Mrs Esther Glanz v The Neighbourhood Early Learning Centre

[2010] FWA 4256

[2010] FWA 4256

FAIR WORK AUSTRALIA

DECISION

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

Mrs Esther Glanz
v
The Neighbourhood Early Learning Centre
(U2010/5569)

COMMISSIONER SPENCER BRISBANE, 12 OCTOBER 2010

Termination of Employment - extension of time.

Introduction

[1] The Applicant (Ms Glanz) made an application pursuant to s.394 of the Fair Work Act 2009 (Cth) (the Act), claiming she was unfairly dismissed from the Neighbourhood Early Learning Centre (the Respondent). Pursuant to s.394(2) of the Act , the application for relief must be made within 14 days after the dismissal took effect. The Applicant lodged her application out of time. This determination relates to the jurisdictional issue as to whether an extension of time should be granted by Fair Work Australia (FWA) to allow the application to proceed.

[2] The Applicant indicated in her application that the date she was notified of the dismissal, and the date it took effect, was 14 September 2009. This date is confirmed in the Employment Separation Certificate. The application was filed on 21 January 2010.

[3] The Respondent filed a jurisdictional objection as the application was lodged 115 days out of time.

[4] The Respondent’s representative, Mr Robert Winter of RJ Winter & Associates later sought that the Respondent’s name be changed from “Bright Horizons Australia Childcare Pty Ltd t/a Bright Horizons Childcare” to “The Neighbourhood Early Learning Centre” (the Respondent). The Applicant did not object to this, and the Respondents name was formally changed.

[5] The Separation Certificate (which details the Employer as the “Neighbourhood Early Learning Centre”) indicated that the Applicant’s position was made redundant. The Applicant’s submission contested the redundancy on the basis that other employees had been re-employed as Regional Managers. The Separation Certificate includes the details of the redundancy payment. Whilst the jurisdictional issue of the dismissal being a genuine redundancy was not pursued by the Respondent, the material submitted refers to the circumstances of the dismissal being a redundancy. Furthermore the redundancy was not questioned by the Applicant until the application was filed 115 days out of time and then the Respondent elected to object to the application being significantly out of time.

[6] Following a conference between the parties, Directions were issued for the filing of submissions on the jurisdictional matter. The Directions set out the issues to be considered in the submissions as per s.394(3) of the Act (set out below). The parties filed their material, with an extension provided. The material from the Respondent did not sufficiently respond to the reasons for the delay provided by the Applicant, accordingly further Directions were set for the Respondent to provide further materials. The Applicant was provided with further opportunities to respond and did provide a supplementary response. The parties agreed at the Directions hearing that the matter could be dealt with on the papers.

[7] Whilst this determination does not make reference to all of the materials filed in relation to this matter, all of such have been considered.

Legislation

[8] FWA is required to consider whether an application is made within time, as well as whether the Applicant was protected from unfair dismissal, prior to considering the merits of the application. Section 394(3) of the Act authorises FWA to extend the time for making the application if it is satisfied that there are exceptional circumstances, taking into account specific matters.

[9] The relevant sections of the Act are as follows:

394 Application for unfair dismissal remedy

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

…

(2) The application must be made:

(a) within 14 days after the dismissal took effect; or

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

(3) FWA may allow a further period for the application to be made by a person under subsection (1) if FWA 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.

396 Initial matters to be considered before merits

FWA must decide the following matters relating to an application for an order under Division 4 before considering the merits of the application:

(a) whether the application was made within the period required in subsection 394(2);

…

Submissions of Applicant

[10] The Applicant submitted that it was conveyed to her that her employment was made redundant on 14 September 2009 (effective that day), as a result of the ‘company not doing well financially’. She stated that she had been informed that other staff were also to be made redundant, but she had no confirmation that other redundancies had occurred. She further submitted that on 19 January 2010 (127 days later), she became aware that her position (Regional Manager) had been filled by an employee who had resigned several months prior. According to the Applicant, several directors of the Respondent (who were not named) confirmed to her that there was a new Regional Manager.

[11] The Applicant submitted that as soon as she discovered someone had been subsequently employed in her position, she took action by filing an unfair dismissal claim. She stated, in her witness statement:

“On the 14th September 2009, I was informed by management that my services were no longer required and the redundancy was effective immediately.

I was informed that other staff were to be made redundant as a means of reducing costs. (No other staff were laid off)

It was my belief that the company had financial problems. No application for unfair dismissal was made at this stage as there was no reason to think that they might be lying.

Consequently in the course of carrying out a new job I discovered that the position I had been made redundant from was being carried out by a previous staff member who had resigned several months prior. This occurred on 19th of January 2010.

I rang Mrs.Tamir Tukino, National Manager Bright Horizons/Neighbourhood and asked for an explanation as to why if there were any hours available, they weren’t offered to me. Mrs. Tukino could not provide one except to say that the company was going in a new direction, they were also looking at putting someone else on and that she did not have to speak to me and hung up.

I contacted other employees and they confirmed that [name withheld] was carrying out my former duties. My name was on the Bright Horizons website as the Queensland Regional Manager, it has been updated and my name has been replaced with the names of [name withheld] and [name withheld] as the two Regional Managers for Queensland.

As soon as I had discovered that my position had been taken over by another individual I contacted FWA to make application for unfair dismissal remedy immediately, even though the 14 day period had elapsed. Due to these exceptional circumstances an exemption would be appropriate.” 1

[12] The Applicant submitted that she had no reason to disbelieve what was told to her on 14 September 2009, and therefore, at that time, she had no cause to invoke s.394 of the Act and make an application for unfair dismissal. The application was filed 129 days after the dismissal when the Applicant stated she became aware of the further information as submitted.

Respondent’s submissions

[13] The Respondent’s submissions refuted the Applicant’s allegations that the redundancy was not genuine as follows:

“... there is no evidence of what it is alleged is being carried out by a “previous staff member”, when that person was employed and by whom. Its vagueness is such that its prejudicial value outweighs any probative value.

Further and alternatively to paragraph 1 of these submissions, Paragraph 6 of the “Witness Statement” should be excluded because:

(a) The “other employees” are not identified and the truth of what is said cannot be tested;

(b) It is too vague such that its prejudicial value outweighs any probative value.

(c) There is no evidence of what [name withheld] and [name withheld] do relative to the job description of the Applicant, and no inference as to that matter can be drawn from a job description because it is plain that they are employed by a company other than the Respondent.

There is no evidence that the Respondent has employed anyone to fill the position previously held by the Applicant.

There is no evidence that the Respondent was not then, and is not now, in financial difficulties.

Given the lack of evidence and in particular there being no evidence that the Respondent has employed anyone to fill the position previously held by the Applicant, the Application does not have sufficient prospects of success to warrant an extension of time”. 2

[14] The Respondent was requested in further Directions to provide further submissions and evidence specifically in response to the Applicant’s allegations:

“The [Applicant] was employed by Neighbourhood Early Learning Centres Pty Ltd

("NELC").

The Respondent was incorporated solely for the purpose of managing centres on behalf of A.B.C. Developmental Learning Centres Pty Ltd ("ABC") under a management agreement.

That management agreement has continued under the Receivers, and now Liquidators, of ABC and is terminable on 30 days notice.

Since about May 2009, the number of centres managed by NELC for ABC has decreased as the Receivers divested and closed centres. Hence the reduction in staff since that time and the redundancy of the position of the Applicant. Presently, there are only 11 centres under management by NELC and NELC understands that 3 of these are to be closed and the remainder diverted as soon as lease negotiations are finalised with the landlord. Once that occurs, NELC will have no further function and will be placed under external administration.

Bright Horizons Australia Childcare Pty Ltd ("BB") is, under the Corporations Act, a company related to NELC. Whilst it does manage some centres on behalf of 2 private operators, its primary function is to own centres.

The Applicant's submissions focus on staff appointments at BH, not NELC. No one has been appointed to NELC to replace the Applicant. Indeed, since about May 2009, there have been no staff appointments to NELC.” 3

[15] The Applicant was provided with an opportunity to respond, which she elected to do. An extract of the Applicant’s supplementary submission is as follows:

“Regardless of the technically correct name of the employing Company, I was dismissed from employment under the guise of redundancy and replaced by a fellow employee with lesser service - unbeknownst to me; ...

Bright Horizons and Neighbourhood Early Learning are closely related corporate entities with identical management structures. Neighbourhood was being transferred to a new name but the employer did not change, nor did the management structure, and it was not sold or transferred to a new owner.

The arrangement the employing Company had with ABC is immaterial as I was employed to conduct the management of services that Company was responsible for at the time.” 4

[16] The Respondent provided a statutory declaration from Tamir Lee Te Heu Heu Tukino, the National Operations Manager of the Respondent. This evidence regarding the company arrangements and importantly, that no other employment had occurred, stated as follows:

“NELC was incorporated solely for the purpose of managing centres on behalf of A.B.C. Developmental Learning Centres Pty Ltd (“ABC”) under a management agreement. That management agreement has continued under the Receivers, and now Liquidators, of ABC and is terminable on 30 days notice.

Since about May 2009, the number of centres managed by NELC for ABC has decreased as the Receivers divested and closed centres. Hence the reduction in staff since that time and the redundancy of the position of the Applicant. Presently, there are only 11 centres under management by NELC and NELC understands that 3 of these are to be closed and the remainder diverted as soon as lease negotiations are finalised with the landlord of those centres. Once that occurs, NELC will have no further function and will be placed under external administration.

Bright Horizons Australia Childcare Pty Ltd (“BH”) is, under the Corporations Act, a company related to NELC. Whilst it does manage some centres on behalf of 2 private operators, its primary function is to own centres.

No one has been appointed to NELC to replace the Applicant. Indeed, since about May 2009, there have been no staff appointments to NELC.

I understand that the Applicant has full time employment with another child care operator as a Centre Director.” 5

[17] The Applicant was given a further opportunity to respond to the National Operations Manager’s Statutory Declaration, and confirmed she relied on her earlier Statement.

Consideration

[18] The following provides an assessment of each of the provisions in s.394(3) of the Act to examine whether exceptional circumstances exist to allow for an extension of time.

s.394(3)(a) the reason for the delay

[19] The Applicant submitted that she was deceived as to the reason for her dismissal. She submitted that she was told her position was redundant, and upon learning that there was someone in her former position, some four months later, she filed an unfair dismissal claim.

[20] The Applicant stated that at the time she was made redundant she was a Regional Manager employed to oversee the management of the child care centres, and that the other two managers are still employed. The Applicant stated that on 19 January 2010 she learnt that another employee (name withheld), who had previously resigned had been re-employed in the position of “Regional Manager to child care centres on the coast.” In contrast Mr Winter (Solicitor for the Respondent) stated that no employees had been employed by the Respondent since May 2009 and that the number of centres the Respondent had managed had decreased, as the Receivers had divested and closed the ABC Centres. The evidence of the National Operations Manager also confirmed that there had been no further employment by the Respondent since May 2009 and further no other employee had been employed to replace the Applicant.

[21] The Applicant’s view was that until she learned of the re-employment of someone in her position, she had trusted that the Respondent had genuinely made her redundant; and had that been the case, she would not have pursued an unfair dismissal claim.

[22] The Respondent’s submissions and evidence denied the Applicant’s allegation that the redundancy was disingenuous, and stated that therefore, an extension of time could not be granted.

s.394(3)(b) whether the person first became aware of the dismissal after it had taken effect

[23] The Applicant was informed of the dismissal on the date of 14 September 2009, the date the dismissal also became effective, and was informed it was on the basis of redundancy. However, the Applicant did not form the view that she was unfairly dismissed until 19 January 2010, hence she explained this accounted for the delay in filing the application.

s.394(3)(c) any action taken by the person to dispute the dismissal

[24] The Applicant submitted that she believed that the Respondent was having financial difficulties and that this had been conveyed to her and therefore she did not take action against the Respondent at the time of the dismissal. The Applicant confirmed that at a later date on 19 January 2010 after discovering an employee was in her former position, she filed the unfair dismissal application two days after receiving this information.

[25] The Applicant stated that upon receiving information that made her question the dismissal, she expeditiously filed the application. However the application was filed more than 129 days after the dismissal took effect and 115 days after the 14 day time period permitted for filing the application.

s.394(3)(d) prejudice to the employer (including prejudice caused by the delay)

[26] The Respondent did not put forward specific submissions in relation to the prejudice that it would suffer if the extension of time application was granted. However the Respondent referred to the vagueness of the Applicant’s submissions and therefore the inability to test such and that the circumstances of the dismissal were genuine, and consistent with the scheme of closure of the child care centres under their management.

s.394(3)(e) the merits of the application

[27] The Respondent’s submission and evidence emphasised that the Respondent had been incorporated for managing centres on behalf of ABC Development Learning Centres Pty Ltd under a management agreement. This management agreement continued as the Receivers and Liquidators were appointed. The demise of ABC Childcare Centres is information that has been well-publicised in the public domain. The fact that Receivers and Liquidators have been appointed and the number of ABC Centres the Respondent were managing was reduced, as they were being divested, accords with the Respondent’s submission on the merits of the application and the circumstances of the Respondent. It is in opposition to the Applicant’s submission regarding further employment being undertaken.

s.394(3)(f) fairness as between the person and other persons in a similar position

[28] On the material presented, this consideration is not relevant to this matter.

Conclusion

[29] The Act requires FWA to be satisfied that there are exceptional circumstances in order to extend a period of time for a person to make an unfair dismissal application. In addressing the issue of ‘exceptional circumstances’, I adopt the approach taken by Whelan C in Parker v Department of Human Services 6 (as preferred by Lawler VP in Johnson v Joy Manufacturing Co Pty Ltd t/as Joy Mining Machinery7) as set out below:

“[30] Branson J, in a decision of the Full Court of the Federal Court (Hewlett Packard Australia Pty Ltd v GE Capital Finance Pty Ltd [2003] FCAFC 256) described exceptional circumstances as simply circumstances sufficient to render it just and equitable to grant relief.

[31] Dealing with the expression 'exceptional circumstances' as used in regulations dealing with the cancellation of visas, the Full Court of the Federal Court, in a recent decision, also noted that the expression had been considered by the courts on numerous occasions:

Although the expression “exceptional circumstances” is not defined in the Regulations, it has been the subject of consideration in numerous cases. Assistance in interpreting the expression can be found in comments of Lord Bingham of Cornwell CJ in R v Kelly (Edward) [2000] 1 QB 198 at 208 as follows:

We must construe “exceptional” as an ordinary, familiar English adjective, and not as a term of art. It describes a circumstance which is such as to form an exception, which is out of the ordinary course, or unusual, or special, or uncommon. To be exceptional a circumstance need not be unique, or unprecedented, or very rare; but it cannot be one that is regularly, or routinely, or normally encountered.”

[Mann v Minister for Immigration and Citizenship [2009] FCAFC 150]”

[30] A consideration of the material presented doesn’t provide a basis for a conclusion that exceptional circumstances existed to grant the extension of time. The submission by the Applicant of a further employee being employed initiated the Applicant’s application; although she was frustrated with the redundancy. The Respondent had at all times provided that the circumstances of the Applicant’s termination related to the reduction of the Respondent’s management obligations commensurate with the continued sale or closure of the ABC Centres. This is also consistent with the reduced management obligations of the Respondent of the ABC Centres in accordance with the directions by the Receivers and then Liquidators. In line with this the Respondent’s evidence was that no further employees had been employed in contrast to the Applicant’s allegations.

[31] Accordingly the application for an extension of time pursuant to s.394(3) of the Act is refused and the application made pursuant to s.394 of the Act is dismissed. I Order accordingly.

COMMISSIONER

 1   Statement of Ms Esther Glanz.

 2   Submissions of the Respondent.

 3   Supplementary Submissions of the Respondent.

 4   Supplementary Submissions of the Applicant.

 5   Statutory Declaration of Tamir Lee Te Heu Heu Tukino.

 6 [2009] FWA 1638.

 7   [2010] FWA 1394.

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