Yammouni v Therexa Pty Ltd ATF the Heath Family Trust Trading as Activate Physiotherapy and Clinical Pilates

[2020] FCCA 1170

FEDERAL CIRCUIT COURT OF AUSTRALIA

YAMMOUNI v THEREXA PTY LTD ATF THE HEATH FAMILY TRUST TRADING AS ACTIVATE PHYSIOTHERAPY & CLINICAL PILATES [2020] FCCA 1170

Catchwords:
INDUSTRIAL LAW – Small Claims Division – whether the applicant is owed redundancy pay – whether the respondent was permitted to make deductions from final pay – application partially successful.

Legislation:

Fair Work Act 2009 (Cth), ss.121, 324, 341, 358, 370, 548

Federal Circuit Court Rules 2001 (Cth), r.2.05

Applicant: LAURA YAMMOUNI

Respondent: THEREXA PTY LTD ATF THE HEATH FAMILY TRUST T/A ACTIVATE PHYSIOTHERAPY & CLINICAL PILATES

File Number: PEG 199 of 2019

Judgment of: Judge Kendall

Hearing date: On the Papers

Date of Last Submission: 11 May 2020

Delivered at: Perth

Delivered on: 15 May 2020

REPRESENTATION

Applicant: In person

Respondent: Mr B Heath

ORDERS

1. The respondent pay the applicant $1,126.12 within 28 days of the date of these orders.

2. The application otherwise be dismissed.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT PERTH

PEG 199 of 2019

LAURA YAMMOUNI

Applicant

And

THEREXA PTY LTD ATF THE HEATH FAMILY TRUST T/A ACTIVATE PHYSIOTHERAPY & CLINICAL PILATES

Respondent

REASONS FOR JUDGMENT

Introduction

1. On 31 May 2019, the applicant filed an application in this Court seeking relief in the Court’s small claims jurisdiction under s.548 of the Fair Work Act 2009 (Cth) (the “FW Act”).

2. The parties first appeared before the Court on 15 August 2019. On that occasion the applicant was advised that she should seek legal assistance regarding the relief she was claiming in her application.

3. On 20 September 2019, the applicant filed an amended application. In that amended application she seeks compensation in the sum of $4,614.55 (consisting of unpaid annual leave, redundancy pay and “withheld training costs”).

4. On 7 October 2019, the respondent filed a response denying that any monies were owed to the applicant.

5. The matter was referred to mediation. Unfortunately, the mediation was unsuccessful.

6. The parties have now asked that the Court determine the substantive application on the papers and without an oral hearing.

7. Orders were made to that effect, allowing the parties to file any evidence and submissions.

8. The Court has considered the following materials in determining this application:

   a)the applicant’s application dated 20 September 2019;

   b)the respondent’s response dated 7 October 2019;

   c)the affidavit of Laura Yammouni sworn 12 March 2020;

   d)the affidavit of Ben Heath dated 9 April 2020; and

   e)written submissions from the respondent filed on 11 May 2020 (these written submissions were filed late – an issue discussed below).

Small Claims Jurisdiction

1. Neither party has argued that this matter should not be determined in the Court’s small claims jurisdiction.  The Court proceeds on that basis.

2. Section 548 of the FW Act provides:

   (1)  Proceedings are to be dealt with as small claims proceedings under this section if:

   (a)  a person applies for an order (other than a pecuniary penalty order) under Division 2 from a Magistrates court or the Federal Circuit Court; and

   (b)  the order relates to an amount referred to in subsection (1A); and

   (c)   the person indicates, in a manner prescribed by the regulations or by the rules of the court, that he or she wants the small claims procedure to apply to the proceedings.

   (1A)  The amounts are as follows:

   (a)  an amount that an employer was required to pay to, or on behalf of, an employee:

   (i)     under this Act or a fair work instrument; or

   (ii)    because of a safety net contractual entitlement; or

   (iii)  because of an entitlement of the employee arising under subsection 542(1);

   (b)  an amount that an outworker entity was required to pay to, or on behalf of, an outworker under a modern award.

   Limits on award

   (2)  In small claims proceedings, the court may not award more than:

   (a)  $20,000; or

   (b)  if a higher amount is prescribed by the regulations--that higher amount.

   Procedure

   (3)  In small claims proceedings, the court is not bound by any rules of evidence and procedure and may act:

   (a)  in an informal manner; and

   (b)  without regard to legal forms and technicalities.

   (4)  At any stage of the small claims proceedings, the court may amend the papers commencing the proceedings if sufficient notice is given to any party adversely affected by the amendment.

   Legal representation

   (5)  A party to small claims proceedings may be represented in the proceedings by a lawyer only with the leave of the court.

3. Section 548(3) of the FW Act dispenses with many of the usual complexities that would arise in litigation (such as evidentiary objections) and provides the Court with considerable flexibility when determining what weight to afford to the evidence before it.

4. This should not be seen as suggesting that the Court will accept the most whimsical of evidence without reason and reject probative evidence out of hand. Rather, a reasoned approach is taken, bearing in mind that the parties to these proceedings are usually unrepresented.

Applicant’s Claim

1. The amended application as filed by the applicant contains a statement detailing her claim. This statement was also annexed to her affidavit. Relevantly, that statement provides:

   Background - Employment agreement

   3 On or about 5 September 2017 Activate employed Laura as a physiotherapist.

   PARTICULARS

   The employment agreement was partly oral and partly to be inferred.

   Insofar as it was oral, it was constituted by discussions between Laura and Mr. Ben Heath, a director of Activate, on or about 5 September 2017 to the effect alleged.

   Insofar as it is to be inferred, it should be inferred from the following circumstances:

   (a)    After 5 September 2017, Laura attended Activate’s premises between 8am and 5pm on each Monday, Tuesday and Thursday;

   (b)    Laura saw patients booked for her by Activate;

   (c)     Activate charged those patients fees and paid a regular salary to Laura and made contributions to Laura’s nominated superannuation fund; and

   (d)    from time to time, Laura took paid sick, annual and carer’s leave.

   4 There were terms of Laura’s employment including that:

   (a)    Laura’s hours of work were 8am until 5pm on Monday, Tuesday and Thursday; and

   (b)    Laura was not required to work on weekends or after hours due to her parental responsibilities.

   Background - Planned maternity leave

   5 On 8 March 2018:

   (a)Laura informed Activate that she was pregnant and that she planned to take maternity leave from mid-September 2018 until mid-January 2019, at which time she would return to work; and

   (b) Activate requested, and Laura agreed to continue working until the end of August 2018, to accommodate Activate’s staffing requirements.

   PARTICULARS

   Laura informed Activate orally in a discussion with Mr Heath on or about 8 March 2018 to the effect alleged.

   Background - Purported termination and request to work after-hours and/or on weekends

   6 As per Annexure B PN111, on 14 June 2018 Activate purported to terminate Laura’s employment on the ground that her recurrent patient numbers were lower than the average across the clinic and, as a result, Activate could not afford to continue to pay her “as an employee”.

   PARTICULARS

   The purported termination was oral and occurred in a discussion between Laura and Mr Heath on or about 14 June 2018 to the effect alleged.

   Further on 14 June 2018, Activate advised that had Laura worked after-hours and/or on weekends in order to improve her recurrent patient numbers and thereby increase the amount of her billings there would have been no issue.

   Activate’s request was oral and occurred in a discussion between Laura and Mr Heath on or about 14 June 2018 to the effect alleged.

   Background - Purported offer to continue as a contractor

   7 As per Annexure C, on 15 June 2018 Activate offered to engage Laura as an independent contractor after the conclusion of her four-week notice period (ie, 12 July 2018) upon terms that:

   (a) She could schedule and see patients at mutually convenient times with no obligation to see a certain number of patients in the clinic for a minimum number of hours; and

   (b) Activate would pay her 50% of her billings.

   (c) Activate would provide a Contractors agreement for Laura outlining: insurance, the use of treatment aids, consumables and how patients would be booked.

   (d) The terms although vague were given verbally and confirmed through Mr Heaths testimony in Annexure B PN 111 and PN 118-119.

   8 On or around the 15 June 2018 in a conversation with Mr. Heath it was verbally agreed that Laura would continue to work as an employee until the details of her new employment were finalised.

   PARTICULARS

   Some of the particulars of Activate’s offer were conveyed in writing and contained in an email from Mr Heath to Laura dated 15 June 2018, contained in Annexure C.

   Activate assured Laura that a contract to outline her responsibilities would be provided and also promised she may work the same hours if that suited her.

   Laura, awaiting her contact, continued to work as a salaried employee.

   Background - Withholding of Training Costs

   9 After the email of notice of 4 weeks had been given to Laura, a payslip detailing her final pay was provided attached in Annexure D.

   10 On or about 8 July 2018, Laura had still not received her final payment as outlined in her payslip; when questioned Activate advised that they would be withholding training costs and that they would provide a new payslip.

   PARTICULARS

   Activate did not issue a new payslip until a general protection case was lodged at FWA. Activate refused to discuss or negotiate training costs that were deducted without consent. Activate paid the amended payslip after the lodgement of paperwork with FWA and has provided no other remittance. Annexure E shows the amended pay slip.

   Claim - Redundancy Pay

   11 In the premises of paragraphs 6, 7 and 8 above, Activate made an offer for Laura to continue to work as a contractor contradicting Section 358 of the FW Act in that it took adverse action purporting to terminate Laura’s employment and/or altering Laura’s position to her prejudice.

   12 As per Annexure B PN113 Activate did not finalise the contractor arrangement with Laura and left her in a precarious position, with no understanding of her rights, liability to the clinic and patients or what her terms of employment would be.

   PARTICULARS

   The fact that Activate required Laura to conform with the rules of her previous employment arrangement is to be inferred from:

   (a) Laura was required to wear the Activate uniform.

   (b) Activate managed her patient roster.

   (c) Activate collected all billings from clients.

   (d) Activate provided all treatment materials and equipment.

   (e) Activate was to provide an independent contract but failed to do so.

   (f) Laura never provided an ABN and verbally advised Activate that until it was provided, she would not agree to a change in employment agreement.

   13 In the premises of paragraph 8, Activate contravened Section 358 of the Fair Work Act 2009 (Cth) (FW Act) in that:

   (a) Laura acted in the manner of an employee; and

   (b) Activate took adverse action (by terminating Laura’s employment) after they failed to provide Laura with a contractor’s agreement.

   14 Without a new contract and without a finalised agreement for the variation and change in working conditions, Laura’s employment contract was not altered with Activate.

   15 Activate are liable to pay a 4 weeks’ notice redundancy period from 12 July 2018 to her last date of employment.

   Claim - Annual Leave

   16 The four weeks redundancy period, annual leave and benefits as outlined in the attached compensation claim are claimed for this period attached in Annexure A.

   Claim - Withholding of training costs

   17 In the premises of paragraph 7, 8 and 10, Activate deducted training costs based on the change of employment that they had forced Laura to accept in that:

   (a) Activate deducted without authority or consent of Laura the costs associated with a training course attended by Laura to the benefit of Activate and their Clients.

   (b) This course was for the benefit of Activate to allow Laura to cover additional classes for other employees.

   18 In the premises of paragraph 8 and 10, Laura had no remedy or ability to dispute the adverse action taken. When she attempted to do so, Activate terminated her employment, removing her ability to earn an income.

   19 As per Annexure B PN173-174, Laura was not paid the remainder of her salary until after she lodged her Unfair Dismissal Claim with FWA.

   20 As per Annexure B PN 174, Mr Heath has admitted he has not made any attempts to settle this matter with Laura.

2. Annexed to the applicant’s affidavit was a breakdown of the amount the applicant claims she is owed, a transcript of proceedings before the Fair Work Commission (concerning an unfair dismissal application lodged by the applicant against the respondent), an email from the respondent to the applicant dated 15 June 2018 and two payslips.

3. In the Form 5 (the form used to commence the proceeding), the applicant makes a claim that the respondent breached the National Employment Standards relating to “maternity and parental leave” and “notice and final pay”. She also alleges a breach of the apparent relevant award – the Health Professionals and Support Services Award 2010 (the “Award”).

Respondent’s Response

1. The respondent’s response dated 8 October 2019 admitted some aspects of the applicant’s claims and denied other aspects. Specifically:

   a)it was said that the applicant commenced employment on 18 October 2017 pursuant to a written contract;

   b)the respondent provided the applicant with four weeks’ notice on 14 June 2018 that her employment was to be terminated;

   c)upon being advised of her termination, the applicant and the respondent orally discussed a concept proposed by the applicant that the applicant rent the respondent’s rooms from time to time in the future for the applicant to treat “FitRight” patients. The applicant would pay the respondent rent equivalent to fifty percent of the applicant’s gross billings. On 31 July 2018, the respondent withdrew its consent to this arrangement;

   d)the respondent did not dismiss the applicant in order to engage her as an independent contractor. The reason the applicant was dismissed was her performance, conduct and competence; and

   e)other than the disputed amount regarding training costs, the applicant has been paid all of her entitlements.

2. The response also contains the following paragraphs:

   1)Training costs withheld from final pay. As discussed above, if it is the view of the court that the respondent was incorrect to obtain repayment in this manner, the respondent is happy to return the amount deducted and wishes to file a counter claim against the applicant for repayment of the full cost of training as per the signed agreement (Annexure C) such claim to be determined concurrently by the court.

   2)The applicant has failed to return 2 x embroidered polo shirts which were provided at a cost of $65 each. We ask for an order for either immediate return of the above or payment to the respondent of $130.

3. An affidavit of Ben Heath dated 9 April 2020 was also received by the Court. 

4. An email was received from the applicant on 14 April 2020 that addresses that affidavit.  It provides:

   Your Honour,

   This affidavit has been filed outside of the time frame set out by your previous order.

   This is again another example of Mr Heath being unable to follow direction and to draw out this process.

   I ask that this affidavit be inadmissible in this case.

5. The respondent was required to file and serve his affidavit evidence by 9 April 2020. The Court record indicates that the respondent did file the affidavit on 9 April 2020 at 4.37pm.

6. Any documents filed after 4.30pm are, in accordance with the Court’s Rules, deemed to have been filed on the next day the Registry was open for business: Federal Circuit Court Rules 2001 (Cth) r.2.05(3)(b). As the respondent’s affidavit was filed 7 minutes after the cut-off time, it was not deemed to have been filed, technically, until 14 April 2020 (as the Easter Long Weekend meant that the Registry was closed for four days). The respondent served the affidavit upon it being sealed by the Court. However, it was 4 days late.

7. As per s.548(3) of the FW Act, the Court may act in an informal manner and, in particular, without regard to procedural technicalities. Here, the Court is not prepared to find that respondent’s affidavit was “inadmissible”. The respondent did, in an everyday sense, file the document in the time required by the orders. It is a legal technicality that now finds the affidavit to have been filed “late”. The Court does not accept that this is but “another example” of the respondent being unable to follow directions.

8. Nor can it be said that a delay of four days is evidence of the respondent attempting to “draw out the process”. Indeed, the parties were not due to file submissions until 7 May 2020.  Hence, judgment could not be delivered until after that date in any event. The applicant did not claim that she was prejudiced by the four-day delay in receiving the affidavit. Further, the Court is not satisfied that she was in any way prejudiced as she still had at least three weeks to prepare her submissions after receiving the affidavit in question.

9. The Court accepts Mr Heath’s affidavit dated 9 April 2020 and notes that it relevantly provides:

   1. Laura Yammouni commenced employment at Activate Physio on 18 October 2017 (Annexure A - employment contract).

   2. Laura’s employment contract was terminated on the 14th June 2018. This was the result of poor patient retention, performance and competence issues. Activate Physio was a small business employer with 11 staff and Laura had worked for Activate for just under 9 months.

   3. 4 weeks notice of termination was provided to the applicant (as detailed in Annexure F) and the applicant worked the entirety of her 4 weeks notice period.

   4. At the conclusion of her employment on 12th July 2018 (termination date) a final payslip was issued and balance of leave entitlements was paid out (Annexure B: Evidence of final payslip).

   5. Mrs Yammouni’s final payslip for the pay period 2/7/18 -15/7/18 consisted of:

   Ordinary hours worked :36 hours

   Annual Leave: 8 hours

   Sick Leave : 4 hours

   Balance of Annual leave entitlements paid out : 12.33 hours

   Less deduction for training cost.

   6. Other than the disputed amount in relation to the training agreement, the applicant has been paid all of her entitlements inclusive of superannuation. There are no other amounts owing to the applicant.

   7. The applicant’s position was never made redundant and came at a difficult time for me personally. I had just welcomed my 6th child and had hoped to have time off which was then impossible.

   8. The Applicants employment relationship ended on 12 July 2018. Informal discussions were had regarding potentially hiring a room after this date to conduct a few sessions until the birth of her child. These remained informal. There was no agreement between the parties to modify the termination of Laura’s employment.

   …

   9. Attached is the training costs agreement which is signed by the applicant (Annexure C). As a working small business owner without the benefit of in-house HR expertise, the respondent researched and applied an appropriate training agreement. The repayment deduction was made in accordance with the terms of this agreement.

   COUNTER CLAIM - Training costs withheld from final pay.

   10. If it is the view of the court that the respondent was incorrect to obtain repayment in this manner, the respondent will return the amount deducted and wishes to file a counter claim against the applicant for repayment of the full cost of training ($1638) as per the signed agreement (Annexure C) such claim to be determined concurrently by the court.

1. Annexed to Mr Heath’s affidavit is an unsigned employment contract between the applicant and the respondent, a signed training costs agreement, the applicant’s final payslip, bank records and email correspondence exchanged between the applicant and Mr Heath following the termination.

2. The respondent filed written submissions on 11 May 2020. Those submissions were filed outside the time for compliance with the Court’s orders. Notwithstanding that non-compliance, the Court has considered the submissions where necessary.

3. The Court notes that in those submissions, Mr Heath states that, as he was not in attendance (by no fault of his own) when the Court made orders on 13 February 2020, he did not know what evidence he needed in order to properly defend his claim. To clarify, the Court did not provide any assistance on 13 February 2020 in relation to what documents should or should not be filed in relation to the substantive claim (in the sense of what would or would not prove/disprove the claim). The Court simply outlined the time within which any documents the parties wanted to put before the Court should be filed. While the Court will do what it can to assist unrepresented parties, the Court will not provide legal advice and will not advise the parties what evidence will or will not assist their position.

Consideration

1. In effect, two claims arise in this matter:

   a)what the Court will call the “redundancy claim”, in which the applicant alleges that she continued in an employee-employer relationship with the respondent until 12 July 2018 and, as such, is owed four weeks redundancy pay and the equivalent annual leave for that period; and

   b)what the Court will call the “training costs claim”, in which the applicant claims that the training costs should not have been deducted from her final pay.

2. In his affidavit, Mr Heath also raises what he calls a “counter claim” in relation to the “training costs claim”.  The Court will address this issue below.

3. As the applicant has not made any submissions or produced any evidence in relation to the “maternity/parental leave” matters and the matters relating to the relevant Award, the Court will not consider these issues. Further, to the extent that reference is made to s.341(1)(a) of the FW Act, the jurisdictional requirements (i.e., a certificate from the Fair Work Commission that is lodged in accordance with s.370 of the FW Act) have not been met. As such, the Court will not consider this issue either.

The Redundancy Claim

1. The applicant claims that the respondent acted in breach of s.358 of the FW Act, which relevantly provides:

   An employer must not dismiss, or threaten to dismiss, an individual who:

   (a)is an employee of the employer; and

   (b)performs particular work for the employer;

   in order to engage the individual as an independent contractor to perform the same, or substantially the same, work under a contract for services.

2. It is not strictly necessary for the Court to determine whether any breach has arisen here. This is not a general protections claim. The essence of the claim is that, following the alleged termination of the applicant, she continued in an employment relationship as opposed to an independent contractor relationship and is entitled to four weeks redundancy pay from 12 July 2018 and the equivalent annual leave for that period.

3. The applicant’s claim is not entirely clear. She refers to “notice/final pay”. To the extent that the applicant is suggesting that she was entitled to four weeks’ notice pay after 12 July 2018, the Court does not understand the basis of this claim. The applicant herself identifies in her Form 5 that her last day of employment was 12 July 2018. She is not entitled to four weeks’ notice pay after this date when she was given four weeks’ notice on 14 June 2018 that she was being terminated. The applicant worked throughout her notice period and was paid for this work. She is not entitled to a further four weeks payment in lieu of notice.

4. Turning to the redundancy aspect of the claim, it is unnecessary for the Court to consider whether the applicant was “employed” or “contracted” by the respondent following her purported termination. This is so because, having reviewed each of the materials, s.121 of the FW Act excludes the respondent from having to make any redundancy payments even if she was an employee.

5. Section 121 of the FW Act states:

   (1)  Section 119 does not apply to the termination of an employee’s employment if, immediately before the time of the termination, or at the time when the person was given notice of the termination as described in subsection 117(1) (whichever happened first):

   (a)  the employee’s period of continuous service with the employer is less than 12 months; or

   (b)  the employer is a small business employer.

6. The applicant states that she commenced employment on 5 September 2017. Mr Heath states that the applicant commenced employment on 17 October 2017. The unsigned employment agreement states that the applicant would commence employment in “Late September 2017”.

7. It does not appear to be in dispute that the respondent provided the applicant notice of termination on 14 June 2018: Applicant’s Affidavit at [7] and [9]. The conclusion of the applicant’s employment was 12 July 2018: Mr Heath’s Affidavit at [4] and [8]; Applicant’s Affidavit at [7]. In the applicant’s Form 5 she herself stated that her last day of employment was 12 July 2018.

8. In any event, even if 12 July 2018 was not the final day of employment or engagement, the evidence shows that the applicant’s “last day” (as an employee or not) was going to be 16 August 2018: Mr Heaths Affidavit, Annexure F1. The applicant’s employment period was, on the most favourable view, less than 12 months in duration. As such, she is not entitled to any redundancy pay: FW Act, s.121(1)(a).

9. Mr Heath also makes the remark that he is a “small business employer”. Mr Heath states that the respondent employs 11 staff. “Small business employer” is defined in s.23 of the FW Act as follows:

   (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.

10. On Mr Heath’s evidence, the respondent fits this definition. The Court does not consider it implausible or far-fetched that a physiotherapy and clinical Pilates business would employee less than 15 persons.

11. On the basis of the above, the respondent is not liable to pay redundancy pay to the applicant as she claims. It follows that the claim for annual leave for that period of redundancy pay must also fail.

The “Training Costs” Claim

1. It is not disputed that the respondent deducted $1,126.12 from the applicant’s final pay for “training costs”. The applicant says that this was done without her consent. The respondent, in turn, states that if it was not entitled to deduct the amount it will repay the applicant in full. However, the respondent then “counterclaims” for payment by the applicant of the full training cost amount, being $1,638.80.

2. The training costs relate to a Pilates training and development course undertaken by the applicant.

3. The applicant and respondent signed a “Training Costs Agreement” on 23 November 2017. Relevantly, the Training Costs Agreement contained the following terms:

   IT IS HEREBY AGREED AND DECLARED THAT

   1. In consideration of the Employer meeting the costs of the Course which are set out in the Schedule to this Agreement (“the Costs”), the Employee undertakes to reimburse to the Employer the Costs if:

   …

   (iii) he/she resigns from the employment of the Employer or his/her employment is otherwise terminated within two years after the completion of the course.

   2. To the extent permitted by law, the Employee agrees to that the Employer may deduct a sum equal to the whole part of the Costs due in accordance with Clause 1(iii) under the terms of this Agreement from his/her wages (as defined in Section 27 of the Employment Rights Act 1996) or from any other allowances, expenses or other payments due to the Employee.

   3. The amount due to the Employer under the terms of this Agreement is a genuine attempt by the Employer to assess its loss as a result of the termination of the Employee’s employment and takes into account the derived benefit to the Employer. This Agreement is not intended to act as a penalty on the Employee upon termination of his/her agreement.

4. Unusually, this agreement refers to the United Kingdom’s Employment Rights Act 1996. While “problematic”, it is noted that cl.2 of the agreement states that “[to] the extent permitted by law”. In the circumstances, the Court considers the Training Costs Agreement to be applicable to “the extent permitted by” any relevant Australian legislation such as the FW Act.

5. For the purposes of the applicant’s claim, s.324 of the FW Act is relevant. It provides:

   324 Permitted deductions

   (1)  An employer may deduct an amount from an amount payable to an employee in accordance with subsection 323(1) if:

   (a)  the deduction is authorised in writing by the employee and is principally for the employee’s benefit; or

   (b)  the deduction is authorised by the employee in accordance with an enterprise agreement; or

   (c)   the deduction is authorised by or under a modern award or an FWC order; or

   (d)  the deduction is authorised by or under a law of the Commonwealth, a State or a Territory, or an order of a court.

   …

   (2) An authorisation for the purposes of paragraph (1)(a):

   (a) must specify the amount of the deduction; and

   (b)may be withdrawn in writing by the employee at any time.

6. There is no evidence of an entitlement to deduct training costs arising from the Award or any enterprise agreement.

7. There is no doubt that the Training Costs Agreement makes it clear that the deduction for training costs from the applicant’s final pay was something that was agreed to. It was in writing. Therefore, the first aspect of s.324(1)(a) is satisfied. However, the second aspect of s.324(1)(a) is a requirement that the deduction be “principally for the employee’s benefit”. The respondent will only be entitled to deduct the amount of $1,126.12 if both of these aspects are satisfied.

8. Clause 3 of the Training Costs Agreement does not assist the Court in determining whether the deduction was “principally for the benefit of the applicant”.

9. The applicant claims that the training course was undertaken for the benefit of the respondent as it would allow the applicant to cover additional classes for other employees. In written submissions, the respondent states that the course was not “compulsory” and the applicant entered into the Training Costs Agreement voluntarily. It is further stated that the course would “assist in Laura’s employment prospects in the future”.

10. The Training Costs Agreement states that the “Employer”, being the respondent, had “booked a place for the Employee in relation to training and development in Clinical Pilates”. While the course was “not compulsory”, this still suggests that it was on the respondent’s own motion that the applicant undertake the course. The Court accepts the applicant’s evidence that the course was taken so that she could “cover” for other employees. The course related to Clinical Pilates. On the evidence before the Court, the applicant was employed as a physiotherapist.  There is nothing to suggest that this course was relevant to the applicant’s duties as a physiotherapist.

11. While the respondent states that the course was not “compulsory”, on the evidence before the Court, it is clear that the applicant took the course in order to be able to offer an additional service on behalf of the respondent and to “cover classes” for other employees who worked for the respondent. The respondent states that the course has “significant value and will assist in Laura’s employment prospects in the future”. However, there is nothing before the Court to explain how or why this is the case (such as whether the applicant has promoted herself as having undertaken this course). The Court is not prepared to hypothesise in this regard.

12. On the balance of probabilities, the Court is of the view that the course which the applicant undertook was not “principally for the benefit” of the applicant as is required in s.324(1)(a). Here, the person who stood to benefit was the respondent.

13. In these circumstances, the respondent had no legal right to deduct the amount of $1,126.12 from the applicant’s pay.

The Counter Claim

1. In his affidavit, Mr Heath states that, in the event the Court finds that the respondent was not entitled to deduct the training costs from the applicant’s final pay, the respondent “counter claims” that the applicant owes the respondent the full amount of the training costs as per the Training Costs Agreement.

2. Given that the Court has found that the respondent was not entitled to deduct the training costs there is no basis upon which the counterclaim can succeed. The respondent is simply “re-naming” his defence and the request made has no merit. 

3. The counterclaim is dismissed in relation to the training costs. 

4. The counterclaim as articulated in the affidavit does not seek the cost of the two embroidered polo shirts valued at $65 each. The Court assumes that that request is no longer pressed.  In any event, without affidavit evidence to that effect there is simply no evidence to support that part of the counterclaim.  That part of the claim is thus refused.

Conclusion

1. The applicant has not satisfied the Court that she is entitled to any further payments from the respondent. She is, however, entitled to be paid $1,126.12 – an amount wrongly withheld from her final pay. An order will be made to that effect.

1. As the applicant was unsuccessful in part of her claim (namely, the redundancy claim) the Court will order that the application otherwise be dismissed.

I certify that the preceding sixty (60) paragraphs are a true copy of the reasons for judgment of Judge Kendall

Associate: 

Date: 15 May 2020