Joel Tobin v Ferrymen (Port Macquarie) Pty Ltd

[2023] FWC 729

[2023] FWC 729

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.394—Unfair dismissal

Joel Tobin
v

Ferrymen (Port Macquarie) Pty Ltd

(U2023/673)

COMMISSIONER MCKINNON SYDNEY, 27 MARCH 2023

Application for an unfair dismissal remedy – minimum employment period – whether transfer of business – no “arrangement between” old employer and new employer – no transfer of employment – application dismissed.

1. Mr Joel Tobin worked for Ferrymen (Port Macquarie) Pty Ltd (Ferrymen) from 16 July 2022 until 6 January 2023, when he was notified of his dismissal. On 27 January 2023, he applied for an unfair dismissal remedy under section 394 of the Fair Work Act 2009 (the Act).

1. Ferrymen says Mr Tobin is not protected from unfair dismissal because he did not complete the minimum employment period of 6 months with Ferrymen.[1] The objection arises in the context of Ferrymen having taken over the provision of vehicular ferry operations services in the North Region of New South Wales (NSW) on behalf of Transport for New South Wales (Roads and Maritime Services). Mr Tobin was formerly employed in substantially the same role by TONO Ferries, which lost the contract to Ferrymen.

1. Mr Tobin says his prior service with TONO Ferries counts as service with Ferrymen and he is eligible to make an unfair dismissal application.

1. The question is whether Mr Tobin has completed the minimum employment period such that he is protected from unfair dismissal.

Minimum employment period

1. Section 382 of the Act provides that a person is protected from unfair dismissal if, at the relevant time:

·   they have completed at least the minimum employment period; and

·   they are either covered by a modern award, employed under an enterprise agreement that applies to them or earn an annual income of less than the “high income threshold”.

1. Mr Tobin was covered by a modern award in relation to his employment with Ferrymen and his annual income was less than the high income threshold.

1. Section 383 defines “minimum employment period”. As Ferrymen is not a small business employer, the relevant minimum employment period is 6 months ending at the earlier of the time of notice of dismissal or immediately before the dismissal. In this instance, the two are one and the same – Mr Tobin was dismissed with immediate effect on 6 January 2023.

1. Section 384 defines “period of employment”. An employee’s period of employment with an employer at a particular time is the period of continuous service they have completed with their employer at that time in their capacity as an employee. Where there is a transfer of employment, a period of service with a different employer can also count as service with the later employer.[2] The circumstances in which that can occur are set out in section 22(7).

1. Section 22 deals with the meanings of “service” and “continuous service”. A period of service is a period during which a national system employee is employed by their national system employer. Ferrymen (which is a trading corporation) is a national system employer, and Mr Tobin was its national system employee.

1. It is convenient to set section 22(7) out in full:

“(7)There is a transfer of employment of a national system employee from one national system employer (the first employer) to another national system employer (the second employer) if:

(a)       the following conditions are satisfied:

(i)the employee becomes employed by the second employer not more than 3 months after the termination of the employee's employment with the first employer;

(ii)the first employer and the second employer are associated entities when the employee becomes employed by the second employer; or

(b)       the following conditions are satisfied:

(i)the employee is a transferring employee in relation to a transfer of business from the first employer to the second employer;

(ii)the first employer and the second employer are not associated entities when the employee becomes employed by the second employer.

Note: Paragraph (a) applies whether or not there is a transfer of business from the first employer to the second employer.

1. There is no dispute that Mr Tobin became employed by Ferrymen on 16 July 2023, immediately upon the cessation of his employment with TONO Ferries. There is, however, no evidence that TONO Ferries and Ferrymen ever were, or are, associated entities. Instead, they are competitors for the provision of ferry services. I find that TONO Ferries and Ferrymen are not associated entities. Accordingly, the conditions in section 22(7)(a) of the Act are not satisfied in relation to Mr Tobin and there was no transfer of employment between associated entities.

1. Section 22(7)(b) deals with a transfer of employment between non-associated entities. In this case, the conditions of section 22(7)(b) will be satisfied if Mr Tobin was a transferring employee in relation to a transfer of business from TONO Ferries to Ferrymen.

1. Transfer of business is dealt with in Part 2-8 of the Act, and the circumstances in which a transfer of business occurs for the purposes of the Act are set out in section 311. For there to be a transfer of business, there must be a connection of the kind prescribed in section 311(3)-(6). Sections 311(4)-(6) are not relevant because there is no evidence of any current or former outsourcing arrangement between Ferrymen and TONO Ferries, and the two are not associated entities.

1. Section 311(3) is relevant, however. It deals with what is known as the ‘transfer of assets’ connection. Section 311(3) provides:

(3)There is a connection between the old employer and the new employer if, in accordance with an arrangement between:

(a)the old employer or an associated entity of the old employer; and

(b)the new employer or an associated entity of the new employer;

the new employer, or the associated entity of the new employer, owns or has the beneficial use of some or all of the assets (whether tangible or intangible):

(c)that the old employer, or the associated entity of the old employer, owned or had the beneficial use of; and

(d)      that relate to, or are used in connection with, the transferring work.

1. In short, there will have been a transfer of business from TONO Ferries to Ferrymen in relation to Mr Tobin, and there will be a “transfer of employment” such that he will be a “transferring employee”, if:

1. Mr Tobin’s employment with TONO Ferries was terminated,

2. Within 3 months after the termination, Mr Tobin became employed by Ferrymen,

3. The work Mr Tobin performed for Ferrymen was the same, or substantially the same, as the work he performed for TONO Ferries, and

4. There is a ‘transfer of assets’ connection between TONO Ferries and Ferrymen.

1. As noted above, the first three of these are established. Mr Tobin’s employment with TONO Ferries was terminated and he immediately became employed by Ferrymen. The work Mr Tobin performed for the two entities was substantially the same. The question is whether there is a ‘transfer of assets’ connection between TONO Ferries and Ferrymen.

1. The evidence establishes that Ferrymen has the same beneficial use of assets (specifically, site amenities and vehicular ferries) as previously enjoyed by TONO Ferries, including at Lawrence and Ulmarra, where Mr Tobin worked. These are assets owned by Transport for NSW that are made available under contract for the purpose of the contractor providing vehicular ferry operations services on its behalf. However, there is no evidence of any arrangement between TONO Ferries and Ferrymen, or any understanding or plan, from which this beneficial use arose. There is no evidence that either TONO Ferries or Ferrymen assumed any form of obligation, or gave any assurance or undertaking that it would act in a certain way, to the other.[3] There is no evidence of any obligation on the part of Ferrymen to take on the employees of TONO Ferries, although plainly it did so in relation to Mr Tobin. This came about through a meeting in a nearby park to which workers of TONO Ferries were invited to come along, given job applications and told to apply “ASAP” as it was “first in, best dressed”. In other words, there was no guarantee of employment.

1. If anything, the evidence points the other way, to the entire absence of any undertaking, arrangement or even communication between TONO Ferries and Ferrymen. This is explained in part by tender probity rules that are said to have precluded any discussion among parties tendering for the ferry services contract. The exception was a single telephone call from TONO Ferries to Ferrymen to confirm the time of contract changeover on the date Ferrymen’s contract commenced, apparently at the urging of Transport for NSW.

1. Instead, the arrangements underpinning the transfer of assets from TONO Ferries to Ferrymen were separate arrangements between TONO Ferries and Transport for NSW on the one hand, and Ferrymen and Transport for NSW on the other. TONO Ferries removed its own assets from relevant sites and ferries at the completion of its contract. Ferrymen then brought to those sites and ferries whatever of its own assets it saw as necessary to provide the contracted services.

1. For these reasons, I find no transfer of assets connection between TONO Ferries and Ferrymen. While Ferrymen has the use of the same site amenities and ferries previously used by TONO Ferries, and these are used in connection with the work that Mr Tobin performed, this is the result of an arrangement between Ferrymen and Transport for NSW. There is and was no “arrangement between” TONO Ferries and Ferrymen in accordance with which the beneficial use of assets was transferred from one to the other.

1. The consequence of this finding is that there was no transfer of business from TONO Ferries to Ferrymen, and no transfer of employment. Mr Tobin was not a transferring employee in relation to a transfer of business from TONO Ferries to Ferrymen. His service as an employee of TONO Ferries does not count as service with Ferrymen.

1. Returning to the question of whether Mr Tobin has completed the minimum employment period, I find that Mr Tobin’s employment commenced on 16 July 2022 as a casual employee employed on a regular and systematic basis and with a reasonable expectation of continuing employment on this basis (subject to the satisfactory completion of a 3-month probationary period). Mr Tobin became a full-time employee of Ferrymen on 15 August 2022 and his employment ended on 6 January 2023. Mr Tobin’s total period of continuous service as an employee of Ferrymen was 5 months and 3 weeks. This is less than the minimum employment period of 6 months.

1. Mr Tobin has not completed the minimum employment period as an employee of Ferrymen.

No decision not to recognise service

1. Mr Tobin submits that the case turns on whether Ferrymen gave him written notice that it would not recognise his prior service with TONO Ferries. I infer that the submission is about the exceptions in sections 91(1) and 122(1) of the Act in relation to recognition of prior service for the purposes of annual leave, and redundancy, respectively.

1. I accept Mr Tobin’s submission that there is no evidence of any decision by Ferrymen “not to recognise” the service of Mr Tobin with TONO Ferries. However, the capacity to make this decision is only relevant in circumstances of a transfer of employment. For the reasons above, there was no transfer of employment from TONO Ferries to Ferrymen in relation to Mr Tobin.

Conclusion and disposition

1. The result is that Mr Tobin is not a person protected from unfair dismissal. He is not eligible to apply for an unfair dismissal remedy.

1. The application is dismissed.

COMMISSIONER

Appearances:

J Tobin on his own behalf

W Eades for the respondent

Hearing details:

2023.
Sydney (by Video).
March 23.

[1] Fair Work Act 2009 (Cth), s.382-3

[2] Fair Work Act 2009 (Cth), s.22(5)

[3]

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