Michael Bridge v Bicycle South Australia Inc T/A Bike SA

[2016] FWC 8512

[2016] FWC 8512

FAIR WORK COMMISSION

DECISION

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

Michael Bridge
v
Bicycle South Australia Inc T/A Bike SA
(U2016/7342)

DEPUTY PRESIDENT BARTEL ADELAIDE, 30 NOVEMBER 2016

Termination of Employment – extension of time to file unfair dismissal application.

[1] On 26 April 2016, Mr Michael Bridge (the applicant) was handed a letter headed “Termination of your employment by reason of redundancy” (the termination letter). Up to this time the applicant held the position of General Manager of Bicycle SA Pty Ltd T/A Bike SA (the employer). The termination letter included the following:

“As a result of the loss of significant government funding to the organisation, the position of General Manager is no longer required, regrettably this means your employment is now terminated.

…

Further, we are unable to find you an alternative position within the organisation and your employment will end immediately. We will require the immediate return of Bike SA’s property ….

Based on your length of service, your notice period is five weeks weeks [sic]. Instead of receiving that notice, you will be paid the sum equivalent to five weeks of your annual salary of $81,500, plus the redundancy entitlement set out below.

…

You will also be paid your accrued long service and annual leave entitlements, including superannuation, up to and including May 31 2016.

…”

[2] The applicant contacted Mr Anthony Kerin of Maurice Blackburn Lawyers that day and then met with him on 27 April 2016, at which time he provided a copy of the termination letter. The applicant instructed Mr Kerin to file an unfair dismissal application.

[3] Mr Kerin corresponded with the employer’s solicitor on 3 May 2016. No date of termination was mentioned in the correspondence but Mr Kerin referred to the applicant’s advice to him that “he had been made redundant.” Mr Kerin requested that he be provided with the reasoning behind the employer’s decision and relevant documentation.

[4] On 4 May the applicant sent an email to Mr Kerin attaching a copy of the Employment Separation Certificate provided by the employer, which identified the termination date to be 31 May 2016. The applicant queried this date with Mr Kerin, stating:

“The attached ESC from Bike SA indicates my employment ceases 31 May, by including the required 5 week notice period.

However, would not my employment in fact end on 26 April, the day I was made redundant? I was made to leave the office on that day, in effect disabling my capacity to work, to be employed.

Please clarify.”

[5] Mr Kerin advised the applicant that, “If they pay you in lieu it ceases at the final payment week. 21 days after that will be the time limit”.

[6] Also on 4 May 2016, the applicant received payment for accrued entitlements in accordance with the termination letter.

[7] The application for an unfair dismissal remedy was filed on 31 May 2016. The employer has objected to the application on the basis that it was filed outside the 21 day time limit. The matter proceeded ‘on the papers’ by way of written submission and affidavit material filed by the parties.

The statutory provisions

[8] Section 394 of theFair Work Act 2009 (the Act) establishes a 21 day time limit for filing an unfair dismissal application and also sets out the basis on which the Fair Work Commission (the Commission) may allow a further period within which to file the application, as follows:

“394 Application for unfair dismissal remedy

(1) A person who has been dismissed may apply to the FWC for an order under Division 4 granting a remedy.

Note 1: Division 4 sets out when the FWC may order a remedy for unfair dismissal.

Note 2: For application fees, see section 395.

Note 3: Part 6-1 may prevent an application being made under this Part in relation to a dismissal if an application or complaint has been made in relation to the dismissal other than under this Part.

(2) The application must be made:

(a) within 21 days after the dismissal took effect; or

(b) within such further period as the FWC allows under subsection (3).

(3) The FWC may allow a further period for the application to be made by a person under subsection (1) if the FWC is satisfied that there are exceptional circumstances, taking into account:

(a) the reason for the delay; and

(b) whether the person first became aware of the dismissal after it had taken effect; and

(c) any action taken by the person to dispute the dismissal; and

(d) prejudice to the employer (including prejudice caused by the delay); and

(e) the merits of the application; and

(f) fairness as between the person and other persons in a similar position.”

Submissions

[9] Mr Kerin does not concede that the application is out of time and maintains that the termination date was 31 May 2016. He argued that if the Commission determines that the termination date was 26 April 2016, then there are exceptional circumstances to warrant an extension of time. These circumstances include that:

• The delay was occasioned by representative error and the applicant was blameless for the delay;



• The respondent misrepresented the date of termination on the Employment Separation Certificate and it cannot be said that the applicant knew at all relevant times that his dismissal date was 26 April 2016;



• The respondent has not asserted that it is prejudiced as a result of the delay;



• The extent of the delay is not significant;



• The applicant’s claim is highly meritorious. The applicant disputes that there was a genuine redundancy and argues that his dismissal arose out of a dispute with the employer.

[10] Ms Margaret Kaukas, for the respondent, submitted that:

• The applicant knew and understood that his employment was terminated on 26 April 2016. The terms of the termination letter were clear as to the date his employment ended;



• The applicant corresponded with the employer on 27 and 28 April 2016 and attended the workplace to retrieve personal material from his work phone and personal computer;



• The applicant received his termination entitlements on or before 4 May 2016 including pay in lieu of notice, and this must have indicated that the employment relationship had been severed;



• The applicant is required to provide a credible explanation for the period of the delay (14 days) but all circumstances since the dismissal need to be considered. There is no evidence that the applicant accepted Mr Kerin’s advice that the termination date was 31 May 2016;



• The argument of representative error goes only to the reason for the delay, and of itself does not constitute an exceptional circumstance;



• The separation certificate contained an administrative error concerning the termination date. It is implausible that the applicant would rely on this when the Certificate was dated 4 May 2016 and identified that pay in lieu of notice had been made to the applicant on 27 April 2016;



• All matters in s.394(3) of the Act need to be considered. In this regard the employer does not argue that it has suffered prejudice as a result of the delay and concedes that the applicant sought legal advice the day after he received the termination letter. However the employer submitted that the merit of the application was poor. The basis of the decision to make the applicant redundant has been disclosed to Mr Kerin and arose from a loss of government funding and a decision that the Chief Executive Officer would absorb the General Manager’s role. The employer is a small organisation 1 and there were no alternative positions available for the applicant;



• If the Commission determines that the date of dismissal was 31 May 2016, then the application has not been made within the 21 day period, which commences the day after the dismissal takes effect.

The date of termination

[11] Mr Kerin’s view of the date of termination was informed by two matters: the date of termination identified on the Employment Separation Certificate and the payment to the applicant of accrued entitlements to 31 May 2016.

[12] The error in the Employment Separation Certificate is unfortunate. At the least it would be reasonable to expect that Mr Kerin would have raised the obvious discrepancy between this document and the termination letter with the employer.

[13] The payment of accrued entitlements to 31 May 2016 appears to be a benefit accorded to the applicant which was not legally required. 2 Nonetheless this payment was set out in the termination letter and needed to be read in the context of the letter as a whole, not isolated from the definitive statements that indicated that the termination took immediate effect.

[14] It appears that Mr Kerin ignored these statements. That he would advise the applicant that, “If they pay you in lieu it ceases at the final payment week. 21 days after that will be the time limit”, indicates that he does not understand the concept of pay in lieu of notice. This is a concern.

[15] I have no hesitation in concluding that the date of termination was 26 April 2016. The letter of termination is unambiguous and the payment to the applicant of his accrued entitlements and pay in lieu of notice on or before 4 May 2016 is inconsistent with a termination date of 31 May 2016. While it is unnecessary to traverse the relevant case law to determine the date of termination, the following observation of Deputy President Sams in Micallef v Garfield Child Care Pty Ltd T/A Garfield Child Care 3 has some resonance:

“…, it cannot seriously be put that a payment made by an employer, in lieu of notice, still means the employment remains on foot until the notice period expires. Such a proposition is nonsense and cannot withstand scrutiny….”

Should an extension of time be granted?

[16] The parties referred to various cases involving an extension of time application which was grounded, at least in part, on representative error. I have had regard to these decisions, but the most helpful in my view is that of Robinson v Interstate Transport Pty Ltd (Robinson). 4 This is a decision of a Full Bench of Fair Work Australia (FWA) on appeal from the decision at first instance refusing to grant an extension of time. The extension of time was sought in relation to a general protections application under s.365 of the Act. The considerations required to be taken into account in considering the application are set out in s.366(2) of the Act as follows:

“366 Time for application

(1) An application under section 365 must be made:

(a) within 21 days after the dismissal took effect; or

(b) within such further period as the FWC allows under subsection (2).

(2) The FWC may allow a further period if the FWC is satisfied that there are exceptional circumstances, taking into account:

(a) the reason for the delay; and

(b) any action taken by the person to dispute the dismissal; and

(c) prejudice to the employer (including prejudice caused by the delay); and

(d) the merits of the application; and

(e) fairness as between the person and other persons in a like position.”

[17] It can be seen that s.366(2) includes the same considerations as s.394(3) of the Act, save that “whether the person first became aware of the dismissal after it had taken effect” in s.394(3)(b) of the Act, is not a consideration.

[18] The Full Bench in Robinson cited with approval the decision in Clark v Ringwood Private Hospital (Clark’s Case) 5 and stated that representative error, in circumstances where the applicant was blameless, would constitute exceptional circumstances subject to consideration of the matters in s.366(2)(b) to (e) of the Act. The Full Bench then set out a summary of Clark’s Case as contained in Davidson v Aboriginal and Islander Child Care Agency6as follows:

“In Clark the Commission decided that the following general propositions should be taken into account in determining whether or not representative error constitutes an acceptable explanation for delay:

(i) Depending on the particular circumstances, representative error may be a sufficient reason to extend the time within which an application for relief is to be lodged.

(ii) A distinction should be drawn between delay properly apportioned to an applicant’s representative where the applicant is blameless and delay occasioned by the conduct of the applicant.

(iii) The conduct of the applicant is a central consideration in deciding whether representative error provides an acceptable explanation for the delay in filing the application. For example it would generally not be unfair to refuse to accept an application which is some months out of time in circumstances where the applicant left the matter in the hands of their representative and took no steps to inquire as to the status of their claim. A different situation exists where an applicant gives clear instructions to their representative to lodge an application and the representative fails to carryout those instructions, through no fault of the applicant and despite the applicant’s efforts to ensure that the claim is lodged.

(iv) Error by an applicant’s representatives is only one of a number of factors to be considered in deciding whether or not an out of time application should be accepted.”

[19] In the present case, it is patently clear that Mr Kerin incorrectly advised the applicant of his termination date. The applicant had sought clarification from Mr Kerin and in my view cannot be criticised for accepting the advice given. He does not practice in industrial law and it is not unreasonable that he relied on Mr Kerin’s advice. Unlike some cases where the representative error concerns “indifference to the legislative time frames” 7 in this case Mr Kerin misadvised the applicant as to the law and adopted a casual indifference to all the indicators of the actual termination date spelt out in the termination letter and the payments received by the applicant. Mr Kerin latched on to the date of termination in the Employment Separation Certificate to the exclusion of the very fact that it was an Employment Separation Certificate.

[20] The applicant sought advice concerning his termination at the earliest opportunity and gave instructions to Mr Kerin to file an unfair dismissal application. Having been advised that the termination date was 31 May 2016, there was nothing more that the applicant could be reasonably expected to have done – as far as he understood, based on his legal advice, his application was filed within time. In these circumstances I consider that the applicant was blameless for the delay.

[21] In relation to the matters required to be taken into account under ss.394(3)(b), (c) and (d) and (f) of the Act, I find as follows:

• The applicant became aware of the dismissal on 26 April 2016 but was given legal advice that it came into effect on 31 May 2016;



• The applicant took action to dispute the dismissal;



• There is no submission of prejudice to the employer as a result of the delay or otherwise;



• Fairness as between the applicant and other persons in the same position is a neutral consideration in this matter.

[22] Consideration of the merits of the application is more difficult. The sum total of the information from Mr Kerin is that the application is “highly meritorious” and that the dismissal was not a genuine redundancy but was motivated by a dispute raised by the applicant. In contrast, the employer has provided a copy of Ms Kaukas’ detailed response to Mr Kerin’s request of 3 May 2016, to which were attached minutes of the employer’s Executive Committee Meetings of 21 April and 25 April 2016 and a memorandum from the Chief Executive Officer to the Executive Committee on 18 April 2016. This memorandum outlined the loss of government funding, its implications for the employer and possible organisational changes. 8

[23] It is difficult to form a preliminary view on the merits of the application given the paucity of information provided by Mr Kerin. While a party is not expected to particularise their case in detail as part of addressing the merits of the application under s.394(3)(e) of the Act, some further detail as to the applicant’s case would have been of assistance. On the information before the Commission it appears that there were operational reasons that necessitated a restructure of positions but I am unable to conclude that there is no reasonable prospect of success for the application.

[24] Taking into account all the considerations in s.394(3) of the Act, I am of the view that exceptional circumstances exist such that the extension of time should be granted.

[25]
I note that the respondent has foreshadowed a costs application against the applicant’s representative. This should provide an additional incentive for Mr Kerin to undertake a detailed assessment of the applicant’s case before proceeding further.

DEPUTY PRESIDENT

Written submissions:

Applicant’s Submissions, 19 September 2016

Submissions for the Respondent, 26 September 2016

Applicant’s Response, 7 October 2016

Affidavit of Anthony Kerin, 14 November 2016

Supplementary Submissions for the Respondent in Response to Affidavit of Anthony Kerin, 21 November 2016

 1   The Form F3 indicates that the employer employed 18 people at the date of the applicant’s dismissal.

 2 Under the National Employment Standards, the pay in lieu of notice requirement is limited to the hours that would have otherwise been worked – see s.117(2)(b) of the Fair Work Act 2009. There is no evidence that the applicant had a contractual or other entitlement to this benefit.

 3   [2013] FWC 5447 at [40].

 4   [2011] FWAFB 2728.

 5 (1997) 74 IR 413.

 6 (1998) 105 IR 1.

 7   See for example Burns v Aboriginal Legal Service of Western Australia (Inc) (unreported, AIRCFB, Williams SDP, Acton SDP, Gregory C, 21 November 2000) Print T3496.

 8   Form F3 and Submissions for the Respondent, 26 September 2016.

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