Te Ahi Kaa Roa Maxwell v Alcoa of Australia Limited

[2020] FWC 962

[2020] FWC 962

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Te Ahi Kaa Roa Maxwell
v
Alcoa of Australia Limited
(U2019/10626)

COMMISSIONER WILLIAMS PERTH, 26 FEBRUARY 2020

Application for an unfair dismissal remedy.

[1] This decision concerns an application made by Te Ahi Kaa Roa Maxwell (Mr Maxwell or the Applicant) for an unfair remedy under section 394 of the Fair Work Act 2009 (Cth) (the Act). The respondent is Alcoa of Australia Limited (Alcoa or the Respondent).

[2] Alcoa have raised a jurisdictional objection that in their view Mr Maxwell has not completed the minimum employment period of six months which s.382 of the Act requires to be completed, in order to be protected from unfair dismissal.

[3] Consequently, the Commission issued directions to the parties to respectively file witness statements and submissions which have now been provided to the Commission.

[4] This decision deals only with the jurisdictional objection.

Agreed Facts

[5] The parties agreed facts are as follows.

[6] The Applicant was directly employed by Chandler Macleod by way of a written contract sent to the Applicant by email on 6 November 2018.

[7] The employment arrangement provided that the Applicant would:

(a) be employed as a “Trade Assistant”.

(b) start on 12 November 2019.

(c) work at ‘Del Park’.

[8] Chandler McLeod also in its offer to the Applicant wrote:

“We anticipate your assignment may last until 30 July 2019 However, this date is indicative only as we are unable to control the length of any assignment and cannot guarantee the length of the assignment.”

[9] The Applicant commenced employment with Chandler Macleod on 12 November 2018.

[10] Chandler MacLeod recruited the Applicant for the purposes of supplying the Applicant to the Respondent at the Respondent’s Del Park mine site.

[11] The Applicant worked for Chandler Macleod on an ongoing basis between 12 November 2018 and 28 July 2019.

[12] The Applicant did not work for Chandler Macleod for the period between 8 July 2019 and 14 July 2019.

[13] In April 2019, the Applicant participated in a merit based ‘Talent Pool’ recruitment process undertaken by the Respondent to identify personnel who may be suitable for selection and appointment to vacant positions being filled by the Respondent.

[14] On 11 July 2019, the Respondent offered the Applicant employment.

[15] The Applicant commenced employment with the Respondent on 29 July 2019.

[16] The Respondent terminated the employment of the Applicant on 11 September 2019 and communicated that decision to the Applicant on that day.

Further Factual Findings

[17] The evidence of Mr Glen Miles (Mr Miles), the Supervisor of the Fixed Plant Maintenance Department at the Huntly bauxite mine operated by Alcoa, is that during the time Mr Maxwell was employed by Chandler Macleod and provided to Alcoa under the labour hire arrangement, he was backfilling for a range of forecasted absences.

[18] The backfilling was of Alcoa employees who were absent on extended periods of approved leave. This included Mr Maxwell backfilling for a Mr Oates who at the time was acting in the Fixed Plant Trainer position, which was vacant due to another Alcoa employee’s retirement. He also backfilled for a Mr Davidson who was absent on approved long service leave. Mr Maxwell also backfilled for a Mr Flatt who was absent on approved annual leave.

[19] Mr Miles evidence was that after successfully undergoing Alcoa's direct recruitment process Mr Maxwell filled a role left vacant by the departure of another Alcoa employee Mr Every. His evidence was the role that Mr Maxwell worked in after commencing employment with Alcoa was different to the role he worked in whilst he was working with Alcoa under the labour hire arrangement with Chandler Macleod.

[20] Mr Nick Bacon’s (Mr Bacon) evidence relevantly was that Alcoa's Huntly mine directly employs approximately 550 people and currently sources approximately 100 persons through labour hire providers.

[21] Alcoa's Huntly mine site typically utilises additional labour supplied by labour hire providers for coverage of planned and unplanned leave; peak workloads; work of a short duration; and work that may cease in the foreseeable future.

[22] Mr Bacon’s evidence was that work performed by labour hire personnel is not outsourced work.

[23] The extent to which Alcoa sources external supplemental labour fluctuates throughout the year based on operational requirements.

[24] Alcoa sources labour hire personnel from a range of labour hire providers, including Chandler Macleod; Hays; and/or Zoom Recruitment.

[25] In the case of Chandler Macleod, that business has supplied personnel to Alcoa for in excess of 20 years.

[26] The process followed to engage a labour hire worker involves an Alcoa Superintendent identifying a need for additional temporary labour; then approval to utilise a labour hire person is sought and provided through the sites 'People Movement Process'. Following approval, the relevant labour hire provider is contacted by Alcoa through the Superintendent and requested to provide a list of suitable persons; the labour hire provider will then present existing suitable persons and/or advertises for new persons; all persons must have completed the Alcoa Inductions and demonstrate relevant and required experience; Alcoa selects a suitable person from the list supplied; and the labour hire company then directly employs the nominated person who is required to undertake work as allocated by Alcoa.

[27] Chandler Macleod seeks candidates for Alcoa's mining operations by advertising for Trades Assistant's to maximise the responses to its advertisements.

[28] His evidence was that Mr Maxwell was supplied to Alcoa through a process consistent with that set out above and he was sourced by Alcoa for the purposes of providing coverage for a number of forecasted leave absences for Alcoa employees.

[29] The employment arrangements of labour hire personnel supplied to Alcoa are as agreed between the labour hire provider and the labour hire worker.

[30] Alcoa allocates work to labour hire personnel as required to meet operational needs. The labour hire provider is not allocated the work or otherwise involved in directing the performance of work.

[31] Mr Bacon’s evidence was that in order to reduce direct recruitment timeframes, Alcoa has established a 'Talent Pool' process which involves the application of a pre-employment recruitment process to identify and maintain a register of persons who may be suitable for employment with Alcoa in the event that a vacancy arises.

[32] Identification of potential Talent Pool participants can occur through observation of persons working on Alcoa sites or through placement of job advertisements.

[33] To be included on the register of persons for the Talent Pool, a prospective participant must attend an Assessment Centre at one of our Alcoa locations to undergo a number of interviews.

[34] After the assessment process, a Talent Pool panel discusses each participant's suitability for future roles across any of Alcoa's WA locations. If a prospective participant is deemed suitable, they must then complete temperament and aptitude testing and have a reference check conducted.

[35] Once the selection process is completed, a successful participant will be registered in the Alcoa Talent Pool until a specific vacancy is approved and the person is selected by the hiring department to be progressed to a pre-employment medical which they must pass before being offered employment by Alcoa.

[36] A person who is registered for inclusion in the Talent Pool may or may not be offered employment with Alcoa in a suitable vacancy.

[37] In April 2019, whilst still employed by Chandler Macleod, Mr Maxwell participated in a Talent Pool recruitment drive undertaken by Alcoa and was successful in being registered for inclusion in the Talent Pool.

[38] Mr Maxwell was put forward as a potential Talent Pool candidate by Mr Ian McCormick Fixed Plant Maintenance Superintendent Huntly on 4 April 2019. An email confirming that recommendation was provided to the Commission.

[39] As part of that recruitment drive for the Talent Pool, Alcoa received 465 applications and placed 10 persons in the Talent Pool for future consideration.

[40] On 27 June 2019, Mr Mark Every (Mr Every), a Senior Equipment Carer who had been employed by Alcoa since 16 August 1988, left his employment with Alcoa on the grounds of voluntary resignation.

[41] Mr McCormick sought and obtained approval from Alcoa's Mining - People Movements division to fill the vacancy created by Mr Every's departure. A copy of an email advising Mr McCormick that approval had been granted to fill the vacancy created was provided to the Commission.

[42] Mr McCormick then advised Alcoa HR that he wanted to employ Mr Maxwell in Mr Every's former role once all Talent Pool conditions had been met. A copy of an email from Mr McCormick to Ms Werndly regarding this was provided to the Commission.

[43] On 11 July 2019, Alcoa made an offer of employment to Mr Maxwell for the Senior Equipment Carer position made vacant by Mr Every. Mr Maxwell accepted Alcoa's offer of employment.

[44] Mr Bacon says that following the recruitment of Mr Maxwell, Chandler Macleod and other labour hire providers continue to provide Alcoa with personnel to allow it to meet its changing operational needs.

The work Mr Maxwell did

[45] Mr Maxwell gave evidence about the tasks he did and the rosters he worked whilst employed by Chandler Macleod and when employed by Alcoa.

[46] He says the location of work, roster arrangements and duties while employed directly by Alcoa were exactly the same as his employment for Chandler Macleod when he was deployed to work at Alcoa.

[47] While working at Alcoa, the tasks he says he completed included “ore handling type work” while working on behalf of Chandler Macleod such as:

a) Roller inspections

b) General housekeep of areas which have product build up.

c) Bobcat operations if need be

d) Roller change outs, under belt clean up

e) Stock yard operations, 

f) Structural wash downs in stockyard area

g) Train loader operations

h) Being an offsider for Tradesman

[48] While working for Alcoa, the tasks he did also included “maintenance type work” such as:

a) Being an Offsider for Tradesman during maintenance jobs

b) Fire watch

c) General housekeep of areas which have product build up

d) Bobcat operations

e) Chute hose out for safe access

f) Offsider for Tradesman in preparation for upcoming jobs on next maintenance shift

g) Carry out scheduled tasks as part of safety upkeep i.e., lifting equipment tagging, workshop clean up, and falls arrest tagging

h) Rigging and Dogman operations

[49] Alcoa’s witnesses both dispute the evidence of the Applicant that the work he did for Chandler Macleod was the same or substantially the same as the work he did for Alcoa.

[50] As will be seen this question does not need to be determined by the Commission in this instance.

The Issue

[51] By virtue of s.382(a) of the Act, the Applicant is only protected from unfair dismissal if he has completed the minimum period of employment with his employer, which in this case is six months.

[52] The Applicant was employed by the Respondent from 29 July 2019 to 11 September 2019 inclusive, which is a period of less than two months.

[53] The Applicant is therefore only entitled to proceed with this application if he can establish, for the purposes of s.384(1) of the Act, that his employment with Chandler Macleod constitutes service continuous with his service with the Respondent.

[54] The meaning of continuous service is set out in section 22 of the Act.

[55] The issue is whether in the Applicant’s case there has been continuous services having regard for ss.22(5) and (7)(b), which deal with whether an employee’s service is continuous when there is a transfer of employment of the employee from one employer to another.

The legislation

[56] The provisions relevant to determining this issue are set out below.

“22 Meanings of service and continuous service

General meaning

(1) A period of service by a national system employee with his or her national system employer is a period during which the employee is employed by the employer, but does not include any period (an excluded period) that does not count as service because of subsection (2).

(2) The following periods do not count as service:

(a) any period of unauthorised absence;

(b) any period of unpaid leave or unpaid authorised absence, other than:

(i) a period of absence under Division 8 of Part 2-2 (which deals with community service leave); or

(ii) a period of stand down under Part 3-5, under an enterprise agreement that applies to the employee, or under the employee’s contract of employment; or

(iii) a period of leave or absence of a kind prescribed by the regulations;

(c) any other period of a kind prescribed by the regulations.

(3) An excluded period does not break a national system employee’s continuous service with his or her national system employer, but does not count towards the length of the employee’s continuous service.

(3A) Regulations made for the purposes of paragraph (2)(c) may prescribe different kinds of periods for the purposes of different provisions of this Act (other than provisions to which subsection (4) applies). If they do so, subsection (3) applies accordingly.

Meaning for Divisions 4 and 5, and Subdivision A of Division 11, of Part 2-2

(4) For the purposes of Divisions 4 and 5, and Subdivision A of Division 11, of Part 2-2:

(a) a period of service by a national system employee with his or her national system employer is a period during which the employee is employed by the employer, but does not include:

(i) any period of unauthorised absence; or

(ii) any other period of a kind prescribed by the regulations;

And

(b) a period referred to in subparagraph (a)(i) or (ii) does not break a national system employee’s continuous service with his or her national system employer, but does not count towards the length of the employee’s continuous service; and

(c) subsections (1), (2) and (3) do not apply.

Note: Divisions 4 and 5, and Subdivision A of Division 11, of Part 2-2 deal, respectively, with requests for flexible working arrangements, parental leave and related entitlements, and notice of termination or payment in lieu of notice.

(4A) Regulations made for the purposes of subparagraph (4)(a)(ii) may prescribe different kinds of periods for the purposes of different provisions to which subsection (4) applies. If they do so, paragraph (4)(b) applies accordingly.

When service with one employer counts as service with another employer

(5) If there is a transfer of employment (see subsection (7)) in relation to a national system employee:

(a) any period of service of the employee with the first employer counts as service of the employee with the second employer; and

(b) the period between the termination of the employment with the first employer and the start of the employment with the second employer does not break the employee’s continuous service with the second employer (taking account of the effect of paragraph (a)), but does not count towards the length of the employee’s continuous service with the second employer.

Note: This subsection does not apply to a transfer of employment between non-associated entities, for the purpose of Division 6 of Part 2-2 (which deals with annual leave) or Subdivision B of Division 11 of Part 2-2 (which deals with redundancy pay), if the second employer decides not to recognise the employee’s service with the first employer for the purpose of that Division or Subdivision (see subsections 91(1) and 122(1)).

(6) If the national system employee has already had the benefit of an entitlement the amount of which was calculated by reference to a period of service with the first employer, subsection (5) does not result in that period of service with the first employer being counted again when calculating the employee’s entitlements of that kind as an employee of the second employer.

Note: For example:

(a) the accrued paid annual leave to which the employee is entitled as an employee of the second employer does not include any period of paid annual leave that the employee has already taken as an employee of the first employer; and

(b) if an employee receives notice of termination or payment in lieu of notice in relation to a period of service with the first employer, that period of service is not counted again in calculating the amount of notice of termination, or payment in lieu, to which the employee is entitled as an employee of the second employer.

Meaning of transfer of employment etc.

(7) There is a transfer of employment of a national system employee from one national system employer (the first employer) to another national system employer (the second employer) if:

(a) the following conditions are satisfied:

(i) the employee becomes employed by the second employer not more than 3 months after the termination of the employee’s employment with the first employer;

(ii) the first employer and the second employer are associated entities when the employee becomes employed by the second employer; or

(b) the following conditions are satisfied:

(i) the employee is a transferring employee in relation to a transfer of business from the first employer to the second employer;

(ii) the first employer and the second employer are not associated entities when the employee becomes employed by the second employer.

Note: Paragraph (a) applies whether or not there is a transfer of business from the first employer to the second employer.

(8) A transfer of employment:

(a) is a transfer of employment between associated entities if paragraph (7)(a) applies; and

(b) is a transfer of employment between non-associated entities if paragraph (7)(b) applies.

311 When does a transfer of business occur

Meanings of transfer of business, old employer, new employer and transferring work

(1) There is a transfer of business from an employer (the old employer) to another employer (the new employer) if the following requirements are satisfied:

(a) the employment of an employee of the old employer has terminated;

(b) within 3 months after the termination, the employee becomes employed by the new employer;

(c) the work (the transferring work) the employee performs for the new employer is the same, or substantially the same, as the work the employee performed for the old employer;

(d) there is a connection between the old employer and the new employer as described in any of subsections (3) to (6).

Meaning of transferring employee

(2) An employee in relation to whom the requirements in paragraphs (1)(a), (b) and (c) are satisfied is a transferring employee in relation to the transfer of business.

Transfer of assets from old employer to new employer

(3) There is a connection between the old employer and the new employer if, in accordance with an arrangement between:

(a) the old employer or an associated entity of the old employer;

and

(b) the new employer or an associated entity of the new employer;

the new employer, or the associated entity of the new employer, owns or has the beneficial use of some or all of the assets (whether tangible or intangible):

(c) that the old employer, or the associated entity of the old employer, owned or had the beneficial use of; and

(d) that relate to, or are used in connection with, the transferring work.

Old employer outsources work to new employer

(4) There is a connection between the old employer and the new employer if the transferring work is performed by one or more transferring employees, as employees of the new employer, because the old employer, or an associated entity of the old employer, has outsourced the transferring work to the new employer or an associated entity of the new employer.

New employer ceases to outsource work to old employer

(5) There is a connection between the old employer and the new employer if:

(a) the transferring work had been performed by one or more transferring employees, as employees of the old employer, because the new employer, or an associated entity of the new employer, had outsourced the transferring work to the old employer or an associated entity of the old employer; and

(b) the transferring work is performed by those transferring employees, as employees of the new employer, because the new employer, or the associated entity of the new employer, has ceased to outsource the work to the old employer or the associated entity of the old employer.

New employer is associated entity of old employer

(6) There is a connection between the old employer and the new employer if the new employer is an associated entity of the old employer when the transferring employee becomes employed by the new employer.”

Submissions

[57] For the Applicant it is submitted that the Applicant’s minimum employment period (MEP) of six months must include the employment period with the old employer (Chandler Macleod from 12 November 2018 to 27 July 2019) as service with the new employer (Alcoa from the period 27 July 2019 to 11 September 2019). In turn, the Applicant’s service with the old employer can only count if the Commission is satisfied a ‘transfer of business’ occurred in accordance with s.311(5) of the Act. If that is the case, an aggregate total of 10 months can be counted towards the MEP including the end date pursuant to s.22(5), s.22(7) (b) and s.311(5) of the Act, which would result in the Applicant being able to access the jurisdiction of the Commission’s Unfair Dismissal remedy scheme.

[58] For the purposes of s.311 the Applicant submits that the Applicant’s employment with the old employer was terminated on or around 27 July 2019 and the Applicant’s employment with the new employer began on or around 27 July 2019. Therefore, there was not a significant gap between the Applicant finishing with the old employer and starting with the new employer.

[59] The Applicant performed the same work in his employment with Chandler Macleod and Alcoa. Chandler Macleod is also a self-described “Outsourcing Company”.

[60] The Applicant ceased performing “the work” for the old employer Chandler Macleod when he began working for and did exactly the same work for Alcoa.

[61] For the reasons described above, the Applicant can be accurately portrayed as a “transferring employee”.

[62] Accordingly, the Commissions’ jurisdiction is enlivened to hear this application for unfair dismissal remedy.

[63] The Applicant relies upon the cases ofRicky Taulapapa v Toll Personnel Pty Limited [2018] FWC 6242, Thorne v Jura Australia Espresso Pty Ltd[2012] FWA 4954 and Burdziejko v ERGT Australia Pty Ltd[2015] FWC 2308.

The Respondents submission

[64] For the Respondent it is submitted that Alcoa at its Huntly mine, typically utilises additional labour supplied by labour hire providers for:

a) coverage of planned and unplanned leave;

b) peak workloads;

c) work of a short duration; and

d) work that may cease in the foreseeable future.

[65] The number of labour hire workers at Huntly fluctuates throughout the year based on operational needs. Approximately 100 labour hire workers are currently being provided by multiple labour hire agencies to undertake work at the Respondent’s Huntly mine.

[66] Alcoa has been utilising the services of Chandler Macleod to provide such supplemental labour for approximately 20 years.

[67] The Applicant was, through Chandler Macleod, placed at the Respondent’s Huntly mine from:

a) 12 November 2018 and 7 July 2019 inclusive; and

b) 15 July and 28 July 2019 inclusive.

[68] To streamline its recruitment processes and to try and ensure that there are workers available to fill vacancies within its workforce, the Respondent operates a recruitment process called the Talent Pool.

[69] The Talent Pool is a pool recruitment process:

a) whereby the Respondent identifies workers who meet its requirements for direct employment; and

b) which reduces the time taken to fill vacancies that arise.

[70] The Applicant was placed into the Talent Pool in April 2019.

[71] On 27 June 2019, Mr Every, a Senior Equipment Carer employed by the Respondent, left his employment with the Respondent on the grounds of voluntary resignation.

[72] In the lead up to this a review of the persons within the Talent Pool was made and a decision was made to select the Applicant as the preferred candidate for permanent employment with the Respondent in Mr Every’s vacated position.

[73] Following the selection of the Applicant as the preferred candidate for employment in Mr Every’s position, the final recruitment steps were completed, which included the Applicant undergoing a pre-employment medical.

[74] The Applicant commenced employment with the Respondent on 29 July 2019.

[75] Notwithstanding the Applicant becoming employed by the Respondent, the Respondent continues to obtain supplemental labour through Chandler Macleod, including for its Huntly mine.

[76] The Applicant is only protected from unfair dismissal if he has completed the minimum period of six months with the Respondent.

[77] The Applicant was employed by the Respondent from 29 July 2019 to 11 September 2019 inclusive, which is a period of less than two months.

[78] The Applicant is therefore only entitled to proceed with this application if he can establish, for the purposes of s.384(1) of the Act, that his employment with Chandler Macleod constitutes service continuous with his service with the Respondent.

[79] The meaning of continuous service is set out in section 22 of the Act.

[80] Relevantly in the present case, the Applicant must establish that there has been continuous services having regard for sub-sections (5) and (7)(b) of s.22, which deal with whether an employee’s service is continuous when there is a transfer of employment of the employee from one employer to another.

[81] Those relevant sections provide as follows:

“22 Meanings of service and continuous service

General meaning

(1) A period of service by a national system employee with his or her national system employer is a period during which the employee is employed by the employer, but does not include any period (an excluded period ) that does not count as service because of subsection (2).

(2) The following periods do not count as service:

(a)  any period of unauthorised absence;

(b)  any period of unpaid leave or unpaid authorised absence, other than:

(i)  a period of absence under Division 8 of Part 2-2 (which deals with community service leave); or

(ii)  a period of stand down under Part 3-5, under an enterprise agreement that applies to the employee, or under the employee's contract of employment; or

(iii)  a period of leave or absence of a kind prescribed by the regulations;

(c)  any other period of a kind prescribed by the regulations.

(3) An excluded period does not break a national system employee's continuous service with his or her national system employer, but does not count towards the length of the employee's continuous service.

(3A)  Regulations made for the purposes of paragraph (2)(c) may prescribe different kinds of periods for the purposes of different provisions of this Act (other than provisions to which subsection (4) applies). If they do so, subsection (3) applies accordingly.

Meaning for Divisions 4 and 5, and Subdivision A of Division 11, of Part 2-2

(4) For the purposes of Divisions 4 and 5, and Subdivision A of Division 11, of Part 2-2:

(a)  a period of service by a national system employee with his or her national system employer is a period during which the employee is employed by the employer, but does not include:

(i)  any period of unauthorised absence; or

(ii)  any other period of a kind prescribed by the regulations; and

(b)  a period referred to in subparagraph (a)(i) or (ii) does not break a national system employee's continuous service with his or her national system employer, but does not count towards the length of the employee's continuous service; and

(c)  subsections (1), (2) and (3) do not apply.

Note:          Divisions 4 and 5, and Subdivision A of Division 11, of Part 2-2 deal, respectively, with requests for flexible working arrangements, parental leave and related entitlements, and notice of termination or payment in lieu of notice.

(4A)  Regulations made for the purposes of subparagraph (4)(a)(ii) may prescribe different kinds of periods for the purposes of different provisions to which subsection (4) applies. If they do so, paragraph (4)(b) applies accordingly.

When service with one employer counts as service with another employer

(5)  If there is a transfer of employment (see subsection (7)) in relation to a national system employee:

(a)  any period of service of the employee with the first employer counts as service of the employee with the second employer; and

(b)  the period between the termination of the employment with the first employer and the start of the employment with the second employer does not break the employee's continuous service with the second employer (taking account of the effect of paragraph (a)), but does not count towards the length of the employee's continuous service with the second employer.

Note:          This subsection does not apply to a transfer of employment between non-associated entities, for the purpose of Division 6 of Part 2-2 (which deals with annual leave) or Subdivision B of Division 11 of Part 2-2 (which deals with redundancy pay), if the second employer decides not to recognise the employee's service with the first employer for the purpose of that Division or Subdivision (see subsections 91(1) and 122(1)).

(6)  If the national system employee has already had the benefit of an entitlement the amount of which was calculated by reference to a period of service with the first employer, subsection (5) does not result in that period of service with the first employer being counted again when calculating the employee's entitlements of that kind as an employee of the second employer.

Note:          For example:

(a)    the accrued paid annual leave to which the employee is entitled as an employee of the second employer does not include any period of paid annual leave that the employee has already taken as an employee of the first employer; and

(b)    if an employee receives notice of termination or payment in lieu of notice in relation to a period of service with the first employer, that period of service is not counted again in calculating the amount of notice of termination, or payment in lieu, to which the employee is entitled as an employee of the second employer.

Meaning of transfer of employment etc.

(7)  There is a transfer of employment of a national system employee from one national system employer (the first employer ) to another national system employer (the second employer ) if:

(a)  the following conditions are satisfied:

(i)  the employee becomes employed by the second employer not more than 3 months after the termination of the employee's employment with the first employer;

(ii)  the first employer and the second employer are associated entities when the employee becomes employed by the second employer; or

(b)  the following conditions are satisfied:

(i)  the employee is a transferring employee in relation to a transfer of business from the first employer to the second employer;

(ii)  the first employer and the second employer are not associated entities when the employee becomes employed by the second employer.

Note:          Paragraph (a) applies whether or not there is a transfer of business from the first employer to the second employer.

(8)  A transfer of employment:

(a)  is a transfer of employment between associated entities if paragraph (7)(a) applies; and

(b)  is a transfer of employment between non-associated entities if paragraph (7)(b) applies.”

[82] Section 311 of the Act deals with transfer of business and relevantly provides at subsection (1):

“311 When does a transfer of business occur

Meanings of transfer of business, old employer, new employer and transferring work

(1) There is a transfer of business from an employer (the old employer) to another employer (the new employer) if the following requirements are satisfied:

(a) the employment of an employee of the old employer has terminated;

(b) within 3 months after the termination, the employee becomes employed by the new employer;

(c) the work (the transferring work) the employee performs for the new employer is the same, or substantially the same, as the work the employee performed for the old employer;

(d) there is a connection between the old employer and the new employer as described in any of subsections (3) to (6).”

[83] The Applicant’s case is based on there being a connection between the old employer (Chandler Macleod) and the new employer (the Respondent) as contemplated by s.311(5) of the Act, which provides as follows:

“New employer ceases to outsource work to old employer

(5) There is a connection between the old employer and the new employer if:

(a) the transferring work had been performed by one or more transferring employees, as employees of the old employer, because the new employer, or an associated entity of the new employer, had outsourced the transferring work to the old employer or an associated entity of the old employer; and

(b) the transferring work is performed by those transferring employees, as employees of the new employer, because the new employer, or the associated entity of the new employer, has ceased to outsource the work to the old employer or the associated entity of the old employer.”

[84] The Respondent submits, for the following reasons, that the requirements of s.311(5) were not met when the Respondent employed the Applicant on 29 July 2019:

a) At first instance, there is no valid basis for asserting that the Applicant was performing ‘outsourced’ work whilst employed by Chandler Macleod.

Relevantly, Chandler Macleod:

(i) was not tasked, or engaged, by the Respondent to undertake the work that was performed by the Applicant during the period of his employment – Chandler Macleod was merely tasked with supplying a labour resource;

(ii) had no responsibility for the work performed by the Applicant or for giving direction as to how such work was to be performed;

(iii) was, in summary, the employer of the Applicant and nothing more.

In circumstances where there was no outsourcing of the work to begin with, there can be no cessation of outsourcing as contemplated by s.311(5)(b).

b) Even if the Applicant’s initial engagement with Chandler Macleod could be characterised as having arisen due to a decision taken by the Respondent to ‘outsource’ work (which the Respondent submits is not the case), a transfer of business ought not be found to have occurred on the grounds that:

•  The work performed by the Applicant following his employment by the

Respondent cannot correctly be characterised as ‘transferring work’ as

•  by s.311(1)(c) because:

A. Whilst employed by Chandler Macleod, the Applicant undertook, after a process of familiarisation with the Respondent’s requirements, duties as an Ore Handler; and

B. After the commencement of his employment with the Respondent (following his participation in a detailed merit-based selection process to enter the Talent Pool and him being offered employment as a Senior Equipment Carer), the Applicant undertook trades assistant work.

(ii) The Applicant’s employment in the role held formerly by Mr Every cannot be characterised as occurring because the Respondent had ceased to outsource the work to Chandler Macleod as:

A. The purpose of the Applicant’s initial engagement was to provide backfill for employees of the Respondent who were absent on leave (which did not include Mr Every);

B. The role which was offered to the Applicant was the Senior Equipment Carer role formerly held by Mr Every, whose employment with the Respondent did not end until 27 June 2019;

C. The Applicant’s employment in the role formerly held by Mr Every did not arise as a consequence of the Respondent ceasing to outsource the backfilling of employees who were absent on leave; and

D. In any event, the duration of the Applicant’s engagement was foreshadowed not to extend beyond July 2019.

[85] The Applicant has relied on a number of decisions of the Fair Work Commission (Commission) in support of his contention that the Applicant’s period of service with Chandler Macleod can be taken into account for the purpose of determining whether the requirements of s.383 of the Act have been met by virtue of s.311(5).

[86] The Respondent submits that such decisions are distinguishable from the circumstances in this matter.

[87] In respect of Commissioner Cargill’s decision in Thorne v Jura Australia[2012] FWA 4954, it is observed that:

(a) the engagement of the applicant in that matter was as part of what was clearly a broader outsourcing/servicing agreement involving not only the provision of labour, but also the provision of other items and equipment [paragraph 5]; and

(b) there also appeared to be no difference in the duties performed by the applicant with the old employer and the new employer.

[88] Such factual matrix is highly inconsistent with the facts of this matter (where the Respondent submits there has been no outsourcing and the duties performed by the Applicant post – employment was not the same, or similar to those performed prior to the commencement of employment).

[89] In respect of the decisions of Commissioner Cambridge in Taulapapa v Toll Personnel Pty Limited[2018] FWC 6242 and Deputy President Gooley in Burdziejko v ERGT Australia Pty Ltd[2015] FWC 2308, it is observed that the respective applicants in each of those matters undertook the same role with their old employer as with their new employer and the initial outsourcing and subsequent insourcing represented the totality of the relationship between the employer and the labour hire company – which is inconsistent with the factual matrix of the matter presently before the Commission.

[90] In contrast, in each of the following decisions no connection was found between the new and old employers:

a) Gaudsen v Silvan Pty Ltd[2014] FWC 5337, Commissioner Spencer (Gaudsen);

b) Cokuzovski v Yarra City Council[2018] FWC 155, Deputy President Millhouse (Cokuzovski); and

c) Abbott v Acciona Infrastructure Australia Pty Ltd, [2018] FWC 5609, Deputy President Asbury (Abbott).

[91] Furthermore, each of the abovementioned decisions involved a relationship between the employer and the labour hire company which:

(a) existed prior to the engagement of each respective applicant; and

(b) continued, notwithstanding that each respective applicant had ceased working for the relevant labour hire company and commenced employment with the respective respondent (i.e. new employer) to whom their services had been supplied.

[92] This distinction between the competing authorities was the basis for the decision of Deputy President Asbury in Abbott – particularly relevant is the analysis of Deputy President Asbury at paragraphs [43] to [52] of that decision.

[93] At paragraph [47] of Abbott, Deputy President Asbury set out the following circumstances which she considered were relevant to making a finding as to whether there existed an outsourcing arrangement between an employer and a labour hire provider:

“•  The nature of the arrangement between the provider of the labour and the company engaging the labour;

•  Whether that arrangement continues after the putative outsourcing has taken place;

•  Whether all or some of the labour hire employees in the particular workplace are offered employment at the time of the putative cessation of the outsourcing; and

•  Whether the company engaging the labour has some employees “in house” who are carrying out the work and will continue to do so.”

[94] The nature of the relationship between the Respondent and Chandler Macleod is the same as that in the Gaudsen, Cokuzovski and Abbott decisions.

[95] The Respondent employs a large permanent workforce which is supplemented, to a relatively small degree, through relationships with the three labour hire companies

[96] The relationship between the Respondent and Chandler Macleod was neither founded nor ended with the decision to employ the Applicant and, consistent in particular with the abovementioned decisions of Deputy Presidents’ Millhouse and Asbury, the decision to employ the Applicant should not be considered to amount to a decision by the Respondent to cease to outsource the work performed by the Applicant from the time he was employed by the Respondent.

[97] The Respondents accepts that in the absence of a decision by a Full Bench of the Commission, none of the authorities referred to are binding on the Commission. However, whilst the Commission in this instance is not bound by the principles of single decisions, the Full Bench has made clear that there should only be a departure from its principles (and therefore prior decisions by the Commission) if there is a sufficient reason to do so. 1

CONSIDERATION

[98] I note there is a disagreement between the witnesses as to the work Mr Maxwell did for Chandler Macleod and then for Alcoa. This issue is relevant given the requirement in s.311(1)(c) that the “transferring work” was the same or substantially the same with both employers for there to have been a transfer of business, however that question need not be determined in this case to determine the application.

[99] The case of Abbott considers in detail the issues that arise when considering the application of s.311 to different circumstances.

[100] The factual background to that case included that Acciona Infrastructure Australia Pty Ltd (Acciona) conceded that s.311(1)(a)–(c) had been met. The issue for determination in that case was whether there was a connection between DBS Queensland Pty Ltd (Dowells) and Acciona as provided for in s.311(5) on the basis that the work was outsourced and that the outsourcing ceased when the employee was employed directly by Acciona.

[101] Deputy President Asbury reviewed a number of prior Commission decisions that had dealt with this provision in the legislation. These decisions had resulted in a range of different outcomes in circumstances of course that were particular to the specific facts of each case.

[102] Relevantly for the purposes of the matter currently before the Commission, Deputy President Asbury’s consideration is set out below.

“[43] The term “outsource” is not defined in the Act. I accept that the term should be given its ordinary meaning – to contract work outside a company rather than employ more in-house staff. I also accept that on the plain wording of s. 311(5) there is no apparent requirement that work must have been done in-house before it can be outsourced. In my view, the term “outsource” can apply equally in cases where an employer currently undertakes work inhouse or where it plans to undertake new work and decides that rather than directly employing persons to undertake that work, it will outsource the work so that it is undertaken by an external provider.

[44] I do not accept that the term “outsource” applies to any circumstance where an employer engages labour from an external supplier to undertake any work within the employer’s business. The provisions focusing on the work of a particular employee are found in s. 311(1)(a) – (c) . Where those are met, there is an additional requirement in s. 311(d) that there be a connection between the old employer and the new employer as described in any of subsections 311(3) – (6). In establishing such a connection for the purposes of those subsections, the term “outsource” must have some work to do. That term in my view, directs attention to the outsourcing arrangement which is the arrangement between the entity outsourcing the work and the entity which will perform the work. It is only where such an arrangement is in place that a connection between two employers as provided in s. 311(4) and (5) will be established. In short, something more than an employee ceasing to perform particular work for one employer and commencing to perform the same or substantially the same work at the same location for another employer is required.

[45] If this was not the case then there would be no requirement to use the term “outsource” and the legislation would simply state that where an employee performs work in a particular workplace for one employer and is offered substantially the same work in the same workplace by another employer, the service of the employee will be deemed continuous. Clearly the additional requirement that there be a connection must operate on the basis of something additional. Each of the subsections 311(3) – (6) provide for additional requirements to establish a connection for the purposes of s. 311(d).

[46] An employer contracting with a labour hire company for the labour hire company to provide an employee of the labour hire company to supplement its workforce or to replace an absent employee will not automatically be found to have outsourced the relevant work. Rather, the employer may simply be engaging additional labour in a flexible manner, to ensure that it can continue to undertake particular work. Conversely, it does not follow that an employer who has engaged an employee of a labour hire company to supplement its own workforce, or to replace an absent employee and then after a period of time offers that employee employment within its business, will be found to have ceased to outsource the work the relevant employee was previously undertaking.

[47] In my view there is a distinction between an employer engaging supplementary labour through a labour hire company and outsourcing work. There will be occasions where the distinction is difficult to establish and the side of the line that a particular case falls on will be determined by the facts and circumstances of that case including:

•  The nature of the arrangement between the provider of the labour and the company engaging the labour;

•  Whether that arrangement continues after the putative outsourcing has taken place;

•  Whether all or some of the labour hire employees in the particular workplace are offered employment at the time of the putative cessation of the outsourcing; and

•  Whether the company engaging the labour has some employees “in house” who are carrying out the work and will continue to do so.

[48] The approach to applying s. 311(5) I favour is not inconsistent with the plain words in the legislation. Outsourcing can occur when one employee or a number of employees are involved. This approach is not inconsistent with the example in the Explanatory Memorandum which indicates that all of the relevant employees (security guards) were provided by a contract security company and were all offered employment in the workplace where they had been engaged to perform the same work as direct employees of the employer that operated that workplace. Accordingly, there was outsourcing and a subsequent cessation of outsourcing.

[49] This approach does not necessarily give rise to an inconsistency in the decided cases referred to by the parties. In Burdziejko it does not appear that there was a great deal of evidence about the arrangement between the two relevant entities. The second entity in that case did employ other employees termed customer service officers and contended that the applicant was engaged to supplement its labour force because it obtained a new client. It is not clear whether there were any other employees provided by the labour hire company as supplementary labour at the relevant time. It is also not clear whether the employee in that case only performed work for the new client which had generated the additional workload, or whether the work for that new client was different than the work performed in house for other clients. It is also not apparent that the labour hire arrangement continued after the putative outsourcing or that the labour hire company continued to provide employees to the employer in question after the applicant took up employment with that employer.

[50] In Sapienza it is apparent that all of the work in a particular state was outsourced to another entity in accordance with a contract between the two entities and was then brought in house in circumstances where the employees employed by one party to the contract who had been performing the work subject of the contract were offered employment with the other party to the contract. This was also the case in Jura where there was an agreement between two entities for the provision of labour and a number of the employees engaged by one entity pursuant to that contract were offered and accepted employment with the other entity party to the contract, in circumstances where the former entity had performed all of the relevant work for the latter entity.

[51] In Gausden there was a contract for the provision of labour by a labour hire company to an employer which operated a warehouse and the applicant in that case was engaged in the course of the labour hire company providing supplementary labour.11 It follows that the employer in that case employed other persons to carry out warehousing duties such that it could not be said that it had outsourced that function. It is also probable that given the nature of the labour hire arrangement, it remained in effect after the employment of the applicant in that case had ceased. This was certainly the case in Cokuzovski and is the basis for distinguishing that case from Burdziejko.

[52] On the facts in the present case, Acciona as a part of the Nexus Delivery Joint Venture, directly employed some of the employees who were performing work on the Project. At the same time, Acciona supplemented its direct labour force with additional employees provided by Dowells, a labour hire company. The arrangement between Acciona and Dowells for the supply of labour was in place before Mr Abbott was employed by either entity and continued after Mr Abbott commenced employment with Acciona. I do not accept that this arrangement is outsourcing. I also do not accept that in the circumstances of this case, by offering employment to Mr Abbott, Acciona ceased to outsource the work Mr Abbott had previously performed as an employee of Dowells. Accordingly I am not satisfied as required by s. 311(5) that the work was outsourced or that outsourcing had ceased.

[103] I agree with Deputy President Asbury’s reasoning and interpretation of s.311 and will adopt this approach in determining this application.

[104] Considering the evidence in this case Alcoa at its Huntly mine directly employed employees who undertook work and at the same time supplemented its direct employees with additional workers sourced from a number of labour hire companies including Chandler Macleod.

[105] The particular labour hire arrangement between Alcoa and Chandler Macleod had been operating for approximately 20 years, far earlier than the employment by Chandler Macleod of the Applicant.

[106] That labour hire arrangement between Alcoa and Chandler Macleod continued in operation after the Applicant was employed by Alcoa and that labour hire arrangement continues to operate notwithstanding the Applicant’s employment with Alcoa has ended.

[107] In these circumstances, I am not satisfied the arrangement between Alcoa and Chandler Macleod was outsourcing.

[108] Alcoa by employing the Applicant was not ceasing to outsource the work he had previously performed whilst an employee of Chandler Macleod.

[109] My decision is that in this case neither of the requirements prescribed in s.311(5)(a) or (b) are satisfied and consequently there was no transfer of business within the meaning of s.311 of the Act.

[110] As a consequence of that decision the Commission does not need to determine other grounds for Alcoa’s objection that where advanced in its submissions.

[111] Considering the meanings of service and continuous service prescribed in s.22 the Applicant’s service with Chandler Macleod is not continuous with his service with Alcoa.

[112] The Applicant at the time of his dismissal had not completed the minimum employment period of six months and by virtue of s.382 was not a person protected from unfair dismissal. That being the case the Applicant was not able to make this application to the Commission which will now be dismissed, and an order issued to that effect.

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 1   CFMEU v Broadspectrum Australia Pty Ltd[2017] FWCFB 269 at [45].