Chung and Secretary, Attorney-General’s Department
[2021] AATA 4804
•23 December 2021
Chung and Secretary, Attorney-General’s Department [2021] AATA 4804 (23 December 2021)
Division:GENERAL DIVISION
File Number: 2020/8419
Re:Thieu Khai Chung
APPLICANT
AndSecretary, Attorney-General’s Department
RESPONDENT
DECISION
Tribunal:Dr Damien Cremean, Senior Member
Date:23 December 2021
Place:Melbourne
The decision under review is set aside and a decision substituted that the Applicant is within the meaning and intent of s 6(5) of the Fair Entitlements Guarantee Act 2012 (Cth) and thus has a redundancy pay entitlement.
I remit the matter otherwise for reconsideration in respect of the amount of such entitlement.
.............[SGD]...........................................................
Dr Damien Cremean, Senior Member
Catchwords
EMPLOYEE ENTITLEMENTS – claim for advance under Fair Entitlements Guarantee Act 2012 (Cth) – Applicant found to be entitled to advance – whether Applicant has redundancy pay entitlement – where employer failed to make payments into fund to provide for redundancy benefits – decision under review set aside – remitted to Respondent to determine amount of redundancy pay entitlement
Legislation
Fair Entitlements Guarantee Act 2012 (Cth)
Fair Work Act 2009 (Cth)
Cases
Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers Union (AMWU) v Berri Pty Limited [2017] FWCFB 3005
Beezley v Repatriation Commission (2015) 68 AAR 23
Carmody and Secretary, Department of Employment [2016] AATA 191
Holbrook and Australian Postal Commission (1983) 5 ALN 35
REASONS FOR DECISION
Dr Damien Cremean, Senior Member
23 December 2021
Introduction
The Applicant, Mr Chung, seeks review of a decision dated 20 February 2019 which set aside a determination dated 20 September 2018.
The determination had found that the Applicant was eligible for an advance under the Fair Entitlements Guarantee Act 2012 (Cth) (“FEG Act”) but included no monies in respect of redundancy pay.
The decision under review (made under s 39(1) of the FEG Act) set aside that determination and substituted a decision that the Applicant was entitled to an additional sum under the Fair Entitlements Guarantee Advance of $8,664.00 in respect of his redundancy.
The Applicant, however, contends he is entitled to an advance of $32,239.19 in respect of his redundancy under or in accordance with the FEG Act.
Hearing
A hearing was conducted in this matter on 11 October 2021.
The Applicant was represented by Mr R Ternes of Counsel instructed by Verduci Lawyers.
The Respondent was represented by Mr I Temby of Clayton Utz solicitors acting as Counsel.
At the hearing, no evidence was called by either party and the case proceeded on the basis that the affidavit evidence of the Applicant constituted the agreed facts without any need for cross-examination.
Each party lodged a Statement of Facts, Issues and Contentions. As well, the Respondent lodged a Statement of Position (to which there are Annexures).
LEGISLATION
Section 16(1) of the FEG Act provides:
If a person is eligible for an advance for the person’s employment by an employer, the amount of the advance is the total of the amount worked out under Division 2 for each of the person’s employment entitlements for the employment.
By s 23 of the FEG Act:
The basic amount for a person’s redundancy pay entitlement for his or her employment by an employer is so much of the entitlement as:
(a)is not a cost of the winding up or bankruptcy of the employer; and
(b)does not exceed the total of:
(i) 4 weeks’ pay (at the rate relevant to working out that entitlement) for each full year of the person’s service with the employer for which the employer was required to pay redundancy pay by the governing instrument for that employment; and
(ii) if that instrument requires payment of redundancy pay for a proportion of a year (less than a full year) of the person’s service with the employer—that proportion of 4 weeks’ pay (at the rate relevant to working out that entitlement).
Note: Sections 25 and 26 may affect the basic amount.
The expression “redundancy pay entitlement” is defined in s 6(5) of the FEG Act as:
The person’s redundancy pay entitlement is the amount of redundancy pay the person is entitled to under the governing instrument from the employer for termination of the employment.
EVIDENCE
As I have noted, the hearing proceeded on the basis of agreed facts set out in the Applicant’s affidavit.
The Applicant swore his Affidavit on 17 December 2020.
In his Affidavit, the Applicant swears that he was born in Vietnam in 1954, lives alone in Australia and is a divorcee with adult children.
He swears he commenced working full time with Steelglo (Aus) Pty Ltd (“Steelglo”) as a first-class sheet metal worker on or about 10 September 2009.
He swears, however, and it is not in dispute that, Steelglo went under administration on 11 May 2018 and that he was terminated without any redundancy payments
He then details the application made on his behalf under the FEG Act by his solicitor and that he was awarded only $8,664.00 as equalling eight weeks’ redundancy pay despite having worked for the employer for almost nine years.
He indicates he has been told and advised that he may be entitled to a further $30,000.00 which he now wishes to seek.
ISSUES AND CONTENTIONS
The Applicant contends that the decision under review should be set aside.
He contends that he is entitled under the FEG Act to a sum of $32,239.19 on the basis that this arises under the governing instrument in question – the Enterprise Agreement (“EBA”) applying to Steelglo and employees, at cls 2.1 and 2.2.
This figure is one provided by Mr Nguyen of the Incolink Trust Fund (“Incolink Fund”) who carried out calculations.
The Applicant submits that, in his case, the EBA is the “governing instrument” within s 6(5) of the FEG Act.
Accordingly, the Applicant submits that a “redundancy pay entitlement” as defined in s 6(5) arises for the purposes of s 23 of the FEG Act.
In this regard, he submits that he has an entitlement under that provision.
In particular, he submits it makes no difference that Steelglo failed to make payments into the Incolink Fund to provide for redundancy benefits (in the event of redundancy) although obliged under the EBA to do so weekly.
The Respondent, however, contends that the decision under review should be affirmed.
The Respondent submits that it is for the very reason mentioned – Steelglo’s failure to make payments into the Incolink Fund – that the Applicant can have no entitlement to redundancy payments in accordance with the EBA.
In other words, the Respondent submits that s 6(5) of the FEG Act can only operate in favour of the Applicant as giving him an entitlement if Steelglo had performed its duty of paying monies into the Incolink Fund.
The stand-out single issue arising then is the effect which should be given to s 6(5) of the FEG Act.
If that is resolved in favour of the Applicant, it is then a matter of deciding whether the amount of $32,239.19 is correct or not.
CONSIDERATION
I am inclined to regard the Respondent’s position as one of studied ambiguity.
At one point, it seemed to me that the Respondent was claiming that the relevant agreement relating to the Applicant was not the EBA but was rather the National Employment Standards in div 11, sub-div B of the Fair Work Act 2009 (Cth).
It seems though that the Respondent now does not challenge the view that the relevant agreement is the EBA.
Nor does it seem there is any live issue for me in regards to whether the EBA covers the Applicant’s employment with “Steelglo (Aus) Pty Ltd”, as opposed to only his employment with “Steelglo Pty Ltd”.
I was taken by the Respondent through various provisions of the EBA – in interesting detail which I do not need to repeat – and to a number of authorities[1] (which I could not see had direct application) but the net result of the Respondent’s submissions appears to be this: the Applicant has not shown how he has any entitlement under the Deed relating to the Incolink Fund in circumstances where Steelglo paid nothing into the Incolink Fund.
[1] Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers Union (AMWU) v Berri Pty Limited [2017] FWCFB 3005; Beezley v Repatriation Commission (2015) 68 AAR 23; Carmody and Secretary, Department of Employment [2016] AATA 191; Holbrook and Australian Postal Commission (1983) 5 ALN 35.
In other words, it is directly in issue whether there can be an entitlement arising under s 6(5) of the FEG Act if there is, in reality, no entitlement to monies in the Incolink Fund for the very reason that no monies at all have been paid into the Incolink Fund.
I do not accept the submissions of the Respondent in this regard.
In my view, an entitlement arises under s 6(5) of the FEG Act irrespective of whether monies have been paid into the relevant Fund.
It is not, in my view, a question of the actual payment of monies into a Fund under the governing instrument but whether – simply – there is an entitlement in a person to have the monies paid into the Fund.
I did not understand the Respondent to dispute that Steelglo should have paid monies into the Incolink Fund but failed to do so.
In those circumstances, there was a duty on Steelglo to pay monies into the Incolink Fund and if so – without going into Hohfeldian analysis – there was therefore a corresponding right in the Applicant to call for Steelglo to do so.
It seems to me to be basic in law that if someone has a duty, someone somewhere else has a right. And it seems to me also to be basic that if someone has a right, then they have an entitlement
If the Applicant had such a right because of such a duty, then it follows in my view therefore that he had an entitlement. In other words, the duty gives rise to a right in the Applicant and a right in him gives rise to him having an entitlement. His entitlement was to have monies in the requisite amount standing to his credit in the Incolink Fund.
But the important point is that the entitlement within s 6(5) of the FEG Act arises because of the duty imposed on Steelglo and does not arise only if Steelglo carries out that duty and pays the monies in.
I therefore find in favour of the Applicant on this short point of interpretation. I consider he is within both the meaning and intent of s 6(5) of the FEG Act.
It is then a matter of deciding whether $32,239.19 is the value of that entitlement, as being the amount which the Applicant would have been entitled to had Steelglo complied with its obligations.
I do not consider I am sufficiently well-placed, on the information given to me, to be able to decide the amount of the sum in question or whether that amount is the correct amount.
CONCLUSION
My reasoning leads inevitably to the conclusion that the decision under review must be set aside.
Accordingly, I do set aside the aspect of the decision under review relating to whether the Applicant satisfies s 6(5) of the FEG Act under the EBA as the governing instrument and I substitute a decision that he does.
As regards that decision, I remit that aspect of the decision concerning the amount of such entitlement for reconsideration.
I certify that the preceding 51 (fifty-one) paragraphs are a true copy of the reasons for the decision herein of
Dr Damien Cremean, Senior Member...........................[SGD]............................................
Associate
Dated: 23 December 2021
Date of hearing: 11 October 2021 Counsel for the Applicant: R Ternes Solicitors for the Applicant: Verduci Lawyers Advocate for the Respondent: I Temby Solicitors for the Respondent: Clayton Utz
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