DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

Elizabeth McCallum
v
Everstone Pty Ltd
(U2021/6660)

Application for an unfair dismissal remedy – jurisdictional objection that minimum employment period not met – jurisdictional objection dismissed.

[1] On 28 July 2021, Ms Elizabeth McCallum (Applicant) applied to the Fair Work Commission (Commission) for an unfair dismissal remedy under Part 3-2 of the Fair Work Act 2009 (Cth) (FW Act), in relation to the termination of her employment with Everstone Pty Ltd (Respondent).

[2] The Respondent objected to the application on the basis that the Applicant had not met the minimum employment period to be protected from unfair dismissal. I heard the parties in relation to this jurisdictional objection on 15 October 2021.

When a person is protected from unfair dismissal

[3] Section 382 of the FW Act provides a person is protected from unfair dismissal at a time if, at that time:

(a) the person is an employee who had completed a period of employment with his or her employer of at least the minimum employment period; and

(b) one or more of the following apply:

(i) a modern award covers the person;

(ii) an enterprise agreement applies to the person in relation to the employment;

(iii) the sum of the person’s annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold.

[4] Section 383 of the FW Act provides that 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.

[5] Section 23 of the FW Act provides:

(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 purposes of calculating the number of employees employed by the employer at a particular rime:

(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, he or she has been employed by the employer on a regular and systematic basis.

(3) For the purpose or 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.

[6] Section 384 of the FW Act provides:

(1) An employee’s minimum period of employment with an employer at a particular time is the period of continuous service the employee has completed with the employer at that time as employee.

(2) However:

(a) a period of service as a casual employee does not count towards the employee’s period of employment unless:

(i) the employment as a casual employee was as a regular casual employee; and

(ii) during the period of service as a casual employee, the employee had a reasonable expectation of continuing employment by the employer on a regular and systematic basis; and

(b) if:

(i) the employee is a transferring employee in relation to a transfer of business from an old employer to a new employer; and

(ii) the old employer and the new employer are not associated entities when the employee becomes employed by the new employer; and

(iii) the new employer informed the employee in writing before the new employment started that a period of service with the old employer would not be recognised;

the period of service with the old employer does not count towards the employee’s period of employment with the new employer.

Background

[7] The uncontested factual background to the matter is as follows:

•  The Applicant was dismissed from her employment by the Respondent on 7 July 2021. 1

•  The Applicant’s was paid $1,155 per week at time of her dismissal. 2

•  The Respondent employed 15 or more employees at the time the Applicant was dismissed. 3

The conference

[8] The Applicant stated in her application that she began working for the Respondent on 24 November 2020.

[9] The Respondent’s response to the application states that the Applicant began working for the Respondent on 26 February 2021 and that the Applicant’s contention she commenced employment on 24 November 2020 was “not true, it was a Casual position and a different role -Warehouse Administration Officer”.

[10] A conference was held on 27 September 2021 and during that conference it was apparent that there was a contest between the Applicant and Respondent as to whether the Applicant’s period of service prior to 25 February 2021 should count when determining whether the Applicant’s employment met the minimum employment period.

[11] There being contested facts involved, the Commission is obliged by s.397 of the FW Act to conduct a conference or hold a hearing.

[12] After taking into account the views of the Applicant and the Respondent and whether a hearing would be the most effective and efficient way to resolve the matter, I considered it appropriate to hold a hearing for the matter, in accordance with s.399 of the FW Act.

Permission to appear

[13] The Respondent was self-represented.

[14] I heard from both parties on the question of representation before the Commission in relation to the Applicant.

[15] Having considered the submissions of the Applicant and the Respondent, I determined that allowing the Applicant to be represented by a lawyer or paid agent would enable the matter to be dealt with more efficiently, taking into account the complexity of the matter.

[16] Accordingly, at the hearing on 15 October 2021, the Applicant was represented by Mr N Dircks.

Witnesses

[17] The Applicant gave evidence on her own behalf, filing a witness statement dated 16 September 2021, filing an updated witness statement dated 13 October 2021 and giving evidence at the hearing on 15 October 2021.

[18] The following witnesses gave evidence on behalf of the Respondent:

•  Ms Fiona Zou, Director of the Respondent, who filed a witness statement and gave evidence at the hearing on 15 October 2021; and

•  Ms Amelia Tian, a friend of a Director of the Respondent, who filed a witness statement.

Submissions and evidence

The Respondent’s objection

[19] By way of summary, the Respondent submitted that:

•  The Applicant was employed as a favour and a position was created for her to “help her out”.

•  The position created was a casual position for a period of three months over the Christmas period and this was explained to the Applicant.

•  It believed the Applicant was looking for alternative employment during this period and did not have a reasonable expectation of ongoing employment.

•  At the date of dismissal, being 7 July 2021, the Applicant had only served a period of four months and 10 working days. 4 Further, the Respondent submitted that the Applicant took 8.75 hours of unpaid leave during the payroll cycle between 3 June 2021and 16 June 2021.5 On this basis, the Respondent submitted the Applicant did not serve the minimum employment.

[20] Ms Zou gave the following evidence: 6

•  On 20 November 2020, Mr John Zeng, Managing Director of the Respondent, suggested that a role be created for the Applicant with the Respondent as he had been asked to help the Applicant out by a friend, Ms Amelia Tian.

•  Ms Zou agreed to the request and met with the Applicant in the afternoon of 20 November 2020.

•  During the meeting, Ms Zou explained to the Applicant that a casual position had been created for her as a favour to Ms Tian, it was not a regular position, that she couldn’t make any guarantee in relation to the employment and that the Applicant said “ok”.

•  During her period of casual employment, the Applicant used the warehouse supervisor’s desk and computer and did not have an individual email or log in details (as permanent employees would have) and that she temporarily used the warehouse supervisor’s login.

•  At the end of the casual contract, the casual position was no longer available.

•  On 25 February 2021, the Respondent offered the Applicant an opportunity to “trial” in the position of Customer Service Officer and that the trial nature of the position was made clear to the Applicant as the skills required for this role were different in comparison to her previous role in the warehouse.

•  Based on the above, Ms Zou did not agree the Applicant had a reasonable expectation of continuing employment by the Respondent on a regular and systematic basis.

[21] Ms Zou also gave evidence that: 7

•  The Applicant was not required to adhere to the attendance rate of full time employees.

•  The Applicant “only performed 82% of her attendance during the casual period”.

•  Based on the above, Ms Zou did not agree that the Applicant’s employment as a casual employee was as a regular casual employee.

[22] Ms Tian’s evidence in her witness statement was that: 8

•  The Applicant’s employment with W. T. Newey & Co, of which she was a director, was terminated on 20 November 2020.

•  During the meeting regarding the Applicant’s termination of employment with W. T. Newey & Co, she offered the Applicant help in completing a Certificate of Registration in Strata Management.

•  Ms Tian asked Mr Zeng if he had any vacant positions and could help the Applicant.

•  Mr Zeng communicated to her that he agreed with his business partner that the Applicant would be employed temporarily in a casual warehouse position for the period around Christmas.

[23] In support of its submission that the Applicant’s employment was not as a regular casual employee, the Respondent filed a copy of the Applicant’s payslips for the period between 25 November 2020 and 24 February 2021.

[24] The Applicant also provided a summary of the hours paid as reflected in those payslips, compared to a full time workload for the pay period. That summary included the dates during which the office was closed. A summary of that information is provided below:

The Applicant’s position

[25] By way of summary, the Applicant submitted: 9

•  The relevant minimum employment period is six months.

•  The Applicant’s letter of offer dated 23 November 2020 does not support a finding that the employment relationship was actually casual and that its terms set out a firm advance commitment of the duration and days (or hours) or her employment.

•  In the alternative, any period the Applicant served as a casual should be counted for the purposes of her minimum employment period because she was employed on a regular and systematic basis and had a reasonable expectation of continuing employment.

•  The Applicant completed her minimum employment period and the jurisdictional objection should be dismissed.

[26] The Applicant gave the following evidence: 10

•  The Applicant commenced working for the Respondent on 24 November 2020 and was dismissed on 7 July 2021.

•  The Applicant attended a job interview with Ms Zou of the Respondent on 20 November 2020.

•  On 23 November 2020, the Applicant was offered a job by Ms Zou via email. A copy of the email was attached to the Applicant’s materials, dealt with the subject ‘Letter of Offer’, and stated:

“Hi Libby,

I was nice to see you last Friday.

Enclosed please find a Letter of Officer. As this Christmas time it is our lower season, therefore normally we don’t hire any new full time employee. Having considered your circumstance we are willing to offer 3 months causal [sic] employment as probation, and we will review to offer you a full time position when it comes end.

If you are ready, you can commence tomorrow.

Your earliest response is highly appreciated.

Kind regards,

Fiona Zou

Executive Director, CFO – Headquarters.”

•  On 23 November 2020, the Applicant accepted the offer and commenced work the following day in the position of Warehouse Administration Officer.

•  The employment was subject to a three month probationary period, with the letter of offer stating:

“1. TERM AND SCOPE OF THIS CONTRACT

(a) The employment contract will be made for casual work employment subject to the completion of 3 months probationary period from the date of commencement, then to be reviewed to change your role to a full time basis”.

•  During the three month probationary period, the Applicant’s standard working hours were 8.30am to 5pm, Monday to Friday. During cross examination the Applicant indicated that she originally worked between the hours of 9.00am and 5.00pm however as the warehouse closed at 4.30pm, her supervisor suggested that she work from 8.30am until 4.30pm each day, with a half hour lunch break.

•  The Applicant was never told her employment was temporary or would likely cease at the end of the probationary period and she expected to continue working after the probationary period on the same or very similar conditions.

•  During the three month probationary period, the Applicant took leave during the Christmas shutdown, one week of leave after the Christmas shutdown and leave for medical appointments. This time off needed to be organised in advance and she had to submit leave application forms. This leave did not have the effect of reducing her service to a period less than six months.

•  Within a day or two of returning from leave in January 2021, she was moved from the warehouse position to a sales office position and received an updated contract on 25 February 2021. This updated contract does not set out a probationary period and she was told she had served her probation.

•  The updated contract set out the same salary and working hours as her previous contract.

•  The Applicant was never told her employment was temporary.

[27] During cross-examination, the Applicant’s evidence was that she was not looking for alternative work during her period of employment with the Respondent and that she completed a certificate in strata management in her own time, having commenced and paid for the course prior to her employment with the Respondent. Under re-examination, the Applicant’s evidence was that she was not looking for alternative employment because she was working full time hours.

The employment contracts

[28] The Applicant filed a copy of a document titled ‘Letter of Offer’ dated 23 November 2020 from the Respondent to the Applicant with her materials (First Contract). The First Contract has the following key characteristics:

•  It states the position offered is “Warehouse Administration Officer”.

•  Clause 2(c) states “You will be employed on a casual basis”.

•  Clause 1 states:

“1. TERM AND SCOPE OF THIS CONTRACT

(a) The employment contract will be made for casual work employment subject to the completion of 3 months probationary period from the date of commencement, then to be reviewed to change your role to a full time basis.

(b) The employment contract will commence from 24/11/2020 and terminate under the conditions of clause 14.”

•  In relation to termination, clause 14 states:

“14. TERMINATION

(a) During the probation period, either you or the company has the right to termination this employment anytime without restriction, but 1 week notification must be given to either party.”

•  In relation to hours of work, clause 6 states:

“6. WORKING HOURS

Basic working hours are from 8.30am to 5.00pm, Monday to Friday. One meal break will be 30 minutes.”

•  Clause 3 states:

“3. SALARY

(a) Your gross wages will be $1,155 per week, plus Superannuation (currently 9.5%). Income tax will be withheld by the Company under relevant legislation.

(b) You will be paid fortnightly on Thursday at the end of 2 weeks works (Covering Thursday – Wednesday). If pay day falls on a public holiday, you will be paid the business day after the public holiday.”

•  In relation to public holidays, clause 7 states:

“7. PUBLIC HOLIDAYS

You are not entitled to be paid during the national and state public holidays during probation period.”

•  Under the heading “8. LEAVE ENTITLEMENTS” the text “n/a” appears.

[29] The Respondent filed a copy of a document titled ‘Employment Contract’ dated 25 February 2021 with its materials (Second Contract). The Second Contract has the following key characteristics:

•  Clause 2(a) states that the Applicant will be employed as a “Customer Service Officer”.

•  Clause 1(a) states that the contract is for “full time work employment”.

•  Clause 1(b) states that the contract will commence from 25 February 2021 and terminate under the conditions of clause 14.

•  In relation to termination, clause 14 states:

“14. TERMINATION

(a) During the probation period, either you or the company has the right to terminate this employment anytime without restriction, but 1 week notification must be given to either party.

(b) After the probation period, if either you or the company wants to terminate the employment, the party may do so by giving another party notice. The Company may choose to pay you an equivalent amount of your salary in lieu of notice. Or if you do not give the Company the required notice, the Company may withhold from all monies due to you an amount of money equal to the period of notice you did not give it. Hereunder is the notice requirement for each party:

•  In relation to hours of work, clause 6 states:

“6. WORKING HOURS

Basic working hours are from 8.30am to 5.00pm, Monday to Friday. One meal break will be 30 minutes”.

•  Clause 3 states:

“3. SALARY

(a) Your annual gross salary will be $1,115 per week, plus Superannuation (currently 9.5%). Income tax will be withheld by the Company under relevant legislation.

(b) You will be paid fortnightly on Thursday at the end of 2 weeks works (Covering Thursday – Wednesday). If pay day falls on a public holiday, you will be paid the business day after the public holiday.

(c) You will participate in the company bonus program. More details as per “EVERSTONE BONUS SCHME 2019 (GENERAL).”

•  In relation to public holidays, clause 7 states:

“7. PUBLIC HOLIDAYS

You are entitled to be paid during the national and state public holidays.”

•  Clause 8 sets out entitlements to paid leave and refers to the “Leave Entitlement Policy V2019.1.”

Consideration and findings

Has the Applicant been dismissed?

[30] A threshold issue to determine is whether the Applicant has been dismissed from her employment.

[31] Section 386(1) of the FW Act provides that the Applicant has been dismissed if:

(a) the Applicant’s employment with the Respondent has been terminated on the Respondent’s initiative; or

(b) the Applicant has resigned from their employment but was forced to do so because of conduct, or a course of conduct, engaged in by the Respondent.

[32] Section 386(2) of the FW Act sets out circumstances where an employee has not been dismissed, none of which are presently relevant.

[33] There was no dispute and I find that the Applicant’s employment with the Respondent terminated at the initiative of the Respondent.

[34] I am therefore satisfied that the Applicant has been dismissed within the meaning of s.385 of the FW Act.

Minimum employment period

[35] It is not in dispute and I find that the Respondent employed 15 or more employees at the time of the Applicant’s dismissal and is therefore not a small business employer as defined by s.23 of the FW Act.

[36] It flows from this finding that the minimum employment period the Applicant needs to have satisfied in order to be protected from unfair dismissal is a period of six months, pursuant to s.383(a) of the Act.

[37] I find on the basis of the evidence before me, including the First Contract and the statements of Ms Zou and the Applicant, that the Applicant commenced employment with the Applicant on 24 November 2020.

[38] It is not in dispute and I find that the Applicant was dismissed from her employment by the Respondent on 7 July 2021. 11

[39] The period between 24 November 2020 and 7 July 2021 is a period exceeding six months. However, it is apparent that the matter in dispute is whether the service between 24 November 2020 and 25 February 2021 should be counted in determining whether the Applicant has served the minimum employment period.

[40] There are contested facts regarding the Applicant’s employment status between 24 November 2020 and 25 February 2021, with the Applicant submitting that her employment in this period was not actually as a casual employee when considered in the context of recent authorities and recent amendments to the FW Act. 12 In the alternative, the Applicant submits that her period served as a casual should be counted for the purposes of her minimum employment period because she was employed on a regular and systematic basis and had a reasonable expectation of continuing employment.

[41] Section 384 of the FW Act provides:

(1) An employee’s minimum period of employment with an employer at a particular time is the period of continuous service the employee has completed with the employer at that time as employee.

(2) However:

(a) a period of service as a casual employee does not count towards the employee’s period of employment unless:

(i) the employment as a casual employee was as a regular casual employee; and

(ii) during the period of service as a casual employee, the employee had a reasonable expectation of continuing employment by the employer on a regular and systematic basis;…

[42] Section 12 of the FW Act provides that a national system employee of a national system employer is a “regular casual employee” at a particular time if, at that time:

(a) the employee is a casual employee; and

(b) the employee has been employed by the employer on a regular and systematic basis.

[43] There is an argument as to whether the Applicant was indeed a casual employee. However, for the purposes of determining whether the Applicant has served the minimum employment period in relation to the period in question, a finding that the Applicant was employed on a regular and systematic basis and had a reasonable expectation of continuing employment on that basis will mean that the period of service is counted.

[44] In considering whether the Applicant has been employed on a regular and systematic basis, it is the ‘employment’ that needs to be considered, not the hours worked. 13 However, a clear pattern of hours is strong evidence of regular and systematic employment.14 The term ‘regular’ implies a repetitive pattern and does not mean frequent, often, uniform or constant.15 The term ‘systematic’ requires that the engagement be ‘something that could fairly be called a system, method or plan’.16 Where there is no clear pattern or roster, evidence of regular and systematic employment can be established where:

•  the employer offered suitable work when it was available at times that the employee had generally made themselves available, and

•  work was offered and accepted regularly enough that it could no longer be regarded as occasional or irregular. 17

[45] For a period of service as a casual employee to count toward the minimum employment period, it will be necessary that the employee be employed on a regular and systematic basis and have a reasonable expectation of ongoing employment on that basis throughout that period. 18 If during any part of the period one of these elements is not present, that part of the period will not count toward the minimum employment period.19 Once continuous service is established, the employer or employee may only break continuous service by making it clear to the other party that there will be no further engagements.20 Absence for illness or injury does not break a period of continuous service.21

[46] In my opinion, between 24 November 2020 and 25 February 2021, the Applicant was employed on a regular and systematic basis. While there were some days that the Applicant did not work, including over the end of year period and to attend medical appointments, over the period in question the Applicant’s employment was regular in that she was engaged most weeks. I also find that the employment was systematic as I accept the Applicant’s evidence that she generally worked according to a pattern of hours, Monday to Friday, albeit with a slight variation to the start and finishing times as set out in the First Contract.

[47] As to whether the Applicant had a reasonable expectation of ongoing employment over this period, I accept the Applicant’s evidence that she considered that her employment was ongoing and I consider this expectation to be a reasonable one. Indeed, her contract foreshadowed a review with the potential to move to full time employment at the completion of her probationary period and this ultimately occurred. Whether the position was created as a favour to the Applicant or not is not a relevant consideration. I find that the Applicant’s service between 24 November 2020 and 25 February 2021 counts towards the minimum employment period. Adding this service to the Applicant’s service between 26 February 2021 and 7 July 2021, I find the Applicant’s service meets the requirements of s.384 of the FW Act and that the Applicant’s service meets the minimum employment period.

Conclusion

[48] The Applicant has completed a period of employment with the Respondent that is at least the minimum employment period, as required by s.382(a) of the FW Act. The Respondent’s jurisdictional objection is dismissed. The Applicant’s unfair dismissal application will now be programmed and listed for further hearing.

COMMISSIONER

Appearances:

Mr N Dircks on behalf of the Applicant

Ms F Zou and Mr J Audet on behalf of the Respondent

Hearing details:

2021.

Sydney (By Video using Microsoft Teams).

October 15.

Printed by authority of the Commonwealth Government Printer

<PR735830>

 1   Applicant, ‘Form F2 – Unfair dismissal application’, filed 28 July 2021, 1.3, 1.4; Respondent, ‘Form F3 – Employer response to unfair dismissal application’, filed 10 August 2021, 1.3, 1.4, 3.1

 2   Respondent, ‘Form F3 – Employer response to unfair dismissal application’, filed 10 August 2021, 1.5.

 3   Ibid, 1.7.

 4   Respondent, ‘Respondent’s outline of argument: objections’, filed 6 October 2021, 2.a, 2.d.

 5   Ibid, 2.i.

 6   Ms Zou, ‘Witness statement number 1’, filed 6 October 2021.

 7   Ms Zou, ‘Witness statement number 1’, filed 6 October 2021.

 8   Ms Tian, ‘Witness statement number 2’, filed 6 October 2021.

 9   Applicant, ‘Outline of Submissions Jurisdictional Objection: Minimum Employment Period’, filed 16 September 2021.

 10   Applicant, ‘Updated Witness Statement – Jurisdiction (Minimum Employment Period)’, filed 13 October 2021.

 11   Applicant, ‘Form F2 – Unfair dismissal application’, filed 28 July 2021, 1.3, 1.4; Respondent, ‘Form F3 – Employer response to unfair dismissal application’, filed 10 August 2021, 1.3, 1.4, 3.1

 12   Applicant, ‘Outline of Submissions Jurisdictional Objection: Minimum Employment Period’, filed 16 September 2021, [16].

 13   Yaraka Holdings Pty Limited v Giljevic [2006] ACTCA 6, [65]; (2006) 149 IR 399; cited in Ponce v DJY Staff Management Services Pty Ltd T/A Daly’s Traffic [2010] FWA 2078, [70].

 14   Ponce v DJY Staff Management Services Pty Ltd T/A Daly’s Traffic [2010] FWA 2078, [75].

 15   Yaraka Holdings Pty Limited v Giljevic [2006] ACTCA 6, [68]; (2006) 149 IR 399; cited in Grives v Aura Sports Pty Ltd [2012] FWA 5552, [32].

 16   Shortland v Smiths Snackfood Co Ltd [2010] FWAFB 5709, [13].

 17   Ponce v DJY Staff Management Services Pty Ltd T/A Daly’s Traffic [2010] FWA 2078, [76].

 18   Miller v CCM Quality Meats Pty Ltd [2021] FWC 3967, [15].

 19   Bronze Hospitality Pty Ld v Hannson [2019] FWCFB 1099, [29]; cited in Miller v CCM Quality Meats Pty Ltd [2021] FWC 3967, [15].

 20   Shortland v Smiths Snackfood Co Ltd [2010] FWAFB 5709, [13].

 21   Ibid.