Industrial Relations Commission of New South Wales in Court Session CITATION : Westbus Pty Ltd v Bartush [2000] NSWIRComm 26 APPELLANT Westbus Pty Ltd PARTIES : RESPONDENT David Bartush FILE NUMBER: IRC4248 of 1998 CORAM: Wright J President; Hungerford J; Marks J Long Service Leave - Appeal from Local Court - Worker terminated employment with more than 5 but less than 10 years' service - Claimed loss of income and inability to collect child after school following changes in employment conditions - Whether "domestic or other pressing necessity" - Test to apply - Appeal upheld CATCHWORDS : Appeal - Appeal from Local Court - Whether leave to appeal required - Whether matter justified grant of leave - Leave to appeal granted - Appeal upheld LEGISLATION CITED : Industrial Relations Act 1996 s 188 and s 197(1) Long Service Leave Act 1955 s 4(2)(a)(iii) and s 14(c) British Motor Corporation (Aust) Pty Ltd v Chance [1965] AR (NSW) 364 CASES CITED : Computer Sciences of Australia Pty Ltd v Leslie [1983] AR (NSW) 828 Drake Personnel Ltd t/as Drake Industrial v WorkCover Authority of New South Wales (Inspector Ch'Ng) (1999) 90 IR 432 Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch'Ng) (1999) 90 IR 464 HEARING DATES: 03/04/1999; 08/18/1999; 11/10/1999 DATE OF JUDGMENT: 03/27/2000 APPELLANT Mr R S Warren of Counsel SOLICITORS Anderson Legal LEGAL REPRESENTATIVES: RESPONDENT Mr E Young (Solicitor) SOLICITORS Turner Freeman JUDGMENT: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION FULL BENCH CORAM: WRIGHT J, President HUNGERFORD J MARKS J Monday, 27 March 2000 Matter No IRC 4248 of 1998 WESTBUS PTY LTD v DAVID BARTUSH Application for leave to appeal and appeal against a decision of a Local Court constituted by an industrial magistrate given on 14 July 1998 in Matter No CIM598 of 1998 JUDGMENT OF THE COURT 1 This is an appeal from the decision of a Local Court constituted by an industrial magistrate given on 14 July 1998 in connection with a claim by David Andrew Bartush (the respondent to this appeal) against his former employer Westbus Pty Limited (the appellant in this appeal). The proceedings arose out of a claim brought by the respondent pursuant to s.4(2)(a)(iii) of the Long Service Leave Act 1955 claiming the payment of approximately $4,500 as proportionate long service leave, together with interest and costs. 2 It was common ground that, as at the date of termination of the employment at the instance of the employee, the respondent had been employed by the appellant for more than 5 years' service as an adult but less than 10 years' service. Accordingly, it was necessary for him to demonstrate that he terminated his service with the appellant on account of "domestic or other pressing necessity" in order to qualify for the payment claimed under the statutory provision. It was common ground also that he need only establish this pursuant to the civil standard on the balance of the probabilities. We agree with the joint position of the parties. 3 The industrial magistrate found in the respondent's favour and the appellant has challenged that finding by its appeal to this Court pursuant to the combined operation of s 14(c) of the Long Service Leave Act and s 197(1) of the Industrial Relations Act 1996. LEAVE TO APPEAL 4 During the course of the proceedings, the issue was raised whether leave to appeal was necessary and, if so, the basis upon which such leave should be granted, having in mind the requirements of s 188 of the Industrial Relations Act. 5 By arrangement between the parties, the question of leave to appeal was deferred pending the outcome of other proceedings before a Full Bench of the Court in which that same issue arose for determination. On 12 August 1999 the Full Bench gave judgment in Drake Personnel Ltd t/as Drake Industrial v WorkCover Authority of New South Wales (Inspector Ch'Ng) (1999) 90 IR 432 in terms that leave was required to obtain a review by a Full Bench of the Court of the decision of a Local Court: see the discussion in Drake Industrial at pp 444-449. Also on 12 August 1999 a Full Bench of the Court in another case adopted the conclusions and reasons in Drake Industrial: see Lawrenson Diecasting Pty Ltd v WorkCover Authority of New South Wales (Inspector Ch'Ng) (1999) 90 IR 464 at 465. And so too do we. 6 Both parties accepted the requirement for leave and the appellant filed, by consent, an amended application for leave to appeal and to appeal; we granted leave to the appellant to move accordingly. 7 It is then necessary to consider the application for leave to appeal. We have concluded that in finding in favour of the respondent in the proceedings below the learned industrial magistrate erred. The error was of such kind, involving misapplication of legal principle and lack of evidence, as to justify the grant of leave to appeal and we will do so. 8 We turn now to the substantive issues argued on appeal. "DOMESTIC OR OTHER PRESSING NECESSITY" 9 It was accepted by both Mr Warren of counsel, who appeared for the appellant, and Mr Young, solicitor for the respondent, that the proper approach to a consideration of the question of whether domestic or other pressing necessity had been established as the real reason for the termination of employment by the employee was as set out in the decision of the former Industrial Commission in Court Session (Watson, Bauer and Glynn JJ) in Computer Sciences of Australia Pty Ltd v Leslie [1983] AR (NSW) 828. 10 The Full Bench in that case said (at p 831): Applying that approach, the present case should be resolved, in our view, by asking the following questions. (1) Was the reason claimed for termination one which fell within the section? (2) Was such reason genuinely held by the worker and not simply colourable or a rationalisation? (3) Although the reason claimed may not be the sole ground which actuated the worker in his decision to terminate, was it the real or motivating reason? (4) Was the reason such that a reasonable person in the circumstances in which the worker found himself placed might have felt compelled to terminate his employment? THE FACTUAL BACKGROUND 11 The respondent commenced employment with the appellant as a motor mechanic on 16 August 1989 at the appellant's Penrith depot. At all relevant times he resided at Springwood in the lower Blue Mountains area. About six months later he was asked to transfer to the Edensor Park depot of the appellant where he became a foreman and stayed there for three to four years until it closed. He was then transferred back to Penrith as a relieving foreman. Edensor Park is located adjacent to Bonnyrigg. In about June 1997 the respondent was again transferred, this time to the Bonnyrigg depot, but as a leading hand rather than foreman or relieving foreman. 12 Upon transfer to Bonnyrigg the number of hours which he worked each week were reduced by three, all of which had previously been paid at an overtime rate of double time. This resulted in a loss of gross earnings to him of about $97 per week. Upon transfer to Bonnyrigg his hours of work changed - he commenced work one hour later each day but on Mondays was required to finish at 4.30pm rather than 2.30pm. 13 On transferring to Bonnyrigg, the respondent said that travelling time between that depot and his home increased by 45 minutes each way. This resulted in a total travel time each way from his home to the Bonnyrigg depot of about 65 minutes. 14 The respondent's case was based on two factual circumstances which were claimed to constitute domestic or pressing necessity: first, loss of income and its impact; and, second, his inability to collect his children from school. LOSS OF INCOME 15 As previously indicated, the evidence was to the effect that the respondent was losing $97 per week. The respondent gave the following evidence before the industrial magistrate, namely: "I had no choice but to leave because I was just losing money all the time. ... I tried to make ends meet but you can't do it when you lose that sort of money. ... I was falling behind in all my bills and things like that. I got that far behind that I took annual leave, and I'm not supposed to do this, I know, but I went and worked another job just to make extra money up." 16 On leaving employment with the appellant the respondent obtained a position with another employer which provided more generous remuneration and which was closer to home. 17 Also, there was evidence to the effect that the respondent's wife was employed and worked from 9.30am to 4.30pm on Monday and Tuesday and from 9.30am to 2.30pm on Wednesday and Thursday. 18 At the hearing below, the appellant sought the production of documentation from the respondent directed to his financial circumstances, including bank statements. Whilst there is no record in the proceedings when the respondent was called upon by the appellant to produce his bank statements, it is clear from the transcript of the proceedings that the respondent refused to produce such documents in answer to the subpoena. When asked in cross examination why he had not done so, he replied: "Because I don't think it's any of your business." It then transpired that certain documents had been produced but they insufficiently complied with the requirements of the subpoena as it required the production of all bank statements, including those which reflected mortgage commitments; the documents produced made no reference to mortgage payments or credit union payments and did not cover the relevant periods. In his oral evidence, the respondent said there was a mortgage of about $150,000 on the family home and mortgage payments were about $225 to $230 per week. 19 What is clear is that the respondent did not adduce in his case any evidence concerning his overall financial circumstances or those of his family, including any contribution made by his wife. There remained only the bald assertion that the reduction of $97 per week left him struggling "to make ends meet." This position was exacerbated, he said, by the need to pay someone to collect his children from school because the extra time taken by him to drive home did not permit him to do so, coupled with the fact that he ceased work at a later time in any event. He said he was responsible for the collection of his children from school. CHILD MINDING 20 The respondent said that when he was at the Penrith depot he had time to collect his children after school on Monday, Tuesday and Wednesday and then to drive them home. When he was transferred to Bonnyrigg he could not do this so he arranged for someone else to pick them up. When he relieved at other depots he arranged for his wife to change her hours of work so that she could attend to the children but subsequently his wife's work commitments did not permit her to do this. Accordingly, he made an arrangement with a family friend, a Mrs Doust, to collect his children from school at 3pm on Monday, Tuesday and Wednesday each week and he paid her $45 per week for that. 21 Under cross-examination, the respondent said that before transferring to Bonnyrigg the working of overtime did not affect his ability to collect his children after school because most overtime was worked on Thursday, Friday and Saturday. His wife would cover for overtime he was forced to work on other days in accordance with her flexible work arrangements. The respondent was also asked under cross-examination what occurred when he worked overtime with his current employer and responded that there was an arrangement in place between his wife and Mrs Doust. Mrs Doust was no longer paid to collect the children, and she and his wife rotated to perform that task because two of the children, presumably one each of the respondent and of Mrs Doust, "do stuff together". THE CHALLENGED DECISION 22 In the decision, the industrial magistrate referred firstly to the test laid down in Computer Sciences of Australia v Leslie as previously referred to. Then, after reviewing some documentary material, her Worship concluded that the relocation from Penrith to Bonnyrigg cost the respondent, or resulted in him losing, approximately $160 per week. Although there was a dispute about the precise amount of the loss, her Worship said that that only corroborated the complaint made by the respondent that there was a substantial loss. 23 Her Worship then went on to say: The complainant gave evidence of the payments or the problems with picking up the children after school. His hours of work at Penrith had been from 5 till 2.30 and obviously because of the time, the two hours and the three hours which was structured into his pay, there would not have been I'd imagine the same need for overtime. We have two hours at time and a half and three hours of double time which was structured into his payment. He states that as a result of going to Bonnyrigg he had longer travelling and one look at the map could see that from Penrith to Winmalee is a much shorter space than from Winmalee to Bonnyrigg and 1 don't think there's any dispute that he did incur extra travelling time which would have made differences to picking children up. It would also have incurred extra petrol costs, extra wear and tear on the car. Looking at the test I find the complainant, who had the onus on the balance of probability, has satisfied that test and accordingly I FIND FOR THE COMPLAINANT. He is entitled to long service leave as per the amount claimed. 24 Orders were made by her Worship accordingly, with interest and costs in favour of the respondent. CONSIDERATION 25 The approach to follow in this matter is as enunciated earlier in these reasons by reference to the extract from Computer Sciences of Australia v Leslie. We confirm that test, long settled and applied as it is, and agree with it as a statement of the proper legal principle to follow in the determination of the issue arising in this appeal. 26 We would only add for completeness, in order to demonstrate the necessary causal nexus between a termination of employment by an employee and the reason therefor sufficient to attract the entitlement to a proportionate long service leave payment under the statute, what was said, and with which we agree, by Beattie and Perrignon JJ in British Motor Corporation (Aust) Pty Ltd v Chance [1965] AR (NSW) 364 at 38 1, as follows: The Long Service Leave Act, 1955-1963, prescribes for workers an entitlement to long service leave. Pursuant to s. 4 (2) (a) (iii) the amount of such leave to which a worker is entitled is "in the case of a worker who has completed with an employer at least five years service as an adult, and whose services are terminated by the employer for any reason or by the worker on account of illness, incapacity or domestic or other pressing necessity, or by reason of the death of the worker", a proportionate amount on a basis specified. The section refers to three different circumstances, each of which involves the termination of a worker's services. The first is where the services were terminated by the employer "or any reason" The second is where the services are terminated by the worker " on account of illness, incapacity or domestic or other pressing necessity". The third is where the services are terminated "by reason of the death of the worker". In the third case the notion involved in the phrase "by reason of' is plainly causation: if death causes the termination, a right accrues. The phrase used in the second case, "on account of", means "because of", and again the notion of causation is involved: if the worker terminates his employment because of, for example, illness, again a right accrues. And we think that in the first case, where the phrase is "for any reason", that the notion of causation is also present: if the employer terminates the worker's services because of any reason at all, a right to leave accrues. Each of the three cases deals therefore with cause and effect. 27 It is necessary, of course, for a worker seeking to come within the qualifying provisions of s4(2)(a)(iii) of the Long Service Leave Act to establish that he or she does so on the balance of probabilities. 28 In essence, the respondent asserted that the circumstances which motivated him to terminate his employment, and which could be characterised as domestic or other pressing necessity, were the loss of income occasioned by the changed working conditions when he was transferred from the Penrith to the Bonnyrigg depot and the inability to collect his children from school three afternoons a week. 29 This latter aspect may be dealt with quite shortly. The respondent said his new employment, following the termination of employment with the appellant, satisfied his dual needs of increased earnings and a job closer to home. Nevertheless, the arrangement between Mrs Doust and his wife has continued to the effect that between them his children are met at school each day without the need for his personal attendance. Whilst there was no longer any cost involved, this was due to the changed arrangement apparently negotiated by the respondent's wife and Mrs Doust. There was no suggestion in any of the evidence in these proceedings that the changed arrangements were brought about as a result of any intervention by the respondent and there was simply no evidence that such an arrangement as currently existed presented any inconvenience of any kind for the respondent or his family. There was similarly no evidence that the changed arrangements in terms of the cost of $45 per week bore any relationship, either directly or indirectly, to the respondent's circumstances while employed by the appellant. 30 We are of the opinion that the respondent did not make out any case before the industrial magistrate of domestic or other pressing necessity by reference to the fact that he was unable, on transfer to Bonnyrigg, to collect his children from school. 31 The remaining matter involves a consideration as to whether a loss to the order of $97 per week constituted a domestic or other pressing necessity as would demonstrate the necessary causal connection with the termination of employment by the respondent. It is a trite observation that loss of income will almost always impact upon the available financial resources of a family. However, circumstances will obviously vary in determining the extent to which such a loss of income will impact upon a family. In some circumstances a loss of about $97 per week may have disastrous consequences on the ability of a family to maintain a decent or basic living standard; in others, a loss of that magnitude may impact only in the area of discretionary spending. 32 The difficulty arising here was that the respondent chose to put his case on the basis of a bald assertion of the manner in which the loss of income impacted upon his and his family's financial situation. The evidence he gave in that regard has been summarised earlier. However, the respondent chose, for reasons which perhaps were misguided, not to give to the industrial magistrate any information as to his overall financial circumstances or those of his family. He specifically declined to produce documentation in response to a subpoena served upon him and asserted it was not "any of your business". In that situation, it must, we think, be concluded that it was not reasonably possible for the industrial magistrate to determine whether the loss of income, about which there can be no dispute, created circumstances amounting to domestic or other pressing necessity. 33 Was it necessary for the respondent to have terminated his employment with the appellant because of this loss of income? Such a question can only be answered if the respondent had put before the industrial magistrate sufficient information to enable such a determination to be made. This might include, for example, details of the total available income of the family both before and after the transfer to Bonnyrigg and details of the family's expenditure and other commitments whether of a regular or irregular nature. Such evidence would enable the establishment of an overall picture of the applicant's financial position and that of his family which would in turn enable a determination to be made as to whether the relevant necessity as required by the legislation had been established. In the absence of any such evidence, there was no proper evidentiary basis upon which her Worship could determine the issue before her. In order to discharge an obligation of the kind imposed by s4(2)(a)(iii) of the Long Service Leave Act it is necessary, it seems to us, for a claimant to go beyond the mere bald assertion made by the respondent in this case. Such an assertion in effect amounts to a conclusion. In adopting such a conclusion, the industrial magistrate here fell into error. 34 The appeal must succeed because the respondent failed to make out a case at first instance and the decision so impugned cannot be allowed to stand. 35 One may have some sympathy for the respondent on having failed because not all of the relevant evidence was led in the proceedings. Nevertheless, what must be borne in mind is that "an employer required to grant the substantial benefits of this legislation is entitled to have the worker complete the minimum unconditional qualified period unless the contingencies provided with respect to earlier terminations are clearly met": per Watson, Bauer and Glynn JJ in Computer Sciences of Australia Pty Ltd v Leslie at p 832. This is a case where the worker failed to establish that those contingencies had been clearly met. 36 As to costs, we are of the opinion that the circumstances of this case are such that it is appropriate for each party to bear its own costs, both at first instance and on appeal. ORDERS 37 We make the following orders in disposition of this appeal: 1. Leave to appeal is granted. 2. The appeal is allowed. 3. The decision of the Local Court given on 14 July 1998 and the consequent orders made are quashed. 4. The subject complaint and summons before the Local Court are dismissed. 5. Each party to bear its own costs at first instance and of the appeal. ________________ DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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