Xiaoqi Yuan v Winston Group Australia Pty Ltd
[2023] FWC 2124
•12 SEPTEMBER 2023
| [2023] FWC 2124 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Xiaoqi Yuan
v
Winston Group Australia Pty Ltd
(U2023/5784)
| DEPUTY PRESIDENT BELL | MELBOURNE, 12 SEPTEMBER 2023 |
Application for an unfair dismissal remedy - jurisdiction objection - minimum employment period – jurisdiction objection upheld – application dismissed.
Ms Xiaoqi Yuan (applicant) lodged an unfair dismissal claim with the Fair Work Commission (Commission) on 28 June 2023 against Winston Group Australia Pty Ltd (respondent) for an unfair dismissal remedy under s 394 of the Fair Work Act 2009 (Cth) (Act). Ms Yuan began her employment with the respondent on 7 November 2022 and she was dismissed on 27 June 2023.
The issue – the minimum employment period
The respondent operates two accommodation properties in Melbourne under the name ‘Winston Apartments’. The respondent raised an objection to Ms Yuan’s claim, asserting that the respondent was only a ‘small business employer’ and that Ms Yuan had not met the minimum employment period of 12 months.
A person cannot obtain a remedy for unfair dismissal unless they were ‘protected from unfair dismissal’ at the time they were dismissed: s 390(1). An employee is not ‘protected from unfair dismissal’ unless, at the time they were dismissed, they had completed a period of employment with his or her employer of at least the ‘minimum employment period’: s 382(a). For a ‘small business employer’, the minimum period is 12 months. A ‘small business employer’ is an employer that has, at a particular time (in this case, the date of dismissal), fewer than 15 employees.
In this case, it was not in dispute that Ms Yuan was employed for more than 6 months but less than 12 months. The issue in dispute was whether the employer, was a small business employer, i.e., had fewer than 15 employees at the time Ms Yuan was dismissed.
The ‘minimum employment period’ is defined in s 383 of the Act as follows (emphasis added):
“The minimum employment period is:
(a) if the employer is not a small business employer—6 months ending at the earlier of the following times:
(i) the time when the person is given notice of the dismissal;
(ii) immediately before the dismissal; or
(b) if the employer is a small business employer—one year ending at that time.”
A ‘small business employer’ is defined in s 23 of the Act as follows:
“Meaning of small business employer
(1) A national system employer is a small business employer at a particular time if the employer employs fewer than 15 employees at that time.
(2) For the purpose of calculating the number of employees employed by the employer at a particular time:
(a) subject to paragraph (b), all employees employed by the employer at that time are to be counted; and
(b) a casual employee is not to be counted unless, at that time, the employee is a regular casual employee of the employer.
(3) For the purpose of calculating the number of employees employed by the employer at a particular time, associated entities are taken to be one entity.
(4) To avoid doubt, in determining whether a national system employer is a small business employer at a particular time in relation to the dismissal of an employee, or termination of an employee’s employment, the employees that are to be counted include (subject to paragraph (2)(b)):
(a) the employee who is being dismissed or whose employment is being terminated; and
(b) any other employee of the employer who is also being dismissed or whose employment is also being terminated.”
Procedural matters
On 2 August 2023, I issued directions for the filing of evidence and submissions by the parties on the question of whether Ms Yuan had completed the minimum employment period, as well as listing the matter to be heard on 6 September 2023. The directions initially required the respondent to file its material by 16 August 2023 and Ms Yuan by 23 August 2023.
The directions for the filing of evidence were complied with. Ms Yuan’s statement identified four further possible employees, who were not listed or described in the employer’s material: they were two ‘Indian employees’ (whose names Ms Yuan was not sure about), a ‘Chinese housekeeper’ identified as Ms Yang, and an accountant.
In addition, Ms Yuan broadly queried whether the number of housekeepers disclosed was sufficient to clean the rooms required to be cleaned each day in the respondent’s two locations in Melbourne. Ms Yuan’s statement also raised various allegations regarding unpaid superannuation and other matters.
As a result of Ms Yuan’s statement, I directed the respondent to file and serve evidence in reply, which it did so by 23 August 2023. In correspondence giving effect to that direction, I declined Ms Yuan’s request (as I understood her witness statement to include) for the production of documents or information by the respondent. However, so far as Ms Yuan was intending to make a formal request for documents, I indicated it should be made after the respondent’s reply evidence and by no later than 31 August 2023. No such request was ultimately made although at the determinative conference on 6 September 2023, Ms Yuan requested all tax records for employees from the employer. I refused that request, for reasons I will briefly explain below.
I resolved to proceed by way of determinative conference. Mr Rui Jia, Hotel Operator for the respondent, gave evidence for the respondent by witness statement, as well as brief supplementary oral evidence in chief (which leave was granted to provide). He was cross-examined. Ms Yuan gave evidence for herself. She was not cross-examined, although she was given an opportunity to provide further oral evidence about answers that Mr Jia gave in cross-examination and his additional supplementary evidence in chief. The respondent was represented by Sparke Helmore lawyers, with permission for representation having previously been granted. At Ms Yuan’s request, a Mandarin Chinese interpreter was available at the hearing. While I observe that Ms Yuan’s written material in English was of a reasonably high standard, English was not her native language and the interpreter was required for all aspects of the hearing.
Factual findings
A number, but not all, factual matters were either agreed or not challenged.
There was no dispute that Ms Yuan began her employment on 7 November 2022 and she was dismissed on 27 June 2023. She was therefore employed for 7 months and 21 days, a period longer than 6 months but less than 12 months.
Ms Yuan’s role was a housekeeper for the respondent’s Docklands location.
Mr Jia’s first witness statement deposed that, at the date Ms Yuan’s employment was terminated, the respondent employed only 13 people.
Mr Jia’s first witness statement contained a spreadsheet (exhibit “LR-4” to his statement) listing the names of the 13 people employed by the respondent at the two properties. The list in fact had 15 names on it but as Mr Jia explained (and I accept), one of the people on the list only commenced employment on 19 July 2023 and one person was double-counted.
Mr Jia stated that the 13 employees were divided across the respondent’s Docklands and CBD properties with nine employees at Docklands and four employees in the CBD. Of the four people allocated to work in the CBD, I note that LR-4 indicates that only one of those people (Ms Su) was listed as “housekeeping” and, further, that employee was part-time. Of the other three CBD-based employees, were described in LR-4 as working as a “Front desk officer” (each part-time), and one as “Manager” (full-time).
Ms Yuan’s evidence challenged Mr Jia’s conclusion that there were only 13 employees. In summary, she contended:
· There were an additional three “Indian employees” (she did not know their names) working at the Docklands site.
· There was a Chinese housekeeper named Ms Yang, who also worked at the Docklands site.
· There was a company accountant with whom Ms Yuan had some dealings with, and this person was an employee who was not listed in LR-4.
· There must have been more housekeeper employees at the CBD location, because the Docklands location has 35-45 rooms and the CBD location has 25-35 rooms (which Ms Yuan says is “almost fully booked” every day).
In Mr Jia’s second statement, he agreed with Ms Yuan that there were three additional “Indian employees” (whom he listed). However, he said they worked for the respondent “only” in May 2023. Mr Jia produced rosters for May 2023 and June 2023 that supported Mr Jia’s explanation. Mr Jia also gave oral evidence about that matter, which I accept was given honestly and accurately. In short, the last time those three worked for the respondent was in May 2023 and they have not worked again since. None of these three were employees at the time Ms Yuan was dismissed.
For Ms Yang’s engagement, Mr Jia’s statement produced a tax invoice from Ms Yang that was consistent with her being an independent contractor. Mr Jia also provided further oral evidence about the nature of that engagement, which included that she supplied some of her own equipment (a vacuum, mop and some other cleaning equipment), wore her own uniform, is responsible for her own income tax, is not restricted in providing cleaning services elsewhere, and was entitled to delegate her work. No written contract was produced and it does not appear that one exists.
Ms Yuan challenged Mr Jia’s evidence about Ms Yang concerning the wearing of a uniform and the use of equipment. Ms Yuan said that Ms Yang did not wear a uniform and she used equipment supplied by the respondent that was located in an equipment storage cupboard. While I am prepared to accept that Ms Yang did not wear her uniform on occasions and, on other occasions, Ms Yuan had seen Ms Yang use the employer’s equipment, that of itself does not contradict Mr Jia’s evidence (which I also accept on those points).
On balance, I am satisfied that Ms Yang was an independent contractor, not an employee. There is nothing especially unusual about small businesses and sole operators operating as contract cleaners and the evidence before me (including the unchallenged evidence of a right of delegation) points to a conclusion that Ms Yang is, as Mr Jia indicated, an independent contractor.
The question about the accountant is more straightforward. Mr Jia produced a sample invoice from the accountant. From that invoice, it can be seen that the accountant was a proprietary limited company that described its business as tax accountants and advisors. This is an extremely common arrangement. There is simply no reason to doubt that the person working at that firm, but who is the regular contact for advice and assistance for the respondent, is an employee or officer of that firm. They are not an employee of the respondent.
The final matter concerns the number of employees at the respondent’s CBD location.
In this respect, there was some force to Ms Yuan’s criticism that there must have been more people performing housekeeping roles in the CBD location. By comparison, the descriptions for Docklands-based employees in exhibit LR-4 to Mr Jia’s first statement indicated four housekeepers, three front desk officers, one director (being Mr Jia), and one person for whom no information was provided.
However, in his oral evidence (which I accept), Mr Jia explained that one of the people listed as front-desk staff also perform housekeeping work at that location. Even on Ms Yuan’s evidence, the CBD location was smaller than Docklands. While Ms Yuan asserted that it was heavily booked, this was just speculation. Ms Yuan gave no evidence she had been to or worked at the location and, when asked, she was unable to identify any single individual – by broad description or otherwise – from her own observation or even based on what she had been told that would indicate there were any other people working at that location. While Ms Yuan hinted that there were employees paid “cash” (by which I infer undeclared or ‘off the books’) there was simply no evidence at all to support that serious allegation.
At the hearing, Ms Yuan sought to call for “tax” records for the respondent. I refused that request, in part because I had specifically directed her to make any proper request promptly after Mr Jia’s reply evidence was filed (and she did not do so). But I also refused the request because, at its heart, it was no more than a speculative fishing exercise. So much was further confirmed at the hearing, where Ms Yuan was unable to identify a single person from her own knowledge or even based upon what someone else told her who might have worked at the CBD location other than those listed by Mr Jia.
Mr Jia gave sworn evidence that there were no further employees. I accept his evidence.
In those circumstances, I find that the number of employees, including regular casual employees, engaged by the respondent on the date that Ms Yuan was dismissed on 27 June 2023 was no more than 13 employees, including Ms Yuan.
There were no potential associated entities drawn to my attention whose employees might otherwise be counted in addition to the 13 employees identified by Mr Jia.
Finally, I also note that one of the employees on the list in LR-4 was only engaged on 4 June 2023 as a casual. In those circumstances, there is also a serious question as to whether that employee should be counted in the employee headcount as at 27 June 2023 on the basis that she might not be a “regular casual employee” as at that later date. Given the short time that she was employed for at the time of Ms Yuan’s dismissal, I am doubtful that she meets the criteria of a “regular casual employee” but it is unnecessary I decide that matter.
Conclusion
Having found that there were only 13 employees within the meaning of s 23(4) of the Act, it follows that the respondent was a “small business employer” for the purpose of s 23(1) of the Act.
As it was not in dispute that Ms Yuan had not been employed for the “minimum employment period” of 12 months at the time of her dismissal, Ms Yuan was not a person “protected from unfair dismissal” at the time she was dismissed: 390(1).
It follows that the respondent’s jurisdictional objection is upheld and Ms Yuan’s application for an unfair dismissal remedy must be dismissed.
An Order[1] to this effect will be issued in conjunction with this decision.
DEPUTY PRESIDENT
Appearances:
X. Yuan on her own behalf
B. Charles of Sparke Helmore Lawyers for the Respondent
Determinative conference details:
2023.
Melbourne:
September 6.
[1] PR765516
Printed by authority of the Commonwealth Government Printer
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