Ulla Lonnqvist v Metro Trains Melbourne Pty Ltd

[2016] FWC 7451

[2016] FWC 7451

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Ulla Lonnqvist
v
Metro Trains Melbourne Pty Ltd
(U2016/10617)

DEPUTY PRESIDENT GOOLEY MELBOURNE, 14 OCTOBER 2016

Application for relief from unfair dismissal.

[1] Ms Ulla Lonnqvist was employed by Metro Trains Melbourne Pty Ltd form 2 March 2015 until 5 August 2016. Ms Lonnqvist says the termination of her employment was harsh unjust or unreasonable. Metro Trains objected to Ms Lonnqvist’s claim because it says she was employed under a contact of employment for a specified period of time and her employment ended due to the effluxation of time and not at the initiative of Metro Trains.

[2] At the conclusion of the determinative conference, I advised the parties that as I had found that Ms Lonnqvist’s employment was terminated by Metro Trains on 5 August 2016, the objection lodged by Metro Trains was dismissed. These are my reasons.

Matters not in contest

[3] Ms Lonnqvist was initially offered what was described as a maximum term contract on 23 February 2015. That contract was accepted by Ms Lonnqvist and it was due to expire on 2 March 2016 unless agreed in writing in advance of that date. That contract expressly provided that it was not a fixed term contract and that the employment may be terminated prior to the maximum term for any reason by giving notice as provided in the schedule, which in this case, is four weeks. The contract further provided that the contract could be terminated without notice if Ms Lonnqvist engaged in any act of serious or wilful misconduct. That contract was extended by letter of offer dated 25 February 2016 and the contract was then due to expire on 2 September 2016. For the purpose of this agreement all other terms were as per the initial contract of employment.

Matters in contest

[4] On 5 August 2016, Ms Lonnqvist gave evidence that she was told that her contract would not be renewed and that she was to hand in her security pass and other Metro Trains property and say goodbye to her work colleagues. She said she was verbally dismissed and said she did not receive any written notice of her termination on 5 August 2016. Metro Trains put into evidence a letter it said was given to Ms Lonnqvist at the meeting on 5 August. 1 Metro Trains did not call evidence from any person present at the meeting to support this submission.

[5] However Metro Trains tendered the letter to support its contention that Ms Lonnqvist’s employment was not terminated at the initiative of the employer. The letter states as follows:

“I wish to formally advise you in writing that Metro Trains Melbourne will be concluding your contract assignment effective 5 August 2016.

You will be paid out the remainder of your contract, to expire 2 September 2016.”

[6] Ms Lonnqvist said she was not paid her entitlements on termination. On 12 August she received one week’s pay for work up to 5 August 2016. She also received a payment of $42.69. She did not receive any further payments until after she lodged her unfair dismissal claim on 25 August 2016. Metro Trains admitted that there had been mistakes made in relation to Ms Lonnqvist’s payments but that was rectified after Ms Lonnqvist raised the failure to pay her in lieu of notice in her unfair dismissal application. Ms Lonnqvist also advised that while her superannuation was normally paid monthly and she had received a superannuation contribution in August based on the monies paid on 5 August 2016, no superannuation contribution had been paid on the further amounts she had been paid.

Consideration

[7] The authorities establish that a contact is not a contract for a specified period of time if either party has an unqualified right to terminate the contract on notice or with payment in lieu of notice. 2 This contract gave Metro Trains the unqualified right to terminate the contract by giving four weeks’ notice. It did not give Metro Trains the right to terminate the contract by payment in lieu of notice. The contract required Metro Trains provide Ms Lonnqvist with four weeks’ notice that her contract would not be renewed.

[8] I therefore conclude that this was not a contract for a specified period of time.

[9] Metro Trains submitted that Ms Lonnqvist could not bring an unfair dismissal claim because Metro Trains chose not to renew Ms Lonnqvist’s employment contract and elected to pay out the remainder of the contracted amount. In effect Metro Trains submitted that Ms Lonnqvist was not terminated at the initiative of the employer. Her employment came to an end at the time specified in the contract.

[10] The Fair Work Act 2009 provides that for there to be a dismissal the employment must be “terminated at the employer’s initiative.”

[11] Therefore to make an unfair dismissal claim Ms Lonnqvist must establish that she had been dismissed on 5 August 2016 or prior to the expiration of her contract on 2 September 2016.

[12] The Explanatory Memorandum states as follows:

“1532. Paragraph 386(2)(a) reflects the common law position that termination in these circumstances would not be a dismissal. The fact that an employment contract may allow for earlier termination would not alter the application of this provision as the employment has terminated at the end of the period, task or season. However, if a person engaged on this sort of contract is terminated prior to the end time specified in the contract, they may seek an unfair dismissal remedy if they satisfy the other requirements.”

[13] The factual issue therefore in dispute is whether Ms Lonnqvist’s employment was terminated on 5 August 2016 or whether she was given notice that her contract would not be renewed and that it would come to an end on 2 September 2016.

[14] Ms Lonnqvist’s evidence was equivocal as she accepted that she was told on 5 August 2016 that her contract would not be renewed. However, it was her evidence that her employment was terminated on 5 August 2016. To support this she points to the failure of Metro Trains to pay her as normal until 2 September 2016 and to pay her superannuation as normal until that date.

[15] Metro Trains called no evidence to support its contention that Ms Lonnqvist continued in employment until 2 September 2016. The letter dated 5 August 2016 did not give Ms Lonnqvist notice that her employment would end at the expiration of the contract. It advised that the contract assignment was to end on 5 August 2016. It is clear that Metro Trains considered that it was entitled to pay Ms Lonnqvist in lieu of notice.

[16] Had Metro Trains either verbally or in writing simply advised Ms Lonnqvist that that her contract would not be renewed and that her employment would come to an end on 2 September 2016 but that she would not be required to attend work until that date, I would have found that the termination of employment was not at the employer’s initiative but arose through the effluxation of time. 3

[17] However, here Metro Trains intended bringing the contract to an end on 5 August 2016 and paying out the contract. As such, the termination was at the initiative of the employer.

[18] This conclusion is supported by Metro Trains’ conduct. Had Ms Lonnqvist remained an employee until 2 September 2016, she would have been paid in accordance with the usual pay cycle and she was not. Had she remained employed up until 2 September 2016, she would have been paid on the expiration of the contract. This did not happen. While it was submitted that this was an administrative oversight what happened was consistent with a finding that Ms Lonnqvist was terminated on 5 August 2016 and it was Metro Trains’ intention to pay her in lieu of notice.

[19] As such, Metro Trains’ objection is dismissed. The application will be referred to arbitration.

DEPUTY PRESIDENT

Appearances:

U. Lonnqvist on her own behalf.

J. Gillam for the Respondent.

Hearing details:

2016.

Melbourne:

14 October.

 1   Exhibit R3

 2 Andersen v Umbakumba Community Council 126 ALR 121

 3   Dr Drummond v Canberra Institute of Technology[2010] FWAFB 5455

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