Somerville v AFS Security 24/7 Pty Ltd
[2018] FCCA 964
•30 April 2018
FEDERAL CIRCUIT COURT OF AUSTRALIA
| SOMERVILLE v AFS SECURITY 24/7 PTY LTD & ORS | [2018] FCCA 964 |
| Catchwords: INDUSTRIAL LAW – Alleged dismissal in contravention of general protections in the Fair Work Act 2009 (Cth) – adverse action – whether employment was terminated because of complaint or inquiry made by the applicant – onus discharged by the respondents – no adverse action – application dismissed. |
| Legislation: Fair Work Act 2009 (Cth), ss.45, 340, 341, 342, 361, 389, 545, 546 |
| Cases cited: Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32; (2012) 248 CLR 500 Tattsbet Limited v Morrow [2015] FCAFC 62; (2015) 233 FCR 46 |
| Applicant: | MICHAEL STEWART NEIL SOMERVILLE |
| First Respondent: | AFS SECURITY 24/7 PTY LTD T/A ARMIDALE FIRE & SAFETY, AFS |
| Second Respondent: | BRIAN EVERETT |
| Third Respondent: | BROOKE EVERETT |
| File Number: | SYG 3141 of 2016 |
| Judgment of: | Judge Nicholls |
| Hearing date: | 20 July 2017 |
| Date of Last Submission: | 20 July 2017 |
| Delivered at: | Sydney |
| Delivered on: | 30 April 2018 |
REPRESENTATION
| Applicant: | In person |
| Solicitor for Respondents: | Mr M Dennis of Michael Dennis Solicitor |
ORDERS
The application made on 27 October 2016 is dismissed.
THE COURT NOTES THAT
The respondents made an application for costs at the handing down of judgment.
ORDERS
The respondents to file and serve an Application in a Case in relation to their application for costs on or before 14 May 2018.
The respondents to file and serve short written submissions in relation to their application for costs on or before 14 May 2018.
The applicant to file and serve any evidence by way of affidavit in reply on or before 28 May 2018.
The applicant to file and serve any short written submissions in reply on or before 28 May 2018.
THE COURT NOTES THAT
The parties are to advise the Court as to their preferred method of disposition of the respondents’ application for costs.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 3141 of 2016
| MICHAEL STEWART NEIL SOMERVILLE |
Applicant
And
| AFS SECURITY 24/7 PTY LTD T/AS ARMIDALE FIRE & SAFETY, AFS |
First Respondent
| BRIAN EVERETT |
Second Respondent
| BROOKE EVERETT |
Third Respondent
REASONS FOR JUDGMENT
This is an application made under the Fair Work Act 2009 (Cth) (“the FWA”), seeking relief pursuant to alleged contraventions of s.45 and s.340 of the FWA. The applicant, Mr Somerville, claims compensation pursuant to s.545 of the FWA in the amount of $19,863 comprising $4,363 in underpaid wages and $15,500 from lost income as a result of the termination of his employment by the first respondent (“AFS Security”). Mr Somerville also claims pecuniary penalties pursuant to s.546 of the FWA against the respondents.
Mr Somerville claims that adverse action (within the meaning of s.342 of the FWA), and relevantly, dismissal from employment, was taken against him in contravention of a general protection under the FWA. Mr Somerville’s claims are set out in the “Form 2” supporting his application to the Court which was filed on 27 October 2016.
Mr Somerville claims that he was employed by AFS Security under the Electrical, Electronic and Communications Contracting Award 2010 (“the Award”) from 8 February 2016 to 12 August 2016 as a “Fire Services Technician”. He asserts that during the course of his employment with AFS Security he was underpaid a total amount of $4,363. Further, when he inquired about this underpayment, his employment was “unilaterally terminated by [AFS Security] on 12 August 2016”, which was the “day after” he complained about the alleged underpayment.
Mr Somerville alleges that the second respondent, Mr Everett (director of AFS Security), said to him that a “restructure” was the reason behind his termination from his employment. Further, Mr Somerville alleges that AFS Security then hired a casual labourer to perform the duties that he would have been performing, had he not been dismissed. Mr Somerville then alleges that despite the requirements of the Award, the respondents did not consult with him, “or any other employee” regarding the consideration of “any form of organisational change, downsizing or restructure” regarding AFS Security.
In the circumstances, Mr Somerville alleges that his dismissal from employment “cannot be considered a genuine redundancy” and that the dismissal from employment, then stated to have taken place “[w]ithin 36 hours” of making the inquiry (note [3] above), was therefore an adverse action taken against him by AFS Security “in retaliation” for his complaint about underpayment and “numerous contraventions of the Award” (a “workplace right” within the meaning of s.341 of the FWA).
The Evidence before the Court
The evidence before the Court is as follows:
a)The affidavit of Michael Stewart Neil Somerville, unemployed, made on 30 December 2016. Mr Somerville was cross-examined on his affidavit. The objections to the affidavit and the disposition of those objections are contained in Schedule 1 to this judgment.
b)The affidavit of Brian David Everett, Director, made on 24 January 2017 with annexures. Mr Everett was cross-examined on his affidavit.
c)The affidavit of Brooke Rebecca Everett, Business Manager, made on 3 February 2017 with annexures. At the hearing it was noted that the reference to “Mrs” Somerville in the second sentence of [23] of the affidavit, should be a reference to “Mr” Somerville. Mrs Everett was cross-examined on her affidavit.
Before the Court
The matter was set down for final hearing on 20 July 2017. Pursuant to Court orders made on 1 December 2016, the applicant filed written submissions in this matter on 28 June 2017. The respondents filed written submissions on 6 July 2017.
At the hearing the applicant appeared in person. The respondents were represented by a solicitor.
Consideration
Before the Court, Mr Somerville explained the essence of his case as follows.
First, s.361 of the FWA “provides that an allegation of adverse action stands unless positively rebutted.” He asserted that the respondents have not provided evidence to the Court “rebutting” his allegations.
Second, s.340 of the FWA protected his “right” to make inquiries about, in context, the underpayment of his wages. Mr Somerville alleges that he was dismissed because he made a relevant inquiry. Further, Mr Somerville submits that the respondents have not “rebutted” the allegation that the termination of his employment was “in retaliation” for him “questioning” his alleged underpayment.
It is clear that s.361 of the FWA imposes an onus on the respondents to rebut any presumption raised by Mr Somerville as to the “reason” for the impugned conduct. The impugned conduct being the termination of Mr Somerville’s employment. As was said in Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32; (2012) 248 CLR 500 per French CJ and Crennan J (at [44] – [45]), the core question is “why” the adverse action was taken:
“[44] There is no warrant to be derived from the text of the relevant provisions of the Fair Work Act for treating the statutory expression ‘because’ in s 346, or the statutory presumption in s 361, as requiring only an objective enquiry into a defendant employer's reason, including any unconscious reason, for taking adverse action. The imposition of the statutory presumption in s 361, and the correlative onus on employers, naturally and ordinarily mean that direct evidence of a decision-maker as to state of mind, intent or purpose will bear upon the question of why adverse action was taken, although the central question remains ‘why was the adverse action taken?’.
[45] This question is one of fact, which must be answered in the light of all the facts established in the proceeding. Generally, 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. Direct evidence of the reason why a decision-maker took adverse action, which may include positive evidence that the action was not taken for a prohibited reason, may be unreliable because of other contradictory evidence given by the decision-maker or because other objective facts are proven which contradict the decision-maker’s evidence. However, direct testimony from the decision-maker which is accepted as reliable is capable of discharging the burden upon an employer even though an employee may be an officer or member of an industrial association and engage in industrial activity.”
However, in Tattsbet Limited v Morrow [2015] FCAFC 62; (2015) 233 FCR 46 (“Tattsbet”) Jessup J (with whom Allsop CJ and White J agreed), expressed the view that an applicant making an allegation that adverse action was taken because of a particular circumstance (as in the current case), must “establish the existence of the circumstance as an objective fact” (Tattsbet at [119] and see also Buchanan J in Construction, Forest, Mining and Energy Union v Anglo Coal (Dawson Services) Pty Ltd [2015] FCAFC 157; (2015) 238 FCR 273 at [76]).
In the current case, Mr Somerville has alleged that he was “dismissed” (from his employment with AFS Security) when he “[i]nquired about his underpayment” ([5] of Part G of Form 2). This is further explained as follows ([16] of Part G of Form 2) [I understand the reference to “Respondent” be a reference to AFS Security]:
“[w]ithin 36 hours of making the [i]nquiry and suggesting a discussion, the Applicant’s employment was terminated by the Respondent.”
I note that in the application, Mr Somerville also describes this “inquiry” as a “complaint”. However described (whether “inquiry” or “complaint”), an approach to his employer about the underpayment of his wages was an exercise of a “workplace right” (s.341(1)(c) of the FWA).
The difficulty for Mr Somerville in light of Tattsbet, is the state of the evidence before the Court concerning the “inquiry” or “complaint”.
Mr Somerville’s evidence is that there were a series of exchanges with, it would appear, the third respondent, Mrs Everett (Business Manager of AFS Security), about certain calculations concerning his pay as follows ([23] – [27] of Mr Somerville’s affidavit):
“[23] I reminded the Third Respondent that I had not had any response to my enquiry a week earlier regarding AFS not making any deposits against my Superannuation since the commencement of my employment 6 months prior. The Third Respondent moved the discussion on to other topics. I raised my view that simple communication from AFS to its employees could avoid misunderstandings and negative assumptions being made about pay discrepancies.
[24] I later received an email from the Third Respondent with a spreadsheet attached documenting claimed travel time vs paid travel time however, the information was incorrect. I responded with a corrected version based on my payslips that showed rather than me owing AFS 12 hours, AFS owed me 5 hours.
[25] Because of this exchange and earlier experiences around pays, I had concerns about calculations relating to all pays I had received from AFS and decided to take a closer look to put my mind at ease. I advised the Third Respondent of the employer’s legal obligations regarding deductions and pays, and raised concerns about AFS calculations of overtime and hours of work, asking for copies of all timesheets and overtime sheets.
[26] The Third Respondent’s response described a process to reduce my pay even further by misapplying provisions of the Award relating to Travel Allowances (I made enquiries of my workmates and found that this change to wage methodology, which was claimed by the Third Respondent to result from legal advice, was to apply to me only). I explained to the Third Respondent that this interpretation of this Award clause was selective and incomplete, and informed her of the subsequent and contextually relevant language in the Award, which specifically states that the proposed conditions do not apply to employees who commence work from the employer’s workyard.
[27] I identified to the Third Respondent that there appear to be several issues where AFS and I differ strongly in our interpretations and applications of the Award and the Act, and offered to discuss these or refer the matter to FWO for arbitration.”
I should note that the above paragraphs in Mr Somerville’s affidavit were the subject of objections by the respondents. In essence the objections went to form, particularly given the “truncated” nature of the presentation of this evidence. The respondents’ objection in part, was that this presented difficulties in their understanding the detail of the case against them.
Nonetheless, I admitted this evidence, and left it to the parties to make submissions as to what weight should be accorded to it. However, I should also note that [28] of Mr Somerville’s affidavit was not admitted into evidence. That paragraph referred to “this email” which was not made available to the Court. I agreed with the respondents’ solicitor that evidence of a document (“this email”), should have been given by production of the document.
I distinguished [28] of Mr Somerville’s affidavit from what was set out in the earlier paragraphs ([23] – [27] and acknowledging the difficulty as to form), on the basis that they contained evidence of what Mr Somerville says he told Mrs Everett, and what she replied.
In cross-examination, Mr Somerville gave evidence that the termination of his employment occurred on 12 August 2016. In the week prior to his termination he had email communications with Mrs Everett. In this communication, Mr Somerville raised the issue that his payment for “travel time” had been “incorrectly calculated”.
Mr Somerville’s evidence was that “eventually” after “several contacts”, “they” (in context, the respondents) accepted that there had been an “error”. This was explained through questioning, as being as a result of “three” email exchanges between Mr Somerville and Mrs Everett. [In context these were three emails from Mrs Everett in email exchanges which contained at least six emails]. Mr Somerville’s oral evidence corresponded with the evidence given in his affidavit, but only in relation to the “travel time”. His affidavit evidence also refers to other concerns about underpayments, including overtime and hours of work.
Importantly, it was Mr Somerville’s evidence that he was paid the amount of the “incorrect” calculation of his claimed travel time. That is, Mr Somerville did receive some payment, but this was based on an incorrect calculation.
Mr Somerville gave evidence that Mr Everett “personally” gave him the letter of termination on 12 August 2016. Mr Everett had been on leave in July. Mr Somerville had come into the workplace on his “rostered day off”. This was the second face-to-face contact Mr Somerville had had with Mr Everett since Mr Everett returned from leave.
In cross-examination, Mr Everett was asked a series of questions by Mr Somerville that appeared to go to the matter of whether Mr Somerville had been underpaid. These included the location of Mr Somerville’s workplace (Tamworth), and whether he was required to travel from Armidale to Tamworth (to reach his work location).
Further, Mr Everett was questioned as to whether he paid particular attention to Mr Somerville’s timesheets as a result of “discrepancies” in the timesheets, which had been brought to his attention, and related to staff at Tamworth. The evidence is that a “counselling session” took place on 26 February 2016 with the employees at Tamworth, including Mr Somerville.
Further questioning concerned the bases for certain calculations of various payments made to Mr Somerville, and what Mr Somerville had claimed prior to those payments being made.
Mr Everett gave evidence that while on leave with his wife, Mrs Everett (the third respondent), they discussed restructuring AFS Security as a result of the company’s financial performance and financial difficulties.
Mr Everett’s evidence under cross-examination, was that he did not speak with an accountant about the company’s financial difficulties. However, he did seek advice from the relevant Industry Association the National Electrical Contractors Association (“NECA”).
Mrs Everett was also cross-examined. However, in relation to the immediate issue before the Court, the relevant evidence is that Mrs Everett did discuss organisational change with Mr Everett while they were on leave in July 2016.
The questions Mr Somerville asked Mrs Everett about how she calculated pay entitlements, and what advice she sought from NECA, are not immediately relevant (see in particular, [35], [45] and [47] below).
In his submissions before the Court, Mr Somerville stressed the following.
One, that the various underpayments and deductions from his wages involved “thousands of dollars”.
The difficulty for Mr Somerville is that he has provided no documentary evidence of any of this. While his explanation appeared to be that there were “problems” in producing the relevant documents, the fact remains that they were not, for the large part, put into evidence before the Court.
In any event, the matter of documentary evidence supporting his claim of underpayment and deductions could only have been of importance if Mr Somerville had been successful in relation to his claim that his employment was terminated because he made a complaint or inquiry. For the reasons set out below, that is not made out on the evidence before the Court.
Two, Mr Somerville also submitted that Mrs Everett would be “expected” to give evidence in support of AFS Security, because of her spousal relationship with Mr Everett. That is, that Mrs Everett’s evidence should not to be accepted for that reason.
The respondents’ solicitor, correctly in my view, submitted that no suggestion was put in cross-examination to Mrs Everett that she was “tailoring” her evidence to support her husband and his company.
In any event, the immediate focus for the Court is whether Mr Somerville made a “complaint or inquiry” within the meaning of s.341(1)(c) of the FWA. If Mr Somerville made a relevant complaint or inquiry, the next issue is whether his employment was terminated because of the relevant complaint or inquiry.
Section 341(1) of the FWA is in the following terms:
“Section 341
Meaning of workplace right
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.”
There is no evidence before the Court that Mr Somerville made any relevant complaint or inquiry to any external body. However, I accept that pursuant to s.341(1)(c)(ii) a complaint or inquiry for the purposes of that section, can be made to the employer (Harrison v In Control Pty Ltd [2013] FMCA 149; (2013) 273 FLR 190, Hodkinson v The Commonwealth [2011] FMCA 171; (2011) 248 FLR 409 and Devonshire v Magellan Powertronics Pty Ltd & Ors [2013] FMCA 207; (2013) 275 FLR 273).
The state of the evidence before the Court is not clear as to the details of Mr Somerville’s complaint or inquiry. However, what is clear is that on the evidence that is before the Court, Mr Somerville did approach his employer (the first respondent, AFS Security) about various calculations of his pay, claimed underpayments and deductions of his wages.
I find that Mr Somerville was, at the relevant time, an employee of the AFS Security and notwithstanding the lack of detail, he did make a complaint or inquiry to his employer (Mrs Everett was the “Business Manager” of AFS Security), in relation to his employment within the meaning of s.341 of the FWA.
The issue then becomes whether the respondents have discharged the onus imposed by s.361 of the FWA, to show that the termination of Mr Somerville’s employment was not for reason of (“because of”) his complaint or inquiry.
I am satisfied on the evidence that the reason for the termination was the restructure of AFS Security.
First, it is of importance that the respondents did acknowledge, when approached by Mr Somerville, that there had been some error in the initial calculations made by Mrs Everett in relation to payments for some “travel time” (see [21] – [23] of Mrs Everett’s affidavit and relevant annexures “C” and “D”).
Mr Somerville’s argument was that this acknowledgement and payment, only occurred after a series of communications, rather than immediately. Although unclear, it appeared that the inference he wanted the Court to draw, was that there was some reluctance on the part of the respondents to address this matter.
If that was the intent of Mr Somerville’s submission, then on the evidence, I do not accept it. Mrs Everett’s evidence was that once the incorrect calculation was pointed out to her, she agreed, and Mr Somerville was paid the “additional hours” to which he was entitled. There is nothing before the Court to say Mrs Everett’s evidence should not be accepted in this regard.
While this factor is not of itself determinative, it is strong evidence that there was a willingness to look objectively at the complaint or inquiry made by Mr Somerville. The inference to be reasonably drawn was that the respondents were not aggrieved by the complaint, such that it led to the termination of Mr Somerville’s employment.
Second, Mr Everett gave evidence that the decision to terminate Mr Somerville’s employment was taken by him. On the evidence, he was the sole director of AFS Security. While Mrs Everett was the “Business Manager”, Mr Everett alone made the decision to terminate Mr Somerville’s employment ([47] of Mr Everett’s affidavit). Again, Mr Everett was not challenged on this in cross-examination. I accept his evidence in this regard.
Third, both Mr Everett and Mrs Everett (in corroboration) gave evidence that their concerns about AFS Security’s financial position arose in July 2016. That is, before Mr Somerville sent his first email communication containing the initial complaint or inquiry.
Again, the difficulty for Mr Somerville is that neither Mr Everett nor Mrs Everett, was effectively challenged in cross-examination on this evidence. During his cross-examination of Mr and Mrs Everett, Mr Somerville directed some questions to whether Mr and Mrs Everett had sought external advice concerning the restructure of AFS Security. If anything, on its face, their answers that they did seek such advice, supports their contention now that the termination of Mr Somerville’s employment was as a result of the restructure.
In any event, what remains is the evidence that the two persons responsible (in different ways) for the management and running of AFS Security, had financial concerns which led to the need to restructure AFS Security. On the evidence, these concerns about the company arose before the complaint or inquiry was made by Mr Somerville.
While there was some evidence that there had been the need to “counsel” employees at the Tamworth site, including Mr Somerville, there is nothing to show that at the time of that “counselling session” (February 2016), a complaint or inquiry had been made by Mr Somerville. Nor has Mr Somerville pointed to any evidence to link the events of February 2016 to the decision by AFS Security to terminate his employment.
Fourth, Mr Everett’s evidence was that at the same time as the termination of Mr Somerville’s employment, a number of other employees’ employment was also terminated and/or they left their employment and were not replaced (see [19] – [20] of Mr Everett’s affidavit). Mr Somerville did not challenge this evidence. When asked in cross-examination, Mr Everett also gave evidence that another employee’s (Mr Bagnell’s) employment was terminated for disciplinary reasons.
In all therefore, I find that Mr Somerville’s employment was terminated by a decision made by Mr Everett in collaboration with Mrs Everett, for reason of the restructure of AFS Security following concerns about its financial situation, and not for reason of Mr Somerville’s complaint or inquiry. That is sufficient to dispose of the application to the Court.
I should also note that in some of his questioning of Mr Everett, Mr Somerville sought to refer to the procedures involved in his dismissal from employment.
Mr Somerville is unrepresented before the Court. For that reason, some latitude was given to him. Mr Somerville was given “leeway” in his cross-examination of both Mr and Mrs Everett.
However, the claim made by Mr Somerville was a claim alleging dismissal in breach of a general protection (Part 3-1 of the FWA). There is nothing in his application to the Court alleging a breach of s.389 of the FWA, which deals with whether a redundancy is genuine in the context of an unfair dismiss. The state of Mr Somerville’s application to the Court, and what the respondents could reasonably be held to have to answer, was that there was a breach of a workplace right pursuant to s.340 of the FWA. If Mr Somerville wanted to pursue an unfair dismissal claim, he made no application to the Court to amend his application for that purpose.
Conclusion
In all, it is appropriate to make the order sought by the respondents that the application be dismissed. I will make that order.
I certify that the preceding fifty-nine (59) paragraphs are a true copy of the reasons for judgment of Judge Nicholls
Date: 30 April 2018
Schedule 1
| Item | Reference | Objection | Disposition |
| 1 | [3] “…who had recently completed his Apprenticeship but was unlicensed and inexperienced as an electrician” | Relevance Conclusion Opinion | Applicant not pressing the words “inexperienced as an electrician”. Objection overruled, evidence allowed. |
| 2 | [6] | Conclusion, no evidence for the basis of conclusion | Objection upheld, evidence not allowed. |
| 3 | [7] The second sentence and the remainder of the paragraph | Hearsay | Objection not pressed by respondents. Evidence allowed (on basis that it shows this is what the applicant was told). |
| 4 | [9] last sentence | Opinion | Objection upheld, evidence not allowed. |
| 5 | [11] | Opinion | First three words of paragraph not pressed by applicant. Objection upheld, evidence not allowed. |
| 6 | [14] | Hearsay | Objection overruled, evidence allowed (on basis that it shows this is what applicant was told). |
| 7 | [16] | Hearsay | Objection not pressed by respondents. Evidence allowed (on same basis as immediately above). |
| 8 | [21] that part of the last sentence beginning with the words “and I assumed” | Relevance, the assumptions of the witness are not relevant | Objection upheld, evidence not allowed. |
| 9 | [23] | Conclusion, no evidence of the actual communication between the Third Respondent and the Applicant | Respondents conceded objection as it is an objection as to form. Evidence allowed. |
| 10 | [25] | Conclusion, no evidence of the actual communication between the third respondent and the applicant | As above. Evidence allowed. |
| 11 | [26] | Conclusion, no evidence of the actual communication between the Third Respondent and the Applicant | As above. Evidence allowed. |
| 12 | [27] | Conclusion, no evidence of the actual communication between the Third Respondent and the Applicant | As above. Evidence allowed. |
| 13 | [28] | Evidence of a document should be given by production of the document | Objection upheld, evidence not allowed. |
| 14 | [30] the part of the paragraph beginning with the words “however the Second Respondent” [in context, to the end of the paragraph] | Argumentative | Evidence not pressed by applicant. Evidence not allowed. |
| 15 | [32] second sentence | Submission not evidence | Objection upheld, evidence not allowed. |