Ryan Zosel v The Grace Freeman Nelson Trust T/A Landsculpture Design & Construction Pty Ltd T/A Landsculpture

[2016] FWC 5183

[2016] FWC 5183

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Ryan Zosel
v
The Grace Freeman Nelson Trust T/A Landsculpture Design & Construction Pty Ltd T/A Landsculpture
(U2016/5111)

DEPUTY PRESIDENT KOVACIC MELBOURNE, 1 AUGUST 2016

Application for relief from unfair dismissal - Applicant not dismissed - application dismissed.

[1] Mr Ryan Zosel (the Applicant) made an application on 3 March 2016 under s.394 of the Fair Work Act 2009 (the Act) alleging that he had been dismissed by The Grace Freeman Nelson Trust T/A Landsculpture Design & Construction Pty Ltd T/A Landsculpture (the Respondent) on 9 February 2016 and that the dismissal was unfair.

[2] In its Form F3 – Employer Response to Unfair Dismissal Application the Respondent raised two jurisdictional objections, contending that Mr Zosel was not employed by it as he was an independent contractor and that the application had been lodged outside the 21 day timeframe specified in s.394(2) of the Act as Mr Zosel finished his subcontracting arrangement with it in November 2015.

[3] The Fair Work Commission (the Commission) issued Directions on 11 May 2016 requiring the parties to file an outline of submissions and any evidentiary material they intended to rely on regarding the extension of time issue.

[4] The extension of time issue was the subject of a hearing on 10 June 2016. At the hearing, Mr Garry Dircks appeared with permission for Mr Zosel, while Mr James Catlin of Counsel appeared with permission for the Respondent. Mr Zosel gave evidence on his own behalf, while Mr Rick Lomagno, the Respondent’s Principal Director, gave evidence for the Respondent.

[5] For the reasons outlined below, I have concluded that Mr Zosel was not dismissed as per s.386 of the Act and that, as such, Mr Zosel does not meet the requirement set out in s.394(1) of the Act. Mr Zosel’s application is therefore incompetent and must be dismissed.

Background

[6] Mr Zosel commenced working with the Respondent in 2004 and with the exception of a six month period in 2007 when he was overseas Mr Zosel has worked for the Respondent since then. However, it was not disputed that while working for the Respondent Mr Zosel and other employees of the Respondent were able to work on other jobs which were not the Respondent’s jobs.

[7] Mr Zosel contended that he first raised concerns about his entitlements in 2011. The Respondent disputed this with Mr Lomagno attesting that Mr Zosel first raised the issue of entitlements around late October/early November 2015. In late 2015 Mr Zosel lodged a Request for assistance – workplace dispute form with the Fair Work Ombudsman (FWO) regarding the alleged underpayments.

[8] In other developments, Mr Zosel sent Mr Lomagno a text message at 7:08pm on 18 November 2015 which stated, inter alia, that:

“… We have had communication breakdown, I’m stressed with vcat and think it’s in everyone’s best interest I at least take a break from landsculpture. I have emptied my stuff from the truck and parked it out front of my house. Pick it up when you want … Let’s try talk again next week.” 1 (Underlining added)

[9] At 2:41pm on 2 December 2015 Mr Lomagno sent Mr Zosel the following text message:

“Hi Ryan.. Hope your well. Did you want to catch up, so I can sort out what we discussed a few weeks ago? Let me know please.
Cheers Rick.”

[10] Mr Zosel replied by way of email at 4:02pm that day in the following terms:

“Hello,
I am OK but we are not OK. I have been waiting for your offer for some time now but nothing has been produced. You said you would have something early last week. This isn’t going to go away by ignoring it.

…

I have been advised by my mediator at fairwork that we should try to settle this between us. He has provided me with information to calculate my leave entitlements and I can produce a figure which I think I’m owed.

Are you interested in trying to settle this between us or do you want to go straight to mediation?” 2

[11] Further emails were exchanged between the two later that day and on 3 December 2015 Mr Lomagno sent an email to Mr Zosel which stated:

“Ryan
Can u please give me a date so we can settle the concerns you have.
I don’t want you to think I’m ignoring it.
Let’s sort it out next week,and part ways on good terms,if that’s possible.
Rick” 3 (Formatting as per original, underlining added)

[12] Mr Zosel replied at 7:50pm that day as follows:

“Rick,
By your previous emails you make it clear I no longer have a job. I’m being sacked for raising a pay dispute which is unfair dismissal. I don’t feel you’re interested in settling my concerns, I raised this month’s ago and so far you have offered nothing and now I’m unemployed for raising my concerns …” 4

[13] Mr Lomagno responded at 8:13pm that evening, with his email stating:

“Ryan,
I have a text from you message saying you want a break from Landsculpture.
But I can’t seem to be able to talk to you face-to-face to settle this Fairly.
I texted you all last week,no response, emailed you yesterday about meeting up, no response.
All you seem interested in is trying to trap me into writing something by email.
So I will make it clear..YOU HAVE NOT BEEN SACKED. AND I WANT TO MEET UP IN PERSON ASAP AND RESOLVE YOUR CONCERNS.
Please let me know when and where we can meet.
Rick” 5 (Formatting as per original, underlining added)

[14] Further emails were exchanged between Mr Zosel and Mr Lomagno on 6 and 8 December 2015.

[15] On 19 December 2015 an employee of the Respondent, Mr Mohammed Elorr, went to Mr Zosel’s home and requested that he return his uniform and any of the Respondent’s tools that he still had. Mr Zosel deposed in his witness statement 6 that he asked Mr Elorr whether he had been sacked, with Mr Elorr responding that he still had a job. Mr Zosel further deposed that his wife called Mr Lomagno regarding the incident, prompting Mr Lomagno, who was on holidays at the time, to send Mr Zosel the following text on 19 December 2015:

“Hi Ryan. I just want you to know that Mo went round to your house without my knowledge. I did not instruct him to retrieve tools or uniforms from you. Rick.”

[16] In subsequent developments, the alleged underpayments issue was the subject of an unsuccessful FWO mediation on 25 January 2016 7. Also in late January 2016, Mr Zosel contacted Mr Lomagno seeking confirmation of his employment status and was advised by Mr Lomagno to contact Mr Patrick Kelly who he had engaged to act for him in the matter. An email exchange between Mr Zosel and Mr Kelly did not clarify the situation to Mr Zosel’s satisfaction, resulting in Mr Zosel on 9 February 2016 sending the following email to both Mr Lomagno and Mr Kelly:

“Dear sirs,

I have requested on several occasions what my employment status is with Landsculpture design and construction pty.ltd. to no avail. I can confirm that I have never provided a written or verbal resignation.

I have not been provided with my next job site information or had any contact from Richard Lomagno to advise that my employment has been terminated nor have I received my termination notice.

The last correspondence I received in relation to my employment status was via email on 3rd of December 2015. In this email Richard Lomagno confirmed that I had not been fired.

My request is for my next job site/work day and the return of my company uniforms & truck, which were required by Richard Lomagno to be returned on an agreed leave so they could be used by his other employees.

If in seven days from this letter I have not received any work, the return of the uniforms and company truck this letter will be taken as the termination of my employment by Landsculpture design and construction pty.ltd. Should the termination of my employment become the outcome from this letter I reserve my rights until this matter had been resolved.” 8

[17] In the absence of any response from either Mr Lomagno or Mr Kelly, Mr Zosel lodged his unfair dismissal application on 3 March 2016.

The Applicant’s case

[18] Mr Zosel submitted that there was no credible claim that he was either dismissed or had resigned at any stage prior to 16 February 2016 which he further submitted was the effective date of termination. Mr Zosel also contended that there was no dismissal or resignation in November 2015 only an agreement that he take a break from work, adding that he made it explicit on a number of occasions after the break had commenced that he had not resigned.

[19] At the hearing, Mr Zosel submitted that there could be no sensible construction of the term “break” as meaning resignation, adding that in this case it meant an interruption to the continuation of work as opposed to a cessation of the employment relationship. Mr Zosel further submitted that the Respondent’s failure to give any assurance whatsoever as to his employment status was action which, on any reasonable view, would have the effect of bringing about a termination of the employment. Mr Zosel added that in the circumstances this constituted a termination initiated by the employer. Beyond this, Mr Zosel disputed that he had abandoned his employment as he had kept in constant contact with the Respondent and there was no evidence that it was his intention to bring the employment to an end.

[20] In his witness statement 9 Mr Zosel deposed that he had been asking Mr Lomagno since 2011 about his workplace entitlements and that from mid-2015 he started to get “fed up” with Mr Lomagno not doing anything about his entitlements. Mr Zosel set out in his witness statement a chronology of the communication between himself and Mr Lomagno and others which included the communications set out at paragraphs [8]-[16] above, contending that as the Respondent continually refused to confirm his employment status the first time he could definitively say that his employment had been terminated was 16 February 2016. As such, Mr Zosel contended, his application had been lodged with the 21 day statutory timeframe.

[21] Key aspects of Mr Zosel’s oral evidence were that:

• he did not dispute Mr Lomagno’s evidence that in mid-November 2015 he was going to do a job in Hawthorn for himself which paid $3000 per week;



• he would have spent about 20 days in 2015 working on jobs other than the Respondent’s jobs;



• he rejected the Respondent’s 2014 offer of full-time employment on financial grounds;



• his return to work with the Respondent was conditional on his entitlements issues being resolved;



• the words “I’m stressed with vcat and think it’s in everyone’s best interest that I at least take a break from landsculpture” in his text message of 18 November 2015 meant that he wanted to have a break until these things were sorted out;



• he intended to return to work with the Respondent once the entitlements issues had been resolved;



• he made a choice not to work for the Respondent, despite working for other people, until the entitlements dispute was resolved;



• there was no unequivocal or clear or express statement that he had been dismissed in November 2015;



• on 3 December 2015 he realised that he had lost his job or thought that he had lost his job, though as a result of Mr Lomagno’s subsequent email which stated that he had not been sacked he thought he still had a job;



• he did not ring up and ask the Respondent for work because the entitlements issue needed to be resolved before he would return to work for the Respondent; and



• with regard to his letter of 9 February 2016 in which he requested details of his next job site/work day, while he would have liked to not to have returned until the entitlements matter was fully resolved he needed to work because he had a “wife and a house” 10.

The Respondent’s case

[22] The Respondent contended that Mr Zosel terminated his subcontract on 18 November 2015 by sending a text message to Mr Lomagno. The Respondent further submitted that Mr Zosel’s application had therefore been lodged approximately six months outside the statutory timeframe. The Respondent also submitted that Mr Zosel:

• could realistically have filed his application within the 21 day timeframe;



• had not demonstrated any exceptional circumstances warranting the Commission exercising its discretion to extend the timeframe for him to make his application; and



• the minimal reasons for the delay provided by Mr Zosel did not disclose the existence of exceptional circumstances.

[23] At the hearing, the Respondent submitted that the threshold question for the Commission was if there was a termination when it occurred. Relying on the decision in Mohazab v Dick Smith Electronics Pty Ltd (No 2) 11 (Mohazab), the Respondent submitted that an important feature of the legal test for termination is that the act of the employer results directly or consequentially in the termination of the employment and the employment relationship is not voluntarily left by the employee. Further, relying on the decision in Searle v Moly Mines Ltd12(Searle), the Respondent submitted that it was the facts which were relevant as opposed to the parties’ subjective beliefs. In summary, the Respondent submitted that Mr Zosel had not been dismissed and that it was unable to assist the Commission in respect of an appropriate date to fix as the date of termination, adding that Mr Zosel had left his employment. The Respondent also highlighted Mr Zosel’s oral evidence in which he attested that he withdrew his labour indefinitely pending resolution of his entitlements dispute. Finally, the Respondent contended that the word “break” should not be given any particular focus as a result of that.

[24] Among other things, Mr Lomagno deposed in his witness statement 13 that Mr Zosel terminated his subcontract on 18 November 2015 by sending him the previously mentioned text message. Key aspects of Mr Lomagno’s oral evidence were that:

• Mr Zosel first raised the issue of entitlements around late October/early November 2015;



• he had an arrangement with his workers whereby they could work on other jobs (i.e. not the Respondent’s jobs) and also use the Respondent’s equipment and workers on those jobs;



• Mr Zosel did not advise him how long the “break” was going to be;



• he had not asked Mr Zosel how long he intended to take a break for;



• the term “and part on good ways” reflected his understanding that Mr Zosel was going to do his own work;



• over the period 18 November 2015 to 9 February 2016 Mr Zosel had not contacted him seeking work;



• Mr Zosel had rejected an offer made in 2014 that he become an employee on the basis that the money was not enough;



• there was never any conversation with Mr Zosel after he took the break on 18 November 2015 where he said he did not wish to return to the Respondent;



• he had not said to Mr Zosel that he considered that he had resigned on 18 November 2015;



• he considered Mr Zosel’s text message of 18 November 2015 to be a resignation;



• the Respondent’s practice was that employees would return items such as tools and vehicles to the business when they were having a break without a date of return; and



• he understood the term “break” to mean a subcontractor going to do their own work.

The Statutory framework

[25] Section 386 of the Act deals with the meaning of dismissed and provides as follows:

“386 Meaning of dismissed

(1) A person has been dismissed if:

(a) the person’s employment with his or her employer has been terminated on the employer’s initiative; or
(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.

(2) …”

[26] Section 394 of the Act provides:

“394 Application for Unfair Dismissal Remedy

(1) A person who has been dismissed may apply to the FWC for an order under Division 4 granting a remedy.

(2) The application must be made:

(a) within 21 days after the dismissal took effect; or
(b) within such further period as the FWC allows under subsection (3).

(3) The FWC may allow a further period for the application to be made by a person under subsection (1) if the FWC is satisfied that there are exceptional circumstances, taking into account:

(a) the reason for the delay; and
(b) whether the first person became aware of the dismissal after it had taken effect; and
(c) any action taken by the person to dispute the dismissal; and
(d) prejudice to the employer (including prejudice caused by the delay); and
(e) the merits of the application; and
(f) fairness as between the person and other persons in a similar position.”

When did Mr Zosel cease working for the Respondent?

[27] In order to determine whether Mr Zosel’s application was made within the statutory timeframe specified in s.394(2) of the Act it is first necessary to determine when Mr Zosel ceased working for the Respondent.

[28] An analysis of the material before the Commission indicates that:

• on 18 November 2015 Mr Zosel sent Mr Lomagno a text message which stated among other things “I’m stressed with vcat and think it’s in everyone’s best interest I at least take a break from landsculpture”;



• Mr Zosel was performing paid work on a job in Hawthorn at the time he commenced his break;



• at no stage did Mr Zosel advise Mr Lomagno as to the length of the break;



• similarly, at no stage did Mr Lomagno ask Mr Zosel the likely duration of the break;



• on 3 December 2015 Mr Lomagno sent an email to Mr Zosel which stated, inter alia, “Let’s sort it out next week,and part ways on good terms,if that’s possible”;



• also on 3 December 2015 Mr Lomagno sent Mr Zosel an email stating that he had not been sacked;



• at no stage over the period 18 November 2015 to 9 February 2016 had Mr Zosel requested that he be provided with work and/or details of his next job site/work day, with Mr Zosel attesting that he did not ring up and ask for work because his entitlements issues needed to be resolved before he would return to work for the Respondent;



• the communication between Mr Zosel and Mr Lomagno over the period 18 November 2015 to 9 February 2016 focussed primarily on Mr Zosel’s entitlements issues;



• Mr Zosel first enquired about his employment status on 27 January 2016 when he emailed Mr Lomagno;



• the Respondent had not at any stage advised Mr Zosel that his employment had been terminated nor had Mr Zosel formally advised the Respondent that he was resigning;



• Mr Lomagno considered Mr Zosel’s text message of 18 November 2015 to be a resignation;



• Mr Zosel intended to return to work with the Respondent once his entitlements issues had been resolved, though he never advised the Respondent of his intentions in this regard; and



• the first time Mr Zosel could definitively say that his employment had been terminated was 16 February 2016.

[29] The issue of dismissed at the initiative of the employer was considered by the Full Court of the then Industrial Relations Court of Australia in Mohazab. The Full Court stated in its decision that:

“In these proceedings it is unnecessary and undesirable to endeavour to formulate an exhaustive description of what is termination at the initiative of the employer but plainly an important feature is that the act of the employer results directly or consequentially in the termination of the employment and the employment relationship is not voluntarily left by the employee. That is, had the employer not taken the action it did, the employee would have remained in the employment relationship. This issue was addressed by Wilcox CJ in APESMA v David Graphics Pty Ltd (unreported, Industrial Relations Court of Australia, 12 July 1995, Wilcox CJ). His Honour, at p 3, referred to the situation of an employee who resigned because ‘he felt he had no other option’. His Honour described those circumstances as:

‘. . . a termination of employment at the instance [of] the employer rather than of the employee.’

And at p 5:

‘I agree with the proposition that termination may involve more than one action. But I think it is necessary to ask oneself what was the critical action, or what were the critical actions, that constituted a termination of the employment.’” 14 (Underlining added)

[30] Drawing on the language in Mohazab, the above analysis of the material before the Commission does not indicate any act of the Respondent which resulted directly or consequentially in the termination of Mr Zosel’s employment. To the contrary, the material before the Commission points to Mr Zosel leaving the Respondent on 18 November 2015 for an unspecified period, pursuing his entitlements claim against the Respondent both directly and through the FWO, not requesting of the Respondent that he be provided with work and/or detail of his next job site/work day over the period 18 November 2015 to 9 February 2016 and not intending to work for the Respondent again until his entitlements issues were resolved. Again drawing on the language in Mohazab, the material before the Commission points to Mr Zosel voluntarily ceasing to work for the Respondent on 18 November 2015.

[31] As previously noted, Mr Zosel submitted among other things that in this case the term “break” meant an interruption to the continuation of work as opposed to a cessation of the employment relationship. However, an objective analysis of the material before the Commission (see paragraph [30] above) does not support Mr Zosel’s contention in this regard.

[32] Mr Zosel also submitted that the Respondent’s failure to give any assurance whatsoever as to his employment status was action which had the effect of bringing about a termination of his employment. Mr Zosel relied on the decision of Commissioner Smith, as he then was, in Sherwin v Adesse Pty Ltd 15 (Sherwin) in support of that contention. In Sherwin Commissioner Smith found that the respondent’s failure to offer work to the applicant, who was a casual employee, for a period of some six months amounted to a termination at the initiative of the employer. However, the facts in Sherwin are different from those in this case in that on 18 November 2015 Mr Zosel advised the Respondent that he thought it in everyone’s best interest if he “at least take a break from landsculpture” and it was not until almost three months later that he requested that he be provided work by the Respondent. In the context of this case, which includes Mr Zosel having a number of unresolved entitlements issues which in part appear to have lead him to take the abovementioned break, the Respondent’s failure to respond to Mr Zosel’s email of 9 February 2016 does not in my view constitute a termination at the initiative of the employer.

[33] Finally, I note that Mr Zosel did not argue that he was constructively dismissed.

[34] In summary, the material before the Commission does not point to Mr Zosel having been dismissed at the initiative of the employer, nor does it support a finding that Mr Zosel was dismissed as per s.386 of the Act. As such, Mr Zosel does not meet the requirement set out in s.394(1) of the Act. His application is therefore incompetent and must be dismissed.

Conclusion

[35] For all the above reasons, I have concluded that Mr Zosel was not dismissed as per s.386 of the Act and that, as such, he does not meet the requirement set out in s.394(1) of the Act. Mr Zosel’s application is therefore incompetent and must be dismissed. An order to that effect will be issued in conjunction with this decision.

Appearances:

G. Dirks for the Applicant.

J. Catlin of Counselfor the Respondent.

Hearing details:

2016:

Canberra and Melbourne (video hearing):

June 10.

 1   Exhibit 2 at Attachment RZ07

 2   Ibid at Attachment RZ09

 3   Ibid

 4   Ibid

 5   Ibid

 6   Exhibit 2 at paragraph 53

 7   Form F3 – Employer Response to Unfair Dismissal Claim at Item 2.2

 8   Ibid at Attachment RZ11

 9   Exhibit 2

 10   Transcript at PN749

 11 (1995) 62 IR 200

 12 (2008) 174 IR 21

 13   Exhibit 1

 14 (1995) 62 IR 200 at 205-206

 15   [2008] AIRC 900

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