Ms Priscilla Billing v Aspire College of Education

[2016] FWC 2569

[2016] FWC 2569

The attached document replaces the document previously issued with the above code on 3 May 2016.

The date was changed to indicate the correct date the decision was published.

Brendan Pearce

Associate to Senior Deputy Richards

Dated 5 May 2016

[2016] FWC 2569

FAIR WORK COMMISSION

DECISION

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

Ms Priscilla Billing
v
Aspire College of Education
(U2016/82)

SENIOR DEPUTY PRESIDENT RICHARDS BRISBANE, 21 APRIL 2016

Application for relief from unfair dismissal

[1] This decision concerns an application by Ms Priscilla Billing under section 394 of the Fair Work Act2009 (“the Act”), by which means Ms Billing seeks an unfair dismissal remedy in relation to the termination of her employment on Wednesday, 17 December 2015 by her employer, Aspire College of Education Pty Ltd (“the College”).

[2] On the basis of Ms Billing’s own materials, she was advised at a meeting of staff held on 16 December 2015 that as a consequence of the Commonwealth Government having frozen all funding to VET Fee Help Providers (a notorious fact), the College was unable to deliver training to existing students and would require a company-wide restructure.

[3] The College subsequently communicated in the same terms to Ms Billing, and seemingly to other affected staff, by way of formal correspondence provided to her that same day.

[4] Ms Billing was informed that her position was no longer required and that because of the circumstances she was unable to be retained in any other role. Ms Billing was offered through correspondence provided to her, assistance from the HR team retained by the College in respect of alternative employment, resume writing, and hardship funding.

[5] Ms Billing was paid her notice period (in lieu) and accrued leave entitlements. There is further discussion of these circumstances below.

[6] Ms Billing filed an application to the Commission claiming an unfair dismissal and seeking remedy. Upon progressing the application, the Commission was informed that the College had been placed in Administration and that Hall Chadwick Pty Ltd had been appointed Voluntary Administrators of the College on 9 February 2016, along with a large number of what appear to be related companies and associated entities.

[7] Hall Chadwick pressed that the application should not proceed on the basis of the operative effect of s.440D of the Corporations Act 2001. On the basis of that claim I corresponded with the Administrators on 4 April 2016 in the following terms:

“Dear Mr Charlwood,

U2016/82 Priscilla Billing v Aspire College of Education

Senior Deputy President Richards asks whether the circumstances of the jurisdictional objection (below) relate to s.440D of the Corporations Act 2001 (“the Act”) or s.500(2) of the Act.

CORPORATIONS ACT 2001
SECT 440D
Stay of proceedings
(1) During the administration of a company, a proceeding in a court against the company or in relation to any of its property cannot be begun or proceeded with, except:
(a) with the administrator's written consent; or
(b) with the leave of the Court and in accordance with such terms (if any) as the Court imposes.
(2) Subsection (1) does not apply to:
(a) a criminal proceeding; or
(b) a prescribed proceeding.
SECT 500
Execution and civil proceedings
(1) […]
(2) After the passing of the resolution for voluntary winding up, no action or other civil proceeding is to be proceeded with or commenced against the company except by leave of the Court and subject to such terms as the Court imposes.
[7] Please respond by C.O.B. Tuesday 5 April 2016.”

[8] The Administrator replied and claimed that s.440D of the Corporations Act 2001 is applicable and did not press s.500(2) of the Corporations Act 2001. In light of this correspondence I directed the following further email correspondence to the Administrator later on 4 April 2016:

Dear Mr Charlwood

RE: U2016/82 Priscilla Billing v Aspire College of Education

I refer to your email below. His Honour replies as follows:

“My preliminary observation in relation to s.440D of the Corporations Act 2001 (“the Act”) is that it may not apply to the Fair Work Commission, as it is not a Court (as referred to in the section) but rather an administrative tribunal and a proceeding in a court is not a proceeding in the Commission.”

Section 58AA of the Corporations Act provides the following definition in relation to the meaning of "court" and "Court":

58AA Meaning of court and Court

(1) Subject to subsection (2), in this Act:

"court" means any court.

"Court" means any of the following courts:

(a) the Federal Court;

(b) the Supreme Court of a State or Territory;

(c) the Family Court of Australia;

(d) a court to which section 41 of the Family Law Act 1975 applies because of a Proclamation made under subsection 41(2) of that Act.

(2) Except where there is a clear expression of a contrary intention (for example, by use of the expression "the Court"), proceedings in relation to a matter under this Act may, subject to Part 9.7, be brought in any court.

“There is authority for the proposition that the Fair Work Commission not being a Court as defined. Section 500(2) does not have such a prescription, however, hence the basis of my enquiry.

I note, incidentally, that an exercise of arbitration powers by the Commission constitutes a civil proceeding for purposes of s.500(2) of the Act. In Re Vassal Pty Ltd 8 ACLR 683, Justice King of the Supreme Court of Queensland dealt under State law with the issues whether the commencement of an arbitration against Vassal Pty Ltd (Receivers and Managers Appointed) was a civil proceeding within the meaning of the relevant legislation and found (following another, earlier judgment) found:

"Arbitration is a regular procedure recognised by statute for the resolution of legal claims, differences or disputes between parties. Rules of law are prescribed by statute for the conduct of arbitrations. Statutory powers are conferred on arbitrators. The jurisdiction of the courts is invoked in aid of the arbitration procedure. Attendance of witnesses may be compelled, witnesses may be sworn and wilfully false evidence before an arbitrator constitutes the crime of perjury. The procedure results in an award which is enforceable at law. Arbitration is clearly recognised by the statute as a method of resolving legal disputes alternative to litigation in the courts. I think that in the ordinary use of language such a procedure would be included in the description in the description 'civil proceedings'.

It follows that s.440D of the Corporations Act provides appears not to provide a defence against the claim made by Ms Billing. Incidentally, why the Corporations Act serves to shield creditors’ interests in one part and not another is not a matter about which I can shed any light.

If you disagree and would like to be heard on the matter, even if by filing submissions, please do not hesitate to confirm your interest in doing so. If you do not challenge the above, then Ms Billing’s application will proceed to arbitration unless she indicates she no longer presses her application. I would be grateful for your response by COC 8 April 2016, if not before.

[9] The Administrator did not respond to the above communication and has subsequently indicated that it does not wish to be heard in relation to the application by Ms Billing. In light of the above reasoning, I consider there to be no jurisdictional impediment to my consideration of Ms Billing’s application under s.394 of the Act. In light of this communication I now turn to consider Ms Billing’s application on its face.

Consideration of the application

[10] Whilst Ms Billing was informed that her employment would come to an end on 16 December 2015, she was permitted to continue in her employment for a further day, as she completed a work program for a particular student. Ms Billing does not on her materials, contest that the College’s reasons for terminating her employment were genuine and soundly based.

[11] Ms Billing conceded in her material that she asked no questions at the meeting of 16 December 2015 about any matters other than indicating to her employer that she would be seeking legal advice. Subsequently, in a private context, Ms Billing claimed to a College representative that she considered this she should have been given at least a few weeks’ notice and that it had been harsh to be informed of her dismissal in the meeting referred to above.

[12] Ms Billing also claimed that she had a mental impairment and had been receiving counselling since the death of her one of her sisters in September 2015. She therefore considered the College’s actions as a breach of its duty of care.

[13] Ms Billing also claimed that she had worked additional hours for which she had not been remunerated. Ms Billing also raised various incidents of a largely low-level nature that had arisen of the course of her employment in question why the College had not followed the matters up or else issued apologies.

[14] Whilst having no direct knowledge of her former employer’s corporate structure, Ms Billing also suggested that she should have been redeployed to another training college, which may have had a corporate relationship with her employer.

[15] In her final submissions, Ms Billing stated as follows:

“As stated in my Unfair Dismissal Application “I believed I should have been given at least four (4) weeks notice prior to the 18th December 2015”, “for unfair and unreasonable and for no prior consultation on the future of the College and the failure of duty of care to me while impaired with the intent to dismiss me from my job” (sic).

[16] Ms Billing otherwise indicated that she had been paid two weeks’ notice – one week based on her period of prior service and another week for reason of her being over the age of 45 years. Notice was paid in lieu of service. Ms Billing, I add, had been employed for a period of some 9 months prior to the termination of her employment.

[17] That said, in essence, Ms Billing believes her dismissal to been unfair for reasons that include that she had not been compensated for hours worked; had not been given a reasonable and fair notice of redundancy; the dismissal represented a breach of the employer’s duty of care; there was no prior consultation on the future of the College; and that she had anticipated being paid over Christmas during which the campus would have been closed and should now be paid those monies.

Legislative context

[18] Section 387 of the Act sets out the criteria for considering whether a dismissal was harsh, unjust or unreasonable. Section 387 is as follows:

387 Criteria for considering harshness etc.

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:

(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and

(b) whether the person was notified of that; and

(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and

(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal; and

(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(h) any other matters that the FWC considers relevant.”

Consideration

Whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees)

[19] As set out above, Ms Billing’s employment was terminated for reasons that her position was no longer required by the College and the College did not require that position to be performed by anyone. Mr Billing does not deny that that the College ceased to trade as it was, let alone for the reason she was given at the meeting of 16 December 2016 and then later that day in writing, or that the College subsequently was placed into Administration. I add that Ms Billing subsequently accepted a casual engagement with the College in Administration.

[20] The Full Bench in UES (Intl) Pty Ltd v Leevan Harvey [2012] FWAFB 5241 (Harvey) indicated that a dismissal for operational reasons was not a dismissal related to an employee’s capacity or conduct.

[21] Ms Billing’s dismissal was because of an operational reason. She does not so deny, and the surrounding circumstances support this conclusion. The reason for Ms Billing’s dismissal is not a matter relevant to s.387(a) of the Act. Ms Billing’s employment was not terminated for any reason related to her capacity or performance or conduct, thus there was no valid reason within the meaning of the subsection for her employer’s decision. As a consequence, the circumstances bear in neutral terms upon the ultimate finding as to whether or not Ms Billing was dismissed harshly, unjustly or unreasonably.

Whether the person was notified of that reason

[22] Ms Billing was not notified of a valid reason for her dismissal for reasons that her dismissal was for an operational reason unrelated to her conduct or performance. This is a consideration that bears in neutral terms upon my ultimate finding.

Whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person

[23] Ms Billing, as I have indicated above, was not dismissed for reasons of her capacity or conduct. As I found above, she was dismissed for operational reasons arising from the financial difficulties experienced by his employer. As a consequence, this matter is of neutral implication for my finding as to whether or not Ms Billing was harshly, unjustly or unreasonably dismissed.

Any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal

[24] No relevant circumstances arose of the kind contemplated by the subsection in the circumstances of the termination of Ms Billing’s employment. Therefore this is a matter that does not bear in my considerations in any positive manner.

If the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal

[25] As mentioned above, Ms Billing was not dismissed for reasons of unsatisfactory performance (let alone for conduct or capacity). This matter therefore bears on my ultimate decision in neutral terms.

The degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

The degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal

[26] The material before me does not suggest that the employer’s business was a small business for purposes of section 23 of the Act, and the College on the face of its documentation, indicates that it had access to human resource management expertise which it made available to Ms Billing.

[27] The size of the College’s undertaking and the availability of its human resource expertise are not therefore matters which can be taken to have affected the procedures which led to Ms Billing’s dismissal.

Any other matters that the FWC considers relevant

[28] Issues of underpayment are not matters, as pressed by Ms Billing, which can be rectified under the jurisdiction Ms Billing has invoked. They are not matters that are relevant to the dismissal, as Ms Billing has other avenues for pursuing a claim in these regards. I do add by way of observation – given what is before me - that Ms Billing’s claims for underpayment will need to be made out carefully, and in detail, if she wishes to press them in a competent jurisdiction.

[29] Ms Billing also claimed that her circumstances warrant the payment of a further period of notice including for a period over Christmas which she would ordinarily have been paid when the College shutdown for two weeks. As it is, Ms Billing was paid her statutory notice in lieu at the time of her dismissal. Her claim for an additional payment, including for a future period of time is not a relevant consideration. There is no argument to be had that the College terminated Ms Billing’s employment to avoid payment of any entitlements.

[30] Perhaps there might be a modicum of harshness in respect of the communication of the closure of the College and the redundancy situation in relation to Ms Billing, given her state of mind which arose from entirely unrelated circumstances. But that concern does not warrant a conclusion the dismissal was harsh as such, when the wider considerations are accorded weight.

[31] The reason for Ms Billing’s dismissal was the operational circumstances which had affected the viability of the College’s business, which arose from a well-publicised Federal Government decision to restructure the VET Help Fee system. There is no contest in this respect.

[32] The College effected the redundancies quickly and with little advance notice or any rich level of consultation. It did so for reasons that are the subject of public knowledge – the income stream through the VET Help Fee system was interrupted suddenly by decision of the Federal Government (for reasons that are in the public domain).

[33] The Full Bench in Harvey found that:

“A failure to consult does not necessarily mean a dismissal was harsh, unjust or unreasonable.”

[34] The absence of consultation beyond that described above does not render the dismissal harsh, unjust or unreasonable.

Conclusion

[35] When all the circumstances in this matter are considered, the termination of Ms Billing’s employment, no matter how regrettable such a development might be, and unsettling its impact, was sound, and defensible and was effected without malice or mischief.

[36] Ms Billing’s application for an unfair dismissal remedy under s.394 of the Act is dismissed.

SENIOR DEPUTY PRESIDENT

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