Somkamol Hasawang v Agents Support Services Pty Ltd

[2014] FWC 1919

[2014] FWC 1919 [Note: An appeal pursuant to s.604 (C2014/779) was lodged against this decision - refer to Full Bench decision dated 20 jULY 2014 [[2014] FWCFB 5059] for result of appeal.]

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Somkamol Hasawang
v
Agents Support Services Pty Ltd
(U2013/7250)

COMMISSIONER MCKENNA SYDNEY, 23 APRIL 2014

Application for relief from unfair dismissal.

[1] Somkamol Hasawang (“the applicant”) has lodged an application pursuant to s.394 of the Fair Work Act 2009 (“the Act”) seeking an unfair dismissal remedy. The application specified the name of the respondent employer as “Agents Support Services Pty Ltd (Previously Agents Support Systems Pty Ltd) T/A e-Travel Blackboard”. I should begin at the outset by noting that Agents Support Services Pty Ltd was not “previously” Agents Support Systems Pty Ltd; they are separate entities and there was nothing arising in the case to suggest they were associated in any way at the time relevant to this application.

[2] Agents Support Services Pty Ltd (“the respondent”) initially objected to the application principally on the basis the applicant was not, and never had been, one of its employees. In an earlier decision (Somkamol Hasawang v Agents Support Services Pty Ltd (Previously Agents Support Systems Pty Ltd) trading as e-Travel Blackboard[2013] FWC 4419, the objection was dismissed. The decision of Drake SDP dismissing respondent’s objection read in part:

“[4] In correspondence dated 23 May 2013 a Mrs Norma Santoro from the respondent also provided the following response:

‘We refer to the recent request from the Fair Work Commission regarding an applicant Somkamol Hasawang, a Thai National, residing in the Kingdom of Thailand and who is not an employee of Agents Support Services Pty Ltd.

Agents Support Services Pty Ltd is a small company with five-fulltime (sic) employees all resident in Sydney.

In fact, Somkamol Hasawang has targeted the company's customers in Thailand insinuating that the company is not financially stable and she could move them to a competing business, which currently operates in Thailand without proper documentation and permits. Furthermore, is the slander and defamation levied at the Director and Manager of the company by way of using social media outlets such as Facebook, Twitter and Linkedin.

The company is gravely concerned as to why they are in need of defending such accusations levied by Somkamol Hasawang when there is no contract or work place agreement in place; the applicant has been and continues to work for a competing entity in Thailand.

We trust this matter can now be put to rest as being a small business we lack both resources and expertise in dealing with such matters.

We thank you for your assistance and understanding in this matter.’ [emphasis in original decision]

[5] Ms Hasawang provided an extensive and detailed submission with attachments on 24 May 2013. She also provided this to the respondent.

[6] On 29 May 2013 I wrote to the respondent requesting that it provide some evidentiary basis for its objection. I received no response. On 14 June 2013 I again wrote to the respondent advising that if it did not respond to my earlier correspondence and provide some evidence as to the matters it relies upon for its jurisdictional objection, that the objection may be dismissed.

[7] On 19 June 2013 the respondent did not provide any evidence as to its assertions as requested but replied as follows:

“The applicant is not our employee.

We only have a staff of four full-time employees and two casuals who are all resident in our Sydney office.

There is no agreement between our company and the applicant and we do not know what else we can do to resolve this matter. The jurisdictional objection is as we have no staff in Thailand and furthermore the applicant is not one of our staff.

Can we view evidence as to why this person believes they are our employee please?”

[8] The respondent did not address Ms Hasawang’s submissions or attachments. It asked for evidence without acknowledging the prior receipt of that evidence from Ms Hasawang.

[9] On 4 July 2013 I wrote to both parties and advised that I intended to deal with the application on the papers already provided, but that I would consider any further material they wished to put before me up until, but not after, close of business on Thursday, 11 July 2013. No material has been provided to date.

[10] The jurisdictional objection of the respondent is dismissed. This application is referred for allocation for a date for arbitration.”

[3] There was no appeal against that decision dismissing the respondent’s jurisdictional objection - albeit in submissions following the decision of Drake SDP the respondent nonetheless maintained or reiterated its primary position that the applicant had never been its employee. The matter was then allocated to me for hearing last year against the background of the decision dismissing the respondent’s jurisdictional objection.

[4] Upon reading the file, there appeared to me to be potential, preliminary jurisdictional issues that had not otherwise been addressed in the respondent’s initial response to the application. In consequence, I determined to vacate the initial listing and caused correspondence to be forwarded to the parties. After having written to the parties flagging a potential jurisdictional issue, the applicant confirmed that she wished to proceed with the application and outlined a short submission in that regard. The file was returned to the Unfair Dismissal Case Management Team for further central programming and listing, although subsequently the file was then reallocated directly to me earlier this year.

[5] Consequent upon the further reallocation of the matter to me, I again caused correspondence to be sent to the parties which, among other matters, sought their views as to how to progress the matter in circumstances where the applicant resides in Thailand. The parties each subsequently confirmed they agreed to the application being determined on the basis of the materials already lodged and they indicated they did not propose to seek to lodge any further materials. On 17 March 2013, I caused further correspondence to be sent to the parties advising that, with their consent, I would determine the application on the materials already lodged.

Background to the application

[6] The applicant is a Thai national who resides in that country. In 2008, the applicant entered an employment contract (“the 2008 contract”) with an Australian company, namely Agents Support Systems Pty Ltd (“the first company”), to work as a Thailand-based Business Development Manager. The applicant’s role in her employment with the first company involving work in relation to a travel-industry electronic newsletter named “e-Travel Blackboard”.

[7] Although the first company was Sydney-based, it is unclear whether the 2008 contract itself was intended to be subject to Australian law. The 2008 contract did not indicate as such and the contract otherwise, for example, specified some matters which would be in disconformity with Australian employment laws such as annual leave of only ten days a year.

[8] It appears that in 2012 the first company encountered some form of financial difficulties. In this regard, SV Partners, insolvency accountants, subsequently prepared a report indicating they had been in contact with the first company since 24 October 2012. The first company did not remunerate the applicant on time, or at all, for a period of time (relevantly) to 15 November 2012 when the respondent acquired, apparently through sale by the first company and purchase by the respondent, the first company’s client data base and domain names. The respondent did not “take over” the first company on that date of the acquisition of the data base and domain names, or thereafter (and the liquidation of the first company subsequently commenced around July 2013). The respondent’s materials otherwise indicated the first company and itself were not related entities either by shareholding or directorships.

[9] The respondent’s materials further indicated that it endeavoured to re-employ as many of the previous staff of the first company as financially possible while rebuilding business “from scratch”. The respondent did not enter into any form of a signed employment contract with the applicant and nor (in contrast with some of the other Sydney-based employees of the first company) did the respondent offer to re-employ her. Nonetheless, some type of relationship, the basis of which is unclear, ensued between the applicant and the respondent most likely from after 17 December 2012 when the applicant received an email (but possibly from an earlier date of 15 November 2013 when the respondent acquired the first company’s client data base and domain names) to the date the respondent sent an email to the applicant on 14 February 2013.

[10] By way of elaboration, the applicant first learned on 17 December 2012 about the corporate changes involving the respondent in an email from Anthony Valeriano, who had worked with the first company and who was by then apparently working in the employ of the respondent. The applicant said no further information was provided to her regarding other changes and no new contract was offered or mentioned from that date onwards, with the result she personally concluded the conditions in her 2008 contract with the first company would remain intact with the respondent.

[11] While there was no formal offer and acceptance of employment, or signing of a new employment contract between the applicant and the respondent, there appears to have been employment-like dealings between the applicant and the respondent, albeit they were somewhat amorphous. For example, the staff of the respondent who had exchanged emailed communications with the applicant seemed personally uncertain as to the status of matters, such as payments being claimed by the applicant and seemingly lacking in clear direction or authority from the directors of the respondent.

[12] The applicant’s materials indicated that when she asked Mr Valeriano on 2 January 2013 about salary, commission and reimbursement of expenses, he asked her to wait for approval from the new management although his email otherwise effectively contested liability of the respondent for any payments prior to 15 November 2012.

[13] A large number of emails and documents were lodged by the applicant all of which I have considered, but do not describe in this decision (for example, some of the documents referred to quite old issues between the applicant and the first company about matters such as payment made in the context of currency exchange rates). The various email exchanges between the applicant and staff of the respondent from 17 December 2012 were, however, suggestive of an employment relationship between the applicant and the respondent, particularly as they concerned matters in relation to the applicant’s communications seeking payment and advice from staff of the respondent that payment would be arranged for a certain period of time, and other matters such as providing the respondent’s new letterhead to the applicant and advice that “everyone is still employed at the moment”.

[14] The respondent informed the applicant it did not consider itself liable for claims concerning the period preceding 15 November 2012, that is, in relation to her employment with the first company. On 1 February 2013, the applicant received an email from (or relayed via) Mr Valeriano identified as being from the “Representative Officer of Agents Support Systems Pty Ltd” which read, in part:

“We have on record that Agents Support Systems Pty Ltd owes you the sum of $4,099.92.

As the company is no longer in operation, the owner has agreed to pay 10 cents in the dollar.

We advise you to accept an ex gratia payment of $409.99 in full as the entitled settlement of the debt owing to you.

To receive payment within 7 days, please acknowledge and confirm via email your acceptance of this payment.

Kind Regards

Representative Officer of Agents Support Systems Pty Ltd”

[15] On 6 and 7 February 2013, the applicant sent an email to Mr Valeriano relevantly refusing the payment concerning the settlement offer of the first company concerning payments.

[16] On 13 February 2013, the respondent learned the applicant had reportedly contacted a client hotel in Thailand to advise that e-Travel Blackboard was insolvent, that the client may not get all advertising as paid, and offering to move the client across to another, competitor publication. Documentation concerning contemporaneous telephone records and an email to the client were attached to the respondent’s submissions.

[17] On 13 February 2013, Jonathon Harris, a member of the respondent’s board of directors, telephoned the applicant. The applicant’s materials described how “after breaking the ice, I decided to record the conversation” (without the knowledge or consent of Mr Harris). The applicant attached to her materials a form of transcription of the conversation.

[18] The respondent’s case, albeit only in submissions, put that Mr Harris had telephoned the applicant to explore any opportunities to work with her in the future and involve her with the respondent’s plans of the future. However, the submissions continued that Mr Harris found the applicant to be “abusive and aggressive towards him unnecessarily”; demanding about issues which were of no concern to the respondent and which related to the first company; and unable to provide any form of documentation relating to employment contracts or sales plans, reports or activities. The respondent was also concerned, albeit it is not clear whether this was canvassed in the telephone conversation between Mr Harris and the applicant, that the client hotel had been contacted by the applicant in a way the respondent’s submissions characterised as all being “in breach of any normal contractual obligations should they be in place and deemed most unethical, vexatious or slanderous”.

[19] The respondent’s submissions continued that upon discussing the behaviour of the applicant, the then Acting General Manager/management team thought it best in order to protect the respondent and its employees to send the email of 14 February 2013 to the applicant, as she refused to acknowledge and understand that the respondent was not involved with the company she had worked for previously.

[20] The termination of the relationship - however that relationship may best be described - between the applicant and the respondent occurred on 14 February 2013, when the respondent’s Acting General Manager sent an email which read, in part:

“Unfortunately with the new ownership and management structure of Agents Support we have no alternative but to terminate your involvement with our business with immediate effect.

As previously discussed with you on numerous occasions by both Anthony and Norma, any related historical financial disputes should be taken up with [the owner of Agents Support Systems Pty Ltd] Peter Reilly.”

We thank you for your contribution and wish you well in your future endeavours.”

[21] The applicant considers that the reason for the email of 14 February 2013 was based solely on her earlier refusal to accept a settlement offer from the first company of 10 cents in the dollar for salary and commission owed to her by the former company (being an offer which had been relayed to the applicant by or via Mr Valeriano. It may also be noted that following the email of 14 February 2013, the respondent forwarded correspondence to numerous clients, the effect of which was to advise the applicant was no longer employed by the respondent.

Consideration

[22] It is unclear to me that any employment or quasi-employment relationship between the applicant and the respondent as at 14 February 2013 was an employment relationship of a type that would have entitled the applicant to seek an application for an unfair dismissal remedy under s.394 of the Act. But if the relationship between the applicant and the respondent was one which was subject to the Act, it seems to me the application could not otherwise succeed.

[23] I have considered the submissions of the applicant as to the minimum employment period. The applicant submitted she first learned about the respondent on 17 December 2012; she understood from the email the arrangements involved only a name-change of the first company - and, absent any further information, concluded for herself that the conditions in her 2008 contract with the first company would remain and she would be paid accordingly. It is not clear to me that the 2008 employment contract was effectively transmitted to the respondent in the manner the applicant considered to be the case, and I tend to the view it was not. The applicant also submitted the respondent had never advised her that her period of service with the first company would not be recognised as continuous service. The applicant further submitted there was a transfer of assets from the first company to the respondent, no period of closure, and all staff continued to work for the respondent using the same office, clients and resources. She added that all contracts of the first company continued to be filled by the respondent and her role as Business Development Manager remained unchanged after 15 November 2012. However, it may be noted that the applicant’s understanding was mistaken about certain matters, including the nature of the transactions concerning the acquisition of the first company’s client data base and domain names, although any such mistake appears to have emanated solely or principally from advice that was relayed to her by staff of the respondent on and from 17 December 2013 suggesting nothing more was involved than a name-change of the first company.

[24] It is unclear the date upon which the applicant’s employment relationship with the first company actually terminated. It also is unclear when the respondent was then said to have commenced employing the applicant (albeit I accept there were some indications that there may have been some assumptions underlying both parties’ emails that there was work to be performed for reward) with the applicant’s submissions seeming to proceed on the basis the employment with the respondent commenced on either 15 November 2012 (when the respondent acquired the client data base and domain names from the first company) or on 17 December 2012 (when she received Mr Valeriano’s email about the respondent).

[25] Notwithstanding some of the unusual aspects of the case, I would not conclude on the admittedly somewhat sketchy information lodged by both parties that what was involved here was - such as may otherwise have preserved the applicant’s continuity of service - a transfer of employment (see each of the relevant criteria in s.22 of the Act) or a transfer of business (see each of the relevant criteria in s.311 of the Act and discussion in cases such as Zabrdac v Transclean Facilities Pty Ltd[2011] FWA 4492 from [74] and John Lucas Hotel Management Services T/A World Square Pub v Hillie[2013] FWCFB 1198 from [18]); and, in this regard, the question of whether the applicant was a person protected from unfair dismissal then arises (see ss.382-384 of the Act).

[26] The applicant is of the view she meets the minimum employment period because of her employment period with the first company as well as the respondent, but (accepting that the earlier decision dismissed the respondent’s objection that the applicant was not its employee), I would not conclude the minimum employment period requirement has been met concerning the applicant’s employment or quasi-employment with the respondent given my earlier conclusions concerning continuity and the date of 14 February 2013 relied upon as the date of dismissal.

[27] Even if it were not for these potential jurisdictional issues and if the email of 14 February 2013 in fact constituted advice of summary dismissal concerning employment with the respondent (rather than, for example, advice to terminate the applicant’s “involvement with our business”, which, as I have indicated earlier, was a somewhat amorphous involvement), then I note the respondent is a small business and the Small Business Fair Dismissal Code arises for consideration. The Code provides it is fair for an employer to dismiss an employee without notice or warning when the employer believes on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal.

[28] It seems to me the dismissal may be viewed as Code-compliant, considering the circumstances described in the materials. That is, the respondent learned on 13 February 2013 the applicant had reportedly contacted a client hotel advising that e-Travel Blackboard was insolvent, that the client may not receive all the advertising credits the hotel had paid for, and offering to move the client across to a rival publication. That is, as a result of that contact from a client, one of the respondent’s employees wrote thanking the client for the call, advising that he should contact himself concerning any future dealings concerning advertising on e-Travel Blackboard - and also informing the client to rest assured as it was business as usual. The timing of the telephone contact from the client and the nature of the emailed response from the respondent plausibly explains why the respondent took the action it did, against the background of a belief on reasonable grounds about the applicant’s contact with the client. Once again proceeding on the basis there was an employment relationship or quasi-employment relationship and the email of 14 February 2013 constituted a dismissal from employment, then what the respondent had learned from the client (and which is not otherwise disputed in any of the applicant’s materials, albeit she has subsequently otherwise indicated she was not given natural justice to respond to such matters) grounded a basis for summary dismissal.

[29] Following from the approach in John Pinawin T/A RoseVi.Hair.Face.Body v Edwin Domingo[2012] FWAFB 1359, the termination of the applicant’s employment was consistent with the Code and the termination thereby was not an unfair dismissal. As such, it is unnecessary to consider the other elements as to an unfair dismissal. Given my conclusion in this respect, it is also unnecessary to consider the alternative grounds relied upon in the respondent’s submissions as the basis for sending the email of 14 February 2013.

[30] I am not satisfied, once again proceeding on the basis of the dismissal of the respondent’s objection that the applicant was not its employee, that any such termination of the applicant’s employment on 14 February 2013 resulted from the applicant’s refusal to accept an offer of 10 cents in the dollar from (or via) Mr Valeriano concerning the offer by the first company and which was identified as being from the “Representative Officer of Agents Support Systems Pty Ltd”.

[31] In this regard, I note that the clear and abiding theme of the documents lodged by the applicant has been a claim for payment of money in the nature of alleged underpayments. For example, an email with the documents initially lodged with the Form F2 application form seeking an unfair dismissal remedy advised as follows:

“The dismissal (see attached copy) dated 14 February, 2013 was issued to me by email (see copy attached), without notice or prior consultation and without payment for:

1. SALARY (please refer to Salary Default.doc)

2. EXPENSES (Please refer to Unpaid Reimbursement October 2012-February 2013.doc)

3. COMMISSIONS DUE (please refer to sales generating August 2012 - February 2013.doc)

4. VACATION DUE 30 days (10 days per year of service as per stated in contract enclosed: Contract June 2008 and Termination February 2013.doc)

5. PAYMENT IN LIEU OF NOTICE (please refer to Contract June 2008 and Termination February 2013.doc)

I was informed that the company has been re-structured and/or liquidated. An offer of “10 cents on each dollar due” was made for the month of October to November 14, 2012 ONLY, which does not take into consideration any other monies owed (as detailed above). I refused this offer.

You will notice that whilst I am not an Australian citizen or resident, I was employed by Agents Support Services Pty Ltd (formerly Agents Support Systems Pty Ltd) as their representative for Thailand and I therefore believe that the company is responsible for all provisions regarding employment as are applicable to Australian citizens and residents.

...

I would be most appreciative of your assistance in ensuring that I am paid all monies owed to me, as outlined above, plus those expenses that I have incurred related to this matter. ...”

[32] In later emailed correspondence to the Commission on 29 November 2013, the applicant similarly wrote:

“However, to date, I have never been paid any entitlements (e.g. wages, commission, work expenses or holiday pay) owed to me by the previous company.

In fact the non payment of my entitlements had been the main grievance which I had with the new company, as to who was responsible for those entitlements. As you may be aware from my submission I was told that the old company was responsible and I was made an offer of 10 cents in dollar [sic] for those entitlements. However, the basis for that offer was never satisfactorily resolved, as outlined in my submission, and I refused the offer. I believe this refusal ultimately led to my employment being terminated.”

[33] As a post-script, on 23 February 2013, that is following the email of 14 February 2013, the applicant sent an immoderately-worded email to Peter Reilly, a director or owner of the first company and to Mr Harris of the respondent in seeking payments of certain amounts of money. Mr Reilly responded with advice including that there were insufficient funds to pay creditors; that a named director had no money; that other employees and creditors had been offered 10 cents in the dollar in full settlement; that the offer had been accepted by most other employees, and the offer was from him personally; that the first company will not be in a position to pay anything; and seeking that the applicant reconsider the offer.

[34] Lastly, and in this regard, it cannot go unremarked that in the time relevantly under consideration the applicant was in a difficult position indeed. The first company owed money to her which was not paid, although the first company did make a settlement proposal which the applicant rejected as unacceptable (and the first company has since been liquidated with the result the applicant will receive no payment from that company). From around, perhaps, mid-November or more likely mid-December 2012, the applicant, under some form of ad hoc employment-like arrangements that were never formalised with the respondent, undertook at least some work for the respondent expecting - not unreasonably given an examination of the various documents as to what transpired in the time to 14 February 2013 - that she had seamlessly continued to be employed by the respondent under her 2008 contract of employment made with the first company.

[35] In having apparently separately undertaken some ongoing work for the respondent from the time after she received the email of 17 December 2012, it appears the applicant then received no payments from the respondent itself in the time to the email of 14 February 2013, even though representations were made to her indicating or suggesting payment would be made by the respondent with respect to the period from after about 15 November 2012. In all, the applicant performed work from about August 2012 to February 2013, thinking that all that was involved was a change of company name, without payment from either the first company or the respondent in connection with work concerning e-Travel Blackboard. The background of these matters would seem to explain the tenor of the content of her conversation with Mr Harris on 13 February 2013.

Conclusion

[36] An order dismissing the applicant’s application for an unfair dismissal remedy has been issued in conjunction with this decision.

COMMISSIONER

Hearing details:

On the papers

Final written submissions:

17 March 2014

Printed by authority of the Commonwealth Government Printer

<Price code C, PR548867>