Textile, Clothing and Footwear Union of Australia v The 2000 Fashion
[2017] FWC 5878
•14 NOVEMBER 2017
| [2017] FWC 5878 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.739—Dispute resolution
Textile, Clothing and Footwear Union of Australia
v
The 2000 Fashion
(C2017/3366)
| COMMISSIONER RYAN | MELBOURNE, 14 NOVEMBER 2017 |
Alleged dispute about any matters arising under the modern award.
The Applicant filed an application for the Fair Work Commission to deal with a dispute in accordance with the disputes procedure in the Textile Clothing Footwear and Associated Industries Award 2010 (the Award) in relation to the entitlements of two members of the Applicant employed by the Respondent.
The Application in this matter was subject to a conciliation conference on 4 July 2017 but the dispute remained unresolved. The Applicant proposed that the dispute be arbitrated by the Commission.
The dispute resolution procedure in the Award only permits the Commission to arbitrate a matter in dispute if the parties to the dispute consent to having the matter arbitrated.
The Applicant, on 11 July 2017, proposed a specific formulation of the issue to be arbitrated and the Respondent agreed with that formulation and consented to have that matter arbitrated. The specific matter for arbitration was identified as follows:
· The dispute is between the Applicant (TCFUA) representing its members Viet Hai HO and Thi Thuy Ha TRAN (‘the members’), and the Respondent, HUYNH, Ngoc Thanh t/as The 2000 Fashion
· A determination of the entitlements, including quantum, payable to the members on the termination of their employment (effective 12 July 2017) under the relevant award, state and federal legislation with respect to:
(i) Annual leave and annual leave loading;
(ii) Long Service Leave; and
(iii) Superannuation”
Directions were issued to the parties in relation to the filing and serving of witness statements and outline of submissions and the matter was listed for hearing on 22 September 2017. The hearing was limited to the hearing of evidence from the Applicant’s two members and from Mr Huynh, the owner of the Respondent. Following the hearing further directions were issued in relation to the filing and serving of closing submissions by both parties. The last of the closing submissions was filed by the Applicant on 6 November 2017.
The issue of superannuation was resolved by the parties during the course of this matter and there was no issue to be determined by the Commission.
The issues in dispute were complicated by the fact that only for the period between May 2011 and July 2017 were the two members of the Applicant employees of the Respondent. The dispute also concerned the entitlement of the two members of the Applicant for a period between March/April 2010 and May 2011 where the two members of the Applicant performed work for the Respondent as outworkers.
There was significant disputation between the Applicant and the Respondent over the following issues:
· When did the two workers commence working as outworkers for the Respondent;
· How many hours work did the two workers perform for the Respondent whilst working as outworkers;
· The status of the two workers as outworkers (were they casual or permanent?);
· The amount of leave taken by the two workers over the entire period working for the Respondent
The evidence of the two workers and of the owner provided very different perspectives and accounts in relation to each of these issues.
When did the two workers commence working as outworkers for the Respondent?
The common starting point for both the Applicant and the Respondent was 16 April 2010 when an invoice was provided by the two workers to the Respondent for work done. The invoice identified that the two workers produced 1555 cardigan tops. The evidence of Mr Huynh was that the two workers commenced providing work for him as from 1 April 2010. The evidence of Mr Ho is strongly supportive of a finding that the working relationship between Mr Huynh and both Mr Ho and Ms Tran commenced in March 2010. For the purposes of the present matter I am prepared to treat the working relationship as having a commencement date of 1 April 2010.
How many hours work did the two workers perform for the Respondent whilst working as outworkers?
In this matter the exact number of hours of work performed by the two workers in the period from 1 April 2010 to May 20111 is not known and cannot be identified. However, the Applicant contended that the two workers performed 25 hours per week of work for the Respondent during that period. The Respondent appears to have adopted the 25 hours per week per person as a convenient figure for the purposes of calculating the hours worked by the two workers.
The evidence of Mr Ho strongly supports a finding that Mr Ho and his wife performed more than 25 hours of work each week for the Respondent in the period between 1 April 2010 and May 2011. However, as the Applicant is content to base its claim in this matter on 25 hours of work by each person each week then the Commission will adopt the same figure.
The Applicant calculates the total number of hours of work of the two workers by simply multiplying the number of weeks by 25 and then converting this into weeks worked and then deducting a period of 4 weeks in which it was agreed no work was performed by the two workers. The Respondent uses the same starting point but then converts the number of weeks worked into months worked. The Respondent conclusion as to hours worked was expressed as follows:
“Hence from 1 April 2010 to 5 May 2011, i.e. 13 months and 5 days the outworkers worked 8 months and 3 days and did not work for 5 months and 2 days.”
The Respondent’s approach of reducing the hours worked into months worked is not helpful. As the issue in dispute concerns the entitlements of the two workers any such entitlements will be calculated having regard to the hours worked each week and the number of weeks worked. The number of weeks worked is important as it impacts on the concept of continuous service for the purpose of calculating leave entitlements.
The status of the two workers as outworkers - were they casual or permanent?
The Applicant contends that each of the two workers were working continuously for the Respondent from March 2010 until their termination in July 2017. The Applicant contends that the two workers were working on a permanent basis and so entitled to accrue annual leave and long service leave. The Respondent contends that during the period from 1 April 2010 to May 2011 the two workers were working on a casual basis and that for this period the two workers had no entitlement to accrue any form of leave. The Respondent characterised the pattern of work of the two workers as:
“6. However, even though they are considered to be employees, the fact remains that they were working as employees sporadically from 1 April 2010 - 5 May 2011, i.e. for this 13 months and 5 days they only worked sporadically or intermittently and earned an aggregated or accumulated total income of $30,680.22 In addition their work arrangement when converted to an employer/employee context has all the hallmarks or indicia of a casual employment and none of the indicia of full time or part time employees in the next paragraph.
7. The following are taken from the webpage of the Fair Work Ombudsman,
“A casual employee:
has no guaranteed hours of work
usually works irregular hours (but can work regular hours)
doesn't get paid sick or annual leave
can end employment without notice, unless notice is required by a registered agreement, award or employment contract.
How is casual different to full-time or part-time?
Full-time and part-time employees have ongoing employment (or a fixed-term contract) and can expect to work regular hours each week. They are entitled to paid sick leave and annual leave.
Full-time and part-time employees must give or receive notice to end the employment.”
The evidence of both Mr Ho and Mr Huynh supports a conclusion that both Mr Ho and Ms Tran were working for the Respondent on a regular and systematic basis and not sporadically or intermittently. Whilst both Mr Ho and Ms Tran were performing work for the Respondent as subcontractors the evidence shows that the work was provided on a regular basis and the work appears to have been provided on the basis of a continuing supply of work. As each contract was finished another would be allocated within a short period of the completion of the earlier contract. The fact that there were periods of time between the allocation of each contract does not mean that the work was performed sporadically or intermittently. Rather the reverse is true. The work was regular and systematic. For the purposes of the determination of the entitlement of the two workers their period of work between 1 April 2017 and May 2011 equated to permanent part time employment.
The amount of leave taken by the two workers over the entire period working for the Respondent?
The Applicant conceded that each worker had taken 200 hours of annual leave over the entire period of work. The Applicant conceded that there was an additional period of 4 weeks when the two workers were told not to attend work as there was no work for them. The Respondent contended that Ms Tran also took an additional 4 weeks annual leave. Having regard to the evidence in this matter the Commission accepts that each of the two workers took 200 hours of annual leave and that the additional 100 hours when the workers were told not to attend work should also be counted as annual leave taken. However, given the conflict in the evidence concerning the Respondent’s claim that Ms Tran took an additional 100 hours of annual leave the Commission prefers the evidence of the two workers and the Commission is prepared to accept that Ms Tran took the same amount of annual leave as her husband, namely 300 hours.
Calculating the leave entitlements of the two workers
Having determined the above three issues it is necessary to now calculate the entitlements of the two workers for the period of work from 1 April 2010 to the date of termination – 12 July 2017. The Applicant provided in table form its calculations as to the amount of leave entitlements of each of the two workers and the amount of money still to be paid to those two workers. The tables are as follows:
Formula Start Date 1/04/2010 End Date 12/07/2017 Period in Years 7.28 Period in Weeks 378.82 Subtract one month / 4 weeks A 374.82 Annual Leave Accrual A * 1.9231 B 720.80 Amount of Annual Leave taken C 300.00 Untaken Annual Leave B - C D 420.80 Value of Annual Leave D * 20.21 E 8,504.39 Leave Loading on the above E * 17.5% F 1,488.27 Total E + F G 9,992.65 Amount paid H 6,895.00 Balance owed G - H I 3,097.65
Formula Start Date 1/04/2010 End Date 12/07/2017 Period in Years 7.28 Period in Weeks 378.82 Subtract one month / 4 weeks A 374.82 Long Service Leave Accrual B 156.17 Value of Long Service Leave B * 20.21 C 3,156.27 Amount paid D 0.00 Balance owed C-D E 3,156.27
The calculations of the Applicant must be preferred over those of the Respondent. As the Applicant correctly identified in its Closing Submissions in Reply the Respondent made a simple mathematical error in calculating one period of time. Also the Respondent in treating the period of work performed between 1 April 2010 and May 2011 as being 8 months and 3 days is confusing the actual cumulative hours worked with the period over which those hours were worked. It is the latter which is necessary for the purpose of calculating a period of continuous service and the former is necessary for calculating the long service leave entitlement for the period of service.
In the present matter the Commission is satisfied that each of the two workers are entitled to an additional payment of $3,097.65 for annual leave and annual leave loading and a further $3,156.27 for long service leave.
The Applicant has sought that the Commission issue an order requiring the payment of the amounts owed to the two workers be paid by the Respondent within 7 days. The Respondent made no submission in relation to the time in which any payment should be made. I will give the Applicant and the Respondent an opportunity to reach agreement on a timeframe for the payments to be made to the two workers. Failing any agreement the Commission will determine a timeframe. If either the Applicant or the Respondent wish to file any further submissions in relation to determination of the timeframe for the payment of the monies to be paid to the two workers such submissions are to be filed and served by close of business on Wednesday 21 November 2017.
COMMISSIONER
Appearances:
O. Tran for the Textile, Clothing and Footwear Union of Australia
J. Lim on behalf of The 2000 Fashion
Hearing details:
2017.
Melbourne:
September 22.
Printed by authority of the Commonwealth Government Printer
<Price code C, PR597582>
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