Hamza Saeed v Allied Security

[2017] FWC 1212

[2017] FWC 1212

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Hamza Saeed
v
Allied Security
(U2016/12185)

DEPUTY PRESIDENT HAMILTON MELBOURNE, 9 MARCH 2017

Application for relief from unfair dismissal.

[1] On 6 October 2016 Mr Hamza Saeed (the applicant) lodged an application under s.394 of the Fair Work Act 2009 (the Act) for an unfair dismissal remedy.

[2] The matter was initially dealt with by conciliation conference. A representative from Allied Security (the respondent) participated and claimed that the applicant was not an employee of the firm he represented. The matter was not settled at conciliation.

[3] On 23 December 2016, the respondent formally lodged a jurisdictional objection to the application on the basis that the applicant was not an employee of the organisation and on 3 January 2017 provided correspondence to support their contention. Apart from this issue all the other jurisdictional requirements are met. Mr.Saeed is a person protected from unfair dismissal.

[4] Directions were issued requiring the respondent to file submissions by Monday 9 January 2017, and the applicant by 16 January 2017. The applicant filed submissions in relation to the employment relationship issue on 16 January 2017, and in relation to the alleged harsh dismissal issue on 1 March 2017. A file note records that the respondent advised the Commission during a telephone conversation on 8 February 2017 that the correspondence of 3 January 2017 constitutes the respondent’s submissions. In any event the respondent’s submissions were limited in nature to an assertion that it was not the employer and similar matters, without addressing the tests for an employment relationship, or the alleged harshness of the termination. They were apparently content not to dispute the submissions of the applicant on many or most issues.

[5] Both sides agreed that the matter be determined on the papers. In addition a telephone hearing was also held on 2 March 2017 to enable the parties to speak to their submissions and raise any issues if they wished to. No issues were raised.

[6] The matter was listed for jurisdictional and merit hearing, that is, hearing of both the employer jurisdictional objection and the issue of whether or not the termination was harsh, unjust or unreasonable.

Respondent

[7] The respondent’s jurisdictional application was a simple assertion that the applicant is not an employee of ‘this organization’, this being Auscall Security Pty Ltd, trading as Allied Security Australia Pty Ltd 1. He attached a letter from Epitome Services Pty Ltd which stated that Mr.Hamza Saeed was employed by that company on 6 June 2016, and finished his employment on 25 September 2016. In a further letter dated 15 February 2017 Mr.Black, under the letterhead ‘Allied’ and signing as ‘Managing Director’, repeated these submissions and stated that the current legal entity was Abacus Security Pty Ltd. On 2 February 2017 Mr.Black refers to the winding up process, apparently insolvency, but provides no evidence of insolvency. The employer generally put minimal submissions and largely left the matter to be determined by the Commission on the basis of the applicant submissions without contradiction.

Applicant

[8] The applicant submitted that Allied Security Australia Pty Ltd changed its name to Abacus Security Pty Ltd on 17 January 2017, but that this does not affect proceedings. It said that a search of the ASIC data base showed that there were no insolvency applications on foot regarding this company. It said that Mr.Gucic was listed as a Director of the company and that the applicant was entitled to direct correspondence to him. It submits that Mr.Black is now the sole director and majority shareholder of Allied Investments Ltd NZ, and that this company is the sole shareholder of Abacus. It provides company search documents to support this, and the respondent does not contradict this. It puts submissions in relation to each of the relevant indicia for an employment relationship and the factors in s.387, and submits that the termination was harsh, unjust or unreasonable.

Authorities

[9] In Jiang Shen Cia trading as French Accent v Do Rozario (French Accent) a Full Bench of the Commission summarised the tests for an employment relationship in the following terms:

“(1) In determining whether a worker is an employee or an independent contractor the ultimate question is whether the worker is the servant of another in that other’s business, or whether the worker carries on a trade or business of his or her own behalf: that is, whether, viewed as a practical matter, the putative worker could be said to be conducting a business of his or her own of which the work in question forms part? This question is concerned with the objective character of the relationship. It is answered by considering the terms of the contract and the totality of the relationship.

(2) The nature of the work performed and the manner in which it is performed must always be considered. This will always be relevant to the identification of relevant indicia and the relative weight to be assigned to various indicia and may often be relevant to the construction of ambiguous terms in the contract.

(3) The terms and terminology of the contract are always important. However, the parties cannot alter the true nature of their relationship by putting a different label on it. In particular, an express term that the worker is an independent contractor cannot take effect according to its terms if it contradicts the effect of the terms of the contract as a whole: the parties cannot deem the relationship between themselves to be something it is not. Similarly, subsequent conduct of the parties may demonstrate that relationship has a character contrary to the terms of the contract.

(4) Consideration should then be given to the various indicia identified in Stevens v Brodribb Sawmilling Co Pty Ltd and the other authorities as are relevant in the particular context.”

[10] The Full Bench went on to provide a summary of the indicia identified in the authorities. Each of these indicia are considered in turn below in light of the submissions and evidence of the parties.

[11] The applicant tendered his employment contract with Allied 2. This is a contract between Allied Security Australia Pty Ltd and Hamza Saeed the applicant. The contract states that it is a ‘sub-contractor agreement’. The applicant then addresses each of the indicia for an employment relationship.

Did the respondent exercise, or have the right to exercise, control over what work was performed and where it was performed?

[12] This is not specifically addressed, although implicitly it is addressed in the Applicant’s Outline of Argument at paragraph 21(a) and at paragraph [13] below and this suggests that the relationship was an employment relationship.

Did the respondent exercise, or have the right to exercise, control over the manner in which the work was performed?

[13] In this case the applicant submits that the respondent controlled the manner in which the applicant’s work was performed, including hours of work and location. The applicant was issued with a weekly roster, and on at least one occasion a request for a day off was declined, and his shifts were reduced without his input 3. Various emails were sent to the applicant by Allied regarding conduct of work such as the standard and cleanliness of patrol vehicles, key security, the Patrol Run Sheet, company policies, and so on4. The respondent does not contradict these claims. The contract with Allied provides in clause 12 that the applicant had to comply with all reasonable directions from Allied about customers. Clause 4 of the agreement provides significant restrictions on the applicant regarding the conduct of work including reputable and professional conduct, conflicts of interest, negotiations with customers over price, protection of copyright and property. I accept the claims of the applicant, and this suggests that the relationship was an employment relationship.

Did the respondent exercise, or have the right to exercise, control over the hours of work?

[14] He did as indicated above, and this suggests that the relationship was an employment relationship.

Did Mr. Saeed perform work for others or have a genuine and practical entitlement to do so?

[15] The applicant claims that he worked solely for the respondent on a full-time, 5 days a week, basis 5. The respondent does not claim otherwise. This suggests that the relationship was an employment relationship.

Did Mr. Saeed have a separate place of work?

[16] The applicant claims that he did not 6. The respondent does not claim otherwise. This suggests that the relationship was an employment relationship.

Did Mr. Saeed advertise his services to the world at large?

[17] The applicant claims that he did not 7, and the respondent does not claim otherwise. Clause 10 of the agreement with Allied states that the applicant could not ‘solicit the custom for work’. This suggests that the relationship was an employment relationship.

Did Mr Saeed provide and maintain significant tools or equipment?

[18] The applicant claims that the respondent provided all of his equipment and tools and specifies them 8, while the respondent does not claim otherwise. Clause 22 of the agreement with Allied provides that the applicant is responsible for damage to equipment and uniforms provided by Allied. The letter of termination from Mr.Gucic of Allied of 23 September 2016 states that the applicant is to return ‘all uniform and company items’. This suggests that the relationship was an employment relationship.

Could Mr Saeed delegate or subcontract the work to another?

[19] The applicant claims that any person arranged to cover a shift was to be approved by and was then paid by the respondent. 9 The respondent does not deny this. Clause 6 of the agreement with Allied states that the applicant may not sub-contract its obligations without consent. This suggests that the relationship was an employment relationship.

Did the respondent have the right to suspend or dismiss Mr Saeed?

[20] Not addressed.

Did the respondent present Mr Saeed as a representative of the business?

[21] The applicant claims that he acted as a representative of the respondent. By wearing the respondent’s uniform, his services were portrayed as being the respondent’s services. 10 The respondent does not deny this. This suggests that the relationship was an employment relationship.

Did the respondent deduct income tax from the remuneration paid to Mr Saeed?

[22] Not addressed.

Was Mr Saeed paid a periodic wage or salary or by reference to completion of tasks?

[23] The applicant submits that he was paid a salary by the respondent between 6 May 2015 and 5 August 2015. 11

[24] Was Mr Saeed provided with paid holidays or sick leave?

Not addressed.

[25] Did the work involve a profession, trade or distinct calling on the part of Mr Saeed?

Not addressed.

[26] Did Mr Saeed create goodwill or saleable assets in the course of his work?

Yes see paragraph [20] above.

Did Mr Saeed spend a significant portion of his remuneration on business expenses?

[27] The applicant claimed not 12 and the respondent did not deny this. This suggests that the relationship was an employment relationship.

[28] I also note that the applicant was dismissed by the respondent on 23 September 2016 13. The termination email14 refers to the applicant’s time with the company, and how he is a representative of the company and sleeping on duty is inappropriate. This suggests that the relationship was an employment relationship.

[29] The applicant also denies that there was a transfer of employment, and the respondent does not deny this.

[30] The applicant was invited to sign an employment application form with Epitome Services Pty Ltd and did sign such a form 15. The employment application form does not contain any terms and conditions of employment, or very few. Even on its face it is unclear what the purpose of the form is, other than to provide payroll data.

[31] The applicant claims that he did not change his work in any way after signing the form but continued to liaise with and receive emails from the respondent in relation to his work, including reminders to complete time and sign on sheets, notification of weekly rosters, notices regarding compliance with company policies and notifications regarding company procedures relevant to his work. There was not much communication with Epitome except regarding processing of pay. His employment contract with Allied was not terminated in accordance with clause 8 termination, which requires 30 days written notice to the other, and clause 17 which provides how notice shall be given. There is no evidence of such notice being given, and the termination of employment does not appear to constitute 30 days notice. It rather appears to be summary dismissal with immediate cessation of work and no further rosters from 23 September 2016. The respondent does not claim otherwise and I accept that this is a true version of events. The contract that the applicant had with the respondent remained on foot and was not terminated by whatever he had signed with Epitome.

[32] As a practical matter the applicant was not conducting his own business, but the business of the respondent. While the terms of his agreement with the employer purported to be an independent contractor relationship, the parties cannot alter the true nature of their relationship by putting a different label on it and deem the relationship between themselves to be something it is not. The indicia referred to above contradict the terms of the agreement and show that in substance the relationship was that of an employee working under the control and direction of the respondent. Having regard to all the relevant indicia stated above, I find that at the time of termination of employment there was an employment relationship between the applicant and respondent. The respondent’s jurisdictional application is dismissed.

[33] All the jurisdictional requirements are met and the remaining issue is that of s.387.

Section 387

[34] I am required by s.387 of the Act to take into account the matters specified in paragraphs (a) to (h) of the section in considering whether Mr Saeed’s dismissal was harsh, unjust or unreasonable. I will address each of these matters in turn below.

(a) Valid reason

[35] The applicant submits that he engaged in a one-off trivial misdemeanour (sleeping on duty) not sufficient to justify termination, did not impact on safety of other employees, was out of character and inconsistent with this previous good performance record, and was dealt with informally by the respondent and only raised when the applicant complained about his roster. The respondent does not deny this.

[36] Further, the sequence of events causes some concern. Mr.Saeed raised some concerns about his roster, namely he was only doing two shifts. He wanted more shifts 16. The employer responded to the email about wanting more shifts by refusing this request, and in the same email terminating his employment allegedly for sleeping in his car17. Mr.Saeed sought to explain why he was found sleeping, namely variation of day and night and long hours of shifts18. The employer responded by stating that he had removed himself from the roster19. Mr.Saeed responded by stating that he did not remove himself from the roster but rather wanted a fairer roster, and that he had been dismissed without being given a chance to explain himself20.

[37] There seems to be a mixture of reasons for termination, namely Mr.Saeed’s apparently reasonable attempts to discuss his roster, and his sleeping on the job. The first is not a valid reason for termination, and is inappropriate. The second is a valid reason, but there are mitigating circumstances which are not contradicted by the employer.

(b) Was the applicant notified of the reason for termination

[38] The applicant was notified of the reason for termination, namely sleeping while on duty 21.

(c) Opportunity to respond

[39] Apart from some email correspondence, where the applicant states he was removed from the roster without giving him any written warning and a fair chance to explain 22, the applicant was not given an opportunity to respond, rather he was simply terminated by email for the stated reasons. The employer did not ask him to respond to his claims about the stated reason for termination.

(d) Support person

[40] There was no meeting and no opportunity to have a support person.

(e) Warnings

[41] The applicant claims that he did not receive any warnings 23, and the respondent does not claim otherwise. I accept the employee claims.

(f)(g) Size and dedicated staff

[42] The size of the business is unclear and there appear to be dedicated operations staff responsible for rostering and such matters 24. There is little to count in favour of the respondent.

(h) Other factors

[43] I take into account the various factors raised by the applicant.

Conclusion

[44] I take into account the submissions of the applicant regarding the circumstances of the valid reason, which are not contradicted by the respondent. There seems to be a mixture of reasons for termination, namely Mr.Saeed’s apparently reasonable attempts to discuss his roster, and his sleeping on the job. The first is not a valid reason for termination, and is inappropriate. The second is a valid reason, but there are mitigating circumstances which are not contradicted by the employer. Having regard to those circumstances and the absence of procedural fairness, and all other matters, I find that the termination was harsh, unjust or unreasonable.

Remedy

[45] The applicant seeks compensation but has not addressed the tests for compensation in s.392. I provide the applicant with the opportunity to put a submission in relation to compensation by close of business Thursday, 16 March 2017, and give the respondent the opportunity to respond by close of business Thursday, 23 March 2017. I will then determine the matters on the papers unless a hearing is requested by either party.

DEPUTY PRESIDENT

 1   Form F4, signed by Mr.Damian Black

 2   Applicant’s Outline of Argument dated 16 January 2017, Attachment A1

 3   Applicant’s Outline of Argument dated 16 January 2017, paragraph 21(a)

 4   Eg. Attachment A18, A19

 5   Applicant’s Outline of Argument dated 16 January 2017, paragraph 21(b)

 6   Applicant’s Outline of Argument dated 16 January 2017, paragraph 21(c)

 7   Applicant’s Outline of Argument dated 16 January 2017, paragraph 21(c)

 8   Applicant’s Outline of Argument dated 16 January 2017, paragraph 21(d)

 9   Applicant’s Outline of Argument dated 16 January 2017, paragraph 21(e)

 10   Applicant’s Outline of Argument dated 16 January 2017, paragraph 21(g)

 11   Applicant’s Outline of Argument dated 16 January 2017, paragraph 21 (j)

 12   Applicant’s Outline of Argument dated 16 January 2017, paragraph 21(i)

 13   Applicant’s Outline of Argument dated 16 January 2017, paragraph 21(h)

 14   Applicant’s Outline of Argument dated 16 January 2017, Attachment A4

 15   Applicant’s Outline of Argument dated 16 January 2017, paragraph 26, Attachment A12

 16   Applicant’s Outline of Argument dated 16 January 2017, Attachment A4, 23 September 2016, 7.26 am

 17   Applicant’s Outline of Argument dated 16 January 2017, Attachment A4, 23 September 2016, 8.29 am

 18   Applicant’s Outline of Argument dated 16 January 2017, Attachment A4, 25 September 2016, 10.07 am

 19   Applicant’s Outline of Argument dated 16 January 2017, Attachment A4, 25 September 2016, 10.07 pm

 20   Applicant’s Outline of Argument dated 16 January 2017, Attachment A4, 25 September 2016, 10.42 pm

 21   Applicant’s Outline of Argument dated 16 January 2017, Attachment A4

 22   Email correspondence dates 25 September 2016, attachment A 4

 23   Applicant’s Outline of submissions, dated 1 March 2017, paragraph [35]

 24   Applicant’s Outline of submissions, dated 1 March 2017, paragraph [37]-[39]

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