Natasha Bakerzis

[2020] FWC 6679

[2020] FWC 6679

The attached document replaces the document previously issued with the above code on 11 December 2020.

Corrected paragraph numbering.

Associate to Commissioner McKinnon

Dated 11 December 2020

[2020] FWC 6679

FAIR WORK COMMISSION

DECISION

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

Jannine Russell
v
Natasha Bakerzis
(U2020/10782)

COMMISSIONER MCKINNON MELBOURNE, 11 DECEMBER 2020

Application for an unfair dismissal remedy – whether employee – whether protected from unfair dismissal – whether consistent with Small Business Fair Dismissal Code.

[1] Natasha Bakerzis is a young woman with disabilities who qualifies for support under the National Disability Insurance Scheme (NDIS). She lives with her grandmother who is severely disabled. Her aunt, Marina Quinlan, has power of attorney and is legally responsible to represent her interests.

[2] Jannine Russell met the family of Ms Bakerzis in 2017 when she was employed by agency Mecwacare to perform in home aged care services for Ms Bakerzis’ grandmother. Approximately 12 months after commencing in this role, Ms Quinlan asked Ms Russell if she was interested in separately providing personal care services to Ms Bakerzis under the NDIS. Ms Russell said she was and began providing care for Ms Bakerzis in either October or December 2018.

[3] According to Ms Russell, the arrangement worked to the satisfaction of all parties until 21 July 2020 when she received a telephone call from Ms Quinlan accusing her of complaining to Mecwacare about her duties. Ms Russell denied making a complaint and Ms Quinlan insisted that she had. The following day, Ms Russell received an email from Ms Quinlan advising her that her services were no longer required.

[4] Ms Russell applied for an unfair dismissal remedy on 8 August 2020, within the statutory 21 day timeframe. The question is whether Ms Russell was an employee of Ms Bakerzis (through Ms Quinlan) and if so, whether she was protected from unfair dismissal. There is then the separate question of whether the dismissal was consistent with the Small Business Fair Dismissal Code, because if Ms Russell was an employee of Ms Bakerzis, she was the only one.

[5] For the reasons that follow, I find that Ms Russell was an employee of Ms Bakerzis who was protected from unfair dismissal because she was a casual employee engaged on a regular and systematic basis with a reasonable expectation of continuing employment. Her dismissal was consistent with the Small Business Fair Dismissal Code.

Was Ms Russell an employee?

[6] Whether a person is an employee of a business or an independent contractor is commonly resolved by reference to a multifactorial test endorsed in Kimber v Western Auger Drilling Pty Ltd 1(Kimber). At the heart of the inquiry is whether, at the relevant time, the person was the servant of another in its business or was instead carrying on a business on their own behalf.

Control over the manner in which work is performed, place of work, hours of work and the like.

[7] There was no written contract between the parties. Ms Russell generally had autonomy over her daily activities which were caring for and supporting Ms Bakerzis within broad parameters set by Ms Quinlan. She worked to a care plan that she prepared and had sought approval from Ms Quinlan to use. Ms Russell would often decide what tasks to do and report to Ms Quinlan at the end of the day or shift. The place of work was in the home of Ms Bakerzis together with whatever outings were necessary to provide her with appropriate care.

[8] Hours of work were mostly set by Ms Quinlan. Ms Russell could ask for changes in hours if she wanted to work or was unable to attend. Text messages between the two reveal a friendly, back and forth dialogue, with Ms Quinlan asking Ms Russell about when she wanted to work or was available and then confirming those arrangements. Ms Quinlan made requests for Ms Russell to perform discrete tasks on occasion and Ms Russell provided updates at certain points during the day about progress of meals, daily activities and the like.

[9] On balance, the evidence points to a working relationship controlled by Ms Quinlan on Ms Bakerzis’ behalf and carried out by Ms Russell under her general direction. This factor resolves in favour of employment.

Work for others

[10] The right to exclusive services from a person can be characteristic of employment, while working for others or the entitlement to do so can indicate an independent contracting relationship. 2 Ms Russell not only had the right to work for others, she did so as an employee of both Mecwacare and another entity, Enrich. This matter resolves in favour of an independent contracting relationship.

Whether the worker has a separate place of work and/or advertises her services to the world at large or whether the worker held out as an emanation of the business

[11] Ms Russell had no separate place of work and did not advertise the services she provided to anyone else. She did not have an Australian Business Number, a reason given by Ms Quinlan for not having “gone down” the route of an independent contracting arrangement. This matter points toward an employment relationship between the parties.

Tools or equipment

[12] All the tools and equipment used for the performance of work were provided by Ms Quinlan on behalf of Ms Bakerzis or sourced from the home of Ms Bakerzis. This factor resolves in favour of employment.

Delegation or subcontracting

[13] There was no capacity for Ms Russell to delegate or subcontract the work she performed to any other party. Thisfactor resolves in favour of an employment relationship.

Rights to suspend or dismiss

[14] If the employer had the right to have a particular person do the work under its contract with the employee, or the right to suspend or dismiss her, this could suggest that the contract was one of service rather than a contract for services. 3 The analysis furthers a consideration of whether the person is working in the business of another, rather than in the business of their own.4

[15] The relationship between Ms Bakerzis and Ms Russell was personal to them. Ms Quinlan had the right to terminate the services of Ms Russell on behalf of Ms Bakerzis at any time. This factor resolves in favour of an employment relationship.

Remuneration, income tax and superannuation

[16] It has been said that employees tend to be paid a periodic wage or salary, whereas independent contractors are often paid by reference to the completion of certain tasks, although, “in the modern economy this distinction has reduced relevance”. 5 Further, the circumstance of invoice for services rendered and payment on that account might tend in favour of a finding that the relationship was one of contract for services while the absence of any such arrangement might weigh in favour of a contract for services.

[17] Ms Russell was paid on an hourly basis according to hours worked each week. Income tax was deducted from remuneration paid and there is no evidence about whether superannuation was also paid on her behalf by Ms Quinlan. On balance, this factor points to a relationship of employment.

Holidays or sick leave

[18] Ms Russell was able to advise her unavailability for work and to take leave of absence but was not entitled to paid annual or sick leave. This factor suggests that Ms Russell was either a contractor or a casual employee.

Distinct profession, trade or calling

[19] Persons engaged in a distinct profession, trade or calling may tend to be independent contractors rather than employees. 6 In this case, I have treated it as a neutral consideration because the role of personal care worker is capable of being performed under both contracting and employment arrangements.

Goodwill

[20] Generally speaking, a contractor will have an interest in establishing value in their business, while an employee will contribute to the goodwill of another’s business. The absence of any goodwill or saleable asset accruing during the period of work is a factor that weighs in favour of employment.

[21] There is no evidence that Ms Russell had an interest in establishing the value of her own business or that she was building or had the ability to develop commercial goodwill while providing personal care services to Ms Bakerzis. This resolves in favour of an employment relationship.

Business expenses

[22] This consideration relates to whether a significant portion of remuneration was spent on business expenses. There is no evidence of any relevant expenditure on equipment or tools, or any capital investment, that were brought to the relationship by Ms Russell without being reimbursed. This factor resolves in favour of employment.

Was Ms Russell a servant in the business or was she carrying on a business on her own behalf?

[23] On balance, the factors above weigh in favour of an employment relationship between the parties.

Was Ms Russell protected from unfair dismissal?

[24] An employee is protected from unfair dismissal if they have completed the minimum period of employment and either a modern award covers them, an enterprise agreement applies to their employment or their annual rate of earnings is less than the high income threshold. Ms Russell’s annual income of approximately $16,000 was less than the high income threshold.

[25] Ms Russell was employed by Ms Bakerzis for more than twelve months. Her employment was casual in nature, because her hours were variable and she had the right to decide whether to accept or refuse shifts of work depending on her availability, just as her hours of work could be, and often were, varied.

[26] A period of service as a casual employee only counts towards the minimum employment period if the employment was on a regular and systematic basis and the employee had a reasonable expectation of continuing employment on a regular and systematic basis.

[27] The employment of Ms Russell was on a regular and systematic basis. She ordinarily worked Tuesday afternoons and after the onset of the pandemic in Victoria in late March 2020, she took on extra shifts. Ms Russell was regularly working Tuesday, Thursday, and Friday afternoons as well as every second Saturday at the time of her dismissal.

[28] I also find that Ms Russell had a reasonable expectation of continuing employment on a regular and systematic basis because at the time of her appointment, she had been working for the family for approximately 12 months. She was a known and trusted person in their lives. While a new carer had recently been introduced into the home, it was on the basis that the two would work on alternate days. I accept that Ms Bakerzis had the right to choose her carer under the NDIS and to change carers from time to time, but I am not persuaded that the consequence of this right is generally that service providers under the NDIS can never have a reasonable expectation of continuing employment. It will always depend on the circumstances of the case. Here, there was an established relationship between the parties that had been ongoing for some time and other than discussion about adjustments required in response to the COVID-19 pandemic, no indication that things were unlikely to continue as they were for the foreseeable future.

[29] Ms Russell is protected from unfair dismissal.

Was the dismissal consistent with the Small Business Fair Dismissal Code?

[30] Ms Russell was the only employee of Ms Bakerzis at the time of her dismissal. For the purposes of the Act, Ms Bakerzis was a ‘small business employer’.

[31] The Small Business Fair Dismissal Code applies to small business employers. Under the Code, an employee of a small business employer will not be unfairly dismissed if their dismissal is consistent with the Code.

[32] In this case, the Code applies as it relates to summary dismissal because Ms Russell was dismissed without notice or warning on 22 July 2020. Under the Code, 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.

[33] Serious misconduct in this sense encompasses both the ordinary meaning of the term and the definition of ‘serious misconduct’ in regulation 1.07 of the Fair Work Regulations 2009. It is conduct which strikes at the heart of the employment relationship, such that the employee has repudiated the contract of employment or one of its essential conditions. It includes wilful or deliberate behaviour by an employee that is inconsistent with the continuation of the contract of employment and conduct that causes serious and imminent risk to the reputation, viability or profitability of the employer’s business. It also includes significant refusal to carry out a lawful and reasonable instruction that is consistent with the employee’s contract of employment.

[34] At the time of dismissal, Ms Quinlan believed that Ms Russell had made an anonymous complaint to Mecwacare about having to do the laundry for Ms Bakerzis and that her denial about making the complaint was dishonest. Her concern in this regard arose after a series of events beginning in mid- to late May 2020.

[35] Following discussions between the parties about Ms Russell’s availability for work at the end of Victoria’s first lockdown due to the pandemic, Ms Quinlan took steps to secure another carer for Ms Bakerzis. On 30 May 2020, Supreme Health Services placed Dusica Dereta to care for Ms Bakerzis, initially working ‘shadow’ shifts at the same time as Ms Russell. Ms Dereta found working with Ms Russell challenging and on 1 July 2020, asked Supreme Health Services to formally raise her concerns with Ms Quinlan. The same day, Ms Quinlan was contacted by Mr Chris Taylor, a Manager from Supreme Health Services.

[36] Mr Taylor asked Ms Quinlan if she was aware of what was happening in the house, with particular reference to an incident involving the purchase of strawberries where Ms Dereta felt bullied and harassed by Ms Russell. Ms Quinlan said that she would address it with Ms Russell, but it is not apparent that she did in any direct way.

[37] In early July 2020, Victoria entered into a second lockdown. Both Ms Quinlan and Ms Russell were concerned about the risks of exposure to COVID-19.

[38] On 20 July 2020, Ms Russell asked Ms Quinlan if she wanted her to be the sole carer for Ms Bakerzis for 6 weeks, coinciding with the anticipated lockdown period. One consequence of this proposal would have been the suspension of services provided by Ms Dereta. Ms Quinlan said she would leave things as they were, declining Ms Russell’s offer. Ms Russell also asked for a raised toilet seat to be provided for Ms Bakerzis’ grandmother, which Ms Quinlan also refused on the basis that it would not be beneficial.

[39] On 21 July 2020, Ms Quinlan received a call and later an email from Mecwacare reporting a complaint from “a lady who did not want to give her name” about the provision of services for Ms Bakerzis’ grandmother. The nature of the concern was that the care worker was “doing the washing, changing the bed linen and folding the washing” for Ms Bakerzis and things that were not on her Care Plan, making it difficult for other care workers working with the client who would be required to perform these extra tasks as well.

[40] Ms Quinlan assumed the complaint had been made by Ms Russell because other carers employed by Mecwacare were only present in the house in the mornings for one hour. They were not aware of the need to support Ms Bakerzis with the washing and bed linen or how this support was provided. Only Ms Russell and Ms Dereta (who was not employed by Mecwacare) were involved in tasks of this nature.

[41] At 1.20pm on 21 July 2020, Ms Quinlan called Ms Russell in a state of distress. She advised that she had received a phone call from Mecwacare about an anonymous complaint from a carer about expectations to perform work that was not on the Care Plan for Ms Bakerzis’ grandmother. She accused Ms Russell of making the complaint and Ms Russell denied it, saying “I did not ring up and complain”. Ms Quinlan hung up.

[42] Ms Quinlan rang again at 5.43pm that evening, accusing Ms Russell of complaining to Mecwacare and bullying staff. Ms Russell denied the allegations repeatedly. Ms Quinlan asked her to stop yelling and abusing her and told Ms Russell they would discuss it later. Ms Russell said she would only communicate by email from now on. Ms Quinlan hung up again.

[43] On 22 July 2020, Ms Russell missed a call from Ms Quinlan at 11.03am. A message on her mobile from Ms Quinlan said words to the effect “don’t threaten me and don’t take matters into your own hands or get revenge.” The comments reflected a concern held by Ms Quinlan in the context of Ms Russell having previously told her she would “get revenge on previous employers if they did her wrong”. At 1.20pm that afternoon, Ms Quinlan terminated the employment of Ms Russell by email.

[44] The question is whether, at the time of dismissal, Ms Quinlan believed on reasonable grounds that Ms Russell’s conduct - in making a complaint to Mecwacare, in denying having made the complaint, and in her treatment of Ms Dereta - was sufficiently serious to justify immediate dismissal.

[45] In relation to the concern about the treatment of Ms Dereta, the evidence does not rise to the threshold of establishing that Ms Quinlan believed, on reasonable grounds, that Ms Russell’s conduct in this regard was sufficiently serious to warrant summary dismissal. Much of the evidence is hearsay but more significantly, and despite being aware of the matter from at least 1 July 2020, Ms Quinlan did not raise it with Ms Russell until their final conversation on 21 July 2020. Even then, the matter appears to have been addressed only in passing in the context of a heated exchange which was focused on the Mecwacare complaint. Ms Quinlan did not give Ms Russell an adequate opportunity to respond to the concerns and was not in a position to have formed a reasonable belief that the alleged conduct was so serious that it justified immediate dismissal.

[46] However, I find that Ms Quinlan had reasonable grounds for believing that Ms Russell was the one who made the complaint to Mecwacare, because of Ms Russell’s unique role in providing services both to Ms Bakerzis and her grandmother and her involvement in the washing and changing of bed linen for each. She was the only one who did the washing with Ms Bakerzis and folded it. Except Ms Dereta, no-one else knew that Ms Bakerzis needed to be directed on folding the laundry. Ms Dereta was not employed by Mecwacare and had no reason to contact them about the nature of work performed for Ms Bakerzis’ grandmother. Ms Russell had previously asked Mecwacare about whether it was her job to change the bed for Ms Bakerzis because it was too much in the hours allocated to care for Ms Bakerzis’ grandmother.

[47] Because I accept that Ms Quinlan had reasonable grounds for believing that Ms Russell made the complaint to Mecwacare, I also find that Ms Quinlan had reasonable grounds for believing that Ms Russell was not being honest when she denied having made the complaint. It is important to note that this is not a finding that Ms Russell actually made the complaint. The making of the complaint itself would not give rise to grounds for summary dismissal, being a course both open to Ms Russell if she held the relevant concerns and arguably a workplace right in connection with her employment with both Mecwacare and Ms Bakerzis.

[48] Dishonesty is a matter that is capable of striking at the heart of the employment relationship. This is particularly so where the relationship involves the provision of personal services in the home setting and caring for vulnerable persons where the need for trust and confidence is paramount. In this case, Ms Quinlan’s concern was heightened by Ms Russell’s prior admissions about extracting “revenge” from previous employers who had wronged her.

Conclusion and disposition

[49] Ms Quinlan believed that Ms Russell had been dishonest with her about the making of the Mecwacare complaint and that this conduct was sufficiently serious to justify immediate dismissal. Her belief was based on reasonable grounds. The dismissal was consistent with the Small Business Fair Dismissal Code.

[50] The jurisdictional objection is dismissed.

[51] The application is dismissed.

COMMISSIONER

Appearances:

J Russell and M Russell for the Applicant.
M Quinlan and B Quinlan for the Respondent.

Hearing details:

2020.
Melbourne (by videolink):
October 26.

Printed by authority of the Commonwealth Government Printer

<PR725354>

 1   [2015] FWCFB 3704. See also French Accent v Do Rozario [2011] FWAFB 8307; Abdalla v Viewdaze Pty Ltd t/a Malta Travel (2003) 122 IR 215; Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16; Hollis v Vabu (2001) 207 CLR 21.

 2   Jiang Shen Cai trading as French Accent v Michael Anthony Do Rozario[2011] FWAFB 8307; (2011) 215 IR 235, [30].

 3   Stevens v Brodribb Sawmilling (1986) 160 CLR 16, p.36, per Wilson, Dawson JJ.

 4   Ace Insurance v Trifunovski (2013) 235 IR 115, at [93].

 5  [2011] FWAFB 8307 at [30].

 6   [2011] FWAFB 8307 at [30].