Fay v McGilvray Aviation Pty Ltd

[2022] FedCFamC2G 873

Federal Circuit and Family Court of Australia

(DIVISION 2)

Fay v McGilvray Aviation Pty Ltd [2022] FedCFamC2G 873  

File number(s):

DNG 7 of 2022

Judgment of:

JUDGE YOUNG

Date of judgment:

30 September 2022

Catchwords:

INDUSTRIAL LAW – FAIR WORK – where the Applicant was employed for a period of about seven weeks – where the Applicant claims unpaid wages and allowances – whether the Applicant was entitled to notice as set out in the contract of employment between the Applicant and Respondent  

Legislation:

Fair Work Act 2009 (Cth)

Air Pilots Award 2020  

Division:

Division 2 General Federal Law

Number of paragraphs:

26

Date of hearing:

28 and 30 September 2022

Place:

Darwin

The Applicant:

Appearing on her own behalf

The Respondent:

Mr McGilvray on behalf of the Respondent

ORDERS

DNG 7 of 2022

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)

BETWEEN:

VIRGINA FAY

Applicant

AND:

MCGILVRAY AVIATION PTY LTD

Respondent

order made by:	JUDGE YOUNG
DATE OF ORDER:	30 SEPTEMBER 2022

THE COURT ORDERS THAT:

1.The Respondent pay the Applicant $11,018.47.

2.The matter is otherwise dismissed.

Note: The form of the order is subject to the entry in the Court’s records.

Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).

REASONS FOR JUDGMENT
Ex Tempore

JUDGE YOUNG

1. This is an application under the Fair Work Act 2009 (Cth) (“the Act”) for recovery of unpaid wages and allowances. The applicant was employed by the respondent as a pilot. The employment relationship was governed by the Act, the Air Pilots Award 2020 (“the Award”), a contract of employment (“the Agreement”) and, according to the applicant, certain understandings and instructions which constituted oral terms. 

2. On or about 2 October 2020, the applicant signed a written contract of employment and returned it to the respondent on or about that day.  The respondent had proposed the written contract and characterised it as an offer and the return of the contract by the applicant as acceptance by email correspondence. At the time the agreement was reached between the parties the applicant was instructed that she would need to obtain an Instrument Proficiency Check (“IPC”) in relation to her instrument flight accreditation.  Nothing was said about who was to pay for that which, according to the documents provided by the applicant was $1,000 for the test and $1,870 for associated aircraft time.  The applicant successfully completed the IPC on 17 October 2020.  The applicant was told to report for work at Mareeba on 25 October 2020 which was away from the respondent’s home base on Horn Island.  She was instructed to collect and ferry an aircraft to Horn Island.

3. It was necessary that she travel from her home and stay overnight in Mareeba to be ready to collect the aircraft the next morning and fly it to Horn Island.  The unchallenged evidence of the applicant was that 95 per cent of her flying duties involved flying as commander a Britten-Norman Islander twin-engine aircraft.  It was not in doubt that following her IPC she was qualified to fly the aircraft by instrument. The applicant therefore said that her award entitlements under the Award was a base salary of $53,160 on the basis that she was flying a multi-engine aircraft of up to but less than 3360 kilograms as commander and that she was instrument rated as commander which saw an additional allowance in her salary of $5,487. I accept that her annual salary according to the award was $58,647 and $29.68 per hour over her normal 38 hour week.

4. The applicant was paid at varying rates during her employment which commenced with her ferrying the aircraft from Mareeba on 25 October 2020 until her dismissal on 11 December 2020.  She was paid at varying rates from $22.05 per hour to $25.67 per hour. According to the respondent this discrepancy was because she was initially paid as a single-engine pilot until she was passed by the chief pilot to fly the Britten Norman Islander. In my view, there was no basis for such a distinction as the applicant gave unchallenged evidence that she flew the Britten Norman Islander from the outset of her employment.  In any case, both rates were underpayments of her due salary. 

5. The respondent said that the applicant was not entitled to the instrument rating allowance because she had not been approved by the chief pilot to fly by instrument at any point in the approximate seven weeks of her employment.  No reason was given for the delay for approval by the respondent. In circumstances where the applicant substantially performed in the role of an instrument-rated command pilot of the Britten Norman Islander, I am satisfied that there was no basis for not paying her at the full rate from the beginning.

6. The other notable factor is that the applicant worked considerably longer hours than the 38 hour per normal week provided for in the National Employment Standards under the Act. Over seven weeks, a 38-hour week would be equivalent to about 266 hours at the normal hourly rate. The respondent conceded, as was apparent from the payslips, that over that period the applicant worked 306 hours. The applicant says that she, in fact, worked 345 hours. I do not find it necessary to decide that dispute but whether the additional hours were 40 hours or 80 hours, this is a significant number of additional hours.

7. As I have mentioned, the National Employment Standards say that the normal hours of 38 hours may be averaged but in the seven weeks of the applicant’s employment, there is no sign of averaging and no indication that anything of the kind was likely. Under the Act, where an employee is required to work unreasonable additional hours, this does not result in an overtime payment but permits the employee to refuse to perform the overtime. In this case, the applicant did not refuse to perform the overtime, and I am not satisfied that she is entitled, as she claimed, to have those additional hours paid at the hourly rate that I have identified.

8. The applicant’s employment was terminated without notice on 11 December 2020.  She was not paid in lieu of notice.  It was not claimed by the respondent that she was guilty of serious misconduct.  It was asserted that her employment was terminated because she was unable to satisfy the chief pilot that she was able operate a single-engine aircraft or aircraft in the plural in the Cessna 200 series competently.  The truth or otherwise of that claim is not relevant in my view and it is unnecessary to make a finding. 

9. I will address the applicant’s claims as follows.

10. The first is a claim for underpayment of salary and associated superannuation.  I am satisfied that there was an underpayment of salary of $1,234.67 and the superannuation component of that at 9.5 per cent is an additional $117.29.

11. The second claim is for overtime for additional hours.  I have rejected that claim for the reasons given above. 

12. The third claim is for the cost of the IPC.  Clause 7 of the Agreement provides:

    The costs associated with any instrument rating, renewal or licence proficiency test or training required of the pilot by the Civil Aviation Safety Authority during the term of the agreement shall be borne by the operator.

    It was not in dispute that the IPC was required by the respondent.  The respondent says that having an IPC was a fundamental term and a precondition of the applicant being able to discharge her duties.  It is significant, in my view, that the chief pilot did not approve the applicant for instrument flying.  Nevertheless, she continued to work and she was not paid the instrument flight loading on her salary.  I am not satisfied that the IPC was a fundamental precondition of her employment but I am satisfied that it was desirable in the eyes of the respondent.

13. The respondent said that the cost incurred by the applicant was not incurred “during the term of the Agreement” which, according to the respondent, ran from 25 October 2020 to 11 December 2020.  I reject that interpretation.  In my view, obligations arose under the contract from 2 October 2020, including the obligation to report for work at Mareeba on 25 October 2020.  In my view, the IPC cost was incurred during the term of the Agreement. However, I find that the costs “associated” were limited to the cost of the IPC test which was $1,000 and the necessary aircraft hire of $1,875. I am not satisfied it included incidentals claimed by the applicant, such as travel allowance and accommodation allowance.  The amount under that heading that I find is owed is $2,875.

14. The next claim relates to another clause of the Award that was in issue concerning an allowance for what was described as a “50-hour inspection”.  The applicant gave unchallenged evidence that she conducted an oil change and visual inspection of the engine, presumably of the Britten Norman Islander, on two occasions and she said this constituted the 50-hour inspection.  The respondent provided a checklist in blank which Mr McGilvray, the director of the respondent, asserted was the checklist for the 50-hour inspection.  The applicant said she had not seen such a checklist and the 50-hour inspection she had undertaken were not conducted with the assistance of a checklist. I accept that the applicant believed that she was conducting a 50-hour inspection but I am not satisfied that the inspection was as extensive as that set out in the blank checklist. Further, I am not satisfied that the 50-hour inspection that the applicant believes she carried out was the inspection referred to by the award.  There is no allowance for that item. 

15. The applicant also claimed various allowances for spending time away from her home base on Horne Island at Mareeba, generally when it was necessary to ferry an aircraft to Mareeba for maintenance or some engineering work as I understood the evidence. These allowances for meals and accommodation were not paid in full by the respondent and I accept the applicant’s evidence about that.  Those items totalled $522.33 cents and that figure will be allowed. 

16. The next item relates to uniform allowances.  I am not satisfied that the applicant’s claim for uniform allowance is made out.  It is clear that the respondent provided three uniform shirts, albeit two of them were apparently used.  There is no requirement in the contract for provision of new shirts.  It might be thought to be niggardly by the employer but I am not satisfied it was in breach of contract.  There is no allowance for that claim.

17. The applicant also claimed an allowance for working on her “rostered days off”. While I acknowledge that, for the most part, she only had one day off a week on a Saturday, I am not satisfied that technically she was required to work on her rostered day off.  There is no allowance for that. 

18. The next claim relates to the respondent deducting a fee from the applicant’s final pay referred to as a “cleaning fee”. This fee was asserted by the respondent to be the result of having to clean the applicant’s room at the end of her employment. The applicant denied that the room was left in a filthy state as claimed by the respondent. Regardless of the truth or falsity of those claims, which I do not propose to resolve, I am satisfied that there is no legal basis for the deduction of such a cleaning fee in the Agreement or for any other reason. That amount will be added back to the amounts that the applicant is entitled to. 

19. The applicant claimed pay in lieu of one month’s notice that she said she was entitled to pursuant to clause 10 of the Agreement.  In response to that claim, the respondent said that clause 2A of the Agreement relieved it of responsibly to give notice or payment in lieu.  Clause 2A of the contract provides as follows:

    That a Pilot will be subject to a minimum of three (3) months probation.

    Nothing else is said about the consequence of such a clause and there is no further mention of probation in the Agreement. This clause has every sign of being added as an afterthought and very possibly by someone who was not legally trained.  Nevertheless, it is necessary to construe the meaning of that clause.  In my view, the meaning of that clause is unclear.  As I have said, nothing else is said about notice in the contract.  A probationary period at common law depends on the:

    …intention of the parties, looking at the whole of the agreement.  A probation clause may be treated as a fixed term contract with the employment expiring at the end of the period, and only if the employee is satisfactory will he or she be rehired.  In other cases, such terms have been construed as permitting an employer to dismiss at the end of the probationary period if the employer reasonably concludes that the probationer’s performance was unsatisfactory.[1]

    [1]Creighton, WB and Andrew Stewart, Labour Law (Federation Press. 6th ed. 2016)

20. It is noteworthy that the applicant was dismissed from her employment before the end of the probation period.  There is no evidence from the respondent that it reasonably concluded that the applicant’s performance was unsatisfactory, although it is clear that the chief pilot was unhappy with the applicant’s competence at flying a Cessna aircraft. Ultimately, the chief pilot did not conclude, according to the reports that are annexed to the respondent’s affidavit, that the applicant was competent to fly that aircraft.  Nevertheless, the applicant continued to fly a twin-engine aircraft throughout her employment without any criticism of her competence with that aircraft.

21. The applicant said, and I accept, that prior to her employment she had flown approximately 500 hours on a Britten Norman Islander twin-engine aircraft, that her experience in the Cessna 200 series was very limited and that she needed to get her experience up.  I accept that evidence, and I am not satisfied that the respondent reasonably concluded that the performance of the applicant overall in her employment was unsatisfactory.  Nevertheless, I acknowledge that some effort may be made to give the term some business efficacy. 

22. Under the Act, a small business, which I assume the respondent is, may terminate the employment of an employee without being subject to the unfair dismissal provisions of the Act. The minimum period of employment, however, may be reduced by the employer. There is nothing in the Agreement to suggest that the objective contractual intention of the parties was to remove the right to any notice. In any event, the Award provided for two weeks’ notice for an employee in the applicant’s position, that is, having less than one year’s service. I am not satisfied that the term about probation affected the applicant’s contractual right to one month’s notice as provided in clause 10 of the Agreement. One month’s notice of her salary at $58,647 a year is $4,887.25. In addition, I am satisfied that there needs to be a payment of superannuation according to the superannuation guarantee of 9.5 per cent of that, which amounts to $464.29.

23. I have considered whether there ought to be an order that that amount be paid into the superannuation fund nominated by the applicant, but I have no confidence that such an order would be complied with by the respondent. As for the applicant’s claim, while in part a claim for underpayment of wages, it is also, in my view, a compensatory claim and I have jurisdiction to make an order that the amount of the superannuation entitlement be paid as compensation directly to the applicant. That that is what I propose to do.  The total of those two amounts is $5,351.54. 

24. The next item claimed by the applicant was a claim for the notice period of $300 per week which she suggested somehow derived from what was said to be the value of her accommodation, which was apparently agreed to be worth $300 a week. I consider that, as she was no longer required to be at Horn Island, there is no right to that amount and the claim is misplaced in my view.  There is no allowance for that. 

25. The next item is a claim for the accrued and unpaid annual leave in respect of the notice period.  The contract provided that there were to be 42 days leave, or six weeks leave per year.  Only four weeks of that period would attract leave loading of 17.5 per cent.  According to my calculation, at six weeks a year, that is equivalent to half a week accruing over one month.  So the value of the one week’s accrued leave is $563.91 cents.  The leave loading, at 17.5 per cent, accrues on only two-thirds of that, and that amount is $65.72 cents.  The total of those amounts is $629.63.

26. The total amount owed to the applicant is $11,018.14.Accordingly, there will be an order that the respondent pay that amount.  I do not propose to allow any time and that amount becomes due now.

I certify that the preceding twenty-six (26) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Young.

Associate:

Dated:       20 October  2022