[2012] FWA 9266

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Fair Work Act 2009
s.394—Unfair dismissal

Neville Hudson
Coonawarra Jack Winery Pty Ltd T/A Coonawarra Jack Winery



Termination of employment - jurisdiction - high income threshold - award free status - contract of employment - small business.

[1] On 27 August 2012 Mr Hudson lodged an application pursuant to s.394 of the Fair Work Act 2009 (the FW Act), through which he asserted that the termination of his employment with Coonawarra Jack Winery Pty Ltd (Coonawarra Jack) was unfair.

[2] Coonawarra Jack lodged an objection to the application on the basis that Mr Hudson was not covered by the FW Act unfair dismissal legislation and that he was engaged under a contract for a specified task. The conciliation process did not occur.

[3] Section 396 requires that Fair Work Australia (FWA) decides four preliminary issues before considering the merits of the application. A hearing for this purpose was convened on 29 October 2012. At this hearing Mr Hudson represented himself by video from Naracoorte and Coonawarra Jack was represented by its Winery Manager, Mr Lees.

[4] I have considered the initial matters identified in s.396.

[5] The application was lodged within the statutory time limit.

[6] Sections 382 and 383 state:

[7] Mr Hudson commenced work at Coonawarra Jack on 17 July 2011. His employment concluded on 20 August 2012. Hence, irrespective of whether Coonawarra Jack was a small business employer, for the purposes of s.383, he had completed at least the minimum employment period referenced in s.382(a).

[8] Mr Hudson was engaged as a Senior Winemaker. He reported to the Winery Manager and to the Company Directors. All of the Winery production and laboratory staff reported to him. Having considered Mr Hudson’s duty statement, I have concluded that he held a senior management function.

[9] The Wine Industry Award 2010 covers employers in the wine industry and their employees in the classification specified in that Award 1. There is no classification which relates to Mr Hudson’s position, and I have concluded that he is not covered by a modern award.

[10] No enterprise agreement applies to Coonawarra Jack.

[11] Section 332 states:

[12] The High Income Threshold from 1 July 2012 is $123,300.

[13] Regulation 3.05 deals with the assessment of the high income threshold. As Mr Hudson was not a piece worker the relevant components of that regulation are set out below:

[14] There is no dispute that Mr Hudson’s employment contract provides for an annual salary of $100,000. The contract provides for the provision of a motor vehicle in the following terms:

[15] Similarly there is no dispute that superannuation is addressed in the following terms:

[16] The parties both agreed that $3503 was the amount paid to Mr Hudson over the past year in excess of the minimum legislation obligations.

[17] Coonawarra Jack has assessed Mr Hudson’s income on the following basis: 3



Super 3.6%

$ 3,503

Vehicle lease

$ 15,550

Vehicle rego & insurance

$ 1,819

Vehicle fuel

$ 5,100

Vehicle tyres

$ 600

Vehicle servicing

$ 855


$ 1,200

Relocation contribution Jan ‘12

$ 2,400



[18] Mr Hudson’s position is that the commercial value attaching to the vehicle was negotiated at $10,000.

[19] The vehicle provided to Mr Hudson was a 2009 Holden Colorado. Neither Mr Hudson nor Mr Lees could recall the number of kilometres travelled by the vehicle over the course of the year prior to the termination of Mr Hudson’s employment, but both agreed that it would be in the order of 30,000 km. I note that this travel is consistent with the Coonawarra Jack estimate of fuel used. Mr Hudson’s position is that 60% of the vehicle utilisation was for work purposes. Mr Lee’s position is that 25% of the vehicle use was for work purposes. I have concluded that both these estimates are subjectively determined. Notwithstanding this, I have relied on Mr Lees estimate for the purposes of this calculation.

[20] The RAA fixed cost estimate for a comparable Holden Colorado is $241.73 per week. That costing takes into account the vehicle purchase costs, depreciation, interest registration and insurance, fuel and servicing. Running costs have been assessed by the RAA at $0.2511 per kilometre. If the vehicle travelled 30,000 km this would involve costs of $20,102.96 per year. I have discounted this amount by 25% to take into account Mr Lee’s estimate of work usage. This gives a total value of the provision of the vehicle to Mr Hudson of $15,077.22.

[21] Notwithstanding that, I consider that the RAA costing approach represents the more appropriate costing methodology, I have compared this costing with that provided by Mr Lees. Mr Lee’s cost estimates totalled $23,924. If that amount is reduced by 25% to take account of the estimated work usage, this gives a total value to Mr Hudson of $17,943.

[22] I have included in Mr Hudson salary, $3503 being the superannuation payment in excess of the minimum employer superannuation obligations.

[23] Mr Hudson was provided with an employer funded mobile telephone. His evidence was that he used this for work purposes given that he was generally available to be called in to work. Additionally, Mr Hudson agreed that he used the telephone for private purposes. Whilst the extent of this private use was not clear I have taken it to be 50% and have assessed the income component of the mobile telephone to be $600.

[24] Mr Hudson was reimbursed for relocation expenses. I have not included this amount in the calculation of his earnings on the basis that it was a reimbursement for agreed expenses.

[25] The total assessment of earnings applicable to Mr Hudson on this basis is $119,180.22 per annum. Even if I accepted the Coonawarra Jack vehicle costing assessment, Mr Hudson’s total remuneration value would be $122046 per annum. This is less than the current high income threshold such that Mr Hudson is protected from unfair dismissal.

[26] Mr Hudson can only be unfairly dismissed if in fact he was dismissed. Section 385 states:

[27] Section 386 defines the meaning of dismissed.

[28] Mr Hudson was engaged under a written contract. It was not a contract for a specified period of time. Mr Hudson was employed for a particular job but he was not employed for a specified task or season which then concluded giving rise to the termination of his employment. The mere specification of duties or tasks does not, of itself, exclude employees from unfair dismissal protection. None of the circumstances set out in s.386(2) apply in this situation.

[29] Mr Lee’s advice to me was that he terminated Mr Hudson’s employment.

[30] Accordingly, I have concluded that Mr Hudson was both dismissed and was also protected from unfair dismissal under the FW Act.

[31] Section 396(c) requires that I determine whether the Small Business Fair Dismissal Code has application. Section 388 states:

[32] Section 23 defines a small business employer in the following terms.

[33] If Coonawarra Jack was a small business employer at the time of the termination of Mr Hudson’s employment, s.388 requires that I initially consider whether that dismissal was consistent with that Code.

[34] Mr Lees has provided a list of 19 employees, including Mr Hudson, as at mid August 2012. Mr Hudson has expressed doubt about whether three or four of these 19 employees can be included on the basis that they were not casual employees engaged on a regular and systematic basis. Consequently, even if those three or four employees are excluded from the Coonawarra Jack list of employees, the employer had more than 15 employees at the time of the termination of Mr Hudson and hence the Small Business Fair Dismissal Code does not have application.

[35] Finally, in terms of s.396, there is no suggestion that the termination of Mr Hudson’s employment was a genuine redundancy.


[36] I have concluded that Mr Hudson was dismissed, and that he was protected from unfair dismissal. The Small Business Fair Dismissal Code does not have application in this situation. The Coonawarra Jack objections to Mr Hudson’s application are dismissed. An Order [PR530875] giving effect to this decision will be issued.

[37] As I indicated to the parties I will arrange for the parties to have access to a member of FWA to facilitate conciliation. This is an entirely voluntary process. The matter will be listed for hearing on 3 December 2012 in the event that it is not settled. Directions for this hearing will be issued shortly.



N Hudson on his own behalf.

M Lees representing Coonawarra Jack Winery.

Hearing details:


Adelaide (and Videolink to Naracoorte)

October 29.

 1   Wine Industry Award 2010, clause 4

 2   Exhibit CJ1

 3   Extract from Coonawarra Jack Winery correspondence dated 28/9/12

Printed by authority of the Commonwealth Government Printer

<Price code C, PR530831>