This matter concerns an appeal pursuant to Section 14 of the Long Service Leave Act, 1976 (the Act).

More particularly the Kingborough Nursing Home Pty Ltd is aggrieved by the determination made by a Commissioner pursuant to Section 13, in matter T No 1840 of 1989, on 9 August 1989.

In that determination Commissioner Watling made a finding in favour of a former employee of the Kingborough Nursing Home and made an Order requiring payment to Mrs Lynette May Brennan of an amount of $2,508.70 in full settlement of her long service leave entitlement.

Mrs Brennan commenced her service as a Nursing Assistant with Sunnyside Nursing Home on 20 October 1972. At that time the employer was a Mr and Mrs Verdouw.

Mrs Brennan continued her employment when some time later the ownership of the Home was transferred from the Verdouws to a Mr Hall (Ebony Bay Pty Ltd).

The Home was finally purchased by the appellant, Kingborough Nursing Home Pty Ltd from Ebony Bay Pty Ltd on 15 April 1988, although employment records indicate that Kingborough Nursing Home Pty Ltd actually employed Mrs Brennan from 13 to 17 April 1988. Regardless of the precise number of days concerned it is a matter of fact that upon purchasing Sunnyside Nursing Home, Kingborough Nursing Home Pty Ltd employed staff previously employed by Ebony Bay Pty Ltd., including Mrs Brennan.

Whilst Kingborough Nursing Home Pty Ltd indicated that they were prepared to pay the proportionate amount of Mrs Brennan's claim based upon the brief length of service with them, they have maintained that the remainder should be paid by the previous owners of Sunnyside Nursing Home.

According to the evidence, at the time that the business was purchased and moved to Kingborough, accrued long service leave entitlements from the previous employers were paid into a trust account for a number of employees who had achieved either a pro-rata entitlement or a full entitlement. However Mrs Brennan was not on the list, and as a result of this oversight the owners of Kingborough Nursing Home face a substantial cost which was not taken into account at the time of sale.

The first ground of appeal in the matter before us is a follows:

"(i) The Employee, Mrs Brennan, commenced her service on the 20^th October 1972 and had accrued 15 years continuous service on the 20^th October 1987. On the 20^th October 1987 her Employer was the Company, Ebony Bay Pty Ltd. On the 15^th April 1988 Kingborough Nursing Home Pty Ltd purchased the Sunnyside Nursing Home Pty Ltd owned by Ebony Bay Pty Ltd, and employed staff previously employed by Ebony Bay Pty Ltd. Between the 20^th October 1987 and the 15^th April 1988 the Company, Ebony Bay Pty Ltd had practicable opportunities to grant Mrs Brennan long service leave of 13 weeks and failed to do so. At the time that Kingborough Nursing Home Pty Ltd took over from Ebony Bay Pty Ltd., Ebony Bay Pty Ltd accordingly already committed a breach of the Long Service Leave Act and were liable to prosecution and liable to immediately give the Employee her long service leave. There is no provision in the Long Service Leave Act which provides that future Employers must pay for past dishonoured long service leave commitments of a former Employer. Such a provision is not to be implied into the Long Service Leave Act because it is a penal statute as it carried penalties for breaches and such statutes are to be interpreted strictly according to the Common Law principles of statutory interpretation."

In considering this question it is necessary to make an examination of the Long Service Leave Act 1976 which reveals in 7A that:

"Subject to this Act, an employee is entitled to long service leave on ordinary pay in respect of continuous employment with an employer."

and 8(2) provides that:

"8(2) [Entitlement] Subject to subsection (4), the period of long service leave to which an employee is entitled under this Act is -

(a) on the completion by an employee of at least 15 years' continuous employment with his employer;

(i) 13 weeks' long service leave in respect of the first 15 years' continuous employment with his employer;

(ii) 8 2/3 weeks' long service leave in respect of each additional 10 years' continuous employment with his employer; and

(iii) on the termination of his employment, an additional period of long service leave in respect of the number of years' continuous employment with his employer since the last accrual of entitlement to long service leave under the foregoing provisions of this paragraph, such a period of long service leave as bears the same proportion to 13 weeks as that number of years bears to 15 years; or

(b) in the case of an employee to whom this paragraph applies by virtue of subsection (3) who has completed 7 years' but has not completed 15 years' continuous employment with his employer such period of long service leave as bears the same proportion to 13 weeks as the total period of the employee's continuous employment with his employer bears to 15 years."

From this we conclude that, Mrs Brennan could have been granted long service leave by her previous employer at any suitable time subsequent to her attaining 15 years continuous service.

However at the same time we do not agree that, prima facie there is any evidence that the previous employer committed a breach of the Act and was liable for prosecution as claimed by the appellant in this matter.

We draw attention to Section 12 which details "How and When Long Service Leave Shall Be Taken", and provides that:

"SECTION 12 HOW AND WHEN LONG SERVICE LEAVE SHALL BE TAKEN

12(1) [Taking of Leave] Subject to this Act, when an employee becomes entitled to long service leave under this Act, that leave shall be granted by the employer as soon as practicable after the employee becomes entitled to it, having regard to the needs of the employer's establishment, but -

(a) the taking of the leave may be postponed to such date as is agreed upon between the employer and the employee or, in default of agreement, as the Secretary, having regard to the problems involved, directs, but no direction by the Secretary under this paragraph shall require the long service leave to commence before the expiration of 6 months after the date of the direction: and

(b) in no case is any entitlement to long service leave lost or in any way affected by the foregoing provisions of this subsection or by any failure or refusal of the employer to grant the leave."

Clearly therefore the granting of leave may be postponed, but in any case the employee's entitlement to long service leave cannot be lost or in any way affected by the failure or refusal of the employer to grant long service leave.

We believe also that the provisions of the Act need to be read as a whole. And in this regard the provisions of 5(4) are relevant because they put it beyond doubt that continuity of employment is not broken by reason of a transmission; and that employment with a transmittee is deemed to include a period of employment with the transmittor. The provision is as follows -

"Section 5(4) [Transmission of Business] Where a business is, whether before or after the commencement of this Act, transmitted from an employer (in this subsection referred to as "the transmittor") to another employer (in this subsection referred to as "the transmittee") and a person who at the time of transmission was an employee of the transmittor in that business becomes an employee of the transmittee -

(a) the continuity of the employment of that employee shall be deemed not to have been broken by reason of the transmission; and

(b) the period of employment of the employee with the transmittee shall be deemed to include the period of his employment, and any period deemed to be a period of his employment, with the transmittor."

In our view it is clear that the Act allows any employee to claim long service leave after completing 15 years continuous service. But the failure or refusal of the employer to grant the leave does not cause a loss of entitlement or give rise to any other adverse affect which could result in a loss of accrued long service leave.

Furthermore in this case there is no evidence of a claim being made or refused by any employer or Mrs Brennan prior to Kingborough Nursing Home which may have created a breach of the Act.

It is also our view the Act provides that where the transmission of business occurs then, regardless of the length of service with any employer, or even a series of employers, engaged in the same business, the whole period of employment is deemed to have been with the transmittee.

For these reasons we reject the first ground of appeal.

In the second ground it was submitted that: -

"(ii) The words "period of employment" in Section 5(4) of the Act are to be interpreted strictly also. Applying the strict interpretation the period of employment of the Employee for the purposes of the Act expired at the time of her entitlement to long service leave accrued, namely on the 20^th October 1987. A new period of employment for the purposes of the Act commenced after the 20^th October 1987. However the Employee resigned in 1988 and so there was no entitlement to pro-rata long service leave in respect of the period of employment applying to Kingborough Nursing Home Pty Ltd under Section 5(4), namely October 1987 to April 1988."

We disagree with the premise that the words "period of employment" in Section 5(4) are to be interpreted so narrowly as to categorise the first period of employment for the purposes of the Act as having expired as at 20 October 1987, and a new period for the purpose of the Act commencing after 20 October 1987.

Such a proposition is contrary to the provisions of the Act as a whole and to the express provisions of Section 8(2)(iii) which provides simply that, on the termination of employment "since the last accrual of entitlement" there shall be a further pro-rata entitlement. An employee therefore does not have to necessarily otherwise qualify such as by having to achieve a further 10 years continuous service or qualify only by virtue of meeting the requirements of Section 8(3) of the Act which provides: -

"8(3) [Applications of Subsection (2)(b)]
Subsection (2)(b) applies to -

(a) an employee who attains the age of retirement;

(b) an employee whose employment is terminated on account of illness of such a nature as to justify the termination of that employment;

(c) an employee who terminates his employment on account of incapacity or domestic or other pressing necessity of such a nature as to justify the termination of that employment; and

(d) an employee whose employment is terminated by his employer for any reason other than the serious and wilful misconduct of the employee."

And that Section also needs to be considered in conjunction with Section 5(4).

Ground (iii) of appeal is as follows: -

"(iii) The term "business" in Section 5(4) of the Act does not apply to Corporations. Business is defined in Section 2 as including any trade, process, profession or occupation and any part thereof. In general terms the word business is not a term used to describe a Corporation. Section 5(5) of the Act applies to Corporations. However there is only deemed to be continuity of service where the Corporation accepting the transfer of employment is associated with the original Corporation. There is no association between Kingborough Nursing Home Pty Ltd and Ebony Bay Pty Ltd."

This was not a matter raised in proceedings before the Commissioner in the course of the original hearing and no application was made to us nor was any case made out to permit new evidence or other matters to be freshly admitted for consideration by us.

We did nevertheless attempt to ascertain as a question of fact as to how Kingborough Nursing Home could not be construed as conducting a "business" as referred to in 5(4) of the Act. However nothing was put to us to attempt to verify such an assertion as is contained in that particular ground of appeal.

Accordingly we have decided to dismiss this ground of appeal also.

The final ground of appeal is that: -

"(iv) The Commissioner erred in Law in not dismissing the Employee's claim against Kingborough Nursing Home Pty Ltd for long service leave."

We are required to determine the matter presently before us according to the requirements of the Act. And of particular relevance is Section 14(2) which provides simply that: -

"14(2) [As prescribed] An appeal under this section shall be instituted, heard and determined as prescribed."

Our duty according to the statute and regulation 4(5) is: -

"4(5) [Duty of Full Bench] On the hearing of an appeal, a Full Bench shall act according to equity, good conscience, and the merits of the matter without regard to technicalities or legal forms, and may direct itself by the best evidence it can procure, whether that evidence would be admissible in a court or not."

We have concluded that the final appeal ground, and indeed the grounds as a whole, do not fit comfortably with the requirements of Regulation 4(5).

For all of these reasons the appeal is dismissed.