Donna Bannister v Albany Community Legal Service

[2018] FWC 2867

[2018] FWC 2867

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Donna Bannister
v
Albany Community Legal Service
(U2018/58)

DEPUTY PRESIDENT MASSON MELBOURNE, 4 JUNE 2018

Application for an unfair dismissal remedy – small business employer – minimum employment period.

Introduction

[1] On 2 January 2018, Ms Donna Bannister (the Applicant) lodged an application pursuant to s 394 of the Fair Work Act 2009 (the Act) in which she asserted that the termination of her employment with Albany Community Legal Service (the Respondent) was unfair.

[2] The Applicant was employed by the Respondent from 3 April 2017 until her verbal resignation on 6 December 2017, a period of eight months and three days. The Applicant submitted that she resigned under duress during a meeting with the Respondent. After her resignation, the Applicant sent the Respondent a text message on 6 December 2017 and an email dated 7 December 2018 in which she offered to withdraw her resignation. The Applicant’s offer to withdraw her resignation was not accepted by the Respondent and it confirmed its acceptance of her resignation in a letter to the Applicant dated 7 December 2018 and in a text message to the Applicant attaching the same letter on 11 December 2017.

[3] The Respondent objects to the application on the basis that it was, at the time of the Applicant’s claimed dismissal, a small business employer and that the Applicant had not completed the minimum employment period (12 months) at the time of her dismissal as required under s 383(b) of the Act. Consequently, the Respondent contended the Applicant is not entitled to pursue relief for her claimed unfair dismissal under the Act.

[4] Determination of the Respondent’s jurisdictional objection was set down for a hearing/conference on 25 May 2018.

[5] After taking into account the wishes of the parties as to the way in which the Commission would consider and inform itself in relation to the application, I decided to conduct a conference pursuant to s 398 of the Act to determine the jurisdictional objection raised by the Respondent.

[6] The Applicant appeared at the conference and gave evidence on her own behalf.

[7] Mr Ryan Tozer from Wotton and Kearney law firm sought leave to appear on behalf of the Respondent under s.596(2)(a) of the Act on the grounds that it would enable the matter to be dealt with more efficiently having regard to the complexity of the matter.

[8] After considering the application from Mr Tozer and hearing from the Applicant, the Commission declined to grant permission to appear as the circumstances of the matter were not judged by the Commission to be particularly complex and also having regard to fairness between the parties. Mr Brodie Lewis, the Business Manager for the Respondent, appeared and gave evidence on behalf of the Respondent.

[9] At the conclusion of the conference, the parties were invited to file material and make further submissions on or by 5.00pm on 30 May 2017 in relation to the status of volunteers within the Respondent’s operations. The Respondent filed supplementary materials on 29 May 2017.

Legislative framework

[10] In order to be protected from unfair dismissal, a person must have completed a period of employment with his or her employer of at least the minimum employment period as per s.382(a) of the Act which relevantly states as follows:

“382 When a person is protected from unfair dismiss

A person is protected from unfair dismissal at a time if, at that time:

(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and

….”

[11] The minimum employment period is one year for a small business employer and six months for other employers as provided by s.383 of the Act which states as follows:

“383 Meaning of minimum employment period

The minimum employment period is:

(a) if the employer is not a small business employer—6 months ending at the earlier of the following times:

(i) the time when the person is given notice of the dismissal;

(ii) immediately before the dismissal; or

(b) if the employer is a small business employer—one year ending at that time.”

[12] Section 23 of the Act relevantly defines a small business as follows:

“23 Meaning of small business employer

(1) A national system employer is a small business employer at a particular time if the employer employs fewer than 15 employees at that time.

(2) For the purpose of calculating the number of employees employed by the employer at a particular time:

(a) subject to paragraph (b), all employees employed by the employer at that time are to be counted; and

(b) a casual employee is not to be counted unless, at that time, he or she has been employed by the employer on a regular and systematic basis.

(3) For the purpose of calculating the number of employees employed by the employer at a particular time, associated entities are taken to be one entity.

(4) To avoid doubt, in determining whether a national system employer is a small business employer at a particular time in relation to the dismissal of an employee, or termination of an employee’s employment, the employees that are to be counted include (subject to paragraph (2)(b)):

(a) the employee who is being dismissed or whose employment is being terminated; and

(b) any other employee of the employer who is also being dismissed or whose employment is also being terminated.”

Submissions and evidence

Case for the Applicant

[13] The Applicant asserted that the Respondent employed 17 employees, plus an additional eight board members and was not a “small business employer” within the meaning of s 23(1) of the Act. Therefore, the Applicant contended that as the Respondent was not a small business at the time of her termination, she was protected from unfair dismissal as she had been employed for six months as required under s 383(a) of the Act.

[14] The Applicant submitted that the Respondent engaged a number of volunteers who were regularly and systematically engaged and should therefore be counted as employees in determining whether the Respondent was a “small business employer.” Similarly, the Applicant argued that a number of contractors should also be counted as employees because of the regular and systematic engagement of those contractors that were providing IT, cleaning and internal audit services.

[15] The Applicant did not contest the Respondent’s evidence that there were no associated entities that should be included for the purpose of determining whether the Respondent was a “small business employer.”

Case for the Respondent

[16] The Respondent submitted that it employed 11 staff members, including the Applicant, at the time of her termination and therefore fell within the definition of a “small business employer” for the purposes of s 23 of the Act. The Respondent further submitted that it is an independent, incorporated, not-for-profit community legal centre and submitted that there were no “associated entities” that would increase the number of its employees to 15 or more.

[17] Mr Lewis gave evidence that the Respondent had an independent Board consisting of eight Directors 1 who met approximately six times per annum and were neither engaged as employees on contracts of employment nor were they paid.2

[18] Mr Lewis gave further evidence of the staff engaged at the time of the Applicant’s cessation of employment. The list of staff furnished by the Respondent identified that there were 11 staff members including the Applicant employed as at 6 December 2017 and in support of that list also identified staff resignations in the 18 month period prior to 6 December 2017. 3

[19] Mr Lewis also gave evidence of the contractual arrangements in place with respect to cleaning, independent auditing and IT services, which in the Respondent’s submission, demonstrated the contractor status of those service providers. 4

[20] In a supplementary statement provided to the Commission, Mr Lewis 5 gave evidence as to the volunteer arrangements that were in place at the time of the Applicant’s dismissal. That evidence identified that, at the time of the Applicant’s dismissal, there were three volunteers within the Respondent’s operations. Evidence in relation to each of the volunteers arrangements was provided:

(i) Ms Louise McNamara⁶ – a law student who undertook work experience from

4–15 December 2017.

(ii) Mr Jordan Bova⁷ – undertook volunteer work with the Respondent for approximately six weeks from 1 November 2017.

(iii) Ms Kaye Hansord⁸ – a former employee of the Respondent whose employment ceased in June 2016 and who has since volunteered in her capacity as a Justice of the Peace for three hours per week.

[21] Mr Lewis also gave evidence that the Respondent is an “independent, incorporated not-for-profit community legal centre in Albany” 9and that there were no associated entities.A copy of the Respondent’s Western Australian Incorporated Association Extract was provided.10

Consideration

[22] I am satisfied, and it was not contested, that the Applicant was employed by the Respondent for approximately eight months, from 3 April 2017 until 6 December 2017. Consequently, it follows that if the Respondent was a “small business employer” at the time of the Applicant’s claimed dismissal then she is not protected from unfair dismissal because she had not completed at least the minimum employment period of twelve months at the time of her dismissal.

[23] I am also satisfied, and it was not contested, that the there are no associated entities of the Respondent within the meaning of s 50AAA of the Corporations Act 2001 (Cth). Therefore, it will only be those employees engaged by the Respondent that are relevant for the purpose of calculating the number of employees.

[24] I am satisfied that Board members are not to be included for the purpose of calculating the number of employees of the Respondent. They are neither paid nor engaged as employees by way of contracts of employment and there was no evidence adduced that the directors undertook duties within the Respondent’s business beyond those of a bona fide director. Nor, based on the evidence, are the contractors that are periodically engaged by the Respondent to provide independent auditing, cleaning and IT services to be regarded as employees. I am consequently satisfied on the evidence that at the time of the Applicant’s dismissal the Respondent engaged 11 employees under contracts of employment.

[25] As to the Applicant’s submission that volunteers should be counted as employees, I am not persuaded of the merit of that submission in the present circumstances of the Respondent which is a not-for-profit community organisation. The evidence of the Respondent supports a conclusion that there were three volunteers at the time of the Applicant’s employment cessation; that the volunteers were neither obliged nor required to attend work; and that each undertook work on a voluntary basis for the Respondent without expectation of payment. Importantly, there was no evidence of an intention to create legally binding employment relationships with respect to the volunteers. I am consequently satisfied that the volunteers were not employees as at 6 December 2017.

[26] If I am wrong in my conclusions regarding the status of the volunteers and that those three volunteers should be properly regarded as employees, the total number of employees would still fall short of 15. This is so given my earlier findings regarding the number of employees being 11 as at 6 December 2017 and my conclusions on the status of Board members and contractors.

[27] As I have found, there are no associated entities and the Respondent employed less than 15 employees at the time of the Applicant’s claimed dismissal. Consequently, I am satisfied that the Respondent was a “small business employer” at the time of the Applicant’s cessation of employment.

Conclusion

[28] Having found that the Respondent was a “small business employer” at the time of the Applicant’s employment cessation, I am satisfied that the Applicant has not completed the minimum employment period of 12 months with the Respondent at the time of her alleged dismissal (s 382(a) of the Act). I therefore uphold the Respondent’s jurisdictional objection concerning the minimum employment period. The Applicant’s unfair dismissal application is dismissed. An Order to that effect will be issued with this decision.

DEPUTY PRESIDENT

Appearances:

Ms Donna Bannister on her own behalf.

Mr Brodie Lewis on behalf of the Respondent.

Hearing details:

2018

Melbourne

25 May 2018

Printed by authority of the Commonwealth Government Printer

<PR607293>

 1   Exhibit R1, Witness Statement of Mr Brodie Lewis, dated 11 May 2018, Annexure C.

 2 Exhibit R2, Supplementary Witness Statement of Mr Brodie Lewis, dated 24 May 2018, Paragraph [10].

 3   Ibid at paragraph [4], Attachments A, B, C, D, E & F.

 4   Ibid at paragraph [6] – [9], Attachments G & H.

 5   Supplementary Witness Statement of Mr. Brodie Lewis, dated 28 May 2018.

6 Ibid at paragraphs [7] – [13].

7 Ibid at paragraphs [14] – [17].

8 Ibid at paragraphs [18] -23].

 9 Exhibit R1 at paragraph [3].

 10   Ibid, Annexure A.