Rodney Stranger v WBHO Infrastructure Pty Ltd

[2020] FWC 5468

[2020] FWC 5468

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Rodney Stranger
v
WBHO Infrastructure Pty Ltd
(U2020/5993)

COMMISSIONER WILLIAMS PERTH, 14 OCTOBER 2020

Application for an unfair dismissal remedy - jurisdiction.

[1] This decision concerns an application made by Mr Rodney Stranger (Mr Stranger or the Applicant) pursuant to s.394 of the Fair Work Act 2009 (Cth) (the Act) for an unfair dismissal remedy. The application was lodged on 30 April 2020. The respondent is WBHO Infrastructure Pty Ltd (the Respondent).

[2] The Respondent from the outset raised two jurisdictional objections, firstly that the Applicant earned more than the high income threshold and separately that the Applicant was not dismissed but rather resigned from his employment. If either or both of these jurisdictional objections are upheld the Applicant was not entitled to make this application and it will be dismissed.

[3] Consequently, the matter was listed for a jurisdictional hearing.

[4] At the hearing evidence for the Applicant was given by Mr Stranger and his partner Ms Sophia Moore (Ms Moore). For the Respondent evidence was given by Mr Rob Princi (Mr Princi), Operations Manager of the Respondent, Mr Andy O’May (Mr O’May), the National HR Manager of the Respondent and Ms Danielle O’Hanlon (Ms O’Hanlon), a Recruiter/HR Advisor of the Respondent.

Factual Findings

[5] The Applicant commenced working for the Respondent on 23 July 2019. 1 His employment ended on 9 April 2020.

[6] The Respondent conducts scheduled drug and alcohol screening of its employees.

[7] The Applicant was aware he was required to undertake a drug and alcohol screen at 9:30 a.m. on 9 April 2020.

[8] The evidence of Ms O’Hanlon, which was not challenged in cross examination and I accept, was that on the afternoon before the scheduled drug and alcohol screen Mr Stranger telephoned her and explained he would not pass the drug and alcohol test and when asked what he had taken he replied “cannabis.” 2

[9] The following morning at 8:57 a.m., shortly before the drug and alcohol screening was to occur, Mr Stranger sent an email to Ms O’Hanlon submitting his resignation which was stated to be for “personal reasons.”

[10] Consequently, the Applicant did not undertake the drug and alcohol screening he was scheduled for that day.

[11] The letter of offer made to the Applicant in July 2019 and accepted by him 3 states the position he was employed in was that of a Supervisor.

[12] The base salary stated in Schedule A of the letter of offer was $135,000 and it is stated that the Applicant will be provided with a company-maintained vehicle for the purposes of performing his duties and that personal use of the vehicle is at his Manager’s discretion.

[13] I accept the evidence of Mr O’May that the remuneration value of the vehicle assessed by the Respondent was $19,500 being the total of service, maintenance, registration and insurance costs as well as estimated fuel and the tag expenses. This is broken down into a vehicle lease value of $16,100 and the fuel and eat tag expense value of $3,400.

[14] Mr Stranger worked at a number of different sites during his employment. At some of those he drove in and out to the worksite in the company vehicle. 4

[15] The evidence of Ms O’Hanlon, which I accept, is that during his employment at different sites the Applicant was entitled to additional amounts referred to as ‘project uplifts’. 5

[16] Schedule B to the letter of offer accepted in July 2019 refers to a project uplift of 25% of his base salary when working on a particular project. 6

[17] The evidence is that had Mr Stranger’s employment not ended when it did he was shortly to be mobilised to the Mondium project. 7 Indeed that is why he was scheduled for the drug and alcohol screening.8

[18] I accept the evidence that the amount of project uplift for the Mondium project was 30% which had previously been advised to Mr Stranger by email. 9

[19] I find that the project uplift is a payment that can be determined in advance.

[20] The evidence is that there were some periods during which the Applicant did not receive the project uplift for a number of reasons to do with being on annual or personal leave or working for short periods on projects which did not attract an uplift. 10

[21] Mr Stranger also had use of a company laptop and mobile phone. 11

[22] Mr Stranger’s offer of employment at clause 9 provides that he is entitled to the benefit of a Salary Continuance (Income Protection) plan at no cost to him.

The legislation

[23] Section 382 of the Act, set out below, prescribes preconditions for an employee to be protected from unfair dismissal.

“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.”

[24] One of those preconditions is that the person’s annual rate of earnings plus any other amounts worked out in accordance with the Fair Work Regulations 2009 is less than the high income threshold.

[25] Relevantly regulation 3.05 (6) states as follows,

“3.05 When a person is protected from unfair dismissal—high income threshold

…

(6) If:

(a) the person is entitled to receive, or has received, a benefit in accordance with an agreement between the person and the person’s employer; and

(b) the benefit is not an entitlement to a payment of money and is not a non‑monetary benefit within the meaning of subsection 332(3) of the Act; and

(c) the FWC is satisfied, having regard to the circumstances, that:

(i) it should consider the benefit for the purpose of assessing whether the high income threshold applies to a person at the time of the dismissal; and

(ii) a reasonable money value of the benefit has not been agreed by the person and the employer; and

(iii) the FWC can estimate a real or notional money value of the benefit; the real or notional money value of the benefit estimated by the FWC is an amount for subparagraph 382(b)(iii) of the Act.”

[26] The high income threshold for financial year 2019 – 2020 was $148,700.

Consideration

[27] I am satisfied that the Applicant or was not covered by an award or enterprise agreement.

[28] I find that Mr Stranger’s annual earnings were made up of the base salary of $135,000, plus in the past a project uplift of 25% of his base salary which had been paid for most but not all weeks of his 37 weeks of employment, plus the money value of private use of the company vehicle, personal use of the mobile phone and laptop plus the money value of the salary continuance insurance provided.

[29] The evidence is that had Mr Stranger remained in employment a project uplift of 30% of his base salary would have been payable which I find was part of his future annual earnings.

[30] The applicable high income threshold was $148,700. Mr Stranger’s base salary was $135,000 per annum. The difference between the two amounts is $13,700.

[31] If the total value of his annual earnings from the project uplift plus private use of the vehicle, mobile phone and laptop plus the salary continuance insurance value amount to more than $13,700 then Mr Stranger was not an employee protected from unfair dismissal.

[32] To determine Mr Stranger’s past annual earnings from the project uplift the historical amount paid over his 37 weeks of employment can be used to extrapolate a full year’s earnings.

[33] The pay slips show he received payments for the project uplift in total of $19,366 over the 37-week period of his employment. Therefore, this would equate to $27,217 for a full year’s project uplift earnings.

[34] Of course if his employment had not ended he would have enjoyed the 30% project uplift and using the same approach this is valued at $32,660 annually.

[35] Adding only the annual earnings from the 25% project uplift to the base salary means his annual earnings in the past was at least $162,217 but in future with the 30% project uplift Mr Stranger’s annual earnings was going to be $167,660. This minimum value of his annual earnings does not include any value being added for the use of the vehicle, mobile phone and laptop or salary continuance insurance.

[36] An alternative calculation can be made based on Mr Stranger’s payslips attached to Mr O’May’s witness statement. 12 These show that at the last payment date of 29 April 2020 his year-to-date taxable income was $124,601, which included $4,039 as annual leave paid out. Deducting this amount for annual leave his earnings for 37 weeks was $120,562. Had he worked for a full year this would have equated to annual earnings of $169,430 not including any value being added for the use of the vehicle, mobile phone and laptop or salary continuance insurance.

[37] Consequently I am satisfied, considering only the amount of Mr Stranger’s base salary and the project uplift (either 25% or 30%), that his annual rate of earnings was in excess of the high income threshold which was $148,700.

[38] I note for completeness with respect to Mr Stranger’s submission that no value for the company provided vehicle should be included when determining his annual rate of earnings that the Commission in previous decisions 13, has determined that an employee’s travel between his or her home and their place of work is personal rather than work-related travel. Consequently, the value of this private personal travel is to be included when determining an employee’s annual rate of earnings.

[39] Additional amounts would be added to Mr Stranger’s annual rate of earnings for the value of the personal private use of the company vehicle, mobile phone and laptop and the value of the salary continuance insurance provided. It is however unnecessary to calculate these separate additional earnings amounts in the circumstances.

[40] Mr Stranger’s annual rate of earnings was more than the high income threshold. Consequently, by virtue of section 382 of the Act, Mr Stranger is not a person protected from unfair dismissal and so is not able to make this application.

[41] Consequently, it is not necessary for the Commission to determine whether or not Mr Stranger was dismissed.

[42] This application is dismissed and an order [PR723541] to that effect will now be issued.

Appearances:

R. Stranger on his own behalf.
T. Moltoni of IRIQ Law, solicitor for the Respondent.

Hearing details:

2020.
Perth:
August 17.

Printed by authority of the Commonwealth Government Printer

<PR723540>

 1   Exhibit R2, Annexure E at Schedule A.

 2   Transcript at PN286.

 3   Exhibit R2, Annexure E at Schedule A.

 4   Transcript at PN429 and PN431.

 5   Exhibit R4 at paragraphs 14 to 17.

 6   Transcript at PN456 and PN457.

 7   Ibid., at PN464 and PN473.

 8   Ibid., at PN466 and PN467.

 9   Ibid., at PN472.

 10   Exhibit R3 at paragraph 5.

 11   Transcript at PN474 and PN475.

 12   Exhibit R3, Annexure A.

 13   See Zappia v Universal Music Australia Pty Limited T/A Universal Music Australia[2012] FWA 3208 at paragraph 17.