Jetgo Australia Holdings Pty Ltd v Goodsall

[2015] FCCA 1378

FEDERAL CIRCUIT COURT OF AUSTRALIA

JETGO AUSTRALIA HOLDINGS PTY LTD v GOODSALL [2015] FCCA 1378

Catchwords:
INDUSTRIAL LAW – Contraventions of Fair Work Act – assessment of compensation – whether the Applicant and/or respondent breached the employment contract.

Legislation:

Fair Work Act 2009, ss.45, 136, 139, 323(1)(a) and 567(c)

Air Pilot Award 2010 cls.2.2, 2.4, 12.7, 13.1, 16, 16.2, 16.5, 19, 20.1 and 24

Applicant: JETGO AUSTRALIA HOLDINGS PTY LTD

Respondent: ANDREW GOODSALL

File Number: BRG 135 of 2014

Judgment of: Judge Vasta

Hearing dates:

9 & 10 February 2015,

24 & 25 March 2015,

 4 & 8 May 2015

Date of Last Submission: 8 May 2015

Delivered at: Brisbane

Delivered on: 28 May 2015

REPRESENTATION

Counsel for the Applicant: Mr Harding

Solicitors for the Applicant: M + K Lawyers

Counsel for the Respondent: Mr Murdoch  QC

Solicitors for the Respondent: Mooloolaba Law

ORDERS

THE COURT DECLARES THAT:

1. The Respondent has contravened:

   (a)s.45 of the Fair Work Act 2009 (Cth) in not giving 2 weeks’ notice and is liable to a pecuniary penalty;

2. The Applicant has contravened:

   (a)s.45 of the Fair Work Act 2009 (Cth) in that it failed to pay superannuation at the time that it was due and is liable to a pecuniary penalty;

   (b)s.45 of the Fair Work Act 2009 (Cth) in that it failed to pay accrued annual leave upon the resignation of the Respondent and is liable to a pecuniary penalty

3. That the Respondent has breached the contract of employment in not being responsible for the costs of type rating training.

4. The Applicant is entitled to restitution on the basis that the consideration paid for the July 2013 training wholly failed in circumstances where it would be unjust for the Respondent to retain the benefit of such training at the expense of the Applicant.

THE COURT ORDERS THAT:

1. The Respondent pay the Applicant the sum $21,000.00 plus interest for the breach of contract in not paying for his training costs.

2. The Respondent pay to the Applicant the sum of $11,775.00 plus interest as restitution in relation to the consideration for the payment of training.

3. The Respondent’s cross-claim for deductions from pay be dismissed.

4. The Respondent’s cross-claim for underpayment in contravention of the Fair Work Act 2009 (Cth) be dismissed.

5. The Respondent’s cross-claim for a declaration that the Applicant contravened the Fair Work Act 2009 (Cth) in relation to training costs be dismissed.

6. The Applicant pay the Respondent the sum equivalent to 2.0146 days of annual leave with interest.

7. That the Respondent’s cross claim for contravention of Australian Consumer Law be dismissed.

8. That the Respondent’s cross-claim for breach of contract be dismissed.

9. That the matter be adjourned for hearing in relation to the issues of costs and of pecuniary penalty arising from the declarations set out in these orders.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT BRISBANE

BRG 135 of 2014

JETGO AUSTRALIA HOLDINGS PTY LTD

Applicant

And

ANDREW GOODSALL

Respondent

REASONS FOR JUDGMENT

Introduction

1. This is a matter brought pursuant to the Fair Work Act 2009 (Cth) (“FW Act”). In short compass it involves the employment of the Respondent Andrew Goodsall, by the Applicant, Jetgo Australia Holdings Pty Ltd.

2. The Applicant is a company that operates aircraft. Initially the company was supplying charter flights from large urban centres to remote mining areas mainly for the benefit of “fly in fly out” workers. The company had ambitions to expand their operations to include providing for Regular Public Transport (RPT) but had yet to do so during the period in which this matter is concerned.

3. The Respondent is a pilot who, previous to his employment with the Applicant, had been flying with Emirates Airlines. As a result of this, he was based in Dubai. He was recruited by the Applicant, as it was felt that someone with the Respondent’s experience would help the company achieve its expansion program.

4. During the trial, I heard evidence from Mr Jason Ryder, the Chief Executive Officer of the Applicant, Mr Paul Bredereck (for all intents and purposes the owner of the Applicant) and Mr Arron Mulder the Chief Operating Officer of the Applicant. I also heard evidence from the Respondent. There are many issues to be determined in this matter and findings of both fact and the law that have to be made. Having listened to the evidence, I have made the following findings of fact.

The Employment of the Respondent

1. The Respondent is an experienced and well credentialed pilot. From December 2005, he had been working at Emirates Airlines predominantly flying Boeing 777 aeroplanes in the latter part of his tenure at that airline. During his employment with Emirates, the Respondent provided classroom, simulator and flight training for pilots (including senior captains) as well as conducting checks on the proficiency of the flight crew.

2. The Respondent had wanted to raise his family in Australia. He already had investment properties in Australia but wanted to actually live, and raise his children, in Australia. As a result of this desire, the Respondent, throughout 2012, was looking for employment with an Australian aviation company or airline; his wife and children having already moved from Dubai to the Sunshine Coast area.

3. In the timeframe at the beginning of 2013, the Respondent became aware of the existence of the Applicant company. He became aware of the Applicant’s desire to engage experienced flight crew personnel. He knew Mr Bredereck because he had worked for him in 1996. He contacted Mr Bredereck by email and a meeting was arranged.

4. That meeting occurred in early January 2013 and it was between Mr Ryder, Mr Mulder, Mr Bredereck and the Respondent. In that meeting, the officers of the Applicant informed the Respondent about the plans that they had to grow the airline. The role that the Respondent was to fill was that of Head of Training and Checking (“HOTAC”). (I note that the Award uses the term “check pilot” to cover a HOTAC.) For this to occur the Respondent had to obtain a type rating for the aeroplanes that the Applicant operated. These planes were Embraer jets.

5. The Embraer jets were not used in Australia until the Applicant started using them. There were two kinds of jets; the Embraer 135 and the Embraer 145. These jets were very similar with the difference being that the 135 jet could carry 37 passengers and the 145 jet could carry 50 passengers (though for the period of the Respondent’s employment, the Applicant did not have the Embraer 145 jet). The facility that the Applicant used for its pilots to obtain the type rating for these jets was located in St Louis, Missouri in the United States of America.

6. It was explained to the Respondent that he would need to achieve his type rating for the Embraer jets before he could commence employment with the Applicant. It was also explained to the Respondent that he would be responsible for the costs of this training but that the Applicant would reimburse that cost over a period of two years. The cost of the training was $39,600.00.

7. I find that this arrangement is a common arrangement within the aviation industry. Whilst pilots must pay for their training, it is training that can then be used for their personal benefit. A company would generally repay that cost of the training over a period of two years to ensure that the company would have the benefit of that individual for the period of two years. I find that this arrangement would have been of no surprise to the Respondent because he knew that such arrangements were de riguer within the aviation industry.  Such an arrangement is not a “training bond” in the way that that term is used in the authorities cited to me by the Respondent.

8. During this meeting, the Respondent asked Mr Ryder and Mr Mulder what the Applicant’s relationship with CASA was like. One of the two replied to the Respondent that “we put up with CASA and CASA puts up with us”.

9. At this meeting, Mr Bredereck explained his vision for the Applicant going forward. He said to the Respondent that he hoped to expand the airline’s fleet to four planes within the next 12 months. The Respondent was also informed that the Applicant was aiming to commence RPT. The Respondent was told that he would receive a company American Express credit card. Some later time, the Respondent was told that the Applicant hoped to commence operations out of the Sunshine Coast airport.

10. After this meeting, an employment contract was sent via email to the Respondent.

The Employment Contract

1. The employment contract is dated 11 January 2013 and was signed and dated as accepted by the Respondent on 12 January 2013. That contract is Exhibit 27.

2. The significant matters to note are:-

   a)That there was a start date of 1 May 2013, or sooner subject to release from current employment and type rating training;

   b)The notice period was 8 weeks;

   c)The conditions included “completion of Embraer 145 type rating” and a note that “the type rating will be reimbursed to the employee over a 24 month period paid quarterly by the company”.

3. The Respondent deposes at paragraph 38 of his initial affidavit that upon receiving the employment contract he looked again at the website of the Applicant. He says that he saw the page which stated “CASA regulations dictate minimum certification standards for air transport operators. Jetgo Australia has implemented systems and standards that exceed these minimum requirements”.

4. The Respondent then resigned from Emirates. His employment with that airline required a 90 day notice period which would have expired on 10 April 2013. However, he had been booked to commence his type rating in St Louis on 1 April 2013 so by mutual agreement his employment was to cease with Emirates on 28 March 2013. That training was to be conducted by Flight Safety International in St Louis, Missouri.

The Part C Training and Checking Manual

1. After the acceptance of the employment contract, there were other interactions between the officers of the Applicant and the Respondent. Mr Ryder and Mr Mulder testified that part of the responsibilities of the HOTAC is that this person should be the author of the Part C Manual involving training and checking. They also testified that it is a CASA requirement that the person in the role of HOTAC be the person who has actually written this document. The Respondent disputes this and claims that he was asked to re-write this part of the manual because “it was a mess” and he had the necessary skills to do so. 

2. The Respondent, during a layover in Brisbane with Emirates, after he had signed the employment contract, was told of this requirement by Mr Mulder. Mr Mulder told the Respondent that as he would be the HOTAC he needed to fix up the manual. He told the Respondent that the manual “…needed a rewrite and I have told CASA this will be done.” The Respondent said that he was told that this needed to be done by the end of February 2013 and it would be good for his future with the company, however Mr Mulder denies this. I accept Mr Mulder’s evidence on this point.

3. The Respondent did complete the task of compiling this manual and he has exhibited this to his initial affidavit. He says that this took 100 hours of his own time.

The Training in St Louis and the ECC contract

1. In December 2012, Mr Ryder and Mr Mulder on the behalf of the Applicant entered into a lease agreement with ECC leasing company. This agreement was for the lease of an Embraer jet. Under this agreement, the Applicant had to pay a non-refundable initial cash deposit of $75,000.00. From then on the company would pay $75,000.00 a month for rental of the aircraft. This agreement is Exhibit 3 in the proceedings. The significant part of this agreement is clause 14 which reads:-

   “14. Support Package: ECC will, through Embraer or third parties, without any additional cost to the Buyer, offer a Support Package as listed below. If Buyer does not take advantage of any of the services provided below, no compensation or discount will be due by ECC under this Proposal.

   ·Training Familiarization

   ·Four (4) pilots be trained at an Embraer authorized Training Centre, including Ground School and Simulator.

   ·Technical Publications:

   ·Manuals: One (1) complete set of operational (hardcopy) and free access to the maintenance and operational manuals on FlyEmbraer website for a period of 2 yrs”

2. The arrangement between ECC and Flight Safety International is not known. However, it seems that the cost to ECC for training a pilot is considerably less than it would be for the Applicant or any other private citizen. I accept the evidence of Mr Ryder that such training for an individual is $39,600.00.

3. The Applicant had “up its sleeve” the ability to train four pilots because of the lease agreement. This was not a matter that the Applicant, through its officers, let be widely known.

4. The Respondent went to St Louis to commence his training on 1 April 2013. At that time, there had been no payment for this course. Mr Ryder gave evidence that he was contacted by Flight Safety International and told that there had been no payment for the training of the Respondent. Mr Ryder said that he caused an invoice to be sent to the Respondent for the sum of $39,600.00 for the training. The intention was for the Respondent to pay this money to the Applicant who would in turn pay Flight Safety International.

5. Mr Ryder said that he spoke to the Respondent who did not wish to pay for the training. Mr Ryder then came up with a plan that the Applicant would pay for the training and the Respondent would reimburse the Applicant by having quarterly deductions made from his wages. Mr Ryder testified that the Respondent agreed to this course.

6. The Respondent vehemently denies that this conversation occurred. He says that he approached Flight Safety International and asked for an invoice. He was told by administrative staff that ECC had paid for the training and there was no need for them to issue him with an invoice. The Respondent ignored the invoice sent to him by Mr Ryder.

7. What Mr Ryder actually did was to utilise one of the training spots provided by ECC through their support package.  This was done because of the need for immediacy of payment and to avoid any cash flow problems.

8. The Respondent testified that he later had a conversation with Mr Mulder who told him that the Applicant has an arrangement with ECC, whereby ECC pays for some of their pilot training. The Respondent testified that even though he knew that he was responsible for his training costs, he didn’t think again about the matter and thought that the issue of payment had been finalised.

9. The problem with Mr Ryder’s version is that he failed to get an acknowledgement of this arrangement in writing. It would have been very easy to have sent an email confirming the contents of the conversation. This would also have alerted the Respondent as to when such deductions were going to be made. It may also have allowed the Respondent to alter the payments system. It may have been better to have spread the repayments into 24 payments of a lesser amount rather than 8 payments of a sizeable amount so as to not affect the cash flow of the Respondent.

10. When this was put to Mr Ryder, his response was “more fool us for not putting it in writing”. If matters had occurred the way that Mr Ryder testified, it was obvious to me that Mr Ryder now realised the foolishness of his conduct.  Much criticism of Mr Ryder has been justifiably made by the Respondent, however, in my view, this criticism impinges on his competency and not his honesty.

11. Against this version of Mr Ryder is the improbability of the version of events presented by the Respondent. There is no doubt that the Applicant has sent the Respondent an invoice for $39,600.00. On his version, the Respondent does not question this invoice but simply ignores it.

12. While it does seem strange that an administrative officer of Flight Safety International would tell the Respondent that ECC had paid for the training, I cannot discount that this did not occur. However, the Respondent knew that he (the Respondent) was responsible for the cost of his training and did not query with the Applicant as to whether he needed to reimburse the company because of their arrangement with ECC.  It is also strange that the Respondent never mentioned the conversation he had with the administrative officer at FSI to either Mr Mulder or Mr Ryder.

13. On the version of the Respondent, the invoice that he received could well have been an invoice to cover any expenditure that the Applicant had made to ECC who had then covered the cost of the training. Yet the Respondent says that he did not raise this matter at all with Mr Ryder. I do not find this version credible.

14. It does not accord with common sense that the Respondent would have a conversation with Mr Mulder about ECC and not query whether the arrangement covered his own costs of training. This observation becomes even more stark when the events of 1 August 2013 are brought to bear.

The Commencement of Employment with Jetgo

1. During the time that the Respondent was being trained in St Louis, CASA conducted an audit of the Applicant. They issued 3 safety alerts, 19 non-compliance notices and 11 observations.

2. At one point during the training period, there was a Skype conversation between Mr Ryder, Mr Mulder and the Respondent. It is more probable than not, that it was during these conversations that the issue of the non-payment of training fees was raised. At no time during these conversations was the issue of the CASA audit raised with the Respondent.

3. It is not in dispute that during these conversations, Mr Mulder said that the Applicant would be employing the Respondent as the Head of Flight Operations (HOFO). (I note that the Award uses the term “chief pilot” to denote a HOFO.) There was a brief discussion to the effect that the Respondent would be paid more in this position.

4. The Respondent claims that Mr Mulder said that “I have a cunning plan to move you into my job so I can step back and help with the new business”. He also told the Respondent that “I am putting out spot fires with CASA, no big deal, I will see you when you are back”.

5. There is no dispute that the Respondent commenced his employment on 1 May 2013. The Respondent was able to demonstrate why he was a valuable acquisition for the company in a very short amount of time.

Incidents during Employment

1. Soon after the commencement of employment, the Respondent was involved in the company attending to the CASA audit.

2. The Applicant was tasked with certain duties in response to the CASA audit.  He was able to acquit the alerts and notices under his control to the satisfaction of CASA.

3. There has been much made of this audit. The officers of the Applicant have characterised the audit as a matter where the aviation watchdog was doing their job. Whilst any notice issued by CASA is serious, the Applicant contends that such is not symptomatic of an airline not fulfilling its obligations. The Applicant contends that such notices are handed out by the watchdog to airlines regularly. The Applicant contends that if there were any true concerns as to safety, CASA would have “closed them down”.

4. The Respondent, however, contends that these notices were contrary to what he had been told was the relationship between the Applicant and the regulatory authority. He testified that these notices were more than just “spot fires” and that the officers of the Applicant were seeking to minimise the true nature of this audit.  The Respondent contends that the audit illustrated the falsity of what was contained on the website of the Applicant.

5. I am not convinced that this audit was as serious as the Respondent is making out, but I am also not convinced that this audit was a matter that could be handled in a nonchalant or cavalier manner.

1. During the period of employment of the Respondent, there was concern raised by the Respondent as to the hours being worked by the pilots and crew. I accept that this discussion was somewhat protracted, but it was ultimately resolved to the satisfaction of the Respondent.

2. There was also an incident where a wing tip of one of the planes had some damage. The Respondent contends that this damage was more than superficial and was not reported to CASA at the appropriate time. The Respondent said that this concerned him greatly. The Applicant contends that the damage was superficial and was attended to appropriately by the safety engineers of the Applicant.

Change of Employment to HOFO

1. While there is nothing in writing to indicate any change, there seems to be no dispute that the Applicant was grooming the Respondent to become the Head of Flight Operations. This is in keeping with the conversations that had occurred prior to the Respondent commencing employment.

2. Mr Mulder wrote a letter for the Respondent to use in his discussions with the bank. In this letter the Respondent is described as Head of Flight Operations and his salary is said to be $150,000.00 a year.

3. From the pay records, it would seem that this took effect from 1 July 2013. Even though CASA had not given the tick of approval to the Respondent to be the HOTAC or HOFO, it appears as though the Applicant treated the Respondent as such and paid him accordingly.

July Training in St Louis

1. In order for the Applicant to employ the Respondent as HOTAC or HOFO, the Respondent needed to undergo more training under the eyes of an officer from CASA.

2. In July 2013, the Applicant made arrangements for the Respondent and another captain to be checked by CASA in St Louis. Also to be sent, were other officers that would be supervised by the Respondent while he was, in turn being supervised by CASA.

3. This training was a large undertaking by the Applicant but there were to be many benefits to this trip; not least of which would be the removal of any impediments to the Applicant formally making the Respondent their HOFO.

4. The Respondent left for St Louis in mid July 2013. There was quite some conjecture as to how the Respondent spent his time whilst in St Louis. There is no doubt that he completed the training that he was there to complete. From all accounts he acquitted himself very well in that training. But it is what else that the Respondent was doing at this time that was the subject of much of his evidence before me.

5. This was because the period from when the Respondent arrived in St Louis to when he resigned from the Applicant was very significant.

6. The Respondent said that he attended the training at Flight Safety International. There is no dispute about this. His first full day in St Louis was 18 July 2013. He said he completed the training and left St Louis on 22 July 2013. He arrived in Brisbane on 24 July 2013. He went to the offices of the Applicant on 26 July 2013. He then asked for personal leave and was given 29, 30 and 31 July as personal leave. He resigned on the morning of 1 August 2013.

7. The Respondent said that he worked for 12 hours on 18 July 2013. The Respondent was asked to go through what he did that day and he said that he spent 4 hours on the simulator, one hour preparation before the simulator and then one hour in debriefing. He said that he spent the remaining 6 hours working in his room. He believed those 6 hours of work occurred before he went to the training facility as the work he was doing that day was to prepare for what would occur at the training facility. He spent shorter periods doing work for the next 3 days and then flew back to Australia. He said he worked 10 hours on 26 July 2013 at the office of the Applicant.

8. The hours that were worked would become significant because the Respondent said that under the civil aviation orders, he cannot be rostered to fly if completion of the flight would result in him exceeding 90 hours of duty of any nature associated with his employment in a fortnight. The evidence the Respondent gave was that from 18 July to 26 July, he had worked 82 to 84 hours for the fortnight. Therefore, he contended that if he did any work in the period 27 July to 31 July, it would put him over the 90 hours.

9. Significantly, the Respondent failed to mention what else he did on 18 July 2013. Through a series of emails uncovered in the discovery and disclosure process, it emerged that the Respondent had been in contact with a company called Cambridge Communications Limited (CCL). This company is used by Boeing to recruit staff, predominantly pilots.

10. Exhibits 28, 30 and 31 detail the email exchange between CCL and the Respondent. The significant parts of these emails are reproduced precisely below (with typographical and grammatical errors, as well as discrepancies in the time recorded):-

    “From: CCL- FlightCrew <[email protected]>

    To: “[email protected]”<[email protected]>

    Sent: Wednesday, 10 July 2013 4:04PM

    Subject: Line Assist Positions

    Dear Andrew,

    I trust this email finds you well.

    We are pleased to inform you that Boeing would like to contact you regarding Line Assist positions.

    Prior to that contact we need to receive a completed Boeing COI form from you. Boeing are keen to be able to contact you as soon as possible so please do return this form as soon as you can.

    In addition this this we will need to know your availability over the coming weeks for an initial telephone interview. Please do provide your availability (preferably in Pacific Daylight Time) so Boeing can propose a suitable time to talk with you.

    Many thanks Andrew, we look forward to hearing from you.

    Kind Regards

    Ben Hopwood

    Cambridge Communications Limited

    Subject: Re: Line Assist Positions

    From: Andy Goodsall ([email protected])

    Date: Wednesday, 10 July 2013, 2:38

    Much appreciated Ben,

    Please find attached my completed COI form. Kindly advise Boeing I am available all day this coming saturday 13JULY. Perhaps if not too soon for Boeing, a suggested time might be 1300-1500PDT friday 12JULY equating to 0600-0900EST (Australia)saturday 13JULY. Beyond this, I will be travelling to the USA monday 15JULY to conduct simulator proficiency checks on some of our flight crew 17-21JULY inclusive with the following week free of duty. Therefore, I could extend my stay in the USA depending on their schedule.

    Thank you for sending me this great news, & hope to hear from you/Boeing soon.

    Kind Regards,

    Andrew Goodsall

From: Andy Goodsall [mailto:[email protected]]

Sent: 12 July 2013 04:24

To: CCL-FlightCrew

Subject: Boeing interview times – Andrew Goodsall

Morning Ben,

Trust you received the completed COI form as requested. If tomorrow 12JULY 1300-1500 PDT is un-suitable for Boeing to conduct the initial phone interview please be advised I will be travelling to St Louis, USA next tuesday 16JULY as previously mentioned.

Therefore, I have provided a schedule below of sim times, outside of which, I will make myself available a time to suit your Boeing team. Kindly note STL is 2 hrs ahead of SEA.

I will be in the simulator in St Louis the following times:

17JULY OFF

18JULY 2000-2400

19JULY 1600-2000

20JULY 1200-1600

21JULY 1600-2000

The following week monday 22JULY-25JULY I am rostered OFF so would be willing to extend my stay in the USA should Boeing wish to meet me in person.

Thank you once again for your consideration in this matter. I look forward to your reply.

Regards,

Andrew Goodsall

From: CCL- FlightCrew <[email protected]>

To: “[email protected]”<[email protected]>

Sent: Friday, 12 July 2013 6:12PM

Subject: Boeing interview times – Andrew Goodsall

Dear Andrew,

I trust your well.

After the interview phase is complete Boeing will usually move to arrange the SIM check. Given the tight timescale that Boeing are adopting for your interviews it seems prudent to gather the information they would normally ask for prior to the SIM check now.

I just need to confirm a few details with you, so we can provide Boeing with them prior to the SIM:

In particular your full legal name (please do confirm if you have any middle names, Boeing will need this should they arrange travel/accommodation etc).

Should Boeing not be able to arrange a SIM check whilst you are in the US they will need to know your preferred Port of trave in Australia to arrange travel for you.

If you have any contact numbers beyond those we have on file [H [phone]; W: [phone]] that would be more convenient for you, please confirm these as well.

Many thanks Andrew, I look forward to hearing from you.

Kind regards

Ben Hopwood

Cambridge Communications Ltd.

Subject: FW:Boeing interview times – Andrew Goodsall

From: CCL- FlightCrew ([email protected])

To: [email protected];

Date: Tuesday, 16 July 2013, 12:11

Dear Andrew,

I trust you are well and hope this email reaches you as I’m aware you are due to be travelling.

Please do confirm the appointment below is acceptable to you asap.

July 18^th at 11:00 PDT

Boeing are keen to be able to speak to you and if the appointment as it stands is not workable for you they are happy to provide alternative times when everyone can be available for the interview.

Please do get in touch as soon as you are able so we can feedback to Boeing.

Many thanks.

Kind Regards

Ben Hopwood

Cambridge Communications Limited

From: ‘Logan, Shea’ ,<[email protected]>

To:

‘[email protected]’ <[email protected]> Cc: Ben Hopwood <[email protected]>; “Logan,Shea <[email protected]>

Sent: Friday, 19 July 2013 6:17PM

Subject: Sim session

Good day, Andrew –

Please advise if you are available for a 777 sim session in Singapore with Carl on Tuesday, July 30^th, 2100-2300.

If so, please advise where you will be repositioning from and we will make travel and hotel accommodations.

Thank you!

Shea

Shea Logan

Staff Analyst-Pilot Services

206 661 3885~ Desk

206 304 7697 ~ Mobile

[email protected]

Subject:  Re:Sim session

From: Andy Goodsall ([email protected])

To: [email protected];

Cc: [email protected];

Date: Monday, 22 July 2013, 9:33

Thank you Shea,

Trust you enjoyed the weekend. I would be delighted to attend your Captain Car Davis’ simulator assessment SINGAPORE Tuesday 30JULY at our nominated times.

My travel preference is BNE-SIN-BNE. If I may request to depart BNE Monday 29JULY & return Wednesday 31JULY (unless you need me there longer). May I offer a travel preference with Etihad Airways as their schedule provides good arrival/departure times for this detail?

Please Shea, my friends call me Andy. Thanking you in advance.

Kind Regards

Andy”

1. What is clear from this exchange is that the Respondent was actively seeking employment with Boeing before he left for St Louis. There is nothing wrong with this in and of itself. The opportunity for a pilot to work with Boeing would be almost the pinnacle of a career. There can be no criticism of the ambition of the Respondent.

2. However a number of other details emerge:-

   a)the Respondent was interviewed on 18 July 2013; a fact he did not disclose when questioned by Counsel for the Applicant as to what he did that day;

   b)The Respondent committed himself to staying in St Louis for the week of 22 July 2013 to 25 July 2013 even though he could not be assured of being rostered off that week;

   c)The Respondent committed to being able to travel to Singapore on the 30 July 2013. He gave this commitment on 22 July 2013 without having yet approached Mr Mulder for any time off;

   d)The Respondent flew to Singapore on 29 July 2013, was interviewed on 30 July 2013 and flew back to Australia on 31 July 2013. These were the days that he had asked Mr Mulder to have off as personal leave.

The Termination of Employment

1. On 31 July 2013, the Applicant sent the Respondent his payslip for the month of July. From that payslip, it can be seen that the salary of the Respondent is now $150,000.00 a year. The payslip also discloses that the Applicant deducted a sum of $4,950.00. This sum was to represent a payment to the Applicant of the fees for the April 2013 training in St Louis.

2. According to the Respondent, he received email notification of the payment on 31 July 2013. This must have occurred after he arrived back from Singapore. The Respondent went to the offices of the Applicant on 1 August 2013 and gave his verbal resignation to Mr Mulder. He said that he also requested that the $4,950.00 be returned to him. He recounted that Mr Mulder said that the Respondent had “left him in the lurch” to which he replied that “you should have thought about that before you garnished $4950 from my salary for type rating costs. You have no right to garnish my wages; I never agreed to that. I can’t know if this will happen again. I will not be exposed to CASA for your illegal rostering”.

3. The Respondent said that he told Mr Mulder that “I have pressing family matters that need my attention. I wish JETGO all the best for the future”.

4. The Respondent said that he spoke to Mr Ryder via telephone later that morning and told Mr Ryder “you have no right to deduct from my salary; I have no such agreement with you”. The Respondent said that Mr Ryder replied “this was an administrative error and I’ll see what can be done.” The Respondent said that Mr Ryder then asked “what, no notice period?” And that the Respondent replied “no, Jason”.

5. The Respondent said that on 3 August 2013 he received a telephone call from Mr Ryder who said “I’ve repaid you the money. What are you going to say to CASA? Think of all the families that won’t have a roof over their head. I won’t give you a bad reference”. The Respondent said that he replied “Jason, if CASA asked me a question, I will tell them the truth”.

6. Mr Mulder’s account of this event, is that the Respondent had taken personal leave and had been non contactable for a four-day period. Mr Mulder says that upon the Respondent’s return, he came into Mr Mulder’s office and resigned on the spot. He told Mr Mulder this was because of family issues and that he needed to deal with those issues and could not do so if he were to take up a position with the company as HOFO. Mr Mulder said that he told the Respondent to take some time to think about it.

7. Mr Mulder said that the Respondent then changed his story and said that he could not work with Mr Ryder, the Chief Executive Officer. In cross examination, Mr Mulder said that he could not dispute that the Respondent said what he claims to have said in paragraph 64 and 65 above, though he has no recollection of the Respondent wishing JETGO all the best for the future.

8. Mr Ryder said that he was not at the office on the morning of 1 August 2013. He said that he had authorised the deduction of $4,950.00 from the Respondent’s salary pursuant to the agreement that he had with the Respondent over the costs of the type rating training. He said that he was surprised when the Respondent protested against this deduction.

9. Mr Ryder said that the Respondent in a conversation (presumably later that day) threatened to make an unfavourable report to CASA if he did not have the amount reinstated. Mr Ryder said that he took the threat seriously because the Respondent was friendly with a senior officer at CASA. Mr Ryder said that even though he had nothing to fear from such a complaint, the investigatory process can be very resource and time intensive. As a result of this, he instructed the payroll section to immediately reinstate that amount. The amount was reinstated on 2 August 2013.

10. Added to the recollections of the Respondent, Mr Mulder and Mr Ryder, are an email trail between the Respondent from CCL on 31 July 2013. These emails are Exhibit 32 and are reproduced below:

    “From: CCL- FlightCrew <[email protected]>

    To: “[email protected]”<[email protected]>

    Sent: Wednesday, 31 July 2013 4:17PM

    Subject: PSP Program – Success!!

    Dear Andrew,

    We have been notified by Boeing of your successful application for a Line Assist Position, congratulations!

    These positions are highly sought-after, and that you have been chosen from among many candidates is a great vindication of your skills and experience as a pilot. All of us at CCL are looking forward to working with you and to looking after your interests during your PSP duties with Boeing.

    We are currently working with Boeing to confirm your training and so your potential starting date.

    We are aware of a course currently available on 13^th September 2013 (contract start:1^st Sept). I appreciate this is somewhat short notice but if you are available to start at this time please confirm.

    If the above date is not suitable for you please provide as detailed a breakdown of your upcoming availability as you can (along with your preference for starting time) and we will work with Boeing to find a course best suited to you.

    Once we have confirmed your start date we will be able to issue you with a contract.

    We will also require you to provide all the necessary joining documents, this can be done now in preparation for your joining. Pleas log on to Connect ( where you will see a new section marked: “PSP Documents”. Please upload all the information requested in this section and submit the necessary forms for background checks to Verifications Inc.

    Should you have any questions at all regarding the documents required please do not hesitate to contact us.

    Congratulations once again Andrew, we look forward to hearing from you.

    Kind Regards

    Ben Hopwood

    Cambridge Communications Limited

    Subject: Re: PSP Program – Success!!

    From: Andy Goodsall ([email protected])

    To: [email protected];

    Cc: [email protected]

    Date: Wednesday, 31 July 2013, 3:42

    Ben,

    Many thanks for your teams’ professionalism & timely execution of my application for the Boeing PSP interviews. I cannot stress enough how thoroughly professional both your CCL & the Boeing company have been & feel privileged to be included within that team.

    I would be absolutely delighted to attend the course 13SEPT2013 with a contract start date of 01SEPT2013.

    I shall log into Connect & commence completing the prerequisite forms as soon as I return to Australia (overnight). Please forward the contract at your convenience.

    I also look forward to working with you & your team Ben.

    Thank you & best regards,

    Andy”

11. What can be seen from this email exchange is that the Respondent had already made the decision to leave the employ of the Applicant before he had been sent his payslip.

Repudiation of the Employment Contract

1. Notwithstanding that it is for the Applicant to prove that there has been a breach of the Modern Award, the logical way for me to decide this point is to look at whether or not the Applicant’s conduct amounted to a repudiation of the employment contract. The Respondent claimed that he resigned from the Applicant because of a series of matters of which the deduction from his salary was the “last straw”.

2. These other matters were:-

   a)not having received the AMEX credit card that he had been promised;

   b)no additional aircraft had been delivered to the Applicant during the time of the Respondent’s employment;

   c)Regular Public Transport flights had not occurred contrary to what the Respondent believed would happen after his meeting in January 2013;

   d)no application to CASA for either a “high-capacity” or “low capacity” airline licence was prepared during his employment;

   e)no operations commenced from the Sunshine Coast airport nor did the Respondent see any evidence of negotiations to that effect;

   f)the various “safety breaches” and Work practices that were in conflict with CASA regulations and guidelines.

3. The Respondent claims that all these matters add up to a repudiation of the employment contract he had with the Applicant. In resigning on 1 August 2013, the Respondent claims that he was merely accepting the Applicant’s repudiation of the contract they had with him.

4. I do not accept that the Applicant has in any way repudiated the employment contract.

1. I do not accept the Respondent’s account of how and why the events of 1 August 2013 unfolded. I find that it is inherently implausible that, if the deduction of this amount from his salary caused the Respondent the degree of indignation that he claims, he did not remind Mr Mulder of the conversation he had with Mr Mulder about the agreement with ECC.

2. One would have thought that this conversation would have been at the forefront of the Respondent’s mind, as this conversation justified to him, the reason why he did not have to pay for the training costs. The fact that it wasn’t mentioned illustrates to me both that the deduction played no part in the Respondent’s decision to resign immediately and that the conversation that the Respondent claims to have had with Mr Mulder about ECC simply did not happen.

Findings Concerning Repudiation

1. I find the Respondent knew that he was responsible for the costs of his Embraer type rating training. I find that, for whatever reason, he had refused to pay for that training. I find that this circumstance was reported to Mr Ryder. I find that because of the immediacy of payment being needed and to avoid cash flow problems, Mr Ryder utilised one of the training spots that the Applicant had pursuant to the ECC leasing agreement.

2. I find that there was an agreement for the Respondent to repay money to the Applicant. I will explore this issue later in these reasons.

3. I find that there were issues involving CASA regulations that were the subject of discussions between the Respondent and Mr Ryder and Mr Mulder. I will explore this issue later in these reasons. However, I do not accept that these issues played any part in the Respondent resigning as he did on 1 August 2013.

4. I accept the general gist of the evidence of Mr Mulder and Mr Ryder regarding their relationship with CASA. It is a fact of life in the aviation industry that adverse notices will be given by the regulatory authority. There is no airline in this country that has not attracted the adverse scrutiny of CASA at some time in their existence. The real issue is how the airline deals with this scrutiny. On the evidence before me, there is no reason to suggest that the Applicant was running anything other than an appropriately safe operation.

5. I find that the Respondent knew full well why the deduction had been made from his salary. I find that he had made an agreement for such deduction to occur.

6. I find that there was no reason for the Respondent to resign as he did other than the fact that he had obtained another job with Boeing.

7. Though not strictly necessary, I also make the following findings.

8. I find that the Respondent was thinking of himself rather than the Applicant when he made the arrangements, through CCL, to be interviewed by Boeing. I find that the Respondent was deceitful in asking for personal leave for the dates of 29, 30 and 31 July 2013. I find that the Respondent’s claim that he had worked over 82 hours from 18 July to 26 July is a contrivance to attempt to now justify his taking leave on the dates of 29, 30 and 31 July 2013. I find that there is nothing in the civil aviation orders that would have stopped him from working on those dates. I find that the civil aviation order only applies to rostering a pilot to fly after he has performed 90 hours of duty.

9. I find the Applicant had not repudiated the contract and that the Respondent did not ever believe that the Applicant had done so. I find that this claim of repudiation by the Respondent is a subterfuge to now justify his actions because of the Applicant’s initiation of these proceedings.

The Claim of the Applicant

1. The Applicant initiated these proceedings. Even though I have approached this matter by looking at the defence to the statement of claim first, it is for the Applicant to prove their case rather than the Respondent having to prove his defence.

2. There has been no dispute that the Respondent is covered by the Air Pilots Award 2010. A copy of the Award was provided and marked as Exhibit 21. That Award is a Modern Award. Pursuant to s.45 of the FW Act, a person must not contravene a term of a Modern Award.

3. Clause 12.7 (a) of the Award states:

   “A pilot with less than one year’s continuous service is required to give two weeks notice.”

4. As is obvious, the Respondent resigned immediately on 1 August 2013 and did not give two weeks’ notice. The Applicant claims that the Respondent thereby breached the Award. The Respondent claims that he was accepting the repudiation by the Applicant of the employment contract.

5. I have already found that the Applicant had not repudiated the employment contract.

6. Therefore I find that the Respondent has contravened a term of the Modern Award.

7. I declare pursuant to s.567(c) of the FW Act that the Respondent has contravened s.45 of the FW Act. The remedy for such a contravention is a pecuniary penalty. I will hear the parties on the nature and quantum of such a penalty.

Breach of Contract

1. The Applicant claims that the Respondent has breached the varied oral contract to repay the Applicant $39,600.00. I have already found that such an agreement did exist.

2. However the real question is whether such an agreement can be enforced. As I said earlier, the problem with this agreement is that it was not in writing and the terms were vague. It was an agreement made during a Skype call where the exact terms were never fully spelt out.

3. It seems to me that the only certain part of the agreement was that the Applicant would now pay for the costs of the training and that the Respondent would reimburse the Applicant.

4. Another problem with the agreement is that it allows the Applicant to profit from the changed arrangement. The original arrangement was that the Respondent would pay the Applicant $39,600.00 as per the invoice that is Exhibit JR-4 to Mr Ryder’s affidavit which is Exhibit 2 in these proceedings. The Applicant would pay this sum to Flight Safety International for the training of the Respondent. The Applicant would then reimburse the Respondent by 8 quarterly payments of $4,950.00. In this way the Respondent would be reimbursed in two years’ time.

5. The manner in which the agreement was altered reversed that position. It meant that the Applicant paid Flight Safety International for the training costs and that the Respondent instead reimbursed the Applicant for that outlay. Whilst Mr Ryder felt that this agreement worked out the same for everyone, this was not the case. For the reasons previously mentioned, the Applicant had to use one of their ECC funded training spots for the Respondent. There was no actual outlay by the Applicant. The best that can be done to quantify what the Applicant “paid” for the training is $21,000.00. The varied agreement would mean that the Applicant unfairly profited.

6. Because of these two aspects, I find that the agreement entered into by Mr Ryder and the Respondent in April 2013 regarding the training costs is not enforceable.

7. But that is not the end of the matter. As the Respondent conceded a number of times during his evidence before me, he was responsible for his training costs. He had contracted in his acceptance of employment to pay the costs of his training. That contract was still binding.

8. By not paying his training costs, the Respondent had breached the contract of employment. I make a finding that the Applicant has proved that the Respondent has breached his contract of employment.

What remedy is there?

1. The next task is to quantify the damages. I do not accept that the damages are $39,600.00 because that is not what the Applicant lost by the breach committed by the Respondent. What the Applicant has lost because of the breach of the contract by the Respondent, is the ability to choose, at a time convenient to them, any of their employees that they wish to receive training at Flight Safety International.

2. This is further complicated by the fact that the Applicant and the ECC have a number of agreements and a working relationship that has either of them in a positive or negative account with the other at any time. The lease agreement, under which the training of the Respondent was undertaken, was an agreement that was never fulfilled. As stated earlier, that agreement was for a $75,000.00 non-refundable initial payment and then for monthly payments of $75,000.00 upon delivery of Embraer aircraft. The training of four pilots was a bonus under the agreement.

3. That lease agreement was terminated, but not before the Applicant was able to take advantage of the bonuses offered to it by ECC. When that lease agreement was rescinded, the Applicant had already redeemed pilot training for 3 of its employees as well as other work. In document 3 of Exhibit 11, ECC has confirmed that it has quantified the value of the bonuses as being $95,800.00.

4. In other words, the Applicant received services valued at $95,800.00 for the non-refundable sum of $75,000.00. There seems to be no issue from ECC about this fact and Mr Ryder has treated it as part of the “swings and roundabouts” of the relationship the Applicant has with ECC.

5. While I accept the evidence of Mr Ryder that it would cost the Applicant (and any other private citizen) the sum of $39,600.00 to engage in type training at Flight Safety International, it is clear that the loss to the Applicant by the breach of the contract is considerably less than that sum. On the state of the evidence, it seems to me that the loss should be quantified at $21,000.00.

6. But I must consider the terms of the Air Pilots Award 2010 before I can proceed further.

The Air Pilots Award 2010

1. As previously mentioned, the Air Pilots Award 2010 was marked as Exhibit 21 in these proceedings. Many issues revolve around the interpretation of the Award and it is best that I work through these matters and then apply them to the matters that I have to consider.

2. A very relevant part of this Award is cl.2.2 which reads:-

   “2.2 The monetary obligations imposed on employers by this Award may be absorbed into overaward payments. Nothing in this Award requires an employer to maintain or increase any overaward payment.”

3. Arguments have been made that there have been breaches of this Award which have resulted in underpayments. It is the contention of the Applicant that the Respondent was paid well over the Award and that the allowances and other payments that would be made by the Applicant to the Respondent under this Award, have been absorbed into the overaward payment.

4. In cl.3.1, there are a number of definitions. Importantly in this matter are the following definitions:-

   “3.1 In this Award, unless the contrary intention appears:…

   airline operation means employers operating aircraft for the purposes of providing commercial scheduled passenger and freight air transport services in, and from a base in Australia, excluding regional airlines…

   check pilot means a pilot who is approved by CASA to conduct, and who does so conduct, flight proficiency test for the issue and renewal of pilots’ approvals, ratings, licences , and who certifies to the competency of pilots so tested…

   chief pilot means the pilot appointed by the employer and who is approved by CASA to perform the duties and responsibilities of the chief pilot…

   general aviation employer means an employer in the industry of operating aircraft for purposes other than providing commercial scheduled passenger and freight air transport services, including non-scheduled commercial air transport (private, business and instructional flying) in, and from a base in, Australia but not including aerial application operations or helicopter operations…

   regional airline means an employer operating aircraft for the primary purpose of transporting goods and passengers by scheduled commercial air services or charter by air to and/or from regional airports throughout Australia (including between regional airports and airports in capital cities)…

   standard rate means the minimum salary for a Captain single engine UTBNI 1360kg in Schedule B divided by 52…”

Was Jetgo a Regional Airline?

1. The first question to be asked is whether the Applicant is a regional airline. The word “airline” is not defined in the Award. The Respondent claims that before one can look at whether the Applicant was a regional airline, it must be shown that they were an airline. The Respondent points to the Civil Aviation Regulations which defined an “airline” as being “the operator of a regular public transport service”. There is no dispute that the Applicant was not an operator of a Regular Public Transport service at the time in question, and therefore could not have been an airline as defined in the Civil Aviation Regulations.

2. However, it is the definitions in the Award that I must be concerned about, rather than definitions contained in other sources. The fact is that the Award has defined “airline operation” and “regional airline”. It is my view that I must look at the definition of “regional airline” in the Award and decide whether the Applicant fits into that definition or not.

3. The Respondent submits that the operations of the Applicant at the time of his employment consisted solely of flights from Brisbane to Osborne mine and back, or to Townsville from Osborne mine and back. It is submitted that Osborne mine is not a regional airport and therefore providing charter services to Osborne mine could not be “charter by air to and/or from regional airports throughout Australia”.

4. The term “regional airport” is not defined. At Osborne mine, there is a landing strip and it is assumed, some form of structure where persons congregate before departure and after arrival. Does this mean that Osborne mine has no airport? On many islands within the Great Barrier Reef, access can only be made via seaplane. At these islands there is a floating platform that allows for the seaplane to have passengers embark and disembark even though transport to and from that floating platform is by boat. Does this mean that these islands do not have airports?

5. To my mind, anywhere a plane can regularly take off and land is sufficient for that place to be called an airport for the purposes of this Award. The differentiation here is that a regional airport is not an airport in a capital city.

6. Therefore in looking at the operations of the Applicant, I find that they are “an employer operating aircraft for the primary purpose of charter by air to and/or from regional airports throughout Australia (including between regional airports and airports in capital cities)”.

7. I find that the Applicant is a regional airline.

The Respondent’s Minimum Wage

1. There was much debate as to what the minimum wage a person in the Respondent’s position would receive under the Award. This was difficult because the aircraft, Embraer 135 or 145 was not mentioned in the Award. I assume that this is because no other company bound by the Award used Embraer jets before the Applicant.

2. It seems to me, because of the conclusion I have made that the Applicant is a regional airline, that Schedule C is the appropriate schedule to be looked at. However, there is no allowance made in Schedule C for a Captain of a jet plane. In looking at Schedule B (which involves airline operations or general aviation employers) there are allowances for Captains of jet planes.

3. The Respondent argues that the minimum salaries in Schedule B should be looked at in deciding what the Award wage for the Respondent should be.

4. This is a situation where the Award has not kept up to modern realities. When this Award was put together, the thought that a regional airline would use a jet was unrealistic. Before the Applicant began operations, it was industry wisdom that a regional airline could only be economically viable if it were to use a fleet of Turbo prop planes.

5. Schedule B of the Award has a mixture of Turbo prop and jet planes. There is quite a rise in minimum annual salary from a captain of a turboprop plane to a Captain of a jet plane. A Captain of a Dash 8 400 has a minimum salary of $66,725.00 whereas a captain of a small jet (Fokker 28 or CRJ-50) has a minimum salary of $107,401.00. This is in contrast to a Captain of a Dash 8 400 coming under Schedule C where the minimum salary is $80,925.00.

6. Apart from the Fokker 28 and the CRJ 50 (which have minimum salaries of $107,401.00), Schedule B mentions the BAe 146, the Fokker 100 B and the Boeing 717 (all having minimum salaries of $116,271.00). The schedule then mentions narrow body aircraft, wide body aircraft (single deck) and wide body aircraft (double deck).

7. The Respondent argues that because the Embraer 135 is not mentioned, the appropriate classification for it is a narrow body aircraft. Whilst the term “narrow body aircraft” is not defined, it seems that an aircraft with a single passenger aisle fits that definition. This is distinct from a “wide body aircraft” that has more than one passenger aisle.

8. Examples of a narrow body aircraft would be the Boeing 727 and 737 or the Airbus A320. Examples of a wide body aircraft (single deck) would be the Boeing 767 or the Airbus A330. Examples of a wide body aircraft (double deck) would be the Boeing 747 or the Airbus A380. Looking at the definitions section of the Award, it seems that Schedule B only contemplates jets being used by “airline operations” and not by “regional airlines”.

9. If this were a case of statutory interpretation, the Respondent would argue that, in finding what the minimum wage for a Captain of an Embraer 135 under Schedule B, the maxim Expressio Unius et Exclusio Alterius ought be the principle applied. The argument is that in specifically naming 5 jets in the Award and then generalising aircraft after that, the proper approach is that if the aircraft is not one of these 5 specific jets mentioned, it must then be part of the generalised description.

10. That approach does create somewhat of an absurdity. Aircraft such as the BAe 146 and the Boeing 717 are both bigger planes in weight and capacity than the Embraer 135. It is obvious in the framing of the minimum salaries that captains of jet planes are paid more than captains of turboprop aircraft. It is also obvious that the greater the weight and capacity of the plane, the greater the minimum wage. To interpret this Award as mandating that a captain of an Embraer 135 should have a greater minimum wage than the captain of a Boeing 717 is totally contrary to the framework of this Award.

11. If this were a case of statutory interpretation, the absurdity rule would be applied. Therefore it would be more in keeping with the intent of the Award to use the rule ejusdem generis. Using this rule would see the Embraer 135 in the same category of jet as the Fokker 28 and the CRJ 50. The Embraer 135 has a capacity of 37 people so it sits between these two other planes.

12. Of course, this would only apply if Schedule B were the proper schedule. As I have found that the Applicant is a regional airline, it is my view that Schedule C is the appropriate schedule. The maximum wage for a Captain of a regional airline under the Award is $80,925.00.  The Respondent was paid well over this amount. This disposes of any claim that the Respondent was underpaid.

13. Even though I have found that Schedule B does not apply, I will still go through the exercise as if I had to determine what the minimum wage for the Respondent was under the Award.  As Schedule C does not contemplate the use of a jet, I should look to Schedule B as a guide to what might be the appropriate minimum wage for a Captain of an Embraer 135.

14. In my view, the hypothetical minimum wage for the Respondent under this Award would be $107,401.00 using the finding I have made in paragraph 131 above. The Respondent was paid at a rate of $120,000.00 per annum for the first two months of his employment and $150,000.00 per annum for the last month of his employment.

15. The Respondent has claimed, in his cross-claim, that there has been an underpayment of wages. That claim is based on his having a minimum wage of $121,894.00, which is the minimum wage of captain of a narrow body aircraft. With the addition of a number of allowances, the Respondent claims that he should have had a minimum wage of $145,591.31.

1. The Award has an addition to the minimum salary. It states that a pilot (excluding Fokker 28 pilots) required to hold a senior commercial pilot’s licence will be paid 604% of the standard rate per annum. It also states that a pilot (excluding Fokker 28 pilots) flying a turbo jet aircraft will be paid 1280% of the standard rate per annum. It further states that a pilot (excluding Fokker 28 pilots who are required to carry out flying using an instrument rating will be paid an additional allowance (in the case of the Respondent) 732% of the standard rate per annum.

2. The Award also gives allowance for a check pilot (with 10 pilots or less) a further 7% allowance of the minimum wage.

3. Using the definition of standard rate, my calculations have the standard rate equalling $746.54 ($38,820.00 divided by 52). Using the definition of check pilot in the Award, it can be seen that the Respondent does not fit this category because he was not approved by CASA.

4. On my calculations, the minimum wage would have been $107,401.00 plus $4,509.10 plus $9,555.71 plus $5,464.67 giving a total of $126,930.48. If one divides this sum by four (because the Respondent worked for the Applicant for three months) the total that the Respondent should have been paid is $31,732.62. The Respondent was paid a total of $32,500.00 by the Applicant.

5. If I accepted the argument of the Respondent that the calculation of minimum wage should be done by utilising Schedule B (which I have not accepted), I would nevertheless find that the Respondent was paid more than what he was entitled to be paid under the Award and that the principles in the cl.2.2 of the Award have been observed.

Clause 19 of the Award

1. The Respondent makes a further claim for allowances pursuant to cl.19 of the Award. This claim concerns the travel to St Louis in July.

2. However, cl.19 is very clear that this clause does not apply to pilots employed by regional airlines. As I have found that the Applicant is a regional airline, any claim by the Respondent against the Applicant pursuant to this clause cannot be successful.  Therefore I dismiss any claim made relying upon this clause of the Award.

The Part C Manual

1. The Respondent claims that the writing of the manual that he completed before he commenced employment is an undertaking for which he should be paid. He said that he spent 100 hours of his own time writing this section.

2. In my view, this was part of the tasks that he was undertaking in his role with the Applicant. It was not something extra that he did. I do not accept that the Respondent was told by Mr Mulder that such a task needed to be done before the Respondent commenced employment. I find it far more likely that this task was undertaken by the Respondent to illustrate his value to the Applicant.

3. There was no reason why this task could not have been undertaken after 1 May 2013. I do note, that even at the time of the resignation of the Respondent, the manual that the Respondent had written had not been given the “tick of approval” by CASA.

4. I dismiss the claim by the Respondent for monies owed for completing this task.

Superannuation

1. There has been an admission by the Applicant that they did not pay the appropriate amount of superannuation. They have since paid that sum and, because of the failure to pay that sum at the proper time, the Applicant has suffered a penalty imposed by the Australian Taxation Office.

2. Nevertheless, there has still been a breach of the Award and of the National Employment Standards. I find that the Applicant has breached s.45 of the FW Act in not paying superannuation.

Annual Leave

1. Similarly, the Applicant has conceded that there was a failure to pay the Respondent his accrued annual leave. The Applicant concedes that the Respondent had accrued 5.041 days of annual leave pursuant to cl.24 of the Award.

2. This sum has not been paid. The Applicant submits that there should be allowance taken for three days of personal leave which was taken illegitimately. I have earlier found that these three days were taken by way of deceit. They should be taken as annual leave.

3. I therefore find that the Respondent has accrued 2.041 days of annual leave and that the Respondent must pay the sum that is still to be calculated. I find that the Applicant breached cl.24 of the Award and has therefore contravened s.45 of the FW Act.

Was the Deduction of Pay a Breach of the Act?

1. The Respondent claims that the deduction from his pay by the Applicant was a contravention of s.323(1)(a) of the FW Act. For the reasons that I have previously mentioned, I find that this deduction was the result of an agreement between the Applicant and the Respondent.

2. I therefore find that there was no breach of the FW Act.

Training Costs

1. The issue of training costs requires me to interpret clause 16 of the Award. Clause 16 states:-

   16. Training – classifications

   16.1 This clause does not apply to employees engaged in aerial application operations.

   16.2 Where the employer requires a pilot reach and maintain minimum qualifications for a particular aircraft type in accordance with this Award, all facilities and other costs associated with attaining and maintaining those qualifications will be the responsibility of the employer.

   16.3 Where a pilot fails to reach or maintain a standard required the pilot will receive further re-training and a subsequent check. The pilot may be elect to have a different check captain on the second occasion.

   16.4 Where a pilot fails the second check in clause 16.3, the pilot may, where practicable, be reclassified to the previous or a mutually agreed equivalent position.

   16.5 Where employment commences under this Award the pilot’s service required to be undertaken by the prospective employer, prior to commencing employment, during training period will be recognised and any training required to be conducted at the employee’s cost will be reimbursed to the pilot.”

2. I have already found that the Respondent has breached his employment contract by not paying for his training costs incurred in April 2013. The Respondent argues that the damages for such a breach should be nominal at best. This is based on a reliance on cl.16.5.

3. I see no problem with the employment contract and cl.16.5 standing together. The employment contract seems to recognise what is contained in cl.16.5.

4. The Applicant required the Respondent to have his type rating before employment could commence. The Applicant did recognise this period and was to reimburse to the Respondent the cost of that training. This was to be done over a period of two years whilst the Respondent remained in the employ of the Applicant.

5. The Respondent argues that two years have now passed and so the Applicant is in no worse position at this point, than if the Respondent had honoured his contract. That submission fails to take into consideration that the Applicant would have had the advantage of the services of the Respondent for those two years. It was not disputed that the Respondent was a very valuable employee and, with him on board, the Applicant would have grown far quicker than it has without him.

6. Clause 16.5 does not set any time limit for the reimbursement of those costs. Training costs are not expense claims and thus cl.20.1 of the Award offers no assistance to the Respondent.

7. Therefore, I find that cl.16.5 has no effect on the Respondent’s liability for his breach of the employment contract in not paying for his training costs.

8. Alternatively, the Respondent submits that cl.16.2 would affect his liability for the breach. I do not accept this submission.

9. Firstly, cl.16.2 only applies to persons who are already in the employ of the employer and must submit to further training; for an example, if they were to be the pilot for a different type of plane. The Respondent was not an employee of the Applicant until 1May 2013 which post-dated the training.

10. Secondly, the clause only speaks of a pilot reaching and maintaining minimum qualifications for a particular aircraft type in accordance with this Award. As has been well and truly noted, the Embraer 135 and 145 are not mentioned in the Award. Therefore this clause cannot apply to the Respondent.

11. The Applicant submits that cl.16 has no effect. The submission is that the clauses are not terms that are permitted or required by any of the subsections in s.136 of the FW Act. The submission is that a Modern Award may include terms that it is permitted to include only to the extent necessary to achieve the Modern Awards objective and the minimum wages objective under s.139(1) of the FW Act.

12. The submission is that training is not part of those objectives and therefore cl.16 is unenforceable. The Respondent counters this argument by saying, in effect; regular (and expensive) training is needed for pilots to properly perform their tasks and thus fall under s.139(1)(g)(i) and (ii). Therefore the FW Act would permit training in such a field to be part of the Award because, unlike the vast majority of other professions and occupations, the training is intrinsically linked to the performance of the role.

13. In my view, cl.16 is valid and the Applicant and Respondent are bound by those clauses. However, a strict reading of the clauses is needed and that is what I have done in applying the Award to these facts. That strict reading, in my view, does not assist the Respondent for the reasons I have previously outlined.

14. Even if I am wrong in these conclusions about the effect of the Award, I would find that the Applicant received no consideration of the outlay they made on behalf of the Respondent and that it would be unjust for the Respondent to retain the benefit of this training at the expense of the Applicant.

The July St Louis costs

1. The Applicant claims restitution of costs associated with the July trip to St Louis undertaken by the Respondent. The Applicant contends that they received no benefit for the following items of expenditure:-

   a)the sum of money paid to CASA for check pilot approvals;

   b)the sum paid to Flight Safety International in respect of the briefing and operation of the simulator; and

   c)the sum paid for the Respondent’s simulator training.

2. It emerged during the trial that the Applicant had initially believed that they had paid for the travel and accommodation costs of the Respondent as well as the training costs. It became clear that the Respondent had paid for his own travel and accommodation.

3. The Respondent, in his counterclaim, asks this Court to order that the sum of $4,834.52 for travel and $3,633.96 for accommodation expenses be paid to him by the Applicant.

4. The Respondent also claims that, in not paying these sums, the Applicant is in breach of cl.16.2 and therefore asks this Court to declare that the Applicant has breached s.45 of the FW Act.

5. The Applicant had some trouble in quantifying the consideration that it expended solely for the Respondent. This is because there was another pilot that was assessed by the CASA regulator and a number of other pilots who were assessed by the Respondent and that other pilot under the supervision of the CASA regulator. So while the Applicant received no benefit for the money it expended for the Respondent, it received a benefit through all of the other monies expended for this trip.

6. Added to this is the confusion as to what was actually paid. Exhibit 34 suggested that the sum originally thought to be paid of $10,800.00 may well have been discounted. However, it is clear that $10,800.00 was paid to Flight Safety International.

7. I cannot accept that the $10,800.00 was solely for the training of the Respondent. It would seem to me that, at best for the Applicant, that half of that cost might well have been because of the training of the Respondent. The Applicant paid $7,950.00 for the CASA supervision and approvals but only half of that sum is attributable to the Respondent. It seems that the Applicant paid $2,400.00 for the Respondent’s simulator training.

8. On my calculations, the Applicant claims that they received no benefit from the expenditure of $11,775.00 in respect of the training of the Respondent.

9. What has occurred is expenditure by the Applicant for a purpose that was necessary for the advancement of the business. What occurred in the Respondent not giving the notice required under the Award (and indeed nowhere near the notice required in the contract of employment) exacerbates the contravention of s.45 of the FW Act.

10. The remedy for a contravention of the Act is a pecuniary penalty which can be paid to a person if the Court is of the view that it is appropriate to do so. It is trite to say that what the Applicant desired from the expenditure of this money was that the Respondent would utilise that training to enhance the company and train the more junior pilots.

11. With this training now under his belt, there was no real impediment for the Applicant to become the HOTAC and the HOFO. I accept that the sudden resignation of the Respondent set back the operations of the Applicant significantly.

12. The Respondent submits that these training costs were payable by the Applicant in any event. The Respondent relies on cl.16.2 which, as previously discussed, imposes upon the employer the need to meet the costs of training of this type. The Respondent submits that even if the Embraer training is not for an aircraft within the Award, the spirit of this Award would dictate that the employee can be no worse off.

13. But this is not the gravamen of the claim by the Applicant. The Applicant recognises that it is responsible for the costs of training, even if that is not by reason of the operation of cl.16.2. The Applicant would be pleased to pay those costs for the betterment of the business.

14. What the Applicant says is that, notwithstanding the fact that it is responsible for the payment of that training, the Respondent’s behaviour in resigning as, and when, he did, means that they received no consideration for the monies that they had to expend.

15. It is the fact that there was no consideration for the payments that it made, that caused the Applicant to seek relief in this Court. The claim of the Applicant is that it is unjust for the Respondent to retain the benefit of this training at the Applicant’s expense.

16. In the circumstances of this case, I agree that it would be unjust for the Respondent to retain the benefit of this training at the Applicant’s expense. Therefore, I will order, in relation to this aspect of the claim, that the Respondent shall pay the Applicant $11,775.00 with interest.

17. I do not find that the Applicant has breached cl.16.2 by not paying the travel expenses of the Applicant. I note that it was his desire to travel business class that caused the Respondent to pay for the airfares and that the Respondent has claimed these expenses as a tax deduction.

18. I find that there had been discussion between the Applicant and Mr Mulder as to some form of reimbursement for this travel. This discussion would have continued had it not being for the sudden resignation of the Applicant. I find that there had been no deliberate action by the Applicant not to pay these expenses before the resignation.

19. If the Applicant had paid those travel expenses before the resignation, such costs would have been part of the award that I would have ordered that the Respondent now pay to the Applicant.

20. I dismiss the Respondent’s counterclaim in this respect for the reimbursement of those travelling expenses.

Was there a Breach of Australian Consumer Law?

1. The Respondent, in his counterclaim, contends that there was a breach of Australian Consumer Law. The Respondent points to representations that were made to him that he claims were misleading or deceptive. These are:-

   “i. the cross-respondent did not take immediate steps to appoint the cross-applicant to the position of HOFO or Chief Operating Officer upon commencement of employment;

   ii. the cross-respondent did not, during the course of the cross-applicant’s employment, commence operating in RPT;

   iii. the cross-respondent did not, during the course of the cross-applicant’s employment, commence flying out of the Sunshine Coast;

   iv. the cross-respondent did not advise the cross-applicant in a timely manner the findings made by CASA as a result of the April 2013 audit;

   v. the cross-respondent was non-complaint with the regulatory and statutory requirements of CASA in major ways;

   vi. the cross-respondent did not take delivery of additional aircraft;

   vii. the cross-respondent did not provide the cross-applicant with an AMEX card.”

2. Taking these claims seriatim, I find as following:

   a)The Applicant could not make the Respondent the HOFO until he had the “tick of approval” by CASA. That could not be done until the July training had concluded. This was not deceptive conduct by the Applicant;

   b)The Applicant did not commence RPT operations during the course of the Respondent’s three-month employment, however this was not misleading or deceptive. There was no time frame put on the commencement of such operations and it could not have been of any surprise to the Respondent that this had not commenced before August 2013;

   c)The same finding is made in relation to the aspiration to fly out of the Sunshine Coast;

   d)The Applicant advised the Respondent of the audit by CASA soon after he commenced employment. He became part of the acquitting of these notices. I do not see that there was anything misleading in not informing the Respondent of this audit before he commenced employment;

   e)I have already commented on the relationship between the Applicant and CASA. I do not find that there is anything misleading or deceptive about how the Applicant described that relationship to the Respondent;

   f)Whilst the Applicant did not take delivery of additional aircraft in the 3 months in which the Respondent was employed by them, there was no promise that this would happen. I do not find anything misleading or deceptive in this claim;

   g)Whether or not the Respondent was supplied with an AMEX card was not a deal maker in any way, shape or form. The Respondent himself did not ever mention this after he began employment.

3. I do not find that these matters played any great part in the Respondent deciding to sign the Contract of Employment. I do not find that the Applicant has been deceptive or misleading. I do not find that there has been any contravention of Australian Consumer Law.

4. Even if the Respondent had relied upon any of the representations and those representations had been misleading, I do not find that the Respondent suffered any loss.

Conclusion

1. I make the following orders.

2. I declare that the Respondent has contravened s.45 of the Fair Work act in not giving two weeks’ notice and is liable to a pecuniary penalty.

3. I declare that the Respondent has breached the Contract of Employment .

4. I order that the Respondent pay the Applicant $21,000.00 plus interest for the breach of contract relating to the above order.

5. I declare that the Applicant is entitled to restitution on the basis that the consideration paid for the July 2013 training wholly failed in circumstances where it would be unjust for the Respondent to retain the benefit at the expense of the Applicant.

6. I order that the Respondent pay to the Applicant the sum of $11,775.00 plus interest as restitution relating to the above order.

7. I order that the cross-claim for a declaration that the Applicant contravened the FW Act in relation to the deductions from pay be dismissed.

8. I order that the cross-claim for a declaration that the Applicant contravened the FW Act in relation to underpayments be dismissed.

9. I order that the cross-claim for a declaration that the Applicant contravened the FW Act in relation to training costs be dismissed.

10. I declare that the Applicant has contravened s.45 of the FW Act in that it failed to pay superannuation at the time that it was due and is liable to a pecuniary penalty.

11. I declare that the Applicant has contravened s.45 of the FW Act in that it failed to pay accrued annual leave annual leave upon the resignation of the Respondent and is liable to a pecuniary penalty.

1. I order that the Applicant pay the Respondent the sum equivalent to 2.0146 days of annual leave with interest.

2. I dismiss the cross claim for contravention of Australian Consumer Law.

3. I dismiss the cross-claim for breach of contract.

4. I will hear the parties in relation to the issues of costs and of pecuniary penalty arising from the orders contained in paragraphs 193, 201 and 202 above.

I certify that the preceding two hundred and six (206) paragraphs are a true copy of the reasons for judgment of Judge Vasta

Date: 28 May 2015