DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Jane Aming
v
Gledswood Homestead & Winery Pty Ltd
(U2020/7502)

Application for an unfair dismissal remedy – minimum employment period – application dismissed.

[1] Jane Aming (“the applicant”) has made an application, pursuant to s.394 of the Fair Work Act 2009 (“the Act”), in which she seeks an unfair dismissal remedy. The applicant was formerly employed by Gledswood Homestead & Winery Pty Ltd (“the respondent”), which operates in the hospitality industry as a catering and events business. The applicant was formerly employed on a casual basis as a Line Cook with duties allocated to her by the Executive Chef. The underpinning industrial instrument was the Hospitality Industry (General) Award.

[2] The applicant was dismissed by the respondent on 18 May 2020, for reasons which are unnecessary to outline in this decision, and lodged her application for an unfair dismissal remedy on 1 June 2020. In the respondent’s Form F3 – Employer response to unfair dismissal application the respondent noted, among other matters, a Small Business Fair Dismissal Code (“Code”) objection to the application. I caused directions to be issued in conjunction with listing advice concerning a conference and/or directions telephone proceeding. Discussion between the parties at a pre-hearing listing which proceeded on (a rescheduled date of) 8 July 2020 did not result in a resolution of the matter; the directions were amended by consent.

[3] On 15 July 2020, at a time when the respondent’s first round of materials was pending under the amended directions, the respondent’s solicitor filed and served correspondence flagging a jurisdictional objection to the application which was separate from the initial objection concerning the Code. The foreshadowed objection concerned the minimum employment period. The correspondence relevantly read:

“I refer to the abovementioned matter in which Commissioner McKenna has made Directions concerning the filing of material relevant to the Hearing of this matter.

I note that the Commission has made Directions in relation to both matters pertaining to jurisdiction of the Application and the merits of the Application.

We have obtained our client’s instructions and advise that the Respondent will be filing and serving evidence and an outline of submissions to show that the Applicant has failed to complete the minimum period of employment as is required by section 382 of the Fair Work Act, 2009 (Cth), meaning that the Application must be dismissed. We draw this matter to the attention of the Commission because the Respondent now proposes that this matter be dealt with as a threshold issue and determined by the Commission before any material is filed in connection with the merits of the matter.

Accordingly, the Respondent requests that the Commission amend the previously issued Directions such that the filing of any material about the merits of the matter is deferred until the threshold issue referred to above is dealt with. We propose this course of action in the interests of both parties and their time and respective legal costs.

If it appropriate for the matter to be relisted before Commissioner McKenna in order for the issues in this letter to be formally addressed, the writer is available at short notice.

I have copied the Applicant’s representative into this correspondence.”

[4] Upon receiving the correspondence from the respondent’s solicitor, I reviewed the file papers. As a consequence of that review, I instructed my Associate to request a copy of the Employment Separation Certificate (“ESC”) issued by the respondent on 23 March 2020, being an ESC to which reference had been made in the Form F3. The ESC issued by the respondent on 23 March 2020 pre-dated the subsequent dismissal on 18 May 2020 which was the subject of the application lodged on 1 June 2020. Further to that request, a copy of the ESC was filed and served by the respondent’s solicitor.

[5] In proceedings on 17 July 2020 which were listed in response to the correspondence from the respondent’s solicitor, and over the written and oral objections of the applicant’s representative, I determined to revise the directions in order to deal with the minimum employment period objection as a standalone, preliminary matter. This is because s.396 of the Act provides that certain initial matters must be considered before consideration of the merits of the application:

“396 Initial matters to be considered before merits

The FWC must decide the following matters relating to an application for an order under Division 4 before considering the merits of the application:

(a) whether the application was made within the period required in subsection 394(2);

(b) whether the person was protected from unfair dismissal;

(c) whether the dismissal was consistent with the Small Business Fair Dismissal Code;

(d) whether the dismissal was a case of genuine redundancy.”

[6] As to s.396 of the Act in the context of this case, the initial matter is whether the applicant is a person who was protected from unfair dismissal having regard to the minimum employment period. The relevant statutory provisions in such respects are s.382 (dealing with when a person is protected from unfair dismissal), s.383 (dealing with the meaning of the “minimum employment period”) and s.384 (concerning the “period of employment”). Those provisions read:

“382 When a person is protected from unfair dismissal

A person is protected from unfair dismissal at a time if, at that time:

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

(b) …

383 Meaning of minimum employment period

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.

384 Period of employment

(1) An employee’s 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 an 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 on a regular and systematic basis; 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) …”.

[7] Separately from the provisions of ss.382-384, s.22 provides some elaboration about the meanings of “service” and “continuous service”, as follows:

“22 Meanings of service and continuous service

General meaning

(1) A period of service by a national system employee with his or her national system employer is a period during which the employee is employed by the employer, but does not include any period (an excluded period) that does not count as service because of subsection (2).

(2) The following periods do not count as service:

(a) any period of unauthorised absence;

(b) any period of unpaid leave or unpaid authorised absence, other than:

(i) a period of absence under Division 8 of Part 2-2 (which deals with community service leave); or

(ii) a period of stand down under Part 3-5, under an enterprise agreement that applies to the employee, or under the employee’s contract of employment; or

(iii) a period of leave or absence of a kind prescribed by the regulations;

(c) any other period of a kind prescribed by the regulations.

An excluded period does not break a national system employee’s continuous service with his or her national system employer, but does not count towards the length of the employee’s continuous service.

(3A) Regulations made for the purposes of paragraph (2)(c) may prescribe different kinds of periods for the purposes of different provisions of this Act (other than provisions to which subsection (4) applies). If they do so, subsection (3) applies accordingly. …”.

[8] Reference was made in the proceedings to another section of the Act, namely s.524 (dealing with stand downs). That section reads:

“524 Employer may stand down employees in certain circumstances

(1) An employer may, under this subsection, stand down an employee during a period in which the employee cannot usefully be employed because of one of the following circumstances:

(a) industrial action (other than industrial action organised or engaged in by the employer);

(b) a breakdown of machinery or equipment, if the employer cannot reasonably be held responsible for the breakdown;

(c) a stoppage of work for any cause for which the employer cannot reasonably be held responsible.

(2) However, an employer may not stand down an employee under subsection (1) during a period in which the employee cannot usefully be employed because of a circumstance referred to in that subsection if:

(a) an enterprise agreement, or a contract of employment, applies to the employer and the employee; and

(b) the agreement or contract provides for the employer to stand down the employee during that period if the employee cannot usefully be employed during that period because of that circumstance.

(3) If an employer stands down an employee during a period under subsection (1), the employer is not required to make payments to the employee for that period.”

[9] As at 23 March 2020, the date the ESC was issued by the respondent to the applicant, the provisions of Part 6-4C of the Act (Coronavirus Economic Response) were not in place.

Background

[10] It is apposite to set out a timeline of certain key dates:

•  the applicant commenced employment with the respondent on 4 October 2011 and worked thereafter as a casual employee (the applicant declined two earlier offers to her by the respondent in 2018 and 2019 to convert from casual employment to permanent part-time employment);

•  due to COVID-19-related restrictions announced to commence on 23 March 2020, all hospitality events at the respondent’s premises were cancelled as there was no work for any of the casual employees (except for the respondent’s casual bookkeeper);

•  on or about 23 March 2020, the respondent issued ESCs to all its casual employees except the bookkeeper (approximately 22 in total, albeit there was evidence that one casual employee did not receive an ESC).

[11] The circumstances were described in the following way in the evidence of Nadene Clarke, who is the respondent’s Managing Director and the owner of Gledswood Homestead and Winery:

“7. During the week commencing 16 March 2020, the government imposed tight restrictions that resulted in the business being unable to trade. The restrictions announced were to commence on and from 23 March 2020. This broke my heart. The directive from the government resulted in the business losing 99% of income overnight. My greatest concern at that point was the livelihood of all employees of the business.

8. I received a phone call from my Accountant during the week of 16 March 2020 to put some survival strategies in place. He was adamant about putting tough but necessary measures in place as soon as possible to ride out the pandemic. We had to make a very swift decision to reduce any unnecessary spending and, unfortunately, casual employees were one of those expenses.

9. Given the government announcement about the restrictions and inability to trade, all events at Gledswood were cancelled. This had an immediate impact on the work that could be offered to our casual employees, including [the applicant].

10. On 23 March 2020, all casual employees were issued with a Separation Certificate because there was no work that could be offered to them. Issuing the Separation Certificate to casual employees was an opportunity for them to apply to Centrelink to obtain whatever social security payments were then available to them.

11. I advised all employees that it was my intention to have jobs for them in the future, subject to the government restrictions being lifted and work becoming available.

12. To my understanding, several casual employees sought Centrelink benefits immediately and some employees secured casual work elsewhere. At this point, I had absolutely no idea if there would be a business to come back to. I spent many countless hours scouring social media platforms, employment websites and local small businesses for vacant positions that my team would be suitable for. These positions were posted on our internal noticeboard … for all employees to see and act upon. Through doing this, two employees commenced casual employment with a local personal [and] cleaning services business within a week of the casual employees being terminated.”

[12] Relevantly:

•  in the period 23 March 2020 to 27 April 2020, the respondent employed only seven employees who were “deemed critical” to the business (comprising three full-time employees, three permanent part-time employees and one casual bookkeeper employee) on half-pay and reduced hours, in circumstances where the business “was faced with cancellations of events, demands of refunds, huge fixed costs and zero cash flow”;

•  following the introduction of the JobKeeper scheme, the applicant was among the eight (out of 22) casual employees the respondent again employed from 28 April 2020, with varied COVID-19-related terms and conditions of employment as set out in a letter dated 25 April 2020 which referred to the Coronavirus Economic Response provisions of Part 6-4C of the Act;

•  the applicant’s first shift pursuant to the arrangements set out in the letter dated 25 April 2020 was 28 April 2020;

•  on 18 May 2020, the respondent dismissed the applicant citing the conduct-related reasons outlined in the letter advising of the termination of employment (at which time, it is common ground, the respondent had a total of 14 employees).

Respondent’s submissions on its minimum employment period objection

[13] The respondent contended that the applicant’s period of employment was 20 days because her employment by the respondent, for the purposes of the application before the Commission, commenced on 28 April 2020. Pursuant to s.382 of the Act, the respondent submitted, the applicant had failed to complete a period of employment with the respondent of at least the minimum period of employment. The ESC issued by the respondent and provided to the applicant “is clear and unequivocal in its terms” in as much as it states that the applicant started working with the respondent on 4 October 2011 and her employment ceased on 23 March 2020.

[14] That is, the respondent’s submissions continued, the applicant’s employment (as one of the 22 casual employees) was terminated by the respondent on 23 March 2020 and that termination of the applicant’s employment on 23 March 2020 broke the employment and service with the respondent for the purposes of s.382 of the Act. In the period 23 March 2020 to 27 April 2020, the applicant was not an employee of the respondent. Following the termination of the applicant’s employment on 23 March 2020, the JobKeeper scheme was announced that then allowed businesses to consider re-employing employees; and the applicant was re-employed on new terms and conditions of employment that commenced on 28 April 2020. In effect, the respondent submitted, the applicant commenced a new period of employment with the respondent on 28 April 2020.

[15] The respondent does not dispute that the applicant had a prior period of service being from 4 October 2011 until 23 March 2020. Rather, the submissions for the respondent were that on 23 March 2020 the applicant’s employment with the respondent was terminated. This meant, the respondent’s submissions continued, that the applicant’s employment and service were broken, and any service before her employment recommenced on 28 April 2020 does not count. In so submitting, the respondent’s submissions referred to Shortland v The Smiths Snackfood Co Ltd [2010] FWAFB 5709 (“Shortland”) at [10]-[14], particularly including the following quote:

“[13] Continuous service by a casual employee who has an established sequence of engagements with an employer is broken only when the employer or the employee make it clear to the other party, by words or actions that there will be no further engagements. The gaps between individual engagements in a sequence of engagements should not be seen as interrupting the employee’s period of continuous employment within the meaning of s.384. In particular, a period of continuous service within the meaning of s.384(1) is not to be seen as broken by a period of ‘leave’ or an absence due to illness or injury.”

[16] The respondent submitted, relying on the authority of Shortland, that the service of a casual employee is broken when one party makes it clear to the other party that there will be no more engagements; and this was the case here, it was further submitted, with the respondent-issued ESC of 23 March 2020 relevantly breaking the applicant’s service. In so submitting the respondent referred also to Holland v UGL Resources Pty Ltd [2012] FWA 3453 (“Holland”) at [33]-[34].

[17] The respondent submitted the application must be dismissed because the applicant’s period of service with the respondent was broken on 23 March 2020. The second period of employment, commencing on 28 April 2020, lasted for 20 days and that period fails to meet the minimum employment period prescribed by the Act.

Applicant’s submissions on the respondent’s minimum employment period objection

[18] The applicant’s submissions, on the minimum employment period point, were that the applicant was employed as a casual employee in a consistent and systematic manner by the respondent from 4 October 2011 to 18 May 2020. The applicant’s submissions characterised the respondent’s arguments as follows:

“Essentially, the Respondent is arguing that the Applicant was an employee from 4 October 2011 to 23 March 2020 and that from 23 March 2020 to 27 April 2020 the Applicant was not an employee. The Respondent argues that the Applicant was re-employed as an employee on [28] April 2020.”

[19] The applicant’s submissions disagreed with the respondent’s contention that the applicant’s employment was terminated between 23 March 2020 to 27 April 2020 and contended that the applicant had continuity of employment from 4 October 2011 and she would be a person protected from unfair dismissal.

[20] While accepting that an ESC was provided to the applicant, the submissions for the applicant included that:

•  the only reason an ESC was provided to the applicant was due to the fact the government had not yet announced JobKeeper;

•  the applicant and other employees were advised they would have their jobs once the respondent was able to open, and at no time were the applicant or other employees advised that their employment was terminated on 23 March 2020;

•  the applicant was not required to re-apply for her job and was simply provided shifts again once the COVID-19 restrictions were lifted;

•  instead of being a termination of the applicant’s employment, the events surrounding 23 March 2020 were akin to a COVID-19 stand-down and should be interpreted by the Commission in that way.

[21] The applicant disagreed with those parts of the respondent’s submissions that the applicant was “re-employed” on different terms and conditions; rather, the submissions for the applicant were that the applicant was engaged by the respondent on the JobKeeper scheme to work a minimum of 28 hours of work a week and for “keeping a connection with her employer”.

[22] The applicant’s submissions were that she “was technically an employee between 23 March 2020 and 27 April 2020 and has continuity of employment”. The applicant submitted that support for this contention also may be drawn from the evidence of two other witnesses whose view was that the “break” in employment was a COVID-19-related stand-down and not a termination of employment.

[23] The applicant’s submissions adverted to s.22 of the Act and its definition of continuous service, in contending that, as to meaning, “Essentially continuous service is a period during which the employee is employed by the employer”. The applicant submitted “[t]he question that will need to be considered by the Commission will be was the provision of a separation certificate (during a Government required shut down) a termination of employment or more akin to a stand down and, as such, an event which does not disrupt the employee/employer relationship.”

[24] As to the respondent’s reliance on Shortland, the applicant submitted the respondent did not make it clear to the applicant that there would be no further engagements. Indeed, the respondent advised the applicant that she would receive more shifts and that the ESC was simply to allow her to claim unemployment benefits until COVID-19 restrictions eased. The applicant’s submissions continued that “[t]he employment relationship was not broken as the Respondent did not make it clear (by either actions or words) that the “stand down” would end the employment relationship. Instead, the [C]ommission should consider it continuous employment.” The applicant submitted that the circumstances in Holland were distinguishable from those concerning the applicant, given the comparatively short period of absence due to a COVID-19 stand-down.

[25] The applicant’s submissions were that she is a person who was protected from unfair dismissal. Separately, the applicant also accepted that the respondent is a small business to which the Code would apply.

Consideration

[26] As a result of the impact of the COVID-19 restrictions, the respondent had no work for the applicant and most of its employees. In connection with those impacts:

•  the respondent continued to employ a skeleton staff of seven employees on half-pay and reduced hours after 23 March 2020;

•  the respondent terminated the employment of the applicant on 23 March 2020 (i.e., as the ESC noted, the employment ceased on 23 March 2020 due to the coronavirus; she was dismissed within the meaning of s.386(1)(a) of the Act albeit in what otherwise may have been characterised as a redundancy-type situation brought about by the COVID-19-related impacts on the business that crystallised on 23 March 2020);

•  the applicant was not stood-down from her employment on 23 March 2020 and, despite the submissions for the applicant, the applicant was not and did not remain “technically an employee” of the respondent in the period following 23 March 2020.

[27] An ESC is an Australian Government/Department of Human Services/Centrelink document which contains the following text:

“This document certifies employment information. Please read the information on page 1 before completing this form.

Please note: Personal information is protected by law and can be given to someone else only in special circumstances, where Commonwealth legislation requires or where you give permission. Giving false or misleading information is a serious offence.”

(Bold in original)

[28] In the respondent-prepared ESC concerning the applicant, the following details were recorded:

•  the “Date employee started working for you” was identified as “04 10 2011”;

•  the “Date employment ceased” was identified as “23 03 2020”;

•  the “Reason for separation” specified in the list of reasons was identified as “Other”, namely “CORONAVIRUS”.

[29] Ms Clarke, as I have noted earlier in the extract from her evidence-in-chief, described the circumstances which led to the decisions she made concerning the business. Ms Clarke also gave evidence that “After completing the Employment Separation Certificate, I understood that [the applicant’s] employment had been terminated at Gledswood.” I accept that was the case, albeit, it also may be noted, Ms Clarke’s evidence indicated she tried to convey hope to her employees about having “jobs to come back to”. For example, Ms Clarke said the following in a staff message on 23 March 2020:

“Morning team,

With last night’s announcement for licensed venues to cease trading at midday today, we have had the decisions made for us. We will have to close our doors for all events, except funerals.

I’m trying to make sense of this whole process.

Casual employees – please take up the government assistance that you are entitled to. We will all have jobs to come back to when this passes but in the meantime, I’ll email your separation certificate to you.

My brain is working overtime to find what our pivot point is to keep trading in some capacity – I’m open to all ideas. …

…

There will be a silver lining to this … please keep your eyes open for it.

I’m sorry that we are all in this situation – we’re in it together and if you are struggling mentally and emotionally, please reach out. …”.

[30] Ms Clarke’s evidence also indicated the following:

“It was always my intention to seek to re-employ [the applicant] and any other casual employees who had been terminated on 23 March 2020, once the government restrictions imposed upon my business eased. That said, until that time, I had issued the employment separation certificates to 22 casual employees, including [the applicant] because I had no work for them to do and so that they could either apply for social security benefits [or] seek to find employment elsewhere.”

[31] The applicant’s employment with the respondent ceased on 23 March 2020. The applicant was not employed by the respondent, or stood-down from her employment with the respondent, in the period following the ESC-identified cessation of the employment on 23 March 2020; and it was not a case of, for example, a casual employee not being offered shifts which may otherwise have been anticipated within the usual employment relationship.

[32] In a subsequent communication dated 22 April 2020 from Ms Clarke to employees, there was a link to information provided by Treasury concerning frequently asked questions concerning JobKeeper. It may be noted, in passing, that the link in such respects (relevantly) differentiates between employees who had been, respectively, stood-down after 1 March 2020 and those who had been “let go” and then re-hired after that date:

“IF I HAVE STOOD DOWN MY EMPLOYEES WITHOUT PAY AFTER 1 MARCH 2020 CAN I ‘BACK PAY’ THEM TO 30 MARCH 2020?

Yes. If you want to claim the JobKeeper Payment for your employees you will need to confirm your eligible employees want to be part of the scheme and arrange for them to be paid a minimum of $1,500 per fortnight before tax from 30 March 2020.

I LET MY EMPLOYEES GO AFTER 1 MARCH 2020. IF I RE-HIRE THEM, AM I ELIGIBLE TO RECEIVE THE PAYMENT?

Yes. You can receive the JobKeeper Payment if you re-hire any eligible employees you had at 1 March 2020. You can receive the payment even if you then need to immediately stand them down, so long as they remain employed.”

[33] The respondent (however described) re-employed, re-hired or re-engaged the applicant following the delineated cessation of employment on 23 March 2020, with the effective first date of the further employment commencing on 28 April 2020. In this respect, the applicant was one of eight out of the 22 casual employees to commence employment with the respondent under JobKeeper-related arrangements around that time. Other employees found alternative employment; others have not found alternative employment and have not been re-employed by the respondent under JobKeeper arrangements or otherwise. The casual employees who, along with the applicant were issued with ESCs on 23 March 2020 and who were not re-employed under JobKeeper-related arrangements around 28 April 2020, could not be considered to be (drawing from the terms used in the applicant’s submissions concerning the applicant) “stood-down” and/or “technically an employee” between 23 March 2020 “with continuity of employment”, for example, as at August 2020 when the hearing proceeded; but one corollary of acceptance of the applicant’s submissions would be that all the 22 casual employees (except the applicant, who was dismissed for alleged cause, and the others who were re-employed) remain stood-down and technically still employees of the respondent.

[34] The evidence in the case for the applicant comprised the evidence of the applicant personally and the evidence of two other witnesses who also had been employed by the respondent. The evidence of these three witnesses described their understanding of what happened around 23 March 2020 and/or how they “interpreted” what Ms Clarke had written in her message to staff on 23 March 2020. The general effect of the evidence of the three witnesses in the applicant’s case was that there were no terminations of employment on 23 March 2020 and they were not informed their employment was terminated; rather their understanding was that what occurred on 23 March 2020 involved stand-downs and/or that the employment was “on hold” or the subject of a “freeze/pause”; and that, to the extent ESCs were issued, the ESCs were issued only to assist in obtaining social security benefits. The evidence in such respects in the case advanced for the applicant does not lead me to conclude that the applicant was stood-down in the period 23 March 2020 to 27 April 2020.

[35] Section 117 of the Act provides that an employer must not terminate an employee’s employment unless the employer has given the employee written notice of the day of termination (which cannot be before the notice is given). Despite the applicant’s submissions that the respondent did not provide written advice to the applicant that her employment had terminated, the applicant was given the written advice of the date of the cessation of her employment with the respondent via the ESC. As to the applicant’s submissions that she did not need to “re-apply” to work with the respondent, this is because the respondent’s Ms Clarke took the initiative in approaching the applicant along with certain other employees, who were then re-employed under JobKeeper-related arrangements from on or about 28 April 2020.

[36] In a matter which garnered some attention in the proceedings in connection with the 23 March 2020 termination of employment, the respondent did not indicate in the applicant’s ESC that any long service leave payment was paid or will be paid to the applicant (in circumstances where the applicant had a presumptive entitlement to a pro rata payment under the Long Service Leave Act 1955 (NSW) in conjunction with the termination of employment). The fact the applicant was not paid pro rata long service leave in connection with the termination of employment on 23 March 2020 does not lead me to conclude that the applicant continued to be a casual employee of the respondent in the period following 23 March 2020, or the subject of a stand-down following 23 March 2020. It may be noted, in passing, that the respondent’s representative indicated in the hearing he has provided advice to his client about rights and obligations concerning long service leave, and his client is cognisant of such matters. Ms Clarke said that long service leave was not paid around 23 March 2020 as a result of the “panic” around that time. Ms Clarke also indicated that she has been prepared to pay long service leave subject to the outcome of this decision concerning the applicant’s contentions that the employment did not cease on 23 March 2020.

Conclusion

[37] I accept the submissions for the respondent concerning its minimum employment period objection. The applicant was not, at the time of her dismissal on 18 May 2020, a person who was protected from unfair dismissal – and this is so notwithstanding her earlier service in the period 4 October 2011 to 23 March 2020. In the circumstances, an order will be issued in conjunction with this decision dismissing the application.

[38] The proceedings are concluded.

COMMISSIONER

Appearances:

M Alkan, paid agent, for Jane Aming.
N Chadwick, solicitor, for Gledswood Homestead & Winery Pty Ltd.

Hearing details:

2020.
Sydney (by telephone):
August 6.

Printed by authority of the Commonwealth Government Printer

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