Ms Evangeline Ireland v Lumigold Pty Ltd
[2024] FWC 3378
•23 DECEMBER 2024
| [2024] FWC 3378 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Ms Evangeline Ireland
v
Lumigold Pty Ltd
(U2024/5742)
| COMMISSIONER JOHNS | MELBOURNE, 23 DECEMBER 2024 |
Application for an unfair dismissal remedy - jurisdictional objections - Minimum Employment Period - casual employee - Small Business Fair Dismissal Code - objections dismissed
On 21 May 2024, Ms Evangeline Ireland (Applicant) made an application to the Fair Work Commission (Commission) pursuant to s.394 of the Fair Work Act 2009 (FW Act) for a remedy in respect of her dismissal by Lumigold Pty Ltd (Respondent).
On 30 May 2024, the Respondent filed a response to the unfair dismissal application. In its response, the Respondent objected to the Commission exercising jurisdiction in relation to the application on the basis that, it submitted:
a) the Applicant did not meet the minimum employment period (MEP Objection),
b) the Applicant was not dismissed (Not Dismissed Objection), and
c) the Respondent is a small business who complied with the Small Business Fair Dismissal Code (SBFDC Objection).[1]
The proceedings
On 1 October 2024 I conducted a determinative conference to decide the Jurisdictional Objections (JO DC). In advance of the JO DC, the parties filed materials which were compiled in a Digital Tribunal Book (DTB). For completeness, I set out the below materials that were relied upon the parties. I have had regard to all these materials in coming to this decision:
| Exhibit | Document title | Date |
| 1 | Form F2 | 21-05-2024 |
| 1.1 | “Email from deputy showing that my employer immediately removed my shifts after sending dismissal” | Undated |
| 1.2 | “Email from employer responding to my request for unpaid wages” | Undated |
| 2 | Form F3 and attachments | 30-05-2024 |
| 2.1 | Small Business Fair Dismissal Code | Undated |
| 2.2 | Form F3 | 30-05-2024 |
| 3 | Email from Respondent attaching submissions | 26-08-2024 |
| 3.1 | Second email from Respondent attaching submissions | 26-08-2024 |
| 3.2 | Third email from Respondent attaching submissions | 26-08-2024 |
| 4 | Email from Applicant attaching submissions | 11-09-2024 |
| 4.1 | List of documents | 11-09-2024 |
| 4.2 | Outline of argument - jurisdiction | 11-09-2024 |
| 4.3 | Outline of argument - merits | 11-09-2024 |
| 4.4 | Statement of Evidence | 11-09-2024 |
| 4.5 | Email to Respondent re underpayment of wages | 15-05-2024 |
| 4.6 | Email from Respondent re underpayment of wages | 15-05-2024 |
| 4.7 | Email to Respondent re underpayment of wages | 15-05-2024 |
| 4.8 | Statement of attainment | 22-08-2018 |
| 4.9 | Training acknowledgment form | 30-08-2023 |
| 50 | Photographs as attachment | Various |
Prior to the JO DC, my Associate called the representative of the Respondent, Ms Shixian Feng, to ask if she required an interpreter. Ms Feng chose to proceed without one.
The JO DC was conducted by video using Microsoft Teams. At the JO DC, the Applicant represented herself, and the Respondent was represented by Ms Feng.
During the JO DC, I rejected the MEP Objection and Not Dismissed Objection. My reasons for those decisions follow. So too my decision to now also reject the SBFDC Objection.
Factual circumstances
The following factual matters were either agreed upon or not contested by the parties. Consequently, I make the following findings:
a) The Applicant commenced her employment at Wild Rose Cottage (Previous Owner) in April 2018. At that time Wild Rose Cottage was under the ownership of Prudence Ireland (the Applicant’s relative – not that that relationship is important).[2]
b) The Applicant worked as a casual employee for over six years. During this time, the Applicant was paid at Level 3 under the Restaurant Award.[3]
c) On 26 April 2024 (Transfer Date), the Respondent, Lumigold Pty Ltd, purchased the business of Previous Owner as a “Going Concern”.[4]
d) As part of the transition, the Respondent, the Previous Owner offered to roster the Applicant and other staff for the first two weeks after the transmission of business.[5] The Respondent agreed. A consequence of this arrangement was that the employees of the Previous Owner became the employees of the Respondent on Transfer Date (although they may not have been rostered on that date).
e) Prior to the employees of the Previous Business becoming employees of the Respondent, it did not provide any written notification to incoming employees (including the Applicant) giving them notice that their previous service with the Previous Owner would not be recognised by the Respondent.[6] The import of that decision not to give such notice is discussion further below.
f) On 5 May 2024, Ms Feng informed the Applicant via WhatsApp that her payrate would be reduced to $30.10 per hour (at Level 2 of the Restaurant Award), including for Saturdays and Sundays.[7]
g) The Applicant objected to the pay adjustment for the weekends on the basis that it was below the legal minimum wage but said that she would continue to work the weekday shifts (First Exercise of a Workplace Right).[8]
h) On 15 May 2024, after receiving her payslip, the Applicant identified that her pay was below the award rates for her classification (she claimed that she should be paid at the Level 3 rate).[9] That same evening, at 7:50 pm, she emailed the Respondent outlining her concerns about underpayment (Second Exercise of a Workplace Right).[10]
i) The Respondent replied at 7:57 pm, Ms Feng asserted that the revised pay was non-negotiable and warned that,
“if you don’t accept that, I can cancel all of the coming work hours for you.”[11] (Threat of Adverse Action).
j) Less than half an hour later, at 8:22 pm, the Threat of Adverse Action was actioned when the Applicant received an automated notification from “Deputy” (a roster management system), notifying her that all her shifts between 16 – 24 May 2024 had been removed.[12]
k) Subsequently, the Applicant noted that she was also removed from the group chat used for workplace communication.[13]
l) In the 6 months prior to the cessation of her employment with the Respondent, the Applicant was paid (primarily by the Previous Owner) between $350.14 and $563.94 per week (on average, $457.04).
Evidence
In support of her application, the Applicant filed a witness statement that outlined her employment history at Wild Rose Cottage, her duties and responsibilities, and the circumstances leading to her dismissal.[14] I found Ms Ireland to be a witness of truth. Most of her evidence is uncontroverted.
In contrast Ms Feng was argumentative (arguing a point rather than answering a question) and obstinate. For someone who professed to “know the law, know what’s wrong and right, how the employee would like to be treated…”[15] she demonstrated none of that knowledge. She has a “my way, or the highway” attitude to employment and completely fails to understand an employee’s right to raise workplace issues (especially concerning pay).
The Applicant also provided copies of email correspondence that was exchanged between herself and the Respondent on 15 May 2024, in which she raised concerns about being underpaid.[16] In response, the Respondent threatened to cancel her shifts if she did not accept the new pay rate. The Applicant also submitted screenshots from the roster management system, Deputy, which showed that all her shifts for 16 – 24 May 2024 were cancelled shortly after the Applicant complained about being underpaid.[17]
Prudence Ireland, the previous owner of Wild Rose Cottage, submitted a witness statement that confirmed the Applicant was employed at the café for over six years. She said that she sold the business to Ms Feng as a “Going Concern”, which included all the stocks and equipment associated with the operation of the business. She stated that at the Respondent’s request she rostered all the staff as usual for the first two weeks after the settlement date.[18]
Elissa Hart, former Supervisor at the Wild Rose Cottage, also submitted a witness statement in support of the Applicant. Ms Hart worked with the Applicant for six years and described her as a reliable and well-liked employee who always carried herself with respect and courtesy.[19]
The Respondent filed copies of the same email correspondence as above as well as an unfilled and unsigned Small Business Fair Dismissal Code checklist.
Does the Applicant’s employment meet the minimum employment period?
During the JO DC, I decided that the Applicant had met the minimum employment period. These are my reasons.
Section 382 provides as follows:
382 When a person is protected from unfair dismissal
A person is protected from unfair dismissal at a time if, at that time:
(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; …
Section 383 of the FW Act defines what a minimum employment period is and provides that for an employer who is not a small business, the period is 6 months ending at the time the person was given notice of dismissal or immediately before the dismissal (whichever time is earlier). For a small business, the minimum employment period is 12 months. It was not in dispute between the parties[20], and I so find, that the Respondent was a small business. Therefore, the minimum employment period for the Applicant was 12 months.
The Respondent submitted that the Applicant did not meet the minimum employment period required to bring an unfair dismissal claim. It asserted that the Applicant had only worked for approximately three days and 20 hours, which fell short of the 12-month minimum employment period applicable to small businesses under the Act.[21] Further, the Respondent submitted that the Applicant’s prior service with the previous owners of Wild Rose Cottage should not be recognised as the purchase of the business did not include an obligation to retain staff (although the Respondent did retain staff, including the Applicant).
Should the Applicant’s prior service with the previous owners of Wild Rose Cottage be recognised?
The relevant provisions of the Act are as follows:
“Section 22 Meanings of service and continuous service
......
When service with one employer counts as service with another employer
(5) If there is a transfer of employment (see subsection (7)) in relation to a national system employee:
(a) any period of service of the employee with the first employer counts as service of the employee with the second employer; and
(b) the period between the termination of the employment with the first employer and the start of the employment with the second employer does not break the employee’s continuous service with the second employer (taking account of the effect of paragraph (a)) but does not count towards the length of the employee’s continuous service with the second employer.
Note: This subsection does not apply to a transfer of employment between non-associated entities, for the purpose of Division 6 of Part 2-2 (which deals with annual leave) or Subdivision B of Division 11 of Part 2-2 (which deals with redundancy pay), if the second employer decides not to recognise the employee’s service with the first employer for the purpose of that Division or Subdivision (see subsections 91(1) and 122(1)).
(6) If the national system employee has already had the benefit of an entitlement the amount of which was calculated by reference to a period of service with the first employer, subsection (5) does not result in that period of service with the first employer being counted again when calculating the employee’s entitlements of that kind as an employee of the second employer.
Note: For example:
(a) the accrued paid annual leave to which the employee is entitled as an employee of the second employer does not include any period of paid annual leave that the employee has already taken as an employee of the first employer; and
(b) if an employee receives notice of termination or payment in lieu of notice in relation to a period of service with the first employer, that period of service is not counted again in calculating the amount of notice of termination, or payment in lieu, to which the employee is entitled as an employee of the second employer.
Meaning of transfer of employment etc.
(7) There is a transfer of employment of a national system employee from one national system employer (the first employer) to another national system employer (the second employer) if:
(a) the following conditions are satisfied:
(i)the employee becomes employed by the second employer not more than 3 months after the termination of the employee’s employment with the first employer;
(ii)the first employer and the second employer are associated entities when the employee becomes employed by the second employer; or
(b) the following conditions are satisfied:
(i)the employee is a transferring employee in relation to a transfer of business from the first employer to the second employer;
(ii)the first employer and the second employer are not associated entities when the employee becomes employed by the second employer.
Note: Paragraph (a) applies whether or not there is a transfer of business from the first employer to the second employer.
(8) A transfer of employment:
(a) is a transfer of employment between associated entities if paragraph (7)(a) applies; and
(b) is a transfer of employment between non-associated entities if paragraph (7)(b) applies.
Section 91 Transfer of employment situations that affect entitlement to payment for period of untaken paid annual leave
Transfer of employment situation in which employer may decide not to recognise employee’s service with first employer
(1) Subsection 22(5) does not apply (for the purpose of this Division) to a transfer of employment between non-associated entities in relation to an employee, if the second employer decides not to recognise the employee’s service with the first employer (for the purpose of this Division).
Employee is not entitled to payment for untaken annual leave if service with first employer counts as service with second employer
(2) If subsection 22(5) applies (for the purpose of this Division) to a transfer of employment in relation to an employee, the employee is not entitled to be paid an amount under subsection 90(2) for a period of untaken paid annual leave.
Note: Subsection 22(5) provides that, generally, if there is a transfer of employment, service with the first employer counts as service with the second employer.
Section 384 Period of employment
(1) An employee’s period of employment with an employer at a particular time is the period of continuous service the employee has completed with the employer at that time as an employee.
(2) However:
(a) a period of service as a casual employee does not count towards the employee’s period of employment unless:
(i)the employment as a casual employee was on a regular and systematic basis; and
(ii)during the period of service as a casual employee, the employee had a reasonable expectation of continuing employment by the employer on a regular and systematic basis; and
(b) if:
(i)the employee is a transferring employee in relation to a transfer of business from an old employer to a new employer; and
(ii)the old employer and the new employer are not associated entities when the employee becomes employed by the new employer; and
(iii)the new employer informed the employee in writing before the new employment started that a period of service with the old employer would not be recognised;
the period of service with the old employer does not count towards the employee’s period of employment with the new employer.”
What occurred between the Previous Owner and the Respondent was a transfer of business between non-associated entities in accordance with s.22(8). Upon transfer of the trading name and assets, the nature of the business was unchanged. There was a transfer of employment in accordance with Section 22(7)(b). The Applicant was employed in the business:
a) before the transfer between non-associated entities, and
b) after the transfer.
Section 384(2)(b) provides that the period of service with the old employer does not count if the new employer informed the employee in writing before the new employment started that the period of service will not be recognised. If this has not occurred, then Section 384(2)(b) does not apply to the Applicant and pursuant to Section 22(5)(a) the period of service with the first employer (i.e. the Previous Owner) counts towards the period of continuous service.
Ms Feng for the Respondent accepted in response to my question during proceedings that neither her nor anyone on behalf of the Respondent informed the Applicant in writing before the employment started that the period of service with the Previous Owner would not be recognised.[22]
On 15 May 2024, the Respondent sent an email to the Applicant where she threatened to cancel the Applicant’s shift after the Applicant complained of being underpaid,
“I don’t know where you get the knowledge you should be paid by that rate. Since you’re willing to work in my company, I evaluate your skills and contributions at level 2, so that’s the casual rate for you.
If you don’t accept that, I can cancel all the coming working hours for you.
Best luck”.
This email clearly uses the present tense to describe the Applicant’s employment. It is clear that it is the Respondent who is cancelling currently allocated shifts. The fact that the period of employment with the Respondent was short does not alter this fact.
Does the Applicant’s status as a casual count towards her MEP?
Was the Applicant’s employment regular and systematic? – (section 384(2)(a)(i))
Recently, in Nehemiah Kamanda v House with No Steps [2016] FWC 767, Commissioner Saunders correctly and usefully articulated the relevant legal principles relating to the period of service for a casual employee as follows:
[4] It is the employment that must be on a regular and systematic basis, not the hours worked.[23] However, a clear pattern or roster of hours is strong evidence of regular and systematic employment.[24]
[5] The absence of any contractual requirement for the employee to work at set times or of any assumption that the employee be present on a daily, weekly, or monthly basis unless told otherwise does not preclude a finding that the employee’s engagements were regular and systematic.[25]
[6] The term “regular” should be construed liberally.[26] It implies some form of repetitive pattern and does not mean frequent, often, uniform, or constant.[27] Employment on a “regular” basis may be constituted by frequent though unpredictable engagements.[28]
[7] The term “systematic” requires that the engagement be “something that could fairly be called a system, method or plan”.[29] The concept of engagement on a “systematic” basis does not require the employee to be able to foresee or predict when his or her services may be required. It is sufficient that the pattern of engagement occurs as a consequence of an ongoing reliance on the employee’s services as an incident of the business by which he or she is engaged.[30]
[8] In Ponce, Commissioner Roe stated (at [76]):
“In situations where there is not a clear pattern or roster of hours and days worked or a clear agreed arrangement between the employer and the employee, then evidence of regular and systematic employment can be established where:
· The employer regularly offers work when suitable work is available at times when the employer knows that the employee has generally made themselves available; and
· Work is offered and accepted sufficiently often that it could no longer be regarded as simply occasional or irregular.”
[9] I agree with the approach taken by Commissioner Roe in Ponce, subject to the following caveat identified by Vice President Lawler in Burke v Marist Brothers St Joseph’s College t/a St Joseph’s College (at [18]):[31]
“That caveat is that one must not treat the summary of Roe C as a substitute for the language of the statute: the ultimate question always remains whether the employment was ‘regular and systematic’ within the meaning of section 384(2)(a) and care must be taken not to invert the test to one which asks the question whether the employment was ‘occasional or irregular’.”
In considering the evidence in the present matter, I adopt the orthodox approach outlined above by the very learned Commissioner.
The uncontroverted evidence is that the Applicant’s employment with the Previous Owner was regular and systematic since April 2018. By agreement with the Previous Owner and the Respondent, the Applicant was then rostered to work after the transmission of business.
Did the Applicant have a reasonable expectation of continuing employment by the employer on a regular and systematic basis? - (section 384(2)(a)(ii))
Having regard to:
a) the past employment of the Applicant with the Previous Owner,
b) the agreement of the Respondent to accept continuing employment as rostered by the Previous Owner,
c) there being no written correspondence from the Respondent to the Applicant,
i.making statements about the non-recognition of prior service,
ii.indicating that the Applicant should expect any change to her working experience (including patterns of work),
I find that the Applicant had a reasonable expectation of continuing employment with the Respondent.
Consequently, for the reasons above, I find that the Applicant served the minimum employment period required to bring an unfair dismissal claim. The Respondent’s jurisdictional objection in this regard is therefore dismissed.
Was the Applicant dismissed?
A dismissal is unfair if the Commission is satisfied, on the evidence before it, that all of the circumstances set out at s.385 of the FW Act existed. Section 385 provides the following:
“385 What is an unfair dismissal
A person has been unfairly dismissed if the FWC is satisfied that:
a)the person has been dismissed; and
b)the dismissal was harsh, unjust or unreasonable; and
c)the dismissal was not consistent with the Small Business Fair Dismissal Code; and
d)the dismissal was not a case of genuine redundancy.
Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.”
A person has been unfairly dismissed if the termination of their employment comes within the definition of “dismissed” for purposes of Part 3–2 of the FW Act. Section 386 of the FW Act provides that:
“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.”
The Respondent submitted that the Applicant was not dismissed, claiming that she was a casual employee who could return to work whenever she wanted.[32]
However, the evidence does not support this conclusion. Approximately 30 minutes after the Applicant emailed the Respondent to raise concerns about underpayment, the Respondent cancelled all of the Applicant’s scheduled shifts.[33] It was direct and deliberate adverse action taken by the Respondent against the Applicant because the Applicant had exercised her workplace rights.
During the hearing, the Respondent admitted to advertising new positions at the café.[34] Moreover, the Applicant stated – something that the Respondent did not dispute – that no attempts were made to offer her additional shifts after the cancellation.[35] The Applicant also submitted that she was removed from the workplace communication group chat after the Respondent cancelled her shifts[36], a claim that the Respondent did not refute.
Accordingly, for these reasons I was satisfied, that based on the evidence before me, that on 15 May 2024 (through the actions of Ms Feng), the Respondent dismissed the Applicant from her employment. Consequently, the Commission as presently constituted found that the Applicant was terminated at the initiative of the Respondent.
Was the dismissal consistent with the Small Business Fair Dismissal Code?
A person has not been unfairly dismissed where the dismissal is consistent with the Small Business Fair Dismissal Code (Code). It is useful to set out s.388(2) of the FW Act:
“388 The Small Business Fair Dismissal Code...
(2) A person’s dismissal was consistent with the Small Business Fair Dismissal Code if:
a)immediately before the time of the dismissal or at the time the person was given notice of the dismissal (whichever happened first), the person’s employer was a small business employer; and
b)the employer complied with the Small Business Fair Dismissal Code in relation to the dismissal.”
As stated above the Commission has found the Respondent to be a small business within the meaning of section 23 of the FW Act.
The Code was declared by the Minister for Employment and Workplace Relations on 24 June 2009:
“Small Business Fair Dismissal Code
Commencement
The Small Business Fair Dismissal Code comes into operation on 1 July 2009.Summary Dismissal
It is fair for an employer to dismiss an employee without notice or warning when the employer believes on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal. Serious misconduct includes theft, fraud, violence and serious breaches of occupational health and safety procedures. For a dismissal to be deemed fair it is sufficient, though not essential, that an allegation of theft, fraud or violence be reported to the police. Of course, the employer must have reasonable grounds for making the report.Other Dismissal
In other cases, the small business employer must give the employee a reason why he or she is at risk of being dismissed. The reason must be a valid reason based on the employee’s conduct or capacity to do the job.The employee must be warned verbally or preferably in writing, that he or she risks being dismissed if there is no improvement.
The small business employer must provide the employee with an opportunity to respond to the warning and give the employee a reasonable chance to rectify the problem, having regard to the employee’s response. Rectifying the problem might involve the employer providing additional training and ensuring the employee knows the employer’s job expectations.
Procedural Matters
In discussions with an employee in circumstances where dismissal is possible, the employee can have another person present to assist. However, the other person cannot be a lawyer acting in a professional capacity.A small business employer will be required to provide evidence of compliance with the Code if the employee makes a claim for unfair dismissal to Fair Work Australia, including evidence that a warning has been given (except in cases of summary dismissal). Evidence may include a completed checklist, copies of written warning(s), a statement of termination or signed witness statements.”
The Respondent submitted that it complied with the Code.
However, the evidence does not support that conclusion. First, the Applicant was not accused of theft, fraud, violence, or serious breaches of health and safety procedures. Second, the Respondent did not provide the Applicant with any reason for her dismissal. Third, the Applicant received no warning that she was at risk of being dismissed. Fourth, the Applicant was not given an opportunity to respond or to fix any alleged issues. Finally, the circumstances of the dismissal did not allow the Applicant to have a support person present.
It is clear from the undisputed evidence that the Respondent did not comply with the Code.
What actually occurred here is best summarised in the Respondent’s Form F3. In response to the present application, the Respondent explained the reason for dismissal as follows,
“… the reason I cancelled her shift is she sent over two formal emails with unpaid and no-break complain (sic), although I was shocked with surprise, I have to cancel and stop she come in as she is such unhappy to work in and with me.”
“Since she is unhappy and complaining with me formally, I would imagine any business owner would let any staff like that to come in and work again. Same to me.”
That is to say, the Applicant exercised workplace rights, and the Respondent unceremoniously sacked her.
Accordingly, the Applicant’s jurisdictional objection that it complied with the Code is rejected.
Conclusion
Having dismissed the Respondent’s jurisdictional objections above, I am satisfied that the Applicant is protected from unfair dismissal. An Order to that effect, [PR782758], will be issued separately.
The matter will be listed for a mentions and directions hearing at 3.00 pm on 6 January 2025 to program the substantive unfair dismissal matter for a further hearing to determine its merits.
COMMISSIONER
Appearances:
Both the Applicant and Respondent were self-represented.
Hearing details:
1 October 2024 at 3:00 pm via video on Microsoft Teams.
[1] Form F3, pg. 24 DTB.
[2] DTB, pg. 6.
[3] PN91.
[4] PN27-32.
[5] PN33.
[6] PN36.
[7] DTB, pg. 108.
[8] DTB, pg. 109.
[9] DTB, pg. 99.
[10] Ibid.
[11] DTB, pg. 100.
[12] DTB, pg. 106.
[13] PN106.
[14] DTB, pg. 95.
[15] DTB, pg. 29.
[16] DTB, pg. 99 – 101.
[17] DTB, pg. 106.
[18] DTB, pg. 96.
[19] DTB, pg. 97.
[20] DTB, pg. 25 and 62.
[21] DTB, pg. 25.
[22] PN36.
[23] Yaraka Holdings Pty Ltd v Giljevic (2006) 149 IR 399 (Yaraka) at [65]; cited in Ponce v DJT Staff Management Services Pty Ltd t/a Daly’s Traffic[2010] FWA 2078 (Ponce).
[24] Ibid.
[25] Yaraka at [67].
[26] Yaraka at [68].
[27] Yaraka at [68]; cited in Grives v Aura Sports Pty Ltd[2012] FWA 5552 at [32].
[28] Yaraka at [89].
[29] Yaraka at [68].
[30] Yaraka at [69].
[31] [2015] FWC 7324.
[32] PN64.
[33] DTB, pg. 106.
[34] PN81.
[35] PN106.
[36] Ibid.
MEU and Wilpinjong Coal
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