Secretary, Department of Employment, Education, Training & Youth Affairs v Hall, Peter [1997] FCA 795

FEDERAL COURT OF AUSTRALIA

SOCIAL SECURITY - appeal from Administrative Appeals Tribunal - Newstart Allowance - Case Management Activity Agreement - clause in agreement requiring person to accept any offer of placement - respondent accepting offer but after change of mind failing to start work - whether acceptance of offer

Employment Services Act (Cth) ss 25(1),(2), 39(2)(b)

Social Security Act (Cth) s 45

Secretary, Department of Social Security v Clear (1991) 23 ALD 22 Secretary, Department of Employment, Education, Training and Youth Affairs v Peter Hall No. TG 8 of 1997 JUDGE: HEEREY J PLACE: MELBOURNE (HEARD IN HOBART) DATE: 15 AUGUST 1997

IN THE FEDERAL COURT OF AUSTRALIA ) ) VICTORIA DISTRICT REGISTRY ) TG 8 of 1997 ) GENERAL DIVISION )

BETWEEN: SECRETARY, DEPARTMENT OF

EMPLOYMENT, EDUCATION,

TRAINING AND YOUTH AFFAIRS

Applicant

AND: PETER HALL

Respondent

JUDGE: HEEREY J PLACE: MELBOURNE (HEARD IN HOBART) DATED: 15 AUGUST 1997

MINUTES OF ORDER

THE COURT ORDERS THAT: 1. The appeal is dismissed. 2. The applicant pay the respondent's costs, including reserved costs. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA ) ) VICTORIA DISTRICT REGISTRY ) TG 8 of 1997 ) GENERAL DIVISION )

BETWEEN: SECRETARY, DEPARTMENT OF

EMPLOYMENT, EDUCATION,

TRAINING AND YOUTH AFFAIRS

Applicant

AND: PETER HALL

Respondent

JUDGE: HEEREY J PLACE: MELBOURNE (HEARD IN HOBART) DATED: 15 AUGUST 1997

REASONS FOR JUDGMENT The applicant appeals from a decision of the Administrative Appeals Tribunal (the Tribunal) which affirmed a decision of the Social Security Appeals Tribunal setting aside a decision made by the applicant's delegate to cancel the respondent's Newstart Allowance. The Social Security Appeals Tribunal had substituted a decision that the respondent did not fail to comply with his Case Management Activity Agreement (CMAA) and remained qualified for a Newstart Allowance. The issue was whether the respondent accepted an offer of a placement under the New Work Opportunities Program within the meaning of s 39(2)(b) of the Employment Services Act 1994 (Cth) (the Act). The applicant's delegate had held that the respondent did not accept an offer of a placement and thus did not take reasonable steps to comply with the terms of the CMAA, as required by s 45(5)(b) of the Act. The Legislation Persons who are registered with the Commonwealth Employment Service (CES) or in receipt of unemployment benefits may become participants in the case management system: s 25(1) and (2). The CES must refer a person who is a participant in the case management system to a case manager: s 29(4). A person referred to a case manager is to have a written agreement known as a Case Management Activity Agreement. This is an agreement between the person concerned and the case manager. Under s 39(1), the CMAA "is to be directed to securing employment for the person" and "is to require the person to undertake one or more of the following activities approved by the Employment Secretary". Paragraphs (a) to (j) of s 39(1) then list various activities such as "a job search", "a vocational training course" etc. Under s 39(2) a CMAA is taken to include a term to the effect that, at any time when the person is eligible for the Job Compact, the person is required to, amongst other things: (b) accept any offer of a placement under the New Work Opportunities Program administered by the Department. A person is eligible for a Job Compact if he or she has been in receipt of a Newstart Allowance for at least eighteen months: s 39(10). The respondent was such a person. Under s 45(5)(b) a person is not qualified for a Newstart Allowance in respect of a period unless (in addition to meeting any other requirements set out in the Social Security Act 1991 (Cth)) "the person satisfies the Employment Secretary that the person is taking reasonable steps to comply with the terms of" a CMAA in force during that period. Evidence Before the Tribunal The respondent signed a CMAA on 13 October 1995. Included in the CMAA was a clause which expressly stated the obligation prescribed by s 39(2)(b. On 10 November 1995 the respondent's case manager referred him to a placement with a company called Tasmanian Devil Jet Pty Ltd at New Norfolk. The company carried on a business of operating jet boat rides for tourists. As stated by the company, the duties of the position offered were "to assist in dressing passengers, selling souvenirs and refuelling" as well as assisting with administrative and secretarial tasks. The respondent on either 22 or 24 November (there is some uncertainty about the date) attended an interview with the company and was assessed as suitable. He was to attend a three week training program commencing on 27 November. The representative of the company said "You can have the job if you want it". The respondent said "Fine". The company representative noticed the respondent had cigarettes with him and said "There is only one thing, you are not allowed to smoke on the job". The respondent described himself as "a bit dumbfounded" over this but said "Yes, I will give it a go". The respondent later changed his mind. He did not attend the training program. The reason for this was the requirement of non-smoking. He said in evidence: I get very anxious and I thought to myself well, I am just not going to be able to perform properly on the job something like this and it would be just better off for them and me if I didn't take the job. He came to this decision on the day after the interview and advised the CES training centre on the following Monday, which was either three or five days after the interview. The Tribunal's Decision The Tribunal said: In my view, the respondent had accepted the offer of a placement under the New Work Opportunities Program, and had accepted the company's offer of paid work. He had entered into a binding oral contract with the company to work for it as an employee. He breached that contract, or repudiated it, by not proceeding to perform the contractual obligations that he had undertaken. However, s 39(2)(a) & (b) do not require an individual to perform a contract once there has been an offer and acceptance, nor to participate in the New Work Opportunities Program after an offer of replacement therein has been accepted. The Tribunal did not make a finding as to whether the respondent had taken reasonable steps to comply with the CMAA. However, a reading of the Tribunal's reasons rather suggests that, had it come to a different view as to the construction of 39(2)(b), it would have held no reasonable steps were taken. The Applicant's Argument Counsel for the applicant argued that the Tribunal adopted an unduly narrow view of the terms of the CMAA and s 39(2)(b). Counsel conceded that, if the matter were to be looked at in terms of the law of contract, there had been an acceptance of the offer of employment. However he argued that s 39(2)(b) contemplates that the person will accept the offer "in substance" and will actually commence to undertake employment. He argued that the Tribunal's approach would encourage the evasion of obligations under a CMAA by persons formally accepting employment offers, but declining to take them up. The construction adopted by the Tribunal would, he said, make s 39(2)(b) of the Act unenforceable. A construction which would avoid that result ought to be preferred. Conclusion In my view the Tribunal was correct. I think the ordinary meaning of the expression "accept any offer" in the context of s 39(2)(b) accords with the meaning which it would bear in the law of contract. Accepting an offer is one thing, performance is another. The adverse consequences which the applicant claims will flow from the Tribunal's construction could only be of assistance as an aid to construction if the language of the statute gave some foothold, however tenuous, for the construction for which the applicant contends: see Secretary, Department of Social Security v Clear (1991) 23 ALD 22 at 27-28. I do not think this is the case. But in any event the construction urged by the applicant would be equally open to abuse. Even if, as counsel contended, "accept any offer" means "accept any offer and actually start work" that requirement would be satisfied by the most brief and token attendance. There are other factors which tend to mitigate against the consequences of which counsel spoke. First, if an acceptance of an offer was not genuine, in the sense that the person at the time of acceptance in truth had no intention of proceeding with the employment, then it seems likely that that there would not be an acceptance at all. The "acceptance" would be a sham. There is no suggestion of course that this happened in the present case. The Tribunal as a matter of fact accepted that the respondent genuinely accepted the offer but then, however unreasonably, changed his mind. Secondly, the social security legislation already provides sanctions against people who are voluntarily unemployed: see Social Security Act 1991 (Cth) ss 628, 630A. The appeal will be dismissed with costs, including reserved costs. I certify that this and the preceding five (5) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Heerey