Joseph Tiaki v Yarra City Council T/A Yarra City Council

[2018] FWC 214

[2018] FWC 214

The attached document replaces the document previously issued with the above code on 12 January 2018.

Amending endnote 52 to read [2007] AIRCFB 403 (Unreported, Lacy SDP, O’Callaghan SDP, Simmonds C, 13 July 2007).

Nade Petreska

Associate to Deputy President Millhouse

Dated 12 January 2018

[2018] FWC 214

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Joseph Tiaki
v
Yarra City Council T/A Yarra City Council
(U2017/9933)

DEPUTY PRESIDENT MILLHOUSE MELBOURNE, 12 JANUARY 2018

Application for an unfair dismissal remedy – minimum employment period not completed – labour hire arrangement – transfer of business – continuity of service.

[1] This decision concerns an application by Joseph Tiaki (Applicant) for an unfair dismissal remedy under s.394 of the Fair WorkAct 2009 (Act). It is not in dispute that the Applicant’s employment was terminated by Yarra City Council (Respondent) on 25 August 2017.

[2] The Applicant was employed in the position of Parking Control Officer (Night Crew) with the Respondent (Position). On the basis of the Form F3 – Employer Response to Unfair Dismissal Application, 1 he commenced in the Position on 15 May 2017. The details of the Position and the terms of that employment were set out in a letter of offer dated 9 May 2017,2 which the Applicant accepted on 10 May 2017.3

[3] Before commencing employment in the Position pursuant to the 9 May 2017 letter, the Applicant performed work for the Respondent between 5 August 2016 and 14 May 2017. I will refer to this period as the “relevant period.”

[4] The Respondent maintains that throughout the relevant period, the Applicant performed work for the Respondent, but was an employee of Design and Build Recruitment Pty Ltd (Design & Build), a labour hire company providing services to the Respondent. Therefore, the Respondent contends that the Applicant is not protected from unfair dismissal because he has not served the minimum employment period set out in s.383(a) of the Act.

[5] The Applicant says that during the relevant period, he was employed directly by the Respondent as a casual employee in the Position, such that he satisfied the minimum employment period. 4 The Applicant says that he was made a direct offer of employment by a Team Leader employed by the Respondent at an interview in or about July 2016,5 which he accepted (the Applicant’s primary submission).

[6] In the alternative, the Applicant says that he was a transferring employee in relation to a transfer of business from Design & Build to the Respondent and he had not been informed in writing by the Respondent that his service with Design & Build would not be recognised by the Respondent. Consequently, his period of service with Design & Build counted towards his period of employment with the Respondent, such that he satisfied the minimum employment period. 6 The Respondent rejects this submission and says there has been no transfer of business from Design & Build to the Respondent.

[7] The matter was the subject of a jurisdictional hearing on 17 November 2017. I had previously granted permission for both the Applicant and the Respondent to be represented by a lawyer or paid agent under s.596 of the Act. At the hearing, the Applicant gave evidence in support of his own application. The Respondent called evidence from Mr Fred Warner, Group Manager People, Culture & Community.

Statutory framework

[8] In order to be protected from unfair dismissal, the Applicant must have served the minimum employment period set out in s.383 of the Act.

[9] Section 383 is contained in Part 3–2 of the Act. Together with s.382, it defines which employees are protected from unfair dismissal. Sections 382 and 383 are relevantly in the following terms:

“382 When a person is protected from unfair dismissal

A person is protected from unfair dismissal at a time if, at that time:

(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and

…”

“383 Meaning of minimum employment period

The minimum employment period is:

(a) if the employer is not a small business employer—6 months ending at the earlier of the following times:

(i) the time when the person is given notice of the dismissal;

(ii) immediately before the dismissal; or

(b) if the employer is a small business employer – one year ending at that time.”

[10] In this case, the Respondent indicated that it had 800 or more employees at the time that the Applicant was dismissed. 7 Therefore, the minimum employment period that the Applicant had to serve in order to be eligible for an unfair dismissal remedy was six months.

[11] Section 384 of the Act relevantly provides as follows:

“384 Period of employment

(1) An employee’s period of employment with an employer at a particular time is the period of continuous service the employee has completed with the employer at that time as an employee.

(2) …

(b) if:

(i) the employee is a transferring employee in relation to a transfer of business from an old employer to a new employer; and

(ii) the old employer and the new employer are not associated entities when the employee becomes employed by the new employer; and

(iii) the new employer informed the employee in writing before the new employment started that a period of service with the old employer would not be recognised;

the period of service with the old employer does not count towards the employee’s period of employment with the new employer.”

Issues to be determined

[12] There are two issues for consideration. Firstly, whether the Applicant was employed directly by the Respondent during the relevant period or not. If the Applicant was not employed directly by the Respondent during the relevant period, then the second issue requiring determination is whether the Applicant was a transferring employee in relation to a transfer of business from Design & Build to the Respondent and if so, whether the Respondent informed the Applicant in writing before the new employment commenced that his period of service with Design & Build would not be recognised.

[13] In Re Advanced Australian Workplace Solutions Pty Ltd, 8 (AAW Solutions) a Full Bench of the Australian Industrial Relations Commission set out the appropriate course to be adopted when considering a threshold issue such as the Applicant’s primary submission:

“In our view, in such cases, the applicant should go first and adduce evidence directed at establishing that he or she was employed by the respondent. The respondent should then be invited to call evidence on the issue. It will be a matter for the respondent to decide whether or not to call evidence. The respondent may choose to call no evidence and submit that the applicant has failed to establish that the respondent was the employer.”  9

[14] The matter proceeded in accordance with the above course, with the Applicant first presenting evidence directed at establishing that he was employed by the Respondent during the relevant period, before the Respondent’s jurisdictional objection was heard.

Background

[15] The Applicant gave evidence that he saw an advertised position as a Parking Control Officer (Night Crew) on Seek in 2016. He was already “signed up with” Design & Build at that time. That contract, or the terms of any written agreement between the Applicant and Design & Build, are not in evidence. A representative from Design & Build called the Applicant to advise that “there’s a job opening from 6.30pm to 1am at Yarra. Are you interested?” The Applicant responded, “Yes.” 10

[16] The Applicant contends that he attended an interview with Anna Bourne, who he understood to be a Team Leader for the Respondent. The Applicant said that Ms Bourne asked him whether he wanted a job and the Applicant said yes. 11 He commenced on 5 August 2016 and was paid by Design & Build.

[17] It is not in dispute that the Respondent advertised the Position (a permanent part time role) in or about March 2017 and the Applicant applied. The Applicant said that he attended an interview with the Respondent and was offered the role.

[18] Mr Warner gave evidence that the Applicant was advised that his employment application with the Respondent was successful on 9 May 2017. 12 The Respondent provided the Applicant with a letter of appointment which specified that his start date would be 15 May 2017.13 Mr Warner said that prior to this date, the Applicant provided services to the Respondent via Design & Build, a labour hire agency.

The Applicant’s primary submission

[19] The Applicant says that he was employed directly by the Respondent in or around July 2016. 14 He says that all of the elements of a contract between he and the Respondent were satisfied and relies on the decision in AAW Solutions which stated, citing Macken’s Law of Employment:

“The law holds that before any simple contract… is enforceable it must be formed so as to contain various elements. These are:

1. There must be an “intention” between the parties to create a legal relationship, the terms of which are enforceable.

2. There must be an offer by one party and its acceptance by the other.

3. The contract must be supported by valuable consideration.

4. The parties must be legally capable of making a contract.

5. The parties must genuinely consent to the terms of the contract.

6. The contract must not be entered into for any purpose which is illegal.”  15

[20] The Applicant contends that the first and second elements were met because Ms Bourne offered him the Position during an interview conducted in or about July 2016, which he accepted. 16 He says that the contract was supported by valuable consideration because he was paid for his work, albeit indirectly (through Design & Build). The Applicant did not make any submissions in respect of the fourth, fifth and sixth elements on the basis that they go without saying.

[21] The Respondent submitted that the first, second and third elements could not be satisfied. It said that the fourth and sixth elements were not in contention and in relation to the fifth element, it said that there is no evidence before the Commission that would enable it to draw a conclusion that the Respondent “genuinely” consented to the terms of any contract. 17

Was the Applicant employed by the Respondent during the relevant period?

[22] Notwithstanding his submissions otherwise, the Applicant gave evidence that he was engaged as a casual employee of Design & Build. 18 Further, in relation to the discussions at the July 2016 interview, the following exchange took place during cross examination:

“Mr Brehas: …Now, did Anna ever say to you that you would be employed directly with the council?

Applicant I cannot recall.

Mr Brehas: Was there anything to lead you to believe that you were being employed directly with the council?

Applicant: No.

Mr Brehas: So you understood you were employed by your agency?

Applicant: Yes

Mr Brehas: They had placed you with the council?

Applicant: Yes.”    19

[23] There is no written agreement between the Applicant and the Respondent dating back to July 2016 in evidence before the Commission.

[24] The Applicant was asked whether he signed any written agreement with Design & Build in or about July 2016. The Applicant said that he did, but could not recall what the agreement said. 20 The agreement is also not in evidence before the Commission.

[25] In relation to the Applicant’s subsequent employment with the Respondent that commenced on 15 May 2017, the following exchange took place during cross examination:

“Mr Brehas: All right. Then you say you transferred to being a direct employee so… am I correct in understanding that what you mean by that is you transferred from being an agency employee with Design & Build to an employee directly with the council?

Applicant: Yes.”  21

[26] Mr Warner said that he did not have a copy of any written agreement between the Respondent and Design & Build that applied in or around July 2016 for the provision of labour. However, Mr Warner said that there was a relationship between the Respondent and Design & Build in July 2016, being “an agency arrangement policy.” 22

[27] Mr Warner said that on 4 August 2016, the Respondent entered into a services agreement with Comensura Pty Ltd (Comensura) under which Comensura would co-ordinate all orders for the supply of “contingent labour” to the Respondent (Services Agreement). In relation to the fact that the Services Agreement commenced operation one day prior to the Applicant’s 5 August 2016 engagement, Mr Warner said that he couldn’t say if the Applicant was “employed by our Comensura agreement or via our agency arrangement policy.” 23

[28] Since the introduction of the Services Agreement, Mr Warner said that the Respondent has continued its practice of engaging employees to perform parking officer duties directly, as well as utilising contingent labour, including from Design & Build, to perform the parking control officer work. 24 Mr Warner said that at the date of the hearing, the Respondent had four labour hire workers performing parking control officer work in its parking division.25

[29] In his closing submissions, the Applicant said that the Local Government Act 1989 (Vic) (LGA) sets out the requirements for the appointment of authorised officers such as Parking Control Officers, and these requirements make it “an impossibility” for the Respondent to “order an anonymous but appropriately qualified person from a labour hire company to fill a position…” because “the potential parking officer must be personally interviewed, photographed, put forward and authorised” before commencing work. 26 The Respondent said that there is nothing in s.224 of the LGA which requires a potential parking control officer to be “personally interviewed” and put forward as a precondition of being appointed an authorised officer. The Respondent said that under the LGA, it has the power to appoint “any person other than a Councillor” and this extends to persons such as the Applicant, engaged “by way of arrangements other than employment arrangements (including via labour-hire agencies and direct contracting arrangements)” and the word “appoint” in s.224(1) of the LGA, rather than “employ,” makes this clear.27

Objections to evidence

[30] At the hearing, the Respondent objected to various paragraphs of the Applicant’s witness statement (Exhibit A1) from being received into evidence, including the exchange between the Applicant and Ms Bourne summarised at [16] above, on the basis that it was hearsay within the meaning of s.59 of the Evidence Act 1995 (Cth) (Evidence Act). 28 Ms Bourne was not called to give evidence. The evidence was received by the Commission and the parties filed submissions addressing their respective positions as to the weight that should be given to it.29

[31] The Respondent contends that the statements attributed to Ms Bourne should be given little, if any, weight. It says that in any case, Ms Bourne did not have the authority to employ the Applicant on behalf of the Respondent. 30 Mr Warner said “well, Anna didn’t have the power to offer employment to the Applicant.”31 When asked whether or not she did in fact offer employment to the Applicant on behalf of the Respondent, Mr Warner said, ”I’m aware that she didn’t. She would have followed the – did follow the process for agency and that is as always would meet with a prospective agency and would ask the questions required to be satisfied that the person can do what’s required of, in this case, him.”32

[32] The Applicant says that the statements attributed to Ms Bourne are not hearsay but in any case, the evidence should be given full weight because it is the best evidence before the Commission as to what happened in relation to the Applicant’s engagement in July 2016, the evidence would not be unfairly prejudicial to the Respondent’s interests, and there is no contrary evidence before the Commission.

[33] There is no automatic prohibition in proceedings before the Commission on the reliance on hearsay evidence. The Commission is obliged by statute to perform its functions in a manner that is fair and just pursuant to s.577(a) of the Act. 33 Whilst the Commission is not bound by the rules of evidence, that does not mean that those rules are irrelevant34 and the Commission tends to follow the rules of evidence as a general guide to good procedure.35

[34] What is ultimately required of the Commission is to ensure judicial fairness in the circumstances of this case. 36 I have taken into account that in the absence of Ms Bourne’s statements, there is limited evidence before the Commission as to the Applicant’s engagement in or about July 2016. I have weighed this against the fact that there was no method by which the Respondent could test the allegation made by the Applicant that Ms Bourne offered the Applicant employment with the Respondent, because Ms Bourne was not called to give evidence in the proceedings, and there is some question as to the reliability of the evidence given the interview occurred over a year and a half ago. However, the Respondent did not attempt to call any evidence in reply to what is a material fact in issue, despite having been on notice of the Applicant’s assertion well in advance of the hearing. I do not accept the Respondent’s argument that this is adequately explained because the Commission’s directions required it to file and serve its evidentiary material concerning its jurisdictional objection first.

[35] The evidence is relevant to a material fact in issue. On balance, I am not of the view that the probative value of the evidence is outweighed by any unfair prejudice to the Respondent, given its election not to call evidence in reply. 37 Accordingly, I am satisfied that judicial fairness requires that the statements attributed to Ms Bourne above38 be given weight.

[36] However, on an assessment of the evidence, I am not satisfied that Ms Bourne had the authority to employ the Applicant on behalf of the Respondent, as alleged by the Applicant. There is no evidence before the Commission setting out the limits on Ms Bourne’s power to contractually bind the Respondent, but Mr Warner gave evidence that Ms Bourne did not have the power to “hire or fire direct labour.” 39 Given Mr Warner’s role and experience with the Respondent, I accept his evidence. In my view, the position here can be distinguished from that considered in Khan v Risk Protection Group,40 advanced by the Applicant, where a verbal offer of employment was made by a senior management employee in the role of Operations Manager, who had the authority to hire employees and in fact employed the applicant in that case.

[37] Further, I am not satisfied that the statement attributed to Ms Bourne (“Anna asked me whether I wanted a job”) goes so far as to offer the Applicant a role as an employee of the Respondent, as alleged, or rather to approve the Applicant for engagement as a labour hire employee performing work with the Respondent. The inability to hear Ms Bourne’s evidence on this point tested under cross examination means that I am not satisfied that Ms Bourne intended that her statement had the meaning now attributed to it. This is particularly so in circumstances where, as is addressed further below, the Applicant gave evidence that there was nothing said by Ms Bourne during the interview that led the Applicant to believe that he was being directly employed by the Respondent. 41

[38] The Respondent also contends that the Commission should give limited, or no, weight to various other paragraphs of Exhibit A1 because they are either hearsay or irrelevant. 42 I am not persuaded that the weight given to this material should be discounted, as I am not satisfied that this is inadmissible under s.59 of the Evidence Act or that it is irrelevant. Accordingly, I have also given weight to the evidence contained in the balance of the Applicant’s witness statement.

Consideration

[39] It was incumbent on the Applicant to adduce evidence directed at establishing that he was employed by the Respondent during the relevant period. In my view, the evidence does not establish this.

[40] There must be an intention between the parties to create a legal relationship. The test is objective, not subjective. 43 The Full Bench in AAW Solutions noted that:

“This point is referred to in several of the cases to which we have referred. In Teen Ranch (above) (p.201):

‘The real question is whether the arrangements between the parties evidenced any intention to enter into legal relations. Such an intention is essential.’

In Denham (above), Romer J said (p.447):

‘…the relationship of master and servant cannot be established except by mutual consent.’”    44

[41] Viewed objectively, I am not satisfied that there was an intention on the part of the Applicant or the Respondent to enter into legal relations with the other in or about July 2016. Neither the Applicant nor the Respondent thought that there was a contract of employment between them. The Applicant gave evidence that:

(a) there was nothing said or done during the interview with Ms Bourne that would lead him to believe that he was being employed directly with the Respondent; 45

(b) he understood that he was employed by Design & Build; 46

(c) he understood that Design & Build would place him with the Respondent; 47 and

(d) he was employed with Design & Build on a casual basis. 48

[42] Similarly, the Respondent considered the Applicant to be an “agency” worker and I consider this was open to it in the circumstances for the following reasons.

[43] Firstly, while there was no contract in evidence, I accept that the Respondent had a relationship with Design & Build in July 2016 to supply it with supplementary labour and the Applicant was presented to it as a candidate as part of this arrangement. The Services Agreement identifies by name the incumbent suppliers of temporary labour to the Respondent as at 4 August 2016 and refers to Design & Build. 49 I am satisfied that the execution of the Services Agreement took place against a background, at least inferentially, of prior labour hire arrangements existing between the Respondent and Design & Build. This, together with Mr Warner’s evidence, satisfies me that there was such an arrangement between the Respondent and Design & Build in or about July 2016.

[44] Secondly, it is apparent on the material before the Commission that employees of the Respondent are employed through a formal process and provided with a written contract of employment recording the key terms of their relationship, including their remuneration and conditions of employment. This is supported by the material the Respondent provided to the Applicant in May 2017 when it offered him direct employment in the Position. In addition to a letter of offer, this included a requirement that the Applicant provide the Respondent with detailed information through the Respondent’s portal and the conduct of reference checks. It is clear on the evidence that a similar process was not undertaken by the Respondent in relation to the Applicant in or about July 2016. Even if that process has evolved somewhat in the short period between July 2016 and May 2017, the complete lack of material passing between the Respondent and the Applicant in July 2016 and the absence of discussion between them satisfies me that the Respondent did not hold the requisite intention to enter into a contract with the Applicant.

[45] The view shared by both the Applicant and the Respondent that they had not entered into the relationship of employee and employer carries weight.

[46] The second essential element of a contract is that there must be an offer by one party and acceptance by the other. For the reasons given above in respect of the statement attributed to Ms Bourne, the evidence does not establish such an offer being made by the Respondent. Accordingly, I am not satisfied that an offer of employment was made to the Applicant by the Respondent.

[47] The third essential element of a contract is consideration. It is clear that no consideration passed between the Respondent to the Applicant. The Applicant was paid by Design & Build and signed a tax file number declaration with it. 50 The Applicant contends that Design & Build was simply acting as an agent for the Respondent in effecting payments to him51 and relied upon the decision in Kitchen Design Systems Pty Ltd52 (Kitchen Design) in which a Full Bench found that consideration could exist via a circuitous route. However, there is no evidence that provides any basis for concluding that Design & Build acted as the Respondent’s agent, or as an intermediary, in making payments to the Applicant. Design & Build issued the Applicant with a PAYG payment summary for the year ending 30 June 2017 which specified the gross payments made by it to the Applicant with the payment type attributed to “labour hire.”53

[48] The matter before me can be distinguished from the decision in Kitchen Design. There is no evidence here, as in Kitchen Design, that payments made by Design & Build could be seen to be payments made by the Respondent.

[49] Finally, it is not in dispute that there was no written contract between the Applicant and the Respondent dating back to July 2016. In the absence of a written contract, I have considered whether, on the evidence available, any other factual matters demonstrate the existence of an employment relationship during the relevant period.

[50] In my view, the evidence concerning the relationship between the Applicant and the Respondent dispels any notion that the Respondent was in fact the employer of the Applicant during the relevant period. I note that, in addition to the matters already identified above:

(a) The Applicant did not describe himself in his application for employment with the Respondent in May 2017 as a current employee of the Respondent. When asked if he had ever worked for the Respondent before, the Applicant responded, “no.” 54Further, the Applicant described his current experience in the following way: “Most recently I have been contracting with City of Yarra as a Night Patrol Parking officer.”55

(b) In his witness statement, the Applicant says that when he was informed that he had secured the Position commencing on 15 May 2017, that he “transferred to being a direct employee.” When asked about this under cross examination, the Applicant said “the [interview] with Shane, that’s for the job directly with the council, not the job from Design & Build, yes.” 56On his own evidence, the Applicant accepted that he ceased being a labour hire employee of Design & Build and instead became directly employed by the Respondent from 15 May 2017.

(c) The Services Agreement came into effect one day prior to the Applicant’s 5 August 2016 assignment commencement date. The Applicant gave evidence that he initially provided his timesheet to Design & Build but subsequently provided this to Comensura, pursuant to the Services Agreement. The Services Agreement makes it clear that labour hire workers supplied by a “Supplier” (as defined, which includes Design & Build) to the Respondent “are not employees of either Comensura or the Client [the Respondent].” 57Further, it contains an express “Non-Employment’ clause confirming that “no Contingent Labourer will be or become [sic] an employee of either the Client [the Respondent] or Comensura for any purpose…”58 I do not accept the Applicant’s assertion that the Services Agreement is irrelevant.59

[51] The above picture gives no support to the proposition that the Applicant was, in reality, an employee of the Respondent. Given my findings, I have not considered it necessary to consider the remaining elements of a contract.

[52] Further, I do not accept the Applicant’s submission that the requirements of the LGA effectively prevented the engagement of a labour hire worker by the Respondent. Section 224(1) of the LGA makes it clear that the Respondent may appoint any person (other than a Councillor) to be an authorised officer. I accept that there is no restriction under the LGA on the appointment of labour hire workers. Further, and in any event, this does not persuade me that the Applicant was an employee of the Respondent during the relevant period.

Conclusion

[53] Taking into account the entire factual matrix, I am not satisfied, on the evidence, that there was an employment relationship between the Applicant and the Respondent during the relevant period. I consider that the Applicant was employed by Design & Build, noting that the Applicant also considered this to be the case. Accordingly, the Applicant’s primary submission must fail.

[54] Finally, although the Applicant admits that he had signed a written agreement with Design & Build in 2016, 60 the agreement is not in evidence. The Respondent invited the Commission to draw a Jones v Dunkel61 inference because, in its submission, the Applicant has not provided any reasonable explanation for not producing it. In the circumstances, and noting that I am in a position to reliably find facts, draw conclusions from them and determine this threshold issue without drawing the interference sought, I decline to do so.62

The Respondent’s jurisdictional objection

[55] Having determined that no employment contract existed during the relevant period, the second issue requiring determination is whether the Applicant was a transferring employee in relation to a transfer of business from Design & Build to the Respondent; and if so, whether the Respondent informed the Applicant in writing before the new employment commenced that his period of service with Design & Build would not be recognised.

Statutory framework

[56] Section 22(5) of the Act specifies when service with one employer counts as service with another employer. It relevantly provides that:

“When service with one employer counts as service with another employer

(5) If there is a transfer of employment (see subsection (7)) in relation to a national system employee:

(a) any period of service of the employee with the first employer counts as service of the employee with the second employer; and

(b) the period between the termination of the employment with the first employer and the start of the employment with the second employer does not break the employee’s continuous service with the second employer (taking account of the effect of paragraph (a)), but does not count towards the length of the employee’s continuous service with the second employer.”

[57] Section 22(7)(b) of the Act provides that there is a transfer of employment for non-associated entities if the employee is a transferring employee in relation to a transfer of business from the first employer (here, Design & Build) to the second employer (the Respondent). It relevantly states:

“Meaning of transfer of employment etc.

(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:

…

(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.”

[58] It is not in dispute that Design & Build and the Respondent are not associated entities.

[59] For s.22(7)(b) of the Act to be satisfied, a transfer of business must have occurred. The question to be determined is whether there was a transfer of business from Design & Build to the Respondent as non-associated entities. A transfer of business takes its meaning from s.311(1) of the Act, which relevantly provides:

“Meanings of transfer of business, old employer, new employer and transferring work

(1) There is a transfer of business from an employer (the old employer) to another employer (the new employer) if the following requirements are satisfied:

(a) the employment of an employee of the old employer has terminated;

(b) within 3 months after the termination, the employee becomes employed by the new employer;

(c) the work (the transferring work) the employee performs for the new employer is the same, or substantially the same, as the work the employee performed for the old employer;

(d) there is a connection between the old employer and the new employer as described in any of subsections (3) to (6).”

[60] The Applicant contends that there is a connection between Design & Build and the Respondent within the meaning of s.311(5) of the Act, which provides:

“New employer ceases to outsource work to old employer

(5) There is a connection between the old employer and the new employer if:

(a) the transferring work had been performed by one or more transferring employees, as employees of the old employer, because the new employer, or an associated entity of the new employer, had outsourced the transferring work to the old employer or an associated entity of the old employer; and

(b) the transferring work is performed by those transferring employees, as employees of the new employer, because the new employer, or the associated entity of the new employer, has ceased to outsource the work to the old employer or the associated entity of the old employer.”

Was there a transfer of business between Design & Build and the Respondent?

[61] The Applicant contends that there was a transfer of business. He said that his employment with Design & Build terminated on 14 May 2017 63 and he commenced employment with the Respondent on 15 May 2017, thereby satisfying the requirements of s.311(1)(a)-(b) of the Act.

[62] It is not in dispute that the work that the Applicant performed for the Respondent was the same, or substantially the same, as the work that he performed for Design & Build during the relevant period, such that s.311(1)(c) of the Act is not in dispute between the parties. 64

[63] In respect of s.311(d), the Applicant relies upon s.311(5) of the Act in support of his argument that there is a connection between Design & Build and the Respondent. He submits that engaging Design & Build to provide labour means that the Respondent outsourced that work. He relies upon the decision in Burdziejko v ERGT Australia Pty Ltd 65 (Burdziejko) in support of his argument that the subsequent employment of the Applicant meant that the Respondent had ceased to outsource that work to Design & Build, thereby satisfying s.311(5) of the Act.

[64] The Respondent rejects the submission that there has been a transfer of business. It contends that the Applicant has not adduced any material evidencing that his employment with Design & Build has terminated (as aside from the Applicant’s assignment with the Respondent as a labour hire worker having terminated). Accordingly, it says that s.311(1)(a) of the Act has not been satisfied.

[65] In respect of s.311(1)(b) of the Act, the Respondent accepts that the Applicant commenced employment with it on 15 May 2017, but does not concede that this was within three months after the termination of his employment with Design & Build, given its position concerning s.311(1)(a) of the Act above.

[66] In relation to s.311(1)(d) of the Act, the Respondent says that:

(a) The Respondent continues to use the services of labour hire agencies, including Design & Build, to provide labour to it as and when required and relies upon the evidence given by Mr Warner to this effect. 66

(b) Concurrently, the Respondent continues to employ parking control officers directly and relies upon the evidence given by Mr Warner to this effect. 67

(c) The Applicant independently applied for a vacancy with the Respondent and was not “brought across” from Design & Build. The position that the Applicant filled arose as a consequence of a former employee of the Respondent leaving the role.

(d) The facts of this matter can be distinguished from those in Burdziejko. In that case, the Commission found that the new employer (ERGT) “decided that it no longer wanted Hays [the old employer] to perform that work and decided to perform the work in house and employed Ms Burdziejko to do the same work.” 68 This is not a case where the Respondent no longer wanted Design & Build to continue to provide labour to it. On the contrary, the Respondent continues to require Design & Build to provide labour to perform parking control officer work. Consequently, the Respondent has not ceased to outsource the work to Design & Build.

Consideration

[67] Much was made by the Respondent as to whether the Applicant’s employment with Design & Build has terminated. I am satisfied, by reference to the Applicant’s final timesheet with Design & Build 69 that the Applicant’s last working week as an employee with Design & Build concluded on 14 May 2017. The evidence indicates that the Applicant’s employment with Design & Build ended when the Applicant’s assignment with the Respondent concluded in order for him to commence direct employment in the Position. Accordingly, I consider that both s.311(1)(a) and (b) of the Act are satisfied.

[68] As noted above, s.311(1)(c) is not in dispute. It remains, therefore, to consider whether there is a connection between Design & Build and the Respondent pursuant to s.311(5) of the Act. It was not submitted, and nor do I find, that any of subsections 311(3), 311(4) and 311(6) of the Act apply.

[69] In order for there to be a ceasing of the outsourcing under s.311(5) of the Act, there must first be an outsourcing. This requires consideration as to whether the arrangement by which Design & Build provided labour to the Respondent constitutes “outsourcing.”

[70] There is no definition of the word “outsourcing” in the Act. It is evident from the legislation that the phrase is to be broadly interpreted. In Burdziejko, Deputy President Gooley referred to the Macquarie dictionary definition of the word “outsource,” which means “to contract (work) outside the company rather than employ more in-house staff.” 70I was not taken to any Full Bench authorities dealing with this issue.

[71] In my view, before the Respondent can be said to have outsourced the work, the work must first have been performed in-house. Here, the “work” is the parking control officer work. The evidence establishes that the Respondent has, at least since in or about July 2016, employed Parking Control Officers directly to perform this work.

[72] In addition, the Respondent has, at least since in or about July 2016, had arrangements with labour hire companies, including Design & Build, to provide it with supplementary labour to perform parking control officer work. The Applicant’s labour was provided to the Respondent by Design & Build for this purpose during the relevant period.

[73] In August 2016, the Respondent centralised its arrangements with the various agencies from which it sourced labour, through the execution of the Services Agreement. I am satisfied that since August 2016, the Respondent has continued to obtain supplementary labour from agencies, including Design & Build, to perform parking control officer work, as well as employ Parking Control Officers directly.

[74] In deciding that it no longer wished to perform “as much work” of that particular type 71 and engaging a third party to perform the parking control officer work, I am satisfied that the Respondent outsourced the parking control officer work. The focus of the Act is on the transfer of work (and no reference is made to the need to also outsource peripheral activities or part of a business).

[75] However, s.311(5) of the Act requires me to be satisfied that the Respondent has ceased to outsource the parking control officer work to Design & Build. I am not satisfied that this has occurred. The arrangements between the Respondent and Design & Build for the supply of contingent labour to perform parking control officer work remain on foot and have been, since August 2016, subsumed into the Services Agreement.

[76] Mr Warner gave evidence that the Respondent continues to use contingent labour, including from Design & Build through the Services Agreement, to perform the parking control officer work. I accept his evidence. As noted earlier, Mr Warner said that at the date of the hearing of this matter, the Respondent had four labour hire workers performing the work in its parking division. 72 Concurrently, the Respondent continues to perform the parking control officer work in-house through the direct employment of Parking Control Officers.

[77] The mere fact that the Respondent offered the Applicant direct employment in the Position, carrying out work that has continued to be performed in house, does not mean that the Respondent has ceased to outsource the parking control officer work. There continues to be the same scope of outsourcing of the parking control officer work by the Respondent. The outsourcing has continued, unaffected by the direct employment of the Applicant. It is clear on the evidence that it has not ceased.

[78] I accept the Respondent’s submission that the matter before me can be distinguished from the decision in Burdziejko given the different factual circumstances.

[79] Accordingly, I am not satisfied that the direct employment of the Applicant means that the Respondent has “ceased to outsource the work” pursuant to s.311(5) of the Act.

Conclusion

[80] On the basis of the material before me, I find that there is no connection between Design & Build and the Respondent as required by s.311(1)(d) of the Act. Accordingly, there was no transfer of business from Design & Build to the Respondent and the Applicant was not a transferring employee.

[81] As I am not satisfied that there was a transfer of business, the conditions of s.22(7) and therefore s.22(5) of the Act are not satisfied and the Applicant’s service with Design & Build does not count as service with the Respondent.

[82] Given my finding, it is unnecessary for me to consider whether the Respondent informed the Applicant in writing before the new employment commenced that his period of service with Design & Build would not be recognised pursuant to s.384(2)(b) of the Act.

[83] The Applicant was employed by the Respondent on 15 May 2017. His employment was terminated on 25 August 2017. To be protected from unfair dismissal, the Applicant must have completed a period of employment with the Respondent of at least six months at the time of the termination of his employment. The Applicant was employed for three months and 10 days at the time of the dismissal. Therefore, he is not protected from unfair dismissal.

Order

[84] The application is dismissed and an order to that effect will be issued with this decision.

DEPUTY PRESIDENT

Appearances:

G. Dircks for the applicant.

C. Brehas, solicitor,for the respondent.

Hearing details:

2017.

Melbourne:

November 17.

Final written submissions:

Applicant, 11 December 2017

Respondent, 11 December 2017

 1   Dated 19 September 2017.

 2   Exhibit R1, Annexure FW-4.

 3 Exhibit R1 at [9].

 4 Applicant’s outline of submissions dated 2 November 2017 at [2].

 5   Transcript at PN79.

 6 Applicant’s outline of submissions dated 2 November 2017 at [23].

 7   Form F3 – Employer Response to Unfair Dismissal Application dated 19 September 2017 at 1.7.

 8   Re Advanced Australian Workplace Solutions Pty Ltd Print S0253 (AIRCFB, Giudice J, McIntyre VP and Redmond C, 25 October 1999).

 9 Ibid at [94].

 10 Exhibit A1 at [6].

 11 Exhibit A1 at [10].

 12   Exhibit R1, Annexure FW-3.

 13   Exhibit R1, Annexure FW-4.

 14   Applicant’s closing submissions – primary argument dated 4 December 2017 at [2] and [30].

 15   Re Advanced Australian Workplace Solutions Pty Ltd Print S0253 (AIRCFB, Giudice J, McIntyre VP and Redmond C, 25 October 1999) at [49]; citing Macken, O'Grady and Sappideen, Macken’s Law of Employment (4th ed, 1997) at p. 74.

 16   Applicant’s closing submissions – primary argument dated 4 December 2017 at [8] and [14].

 17   Respondent’s closing submissions – jurisdiction dated 5 December 2017 at [32] and [49].

 18   Transcript at PN67, PN69, PN74.

 19   Transcript at PN82-PN85.

 20   Transcript at PN62-PN64.

 21   Transcript at PN95.

 22   Transcript at PN145.

 23   Transcript at PN145.

 24   Transcript at PN288-PN290.

 25   Transcript at PN289.

 26   Applicant’s closing submissions – primary argument dated 4 December 2017 at [22]-[23].

 27 Respondent’s closing submissions in reply dated 11 December 2017 at [8].

 28   Transcript at PN34-PN42.

 29   Applicant’s closing submissions – primary argument dated 4 December 2017; Respondent’s closing submissions – jurisdiction dated 5 December 2017; Applicant’s closing submissions in reply dated 11 December 2017; Respondent’s closing submissions in reply dated 11 December 2017.

 30   Transcript at PN143 and PN156-PN157.

 31   Transcript at PN156.

 32   Transcript at PN156-PN157.

 33   Pearse v Viva Energy Refining Pty Ltd[2017] FWCFB 4701 at [14].

 34   Wong v Taitung Australia Pty Ltd[2017] FWCFB 990 at [31]; Hail Creek Coal Pty Ltd v Construction, Forestry, Mining and Energy Union (2004) 143 IR 354 at [48]-[50].

 35   King v Freshmore (Vic) Pty Ltd (unreported, AIRCFB, Ross VP, Williams SDP, Hingley C, 17 March 2000) Print S4213 at [61]-[62]; Fair Work Act 2009 (Cth) s.591.

 36   Enterprise Flexibility Agreements Test Case (1995) Print M0464 per Ross VP, Maher DP and Cox C at p.13; Pochi v Minister for Immigration and Ethnic Affairs (1979) 36 FLR 482 at 509.

 37   Transfield Construction Pty Ltd v The Australian Workers Union and Ors (2002) AIRC Print 924386 at [44].

 38 Exhibit A1 at [10].

 39   Transcript at PN143.

 40   [2017] FWC 740.

 41   Transcript at PN83.

 42   Exhibit A1 at [6], [9], [13], [15] and [16].

 43   Damevski v Giudice & Ors [2003] FCAFC 252 at [95].

 44   Re Advanced Australian Workplace Solutions Pty Ltd Print S0253 (AIRCFB, Giudice J, McIntyre VP and Redmond C, 25 October 1999) at [66].

 45   Transcript at PN83.

 46   Transcript at PN84.

 47   Transcript at PN78.

 48   Transcript at PN69 and PN74.

 49   Exhibit R1, Annexure FW-7, Schedule 2 at cl. 1.3 and Appendix A at p.24.

 50   Transcript at PN66.

 51   Applicant’s outline of submissions dated 2 November 2017 at [17]; Applicant’s closing submissions in reply dated 11 December 2017 at [112] and [129].

 52   [2007] AIRCFB 403 (Unreported, Lacy SDP, O’Callaghan SDP, Simmonds C, 13 July 2007).

 53   Exhibit A3.

 54   Exhibit R1, Annexure FW-2 at p.2

 55   Exhibit R1, Annexure FW-2 at p.3.

 56   Transcript at PN87.

 57   Exhibit R1, Annexure FW-7 at p. 2.

 58   Exhibit R1, Annexure FW-7 at cl. 18. See also Annexure FW-7, Schedule 6 at cl. 16.

 59   Wilton v Coal and Allied Operations Pty Ltd [2007] FCA 725, 161 FCR 300 at 177.

 60   Transcript at PN61.

 61 (1959) 101 CLR 298.

 62   King v Freshmore (Vic) Pty Ltd (unreported, AIRCFB, Ross VP, Williams SDP, Hingley C, 17 March 2000) Print S4213 at [88]-[90].

 63   Transcript at PN180.

 64 Respondent’s closing submissions – jurisdiction dated 5 December 2017 at [56].

 65   [2015] FWC 2308.

 66   Transcript at PN289.

 67   Transcript at PN290.

 68   [2015] FWC 2308 at PN37.

 69   Exhibit A2.

 70   [2015] FWC 2308 at [26].

 71   Item 1224 of the Fair Work Bill 2008 Explanatory Memorandum.

 72   Transcript at PN289.

Printed by authority of the Commonwealth Government Printer

<PR599441>