Length of employment for unfair dismissal

This portion of an unfair dismissal decision sets out the legal principles which are applied in the federal fair work system to calculate the length of an employee’s employment to determine whether the employee is protected from unfair dismissal.

 

“Consideration

Legislative provisions

[43] Section 382 of the FW Act provides that a person is protected from unfair dismissal if

they have completed a period of employment of at least the minimum employment period.

[44] Section 383 sets out the minimum employment period:

“383 Meaning of minimum employment period

The minimum employment period is:

(a) if the employer is not a small business employer—6 months ending at the earlier

of the following times:

(i) the time when the person is given notice of the dismissal;

(ii) immediately before the dismissal; or

(b) if the employer is a small business employer—one year ending at that time.”

[45] Section 384 provides:

“384 Period of employment

(1) An employee’s period of employment with an employer at a particular time is the

period of continuous service the employee has completed with the employer at that

time as an employee.

(2) However:

(a) a period of service as a casual employee does not count towards the employee’s

period of employment unless:

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(i) the employment as a casual employee was as a regular casual employee;

and

(ii) during the period of service as a casual employee, the employee had a

reasonable expectation of continuing employment by the employer on a regular

and systematic basis; and

(b) if:

(i) the employee is a transferring employee in relation to a transfer of

business from an old employer to a new employer; and

(ii) the old employer and the new employer are not associated entities when

the employee becomes employed by the new employer; and

(iii) the new employer informed the employee in writing before the new

employment started that a period of service with the old employer would not be

recognised;

the period of service with the old employer does not count towards the employee’s

period of employment with the new employer.”

[46] Section 12 defines “service” by referring to “section 22” and “continuous service” as

having “a meaning affected by section 22”.

[47] In somewhat curious drafting, s 22 defines “service” but does not contain an express

meaning of “continuous service” (though the phrase is bolded by the legislature in s 22(4)(b)

without subsequent definition). Section 22 relevantly provides:

“22 Meanings of service and continuous service

General meaning

(1) A period of service by a national system employee with his or her national

system employer is a period during which the employee is employed by the

employer, but does not include any period (an excluded period) that does not

count as service because of subsection (2).

(2) The following periods do not count as service:

(a) any period of unauthorised absence;

(b) any period of unpaid leave or unpaid authorised absence, other than:

(i) a period of absence under Division 8 of Part 2-2 (which deals

with community service leave); or

(ii) a period of stand down under Part 3-5, under an enterprise

agreement that applies to the employee, or under the employee’s

contract of employment; or

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(iii) a period of leave or absence of a kind prescribed by the

regulations;

(c) any other period of a kind prescribed by the regulations.

(3) An excluded period does not break a national system employee’s continuous

service with his or her national system employer, but does not count towards the

length of the employee’s continuous service.

(3A) Regulations made for the purposes of paragraph (2)(c) may prescribe different

kinds of periods for the purposes of different provisions of this Act (other than

provisions to which subsection (4) applies). If they do so, subsection (3) applies

accordingly.”

[48] A “casual employee” is defined in s 15A as:

“15A Meaning of casual employee

(1) A person is a casual employee of an employer if:

(a) an offer of employment made by the employer to the person is made on the basis

that the employer makes no firm advance commitment to continuing

and indefinite work according to an agreed pattern of work for the

person; and

(b) the person accepts the offer on that basis; and

(c) the person is an employee as a result of that acceptance.

(2) For the purposes of subsection (1), in determining whether, at the time the offer is

made, the employer makes no firm advance commitment to continuing and

indefinite work according to an agreed pattern of work for the person,

regard must be had only to the following considerations:

(a) whether the employer can elect to offer work and whether the person can elect to

accept or reject work;

(b) whether the person will work as required according to the needs of the employer;

(c) whether the employment is described as casual employment;

(d) whether the person will be entitled to a casual loading or a specific rate of pay for

casual employees under the terms of the offer or a fair work

instrument.

Note: Under Division 4A of Part 2-2, a casual employee who has worked for an employer for at least

12 months and has, during at least the last 6 months of that time, worked a regular pattern

of hours on an ongoing basis may be entitled to be offered, or request, conversion to

full-time employment or part-time employment.

(3) To avoid doubt, a regular pattern of hours does not of itself indicate a firm advance

commitment to continuing and indefinite work according to an agreed

pattern of work.

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(4) To avoid doubt, the question of whether a person is a casual employee of an

employer is to be assessed on the basis of the offer of employment and the

acceptance of that offer, not on the basis of any subsequent conduct of either

party.

(5) A person who commences employment as a result of acceptance of an offer of

employment in accordance with subsection (1) remains a casual

employee of the employer until:

(a) the employee’s employment is converted to full-time or part-time employment under

Division 4A of Part 2-2; or

(b) the employee accepts an alternative offer of employment (other than as a casual

employee) by the employer and commences work on that basis.”

[49] A “regular casual employee” is defined in s 12 as:

“a national system employee of a national system employer is a regular casual

employee at a particular time if, at that time:

(a) the employee is a casual employee; and

(b) the employee has been employed by the employer on a regular and

systematic basis.”

The required period of service

[50] Modern Concrete is a small business employer. In order to be protected from unfair

dismissal, the minimum employment period required to have been served by Mr Spadavecchia

prior to his dismissal taking effect was one calendar year (twelve months).

[51] As Mr Spadavecchia’s dismissal took effect on 4 August 2023, the question which arises

is whether he had twelve months of “continuous service” (s 384(1)) prior to that date.

[52] “Service” as an employee for the purposes of s 22 does not require a person to be

actually working on each of the days in the relevant period. Rather, the issue is whether an

unbroken employment relationship existed in that period. The reason for this is self-evident. An

employee may be rostered off work during a relevant period or not required to work on a day

or days during a relevant period or be taking paid or unpaid leave during a relevant period yet

be in continuous service as an employee. It is a separate issue, addressed by s 22(2), whether a

particular day or days in that period are excluded from being counted towards the length of

continuous service.

[53] As noted, the phrase “continuous service” (used in s 384) is not defined in the FW Act.

However, its ordinary meaning is a period of unbroken service by an employee with an

employer.7 Subject to the statutory exceptions in s 22, “continuous service” for the purposes of

ss 384 and 22 of the FW Act requires the employment relationship to have been unbroken.

However, as provided by s 384(2)(a), for unfair dismissal purposes regularly and systematically

rostered casual employees remain in service notwithstanding that each engagement may be by

separate casual contracts provided reasonable expectation of continuing employment on that

basis exists. Gaps in time between such contracts do not necessarily break service because it is

the employment relationship and not the contract that is assessed for continuity.8

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[54] For these reasons, the phrases “period of employment” and “continuous service” in s

384 of the FW Act and the phrase “continuous service” in s 22 are best read as relating to a

period of an unbroken employment relationship and not necessarily an unbroken employment

contract (subject to the further statutory provisions in s 22 which deem certain service to be

continuous despite a break in the employment relationship).

[55] It is not disputed by Modern Concrete that Mr Spadavecchia was in continuous service

between 10 August 2022 and 4 August 2023. This is because it is not disputed that Mr

Spadavecchia was employed in a full-time capacity by an offer accepted on 7 August 2022 and

that he commenced in that capacity on 10 August 2022.

[56] The relevant issue is whether Mr Spadavecchia was also in a period of “continuous

service” in at least the six days prior to his full-time employment commencing, that is between

4 and 10 August 2022.

[57] The answer to this question firstly rests on whether an employment relationship between

Mr Spadavecchia and Modern Concrete existed during this six-day period. This is because

“continuous service” for the purpose of s 384 and “service” within the meaning of s 22 means

service as an employee. Section 22(1) provides that it must be a period “during which the

employee is employed by the employer”. To have been “employed by the employer” requires

an employment relationship to have existed in the relevant period.

Was there an employment relationship prior to 10 August?

[58] On 27 July and 28 July 2022 Mr Spadavecchia performed work on two concreting sites.

Mr Spadavecchia did so at the invitation of the business. The business asked him to do so

because it wished to assess his suitability for the job he had expressed interest in. In order to

make that assessment, the business owner wanted to assess the ‘on the job’ skills and capacity

of Mr Spadavecchia. Mr Spadavecchia agreed to work on 27 July and, in a subsequent

discussion, agreed to also work on 28 July. There was no agreement or understanding as to pay

or conditions because the business considered it a trial period. On these days Mr Spadavecchia

performed five hours of work and eight hours of work respectively, labouring and assisting

during two different concrete pours. He actively worked, not simply observed others working.

[59] Mr Spadavecchia was not working as a contractor. He worked under the control and

direction of Mr Domin and the supervisors on the day.

[60] Nor does the evidence support a finding that Mr Spadavecchia was, on either of these

days working under a full-time employment contract or as a part-time employee. Rather he

worked the hours required on each day until the job was completed for the day. This is indicative

of casual employment. Mr Spadavecchia worked “as required according to the needs of the

employer” within the meaning of s 15A(2)(b) of the definition of “casual employee” in the FW

Act. There was no “firm advance commitment to continuing and indefinite work” within the

meaning of s 15A(2)(a).

[61] Was this casual employment?

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[62] It is arguable that no contract of employment existed because whilst an offer, acceptance

and consideration arguably existed, it could be said that the necessary intention to enter legal

relations was absent. Further it could be well argued that Mr Spadavecchia was simply

volunteering his labour solely for the purposes of being assessed. Factors used to determine

whether a person is performing ‘work’ as a volunteer or intern are well established9

. In this

matter, some point in that direction, others do not.

[63] That said, it is also tolerably arguable (and somewhat the better proposition) that Mr

Spadavecchia was a casual employee on these days despite no express agreement to that effect.

[64] The FW Act provides only limited scope for work in a commercial business setting

which is performed under the control and supervision of a business owner and at their request

to be unpaid training or voluntary work.10

[65] It is well established that mere labelling a form of work in a particular manner (in this

case, a ‘trial period’) does not of itself characterise the engagement as such. Having accepted

the offer to work on these days, Mr Spadavecchia provided his labour in a manner that

somewhat benefited the business. He worked to assist the completion of the job, and worked

under the observation of the business owner and supervisors. Whilst there was no agreement to

remunerate and some doubt exists as to whether a cash payment was made, this does not mean

that there was no employment that required remuneration.

[66] I give no weight to company personnel, superannuation and long service leave records

tendered by Modern Concrete that indicate a commencement date of 10 August 2022.11 A

record of a commencement date is, at best, a record of a business entry reflecting its

understanding at a given point in time. It is not, of itself, objective evidence of whether an

employment relationship existed prior to that date.

[67] However, in light of the issue of a prior employment relationship not being clear-cut

and because (below) I have found that Mr Spadavecchia, if a casual employee on these days,

was not a “regular casual employee” within the meaning of the FW Act, it is not necessary to

make a formal finding to this effect.

Are the days prior to 10 August 2022 counted?

[68] That a casual employment relationship may have existed on 27 July and 28 July 2022

does not necessarily mean that Mr Spadavecchia was a person employed by Modern Concrete

beyond those days and until 10 August 2022. After 28 July 2022 he did not work for Modern

Concrete again for twelve days. Rather, he worked for his then employer on 29 July and 1

August, resigning effective that day.

[69] Section 384(2) makes it clear that, for days in this period to be counted, Mr

Spadavecchia not only has to establish that he was a casual employee (as defined) but also:

  • that he was a “regular casual employee” (as defined in s 12); and
  • that he had a reasonable expectation of continuing employment on a regular and

systematic basis (s 384(2)(a)(ii)).

[70] On the evidence, neither proposition is made out.

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[71] It was clearly understood and agreed between the parties that the two days of work on

27 and 28 July 2022 would be for the purpose of the business forming a view as to his suitability

for a full-time offer. The evidence is that an offer was then made by Modern Concrete in the

week that followed (on 3 August) which was accepted on 7 August 2022.

[72] There is no evidence that Mr Spadavecchia had, prior to 10 August 2023, “been

employed by the employer on a regular and systematic basis” as required by the definition of

“regular casual employee” in s 12. Rather the evidence is to the contrary; there were separately

made agreements to work on 27 and 28 July 2022 for a singular purpose – to be assessed for

suitability. Beyond those days, and if and until an offer of full-time employment was made and

accepted, no other work was offered and none performed. Indeed, Mr Spadavecchia was not

available to work for Mr Domin at least until 2 August. At its highest, on 28 July 2022 Mr

Domin told Mr Spadavecchia that he was suitable and would be offered a full-time contract.

Even if that were so (and on the evidence it is more likely than not), a promise of a forthcoming

full-time offer does not establish the fact of regular and systematic employment prior to that

offer being made and accepted.

[73] Mr Spadavecchia was not a “regular casual employee” prior to 10 August 2022. Nor

was he employed in any capacity prior to that date other than potentially on the two days 27

and 28 July 2022 when it is arguable that he was casually employed.

[74] Not being a “regular casual employee”, Mr Spadavecchia could not and did not, in this

period, have had a reasonable expectation of continuing employment on that basis (s 384(a)(ii)).

[75] This being so, the two days of work, even if they were employment, do not count as part

of the minimum employment period (s 384(2)(a)).

[76] Further, Mr Spadavecchia was not “employed by the employer” in the sense required

by s 22(1) in the gap period after 28 July 2022, and in particular was not so employed between

4 and 10 August 2022.

[77] That being so, it is not necessary to determine whether days in the gap period were

“excluded periods” within the meaning of s 22(2) of the FW Act.

Conclusion

[78] The periods of Mr Spadavecchia’s employment with Modern Concrete were, arguably,

two stand-alone periods of employment as a casual employee on 27 July 2022 and 28 July 2022,

and an undisputed period of continuous service as a full-time employee commencing 10 August

2022.

[79] The gap between 28 July 2022 and 10 August 2022 was not a period of “continuous

service” with the employer within the meaning of s 384(1) of the FW Act and in particular the

period 4 August 2022 to 10 August 2022 was not.

[80] Consequently, no days prior to 10 August 2022 are included in the count for the purposes

of determining the minimum employment period.

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[81] That being so, the “period of employment” for the purposes of ss 383 and 384 of the

FW Act served by Mr Spadavecchia immediately prior to the dismissal on 4 August 2023 fell

short of the one year minimum employment period by six days.

[82] That being so, Mr Spadavecchia had not relevantly completed the period of employment

required by s 382 of the FW Act to be protected from unfair dismissal.

[83] In light of this, there is no jurisdiction to hear and determine the unfair dismissal

application. It must be dismissed.

[84] An order giving effect to this decision is issued in conjunction with its publication.12″

 

 

Spadavecchia v The Trustee For Modern Concrete Co Trust T/A Modern Concrete Co [2023] FWC 2747 delivered 20 October 2023 per Anderson DP