Mr Qaisir Khan v Risk Protection Group

[2017] FWC 740

[2017] FWC 740

FAIR WORK COMMISSION

DECISION

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

Mr Qaisir Khan
v
Risk Protection Group
(U2016/11876)

COMMISSIONER ROE MELBOURNE, 13 FEBRUARY 2017

Application for relief from unfair dismissal.

[1] Risk Protection Group (RPG) provides security services to Metro trains in Melbourne. Risk Protection Group provides other security services but the Metro contract is a large one and they are the sole provider of these services. Many of the security services required for Metro trains are regular and ongoing – that is, they are required at particular stations at particular times every day or week. However, some services are required in response to particular demands, for example construction work, and Metro from time to time varies their service requirements. Risk Protection Group utilise the services of some other labour hire contractors to provide some of the security service labour they need.

[2] Mr Khan says that he has been employed as a security guard for the Metro trains contract since 2010. Initially he was employed by a labour hire contractor AIG and supplied services to Risk Protection Group. Mr Khan says that he has been employed directly by Risk Protection Group since June 2010. Mr Khan says that throughout this period he has worked regular hours and he provided some evidence of 2016 rosters to demonstrate this. 1

[3] Mr Khan gave evidence which I accept that he has never received pay slips throughout the period of his employment. He says that during the period 2010 to 2011 he was asked to provide invoices for his work. In 2011 he says that Mr I Singh told him and others that they no longer had to put in invoices. Mr Khan provided a copy of an invoice dated 20 July 2010. The invoice is directed to the Risk Protection Group and is for four shifts of work at a rate of $18 per hour.

[4] Mr Khan made a complaint concerning underpayment with the Fair Work Ombudsman (FWO) in 2016. Mediation organised by the FWO to resolve the dispute was scheduled for 24 May 2016 but was unable to take place because RPG refused to participate and advised that RPG was not Mr Khan’s employer and that AIG was the employer. Mr Khan says that on that day at 1pm he rang Sean from AIG and asked him if he was working for AIG. He says that Sean said “no. you are not working for us since 2009”. RPG were aware that Mr Khan claimed that RPG was his employer as a result of the Fair Work Ombudsman complaint.

[5] Mr Khan says that on 7 September 2016 his usual shifts were cut for that week and for the following week. He was then offered shifts again but the number of hours of work per week was considerably less than previously and some of the work was at Frankston rather than Dandenong where the previous work had been based. Mr Khan says that despite repeated attempts to contact his RPG manager he could not get any response. Mr Khan says that he also sent an email. Mr Khan says that other workers were asked by Mr I Singh to sign tax forms on 7 September but he was never asked. The actions during this period led Mr Khan to make his unfair dismissal application on 27 September 2016.

[6] Mr Khan says that he received an email dated 13 December 2016 stating that he was being moved to a new business called ISF. He has been offered work and has accepted work from ISF to provide security services for RPG at Metro since that time.

[7] It is not contested and I am satisfied that Mr Khan has worked on a regular and systematic basis with a reasonable expectation of continuing employment since 2010. It is not contested and I am satisfied that Mr Khan is protected from unfair dismissal and any termination of his employment was not a genuine redundancy. The issues in contention in this case are:

● Was RPG Mr Khan’s employer?
● Was Mr Khan dismissed?
● If Mr Khan was dismissed was the dismissal unfair?
● If Mr Khan was unfairly dismissed what should be the remedy?

Was RPG Mr Khan’s employer?

[8] Risk Protection Group say that Mr Khan has never been employed by them but that he has been employed by AIG Security Services (AIG) to conduct services for the Risk Protection Group under its Metro Trains contract up until 11 December 2016. Since late December 2016 they say Mr Khan has been employed by another contract company, International Security Force (ISF). Risk Protection Group has ended its contract with AIG Security Services in response to concerns raised by Metro about the company.

[9] Evidence concerning the relationship between Mr Khan and Risk Protection Group was given by Mr Khan; Mr Boyd Hooper, Managing Director of RPG; Mr Scott Taylor, Chief Operating Officer of RPG; and Mr Jeff O’Neill, Operations Manager of RPG. Mr Khan gave evidence that he understood Mr Jeff O’Neill was also responsible for payroll. Mr O’Neill is also described in some documents as the Contract Manager. Mr O’Neill reports directly to Mr Hooper.

[10] Mr Khan gave evidence that in June 2010 Wayne O’Neill from RPG came to the rail yard where he was working and spoke to him and the other guards employed there. He introduced himself as a manager of RPG and “offered for the guards to change to work directly for RPG”. Mr Khan says that he and his colleagues agreed and he then went to the Boronia office of RPG and signed paperwork. He says that Jeff O’Neill was present at the time the paperwork was signed. Mr Jeff O’Neill gave evidence that he does not recall Mr Khan being made an employee of RPG.
[11] Mr Khan provided a copy of his personal bank account statement from 2011 2 which shows a series of regular payments into his account from “INTEGRATED ADMIN RPG Services”. RPG submitted that the fact that “Services” is in lower case signifies that the payment is from Integrated Admin for work at RPG services rather than signifying that the payment is from RPG Services. I can see no basis for this submission.

[12] Mr Jeff O’Neill gave evidence that although Mr Wayne O’Neill describes himself in correspondence as an Operations Manager in 2010 he was in fact an RPG supervisor. Mr O’Neill also gave evidence that RPG did not employ anyone directly as part of the Metro contract until late 2015. 3 At this time some employees of the contractors were asked if they wished to become direct RPG employees. Mr O’Neill could not give any details of who was offered jobs and who was not. Mr O’Neill suggested that the move to employ some people directly was to ensure consistency with the Metro contract. On balance I do not accept the evidence of Mr O’Neill that Mr Wayne O’Neill fraudulently adopted the title Operations Manager. Mr Wayne O’Neill used the title in his correspondence to a number of employees including Mr Khan advising them of the requirement to attend PPE training.

[13] Mr I Singh was one of the day to day supervisors of Mr Khan’s work throughout his employment. Mr Singh has and uses an RPG email and he has the title of Roster Manager RPG. He issues the rosters for all the employees including those who are accepted to be RPG direct employees. He issues notices concerning work instructions such as relating to collecting rubbish to a wide group of employees including those who are accepted by RPG as direct employees. Mr Singh is responsible for day to day supervision and discipline. Mr Taylor gave evidence that if it was a more serious matter then the RPG Contract Manager, Mr O’Neill would get involved. The written advice to Mr Khan about his rosters comes from Mr Singh using an RPG job title and an RPG email address.

[14] RPG produced a document entitled “Risk Protection Group –MTM Staff Listing – 2^nd December 2016”. 4 The document is from many months after the alleged dismissal of Mr Khan. I am not satisfied that the document provides any probative evidence of who was Mr Khan’s employer prior to September 2016. There are approximately 196 names on this list which is also described as “RPG Guard Engagement Listing”. 62 of the names on the list, including Mr Khan, are said to be “AIG” and the rest are said to be “RPG”. RPG witnesses accepted that Mr Singh drew up the rosters in cooperation with other RPG employees. RPG witnesses accepted that there was a single roster and there was no identification of AIG employees in the roster. I accept the evidence of Mr Khan that as far as employees were concerned Mr Singh held himself out to be the roster manager for RPG. I am satisfied that Mr Singh’s communications and instructions as a manager applied equally to employees including those RPG accepts were its direct employees. RPG witnesses said that Mr Singh was an employee of AIG and was engaged as the contact person between RPG and AIG on site. RPG witnesses say that when Metro told RPG that it could not use AIG any more in late 2016 Mr Singh was then engaged by the new contractor ISF and remains in the same role as he had before at RPG. I find this evidence unconvincing. I am satisfied that Mr Singh held himself out to be and acted as a manager for RPG in respect of all security guards working for RPG on the Metro contract including Mr Khan. Mr Singh provided direct instructions concerning rubbish to a list of 95 employees including acknowledged direct employees of RPG as shown on the 2 December 2016 list.5

[15] The evidence also establishes that there was a common uniform, a common sign in register and a common equipment register for all security guards working for RPG on the Metro contract including Mr Khan.

[16] Mr Taylor gave evidence that the contract with Metro requires a proportion of direct employees. Mr Hooper gave evidence that the agreement between RPG and Metro requires them to have at least 40% direct employees. This contrasts with the evidence of Mr O’Neill that prior to late 2015 Metro did not employ anyone directly as part of the Metro contract.

[17] Mr Hooper provided generalised opinions about the security industry generally and evidence about what TPG did for clients such as major sporting and entertainment venues and events. I am satisfied that he avoided focusing on the Metro contract because Metro’s staffing requirements are much more stable. I accept that from time to time Metro changes its security staffing requirements and also that from time to time there are special events or needs. In October 2016 Metro advised RPG that patrols would no longer be required for a number of sidings. 6 However, much of the security staffing requirements are stable, that is, required on a regular pattern and at regular locations. This is reflected in the regularity of the shifts worked by rostered security guards including Mr Khan.

[18] Mr Hooper gave evidence that the contract between AIG and RPG for AIG to provide labour to RPG and for that labour to work under RPG direction was entered into on 10 July 2012 for a period of 2 years. 7 The contract provided that up to two extensions of two years could be entered in to. An audit by Metro in 2016 revealed that there was no documentary record of any extension. Mr Hooper says that in response there was an email exchange dated 17 March 2016 to confirm an extension of the contract.8

[19] Mr Hooper produced an invoice by AIG to RPG for $34,765.04 for “security and events staff” dated 11 December 2016. The invoice identified that there was no “supply of security guards”. There was a similar invoice for November 2016. Evidence of payment was also supplied. 9 Mr Hooper gave evidence that AIG provided labour for RPG for contracts other than the metro contract including for events security clients. I am not satisfied that the invoices relate to services provided by AIG to RPG for the Metro contract.

[20] Mr Hooper suggested that labour hire contractors were necessary and were used to deal with the client’s fluctuations in labour demand. I accept that evidence. I also accept that there are very significant fluctuations in labour demands for entertainment and event venue clients. I accept that there are some variations and fluctuations in respect to the Metro contract and that labour hire contractors including AIG may have been used to meet these irregular demands for labour. However, I am satisfied that Mr Khan’s shifts were regular and consistent and I am not satisfied that he was part of the supplementary labour force.

[21] Mr Khan provided a copy of a notice which he says that he and a number of other staff received dated 13 December 2016. The email notice is from “AIG Payroll” to 26 people advising them that “due to some operational and reporting changes with one of our clients, Risk Protection Group, a decision has been made to change providers”. It goes on to say that “the transition discussions and negotiations have been very positive and successful and as such, I would like to formally announce International Security Force (ISF) have taken over the above mentioned work.” “Due to this change, we are undergoing a restructure of our operations and as such, some of our rostering and compliance team will also be transferred across to the new provider to help ensure continuity of service to the clients and a smooth transition to the workforce.” This notice was sent many months after Mr Khan made his unfair dismissal application in September 2016. I am satisfied that this notice is most confused about who is making decisions – it appears that AIG is making decisions about who will provide labour for the Metro contract.

[22] RPG produced an unsigned and unaddressed document dated 2 January 2017 which is on AIG letterhead which states as follows: “To whom it may concern. This letter is to confirm that Mr Qaisir Khan was engaged by AIG Security Services to conduct Services for Risk Protection Group Pty Ltd at various sites up until 11^th December 2016. Regards AIG Management”. 10 This correspondence was never provided to Mr Khan prior to the hearing of this matter. Mr Taylor gave evidence that he asked AIG for the correspondence for compliance purposes. Mr Taylor says that he asked for similar letters in respect to other employees. RPG produced in proceedings a wide range of documents concerning AIG including AIG’s security licence. I am satisfied that if documents existed, such as payroll information, RPG was in a good position to obtain those documents from AIG. I am satisfied that it is significant that this unsigned document dated after the time period it is claimed Mr Khan was an employee of AIG is the best evidence AIG can produce of an employment relationship between AIG and Mr Khan. If as claimed by Mr Taylor the letter was required for compliance purposes then I am satisfied that the letter would have been addressed to Mr Taylor and would have been signed by a responsible person on behalf of AIG. If the letter was required for compliance purposes then the period of Mr Khan’s employment would have been included. I am not satisfied that the document assists RPG’s case that it was not Mr Khan’s employer.

[23] RPG were on notice that Mr Khan relied upon a number of documents that suggested that Mr I Singh was acting as a manager on behalf of RPG. I am satisfied that RPG control the work of Mr Singh and that they could have required him to provide evidence if it would have assisted their case.

[24] RPG were also on notice that Mr Khan would give evidence that Mr Wayne O’Neill entered into an employment contract with him on behalf of RPG. It was open to RPG to bring evidence to challenge this. The only challenge offered was the claim that Mr Wayne O’Neill was not in fact an operations manager and therefore he did not have the authority to engage Mr Khan. I prefer the evidence of Mr Khan and the documentary evidence which shows that Mr Wayne O’Neill presented himself as RPG Operations Manager. RPG accepted that the other Operations Manager had the authority to engage employees.

[25] I have made the following findings:

● I have accepted the evidence of Mr Khan concerning his engagement by RPG in June 2010. This establishes the essential elements of the employment contract – offer, acceptance and consideration.
● I have accepted that Mr I Singh acted as a manager for RPG and his actions in directing and allocating the work of Mr Khan support a finding that Mr Khan was an employee of RPG.
● I have accepted the evidence that Mr Wayne O’Neill was in fact an Operations Manager of RPG and therefore had the authority to hire Mr Khan and did in fact hire Mr Khan as an employee of RPG.
● The bank statements showing deposits from “INTEGRATED ADMIN RPG Services” supports a finding that Mr Khan was an employee of RPG.
● The evidence that Mr I Singh requested that Mr Khan provide invoices and then told Mr Khan that they were no longer required supports a finding that Mr Khan was an employee of RPG.
● I do not accept the staff list of 2 December 2016 accurately describes Mr Khan’s employer. Mr Taylor gave evidence that the roster system was the source of the data. However, there is earlier evidence that there was no separate identification of AIG employees on the common roster and Mr Singh was involved in development of the common roster and issued instructions to employees on the common roster.
● Although it is not determinative in isolation the fact that Mr Khan used a common RPG uniform, sign in register and equipment register supports a finding that Mr Khan was an employee of RPG.
● RPG was in a position to bring definitive evidence that Mr Khan was an employee of AIG but failed to do so. The evidence RPG produced concerning its relationship with AIG for the purposes of supplying labour for the Metro contract was thin.
● I have accepted the evidence of Mr Khan that when the FWO advised him that RPG denied they were his employer he contacted Sean from AIG and AIG denied that he had been an employee of AIG since June 2010.
● I have accepted the evidence of Mr Khan that he never received any correspondence from AIG during the period from June 2010 until 13 December 2016.

[26] I am satisfied that Mr Khan was employed by RPG throughout the period from June 2010. It remains to be determined if Mr Khan was dismissed from his employment on either 14 September 2016, allegedly due to demotion by removal or reduction of work, and/or, on 13 December 2016 when he was transferred, allegedly without his consent, to work for ISF.

Was Mr Khan dismissed?

[27] The Fair Work Act 2009 (the Act) defines dismissal as follows:

“386 Meaning of dismissed

(1) A person has been dismissed if:

(a) the person’s employment with his or her employer has been terminated on the employer’s initiative; or

(b)  the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.

(2) However, a person has not been dismissed if:

(a) the person was employed under a contract of employment for a specified period of time, for a specified task, or for the duration of a specified season, and the employment has terminated at the end of the period, on completion of the task, or at the end of the season; or

(b)  the person was an employee:

(i)  to whom a training arrangement applied; and
(ii)  whose employment was for a specified period of time or was, for any reason, limited to the duration of the training arrangement;

and the employment has terminated at the end of the training arrangement; or

(c)  the person was demoted in employment but:

(i)  the demotion does not involve a significant reduction in his or her remuneration or duties; and
(ii)  he or she remains employed with the employer that effected the demotion.

(3)  Subsection (2) does not apply to a person employed under a contract of a kind referred to in paragraph (2)(a) if a substantial purpose of the employment of the person under a contract of that kind is, or was at the time of the person’s employment, to avoid the employer’s obligations under this Part.”

[28] Mr Khan remained employed by RPG after 14 September 2016. I am satisfied that there was a significant reduction in his remuneration after 14 September 2016. There was a two week period of no remuneration and then a period when the number of weekly hours was decreased from 19 to 15. For a low income worker this is a significant reduction.

[29] Mr Dirks for Mr Khan submitted that:

“The applicant has been there for a long time.  He's not paid as a full-time, he's not being paid holiday pay or any entitlements by the way of leave, no superannuation; we don't know if there's any WorkCover.  He is certainly not a casual.  There's no element of a casual loading in there to compensate for those things, and the rates are just so low compared to the award that it's not funny.  So I don't think you can accept oh that the applicant is a casual employee, therefore had no entitlement to any permanency in the shifts.  The long-held industrial purpose for the casual loading of a percentage on top of the minimum that would otherwise apply was all in part to compensate for some leave entitlements.  It was also largely to compensate for the lack of job security.  There is no casual loading in this case; therefore, there can't be any claim that the lack of job security has been in some way catered for.  This is more of the sort of case that has become a bit too notorious, where people are simply not being paid the minimum entitlements, and it tends to be focused on particularly disadvantaged parts of the labour market and this is a case in point here.

Certainly in relation to whether the applicant had a reasonable expectation that things would continue, the document which was at attachment QK17, which was given a separate exhibit number, K3, shows the absolute perfect predictability of the work up until the point where the work was withdrawn.  If it was to be regarded that the applicant was a casual employee then there is enough case law around that.  It says that a casual employee who is dropped off the roster where they could reasonably expect work to be offered, you can take that as a termination of employment.  One such decision was that of Commissioner Smith, as he was then, in Diana Sherwin v Adesse Pty Ltd[2008] AIRC 900.  It's a matter that I was involved in.” 11

[30] Mr Khan gave the following evidence concerning his shifts:

“He is your day-to-day manager, so he tells you what days you might be able to work and he also tells you what you need to do on a given day at work?---Most of the time he give us, like, permanent roster.

You say most of the time?---Most of the - - -

You are offered those shifts, aren't you?---No.  When I, like - when I was working - when I was living in Frankston, he gave me the work in Frankston, but when I was living in Dandenong, he started giving me shifts in Dandenong.

Yes, that's right, but he would offer you shifts?---Yes.

You didn't have to take them, did you?---He will offer - he offer me shifts.

He would offer them?---Yes.

But you weren't required to - - -?---Yes.  I'm required to do it, yes.

You say you were required to do it - - -?---Yes.” 12

[31] I conclude from this evidence that Mr Khan:

● Was engaged on a regular and systematic basis with an expectation of ongoing employment.
● Generally worked regular rostered shifts during the period but there were occasions when this was not the case.
● During the period 4 April 2016 to 1 September 2016 Mr Khan worked 19 hours over two shifts each week except for the weeks of 1 May and 15 May.
● In previous years Mr Khan worked different shifts at different locations.
● Expected shifts to be offered to him which implies that they might change from time to time.

[32] I do not accept that underpayment of wages is a reason to conclude that the essential nature of the employment relationship is not as a casual employee. All the indicators must be taken into consideration to make an overall judgement as to the character of the employment relationship. On balance I conclude that Mr Khan was a casual employee.

[33] I accept the evidence of RPG that on at least two occasions in 2016 Metro made some changes to its security requirements which involved reducing the number of locations where security was required with a consequential reduction in the number of shifts required to be filled. In these circumstances there was a legitimate business reason to reduce the number of hours allocated to casual employees. I accept that there is no evidence of any change in respect to available shifts at Dandenong where Mr Khan mostly worked. However, if shifts were cut elsewhere it was open to RPG to reallocate shifts more generally. I am not satisfied that Mr Khan was engaged for a fixed number of weekly shifts. I am not satisfied that what happened on 14 September 2016 and in the immediately following period can be described as a dismissal. Of course the total removal of working hours for a regular and systematic casual is a dismissal. However, in this case shifts were restored after two weeks. There will also be some circumstances where a significant reduction in the regular hours of a regular and systematic casual will be a dismissal. However, given the legitimate business reasons for the reduction in shifts, I am not satisfied that the reduction in the circumstances of this case is a dismissal.

[34] The application in this case makes it clear that the alleged dismissal and demotion took place in September 2016. Mr Dirks for Mr Khan made it clear that he was not relying on the 13 December 2016 letter to establish that Mr Khan had been dismissed by RPG. 13 I am satisfied that the decision purporting to change Mr Khan’s employer by letter of 13 December 2016 was without his consent. Employees cannot be shifted from one employer to another like material assets. The fact that Mr Khan has continued to work does not alter the fact that the change in employer was without consent. RPG had been on notice that Mr Khan regarded RPG as his employer and he was actively pursuing alleged underpayment of entitlements. RPG made the decision on the instructions of Metro to end AIG’s involvement with the Metro contract and RPG made the decision to utilise ISF. The letter of 13 December 2016 says that “a decision has been made to change providers”. This decision has been made by RPG. The letter “announces” that ISF have taken over the work. The letter says that there will be no change to shifts or hours and that “in effect it will be business as usual.” It is not necessary to determine whether or not Mr Khan was dismissed in December 2016.

[35] As I have found that there has been no dismissal the application must be dismissed and an Order to that effect is published separately.

COMMISSIONER

Appearances:

Mr G Dircks appeared for the Applicant.

Mr A Pollock appeared for the Respondent.

Hearing details:

2017

Melbourne

January 20

 1   Exhibit K3.

 2   Exhibit K1, Attachment QK4.

 3   PN843 to PN844.

 4   Exhibit R8

 5   Exhibit K1, Attachment QK1.

 6   Exhibit R5.

 7   Exhibit R2.

 8   Exhibit R3.

 9   Exhibit R4.

 10   Exhibit R7.

 11   PN937 to PN938.

 12   PN277 to PN284.

 13   PN937.

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