Ms Gillian Wilson v B.A.R.B Trading T/A Gelatissimo Townsville

[2016] FWC 3841

[2016] FWC 3841

FAIR WORK COMMISSION

DECISION

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

Ms Gillian Wilson
v
B.A.R.B Trading T/A Gelatissimo Townsville
(U2016/2075)

SENIOR DEPUTY PRESIDENT RICHARDS BRISBANE, 4 JULY 2016

Small business employer – whether employed on a regular and systematic basis – casual employees – three elements require satisfaction – the “basis” of the relationship – whether regular - whether systematic - avoid conflation of distinguishable terms - meaning of incident of the business in context of demonstrating whether engagements systematic - Directors as employees – associated entities - minimum employment period.

[1] This decision concerns a jurisdictional objection to the hearing of an application by Ms Gillian Wilson under s.394 of the Fair Work Act 2009 (“the Act”). Ms Wilson seeks an unfair dismissal remedy arising from her dismissal for alleged performance issues in her capacity as a Shop Manager with B.A.R.B. Trading Pty Ltd T/A Gelatissimo Townsville (“the employer”). The employer contends that Ms Wilson’s period of employment did not meet the minimum requirements for a small business and that her application under s.394 of the Act should be dismissed as a consequence.

[2] The parties are in contest initially as to whether or not the employer is a small business for purposes of s.23 of the Act. If the employer is a small business for purposes of section 23 of the Act, the minimum period employment would be such as to render Ms Wilson’s application void (for reasons that Ms Wilson had not been employed for a 12 month continuous period).

[3] I set out the relevant legislative provisions immediately below.

Relevant Legislative Provisions

[4] The relevant jurisdictional objection is made under Division 2 of the Act. Section 382 of the Act, which 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; and

(b) one or more of the following apply:

(i) a modern award covers the person;

(ii) an enterprise agreement applies to the person in relation to the employment;

(iii) the sum of the person's annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold. [My emphasis]

[5] Section 383 of the Act provides the meaning of minimum employment period:

383 Meaning of minimum employment period

The minimum employment period is:

(a) if the employer is not a small business employer—6 months ending at the earlier of the following times:

(i) the time when the person is given notice of the dismissal;

(ii) immediately before the dismissal; or

(b) if the employer is a small business employer—one year ending at that time. [My emphasis]

[6] Section 384 of the Act defines the meaning of an employee's period of employment:

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.

[7] Section 23 of the Act (which I have cited earlier) defines the meaning of small business employer:

23 Meaning of small business employer

(1) A national system employer is a small business employer at a particular time if the employer employs fewer than 15 employees at that time.

(2) For the purpose of calculating the number of employees employed by the employer at a particular time:

(a) subject to paragraph (b), all employees employed by the employer at that time are to be counted; and

(b) a casual employee is not to be counted unless, at that time, he or she has been employed by the employer on a regular and systematic basis.

(3) For the purpose of calculating the number of employees employed by the employer at a particular time, associated entities are taken to be one entity.

(4) To avoid doubt, in determining whether a national system employer is a small business employer at a particular time in relation to the dismissal of an employee, or termination of an employee's employment, the employees that are to be counted include (subject to paragraph (2)(b)):

(a) the employee who is being dismissed or whose employment is being terminated; and

(b) any other employee of the employer who is also being dismissed or whose employment is also being terminated.

The Current Circumstances

[8] I am satisfied (and it was not contested by either party) that the employer meets the definition of an employer for the relevant Parts of the Act (those being Part 1-2 and Part 3-2).

[9] In the current case, there are 19 potential employees relevant for purposes of section 23 of the Act. They are:

● two Directors;

● Ms Wilson – the applicant;

● five part-time employees;

● five casuals who are school students (“the casual school students”);

● three other adult casuals (“the other casuals”);

● three casuals who were backpackers (“the backpacker casuals”).

Whether associated businesses included any employees

[10] Further to this, there is some argument as to whether there are any employees in the employers’ associated businesses, and whether a person who performs accounting services is an employee as well. I will deal with these latter classes of prospective employees initially.

[11] Mr Robert Orne-Gliemann gave evidence that he and his wife (Ms Astrid Orne-Gliemann) were Directors in a business known as Ingham Boat Hire. Mr Orne-Gliemann is also a Director another business, Hinchinbrook House Boat Hire.

[12] Neither business has any current employees at the time of Ms Wilson’s dismissal. The Directors do not draw a wage from the businesses, but reinvest any earnings into boat maintenance as a step towards growing the business. It appears that Mr Orne-Gliemann is responsible for interacting with clients, such that no employees are required.

[13] The associated entities, having common Directors exercising the requisite influence over the corporate mind, cannot be taken to be employees of the business, and there were no employees otherwise employed in the business. The existence of the associated entities does not give rise to any matter of significance for the current proceedings.

Status of Bookkeeper

[14] Ms Wilson claimed that there was a person who performed bookkeeping or accounts work for the employer and this person’s legal status needed to be confirmed. From the evidence before me, the person providing these services is the employer’s prospective daughter in law who is undergoing tertiary business-related studies. Her services are voluntary and informally provided on an ad hoc basis. There is no contract of employment between the employer and the person and there is no consideration provided in exchange for the services.

[15] The bookkeeper is not a person whose legal status is relevant to these proceedings.

Definition of Casuals

[16] These matters dealt with, I start from the premise that six of the employees at the particular time (that being the date on which Ms Wilson was dismissed) are taken to be employees for purposes of section 23 of the Act. These comprise of Ms Wilson along with the five part-time employees.

[17] The Act presumes each casual employee is not to be counted, for the purposes of determining if the employer is a small business, unless at the particular time, the casual employee is employed by the employer on a regular and systematic basis.

[18] The Act does not specifically define the meaning of casual employee although I note that for the purposes of this matter, neither party has contested each of the employees, that were labelled and paid as casual employees by the employer, were in fact casual employees for the purposes of this application (see also Telum Civil (Qld) Pty Ltd v CFMEU[2013] FWCFB 2434 (“Re: Telum”)). The Fast Food Industry Award 2010 [MA000003] (“the Award”) states at clause 13.1:

“A casual employee is an employee engaged as such.”

[19] Based upon the relevant indicia, including their employment conditions, pay rates and terms of engagement, the employees named as casual employees are casual employees, with reference to the Award (following the authority in Re: Telum).

Whether Employed by the Employer on a Regular and Systematic Basis

[20] In Yaraka Holdings Pty Limited v Giljevic [2006] ACTCA 6 (Yaraka) the Court of Appeal of the A.C.T. (Crispin P and Gray J) noted that the inclusion of the phrase “regular and systematic” had been;

“[64] […] drawn from provisions found in regulations under the Workplace Relations Act 1996 (Cth), particularly reg 30B […]”

[21] In Yaraka, Their Honours went on to note that it is not in reference to the specific hours worked, but rather the engagement itself, that the Court must be satisfied is “regular and systematic”. That is, the employment by the employer must be on regular and systematic basis.

“ [65] It should be noted that it is the "engagement" that must be regular and systematic; not the hours worked pursuant to such engagement […].”

[22] Importantly, both terms must be given their separate meaning in construing circumstances and applying the Act, and efforts must be made to avoid conflating the two distinguishable terms.

Regular

[23] In Yaraka at [68], Crispin P And Gray J (with whom Madgwick J agreed) further noted that the term “regular” should be construed liberally and noted the term may rightly be used as a synonym for “frequent” or “often” but not however for “uniform” or “constant”.

[24] The Commission is required to examine the engagement of the casual employees and determine that the engagement is made with an element of regularity by the employer at the particular time, in this case, the time of Ms Wilson’s dismissal.

Systematic

[25] It is not enough that the engagement be regular alone, as under the Act it must also be “systematic”.

[26] The element of “systematic engagement” as the second limb of the test under the Act is not synonymous with the requirement of regularity, but rather a separate element on its own to be assessed in the case of each employee.

[27] In Yaraka, Madgwick J referred to the need for evidence that the engagement was beyond merely frequent, or regular, but rather the exhibition of some kind of system or method or plan;

“[91] Engagement under contracts on a ‘systematic basis’ implies something more than regularity in the sense just mentioned, that is, frequency. The basis of engagement must exhibit something that can fairly be called a system, method or plan […]”

[28] However, it need not necessarily be that the employer has an obviously systematic or methodical approach to the engagement of the casual employee. In some circumstances systematic engagement might be consequential of engagement over a period of time by “a pattern of engagement that occurs as a consequence of an on-going reliance upon the worker’s services as an incident of the business by which he or she is engaged” as was the case in Yaraka per Crispin P And Gray J (with whom Madgwick J agreed) at [69].

[29] I discuss this in more detail below. In the case before their Honours, the employee concerned had been an employee for seven years, and this gave rise to a wider body of evidence as to ‘reliance’ than might normally be so.

[30] It is true that employers will engage casual employees with a clear method or plan or system in mind to meet certain business requirements and needs, or with an overriding goal in mind. However it is equally true that often businesses will employ casuals in the hope of only gaining the benefit of that employment for the particular engagement or engagements on which the employment is offered, and with no plan or method or system other than to meet the immediate needs of the business at a particular time or period. This type of engagement might often be on short notice or the basis of the engagement might be seen to even be “ad hoc” or “unmethodical” is so far as it arises largely in response to demand spikes, temporary and sporadic needs (such as in maintenance shut downs), or when otherwise anticipated labour is unavailable.

[31] In the present case it will be necessary to examine the actual basis to the engagement (see immediately below) of the relevant casual employees, for the purpose of finding the existence of a system or plan or method, that was applied in relation the casual employees, at the relevant time.

Basis

[32] An important consideration often ignored under section 23(2)(b) of the Act is the requirement that the regular and systematic engagement of the employees need be the “basis” for the employment at the relevant time.

[33] The Macquarie Dictionary sets out the meaning of basis, as a useful starting point for this analysis;

1. the bottom or base of anything, or that on which it stands or rests.

2. a groundwork or fundamental principle.

3. the principal constituent; a fundamental ingredient.

[34] The use of this word by Parliament indicates that the other elements described above, “regular and systematic”, need to be the foundation or fundamental principles upon which the employment relationship exists (as opposed to short-lived or temporary phenomenon).

[35] It is therefore insufficient for the purposes of the Act merely to demonstrate the existence of some kind of regularity and systematic employment of the casual employees. The Act requires a step further; that these elements be the basis, or foundation, or principle, of the employment engagement at the particular time, in this matter, the time of Ms Wilson’s dismissal.

[36] In stating that the basis of the relationship must be ascertained at the time of the dismissal, I note that the legal relationship can change over time, on express terms or by means of circumstances. This much was intended by Madgwick J in his supplementary judgment in Yaraka:

“[73] As a preface to outlining the factors that seem to me to have decisive weight, I make two general observations. The first is that, while the overall pattern of relationships between the parties is important, the crucial enquiry is as to the nature of the particular contract they entered into, and in fulfilment of which the respondent was working, at the time of his injury. The second is that, just as parties may, by the adoption of express terms, reflect change over time in the nature of their illegal relationships, circumstantial developments overtime may compel the view that, despite the lack of express, fresh adoption of terms that correspond with current reality, the real nature of the parties’ relationship has changed.” [My emphasis]

[37] When the basis of the casual employment relationship is examined, it is to be examined as it was at the particular time; that is, at the time of the dismissal. Other decisions of the Commission have held differently, and maintain that “the basis of the casual employee’s employment over the whole of the period of the casual employee’s employment with the Respondent” should be considered, as if an averaging formula of some kind might be applied to the changing contracts (see Grives v Aura Sports Pty Ltd (2012) FWA 5552 per Jones C at [27]). Additional complications arise when the contracts have a different basis – such as part time and casual.

[38] I commence my consideration by examining the circumstances of the three backpacker casuals with reference to the basis of their engagement being both regular and systematic, as outlined above.

The Backpacker Casual Employees

[39] The respondent argued that the backpacker casuals should not be held to be employed on a regular and systematic basis. Its evidence was that overseas backpackers would frequently attend the business premises seeking short term employment to assist their further travels around Australia. It was estimated that around 30 backpackers a week would request employment opportunities and any employment engagement by the employer was on an ‘ad hoc’ basis and always short term. At the time of Ms Wilson’s dismissal there were three backpacker casuals employed by the employer.

[40] On the evidence before me, one backpacker casual, by the name of “Sharon”, was employed on 21 April 2016 and completed three shifts comprising 12 hours of work (not accounting for a three hour training course) by the date of Ms Wilson’s dismissal on 27 April 2016. Sharon, the casual backpacker, resigned her employment the day after Mr Wilson was dismissed and performed no other duties for the employer.

[41] Sharon, the casual backpacker, cannot be taken to have been a regular casual employee at the time of Ms Wilson’s dismissal. Her hours of work were variable and irregular (over the short period of employment) or her periods of employment or engagements were not regular or frequent. The engagement was not of sufficient duration to indicate that it had a systematic basis and reflected no pattern or plan.

[42] Another backpacker casual, by the name of “Max”, completed six shifts up to and including the date of this Wilson’s dismissal. Max, the casual backpacker, completed his last shift on 22 May 2016 after resigning his position shortly before this date. His hours of work over his brief period of employment as a casual were variable and reflected no pattern or plan in his short period of employment and his periods of employment or engagements were not regular or frequent. Max, the casual backpacker, had been employed for a period of approximately four weeks.

[43] Max, the casual backpacker, cannot be taken do have been either a regular or a systematic casual employee at the time of Ms Wilson’s dismissal, or engaged on that basis.

[44] “Paz”, the casual backpacker, commenced employment with the employer on 17 March 2016, some six weeks prior to the date of this Wilson’s dismissal. Max appear to have completed shifts as carried out over the six week period comprised variable hours and reflected no set pattern or plan. Paz resigned his employment on 3 May 2016. His short period of employment does not disclose that he was engaged on a regular or a systematic basis.

[45] All three casual backpackers were not casuals employed on a regular and systematic basis. None of the casual backpackers were relied upon as an incident of the business.

[46] I now turn to consider the casual school students.

The Casual School Students

[47] Ms Orne-Gliemann gave evidence that when the school student casuals were interviewed for their employment they were informed that there may or may not be shifts available to them on any given week and it was unknown whether the shifts when they were available, would be available with any frequency or for any fixed duration. Ms Orne-Gliemann’s evidence was that a wide range of factors influenced whether she offered hours to any casual employees. These include their own availability (as numerous had private commitments such as sports and cadets other than school), whether the permanent part time employees were being allocated hours (which was contingent upon performance issues), and whether there was any work available period (for reason of other external events such as weather). The evidence of both parties showed that the casual school students frequently missed or swapped shifts, dependent on their other commitments (which were clearly prioritised by these employees) and as such their employment was supplementary to the core needs of the business in most instances.

[48] The basis of the casual employment relationship between the employer and the employees at first instance do not exhibit a common understanding work would be offered and performed either regularly or systematically.

[49] None of the school student casuals were performing services on the basis of a fixed roster. On its face at least, the roster appeared to have little fixity, and was open to frequent change, and was said to be more a “statement of intention” or aspiration. (see Organ v Bushmans Bakery Pty Ltd [ 2012] FWA 8079 at [14]).

[50] “Bradley”, a school student casual, worked irregular shifts and variable hours over the 13 week period up to Ms Wilson’s dismissal. For example, he worked a Saturday and Sunday shift on two consecutive weekends, then had no shifts offered the following week. He worked two shifts the following week for variable hours (with one shift being on a different day to the prior shifts). The following week he worked no shifts.

[51] Bradley then worked two shifts on a Friday (with most of the hours falling in the afternoon) and Sunday (with most of the hours falling in the night). The following week Bradley worked no hours.

[52] The week following he worked a Thursday, Friday and a Sunday shift for varying hours. Bradley subsequent hours were also highly variable and he worked across different days on different shifts. On one week he performed four shifts and yet on another performed one shift. In between these shifts he did not perform any shifts for one week.

[53] Because his shifts were ad hoc, contingent on the performance of the part time employees and whether other casual employees were not attending work, his engagements did not exhibit the characteristics of systematic employment. Indeed, such was the relationship as revealed that it would be particularly difficult to conceive of Bradley’s engagements as demonstrating that the employer relied upon his services as an incident of its business. Seemingly, Bradley offered for work when he was available (and this was subject to school commitments and a range of other commitments). He only performed work when there was a conjunction between his availability and the hours being offered by the employer. This says two things: one is that Bradley did not dedicate his services preferentially to his employer and the other is that his employer exercised no control over his availability. These further indicia are redolent of a true common law casual.

[54] Another school student casual, “Katherine”, in the 13 week period to the dismissal of Ms Wilson, worked one Sunday for three hours and then worked no hours the following week. Katherine then worked the following three consecutive Saturdays and for five Sundays. Each of the hours on the shifts on Saturdays were variable. Only two of the Sunday shifts were for the same hours. Katherine performed no shifts in the following week and worked on a Friday and Sunday the week following that. Katherine was subsequently engaged on the Monday and Tuesday of the following week for varying hours in the week and after that performed two shifts across a Saturday and Sunday. Katherine performed no shifts the following week before working three days in the week thereafter.

[55] Katherine may have been a regular employee, if only perhaps that she was usually performing some hours on some days each week (but not always). But the basis of her engagements do not appear to be systematic, and this is because of the contingent nature of the hours on offer, as well as the employer’s acceptance that Katherine would regularly prioritise other activities (school and BMX bicycle riding commitments) over her employer’s proposed engagements, as I have set out above.

[56] “Belinda”, another school student casual, in the 13 week period prior to this Wilson’s dismissal, performed work across only four weeks (as she appears to have had commitments, in particular her high school musical program). In the first of those weeks where Belinda performed work, Belinda performed variable hours on Monday, Wednesday and Saturday. The week thereafter, Belinda performed work on Tuesday and Friday for the same spread of hours. The following week Belinda performed work on Tuesday, Thursday, Friday and Saturday, with the hours being the same other than for the shift performed on the Saturday. The week thereafter Belinda performed work on one day only, that being Friday. In between these engagements there was a one week period in which Belinda performed no shifts as none were offered (or else she sought not to offer her services at that time).

[57] Belinda’s casual engagements do not represent either regularity or evidence of a system or method.

[58] Another casual school student was “Eloise”. In the thirteen week period leading up to and including Ms Wilson’s dismissal, Eloise performed two shifts in one week, then one shift in the next week (for variable hours). In the third week no shifts were offered to Eloise. In the following three weeks, Eloise worked two shifts, then three shifts and then one shift only, The following week, Eloise was offered shifts but declined them.

[59] Following that, Eloise worked two shifts in the subsequent week, then between five shifts on one week, down to a minimum on one shift in the final week.

[60] Eloise’s engagements do not exhibit the characteristics of a system or a plan. Eloise did not exhibit a close, integral relationship with the business or render her services preferentially to her employer. Like the other school casual employees, Eloise’s engagement by the employer was based around whether Eloise’s availability coincided with the offer of work.

[61] The circumstances set out above suggest to me that some school students may have been regular casuals. This is because they appear to have performed services for the employer frequently over time, and appear to have likely to have done so in the previous three months as well on the evidence.

[62] But it is a different thing to construe the engagements as all being systematic, which the Court (see above) found to be a term which meant something more than regularity.

[63] Whilst there is a shift roster, it does not require attendance at a fixed time, the students do not appear to offer their service preferentially to their employer, the hours they are offered work are contingent on other circumstances not relating to their availability, and the hours as offered to each of the casual school students was highly variable from week to week, consequentially.

[64] The structure of the school students’ casual engagements compares very sharply with the circumstances considered by the court in Yaraka. In Yaraka (see paragraph 69) their Honours found that the pattern of engagements was said to be systematic because the employer had relied on the casual employees over some years, had not paid monies to the casual employees until the casual employees needed money or it was otherwise convenient. The casuals were also authorised to buy goods for the employer and were given Christmas bonuses. Taken together, these indicia revealed high levels of trust and integration into the business over time, thereby establishing the on-going reliance upon the worker’s service as an incident of the business. These are the types of indicia that can be taken into account when determining if the engagements of a worker are systematic in circumstances where there are no predictable hours or fixed rosters.

[65] Again, no such circumstances exist in relation to the school student casuals, whose availability was subject to school attendance, sports and other recreational obligations and undertakings. They were not otherwise integral to or relied upon the business in the sense the casual were in Yaraka.

[66] Ms Wilson contended that the casual school students worked to a pattern: when work was available it was offered to them on the basis of their known availability and they accepted that work on the terms as offered. Ms Wilson also contended the business required the performance of work by the casuals to operate. But such circumstances, by logical necessity, are characteristic of all casual employment and do not assist in establishing whether the periods of casual employment were systematic in the formal meaning, or otherwise and consistent with the court judgement in Yaraka.

[67] Ms Wilson argued that the casual school students were “rostered around wage costs”. Ms Wilson claimed more broadly that the casual school students were utilised on shifts where there was availability that was commensurate with their wage costs and balanced the skills and experience of other persons on the shift. It was argued by Ms Wilson that this was evidence of a systematic basis of engagement.

[68] The fact that when work was offered to casual employees it was offered to ensure wage costs were controlled and that the shift is productive (by ensuring that there is an alignment of skills on a particular shift, such as ensuring that at least one person could make coffee) does not assist in characterising the basis of the engagements as being regular and systematic. The employer may work to a business plan, but that is not the same as the basis of the casual employment being capable of characterisation as “systematic” or methodical, or evidencing a plan. In essence, here the application of the employer’s rational business system or method in respect of how its fills shifts does not result in the casual school students having been being employed on a systematic basis. The basis to the casual student engagements is, as set out earlier, and it discloses the flexible and ad hoc nature of their engagement. The evidence further indicated that it was not the particular employees that were required by the business, but rather the availability of any employee in a particular pay bracket, and the number of school student casuals employed by the employer was a result of their frequent unavailability as opposed to their regular and systematic engagement.

[69] Ms Wilson contended further that staff were informed that they would be employed on the basis they would be offered shifts in accordance with their performance, and they would “control the amount of hours they would receive”. This seemed to sit at odds with her claims above and did not reflect the evidence of the employer, who claimed that this was an arrangement that affected permanent part time staff only. Ms Wilson for her part exhibited some considerable uncertainty as to which employees were part time employees and which were casual employees, despite claiming to provide a detailed analysis of the roster system and engagements offered by the employer.

[70] The maximum number of employees employed by the employer for purposes of section 23 of the Act could be twelve employees.

[71] This means it is not practically possible for the employer to have employed 15 or more employees. It follows that the employer must be a small business for purposes of section 23 of the Act.

[72] Is not necessary for me therefore to evaluate the circumstances of the remaining employees for purposes of the determination of the jurisdictional objection. The jurisdictional objection is made out and the application made by Ms Wilson under section 394 of the Act cannot proceed as a consequence.

[73] I do add that a number of other issues arose in relation to the employer comprising two directors who drew a so-called “wage” from the business and might arguably be employees of the business as a result.

The Company Directors

[74] Firstly, it is true that the two directors drew a “wage” (a term used for convenience only) from the business. But more is needed for purposes of identifying the directors as employees of the business.

[75] It would not be unusual for people who are Managing Directors of a company to be both Directors and employees of the same company:

“As managing director he is a party to a contract with the company and this contract is a contract of employment; more specifically I am of the opinion that it is a contract of service and not a contract for services. There is nothing anomalous in this; indeed it is a commonplace of law that the same individual may have two or more capacities, each including special rights and duties in relation to the same thing or matter or in relation to the same persons.” Anderson v James Sutherland (Peterhead) Ltd. [1941] SC 203

[76] In the current circumstances, there is no formal contract or agreed legal terms between Mr Orne-Gliemann and Mrs Orne-Gliemann as so-called Managing Directors and B.A.R.B. Trading Pty Ltd, let alone contractual terms that require or compel the performance of any services on any terms and conditions. A contract of employment is a particular species of contract requiring personal service:

“[25] Contracts of employment (contracts of service traditionally so-called) are contracts for personal service. […] The requirement for personal service has the effect that a contract which truly permits discharge in another fashion or by another person, is not a contract of employment. Thus, contracts with corporations, contracts with partnerships, contracts permitting unlimited delegation and contracts which do not actually compel the performance of work but pay only on results, are each prima facie not contracts of the necessary quality […] ” ACE Insurance Limited v Trifunovski [2013] FCAFC 3 per Buchanan J.

[77] While both Managing Directors (as they identified themselves) withdrew monies from the business (as “wages”) neither Mr Orne-Gliemann or Mrs Orne-Gliemann as Directors did so on the basis of any consideration in exchange for personal services. Nor are Mr Orne-Gliemann or Mrs Orne-Gliemann the recipients of the usual incidental benefits of employment – Long Service Leave, Superannuation and other leave related entitlements and benefits, conventional considerations in exchange for service.

[78] Notwithstanding their nominal title as Managing Directors, until Ms Wilson’s dismissal, Mr Orne-Gliemann and Mrs Orne-Gliemann did not engage in day to day operational matters in respect of the business (with Ms Wilson’s employment as a manager being the means by which they ceased to manage the business). Where Ms Orne-Gliemann appeared on the roster, it was for purposes of providing training to the casual employees, and not to perform day to day duties or otherwise rendering personal services to the business in exchange for a particular consideration. The provision of training by Ms Orne-Gliemann is more akin to efforts to advance the affairs of the business by a proprietor.

[79] Neither Mr Orne-Gliemann nor Mrs Orne-Gliemann have entered a contract for personal service with B.A.R.B. Trading Pty Ltd, the relevant corporate entity.

[80] Though it is of no relevance to my ultimate finding as set out above, I do not consider the Directors in the circumstances before me to be employees of the business, such that they should be included in the head count of employees for the purposes of the jurisdictional question.

Conclusion

[81] At the time of Ms Wilson’s dismissal, the employer employed fewer than fifteen employees. As a consequence, Ms Wilson must have served the requisite 12 months minimum period of employment before such time as she could make an application of unfair dismissal. Ms Wilson has not served such a minimum period of employment. As a consequence, her application under s.394 of the Act must be dismissed.

SENIOR DEPUTY PRESIDENT

Appearances:

Ms Wilson for herself.

Mr Gaeta of Connolly Suthers Lawyers for the respondent.

Hearing details:

Monday, 27 June 20016

Federal Magistrates Court

Townsville, Qld

Printed by authority of the Commonwealth Government Printer

<Price code C, PR581537>