D'Ortenzio, Angela Gabrielle v Telstra
[1997] FCA 1422
•11 DECEMBER 1997
FEDERAL COURT OF AUSTRALIA
Industrial Law - termination of employment - fixed term contract - extensions to the term of the contract - claim that termination was without a valid reason contrary to Division 3, Part VIA of the Workplace Relations Act 1996 - whether termination at the end of the fixed term at the initiative of the employer - whether the employee was engaged for a specific task - whether a main purpose of the employee’s engagement under a fixed term contract was to avoid the employer’s obligations under Division 3.
Workplace Relations and Other Legislation Act (1961) (Cth) s 16
Workplace Relations Act 1991, ss 170CC, 170EA, 170ED, 170DE
Workplace Relations Regulations 30B
Fisher v Edith Cowan University (1997) 72 IR 464 applied
Matter No. SA96/1176R of 1997
ANGELA GABRIELLE D’ORTENZIO v TELSTRA
VON DOUSSA J
ADELAIDE
11 DECEMBER 1997
IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY
SA96/1176R of 1997
BETWEEN:
ANGELA GABRIELLE D'ORTENZIO
APPLICANTAND:
TELSTRA
RESPONDENTJUDGE:
VON DOUSSA J
DATE OF ORDER:
11 DECEMBER 1997
WHERE MADE:
ADELAIDE
THE COURT ORDERS THAT:
The orders of the Judicial Registrar made on 7 May 1997 be set aside.
The application by Angela Gabrielle D’Ortenzio be dismissed.
IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY
SA96/1176R of 1997
BETWEEN:
ANGELA GABRIELLE D'ORTENZIO
APPLICANTAND:
TELSTRA
RESPONDENT
JUDGE:
VON DOUSSA J
DATE:
11 DECEMBER 1997
PLACE:
ADELAIDE
REASONS FOR JUDGMENT
By notice of motion filed on 28 May 1997 the respondent in these proceedings, Telstra Corporation Limited (“Telstra”) seeks review under s 377 of the Workplace Relations Act 1996 (“the Act”) of a decision of a Judicial Registrar delivered on 7 May 1997. The jurisdiction of this Court to conduct the review arises by operation of Schedule 16 of the Workplace Relations and Other Legislation Amendment Act 1996 (Cth).
The proceedings were commenced by application filed in the Australian Industrial Relations Commission under s 170EA(1) of the Act by Angela D’Ortenzio (“the applicant”). The applicant alleged that her employment had been terminated unlawfully by Telstra on 1 November 1996. The proceedings were referred to the Court pursuant to s 170ED(1).
The evidence at trial
The primary facts adduced into evidence before the Judicial Registrar were, for the most part, common ground. Indeed, a statement of agreed facts was filed which largely covers the circumstances and terms of the applicant’s employment. The applicant commenced employment with Telstra in the “pay by phone” section on 13 May 1993. That section of Telstra’s operations concerned the processing of telephone transactions by customers wishing to pay telephone accounts by credit card. The engagement of the applicant was outlined in a letter dated 14 May 1993. The letter read:
“Dear Angela
ADVICE OF PERIOD OF FIXED TERM EMPLOYMENT
I am pleased to offer you a period of fixed term employment, the reason for which is to provide relief in the Pay-by-Phone area, as an Admin Officer 1 from 13/05/93 to 16/06/93 on a salary of $19663 p.a. (+15% loading) on an ad hoc basis. This period of employment is subject to your conduct, diligence and efficiency being satisfactory.
Please note that as your employment is for a fixed term, you are not eligible for redundancy benefits, and this period of employment is not to be interpreted as an expectation of longer term employment.
Yours sincerely
...”
When the offer of fixed term employment was made, the applicant understood that her employment was to be part time, and would be treated and paid as, casual employment. The applicant was informed that she would be rostered for employment for up to about 22 hours per week. In the years that followed her hours fluctuated, but were around that figure.
Apart from a period from 16 June 1995 to 31 July 1995 when the applicant, at her request, was not employed, she was continuously employed in the “pay-by-phone” section from 15 May 1993 up to and including 12 January 1996 under a series of contracts, each stated to be for fixed term employment of three months, on terms substantially similar to those set out in the above letter. In particular each letter of engagement, which the applicant acknowledged by signing her acceptance, contained the statement that the employment was for a fixed term, and that the period of employment was not to be interpreted as an expectation of longer term employment.
The letters containing offers of employment in respect of the periods commencing on 17 September 1994 and 18 December 1995 were not delivered to the applicant until one or two days after the commencement of the period of employment, and on every occasion the letter was not signed by her until after the period of employment had commenced.
In about December 1995 the applicant became aware that Telstra was seeking to engage administrative officers in its “winback” program in the Service Provider Service Centre. Employment positions in the winback program were to be full time positions, although again on fixed term contracts.
At trial there was no dispute between the parties as to the nature of the winback program. The function of the program was to process applications received from customers who had at an earlier date transferred to other service providers, and now wished to transfer back to Telstra. It was necessary for Telstra to reintegrate those customers back into its own direct customer system. By the end of 1995 Telstra had a nationwide backlog of applications from about 30,000 customers. Telstra had plans on foot to introduce a computerised service to assist in processing applications of this kind, but management considered it necessary to make a short term concentrated effort to process the backlog so that its permanent employees, aided by the automated system, could thereafter process in a timely manner future applications as they were received. To this end Telstra decided to engage the services of about 60 fixed term employees for approximately three months to process the backlog. At that stage Telstra had 22 permanent staff working in the winback program, and over the succeeding few months the number of permanent staff members was increased to 40.
The applicant applied for a winback position. She was anxious to obtain both full time employment and a permanent appointment. Her application was successful.
At the initial interview before she was offered the position, or at least before she commenced in the position, it was explained to her, and she understood, that the full time position on offer involved employment for a specific project that was intended to be short term. She agreed in cross-examination that she had been informed that “it was a specific project to get rid of a short term backlog and to cover the system, the winback system, prior to the installation of a computer system”. She accepted the position even though Telstra said it was only a three month position as she felt that it would improve her chances of eventually gaining a permanent appointment.
The winback position again involved employment under a fixed term contract evidenced by the terms of a letter which was provided to the applicant on 15 January 1996, the day she commenced in the new position. At that time there was still current a fixed term contract for part time employment in the pay-by-phone section. On 22 December 1995 the applicant had confirmed in writing her acceptance of an offer for fixed term employment from 18 December 1995 to 15 March 1996 in the pay-by-phone section. Upon her transfer, that employment was relinquished in favour of employment in the new position. The pay-by-phone section and the winback section of Telstra are quite separate administrative sections. The supervising personnel are different. The personnel in the pay-by-phone section informed the applicant when she relinquished her employment there that her position in the pay-by-phone section would remain open to her for three months so that she could return to it if employment in the winback program came to an end within that time. The letter of 15 January 1996 offered full time employment in the winback program from 15 January 1996 to 12 April 1996. In evidence the applicant said she was hopeful that the full time job would last for a longer period. She knew that the position in the pay-by-phone area would remain open only for three months and that thereafter she knew that the position would not be available to her. She observed “you had to take chances”.
Evidence was given at trial by Mr De Garis who at the time was the manager of the winback section with Telstra, as to the reasons for the engagement of fixed term employees in the winback program and about the expectations of Telstra as to the duration of that exercise. There is no reason to doubt the evidence given by Mr De Garis. It is not inconsistent with the applicant’s understanding of the situation, and it accords with information that Telstra was at the time supplying to the relevant union, the Community and Public Sector Union, SA Branch, Adelaide (“the CPSU”).
Initially it was anticipated that the exercise could be accomplished within three months, probably by the end of March 1996. The initial fixed term contracts were granted to 12 April 1996 to allow a margin. When the exercise was planned, Telstra was receiving winback applications at the rate of about 1,500 per week. However, once the backlog was diminished and applications were being processed more speedily, the rate of customers seeking to transfer back to Telstra from other service providers increased to 4,500 a week, and it was necessary to extend the exercise. Shortly before 12 April 1996 the Group Managing Director approved an extension of the engagement of fixed term employees, and those then on fixed term contracts were informed that their contracts would be extended to 31 July 1996. Written letters to this effect were provided, the applicant receiving a letter dated 24 April 1996 offering her extended employment. She accepted the offer under the conditions stated in the letter by endorsing the foot of the letter on 21 May 1996.
Mr De Garis said that when the decision was made to extend the contracts to 31 July 1996 it was anticipated that the computer based automatic system for processing winback applications would be installed by then, and that the processing work after 31 July 1996 could be handled either by the permanent staff or by the “automatic robots”. However as 31 July 1996 approached, it was apparent that there would be significant delays in the delivery of the automatic processing equipment, and that it would be necessary to extend again the employment of the fixed term employees. The winback section applied to the Group Managing Director for approval for this to happen. Approval was given, but with a direction that the employees should be engaged through a personnel agency, and not by direct contract. This happened in the case of almost all the fixed term employees save for the applicant. The applicant was granted a further fixed term contract from 1 August to 27 September 1996. Once again, when that date approached, it was clear that there would be further delays before the automated equipment was installed, and Telstra offered extensions of the fixed term contracts from 28 September 1996 to 1 November 1996.
As the expiry date of the period of employment extended to 27 September 1996 approached, the employees subject to the contracts were informed as to the reasons for Telstra’s desire to further extend their contracts, and were told in clear terms that contracts would not be extended beyond 1 November 1996.
When offers were made to the fixed term employees of further periods of employment, most but not all the employees accepted the offers. The applicant was one of those who continued working until 1 November 1996.
1 November 1996 was the last day upon which the fixed term contract employees worked. The applicant has not worked since that day.
By 1 November 1996 the computerised equipment had been installed and Telstra hoped that it would work adequately. Apparently that did not occur, and within a few days after 1 November 1996 the sales section of Telstra dealing with business and government customers insisted that the applications be again processed manually, at least for a month or two. That led to the re-engagement of some 40 of the 56 fixed term employees who had ceased work on 1 November 1996, but the applicant was not one of those re-engaged.
I return to the letters which offered the applicant fixed term employment in the winback program. These letters covered many aspects of the employment offered, but it is sufficient for present purposes to refer to parts only of the letters. The letter of 15 January 1996 said, relevantly:
“I am pleased to offer you fixed term employment with Telstra in the Service Provider Service Centre as an Administrative Officer Grade 1, for a period of 3 months from Monday 15 January 1996 until Friday 12 April 1996 inclusive, commencing at 15 Ayliffes Rd St Mary’s.
...
Your period of employment may be extended depending on the business requirements of Telstra.
...
Could you please indicate your acceptance of this offer of fixed term of employment by signing the attachment and returning it to me today to enable personnel records to be correctly processed.
...”
The attachment to the letter, which the applicant signed on 15 January 1996 was an acknowledgment of the terms and conditions set out in the letter.
The next period of employment, from 13 April 1996 to 31 July 1996 was subject to an offer contained in a letter dated 24 April 1996 to the applicant. In relevant respects this letter read:
“I am pleased to offer you an extension of your Fixed Term employment as an Administrative Officer Grade 1 to undertake the task of processing applications for winback from Service Provider customers. The task is expected to be completed by 31 July 1996 and therefore the period of this contract extension is Saturday 13 April 1996 to Wednesday 31 July 1996.
...
Your employment is subject to an understanding:
· that no further period of employment is to be expected.
...
Could you please indicate your acceptance of this employment contract extension by signing the attached copy of this letter and returning it to your immediate manager.”
The letter for the period of employment from 1 August 1996 to 27 September 1996 also offered the applicant “an extension of your Fixed Term employment with Telstra” for that period, and again was said to be subject to an understanding that no further period of employment is to be expected. Unlike the letter of 24 April 1996, the letter of 1 August 1996 did not expressly say that the purpose of the employment was “to undertake the task of processing applications for winback...”. The applicant signed the letter, accepting the offer of employment, on 26 August 1996.
The final period of employment from 28 September 1996 to 1 November 1996 was subject to an offer contained in a letter dated 27 September 1996 to the applicant. Again the letter by its terms offered the applicant “an extension of your Fixed Term employment”, this time for a period of five weeks from 28 September 1996 to 1 November 1996, and without making express reference to the purpose of the employment. It seems that this letter was not delivered to the applicant until some time after 28 September 1996. On 23 October 1996 she signed the foot of the letter where directed under the notation “I accept the offer of employment under the conditions stated” and returned it to Mr De Garis. However, the applicant had first altered the terms of the offer by deleting the stipulated five week period and substituted in her own hand “12 months from 28 September 1996 to - November 1997 with right to renew”.
After Mr De Garis had read the altered text, he informed the applicant that her contract would come to an end on 1 November 1996 at the expiry of the period of fixed term employment that had been offered.
In 1993 Telstra had entered into a number of enterprise agreements covering different sections of its operation with the CPSU. Relevant to the winback program was the Commercial and Consumer Agreement 1993. The applicant was a member of the CPSU, and consulted an official of that Union regarding her desire to obtain permanent employment with Telstra on many occasions during 1996.
The Commercial and Consumer Agreement 1993 recited that the parties to the agreement (the Commercial Business Unit and the Consumer Business Unit of Telstra, and the CPSU) recognised “pressures driving Commercial and Consumer to achieve greater flexibility and are committed to the establishment of ‘Offices of the Future’ in which Commercial and Consumer, following agreement with the Union, may trial and evaluate new processes, practices, procedures, systems and structures (excluding award matters) in a controlled environment”. The agreement made provision for the scheduling of extended working hours for staff and for part time employment, although “C & C agree[d] to maintain permanent full time employment as the primary form of employment within the Business Unit”. The agreement also made provision for fixed term employment. Clause 5 thereof relevantly provided that:
“5. FIXED TERM EMPLOYMENT
The parties agree that fixed term staff may be employed from time to time for specific and identified short term needs such as:
· extended leave
· a specific one off project
· work peaks related to specific events eg preselection
Where the need is known to be ongoing in excess of 12 months the parties agree that the positions will be filled on an ongoing basis.
There shall be specific written notification to the PSU a minimum of two weeks prior to engagement of fixed term staff, covering the following:
· number
· location
· purpose
· duration
· other relevant matters
This shall be done on a Regional basis and forwarded to the relevant Branch of the PSU. Consultation will occur where requested by PSU.
The maximum period for fixed term employment will be 12 months. Any current fixed term employees in excess of 12 months will be engaged on an ongoing basis.”
Before the engagement of employees on fixed term contracts for the winback program, Telstra advised the CPSU of its proposal and that it considered the project to be a specific one which would not exceed three months. As events turned out, it ran for longer, but before each of the contract extensions accrued, the CPSU was advised. Moreover, after Mr De Garis received the instruction that employees were to be engaged after 31 July 1996 through a personnel agency, and before the offers were made to employees for the period commencing 1 August 1996, he contacted the CPSU and informed the relevant Union official of that fact. On 20 August 1996 the CPSU wrote to Mr De Garis raising a number of concerns of members in “temporary employment” in the winback program. As a general observation, the letter said:
“The CPSU would always prefer permanent employment however we understand that in some circumstances temporary employment is appropriate. The SA Branch of the CPSU would also prefer that contracts are made between Telstra and the employee directly rather than going through Personnel Agencies. Notwithstanding that view, because of the very short time frame we are considering here we are prepared to agree to the extension of the current employment contracts through the agency. If Telstra seeks to continue to extend the contracts beyond October I will be seeking to discuss future employment arrangements with you.”
The letter addressed issues raised by members concerning the proposed “agency contract” and then continued:
“In the event that any permanent appointment is possible there will be no disadvantage to any of our members by the changed contract arrangements. Because of a direct concern of one member in particular and her exceptional circumstances I am seeking that Telstra allows Angela Dortenzio (sic) a separate work contract with Telstra on the same basis that she has been employed with the Service Provider Service Centre over the past few months. As you are aware the CPSU is supporting Ms Dortenzio in her attempt to gain permanent appointment and we do not wish this situation to complicate her endeavours.”
On 21 August 1996 Mr De Garis replied to the CPSU letter, agreeing to a number of matters raised by the Union and saying that the applicant would be issued with a Telstra fixed term contract for the period 1 August 1996 to 27 September 1996.
There was further correspondence between the CPSU and Telstra when it became clear that the use of fixed term employees in the winback program could not be completed by 27 September 1996. On 20 September 1996 the CPSU wrote saying:
“Further to our discussion yesterday and phone call today I am writing to formalise the arrangements agreed. The CPSU agrees to extending the contracts in the Service Provider Service Centre to November 1 1996 on the same basis as they exist at the moment.
Our agreement to any further extensions will be made on the basis that Telstra will convert those members from agency contracts who wish to return to Telstra Contracts. The CPSU will also be seeking to have permanent jobs created if Telstra seeks to extend the temporary contracts beyond 12 months. Of course we will be seeking to protect members from being dismissed prior to their 12 months ongoing employment if their (sic) is still any requirement for continued contract work in the Service Provider Centre.”
Mr De Garis replied by letter dated 2 October 1996. He said, among other topics, that the applicant would be issued with a Telstra fixed term contract for the period 30 September 1996 to 1 November 1996.
On 30 October 1996 the CPSU again wrote to Mr De Garis saying:
“I am writing to you on behalf of our member Ms Angela Dortenzio. As you are aware her contract of employment expires on Friday November 1 1996. Ms Dortenzio has been employed with Telstra as a casual or temporary staff member for a number of years in the Pay by Phones area and more recently in the Service Provider Centre.
The CPSU is seeking to secure permanent employment for Ms Dortenzio as we have previously discussed. I am formally requesting you to continue the employment of Ms Dortenzio in the Service Provider Centre. ...”.
That request was not met. Mr De Garis wrote on 31 October 1996 saying:
“In response to your letter of 30 October 1996, Ms D’Ortenzio was specifically employed, along with 55 other staff, to eliminate the national backlog of applications from Service Providers’ customers wishing to return to a full retail relationship with Telstra.
The portion of the backlog that has to be manually processed has now been eliminated and therefore the contracts of all fixed-term staff in our centre, including Ms D’Ortenzio, will not be extended past their current expiry date of 1 November 1996. ...”.
The decision of the Judicial Registrar
The respondent argued at trial that the relevant provisions of Part VIA of the Act did not apply to the applicant by virtue of s 170CC and regulation 30B of the Workplace Relations Regulations made pursuant to that section. In particular counsel for Telstra relied on regulation 30B(1)(aa) and (b) which relevantly provide:
“30B(1) Subject to subregulation (2), for the purposes of section 170CC of the Act, the following employees are excluded from the operation of Subdivisions B, C, D and E of Division 3 of Part VIA of the Act:
(a)...
(aa)an employee engaged under a contract of employment for a specified period of time, being a contract that was entered into on or after 16 November 1994, if the specified period is less than 6 months;
(b)an employee engaged under a contract of employment for a specified task;
(c)...
(d)...
30B(2)Subregulation (1) does not apply to an employee engaged:
(a)under a contract of a kind referred to in paragraph (1)(a) or (aa); or
(b)under a contract of a kind referred to in paragraph (1)(b) (being a contract that was entered into on or after 16 November 1994);
if a main purpose of the engagement under a contract of that kind is, or was at the time of the employee’s engagement, to avoid the employer’s obligations under Subdivision B, C, D or E of Division 3 of Part VIA of the Act.”
The Judicial Registrar, after referring to the decision of the Full Court of this Court in Fisher v Edith Cowan University (1997) 72 IR 464, expressed her conclusion as follows:
“In this matter the Applicant continued to work after the expiration of each of the contracts on 12 April 1996, 31 July 1996 and 27 September 1996. The written offer of an extension of the previous contract was made on each occasion after the expiration of the previous contract. In relation to the offer dated 27 September 1996, the Applicant did not accept that contract at any time.
In my view it is clear that the Applicant was in continuous employment at the time her employment was terminated.”
The Judicial Registrar considered there was no valid reason for the termination of the applicant within the meaning of s 170DE of the Act, and observed that Telstra had acted as it did on the assumption that the applicant’s employment could be brought to an end without regard to the provisions of the Act on 1 November 1996. By way of remedy, an order was made that the applicant be reinstated on terms and conditions no less favourable than those on which she was employed immediately before the termination of her employment, and that Telstra pay to the applicant remuneration lost because of the termination of her employment from 1 November 1996 until the date her employment is reinstated (excluding a short period nominated in the order during which there had been a delay in the trial caused by the applicant). The order further provided that for the purposes of calculating the applicant’s leave entitlement she was to be regarded as continuously employed from 1 November 1996 until the date of her reinstatement. In respect of the order for reinstatement the Judicial Registrar said that she was satisfied on the evidence before her that there is work available to the applicant either in the winback program or elsewhere in Telstra, and that there was no evidence of substance as to why the applicant could not return to work for Telstra.
Evidence on the review
The transcript of the proceedings before the Judicial Registrar and the exhibits tendered during the trial were received into evidence on the review by consent. In addition, affidavits were filed from a number of people, including the applicant, to supplement the trial evidence on the question of whether it was practicable for Telstra to reinstate the applicant. However, when argument got under way on the review, this question became a subsidiary issue. Although counsel for Telstra had intimated an intention to call oral evidence on this topic, oral evidence was not led, nor did counsel for the applicant cross-examine any of the deponents of affidavits filed by Telstra.
Arguments on the review
The issues canvassed at length on the review concerned the operation of regulation 30B, and whether the Act had application to the applicant in respect of the termination of her employment on 1 November 1996.
Telstra sought to have the findings of the Judicial Registrar set aside and the applicant’s application dismissed. Counsel for Telstra argued that on the evidence the employment was not continuous or for an indefinite period. The period of employment in the pay-by-phone section, being casual ad hoc employment, was to be distinguished from the period of employment in winback. The employment in the pay-by-phone section was consensually terminated on 12 January 1996. Thereafter, so it was argued, the applicant worked under a series of consecutive stand alone fixed term contracts of employment. As the applicant’s employment contract expired on 1 November 1996, there was no termination at the initiative of the employer. Further, regulation 30B(1)(aa) applied as the relevant fixed term contract operated from 28 September 1996 to 1 November 1996, being a period of less than six months. In the further alternative the applicant was excluded from the operation of the relevant provisions of the Act by regulation 30B(1)(b) in that her engagement in the winback program was for a specified task namely for the processing of the backlog of winback applications pending the instalation of the automated system. In the event that these arguments failed, and the Court held that the provisions of the Act applied to the termination of her employment on 1 November 1996, it was not disputed that Telstra would be in breach of s 170DE(1) of the Act. It was contended however that it was not appropriate in all the circumstances that reinstatement be ordered.
Counsel for the applicant sought to uphold the orders of the Judicial Registrar. Counsel contended that the evidence established that the applicant worked under a continuous contract of employment which ran, effectively, from the applicant’s commencement in the pay-by-phone section. It was argued that the Court should infer that the practice of signing contracts was merely one of administrative convenience, and the fact that they were signed by the applicant after the commencement date supported the conclusion that the contracts were to avoid the respondent’s obligations under the Act: reg 30B(2). The fact that the pay-by-phone section continued, as did work in the winback program, should lead the Court to infer that the applicant was not engaged on temporary work. In the alternative, it was contended that reg 30B(1)(aa) could not apply as for the period 15 January 1996 until 1 November 1996 the applicant worked under one contract, extended from time to time, so that the total period exceeded the six month limitation referred to in paragraph (aa) of the regulation. Further, it was submitted that the applicant was not engaged under a contract for a specific task so as to come within the exclusion in reg 30B(1)(b). It was argued that no specific task was identified in the extension to the contract dated 27 September 1996 and that during the course of the applicant’s work in the winback section her tasks changed from data processing to dealing with customer enquiries by telephone.
Conclusions
In my opinion the applicant did not work under one continuous contract of employment from the commencement of her work in the pay-by-phone section through to 1 November 1996. I consider that her period of employment from 15 January 1996 through to 1 November 1996 was pursuant to a different contract or contracts of employment from the contract or contracts of employment that operated during the period of employment from 13 May 1993 until 12 January 1996.
In my opinion the evidence establishes, and I so find, that on 12 January 1996 the contract of employment which governed the applicant’s employment in the pay-by-phone section was terminated by mutual agreement, and that the applicant commenced employment pursuant to a new contract of employment in the winback area on 15 January 1996.
Whether a change in the duties and conditions of employment constitutes a variation of the existing contract of employment, or a new contract of employment is a question of fact: Quinn v Jack Chia (Australia) Ltd [1992] 1 VR 567. Where the change in duties, and in other conditions is substantial, the Court will be more ready to hold that a new contract has replaced the old one: see Quinn v Jack Chia (Australia) Ltd at 575 and following, Federated Mutual Insurance Company of Australia Ltd v Sabine (1920) SALR 284 at 292, Meek v Port of London Authority [1918] 2 Ch 96.
The changes which occurred to the applicant’s employment on 15 January 1996 were extensive. There was a major change in duties, and the employment altered from part time ad hoc employment to full time employment. The rate of remuneration changed as did the entitlement to holidays and other benefits attaching only to full time employment.
In the present case the change from one contract situation to another was deliberately made by the applicant as she considered it would improve her chances of obtaining permanent employment with Telstra. The applicant was fully aware at the time that the full time employment in the winback program was short term temporary employment, but she elected to take a chance as she believed her prospects of obtaining a permanent appointment would in the long run be improved by the change.
The new contractual terms which governed the employment of the applicant from 15 January 1996 were set out in the letter of 15 January 1996. The employment was for a fixed term, but the contract contemplated that the period of employment “may be extended”. The letters of 24 April 1996, 1 August 1996 and 27 September 1996 are each expressed to be offers of “an extension to your Fixed Term employment”. Although the written offers were made and accepted after the commencement of the periods of extension, the applicant had been informed that the offers would be made before the previous period expired. In my opinion by continuing to work after the expiry of the earlier nominated period the applicant by her conduct accepted the offer of an extension of fixed term employment.
In my opinion the applicant accepted an oral offer to extend her contract of employment from 28 September 1996 to 1 November 1996 by continuing to work in her job on and after 28 September 1996. The offer of that extension had been accepted before she received Telstra’s letter dated 27 September 1996, which confirmed in writing the offer earlier made to her orally. The applicant’s amendment to the text of the letter before she returned it to Mr De Garis had no legal effect as the variation sought to be achieved by the amendment was never accepted by Telstra.
In Brooke v Clark (1818) 1 B Ald 396 at 403 Lord Ellenborough CJ accepted the proposition that had been put in argument that “extension” is a term properly used for the purpose of enlarging, or giving further duration to, an existing right but observed that the expression does not import the revesting of an expired right; that would not be an “extension”, but a “recreation”. In the present case, as the offers of extended employment were in each instance made before the preceding period had expired no question of “recreation” arises. In my opinion the contract which commenced on 15 January 1996 was extended for further periods on three occasions. When an extension occurred, the terms and conditions of the employment continued for the new period as extended. In the result, from 15 January 1996 until 1 November 1996 I consider the applicant worked under one contract of employment in the winback section. That period exceeded six months, and accordingly reg 30B(1)(aa) has no application.
Although the contract was on three occasions extended, on each occasion the effect of the extension was to extend the term of the employment to a new fixed date. As extended, on each occasion the contract continued to be a fixed term contract.
I consider that the evidence clearly establishes that the applicant and the other fixed term employees working in the winback section were truly engaged as temporary employees to fulfil a task understood by both Telstra and the employees at the time to be one of limited duration. At the expiration of the fixed term, as extended to 1 November 1996, the employment came to an end because the term expired. The provisions of Division 3 of Part VI of the Act apply to an applicant where the applicant’s employment has been terminated at the initiative of the employer: Mohazab v Dick Smith Electronics Pty Ltd (No.2) (1995) 62 IR 200 at 203 and following. In State of Victoria v Commonwealth of Australia (1996) 138 ALR 129 at 173 Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ said that the words “[a]n employer must not terminate an employee’s employment” used in s 170DE(1) of the Act do not apply to a situation where the employment comes to an end because its term has expired.
Where the employment comes to an end because the term has expired, there has not been a termination of employment at the initiative of the employer: Fisher v Edith Cowan University (supra). That is the position in this case.
In Fisher v Edith Cowan University, the Full Court recognised that there might be cases where there was a termination at the initiative of the employer even though whilst on the face of the relevant contract of employment, it appeared to be one for a specified period of time providing for consensual termination of the employment relationship by the effluxion of the period specified. The Court said at 469-470:
“For example, if an employer arranges for an employee to render service under consecutive contracts of employment for specified periods of short duration, where the nature of the employment is appropriate for a contract of indeterminate duration, and the employee had no say in the terms of the agreement, it may be said that the contract served the purpose of the employer by providing additional control over the employee. In such circumstances if the employment relationship is terminated by the refusal of the employer to ‘roll over’ the employment contract, the termination may be seen as part and parcel of an initiative taken by the employer at the commencement of the contract of employment to reserve that power.”
In my opinion the present case is not one within the example postulated by the Full Court. Here the employment was appropriate for a contract of limited and fixed duration when it was made. Events did not turn out as Telstra at first anticipated, and it was necessary to extend the contract from time to time, but when the fixed period came to an end, it did so because at that time the employer believed that the reason for the engagement of the applicant, and the other fixed term employees, had come to an end.
As following events turned out, a number of the fixed term employees were re-engaged. However, there is nothing on the evidence to support a finding that Telstra did not genuinely believe that during September and October 1996 that the need to engage fixed term employees would have come to an end by 1 November 1996.
As I hold that there was no termination of the applicant’s employment at the initiative of the employer the provisions of Division 3 of Part VIA of the Act have no application. On this ground the applicant’s claim fails, and the application should be dismissed.
The conclusions of the Judicial Registrar did not expressly address the alternative argument raised by Telstra that the applicant was engaged under a contract of employment for a specified task and therefore excluded from the operation of the relevant provisions of the Act by reg 30B(1)(b). By implication however the finding of the Judicial Registrar that the applicant was in continuous employment probably leads to a conclusion that the contract of employment was not for a specified task.
In my opinion the evidence supports a finding that the contract of employment entered into on 15 January 1996 and extended from time to time to 1 November 1996 was a contract for a specified task, and I so hold.
When the applicant was interviewed for a position in the winback section the reason for that employment was explained. In my opinion the requirement for a number of employees to remove the backlog of applications over a period that was anticipated to be short, and until the introduction of the automated process, was a specified task. That specified task was not expressly identified in the letter of 15 January 1996. However it was expressly referred to in the first extension letter. The subsequent extensions, though not again referring expressly to the task, merely enlarged the term of the single contract. I do not consider the fact that there was a change in the specific duties performed by the applicant part way through the period from data processing to dealing with telephone enquiries (a task which also included a component of data processing) alters this position. The data processing and the telephone enquiries were part and parcel of the task of manually processing the winback applications. The contract of employment came to an end at a time when it was anticipated that the specified task had come to an end.
In my opinion the evidence does not establish that the engagement of the applicant under a fixed term contract in the winback section had a main purpose to avoid Telstra’s obligations under Division 3 of Part VI of the Act. The purpose of the engagement was explained both to the applicant and to the CPSU, and there is no reason to doubt that the explanation given was the correct explanation.
In my opinion reg 30B(1)(b) also applied to the applicant, and on this additional ground her claim should be dismissed.
After the application for review was filed by Telstra on 28 May 1997, an application was made to stay the orders of the Judicial Registrar. On 30 May 1997 an order was made staying the payment of remuneration from 1 November 1996 to 30 May 1997, but the Court refused a stay in respect of the reinstatement order. Information before the Court indicates that, although the applicant was thereafter paid her normal remuneration she did not in fact return to active duties. There may be a need for consequential orders to determine the rights of the parties upon the dismissal of the applicant’s application. I will therefore hear the parties as to consequential orders that should be made to give effect to the dismissal of the applicant’s application.
I certify that this and the preceding eighteen (18) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice von Doussa
Associate:
Dated:
Counsel for the Applicant: Mr P Hannon Solicitor for the Applicant: Duncan and Hannon Counsel for the Respondent: Mr M Roder Solicitor for the Respondent: Norman Waterhouse Date of Hearing: 15 September 1997 Date of Judgment: 11 December 1997
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