Dorsch v Head Oceania Pty Ltd

Link copied
Case Copied 56 min read

FEDERAL COURT OF AUSTRALIA

Dorsch v HEAD Oceania Pty Ltd [2024] FCAFC 133  

Appeal from: Dorsch v HEAD Oceania Pty Ltd [2024] FCA 162
File number: NSD 354 of 2024
Judgment of: SNADEN, HATCHER AND SHARIFF JJ
Date of judgment: 18 October 2024
Catchwords:

INDUSTRIAL LAW – appeal from primary judgment dismissing various claims for adverse action, unreasonable work hours and breach of contract (save for one claim in relation to a conceded failure to pay accrued annual leave entitlements upon termination) – where claims arose out of events leading up to, and including, summary termination of appellant from his employment with respondent – where appellant had been simultaneously employed by respondent and Hong Kong-based entity within same corporate group – where primary judge held that many of appellant’s claims related to his employment with other entity – where appellant’s employment with both entities summarily terminated on basis of conduct toward subordinates – whether primary judge erred by finding that person put forward by respondent as having made termination decision was an agent of respondent and that, by virtue of his evidence, respondent had rebutted statutory presumption in s 361 of Fair Work Act 2009 (Cth), on basis that that person was not an employee or officer of respondent – whether primary judge erred by finding that alleged adverse action relating to “unfair scrutinisation” was not taken by respondent and that appellant was not injured in employment by reason of that conduct – whether primary judge erred by finding that asserted workplace rights in form of “unreasonable hours complaint” and “lack of support complaint” concerned employment with other entity and did not involve actual or proposed exercise of workplace rights – whether primary judge erred by finding no “adverse action by omission” – whether primary judge erred by finding that appellant had failed to establish that he worked excessive hours or that there was a request or requirement that he work those hours – whether primary judge erred by failing to calculate entitlement to payment of accrued annual leave upon termination on basis of combined remuneration from both entities – no errors established – appeal dismissed

PRACTICE AND PROCEDURE – where Notice of Appeal filed in circumstances where proceedings at first instance had only determined questions of liability but not penalties and costs – Monash Health v Singh [2023] FCAFC 166; (2023) 327 IR 196 applied – held that primary judgment interlocutory in nature and leave to appeal required – held that application for leave filed out of time and extension of time required – extension granted – where appellant sought leave to file an Amended Notice of Appeal – application granted – leave to appeal granted in circumstances where no prejudice to respondent and where all questions of penalties and costs arising from primary judgment had been finally determined by time of appeal
Legislation:

Fair Work Act 2009 (Cth) ss 12, 62, 90(2), 341, 341(1)(b) and (c), 342, 342(1) (items 1(b) and (c)), 361, 793, 793(1) and (2);…

CaseChat AU logo

Keep reading for free

Create a free CaseChat account to read Dorsch v Head Oceania Pty Ltd and more:

  • Read every judgment in full
  • Ask AI and get answers linked to paragraphs
  • See how each paragraph was cited in later cases
  • Download judgments as PDF or Word
Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details
Case
[2024] FCAFC 133
Decision Date

CaseChat Overview and Summary

Dorsch v Head Oceania Pty Ltd involved the appeal by Dorsch against the dismissal of his various claims for adverse action, unreasonable work hours, and breach of contract, except for the failure to pay accrued annual leave entitlements upon termination. Dorsch had been employed simultaneously by Head Oceania and its Hong Kong subsidiary, Mares Asia Pacific. His employment was terminated on account of his conduct towards subordinates. Dorsch challenged the primary judge's findings that many of his claims related to his employment with Mares Asia Pacific, that the decision-maker was an agent of Head Oceania, that the adverse action claims were not taken by Head Oceania, that there was no adverse action by omission, and that Dorsch had not established he worked excessive hours or that there was a request or requirement that he work those hours.

The court found no errors in the primary judge's reasoning. Dorsch's argument that Mr Skrobanek, who made the termination decision, was not an agent of Head Oceania was rejected because the primary judge had found that Mr Skrobanek had the authority to make decisions regarding employment, and his decision was implemented by Head Oceania. Dorsch's claims of adverse action were found not to have been taken by Head Oceania as they related to his employment with Mares Asia Pacific. Dorsch's claims of unreasonable work hours and lack of support were also found to concern his employment with Mares Asia Pacific, not Head Oceania. Dorsch failed to establish that he worked excessive hours or that there was a requirement for him to do so.

The appeal was dismissed, and leave to appeal was granted despite being filed out of time, as all questions of penalties and costs had been finally determined by the time of appeal. The court granted an extension of time and leave to file an Amended Notice of Appeal.

Orders

Orders of the court

1. Leave to appeal be granted.

2. The appeal be dismissed.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

The result of the above is that an extension of time and leave to appeal is granted, as well as leave to rely on the amended grounds of appeal. Our reasons proceed on those bases.C. UNCONTESTED FACTS The following facts concerning Mr Dorsch’s employment history are uncontroversial and are drawn from the unchallenged findings made by the primary judge. Mr Dorsch had worked the majority of his adult life, from apprenticeship in 1996 until 2021 (with a break between 2000 and 2008) for various entities within the “HEAD Group”: PJ [1]. After initially working in Germany until 2000, Mr Dorsch was approached eight years later by Mr Stefan Michl (Mr Michl) and Mr Gerald Skrobanek (Mr Skrobanek), about undertaking a role for Mares Asia Pacific (Mares AP)), the HEAD Group’s Hong Kong subsidiary. Mr Dorsch then relocated to Hong Kong in May 2008: PJ [1]. In 2010, Mr Dorsch relocated to Queensland to work in the Australian subsidiary (Head Oceania) and had, since that time, resided and worked primarily in Australia: PJ [1]. Importantly, Mr Dorsch did not become employed by, and commence employment with, Head Oceania until on or after 7 March 2018: PJ [1], [229]-[231]. Mr Dorsch’s employment with Head Oceania was governed by a contract of employment that was entered into on 15 October 2018 and which was referred to as the “2018 Employment Contract”: PJ [3], [22], [328]. Although Mr Dorsch commenced employment with Head Oceania, he remained employed (simultaneously) by Mares AP and undertook Hong Kong-related work: PJ [1]. Mr Dorsch remained employed by both Head Oceania and Mares AP until 10 December 2021: PJ [2]. At that time, his employment with both entities was terminated. The termination was given effect to by a letter dated 10 December 2021, signed by Mr Skrobanek in his position as Chief Operating Officer of the “HEAD Mares Group” and countersigned by Ms Gefion Hauer in her position as General Counsel of the “HEAD Mares Group”. As we will return to further below, Mr Dorsch did not dispute the fact that the termination of his employment had been validly effected. Mr Dorsch’s employment was summarily terminated on account of the manner in which he treated subordinate employees which had led to a number of them making complaints about him and/or resigning from their positions: PJ [2]. Although Mr Dorsch claimed in the proceedings below that Head Oceania did not have grounds to summarily terminate his employment, the primary judge found otherwise and those findings are not challenged: see, e.g., PJ [5], [431], [443]-[444]. D. MR DORSCH’S CLAIMS AND THE PRIMARY JUDGMENT It is next convenient to address briefly the claims made by Mr Dorsch in the proceedings below and the primary judge’s reasons for (largely, with one exception) rejecting those claims. Many of the claims that Mr Dorsch advanced in the proceedings below centred upon the theme that he had been subjected to adverse action (including both in relation to his dismissal from Head Oceania as well as other actions which came to be described as the “non-dismissal adverse action”) because he had made complaints about his statutory leave entitlements and unreasonable work hours, and otherwise exercised various workplace rights. Mr Dorsch also advanced separate claims that Head Oceania had contravened other provisions of the FW Act including those relating to the payment of annual leave and working unreasonable hours, as well as claims that Head Oceania had breached the 2018 Employment Contract.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Mr Dorsch’s employment was summarily terminated on account of the manner in which he treated subordinate employees which had led to a number of them making complaints about him and/or resigning from their positions: PJ [2]. Although Mr Dorsch claimed in the proceedings below that Head Oceania did not have grounds to summarily terminate his employment, the primary judge found otherwise and those findings are not challenged: see, e.g., PJ [5], [431], [443]-[444]. D. MR DORSCH’S CLAIMS AND THE PRIMARY JUDGMENT It is next convenient to address briefly the claims made by Mr Dorsch in the proceedings below and the primary judge’s reasons for (largely, with one exception) rejecting those claims. Many of the claims that Mr Dorsch advanced in the proceedings below centred upon the theme that he had been subjected to adverse action (including both in relation to his dismissal from Head Oceania as well as other actions which came to be described as the “non-dismissal adverse action”) because he had made complaints about his statutory leave entitlements and unreasonable work hours, and otherwise exercised various workplace rights. Mr Dorsch also advanced separate claims that Head Oceania had contravened other provisions of the FW Act including those relating to the payment of annual leave and working unreasonable hours, as well as claims that Head Oceania had breached the 2018 Employment Contract. As became apparent to the primary judge, Mr Dorsch’s claims did not clearly delineate between those claims that related to his employment with Mares AP and those that separately related to his employment with Head Oceania. The primary judge found that many of Mr Dorsch’s claims related to entitlements pertaining to his employment with Mares AP and/or that the complaints he made about those entitlements pre-dated his employment with Head Oceania. It is also both relevant and necessary to note at the outset that, in dismissing Mr Dorsch’s claims, the primary judge made a number of findings relating to Mr Dorsch’s credibility, and that of other witnesses. Specifically, the primary judge found that Mr Dorsch was an unreliable witness: PJ [28]-[34]. By contrast, the primary judge found that other witnesses including, most critically, Mr Skrobanek and Mr Michl were credible and reliable witnesses and/or that their evidence should be preferred to that given by Mr Dorsch: PJ [37]-[65]. Mr Dorsch does not challenge the primary judge’s findings as to the credit and credibility of the various witnesses. D.1 The Annual Leave Claim - conceded in part and otherwise rejected Mr Dorsch claimed that Head Oceania failed to pay his entitlement to accrued annual leave “in full” upon the termination of his employment, as was required by the terms of the 2018 Employment Contract and s 90(2) of the FW Act (the Annual Leave Claim). Mr Dorsch further claimed that Head Oceania had breached the 2018 Employment Contract and contravened s 90(2) of the FW Act by failing to correctly calculate the amount of pay he should have received in respect of his accrued annual leave entitlement at the time of the termination of his employment. In this regard, Mr Dorsch claimed that the amount payable should have been, and should be, calculated on the basis of his combined remuneration from Head Oceania and Mares AP: PJ [319].

Ratio Decidendi

Legal Principle Established

We deal with each issue in turn.F. CONSIDERATIONF.1. Issue 1 – Grounds 1 and 2 The first issue that arises in the appeal is whether the primary judge erred by finding that Mr Skrobanek was the agent of Head Oceania and, by virtue of his evidence, that Head Oceania had rebutted the statutory presumption under s 361 of the FW Act in terminating Mr Dorsch’s employment. Mr Dorsch submitted that Head Oceania’s Constitution vests the management of that company in its directors. He contended that, as Mr Skrobanek was not an employee or officer of Head Oceania, he did not have the actual or apparent authority to terminate Mr Dorsch’s employment, nor was there any evidence establishing that Head Oceania had conferred any such authority upon Mr Skrobanek. Further, Mr Dorsch submitted that the word “agent” contained in s 793 of the FW Act should be understood to have been used in its established sense as a legal term of art (citing Mie Force Pty Ltd v Allianz Australia Insurance Ltd [2024] NSWCA 23 at [122]) as describing persons with authority to create binding legal relations between a principal and third parties or to end those relationships. It was submitted that the relationship of agent and principal can only be established by the consent of both parties and that there was no evidence of any such consent to appoint Mr Skrobanek as an agent of Head Oceania. Mr Dorsch submitted that Mr Skrobanek’s leadership roles in other entities within the Head Group did not make him an agent of Head Oceania. Mr Dorsch next contended that, as Mr Skrobanek did not have any authority (actual or apparent), Head Oceania did not rebut the presumption in s 361 of the FW Act. He contended that the question of whether a body corporate has contravened the FW Act must be answered by assessing the state of mind attributed to the body corporate, against the elements of the contravention said to have been committed by it. It was submitted that as Mr Skrobanek did not have any authority, his state of mind was irrelevant to Head Oceania rebutting the presumption. Mr Dorsch submitted that:It is this question of who has legal power to dismiss the Appellant that Mr Dorsch contends should trouble the Court. At its highest, Mr Dorsch submits that Mr Skrobanek could determine that the Appellant be dismissed but could not effect that decision, which it says needed to be done by the Respondent. During the course of oral submissions before us, Counsel for Mr Dorsch developed the argument on the basis that there was no challenge to whether the termination was validly effected or the fact that Mr Skrobanek had the authority to determine whether to terminate the employment, but that Mr Skrobanek had no authority to implement the decision. The following exchanges that occurred during the course of oral submissions identify the way in which the argument was ultimately put: SNADEN J: You also don’t take issue, do you, with the fact of termination?MR BRITT: No.SNADEN J: As an act engaged in by the respondent. MR BRITT: We don’t.SNADEN J: As a valid act.…SHARIFF J: Because you don’t challenge the anterior finding of fact, isn’t it a factual basis from which to infer, that Mr Skrobanek had at least ostensible or apparent authority in respect of decisions to be made, in respect of the appellant’s employment? MR BRITT: Well, your Honour, we say it goes the other way. We say what it does show is that Mr Skrobanek can make decisions, but other people are required to implement those decisions. That is, agree to the decision and implement it.HATCHER J: That’s a theoretical rather than factual proposition, isn’t it?MR BRITT: What was that, your Honour?HATCHER J: That’s a theoretical rather than factual proposition. The simple fact is, there was a finding made by the primary judge that Mr Skrobanek was the decision-maker for the dismissal, and was the person who effected and communicated the dismissal.MR BRITT: That – and yes, and that he was an agent of - - - HATCHER J: Well, leaving aside agency that they’re the factual matters that are unchallenged in the appeal, aren’t they?MR BRITT: Correct, but at the end of the day, it is the respondent that actually has to terminate the appellant. And that required a decision by the respondent, and we do not have any evidence from any persons within the respondent as to why they followed the instruction or decision of Mr Skrobanek to terminate the appellant.…MR BRITT: But what we have in this case is, even Mr Skrobanek says, he requires someone else to implement a bonus.SHARIFF J: That’s an implementation issue. It sounds like you’re accepting that he had – the decision-making power resided with him.MR BRITT: He has the power to decide, he doesn’t then have the power - - -SHARIFF J: You accept then, he has the power to decide.MR BRITT: Yes, and we’ve said that in our submissions. He can make a decision, but what then flows from that is other persons have to agree with that decision in order to terminate the appellant’s contract.