Fair work laws; what is a “transferring employee?”

There are several legal implications uder the Fair Work Act depending upon whether an employee is a trannferring employee”. These passages explain the legal context.

“2. Section 384(2)(b)(i) – was the Applicant a transferring employee?
[23] In determining whether the Applicant was a transferring employee, there must be a
transfer of business per s311 of the Act. It is not contentious that the criteria set out in section
311(1)(a) and (b) have been met. There is contention between the parties regarding s311(1)(c)
regarding the Applicant’s new role with Ritek Technology compared to her existing role with
Ritek Australia.
[24] The Respondent states that the Applicant’s role had changed from drafting/scheduling
to logistics and material procurement when she was with Ritek Australia. However, the
Respondent required a transition of role back to drafting and scheduling to cope with the
workload, and that it was to be done over a 2-month period. The Applicant states that she was
doing both the drafting, scheduling and logistics, and that the logistics part of her roles would
be delegated to another staff member. The Applicant states the staff member was struggling
with the logistics aspect which left the position still requiring herself to be fully relied upon.
[25] In assessing whether the work the employee performs for the new employer is the same
or substantially the same as the work performed for the old employer, the Federal Court
decisions of Crown Sydney Gaming Pty Limited v United Workers Union [2022] FCA 97 by
Jagot J, and Community and Public Sector Union, NSW Branch v Northcott Supported Living
Limited [2021] FCA 8 by Katzmann J have provided the below principles:
[2023] FWC 885
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1. the performance of the tasks comprising of the job1
; if the character of employment is
the same – meaning the substance of work rather than just the particular duties
themselves.
2. Particular duties that may not be required or performed at any particular time would not
unduly interfere with the interests of employers in running their enterprises efficiently
would not change the substance of work.2
3. the product or services of the company have not required the employee to significantly
retrain or upskill;
4. “Employees are expected to adapt [themselves] to new methods and techniques
introduced in the course of employment.”3 However, it cannot be a completely different
kind of work.4
5. the location where work is performed has no bearing upon the characterisation of work;5
[26] Although the Applicant had a larger focus on a different aspect of her role with Ritek
Technology compared to Ritek Australia, she was still undertaking aspects of her old role which
were of the same character with the new employer. The role which Ritek Technology provided
was an adaptation to business needs rather than requiring the Applicant to undertake a
completely different line of work.
[27] I am satisfied the Applicant is a transferring employee as defined by s 311(2).
3. Section 384(2)(b)(i) – was there a transfer of business?
[28] A primary issue for determination is whether s 311(1)(d) has been satisfied, and
subsequently, whether there was a transfer of business pursuant to s 311(1). In order to
determine this, it is necessary to consider the provisions of ss 311(3) to (6) to ascertain if any
of them have been met. In this case, s 311(3) is the only potentially relevant subsection to
consider.
[29] In the current circumstances, where the new employer has purchased the business from
the old employer, there is clearly a transfer of assets. Therefore, s 311(1)(d) is satisfied and I
find there has been a transfer of business as defined by s 311(1).
[30] I am satisfied that both ss 384(2)(b)(i) and 22(7) are satisfied. There has been a transfer
of business and a transfer of employment under the Act.
4. Section 384(2)(b)(ii) – were the old employer and new employer associated entities?
[31] There is no indication of control or significant influence between the entities as the old
employer Ritek Australia went into liquidation and is confirmed by ASIC through the Notice
of Appointment as Liquidator on 21 September 2022 and the Cooroy plant is now controlled
by Ritek Technology. Although Ritek Australia was likely to have been a part of a division of
the Ritek group, I am satisfied that there is no control or significant influence between the old
employer and new employer. Therefore, I am satisfied that that the old employer and the new
employer are not associated entities under s 50AAA of the Corporations Act 2001 (Cth).
[2023] FWC 885
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5. Section 384(2)(b)(iii) – did the new employer inform the employee in writing before
employment commenced that the period of service with the old employer would not be
recognised?
[32] Section 384(2)(b)(iii) only requires the new employer to inform the employee in writing
before the new employment that their previous service would not be recognised. The Act does
not prescribe a criterion when determining if the employee acknowledges this fact, if it must be
specifically brought to their attention, or if they agree.
[33] In Gregory v Shaver Shop Pty Ltd [2016] FWC 1323, Gooley DP found that where there
is a transfer of business, the employer is obliged to make it clear to the transferring employee
whether service with the old employer will be recognised. Gooley DP states this is important
for two reasons. First, the employee will know that they will not be protected from unfair
dismissal for the qualifying period and second, it will assist the employee to determine if he or
she refuses the job offer whether he or she is entitled to redundancy pay. For these reasons the
written advice to employees should be clear.6
[34] The Applicant submits that she was not provided notice in writing that her previous
service with Ritek Australia would not be recognised, and the Respondent has not provided any
evidence which suggests that her period of service with the old employer would not be
recognised. I am not satisfied that the Respondent has complied with the obligation under s
384(2)(b)(iii).
6. Sections 382(a) and 383(a) – was the Applicant a person protected from unfair
dismissal; did they satisfy the minimum employment period?
[35] By virtue of the operation of subsection 384(2)(b) of the Act, the Applicant’s period of
employment with the old employer is included as Ritek Technology Pty Ltd (the new
employer) failed to inform the Applicant that her period of service with Ritek Australia (the
olde employer) would not be recognised. Therefore, her previous employment with Ritek
Australia Pty Ltd should be recognised as a period of employment relevant to the minimum
employment period as prescribed by section 383 of the Act.
[36] The Applicant is a person protected from unfair dismissal and the jurisdictional
objection must be dismissed. The application will now be determined on its merits and my
Chambers will issue further directions.”

Buttenshaw v Ritek Technology [2023] FWC 885 delivered 14 April 2023 per Lake DP