Full decision here.
Introduction
You may recall, the controversy stirred up by the Federal Court (Skene v Workpac) in awarding a casual labour-hire employee leave entitlements, and possibly changed the way we now treat casual employees) – and yet we still do not have a legislated definition of a casual employee.
The labour-hire company successfully argued the FWC lacked jurisdiction to deal with unfair dismissal because the applicant was not dismissed, on the basis that there is no reasonable prospect of success.
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Background
The Applicant was employed on 10 April 2015 as a casual employee. The Applicant was assigned to a client of the Respondent, on 21 April 2015. The Applicant became unwell on 13 June 2019, provided a medical certificate, and was unfit for work. The Applicant remains unfit for work as at the date of this decision.
On or about 15 August 2019, Anglo informed the Respondent of reduced manning requirements, meaning the role of the Applicant was no longer required. The Respondent attempted to inform the Applicant of this on several occasions on 19 and 20 August 2019. Unable to contact the Applicant by telephone, the Respondent sent correspondence to the Applicant on 20 August 2019 which stated:
“… at such time as you can provide a clearance confirming that you are fit to return to work, WorkPac will work with you to source an alternative assignment.”
The interesting part of this decision is that the Respondent draws a distinction between the termination of an assignment and termination of the Applicant’s employment. In his Honour’s opinion:
“It is clear on a reading of s 386 that a mere termination of assignment would not fall within the ambit of s 386”.
“Given the correspondence of the Respondent on 20 August 2019, it is clear that there is an ongoing relationship between the parties. There was no formal termination and there exists a promise of cooperation to find an alternative assignment, once the Applicant is in a suitable state to return to work. The offer of the Respondent to assist the Applicant in sourcing a new assignment was reaffirmed in correspondence dated 2 September 2019, which stated:
“WorkPac cannot source an alternate assignment for you whilst you are not fit for work. At such time as you are able to provide a clearance to return to fall duties, please don ‘t hesitate to contact the office for assistance sourcing a new opportunity.”
Case law
In Arcadia v Accenture Australia, Watson VP stated:
“An employment contract is formed by the offer and acceptance of a contract of service in which all of the essential ingredients of a valid contract are present. The contract must include consideration, the parties must have a continuing and mutual obligation to perform their respective sides of the bargain and there must be intention to create legal relations.
“In a typical labour hire situation, a tripartite arrangement is made whereby an agency enters into an agreement with a worker to hire out the services of the worker to a host. In general, the absence of any contract between the worker and the host will lead to a finding that the worker is not an employee of the host. Although the concept of joint employment has some recognition in US Labour Law, it has not been adopted by any Australian Court.”
His Honour’s view
“The above highlights the separation between the agency who employs the worker and the company who utilises the services of the worker. The tripartite arrangement present in this case clarifies that the Applicant was not an employee of [the client] and therefore was not terminated upon cessation of her assignment. The Applicant continues to have an ongoing relationship with the Respondent, highlighted by the offer of support to find new employment, once the Applicant was fit for work.
“Given that the Applicant is still an employee of the Respondent, I find that the application has no reasonable prospect of success”.
Concluding
DP Asbury in Ms Kim Star v WorkPac Pty Ltd T/A WorkPac Group [2018] FWC 4991 at [99] stated:
“The contractual relationship between a labour hire company and a host employer cannot be used to defeat the rights of a dismissed employee seeking a remedy for unfair dismissal. Labour hire companies cannot use such contractual relationships to abrogate their responsibilities to treat employees fairly…”
In this case:
“What is before me here is not a labour hire company abrogating their responsibilities. The Respondent has not sought to deny the Applicant employment – on the contrary, they have confirmed there will be future assignments when the Applicant is fit for work. The way forward here is not a claim for unfair dismissal, but rather, the Applicant focussing on improving their health, so that they can work with the Respondent to return to work”.
Commentary
Whilst being of probative value in the law of employment, the decision has a “bet each-way” putting labour-hire companies on notice that they must behave themselves.
