Chambers v The Trustee for Goanna Tracks Trust
[2019] FCCA 3766
•20 December 2019
FEDERAL CIRCUIT COURT OF AUSTRALIA
| CHAMBERS v THE TRUSTEE FOR GOANNA TRACKS TRUST & ANOR | [2019] FCCA 3766 |
| Catchwords: PRACTICE & PROCEDURE – liability as an accessory – necessary content of allegation. |
| Legislation: Fair Work Act 2009, ss.12, 13, 14, 22, 44, 45, 90, 117, 311, 340, 341, 342, 536, 539, 542, 543, 545, 547, 550 Long Service Leave Act 1955 (NSW), ss.4, 10, 10A, 10B Corporations Act 2001, ss.50AAA, 50AA, 64A, 500 Superannuation Guarantee (Administration) Act 1992, s.19 |
| Cases cited: Fair Work Ombudsman v Centennial Financial Services Pty Ltd & Ors (2010) 245 FLR 242 Whelan v Cigarette & Gift Warehouse Pty Ltd (2017) 275 IR 285 |
| Applicant: | EUGENE CHAMBERS |
| First Respondent: | THE TRUSTEE FOR GOANNA TRACKS TRUST (ABN 97 398 642 733) |
| Second Respondent: | TOM CROMB |
| File Number: | SYG 209 of 2017 |
| Judgment of: | Judge Cameron |
| Hearing date: | 7-8 August 2018 |
| Date of Last Submission: | 8 August 2018 |
| Delivered at: | Sydney |
| Delivered on: | 20 December 2019 |
REPRESENTATION
| Counsel for the Applicant: | Ms U Okereke-Fisher |
| Solicitors for the Applicant: | Legal Aid New South Wales |
| The Second Respondent appeared in person (by telephone) |
ORDERS
The application be dismissed.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 209 of 2017
| EUGENE CHAMBERS |
Applicant
And
| THE TRUSTEE FOR GOANNA TRACKS TRUST (ABN 97 398 642 733) |
First Respondent
| TOM CROMB |
Second Respondent
REASONS FOR JUDGMENT
INTRODUCTION
The applicant is a former employee of the first respondent, Goanna MX Pty Ltd trading as Goanna Tracks Motocross (“Goanna MX”) which operated a motocross track at Coonabarabran in central western New South Wales. Although the identity of the trustee who was joined as the first respondent was never clearly alleged or proved, the respondents appear to have identified it as Goanna MX by citing it as such in their defence filed on 31 August 2017. The second respondent is alleged to have formerly been a manager of the first respondent.
On 19 January 2017 the applicant commenced this proceedings alleging that the first respondent contravened the Fair Work Act 2009 (“FW Act”) because it:
a)failed to pay him his wages;
b)failed to pay him his accrued annual leave;
c)failed to make superannuation contributions on his behalf;
d)failed to provide him with written notice of termination or pay in lieu thereof;
e)failed to provide him with pay slips; and
f)took adverse action against him on the basis that he had exercised a workplace right.
The applicant also alleged that he had not been paid long service leave entitlements, in contravention of the Long Service Leave Act 1955 (NSW) (“LSL Act”).
Further, the applicant seeks declarations that the second respondent contravened the FW Act and the LSL Act, orders for the rectification of his unpaid entitlements, compensation for non-economic loss, and the imposition of pecuniary penalties.
On 5 June 2018 the Court was advised by email from the first respondent’s liquidator that the first respondent had been placed into liquidation. Evidence that the company had entered a creditors’ voluntary liquidation was subsequently adduced in an annexure to the affidavit of Felix James Turnbull sworn 7 August 2018. As a result, pursuant to s.500(2) of the Corporations Act 2001 (“Corporations Act”) the part of this proceeding which involves the claim against the first respondent may not be “proceeded with”.
RELEVANT LEGISLATION
Fair Work Act
National system employee
Section 13 of the FW Act provides that a “national system employee” is an individual who is employed by a “national system employer” as that term is defined in s.14 of the FW Act. Section 14(1)(a) provides that a “national system employer” includes a constitutional corporation which employs, or usually employs, an individual.
National Employment Standards
Part 2-2 of the FW Act contains the National Employment Standards (“NES”) which are minimum standards of employment which cannot be displaced. Sections 90 and 117 of the FW Act are provisions within
pt.2-2 and relevantly provide:
90 Payment for annual leave
…
(2) If, when the employment of an employee ends, the employee has a period of untaken paid annual leave, the employer must pay the employee the amount that would have been payable to the employee had the employee taken that period of leave.
…
117 Requirement for notice of termination or payment in lieu
Notice specifying day of termination
(1) An employer must not terminate an employee’s employment unless the employer has given the employee written notice of the day of the termination (which cannot be before the day the notice is given).
Amount of notice or payment in lieu of notice
(2) The employer must not terminate the employee’s employment unless:
(a) the time between giving the notice and the day of the termination is at least the period (the minimum period of notice) worked out under subsection (3); or
(b) the employer has paid to the employee (or to another person on the employee’s behalf) payment in lieu of notice of at least the amount the employer would have been liable to pay to the employee (or to another person on the employee’s behalf) at the full rate of pay for the hours the employee would have worked had the employment continued until the end of the minimum period of notice.
(3) Work out the minimum period of notice as follows:
(a) first, work out the period using the following table:
Period Employee’s period of continuous service with the employer at the end of the day the notice is given Period 1 Not more than 1 year 1 week 2 More than 1 year but not more than 3 years 2 weeks 3 More than 3 years but not more than 5 years 3 weeks 4 More than 5 years 4 weeks (b) then increase the period by 1 week if the employee is over 45 years old and has completed at least 2 years of continuous service with the employer at the end of the day the notice is given.
Section 44 of the FW Act provides that an employer must not contravene a provision of the NES.
Adverse action
Part 3-1 of ch.3 of the FW Act provides for employees’ general protections. Division 3 of pt.3-1 provides for the protection of workplace rights and of the exercise of those rights. Sections 340 to 342 of the FW Act are found in div.3 of pt.3-1 and relevantly provide:
340 Protection
(1)A person must not take adverse action against another person:
(a) because the other person:
(i) has a workplace right; or
(ii) has, or has not, exercised a workplace right; or
(iii) proposes or proposes not to, or has at any time proposed or proposed not to, exercise a workplace right; or
(b)to prevent the exercise of a workplace right by the other person.
…
341 Meaning of workplace right
Meaning of workplace right
(1) A person has a workplace right if the person:
…
(c)is able to make a complaint or inquiry:
(i) to a person or body having the capacity under a workplace law to seek compliance with that law or a workplace instrument; or
(ii) if the person is an employee—in relation to his or her employment.
…
342 Meaning of adverse action
(1)The following table sets out circumstances in which a person takes adverse action against another person.
Meaning of adverse action Item Column 1
Adverse action is taken by ...
Column 2
if ...
1 an employer against an employee the employer:
(a) dismisses the employee; or
(b) injures the employee in his or her employment; or
(c) alters the position of the employee to the employee’s prejudice; or
(d) discriminates between the employee and other employees of the employer.
…
Superannuation
Clause 20 of the Amusement, Event and Recreation Award 2010 (“Modern Award”), which is a modern award, relevantly provides as follows:
20. Superannuation
…
20.2 Employer contributions
An employer must make such superannuation contributions to a superannuation fund for the benefit of an employee as will avoid the employer being required to pay the superannuation guarantee charge under superannuation legislation with respect to that employee.
Section 45 of the FW Act provides that a person must not contravene a term of a modern award.
Pay slips
Section 536(1) of the FW Act provides that an employer must give a pay slip to each of its employees within one working day of paying an amount to an employee in relation to the performance of work.
Accessorial liability
Section 550 of the FW Act states:
550 Involvement in contravention treated in same way as actual contravention
(1) A person who is involved in a contravention of a civil remedy provision is taken to have contravened that provision.
(2) A person is involved in a contravention of a civil remedy provision if, and only if, the person:
(a) has aided, abetted, counselled or procured the contravention; or
(b) has induced the contravention, whether by threats or promises or otherwise; or
(c) has been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to the contravention; or
(d) has conspired with others to effect the contravention.
Compensation and interest
Section 539 of the FW Act provides that ss.44(1), 45, 340(1) and 536(1) are civil remedy provisions. Section 545(2)(b) of the FW Act provides that the Court may award compensation for loss suffered because of a contravention of any of the civil remedy provisions.
Section 543 provides that a national system employee may apply to the Court to enforce an entitlement of the employee arising under s.542(1) of the FW Act which concerns “safety net contractual entitlements”. They are contractual provisions which relate to matters in respect of which minimum standards are set by the NES or an applicable modern award: s.12, FW Act.
Section 547 of the FW Act provides for interest to be included in compensation ordered to be paid under that Act.
Long Service Leave Act
Section 4 of the LSL Act provides as follows:
4 Long service leave
(1) …
(2)
(a) Subject to paragraph (a2) and subsection (13) the amount of long service leave to which a worker shall be so entitled shall:
(i) in the case of a worker who has completed at least 10 years service with an employer be:
(A)
in respect of 10 years service so completed, 2
months, and
…
(iii) in the case of a worker who has completed with an employer at least five years service, and whose services are terminated by the employer for any reason other than the worker’s serious and wilful misconduct, or by the worker on account of illness, incapacity or domestic or other pressing necessity, or by reason of the death of the worker, be a proportionate amount on the basis of 2 months for 10 years service.
…
(a3) For the purposes of subsections (2), (3) and (3A), month means 4 and one-third weeks.
…
(5)
(a)Where the services of a worker are terminated otherwise than by the worker’s death and any long service leave:
(i) to which the worker was entitled has not been taken, or
(ii) accrues to the worker upon such termination and has not been taken,
the worker shall, subject to subsection (13), be deemed to have entered upon the leave from the date of such termination and the employer shall forthwith pay to the worker in full the worker’s ordinary pay for the leave less any amount already paid to the worker in respect of that leave.
…
(11) For the purposes of this section –
…
(c) where a business, undertaking or establishment or any part thereof has, whether before or after the commencement of this Act, been transmitted from an employer (in this paragraph called the transmittor) to another employer (in this paragraph called the transmittee) and a person who at the time of the transmission was a worker in the employ of the transmittor in that business, undertaking, establishment or part thereof becomes a worker in the employ of the transmittee:
(i) the continuity of the period of service of the worker shall be deemed not to have been broken by reason of the transmission, and
(ii) the period of service which the worker has had with the transmittor or any prior transmittor shall be deemed to be service of the worker with the transmittee.
In this paragraph transmission, without limiting its ordinary meaning, includes transfer, conveyance, assignment or succession, whether by agreement or operation of law, and transmitted has a corresponding meaning.
…
Section 10 of the LSL Act provides that a person who has contravened any provision of that Act is liable to a penalty not exceeding 20 penalty units.
ALLEGATIONS
A statement of claim was filed by the applicant on 19 January 2017. Relevant factual allegations are summarised below.
Employment periods
The applicant alleged the following periods of employment:
a)from 9 February 2008 to about 28 July 2011 he was employed by Goddard Lane Pty Ltd (“Goddard Lane”) (a scrap metal yard business operated by the second respondent and his son) as a caretaker and machine operator on a full-time permanent basis;
b)from about 28 July 2011 to 31 March 2014 he was employed by the first respondent also as a caretaker and machine operator on a full-time permanent basis; and
c)from 7 April 2014 to 13 October 2014 he was employed by the first respondent on a permanent part-time basis, working one day a week.
The applicant alleged that he was a transferring employee from Goddard Lane to the first respondent pursuant to s.311 of the FW Act and, consequently, was considered to have been in continuous service with the first respondent since 9 February 2008.
Coverage
The applicant alleged that at the commencement of his employment in 2008 he entered into an oral agreement with the first respondent that he would be paid $1,000 gross per week for working 38 hours from Monday to Friday (“Agreement”). He alleged that this Agreement was a safety net contractual entitlement pursuant to s.542 of the FW Act.
The applicant alleged that prior to 1 January 2010, he was covered by the Miscellaneous Workers’ General Services (State) Award (“State Award”). From 1 January 2010 he was covered by the Modern Award and performed duties commensurate with the Grade 1 Classification as set out in sch.B.
Underpayment of wages
The applicant alleged that in contravention of s.542 of the FW Act, the first respondent failed to pay him $1,000 per week for each week worked in the period 7 January 2013 to 31 March 2014.
Further and in the alternative, the applicant alleged that he was entitled to be paid the minimum hourly rate as set out in cl.14.1 of the Modern Award, being:
a)from 7 January 2013 to 30 June 2013, a minimum weekly rate of $640.20; and
b)from 1 July 2013 to 31 March 2014, a minimum weekly rate of $659.40.
It was alleged that the first respondent did not pay the applicant any wages during the period 7 January 2013 to 31 March 2014. The applicant alleged that the first respondent therefore breached cl.14.1 of the Modern Award and thus contravened s.45 of the FW Act.
Annual leave
The applicant alleged “non-payment of annual leave from 7 January 2013 to 31 March 2014”.
The applicant alleged that the first respondent was required by s.90(2) of the FW Act to pay him his accrued annual leave on termination of his employment. The applicant alleged that by failing to do so the first respondent contravened s.44 of the FW Act.
Superannuation
The applicant alleged “non-payment of superannuation from 1 July 2010 to 31 March 2014”.
The applicant alleged that prior to the commencement of the Modern Award on 1 January 2010, the first respondent was required by cl.40 of the State Award to make superannuation contributions on his behalf. From 1 January 2010, the relevant provision was cl.20 of the Modern Award, quoted earlier.
The applicant alleged that the first respondent failed to make full superannuation contributions on his behalf in breach of cl.20 of the Modern Award (and in contravention of s.45 of the FW Act).
Adverse action
The applicant alleged that on 13 October 2014 he made a complaint or an inquiry about the non-payment of his wages to the second respondent who summarily terminated his employment as a result. He alleged that this conduct amounted to adverse action for a prohibited reason (and in contravention of s.340 of the FW Act).
Notice of termination and pay in lieu of notice
The applicant alleged that he was dismissed on 13 October 2014 and that at that time he was entitled to five weeks’ written notice of termination pursuant to s.117(1) and (3) of the FW Act. It was alleged that the first respondent contravened s.44 of the FW Act because it failed to provide him with written notice of termination or a payment in lieu thereof.
Pay slips
The applicant alleged that the first respondent did not provide him with any pay slips from 3 July 2009 and thus contravened s.536 of the FW Act.
Long service leave
The applicant alleged that pursuant to s.4 of the LSL Act, he was entitled to be paid 5.321 weeks of long service leave in the amount of $1,000 per week, calculated from the period 9 February 2008 to 31 March 2014.
The applicant alleged that he was owed long service leave in the amount of $5,321.85 at the time his employment was terminated.
Involvement of the second respondent
The applicant alleged that the second respondent was the manager of the first respondent and was responsible for its carriage, control and conduct. It was also alleged that he was responsible for the supervision and management of the applicant and was involved in terminating the applicant’s employment.
It was alleged that prior to the contraventions, the second respondent had knowledge that:
a)the applicant was not paid $1,000 per week from 3 [sic] January 2013 to 31 March 2014;
b)the applicant was entitled to accrue annual leave, that unused annual leave accrued from year to year and that the applicant had accrued annual leave which was owing at the time of termination;
c)the first respondent did not make superannuation contributions to the applicant’s account;
d)the applicant was not provided with written notice of termination and was not paid out his notice period;
e)the applicant did not receive pay slips; and
f)the applicant had long service leave owing to him at the time of termination.
It was alleged that the second respondent was liable for the non-payment of long service leave pursuant to ss.10A and 10B of the LSL Act. At the trial the applicant did not contend that the second respondent had been a director of the first respondent and he accepted that the first respondent was an age pensioner.
RESPONSE/DEFENCE
The respondents filed a response and an (amended) defence on 1 September 2017. In their response the respondents consented to the making of various declarations concerning, and orders against, the first respondent. However, as noted earlier, the first respondent is in liquidation and so that part of the proceeding that concerns it “is not to be proceeded with”: s.500(2) of the Corporations Act.
In the statement of claim the first respondent also made certain admissions but they do not bind the second respondent who either denied or did not admit all the allegations made in the statement of claim.
APPLICANT’S EVIDENCE
Eugene Chambers
Commencement of employment
The applicant deposed that he commenced his employment at Goanna Tracks MX and Enduro Complex (“MX Track”) on 10 February 2008. The MX Track was situated approximately 30 kilometres from Coonabarabran and was managed and operated by the Cromb family.
The applicant deposed that in the week prior to the commencement of his employment he met with Mr Cromb, the second respondent’s son, to discuss the specifics of his position. During that meeting, Mr Cromb advised him that:
a)he would be employed full-time as caretaker and machine operator;
b)the position paid $1,000 gross per week and included accommodation and “tucker”;
c)he would be required to live in a caravan at the MX Track from Sunday midday to Friday midday each week; and
d)his duties would include getting the dirt tracks ready, clearing the land and acting as a caretaker of the MX Tracks during the week.
The applicant deposed that he had been informed by his wife and “vehemently believe[d]” that on the weekend prior to the commencement of his employment, both Mr Cromb and the second respondent came to his house and confirmed his employment.
The applicant deposed that he kept diaries throughout his employment in which he made brief notes about his work, start and finish times, leave, and persons responsible for approving leave.
Direction and supervision
The applicant deposed that upon commencing work he received most of his instructions from the second respondent, who was at the MX Track more often than Mr Cromb. Mr Cromb lived and worked in Tamworth at the time.
The applicant deposed that during the first two years of his employment he would contact Mr Cromb by telephone during the week to ask him about matters relating to his work as Mr Cromb was generally more contactable than the second respondent. However, he received most of his instructions from the second respondent and would run things by him throughout his employment at the MX Track.
The applicant deposed that he never had any discussions with the second respondent or Mr Cromb about who was the “boss”. He took any and all directions from either of them but considered the second respondent to be the “big boss” because he appeared to have overall say in everything. He deposed that he noticed that Mr Cromb would often run things by the second respondent and always followed the second respondent’s directions in response.
The applicant deposed that sometime around 20 September 2010 the second respondent started living permanently at the MX Track. As a consequence, the applicant ceased living at the premises during the week although he continued to be paid $1,000 a week.
The applicant deposed that in the subsequent period, with the second respondent being present each day he worked at the MX Track, he received his instructions regarding work to be done from the second respondent. He also spoke to the second respondent about all facets of his employment and it was the second respondent who authorised his requests for leave.
The applicant deposed that at no time did the second respondent say to him words to the effect of “Grant told me to tell you …”. He deposed that the second respondent gave no indication that any directions were anything other than directly from him.
Bushfire in January 2013
The applicant deposed that he was not informed of the change to his employer on 28 July 2011 and his role after this period did not change in any way.
The applicant deposed that issues with his pay arose in November and December 2012. During this period, he received his wages partly in cash and in varying amounts, whereas before his wages had always been deposited directly into this bank account. The applicant deposed that the last of his regular weekly salary payments were paid into his bank account on 4 and 7 January 2013; after this period, he received no further payments to his bank account from or on behalf of the first respondent.
The applicant deposed that there was a bushfire in the area around Coonabarabran on 13 January 2013. The MX Track was not affected by the fire.
On 16 January 2013 the applicant had a conversation with Mr Cromb, who said words to the following effect:
a.most people will think that the MX Track had been damaged by the fires;
b.we anticipate that there will be less regular patrons and no events being held at the MX Track for some time; and
c.can you continue working and you will be paid once things improve.
The applicant deposed that he had no issue agreeing to this as he liked his job and trusted that he would get paid. At no time was he advised that his full-time position had changed, been terminated or made redundant, or that he was a casual employee.
The applicant deposed that in the week or so following the bushfire,
Mr and Mrs Cromb took him into Coonabarabran and helped him fill out a Centrelink application for financial assistance. He deposed that the reason given by Mr and Mrs Cromb was that they were unable to pay him his normal wages because of the bushfire.
13 January 2013 to 31 March 2014
The applicant deposed that in the period 13 January 2013 to 31 March 2014 he continued to work full-time at the MX Track without payment.
The applicant deposed that because he was not being paid, he started working elsewhere on weekends and public holidays while his wife was forced to take out at least two personal loans.
The applicant deposed that he received financial assistance from Centrelink but because his wife was working he did not receive substantial amounts and what he did receive paid for the fuel which enabled him to drive to and from the MX Track each day.
The applicant deposed that on or around 25 July 2013 he asked the second respondent about being paid for some of the work he had done since 7 January 2013 and was given $1,000 in cash as a result. He made a further request of the second respondent in the weeks prior to Christmas 2013 and was paid $5,000 in cash by Mr Cromb on 19 December 2013.
Post March 2014
The applicant deposed that on or about 31 March 2014 he had a conversation with the second respondent to the following effect:
MR CHAMBERS: Can I get paid?
SECOND RESPONDENT: We can’t afford to keep you going. You will only be working one day per week from now on and we will pay you $150.00.
MR CHAMBERS: Ok but if I am required to work on other days I want to be paid my normal rate of $200.00 per day.
SECOND RESPONDENT: OK.
The applicant did not ask the second respondent about moneys owed to him at the time because he continued to believe that he would be paid as soon as the first respondent was in a financial position to pay him.
The applicant deposed that after this conversation he worked one day a week, usually on Mondays, for $150. If he worked additional days, he was paid $200 a day. The second respondent was usually the one to advise him if he was required to work extra days.
The applicant deposed that in the week of 6 October 2014 the second respondent asked him to work an extra three days on top of his usual one day to assist with an event that was being held at the MX Track the following week, which he did.
On Monday 13 October 2014 the second respondent paid him $600 in cash. The applicant deposed that they then had a conversation to the following effect:
SECOND RESPONDENT: This is payment for the previous week.
MR CHAMBERS: (On counting the money) this is not enough; I had worked for three days and you had only paid me $450.00 for the extra three (3) days. Our agreement [was] that I [would] be paid $200.00 per day for any extra days I worked beyond my normal one day on Mondays.
SECOND RESPONDENT: I had never agreed to this, if this is the way you want to go, then I [sic] could just leave.
The applicant left the property following this conversation. He deposed that he felt depressed and anxious about the manner in which his employment had been terminated after so many years.
The applicant deposed that at no time during the period 13 January 2013 to 13 October 2014 was he advised that he was employed on a casual basis. He deposed that during this period he had been offered casual and contract work by other employers on numerous occasions which he had turned down (unless it was on a weekend or a public holiday) because of his belief that he had been employed on a full-time basis by the first respondent. He deposed that he would have taken up these offers if he had known otherwise, particularly given that he was not being paid for his ongoing full-time weekly hours.
First respondent entities
The applicant deposed that he stopped receiving pay slips as from 3 July 2009. Prior to this, Mr Cromb normally provided him with three or four weekly pay slips at a time.
The applicant deposed that according to his bank statements and the pay slips he received he was paid by the following entities during his employment:
a)from April 2008 to July 2009, by Goddard Lane;
b)from 24 August 2009 to 12 November 2010, by TG and GT Cromb;
c)from 19 November 2010 to 27 May 2011, by GT and DT Cromb;
d)from 3 June 2011 to 21 October 2011, by Mrs Cromb with the reference “GT and DT Cromb”;
e)on 28 October 2011, by CBA Netbanking with the reference “Salary Goanna Trac”; and
f)on 11 November 2011, by CBA Netbanking with the reference “Goanna MX”. The applicant deposed that this payment method remained predominately the same until the final payment in January 2013.
Annual leave
The applicant deposed that according to his diaries, he took a total 54 days annual leave during his employment with the first respondent.
Superannuation
The applicant deposed that he asked Mr Cromb and the second respondent about his superannuation on more than one occasion. Both men told him on separate occasions that they would fix the issue.
After he was terminated, the applicant realised that the first respondent had not made superannuation contributions to his nominated fund. He sought the assistance of the Australian Taxation Office (“ATO”) the results of which included:
a)on 10 October 2014 he received a letter from the ATO advising him that it was unable to recover any superannuation on his behalf because Goddard Lane had been deregistered on 18 August 2013;
b)on 12 December 2014 he received a further letter from the ATO advising him that his employer in the period 1 October 2011 to 30 June 2012 was Goddard Lane, not the Trustee for Goanna Tracks Trust i.e the first respondent. As Goddard Lane had been deregistered, the ATO was unable to recover any superannuation on his behalf;
c)on 11 March 2015 he was advised that the ATO had established that he was owed an amount of $2,790 from the Trustee for Goanna Tracks Trust for the period 1 July 2012 to 31 March 2013. As a result of this, on 10 July 2015 a total of $3,542.54 was transferred to his superannuation account; and
d)on 6 May 2015 he was advised that the ATO had established that he was owed an amount of $9,701.01 by TG and GT Cromb for the period 1 July 2009 to 31 December 2011. As a result of this, on 15 January 2016 an amount of $14,251.96 was transferred to his superannuation account.
The applicant deposed that he had not been able to recover unpaid superannuation payments from the first respondent for the periods 1 January 2012 to 30 June 2012 and 1 April 2013 to 31 March 2014. He calculated that he was still owed $7,150.00 in unpaid superannuation.
Losses suffered
The applicant deposed that he had suffered from growing stress and anxiety as a result of not being paid. In mid-2013 he was diagnosed with depression and started to take prescription medication.
The applicant deposed that his wife had had to apply for a number of loans in 2013 and 2014 (totalling approximately $22,000) to maintain their household. She also borrowed money from their older children. These matters increased his stress significantly, which continued as he attempted to recover some of his superannuation.
In 2015 the applicant applied for an early release of some of his superannuation. He deposed that $17,000 was released and used to pay normal household expenses.
The applicant deposed that he continued to feel humiliated and offended for having accepted the word of the second respondent and Mr Cromb. He deposed to having lost his trust in people as a result of the respondents’ actions.
Vicki Chambers
Mrs Chambers is the applicant’s wife. Her affidavit evidence was generally corroborative of her husband’s evidence.
Mrs Chambers also gave evidence of the financial, mental and physical impact she said her family suffered as a result of the respondents’ failure to pay her husband his entitlements.
RESPONDENTS’ EVIDENCE
Tom (Thomas) Cromb
Scrap metal business
The second respondent deposed that he purchased a scrap metal yard business in Tamworth in 1982 or 1983. In 1994 his son, Mr Cromb, became a partner in the business which from that time operated as TG & GT Cromb trading as Cromb Scrap Metal. In 2000, he and his son purchased the premises on which the business operated.
The second respondent deposed that he retired in 2009.
MX Track
In about 2007 the second respondent’s son purchased a property in Coonabarabran, which became the MX Track, using assets from the partnership. The second respondent deposed that at the time he was getting ready to retire and was going to leave the partnership business to his son to run as he wished. He deposed that he had supported his son in pursuing his own interests but had had no desire himself to run a motocross park. In cross-examination when asked if his son and he had owned the Motocross premises the second respondent said, “back in about 2007, I think it was… Yes”.
The second respondent deposed that his son employed the applicant in early 2008 as a caretaker to live at the MX Track during the week. In cross-examination the second respondent agreed that he had had discussions with his son in regards to employing a caretaker and had been involved during that process and knew the details of the applicant’s employment.
In February 2011 the second respondent moved into one of the cabins at the MX Track. He deposed that in the period between the purchase of the MX Track and when he moved there, he went to the track on some weekends to help develop and maintain the motocross tracks and build associated infrastructure. He did this to help his son. In cross-examination the second respondent said “I always have worked around the premises giving a helping hand”. When asked about the kind of work done he added, “just general work, repairing machinery and so forth like that”. During this period and at his son’s request, he would occasionally pass on instructions to the applicant. In cross-examination he agreed that he was regularly in touch with the applicant, would seek assistance from the applicant performing his tasks around the premises and on most occasions, was the go-between between the applicant and Mr Grant.
The second respondent deposed that from February 2011 to about mid-2013, his son was out at the MX Track almost every day and was often assisted by the applicant. Occasionally, if his son was not there or was unavailable, the applicant would ask him what to do. In the period after the January 2013 bushfire when his son was adding to his income by working as an excavator operator, Mr Cromb supervised the applicant.
The second respondent deposed that while he did not pay rent on his cabin, he paid rent in kind by performing maintenance work at the MX Track. He was not paid for any of his work and had never received any proceeds from the takings of the MX Track. He said he had never been an employee of Goanna MX.
Mr Chambers’s casual employment
The second respondent deposed that shortly after the bushfire in January 2013 he spoke to his son who advised him that he would have to reduce the applicant’s hours of work to one or two days a week. At about this time, he noticed that the applicant ceased coming to the MX Track every day.
The second respondent deposed that it was also around this time that his son started working as a contractor. Shortly afterwards, his son said to him words to the effect of:
I’ve spoken to [the applicant] about casual work. We’ve agreed he’ll be paid $150.00 a day for each day he comes out here. If you need a hand with anything, give him a call.
The second respondent deposed that during the period when his son was a contractor, he helped him maintain the MX Track. Whenever he needed assistance, he was told by his son to call the applicant and at the end of each day that the applicant worked, he would pay him $150 cash from the till. If the till did not have enough money, he would call his son who then would arrange to pay the applicant. In cross-examination, when asked if he was required to pay the applicant, the second respondent said, “I wasn’t required to pay him at all. I would give him money when – when we had it in the till”. He later said, “I never – never paid wages to him at all. I only paid day rates every now and then.”
The second respondent deposed that in about mid or late 2014, the applicant told him that he wanted to be paid $200 a day. He deposed that he had said no and that the applicant responded by leaving the track.
The second respondent deposed that at no time did the applicant say to him that he had not been paid or that he was owed money. He said the applicant had never asked him for money owed to him and he did not recall ever speaking to the applicant about the latter’s superannuation. When asked in cross-examination about applicant’s superannuation the second respondent said, “I never had any conversation with him about superannuation whatsoever”.
Grant Cromb
The applicant’s full-time employment: February 2008 to January 2013
Mr Cromb deposed that he and his father used to own Goddard Lane, a company which employed the employees of their scrap metal yard business and managed, amongst other things, payroll.
In 2007 he purchased, using partnership assets, the MX Track property. He deposed that he employed the applicant in February 2008 to act as a caretaker and labourer at the track because he was concerned that someone might break in and steal plant and equipment. He deposed that the applicant’s duties included living at the track from Sunday to Thursday night.
Mr Cromb deposed that until about February 2011 he spent most of his weekends at the track. During this period, on most Sunday nights before returning to his home in Tamworth would wait for the applicant to arrive so that he could tell him about any work that needed to be done over the following week.
Mr Cromb deposed that his father would sometimes go to the MX Track on the weekends when he had other commitments. On those occasions, he often asked his father to pass on his instructions to the applicant.
Mr Cromb deposed that telephones were installed at the MX Track in about late 2009 or early 2010. Thereafter, he also spoke to the applicant on the telephone if he needed him to perform any specific work.
Mr Cromb deposed that in about 2009 he and his father entered into an agreement to sell the scrap metal yard business. The sale was structured to take place over a number of years and was to conclude in about 2011. The money made from the sale of the business was used to fund the development of the MX Track, to pay the applicant, and to pay for
Mr Cromb’s family’s expenses. In about late 2009 or early 2010 his father retired from the partnership.
Mr Cromb deposed that shortly after the death of his step-mother, he and his father had a conversation to the following effect:
SECOND RESPONDENT: I don’t want to be in Tamworth any more. There’s nothing for me here. Do you mind if I live at the track?
MR CROMB: Sure Dad, that’s fine.
SECOND RESPONDENT: I don’t want to work out there, I’m retired. I’ll help out when you need me though. I’m happy to be the caretaker living out there.
MR CROMB: Sure Dad.
Mr Cromb deposed that he and his family moved to a house in Coonabarabran in February 2011. Thereafter, he spent most of his days at the track.
Mr Cromb deposed that his father moved into one of the cabins at the MX Track also in about February 2011. He deposed that his father worked at the track as and when he wanted to. Because the second respondent was living at the track, Mr Cromb told the applicant that he no longer needed to stay there at night.
Mr Cromb deposed that in about early 2011 Goanna MX was registered for the purpose of running the business. At about this time, he had a conversation with the applicant to the following effect:
MR CROMB: Because the business in Tamworth has been sold we’re shutting down that company. You still have a job here but not with Goddard Lane. We’re starting a new company for the track and you’ll work for it.
MR CHAMBERS: No worries.
Mr Cromb deposed that towards the end of 2012 the MX Track was not making much money and was not able to meet its expenses. Occasionally, there was not enough money in the operating account to pay the applicant’s wages and when this occurred Mr Cromb would take cash from the till to pay him.
The applicant’s casual employment: from January 2013
Mr Cromb deposed that shortly after the bushfire in January 2013 he had a conversation with the applicant in words to the following effect:
MR CROMB: Things are going to be really quiet. I’m going to try and keep you on but things are going to be tough.
MR CHAMBERS: What do you mean?
MR CROMB: Well, we’re not going to be able to pay you. We’ve got no money and it’s going to be quiet here.
MR CHAMBERS: Well, I want to keep working.
MR CROMB: If that’s what you want to do. We’ll try to pay you when we can.
Mr Cromb deposed that about a week or so later he found out that a relief centre had been set up in Coonabarabran and helped the applicant apply for a Centrelink benefit so that he would have some funds.
Mr Cromb deposed that about a month or six weeks after the bushfire, he and the applicant had another conversation to the following effect:
MR CROMB: We’re not earning any money here. Things aren’t picking up. We need to talk about your work.
MR CHAMBERS: What do you mean?
MR CROMB: We’re not going to be able to keep you on. I still want you to work here but it can’t be full-time.
MR CHAMBERS: Well, I understand that. What’s it going to be then?
MR CROMB: We can pay you $150.00 a day but it will only be when we can afford it.
MR CHAMBERS: Should I look for other work?
MR CROMB: Yes. Do that.
MR CHAMBERS: Well, if you call me and I’ve got work on, I’ll be doing that:
MR CROMB: OK.
Mr Cromb deposed that he started working as a contractor at around this time in order to support his family. He did this work for about two years. During this time, he was not at the MX Track very often and his father performed most of the maintenance and other work around the track. He told his father to contact the applicant if he needed assistance and that they (i.e. he and the applicant) had agreed to a rate of $150 per day.
Mr Cromb deposed that he initially called the applicant to work about once a week but that this tapered off over 2013.
Entitlements
Mr Cromb deposed that he knew that the applicant was owed money for his termination but had not been able to pay it. He deposed that he paid the applicant from time to time when money was available but did not make records of all those payments. He recalled that the applicant was paid $1,000 in July 2013 and $5,000 in December 2013 but believed that additional payments had been made.
Foreclosure
Mr Cromb deposed that in about March 2014 the first respondent’s mortgagee foreclosed on the MX Track. As a result, he no longer owned the property but had an agreement with the mortgagee that allowed him to continue running the business.
Mr Cromb deposed that the MX Track continued to operate but the business did not generate enough profit to support his family. As a consequence, he also worked as a truck driver.
Donna Cromb
Mrs Cromb is Mr Cromb’s wife. Her affidavit evidence was generally corroborative of her husband’s evidence.
Mrs Cromb also deposed that she had been employed by Goddard Lane as a bookkeeper and had been responsible for, amongst other things, running the payroll each week. She said that Goddard Lane belonged to her husband and his father.
Mrs Cromb deposed that Mr Cromb had hired the applicant in 2008 and put him on Goddard Lane’s payroll. The applicant was then paid by Goddard Lane until it shut, at which point he was paid from Mr and Mrs Cromb’s bank account.
Mrs Cromb deposed that Goddard Lane was shut down in 2011 and a new company created for the purposes of running the MX Track, Goanna MX, of which she was the sole director and shareholder. She deposed that the applicant was the only employee of Goanna MX and the same payroll system was used to process his pay.
Mrs Cromb deposed that she and her husband helped the applicant apply for a Centrelink benefit as, following the bushfire, they could not keep him employed on a full-time basis. After doing so, she stopped paying the applicant and understood that he was aware that he was no longer employed by Goanna MX.
CONSIDERATION
The absence of the second respondent from the first part of the hearing meant that the applicant and his wife were not cross-examined on their affidavits and so I did not have the opportunity to assess them as witnesses. Similarly, although Mr and Mrs Cromb’s affidavits were read, they were not available for cross-examination. The only witness who was cross-examined was the second respondent. In those circumstances, it would be unwise to attempt any significant credibility findings other than to observe that I found the second respondent straightforward and direct. Such conclusions as have been necessary on divergent evidence, and the evidence more generally, are set out in the following discussion.
Underpayment of wages 7 January 2013 to 31 March 2014
The applicant’s case was that after the bushfire in January 2013 he continued to work full-time at the MX Track until 31 March 2014 although the fire had significantly and adversely affected patronage. He said that the first respondent could not afford to pay him at that time but he reached an arrangement with Mr Cromb that payment of his wages would be postponed to a time when the business was more successful. The applicant said that from the end of March 2013 he started to do work elsewhere to have some ready money and at the end of March 2014 his work at the MX Track was reduced to one day a week plus additional work as required.
On the other hand, Mr Cromb’s evidence was that the business’s financial position was such that within a month or six weeks of the bushfire the applicant’s hours were reduced to one day per week at $150 per day and he was free to seek other work. The second respondent’s evidence was that after the fire the applicant worked one or two days a week and was paid $150 per day. It was in this period after the bushfire that Mr Cromb started doing excavation work to make some money.
Both the applicant and Mr Cromb agreed that the latter had taken the former to a Commonwealth Government relief centre that had been set up in Coonabarabran following the bushfire and had helped him register for social security benefits.
I find the applicant’s allegation of continued full-time permanent work inherently unlikely. It is implausible that suffering a significant reduction in patronage, with Mr Cromb having to find work elsewhere and the second respondent living on site and willing to perform tasks, that the applicant would have been retained to work full-time. It is also implausible that Mr Cromb would have been willing to accrue a significant debt to the applicant in ostensible contravention of the FW Act. The trip to the relief centre to arrange social security benefits also appears inconsistent with the applicant working full-time, even if he was not actually receiving his wages.
I am not persuaded that the applicants’ full-time permanent employment continued until 31 March 2014 and believe that it ended six weeks after the January 2013 fire. I find that the applicant’s recollection in this regard was mistaken and may possibly have been affected by the fact that in summer 2013-2014 he did work something like full-time hours, or so it appears from the pages of his diary annexed to his affidavit of 18 September 2017.
The parties disagreed on how many days the applicant worked after the January 2013 fire but I was impressed by the detail of the applicant’s diary records, and on which he was not cross-examined, and I prefer them to the unspecific and generalised recollections of the second respondent and Mr Cromb. Importantly for present considerations, they record a pattern of work more in keeping with casual employment rather than permanent part-time work. I find that from 24 February 2013 the applicant’s employment was casual and so he has not made out his claim to underpayment of full-time wages in the period 7 January 2013 to 31 March 2014.
It is not possible on the evidence that was adduced to determine if, and if so to what extent, the applicant was underpaid in the six-week period following the January 2013 fire, apart from observing that annexed to Mrs Cromb’s affidavit were pay records suggesting that on 11 January 2013 the applicant was paid wages of $1000 gross, which suggests that he was not underpaid his wages in that week.
Non-payment of annual leave 7 January 2013 to 31 March 2014
Because I have found that the applicant was not employed on a full-time permanent basis for the entirety of the period 7 January 2013 to 31 March 2014, I find that he has not made out his claim to unpaid annual leave in respect of the period. Under the NES, annual leave is not an entitlement of casual employees.
Nonetheless, the applicant is entitled to payment for such leave entitlements as accrued in respect of the period 7 January 2013 to 24 February 2013 when he was still employed on a permanent full-time basis. I infer that he has not been paid that amount and is entitled to compensation from the first respondent in respect of it.
Non-payment of superannuation contributions 1 July 2010 to 31 March 2014
Based on the relevant heading in his statement of claim, which refers to a period before the applicant’s employment with the first respondent, the applicant’s claim to an entitlement to unpaid superannuation contributions appears to depend significantly on his allegation that his employment with the first respondent had been transferred to it from Goddard Lane. This is because, under s.22(5) of the FW Act, service with one employer counts as service with another employer if there is a transfer of employment in relation to a “national system employee”.
Section 22(7) of the FW Act provides that:
(7)There is a transfer of employment of a national system employee from one national system employer (the first employer) to another national system employer (the second employer) if:
(a) the following conditions are satisfied:
(i) the employee becomes employed by the second employer not more than 3 months after the termination of the employee’s employment with the first employer;
(ii) the first employer and the second employer are associated entities when the employee becomes employed by the second employer; or
(b) the following conditions are satisfied:
(i) the employee is a transferring employee in relation to a transfer of business from the first employer to the second employer;
(ii) the first employer and the second employer are not associated entities when the employee becomes employed by the second employer.
Section 12 of the FW Act provides that “associated entity” has the meaning given by s.50AAA of the Corporations Act, which in turn provides:
50AAA Associated entities
(1)One entity (the associate) is an associated entity of another entity (the principal) if subsection (2), (3), (4), (5), (6) or (7) is satisfied.
…
(7) This subsection is satisfied if:
(a)an entity (the third entity) controls both the principal and the associate; and
(b)the operations, resources or affairs of the principal and the associate are both material to the third entity.
Section 50AA of the Corporations Act provides:
50AA Control
(1)For the purposes of this Act, an entity controls a second entity if the first entity has the capacity to determine the outcome of decisions about the second entity’s financial and operating policies.
(2) In determining whether the first entity has this capacity:
(a)the practical influence the first entity can exert (rather than the rights it can enforce) is the issue to be considered; …
Section 64A of the Corporations Act provides that an individual may be an entity.
The evidence supports a conclusion that Mr Cromb was in a position to exercise over Goddard Lane, at least in relation to the operation of the MX Track and the applicant’s employment, and also over the first respondent, the sort of influence which s.50AA of the Corporations Act considers “control”. That means that the two companies were associated entities pursuant to s.50AAA(7) of that Act. In those circumstances and given the effective continuity of the applicant’s employment, I find that there was a transfer of his employment from Goddard Lane to the first respondent under s.22(7)(a) of the FW Act.
In those circumstances, it is not necessary to consider s.22(7)(b) of the FW Act or s.311 of that Act which relevantly provides:
311 When does a transfer of business occur
Meanings of transfer of business, old employer, new employer and transferring work
(1) There is a transfer of business from an employer (the old employer) to another employer (the new employer) if the following requirements are satisfied:
(a) the employment of an employee of the old employer has terminated;
(b) within 3 months after the termination, the employee becomes employed by the new employer;
(c) the work (the transferring work) the employee performs for the new employer is the same, or substantially the same, as the work the employee performed for the old employer;
(d) there is a connection between the old employer and the new employer as described in any of subsections (3) to (6).
Meaning of transferring employee
(2) An employee in relation to whom the requirements in paragraphs (1)(a), (b) and (c) are satisfied is a transferring employee in relation to the transfer of business.
Transfer of assets from old employer to new employer
(3) There is a connection between the old employer and the new employer if, in accordance with an arrangement between:
(a) the old employer or an associated entity of the old employer; and
(b) the new employer or an associated entity of the new employer;
the new employer, or the associated entity of the new employer, owns or has the beneficial use of some or all of the assets (whether tangible or intangible):
(c) that the old employer, or the associated entity of the old employer, owned or had the beneficial use of; and
(d) that relate to, or are used in connection with, the transferring work.
Old employer outsources work to new employer
(4)There is a connection between the old employer and the new employer if the transferring work is performed by one or more transferring employees, as employees of the new employer, because the old employer, or an associated entity of the old employer, has outsourced the transferring work to the new employer or an associated entity of the new employer.
New employer ceases to outsource work to old employer
(5)There is a connection between the old employer and the new employer if:
(a)the transferring work had been performed by one or more transferring employees, as employees of the old employer, because the new employer, or an associated entity of the new employer, had outsourced the transferring work to the old employer or an associated entity of the old employer; and
(b)the transferring work is performed by those transferring employees, as employees of the new employer, because the new employer, or the associated entity of the new employer, has ceased to outsource the work to the old employer or the associated entity of the old employer.
New employer is associated entity of old employer
(6)There is a connection between the old employer and the new employer if the new employer is an associated entity of the old employer when the transferring employee becomes employed by the new employer.
However, the significance of that issue for the applicant’s claim to unpaid superannuation contributions is not apparent. In the statement of claim it was said that “Calculations for unpaid superannuation will be provided with the evidence”. In his affidavit sworn 18 September 2017 the applicant deposed that superannuation contributions were not made for him in respect of the following periods, in contravention of cl.20 of the Modern Award quoted earlier:
1 January 2012 to 30 June 2012, 26 weeks at $1,000.00 at 9% = $2,340.00
1 April 2013 to 31 March 2014, 52 weeks at $1,000.00 at 9.25% = $4,810.00
That is to say, the applicant did not claim superannuation contributions related to his employment with Goddard Lane.
Noting that no evidence was adduced to contradict the applicant’s evidence on the question, and indeed the payroll records annexed to Mrs Cromb’s affidavit confirm it in relation to the months of January to June 2012, I accept that the first respondent did not make superannuation contributions for the applicant in respect of the periods he has identified. However, although I accept that the first respondent failed to pay superannuation contributions totalling $2,340 in respect of the first six months of 2012, the applicant has not demonstrated that he worked on a full-time basis from 1 April 2013 to 31 March 2014 and so the figure he has proposed in relation to that period is not correct. Further, the superannuation guarantee charge percentage did not rise to 9.25% until 1 July 2013: s.19 Superannuation Guarantee (Administration) Act 1992. Before a quantification of the applicant’s unpaid superannuation entitlements could be made, it would be necessary to understand how many days the applicant worked for the first respondent between 1 April 2013 and 31 March 2014. The applicant’s diary entries require some elucidation before a total could be stated with confidence.
Termination on 13 October 2014 – adverse action
In his statement of claim the applicant alleged that he was dismissed because he made a complaint or enquiry about “payment for work performed”. The respondents’ position was that he walked out when the second respondent refused his request to be paid $200 per day for every day worked after the first day worked in a given week. The applicant was not cross-examined on his affidavits because the second respondent had not appeared at that point of the hearing but, once the latter did appear by telephone, his evidence in cross-examination was clear and persuasive in its rejection the applicant’s version of events.
But, in any event, I have found that at the time in question the applicant was not employed on a full-time permanent basis and so was not owed the amounts he claims and which I infer were the subject of the alleged demand for payment. I therefore find that he did not make the demand he alleges and so was not dismissed for having done so.
Notice of Termination and Payment in Lieu of Notice
I have found that the applicant was not dismissed from his employment with the first respondent on 13 October 2014 as he alleged. Consequently, he was not entitled to a notice of termination or pay in lieu of notice at that time.
Failure to Provide a Pay Slip
The applicant alleged that he was not provided with pay slips from 3 July 2009 onwards, a claim that the respondents denied. His evidence was not contradicted and I accept it. However, the period alleged covers some of the applicant’s employment with Goddard Lane, which is not relevant to this proceeding.
I find that the first respondent never provided the applicant with a pay slip.
Failure to pay long service leave for period 9 February 2008-31 March 2014
Generally, an entitlement to long service leave, or payment in lieu, accrues if an employee has completed at least ten years’ service. Although I have found that the applicant’s employment was, for the purposes of the FW Act, transferred to the first respondent from Goddard Lane, that does not determine the equivalent issue under the LSL Act. Section 4(11)(c) of that Act requires there to have been the transmission of “a business, undertaking or establishment or any part thereof” from one employer to another, and a transfer of a person’s employment as part of that transmission, before the period of employment with the first employer will be deemed to be employment with the second employer.
In this case, it is not clear who ran the MX Track business before the first respondent was incorporated and whether the trust was a relevant entity in that earlier period. However, as the MX Track was purchased using partnership funds, I will infer that Goddard Lane ran the business until the first respondent started to. On that basis I find that the applicant’s period of service was not broken by reason of the transmission of his employment from Goddard Lane to the first respondent and so at the time his full-time permanent employment concluded he had, even on his own view of when that occurred, for the purposes of the LSL Act a period of service of less than seven years.
Under the LSL Act, that length of service does not entitle an employee to any long service leave or payment in lieu unless, relevantly for present considerations, he or she is dismissed in the circumstances set out in s.4(1)(a)(iii) of the LSL Act. It is implicit in the findings I have made concerning the applicant’s allegation concerning the length of his full-time permanent employment that it did not conclude on 1 April 2014 as he alleged. I find that it was terminated by the first respondent because of slackness of trade on 24 February 2013, which is slightly more than five years after the applicant’s employment with Goddard Lane commenced. Consequently, he was entitled to have received from the first respondent, presumably in 2013, a payment in respect of long service leave reflective of that period of continuous employment.
Tom Cromb’s alleged liability as an accessory
Alleged contraventions of the Fair Work Act
Although I accept that on various occasions the second respondent gave directions to the applicant, told him when he might come to perform work and made cash payments to him, that is not sufficient to prove that he had personal liability for the few underpayments which I find occurred or for the first respondent’s failure to provide pay slips. In that regard attention needs to be paid to the application and statement of claim which commenced this proceeding and which have not been amended.
In the application the applicant relevantly sought declarations that the second respondent had:
i.Contravened section 542 of the Fair Work Act 2009 by failing to pay the applicant $1000 gross salary per week from
7 January 2013 to 31 March 2014.
ii.In the alternative to 2(i) above, contravened section 45 of the Fair Work Act 2009 by failing to pay the applicant pursuant to clause 14 of the Award from 7 January 2013 to 31 March 2014;
iii.Contravened section 44 of the Fair Work Act 2009 by failing to pay the applicant accrued annual leave on termination of employment pursuant to section 90 of the FW Act;
iv.Contravened section 45 of the Fair Work Act 2009 by failing to pay the applicant superannuation contributions pursuant to clause 20 of the Award;
v.Contravened section 340 of the Fair Work Act 2009 by taking adverse action against the applicant on 13 October 2014 because he had a workplace right;
vi.Contravened section 44 of the Fair Work Act 2009 by failing to provide the applicant with written notice on termination pursuant to section 117 of the FW Act;
vii.Contravened section 44 of the Fair Work Act 2009 by failing to pay the applicant payment in lieu of notice pursuant to section 117 of the FW Act;
viii.Contravened section 536 of the Fair Work Act 2009 by failing to provide the applicant with a pay slip.
ix. Breached section 4 of the Long Service Leave Act 1955 (NSW) by failing to pay the applicant long service leave at the time of termination
In the statement of claim it was alleged that:
3. The second respondent was:
a.The manager of the first respondent;
b.Responsible for the first respondent's carriage, control and conduct;
c.Responsible for the supervision and management of the applicant: and
d.Involved in terminating the applicant's employment.
The statement of claim then pleads the contraventions the applicant alleges against the first respondent and continues:
35.Prior to the contraventions, the second respondent had knowledge that:
a.The applicant was not paid $1000 per week from
3 January 2013 to 31 March 2014;
b.The applicant was entitled to accrue annual leave;
c.That unused annual leave accrues from year to year;
d.Applicant had accrued annual leave owing to him at the time of termination;
e.The first respondent did not make superannuation contributions to the applicant's account;
f.The applicant was not paid payment in lieu of termination:
g.The applicant was not provided with written notice of termination;
h.The applicant did not receive pay slips;
i.Applicant had long service leave owing to him at the time of termination.
36.The second respondent is liable for the non-payment of long service leave pursuant to sections 10A and 10B of the LSL Act.
The application sought declarations that the second respondent had personally contravened the provisions identified and the statement of claim did not clearly allege anything different. However, the applicant was employed by the first respondent, not the second respondent, and it has not been shown how the second respondent could be liable in his own right for the first respondent’s contraventions, a matter discussed further shortly. As to the applicant’s allegations more generally, he did not show how provisions of the FW Act which address the conduct of employers, such as s.44 and s.340 read with item 1 of s.342(1), which are summarised or quoted earlier in these reasons, applied to the second respondent.
Importantly, although the statement of claim hinted in its para.3, quoted above, that the second respondent had been an accessory to the first respondent’s contraventions, it did not actually allege that. Relevantly, no reference was made to, or reliance placed on, s.550 of the FW Act, which was quoted earlier in these reasons. In the context of s.550’s predecessor in the Workplace Relations Act 1996, I said in Fair Work Ombudsman v Centennial Financial Services Pty Ltd & Ors (2010) 245 FLR 242 at 280-281 [151], in comments which Collier J approved in Whelan v Cigarette & Gift Warehouse Pty Ltd (2017) 275 IR 285 at 327 [139], [141] :
Involvement in a contravention under s.728 can only be made out if it is proved that a person has engaged in conduct specified in s.728(2). Thus, to make out involvement it is necessary to allege that a person has engaged in such conduct. In the present proceedings, the further amended statement of claim made no reference to conduct specified in s.728(2). It is also necessary to particularise which acts or set of acts constituted conduct amounting to involvement but the further amended statement of claim did not do this. Further, to form the requisite intent the respondent must have had knowledge of the essential matters which have gone to make up the contravention in question: Yorke v Lucas (1985) 158 CLR 661. Consequently, an allegation of accessorial liability requires a pleading that the accessory had actual knowledge of each and every element of the principal’s contravening conduct and [made] an election to engage in the relevant conduct; the pleading must assert as material facts that the accessory was sufficiently aware of all the relevant facts going to the contravention: Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union (AMWU) v John Holland Pty Ltd (2009) 180 IR 350 at 359-360 [44], [45]. The further amended statement of claim did not make such allegations.
In this case, it was not alleged that the second respondent:
(a) … aided, abetted, counselled or procured the contravention; or
(b) … induced the contravention, whether by threats or promises or otherwise; or
(c) [had] been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to the contravention; or
(d) … conspired with others to effect the contravention.
For instance, it was not alleged that the second respondent was knowingly concerned in the first respondent’s failure to pay out the applicant’s accrued annual leave entitlement, its failure to make superannuation contributions for him or its failure to provide him with pay slips. All that is relevantly alleged against him is that he knew of certain conduct but, as already noted, that is insufficient to prove liability as an accessory under the FW Act.
For those reasons I do not find that the second respondent contravened the FW Act as contended by the applicant.
Alleged offences against the Long Service Leave Act
For present purposes the relevant criteria for liability under ss.10A or 10B of the LSL Act are that a person is a director of the relevant company or:
… an individual who is involved in the management of the corporation and who is in a position to influence the conduct of the corporation in relation to the commission of the … offence …
The only evidence of who has been a director of the first respondent is a company search annexed to Mrs Cromb’s affidavit of 20 October 2017 that refers only to her and does not suggest that anyone else had ever been a director of that company. The applicant has not adduced any evidence to the contrary. As to the other criterion, the evidence does not persuade me that the second respondent had any responsibility for, or involvement in, the management of the company, as distinct from the operation of the MX Track. The conclusion I have reached is that although the second respondent had certain informal management responsibilities in relation to activities at the MX Track, he had no role in the administration of the first respondent and, relevantly, in decisions concerning employment or the payroll.
For those reasons I find that the second respondent did not commit offences against ss.10A or 10B of the LSL Act because he had not been a director of the first respondent or:
… an individual who is involved in the management of the corporation and who is in a position to influence the conduct of the corporation in relation to the commission of the … offence …
CONCLUSION
For the reasons I have given, the application will be dismissed.
I certify that the preceding one hundred and fifty-five (155) paragraphs are a true copy of the reasons for judgment of Judge Cameron
Associate:
Date: 20 December 2019
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