Rebecca Huggett v FinXL Professional Services Pty Ltd

[2023] FWC 3008

[2023] FWC 3008

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.365—General protections

Rebecca Huggett
v

FinXL Professional Services Pty Ltd; IP Australia

(C2023/4954)

COMMISSIONER MCKINNON SYDNEY, 17 NOVEMBER 2023

Application to deal with contraventions involving dismissal – when the dismissal took effect – application out of time – no exceptional circumstances – application dismissed

1. Ms Rebecca Huggett was engaged by FinXL Professional Services Pty Ltd (FinXL) to work for IP Australia, a Commonwealth Government agency. Her work for IP Australia commenced on 5 June 2023 and her last day of work for IP Australia was 19 July 2023 (although Ms Huggett contends that she was dismissed on 26 July 2023). She was engaged as an SAP Business Analyst, earning a daily “contract rate” of $880 per day plus GST.

1. On 16 August 2023, Ms Huggett filed an incomplete application under s.365 of the Fair Work Act 2009 (the Act) for the Commission to deal with a general protections dispute involving her dismissal. Both FinXL and IP Australia object to the application on the basis that Ms Huggett was not dismissed (because she was not an employee) and because the application is filed out of time.

1. It is only necessary to deal with the second of these objections. For the reasons that follow, the application was not made within 21 days after the alleged dismissal took effect. No additional time can be allowed for the application to be made and it will instead be dismissed.

When did the alleged dismissal take effect?

1. Section 386 of the Act deals with the meaning of dismissal. A person has been dismissed if their employment has been terminated on their employer’s initiative, or they have resigned from their employment, but were forced to do so because of conduct, or a course of conduct, engaged in by their employer. Section 366(1) requires an application for the Commission to deal with a dismissal dispute under Part 3-1 of the Act to be made within 21 days after the dismissal took effect, or if there are exceptional circumstances, such further period as the Commission allows.

1. In Ayub v New South Wales Trains (Ayub)[1] a dismissal was found not to take effect until communicated to and known by the affected employee. Ayub cites the earlier case of Stevanovski v Linfox Transport[2] as authority for the proposition that at common law, an employment contract is terminated with effect from the date the termination is communicated to the employee and when “clear on its terms”.

1. The facts relevant to termination of Ms Huggett’s contract are these.

1. On 3 April 2023, FinXL and IP Australia entered into a Work Order for the conduct of professional services and consulting by personnel who were, among other things:

1. encouraged to participate in continuous professional development training at their own cost, and

2. able to work as part of a blended team and work flexibly as needed to deliver the services.

1. On 10 May 2023, Ms Huggett was contacted about the potential of working for FinXL on its contract with IP Australia. After an interview on 12 May 2023, Ms Huggett was offered work through FinXL for IP Australia for 3 days per week. She was offered the choice of working as an employee or contractor and chose the latter. Agreement was reached on a contract for services on the basis of a nominal daily rate of $880.00 per day (plus GST).

1. On 31 May 2023, the Work Order between FinXL and IP Australia was varied to add Ms Huggett as one of the “specified personnel” for the purposes of the contract.

1. On 5 June 2023, Ms Huggett commenced work for IP Australia as a contractor to FinXL’s related entity, FinXL Professional Services Pty Ltd t/as Southern Cross Computing and Powerpays Pty Ltd, a contract management company engaged by FinXL in relation to its contract with Ms Huggett.

1. A formal contract for services was executed between the relevant parties on 14 June 2023. The contract is consistent in its use of language and adoption of terms common to a contract of this kind, including a fee for service arrangement, disclaimer of any employment relationship or related entitlements, provision for tax, costs and insurance, and recovery of costs in relation to defective work. The contract identifies the “Contractor” as Powerpays Pty Ltd; the “Consultant” as Ms Huggett, the “Company” as FinXL Professional Services Pty Ltd, and the “Client” as IP Australia. Clause 3.3 of the contract expressly provides as follows:

“The Contractor agrees that it is an independent contractor and the Consultant is an employee/sub-contractor/agent of the Contractor and not the Company. Nothing in this Agreement shall be construed so as to create an employment relationship, partnership, subsidiary or joint venture between the Company and the Contractor or the Company and the Consultant. The Contractor and the Consultant acknowledge that the relationship between the parties was structured in this way at their request.”

1. On 12 July 2023, IP Australia wrote to FinXL about termination of Ms Huggett’s engagement.

1. On 13 July 2023, IP Australia (through Mr Vishal Mehta) spoke with FinXL (Mr Kaushal Vakharia) and asked that Ms Huggett be “finished up” after 19 July 2023. IP Australia then sent a change order for the removal of Ms Huggett as one of the “specified personnel” on the Work Order between them.

1. On 14 July 2023, Mr Vakharia tried to call Ms Huggett without success.

1. On the morning of 17 July 2023, Ms Huggett called Mr Vakharia. He told Ms Huggett that IP Australia was pausing the work she was engaged upon, and that her assignment would end at the end of Wednesday 19 July 2023. He asked her to work until the end of the day on Wednesday to complete any necessary tasks.

1. On 18 July 2023, Mr Vakharia sent an email to Ms Huggett. The email said:

   “As discussed over the phone yesterday, I would like to formally email you to let you know that the Client has paused the work regarding SOLMAN testing. The Client has notified me to let you know that this Wednesday, 19/07/2023, will be your last day”.

1. On 20 July 2023, the Change Order was signed by the parties to give effect to the removal of Ms Huggett as one of the “specified personnel” from 19 July 2023.

1. Ms Huggett’s application identifies the effective date of dismissal as 26 July 2023, but also that she was notified of the alleged dismissal verbally on 17 July 2023 and formally via email on 18 July 2023. There is no evidentiary basis to support the assertion that termination of the contract took effect on 26 July 2023. The only events connected to that date are a text message, and subsequent email, from Mr Mehta to Ms Huggett about her return of property after the end of the assignment. Neither indicates any basis for concluding that the contract for services continued after 19 July 2023. The other significance of 26 July 2023 is that exactly 21 days later, Ms Huggett filed the first version of this application, which was incomplete.

1. I find that Ms Huggett’s contract was terminated on 17 July 2023 when notice of the termination of her assignment was given to Ms Huggett. It was clear to Ms Huggett from that conversation that her contract had been terminated. But if I am wrong about that, and it was not clear to Ms Huggett on 17 July 2023, Mr Vakharia’s email of 18 July 2023 put the question beyond any doubt including that her last day would be 19 July 2023.

1. I find that the alleged dismissal took effect on 19 July 2023.

Should additional time be allowed for the application to be made?

1. The consequence of this finding is that the application filed by Ms Huggett was made more than 21 days after the alleged dismissal. This was 7 days outside the prescribed timeframe in s.366(1)(a) of the Act. If the application is to proceed, a further period of time in which to file the application must be allowed (s.366(1)(b)).

1. Section 366(2) of the Act provides as follows:

“(2)The FWC may allow a further period if the FWC is satisfied that there are exceptional circumstances, taking into account:

(a) the reason for the delay; and

(b) any action taken by the person to dispute the dismissal; and

(c) prejudice to the employer (including prejudice caused by the delay); and

(d) the merits of the application; and

(e) fairness as between the person and other persons in a like position.”

1. Ms Huggett has not applied for additional time in which to make her claim and has not filed any submissions in support of such an application. On the material before me, and when the matters below are each taken into account, I cannot find any exceptional circumstances that would permit additional time to be allowed to Ms Huggett to make her application.

1. Reason for delay: No reason is given for the delay in filing the application. There is only the assertion in Ms Huggett’s application that the application was filed in time. There is reference in the materials to periods during which Ms Huggett required medical treatment, but none help explain how this might have contributed to the delay. There was apparently a 5-day hospital stay from 17 to 22 July 2023, which might explain a delay of approximately 3 days, and a surgery on 28 July 2023, which might explain a short additional delay, although there is no evidence about how this affected Ms Huggett, or for how long. These matters must be seen in light of ongoing correspondence between FinXL and Ms Huggett about the end of her assignment during the period from 27 to 31 July 2023 (including a reference to potential legal action). This correspondence indicates that during this period, Ms Huggett had the ability to take any steps she wished to dispute the dismissal. There is separately an assertion in her application to Ms Huggett becoming homeless, but there is no evidence or further elaboration in relation to the matter and for that reason it carries limited weight.

1. Action to dispute the dismissal: From 27 to 31 July 2023, Ms Huggett was actively communicating with FinXL about her perspective on the termination of her engagement. While she foreshadowed the potential for legal action, none was taken until 16 August 2023.

1. Prejudice to the employer: Neither FinXL or IP Australia appear to meet the description of ‘employer’ in relation to Ms Huggett. To the extent that this matter is relevant, however, there is no apparent prejudice to either FinXL or IP Australia if additional time is allowed for the application to be made. A 7‑day delay is only short and each was on notice that the termination of Ms Huggett’s engagement was in dispute.

1. Merits: The merits of the application are not strong, because it is unlikely that there was any employment relationship between the parties. Only an employee can be dismissed, and only a person who has been dismissed can apply to the Commission under s.365 of the Act. If additional time were allowed, the application would most likely be dismissed on jurisdictional grounds.[3]

1. Fairness as between Ms Huggett and another person in a like position does not appear to be a relevant consideration in this case.

Conclusion

1. On the facts of the case, I am not satisfied that there are exceptional circumstances such that additional time can be allowed to Ms Huggett to make her application to the Commission. The application was not filed within 21 days after the alleged dismissal took effect and for this reason, was not made in accordance with the Act.

1. The application is dismissed under s.587(1)(a) of the Act.

COMMISSIONER

Appearances:

No appearance for the Applicant.
L Saunders of Counsel for FinXL Professional Services Pty Ltd.
Y Truong of Counsel for IP Australia.

Hearing details:

2023.
Sydney (by video):
November 8.

[1] [2016] FWCFB 5500 at [21].

[2] [2001] AIRC 388; PR903594.

[3] Grass v NSW Chinese Tennis Association Inc. [2021] FWCFB 3443.

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