Joseph Peter Atkinson v Brickshaw Pty Ltd
[1995] IRCA 113
•27 March 1995
CATCHWORDS
INDUSTRIAL LAW - Termination of employment - Claim of unlawful termination -
Contract of service or contract for services - Employer a sub-contractor and applicant an employee - Employee dismissed for lodging Work Cover claim - Termination not for a valid reason and harsh, unjust and unreasonable - Termination a breach of S170DB, S170DC, S170DE (and contrary to the spirit of S170DF(1)(a).
Industrial Relations Act 1988, S170DB, DC, DE, DF and EE.
Humberstone v Northern Timber Mills [1949] 79 CLR 389
Stevens v Brodribb Sawmilling Company Pty Limited [1985-86] 160 CLR 16
JOSEPH PETER ATKINSON v BRICKSHAW PTY LTD
No. VI-963/94
Before: Ryan JR
Place: Melbourne
Date: 27 March 1995
IN THE INDUSTRIAL RELATIONS
COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY Matter No VI-963/94
B E T W E E N: JOSEPH PETER ATKINSON
Applicant
AND:BRICKSHAW PTY LTD
Respondent
RYAN JR
MINUTES OF ORDER
27 MARCH 1995
THE COURT ORDERS THAT:
The respondent pay to the applicant compensation in the sum of $4,000.
The Registrar draw up, sign and seal an order to that effect.
NOTE: Settlement and entry of orders is dealt with in Order 36 of the Industrial Relations Court Rules.
IN THE INDUSTRIAL RELATIONS
COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY Matter No VI-963/94
B E T W E E N: JOSEPH PETER ATKINSON
Applicant
AND: BRICKSHAW PTY LTD
Respondent
COURT: RYAN JR
PLACE: MELBOURNE
DATE: 27 MARCH 1995
REASONS FOR JUDGMENT
THE CLAIM
The applicant seeks compensation for unlawful termination of employment. The application was filed on 8 July 1994 naming M Brickshaw & Co Pty Ltd as respondent. The applicant served the application on Michael Shaw on 18 August. Shaw conceded in an affidavit on 17 November that he is a director of Brickshaw Pty Ltd. He had sworn an earlier affidavit on 12 September acknowledging M Brickshaw & Co Pty Ltd as respondent but the Court accepts that this was an oversight and the company is Brickshaw Pty Ltd. Leave was granted to amend the application at the hearing on 1 December 1994.
PRETRIAL APPEARANCES
The applicant appeared in person at a Directions Hearing on 26 August. The respondent did not appear. The Directions Hearing was adjourned to 5 September and the respondent was advised by letter that on that day the matter would proceed.
On 5 September the applicant again appeared in person and Mr Mutavdzija of Higgins Teale appeared for the respondent.
The Court ordered that:
the matter be referred to the Industrial Relations Commission for conciliation
the respondent file and serve a Notice of Appearance and an affidavit on or before 12 September
the Directions Hearing be adjourned to 7 November.
On 28 October the Australian Industrial Registry advised the respondent’s solicitors and the Court that the Commission had made directions under Section 111(1)(t) of the Industrial Relations Act 1988 referring the matter for inquiry and report back as to whether the matter could be settled by conciliation. The Registry also advised that the Commission had received a report and that it was unable to settle the matter by conciliation and enclosed a certificate under S170ED(2).
The Court accepts the evidence of the applicant that he attended at the Commission for a Conciliation Conference and that when there was no appearance by or on behalf of the respondent a Vice President of the Commission personally telephoned the respondent’s solicitors and was advised that the respondent company was being wound up.
On 7 November the applicant appeared in person at the scheduled Directions Hearing. Again, there was no appearance by or for the respondent. The matter was fixed for a hearing on 1 December and the respondent’s solicitors were so advised by letter on 10 November.
On 30 November the Court received advice by telephone from the respondent’s solicitors that the respondent would not be represented at the hearing on 1 December and that the application would be “undefended”.
THE HEARING
On 1 December the applicant appeared. The respondent did not appear and was not represented. The applicant gave evidence on oath.
THE EMPLOYMENT RELATIONSHIP
The applicant worked for the respondent as a bricklayer from 23 June 1993 to termination on 20 June 1994. A crucial issue is whether the applicant was an employee of the respondent or was in a sub-contractor relationship with the respondent. The respondent itself appears to have been a sub-contractor.
In his affidavit of 12 September Michael Shaw deposes as follows:
I first met the Applicant after he responded to an advertisement in the newspaper which I placed to obtain bricklayers. When I interviewed the Applicant I informed him that he would be contracted as a sub-contractor on a day to day basis. After the company was incorporated in or about July 1993 the sub-contract agreement was between the applicant and the company. The Applicant agreed to this arrangement. The Company agreed to pay the Applicant $145.00 gross per day as opposed to $480.00 per week which my employees are currently being paid. As the Applicant was a sub-contractor and was therefore using his own vehicle, his own tools, working his own hours and obtaining work from other employers, the company agreed to pay him the said amount. On or about 20th May 1994, I informed the Applicant that the sub-contract arrangement was concluded but that the company was prepared to employ him as an employee on the basis that he be paid $480.00 gross per week which is the comparable wage to the company’s other employees. The Applicant refused to accept the offer of employment.”
The applicant saw himself as an employee paid a daily rate. At one stage in the hearing he responded as follows:
“Well, I was sub-contracted, but the agreement was I worked for him, you know what I mean. I mean, if I had have took a job somewhere else for a week, or two weeks, that would have been the end of my job with him.”
The Court is satisfied that the applicant used his own tools but except for a short initial period he did not use his own vehicle and he did not work his own hours or work for other employers.
THE INJURY AND THE WORK CARE CLAIM
The applicant stated that on or about Monday 16 May he hurt himself lifting cement bags while at work. He attended his doctor that day (Dr Walpole) and was diagnosed as having sustained a hernia. He continued working and on or about Wednesday 25 May the diagnosis was confirmed by a Dr Magesh who recommended remedial surgery.
The applicant further states that on or about Thursday 26 May he informed Mr Shaw and that the latter responded:
“Leave it for a few days and we will work something out.”
The applicant claims he raised the matter again a few days later (probably Monday 30 May) and that Shaw suggested the applicant go on the dole. A suggestion the applicant says he declined.
The applicant lodged a Work Care claim with GIO on 9 June and his evidence is that a Ms June Bolton, an officer of GIO, asked him on that day why his employer had not signed the claim papers and that he (the applicant) told Ms Bolton that the employer was unwilling to sign because “he reckons I did it somewhere else”.
THE TERMINATION
The best way to record the events of Monday 20 June 1994 is by the following extract from the transcript of the hearing. The questions are mine as the Judicial Registrar presiding. The answers are those of the applicant.
“What happened after you lodged your WorkCare claim?
Well, I was working, I was in a bit of pain, because in the morning it was okay, but as the day wore on, the lump was getting bigger and bigger in my groin, you know. Anyway, when I lodged my form with the GIO, on 9 June, they said, why hasn’t your employer signed them. I said he won’t sign them. He reckons I did it somewhere else. Anyway, they rang them up on 20 June, while we were at work on the job.
Well, you were on the job?
We were all on the job together, there was four of us.
Yes, and what happened. How do you know they rang him up?
What happened on 20 June?
The girl who was dealing with my claim .......
Who was dealing with your claim?
Jane Bolton.
Jane Bolton was dealing with your claim, yes, and did she ring you or him?
She rang him on his car phone.
Wait a minute. Were you with him at the time were you?
No, but she confirmed - because that day was the fatal day that he finished me off.
Yes?
And I rang up.
You rang up who?
Jane Bolton.
When, that day or the next day?
The same day.
After he had finished you up?
The same day, yes.
Yes, I know, but it was before or after he had finished you up?
It was in the morning.
Well, before we get to Jane Bolton, tell me what happened on 20 June, you went to work, did you?
Normal day, went to work, we were building a garage in Taylors Lakes, and - working away - 9 o’clock, I think it was about 9 o’clock the phone rang, 20 June, and after he received a phone call he come back to the site, because I was on the site, just a little bit away up the drive.
Well, about 9 o’clock, did you hear his phone ring?
Yes.
That was in his car, was it?
Yes.
Or his truck?
Truck, yes.
And what did you see?
He just said - he ran to the phone, yes.
You do not know what happened there?
No.
Except for what you were told later by Jane Bolton?
No.
Now just tell me what you saw. Okay, you saw him go to the phone, to the truck?
Yes.
And then what happened?
He came back to the job, and he asked me if I had lodged a WorkCare claim form. I said, yes. He said, well you can start walking. And that was the end of it. I asked him what about my wages, and he said, pick them up on Thursday night.
What day of the week was this?
20 June he sacked me.
Can you not remember what day of the week it was?
No, sorry, sir.
You cannot, you cannot remember the day you were sacked?
I think it was Monday.
It was a Monday?
Yes.
I am just surprised that you could not remember it at all. Okay. So, he said - you said what about my wages, and he said pick them up on Thursday night?
Yes.
What happened after that?
I went to his house, he gave me my wages.
No, before we get to the Thursday. When he said, get walking, start walking, what did you say?
I said, you must be joking. I said, you will not sign the forms, I’ve got to look after myself. So, you know ......
What did he say to that?
Well, feeling only ......(inaudible words).
You can tell me I am not easily shocked, what did he say?
Well, he told me to F off, and ......
Yes, he told you to fuck off?
Yes.
He didn’t tell you to F off, he told you to fuck off?
Yes.
Okay, what happened then?
I just picked up my tools. I said, you know, you’re being unreasonable, picked up my tools, and he said, go, you know. I was stuck out at Taylors Lakes, I had to get a train home, and two trains home, and a taxi. One of my co-workers offered me a car, and he said, take my car, and then your missus can bring you back, and my car back later. But I said, no.”
The applicant also tendered a statutory declaration from Gregory Leonard Phelvey which reads as follows:
“On 20 June 1994 Joe Atkinson was dismissed by Michael Shaw. The dismissal went as follows. At around about 9 o’clock Monday morning Mr Shaw received a phone call on his mobile phone, upon coming back to the workplace he said to J Atkinson:
‘Did you put that workcare form in’. J Atkinson replied that he did. Mr Shaw then said, ‘start walking’. A few short words were exchanged although I don’t recall what they were. After J Atkinson had packed his tools, he asked Mr Shaw about his wages. He was told, ‘pick them up Thursday nite’. J Atkinson then left the job.”
FINDINGS
This case has caused me some concern. The respondent entered an appearance through solicitors. The solicitors appeared at one Directions Hearing. The respondent never appeared at any of several Directions Hearings or at a scheduled Conciliation Conference.
The solicitors were no longer acting at the date of the hearing or, if they were still acting for the respondent company, they had determined not to appear at the hearing and described the application as, “undefended” on the day before the hearing.
An undefended application cannot succeed simply because it is undefended. The applicant must establish to the satisfaction of the Court that there has been an unlawful termination within the terms of Division 3 Part VIA of the Industrial Relations Act 1988.
I accept the evidence of the applicant which is supported by the statutory declaration of Gregory Leonard Phelvey.
The respondent ended the relationship with the applicant because the applicant had lodged a Work Cover application. If the applicant and the respondent were in an employment relationship within the terms of Division 3 Part VIA the respondent has breached S170DB, S170DC, S170DE and it is contrary to the spirit of S170DF(1)(a) although not an actual breach of that sub-section. It is unlawful. It is unjust. It warrants compensation under S170EE.
However, the Court has been concerned as to whether the applicant was employed by the respondent within the terms of the Industrial Relations Act 1988. There are some elements of the relationship and the applicant’s own evidence which suggest that the applicant was not an employee but a sub-contractor. This concern was expressed in some detail by the Court (see in particular pages 2, 11, 12, 23, 24, 27, 28 and 32 of the transcript).
However, after careful consideration of all the evidence, including the respondent’s claims as expressed by Shaw in paragraph 4 of his affidavit of 12 September, I have finally come to the conclusion that the applicant was an employee and I note and accept his evidence that in his year with the respondent he did not work for anyone else. I have also noted the taxation deductions certified by Shaw as taken from the applicant’s salary from 1 July 1993 to termination on 20 June 1994 (Exhibit A4).
I have concluded that, while the respondent was a sub-contractor, the resondent’s workers were employees and, in particular, the applicant was an employee. The applicant was subject to the orders and directions of Michael Shaw and Shaw was the key director of the respondent company. The company was the employer and, in practical terms, Shaw was the life and driving force of the company.
In Humberstone v Northern Timber Mills [1949] 79 CLR 389 at 404 Dixon J stated:
“The question is not whether in practice the work was in fact done subject to a direction and control exercised by an actual supervision or whether an actual supervision was possible but whether ultimate authority over the man in the performance of his work resided in the employer so that he was subject to the latter’s orders and directions.”
In Stevens v Brodribb Sawmilling Company Pty Limited [1985-86] 160 CLR 16 at 24, Mason J commented:
“A prominent factor in determining the nature of the relationship between a person who engages another to perform work and the person so engaged is the degree of control which the former can exercise over the latter. It has been held, however, that the importance of control lies not so much in its actual exercise, although clearly that is relevant, as in the right of the employer to exercise it.”
Mason J continues in Stevens:
“But the existence of control, whilst significant, is not the sole criterion by which to gauge whether a relationship is one of employment. The approach of this court has been to regard it merely as one of a number of indicia which must be considered in the determination of that question. Other relevant matters include, but are not limited to, the mode of remuneration, the provision and maintenance of equipment, the obligation to work, the hours of work and provision for holidays, the deduction of income tax and the delegation of work by the putative employee.”
And again Mason J in Stevens at 29:
“Control is not now regarded as the only relevant factor. Rather, it is the totality of the relationship between the parties which must be considered.”
And finally Wilson J and Dawson J at 36 and 37 in Stevens:
“The other indicia of the nature of the relationship have been variously stated and have been added to from time to time. Those suggesting a contract of service rather than a contract for services include the right to have a particular person do the work, the right to suspend or dismiss the person engaged, the right to the exclusive services of the person engaged and the right to dictate the place of work, hours of work and the like. Those which indicate a contract for services include work involving a profession, trade or distinct calling on the part of a person engaged, the provision by him of his own place of work or of his own equipment, the creation by him of goodwill or saleable assets in the course of his work, the payment by him from his remuneration of business expenses of any significant proportion and the payment to him of remuneration without deduction for income tax. None of these leads to any necessary inference, however, and the actual terms and terminology of the contract will always be of considerable importance.”
I have concluded that while Shaw in his affidavit describes the applicant as a sub-contractor it was the respondent, (i.e. Shaw’s company) which was a sub-contractor and the applicant was an employee.
I have concluded that the respondent has breached S170DB, DC and DE and that the applicant is entitled to an order for compensation. There was no valid reason for the termination and it was harsh, unjust and unreasonable.
For the reasons apparently expressed by Vice President McIntyre and also expressed by the Court on 1 December, an order for compensation may be unenforceable. The respondent company may no longer exist, or if it exists, it may now exist in name only. For these reasons and for other reasons re-instatement is clearly impracticable and it is not sought by the applicant.
I have noted the Work Cover payments made to the applicant for the period 5 July 1994 to 23 September 1994 and a special Work Cover payment of $1,003.40 made on 17 October 1994 but for the period roughly 20 June to 4 July (Exhibit A2).
I have noted that the applicant, on 1 December, expected to begin working as a bricklayer and as a sub-contractor with a partner on Monday 5 December 1994. I have concluded appropriate compensation should take account of the fact that he was unemployed until 5 December but genuinely trying to get employment since he was fit for work at the end of September 1994.
I believe he should be compensated for his unemployment in October and November and that appropriate compensation for the unlawful termination of employment is roughly the equivalent of 8 weeks work with the respondent which I calculate in general terms as $4,000. Accordingly, I order compensation in the sum of $4,000 and I direct that the Registrar settle and take out an Order to that effect.
I certify that this and the preceding pages are a true copy of the Reasons for Judgment of Judicial Registrar Ryan.
Associate :
Date : 27 March 1995
Appearances:
Applicant : Joseph Peter Atkinson
Date of Hearing : 1 December 1994
Judgment : 27 March 1995
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