Kristy Gibbons and Secretary, Department of Social Services

[2014] AATA 398

[2014] AATA 398

Division	GENERAL ADMINISTRATIVE DIVISION
File Number	2013/4370
Re	Kristy Gibbons
APPLICANT
And	Secretary, Department of Social Services
RESPONDENT

DECISION

Tribunal	Senior Member R W Dunne
Date	23 June 2014
Place	Adelaide

The Tribunal affirms the decision under review.

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Senior Member R W Dunne

CATCHWORDS

SOCIAL SECURITY – pensions, benefits and allowances – youth allowance – earnings by applicant as a trainee – whether a "job seeker" or a "new apprentice" – "income free area" – decision under review affirmed.

LEGISLATION

Social Security Act 1991 (Cth), ss 23(1), 540, 540AA, 1067G(1), 1067G-H29

CASES

Lane and Ors v Arrowcrest Group Pry Ltd (1990) 27 FCR 427

REASONS FOR DECISION

Senior Member R W Dunne

23 June 2014

INTRODUCTION

1. The applicant in this case is Ms Kristy Gibbons.  She was in receipt of youth allowance as a full-time student.  A Centrelink officer decided that she should not be paid at the rate of youth allowance that applied to a full-time apprentice or trainee.  She requested a review of the decision by an authorised review officer who decided that the original decision was correct.  When she appealed to the Social Security Appeals Tribunal (“SSAT”), the decision of the authorised review officer was affirmed.  She has applied to this Tribunal for a review of the decision of the SSAT.

2. At the hearing Ms Gibbons was represented by her father, and Mr C Visser (from Department of Human Services) appeared for the respondent.  The Tribunal received into evidence the T documents[1] lodged pursuant to s 37 of the Administrative Appeals Tribunal Act 1975, together with a letter dated 18 April 2014 from Traineeship and Apprenticeship Services of the Department of Further Education, Employment, Science and Technology.[2]

   [1] Exhibit R1.

   [2] Exhibit A1.

   ISSUES FOR THE TRIBUNAL

3. The following are the issues for the Tribunal:

   (a)Is the applicant a “new apprentice” under the definition of that expression in the Social Security Act 1991 (“Act”)?

   (b)Should the applicant’s “income free area” in respect of her earnings under the youth allowance rate calculator be as a “new apprentice” or as a “job seeker”?

   LEGISLATION

4. The legislation that is presently relevant is contained in the Act. Sections 540 and 540AA deal with the requirements for and the entitlement to youth allowance. Section 1067G of the Act provides a rate calculator for youth allowance. Section 23 of the Act provides a definition of “new apprentice”. The relevant parts of those sections read:

   “23  General definitions

   (1)   In this Act, unless the contrary intention appears:

   …

   new apprentice means a person who has a current Commonwealth registration number in relation to a full-time apprenticeship, traineeship or trainee apprenticeship under the scheme known as New Apprenticeships, but does not include a person whose registration number is suspended.

   …”

   “540 Qualification for youth allowance - general rule

   Subject to this Subdivision, a person is qualified for a youth allowance in respect of a period if:

   (a)Either of the following applies:

   (i)      throughout the period the person satisfies the activity test (see Subdivision B) or is not required to satisfy the activity test (see Subdivision C);

   (ii)     the person is a CDEP Scheme participant (see section 1188B) in respect of the period;

   (b)throughout the period the person is of youth allowance age (see Subdivision D); and

   (c)throughout the period the person satisfies any requirements relating to Youth Allowance Employment Pathway Plans that apply to the person under Subdivision E; and

   (d)throughout the period, the person:

   (i)      is an Australian resident; or

   (ii)     is exempt from the residence requirements within the meaning of subsection 7(7).”

   “540AA qualification for youth allowance – new apprentices

   Subject to this Subdivision, a person is qualified for a youth allowance in respect of a period if, throughout the period:

   (a)the person is a new apprentice; and

   (b)the person is of youth allowance age (see Subdivision D); and

   (c)the person:

   (i)      is an Australian resident; or

   (ii)     is exempt from the residence requirement within the meaning of subsection 7(7).”

   “1067G(1)  Rate of youth allowance

   Youth allowance rate calculator.  The rate of youth allowance of a person referred to in section 556 is to be calculated in accordance with the Rate Calculator in this section.”

   “Ordinary income free area

   1067G–H29  A person’s ordinary income free area is:

   (a)if the person is undertaking full-time study at any time in the fortnight in respect of which a youth allowance may be payable - $400; or

   (aa)if the person is a new apprentice at any time in the fortnight in respect of which a youth allowance may be payable - $400; or

   (b)Otherwise - $143.”

   BACKGROUND AND EVIDENCE

5. Ms Gibbons was in receipt of youth allowance as a full-time student when she completed year 12 over two years at her high school, finishing in 2012.  On 24 December 2012, she contacted Centrelink and advised that she would be commencing a full-time apprenticeship with State Tennis in February 2013.  On 19 March 2013, she advised Centrelink that this had occurred. 

6. On 15 May 2013, a Centrelink officer made a decision that Ms Gibbons should not be paid at the rate of youth allowance that applied to a full-time apprentice or trainee. The decision was that her “income free area” under the youth allowance rate calculator in the Act in respect of her earnings was as a “job seeker”, not as a “new apprentice”. This meant that, as a job seeker, her earnings with State Tennis as a trainee were subject to a less favourable income test. She said her hours of employment with State Tennis had changed from “School Based 8 to Part Time 24”.

7. Ms Gibbons explained that Traineeship and Apprenticeship Services had applied to vary her contract with effect from 21 January 2013, until completion.  In a letter she received from the Manager, Traineeship and Apprenticeship Services on 13 March 2013[3] it was confirmed that the period of her training contract, from the Commencement Date, was two years one month, with a nominal completion date of 18 May 2014.  She said she had agreed with State Tennis initially that she would be a full-time trainee for 38 hours per week.  When there was not enough coaching work for her as a full-time trainee, she agreed to enter into a variation of the contract which reduced her hours to 24 hours per week. 

   [3] Exhibit R1, page 58.

8. Mr Gibbons said that he believed his daughter was being penalised because she was regarded as a job seeker and was therefore subject to a less generous income free area for youth allowance rate purposes.  If she had been regarded as a full-time trainee, the income free area in respect of her earnings would have been more generous.  In addition, Ms Gibbons said it was necessary for her to look for other work in her free time when not at State Tennis.  This was not feasible as no employer would contemplate employing her on that basis because she could not guarantee when she would be available for work. 

9. Mr Gibbons submitted that his daughter’s employment arrangements with State Tennis had “fallen through the crack”, and this was unfair to her.

   CONSIDERATION

   Is the applicant a “new apprentice” under the definition of that expression in the Act?

10. Section 23 of the Act defines a “new apprentice” as:

    “A person who has a current Commonwealth registration number in relation to a full-time apprenticeship, traineeship or trainee apprenticeship under the scheme known as New Apprenticeships, but does not include a person whose registration number is suspended.”

11. The expression “full-time apprentice” is not defined in the Act. However, the words “full-time basis” were considered by von Doussa J in the Federal Court in Lane and Ors v Arrowcrest Group Pty Ltd[4]where, at 452 he said:

    “The words “full-time basis” … when given their ordinary and natural meaning refer to the amount of time which the employee is devoting to his employment.  Ordinarily, whether a person is engaged in a pursuit on a “full-time basis” is a question of fact which involves judgments of degree to be decided in all the circumstances.  A person will be so engaged if, during the relevant period, the person applies so much time to the pursuit that his or her commitment is full-time in the ordinary meaning of those words. …”

    [4] (1990) 27 FCR 427.

12. In my view, Ms Gibbons’ employment under her varied contract was not “full-time”. From 21 January 2013, she was employed with State Tennis on a part-time basis of 24 hours per week, not full-time, which would have been approximately 36 hours per week. Given the definition in s 23 of the Act, it is clear that Ms Gibbons was not a “new apprentice”, and s 1067G of the Act must be read accordingly.

    Should the applicant’s “income free area” in respect of her earnings under the youth allowance rate calculator be as a “new apprentice” or as a “job seeker”?

13. As Ms Gibbons did not satisfy the definition of “new apprentice” in s 23 of the Act, the provisions of s 1067G-H29 must be read literally, such that paragraphs (aa) and (a) do not apply, but paragraph (b) applies. Thus, Ms Gibbons’ ordinary income free area becomes $143.00 per fortnight, rather than $400.00 a fortnight.

14. It was clear that Mr Gibbons did not accept the decision I reached in his daughter’s case. He inferred that the respondent should have done more work to ensure that his daughter was protected so that she could be treated as a “new apprentice”, rather than a “job seeker”. If this was done, s 1067G-H29 could be interpreted favourably for his daughter. He also inferred that I should adopt a moralistic reading of s 23 and s 1067G-H29 of the Act. In particular, I should exercise a discretion to allow the Act to be interpreted in his daughter’s favour. Unfortunately, the relevant provisions of the Act simply do not allow me to do this.

15. I have sympathy for the situation in which Ms Gibbons finds herself.  Mr Gibbons discussed the possibility of “Act of Grace” and “ex gratia” payments being available to his daughter.  The availability of or the entitlement to these payments is not within the Tribunal’s influence.  In this regard, I encourage Ms Gibbons to obtain the relevant material relating to the payments and to explore the possibility of obtaining any benefit that the arrangements may offer.

    DECISION

16. The Tribunal affirms the decision under review.

I certify that the preceding 16 (sixteen) paragraphs are a true copy of the reasons for the decision herein of Senior Member R W Dunne

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Administrative Assistant

Dated 23 June 2014

Date(s) of hearing	16 May 2014
Advocate for the Applicant	Mr W Gibbons
Advocate for the Respondent	Mr C Visser
Solicitors for the Respondent	Department of Human Services