Ms Gay Kelly v Dhauward-Wurrung Portland & District Aboriginal Elderly Citizens Inc T/A Dhauward-Wurrung Elderly & Community Health Service Inc

[2017] FWC 312

[2017] FWC 312

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.365 - Application to deal with contraventions involving dismissal

Ms Gay Kelly
v
Dhauward-Wurrung Portland & District Aboriginal Elderly Citizens Inc T/A Dhauward-Wurrung Elderly & Community Health Service Inc
(C2016/7281)

COMMISSIONER RIORDAN SYDNEY, 25 JANUARY 2017

Application to deal with contraventions involving dismissal.

[1] This decision relates to a general protections application in accordance with section 365 of the Fair Work Act 2009 (the Act) by Ms Gay Kelly (the Applicant) in relation to her termination by the Dhauward – Wurrung Portland & District Aboriginal Elderly Citizens Inc trading as Dhauward – Wurrung Elderly & Community Health Service Inc (the Respondent).

[2] The Act provides that a person who has been dismissed and who applies to the Fair Work Commission (FWC) for it to deal with a general protections application pursuant to section 365 of the Act, must make the application within 21 days after the dismissal took effect. However, the FWC may allow a further period for the application to be made if the delay in lodgement was due to exceptional circumstances.

Section 366 Time for Application

(1) An application under section 365 must be made:

(a) within 21 days after the dismissal took effect; or

(b) within such further period as the FWC allows under subsection (2).

(2) The FWC may allow a further period if the FWC is satisfied that there are exceptional circumstances, taking into account:

(a) the reason for the delay; and

(b) any action taken by the person to dispute the dismissal; and

(c) prejudice to the employer (including prejudice caused by the delay); and

(d) the merits of the application; and

(e) fairness as between the person and other persons in a like position.

[3] Leave was granted in accordance with section 596(2) of the Act to allow Ms Holland of counsel to represent the Applicant and for Mr Drew from Drew Gleeson Legal to represent the Respondent.

Background

[4] Ms Kelly commenced work as a contractor for the Respondent as a finance manager working 2 days per week in August 2014. In February 2016, Ms Kelly took over the role of acting CEO, working 5 days per week.

[5] Ms Kelly sent an invoice from her company GK Booksense to the Respondent for her services every week from 10 August 2014 until 31 July 2016. The invoice from GK Booksense included a 10% GST charge when Ms Kelly acted as the CEO.

[6] Following a discussion between Ms Kelly and a Board Member of the Respondent, Mr Dennis Rowe, Ms Kelly made a file note which said:

“File Note dated 4 March 2016

The board voted unanimously to pay Gay Kelly at the same rate of pay as the previous CEO whilst in a caretaker role. It is noted this payment will be made as a contractor using Ms Kelly’s ABN. This rate of pay will apply from 12 February 2012 until the handover to the newly appointed CEO is complete.” 1

[7] A new CEO was subsequently appointed, Mr John Bell, in July 2016. Ms Kelly continued to work full time with Mr Bell as part of a handover/transition period. Ms Kelly took 2 weeks leave from 15 August 2016. Ms Kelly was not paid during this period.

[8] Ms Kelly’s fixed term contract was due to expire on 4 September 2016. Despite earlier comments from both the CEO and the Board that her 5 days a week contract would be extended, at a meeting on 31 August 2016, Ms Kelly was only offered her old position of finance manager working 2 days per week.

[9] Ms Kelly rejected this offer. Ms Kelly did not believe that the role could be performed in this timeframe. Ms Kelly removed her personal belongings from her office and returned her keys and phone to the Respondent on 1 September 2016.

[10] On 5 September, Ms Kelly sent an email to the CEO proposing a new arrangement which would allow Ms Kelly to perform the majority of her work off-site.

[11] The CEO has not responded to Ms Kelly’s proposal.

[12] Relevantly, the Respondent sent correspondence to Ms Kelly on 7 September 2016 and to GK Booksense on 28 October 2016 seeking reimbursement in relation to an alleged overpayment during Ms Kelly’s time as CEO.

[13] Ms Kelly made her general protections application to the FWC on 9 December 2016 claiming that she had been discriminated against by the Respondent.

Submissions

[14] Ms Holland argued that Ms Kelly’s employment as a contractor was a sham arrangement and that Ms Kelly had always been an employee of the Respondent. Also, Ms Kelly has never received any formal termination correspondence from the Respondent, nor did she receive any notice or payment in lieu.

[15] Ms Holland submitted that Ms Kelly only realised that she would not be re-engaged after receiving further correspondence from the Respondent on 28 October. Ms Kelly sought legal advice in relation to her situation on 9 November 2016. Ms Kelly’s representatives contacted the Respondent seeking a copy of her employment contract. The Respondent did not provide a copy of the contract until 23 November 2016.

[16] Mr Drew argued that Ms Kelly was not an employee but a contractor. Mr Drew submitted that all of the evidence supports this employment characterisation, namely:

a) Ms Kelly was never paid for any leave;
b) GK Booksense charged the Respondent for Ms Kelly’s services every week by way of an invoice;
c) Ms Kelly communicated to another contractor that she remained hopeful of becoming an employee; and
d) Ms Kelly was never given a payslip, nor was any income tax deducted from any payments that were made to GK Booksense.

[17] Mr Drew denied that Ms Kelly was not aware that the employment relationship had come to an end in early September because Ms Kelly had packed up her office and handed in her phone and keys.

[18] Mr Drew submitted that if Ms Kelly was an employee, then she should be treated like every other employee. Mr Drew argued that Ms Kelly is an experienced professional with a post graduate MBA who should have been aware or made the relevant enquiries in relation to the 21 day time limit to lodge a general protections application.

Statutory Provisions

[19] Section 366(2) of the Act states that the Commission may allow a further period for an applicant to make a general protections application involving a dismissal if the Commission is satisfied that there are “exceptional circumstances”, taking into account the following five criteria:

“(a) the reason for the delay; and

(b) any action taken by the person to dispute the dismissal; and

(c) prejudice to the employer (including prejudice caused by the delay); and

(d) the merits of the application; and

(e) fairness as between the person and other persons in a like position.”

[20] The principles to be followed in determining the existence of an exceptional circumstance are well established and are set out in a decision of a Full Bench of Fair Work Australia (as the national tribunal was then called) in Nulty v Blue Star Group.² In that matter the Full Bench held the following (at [13]) in relation to “exceptional circumstances”:

“In summary, the expression “exceptional circumstances” has its ordinary meaning and requires consideration of all the circumstances. To be exceptional, circumstances must be out of the ordinary course, or unusual, or special, or uncommon but need not be unique, or unprecedented, or very rare. Circumstances will not be exceptional if they are regularly, or routinely, or normally encountered. Exceptional circumstances can include a single exceptional matter, a combination of exceptional factors or a combination of ordinary factors which, although individually of no particular significance, when taken together are seen as exceptional. It is not correct to construe “exceptional circumstances” as being only some unexpected occurrence, although frequently it will be. Nor is it correct to construe the plural “circumstances” as if it were only a singular occurrence, even though it can be a one off situation. The ordinary and natural meaning of “exceptional circumstances” includes a combination of factors which, when viewed together, may reasonably be seen as producing a situation which is out of the ordinary course, unusual, special or uncommon.”

Consideration

Section 366(2)(a) - reason for the delay

[21] I have taken into account that Ms Kelly’s last day of work for the Respondent was on 1 September 2016 and that her fixed term contract expired on 4 September 2016.

[22] I have taken into account that GM Booksense has not sent an invoice to the Respondent since 31 July 2016.

[23] I have taken into account that Ms Kelly was finally of the view that her employment relationship with the Respondent had come to an end on 28 October 2016. I note that Ms Kelly did not file her application until 9 December 2016, some 42 days later.

[24] I have taken into account that it took Ms Kelly 12 days to seek legal advice on her situation after 28 October 2016. I note that Ms Kelly’s representative sought a copy of Ms Kelly’s employment contract from the Respondent, which was supplied on 23 November 2016. I note that it took a further 16 days for Ms Kelly to lodge her application.

Section 366(2)(b) - action taken by person to dispute the dismissal

[25] I have taken into account that Ms Kelly sent an email to the Respondent on 5 September 2016 with a new proposal in relation to her future employment.

[26] I have taken into account that there appears to be no follow up correspondence or attempted telephone contact from Ms Kelly to the Respondent in relation to her employment.

[27] I have taken into account that Ms Kelly sought legal advice in relation to her situation.

Section 366(2)(c) - prejudice to the employer

[28] It was held in Brodie-Hanns v MTV Publishing Ltd 3that prejudice to an employer will weigh against the granting of an extension of time. However, it is up to the employer to produce evidence that they would be prejudiced if an extension of time was granted.

[29] The Respondent has not produced any evidence or made any submissions in relation to this issue.

Section 366(2)(d) – merits of the application

[30] Ms Kelly claims that she has suffered loss as a result of discrimination because she was not an Aboriginal employee. The Respondent denied this accusation on the basis that Ms Kelly was offered her old job back with the same conditions.

[31] In Kornicki v Telstra-Network Technology Group 4 the Commission considered the principles applicable to the extension of time discretion under the former section 170CE(8) of the Workplace Relations Act 1996 (Cth). In that case the Commission said:

“If the application has no merit then it would not be unfair to refuse to extend the time period for lodgement. However we wish to emphasise that a consideration of the merits of the substantive application for relief in the context of an extension of time application does not require a detailed analysis of the substantive merits. It would be sufficient for the applicant to establish that the substantive application was not without merit.” 5

[32] Detailed evidence on the merits of a case are rarely dealt with at an extension of time hearing. As a result, the Commission “should not embark on a detailed consideration of the substantive case” for the purpose of determining whether to grant an extension of time to the applicant to lodge their Application.

[33] I adopt the reason in Kornicki in relation to the merit of Ms Kelly’s application.

[34] The issue of whether Ms Kelly was an employee or a contractor is a jurisdictional issue which rests in the domain of the Court.

[35] The merits of Ms Kelly’s application is a neutral consideration in these proceedings.

Section 366(2)(e) – fairness as between the person and other persons in a like position

[36] In James Morphett v Pearcedale Egg Farm, 6 Deputy President Gostencnik said;

“[29]…Cases of this kind will generally turn on their own facts. However, this consideration is concerned with the importance of an application of consistent principles in cases of this kind, thus ensuring fairness as between the Applicant and other persons in a similar position, and that consideration may relate to matters currently before the Commission or matters which had been previously decided by the Commission.”

[37] I am satisfied that this is not a relevant issue in these proceedings.

Conclusion

[38] I have taken into account all of the information and submissions that has been provided by the parties.

[39] I am satisfied that Ms Kelly has not proven that an exceptional circumstance existed to warrant the FWC granting an extension of time. Ms Kelly’s contract terminated on 4 September 2016. This date was well known to her. Ms Kelly refused to accept an on-going role on 31 August 2016 and handed back her keys, phone and collected her personal belongings from her office on 1 September 2016. This behaviour is typical of an employee who understands that their employment has been terminated. As a result, Ms Kelly’s application was 75 days out of time.

[40] Even if I were to accept Ms Kelly’s proposition that she finally realised that her employment relationship concluded on 28 October 2016, the application is still 21 days late. I do not accept that waiting for a copy of the employment contract fits within the definition of an exceptional circumstance. Also, I note that it took Ms Kelly 12 days to seek legal advice and then a further 16 days after the provision of her employment contract to make her application. This level of inactivity does not provide for an exceptional circumstance.

[41] Ms Kelly’s application for an extension of time is refused.

COMMISSIONER

 1 F8 Annexure C

2 [2011] 203 IR 1

 3 (1995) IR 298

 4   Print P3168, 22 July 1197 per Ross VP, Watson SDP and Gay C

 5   Ibid

 6   [2015] FWC 8885

Printed by authority of the Commonwealth Government Printer

<Price code C, PR589423>