Linda Davis v RMIT University Student Union
[2010] FWA 9968
•30 DECEMBER 2010
Note: An appeal pursuant to s.604 (C2011/3078) was lodged against this decision - refer to Full Bench decision dated 7 April 2011 [[2011] FWAFB 1992] for result of appeal.
[2010] FWA 9968 |
|
REASONS FOR DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Linda Davis
v
RMIT University Student Union
(U2010/1446)
SENIOR DEPUTY PRESIDENT KAUFMAN | MELBOURNE, 30 DECEMBER 2010 |
Fixed term contract - effect of employment continuing after expiration of term - offer and acceptance - whether termination at initiative of employer - harsh, unjust and unreasonable.
[1] Ms Linda Davis has made an application for an unfair dismissal remedy pursuant to s 394 of the Fair Work Act 2009. She alleges that the termination of her employment by the RMIT University Student Union (RUSU) was unfair and seeks an order that she be reinstated to her former position.
[2] The facts are relatively uncontroversial and can be shortly stated.
[3] In 2008 Ms Davis was employed by an employment agency to perform work for RUSU. She was initially employed on a four month contract and this was extended by approximately three months. The reason for Ms Davis’ employment was that the Payroll/Finance Officer, Ms Rina Lee, a permanent employee of RUSU, was temporarily absent, apparently due to illness or injury.
[4] On about 31 March 2009 Ms Davis was offered, and she accepted, a six month contract by RUSU. In contrast to the earlier employment, she was now directly employed by RUSU. The offer was made by a letter from RUSU over the signature of its then General Secretary. 1 Although it sought Ms Davis’ confirmation, there was no request that the confirmation be in writing, and it appears that there was no written confirmation. Ms Davis continued to work at RUSU, as a Finance Officer. It is worth observing that the offer was for “a temporary 6 month contract with the potential of conversion to permanent employment at the end of the 6 month period.”
[5] On 2 October 2009, shortly prior to the expiration of her temporary contract, Ms Davis received an email from the then President of RUSU advising her that subject to the approval of the “secretariat” the staffing committee had determined to extend her contract for a further six months to approximately 6 April 2010. 2 By way of acceptance, Ms Davis placed a record of the email on “the staff member file”.3 The reason for the extension of Ms Davis’ contract was that the position of Ms Lee was still unclear. It is uncontested that Ms Davis accepted the extension of her contract and continued in her position.
[6] On 7 April 2010 RUSU, over the signature of Tom Ayers, the 2010 General Secretary, offered Ms Davis a further extension of her “current contract ... due to the lack of clarity surrounding a staff member and their extended leave.” 4 The staff member to whom Mr Ayers was referring was Ms Lee. On 12 April 2010 Ms Davis accepted the offer by signing a copy of the letter. The extension was for a further two months from 7 April to 7 June 2010.
[7] In his letter Mr Ayers referred to the RMIT Student Union Enterprise Agreement 2003 (the Agreement) and to its provision in clause 2.3.3.1 that “no temporary position shall exceed twelve months unless replacing a staff member who is on leave for a period longer than 12 months”. As Ms Lee’s absence had extended beyond 12 months, the extension of Ms Davis’ contract appeared to be contemplated by clause 2.3.3.1.
[8] Despite the terms of the Agreement, by letter dated 3 June 2010, sent by email and received by Ms Davis on 8 June whilst she was on leave, RUSU, again over the signature of Mr Ayers, offered her a further two month extension of her contract (the June offer). Whilst the author acknowledged that “the issues surrounding the finance staff member and their extended leave” had been resolved, there were, “still issues we need to resolve in terms of the Finance department.”
[9] Ms Davis was not inclined to accept this last extension of her contract. She contends that as a consequence, when she returned from leave on 15 June 2010, her employment, from that point on, was not on a temporary fixed term basis until 8 August 2010, but rather on an indefinite continuing basis.
[10] RUSU followed up its offer, both by phone and email, seeking Ms Davis’ acceptance of the offer and Ms Davis sent an email to Mr Ayers on 12 June 2010, whilst she was on leave, asking to discuss the offer on her return to work.
[11] On her return on 15 June Ms Davis told Mr Ayers that she would not sign the contract because “the new terms offered were contrary to the previous terms and undertakings that the position would be made permanent once Rina’s [Lee] employment was finalized.” Although Ms Davis said that Mr Ayers did not reply 5, I prefer Mr Ayer’s evidence to the effect that he told Ms Davis to speak with Ms Mandi Scott, RUSU’s Governance and Development Officer and one of its few permanent employees, or Ms Emma Henderson, the 2010 President of RUSU.6 Ms Davis did not speak with Ms Scott or Ms Henderson as requested.
[12] Ms Davis continued in the role of Finance Officer on her return from leave on 15 June 2010. On 7 July 2010 she emailed Ms Henderson and Ms Scott, pointing out the terms of clauses 2.2.3.1 and 2.2.3 of the Agreement asked:
“Can you please organise as Motion 1 for the next Staffing Com to be held ASAP, and confirm that my position as Finance Officer will be changed from temporary to permanent.
On a personal note please understand that I have endured this position at great personal duress with the ongoing temporary contracts and promises (outside the EBA) with the understanding that job security and my rights under the EBA would be upheld once Rina’s employment was finalised.” 7
[13] The Staffing Committee met on 13 July 2010, discussed Ms Davis’ request, but resolved to preserve the status quo and to institute a review into the finance department. 8 The resolution was relayed to Ms Davis by Ms Henderson on 14 July9 and confirmed by her in a letter of 2 August 2010 wherein the terms of the Staff Committee motion were set out and an offer was made to extend Ms Davis’ “temporary employment for a further period of four months in order for the review to proceed. This would extend the expiry date of your employment from 8 August to 8 December 2010.”10
[14] Ms Henderson sought a reply by 6 August 2010. 11 When nothing had been received by 5 August, Ms Henderson followed up with an email asking that Ms Davis “formally respond to the Student Union’s offer to extend your temporary employment for an additional period of four months (to allow for the current review). As you are aware your employment will expire on [Sunday] 8 August 2010.”12
[15] On 10 August Ms Henderson telephoned Ms Davis requesting a meeting the following day, but Ms Davis was unavailable. On 11 August Ms Henderson sent Ms Davis an email seeking a meeting on 12 August, to which Ms Davis responded, also on 11 August, that she was seeking NTEU representation. The NTEU is the National Tertiary Education Union.
[16] On 12 August 2010 Ms Henderson, by email, again sought a response to the offer from Ms Davis. Ms Davis replied asserting; “as you seem to be unaware I have been employed with the Student Union on a continuous basis since 8th June, 2010.” This elicited a response from Ms Henderson on the same day outlining the recent chronology of events from her perspective, disavowing any “misapprehension that your employment is continuing in the absence of an agreement to extend it for a further term.” And advising Ms Davis that “if no agreement to an extension is made, then RSU will treat the employment as having expired effectively on 8 August.” 15
[17] There then followed several emails between Ms Henderson, Ms Davis and her union representatives, which culminated in a meeting on 26 August to discuss RUSU’s offer.
[18] On 27 August Ms Henderson sent an email to Ms Davis again seeking a response to the 2 August offer. Ms Henderson asserted that neither she, nor anyone else, had given Ms Davis an undertaking that her current temporary role had become permanent. She added that RUSU would not agree to make Ms Davis’ role permanent other than in accordance with the terms of the Agreement whereby she would be guaranteed consideration for the permanent role. Ms Henderson did, however, undertake that there would be no further extensions of Ms Davis’ temporary employment as it was the intention of RUSU to finalize the positions in the finance department. 16
[19] Ms Davis replied by email on 31 August 2010 asserting that, on advice from the NTEU it was her understanding that she was employed in an ongoing position and that she was not required to sign a further fixed term contract.
[20] On 2 September 2010 RUSU sent Ms Davis a letter advising her that her employment had expired “(formally with effect from 8 August 2101)”. Ms Davis was paid up to 2 September 2010 and received all her entitlements to that date.
[21] The jurisdictional issue that arises is whether the termination of Ms Davis’ employment was on the employer’s initiative as required by s 386(1)(a) of the Act in order that an application for a remedy may be made.
[22] Ms L Gale of the NTEU, who appeared for Ms Davis, submitted that Ms Davis had been employed on an ongoing basis from 8 June 2010. The submission was put on the basis that from the time of Ms Davis’ return from leave on 15 June 2010 she had made it clear that she was no longer prepared to be employed on a fixed term basis. It is said that this is evidenced by, amongst other things, the requirement in the Agreement that no temporary position should exceed twelve months unless replacing a staff member who is on leave for a period longer than twelve months. Ms Davis had been employed since 6 April 2009, thus by the time she was offered another fixed term engagement in June 2010 she had been employed for well in excess of twelve months. Further, Ms Lee was no longer employed and the proviso in clause 2.2.3.1 did not apply. It was also submitted that Ms Davis’ had had an expectation, based on the representations of RUSU that once Ms Lee’s situation had been regularized, she would be made a permanent employee. Further, she had told Mr Ayers, her immediate supervisor, on her return to work that she would not sign the 3 June 2010 offer.
[23] Although Ms Gale did not submit that Ms Davis had been appointed as a permanent employee under the provisions of the Agreement, she contended that, on Ms Davis’ return to work on 15 June 2010, she was engaged “subject to ordinary weekly employment until the situation was otherwise resolved.” 17 She also submitted that the fact of Ms Davis being granted a period of leave that would transcend the expiration of her 7 April to 7 June 2010 fixed term contract is indicative of her employment having become ongoing at the expiration of that contract. Additionally, she submitted that as Ms Davis had returned to work, performed her work and continued to be paid for her work the “general principle of employment law that if, without expressly extending the term of the contract, the employment continues beyond the expiry of the fixed term, a new contract has commenced and the term of employment will become indefinite.”18
[24] I do not accept Ms Gale’s submission that from 8 June 2010 Ms Davis had been employed on an ongoing basis. This was not a mere continuation of the employment beyond a fixed term such as might have led to an inference that the employment had become indefinite. Here, the employer had made it clear that it was offering Ms Davis a further period of employment for a fixed term until 8 August 2010. Ms Davis’ telling Mr Ayers that she would not sign the contract, did not, in my view, amount to a rejection of RUSU’s offer. There were the previous fixed term contracts which were not evidenced by her signature. In any event, I am satisfied that normally Ms Davis dealt with Ms Scott and/or Ms Henderson in relation to such matters. I accept, as contended for by RUSU, that had Ms Davis told them that she was not accepting the 3 June offer and considered that she was either permanent or ought be made permanent they would not have acquiesced. Ms Davis made no counter offer. Ms Davis was aware of the terms of the Agreement and she must be taken to have known that her employment could not be made permanent; all that she could have hoped for was that she would be considered for the appointment to the position. 19 Significantly, her email of 7 July asking that RUSU “confirm that my position will be changed from temporary to permanent”20 (my emphasis) strongly suggests that when she returned to work on 15 June she had indeed accepted that she was returning on a fixed term contract until 8 August 2010. That was what she was offered and that she accepted that offer is evidenced by her conduct.
[25] Having found that Ms Davis was employed on a fixed term contract from 8 June 2010 to 8 August 2010 is not determinative of the status of her employment at the time of its termination on 2 September 2010. Ms Gale submitted that even were I to find as I have, there can be no suggestion that from 8 August until 2 September 2010 Ms Davis was employed on a fixed term contract. This submission is correct so far as it goes, but it does not mean, as Ms Gale contended, that Ms Davis’ employment from 8 August was of an ongoing indefinite nature.
[26] As is evident from my recital of the facts, the period from 2 August, when the offer of a four month extension to 8 December was made, until the termination of Ms Gale’s employment on 2 September 2010 was largely devoted to negotiations between RUSU and Ms Davis as well as her union representatives about whether or not she would accept the 2 August offer of an extension of her contract from 8 August to 8 December 2010. 21 It is clear that RUSU was not offering Ms Davis anything other than a fixed term contract of employment. It was not offering her ongoing employment nor was it offering her permanent employment. During that period RUSU was seeking a response from Ms Davis to its offer of a fixed term contract and Ms Davis was seeking the assistance of the NTEU before she would respond. It was not until her email of 31 August 2010 wherein she asserted she was employed in an ongoing position and was not required to sign a further fixed term contract that RUSU was finally advised that she would not accept the offer of a further fixed term contract. It was upon receipt of that email that RUSU responded that given that its only offer had been a fixed term contract and that had been rejected, it advised Ms Davis that “[i]n accordance, therefore, with the position RSU has clearly stated, I advise that your employment has expired (formally with effect on 8 August 2010).”22
[27] In her written submissions Ms Gale referred to a number of cases on what happens at the expiration of a fixed term contract and whether the termination of the employment relationship subsequent thereon is termination at the initiative of the employer. Those cases are of little assistance in the circumstances of this matter because the employment did not just continue after the expiration of the term; it only continued whilst negotiations as to its continuation were taking place and ended when no agreement was reached.
[28] Whilst the passage in D’Ortezio 23, upon which RUSU sought to rely, confirms my view that there was a fixed term contract for the period 8 June to 10 August 2010, an application of the principles there elucidated does not go so far as to persuade me, as contended for by RUSU, that by her having continued to work after 8 August, Ms Davis had accepted the offer of another fixed term contract expiring on 8 December 2010. Such a conclusion does not appear to be open in the face of Ms Davis’ conduct.
[29] However, it is difficult to see how it can be said, as a matter of law, that the employment had assumed the character of ongoing or open ended employment in the face of RUSU offering Ms Davis only a fixed term contract and insisting that it was only prepared to employ her on that basis. There are no strongly countervailing factors as was the case in D’Lima, 24 upon which Ms Gale sought to rely. Applying normal principles of contract law, it can be seen that RUSU’s offer was of a fixed term contract. I accept RUSU’s categorization of the agreement as being one, reached prior to 8 August 2010, that Ms Davis would be afforded such time as was reasonably necessary to obtain union advice and respond to that offer, and that she would continue to work during that period. Ms Davis finally rejected this offer on 31 August by contending that she was already an ongoing employee. In my view, that rejection cannot be characterized as a counter offer.
[30] Thus, Ms Davis’ employment continued from 8 August until 2 September 2010.
[31] It seems to me, whatever the nature of the employment from 8 August until 2 September 2010, Ms Davis was a person protected from unfair dismissal at 2 September 2010, within the meaning of that expression in s 382 of the Act.
[32] Section 386 deals with the meaning of “dismissal”. Having found that Ms Davis was not engaged under a contract of employment for a specified time, the saving in s 386(2) does not apply. I do not accept the submission of Mr J Pesutto, who appeared for RUSU, that for the period from 8 August 2010 Ms Davis had been employed for a specified task until the issue of her employment status had been resolved, nor that a period of employment had been specified so that it could be said that she had been employed under a contract of employment for specified period of time. The time of this particular period had clearly not been specified, albeit that it may be inferred, as Mr Pesutto submitted, that the period would end either when an agreement had been reached or when agreement was unable to be reached.
[33] This then leads to a consideration of whether Ms Davis’ employment had been terminated on the employer’s initiative so as to enliven the jurisdiction of Fair Work Australia. Because there were no express terms governing the employment relationship that commenced with the expiration of the 8 June to 8 August fixed term contract, it is necessary to find those terms by inference. I have already described what I found to be the terms of the contract; it, and Ms Davis’ employment would terminate if she did not accept RUSU’s offer.
[34] When, on 31 August 2010, Ms Davis rejected RUSU’s offer that rejection brought her employment to an end in accordance with the terms of the contract. In my view, Ms Davis’ employment ended by operation of the implied terms of the contractual relationship that was in force from 8 August 2010. RUSU’s letter of 2 September merely acknowledged what had occurred.
[35] It follows that there was no termination on the employer’s initiative.
[36] Even if I am wrong and Ms Davis employment was terminated at RUSU’s initiative, in my view, the termination was not unfair.
[37] It should be remembered that RUSU is a small organization, largely staffed by elected student representatives. In having regard to the “fair go all round” principles enshrined by s 381(2) of the Act, I have regard to that fact as well as the entitlement that Ms Davis had to be treated appropriately as an employee. It was submitted on her behalf that by not offering her ongoing employment RUSU had breached the Agreement. I doubt that this submission is correct. At its highest, once the Rina Lee situation had been resolved, the Agreement required that Ms Davis be considered for the position of Finance Officer, which might include being re-interviewed, prior to the vacancy being advertised. Given the intention of RUSU that a review of the structure be undertaken and completed within four months, it is difficult to see how she could have been realistically considered for the position. In her letter of 2 August 2010, Ms Henderson pointed out that the review would almost certainly result in different position descriptions for the roles in the finance department.
[38] Ms Davis at all times knew that the only offer was that of a further four month fixed term contract from 8 August to 8 December 2010. She knew the reason for it; the proposed review of the organizational structure. It was she who sought time after the offer was made on 2 August to consult her union. It was she who rejected the offer on 31 August 2010. To have appointed Ms Davis in some sort of ongoing position so that she might have the benefits afforded to a permanent employee by the Agreement would have placed an unconscionable burden on RUSU. I reject Ms Gale’s submission that by not doing precisely that RUSU acted unfairly.
[39] It follows that, in the event that there was a termination of Ms Davis’ employment, contrary to my conclusion on that issue, it was for a valid reason. I have also taken into account the other matters referred to in s 387, and in the circumstances of this case do not need to specifically refer to them. In my view, if there was a termination of Ms Davis’ employment at the initiative of RUSU, it was for a valid reason, it was not harsh, unjust or unreasonable and was not unfair.
[40] Ms Davis’ application for a remedy must be dismissed.
SENIOR DEPUTY PRESIDENT
Appearances:
L Gale for the applicant.
J Pesutto for the respondent.
Hearing details:
2010
MELBOURNE
8 DECEMBER
Final written submissions:
2010
15 December
2010
22 DECEMBER
1 Ex A1, Attachment 2
2 Ex A1, Attachment 4
3 Ex A1, paragraph 6
4 Ex A1 Attachment 5
5 Ex A1, paragraph 15
6 Ex R3, paragraph 6
7 Ex A1, Attachment 7
8 Ex R2, paragraph5
9 Ex R2, paragraph 6
10 Ex A1, Attachment 8
11 Ex A1, Attachment 8
12 Ex R2, Attachment, p.5
Ex A1, Attachment 1
Ex R2, paragraph 14 and Attachment p.6
15 Ex R2, paragrah15 and Attachment pp.7 - 9
16 Ex R2, paragrah15 and Attachment p.14
17 PN 880
18 NTEU Written Submissions filed on 15 December 2010
19 Ex A3, clause 2.2.3.2
20 Ex A1, Attachment 7
21 Ex A1, Attachment 8
22 Ex A1, Attachment 10
23 D’Ortenzio v Telstra [1997] FCA 1422
24 D’Lima v Board of Management of Princess Margaret Hospital for Children (1995) AILR 3-173
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