T10438
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TASMANIAN INDUSTRIAL COMMISSION Industrial Relations Act 1984 The Australian Workers' Union, Tasmania Branch and Barminco Pty Ltd
Industrial dispute - entitlement to long service leave - pro rata entitlement on termination of employment - transmission of business - whether continuous service - order issued REASONS FOR DECISION [1] On 16 September 2002, The Australian Workers' Union, Tasmania Branch, (the applicant), applied to the President, pursuant to s.29(1) of the Industrial Relations Act 1984, for a hearing before a Commissioner in respect of an industrial dispute with Barminco Pty Ltd arising out of the failure by the company to pay pro rata long service leave to Mr L Baldock. [2] The matter was set down for a hearing on Wednesday 16 October 2002 at 10.30 am. On that occasion the matter proceeded by way of a conference. There were two further hearing days: Monday 4 November 2002 at the Commonwealth Law Courts, 29-41 Davey Street, Hobart, and Monday 16 December 2002 at the Magistrates Court, Sticht Street, Queenstown. [3] Mr Robert Flanagan, together with Mr Ian Wakefield, appeared for the applicant union, and Mr Bill FitzGerald of the Australian Mines and Metals Association Inc. appeared for the respondent employer, together with Mr Simon Fitzgerald from Barminco Pty Ltd. [4] This application concerns a claim for an entitlement to pro rata long service leave, pursuant to the provisions of the Long Service Leave Act 1976 [the Act]. Background [5] The background, as established through the largely uncontested facts, is as follows: [6] Mr Leslie Royce Baldock was employed as an underground miner at the Mt Lyell Copper Mine in Queenstown from 6 February 1996 until he was made redundant on 2 January 2001. [7] During the period of his employment there were some changes in respect of his employers. From commencement until 30 July 1999 his employer was National Mine Management Pty Ltd [NMM]. On 1 July 1999 National Mine Management Pty Ltd changed its name to Macmahon Underground Pty Ltd [Macmahon]. This was a change in name only and not a change in legal entity. His employment with Macmahon continued until 29 September 2000, when it was terminated as a result of Macmahon losing the contract. Mr Baldock then commenced employment with the new contractor, Barminco Pty Ltd [Barminco], on 1 October 2000 and continued working for them until 2 January 2002 when he, along with a number of other employees, was made redundant. [8] At or about the time of his termination, Mr Baldock made a claim to the company for the payment of pro rata long service leave. The company did not meet the claim for two reasons: one, the existence of another long service leave dispute concerning the company which was before the Tasmanian Industrial Commission and which had not yet been determined, and, two, the fact that the company required further documentation from Mr Baldock by way of proof of continuous service on site at Mt Lyell. The Evidence [9] Mr Leslie Baldock gave evidence for the applicant, and, for the company, evidence was given by Mr Simon Fitzgerald, Human Resources Manager. [10] On the first day of hearing (16 October 2002) Mr Baldock was not available to give evidence. Mr Flanagan, for the union, presented as evidence a series of group certificates, together with a written statement from Mr Baldock which had been witnessed by a Justice of the Peace and which said:
The group certificates showed that Mr Baldock worked for NMM from:
for Macmahon from:
and for Barminco from:
[11] The matter was adjourned after the first day of hearing on 4 November 2002 in order to enable Mr Baldock to give direct evidence and be cross examined. On the second hearing day the above employment details were confirmed by Mr Baldock in his oral evidence. None of the dates were challenged by the respondent. [12] Mr Baldock said that he worked underground, and that he was employed continuously at the Mt Lyell site. He said that he basically did the same work throughout the entire period of his employment, which was supervisor/leading hand work. [13] When cross-examined, Mr Baldock said that he had gone to another site at Henty for about three weeks. The only other break had been when his "young bloke" had an accident, but that was covered by leave. [14] Tendered as evidence was a letter from Barminco to Mr Baldock, dated 2 January 2002, in which he was advised that he was to be made redundant, effective immediately2. Mr Baldock confirmed that he received the redundancy payment outlined in that correspondence. He said that he had asked about his long service leave on the day of his dismissal. [15] Mr Simon Fitzgerald's evidence was that he was familiar with Mr Baldock's claim for long service leave, which had first been requested following the redundancies at the Mt Lyell mine. He said that a letter had been sent requesting that Mr Baldock provide documentation by way of group certificates. They were all sent, but the one for the first part of the tax year of 2000/2001 was missing. He said that the missing certificate could have held some significance because it was for a period of three months and under the Act that could have meant that they had no liability. He said that the missing group certificate had only been sent to him a few days before the previous day's hearing in Hobart. [16] Mr Fitzgerald said that [at the time of the claim] there were a number of questions concerning the whole matter, including the Elkin matter [another long service leave dispute involving Barminco] which had not yet been determined. [17] The claim continued to be opposed, he said, because the document provided by Mr Baldock [Exhibit A1] did not appear to be a formal statutory declaration. [18] In answer to a question as to whether the company was still maintaining opposition to the claim, Mr Fitzgerald said:
Submissions For the applicant [19] Mr Flanagan submitted that the fundamental question to be determined is whether there was continuity of service at the site. [20] It was recognised as a matter of fact, he said, that on 1 July 1999 National Mine Management changed its name to Macmahon Underground. On 29 September 2000, the date that Mr Baldock was dismissed by Macmahon, he had four years seven months and 27 days service with them. [21] Mr Flanagan referred to Scott Andrew Elkin and Barminco Pty Ltd, a decision of Abey C in matter T9906 of 2002, concerning a long service leave dispute. He said that the issue of the transmission [of business] between Macmahon Underground and Barminco had been dealt with in that decision. There was a clear recognition and finding by Commissioner Abey that in fact there was a transmission for the purposes of the Act, such that the employment was found to be continuous. [22] In particular, Mr Flanagan referred to paragraph 47 of the decision, which says:
[23] Mr Flanagan said that he relied upon the reasoning in that decision, in which the respondent employer was Barminco, and which had not been appealed. [24] Mr Baldock did, in fact, have less than five years' service with Macmahon at Mt Lyell; he continued his employment in the service of Barminco; and an entitlement did in fact crystallise at the point when Barminco decided to terminate Mr Baldock's employment. [25] Mr Flanagan said that the Act draws a distinction between mining employees and other employees, and, at section 2, it defines a mining employee as an employee who is employed in, at or about a metalliferous mine. There can be no argument that Mr Lyell copper mine is not a metalliferous mine. [26] Section 8A(2)(b) defines the quantum of long service leave, based on a pro rata amount based on the proportion that Mr Baldock's service bears to 13 weeks over a period of 10 years. [27] Section 8A(3)(d) is of relevance in that it identifies that a person is entitled to pro rata long service leave if his employment is terminated by his employer for any other reason than the serious and wilful misconduct of the employee. [28] Section 2(2) of the Act reads:
[29] There is no argument, he said, that Barminco and Macmahon Underground are in the business of mining as mining contractors. [30] The interpretation of section 2(2) had been dealt with in a decision of Gozzi C in T1807 of 1989 [Lynette Anne Marney and Croucher Pty Ltd]. In that decision the Commissioner found:
[31] Commissioner Gozzi found that the fact that Mrs Marney was terminated by successive contractors does not change the fact that she continued on in or about that place (Anglesea Barracks) in the business of some other employer. [32] Mr Flanagan submitted that the present case was identical. The evidence of Mr Baldock is that he was continuously employed at the Mt Lyell site during the periods identified in Exhibit A1 [the group certificates]. As a consequence, Mr Baldock is entitled to pro rata long service leave. For the respondent [33] Mr FitzGerald said that the last group certificate had not been produced until very much the last moment. Despite the evidence that had now been put forward, the claim was still opposed. [34] He submitted that the statement originally produced by Mr Baldock was not in a proper form. He said that despite the evidence given by Mr Baldock on the second day, the respondent was still not satisfied that there was proof of continuous service on site. It was simply on that basis that the claim was opposed. [35] In respect of the decision in Scott Andrew Elkin and Barmino, Commissioner Abey had made a gratuitous statement about liabilities in respect of other employees. That matter is not before the Commission now and is not something that should be relied upon in granting or not granting the current claim, he said. FINDINGS Continuous Service [36] Both parties submitted that the issue to be determined was whether or not Mr Baldock had been continuously employed at the Mt Lyell site. If he had been continuously employed at the site, then, pursuant to s8A(2)(b) he would have an entitlement to a payment for pro rata long service leave at the time of the termination of his employment on 2 January 2002. [37] In terms of determining what constitutes "continuous service", the relevant section is 2(2) of the Act, which is set out in full earlier in this decision [38] I adopt and accept the principles and reasoning as set out in the case of Lynette Anne Marney and Croucher Pty Ltd, where Gozzi C, in essence, found that, if an employee remains on the same site performing the same work during a period where there has been a change or changes of ownership of the business then, for the purposes of the Long Service Leave Act 1976, there is a deemed transmission of business from one employer to the other. Provided that there has not been a break of more than two months between finishing with one employer and starting with another, then the employee's service with previous employer/s is counted for the purposes of long service leave. In the case of Marney and Croucher it was clearly established that the transmission of business provisions of section 2(2) apply when a contract changes hands, in that case, a cleaning contract. [39] In my view, in Mr Baldock's case, the evidence is clear in respect of the continuity of service at the Mt Lyell site. The group certificates from 1996 to 2002 show that he was employed by two different employers (albeit that one had a change of name), both of whom were contractors at the Mr Lyell site. His employment with these two employers covered the whole of the period between 6 February 1996 and 2 January 2002. Mr Baldock's oral evidence was that all of his service had been at the Mt Lyell site (excepting for a short period which did not, under the terms of the Act, break service). His evidence was not challenged. The respondent brought no evidence to show that continuity of service at the Mt Lyell site had, at any stage, been broken. [40] I find that Mr Baldock was continuously employed at the Mt Lyell site for a period of 5 years 10 months and three weeks. Pro rata Entitlement [41] Section 8A(2)(b) of the Act reads:
[42] Subsection (3) says that subsection 2(b) applies to:
[43] It was common ground that Mr Baldock's employment was terminated because his position was made redundant, and there was no question that he was dismissed for serious and wilful misconduct. [44] During the time of Mr Baldock's employment at the Mt Lyell site there was a change of contractor, from Macmahon Underground Mining Pty Ltd (previously called National Mine Management Pty Ltd) to Barminco Pty Ltd. Macmahon terminated Mr Baldock's employment on 29 September 2000. Barminco employed Mr Baldock on 1 October 2000. As at the date of the termination of his employment with Macmahon, Mr Baldock had less than five years' service on site. This is of relevance in the light of Abey C's decision in the case of Scott Andrew Elkin v Barminco. In that case the Commissioner found that, under the terms of the Act, there had been a transmission of business from Macmahon to Barminco. He found that, in circumstances where an employee has accrued an entitlement to pro rata long service leave at the time of transmission of business, that long service leave obligation should be met by the transmittor (ie, Macmahon). Where an entitlement to pro rata long service leave has not yet accrued as at the time of the transmission of business, then the period of employment with the transmittee (ie, Barminco) shall be deemed to include the period of employment with the transmittor. [This, of course, is contingent upon the employee being employed by the transmittee before the expiration of two months]. I agree with the Commissioner's findings. [45] In the case of Mr Baldock, at the time of the transmission of business he had not yet accrued an entitlement to pro rata long service leave. This is because he had less than five years' service on site. Therefore, for the purposes of long service leave, all of the period of his employment on site becomes the responsibility of Barminco. I note that Barminco did not appeal the decision in the Elkin case, in which case the outcome was to the benefit of Barminco. Mr Elkin had an accrued entitlement to pro rata long service leave at the time of the transmission of business, therefore it became the responsibility of Macmahon to make a pro rata payment to Mr Elkin. In the current case, using the same reasoning, the outcome is that it is the responsibility of Barminco to make a payment to Mr Baldock. [46] I find that Barminco Pty Ltd, under the terms of the Act, is obligated to make a payment for pro rata long service leave to Mr Baldock on the basis of continuous service of five years and 10 months and three weeks. ORDER Pursuant to Section 31[1] of the Industrial Relations Act 1984 , I hereby Order, in full and final settlement of the dispute stated in application T10438 of 2002 that Barminco Pty Ltd, Mt Lyell, Locked Bag 3, Queenstown, Tasmania 7467 pay to Mr Leslie Royce Baldock of 14 Raglan Street, Somerset, Tasmania 7322 the sum of Eleven Thousand, One Hundred and Thirty One Dollars and Fifty Cents being for pro rata long service leave entitlement. This amount shall be paid no later than the close of business on Thursday 13 February 2003.
P C Shelley Appearances: Date and place of hearing: |