TASMANIAN INDUSTRIAL COMMISSION

Industrial Relations Act 1984
s.15 referral of a Long Service Leave dispute

Mrs R Warbrooke

and

Hodge Enterprises Pty Ltd
trading as Lewisham Tavern
(T.3400 of 1991)

Long Service Leave Dispute

REASONS FOR DECISION

This matter concerns a reference of a dispute pursuant to Section 13 of the Long Service Leave Act 1976.

The parties concerned are Hodge Enterprises Pty Ltd, trading as Lewisham Tavern, and Mrs Warbrooke.

The claim was that the employee concerned was continuously employed at Lewisham Tavern since early 1980 as a waitress/kitchen hand until she was dismissed for reasons other than for serious and wilful misconduct on 27 August 1990.

Since being first engaged Mrs Warbrooke was employed by three separate employers at the same premises, with the claim residing against Hodge Enterprises as the last employer, consistent with Section 5(4) of the Act.

The matter was first referred to the Secretary for Labour who caused an investigation to be carried out into the circumstances of the dispute and, when the matter remained unresolved, submitted a report of those findings to the President.

Section 13(1) of the Act provides as follows:

"13(1) Referral to Secretary A Dispute:

(a) As to whether or when an employee is or has become entitled to long service leave or payment in lieu thereof, or a deceased employee's personal representatives are or have become entitled to payment in lieu of long service leave; or

(b) with respect to the rate of ordinary pay of an employee for the purpose of this Act

shall be referred to the Secretary who shall investigate the circumstances of the dispute and submit a report of his findings to the President of the Commission."

On 20 August 1991 the Senior Industrial Officer, Department of Employment, Industrial Relations and Training, Industry Services Division (DEIRT) referred the dispute to the President in accordance with Section 13(1) of the Act and advised that, inter alia:

• The Long Service Leave dispute was referred to the Department on 26 October 1990.

• Mrs Warbrooke stated she was continuously employed at the Lewisham Tavern from November 1979 until she was dismissed on 17 September 1990. She was not paid for pro rata long service leave.

• Subsequent investigation disclosed that her termination date was 27 August 1990, however her commencement date was unclear, but evidence obtained indicated it to have probably been in early 1980.

The Commission was also supplied with:

1. DEIRT report.

2. Correspondence from employee to employer.

3. Correspondence from the employer's solicitors to the employee.

4. Copies of four statutory declarations.

5. The "record of complaint".

At the hearing of the dispute on 10 October 1991 both the employer (Mr Hodge) and the employee (Mrs Warbrooke) were present but neither had any previous training or experience in the prosecution or defence of a case before the Commission, nor were they represented by an agent.

Thus the Commission was largely dependent upon DEIRT's presentation of an accurate factual report of relevant material necessary to determine whether or not an entitlement to long service leave could be established beyond reasonable doubt.

Industrial Officer Millhouse who had carried out the investigation presented his report to the hearing. In his report Mr Millhouse said that according to the information provided to him Mrs Warbrooke was employed as a waitress/kitchenhand at the Tavern on a casual basis. She was contacted by telephone on 17 September 1990 by the cook who told her that her employment was terminated as she was being replaced by a person for whom the employer was to receive a subsidy.

Mrs Warbrooke discussed with her employer (Mr Ken Hodge) the matter of her pro rata long service leave. Mr Hodge told her she would only get 6 months of entitlement, i.e. the period of employment with himself.

Acting on DEIRT's advice Mrs Warbrooke wrote to Mr Hodge requesting payment of pro rata long service leave.

In her letter to Mr Ken Hodge dated 3 October 1990, Mrs Warbrooke stated as follows:

"In reference to my recent termination of employment, I wish to advise that I have since been in contact with the Department of Labour and Industry. Due to my length of service with the hotel and the reasons for my termination, I am entitled to receive pro-rata long service leave to cover my eight years of service.

If I have not received your cheque in settlement of the above within the next ten days I will refer the matter back to the Department of Labour and Industry to enable them to take the appropriate action in order to obtain monies owing to me."

Industrial Officer Millhouse then went on to report that:

Mr Hodge referred the letter to his solicitors, Ogilvie McKenna. Mr R C Smith from that office wrote to Mrs Warbrooke requesting proof of her long service leave entitlement in the form of group certificates etc.

He said that again on the advice of DEIRT Mrs Warbrooke did not respond to the letter as "the onus of proof is not on the employee".

He reported that the exact date of commencement of Mrs Warbrooke's employment is unclear although Statutory Declarations given by former employees at the Tavern confirm the year as 1980.

Officer Millhouse said that although Mrs Warbrooke cannot recall the exact date she commenced work she is clear that it was early 1980. Her recollection of the time is based on the birth of one of her children just prior to commencement.

Officer Millhouse said that as the records required to be kept by the Act have not been passed on by her former employers it has not been possible to ascertain the exact starting date. Attempts to get this information from the employer at the time have been fruitless.

The problem has been compounded by the fact that it is possible a "cash in hand" situation existed around this time and therefore an actual record may not exist. The employee should not be disadvantaged by this situation.

For the reasons outlined 1 January 1980 has been used by DEIRT as a starting date for calculation purposes.

Turning to that part of his investigation based upon his interview with the employer Officer Millhouse reported that Mr Ken Hodge was the employer of Mrs Warbrooke at the time her employment was terminated. She had been employed by Mr Hodge since 26 February 1990. She had previously been employed by Mr Bruce Appleby in 1989 and Mr Eric Upton from 1980 to 1989 at the same establishment.

Mr Hodge advised Officer Millhouse that the cook at the Tavern, Mr Bob Kirkwood, was responsible for the kitchen staff. Mrs Warbrooke and other staff had been asked to work full time but Mrs Warbrooke declined, as she preferred to work weekends only. As a result her employment had been terminated and she was replaced by a full time employee for which a subsidy was paid.

Mr Hodge told Officer Millhouse that he was unaware that he was responsible for the total payment of long service leave. It was explained to him that the provisions of Clause 5 (4)(a) and (b) of the Act have application in this instance.

Mr Hodge was said to have agreed that in principle an entitlement exists. His reason for non-payment to date is because the employers of Mrs Warbrooke prior to himself have not contributed to the long service leave payment. He would also wish to sight some documentary evidence to confirm the original starting date.

Officer Millhouse said that his calculation of possible entitlement is as follows:

In summarising the result of his investigation Officer Millhouse said that based on the details given by both the employer and the employee Mrs Warbrooke has an entitlement to pro-rata long service leave under the provisions of the Act.

He said that the facts in relation to the reason for Mrs Warbrooke's termination of employment are not in dispute and therefore satisfy the requirements of Clause 8(3)(d).

He alleged that there is sufficient evidence - in the form of Statutory Declarations from co-workers at the time - to confirm Mrs Warbrooke's contention that she commenced employment in 1980.

And finally Officer Millhouse said the only reason for the non-payment by Mr Hodge would seem to be a lack of knowledge of the requirements to do so under the Act and his desire to sight documentation to confirm the commencement date in order to pursue the other two employers for their share of the payment.

Sworn evidence was given by Mrs Warbrooke to effect that:

1. She cannot recall the date she commenced employment at Lewisham Tavern but to the best of her recollection it was early 1980. Taxation records show that she was employed at such establishment in 1983, but earlier records cannot be obtained.

2. In her first year of employment Mrs Warbrooke ceased work when about 3 or 4 months pregnant and did not resume work until this child was about 3 months old.

3. A further absence occurred about 5 or 6 years ago when Mrs Warbrooke simply "took a break from work". The duration of this period was about 6 months.

Four statutory declarations made by virtue of Section 132 of the Evidence Act 1910 were put forward as part of the evidence as to the time Mrs Warbrooke first commenced employment at Lewisham Tavern. The text of each of these declarations is as follows:

"A"

On returning from Queensland in March 1981 I was re-employed at the Lewisham Tavern as a barman.

Although I can't recall the exact date Ruth Warbrook was first employed it seemed as though she was always working there during the period of my employment up to when she left in 1990".

"B"

I commenced work on 31 December 1981 at the Lewisham Tavern. I remember the date as it was New Years Eve and I worked there for a full year and my son was born the following year.

Although Ruth Warbrooke was not working there at the time I commenced I believe she was employed prior to 31 December 1981."

"C"

When I commenced work at the Lewisham Tavern in late 1980 Ruth Warbrooke was already employed there in the kitchen. I remember the year as it was the same year my daughter turned 2 years old in November. At the time I was under the impression Ruth had been working at the Tavern for about a year."

"D"

On returning from Queensland in March 1981 my husband Gary was re-employed as a barman at the Lewisham Tavern.

I recall that Ruth Warbrooke was working at the Tavern at that time."

In reviewing the evidence placed before the Commission I must first of all take issue with DEIRT's general comment in relation to proof of long service leave entitlements that "onus of proof is not on the employee". Whilst there is a statutory obligation on every employer to maintain proper records in accordance with the Act and regulations this should not be confused with the obligation upon every applicant to establish a case for the granting of a claimed entitlement.

It can be argued that it is unfair to an employee that this task is made more difficult because proper records were not kept and passed on to subsequent employers. Equally however it can be argued that it is unreasonable to expect the last employer to be required to pay a large sum of money unless it can be clearly demonstrated in some reliable way that all of the requirements of the Act have been met.

In this instance there a number of crucial weaknesses in the case presented to the Commission including the following:

1. The claim calculated by DEIRT is based upon a commencement date of 1 January 1980, yet the sworn evidence of Mrs Warbrooke is that whilst she did occasional casual work at Lewisham Tavern since November 1979 her contract of employment did not start until a date near "Mothers Day" 1981 (i.e. May).

2. The calculated claim assumes continuous employment by Mrs Warbrooke from 1/1/1980 until 27/8/1990, a period of 10.655 years, yet:

(a) The employee concerned admits that she left work in 1981 when 3 or 4 months pregnant and did not resume until her female child was about 3 months old.

No evidence was presented as to whether such absence either

(i) broke continuity or

(ii) could have qualified as deemed service.

(b) Mrs Warbrooke gave sworn evidence that 5 or 6 years ago she just wanted "a break away" and took about six months off. Another lady took over and when the latter left she asked Mrs Warbrooke to return.

No evidence was presented as to whether such absence either:

(i) broke continuity of employment, or

(ii) could have qualified as deemed continuous service.

(c) A copy of a Taxation Group Certificate for the financial year 1983/84 showed that Mrs Warbrooke was employed by Lewisham Tavern only from 17/9/83 until 30/6/84.

Absence from work between 1/7/83 and 16/9/83 is unexplained.

3. No explanation was provided as to why Mrs Warbrooke's letter to Lewisham Tavern on 3 October (written on DEIRT's advice) referred to her eight years of service.

4. The four statutory declarations presented are mostly vague and leave a number of questions unanswered. They therefore are of little value in this instance and are no substitute for "best evidence".

Conclusions

The Commission did not have before it evidence that the claimant qualified for pro-rata long service leave payment of $1106.46 and accordingly that claim is dismissed.

Rather the evidence was that, on the balance of probability, Mrs Warbrooke had not completed seven years continuous service at the same establishment.

It is possible that a further investigation by DEIRT which addresses all of the questions raised by the Commission may shed new light upon this matter and allow the employer to be satisfied as to the true facts. In the event that a dispute still arises a further more comprehensive report could again be submitted to the Commission.

This particular case graphically illustrates the needless complexities and frustration and time wasting which arise out of the non-observance of the statutory requirement for employers in this State to keep proper long service leave records.

It is unsatisfactory to employers who take over a business to belatedly find out that they can be disadvantaged financially because they have inherited a contingency debt of unknown proportions simply because no records have been kept by the predecessor(s).

Mrs Warbrooke first contacted DEIRT almost a year ago and has been waiting all of this time to find out if she has an entitlement to pro-rata long service leave payment or not. On the advice given to her by the relevant Government Department there has been created an unfulfilled expectancy of receiving a lump sum payment. From her point of view too the whole exercise must have been a disappointment.

And DEIRT has obviously had to interview at least six people, take statements, organise statutory declarations, prepare a report and appear in the Commission for the best part of a day.

All of this could have been made simple and routine if full disclosure of facts was possible at the outset through production of proper records.

I find it both curious and regrettable that the responsible Department is given neither instruction nor the means of routinely advising and ensuring that proper records are kept by employers in accordance with the requirements of Section 18 of the Long Service Leave Act 1976 and the Long Service Leave Regulations 1977.

Unless the Act is properly administered in this regard the incidence of disputes can only increase and their fair resolution be made all that more difficult. Also under these circumstances the potential for industrial injustices occurring cannot be ruled out.

A Robinson
DEPUTY PRESIDENT

Appearances:
Mrs R Warbrooke.
Mr K Hodge for Hodge Enterprises Pty Ltd.
Mr R Millhouse for Industry Services Division, Department of Employment, Industrial Relations and Training.

Date and Place of Hearing:
1991
Hobart
October 10