IN THE INDUSTRIAL RELATIONS ) No. WI 553 of 1994 COURT OF AUSTRALIA ) WESTERN AUSTRALIA DISTRICT REGISTRY ) BETWEEN: Steven McGee Applicant AND: Peter Barron trading as Road Trains West Pty Ltd Respondent BEFORE: Boon JR PLACE: Perth DATE: 12 April 1995 REASONS FOR JUDGMENT The applicant has applied under S170EA of the Industrial Relations Act 1988 for orders for reinstatement and compensation in relation to an alleged unlawful termination of his employment with the respondent. As a preliminary point the respondent argues that the applicant is excluded from the operation of Subdivisions B, C, D and E of Division 3 of Part VIA of the Act in that he was a casual employee engaged for a short period within the meaning of Regulation 30B of the Industrial Relations Regulations. If this court finds that the applicant was a casual employee engaged for a short period then the unlawful termination provisions of the Act do not apply to the applicant and that would be the end of the matter. Under Section 170CC of the Act, the regulations may exclude certain specified employees from the operation of specified provisions of Division 3 of Part VIA of the Act. Regulation 30B states in part: "30B(1)[Excluded employees] Subject to subregulation (2), for the purposes of Section 170CC of the Act, the following employees are excluded from the operation of Subdivisions B, C, D and E of Division 3 of Part VIA of the Act: .... (d) a casual employee engaged for a short period within the meaning of subregulation (3)." "30B(3)[Casual employees engaged for a short period] For the purposes of paragraph (1) (d) a casual employee is taken to be engaged for a short period unless: (a) the employee is engaged by a particular employer on a regular and systematic basis for a sequence of periods of employment during a period of at least 6 months; and (b) the employee has, or but for a decision by the employer to terminate the employee's employment, would have had, a reasonable expectation of continuing employment by the employer." The Facts and Evidence Regarding Casual Employment The applicant was born on 26 January 1958 and has worked as a driver for 17 years or more. Immediately before his employment with the respondent he was employed as a driver on an ad hoc casual basis with several different companies for about six months. Before that he was employed as a driver by Harbour Haulage. The respondent, Peter Barron, owns and operates a road transport business known as Road Trains West Pty Ltd. His equipment includes a prime mover, two trailers and a dolly (which hooks the second trailer onto the first trailer). The staff of the respondent consists of Mr Barron himself and one other driver. The business of the respondent involves making trips from Sydney to Perth. The respondent's prime client is a business known as Air Road. The respondent previously owned and operated a business known as "B-Double Express". That company had a contract with Air Road under which the respondent had regular work from Air Road. The truck which formed the main equipment of B-Double Express was involved in an accident in 1994 and was written off. Mr Barron acquired a new prime mover and formed Road Trains West. His uncontested evidence is that Air Road would not give Road Trains West a contract and their haulage agreements now operate on a week by week basis. Mr Barron's evidence was that all of the equipment of Road Trains West was on lease and insured. The equipment is valued at approximately $430,000 and its lease and insurance costs are a heavy burden to the respondent company. In an affidavit filed and sworn by Mr McGee, the applicant, he states that in the last week of July 1994, he spoke by telephone with Mr Barron. At this time Mr McGee was in Melbourne and Mr Barron was in Sydney. During the course of that conversation, Mr Barron informed Mr McGee that he had recently acquired a new truck. He states that "in that conversation and in subsequent conversations over the next two weeks, Peter led me to believe that I was to be employed by Road Trains West as the permanent driver of the truck." Paragraph 6 of the applicant's affidavit states that: "6. The terms of my verbal contract of employment with Road Trains West, as agreed between myself and Peter, were that: (a) I would drive the Road Trains West truck to Sydney and return on a weekly basis (a "trip"); (b) I would be paid $800.00 per trip, plus $150.00 per trip by way of living away from home allowance ("LAH" allowance); (c) Over the Christmas and New Year period when there is traditionally a quiet period in the trucking industry, I would be entitled to take between one to two weeks of paid annual leave." The road train was to be based in Perth. According to Mr Barron's evidence, the road train required two drivers. Mr Barron was usually one of the drivers and he employed another driver to go on each trip with him. The road train would arrive in Sydney early on a Friday morning. They would be contacted by Air Road sometime on Friday afternoon about whether there was freight for them to carry. If they were to make a trip, they would load up the trailers, leave Sydney on Friday night and get back to Perth early on Monday morning. They would unload in Perth and drive back to Sydney. The two drivers would take turns driving the prime mover. They would drive for alternating periods of about 5 hours each. In late August, Mr McGee was picked up at Essendon Airport by Mr Barron and they drove to Sydney. The two men stayed in Sydney for about a week. Mr McGee's evidence was that during this time some final preparation work was done on the truck. However, during cross-examination it appeared that during that week the men did not make a trip to Perth because there was no freight and that is why they stayed in Sydney. At first Mr McGee stated that he was paid $100.00 for that week and that this payment was a bonus towards the trip. During further cross-examination it appeared that this payment was a gratuity paid by Mr Barron to Mr McGee to cover some of his expenses. I am satisfied that it did not represent a payment of wages. The applicant first drove the truck from Sydney to Perth on 1 September 1994, which counted as a half-trip. He received wages of $400.00 gross plus $75.00 living away from home allowance and the $100.00 payment referred to above. Thereafter for the next 10 weeks he did a trip every week for which he was paid $800.00 per trip gross plus living away from home allowance of $150.00. On 14 November 1994 the respondent terminated the applicant's employment without notice. Throughout his affidavit evidence and verbal evidence, the applicant maintained that he was employed as a permanent driver. Mr Barron's evidence was that in the road transport industry it is only the big companies which can afford to have permanent employees. Small companies like the respondent's company have casual employees because they cannot afford to pay employees if the company is not paid for carrying freight. Mr Barron's evidence was that it was made clear at all times that his drivers only get paid by the trip. If they did a trip, they would get paid. If they did not do a trip, they would not get paid. Mr Barron said that the arrangement was that Mr McGee would be a casual employee. He said that he never told Mr McGee that he would get paid annual leave. Mr Barron's evidence was that during the first week in Sydney he learnt that there was no freight and that there would be no trip, and accordingly Mr McGee was not paid for that week. As to the question of annual leave, although Mr McGee stated in his affidavit that it was a term of the verbal contract that he would be entitled to take between one and two weeks paid annual leave, during cross-examination it became apparent that although during the conversation Mr McGee had with Mr Barron it was said that at Christmas time there is a lull, Mr Barron did not actually say that he would get paid leave. Mr McGee's verbal evidence was that "it was not indicated to me that I would not be paid". During cross-examination Mr McGee also admitted that if there was no freight, then it was possible that there would be no work for a week. He said, however, that this was a possibility, but not a probability. He said that if Air Road did not have a load to go (which was not a likelihood) then alternative freight may be found. The Meaning of "Casual Employee" There is no definition in the Industrial Relations Act or the Industrial Relations Regulations of the meaning of "casual employee". The meaning of the word "casual" in relation to employment has been considered in a number of cases relating to various statutes and awards. The only consistent approach which can be gleaned from those cases seems to be that each case must be decided on its own facts. Thus in the case of Australasian Meat Industry Employees Union v Sunland Enterprises Pty Ltd (trading as Sunland Wholesale Meats) (1988) 24 1R 467 Gray J said at p473 "the term "casual employee" does not have a recognised legal meaning. This is apparent from cases such as Doyle v Sydney Steel Co. Ltd (1936) 56 CLR 545 and Linehan v Northwest Exports Pty Ltd (1981) 47 FLR 49, especially at 57-61. In these circumstances, the issue of the terms on which the actual casual employees were engaged becomes one of fact." In Ryde-Eastwood Leagues Club Ltd v Taylor No. IRC 1475 of 1994 10 October 1994 the Industrial Relations Commission of New South Wales held that the expression "casual employment" is a colloquial and ill-defined term, and whether casual employees attracted the jurisdiction of the commission is therefore not a question of employment status, but a question relating to the nature of the casual employment in each situation. There is authority that workers may be casual employees although engaged regularly under successive contracts of employment. This is common in areas of employment where there are periods during which no work is available, e.g. Cue's case (1909) IDB 352; Doyle v Sydney Steel Co. Ltd; Hill v Begg (1908) 2KB 802; and see O'Kelly v Trusthouse Forte plc (1983) ICR 728. One of the tests of whether employment is casual as distinct from permanent is whether there is an entitlement on the part of the employee to demand work of the employer and a corresponding obligation on the part of the employer to provide work to the employee. The definition of "casual employees engaged for a short period" in Subregulation 30B(3) clearly envisages a situation in which a casual employee is engaged by an employer on regular successive contracts. Paragraph (a) of Subregulation 30B(3) refers to an employee who "is engaged by a particular employer on a regular and systematic basis for a sequence of periods of employment during a period of at least 6 months." In the case before me the applicant contends that he was a permanent employee and the respondent contends that the applicant was a casual employee who would only be paid per trip actually carried out. It is always difficult to decide these matters where there is no written contract of employment but in this case I favour the evidence of Mr Barron over that of Mr McGee. In the first place, the fact that Mr McGee was not paid during the first week in Sydney (when there was no freight to carry) supports Mr Barron's version of the agreement. Secondly, there was nothing in Mr Barron's demeanour or evidence which caused me to question the truth of what he was saying. There were, however, some inconsistencies between Mr McGee's affidavit evidence and his verbal evidence which have already been referred to above. For example, Mr McGee's affidavit evidence was that there was a verbal agreement that he was to receive one or two weeks paid annual leave but during cross-examination he admitted that he was simply not told that he would not be paid during time off over the Christmas period. Thirdly, it is not uncommon in the road transport industry for drivers to be employed on a casual basis. Before his employment by Road Trains West, Mr McGee had for a period of six months been employed on a casual basis with several different companies. In the present case I am satisfied that although Mr McGee's employment with the respondent was regular, there was no obligation on the part of the respondent to provide work. Having said that, I also consider that Mr McGee had, but for Mr Barron's decision to terminate his employment, a reasonable expectation of continuing employment in the same way: hence his perception that he was to be the "permanent" driver for Mr Barron. Thus, although I consider that Mr McGee comes within sub-paragraph (b) of Subregulation 30B(3), he was engaged by the respondent for a period of considerably less than 6 months and he does not come within sub-paragraph (a). Mr McGee was therefore a casual employee engaged for a short period within the meaning of Subregulations 30B(1)(d) and 30B(3) and he was excluded from the operation of the Act. Although that effectively disposes of the matter, I consider that if Mr McGee had not been excluded by Regulation 30B the termination of his employment would in all likelihood have been held to contravene the provisions of the Industrial Relations Act. He was given no warnings about his alleged unsatisfactory performance and I do not consider that I could have found on the balance of probabilities that Mr McGee intended to defraud Mr Barron. He was given no opportunity by Mr Barron to explain his actions. The order of the court is that the application be dismissed. I certify that this and the preceding eight (8) pages are a true copy of the Reasons for Judgment of Judicial Registrar Boon. Associate: Date: The Applicant appeared in person. Counsel for the Respondent: Mr S. Kemp Solicitors for the Respondent: Parker and Parker Date of Hearing: 7 March 1995 Date of Judgment: 12 April 1995 IN THE INDUSTRIAL RELATIONS ) No. WI 553 of 1994 COURT OF AUSTRALIA ) WESTERN AUSTRALIA DISTRICT REGISTRY ) BETWEEN: Steven McGee Applicant AND: Peter Barron trading as Road Trains West Pty Ltd Respondent BEFORE: Boon JR PLACE: Perth DATE: 12 April 1995 MINUTES OF ORDER THE COURT ORDERS THAT: 1. The application be dismissed. Note: Settlement and entry of orders is dealt with in Order 36 of the Industrial Relations Court Rules. CATCH WORDS INDUSTRIAL LAW - Termination of employment - claim of unlawful termination - whether casual employee - meaning of "casual employee" - application dismissed. INDUSTRIAL RELATIONS ACT 1988, Ss 170C, 170EA INDUSTRIAL RELATIONS REGULATIONS, Regs 30B(1), 30B(3) Australasian Meat Industry Employees Union v Sunland Enterprises Pty Ltd (1988) 24 1R 467 Ryde-Eastwood Leagues Club Ltd v Taylor, No 1RC1475 of 1994, 10 October 1994 Doyle v Sydney Steel Co Ltd (1936) 56 CLR 545 Cue's case (1909) 1DB 352 Hill v Begg (1908) 2KB 802 O'Kelly v Trusthouse Forte plc (1983) 1CR 728 STEVEN MCGEE v PETER BARRON trading as ROAD TRAINS WEST PTY LTD No. W1 553 of 1994 BEFORE: Boon JR PLACE: Perth DATE: 12 April 1995