WESTERN AUSTRALIAN INDUSTRIAL MAGISTRATES COURT

PARTIES TERENCE WILLIAM MILES

CLAIMANT

-v-

Brendon Penn Nominees Pty Ltd

RESPONDENT

CORAM INDUSTRIAL MAGISTRATE W.G. TARR

HEARD Thursday, 29 March 2007

DELIVERED Thursday, 29 March 2007

CLAIM NO. M 238 OF 2004

CITATION NO. 2007 WAIRC 00407

Representation 

Claimant  Mr P Brunner (of Counsel) instructed by Kott Gunning Lawyers appeared for the Claimant.

Respondent  Mrs C McKenzie (of Counsel) instructed by McKenzie Lalor, Barristers and Solicitors appeared for the Respondent.

REASONS FOR DECISION

(Given extemporaneously at the conclusion of submissions.  Extracted from

the transcript of proceedings and edited by His Honour)

1         This matter has come back to me by order of the Full Bench of the Western Australian Industrial Relations Commission as a result of an appeal to that body.  The decision was delivered on 24 November 2006 and the Full Bench remitted the matter back to me for further hearing and determination according to law in light of its finding that the Claimant was in fact an employee and not a subcontractor.

2         The original claim was made under the Workplace Relations Act 1996 (the Act), which is a Commonwealth Act, and when dealt with by me I was exercising the Federal jurisdiction as an eligible Court as provided for in section 170NE of the Act.  Under the Act any appeal from a Magistrates Court lies to the Court which is defined as the Federal Court of Australia in section 4(1).  (See section 422(1) of the Act).

3         I make that comment and say that the Full Bench of the Western Australian Industrial Relations Commission is a creature of statute and its appeal jurisdiction is clearly set out in Part III (section 84) of the Industrial Relations Act 1979.  It had no jurisdiction to hear an appeal from this Court when exercising its Federal jurisdiction.

4         I accept however that I am bound at this stage by the decision of the Full Bench and I am dealing with this matter on that basis.  I do not intend to go through all the evidence generally.  There are certain findings that I made which have not been overturned by the Full Bench.  My finding was that there was an agreement between the parties, which was not a sham, and as I have said, although the agreement was oral and lacked detail, I was satisfied that both parties understood what was agreed and this was demonstrated by the performance and expectations of each.  The Claimant as I have said initiated and accepted the arrangement willingly and accepted the conditions agreed.  He was prepared to work as many hours as agreed at the rate that was agreed, which was well above the award rate.

5         I have been referred to the case of James Turner Roofing v Peters 83 WAIG 427, as was the Full Bench, but it seems to me that this claim can be distinguished to some extent from that case in that it was James Turner Roofing, the employer, which considered Peters, the employee, to be a subcontractor.  Peters had always considered himself to be an employee and complained about the entitlements that were due to him almost, as was mentioned in that case “from the inception of the employment”.  He complained on a regular basis, it would seem, about overtime, public holidays, redundancy, rest and meal breaks, and rostered days off.

6         In James Turner Roofing it was held that there was an agreed rate of $25.00 an hour which was considered an “all in” rate for the hours worked.  The Industrial Appeal Court considered the so called “set off” rules and held that set off came about in relation to those items which were contemplated by the employee or employer at the time.  It allowed a set off in relation to some of those payments.

7         In my view this case can be distinguished to some extent from James Turner Roofing in that it was clearly the intentions of the parties that all entitlements that were payable to Mr Miles were to be included in the hourly rate that was being paid.  I suppose what I should have found, and I believe I did in as many words, that, having been corrected in relation to the relationship between the parties, it is fairly clear to me on the evidence that the parties were bound by the Mobile Crane Hiring Award 2002 (the Award), and I am approaching these reasons on that basis, that the parties were bound by the Award and I do not believe there is any merit in any argument to the contrary.

8         There are a number of items which are payable under the Award which have been set out, as it happens, by the Respondent and that includes those general items that are considered on a weekly or monthly basis as they become due, for example, the ordinary rate, the overtime rate (one and a half times or double time), travel, meal allowances, public holidays, living away from home allowance, and shift work.  They are all items that Mr Miles accepted as being included in the hourly rate he was paid.

9         Mr Penn said that he turned his mind to the Award when calculating what would be an appropriate rate which would cover all the obligations on him under the Award and it seems on the evidence before me that in relation to those items the hourly rate that was paid to Mr Miles covered all of those items and in fact he was paid more than he was entitled to under the Award. For three years he made no complaint compared with Peters in James Turner Roofing who had an expectation in relation to those items that I have mentioned at an early stage in the employment relationship or during his employment.

10      So the fact that Mr Miles was paid in excess of his entitlement in relation to those payments that would be expected to be considered, probably weekly if the pay period was weekly, any shift work, any overtime, any travel would be included in that weekly payment.  The evidence before me is that there was an expectation that any leave entitlements would be included in the hourly rate, and it seems by the performance of Mr Miles and the Respondent that there was no expectation that Mr Miles would be paid for public holidays.  As I said, in view of the amount paid there cannot be, in my view, any claim that there was a breach of the Award by way of an underpayment and even if there were an underpayment in relation to any particular entitlement, it could be “set off” by any overpayment under the Award. There is no evidence that he was in fact underpaid.  It seems to me in relation to those matters that there is no breach.

11      It is the case in relation to redundancy and notice that the authorities suggest that the parties cannot turn their mind to something that may or may not happen in the future, and I do not think there is any suggestion on the evidence that the parties turned their mind to notice or redundancy pay, although Mr Miles did concede that he was surprised when he was paid two weeks redundancy.

12      The authorities are quite clear that if an award applies the parties cannot contract out of that award, and that any entitlements under the award are payable.  As I have said in relation to James Turner Roofing, there are some items which it was said that the parties could not have turned their mind to in particular and it seems to me the issue of notice and the issue of redundancy does not become an issue until the end of the term of employment.

13      I should also address the issue of estoppel as it has been raised.  I decided in my decision, as it turned out wrongly, that Mr Miles was estopped from claiming to be an employee.  But having said that I do not believe that estoppel as it has subsequently been raised could apply to something which is provided for in the Award and which could not have been in the contemplation of the parties at the time.  As I have indicated, the parties cannot contract out of the Award and it follows that any payments due in relation to notice and redundancy cannot be set off as provided in the case of James Turner Roofing and I am required to allow that part of the claim.

14      I dealt with the issue of superannuation.  I do not believe I have any need or power to make any orders in relation to that.  I have found that the parties, for the reasons that I have given, turned their mind impliedly to the matters that have been claimed by way of annual leave, annual leave loading, traveling allowance, meal allowance, public holidays, living away from home allowance and shift penalties, but I believe that I am required to make an order in relation to notice and redundancy.

15      I am prepared to allow interest at the rate of 6 per cent from the date of the claim, being 8 September 2004, but I do not believe that a penalty is appropriate.  This is a case where the Claimant as I have found was very instrumental in the relationship between the parties being as it was.  Mr Penn was not keen, as I understand from the evidence, on making an exception for the Claimant but agreed to on Mr Miles’ insistence and Mr Penn cannot be criticised for that.  It does not seem to me to be a case where a penalty is appropriate.

16      There will be an order that the Respondent pay the Claimant the sum of $6677.50, plus interest at the rate of 6 per cent with effect from 8 September 2004 and the question of costs will be adjourned.

WG Tarr

Industrial Magistrate