Andrew Matthews v Redflex Traffic Systems Pty Ltd [2017] FWC 353

1 Fair Work Act 2009 s.394—Unfair dismissal Andrew Matthews v Redflex Traffic Systems Pty Ltd (U2016/10876) SENIOR DEPUTY PRESIDENT DRAKE SYDNEY, 19 JANUARY 2017 Application for relief from unfair dismissal. [1] This decision arises from an application by Mr Andrew Matthews for an extension of time for lodgement of an application for an unfair dismissal remedy pursuant to section 394 of the Fair Work Act 2009 (the Act). [2] Mr Matthews’ employment ended on 2 May 2016. Mr Matthews lodged his application for unfair dismissal remedy with the Fair Work Commission (Commission) on 1 September 2016. For his application to have been lodged within the time limits prescribed by the Act Mr Matthews’ application should have been made by 23 May 2016. Mr Matthews’ application is 101 days out of time. [3] Redflex Traffic Systems Pty Ltd (Redflex) objects to Mr Matthews’ application on a number of grounds including that the application was out of time, the dismissal was a genuine redundancy and that Mr Matthews’ earned more than the high income threshold. [4] I wrote to Mr Matthews on 13 September 2016 outlining the matters I was required to consider by the Act in respect of an extension of time and requesting that he respond within 14 days. A response was received from Mr Matthews on 26 September 2016. [5] I heard Mr Matthews’ application for an extension of time in Sydney on 4 November 2016. Both parties appeared at this hearing. Given the nature of the objections raised by Redflex I put to the parties that it would be more convenient to deal with the extension of time application and the objection in respect of the high income threshold jointly. There was no objection to this course. Following the hearing I provided both parties with a further opportunity to file any material in relation to the jurisdictional objections and in particular the matters raised during the hearing. High Income Threshold [6] Section 382 of the Act provides: [2017] FWC 353 DECISION -- 1 of 8 -- [2017] FWC 353 2 “382 When a person is protected from unfair dismissal A person is protected from unfair dismissal at a time if, at that time: (a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and (b) one or more of the following apply: (i) a modern award covers the person; (ii) an enterprise agreement applies to the person in relation to the employment; (iii) the sum of the person’s annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold.” [7] At the time of Mr Matthews’ dismissal, the high income threshold was $136,700. Mr Matthews has not asserted that he was covered by a modern award or that an enterprise agreement applied to him in relation to his employment. [8] Redflex submits that the sum of Mr Matthews’ earnings including his base salary and other amounts was greater than the high income threshold. Redflex states that Mr Matthews’ base salary was $136,218.00 and that the Commission should include in his earnings a further $9,000 in respect of a motor vehicle and $1,775 in relation to the provision of a mobile phone. Redflex submitted that the motor vehicle should be apportioned 50% personal usage and the mobile phone 20% personal usage. [9] It is not in dispute that Mr Matthews’ base salary at the time of dismissal was $136,218.1 There is no agreed value assigned to the motor vehicle, nor has either party maintained any records in respect of the vehicles use. However, Mr Matthews does not dispute that there was no restriction on his use of the motor vehicle and that he did use it for personal purposes.2 Mr Matthews accepted that over a year it was likely that the value of the vehicle would be more than the small difference between his base salary and the high income threshold.3 Mr Matthews did not dispute the calculation that Redflex has performed to assign a value to the vehicle. [10] In his further submissions, Mr Matthews points to the fact that in respect of his remuneration dispute with Redflex, Redflex maintained that in respect of the motor vehicle “there is no evidence that Mr Matthews’ remuneration was, or subsequent reviews were, adversely affected by the conferring of this benefit or that the conferring of this benefit represented a portion of his base salary”. [11] The effect of s.332(1)(d) of the Act and r.3.05(6) of the Regulations is that where the Commission is satisfied that it is appropriate to do so the Commission has a discretion to include a benefit that is not the payment of money and is otherwise not a non-monetary benefit. The Commission can take into account the ‘real or notional money value’ of the benefit where it is able to estimate such a value. -- 2 of 8 -- [2017] FWC 353 3 [12] Given that Mr Matthews accepts that he had unrestricted use of the motor vehicle, that he did use it for personal use, and that the value of the vehicle is not in dispute, that its value is substantial, that Mr Matthews’ base wages are almost equal to the high income threshold and that Mr Matthews’ concedes it is likely that the value of the vehicle would take him over the high income threshold, I consider it appropriate that I estimate a value for the vehicle and consider that value for the purposes of the high income threshold. [13] There are a number of methods that the Commission and its predecessors have used to estimate values for benefits employees receive. Generally, the Commission applies a formula that determines a value in respect of motor vehicles using a percentage of the annual distance travelled in the vehicle that is attributable to use for private purposes.4 Neither party has maintained any records in relation to the vehicle’s use meaning that it is not possible for me to take that approach. For the reasons stated above, and because the Regulations simply refer to an estimate being made by the Commission, I still consider it appropriate to take into account an estimated notional money value of the vehicle. [14] The RACQ’s price guide estimates the value of a 2013 Ford Territory Titanium (4x4) Wagon to be between $33,615 and $34,500. Using the statutory method of calculating fringe benefits tax on the current market price of $33,615, the ATO estimates the “gross taxable value” of the car to be $6,723. Assuming that Mr Matthews used the vehicle for private purposes for even 10% of the time it was available, I consider an appropriate estimate of the money value of the vehicle to be $672.30. Taking into account this fairly conservative estimate, on the information before me Mr Matthews’ earnings are at least $136,890.30, which is greater than the high income threshold at the time of his dismissal. [15] Redflex has led no evidence that would enable me to appropriately estimate the value of the mobile phone but given my findings in respect of the motor vehicle it is not necessary that I do so. [16] I am satisfied and find that the sum of Mr Matthews’ annual rate of earnings and other amounts calculated in accordance with the Regulations is not less than the high income threshold. It is not asserted that Mr Matthews was either covered by a modern award or that an enterprise agreement applied to his employment. Considering the nature of Mr Matthews’ past position I am satisfied that this would in any event be unlikely to be the case. I am satisfied that Mr Matthews is not a person who was protected from unfair dismissal at the time of his dismissal. On this basis his application must be dismissed. Extension of time [17] In the event that I am mistaken concerning the high income threshold and because the parties have made submissions in relation to an extension of time for lodgement, I will also consider whether I otherwise would have granted an extension of time. [18] The relevant legislative framework for the exercise of the Fair Work Commission’s discretion in relation to applications of this kind is set out in s.394 of the Act: 394 Application for unfair dismissal remedy ... (3) The FWC may allow a further period for the application to be made by a person -- 3 of 8 -- [2017] FWC 353 4 under subsection (1) if the FWC is satisfied that there are exceptional circumstances, taking into account: (a) the reason for the delay; and (b) whether the person first became aware of the dismissal after it had taken effect; and (c) any action taken by the person to dispute the dismissal; and (d) prejudice to the employer (including prejudice caused by the delay); and (e) the merits of the application; and (f) fairness as between the person and other persons in a similar position. [19] The meaning of “exceptional circumstances” was considered in Nulty v Blue Star Group Pty Ltd [2011] FWAFB 975. The Full Bench stated: “[10] It is convenient to deal first with the meaning of the expression “exceptional circumstances” in s.366(2). In Cheval Properties Pty Ltd v Smithers a Full Bench of FWA considered the meaning of the expression “exceptional circumstances” in s.394(3) and held: “[5] The word “exceptional” is relevantly defined in The Macquarie Dictionary as “forming an exception or unusual instance; unusual; extraordinary.” We can apprehend no reason for giving the word a meaning other than its ordinary meaning for the purposes of s.394(3) of the FW Act.” [11] Given that s.366(2) is in relevantly identical terms to s.394(3), this statement of principle is equally applicable to s.366(2). [12] The ordinary meaning of the expression “exceptional circumstances” was considered by Rares J in Ho v Professional Services Review Committee No 295 a case involving in s.106KA of the Health Insurance Act 1973 (Cth). His Honour observed: “23. I am of opinion that the expression ‘exceptional circumstances’ requires consideration of all the circumstances. In Griffiths v The Queen (1989) 167 CLR 372 at 379 Brennan and Dawson JJ considered a statutory provision which entitled either a parole board or a court to specify a shorter non-parole period than that required under another section only if it determined that the circumstances justified that course. They said of the appellant’s circumstances: ‘Although no one of these factors was exceptional, in combination they may reasonably be regarded as amounting to exceptional circumstances.’ 24. Brennan and Dawson JJ held that the failure in that case to evaluate the relevant circumstances in combination was a failure to consider matters which were relevant to the exercise of the discretion under the section (167 CLR at 379). Deane J, (with whom Gaudron and McHugh JJ expressed their concurrence on this point, albeit that they were dissenting) explained that the power under consideration allowed departure from the norm only in the exceptional or special case where the circumstances justified it (167 CLR at 383, 397). 25. And, in Baker v The Queen (2004) 223 CLR 513 at 573 [173] Callinan J -- 4 of 8 -- [2017] FWC 353 5 referred with approval to what Lord Bingham of Cornhill CJ had said in R v Kelly (Edward) [2000] QB 198 at 208, namely: ‘We must construe “exceptional” as an ordinary, familiar English adjective, and not as a term of art. It describes a circumstance which is such as to form an exception, which is out of the ordinary course, or unusual, or special, or uncommon. To be exceptional a circumstance need not be unique, or unprecedented, or very rare; but it cannot be one that is regularly, or routinely, or normally encountered.’ 26. Exceptional circumstances within the meaning of s 106KA(2) can include a single exceptional matter, a combination of exceptional factors or a combination of ordinary factors which, although individually of no particular significance, when taken together are seen as exceptional. Thus, the sun and moon appear in the sky everyday and there is nothing exceptional about seeing them both simultaneously during day time. But an eclipse, whether lunar or solar, is exceptional, even though it can be predicted, because it is outside the usual course of events. 27. It is not correct to construe ‘exceptional circumstances’ as being only some unexpected occurrence, although frequently it will be. Nor is it correct to construe the plural ‘circumstances’ as if it were only a singular occurrence, even though it can be a one off situation. The ordinary and natural meaning of ‘exceptional circumstances’ in s 106KA(2) includes a combination of factors which, when viewed together, may reasonably be seen as producing a situation which is out of the ordinary course, unusual, special or uncommon. And, the section is directed to the circumstances of the actual practitioner, not a hypothetical being, when he or she initiates or renders the services.” [13] In summary, the expression “exceptional circumstances” has its ordinary meaning and requires consideration of all the circumstances. To be exceptional, circumstances must be out of the ordinary course, or unusual, or special, or uncommon but need not be unique, or unprecedented, or very rare. Circumstances will not be exceptional if they are regularly, or routinely, or normally encountered. Exceptional circumstances can include a single exceptional matter, a combination of exceptional factors or a combination of ordinary factors which, although individually of no particular significance, when taken together are seen as exceptional. It is not correct to construe “exceptional circumstances” as being only some unexpected occurrence, although frequently it will be. Nor is it correct to construe the plural “circumstances” as if it were only a singular occurrence, even though it can be a one off situation. The ordinary and natural meaning of “exceptional circumstances” includes a combination of factors which, when viewed together, may reasonably be seen as producing a situation which is out of the ordinary course, unusual, special or uncommon.” [Endnotes not reproduced] [20] For exceptional circumstances to arise as contemplated by s.394 of the Act, it is not necessary that the applicant for that extension of time be overtaken by a catastrophic event. Reasons for delay in the category of extreme events are not necessary to meet the test. The factors outlined in s.394(3) must be considered and weighed when deciding whether or not exceptional circumstances, circumstances sufficient to support an exception, exist. -- 5 of 8 -- [2017] FWC 353 6 [21] I will now consider the various criteria under s.394(3) of the Act. reason for the delay-s.394(3)(a) [22] The reasons Mr Matthews provided for the delay in making his application for unfair dismissal remedy are: 1. that from 2 May 2016 until 19 August 2016, the Applicant had “no reason to believe that [his] redundancy was anything other than genuine”; 2. that on 19 August 2016 Mr Matthews became aware that his position had been replaced by an employee in Redlfex’s Melbourne office; and 3. that he took the period between 19 August 2016 and 1 September 2016 to consider the merits of his application make a submission to the Commission. [23] Mr Matthews’ further submissions, and Form F2 application, indicate that in the “…several weeks following [his] termination” he was alerted through social chatter that an employee had commenced in Melbourne. [24] The Applicant had legal representation following his dismissal but Mr Matthews maintains that, given his view at the time that his redundancy was genuine, he did not receive advice to the contrary. Representative error was not relied upon as a contributing factor to the delay. whether the person first became aware of the dismissal after it had taken effect- s.394(3)(b) [25] Mr Matthews’ termination was effective on 2 May 2016 and there is no dispute that he was aware that his dismissal was effective on this date. This is a factor against an extension of time being granted. any action taken by the person to dispute the dismissal-s.394(3)(c) [26] Mr Matthews has not taken any action to dispute the dismissal prior to the making of the present application. During the dismissal meeting on 2 May 2016 the Applicant did query with the Group CEO of Redflex regarding the reasons for the redundancy and was advised that Redflex was “…looking at outsourcing its maintenance operations”. There is correspondence before the Commission in relation to an entitlements and contractual dispute between the parties which appears to have been agitated in the weeks following dismissal. [27] There is no evidence before me of any action taken by Mr Matthews to dispute his dismissal prior to the present application being filed. However, given the context of this application this is perhaps not surprising. This is a neutral consideration in my determination. prejudice to the employer-s.394(3)(d) [28] The Respondent has not asserted any prejudice beyond that ordinarily felt by an employer in defending an unfair dismissal application. I am satisfied that there would be no greater prejudice to the respondent caused by Mr Matthews’ application being listed now than -- 6 of 8 -- [2017] FWC 353 7 there would have been had it been lodged in time. Prejudice to the respondent was a neutral consideration. the merits of the application-s.394(3)(e) [29] I have already indicated that Redflex would be successful in one of the jurisdictional objections. This weighs against an extension of time being granted. fairness as between Matthews and other persons in a similar position-s.394(3)(f) [30] There was no issue of fairness in relation to any other person in a similar position. [31] I do not consider that Mr Matthews acted sufficiently promptly in considering his suspicions concerning his redundancy, nor in acting to lodge his application when he first observed what he considered to be a suspicious advertisement. Having considered all of the matters to which my attention is directed by the Act I am not satisfied that there are exceptional circumstances which would warrant my granting an exception to the statutory time limit and on that basis I would in any event have dismissed the application. Mr Matthew’s circumstances were not out of the ordinary course, unusual, special or uncommon. SENIOR DEPUTY PRESIDENT Appearances: A. Matthews on his own behalf. A. Marriott for Redflex Traffic Systems Pty Ltd. Hearing details: 2016. Sydney: 4 November. Printed by authority of the Commonwealth Government Printer <Price code C, PR589476> -- 7 of 8 -- [2017] FWC 353 8 1 PN57; Applicant’s further submissions dated 16 November 2016. 2 PN48 to PN49; Applicant’s further submissions dated 16 November 2016. 3 PN52. 4 Kunbarllanjnja Community Government Council v Fewings (AIRCFB, Ross VP, Watson SDP, Bacon C, 7 May 1998) Print Q0675; cited in Chang v Ntscorp Ltd [2010] FWA 1952 (Hamberger SDP, 9 March 2010); see McIlwraith v Toowong Mitsubishi Pty Ltd [2012] FWA 3614 (Cribb C, 30 April 2012) [34]. -- 8 of 8 --