[2012] FWA 7049

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Fair Work Act 2009
s.394—Unfair dismissal

David McMillan
Northern Project Contracting T/A NPC

Graeme Norman
Northern Project Contracting T/A NPC



Termination of employment - jurisdiction - employment covered by an enterprise agreement or modern award - high income threshold.

[1] The following decision, now edited, was given in transcript in Brisbane on 13 July 2012. The parties had been advised at the conclusion of proceedings that it was my intention to give a decision immediately. Mr McMillan and Mr Norman (the applicants) had appeared on their own behalves and Ms C Yeo and Mr S Clark for Northern Project Contracting T/A NPC (the respondent).

[2] “There are some differences in the applications. There are well-known differences in the contracts. I do not know that I will even set out every difference. I am going to go to the salient points and indicate what my finding is.

[3] This is a case where David McMillan makes an application for relief following the termination of his employment by Northern Project Contracting trading as NPC, and similarly, pursuant to s.394, Graeme Norman makes application for relief as a consequence of the termination of his employment. I will not go into the details, but again one is appreciative of the service that has been given; that is, of the length of the service. I do not say that in a qualitative sense but quantitatively, service that has been given by Mr Norman and by Mr McMillan.

[4] Mr McMillan was employed - and a great deal of this material is not in contest - as the crushing supervisor at the operation and responsible for, I understand, five staff; that may vary, at the time of the termination. Mr Norman was engaged as the project manager with particular responsibility, it seems, for labour hire. The contest in this case is whether there is jurisdiction inhering in the Tribunal to hear an application and that, of course, requires one to look at Division 2 of Part 3-2 of the Fair Work Act 2009 (the Act), and particularly s.382, setting out when a person is protected from unfair dismissal.

[5] Section 382 is in the following terms:

[6] There have been helpful submissions made both by the applicants in a shorter form but in a pretty focused form, and also by Ms Yeo for the respondent in the detailed submissions that have been prepared.

[7] I will say something about the procedural matters. There is an objection taken to Fair Work Australia having regard to some of what is called procedural matters in the submissions provided by both applicants. I have not had regard for those merit based aspects of the submissions put forward by the applicants; that is, the reasons that they believe there is unjustness and unreasonableness and harshness in the fact of their termination, particularly relating to the fact that something happened - and I do not know what it was. There was a safety incident. There was some intervention in one case, I think in Mr McMillan’s case, and in Mr Norman’s case he was absent, and that in any event - I hope I have got that right - there is great exception taken to the fact that no reason was provided for the terminations. That seems, from the way in which the applicants have approached the case, to have informed them at the beginning of the day and at the end of the day, because it seems a natural sense of injustice arises from the fact that you might lose your livelihood and not be told why that is so. Certainly that is the way I have understood the submissions, and particularly the emotion of the applicants.

[8] Of course, against them Ms Yeo says, “Well, that might all be so, but it cannot go to substitute for a reason or a ground which relates to jurisdiction.”

[9] The procedural matters also deal with such points, and they really are quite distant from the jurisdictional point that it is my duty to consider today, and that is, that people involved in whatever it was that happened were not terminated, and whether or not the conduct that these men were engaged in or not engaged in was conduct to which exception could be taken.

[10] The Act makes clear when a person is protected from unfair dismissal, and it is, if, at the relevant time, the person has completed a period of employment with their employer of the minimum employment period, and, relevant to this case, whether one or more of the following circumstances apply. The first is a modern award covers the person, the second is an enterprise agreement applies to the person, and the third is the sum of the person's annual rate of earnings, with a reference to the Regulations.

[11] Nothing was said about the middle ground; that is, the section 382(b)(ii) ground that there is an enterprise agreement. I am unaware of an enterprise agreement. I am not in the position to find that an enterprise agreement applies to either Mr McMillan or Mr Norman.

[12] I deal with the point then of whether a modern award covers Mr Norman or Mr McMillan. This issue is clouded to some extent by the fact that the men, in what I regard as an entirely understandable way, rely on their contracts, which have been admitted into evidence. The contract of employment is exhibit SC1 in Mr Clark’s affidavit, which is exhibit NP1, and the contract of employment declares that the “Mining Award 2010” (the correct title being the Mining Industry Award 2010 [MA000011]) (the Award) has application. That is at clause 6.1 of Mr Norman’s contract, and I think the other contract is identical in so providing.

[13] From the point of view of the applicants, there is particular disappointment to hear that that is not so and, moreover, that the contract having said so, cannot go to make it so. I hope that is capable of understanding. In this case an error was made by whoever provided these contracts and there was a reference to the Award.

[14] The fact that the contract of employment says that does not make it so; because the Award and its coverage are not determined by the contract but rather determined by the legislation, and it is the case that section 48 of the Act sets out how it is that the award coverage has effect. I am going to read that section; it is very short:

[15] The submissions made by Northern Project are reasonably extensive and state that the Award cannot be said by any reasonable reading to extend to a managerial person such as Mr Norman or a supervisor such as Mr McMillan whose primary task was to provide work. Evidence has been given about these things, and I have accepted what has been said from the bar table, without really any reservation, that the upper reaches of the Award cannot be said to cover these functions. That has not done anything to advance the coverage argument because it does not cover such work. In a real-life sense a misdescription can apply because one can be called a crushing supervisor and that might camouflage the true duties; but I have heard the evidence about what Mr McMillan did do, and it seemed to me he was a true supervisor. He had staff under his authority so that I have found he was a genuine supervisor, not labouring under an incorrect description in the same way as he could labour under an incorrectly crafted contract of employment, as Mr McMillan and Mr Norman now know.

[16] Similarly for Mr Norman. I have not heard quite as much about Mr Norman’s duties, but there is no reason to conclude that he was other than a project manager and enjoying the responsibilities or having to give effect to those responsibilities. I do not find that he is covered by the Award. I find neither of the applicants are covered by the Award.

[17] That leaves the sum of the person’s annual rate of earnings, and I really am unable to find that the term “annual rate of earnings” means other than the annual rate of earnings. It is the year-to-date figure which is contended for by the applicants on the one part, and said to be under the limit, the $118,100 limit, and I find that the annual rate of earnings is, regrettably for the applicants, properly understood, in the amount of $124,366.

[18] The Northern Project argument includes - and it is not necessary that I determine this next point and I do not know that I will make a final determination on it - but it is said to be supplemented by the benefit which can be seen to be the value of charter flights and also, in Mr McMillan’s case, the value of the RPT, the commercial flights, the regular public transport flights, Brisbane-Townsville.

[19] That is said to be - and this picks up the benefits other than payment of money - that I should, having regard to the circumstances, consider the benefit of the employer getting employees to the work site at this very distant place, for the purpose of assessing whether the high income threshold applies. That is, when a reasonable money value has not been agreed and Fair Work Australia can estimate a real or notional money value of the benefit; thus reads the regulation.

[20] I have not been assisted by any authority in this regard. I am not going to finally decide that point. It is not necessary to do so. I must say I do not feel an initial attraction to that (the value of charter flights to a remote camp) being included as a benefit in the requisite sense, because it seems to me to be really a part of the employment in a different sense. Perhaps I could put it this way: it is not a benefit, for example, particularly in relation to charter travel or transport to the site, by way of contrast, to the provision of a motor vehicle where an employee has the right of private use, where that can then be said to be a benefit. In such cases there is a formula for working out private use, considering how many weekends, or whether the employee is allowed to take it away on weekends or on the employee’s annual leave and still have petrol provided, or not, and so on. One can calculate those things according to taxation rulings and also by the commonsense application of a calculator.

[21] The charter flight valuations strike me as a part of employment of a dissimilar sort, but I do not make any final determination of that issue. Full submissions on what is an interesting issue have not been made and, rather, there have been a range of assertions made.

[22] As a consequence of coming to the conclusion that the modern award does not cover the work and there had been no enterprise agreement and the sum of the person’s annual rate of earnings is in each case higher than the high-income threshold, it follows there is no jurisdiction to hear the case, and I so find.

[23] I dismiss the applications. An order to that effect will issue shortly.”



D McMillan on his own behalf.

G Norman on his own behalf.

C Yeo with S Clark for Northern Project Contracting T/A NPC.

Hearing details:

July 13.

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