C2014/3145, Transcript of Proceedings [2014] FWCTrans 219 (16 April 2014)

TRANSCRIPT OF PROCEEDINGS

---

Fair Work Act 2009 1049808-1

JUSTICE BOULTON, SENIOR DEPUTY PRESIDENT
DEPUTY PRESIDENT SAMS
COMMISSIONER BULL

C2014/3145

s.604 - Appeal of decisions

Mr Daniel Bunt
and
ITW Proline
(C2014/3145)





Brisbane

10.08AM, FRIDAY, 4 APRIL 2014

Reserved for Decision

PN1

JUSTICE BOULTON: Yes, good morning, can we have the appearances, please.

PN2

MR R. KERR: My name is Kerr, initial R.J. I seek leave to appear on behalf of the appellant.

PN3

JUSTICE BOULTON: Yes, thank you.

PN4

MS P. STUCKEY-CLARKE: And Stuckey-Clarke, initial P., from the Australian Federation of Employers and Industry on behalf of the respondent and, with me, is MR R. SLAVIC from ITW Proline.

PN5

JUSTICE BOULTON: Yes, good, thank you. Now, is there any objection to Mr Kerr’s appearance?

PN6

MS STUCKEY-CLARKE: No, there is not.

PN7

JUSTICE BOULTON: And you are seeking to appear. Permission on the basis of relevant - what grounds?

PN8

MR KERR: The matter pertains largely to points of law, your Honour. With respect to the appeal we submit that there was an error in law. In light of relating to grounds of law we think that today would work much better and quicker had Mr Bunt received legal representation.

PN9

JUSTICE BOULTON: Good, yes, we grant permission for your appearance, Mr Kerr.

PN10

MR KERR: Thank you, your Honour.

PN11

JUSTICE BOULTON: Yes, now, you’ve given us a written outline of your submissions. I’ll mark that for the purposes of the record as exhibit K1.

EXHIBIT #K1 APPELLANT'S OUTLINE OF SUBMISSIONS

PN12

MR KERR: Thank you, your Honour. If I may hand up to your Honours the precedents that are relied upon in our submissions.

PN13

JUSTICE BOULTON: Yes, good, thank you.

PN14

MR KERR: I acknowledge, your Honour, that the appellant is required to seek leave in order to appeal. The outlines or the grounds upon which the appellant seeks leave is set out in paragraph 2 of attachment A of the form 7 that was originally filed, at paragraph 3 of the notice of appeal, form 7, and at paragraph 9 of the appellant’s outline of submissions. I intend address the issues of leave as I progress throughout my submissions, if that’s okay with the commission’s members.

PN15

Today’s appeal, your Honours, is in relation to Simpson C’s decision regarding a jurisdictional objection as to whether the appellant was employed or could be considered an employee of the respondent with regard to section 382 of the Fair Work Act. The matter arises from a labour hire arrangement whereby the respondent is a principal who hired the appellant from a labour hire agency. This matter is made somewhat more extraordinary by the respondent’s agreement to include in its enterprise agreement clause 4.2.4 which can be found at page 62 of the appeal book.

PN16

We outline it in more detail in our submissions but clause 4.2.4 states that:

PN17

Casuals employed either by the company or through a labour hire agency on a continuous service period for longer than 12 months will be deemed to be a permanent employee.

PN18

The appellant respectfully submits that Simpson C erred at law in making his finding that the appellant was not an employee of the respondent for the purposes of section 382. The appellant’s outline of submissions provide in detail the grounds upon which the appellant respectfully submits Simpson C erred in his decision and we do not intend to go into great detail of re-reading the outline of submissions. We will, however, for the sake of brevity address them under two basic headings, the first being whether the appellant is actually covered by the enterprise agreement in the first place, and the second being whether the enterprise agreement gives rise to the appellant being employed by the respondent for the purposes of section 382.

PN19

With respect to the appellant being covered by the enterprise agreement, Simpson C at paragraph 22 of the decision, and this can be found at page 4 of his appeal book, stated:

PN20

The asserted operation on behalf of the appellant has the effect of extending the coverage and operation of the agreement to a person whom the applicant concedes was not an employee of the respondent when the agreement was made.

PN21

The appellant respectfully submits that whether the appellant was an employee of the respondent at the time the agreement was made is not relevant as it has been well accepted and well introduced that an employee who is employed after the making of an enterprise agreement shall be covered if it is stated within the adequate provisions of the Act.

PN22

Section 53(1) of the Act states:

PN23

An enterprise agreement covers an employee or an employer if an agreement is expressed to cover, however described, the employee or the employer.

PN24

Clause 1.6 sub (3) of the enterprise agreement then proceeds to describe the parties that:

PN25

The enterprise agreement shall be binding on as all employees whether of the National Union of Workers or whose employment is at any time when the agreement is in operation subject to that agreement.

PN26

The appellant submits that, by virtue of clause 4.2.4 deeming the appellant to be a permanent employee, he becomes subject to the agreement in accordance with clause 1.6(3) and is therefore an employee however described in accordance with section 53(1) of the Act. It is on those grounds that the appellant submits that he is covered by the enterprise agreement.

PN27

Simpson C then in his decision, which can be found in paragraphs 19 to 23 and again on pages 3 and 4 of the appeal book, went on to consider whether or not clause 4.2.4 was in fact a valid clause in the sense as whether or not it was a permitted matter in relation to section 172 of the Act. The appellant respectfully submits that the Commissioner erred in his decision that it was not a permitted matter and refers to the explanatory memorandum which you will find in your bundle, whereas it states at clause 672.3:

PN28

Section 172(1)(a) is to include a permitted matter with respect to conditions or requirements about employing casual employees or engaging labour hire or contractors if those terms sufficiently relate to an employee’s job security.

PN29

Also again at clause 672.4 of the explanatory memorandum terms that would provide that casual employees are converted to permanent employees after a set period of time. It’s the appellant’s submission therefore that this does - it is part of its intent that such a clause as clause 4.2.4 is to be considered a permitted matter in as far as section 172 is concerned of the Act.

PN30

COMMISSIONER BULL: But, Mr Kerr, isn’t that explanatory memorandum referring to the existing employees, not someone who hasn’t actually been employed? How does that affect someone else who hasn’t been employed job security?

PN31

MR KERR: The appellant read it, your Honour, as being affecting labour hire agencies with respect to job security.

PN32

COMMISSIONER BULL: And how do you read that as affecting labour hire people’s job security? It talks about an agreement and the existing employees surely.

PN33

MR KERR: Certainly, your Honour, with respect to the labour hire agencies coming on, the purpose of clause 4.2.4 as can be read throughout clause 4 is to ensure that labour hire employees are not hired on a long-term service and therefore subjecting permanent employees at taking their position.

PN34

COMMISSIONER BULL: Where are you taking us? It says relates to the employee’s job security. Your client wasn’t an employee.

PN35

MR KERR: It’s our submission, your Honour, that he was an employee with respect to the clause 4.2.4 deeming him to be so.

PN36

COMMISSIONER BULL: Yes, but that’s only after the 12 months has come into effect you say?

PN37

MR KERR: That’s right. Yes, your Honour.

PN38

COMMISSIONER BULL: So you’re saying that the explanatory memorandum in terms of job security refers to the security of people who aren’t employees?

PN39

MR KERR: Inasmuch as it refers to the security of people that are through labour hire agencies and their impact upon employees, your Honour.

PN40

DEPUTY PRESIDENT SAMS: Mr Kerr, how does a term of an agreement between two parties, here the union and the company, impose obligations on a party that has nothing to do with the agreement?

PN41

MR KERR: Our submission is that they do by virtue of section 53(1) of the Act that he is part of the agreement because it is however described and he is subject to the agreement as soon as he has worked that one year.

PN42

DEPUTY PRESIDENT SAMS: I’m not talking about the employee, I’m talking about the company now, the labour hire company.

PN43

MR KERR: Well, it’s our submission, your Honour, that the labour hire company is not part of the agreement, no.

PN44

DEPUTY PRESIDENT SAMS: Well, that’s my point. How does an agreement term purport to cover or impose obligations on another employer who has nothing at all to do with the agreement?

PN45

MR KERR: It’s our submission, your Honour, that the relationship between the labour hire company and the appellant is not what is covered by the enterprise agreement, as you’ve rightly said. The submission of the appellant is that, once that one year is created, he’s then deemed to have been an employee of the respondent. The relationship between the labour hire agency and the respondent is not of relevance here as such as they shouldn’t have entered into an agreement that went beyond what the respondent was able to contract.

PN46

The submission would simply be that he is limited by that provision of the enterprise agreement as section 50 of the Act states that it is a civil remedy provision if a person does not adhere to or breaches an enterprise agreement. So the relationship between the labour hire agency is not covered by the enterprise agreement, rightly so, but at the same time the respondent shouldn’t have entered into an agreement with the labour hire agency for his employment to have gone beyond one year.

PN47

DEPUTY PRESIDENT SAMS: Well, why should you travel down that path? That sort of arrangement is not before the commission and certainly not before us.

PN48

MR KERR: Well, your Honour, that relationship is not of knowledge to the appellant. That’s a commercial relationship between the labour hire agency and the - - -

PN49

DEPUTY PRESIDENT SAMS: I’m not criticising it. Just answer me this then: let’s say the 12 months ticks over exactly and the labour hire agency says - company says, “I want you to work somewhere else because you’re my employee.” What happens then?

PN50

MR KERR: Well, that would obviously have to be a matter, I guess. The appellant would submit therefore that he is no longer the employee of that. The agreement should not have lasted longer than a year.

PN51

DEPUTY PRESIDENT SAMS: But how could you take the employee of another employer?

PN52

MR KERR: In the sense that the agreement should not have lasted longer than the year because of this enterprise agreement. It was the understanding that the offer and the acceptance were essentially put to the appellant and the respondent and therefore from that one year that was when the new contract had existed.

PN53

COMMISSIONER BULL: Mr Kerr, just going on what the Deputy President said, so if the labour hire company employed your client, which they did and they worked for some time somewhere else, but because they go and get some work for the particular reason that’s been expressed there on submissions with the respondent, you say that after 12 months with any action by the labour hire company your client either resigns or is terminated by the labour hire company. Is that right?

PN54

MR KERR: Yes, that is the submission of the appellant.

PN55

COMMISSIONER BULL: Even though none of those two things happened?

PN56

MR KERR: You’re right in the sense, your Honour, that that didn’t happen in fact. However, it is the submission of the appellant that that’s exactly what should have happened. The issue is whether there is an employee-employer relationship with regards to 382. Taking into effect obviously the grounds of control, which we recognise a ruling in FP v Tooheys whereby it’s not in and of itself a defining matter, but that combined with the clear intention of clause 4.2.4 and the ramifications of the respondent contravening the Act by not following clause 4.2.4, that was the clear intention of the respondent in keeping the appellant for longer than a year and it was a clear intention of the appellant for working longer than a year.

PN57

COMMISSIONER BULL: So what happens if your client said, “I don’t want to be a permanent employee of this company. I want to remain a casual with my labour hire company”? He doesn’t have any choice to do that.

PN58

MR KERR: Well, that would be a matter that could be waived surely by express provision of the contract?

PN59

COMMISSIONER BULL: What contract?

PN60

MR KERR: Well, there’s an implied contract at the moment but, if it was expressed from the appellant that he wished to remain in the employ of the labour hire company, then that may be so. I admit that clause 4.2.4 is an unusual clause in that it doesn’t pose an onerous obligation upon the respondent. Nevertheless, it is a clause that exists in the enterprise agreement and it has passed and it clearly states that will be deemed to be a permanent employee. Now, the submission of the appellant is that is with respect to having the provisions and the protections that are afforded under the enterprise agreement and the Act in as far as an unfair dismissal claim is concerned.

PN61

COMMISSIONER BULL: Yes, thank you.

PN62

JUSTICE BOULTON: Mr Kerr, can I just clarify a couple of factual matters? Now, I understand it’s not in contest that the appellant entered into a casual employee agreement with the labour hire agency in October of 2009?

PN63

MR KERR: That’s correct, your Honour.

PN64

JUSTICE BOULTON: Now, it’s not in contention that the appellant performed duties for the respondent between April 2011 and July 2013?

PN65

MR KERR: That’s right, yes, your Honour.

PN66

JUSTICE BOULTON: And those duties then came to an end in July 2013?

PN67

MR KERR: That’s correct, yes.

PN68

JUSTICE BOULTON: Now, after that time, has the appellant continued, as it were, to work for the labour hire agency?

PN69

MR KERR: The appellant hasn’t had the opportunity to gain further work. He has, if it were though, remained on the books of the labour hire agency - - -

PN70

JUSTICE BOULTON: Sorry, he’s remained - - -

PN71

MR KERR: On the books, if it were, but has not actually performed duties.

PN72

JUSTICE BOULTON: So has there been another, as it were, casual employee agreement entered into?

PN73

MR KERR: NO, your Honour.

PN74

JUSTICE BOULTON: And in the period between October 2009 and April 2011 the applicant was assigned different duties?

PN75

MR KERR: Yes, your Honour, that’s correct.

PN76

JUSTICE BOULTON: On a more regular basis or?

PN77

MR KERR: Yes, your Honour.

PN78

JUSTICE BOULTON: Do you say that the appellant is employed by the labour hire agency now?

PN79

MR KERR: It would seem certainly from the cases that have been made that it appears that if an employee is on the books of a labour hire agency then it has been seen - or it’s my understanding, I’m sorry, I don’t have the cases in front of me - but it does appear that they are seen as being employed by the agency.

PN80

JUSTICE BOULTON: But you say the appellant hasn’t received any work through the agency since July.

PN81

MR KERR: That’s right, yes, your Honour.

PN82

JUSTICE BOULTON: Now, was there any evidence about that he received other work?

PN83

MR KERR: No, there wasn’t.

PN84

COMMISSIONER BULL: Just on that point that his Honour has raised with you, the respondent’s submissions originally to the Commissioner at paragraph 17, do you have those handy?

PN85

So the applicant’s employment with PIW did not end at the time alleged by the applicant. PIW continued to offer employment to the applicant for several months after the respondent no longer required his services as provided by PIW.

PN86

You disagree with that, do you? It sounds like it. They’re in the appeal book, sorry, page 33.

PN87

MR KERR: Yes, we do disagree with that, your Honour. I’m instructed that after working for the respondent he did not perform any more duties or any more work for the labour hire company.

PN88

COMMISSIONER BULL: All right, thank you.

PN89

JUSTICE BOULTON: Now, Mr Kerr, I suspect a very large part of your case depends on clause 4.2.4 of the enterprise agreement.

PN90

MR KERR: That’s the sole submissions, your Honour, is with respect to clause 4.2.4. I would also like to state, your Honour, that despite the outline of submissions the appellant won’t be challenging Simpson C’s ruling on the doctrine of joint employment and the ability to implement that by the commission.

PN91

JUSTICE BOULTON: So you’re not challenging the ruling in terms of joint employment?

PN92

MR KERR: That’s correct, your Honour.

PN93

JUSTICE BOULTON: Well, look, if you look at clause 4.2.4 it talks about casuals who are employed, and that word is important, either by the company or through a labour hire agency on a continuous service period of longer than 12 months will be deemed to be permanent employees. Now, the clause actually doesn’t say permanent employees of the company. It simply says that they will be deemed to be permanent employees.

PN94

Now, I know you’re saying that, you know, the way you’re reading that it’s implied that they should be permanent employees of the company, but if you go to the argument that you just put to us in relation to whether it was a permissible matter and clause to have in the agreement and the passage that you’ve taken us to in the explanatory memorandum, effectively that passage is saying that if you have a clause in an agreement which says that you can’t have labour hire people on terms which are less than the terms which apply to the regular employees, that’s actually an argument for saying, well, the clause might be intended to be read that if you’re going to make your employees who are casual to be permanent employees after 12 months, a similar arrangement should apply in relation to labour hire casual employees, so as it were not to disadvantage the employees of the company who are casuals and who would become permanent employees.

PN95

That would tend to suggest that the way you should read 4.2.4 is not that these people are going to become permanent employees of the company but, rather, that they might be treated as permanent employees of the labour hire agency. Now, I’m not suggesting that a clause in an agreement that the labour hire agency is not party to is going to have that effect in law in relation to the relationship between the labour hire agency and any of its employees but I’m at least raising it as a matter which may somehow inform what might be the proper interpretation or purpose of clause 4.2.4.

PN96

MR KERR: Certainly, your Honour, and obviously we certainly respect that. Respectfully, however, we would disagree for the grounds that you have outlined. It is the appellant’s submission that the entirety of clause 4.2 is to ensure that the permanent employees of the company cannot be reduced - or the appellant submits, sorry, that the permanent employees of the company cannot be reduced in substitute of the labour hire agreements. It would appear that the purpose of clause 4.2.4 is to ensure that, if the company or the respondent, sorry, is going to employ labour hire employees, then they’re not going to do so on a permanent basis without making them in fact employees and therefore given the rights of the enterprise agreement and subsequently the Fair Work Act. That would be the appellant’s submission with respect to how clause 4.2.4 should be interpreted, your Honour.

PN97

Moving on from the coverage of the enterprise agreement, the other issue that the Commissioner raised and ultimately decided against the appellant was whether or not it arose to creating this relationship between the employer and the employee. The Commissioner stated that it was absent the essential elements of a contract in creating such a relationship. I won’t go over in detail what is in the outline of submissions but the appellant submits that there was in fact offer, acceptance of intention and consideration by both parties to be a permanent employee of the respondent. With respect to the consideration, which is obviously probably the most obvious, that and the intention, the appellant submits in the alternative that the consideration either flowed through the labour hire agency from the respondent as soon as clause 4.2.4 became effective or, in the alternative, it was as subsequent and, as the member pointed out, I am criticising necessarily the contract between the two parties, but essentially it was an error, if you will, between the labour hire agency and the respondent who were not addressing and adhering to clause 4.2.4 in making him a permanent employee.

PN98

JUSTICE BOULTON: Sorry, just going back, I meant to clarify this when I was asking you about agreed facts. Do we know how many hours the appellant was working for the company each week?

PN99

MR KERR: Full week, 38 hours. I’m instructed full week, 38 hours.

PN100

JUSTICE BOULTON: So he was employed 38 hours per week?

PN101

MR KERR: Yes, that’s right.

PN102

JUSTICE BOULTON: For that whole period April 2011 to July 2013?

PN103

MR KERR: If you will, your Honour, I might get the appellant to explain the hours to you. It might be a bit easier than passing through it, if that’s acceptable to you?

PN104

JUSTICE BOULTON: Well - - -

PN105

MR KERR: Prefer not to?

PN106

JUSTICE BOULTON: I’m merely just asking you if these are agreed facts which were before the commission. I’m not necessarily asking you for any fresh evidence.

PN107

MR KERR: Certainly, your Honour. No, they weren’t before the Commissioner, the hours worked.

PN108

JUSTICE BOULTON: Sorry?

PN109

MR KERR: They were not before the Commissioner pertaining to the hours worked.

PN110

JUSTICE BOULTON: Okay. What difference would it make if you’re a casual employee as distinct from a permanent employee?

PN111

MR KERR: Ultimately there would not be as much of a difference with respect to the coverage of 382 due to his length of service that he’s provided for the respondent. So if the appellant was a casual employee he would be able to fall under the provisions of having worked a substantial time and being considered an employee of the company even though he was casual. The obvious concern is that, due to the labour hire arrangement, the question that comes before the commission is who is the employer which normally is clear that it sits with the labour hire company. However, the distinguishing factor here is clause 4.2.4 deeming him a permanent employee and what the subsequent effect of that is.

PN112

JUSTICE BOULTON: Wouldn’t you say that a permanent employee has a different range of entitlements, in particular to pay and to leave, than a casual employee would have?

PN113

MR KERR: Yes, absolutely.

PN114

JUSTICE BOULTON: And is there any evidence in this particular case that the appellant was paid other than as a casual during the entire period that he was, as it were, working at the respondent’s business?

PN115

MR KERR: No, your Honour, there isn’t. The appellant would submit that this was an error in ways and that payment should have adjusted or should have changed in accordance with clause 4.2.4. However, that did not happen.

PN116

COMMISSIONER BULL: It wasn’t raised by your client though.

PN117

MR KERR: Sorry, your Honour.

PN118

COMMISSIONER BULL: It wasn’t raised after 12 months why your client didn’t go for casual or permanent.

PN119

MR KERR: No, that’s correct, your Honour.

PN120

COMMISSIONER BULL: But that’s then in case he wasn’t aware of it.

PN121

MR KERR: I have to be careful here because the evidence of whether the appellant was aware of it was not before Simpson C at the time. However, in accordance with the enterprise agreement, the enterprise agreement was in plain sight on the premises for all employees to see and we are instructed, albeit that he was aware of the clause.

PN122

JUSTICE BOULTON: And the position through the whole period was that the appellant was paid by the labour hire agency?

PN123

MR KERR: Yes, your Honour.

PN124

JUSTICE BOULTON: I asked you about the hours and the answer is it wasn’t before the Commissioner what the exact hours that he worked or how the pay might have differed during that two-year period?

PN125

MR KERR: That’s right, your Honour.

PN126

MS STUCKEY-CLARKE: Your Honour, if I may just correct one point, at page 48 of the appeal book in Mr Robert Verco’s statement, it wasn’t admitted as evidence but was in the material before the Commissioner at first instance, page 48, paragraph 10, during the time Daniel Bunt worked at the Banyo site, he averaged approximately 31 hours per week between April 2011 and July 2013. I don’t know if that clarifies the matter for your Honour.

PN127

JUSTICE BOULTON: So do we assume that that was what the company was being billed for by the labour hire agency?

PN128

MS STUCKEY-CLARKE: On average, yes.

PN129

DEPUTY PRESIDENT SAMS: Well, Mr Kerr, if you’re right and the appellant became automatically a permanent employee after 12 months, wouldn’t he have an underpayment claim?

PN130

MR KERR: That may be so, your Honour.

PN131

DEPUTY PRESIDENT SAMS: Well, the obvious question is who would be liable?

PN132

MR KERR: Certainly. At this stage, your Honour, we haven’t turned our mind to such a question.

PN133

DEPUTY PRESIDENT SAMS: Well, I don’t want to complicate it but your submission raised a whole range of interesting - - -

PN134

MR KERR: We are - - -

PN135

DEPUTY PRESIDENT SAMS: It has interesting consequences.

PN136

MR KERR: We are absolutely aware of that, your Honour. The only reason obviously that we are here is because of the peculiar nature of clause 4.2.4. The appellant is perfectly aware of the ramifications of such. However, the appellant can only reiterate that it was agreed to be included by the respondent and it essentially deems the appellant to be a permanent employee and therefore the appellant should be afforded such protections, if you will, under the enterprise agreement and subsequent Fair Work Act.

PN137

DEPUTY PRESIDENT SAMS: But the principles of contract law are that a party offers a contract and the receiving party accepts it.

PN138

MR KERR: Yes, your Honour.

PN139

DEPUTY PRESIDENT SAMS: Well, in this scenario neither happened.

PN140

MR KERR: It’s the appellant’s submission that the offer was made at large with the inclusion of clause 4.2.4 in its agreement, the offer being that if you are a labour hire agent and you work for us for a year then you will be deemed a permanent employee. The offer was then accepted impliedly as submitted by the appellant by continual service beyond that one-year period.

PN141

COMMISSIONER BULL: But, Mr Kerr, how does deeming someone to be a permanent employee after the effluxion of a certain period of time constitute an offer?

PN142

MR KERR: The offer is essentially that, that it will be deemed.

PN143

COMMISSIONER BULL: That’s not an offer, is it?

PN144

MR KERR: It’s the appellant’s submission that - - -

PN145

COMMISSIONER BULL: Where does your client get the right to say, “No, I don’t want to accept that?”

PN146

MR KERR: It will be our submission, your Honour, that it would be by not working beyond the year.

PN147

COMMISSIONER BULL: So if he wants to stay as a casual, he can’t because there’s no opportunity under this agreement to do so?

PN148

MR KERR: If he wants to stay as a labour hire agent, it is the appellant’s submission that he can’t, that’s right.

PN149

JUSTICE BOULTON: There’s no evidence that he, as it were, terminated or wanted to terminate his arrangement with the labour hire agency?

PN150

MR KERR: No, your Honour, there isn’t any evidence to such. However, the ramifications of such should not have adverse consequence on this relationship between the respondent and the appellant is the submission.

PN151

JUSTICE BOULTON: So if there’s no evidence that he did that, effectively what you’re saying is that after 12 months he had two employers?

PN152

MR KERR: The submission with respect to two employers is in the alternative and twofold, the first being that the labour hire agency and the respondent both being aware, we submit, or at least should have been aware of clause 4.2.4. Then in order to not contravene the enterprise agreement by the respondent the labour hire agent became an agency of sorts or an administrator of sorts such as the case in the AMT v Nguyen case or, in the alternative, it was a lack of foresight in the relationship between the labour hire agency and the respondent to correctly address the payment measures.

PN153

JUSTICE BOULTON: It’s a bizarre submission because if that happened you’ve got something happening after 12 months which affects the employment status of someone. On the side of the company you’ve got no action being taken, as it were, to acknowledge the change of the employment status. You’ve got no action being taken to change the way in which a person is paid or, I assume, is treated in the workplace. Then on the employee’s side you’ve again got no action to either terminate a previous arrangement with the labour hire arrangement, to have pay adjusted or conditions adjusted, to have hours changed or anything else but you’re saying that somehow, after 12 months, the legal position of everybody changed but there’s no evidence that anything changed in terms of the way in which the relationship had been going.

PN154

MR KERR: It’s the appellant’s submission that the lack of change that happened was in essence - and there hasn’t been any pleadings or submissions made against this - but there is the possibility that it may have been a contravention of the enterprise agreement for the respondent to not change the payment as clause 4.2.4 should have done. The failure on the respondent’s behalf to do so should not, in the appellant’s submission, have an adverse consequence to the appellant.

PN155

JUSTICE BOULTON: Yes, but it would suggest that the change or the effect of that clause that you’re contending for is not an effect which any party realised, appreciated, acted upon or expected, and it’s really just something that has arisen, as it were, after the event and has been looked back on as having some effect which at the time that you say there was offer, acceptance, consideration, nobody who was party to any of these arrangements had any idea that these things were going on or having any legal effect by what you contend. The agreement might have been posted in the workplace but there’s no evidence that, you know, the appellant was looking at that agreement and demanding or taking any action after 12 months to secure any different treatment in regard to his engagement.

PN156

MR KERR: Yes, your Honour, and obviously we understand that. The appellant would submit that by working beyond the year, and I can only reiterate really, by working beyond the year it was implied that it was accepted and the reason that it only comes to light now was when the right needed to be challenged and that’s why it comes to fruition at such a late stage.

PN157

COMMISSIONER BULL: Mr Kerr, this is the genesis in an unfair dismissal application. Is that right?

PN158

MR KERR: Yes, it is.

PN159

COMMISSIONER BULL: So what action did the respondent take to terminate your client?

PN160

MR KERR: He called the people who were labour hire employees and told them they would no longer be needing their services. That was essentially the ending of the engagement, if you will, for want of a better description.

PN161

JUSTICE BOULTON: That was one on 2 July?

PN162

MR KERR: When they notified him, yes, your Honour.

PN163

JUSTICE BOULTON: And then the actual last day of work was 14 July?

PN164

MR KERR: That’s right.

PN165

JUSTICE BOULTON: So there was, in some ways, two weeks’ notice given.

PN166

MR KERR: Yes, that’s correct.

PN167

JUSTICE BOULTON: Yes, and we don’t know - and again I’m not sure if it might be in the factual material - but at that time presumably the company also communicated with the labour hire agency to inform - - -

PN168

MR KERR: It’s our understanding, yes, there is correspondence from the labour hire agency notifying the appellant of same.

PN169

JUSTICE BOULTON: And is there correspondence from the labour hire agency notifying the various employees about that situation?

PN170

MR KERR: Yes, there is, your Honour.

PN171

JUSTICE BOULTON: Which all would go to suggest there’s still an employment relationship with the labour hire agency.

PN172

MR KERR: Arguably, yes, but at the same time I can only rely on our material and submissions that the labour hire agency either was filling an administrative function or the consequences of the labour hire agency and the respondent not adhering to the enterprise agreement should not be of a negative consequence of the appellant.

PN173

DEPUTY PRESIDENT SAMS: Do you know how many other employees of - well, I’ll say employees of the labour hire agency - were terminated at the time?

PN174

MR KERR: No, I don’t have instructions to that. Maybe my friend - - -

PN175

MS STUCKEY-CLARKE: Your Honours, if I may draw your attention again to the statement of Robert Verco, particularly at page 49 of the appeal book, which addresses the declining need for agency casuals, as they’re referred to, in the statement and refers to the discussions had between representatives of the labour hire agency and the labour hire employees including the appellant and also attaches to that an attendance record at a particular meeting on 20 June 2013 where the discussion topic at that point was work had to finish up at ITW 12^th of the 7^th. That was again in the material before Simpson C at first instance. My understanding is that five other employees ceased in the same - continuing to work at the Banyo site in the same week that the appellant ceased to work.

PN176

DEPUTY PRESIDENT SAMS: Well, it seems in paragraph 7 of that statement that five of them, including Mr Bunt, had commenced in April 2011.

PN177

MS STUCKEY-CLARKE: Yes, that’s correct.

PN178

DEPUTY PRESIDENT SAMS: So they all had service in excess of certainly 12 months.

PN179

MS STUCKEY-CLARKE: Yes, the need for agency casuals at that particular site increased dramatically as a result of the fire in New South Wales.

PN180

DEPUTY PRESIDENT SAMS: Yes, I read that.

PN181

MS STUCKEY-CLARKE: Which led to that increase.

PN182

COMMISSIONER BULL: Mr Kerr, sorry to stay on this point but you say that the enterprise agreement was in the lunch room. Is that right? Or noticeboard somewhere?

PN183

MR KERR: Noticeboard somewhere, yes.

PN184

COMMISSIONER BULL: Right, so are you saying that because it’s on the noticeboard that was an offer to your client, is it, or do you say that your client read the agreement and accepted the offer?

PN185

MR KERR: We say that it was because it was on the noticeboard it was an offer to the world at large at that time.

PN186

COMMISSIONER BULL: You don’t say that your client read the enterprise agreement and assumed he was a permanent employee?

PN187

MR KERR: We denied that evidence in front of Simpson C - no.

PN188

COMMISSIONER BULL: All right, thank you.

PN189

MR KERR: So in conclusion, your Honours, I won’t reiterate the point. Obviously the submissions, as you know, are on clause 4.2.4 and its peculiarity. We do submit, however, that it is in the public interest, the consideration of this matter, because it does have, as the member has already stated, possibility for ramifications with the interpretation of the respondent and its employment staff which there are 300-fold and they do use labour hire employees previously and we suspect in the future. It also goes to possible drafting of enterprise agreements in the future and the ramifications of including labour hire agencies in such clauses and, upon that, that’s essentially all the appellant has to say at this time.
Thank you, your Honours.

PN190

JUSTICE BOULTON: Good, thank you. Ms Stuckey-Clarke.

PN191

MS STUCKEY-CLARKE: Thank you, your Honour, we do rely on the submissions filed in this matter on appeal and also on those filed at first instance and I certainly don’t intend to repeat the content of those submissions today.

PN192

JUSTICE BOULTON: Right, the respondent’s outline of submissions, it’s dated 31 March, I’ll mark that as exhibit S1.

EXHIBIT #S1 RESPONDENT'S OUTLINE OF SUBMISSIONS DATED 31/3/14

PN193

MS STUCKEY-CLARKE: The respondent also has for each member a copy of the authorities cited. I understand there will be some replication across the two.

PN194

JUSTICE BOULTON: Yes, thank you.

PN195

MS STUCKEY-CLARKE: I had initially thought that it would be useful to recap the matters that were understood between the parties but my understanding is now, having heard the applicant’s case and the commission’s understanding of the matters, it won’t be necessary to recap what is understood between the parties. Suffice to say, the existence of a contract wasn’t accepted by Simpson C and, on the facts before him, the respondent is of the firm view that that was the correct finding.

PN196

As was the focus in GlaxoSmithKline Australia Pty Ltd v Makin (2012) FWA 5343, the focus in this matter is on whether it’s in the public interest to grant permission to appeal the decision of Simpson C. That test is a stringent one and, in essence, requires the commission to appeal that it is the community at large rather than just the individual. Whether this appeal is in the public interest wasn’t addressed by the appellant in the written submissions filed on 18 March. They were, however, listed in the notice of appeal, form F7, and it is the respondent’s position that those bases are not satisfactory to warrant the commission granting permission to appeal in this matter.

PN197

The first two matters - that the matter pertains to the application of an enterprise agreement to a labour hire employee and that the matter speaks clarity regarding the relationship of a labour hire employee and a principal - both concern the relationship between a labour hire employee on the one hand and either an enterprise agreement or the host employer on the other - these considerations are not relevant for the commission today as it really is a question of whether the appellant was an employee of the respondent. The answer to which the respondent firmly contends was no.

PN198

Item 3, that the matter pertains to whether an enterprise agreement can amount to a contract of employment, in the respondent’s submission it should not be entertained as the principles regarding the prerequisite for the formation of a contract are firmly settled. So as a consequence of those three grounds, if you like being inadequate to form grounds for allowing the appeal to proceed, we would say that this matter is not in the public interest.

PN199

Having said that, it is the respondent’s position that Simpson C has not made an appealable error either by making a significant error of fact or an error of law. The respondent has answered each of the points raised by the appellant in written submissions but, just to summarise five central aspects of that position: the Commissioner identified the undisputed facts and applied them to the case; the Commissioner understood the applicant’s pleadings to the effect of the provision of the enterprise agreement and its purported impact on the employment relationship; also the Commissioner understood the applicant’s submissions in relation to the doctrine of employment and the application of the control test. These were considered in the findings as those matters were sound. Further, the Commissioner correctly identified the need for the elements of contract of employment to be present; and correctly considered the requirements relating to whether a matter is a permitted matter within an enterprise agreement.

PN200

We also further submit that the Commissioner did not, as alleged, purport to limit the coverage of an enterprise agreement to only employees at the time of employment. Even if the commission finds against us on those last two matters, the respondent submits that the commission should exercise its discretion not to grant the appeal for two primary reasons: the appeal has not prospects of success for failure to demonstrate the existence of a contract of employment between the appellant and the respondent; and, secondly, the appeal is not in the public interest. I don’t propose to give any further submissions unless of course there are questions from the bench.

PN201

COMMISSIONER BULL: Well, Ms Stuckey-Clarke, the appellant says that your outline of submissions at page 33 are incorrect, do you resile from that or not?

PN202

MS STUCKEY-CLARKE: Paragraph 33 of our outline of submissions?

PN203

COMMISSIONER BULL: Paragraph 17.

PN204

MS STUCKEY-CLARKE: Sorry, your Honour, of our original submissions?

PN205

COMMISSIONER BULL: Yes, page 33 of the appeal book. I took Mr Kerr to that paragraph 17. He says that that’s not right. Do you still maintain that position or not?

PN206

MS STUCKEY-CLARKE: The respondent’s position is that is the respondent’s understanding that the applicant was offered work. He didn’t take up that work but that the labour hire agency continued to offer that work to the applicant after he ceased employment. On recollection, the statement of Rob Verco again, that was at page 49 of the appeal book, Mr Rob Verco states at paragraph 12:

PN207

I was informed by PIW that after Daniel Bunt ceased working at the Banyo site he remained employed by PIW and was offered further work by PIW that he declined.

PN208

DEPUTY PRESIDENT SAMS: So the offers of work were as an agency employee?

PN209

MS STUCKEY-CLARKE: Of theirs.

PN210

DEPUTY PRESIDENT SAMS: Not offers of work as of an employee of the respondent?

PN211

MS STUCKEY-CLARKE: Correct.

PN212

JUSTICE BOULTON: This was, as it were - the evidence was never tested, was it?

PN213

MS STUCKEY-CLARKE: That’s correct.

PN214

JUSTICE BOULTON: Because there were these statements put in - - -

PN215

MS STUCKEY-CLARKE: Yes, there was a directions conference held by Simpson C on 15 November last year, 2013. Both parties at that conference indicated that it may be appropriate for the matter to be dealt with on the papers and both parties were directed to file the submissions a fortnight later on the 29^th. On 4 December both parties indicated that that was acceptable to have the matter dealt with on the papers. Both parties in the meantime had filed statements in preparation for the other side potentially wanting the matters and the facts of the matters to be tested but that was an opportunity that we certainly gave up.

PN216

DEPUTY PRESIDENT SAMS: So there’s no ongoing relationship between the respondent and the labour hire agency?

PN217

MS STUCKEY-CLARKE: Your Honour, I would have to seek confirmation about that.

PN218

JUSTICE BOULTON: But you’re not acting for the labour hire agency?

PN219

MS STUCKEY-CLARKE: No.

PN220

JUSTICE BOULTON: And you’ve not got anybody from the labour hire agency here so - - -

PN221

MS STUCKEY-CLARKE: No.

PN222

JUSTICE BOULTON: - - - you’re only being instructed by the company in this case.

PN223

MS STUCKEY-CLARKE: Yes, and my understanding is based on, I guess, the extent to which PIW offered the applicant further work. My understanding is based solely on discussions with representatives of the respondent in this matter. So to that extent it’s certainly limited.

PN224

JUSTICE BOULTON: Yes, thank you. Mr Kerr, anything in response?

PN225

MR KERR: No, nothing further to add to that, your Honour, to the submissions put.

PN226

JUSTICE BOULTON: Good, yes, thank you for your submissions in this matter. The bench will reserve its decision in this matter so we’ll hand down a written decision as soon as we can. We’ll adjourn until that time. Thank you.

<ADJOURNED INDEFINITELY [11.08AM]

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #K1 APPELLANT'S OUTLINE OF SUBMISSIONS PN12
EXHIBIT #S1 RESPONDENT'S OUTLINE OF SUBMISSIONS DATED 31/3/14 PN193