Mr Abraham Banda v Plantman Equipment

[2015] FWC 8428

[2015] FWC 8428

FAIR WORK COMMISSION

DECISION

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

Mr Abraham Banda
v
Plantman Equipment
(U2015/12219)

COMMISSIONER ROE MELBOURNE, 4 DECEMBER 2015

Application for relief from unfair dismissal - high income threshold.

[1] Mr Banda has made an unfair dismissal application and Plantman argues that there is no jurisdiction to hear the application because Mr Banda earned more than the high income threshold of $136,700 and is not covered by an Award or Agreement. There are two issues in dispute in this case.

● What were Mr Banda’s annual earnings?
● Was Mr Banda’s employment covered by an Award?

[2] The Fair Work Act 2009 defines earnings as follows.

“332 Earnings

(1) An employee’s earnings include:

(a) the employee’s wages; and
(b) amounts applied or dealt with in any way on the employee’s behalf or as the employee directs; and
(c) the agreed money value of non-monetary benefits; and
(d) amounts or benefits prescribed by the regulations.

(2) However, an employee’s earnings do not include the following:

(a) payments the amount of which cannot be determined in advance;
(b) reimbursements;
(c) contributions to a superannuation fund to the extent that they are contributions to which subsection (4) applies;
(d) amounts prescribed by the regulations.

Note: Some examples of payments covered by paragraph (a) are commissions, incentive-based payments and bonuses, and overtime (unless the overtime is guaranteed).
(3) Non-monetary benefits are benefits other than an entitlement to a payment of money:

(a) to which the employee is entitled in return for the performance of work; and
(b) for which a reasonable money value has been agreed by the employee and the employer;

but does not include a benefit prescribed by the regulations.

(4) This subsection applies to contributions that the employer makes to a superannuation fund to the extent that one or more of the following applies:

(a) the employer would have been liable to pay superannuation guarantee charge under the Superannuation Guarantee Charge Act 1992 in relation to the person if the amounts had not been so contributed;
(b) the employer is required to contribute to the fund for the employee’s benefit in relation to a defined benefit interest (within the meaning of section 291-175 of the Income Tax Assessment Act 1997) of the employee;
(c) the employer is required to contribute to the fund for the employee’s benefit under a law of the Commonwealth, a State or a Territory.”

[3] The regulations prescribe the following in respect to non-monetary benefits.

“3.05 Benefits other than payment of money

(5) If:

(a) the person is entitled to receive, or has received, a benefit in accordance with an agreement between the person and the person’s employer; and
(b) the benefit is not an entitlement to a payment of money and is not a non-monetary benefit within the meaning of subsection 332(3) of the Act; and
(c) the FWC is satisfied, having regard to the circumstances, that:
(i) it should consider the benefit for the purpose of assessing whether the high income threshold applies to a person at the time of the dismissal; and
(ii) a reasonable money value of the benefit has not been agreed by the person and the employer; and
(iii) the FWC can estimate a real or notional money value of the benefit;

the real or notional money value of the benefit estimated by the FWC is an amount for subparagraph 382(b)(iii) of the Act.”

[4] Mr Banda’s earnings are disputed. Mr Banda says that his guaranteed earnings are $125,217.40 whilst Plantman estimate annual earnings to be $171,708.83. Plantman base this on the actual gross payments made to Mr Banda for the period of his employment from 3 February 2015 until 18 September 2015. This amount has then been factored up to produce annual earnings.

[5] Mr Banda says that he is required in his contract of employment to work a two week on one week off roster for 12 hours per day which includes a 30 minute unpaid break. The contract is therefore for 11.5 paid hours per day for a flat hourly rate of $45 per hour. The contract of employment originally showed $50 per hour but this rate was reduced in July 2015 to $45 per hour. The reduction to $45 per hour is not time limited.

[6] I do not accept Mr Banda’s submission that the rate of $45 per hour should be used for the annual earnings. Rather the rate of $50 should be used for the first four months and $45 should be used for the balance in estimating annual earnings. This would increase the guaranteed earnings on an annualised basis to about $129,380.

[7] Mr Banda says that he did work a substantial amount of overtime and travel time. The amount of travel time and overtime is not guaranteed or able to be determined in advance. Mr Banda says that Plantman’s estimates include these amounts and also the pay out on termination of his accumulated annual leave. I accept that payment of accumulated leave on termination does not form part of his annual rate of earnings. I also accept that the amounts earned in respect to overtime hours and travel time are not earnings which should be included for the purpose of calculating the annual rate of earnings. Mr Masters for Plantman conceded that there were periods of time when Mr Banda worked in the workshop and during those periods he did not receive any travel payments and he was not guaranteed any overtime. The payment of overtime hours and travel time hours is therefore dependent upon business needs and is not guaranteed. The guaranteed pay in the contract is therefore 11.5 hours per day on a two week on one week off basis. The guaranteed earnings annually is therefore $129,380.

[8] The parties agreed that the only non-monetary benefits which might be considered in this case are the personal use of the work mobile phone. I am satisfied that the reasonable value of the personal use of these items should be considered for the purposes of the threshold. The parties agreed that personal use was about 20% and the value of the personal use is approximately $1000. Therefore the annual earnings is approximately $130,380 which does not exceed the high income threshold.

[9] The parties agreed that the position description provided by Mr Masters was an accurate reflection of Mr Bandas’ work. According to the position description, Mr Banda was responsible for the maintenance and repair of heavy vehicles, namely earthmoving, construction and mining equipment and machinery on site. He was described as a field service technician. He was “responsible for ensuring all Plantman equipment is physically serviced and maintained to OEM and site specific specifications as minimum standard”. This was estimated to take 60% of his time. The balance was to assist the plant superintendent with planning and scheduling of repairs and complete necessary paperwork and order necessary parts and communicate with clients as part of the process. He reported to the plant superintendent. I am satisfied that the substantial character of the job is a hands on maintenance tradesperson. Mr Banda is a qualified diesel fitter employed primarily for this type of work.

[10] Heavy vehicle maintenance of this sort is in some situations covered by the Mining Industry Award where the “employee is principally employed to perform work on an ongoing basis at a mine site.” This is not the case with Mr Banda as his work location depended upon Plantman’s requirements and Plantman is not a mining company.

[11] I am satisfied that the work is covered by the Manufacturing and Associated Industries and Occupations Award 2010 (the Award). The work of Mr Banda and Plantman falls within the definition in the coverage clause of the Award for “manufacturing and associated industries and occupations” and the following in particular (Clause 4.9(a)(iii)) and (iv)):

“(iii) the repair, refurbishment, reconditioning, maintenance, installation, testing and fault finding of:

• any of the items referred to in clause 4.9(a)(i); or



• floor covering; or



• plant, equipment and buildings (including power supply) in the industries and parts of industries referred to in clauses 4.9(a)(i) and (ii); or



• plant, equipment and buildings (including power supply) in any other industry

(iv) mechanical and electrical engineering.”

[12] The items referred to in 4.9(a)(i) as further defined in 4.10 includes any motor driven vehicles and industrial machinery.

[13] The work then falls comfortably within the engineering/manufacturing tradesperson classifications of the Award at somewhere between C10 and C6 level (Schedule B of the Award).

[14] The work falls within the trade field and the mechanical stream as defined in clause 3 of the Award:

“trade field which includes employees who possess as a minimum qualification a trade certificate in any of the engineering streams or a Certificate IV in Engineering including Higher Engineering Trades or Special Class Trades.”

“mechanical stream which includes the design, assembly, manufacture, installation, modification, testing, fault finding, commissioning, maintenance and service of all mechanical equipment, machinery, fluid power systems, automotive mechanics, instruments and refrigeration, and the use of related computer controlled equipment, such as Computer Numeric Controlled machine tools.”

[15] I am satisfied that Mr Banda’s work for Plantman is covered by the Award.

[16] Mr Banda is therefore protected from unfair dismissal.

[17] The matter will now be listed for hearing.

COMMISSIONER

Appearances:

Mr A Banda represented himself.

Mr T Masters appeared for the Respondent.

Hearing details:

2015

Perth

November 2015

Printed by authority of the Commonwealth Government Printer

<Price code C, PR574752>