Palmer v DDR Plumbing and Gas Fitting Pty Ltd
[2015] FCCA 2086
•6 August 2015
FEDERAL CIRCUIT COURT OF AUSTRALIA
| PALMER v DDR PLUMBING & GAS FITTING PTY LTD | [2015] FCCA 2086 |
| Catchwords: INDUSTRIAL LAW – Non-payment of overtime – close correlation between amounts paid under contract and amounts due under relevant award – whether unlawful deduction of annual leave entitlements in order to reimburse employer – whether employee dismissed for exercising a workplace right – no breach of the Fair Work Act 2009 – application dismissed. |
| Legislation: Building Act 1993 (Vic), ss.221D, 221G, 221ZZZA |
| ACE Insurance Ltd v Trifunovski (No. 2) (2012) 215 IR 206 Australian & New Zealand Banking Group Limited v Finance Sector Union of Australia (2001) 111 IR 227 Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500 Byrne v Australian Airlines Ltd (1995) 185 CLR 410 Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd (2014) 88 ALJR 980 Cubillo v Commonwealth (No. 2) (2000) 103 FCR 1 Young v Smith [2015] NSWSC 400 Linkhill Pty Ltd v Director, Office of the Fair Work Building Industry Inspectorate [2015] FCAFC 99 Murrihy v Betezy.com.auPty Ltd (2013) 238 IR 307 O’Shea v Heinemann Electric Pty Ltd (2008) 172 FCR 475 Poletti v Ecob (No. 2) (1989) 91 ALR 381 Ray v Radano [1967] AR (NSW) 471 State of Victoria (Office of Public Prosecution) v Grant [2014] FCAFC 184 |
| Applicant: | MATTHEW PALMER |
| Respondent: | DDR PLUMBING & GAS FITTING PTY LTD |
| File Number: | MLG 709 of 2013 |
| Judgment of: | Judge Smith |
| Hearing dates: | 20 & 21 April 2015 |
| Date of Last Submission: | 27 April 2015 |
| Delivered at: | Sydney & Melbourne |
| Delivered on: | 6 August 2015 |
REPRESENTATION
| Solicitor for the Applicant: | Mr M. Addison, Maddison & Associates |
| Counsel for the Respondent: | Mr B. Shaw |
| Solicitors for the Respondent: | Gray & Gray Barristers & Solicitors |
ORDERS
The application be dismissed.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLG 709 of 2013
| MATTHEW PALMER |
Applicant
And
| DDR PLUMBING & GAS FITTING PTY LTD |
Respondent
REASONS FOR JUDGMENT
Introduction
The applicant was employed by the respondent in early 2006 as an apprentice plumber. It was envisaged at that time that the applicant’s training as an apprentice would be completed 48 months later, that is, by early 2010. While he progressed well in his on-the-job training, he fell behind in the schooling component of the apprenticeship. By the end of 2012 he still had not completed the necessary schooling in order to sit his journeyman exams and to obtain the qualifications necessary to become a licensed plumber.
The previously harmonious relationship between the applicant and the respondent deteriorated during the course of a number of events that took place in late 2012. Although there is some dispute as to when this deterioration started, the first matter that could be said to have led to it was that, in late September 2012, some tools belonging to the respondent were stolen from a work car the applicant had left parked in the street while visiting his girlfriend. The respondent demanded payment for these from the applicant and subsequently, when that payment had not been made, cancelled the applicant’s accrued entitlements for holiday pay. The second event was that, in early October 2012, the applicant injured his lower back at work and applied to WorkCover for compensation in respect of that injury. The third matter was that, by letter dated 6 December 2012 written by his solicitor, the applicant made a number of claims including that he had been underpaid approximately $60,000 in respect of overtime and other hours worked.
These events brought about a number of meetings and correspondence between the parties. On 15 February 2013 the respondent dismissed the applicant with one month’s notice.
The applicant’s claims in these proceedings were articulated in a number of different ways. Ultimately, in oral submissions at the hearing, the applicant relied on three issues: first, that the respondent breached the Fair Work Act 2009 (“Act”) by failing to pay him in respect of overtime and other hours worked (“Awards claim”); secondly, that the respondent unlawfully deducted annual leave entitlements from the applicant (“Entitlements claim”); and thirdly, the applicant was dismissed because he was exercising workplace rights (“General Protections claim”).
No attention was given by the applicant in his submissions to the different statutory regimes that applied in the course of his employment from 2006 to 2013 or to the transition between them. As will be seen, that makes no difference to the outcome in these proceedings and it is unnecessary for the Court to explain or seek to apply those different regimes to the facts of this case. The issues in this case, as I apprehend them, fall to be decided by reference to the Act and a modern award rather than by reference to the predecessors to them.
Before turning to a more detailed examination of the relevant facts in this case, it is necessary to refer to the relevant statutory and award provisions.
Relevant statutory provisions
Part 2-1 of the Act makes provision in relation to the terms and conditions of employment. Section 45 provides that a person must not contravene a term of a Modern Award. A Modern Award is one that is made under the provisions of Part 2-3 of the Act: s.12. The relevant Modern Award in these provisions is the Plumbing and Fire Sprinklers Award 2010 (“PFS Award”) which was first made on 3 April 2009. The version in evidence contained variations to that Award made up to 19 June 2012; however, neither party submitted that any variation made a relevant difference to the issues to be determined and I proceed on the basis that the terms of the Award at all relevant times were those contained in the document admitted into evidence.
On 1 January 2010 the Award superseded an earlier Award, the Plumbing Trades (Southern States) Construction Award 1999 (“PTSS Award”). The PTSS Award was declared to be a common rule for the State of Victoria with effect from the first pay period on or after 1 January 2005 (see Workplace Relations Act 1996 (“WR Act”), ss.141, 493A). It was common ground that the PTSS Award applied to the applicant from the time he commenced employment with the respondent in January 2006. However, the PTSS Award is not a Modern Award and (apart from any possible application of the Fair Work (Transitional Provisions) Act 2009) it has force under the WR Act rather than the Act.
Section 45 is a civil remedy provision within the meaning of s.539 of the Act. This means that the Court has power to make any order it considers appropriate if the Court is satisfied that a person has contravened, or proposes to contravene the provision: s.545. The Court may also order a person to pay a pecuniary penalty it considers appropriate if it is satisfied that the person has contravened the provision: s.546. The Court can order that the penalty be paid to the Commonwealth, a particular organisation or a particular person: s.546(3). Unsurprisingly, the applicant in this case submitted that, if a pecuniary penalty order were made, the Court should order that the penalty be paid to him.
Part 2-9 of the Act deals with other terms and conditions of employment. Division 2 of that Part concerns the payment of wages. Section 323, which falls within that division, provides that an employer must pay an employee amounts payable to the employee in relation to the performance of work in full (except as provided by s.324), in money, and at least monthly. Note 2 to the section states that amounts referred to in the subsection include, amongst other things, leave payments if they become payable during a relevant period.
One issue in the proceedings is whether, at the relevant time, the annual leave entitlements were payable to the applicant. In order to resolve that issue, it will be necessary to return to this provision in more detail as well as to the terms of the PFS Award and the National Employment Standards contained in Part 2-2 of the Act.
Section 323 is also a civil penalty provision.
Section 324(1)(a)(ii) allows an employer to deduct an amount from an amount payable to an employee in accordance with s.323(1) in certain circumstances. It was not in dispute that none of those circumstances applied in this matter.
Part 3-1 of the Act provides for general protections in the workplace for employees.
Section 340 provides that a “person must not take adverse action against another person because the other person has or has not exercised a workplace right”. A workplace right is, as one might expect in an Act of this name, broadly defined so that a person has one if he or she entitled to a benefit under a workplace law or is an employee and is able to make a complaint in relation to his or her employment: sub-ss.341(1)(a) and (c). A workplace law includes the Act and any other law of the Commonwealth, a State or Territory that regulates the relationships between employers and employees: s.12.
Credit of the witnesses
In this case, evidence was given for the applicant by the applicant and his brother, Justin Palmer. Mr Di Rosa, the principal of the respondent, gave evidence for the respondent. In addition, Mr Eberhard, an officer of the Master Plumbers and Mechanical Services Association of Australia (“Master Plumbers Association”), gave evidence about the amounts that had been paid to the applicant by the respondent and compared that to the amounts that he would have been paid under the relevant awards.
The credit of both the applicant and Mr Di Rosa was put in issue. As Sackar J of the New South Wales Supreme Court recently stated, with reference to Cubillo v Commonwealth (No. 2) (2000) 103 FCR 1 at [118]-[123], a trial judge is not restricted in his or her assessment of a witness, and is not bound to accept any of that which the witness attests to and indeed may only accept part thereof: Young v Smith [2015] NSWSC 400 at [61]. In Cubillo, O’Loughlin J said, at [118]:
… After making an assessment of the evidence, after utilising the advantage of having seen and heard all the witnesses, and after forming an impression of each, the confidence that the judge reposes in a particular witness is assessed accordingly. Where evidence has a logical probative value, a judge will rely on it; where it contains discrepancies, displays inadequacies, is tainted or otherwise lacks probative force, the judge will, in all probability reject it or, at least, not rely on it….
All of those comments apply equally to both the applicant and Mr Di Rosa. My impression from seeing them give their evidence was that, for the most part, they gave honest and forthright evidence to the best of their recollection. However, in some respects this was not so. Mr Palmer, for example, became evasive when asked in cross-examination about whether he had organised to undertake further schooling in early 2013. At one point he said simply that he was “busy with other things”. When asked what those things were, he said they were rehabilitation and organising scans. As will be seen, I reject that evidence and conclude that he had no intention of completing his studies at the relevant time.
Mr Di Rosa was not evasive and overall his demeanour was consistent and unshaken. Mr Addison, the solicitor appearing for the applicant, tested his evidence closely and vigorously contested his veracity. In spite of that, Mr Di Rosa responded calmly and confidently without appearing to be simply advocating his own cause. However, his evidence was, to some extent, inconsistent with his affidavit evidence. His affidavit evidence was to the effect that he could not recall the incidents at the Park Hotel in early December 2012 referred to by Justin Palmer because he was drunk. Under cross-examination he was able to deny Justin Palmer’s version of events because, he said, he kept to himself that night and talked to another group of people. I discuss the significance of this evidence later. For the moment it suffices to say that this inconsistency cast some doubt on my overall impression of Mr Di Rosa as a witness.
The relevant facts
The applicant started work for the respondent on 31 January 2006 pursuant to a three-month probationary contract of employment dated 24 January 2006. The relevant terms of that contract were as follows:
…
Wages
Your gross hourly rate on commencement will be $8.00 per hour working a 40 hour week with a scheduled RDO once a month.
Wages are deposited into a nominated bank account every Thursday.
…
Termination
Employment may be terminated by either party by giving one (1) week notice.
Unacceptable conduct will result in immediate termination.
Hours of work
Work commences at 6:30am unless otherwise specified.
Ordinary Hours are 40 hours per week over a 5 day period (Monday to Friday), with an RDO once a month (scheduled).
Most days the hours worked range from 8-11 hours per day.
You are paid for meal breaks and travelling time to jobs.
Overtime
Any time worked after 7pm after working your ordinary hours during Monday – Friday will be paid a rate of double time ($16.00 per hour).
If working Saturdays, a rate of $12.00 per hour will apply for the first hour and a rate of $16.00 for every hour thereafter, where you will be paid for a minimum 3 hours.
If working Sundays, a rate of $16.00 per hour will apply you will be paid a minimum of 4 hours.
…
Trade School
You are required to attend formal classes at a TAFT Institute – usually one week out of every month where you will be paid to attend school. This is classified as ‘off the job training’.
…
On 9 February 2006 the parties signed a training contract whereby the respondent agreed to employ and train the applicant in accordance with a training plan and the applicant agreed to undertake any training and assessment set out in the training plan. The training contract was set to expire after 48 months from 31 January 2006, namely on 30 January 2010. That training contract was registered with the Victorian Department of Education & Training. The qualification intended to be obtained was a Certificate III in Plumbing undertaken at the Victoria University (TAFE Division). Only part of the training plan was in evidence. It appears to have been signed by the parties on 25 May 2006.
The applicant gave evidence that three to four blocks into his schooling some of the students’ records went missing while changing over a recording system/program and were never recovered. The applicant said that he was one of the students who had been affected by this and it was not easy to prove to his teachers that he had completed the work. He explained that, while others who were affected managed to catch up by cheating, he did not cheat and so remained behind.
On 3 May 2006 the applicant successfully completed his probationary period and entered into a new contract of employment with the respondent on essentially the same terms as the first agreement but at the higher rate of $9.00 per hour on weekdays and higher rates on weekends.
The applicant’s evidence was that he was absent from trade school for four days in his first year and that he was asked to work a few of those four days but did not remember exactly how many. Mr Di Rosa gave evidence that the applicant was absent from trade school for two days because of a football trip taken by him and for one day due to work.
The applicant said that in his second year of the apprenticeship his progress at trade school did not improve very much and he did not make any ground on the work he had to repeat from his first year.
The applicant gave evidence that in his third year of trade school he missed 11 days because he was made to work: one week in March, one week in May and a day in August. He said that he fell further behind and was not offered any assistance by the respondent in completing the academic component of his apprenticeship. In his affidavit he said:
Between doing 12 hour days and having more and more work put in front of me with shorter timeframes there was literally not enough time to make up lost time in 2008.
I find that evidence is exaggerated and I reject it. The applicant’s pay records for that period show that he rarely, if ever, worked 12 hour days. Those pay records were compiled by the respondent from sheets completed by the applicant. The evidence was that the respondent did not check the hours claimed in the sheets but simply trusted its employees to fill them in accurately. As will be seen, this type of exaggeration was not uncommon in the applicant’s evidence.
I do accept however, that the applicant fell behind early in his studies and remained that way. I also accept that the applicant had notified the respondent of this at least by 2008 although it is far from clear that the applicant ever told the respondent the extent to which he was behind in his school work.
Mr Di Rosa gave evidence that the applicant missed two days of school in his second year on account of work and in his third year missed nine days due to work commitments. The evidence taken from the respondent’s business records (to which there was no objection) reveals that on a number of occasions throughout 2007 and 2008 the applicant was either late to trade school or only attended part of a day without notifying the respondent.
In March 2009 the applicant’s brother, Justin Palmer, started working as an apprentice with the respondent. As part of that apprenticeship, he attended trade school, although it was a different school to that attended by the applicant. There was no suggestion in Justin Palmer’s evidence that he had any difficulties either attending trade school or with any of the marks that he had received while doing so. Certainly, it was not his evidence that the work was such as to make it difficult for him to complete the obligations of his apprenticeship.
In 2009 the applicant agreed with Mr Di Rosa that he would attend night school in order to catch up on his school work. His affidavit evidence was that he began attending night school but that at times he was too exhausted after working for 11 to 12 hours. He then claimed that he attended “training” but did not enrol at night school because it was expensive and that it would have been too much for him at the time. I reject that evidence. An email from Mr Bendle, the Education Manager of the Plumbing Department at the University of Victoria, stated that the teacher who ran the night classes at the relevant time could not recall the applicant ever attending. The applicant has never produced anything to corroborate his evidence that he attended night school or training during this period.
The applicant also gave evidence that towards the end of his training contract there had been too much work in order for him to attend trade school. He said that the work was at a level where he was no longer having “smoko” breaks or lunch breaks every day and that he would only occasionally eat. He said that there was too much work to ever stop and he said that he felt that if he did he would not get home until 7.30pm every night. I find this evidence to be exaggerated and deliberately false. The pay records of the respondent revealed that in the last four months of 2010 the applicant worked an average of 43.7 hours per week. That made an average of 8.7 hours per day, on the basis that the applicant started work at 6.30am. This would mean that he would finish work by 3.30pm, on an average day. For that reason, I do not accept either that the applicant was unable to attend trade school because of the amount of work that he was asked to perform, or that he was denied any break through the day.
The uncontested fact was that by February 2010, when the training contract had expired, the applicant had not undertaken sufficient schooling in order to qualify for a Certificate III in Plumbing. I am not satisfied that that was caused in any way by the respondent even though, on the respondents own evidence, there were a number of days on which the applicant was required to work instead of attending trade school. As noted earlier, the applicant’s brother, who was also engaged by the respondent as an apprentice managed to complete his trade school requirements within a three-year period.
Throughout the course of his employment, the applicant had been given a number of pay rises. On 22 July 2010 the applicant was given a further pay increase so that he was being paid $23 per hour. This pay increase was effected by a further contract of employment described as “Apprentice Plumbing and Mechanical Services – Fourth Year”. That contract, signed by the applicant on 15 September 2010, was, to a large extent, in the same terms as previous contracts signed by the parties. Certain adjustments were made to it, it seems, in light of the new statutory regime. For example, it included the following:
Under the National Employment Standards (NES), a maximum standard working week is 38 hours for full-time employees, plus ‘reasonable’ additional hours.
This contract also included the following:
Award & Terminations
The terms & conditions of your employment are governed by the provisions of the Plumbing and Fire Sprinklers Award 2010 (the PFS Award), and the National Employment Standards (NES).
(Emphasis in original)
On 27 September 2012 the applicant drove to his girlfriend’s house in the work van owned by the respondent. At 8:50pm the van was broken into and approximately $5000 worth of tools were stolen. The applicant’s evidence was that the lock on the van had been faulty making it easy for a thief to break in. He did not explain why, in those circumstances, he left the van unattended and without permission after dark on a public street.
The applicant called Mr Di Rosa who told him that he would need to replace the tools out of his own pocket. The following day the pair discussed the issue again and the applicant was told that, while Mr Di Rosa was away on leave, the applicant should get prices for the replacement of the items from a supplier of the respondent who would do a good deal for him. The conversation then turned to the applicant’s schooling. After indicating that he was not satisfied with the applicant’s unwillingness to complete his schooling, Mr Di Rosa offered to help him by contacting the trade school to get an update on all that was completed so that they could work together on how the applicant could finish his schooling. The applicant became upset and indicated that he was not certain that he wanted to complete his schooling. The conversation ended on the basis that the issue would be discussed again once Mr Di Rosa returned from leave.
On 2 October 2012, the applicant injured his back at work. He kept working that day but took the following day off work and saw a chiropractor. In a report dated 11 October 2012, the chiropractor explained what he had been told by the applicant as to the cause of the injury. He wrote:
[The applicant] was not aware of any direct injury which precipitated the pain in his lower back, however found that over the course of the day at work he had progressive weakness in his lower back and right thigh and found that he was forced to hunch over further and further in an attempt to reduce the pain.
The applicant ceased work on 15 October 2012 on account of the pain from this injury. On 18 October 2012 Christina Di Rosa, also an employee of the respondent, sent a text to the applicant asking whether the applicant was returning to work the following week or whether it was a WorkCover issue. She said that if it was the latter, he would need to obtain a certificate of capacity signed by a GP. The applicant obtained a certificate of capacity on the same day which indicated that he was unfit for any duties from 15 October 2012 until 28 October 2012. The certificate stated as the description of the injury: “Alleged bend over at work and developed back pain.” The diagnosis was “lower back pain radiating down right leg. Awaiting CT scan.”
The following day, Mrs Di Rosa sent a text message to the applicant asking again whether he would be claiming the injury through WorkCover and explaining that if that were the case he would need to also fill in a form which she could send to him. Later that day, Mrs Di Rosa sent another text message to the applicant saying:
By the way, we need the money for the tools that were stolen through ur negligence & need it right away. Daniel needs these tools urgently & is purchasing them himself. I will send you proof of purchase of the amount we paid by emailing you so as u know how much to pay him. Cannot wait any longer. We can take your entitlements as part payment but u will need to make up the difference now. I will send you the amount for ur entitlements if that is what u want to do.
The applicant did not respond to this text.
On Monday, 22 October 2012 the applicant drove to the respondent’s premises and dropped off the completed WorkCover claim form, medical receipts and a CT scan report. Mr Di Rosa asked him when he would be paying for the stolen tools and handed the applicant copies of receipts for the tools and details of the applicant’s leave entitlements. Mr Di Rosa indicated that the respondent could take the applicant’s entitlements as part payment if that is what the applicant wanted to do. The applicant did not respond.
The applicant’s pay advice for the week ending 24 October 2012 revealed that the applicant’s holiday leave accrual was zero, indicating that the applicant’s holiday leave entitlements had been deducted in order to compensate the respondent for the stolen tools.
On 29 October 2012 the applicant called Fair Work Australia and was advised that he should download the PFS Award. He also sent a text message to Mr Di Rosa saying that he had been given “another four weeks off work” and “I’m going to need to grab a reprints of all my payslips. And any contracts you’ve given me to sign also to please”. He stated in his affidavit that the respondent effectively refused to do so. However, the evidence of the text messages that followed reveal that this evidence, too, was exaggerated and that, while the respondent was interested to know why after seven years of keeping no records the applicant suddenly wanted all his records, there was no resistance to giving him what he asked for.
On 20 November 2012 the respondent’s WorkCover insurer, Allianz, accepted the applicant’s claim for weekly payments and he received WorkCover payments from that date until June 2013.
On 4 December 2012 the applicant sought advice from a solicitor in connection with his employment. The applicant also gave evidence that on 6 December 2012 he met with his solicitor and that his solicitor “telephoned Christina early afternoon on that day expressing concerns in relation to the workplace issues”. By letter of the same date, Mrs Di Rosa wrote to the applicant asking him to attend an interview on 11 December 2012 to discuss various matters including the completion of the applicant’s schooling. Mrs Di Rosa wrote:
Following your alleged workplace injury on 3/10/12, the Company has been trying to identify suitable duties that can accommodate your incapacity. The Company determined that one likely opportunity would be for you to concentrate on the completion of your studies. In order to fit to facilitate this process, the Company contacted Victoria University – Sunshine to obtain details of your progress and how the Company could assist.
During discussions with Mr Graham Bendle, I was informed that Victoria University has no record of your attendance since 2009. In addition, according to academic records provided by Victoria University, to date you have satisfied approximately 50% of your study requirements.
…
We are also concerned that your failure to obtain trade qualifications so, that you may undertake the duties of a Plumber, may affect your capacity to continue your employment with the Company.
A hand written note on the front of the letter indicates that the email was received at 2:25p.m. By email sent at 4:35pm, the applicant’s solicitor wrote to Mrs Di Rosa noting his instructions that the applicant had not completed all of the schooling associated with his apprenticeship “due to some reluctance on the part of the Company to allow him to complete that schooling”. In addition, the email raised a number of other matters. Relevantly, the applicant’s solicitor wrote:
… Whilst the Company seems to be paying the correct rates on Saturday the overtime rate during the week is clearly wrong and is a breach of the award. My client has done a calculation and is of the view that a significant sum is owed to him that sum is approximately $57,410.00. I also understand that the Company does not pay the employee the first 30 minutes of each day.…
In relation to the company deducting money from Matthew’s wages relating to a theft from the Company vehicle. I raised with you that this is an unlawful deduction it is unlawful both under the Fair Work Act 2009 at Ss 323, 324, 325, and 326. Also the deductions contravene the Victorian Workers’ Wages Protection Act 2007…
Finally, since I contacted you this afternoon I understand that you have forwarded correspondence to Matthew in relation to a disciplinary meeting that you wish him to attend on Tuesday 11 December. It seems to me that this is a retaliatory action on your part due to my contact. Actions against employees who raise concerns about the terms and conditions of employment are unlawful under the FWA. As such we view the letter sent to our client about 30 minutes after my conversation with you to be a breach of the Act in such request that you withdraw it.…
A number of assertions in that email, both as to fact and law, are inaccurate. Its author, Mr Addison, who also appeared for the applicant at the hearing of this matter, relied upon it as evidence that one of the reasons for which the applicant’s employment was terminated was that he had exercised a workplace right, namely complaining about breaches of the relevant award. That contention will be examined more closely later in these reasons. For present purposes, I note that for a legal practitioner who is so closely involved in a matter to also appear as an advocate on a final hearing is fraught with danger. Certainly, it appeared difficult for Mr Addison to distinguish the matters of which he was aware from his own experience and involvement rather than from his objective review of the evidence before the Court.
In any event, the email also requested a postponement of the meeting which was acceded to by the respondent. That meeting instead took place on 14 December 2012. In the meantime, the applicant’s annual holiday leave entitlements were re-credited to the applicant.
Justin Palmer gave evidence that he was confronted by Mr Di Rosa on the day following Mr Addison’s correspondence. He said that Mr Di Rosa kept asking him “why [his] brother was suing him and why is he seeking legal action” and kept saying things like “your fucking brother’s name will be dirt in Werribee by the time I’m finished with him” and “if you play with fire eventually you get burnt”. When Justin Palmer said that he did not understand what Mr Di Rosa was talking about Mr Di Rosa responded “your brother’s a fucking dog, I suggest you talk to him about it when you get home”. Justin Palmer says that later that evening he saw Mr Di Rosa at the Park Hotel in Werribee and that Mr Di Rosa approached him and cornered him, saying “why is your brother suing me”, “what’s this fucking 60 grand about?” He gave evidence that Mr Di Rosa became aggressive and started pushing him in the chest. Others told Mr Di Rosa to calm down and when he did he pointed at Justin Palmer and said “Matty is finished at the company and if [you] agreed with this lawsuit and Matty’s fucking bullshit views [you] will also be finished at the company too.”
In his affidavit Mr Di Rosa said that he had no recollection of the events alleged by Justin Palmer and that he was not sure how he got home but that his wife was so angry with him for being so drunk that she put him to bed. Under cross-examination, rather than saying that he could not remember the events in Mr Palmer’s affidavit, Mr Di Rosa denied them saying that he had kept to himself on the evening in question. I do not accept that evidence. If Mr Di Rosa had any recollection of the evening in question he would have been able to say so and would have done so in his affidavit. I consider that he has changed his evidence because he thinks that it is in his interest to do so. On the other hand, Justin Palmer was not tested at all about this evidence and I accept that he was truthful in what he said.
The applicant’s evidence about the meeting of 14 December 2012 was that he attended the meeting with a Pauline Fegan and was asked by Mr Di Rosa to provide evidence to back up his statements of attendance records and completion of work while at trade school. He said that the meeting was poorly organised and that he was given no real chance to ask questions of his own and that after 14 or so of Mr Di Rosa’s questions he was cut off and the meeting ended. However, in a letter dated 27 December 2012 addressed to the applicant, the respondent gave a detailed summary of the meeting. Given that the applicant never contested the summary set out in that letter I accept it as being an accurate summary of what occurred at that meeting. In light of it, I reject the applicant’s evidence in this respect.
The letter dated 27 December 2012 indicated that the meeting had taken approximately 45 minutes. It said that the concerns raised at the meeting were that the applicant’s conduct had been inconsistent with his contract of employment because of his failure to follow a lawful and reasonable direction by failing to attend trade school and obtain trade qualifications as well as by providing misleading information about his trade school attendance and progress. Amongst other things, the letter included the following:
I then advised that between January 2010 and September 2012, I regularly asked about your attendance and progress at night school and offered assistance including leave to complete studies. You denied this and stated “you did not assist me”.
I confirmed that you had never reported any problems or requested any assistance. You agreed that you had never requested help.
I also confirmed that on 28 September 2012, I asked you about your studies. You confirmed that this was correct.
I also confirmed that on this occasion, you became upset (crying) and said that you were not sure if you could complete the studies and were not sure if you wanted to. When asked if this correct, you stated that “You may have taken this out of context.” I asked “yes or no”. Ms Fegan intervened stating that I could not ask you how to answer.
I advised that the Company had made enquiries with the Victorian Plumbing Industry Commission (Commission) regarding your capacity to undertake plumbing work in accordance with the state-based plumbing regulations. The Commission had advised that in order to undertake plumbing work in Victoria, a person must be registered with the commission or engaged under an apprenticeship contract. Since your apprenticeship contract has ended in 2010, in order to continue working in the plumbing industry, you would need to obtain registration with the Commission.
You agree that you understood this and stated that “Yes, I understand it is a registered trade.”
I asked if you were prepared to apply for provisional registration (with assistance of the Company). Ms Fegan then stated that you required more information about the industry prior to being able to answer the question.
I explained that the Commission offers a special class of registration called “provisional registration”, that allows an individual to work under the direction of a registered/license tradesperson until they can apply for registration. In order to obtain provisional registration, you would need to attend an interview with the Commission and provide evidence of your experience and academic records demonstrating that you will be able to complete. If the Commission agrees, the provisional registration may be granted. This is usually for a maximum period of 12 months.
Following further clarification (as requested by Ms Fegan), you confirm that you understood the requirements provisional registration.
I asked if you are prepared to apply for provisional registration (with assistance from the Company) and you stated “Yes” but Ms Fegan stated that you could not answer the question until you have further understanding what was involved. Ms Fegan then answered “Yes. On the condition that Matthew is not disadvantaged and is provided information”.
I explained that if you could not obtain provisional registration, you would be unable to perform plumbing work? When asked if you understood this, you stated “I already perform plumbing work. I repeated the question. You did not answer the question.
I explained that if you are unable to perform plumbing work, you would be unable to perform the job that you have been employed for and your employment may be terminated. The legal term for this is “frustration of the employment contract”. When asked if you understood this, Ms Fegan requested that we move on from the question. You did not answer this question.
…
In order to progress this matter, the Company will require the following action on your part:
7.You will be required to provide written evidence from Victoria University supporting your asserted attendance at trade school (night school) between 2010 and present. This evidence must be provided no later than 14 January 2013
8.You will be required to provide written evidence from Victoria University supporting your asserted academic progress. This evidence must be provided no later than 14 January 2013.
9.You will be required to provide written evidence from the plumbing industry regulator (Plumbing Industry Commission, Victoria) that you have applied for provisional registration and are scheduled to attend an interview with the regulator. This evidence must be provided no later than 14 January 2013.
10.Upon receipt of the evidence requested, the Company will give further consideration to your circumstances and the options available.
11.In the event that you are unable to provide the required evidence by 14 January 2013 you will be required to contact us giving substantive reasons why you are unable to do so.
…
I also advise that the Company initially became aware of the specific requirements of the Victorian plumbing regulations on 20 November 2012, when we contacted the Master Plumbers and Mechanical Services Association of Australia for advice on suitable duties that can be offered as part of a return to work plan. At this time, Master Plumbers’ indicated concerns regarding your status under the plumbing regulations, and referred the Company to the Plumbing Industry Commission for clarification and advice. Until this time, the Company had considered your employment to be covered by the apprenticeship arrangement (as you had not completed your formal training requirements.
I confirm that the Company continues to have serious concerns about this matter and, pending review of further information, may consider termination of your employment.
Enclosed with the letter was a Plumbing Industry Commission application form said to be for provisional registration as a plumber. That form was signed by Mr Di Rosa and the applicant’s details had been filled out by hand.
The applicant did not respond to this letter and did not supply the evidence requested by it. On 22 January 2013 the respondent wrote to the applicant again requesting the evidence referred to in the 27 December letter. Once again, the applicant neither replied to the email nor supplied the requested material. More significantly, the applicant made no effort to seek provisional registration from the Commission or to find a way in which he could complete his schooling and so obtain trade qualifications. As already noted, the applicant’s evidence under cross-examination was that he did not do so because he was “busy with other things”. When asked what those things were he said “rehabilitation and treatment”. When asked if there was anything else, he said “there were some other things going on with Allianz Insurance as well, organising scans and such”.
The evidence shows that in this period the applicant had an MRI scan on 21 December 2012 and another on 27 December 2012. On 21 January 2013 he saw his GP about the results of the MRI scan and was given a return to work plan which was due to last for three weeks starting on 28 January 2013. In the absence of any other evidence I find that the applicant’s evidence that he was too busy to undertake any enquiries about his schooling was false. I find that the real reason he did not make any such enquiries and made no effort to obtain provisional registration is that he had no intention of doing either. Indeed, it appears that the applicant had planned his ultimate termination and that his failure to respond to the respondent’s requests was a part of that plan. Certainly, in February 2013, when he posted on his Facebook page that he was “today sacked whilst on WorkCover… interesting times ahead” one of his friends wrote: “good to see what we spoke about before Christmas has come about…” Another friend wrote “Milking it or?” The applicant replied to the latter comment: “Nah. Suckling it”.
Whilst it is not necessary for me to make conclusive findings about these matters, they are relevant to the applicant’s overall credibility and I have taken them into account in assessing whether I accept the respondent’s evidence as to the reasons for which the applicant’s employment was terminated. The applicant’s credit is relevant to this question because it contradicted Mr Di Rosa’s evidence in a number of respects. Were I to form the view that everything the applicant said in evidence was true, I would be less likely to accept Mr Di Rosa’s evidence about the reasons for terminating the applicant’s employment. I also take them into account in determining whether, on the whole of the evidence, the applicant has made out any of his claims that the respondent breached any awards in a number of respects.
On 5 February 2013 the respondent again wrote to the applicant in connection with the evidence requested by it at the meeting on 14 December 2012. The respondent requested a further meeting on 12 February 2013. The applicant had, by this stage, resumed work on his return to work plan. On 12 February 2013, the applicant’s solicitor wrote to the respondent indicating that the applicant would not be attending the meeting later that day and gave reasons for his non-attendance. By letter dated 15 February 2013 the respondent wrote to the applicant terminating his employment “for reason of frustration of the employment contract due to your inability to perform the inherent requirements of your position”.
Consideration
Contentions
Before turning to the arguments that were ultimately made by the applicant in oral submissions, it is necessary to have regard to the various ways in which his claims were framed.
In his application, filed in May 2013, the applicant claimed two matters. The first was a breach of s.340 of the Act. This was framed in the following way:
Breach of section 340, Workplace right involved insistence on application of Award provisions to employment which employer refused to apply in breach of the award. Workers Compensation and refusal to allow employer to unilaterally recover money from employee/Applicants wages because of a loss of tools.
The remedies sought by the applicant were compensation, pecuniary penalty and “Other”.
The second claim was that the respondent had breached the terms of the PFS Award in relation to overtime, the hours of work provision, 10 hour break provision, meal break provisions and refusal to allow the applicant, whilst an apprentice, to leave to attend trade school. In respect of these matters, the applicant sought back payment for monies not paid and penalties under s.539 of the Act.
In written submissions filed before the hearing the applicant again made two claims. The first was for breaches of two awards: the first being the PTSS Award; the second was breach of the PFS Award. In respect of the PTSS Award, the applicant claimed breaches in respect of payment of wages, overtime and weekend work. In respect of the PFS Award, he claimed breaches in respect of overtime, hours of work, 10 hour break, meal break, refusal to allow the applicant to attend trade school and make up pay provisions.
The second claim in the written submissions was for breach of the general protections provisions of the Act. The basis of this claim was the assertion that the applicant was terminated because he raised concerns about the award entitlements that he was due, because he had made a claim for WorkCover and because he sought advice about the respondent’s demand that he pay for the stolen tools.
At the hearing, the applicant relied on three issues: the general protections claim, the entitlements claim and the unlawful deductions claim. In respect of the entitlements claim, he relied only on the terms of the PFS Award. That approach was consonant with the claims in the application (not only because there is no mention of the PTSS Award there, but also because reliance was only placed on the Act) and I will deal with the matter on the basis that no claim is made based on the terms of the PTSS Award.
It is convenient to deal with the award issue first.
Breach of the PFS Award
The first breach of the PFS Award claimed was the failure by the respondent to allow the applicant time to attend trade school. Clause 15.10 of the PFS Award relevantly provided:
15.10 Attendance at a Registered Training Organisation
(a)The apprentice will be released by the employer to attend a Registered Training Organisation during ordinary hours of work for the purpose of undertaking the off-the-job component of apprenticeship training without loss of pay.
It is important to recall that this claim relies only on the PFS Award. The effect of that is that it is unnecessary to decide whether there was any non-compliance with the PTSS Award. Thus, the fact that Mr Di Rosa admitted that, prior to 2010, the applicant had been required to work instead of going to trade school on a number of occasions is irrelevant to the applicant’s claims. The applicant’s evidence about the period from 2010 was that he was too busy at work to attend. I have rejected that evidence (see [32] above) and find that there is no basis to conclude that the respondent breached cl.15.10 of the PFS Award.
The second breach alleged is the failure to pay the applicant for work between 6.30am and 7.00am each working day. The difficulty with it is that, while both the applicant and his brother made this assertion, there was nothing to corroborate it. Indeed, the claim is inconsistent with the fact that they were both paid in accordance with the hours recorded by them on their time sheets. There is no objective evidence to support the claim and I reject it.
The third claim is that the applicant was not paid meal allowances, rest breaks and RDO overtime. Once again, these claims are based on a single generalised assertion in the applicant’s affidavit. Given my view that the applicant’s evidence is characterised by exaggeration, I do not accept his assertion and find that this breach has not been established.
The fourth claim is that the respondent failed to pay the applicant make up pay when he was injured. The basic premise of this argument is that WorkCover payments amount to 95% of an employee’s wage and the employer is required to “make up” the remaining 5% of wages. Mr Addison argued that this arose from cl.23 of the PFS Award. That clause relevantly provided:
23 Accident Pay
23.1Subject to clause 23.2, an employee is entitled to accident pay in accordance with the terms of an award made under the Workplace Relations Act 1966 (Cth) that would have applied to the employee immediately prior to 27 March 2006, a notional agreement preserving a State award that would have applied to the employee immediately prior to 1 January 2010 or a Division 2B State award that would have applied to the employee immediately prior to 1 January 2011:
(a)if the employee had at that time been in their current circumstances of employment and no agreement-based transitional instrument, enterprise agreement or Division 2B State employment agreement had applied to the employee; and
(b)that would have entitled the employee to accident pay in excess of the employee’s accident pay, if any, under any other instrument.
23.2The employee’s entitlement to accident pay under the award, the notional agreement preserving a State award or the Division 2B State award is limited to the amount of accident pay which exceeds the employee’s entitlement to accident pay, if any, under any other instrument.
…
Mr Addison did not take me to the terms of any award or other instrument that might fall within the meaning of cl.23 of the PFS Award. It is possible that, in this respect, he relied on the terms of the PTSS Award; however, even if that award did fall within cl.23, there were no terms of that award in evidence before me that supported any claim to accident pay in excess of that to which the applicant received under the Accident Compensation Act 1985 (Vic). For that reason, I reject this claim.
The final claim in respect of the PFS Award is that the applicant was not properly paid for overtime. This claim involved an issue of principle between the parties. Before turning to that, it is necessary to set out the relevant award provisions and then to recount the relevant facts.
Clause 20.2(b) of the PFS Award relevantly provided:
(b)The minimum rates of weekly wage to be paid to apprentices will be the following percentages of the aggregate of:
(i)the minimum wage rate for the plumbing and mechanical services tradesperson/Sprinkler fitter tradesperson Level 1 classification (clause 20.1); and
(ii)for plumbing apprentices:
· the plumbing trade allowance (cl 21.1(c)); and
· the tool allowance (cl 21.2(a)) …;
…
Apprentice Plumbing apprentices
% per week
For the first year 37.5
For the second year 55
For the third year 70
For the fourth year 90
Clause 20.1 set out the minimum weekly wage for an adult employee. The wage for general Level 1 employees ranged from $637.50 and $16.78 per hour to $706.10 and $18.58 per hour depending on the time spent in the industry.
Clause 33 of the PFS Award dealt with overtime. It relevantly provided:
33 Overtime
33.1 General overtime provisions
(a)In respect of all time worked beyond the ordinary hours of work as prescribed in clause 29 – Ordinary hours of work over a four week work cycle, employees must be paid:
…
(ii)plumbing and mechanical services employees in Victoria – 150% for the first hour and 200% thereafter;
…
The main difference between the terms of the applicant’s employment contract and the PFS Award in relation to payment was that, while the applicant was paid well in excess of the minimum wage, he was not paid any additional amount for overtime before 7pm except on weekends. It will be recalled that Mr Eberhard gave evidence about the amounts that had been paid to the applicant by the respondent and compared that to the amounts that he would have been paid under the relevant awards. The spreadsheet prepared by Mr Eberhard for this purpose reveals that in the period from January 2010 the applicant was paid more than he would have received had he been paid under the Award with the exception of one week. However, his evidence has to be unbundled to some extent in order to understand the differences between the parties.
Mr Eberhard’s table was divided into two parts: the first being what the applicant was actually paid broken down into ordinary hours, additional hours and overtime (that is, weekend work) and columns with the hours worked multiplied by the rate of pay. The second part had essentially the same configuration, but the hours were multiplied by the rates in the awards. The critical factor was that in the second part Mr Eberhard used the minimum wage set out in the award. Thus, the periods of overtime, although (relevantly) multiplied by 1.5 and 2.0 in accordance with cl.33 of the PFS Award, the lower rate of pay was used. A truncated example from the table illustrates this and can be found in Annexure 1 to this judgment.
The applicant argued that this was wrong in principle and that the calculation of the amount payable under the award should use the contractual rate of pay. The respondent conceded that, if this were correct, there would have been considerable underpayment in respect of overtime. However, he argued that the correct approach was taken by Mr Eberhard, namely, to assess whether the applicant had been underpaid on a gross basis by reference to the minimum award wage. The respondent relied on the decision of the Full Court of the Federal Court in Poletti v Ecob (No. 2) (1989) 91 ALR 381 (“Poletti”). The applicant argued that that decision had been overtaken by Byrne v Australian Airlines Ltd (1995) 185 CLR 410 (“Byrne”). The respondent’s argument is correct.
The facts in Poletti were that, while a stable foreman was paid less than the award amount in wages, he received, in total, more than his award entitlements because he and his family lived rent free in a flat above the stable. A magistrate found that this was in breach of the relevant award and imposed penalties. The Full Court upheld that decision by applying the minority view of Sheldon J in Ray v Radano [1967] AR (NSW) 471 (“Radano”) at 478-479:
... if by contract, express or implied, the whole or part of the payment made to the complainant has been in respect of matters which are outside the award entitlement, the payment to that extent cannot be set-off. This may include amounts allocated, say, for fares or as a uniform allowance where there is no award entitlement in respect of such matters. This, of course, is recognised in the majority judgment.
But at this stage I must part company from that judgment because I can see no difference in principle between an amount promised in excess of the award requirement whether the promise is for, say, a uniform allowance or for a payment confined to ordinary time only. In each case, the employee works on the basis that he will receive an extra-award payment and, in my opinion, it is not to the point that in one case its subject matter is clothing and in the other additional remuneration for a nominated period of work. If one cannot be set off, neither can the other because their essential character is identical ie, both are payments in fulfilment of a promise extraneous to the award obligation. The award obligation re clothing may be nil, in regard to ordinary time it may be $X. The extraneous promise is to pay $Y and, whether it is in respect of clothing or ordinary time, it is $Y beyond what the award requires. To put it in more concrete terms, if the award rate for 40 hours work is $40 with overtime payable in addition but the employer agrees to pay a uniform allowance of $5 per week, it is common ground that it is no answer to a claim under s 92 for $40 ordinary time and $5 overtime worked to show that in fact $45 went into the employee’s pocket. If this is so, I regard it as equally no answer if he got $45 only because the employer agreed to pay him that amount for no more than 40 hours work. In each case, as I see it, the employer cannot allocate to one subject matter what he has already paid in pursuance of a promise related to another subject matter. That would be approbating and reprobating.
In Poletti the Court explained this passage at 393:
It is to be noted that there are two separate situations dealt with in the passage from the judgment of Sheldon J which has been quoted and in the reasoning of the Commission in Pacific Publications. The first situation is that in which the parties to a contract of employment have agreed that a sum or sums of money will be paid and received for specific purposes, over and above or extraneous to award entitlements. In that situation, the contract between the parties prevents the employer afterwards claiming that payments made pursuant to the contractual obligation can be relied on in satisfaction of award entitlements arising outside the agreed purpose of the payments. The second situation is that in which there are outstanding award entitlements, and a sum of money is paid by the employer to the employee. If that sum is designated by the employer as being for a purpose other than the satisfaction of the award entitlements, the employer cannot afterwards claim to have satisfied the award entitlements by means of the payment. The former situation is a question of contract. The latter situation is an application of the common law rules governing payments by a debtor to a creditor. In the absence of a contractual obligation to pay and apply moneys to a particular obligation, where a debtor has more than one obligation to a creditor, it is open to the debtor, either before or at the time of making a payment, to appropriate it to a particular obligation. If no such appropriation is made, then the creditor may apply the payment to whichever obligation or obligations he or she wishes: see Halsbury’s Laws of England, 4th ed, vol 9, pars 505 and 506.
In Australian & New Zealand Banking Group Limited v Finance Sector Union of Australia (2001) 111 IR 227 (“ANZ”) the Full Court referred to these passages and said, at 238-239:
[47]For the purpose of resolving this debate it is, we think, useful to return to the passage from Poletti v Ecob quoted in par 41 above. That passage accurately analyses the judgment of Sheldon J in Ray v Radano and enunciates the relevant principle.
[48]The first situation noted in the passage is one where “the parties to a contract of employment have agreed that a sum or sums of money will be paid and received for specific purposes, over and above or extraneous to award requirements”. In that situation, the Full Court said, “the contract between the parties prevents the employer afterwards claiming that payments made pursuant to the contractual obligation can be relied on in satisfaction of award entitlements arising outside the agreed purpose of the payments”. So the critical question is whether the relevant award entitlements arose outside the contractually agreed purpose.
[49]It will usually be easy to determine whether there is a coincidence between particular award entitlements and the contractually agreed purpose. Take the case of an agreement for payment of wages of $1,000 per week to an employee who has an award entitlement to receive wages of $800 per week. Discharge of the contractual obligation will clearly also discharge the obligation to pay wages imposed by the award. On the other hand, take the first example offered by Sheldon J, where an employer agrees to pay a clothing allowance. It is no answer to a claim for underpayment of wages to say there was no award obligation to pay a clothing allowance. Similarly with Sheldon J’s second example: it is no answer to an overtime claim to say the employee has received an over-award payment in respect of ordinary time.
The Court emphasised at [52] that “there must be a close correlation between the nature of the contractual obligation and the nature of the award obligation. But it is not necessary that the same label be used”. Recently, in Linkhill Pty Ltd v Director, Office of the Fair Work Building Industry Inspectorate [2015] FCAFC 99 (“Linkhill”), North and Bromberg JJ explained at [98] that this statement indicated that what is required is a close correlation between the award obligation and the contractual obligation in respect of which the payment was made. The question that arises from these passages is one of characterisation of the payments made to the applicant under the contract of employment: O’Shea v Heinemann Electric Pty Ltd (2008) 172 FCR 475 (“O’Shea”) at 490 [46] and ACE Insurance Ltd v Trifunovski (No. 2) (2012) 215 IR 206 (“Trifunovski”).
Contrary to the applicant’s argument, the principles outlined in these cases were not displaced by the decision in Byrne. The issue in that case was whether the appellants were entitled to damages for breach of contract in circumstances where the termination of their employment had been in breach of an award because it was harsh, unjust or unreasonable. In particular, the question was whether the term in the award prohibiting termination that was harsh, unjust or unreasonable was imported into the terms of the contract of employment. The High Court held that it was not. The passage relied on by the applicant was in the judgment of Brennan CJ, Dawson and Toohey JJ at 421:
In a system of industrial regulation where some, but not all, of the incidents of an employment relationship are determined by award, it is plainly unnecessary that the contract of employment should provide for those matters already covered by the award. The contract may provide additional benefits, but cannot derogate from the terms and conditions imposed by the award and, as we have said, the award operates with statutory force to secure those terms and conditions. Neither from the point of view of the employer nor the employee is there any need to convert those statutory rights and obligations to contractual rights and obligations. There is, therefore, an insuperable obstacle in the way of the appellants’ second argument that the terms of an award such as cl 11(a) are implied terms of the contract of employment.
(Footnote omitted)
That passage has nothing to do with the principles in Poletti. Further, those principles have been applied by the Full Court of the Federal Court (ANZ and Linkhill) and single judges of the Federal Court (O’Shea at 490 and Trifunovski) since the decision in Byrne. For those reasons, I consider that those principles in Poletti are still applicable.
In this case the applicant was paid in excess of the award rate for all time until 7pm during weekdays. There is no issue about payment for weekend work. He was only paid overtime rates (at twice the ordinary rate) for any “time worked after 7pm after working [his] ordinary hours”. The FSA Award provided that “in respect of all time worked beyond the ordinary hours of work … employees must be paid … 150% for the first 2 hours and 200% thereafter”: cl.33.1.
There was, in my opinion, a close correlation between the amounts paid to the applicant under the contract for the time worked up to 7pm and the award obligation to pay overtime rates. The contract envisaged that, although the applicant’s ordinary hours were 40 hour week, he would be working between 8 – 11 hours per day. In that context, the fact that the express provision relating to overtime only applied to work after 7pm supports the conclusion that the amounts paid to the applicant for the period up to 7pm would be made for any overtime as it was understood in the award. Certainly, there is no suggestion that the additional payments were made for a purpose extraneous to the award obligations, such as was the case in Radano. For that reason, the total amounts paid to the applicant for hours worked may be taken into account in determining whether the respondent breached its obligations under the award.
The spreadsheet prepared by Mr Eberhard reveals that, during the relevant period, the applicant was paid in excess of the award obligations and, for that reason, there was no breach of the award.
Unlawful deductions
The applicant argues that the respondent breached s.323 of the Act when it removed his annual leave entitlements in order to compensate for the stolen tools.
Section 323 provides that an employer must pay an employee amounts payable to the employee in relation to the performance of work in full (subject to allowable deductions), in money and at least monthly. Allowable deductions are those permitted by s.324 which include deductions agreed to by the employee in writing and principally for his or her benefit. They do not include amounts to compensate for stolen tools deducted without agreement. The question, then, is whether the leave entitlements were “amounts payable to the employee” at the time they were deducted.
Annual leave entitlements are provided for in the National Employment Standards which are found in Pt 2-2 of the Act. Section 87 of the Act, which is in Pt 2-2, provides for employees’ entitlements to annual leave. Subsection 87(2) provides:
An employee’s entitlement to paid annual leave accrues progressively during a year of service according to the employee’s ordinary hours of work, and accumulates from year to year.
Section 88 provides for the taking of annual leave:
(1)Paid annual leave may be taken for a period agreed between an employee and his or her employer.
(2)The employer must not unreasonably refuse to agree to a request by the employee to take paid annual leave.
Section 90 provides for payment for annual leave:
(1)If, in accordance with this Division, an employee takes a period of paid annual leave, the employer must pay the employee at the employee’s base rate of pay for the employee’s ordinary hours of work in the period.
(2)If, when the employment of an employee ends, the employee has a period of untaken paid annual leave, the employer must pay the employee the amount that would have been payable to the employee had the employee take that period of leave.
In this case, there is no evidence that, at the time the accrued leave was deducted from the applicant, there was any agreement between the applicant and the respondent that he could take a period of annual leave. In those circumstances, annual leave was not payable to the applicant at that time. Accordingly, there was no obligation on the respondent to pay the applicant annual leave and any deduction of the accrued amounts relating to annual leave was not in breach of the obligation under either ss.90 or 323 of the Act. Upon termination, the respondent also paid out the applicant’s leave entitlements, the sum of which was not contested before me. For those reasons this ground must be rejected.
General Protections issue
The applicant claimed that he was terminated because he raised concerns about the award entitlements that he was due, because he had made a claim for WorkCover and because he sought advice about the respondent’s demand that he pay for the stolen tools. The following provisions of the Act are relevant to this claim:
340 Protection
(1)A person must not take adverse action against another person:
(a) because the other person:
(i) has a workplace right; or
(ii) has, or has not, exercised a workplace right; or
(iii) proposes or proposes not to, or has at any time proposed or proposed not to, exercise a workplace right; or
(b)to prevent the exercise of a workplace right by the other person.
....
341 Meaning of workplace right
(1) A person has a workplace right if the person:
(a)is entitled to the benefit of, or has a role or responsibility under, a workplace law, workplace instrument or order made by an industrial body; or
(b)is able to initiate, or participate in, a process or proceedings under a workplace law or workplace instrument; or
(c)is able to make a complaint or inquiry:
(i) to a person or body having the capacity under a workplace law to seek compliance with that law or a workplace instrument; or
(ii) if the person is an employee—in relation to his or her employment.
…
“Adverse action” includes dismissal of an employee: s.342.
When a claim is made under these provisions that action was taken for a particular reason, it is presumed that the action was taken for that reason unless the respondent proves otherwise: s.361. For these purposes, a person takes action for a particular reason if the reasons for the action include that reason: s.360. Because of the terms of s.360, the “otherwise” to which s.361(1) refers cannot be a state of facts that would admit the relevant proscribed reason being one of the reasons for which the action challenged was taken: Murrihy v Betezy.com.auPty Ltd (2013) 238 IR 307 at 354 [152].
The first question to be determined is whether the applicant exercised, or proposed to exercise a workplace right: see sub-ss.340(1)(a)(ii) and (iii). The critical events in this respect took place on 6 December 2012. On that day, the applicant went to see his solicitor and the solicitor telephoned Mrs Di Rosa in connection with certain complaints about the way in which the applicant had been treated. While there was no direct evidence about the contents of that conversation, there followed a letter from the applicant’s solicitor that also raised such issues. The relevant portions of that letter are set out at [47] above. The letter clearly raised the issue of the applicant’s entitlement under the Award to be paid for overtime and the deduction of the annual leave entitlement to compensate for the stolen tools.
The respondent did not contest that this letter constituted either the exercise of a workplace right or the proposal to do so. It was correct to do so either because the “workplace right” in question was the applicant’s entitlement to a benefit under the FSA Award (by virtue of s.45 of the Act) (see sub-s.341(1)(a)) or the applicant’s ability to make a complaint to his employer about his employment: sub-s.341(1)(c)(ii).
The applicant also claimed that he was dismissed because he had made a claim for WorkCover. The respondent also did not contest that this fell within sub-s.340(1)(a)(ii), the exercise of a workplace right. That, too, was correct. The workplace right in question was the benefit to which the applicant was entitled under the Accident Compensation Act 1995 (Vic). That Act is a “workplace law” within the meaning of the Act because it regulates the relationships between employers and employees (including by dealing with occupational health and safety matters): see s.12.
For those reasons, the conduct of the applicant fell within the meaning of s.340 of the Act. The question that arises next is whether the respondent has proven that it did not dismiss the applicant for the reasons claimed.
In Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500 (“Barclay”), French CJ and Crennan J explained at 510 [21] that:
Sections 360 and 361, in Div 7 of Pt 3-1, make it easier than it otherwise would be for an employee to establish a contravention of the protective provisions in Pt 3-1, including s 346. Section 360 provides that, for the purposes of Pt 3-1, a person takes action for a particular reason if the reasons for the action include that reason’. Section 361(1), … casts a burden of proof on an employer to show that it did not take action for a prohibited reason …
Barclay is the leading authority on the operation of ss.360 and 361 of the Act. The principles explained in it were affirmed by the High Court in Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd (2014) 88 ALJR 980. Those principles were summarised as follows by the Full Court of the Federal Court in State of Victoria (Office of Public Prosecution) v Grant [2014] FCAFC 184 at [32]:
…
·The central question to be determined is one of fact. It is: “Why was the adverse action taken?”
·That question is to be answered having regard to all the facts established in the proceeding.
·The Court is concerned to determine the actual reason or reasons which motivated the decision-maker. The Court is not required to determine whether some proscribed reason had subconsciously influenced the decision-maker. Nor should such an enquiry be made.
·It will be “extremely difficult to displace the statutory presumption in s 361 if no direct testimony is given by the decision-maker acting on behalf of the employer.”
·Even if the decision-maker gives evidence that he or she acted solely for non-proscribed reasons other evidence (including contradictory evidence given by the decision-maker) may render such assertions unreliable.
·If, however, the decision-maker’s testimony is accepted as reliable it will be capable of discharging the burden imposed on the employer by s 361.
The respondent’s evidence in this respect was given by Mr Di Rosa, the principal of the respondent. He denied that the matters relied on by the applicant formed any part of the reason for dismissing the applicant and said that the reason for the dismissal was that the applicant could not legally continue to undertake the work of a plumber as he was no longer subject to an apprenticeship agreement and was not registered as a plumber. The evidence was that the respondent first became aware of this when told of it by the Master Plumbers Association and that it was confirmed by the Plumbing Industry Commission.
It is an offence under Victorian law for an unlicensed or unregistered person to carry out plumbing work, although an apprentice may carry out certain work under the supervision of a licensed or registered person: Building Act 1993 (Vic) s.221D. A plumbing apprentice is a person who falls within the meaning of that term in the Education and Training Reform Act 2006 (Vic). That Act defines an apprentice as a person whom an employer has undertaken to train under a training contract. In this case, the respondent had undertaken to train the applicant under a training contract but that contract had expired at the end of January 2010. That means that, to the extent that he was undertaking plumbing work, the applicant was acting in contravention of the Building Act. Further, by directing the applicant to undertake that work, the respondent had been contravening s.221G of that Act. The Plumbing Industry Commissioner (“PIC”) has certain powers under the Building Act in respect of contraventions: see div.10A, s.221ZZZA and following.
Mr Di Rosa gave evidence that he spoke to the PIC who confirmed that he had been acting in contravention of the Building Act. However, the PIC informed him that the applicant could continue to work for the respondent in the same capacity if he obtained provisional registration. That would allow him time to complete his studies and then obtain full registration. As a result of this advice Mrs Di Rosa wrote to the applicant on 6 December 2012 asking the applicant to attend a meeting to discuss these issues. Mr Addison argued that this letter was in direct response to his telephone conversation with Mrs Di Rosa that occurred shortly before the letter was received by email. I reject that contention. The letter was not, on its face, drafted in a hurry, as suggested by Mr Addison. Rather it has all the appearance of a letter drafted with the assistance of legal or other advice. Indeed, Mr Di Rosa gave evidence that the Master Plumbers Association had assisted with drafting the letter. I accept that evidence.
The letter of 6 December 2012 and the record of the meeting on 14 December 2012 contained in the letter of 27 December 2012 are important. They are contemporaneous records that reveal the very real concerns of the respondent in connection with the further employment of the applicant. The discussion that took place at the meeting is set out above. It was entirely consistent with Mr Di Rosa’s evidence in Court that he was concerned only with the applicant’s ability to continue to do plumbing work. Also consistent with that was the letter of 27 December 2012 with which the respondent sent the applicant an application for provisional registration.
There are two matters that might suggest that there were other reasons for which the applicant was dismissed. The first was the deterioration in the relationship between the respondent and the applicant after the tools were stolen in late September 2012; the second is the incident at the Park Hotel on 7 December 2012. In addition to those two matters, Mr Addison argued that Mr Di Rosa, and by extension, the respondent, held strong views that no employee should take WorkCover payments and that he was entitled to deduct whatever amounts from wages he saw fit. I reject that argument. It relied firstly on conversations which had taken place a number of years earlier in which Mr Di Rosa was said to have indicated those views, secondly, on an incident in which Justin Palmer had injured his toe and required medical treatment, and thirdly on evidence that the respondent had deducted $1 from Justin Palmer’s wages to pay for transport. That evidence is not admissible to prove that Mr Di Rosa had a particular state of mind at a later time: Evidence Act 1995, s.97.
I cannot see that the deterioration in the relationship had any relevant connection with the applicant’s dismissal. That is to say, it was not a reason that fell within s.340 of the Act. It will be recalled that the respondent asked the applicant to pay for the stolen tools because they were left unattended at night on a public street in a work vehicle when the applicant had permission to be in possession of that vehicle. That demand was reasonable in the circumstances and I reject the applicant’s evidence that the vehicle’s lock was not working. In any event, the respondent gave the applicant various options in connection with that repayment and the applicant took no steps whatsoever to investigate those steps or to otherwise deal with the issue. One of the options was to deduct the applicant’s leave entitlements to pay for the tools. Again, the applicant did not respond to this. I accept that, when those entitlements were deducted, the respondent believed that it was entitled to act in this way. The reason I accept that is that, when it learned from the Master Plumbers Association that it was not entitled to deduct entitlements, it re-credited them immediately and paid them out upon terminating the applicant’s employment.
Further, and more importantly, the way in which the respondent reacted to the applicant’s WorkCover claim and the letter from his solicitor on 6 December 2012 was, with one exception, entirely appropriate. It engaged with the WorkCover process by sending the applicant the appropriate form, ensuring that he saw a doctor rather than simply a chiropractor, and ultimately met with the applicant and gave him the opportunity to provide evidence to establish his claims.
The exception is Mr Di Rosa’s conduct at the Park Hotel. I accept Justin Palmer’s version of the events of that night. Those events reveal that Mr Di Rosa was very upset that the applicant was claiming that he was owed $60,000. That is understandable from the point of view of the proprietor of a small business. However, the question is whether that indicates that the applicant’s claim was part of the reason for which he was dismissed. I do not think so. First, the respondent had already found out that the applicant could not continue to do plumbing work unless he was registered; secondly, it had acted on that advice and written to him to set up a meeting to discuss that issue. Thirdly, the claim for underpayments was made after the respondent’s letter of 6 December 2012. Fourthly, apart from the outburst at the Park Hotel, Mr Di Rosa acted reasonably and in line with the concerns expressed in Mrs Di Rosa’s letter. Fifthly, the opportunity given to the applicant at the meeting, repeated in the 27 December 2012 letter and again in the 14 January 2013 letter were, contrary to Mr Addison’s contention, entirely reasonable and clearly aimed at enabling the applicant every chance of returning from injury to undertake plumbing work. Finally, I take account of the fact that the outburst took place late on a Friday night when Mr Di Rosa was very drunk.
For those reasons, I find that the respondent has established that none of the matters under s.340 of the Act relied on by the applicant was a reason for which the applicant was dismissed. The claim that the respondent breached that provision is rejected.
Conclusion
I have rejected all of the applicant’s claims. The application will be dismissed.
I certify that the preceding one hundred and thirteen (113) paragraphs are a true copy of the reasons for judgment of Judge Smith
Associate:
Date: 6 August 2015
Annexure 1
| Column 1 | Column 2 | Column 3 | Column 4 | Column 5 | Column 7 | Column 10 | Column 11 | Column 13 | Column 14 | Column 15 | Column 16 | Column 18 | Column 19 | Column 20 | ||||
| Contract of Employment | Awards Rates - Claim | |||||||||||||||||
| Pay Week Date | Contracted Hourly Rate of Pay | Ordinary Hours | Other (RDO, Annual Leave P/C Leave) | Additional Hours (Monday to Friday) (Paid at ordinary hourly rate) | Ordinary Hours and Additional Hours $ Paid (Columns 3, 4 & 5) | Overtime (Sat 1.5 / Sun 2.0) Sat Sun | Overtime (Columns 8 and 9) $ Paid (Paid at overtime rates – 1.5 and 2.0) | Total $ Paid (Columns 7 and 10) | Award Rates | Ordinary Hours (Columns 3 and 4 – Paid at Award Rates) | Overtime (Columns 8 and 9 – Paid at overtime rates – 1.5 and 2.0) | Total $ Paid (Columns 14 and 15 | Additional Hours (Monday to Friday) (Paid at overtime rates 1.5 and 2.0) | Total $ Paid (Columns 16 and 18) | Difference (Total Paid (Column 11) vs Total Paid (Column 19) | |||
| 9/09 2010 | $23.00 1.5 times $34.50 2.0 times $46.00 | 38 | 6.5 | $1,023.50 | 1 | 2 | $126.60 | $1,150.00 | Plumbing and Mach Services Worker Level 1(d) BR $605.34 Hourly Rate $15.93 PFS Award $17.72 1.5 Times $26.58 2.0 times $35.44 | $673.36 | $97.46 | $770.82 | $186.06 | $956.88 | $193.12 | |||
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