Yeo and Secretary, Attorney-General's Department
[2020] AATA 117
•3 February 2020
Yeo and Secretary, Attorney-General's Department [2020] AATA 117 (3 February 2020)
Division:GENERAL DIVISION
File Number: 2019/1620
Re:Sheok Kun Yeo
APPLICANT
AndSecretary, Attorney-General's Department
RESPONDENT
DECISION
Tribunal:Senior Member C.J. Furnell
Date:3 February 2020
Place:Melbourne
The decision under review is affirmed.
Senior Member C.J. Furnell
Catchwords
FAIR ENTITLEMENTS GUARANTEE – approbate and reprobate – payment in lieu of notice – redundancy pay entitlement – date of termination – small business exception – decision affirmed.
Legislation
Fair Entitlements Guarantee Act 2012 (Cth)
Fair Work Act 2009 (Cth)
Cases
Gayed and Secretary, Department of Jobs and Small Business [2019] AATA 1132Kable v Secretary, Attorney General’s Dept [2019] AATA 3963
Litster v Forth Dry Dock and Engineering Co Ltd (In Receivership) [1990] 1 AC 546
Mi and Secretary, Department of Employment [2016] AATA 419R v Wang [2007] VSCA 296
Secondary Materials
Halsbury's Laws of Australia Online
REASONS FOR DECISION
Senior Member C.J. Furnell
3 February 2020
On 22 March 2019 the applicant, Mr Yeo, applied to the Tribunal for review of a decision on the amount of an advance for which he was eligible under the Fair Entitlements Guarantee Act 2012 (FEGA).[1]
[1] T1, 1-4; FEGA, s 40
That decision was to the effect that Mr Yeo was entitled under the FEGA to an advance in respect of unpaid wages, annual leave, payment in lieu of notice and long service leave, but not in respect of redundancy pay.[2] It reflected an acceptance of Mr Yeo’s FEGA claim other than in relation to an alleged employment entitlement with respect to redundancy pay.[3] Subject to that exception, there is no challenge to, and I adopt the reasons expressed in support of, that decision.
[2] T9, 103-114
[3] T5
Hence, the question in issue in this proceeding concerns Mr Yeo’s claim to a redundancy pay entitlement. For the reasons that follow I have decided that Mr Yeo is not entitled to redundancy pay.
Before outlining those reasons I should first say something about the factual and legal context in which Mr Yeo’s claim to redundancy pay arose.
FACTUAL AND LEGAL CONTEXT
Mr Yeo was a full time employee of Castel Electronics Pty Ltd (Castel) in the period commencing 18 November 2009[4] (or 26 November 2009[5]) and ending on 25 January 2018. Receivers and managers were appointed to Castel on 25 January 2018[6] and it was one of them who, on that date, terminated Castel’s employment of Mr Yeo.[7] It was also one of them who, on 5 February 2018, certified that Castel’s insolvency was the reason for Mr Yeo’s separation from Castel on 25 January 2018.[8]
[4] T5, 69
[5] T6
[6] T3, 9; T7, 99
[7] T5, 70; T7, 99
[8] T5, 77
Mr Yeo’s termination of employment by reason of Castel’s insolvency attracted the operation of the FEGA.
As an element of its objects, the FEGA provides for the Commonwealth to provide advances on account of unpaid employment entitlements of former employees of employers in cases where, amongst other things, the end of the employment of the former employees was connected with the insolvency or bankruptcy of the employer.[9]
[9] FEGA, s 3
For the purposes of the FEGA, a person’s employment entitlements include his or her redundancy pay entitlement[10] which is, in turn, simply “the amount of redundancy pay the person is entitled to under the governing instrument from the employer for termination of the employment”.[11]
[10] FEGA, s 5
[11] FEGA, s 6(5)
The governing instrument with respect to a person’s employment can include the written law of the Commonwealth if it governs the relevant employment.[12] In relation to Mr Yeo’s employment by Castel, the governing instrument was or included the Fair Work Act 2009 (FWA). It is not contended that any particular award applied to (or governed) Mr Yeo’s employment at the time of his termination.
[12] FEGA, s 5
Castel is or, at least, was a trading or financial corporation formed within the limits of the Commonwealth and, as such, is or was a constitutional corporation under the FWA.[13] Hence, for the purposes of the FWA, Castel was a national system employer[14] and, while employed by Castel, Mr Yeo was a national system employee.[15] As such an employee, the minimum, non-displaceable, National Employment Standards set out in Part 2.2 of the FWA applied to his employment.[16]
[13] FWA, s 12
[14] FWA, s 14
[15] FWA, s 13
[16] FWA, ss 60 and 61
Those National Employment Standards include standards relating to notice of termination and redundancy pay.[17] In particular, pursuant to those standards and as a general rule, an employee is entitled to be paid redundancy pay by his or her employer if the employee’s employment is terminated because of the insolvency or bankruptcy of the employer.[18]
[17] FWA, Part 2.2, Division 11
[18] FWA, s 119
Mr Yeo’s employment by Castel was terminated because of Castel’s insolvency as noted in Castel’s receiver and manager’s certificate of 5 February 2018. (Consistent with this conclusion, on 23 July 2018 it was resolved that Castel be wound up and that a liquidator be appointed to it,[19] and on 1 October 2018 the liquidator reported that Castel’s liabilities exceeded its assets by $11,494,372.[20])
[19] T4,19 - see also T10
[20] T10,115
Despite Mr Yeo’s employment by Castel having been terminated because of Castel’s insolvency, the Respondent submits that Mr Yeo has no redundancy pay entitlement because an exception to the general rule with respect to such entitlements applies in the circumstances. I accept that submission.
SMALL BUSINESS EXCEPTION
The exception relied upon by the Respondent applies if the relevant employer was a “small business employer” at the earlier of the time when the relevant employee was given notice of his or her termination of employment “as described in” s 117(1) of the FWA and the time immediately before the time of the termination.[21] I find that Castel was a small business employer at the relevant time.
[21] FWA, s 121(1)
The relevant time is a time on 25 January 2018.
Mr Yeo’s employment by Castel was terminated at some time on that date. The time immediately before that time was also at some time on that date noting that the “immediately before” expression is one that ordinarily “…involves the notion that there is, between two relevant events, no intervening space, lapse of time or event of significance.”[22]
[22] Litster v Forth Dry Dock and Engineering Co Ltd (In Receivership)[1990] 1 AC 546 at 569 cited in Mi and Secretary, Department of Employment [2016] AATA 419 at [18]
Mr Yeo was given notice of his termination of employment by Castel in accordance with s 117(1) of the FWA by way of a letter dated 25 January 2018 from a Mr Bellamy, as receiver and manager of Castel, addressed to “employee creditors”.[23] In an email of 14 September 2018 Mr Yeo acknowledged his receipt of that letter on 25 January 2018.[24]
[23] T7, 99
[24] T7, 97
Mr Yeo claims, however, to have been given notice of termination of his employment by Castel in early November 2017. The executive director of Castel is said to have then told Mr Yeo that it had been decided to cease Castel’s business operations by early March 2018. That director is also said by Mr Yeo to have asked Mr Yeo around mid-November 2017 to stay with Castel until early March 2018 to help with the orderly run down of its business.[25]
[25] See Mr Yeo’s request of 18 October 2018 for an internal review of the decision under review - T11, 138
I accept that in November 2017 Mr Yeo was, in effect, orally informed that his employment with Castel would terminate sometime in early March 2018. I do not accept, however, that his being so informed bears upon the time by reference to which the applicability of the small business exception is, in the circumstances, required to be assessed.
The meaning of the language of the relevant FWA provisions is unambiguous.[26] Given that meaning, what occurred in November 2017 did not constitute the giving of notice of Mr Yeo’s termination of employment “as described in” s 117(1) of the FWA. There “….is no scope for the Tribunal to determine that a date should be used to calculate benefits which is different from the actual date of the applicant’s termination.”[27]
[26] Mi and Secretary, Department of Employment [2016] AATA 419 at [23]; Gayed and Secretary, Department of Jobs and Small Business [2019] AATA 1132 at [42]
[27] Kable v Secretary, Attorney General’s Dept [2019] AATA 3963 at [37]
Two elements of the notice of termination described in s 117(1) of the FWA are not present in the events that Mr Yeo claims to have occurred in November 2017.
First, the notice described in s 117(1) is one that is written. The section does not describe oral notice. Second, the notice described in s 117(1) is one that identifies the day of termination of employment. The section does not describe a notice of employment termination that is to occur at some time in a particular month.
A conclusion that Mr Yeo was not given notice of termination of his employment by Castel as described in s 117(1) of the FWA before 25 January 2018 is consistent with the approach he initially took to his claim for an advance under the FEGA. In the claim he made under the FEGA he stated that he had not been given a notice of termination prior to his last day of work for Castel (which he specified in the claim as being 25 January 2018).[28] Further, in an email of 14 September 2018 Mr Yeo was asked whether, leading up to his termination on 25 January 2018, he was notified that he was going to be terminated. In a responding email of that date Mr Yeo stated that “[t]here was no indication or notice prior to my termination on 25 January 2018.”[29]
[28] T5, 70
[29] T7, 97
A conclusion that Mr Yeo was not given notice of termination of his employment by Castel as described in s 117(1) of the FWA before 25 January 2018 is also consistent with his successful claim to an advance calculated by reference to a payment in lieu of notice entitlement (an entitlement which arises only when there has been a shortfall in the period of notice of termination[30]).
[30] FEGA, s 6(4)
In making and benefitting from that claim Mr Yeo would seem to have elected to treat the notice of termination of his employment as being the notice given to him on 25 January 2018 rather than any notice given in November 2017. As a result, Mr Yeo might well now be disentitled from contending that this was not the case, albeit that it is unnecessary for me to decide whether he is so disentitled. In this regard, a “… person may not ‘ approbate and reprobate’, meaning that a person, having a choice between two inconsistent courses of conduct and having chosen one, is treated as having made an election from which he or she cannot resile once he or she has taken some benefit from the chosen course.”[31]
[31] Halsbury's Laws of Australia- at 190-35 - as published online as at 31 January 2020. See, for example, R v Wang [2007] VSCA 296 at [58]
If, as I have concluded, the relevant time is a time that occurred on 25 January 2018, was Castel then a small business employer? I find that it was.
As reported by Castel’s liquidator on 1 October 2018, on 25 January 2018 Castel had 14 employees.[32] At the hearing of this proceeding, Mr Yeo does not dispute this.[33]
[32] T10,119
[33] See also his request of 18 October 2018 for an internal review of the decision under review in which no objection is taken to the calculation of the number of Castel’s employees on 25 January 2018 - T11,138
DECISION
As Castel had less than 15 employees on 25 January 2018 it was then a small business employer for the purposes of the FWA.[34] As such, at the relevant time (a time on 25 January 2018), Mr Yeo has no redundancy pay entitlement in relation to the termination of his employment by Castel; he has no entitlement to an amount of redundancy pay under the governing instrument applicable to that employment (the FWA).
[34] FWA, s 23(1)
Hence, as reflected in the decision under review, it was correct to calculate the amount of the advance made to Mr Yeo under the FEGA without regard to any entitlement to redundancy pay.
Accordingly, I have decided to affirm the decision under review.
I certify that the preceding 30 (thirty) paragraphs are a true copy of the reasons for the decision herein of Senior Member C.J. Furnell
[sgd]........................................................................
Associate
Dated: 3 February 2020
Date of hearing: 3 February 2020 Applicant: In person Advocate for the Respondent: Ms Katherine Cooke Solicitors for the Respondent: HWL Ebsworth Lawyers
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