Lisa Buckley v Wavelength International Pty Ltd [1995] IRCA 314

IN THE INDUSTRIAL RELATIONS COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY VI 1337 of 1995 B E T W E E N: Lisa BUCKLEY Applicant A N D WAVELENGTH INTERNATIONAL PTY LTD Respondent REASONS FOR JUDGMENT 10 July 1995 PARKINSON JR The applicant in this matter was employed by the respondent at its surf shop at Torquay in Victoria. The store trades under the name of Piping Hot. The applicant was employed as a Retail Worker Grade 1 and worked regular hours according to a roster provided by the respondent. The applicant was initially engaged on a permanent full time basis in 1990 by the then owner of the business operation and remained employed in that capacity for six months until, owing to the uncertain trading state of the business, she took a job with a nearby trader. In 1991 she was invited by the manager of the Wavelength store to return to the employ of the business. When she returned her evidence was that she returned as assistant manager and, whilst employed as a casual employee, returned on the same terms and conditions as she had previously enjoyed. In 1993 the applicant applied for and was granted what she described as extended leave without pay, and travelled overseas. In early 1994 she returned to work at the premises and was engaged at that time on a casual contract or hire. The terms of this contract are in my view clearly "casual" in accordance with the terms of the Award governing the employment. The evidence was also that both parties were aware of and intended that the applicant be employed on a casual basis. The applicant was paid an hourly rate of pay together with a loading of 25 per cent, and was also paid penalty rates for weekend and night work according to the provisions of a former Award of the Employee Relations Commission of Victoria. That Award was the General Shops Award (No. 1 of 1994). Its terms and the terms of the Clothing and Footwear Shops Award (No. 1 of 1994) are in all material respects the same. I am satisfied that the terms of the contract of employment between the parties were as provided in the relevant Victorian Award. The applicant's evidence was that she was employed on a regular and ongoing basis between the date she originally commenced employment at the business and the date on which she was told of the termination of her employment. The evidence was that she was engaged to work 26 hours per week and that invariably this was the number of hours worked, although there were some increases to those hours in some weeks during the period. Her evidence was that her hours of work always increased to full time hours or more during the peak trading periods of the respondent, being Easter and school holidays, particularly Christmas holidays. Exhibit W1 is a document which provides an analysis of the hours worked by the applicant. The applicant was rostered to work on a formal roster, notice of which was given to employees some days in advance of the commencement of the roster. This prospective and weekly rostering arrangement was an ongoing feature of the relationship between the applicant and the respondent. Exhibit M1 is the roster with which the applicant was required to comply during the week ending 29 January 1995. The evidence was that, save for the termination of her employment on 23 January 1995, the applicant would have attended upon that roster and was expected by the respondent to attend upon that roster. Regulation 30B(3) - Casual employees engaged for a short period Despite the applicant having a long history of employment at the business known as Piping Hot, the respondent contends that the applicant is precluded from bringing proceedings pursuant to S170EA of the Act because of the operation of regulation 30B(3)(a) of the Act. The respondent relies upon there having been a transfer of the ownership of the business on or about 26 July 1994, at which time the applicant ceased to be employed by Wavelength Manufacturing Proprietary Limited and Wavelength Australia Proprietary Ltd, and was employed by the respondent at that time named Depit Proprietary Ltd. In August 1994 the respondent changed its name to Wavelength International Pty Ltd. It submits that because there was a termination of the employment on 23 January 1995, the applicant was not engaged by the particular employer for a period of six months and falls within the class of casual employees precluded from a remedy by regulation 30B(3)(a). The respondent submits that the prior service with the previous owner of the business and the applicant's previous employer is not relevant to a consideration of the operation of regulation 30B in respect of the present employment. It also submits that the fact of continuity of employment is also irrelevant. In support of this proposition the respondent points to the use of the word "particular" in the regulation. Regulation 30B(1)provides in so far as is relevant: "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)." Regulation 30B(3) provides as follows: "For the purposes of paragraph (1)(d), a casual employee is taken to 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 the decision by the employer to terminate the employee's employment, would have had, a reasonable expectation of continuing employment by the employer." Counsel for the respondent conceded that the matters in sub-regulation (b) applied. This was a proper concession in view of the evidence of the lengthy history of employment at the business premises in Torquay. It is also an appropriate concession in the context of the decision made by the respondent to alter its method of employment from casual to full time employment. It would in my view have been reasonable for the applicant to expect that her employment would have continued. Counsel for the respondent submitted that the ordinary meaning of the word "particular" in regulation 30B had the result that the only period of time relevant for the purposes of 30B(3)(a) is that period between 26 July 1994 and 23 January 1995. This, it was said, was not a six month period and therefore the applicant was not entitled to bring the proceeding. I agree that the use of the word "particular" in the regulation appears to direct attention to the actual employer and seems to not provide for any consideration of previous service in the context of a transmission of the business. However I should state that I am not convinced that the term "particular employer" is intended to preclude from the Act persons who, like the applicant in this case, have been employed in a workplace on a longstanding casual arrangement but who, as a result of a change in ownership of the business, or a transmission of the business, become employees of a "new" employer. Industrial regulation, including federal awards and S149(1)(d) and S149(2)(c) of the Industrial Relations Act, recognises the appropriateness of continuing obligations upon parties who are the successors, assignees or transmittees of a business. I have difficulty in accepting that the parliament intended the opposite to apply in the operation of regulation 30B. However it is not necessary to decide this aspect in this matter as I have determined for other reasons that the applicant is not excluded by regulation 30B. I turn to consider these reasons. Regulation 30B(3)(a) - "engaged" Regulation 30B(3) is not directed to considerations of the date of the employment and the date of the termination of the employment. This is because of the use of the term "engaged", not "employed", in the regulation. The circumstances of the hiring of the applicant have been set out above. In particular I have discussed earlier the rostering arrangements which existed between the parties. Having regard to the nature of the obligations between the parties arising out of the hiring, it is clear that the contractual obligations existed at least to the end of the roster for which the applicant was engaged during the week commencing 23 January 1995. I say 'at least' because in my view, despite being employed as a "casual" employee for the purposes of the Award obligations, I am satisfied that the contractual arrangements between the parties were in fact for an ongoing or continuing contract of employment. The contract between the parties was a casual contract arising out of a series of engagements from week to week, roster to roster, over a lengthy period of time. The facts of this matter are such that the applicant falls within that class of casual employees who are employed on a regular hiring. They are what is often described as "regular casuals" or, in seemingly contradictory terms, "permanent casuals". That class of casual employees has been described in a decision of the Full Commission of the Industrial Relations Commission of NSW in Ryde-Eastwood Leagues Club v Taylor (1994) 56 IR 385. In that case consideration was given to the nature of the engagement. The Full Bench concluded that the Award in that case did not regulate the terms on which the casual employee may be engaged, but rather the payments to be made to them. I am of the same view in relation to the Award regulation applicable in the present case. Indeed the Award clause regulating payment of casual employees, Clause 18, contemplates the possibility of regular or ongoing engagement in that it provides for payment on a weekly or fortnightly basis and not from day to day. This supports the contention that the applicant had an entitlement to ongoing employment on the roster of the week ending 29 January 1995. Further, in Ryde-Eastwood Leagues Club at pages 401-2, in concluding a discussion of the nature of the distinction between various classes of casual employment contracts, the Full Bench said: "The first class refers to those employees who are truly casual in the sense that there is no continuing relationship between the employer and the employee. The second class is where there is a continuing relationship which amounts to an ongoing or continuing contract of employment; it is this class which for the reasons set out earlier by us, is of such a nature as to attract the Commission's jurisdiction under Pt 8 of Ch 3 of the Act." I recognise that for the purposes of the definition of "engaged for a short period", this distinction between classes of casual employees is only in part relevant. I am required to treat the casual employment as being for a short period if it does not meet the criteria set out in regulation 30B(3)(a)and (b). It is necessary to ascertain the nature of, and terms, of the engagement in the present case. The engagement according to the roster for the week ending 29 January 1995 was to cease on 29 January 1995. According to the contractual obligations which existed between the parties, the applicant was engaged by the respondent for a period of at least six months. That period of engagement was to 29 January 1995. The applicant had been engaged by the respondent for employment to that date. I do not think that the terms of the contract of employment are irrelevant to the determination of the question pursuant to regulation 30B, and in particular to the application of the term "engaged...for a sequence of periods of employment during a period of at least six months." In the consideration of regulation 30B(1)(d) and (3), the issue is not the date of the termination of the employment in the context discussed in Siagian v Sanel Pty Ltd (1994) 122 ALR 333 and APESMA v Skilled Engineering (1994) 122 ALR 471, but rather the terms of the engagement which existed, and the length of that engagement. In this case the facts establish that the applicant was "engaged" by the respondent to at least 29 January 1995. That the engagement was terminated by the respondent on 23 January 1995 does not change this fact. Whilst the termination of the employment occurred on 23 January 1995, nevertheless the contractual entitlement in respect of the engagement continued to 29 January 1995. Having regard to this, I am not satisfied that the applicant was "engaged" other than for a sequence of periods of employment during a period of at least six months. It is the engagement by the employer, not the timing of the termination, to which the regulation directs attention. In this case the applicant was engaged by the respondent by way of the roster for the week ending 29 January 1995 (Exhibit M1). This engagement was until cessation of business on 29 January 1995. Whilst the applicant may not have actually worked until that day, she was in my view "engaged" to work for that period of time in the ordinary meaning of that word. I am satisfied that the applicant was a casual employee who is not to be taken as having been engaged for a short period, because she was engaged by the respondent on a regular and systematic basis for a sequence of periods of employment during a period of six months. As earlier stated, no issue was taken with the expectation of continuing employment. The respondent's counsel made submissions in relation to the application of Regulation 30B(1)(a). It follows from my conclusions on the nature of the contract of employment herein, that I reject the submission that the applicant as at December, 1994 was engaged upon a contract for a specified term pursuant to that regulation. Having satisfied myself that the court has jurisdiction to hear and determine the application made pursuant to S170EA, I turn now to consider the substantive merits of the application. S170DE(1) - Valid Reason for the Termination of the Employment The respondent's evidence was that the reason for the termination of the employment was that it decided to change its method of employment from casual employment to full time permanent employment. The applicant was advised of this by the current store manager on the day before her employment was terminated by the respondent. She was told that her employment was to cease, and that the position which was for all intents and purposes the position which the applicant had been occupying for a number of years was being advertised. In the circumstances, I am not satisfied that the respondent had a valid reason for the termination of the applicant's employment. This is because I am not satisfied that there was an operational requirement to terminate the employment of the applicant in circumstances where her position was to be filled by a new employee, and in fact was advertised. Whilst I accept the evidence of Mr Sadakay that the respondent had decided to change its method of employment from casual to permanent staff, I am not satisfied that the consequence of this decision was necessarily that the applicant's employment required termination. No serious steps were taken to ascertain the availability or the suitability or otherwise of the applicant for the full time position to be advertised. I am satisfied that whether the applicant's position was described as an assistant manager or retail worker or otherwise, she was performing the duties and functions of the position which was advertised and had been so doing for a substantial period of time. S170DE(2) - Harsh, Unjust and Unreasonable The applicant's employment was terminated on 23 January, prior to the end of the roster on 29 January 1995 as a result of an instruction from Mr Sadakay, the managing director, Ms Wright. The evidence was that this step was taken at that time because of a conversation between Ms Wright and the applicant on the previous evening in which, according to Ms Wright, the applicant was abusive towards her. The applicant was given no opportunity to reply to any allegation against her which may have been made by the manager. Nor was she even heard in relation to any of the grievances she may have held as a result of her treatment by the respondent and its manager. A decision was made to terminate her employment on that day, without notice or payment in lieu of notice, and notwithstanding that she had been engaged at least until the end of the week. There was no discussion with the applicant and no consultation with her as to the future. Despite the fact that the respondent's employees were aware of the applicant's work history, no consideration was accorded her and she was harshly and arbitrarily dealt with. The respondent apparently felt it was entitled to terminate the employment with no warning and no consideration for the feelings of its employees. Whilst this approach would appear to be harsh when applied to persons who were merely employed for the short term summer period, its is especially so when such an attitude is adopted in relation to an employee who has worked at the business for some four years. I accept the evidence of the applicant and Ms Murrie as to the manner in which she and others were initially informed of the termination of their employment on 22 January 1995. I am satisfied on the evidence as to the circumstances of the termination of the employment that the termination was harsh, unjust and unreasonable. This is because there was an adoption by the respondent of a changed system of hiring which removed the applicant's ongoing employment, and there was no discussion with her in this regard nor any forewarning of this fact. Further there was no discussion with the applicant as to alternatives to the termination of her employment, nor any consideration of options for providing the applicant with ongoing employment. The placement of an advertisement for the position, without any prior discussion with the applicant, and in the absence of there being any criticism or express concern with her work performance, further added to the unreasonableness of the conduct of the respondent and the harshness of the termination of the employment. As the respondent's counsel conceded, the applicant had reasonably an expectation of ongoing employment with the respondent. For the above reasons I am satisfied that the termination of the applicant's employment was harsh, unjust and unreasonable. I am satisfied further that in so far as the termination was effected earlier than originally intended, due to the allegations that the applicant abused the store manager, this aspect of the termination required that the applicant be heard pursuant to S170DC and this opportunity was not accorded her by the respondent. Having decided that the termination of the employment was without valid reason and was harsh, unjust and unreasonable, I turn now to consider the question of remedy. S170EE - Remedy In the circumstances I am satisfied that reinstatement of the applicant to the position would be impracticable. This is because of the obvious hostility between herself and the manager of the store. This hostility is mutual and open, and does neither party any credit. The applicant herself said in evidence that it would be difficult to return to work with the respondent's manager. The applicant is apparently disdainful of the manager and clearly bitter towards her. The respondent's manager has described the applicant's conduct towards her and clearly holds a personal dislike of her. These people would of necessity work together if the applicant were reinstated. This case is one of such extreme that I do not believe that there would be any possibility of restoration of a harmonious working relationship. I am satisfied that reinstatement of the applicant to the position she occupied prior to the termination would be impracticable. Whilst the respondent has operations at Mulgrave in Victoria, the applicant is resident at Torquay and to reinstate to an alternative position would also be impracticable. In view of these matters I therefore turn to consider the appropriateness of compensation and the amount of such compensation. The respondent submits that any award of compensation ought not exceed the equivalent of two months pay. This it says is an appropriate sum having regard to the likely length of employment but for the termination. The applicant seeks the maximum amount of compensation available pursuant to S170EE(3). In determining the amount of compensation, I have regard to the nature of the applicant's employment as a casual employee, together with the fact that the position she previously occupied was to continue, but to be filled by a permanent employee. The evidence is that the applicant has been unable to obtain alternative employment, and as a result has been contemplating establishing her own business. I am satisfied that but for the events which occurred on 22 and 23 January 1995 the applicant was likely to have continued in the employment for a reasonable period of time, although this would clearly have been affected if she had not been selected for the full time position or had not applied for it. I do not think that, given a serious opportunity, the applicant would not have applied for the position. I have decided that the appropriate wage to have regard to in coming to a conclusion as to the amount of compensation, is that representing the usual earnings of the applicant during the employment. This sum is the amount she earned for working 27 hours per week. I am satisfied having regard to Exhibit W1 and Exhibit M5 that the applicant's earnings were in the sum of $ 862.15 per fortnight. I am of the view that the applicant is entitled to compensation in the sum of $6897.00, in view of the length of time she was employed at the business, together with the circumstances of her termination of employment during the course of the committed roster and a reasonably likely length of time that the employment would have continued. The orders of the court will be: 1. That the respondent pay to the applicant the sum of $6897.00 in compensation pursuant to S170EE(2). 2. That the time for payment is twenty one days from the date of this order. I certify that this and the preceding fifteen (15) pages are a true copy of the reasons for judgment of Judicial Registrar Parkinson. Associate: Dated: 10 July 1995 Solicitors for the applicant: Arnold Thomas & Becker Counsel appearing for the applicant: Mr L W Maher Solicitors for the respondent: Dunhill Madden Butler Counsel appearing for the respondent: Mr M McDonald Dates of hearing: 13 and 14 June 1995 Date of judgment: 10 July 1995