Fair Work Act 2009
s.604—Appeal of decision

Lisha Herc
v
Hays Specialist Recruitment (Australia) Pty Limited
(C2022/5849)

Appeal against decision [2022] FWC 1997 of Deputy President Dean at Canberra on 2 August 2022 in U2022/1147 – appeal granted.

Background

[1] Ms Lisha Herc (Appellant) has lodged an appeal under s.604 of the Fair Work Act 2009 (FW Act), for which permission to appeal is required, against a decision of Deputy President Dean issued on 2 August 2022. The decision concerned an application for a remedy for unfair dismissal made by the Appellant, alleging that she had been dismissed by an entity referred to in her Form F2 application and the decision as ‘Hays Recruitment’. The entity responding to the appeal is Hays Recruitment (Australia) Pty Ltd which we accept is the entity against which the Appellant’s unfair dismissal application was intended to be made.

[2] It is necessary to note at the outset that the Respondent raised five jurisdictional objections to the Appellant’s unfair dismissal application, asserting in its Form F2 response that the Appellant:

•  lodged her unfair dismissal application outside the time required in s.394(2) of the Act;

•  was not an employee;

•  was not dismissed;

•  had not completed the minimum employment period as required by s.382(a) and s.383; and

•  earned more than the high income threshold.

[3] In the decision the Deputy President stated that the Respondent had four jurisdictional objections, and did not refer to the objection in relation to the minimum employment period. The Deputy President also stated that after a number of conferences with the parties, ‘it was decided that the jurisdictional objection relating to the high income threshold would be determined first because prima facie, she earned more than the high income threshold’. The Deputy President went on to find that the sum of the Appellant’s annual rate of earnings was more than the high income threshold and dismissed her application. In making that decision, the Deputy President observed that in order to determine the high income threshold objection, there was an assumption that the Appellant was an employee, notwithstanding that her employment status remained in dispute and was not determined in the decision.

[4] The appeal was the subject of a hearing in relation to both permission to appeal and the merits of the appeal. Both parties sought permission to be represented by lawyers. We were satisfied that the appeal raised issues of complexity and permission was granted on the basis that legal representation would allow the matter to be dealt with more efficiently.

Principles relevant to appeals

[5] The appeal is made under s.604 of the FW Act. There is no right of appeal and an appeal may only be made with permission of the Commission. If permission is granted, the appeal is by way of rehearing. The Commission’s powers on appeal are only exercisable if there is error on the part of the primary decision-maker. 1

[6] The Decision subject to appeal was made under Part 3-2 – Unfair Dismissal – of the Act. Section 400(1) of the Act provides that permission to appeal must not be granted from a decision made under Part 3-2 unless the Commission considers that it is in the public interest to do so. The public interest test in s.400(1) is not satisfied simply by the identification of error or a preference for a different result. In Coal & Allied Mining Services Pty Ltd v Lawler, Buchanan J (with whom Marshall and Cowdroy JJ agreed) characterised the test under s.400 of the FW Act as “a stringent one”. 2 The task of assessing whether the public interest test is met is a discretionary one involving a broad value judgment.3 In GlaxoSmithKline Australia Pty Ltd v Makin a Full Bench of the Commission identified some of the considerations that may attract the public interest. These considerations were that:

“… the public interest might be attracted where a matter raises issues of importance and general application, or where there is a diversity of decisions at first instance so that guidance from an appellate court is required, or where the decision at first instance manifests an injustice, or they result in counter intuitive, or that the legal principles applied appear disharmonious when compared with other recent decisions dealing with similar matters…” 4

[7] The decision under appeal is of a discretionary nature. In this regard, the Commission has broad discretion under s.589 of the Act to make procedural decisions about how, when and where a matter is to be dealt with. As the majority of the High Court held in Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission 5:

“Discretion’ is a notion that ‘signifies a number of different legal concepts. In general terms, it refers to a decision-making process in which ‘no one [consideration] and no combination of [considerations] is necessarily determinative of the result.’ Rather, the decision-maker is allowed some latitude as to the choice of the decision to be made. The latitude may be considerable as, for example, where the relevant considerations are confined only by the subject-matter and object of the legislation which confers the discretion. On the other hand, it may be quite narrow where, for example, the decision maker is required to make a particular decision if he or she forms a particular opinion or value judgement.” 6 (citations omitted).

[8] The majority in that decision also held that a decision maker charged with making a discretionary decision has some latitude as to the decision to be made, and given this, the correctness of the decision can only be challenged by showing error in the decision-making process. 7 Such error has also been described as the discretion not being exercised correctly. 8 It is not open to an appeal bench to substitute its view on the matters that fell for determination before the Member at first instance in the absence of appealable error. The classic statement as to the approach to be taken in relation to whether there is error in a discretionary decision, and which is applied in appeals against such decisions under s. 604 of the FW Act, was stated by the High Court in House v The King as follows:

“The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred.” 9

Permission to appeal and merits of the appeal

[9] The Full Bench is satisfied that the grant of permission to appeal in this matter is in the public interest. We are of the view that the appeal concerns issues of importance and general application concerning the proper approach to considering and determining objections to unfair dismissal applications. Permission to appeal is therefore granted in accordance with s.604(2) of the FW Act.

[10] For the reasons that follow, we have decided that in determining the jurisdictional objection relating to whether the Appellant’s earnings exceeded the high income threshold, in advance of other objections, the Deputy President erred by acting on a wrong principle and failing to take other material considerations into account. The material considerations the Deputy President failed to take into account before determining whether the Appellant’s earnings exceeded the high income threshold were: whether the application was made within the time required in s.394(2); whether the Appellant was an employee; if the Appellant was an employee, the entity that employed her; and whether the Appellant was dismissed. While the Commission has broad discretion to decide how a matter will be dealt with, by not determining, in the proper order, other objections upon which the validity an application depends, will result in an error of the kind identified in House v The King. 10

[11] Absent those findings, the Deputy President could not have determined the high income threshold objection. In reaching this conclusion, we note that the Appellant was represented by the same firm of solicitors, both in the appeal and in the first instance proceedings. We further note that the Appellant’s legal representative acquiesced in the process adopted by the Deputy President for determining the matter, and now complains about the outcome of that process. We also note that the Respondent’s contention in the appeal is that the Full Bench should uphold a decision, that is premised on a hypothesis that it employed the Appellant, which the Respondent does not accept and upon which it reserves its position.

[12] In the course of the appeal, we put to the representatives of the parties, our concerns about the process adopted at first instance by the Deputy President. Both representatives accepted that if we decided that the matter should be remitted to the Deputy President to deal with the objections in the appropriate order, the proper course would be to quash the decision. We have decided to adopt that course.

[13] We have done so because of uncertainty surrounding the Deputy President’s decision, absent consideration of other objections raised by the Respondent. To allow the decision to stand, would in our view, result in an injustice to both parties on the basis that the Appellant’s application has been dismissed without being considered in the manner required by the Act and the Respondent has succeeded on a basis that is unsound.

[14] Part 2 of the Form F3 Employer response to an unfair dismissal application, provides for the employer to make jurisdictional or other objections to an application for an unfair dismissal remedy. The Form F3 explains that jurisdictional objections relate to why an applicant is not eligible to make an application to the Commission. The first objection in the list in item 2.2 of the Form F3 is that the application is out of time, that is that the application was lodged more than 21 days after the dismissal took effect.

[15] The question of whether an application for an unfair dismissal remedy is made outside the required time, is not strictly a jurisdictional objection. Quite simply, an unfair dismissal application made outside the time required in s.394(2) is not validly made, unless and until, a further period has been granted. In the present case, the Appellant stated in her Form F2 application that she was notified of her dismissal on 5 December 2021 and that it took effect on 5 January 2022. The Respondent stated in its Form F3 response to the application that if the Appellant was dismissed, the dismissal took effect on 24 December 2021. The Appellant’s unfair dismissal application was made on 26 January 2022. If the Respondent’s contention is correct, then the application was made 12 days outside the time required in s.394(2). Before any of the other jurisdictional objections can be considered, it is necessary that the question of the date the Appellant’s dismissal took effect (if the Appellant was dismissed).

[16] The Respondent also asserted in the Form F3 that the Appellant was not an employee of the Respondent. The Respondent contended that it entered into a contract with PayMe Australia Pty Ltd for the services of the Appellant and that under the terms of that contract, the Appellant was either an employee or contractor of PayMe Australia Pty Ltd and not the Appellant or its clients. Before the Appellant can make an unfair dismissal application, she must be found to be an employee. This is a jurisdictional objection. It is axiomatic that to make this finding, it is necessary to identify the entity that is the employer. Only when these findings are made, can the issue of whether the Appellant’s annual rate of earnings exceeded the high income threshold, be determined (also a jurisdictional objection).

[17] While it may be necessary to assume that an applicant is an employee for the purposes of determining whether an application for an unfair dismissal remedy is made outside the required time, and if necessary, whether a further period should be granted for the application to be made, such assumptions cannot be made with respect to other jurisdictional objections. Where time is extended or an application is made within time, and an objection as to whether the applicant is an employee is raised, that objection must be dealt with before consideration can be given to other objections such as whether the person was dismissed, high income threshold or genuine redundancy. We observe, without deciding, that there may be single cases where objections on the grounds of no dismissal, high income threshold, minimum employment period or genuine redundancy are made and it is convenient to decide one of these issues without deciding the others. However, it is not a proper approach to deal with any of these objections before finding that an application is made within the required period or granting a further period and then determining whether an applicant is an employee and if necessary, the identity of the employer.

Conclusion and disposition of the appeal

[18] For the reasons given, we grant permission to appeal, uphold the appeal and quash the decision. Pursuant to s.607(3)(c), we refer the matter to Deputy President Dean to deal with in accordance with this decision.

[19] The Orders of the Commission are:

1. Permission to appeal is granted.

2. The Appeal is upheld.

3. The Decision in [2022] FWC 1997 is quashed.

4. The matter is referred to Deputy President Dean to determine:

a. whether the Appellant’s unfair dismissal application was filed within the time required in s.394(2) of the Act;
b. whether the Appellant was an employee;
c. if the Appellant was an employee, the entity that employed her;
d. whether the Appellant was dismissed; and
e. whether the sum of the Appellant’s annual rate of earnings exceeded the high income threshold.

VICE PRESIDENT

Appearances:

Mr R Markham for the Appellant
Mr C Bell for the Respondent

Hearing details:

2022.
Microsoft Teams (Video).
10 October.

Printed by authority of the Commonwealth Government Printer

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 1   Coal and Allied Operations Pty Limited v Australian Industrial Relations Commission and Others (2000) 203 CLR 194 at [17] per Gleeson CJ, Gaudron and Hayne JJ

 2   Coal & Allied Mining Services Pty Ltd v Lawler (2011) 207 IR 177 at [43]

 3   O’Sullivan v Farrer and Another (1989) 168 CLR 210 at 216-217 per Mason CJ, Brennan, Dawson and Gaudron JJ; applied in Hogan v Hinch (2011) 243 CLR 506 per Gummow, Hayne, Heydon, Crennan, Kiefel and Bell JJ at [69]; Coal & Allied Mining Services Pty Ltd v Lawler (2011) 207 IR 177 at [44]-[46]

 4   (2010) 197 IR 266 at [27]

 5   (2000) 203 CLR 194.

 6   Ibid at [19] per Gleeson CJ, Gaudron J and Hayne J.

 7   Ibid at [21].

 8   House v The King (1936) 55 CLR 499 at [504]-[505] per Dixon, Evatt and McTiernan JJ

 9   Ibid

 10   (1936) 55 CLR 488.