T10855
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TASMANIAN INDUSTRIAL COMMISSION Industrial Relations Act 1984 Helen Mary Dillon and S M International Pty Ltd trading as
Industrial dispute - application of Enterprise Agreement - management contract - administrative employee - Agreement found to apply - hours worked - whether overtime authorised - public holidays - Order REASONS FOR DECISION [1] On 21 May 2003, Helen Mary Dillon (the applicant) applied to the President, pursuant to Section 29(1A) of the Industrial Relations Act 1984, for a hearing before a Commissioner in respect of an industrial dispute with S M International Pty Ltd trading as City View Motel arising out of an alleged breach of an award or a registered agreement. [2] The matter was listed for a conciliation conference on 19 June 2003. Ms J Fitzgerald, of the Working Women's Centre Tasmania, appeared for the applicant. Ms L Swanston, solicitor, appeared for the respondent via audio-link. A further conciliation conference was held on 7 July 2003. Ms J Fitzgerald appeared for the applicant. Mr F Ireland, of Ireland Consulting Services Pty Ltd, with Mrs T Voss, appeared for the respondent. An attempt to resolve the matter by conciliation was unsuccessful and the matter was listed for a hearing on 5 and 6 August 2003. Ms J Fitzgerald appeared for the applicant. Mr J Bronstein, solicitor, sought and was granted leave to appear for the respondent, together with Mrs T Voss. Background [3] The respondent, Mrs Voss, in partnership with her husband, at all relevant times owned a motel, which traded as the City View Motel. [4] On 31 March 2002, the applicant, Mrs Dillon, commenced employment at the motel. Initially Mrs Dillon worked only on weekends. However shortly after commencement Mrs Dillon was offered substantially increased hours at the motel. This offer was accepted and Mrs Dillon resigned from her other position to work exclusively at the motel. The precise hours worked and employment status (casual or full-time?) under this arrangement is in dispute. Suffice to say that between 19 April and 17 September 2002, Mrs Dillon worked on average in excess of 38 hours per week. It would appear that Mrs Dillon's husband, Mr Ian Dillon, was employed on a casual basis as a gardener during this period. [5] Mr and Mrs Voss operate a number of businesses under the company S M International Pty Ltd, both within Tasmania and interstate. They are absent from the state for extended periods and this no doubt was a key driver in their decision to move to a staffing model centred around a live-in couple residing on the premises and sharing the workload. [6] In August 2002, Mrs Voss approached Mrs Dillon as to the latter's interest in such a role. Whilst there is considerable dispute as to the nature of any agreement reached, there can be no doubt that on or about 17 September 2002, Mr and Mrs Dillon took up residence in a unit on the motel premises. Individuals who had previously occupied positions of Day Manager and Night Manager ceased working at the motel about the same time or shortly thereafter. [7] This arrangement continued until 4 March 2003, at which time the motel was sold. There was a disagreement as to the quantum of the final payment to Mrs Dillon, which in turn led to the application currently before the Commission. [8] In summary, the applicant asserts that throughout her employment, and in particular, after she became resident on the property, she worked excessive amounts of overtime, for which she was not paid. The applicant seeks an amount of $22656.30 for overtime allegedly worked and not paid. In addition, the applicant seeks an amount of $1085.40 for public holidays worked for which no substitute days off in lieu were allowed. [9] The relevant industrial instrument is the S M International Enterprise Agreement 1999, registered pursuant to Part 1VA of the Act. [10] The respondent asserts that Mrs Dillon, in conjunction with her husband, were party to a bona fide management contract and, as such, the Enterprise Agreement had no application. [11] It naturally follows that the first question to be determined is whether or not the Enterprise Agreement has application. Evidence [12] Evidence was taken from the following witnesses:
[13] It is a matter of regret that this case was characterised by serious conflicts in important aspects of the evidence. The following are examples:
[14] I am unable to make a finding as to witness credit such as would allow me to prefer the evidence of one witness over another in the event of conflict. Where necessary, issues of conflict have been resolved on the balance of probabilities. Was Mrs Dillon Subject to the Enterprise Agreement? [15] The S M International Enterprise Agreement 199917 was in force at all material times. [16] Clause 2, Application, reads:
[17] Clause 5, Definitions, contains the following definition:
[18] It is this classification that Ms Fitzgerald contends covers the work of Mrs Dillon. [19] Mr Bronstein contends that Mrs Dillon was on a contract as a live-in manager to which the Enterprise Agreement does not apply. [20] Much of the evidence went to the nature of this contract and the nature of the duties performed by Mrs Dillon. I turn firstly to the question of the contract. [21] Mrs Voss approached Mrs Dillon concerning the live-in role in early August 2002. Initially Mrs Dillon declined the role, although it seems likely that further discussions took place at Mrs Voss' home on 16 August. Mrs Voss said she invited Mrs Dillon to put on paper her thoughts about the role, including the required remuneration. [22] On or about 28 August Mrs Dillon sent a fax to Mrs Voss in the following terms:18
[23] Given the terminology used, it seems likely that this fax was a response to the invitation issued by Mrs Voss on 16 August. [24] Shortly thereafter Mr and Mrs Voss decided to go to Queensland. Mrs Voss said:19
[25] The letter referred to by Mrs Voss was expressed as follows:20
[26] Note: It is common ground that Ian Dillon was to be paid $280pw. Thus the weekly salary for Mrs Dillon was $440. [27] Mrs Voss said that there was a document attached to this letter, which is reproduced below:21
[28] Both Mr and Mrs Dillon categorically denied ever seeing either of these documents whilst in the employ of Mrs Voss. [29] Mrs Voss' evidence was that she waited until after 4.00pm when the then Day Manager left for the day, telephoned Mrs Dillon to advise that the fax would be coming, and then faxed both documents. [30] According to an extract from Mrs Voss' Telstra account,22 Mrs Voss telephoned the motel at 4.39pm on 24 September, and then sent a fax at 4.41pm. A notation on the letter suggests that it was also posted on 25 September. [31] In closing submissions Ms Fitzgerald submitted that the document should be treated as "suspect", in that it was not produced until late in the proceedings, it is unsigned and the original was never produced. Whilst there is force in this submission, I am, on the balance of probabilities prepared to accept that the documents were sent in the manner suggested by Mrs Voss. [32] According to the record of hours worked, Mr and Mrs Dillon moved into the motel unit on 17 September. Thereafter Mrs Dillon was paid at the rate $440pw and Mr Dillon $280pw. Finding as to the Contract [33] As a consequence of a lengthy exchange between the Commission and Mrs Dillon,23 I am satisfied that Mrs Dillon was aware of the employment terms on offer prior to moving into the motel on a live-in basis. [34] The fact that Mrs Dillon performed this role for the next six months is evidence that she accepted these terms. [35] I therefore conclude that the essential elements for a valid contract, ie, offer, acceptance and consideration, were present. [36] I further conclude that, on the balance of probabilities, the terms of the contract were as set out in the documents dated 24 September 2002. I make this finding subject to the following provisos:
[37] I turn now to the nature of the duties performed by Mrs Dillon. [38] Both Mrs Dillon and Mr Dillon were adamant that they were not managers.24 I suspect however that this view was, in large measure, driven by their perception of what the case law might say about managers and award coverage. [39] There was a considerable amount of evidence as to the duties performed by Mrs Dillon. These duties were well summarised by Ms Fitzgerald in closing submissions:25
[40] Ms Fitzgerald submitted that these tasks could hardly be considered as managerial. [41] On the other hand, Mr Bronstein submitted that there were factors which pointed to a managerial role. These included the absence of the owner for extended periods of time; responsibility for the supervision of rosters for cleaning staff; overall supervision of the premises including cleaning and maintenance of the property; responsibility for guest comfort and contentment; input into the strategic development of the business; ordering of goods and supplies within limits. [42] In terms of perception, the following evidence is relevant:
[43] I am satisfied, on the evidence, that the following conclusions can be drawn:
[44] I am satisfied, on the evidence, that Mrs Voss performed the following tasks on an exclusive basis:
[45] I am also satisfied that Mrs Voss took an extremely close interest in the day-to-day running of the motel, as evidenced by the minutes of the staff meeting on 9 October 2002.32 [46] Ms Fitzgerald submitted that the rate paid to Mrs Dillon was little more than the introductory rate in the parent award - Hotels, Resorts, Hospitality and Motels Award (the Award), without the benefit of penalty rates which attach to the Award. This, she submitted, was hardly indicative of a person performing a management role. [47] Ms Fitzgerald relied on the judgement in San Remo (Southland) Pty Ltd v Farrell, in which Macken J said:33
[48] Mr Bronstein cited Kingmill (Australia) Pty Ltd v Marshall34 as authority for the proposition that the correct approach is a broad consideration of the nature of the occupation rather than a simple consideration of the specific duties undertaken by that position. Applying what Mr Bronstein described as a global test, leads to the conclusion that the position occupied by Mrs Dillon was that of a manager, and outside the provisions of the Enterprise Agreement. [49] Mr Bronstein drew support from the decision of Shelley C in Wyatt v Grassy Pastoral Co35 in which the Commissioner found that the duties performed went beyond that of a farm-hand and could more properly be described as a managerial function. Mr Bronstein said that there was a close parallel between the two cases in that the owners of the respective businesses were absent for extended periods of time. [50] Mr Bronstein referred to the judgement in Holt v Musketts Timber Sales Pty Ltd36 whereby Northrop J found that the manager of a timber mill was not subject to the Award in that certain tasks, which might otherwise be covered by the Award, were subsidiary to the principal occupation of manager, for which he had been engaged. Finding as to the Application of the Enterprise Agreement [51] I deal firstly with the appropriate designation for Mrs Dillon. [52] On the available evidence I have little doubt that Mrs Dillon presented to the outside world as the manager of the property. [53] Whilst much of the evidence is in contest, the minutes of the 9 October staff meeting make it quite clear that Mrs Voss considered Mrs Dillon to be the manager. [54] Having reached this conclusion, it does not automatically follow that the Enterprise Agreement does not apply to Mrs Dillon. In this context the authority of San Remo v Farrell is pertinent. That is, the mere designation of "Manager" is not conclusive of a person's occupation, nor does it of itself oust the operation of the Award. [55] On the evidence it is clear that very few of the functions performed by Mrs Dillon could be described as managerial. Indeed, tasks normally associated with management, eg hire and fire, purchasing, payment of wages and accounts, budgeting etc, were performed by Mrs Voss, virtually on an exclusive basis. [56] I agree with Ms Fitzgerald that Wyatt v Grassy Pastoral Co can be readily distinguished from the instant case. In that matter, Shelley C found:
[57] I am unable to reach the same conclusion in this matter. [58] I similarly distinguish Holt v Musketts. In that matter, Northrop J said:
[59] I conclude that work performed by Mrs Dillon fits comfortably within the definition of Administrative Employee, and it follows that the Enterprise Agreement governs the employment of Mrs Dillon. Any managerial tasks were very much subsidiary to her principal role. [60] There is one further point. The definition of Administrative Employee contains the expression:
[61] I can only conclude that this expression represents a clear intention of the parties to the Enterprise Agreement to cover the field. This would, on its face, include managerial functions, whether of a primary or subsidiary nature. [62] I note that Mrs Dillon took over the functions of the previous day and night managers, both of whom were subject to the Agreement. Indeed, the former Day Manager is a signatory to the Agreement and represented employees when the Agreement was first registered. It follows that the mere designation of "manager" does not of itself displace the Agreement. [63] An Enterprise Agreement is a creature of the parties. It was open to the parties to either vary the Agreement to exclude live-in managers, or alternatively, enter into a new agreement designed specifically to cover the live-in arrangements. Unwittingly or not, they did neither. [64] The application of the Enterprise Agreement does not in itself preclude a common law contract operating in tandem. However, such a contract must be read subject to s85 of the Act, which reads:
[65] In short, this means that a contract must not be less favourable than the registered Agreement. I now turn to that assessment. Employment Status [66] The applicant asserts that she was employed as a "casual employee" for the period 31 March to 15 September 2002. [67] Mrs Dillon was paid pro rata annual leave for the period 12 April 2002 to 4 March 2003. This, coupled with a regular pattern of work at all material times, points to a full-time weekly employee and I find accordingly. [68] There is insufficient evidence to determine conclusively the employment status prior to 12 April. However, little turns on this question as only a few shifts were involved. Appropriate Wage Rate [69] The Enterprise Agreement specifies an hourly rate for a full-time employee of $11.24ph. However, clause 6.3 states:
[70] This adjustment process has not been applied to the hourly rate and clearly should have been. [71] Ms Fitzgerald has calculated the adjustment in accordance with the formula and this calculation was not contested by the respondent. [72] I therefore determine that the appropriate hourly rate is:
Hours Worked [73] Mrs Dillon's claim is based on a record of hours worked which was recorded in an exercise book and kept in the motel kitchen. I accept that this record was maintained on a contemporaneous basis. [74] I also accept that, at least initially, the exercise book arrangement was required by Mrs Voss and applied to all staff. According to Mrs Voss this was subsequently changed to a time sheet record, as this was easier to fax. Mrs Voss states, and I accept, that she had not seen the exercise book since 2 May 2002. [75] Mrs Dillon said that the exercise book was readily accessible to Mrs Voss if she had concerns about the hours worked and I accept that this was so. [76] Against this, Mrs Voss said that Mrs Dillon did not send in time sheets like everyone else. [77] I also accept that, however misguided, Mrs Voss genuinely believed that a management contract was in place which displaced the Enterprise Agreement, and that the matter of hours worked was something for Mr and Mrs Dillon to work out between themselves. [78] Mrs Voss said that the exercise book was never brought to her attention37 and that she was surprised when the claim was made as she did not know that Mrs Dillon was working the hours claimed.38 [79] There is a chasm between the evidence of Mrs Dillon and Mrs Voss on the question of whether the hours and wages were raised as an issue. On the balance of probabilities I accept that the issue was raised in a general sense on at least one occasion prior to the sale of the property. However, again on the balance of probabilities, I very much doubt that the issue was raised in the context of:
[80] In other words, I doubt the matter was raised in the manner now being pursued before the Commission. [81] Given the unsatisfactory nature of the evidence, I am not prepared to accept the exercise book record as a definitive statement of the hours properly authorised to be worked. Given the unusual circumstances of the working arrangement, I believe that both Mrs Dillon and Mrs Voss shared a responsibility to manage the arrangement in a sensible and open manner. [82] I am prepared to accept the exercise book record as a base, from which certain adjustments will be made. [83] I note Ms Fitzgerald relied on the decision of Shelley C in Matthewson v The Egg Marketing Board39 in relation to the authorisation of overtime. The facts are, however, quite different. I do not accept that Mrs Voss authorised either in a general or specific manner the hours claimed in this application. Nor do I accept that, other than in a most general sense, Mrs Voss could have reasonably been aware that the hours claimed were actually worked. [84] I turn firstly to start times before 7.00am. This appears regularly on the hours record from October 2002 onwards. [85] The evidence points overwhelmingly to a conclusion that breakfast preparations took approximately 30 minutes. Indeed, Mrs Dillon commenced at 7.00am for the first six months to perform this very function. The former Night Manager, Mrs Cartledge, confirmed this practice.40 [86] It may well be that Mrs Dillon performed other tasks prior to 7.00am. However, if this was so, it was a matter of choice on her part, rather than a requirement. [87] I propose to adjust the record to remove any claimed hours prior to 7.00am. This will reduce the hours claimed by 121.5 hours. [88] It is common ground that motel reception was to remain open until 9.00pm. According to the record, Mrs Dillon worked beyond 9.00pm on numerous occasions, until as late as 11.00pm. It would seem that much of this work was computer based as Mrs Dillon encountered a glare problem during the day. It strikes me that there are infinitely better ways of solving a computer glare problem. [89] I accept that on occasions guests checked-in after 9.00pm. I also acknowledge Mrs Voss' evidence as to alternative arrangements available for late check-ins. There was also Mr Dillon, who could, and indeed more often than not did, attend to late check-ins. [90] I conclude that, to the extent that Mrs Dillon worked after 9.00pm, it was a matter of choice rather than a requirement. [91] I propose to deduct any hours claimed after 9.00pm. This will further reduce the hours claimed by 100 hours. [92] The record does not make any allowance for meal breaks. Mr Ian Dillon said:41
[93] Mrs Dillon's evidence was:42
[94] And later:43
[95] I do not accept that Mrs Dillon was precluded from taking meal breaks. In the period April to September 2002 the then Day Manager could have relieved her. Thereafter she could have arranged for Mr Ian Dillon to provide cover during breaks. This may not have suited her convenience, but again, that is matter of choice. [96] For the period 31 March to 20 September 2002 I propose to deduct 30 minutes for each shift worked of more than 6 hours. For the period 21 September 2002 to 4 March 2003, I propose to deduct two 30 minute breaks for shifts finishing after 6.00pm, and one 30 minute break for shifts finishing at or before 6.00pm. [97] The combined effect of the above is to reduce the claimed hours by a further 218 hours. [98] There is one further aspect. I am satisfied on the evidence that Mrs Voss made it clear to Mrs Dillon that she was available to provide relief should Mrs Dillon require time off. It is less clear whether Mrs Dillon had discretion to call in other staff to provide relief. [99] I am however satisfied that Mrs Dillon, for her own reasons, did not fully avail herself of the opportunities available for additional time off. [100] I propose to make a further deduction of 60 hours to compensate for this. Whilst the figure is entirely arbitrary, in the interests of fairness it is appropriate to make this further modest adjustment to the claim. Public Holidays [101] Clause 11.2 of the Enterprise Agreement reads:
[102] The applicant claims that she worked on six public holidays and did not receive a substitute day in lieu. [103] I accept that Mrs Dillon was entitled to a substitute day, but I do not agree with Ms Fitzgerald's submission that the substitute day should include an overtime component. [104] An adjustment will be made to allow the substitute days on the basis of 7.6 hours per day. Calculation [105] Details of the revised calculation are shown in Appendix 1. Given the complexity of the calculations, leave is reserved to the parties to seek a re-opening of the matter if an error/s is detected. Such leave will remain open for a period of 21 days, and is limited to arithmetic calculations, as distinct from the substance of this decision. ORDER Pursuant to Section 31 of the Industrial Relations Act 1984, I hereby order that S M International Pty Ltd trading as City View Motel, pay to Helen Mary Dillon, 23 Kandara Court, Campania, Tasmania 7026, an amount of fifteen thousand one hundred and twenty eight dollars and sixty cents ($15128.60), such payment to be made not later than 5.00pm on Wednesday 24 September 2003.
Tim Abey Appearances: Date and Place of Hearing: Appendix 1 1. Relevant wage rate From March 2002 to 14 December 2002 $12.14ph 2. Period 30/3/02 to 20/9/02 Total hours claimed 1032.75 hrs 3. Period 21/9/02 to 13/12/02 Total hours claimed 1194.25 4. Period 14/12/02 to 4/03/03 Total hours claimed 1193.75 5. Total shortfall for period 31/3/02 to 4/03/03 $15300.30 Less: 6 Public Holidays 1 holiday @7.6 hours @ $12.14ph $92.30 7. Total amount due $15128.60
1 Exhibit A7 |