Ravinder Kaur v K B N Enterprises Pty Ltd as trustee for Nazar Family Trust T/A Corandirk House

[2013] FWC 1849

[2013] FWC 1849

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Ravinder Kaur
v
K B N Enterprises Pty Ltd as trustee for Nazar Family Trust T/A Corandirk House
(U2012/14828)

Rehmat Singh
v
K B N Enterprises Pty Ltd as trustee for Nazar Family Trust T/A Corandirk House
(U2012/14830)

COMMISSIONER BISSETT MELBOURNE, 5 APRIL 2013

Section 394 - application for relief from unfair dismissal - s.23 definition of small business - number of employees - related companies have no employees - minimum employment period not reached - jurisdictional objection upheld.

[1] Ms Ravinder Kaur and Mr Rehmat Singh (the Applicants) have each made applications for relief from unfair dismissal pursuant to s.394 of the Fair Work Act 2009 (the Act) with respect to each of their dismissals from KBN Enterpises Pty Ltd t/a Corandirk House (the Respondent). Both Ms Kaur and Mr Singh were dismissed from their employment on 26 October 2012. Ms Kaur commenced employment on 6 February 2012 and Mr Singh commenced employment on 19 March 2012. Ms Kaur was therefore employed for eight months and Mr Singh for seven months.

[2] The Respondent says that the Fair Work Commission (the Commission) does not have jurisdiction to hear either of the applications as the Respondent is a small business within the meaning of s.23 of the Act. Neither Ms Kaur nor Mr Singh has more than six months employment, therefore they are not protected from unfair dismissal within the meaning of the Act.

Evidence and submissions

[3] Following the receipt of evidence and submissions I requested that the Respondent provide to the Commission and the Applicants copies of the contract, invoice and payments with respect to the engagement of Ms Dudley and also that it provide documents in relation to the nominee advice to the Department of Human Services (DHS). These documents are relevant to my determination of the matter and were subsequently provided. Upon receipt of these the Applicants and Respondent were invited to make final written submissions.

[4] I have taken into account all of the evidence, submissions and additional material in making my decision on this matter.

[5] The Applicants claim that the Respondent had, at the time of their dismissal, at least 15 employees, including themselves.

[6] In particular the Applicants claim that, at the time of the dismissal, the Respondent employed:

● Dr Khaled Nazar
● Mrs Fatima Nazar
● Mr Raahem Nazar
● Ms Sharon Dudley

[7] The Applicants also initially sought to argue that the Respondent employed a number of students on vocational placement and Reham Moledina, Claire Incorvaia and Jackline Rono. During oral submission the Applicants indicated that they no longer sought to rely on these named individuals or anyone engaged on vocational placements.

[8] The Applicants submit that by virtue of the Supported Residential Services (Private Proprietors) Act 2010 (Vic) (the SRS Act) the proprietor is required to employ a person or persons to manage the supported residential service when the proprietor is not ordinarily on site on a day to day basis.

[9] They say that Mrs Nazar and Dr Nazar are named as managers and therefore are employees of the Respondent ‘as they benefit the company by satisfying Section 67’ of the SRS Act.

[10] Mr McMonnies for the Applicants did not take me to that Act in any other respect.

[11] The Applicants submit that Ms Dudley is an employee on the basis of her evidence that she was employed and because of a failure of the Respondent to produce her contract.

[12] The Applicants also say that the Respondent has failed to declare any employees of two related entitles, the Nazar Family Super Fund Pty Ltd and DAEM Holdings Pty Ltd.

[13] The Applicants called no evidence.

[14] Dr Nazar gave evidence for the Respondent. His evidence is that he is the sole Director of the company and that neither he, his wife Fatima Nazar nor his son Raahem Nazar is employed by the Respondent. His evidence is that his wife teaches part time (80% load) and his son is a student.

[15] Dr Nazar says that he earns no money from the business which is run through a family trust. If the business makes money he may get a distribution through the trust. Dr Nazar says he is employed full time by Telstra.

[16] Both his wife and son are named as nominees (or ‘place holders’) for the purposes of documents filed with DHS but neither is employed by the Respondent.

[17] With respect to Ms Dudley, Dr Nazar’s evidence is that she was contracted for one day to provide services to the Respondent in October 2012. She provided a report to the Respondent which was then the subject of some discussion between Dr Nazar and her. She commenced working full time for the Respondent in December 2012.

[18] As to employees of Nazar Family Super Fund Pty Ltd and DAEM Holdings Pty Ltd, Dr Nazar’s evidence is that the Super Fund has no employees and the DAEM Holdings was deregistered in 2010.

[19] Ms Dudley’s evidence is that she was not employed by the Respondent on 26 October 2012. She was engaged by the Respondent as a consultant for one day. She provided a report as a result of her work. Dr Nazar did contact her after she produced the report with some questions on the report. Ms Dudley says however that she was not paid for any work beyond the one day. She did have contact with Ms Kaur following the one day of work, however she says that this was a follow up from that day’s work.

[20] The Respondent submits that there is no evidence that either Mrs Nazar or Mr Nazar are employees of the Respondent. The material lodged with the Commission in accordance with the directions given at the hearing show that each is a ‘placeholder’ or nominee and that such nomination does not render either an employee. Further, the Respondent submits, this material demonstrates that Ms Kaur was nominated as manger.

[21] With respect to Ms Dudley the Respondent says that the oral and documentary evidence establishes that she was not an employee of the Respondent at the relevant time.

[22] The Applicant submits that, in determining if a person is an employee it is necessary to consider a number of indicia including the intention of the parties, the nature of the contract, matters of direction, control and supervision, mode of remuneration and so on.

[23] The Applicant submits that Ms Kaur was employed as the manager until the date of her dismissal.

Legislation

[24] Section 396 of the Act requires that, prior to considering if a person has been unfairly dismissed, the Commission must decide if the person is (amongst other things) protected from unfair dismissal.

[25] If a person is not protected from unfair dismissal the Commission cannot consider the application as there is no jurisdiction to do so.

382 When a person is protected from unfair dismissal

A person is protected from unfair dismissal at a time if, at that time:

(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and

(b) one or more of the following apply:

(i) a modern award covers the person;

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

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

383 Meaning of minimum employment period

The minimum employment period is:

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

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

(ii) immediately before the dismissal; or

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

23 Meaning of small business employer

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

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

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

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

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

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

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

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

[26] The date at which the number of employees of the Respondent is to be determined is 26 October 2012 as this is the date both Ms Kaur and Mr Singh were dismissed.

[27] The matter to determine therefore is if the Respondent is a small business.

[28] As is also relevant to this matter, section 67 of the SRS Act states:

67 Requirement to employ manager

A proprietor must employ a person to manage the supported residential service if at any time the proprietor, or in the case of a proprietor that is a body corporate any of the directors, is not ordinarily on site to carry out, direct or undertake the day to day operation of the supported residential service.

Penalty: 120 penalty units, in the case of a natural person;

600 penalty units, in the case of a body corporate.

Consideration

[29] It is not contested that the relevant date for the purpose of determining the number of employees of the Respondent is 26 October 2012.

[30] It is also not contested that neither Ms Kaur nor Mr Singh had 12 months service with the Respondent at the time each was dismissed. The Respondent says it is a small business within the meaning of the Act and therefore the applications must fail for want of jurisdiction.

[31] There is also no dispute that, on 26 October 2012, there were at least 13 employees of the Respondent. These employees are set out in the statutory declaration of Dr Nazar. 1

[32] It remains to be determine the employment status of Dr Khaled Nazar, Ms Fatima Nazar, Mr Raahem Nazar and Ms Sharon Dudley as at 26 October 2012.

Are Mrs Nazar and Mr Nazar employees by virtue of the SRS Act?

[33] The material provided to the Commission and filed with the Department of Health indicates that Ms Ravinder Kaur (one of the Applicants in this matter) is the ‘Full time Manager/Personal Care Coordinator’, that Mrs Nazar and Raahem Nazar are each ‘Part time Manager (nominee)’ and that Ms Soulla Harzistamatis is the ‘Personal Care Coordinator’.

[34] I accept Dr Nazar’s evidence that Ms Kaur is the named manager for the purpose of s.67 of the SRS Act. It is not clear what the role of a ‘nominee’ is.

[35] It is not clear to me what benefit Mrs Nazar or Mr Nazar gain from being nominees. In any event, this is an assertion of the Applicants, no evidence to supports this claim.

[36] The SRS Act requires that the proprietor ‘employ a person to manage’ the supported residential service. Nothing is said of the need to employ more than one person. In this respect it would appear that Ms Kaur is the Manager as required under s.67 of the SRS Act.

[37] I therefore find that neither Mrs Nazar nor Mr Nazar is an employee by virtue of s.67 of the SRS Act.

Dr Khaled Nazar

[38] Dr Nazar gave evidence that he is not employed by the Respondent. No contrary evidence was adduced. I therefore find that, on 26 October 2012 Dr Nazar was not employed by the Respondent.

Mrs Fatima Nazar

[39] In addition to my finding above in respect to the SRS Act I find that Ms Fatima Nazar is not an employee of the Respondent.

Mr Raahem Nazar

[40] In addition to my finding above in respect to the SRS Act I find that Ms Fatima Nazar is not an employee of the Respondent.

Ms Sharon Dudley

[41] There is no evidence to support any finding that Ms Dudley was an employee of the Respondent on 26 October 2012. She was, in October, engaged by the Respondent as a consultant. The material provided by the Respondent shows that she was engaged for 7 hours work, billed for this work and was paid. That she provided advice to the Respondent following this work does not make her an employee.

[42] There is nothing in the relationship between Ms Dudley and the Respondent to suggest that, on 26 October 2012 she was employed by the Respondent.

[43] I find that Ms Dudley was not an employee of the Respondent at the relevant time.

Related entities

[44] The Applicant did not make any submissions beyond a statement that the Respondent had filed to declare employees of two related companies.

[45] On the basis of the uncontested evidence of Dr Nazar I find that the Nazar Family Super Fund Pty Ltd has no employees and that DAEM Holdings Pty Ltd is not a registered company. There are, therefore, no employees of related companies.

Conclusion

[46] For these reasons I find that the Respondent is a small business within the meaning of s.23 of the Act in that, as at 26 October 2012, it had less than 15 employees.

[47] Neither of the Applicants has more than 12 months service with the Respondent. Neither of the Applicants is therefore protected from unfair dismissal.

[48] For this reason the Commission has no jurisdiction to hear either application. The applications are therefore dismissed. Orders to this effect will be issued.

COMMISSIONER

Appearances:

A. McMonnies for the Applicants.

B. Myers of Counsel for the Respondent.

Hearing details:

2013.

Melbourne;

22 February.

Final written submissions:

Applicant, 4 March 2013.

Respondent, 5 March 2013.

 1   Exhibit R2.

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