Cox of the Department of Employment, Training and Industrial Relations v Life’s a Beach Australia Pty Ltd [2001] QIRC 8 (2001) 166 QGIG 167

9 February, 2001 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 167 ########################################################################################################################### QUEENSLAND INDUSTRIAL RELATIONS COMMISSION Industrial Relations Act 1999 – s. 278 – application for unpaid wages David Cox of the Department of Employment, Training and Industrial Relations AND Life’s a Beach Australia Pty Ltd (No. W211 of 2000) COMMISSIONER THOMPSON 31 January 2001 Unpaid wages – Retail Industry – Annual Leave – Witness evidence – Arbitrated Matter – Order by Commission DECISION This matter was before the Commission following an application from Mr David Cox of the Department of Employment, Training and Industrial Relations seeking that Life’s a Beach Australia Pty Ltd be ordered to pay monies to the amount of $3,302.83 to Ms Michelle Lambart being for unpaid wages owed at the time of her termination. -- 1 of 3 -- 168 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 9 February, 2001 Ms Lambart was employed as a full-time shop assistant on a negotiated salary of $665.00 per week which is an amount in excess of more than 125% of the rate of pay prescribed in the Award for a shop assistant and, under the Retail Industry Interim Award – State, is therefore a person with the status of being exempted from a number of award provisions. “1.2 Award Coverage This Award with the exception of clauses 3.5 [Occupational Superannuation], 5.1 [Annual Leave], 5.2 [Statutory Holidays], 5.3 [Sick Leave] and 5.4 [Long Service Leave] with the exception of the employees engaged in a demonstration and/or sale and/or hire and/or rental of television receivers and the parts in the homes of prospective clients shall not apply to employees in receipt of a weekly wage which is equal or greater than 125% of the rate prescribed in the award for shop assistants. This amount shall be inclusive of bonuses or commissions. . .”. Whilst there was a previous employment relationship between Ms Lambart and a company owned by the respondents, the commencement of the employment period relating to this matter was from December 1997 until either 20 or 21 November 1999, dependent upon whether there is acceptance of 20 November 1999 as the completion date shown on the Group Certificate issued to Ms Lambart by the respondent for the financial year commencing 1 July 1999 to 30 June 2000 or, as provided in evidence by Ms Lambart, 21 November 1999 being her final day of employment, the day upon which sick leave was taken. An employment contract between the parties was signed in December 1997 and had an finite life of twelve (12) months from date of signing and included clauses that reduced the annual leave component for Ms Lambart from four (4) to two (2) weeks per annum and omitted any entitlement to paid sick leave. The agreement did not meet the requirements of the Industrial Relations Act 1999 (the Act), nor was it subject to approval by the Commission. Shortly after the end of the employment relationship, Ms Lambart lodged a complaint with the Southport office of the Department of Employment, Training and Industrial Relations stating that the respondent had failed to pay wages for the final week of her employment, sick pay, and pro rata annual leave at the point of termination. Mr Clement Williams, a duly authorised inspector, appointed under the Act, was given the responsibility of investigating the complaint and, in his affidavit, provided a comprehensive report of his investigation including certain admissions made by one of the directors of the respondent company, Mr Brenden Shakespeare, during the course of an interview conducted on 14 January 2000. The evidence of Mr Williams was concise, to the point and, more importantly, uncontested by the respondent during the course of the hearing. Ms Lambart, in evidence, provided specific details relating to her employment, including matters pertaining to duties, wages, annual leave, sick leave, and the termination of her employment. Further, reference was also made to an arrangement entered into at the commencement of the employment for the respondent to meet an outstanding tax liability left over from her previous employment with a company operated by current directors of the respondent company. In respect of the termination issue, Ms Lambart’s evidence was that the period of notice as required under the Award was not “worked out” due to a mutual understanding between Ms Lisa McCubbin, a co-director of the respondent company, and herself to cease employment on 21 November 1999. Life’s a Beach Australia Pty Ltd director, Mr Shakespeare, who also assumed the role of advocate in this matter, acknowledged in evidence that it had been mutually agreed between Ms Lambart and the respondent that in turn for receiving a wage rate which was some 42% above the Award rate of pay applicable for her classification level, that the annual leave entitlement of four (4) weeks would be reduced to two (2) weeks per annum and, additionally, paid sick leave would not be applicable. At paragraph 15 on page 2 of Mr Shakespeare’s affidavit, he made the following comment in respect of the employment agreement that had been signed by the parties. “The agreement signed by the parties does not comply with the provisions of the Industrial Relations Act 1999, however the agreement does not disadvantage the applicant, in fact her benefits were greater than those that would be available under the award . . .”. In summary, Mr Cox stated, “Not one line of Inspector Williams’ statement was disputed . . .” and has such confirmed there did not appear to be any dispute by the respondent that the wages were not owed to Ms Lambart. He identified the five (5) clauses of the Award that remained applicable to an exempt employee and highlighted in particular clauses 5.1 (Annual Leave) and 5.3 (Sick Leave) as being the basis upon this application being made to the Commission. In respect of the Annual/Sick Leave provisions, he pointed out that the Award did not provide a mechanism to allow for the variation of those clauses to reduce entitlements due to employees. It was also argued that the period of notice to be given by shop assistants under clause 2.1 of the award did not apply to Ms Lambart as she was an exempt employee. Mr Cox in a reference to s. 135 of the Act indicated that where an inconsistency existed between an award and a contract of service, the Award prevails over the contract. Finally, evidence relating to an arrangement between the parties facilitating the payment of an outstanding taxation debt had no relevance to the matter subject to these proceedings. Mr Shakespeare, in his submissions, indicated that a comparison between monies paid to Ms Lambart during the course of her employment, and what her entitlements were under the Award, were sufficient to meet all outstanding monies being claimed if her service had been calculated at the Award rate of pay. He stated that the refusal of the respondent to make payment for the final week of the employment was due to the failure Ms Lambart to give the correct period of notice as required and refuted the claim that a verbal agreement had been reached with Ms McCubbin to reduce the notice period. Mr Shakespeare requested the Commission acknowledge that the payment of Ms Lambart’s outstanding taxation bill formed part of her salary for the 1997-1998 financial year. The Commission was also requested to exercise a discretionary power and not order the payment of the monies being sought in relation to pro rata annual leave. In determining this matter, it was necessary to consider the application in two (2) parts. Firstly, the claim for wages for the period 15 to 21 November 1999 (inclusive) being for the final week of the employment, and secondly, the claim for unpaid pro rata annual leave for the period 18 December 1998 until 21 November 1999 (inclusive). -- 2 of 3 -- 9 February, 2001 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 169 S:\QIRCDEV-BASE\QGIG\2001\166\NO.6 09.02.01.DOCno.6 09.02.01 The first section of the claim was for the payment of four (4) days plus one (1) day sick leave (21 November 1999) being the final week of employment. It was not disputed by the respondent that Ms Lambart had in effect worked the four (4) days, however, the basis upon which the payment was withheld was in the view of the respondent the failure to provide and to work out a period of notice in accordance with the Award. Mr Cox put forward a position that as an exempted employee under clause 2.1 of the Award, there was not a requirement on Ms Lambart to provide a period of notice. Evidence from Ms Lambart was that a verbal agreement had been reached between Ms McCubbin which facilitated the employment ceasing on 21 November 1999. I accept the evidence of Ms Lambart in respect of this matter and it is my understanding that the practice of reaching mutual agreement to reduce periods of notice for people terminating their employment is not an uncommon occurrence in the workplace. In respect of the claim for one (1) day’s sick leave, I am of the view that the Award allows for the payment of sick leave to Ms Lambart, however, considering that the day claimed was to be the last day of employment, there is, in my view, some question over the genuineness of the claim for sick leave and on that basis I reject the applicant’s request that one (1) day’s sick leave be paid. The matter of annual leave is quite simple in that the Award provides:– “If the employment of any employee is terminated at the expiration of a full year of employment, the employer shall be deemed to have given the holiday to the employees from the date of the termination of the employment and shall forthwith pay to the employee in addition to all other amounts due to the employee, the employee’s pay, calculated in accordance with subclause (2) hereof, for four weeks and also the employee’s ordinary hours pay for any statutory holiday occurring during such period of four weeks. If the employment of any employee is terminated before the expiration of a full year of employment, such employee shall be paid, in addition to all other amounts due to the employee, an amount equal to one-twelfth of the employee’s pay for the period of the employee’s employment, calculated in accordance with subclause (2) hereof.”. I determine that the claim on behalf of Ms Lambart for annual leave in accordance with schedule 1 of the application is a bona fide claim. Accordingly, I order that the respondent pay the amount of $3,169.83 gross to the Department of Employment, Training and Industrial Relations on behalf of Ms Lambart within twenty-two (22) days of the release of this decision. J. THOMPSON, Commissioner. Released: 1 February 2001 Appearances:– Mr D. Cox for the Department of Employment, Training and Industrial Relations. Mr B. Shakespeare of Life’s a Beach Australia Pty Ltd. -- 3 of 3 --