Mathew Armstrong v Bay Removals

[2014] FWC 5391

[2014] FWC 5391

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

Mathew Armstrong
v
Bay Removals
(U2014/7113)

COMMISSIONER HAMPTON ADELAIDE, 2 SEPTEMBER 2014

Application for relief from unfair dismissal - whether protected from unfair dismissal - minimum employment period - whether period of continuous service broken by termination - whether purported termination effective in all of the circumstances - whether potential for future employment maintained service - dismissal found - insufficient service - no jurisdiction - application dismissed.

1. Introduction and case outline

[1] Mr Matthew Armstrong has made an application to the Commission seeking a remedy for an alleged unfair dismissal. The application has been made under s.394 of the Fair Work Act 2009. Mr Armstrong’s employer was Bay Removals, which is a small furniture removal company.

[2] I am presently dealing with a preliminary jurisdictional issue; being in effect, whether Mr Armstrong is eligible to bring this application given the scope of the unfair dismissal jurisdiction as defined by the Act.

[3] It is common ground that Bay Removals is a small business within the meaning of the Act 1 and that in these circumstances it is necessary for Mr Armstrong to have completed at least 12 months of continuous service. This arises from s.382(a) and s.383(b) of the Act and unless this condition is met, Mr Armstrong was not protected from unfair dismissal by the terms of the legislation and is unable to bring this application.

[4] As a result, I need to determine whether Mr Armstrong has had at least 12 months of continuous service with Bay Removals at the time of his dismissal (the minimum employment period).

[5] Mr Armstrong was first employed by Bay Removals in or around July 2011 2 and the dismissal that prompted this application occurred in mid April 2014. Bay Removals contends that this involved two distinct and separate periods of employment with the second period commencing in mid November 2013. In particular, Bay Removals contends that the first period of employment concluded when Mr Armstrong was dismissed on or about 28 July 2013.

[6] Mr Armstrong contends that he was an employee throughout the period from his commencement until April 2014. He denies that he was dismissed in July 2013 and argues that he was merely sent home from work, and although not offered any work during the period between July and November 2013, he remained in an employment relationship with Bay Removals. This, he contends, should be treated as being continuous for present purposes, or at least, not such as to break his period of service.

[7] It is common ground that, for the period between Mr Armstrong’s commencement (July 2011) and 28 July 2103, he was employed as a casual employee who was regularly and systematically employed and had a reasonable expectation of employment. It is further agreed that the period of employment between 13 November 2013 and 17 April 2014 would also count as continuous service for present purposes. However, the “second period” is insufficient to meet the minimum employment period in its own right.

2. What is continuous service for the purposes of the minimum employment period?

[8] 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) However:

(a) a period of service as a casual employee does not count towards the employee’s period of employment unless:

(i) the employment as a casual employee was on a regular and systematic basis; and

(ii) during the period of service as a casual employee, the employee had a reasonable expectation of continuing employment by the employer on a regular and systematic basis; and

(b) ... ...”

[9] The meaning of the terms “Service” and “Continuous service” are relevantly defined by the Act as follows:

“22 Meanings of service and continuous service

General meaning

(1) A period of service by a national system employee with his or her national system employer is a period during which the employee is employed by the employer, but does not include any period (an excluded period) that does not count as service because of subsection (2).

(2) The following periods do not count as service:

(a) any period of unauthorised absence;

(b) any period of unpaid leave or unpaid authorised absence, other than:

(i) a period of absence under Division 8 of Part 2-2 (which deals with community service leave); or

(ii) a period of stand down under Part 3-5, under an enterprise agreement that applies to the employee, or under the employee’s contract of employment; or

(iii) a period of leave or absence of a kind prescribed by the regulations;

(c) any other period of a kind prescribed by the regulations.

(3) An excluded period does not break a national system employee’s continuous service with his or her national system employer, but does not count towards the length of the employee’s continuous service.

(3A) Regulations made for the purposes of paragraph (2)(c) may prescribe different kinds of periods for the purposes of different provisions of this Act (other than provisions to which subsection (4) applies). If they do so, subsection (3) applies accordingly.

... ...”

[10] The concept of a stand down as referred to in s.22(2)(b)(ii), as it might apply under Part 3-5 of the Act, is not relevant to the present circumstances. 3 I will consider whether the concepts of authorised absence and unpaid leave are relevant as part of my consideration of the substantive issues.

[11] The operation of the relevant provisions has been considered by a Full Bench in Wayne Shortland v The Smiths Snackfood Co Ltd 4 (Shortland) in the following terms:

“[10] As a matter of the common law of employment, and in the absence of an agreement to the contrary, each occasion that a casual employee works is viewed as a separate engagement pursuant to a separate contract of employment. Casual employees may be engaged from week to week, day to day, shift to shift, hour to hour or for any other agreed short period. In this sense no casual employee has a continuous period of employment beyond any single engagement. Moreover, it is common for a casual employee to transition between a period in which their engagements with a particular employer are intermittent and a period in which their engagements are regular and systematic and vice versa. It is against that background that s.384 must be construed.

[11] The criteria in s.384(2)(a) make it clear that s.384 does not proceed on the basis that a casual employee’s period of employment for the purposes of the unfair dismissal remedy starts and ends with each engagement as understood in the common law of employment.

[12] Moreover, it is more than tolerably clear that s.384 is concerned with how an employee’s period of employment is calculated for the purposes of s.382(a). Section 384(2) draws a distinction between a period of service and a period of employment. It also draws a distinction between a period of continuous service and a period of service: a period of continuous service can be made up of a series of periods of service, some of which count towards the period of continuous service (ie. where the conditions in s.384(2)(a)(i) and (ii) are met) and some of which do not (ie. where one of the conditions in s.384(2)(a)(i) or (ii) is not met). It is clear from the language of s.384(2) that an employee may have series of contiguous periods of service with an employer that may count towards a single period of employment with that employer. Any given period of service in such a contiguous series of periods of service will count towards the employee’s period of employment only if the requirements in s.384(2)(a)(i) and (ii) are met. Section 384(2) is concerned only with determining which periods of service in such a contiguous series count toward the employee’s period of employment with the employer for the purposes of s.382(a).

[13] Continuous service by a casual employee who has an established sequence of engagements with an employer is broken only when the employer or the employee make it clear to the other party, by words or actions that there will be no further engagements. The gaps between individual engagements in a sequence of engagements should not be seen as interrupting the employee’s period of continuous employment within the meaning of s.384. In particular, a period of continuous service within the meaning of s.384(1) is not to be seen as broken by a period of ‘leave’ or an absence due to illness or injury.”

[12] In all of the circumstances of this case I will need to consider and determine the following major issues:

● Was Mr Armstrong terminated by Bay Removals on or about 28 July 2013; and depending upon that conclusion -
● Would the period between 28 July and November 2013, when no actual work was being performed, break the period of continuous service for Mr Armstrong?

3. The evidence before the Commission

[13] Bay Removals relies upon evidence of the following:

● Mr Keith Rigg - Sole proprietor and owner of Bay Removals; and
● Mr William Greene - Operations Manager with Bay Removals between August 2011 and 12 November 2013.

[14] Mr Armstrong gave evidence and relied upon the testimony of Mr Zed Every, who was an employee who worked for Bay Removals during the period leading up to and following the events of 28 July 2013.

[15] I found Mr Greene to be a forthright and honest witness and I accept his evidence on the key facts where it conflicts with any other version of the events. I have reached this conclusion allowing for the fact that at some stages of his employment he may have suffered short-term temporary memory loss as a result of an illness he was suffering at the time. Importantly, this did not affect his recall of the substance of the events of 28 July 2013 and importantly, his version of the critical factual matters in dispute was largely endorsed by Mr Every.

[16] I have some reservations about the evidence of Mr Rigg, Mr Armstrong and Mr Every. I do not consider that they attempted to mislead the Commission, however it was evident to me that their perception of the justice of the situation influenced their evidence to a degree and this leads me to treat it with caution.

[17] Additionally, in terms of Mr Armstrong, his recall about the conversations with Mr Rigg that were said to have led to the continuation of his employment in the period between July and November 2013 was both inconsistent and poor.

4. Consideration

4.1 Was Mr Armstrong dismissed by Bay Removals on or about 28 July 2013?

[18] This in turn involves the consideration of three aspects given the positions contended by the parties:

● What was said during the exchange between Mr Greene and Mr Armstrong on 28 July 2013 and what was its effect?
● Did Mr Greene have the authority to dismiss Mr Armstrong?
● Were there later discussions between Mr Armstrong and Mr Rigg about the purported dismissal and did this change the status of that event?

[19] Bay Removals is a small removals company. It operates in an informal manner using manual diary entries to record bookings and log staff hours and related issues. It has external financial assistance and has little in the way of formal management structures or processes.

[20] Mr Rigg is the sole owner of the business and has the overriding authority to make decisions about its affairs. Mr Greene, who is a friend of Mr Rigg, but who has extensive experience in the industry in his own right, was engaged as Operations Manager in August 2011. It is evident that whilst Mr Rigg had ultimate authority, Mr Greene made the day to day employment decisions and effectively ran the business operations whilst he was there.

[21] Mr Armstrong was a casual employee in the relevant period and whilst the actual hours varied according to the amount of moving jobs, he was considered by Mr Greene to be a preferred employee and he regularly worked extensive hours. Work for the coming week was generally advised to Mr Armstrong in advance and confirmed the day before.

[22] At some stage, Bay Removals (or Mr Rigg) purchased a motor vehicle, in effect, on behalf of Mr Armstrong. There is a dispute about the precise circumstances leading to that outcome however it is not necessary for me to determine that issue. It is clear that as a result of the purchase, Mr Armstrong owed money to Bay Removals (or Mr Rigg personally), and that money was still outstanding in July 2013. I also note that Mr Armstrong has also sought some clarification about superannuation payments due to be made on his behalf and this issue was also outstanding in July 2013.

[23] Mr Greene suffered from health issues in 2013 and I find that this did impact upon his capacity to perform the job and led to some tensions with Mr Armstrong and other employees. The personal relationship with Mr Armstrong deteriorated in the lead up to the events on 28 July 2013 and when the applicant was late for work and appeared to Mr Greene to be uncooperative, the following exchange took place.

[24] Mr Greene raised his concerns with Mr Armstrong about being late and this was nonchalantly received. Mr Armstrong then went to sit in the passenger seat of the removal truck and when Mr Rigg advised him that he was expected to drive, he reluctantly got out and went to sit in the driver’s seat. Mr Greene became annoyed with Mr Armstrong and informed him that “we are done, this is over.” On balance I also find that Mr Greene informed Mr Armstrong that “You are finished” and when he went to get in his car and leave, Mr Greene demanded that Mr Armstrong return the work keys, which he did. 5

[25] Mr Greene subsequently informed Mr Rigg and the other employees that he had dismissed Mr Armstrong and wrote “sacked” in the work diary in an entry pointing to Mr Armstrong.

[26] Mr Armstrong did not subsequently return to the workplace, and was not offered any shifts, until late November 2013. This was reinforced in that period when Mr Every or another employee suggested to Mr Greene that Mr Armstrong be approached to assist on a particular job. Mr Greene confirmed that Mr Armstrong had been dismissed and would not be offered any further work. Leaving aside the issues of the authority of Mr Greene and any later discussion with Mr Rigg, the events of 28 July 2013 objectively represented a dismissal of Mr Armstrong. That is, the exchange and subsequent behaviour represented the words and actions to indicate that there would be no further engagements of Mr Armstrong by Bay Removals. 6

[27] I have considered the suggestion by Mr Armstrong that the alleged dismissal was a complete fiction designed to defeat this application. This he contended, was reinforced by the fact that the employer response 7 filed in this matter recorded “2010” in response to the question “1.2 What date did the Applicant begin working for you?”

[28] However, it is evident that Mr Rigg was not aware of the potential significance of the question in that he was unaware of the jurisdictional issue. Importantly, the question does not refer to “period of service” or other notions and although the reference to 2010 was probably intended to be 2011, the fact of Mr Armstrong having first worked with the employer from an earlier time is not in dispute. Most relevantly, the fact that Mr Greene attempted to dismiss Mr Armstrong is not seriously in dispute and is supported by the overwhelming weight of the evidence.

[29] It is also evident to me that Mr Greene had the authority to dismiss Mr Armstrong. Although Mr Rigg had the capacity to reverse such a decision, or to instruct Mr Greene to do otherwise, Mr Greene did not need approval in advance and his actions were capable of bringing the employment relationship with Mr Armstrong to an end.

[30] The remaining issue is the most difficult to determine given my concerns about the state of the evidence before the Commission. There was at least one discussion between Mr Rigg and Mr Armstrong in the immediate aftermath of the events of 28 July 2013. When pushed for details about what Mr Armstrong contends was said to lead to the expectation of ongoing and/or future employment, he referred to his “gut instinct” 8 and later said in evidence that “it was quietly spoken off... without saying the words, quietly confident... It was unspoken but it was spoken... it was clear that I would take over this position”.9

[31] There is also little in the surrounding circumstances that would assist me to determine the detail and import of that discussion.

[32] Bay Removals did not issue a separation certificate, and other than the payment for hours already worked, took no action to formalise the apparent dismissal. Mr Armstrong also took no action to contest his dismissal or apparently register with “Centrelink”. However, the evidence reveals that Bay Removals considers all employees to be casuals and does not issue any employment documentation on termination, unless requested, and was not obliged to make any further payments upon the conclusion of Mr Armstrong’s employment. In addition, Mr Armstrong took a relatively long overseas trip during this period and may not have been actively seeking work at that time in any event.

[33] There were also outstanding issues between the parties concerning a private debt owed to Bay Removals by Mr Armstrong associated with the motor vehicle and potential superannuation obligations. The fact that these were not brought to a head might be more consistent with the fact of ongoing employment. However, I note that these have not apparently been further discussed or resolved notwithstanding the resumption of active employment later in the year and the subsequent dismissal.

[34] I have also considered the fact that when Mr Greene did eventually leave the employment of Bay Removals, Mr Rigg immediately rang Mr Armstrong and offered him the job of Operations Manager, which he accepted and commenced the next day. This is consistent with the suggestion of arrangements being pre-arranged. However, there is an almost complete absence of any reliable evidence from Mr Armstrong about how and when this was arranged and Mr Rigg has denied that any such arrangements were expressly discussed prior to that time. The fact of the almost immediate resumption of employment is also consistent with there being a general expectation of future employment when an opportunity arose. This is reinforced by the fact that the terms and conditions of employment for the Operations Manager were already known by Mr Armstrong and others in the workplace and little if any negotiation of the detail would have been required at any point.

[35] In light of the evidence before the Commission and my views about such, I find that Mr Rigg had a discussion with Mr Armstrong on or shortly after 28 July 2013. This involved a discussion about the outstanding car payments but also involved acknowledgement of the dismissal of Mr Armstrong. Mr Rigg also indicated a desire to have him return to employment with Bay Removals when circumstances allowed. That is, it was evident that Mr Armstrong would not be offered any work whilst Mr Greene remained as the Operations Manager and Mr Rigg did not want to close the door on future employment opportunities for Mr Armstrong. However, because it was not known when and if Mr Greene would relinquish that role, there were no definite arrangements made. There was also some knowledge of this general expectation held by others in the workplace, including Mr Every.

[36] Accordingly, there was a general expectation of future employment when circumstances may permit that to occur, however the dismissal of Mr Armstrong by Mr Greene was not undone in any sense.

[37] I therefore find that Mr Armstrong was dismissed from his employment with Bay Removals on 28 July 2013.

4.2 Would the period between 28 July and November 2013, when no actual work was being performed, break the period of continuous service for Mr Armstrong?

[38] The findings above have largely determined this preliminary point. I have however considered the broader notions raised by Mr Armstrong given the general expectation, after 28 July 2013, that further employment might well occur at some future point.

[39] There is nothing in the relationship or dealings between the parties in the relevant period that might suggest that Mr Armstrong was on leave or that the absence was consistent with any contract of employment during that period. The only reliable evidence is that there was one discussion between Mr Rigg and Mr Armstrong following the dismissal and prior to the new job offer, and this has been dealt with above.

[40] The dismissal on 28 July 2013 concluded the employment relationship and quarantined that service from the later employment. The absence of any work was completely inconsistent with the regular and systematic casual employment undertaken by Mr Armstrong prior to 28 July 2013 and when he resumed employment with Bay Removals, it was in a different role with different requirements and working arrangements.

[41] On that basis, the continuity of Mr Armstrong’s employment and service was broken on 28 July 2013 and the service prior to that time is not relevant to the minimum employment period.

5. Conclusions

[42] Given my findings, Mr Armstrong has not completed the required minimum employment period and he was not protected from unfair dismissal at the point of making this application.

[43] The unfair dismissal application is therefore beyond the jurisdiction of the Commission and must be dismissed. An order 10 to that end is being issued with this decision.

Appearances:

M Armstrong on his own behalf.

I Milsom, solicitor, with permission 11 for Bay Removals.

Hearing details:

2014

Adelaide,

August 7.

<Price code C, PR554052>

 1   S.23(1) of the Act.

 2   There is some confusion about Mr Armstrong’s original commencement date with various references being made to 2009 (in the application), 2010 (in the response and some of the applicant’s further materials) and 2011 (in the evidence of the employer and some later materials). Nothing turns on this issue and I have accepted the evidence of Mr Rigg on this point as it was the only sworn direct evidence.

 3   S.524 and S.525 of the Act.

 4   [2010] FWAFB 5709.

 5   Sound recording of hearing at 12:37 and 14:22.

 6   In a manner contemplated by Shortland at [13].

 7   Form F3.

 8   Sound recording of hearing at 14.43.

 9   Sound recording of hearing 14.46.

 10   PR554422.

 11   Permission was given for the respondent to be represented in this matter under s.596(2)(a) of the Act having regard to the complexity of the matter including the import of the applicant’s contention that the dismissal was a complete fabrication.

Printed by authority of the Commonwealth Government Printer