said in the course of that conversation. Mr Carr said that Mr Van Kempen told him that there was six to 12 months’ work to be done. Mr Van Kempen said that he told Mr Carr that “the work would go 3-6 months with a possibility of going longer.” The agreement provided, in part, that:“1. INTRODUCTION1.1This Agreement sets out the provisions and entitlements for the employee when the employee is engaged to perform work by the Company. …2. DURATIONThis Agreement shall remain in force until the termination of the Employer’s contract of supply with Vestas Australia Wind Technology Pty. Ltd, which contract the Employee acknowledges may be determined at anytime by the provision of two (2) week’s [sic] notice at anytime from Vestas to the Employer.3. BASIS OF EMPLOYMENT 3.1The employee is engaged in the classification of fibreglass technician. It is a condition of employment that a 3 month probation period applies to all new employees from the date of commencing employment. During the probationary period the employment may be terminated by one hour’s notice by either party or payment of one hour’s pay in lieu. 3.2 Notice of Termination(i)After the completion of the probationary period the following periods of notice shall be given by either party on termination of service or paid or forfeited in lieu thereof:Period of Continuous Service Period of NoticeUp to one year 1 weekOne year to three years 2 weeksThree years to five years 3 weeksMore than five years 4 weeksThe company has the right to pay you in lieu of such notice. The Company must provide one additional weeks [sic] notice if:• the employee is over 45 years of age; and• has completed at least two years continuous service. (ii)Further in all other circumstances the Company may immediately dismiss an employee after the employee has received at least 1 verbal and 2 written warning’s [sic] for misconduct or dangerous, illegal behaviour. (iii)Notwithstanding subclause (i) or (ii) the Company retains the right to dismiss an employee without notice for inefficiency, theft, neglect of duty or misconduct. In such circumstances, wages shall only be payable up to the time of dismissal. 3.3 Abandonment of EmploymentIf the employee is absent from work for 3 consecutive working days without notifying the Company it shall be assumed that the employee has abandoned their employment. If within a further period of 5 days the employee has not satisfied the Company that there was a reasonable excuse for their absence then the employee shall be deemed to have abandoned their employment from the first day of absence. 4. WAGESFOR THE DURATION OF THIS AGREEMENT you are entitled to the Rate of pay detailed in Item 3 of the Schedule. Unless your role changes which increases or decreases your level of responsibility, or improvement during the period of your probation, this rate will remain fixed for the first year of this contract, when the rate may be reviewed without guarantee or an entitlement to an increase in the rate. The company reserves the right to reduce an employee’s pay if deemed to have been demoted from the role for which they were initially engaged.” (Emphasis in original.)

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

For reasons and in circumstances which were not explained “[t]he business conducted by Total Blades was”, according to Mr Van Kempen, “transferred to [Blade Repairs] effective from 1 September 2008.” Blade Repairs’ defence alleged that Mr Carr’s employment was “transmitted” to it on 1 September 2008. In any event, an employment agreement between Mr Carr and Blade Repairs was executed on 7 October 2008. So far as is relevant, the written terms of that agreement were in the same form as the earlier employment agreement between Mr Carr and Total Blades save for clause 2 which provided:“2. DURATIONThis Agreement shall remain in force until the termination of the Employer’s contract of supply with Vestas Australia Wind Technology Pty. Ltd, which contract the Employee acknowledges may be determined at anytime by Vestas to the Employer.”(Emphasis in original.) Mr Carr continued to provide his services as a fibreglass technician under the new agreement. From a practical point of view, as far as he was concerned, his entering into a new contract with Blade Repairs had no impact on his day to day activities. On 25 November 2008 Mr Van Kempen had a conversation with a representative of Vestas, a Mr Wallace. Mr Van Kempen was told that he would have to lay off a team of workers. On the following day, or shortly thereafter, Mr Van Kempen and Mr Carr had a conversation on the telephone. Mr Van Kempen was at the Perth airport and Mr Carr was at home on leave at the time the two men spoke. There is a significant dispute as to the language employed by Mr Van Kempen during this conversation. What, however, is clear is that Mr Van Kempen advised Mr Carr that he was terminating Mr Carr’s employment with almost immediate effect. Mr Van Kempen confirmed his decision to terminate Mr Carr’s employment in an undated letter to Mr Carr which he said he signed on 3 December 2008. That letter read, in part:“As discussed recently we regret that we are having to cease your employment at Blade Repairs Australia P/L as at 28 November 2008, due to reduction of contract work supplied to us by Vestas Australia P/L.All your entitlements have been paid to you (including sick days) and we thank you for your hard work over the past months.” Mr Carr then sought alternative employment. On 5 December 2008 he commenced employment with a timber and hardware company. He worked for that company for about six weeks during which time he earned $2,509.86. He then obtained employment with a building company. That employment commenced on 23 January 2009 and continued until 7 April 2009. Prior to trial he estimated that, during this period, he earned about $9,500. On or about 30 April 2009, Mr Carr became self employed. He undertook construction work and, he estimated before trial, earned approximately $8,000 over the next three month period. At trial he led evidence which established that he earned $24,974.30 in alternative employment between 5 December 2008 and the end of July 2009. CONTRAVENTION OF THE WORKPLACE RELATIONS ACT