Ms Alicia Trevelyan v Soulfresh Pty Limited T/A Soulfresh
[2012] FWA 8354
•5 OCTOBER 2012
[2012] FWA 8354 |
|
DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Ms Alicia Trevelyan
v
Soulfresh Pty Limited T/A Soulfresh
(U2012/1299)
COMMISSIONER CARGILL | SYDNEY, 5 OCTOBER 2012 |
Termination of employment - Jurisdiction.
[1] This decision relates to an application by Ms A Trevelyan (the applicant) pursuant to section 394 of the Fair Work Act 2009 (the Act) for a remedy in respect of her dismissal by her former employer whom she identifies as Soulfresh Pty Limited (Soulfresh). The application was lodged on 3 June 2012.
[2] Soulfresh opposes the application on the basis that it was not the applicant’s employer. It says that the applicant was employed by Karma Goods Pty Ltd (Karma Goods). Soulfresh has lodged an objection to the claim and seeks its dismissal.
[3] The matter was heard as part of the jurisdictional roster on 14 September 2012. The applicant represented herself and Soulfresh was represented by Mr Ganly, the company accountant.
[4] The applicant gave evidence in the form of a comprehensive witness statement, Exhibit Applicant 4 as well as orally, PN 264-353 of Transcript. Evidence was also given in the applicant’s case by Ms Calvert, the applicant’s prior employer. Ms Calvert’s witness statement was marked as Exhibit Applicant 3 and her oral evidence is at PN 241-259 of Transcript.
[5] Evidence was given for Soulfresh by Mr Dubb, director of Karma Goods. His witness statement was marked Exhibit Respondent 1 and his oral evidence is at PN 40-226 of Transcript.
FACTS AND EVIDENCE
[6] Soulfresh is a wholesale food and beverage distributor based in Melbourne. There are related companies which operate in Queensland, Tasmania and Western Australia. As a result of various commercial restrictions Soulfresh is unable to distribute in other states. Mr Dubb’s evidence is that he is neither a director nor a shareholder of Soulfresh Pty Ltd. This is confirmed in an ASIC company report for Soulfresh Pty Ltd at Annexure GDD-1 to Exhibit Respondent 1. That report shows the directors and shareholders of the company to be D. Lo and H. Lo.
[7] There is also a management company, Soulfresh Management Pty Ltd, which is presently under external administration. In addition, there is a company called Soulfresh Australia Pty Ltd (Soulfresh Australia) which was registered on 23 September 2011, after the applicant commenced employment. Mr Dubb is a director of Soulfresh Australia.
[8] Mr Dubb is the sole director and shareholder of Karma Goods. This is confirmed in the ASIC documentation at Annexure GDD-1 to Exhibit Respondent 1. Karma Goods is also a food and beverage wholesaler.
[9] It is Mr Dubb’s evidence that, on 1 June 2011, Karma Goods entered into a management arrangement with Soulfresh with a view to merging the two businesses at some unspecified future point. His evidence is that, as part of this arrangement, Soulfresh agreed to provide Karma Goods with copies of procedural and policy documents and access to its computer based management system. In addition, Soulfresh agreed, for a fee, to take over the administration of Karma Goods’ business including the accounting and payroll functions. Karma Goods agreed to stock particular products and implement Soulfresh policies and procedures. Mr Dubb testified that he was unsure whether the management agreement was in writing.
[10] Mr Dubb’s evidence is that, while this agreement brought the businesses closer in terms of their operations, they remain separate entities.
[11] On 27 July 2011 the applicant attended a job interview with Mr Dubb. The position had been advertised in the name of Karma Goods. The applicant agreed that she was aware that Karma Goods and Soulfresh were separate entities. It is the applicant’s evidence that, during the interview, Mr Dubb informed her that Karma Goods and Soulfresh were in the process of merging and that she was to be interviewed by the CEO of Soulfresh, Mr D. Lo. That interview took place on 4 August. The applicant’s evidence is that she understood from the interview process that Soulfresh had “a fair amount of involvement” in the enterprise. Mr Dubb denied that Mr Lo was actively involved in the decision to recruit the applicant or the drafting of her employment contract.
[12] There then followed a number of telephone discussions and email exchanges between the applicant and Mr Dubb about the terms of the applicant’s employment. These included Mr Dubb providing the applicant with a copy of the Soulfresh commission structure and noting that he would ask Mr Lo about certain issues such as the applicant’s job title.
[13] On 13 August 2011 the applicant received a draft employment agreement. The agreement was expressed as being between the applicant and Soulfresh Pty Ltd. The applicant requested that her job description be included in the agreement. Mr Dubb referred to Mr Lo about this issue and the resultant job specification is headed “Soulfresh Pty Ltd” and includes a requirement that the occupant of the position was to “work with other departments within Soulfresh”.
[14] On 18 August 2011 the applicant met with Mr Dubb and the employment agreement was executed. A copy of the document is at Annexure F to Exhibit Applicant 4. The parties to the agreement are expressed as being Soulfresh Pty Limited and the applicant. The agreement is signed by the applicant and by Mr Dubb underneath a rather prominent notation “Signed for and on behalf of Soulfresh Pty ACN 94 109 487 952” (sic).
[15] It is Mr Dubb’s evidence that he had been provided with a copy of the standard employment contract for a sales representative used by Soulfresh. He states that he takes full responsibility for failing to replace the name of Soulfresh with that of Karma Goods. Mr Dubb testified that he is not authorised to sign documents on behalf of Soulfresh.
[16] Mr Dubb provided copies of letters of engagement of two other employees to show the usual way in which employees are hired by Karma Goods, Annexure GDD-2 to Exhibit Respondent 1.
[17] The applicant commenced employment on 29 August 2011.
[18] The applicant’s evidence is that she was never informed that the employment contract was invalid or that it had been signed by the wrong party. Her evidence is that, when she received the draft agreement, it confirmed her view that Soulfresh was to be her employer. She testified that she had no reason to question Mr Dubb’s capacity to sign the agreement on behalf of Soulfresh.
[19] All of the payslips which were issued to the applicant during her employment were in the name of Soulfresh NSW with the ABN as set out in the employment agreement and in paragraph 14 above. The applicant’s bank statements reflect “Soulfresh P/L” as the payer of her wages.
[20] Mr Dubb’s evidence is that the name of Soulfresh NSW on the payslips was due to actions of the payroll administration staff who did this to accommodate the terms of the software licence. He says there is no such entity as “Soulfresh NSW” and the use of the ABN for Soulfresh was a clerical error. He denied that the words “Soulfresh NSW” were used to show that the businesses had merged or that Karma Goods had become part of Soulfresh.
[21] Mr Dubb’s evidence is that the applicant lodged a workers’ compensation claim in early 2012. The report of the payments made from the insurance agent show the employer as Karma Goods Pty Ltd, Annexure GDD-5 to Exhibit Respondent 1. He testified that the workers’ compensation policy was in the name of that entity.
[22] The applicant’s business cards were provided to her shortly after she commenced employment. A sample is at Exhibit Applicant 2. It shows her job title as “Soul Sister”, the words “Soul Fresh” are displayed in very large decorative print and the email details are given as “soulfresh.com.au”. On the other hand, Mr Dubb’s evidence is that the applicant’s email address during her employment was “karmagoods.com.au” and the email signature on her mobile phone which she set up herself listed Karma Goods as the company she represented, Annexures GDD-6 and GDD-7 to Exhibit Respondent 1.
[23] The signature footer at the base of each employee’s, and Mr Dubb’s, emails shows both Soulfresh and Karma Goods logos together with the logos of various products which each company distributes.
[24] Mr Dubb’s evidence is that all of the orders taken by and all of the invoices issued by the applicant were in the name of Karma Goods and displayed its ABN, Annexure GDD-8 to Exhibit Respondent 1.
[25] The applicant was invited to attend a Sales Conference and Christmas party in Melbourne in December 2011. The invitation to this event from Mr Dubb refers to “all SF employees”, Annexure L to Exhibit Applicant 4.
[26] It is Mr Dubb’s evidence that, during the period of her employment, the applicant was directed by and directly reported to him. She was not subject to any direction or control by or on behalf of Soulfresh. In contrast, the applicant’s evidence is that she received direction from both the General Manager and State Manager (Victoria/Tasmania) for Soulfresh. She testified that many of the decisions were made by Soulfresh management and were conveyed to her through Mr Dubb.
[27] The applicant’s evidence is that she believes that Mr Dubb is a director of Soulfresh. He attended Soulfresh Board meetings and referred to a meeting of that Board when he informed the applicant that her employment was to be terminated on 9 May 2012. The applicant’s evidence is that the decision to dismiss her was made by the Soulfresh Board.
[28] The letter of termination, Annexure H to Exhibit Applicant 4 is signed by Mr Dubb as Director. It is on letterhead showing the logos referred to in paragraph 23 above and displaying the name and ABN of Karma Goods but with the email and web addresses of “soulfresh.com.au”. The letter is in the following substantive terms.
“With regret, I am writing to terminate your employment with Karma Goods / Soul Fresh.
It was decided at a recent Board Meeting in Melbourne that we need to downsize the NSW Sales Team due to budgetary constraints. Unfortunately, the decision was made to reduce the sales staff and your role has been made redundant.
As per your employment agreement, dated 15/08/2011 (clause 16.1), please accept this letter as your 2 weeks’ notice, so termination of your employment will be effected at close of business on Wednesday 23rd May 2012.
I am sorry that we cannot offer you continued employment and wish you all the best for the future.”
[29] The applicant’s PAYG payment summary for the year ending 30 June 2012, Annexure GDD-3 to Exhibit Respondent 1, shows the payer as Karma Goods Pty Ltd with an ABN 77 094 993 763. I note that this document is dated 1 July 2012, after the applicant lodged her claim.
SUBMISSIONS
[30] Both parties provided written outlines of submissions prior to the hearing. Both the applicant and Mr Ganly also made oral submissions.
[31] Soulfresh submits that the application against it should be dismissed. It was not the applicant’s employer. Her employer was Karma Goods. These companies are completely separate entities. The management agreement between Soulfresh and Karma Goods was made with the intention of merging the two enterprises however that has not yet happened.
[32] The close involvement of the Soulfresh team and Mr Lo was due to the fact that Mr Dubb had not previously engaged a dedicated grocery team and he needed assistance to develop this part of the business. It is this involvement which led to the error in providing the applicant with the employment contract in the name of Soulfresh.
[33] Mr Ganly submitted that, because Mr Dubb had no authority to sign the contract on behalf of Soulfresh, it was null and void. He also submitted that the applicant was aware that Mr Lo was the CEO of Soulfresh. The absence of his signature on the contract should have been a “red flag” to the applicant.
[34] Mr Ganly noted that the applicant had never been told that she was to be employed by Soulfresh. The applicant was subject to the direction of Mr Dubb, not Soulfresh, and represented herself to others as being part of Karma Goods. Mr Ganly submitted that the Soulfresh Christmas party was not exclusively for Soulfresh employees so the fact that the applicant was invited was not definitive.
[35] The applicant submits that Soulfresh was her employer and that its jurisdictional objection should be dismissed. The applicant submits that several factors support her proposition that Soulfresh was the employer: the employment agreement; the pay slips and bank statements; the business cards; the active involvement of the CEO of Soulfresh in her recruitment; her invitation to the Sales Conference and Christmas party as a Soulfresh employee; and her dismissal by the Soulfresh Board.
[36] The applicant submits that the businesses of Soulfresh and Karma Goods had merged. This is borne out by: Mr Dubb’s explanation of the merger at the initial interview; the notification of the merger to customers including Ms Calvert; the conjoined use of the two business names in documents; the use of the logos on emails; advice to the applicant about the reporting structure; Mr Dubb’s referral to Melbourne for decisions; the description of the Sydney operation; the website; Mr Lo’s profile on an online business directory; and the notice of termination provided by the Soulfresh Board.
[37] Further, the applicant submits that the evidence of Mr Dubb that the two businesses are separate entities should be rejected because: Mr Dubb attended Soulfresh Board meetings; his title was NSW State Manager; the Karma Goods’ website reverts to that of Soulfresh; employee email addresses show as Soulfresh; Mr Dubb’s profile on an online business directory; and the wording of the letter of termination.
[38] The applicant also submits that Mr Dubb’s evidence as to mistakes and clerical errors in the employment contract and the pay slips should be rejected as Mr Lo had received the draft employment contract before it was executed; he had provided the applicant with the job specification which referred to Soulfresh; the respondent had relied on the employment contract during the employment period and at termination. None of the alleged errors had been raised prior to this claim being made.
[39] The applicant submits that, contrary to Mr Dubb’s evidence, she was subject to direction by Soulfresh management and by Mr Dubb as the NSW State Manager. She noted that the PAYG summary had been created after her dismissal.
CONCLUSIONS
[40] The question to be determined is whether Soulfresh was the applicant’s employer. As is apparent from the summary of the evidence, there are some factors which point towards Soulfresh as the employer and there are others which point towards Karma Goods as the employer.
[41] By signing the employment agreement Mr Dubb represented himself to the applicant as having the necessary authority to enter into such a relationship on behalf of Soulfresh. Neither he nor Soulfresh did anything to indicate to the applicant during her employment that there had been any mistake. The applicant relied on Mr Dubb’s representations.
[42] The letters of engagement of the two Karma Goods’ employees at Annexure GDD-2 to Exhibit Respondent 1 indicate that the applicant’s employment was not dealt with in the way in which Karma Goods usually engaged new employees. This reinforces the point that she was not employed by Karma Goods but by Soulfresh.
[43] I accept the applicant’s evidence as to the manner in which she was directed during the course of her employment and the close involvement of Mr Lo in her recruitment. It is of note that Soulfresh did not call Mr Lo to give evidence in the proceedings.
[44] I also accept that the applicant was dismissed as a result of a decision taken by the Board of Soulfresh. Mr Dubb did not deny the evidence to this effect in the applicant’s witness statement and it is further supported by the terms of the letter of dismissal set out at paragraph 28 above.
[45] On balance I have concluded that the applicant was employed by Soulfresh Pty Limited. The objection to the applicant’s claim is dismissed. The matter will be referred for arbitration.
COMMISSIONER
Appearances:
A. Trevelyan, the applicant.
B. Ganly for the respondent
Hearing details:
2012.
Sydney.
September 14.
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