1
Fair Work Act 2009
s.604—Appeal of decision
Maturu
v
Leica Geosystems Pty Ltd
(C2014/4626)
VICE PRESIDENT CATANZARITI
DEPUTY PRESIDENT ASBURY
COMMISSIONER SPENCER
SYDNEY, 29 SEPTEMBER 2014
Appeal against decision in transcript of Commissioner Booth at Brisbane on 8 May 2014 in
matter number U2013/14485.
[1] This is an appeal by Mr Sasidhar Maturu (the Appellant) against a decision made in
transcript by Commissioner Booth at Brisbane on 8 May 2014 and an order1 (Order) issued by
the Commissioner on the same day. The Commissioner dismissed the Appellant’s unfair
dismissal application on the basis that the Fair Work Commission (the Commission) does not
have jurisdiction to hear the matter.
[2] At the hearing of the appeal, the Appellant was not represented. Leica Geosystems Pty
Ltd (the Respondent) sought permission to be represented by Mr L Thorburn of Bennett &
Philp Lawyers. Permission was granted on the basis that, although the matter was not
significantly complex, we were satisfied that the matter would be dealt with more efficiently
if permission to be represented was granted.
Background
[3] The primary issue of dispute at first instance was whether the Appellant was protected
from unfair dismissal for the purposes of s.382 of the Fair Work Act 2009 (the Act). The
Respondent contended that the Appellant’s annual rate of earnings and other relevant amounts
were higher than the high income threshold. The Appellant contended that he was protected
from unfair dismissal as his income did not exceed the high income threshold.
[4] The relevant high income threshold applicable in this matter is $129,300. It was not
contested on appeal that the Appellant’s base annual rate of earnings was $129,000 at the time
of dismissal. The sole issue on appeal was whether the Commissioner was correct in her
conclusion that the Appellant had the benefit of access to mobile broadband, and whether
certain mobile broadband usage should count towards the calculation for the purposes of
s.382 of the Act.
[2014] FWCFB 6735
REASONS FOR DECISION
E AUSTRALIA FairWork Commission
[2014] FWCFB 6735
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[5] The Commissioner considered this issue in some detail and it is worth reproducing the
Commissioner’s reasoning on this issue in its entirety:
“The issue of access to the laptop and mobile phone were the subject of significant
evidence in this matter. The respondent submits that the applicant had private use of
his own laptop and mobile. Ms Blair's evidence, in particular her second witness
statement, attaches various details of phone and data access from the applicant. She
deposes as follows, ‘The applicant also had the benefit of a laptop computer with
unlimited broadband via a USB data dongle. The applicant had sole use of the laptop
and the applicant would use the laptop at home out of business hours. I recall
telephoning the applicant during the period of unpaid leave to question a very large
usage bill which we had received from internet usage. The applicant apologised and
said words to the effect, “My daughter might have been playing around with it."’
I note this particular bill issue date is 15 July and there was a similar bill for August
2013. I turn now to Mr Maturu's evidence on this point. The applicant says he points to
his contract which says, ‘The laptop will be supplied to you for work purposes.’ There
is an asterisk which states as follows, ‘It is to be noted that this equipment remains the
property of Leica Geosystems and is only to be used while in the employ of Leica
Geosystems.’ The contract also states, ‘Broadband internet access costs will be paid by
Leica.’ Additionally with regard to the mobile phone contract it states as follows, ‘A
Blackberry mobile phone will apply to the engagement of Leica,’ this clause is also
asterisked. Mr Maturu's evidence was that he also had a personal laptop and phone and
used his own equipment while he was on sick leave and in fact he should have been
charging that employer. Mr Maturu said that both his laptop and phone were left on his
desk at work. He wondered if a Sim card had been swapped.
Mr Maturu denies that he was responsible for the $500 a month and asserts that
perhaps it was somebody else's use. I now turn to discussion of the evidence on the
data laptop and mobile phone usage. On the question of the Sim card Ms Blair's
evidence was clear. Should the device be swapped the same Sim card and data dongle
assigned to the applicant would remain. Mr Maturu could not remember the
conversation with Ms Blair where she inquired about the high data use. This seemed
surprising. It is especially surprising if the applicant was of the view he was not
allowed to use his personal laptop or mobile in accordance with the contract. In those
circumstances an inquiry from an employer of a large data use would seem to me to be
something that was important.
On these points I prefer the evidence of Ms Blair. Not only could Mr Maturu not
remember what I considered to be an important conversation, there are other
inconsistencies in his evidence at the time indicating some personal usage was
allowed, at other times insisting he only used his personal phone. I turn now to the
assessment then of the appropriate amount for access to laptop, phones and data use.
The employer suggested a pro rata amount of $1,000 and $500 for the laptop and
mobile respectively, that being $737.10 for laptop access for the period until dismissal
and $369.90 for the mobile access. The applicant says if these amounts were to be
accepted they are in fact too high and that the equipment itself would have been
written off given it was quite old. The applicant did accept he had an offer of a new
iPhone but because of his sick leave did not in fact access this equipment. I consider
[2014] FWCFB 6735
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that both these amounts are too high and few details assist me to break down the
personal and private use of the phone and laptop.
I do note, however, that the data use was when the applicant was on leave, which is the
subject of the telephone inquiry I referred to earlier is clear. Even if that is discounted,
as the applicant suggests some work was done while on unpaid sick leave, the amount
of data use for the laptop for the period when the applicant was on sick leave is over
$1,000. I therefore calculate that an amount of 80 per cent or $800 of the data use is
private and should be added to the calculation. While this means that the applicant in
addition to his salary earnings is over the high income threshold, being now $129,800,
I would add for the sake of completeness I would also have included an amount for
professional memberships in similar terms to that suggested by the employer.”2
Legislation
[6] Section 382 of the Act sets out the circumstances in which a person will be protected
from unfair dismissal as follows:
“382 When a person is protected from unfair dismissal
A person is protected from unfair dismissal at a time if, at that time:
(a) the person is an employee who has completed a period of employment
with his or her employer of at least the minimum employment period; and
(b) one or more of the following apply:
(i) a modern award covers the person;
(ii) an enterprise agreement applies to the person in relation to the
employment;
(iii) the sum of the person’s annual rate of earnings, and such other
amounts (if any) worked out in relation to the person in accordance with
the regulations, is less than the high income threshold.”
[7] The term “earnings” is defined in s.332 of the Act as follows:
“332 Earnings
(1) An employee’s earnings include:
(a) the employee’s wages; and
(b) amounts applied or dealt with in any way on the employee’s behalf or as
the employee directs; and
(c) the agreed money value of non-monetary benefits; and
(d) amounts or benefits prescribed by the regulations.
[2014] FWCFB 6735
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(2) However, an employee’s earnings do not include the following:
(a) payments the amount of which cannot be determined in advance;
(b) reimbursements;
(c) contributions to a superannuation fund to the extent that they are
contributions to which subsection (4) applies;
(d) amounts prescribed by the regulations.
Note: Some examples of payments covered by paragraph (a) are commissions,
incentive-based payments and bonuses, and overtime (unless the overtime is
guaranteed).
(3) Non-monetary benefits are benefits other than an entitlement to a payment of
money:
(a) to which the employee is entitled in return for the performance of work; and
(b) for which a reasonable money value has been agreed by the employee and
the employer;
but does not include a benefit prescribed by the regulations.
(4) ...”
[8] Regulation 3.05(6) of the Fair Work Regulations 2009 (the Regulations) provides as
follows:
“(6) If:
(a) the person is entitled to receive, or has received, a benefit in accordance
with an agreement between the person and the person’s employer; and
(b) the benefit is not an entitlement to a payment of money and is not a non-
monetary benefit within the meaning of subsection 332(3) of the Act; and
(c) the FWC is satisfied, having regard to the circumstances, that:
(i) it should consider the benefit for the purpose of assessing whether
the high income threshold applies to a person at the time of the
dismissal; and
(ii) a reasonable money value of the benefit has not been agreed by the
person and the employer; and
(iii) the FWC can estimate a real or notional money value of the benefit;
[2014] FWCFB 6735
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the real or notional money value of the benefit estimated by the FWC is an
amount for subparagraph 382(b)(iii) of the Act.”
[9] The Commissioner found that the Appellant utilised his mobile broadband service
while on leave and that the value of this use was $800. It is not clear from the
Commissioner’s decision the precise process by which this amount was to contribute towards
the overall calculation of the Appellant’s earnings for the purposes of s.382(b)(iii) of the Act.
As there is no evidence of any agreed monetary value in relation to the mobile broadband
usage, it appears that such usage could not meet the definition of “non-monetary benefit” as
found in s.332(3) of the Act. It would appear, therefore, that the Commissioner utilised the
Commission’s power under reg 3.05(6)(c) of the Regulations to estimate the real or notional
money value of this “benefit.”
[10] A Full Bench of the Australian Industrial Relations Commission considered the issue
of non-monetary benefits in the context of motor vehicles in Rofin Australia Pty Ltd v
Newtown (1997) 78 IR 78 as follows:
“These principles appear to reflect a distinction that has been made, in our view quite
properly, between the provision of a motor vehicle as part of a salary package and the
provision of a motor vehicle as a piece of equipment supplied by the employer to
enable the employee to perform the job.
Where a motor vehicle is provided to an employee in lieu of salary that might
otherwise have been paid, it is appropriate that the private benefit derived by the
employee from the provision of the motor vehicle be counted as part of the employee’s
remuneration. Where, however, the vehicle is provided for business purposes and the
employee’s entitlement to private use is purely incidental, the provision of the motor
vehicle should be treated no differently to the provision by the employer of any other
tool or piece of equipment essential to the performance of the job.”
(References omitted)
[11] These principles apply, by analogy, to mobile broadband access. In this matter, the
applicant’s use of the mobile broadband was governed by his employment contract which
provided as follows:
“Additional Benefits
In addition to your salary, the following benefits will apply to your engagement with
Leica:
...
A Laptop will be supplied to you for work purposes **
Broadband internet access costs will be paid by Leica
A Blackberry / Mobile Phone will apply to your engagement with Leica **
[2014] FWCFB 6735
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** It is to be noted that this equipment remains the property of Leica Geosystems and
is only to be used whilst under the employ of Leica Geosystems”
[12] It is clear, in this context, that the mobile broadband service was provided to the
Appellant as a piece of equipment that was essential to the performance of his job. The
Commissioner found that the mobile broadband had been utilised while the Appellant was on
sick leave, and calculated that 80% of this usage had been for private purposes. While this
finding was open to the Commissioner on the basis of the evidence before her, we are not
satisfied that, in all of the circumstances of the case, the private usage of the mobile
broadband service is sufficient to enliven the Commission’s powers under reg 3.05(6).
[13] In order for the Commission to make an estimate of the real or notional money value
of a benefit pursuant to reg 3.05 and to have that estimate contribute to the calculation for the
purposes of s.382(b)(iii) of the Act, each part of the cumulative test in reg 3.05(6) must be
satisfied. Regulation 3.05(6)(a) requires that “the person is entitled to receive, or has received,
a benefit in accordance with an agreement between the person and the person’s employer”
(emphasis added).
[14] While the contract of employment does not explicitly limit the use of mobile
broadband to work purposes, the context in which it appears in the contract does not give rise
to any implication of an agreement between the Appellant and the Respondent that the mobile
broadband service may be used for private purposes. Additionally, the evidence of Ms Megan
Elizabeth Blair (Ms Blair) at first instance further negates any implication as to an agreement
that the mobile broadband service could be utilised for private purposes:
“Did Leica monitor the internet use of employees' laptops?---We have a standard where
if it goes above say 150 then that flags it as high usage.
That's $150 is it?---Yes, per month, yes.
Did that ever happen in the case of the applicant?---Yes, it did while he was on unpaid
leave.
Did you question the applicant on that?---Yes, we did.
Was that you, did you contact the applicant?---Yes, I believe I asked him why it was
so high because for two months in a row it was $500 and he was on unpaid leave, so I
questioned why it was over that amount.
Do you remember what the applicant said to you?---He said something to the effect
that he thinks that possibly his daughter was playing around with it.”3
[15] While the Appellant gave evidence at first instance that he did not recall this
conversation, the Commissioner found that she preferred the evidence of Ms Blair. This
finding was reasonably open to her. This conversation militates against any inference that
there was an agreement between the parties as to the private usage of the mobile broadband
service. The existence of an agreement between the parties that the Appellant had the benefit
of private usage of the mobile broadband service is not consistent of the Respondent’s actions
in contacting him while he was on unpaid leave to inquire as to why the usage was so high.
Finally, the Respondent expressed the view in its written submissions that “[the employment]
[2014] FWCFB 6735
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contract is quite clear that the laptop and the internet access were only to be used for work
purposes,” which further suggests that no such agreement was in place.
[16] We are not satisfied that there was any agreement between the parties in relation to the
private use of the mobile broadband service. In these circumstances, the Appellant’s usage of
the mobile broadband service while on unpaid leave may even have resulted in disciplinary
action being taken by the Respondent, were it so inclined. Such a state of affairs could hardly
be considered a “benefit” in the ordinary meaning of the term. In any event, where a person
has received a benefit that was not in accordance with an agreement between that person and
his or her employer, the Commission’s power under reg 3.05(6) will not be enlivened.
Public Interest
[17] In order to grant the Appellant permission to appeal, the Full Bench must be satisfied
that it is in the public interest to do so.4 In GlaxoSmithKline Australia Pty Ltd v Colin Makin5
a Full Bench summarised the concept of public interest in the following terms:
“Although 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 the result is counter intuitive, or that the legal
principles applied appear disharmonious when compared with other recent decisions
dealing with similar matters...”
[18] We are satisfied that this matter raises issues of importance and general application.
The proper approach to the application of reg 3.05(6) is an issue that is currently the subject
of few authorities. We believe that a Full Bench decision on this issue will provide some
guidance in relation to this issue. We are of the view that this guidance is particularly
warranted given that the application of this provision will go to issues of the Commission’s
jurisdiction.
Conclusion
[19] We are of the view that the Commissioner has made an error of law with respect to her
application of reg 3.05(6), and that no additional sum should be added to the calculation for
the purposes of s.382(b)(iii) of the Act in relation to the mobile broadband service.
[20] We note that the Commissioner made some additional observations in her decision
without making a final ruling:
“While this means that the applicant in addition to his salary earnings is over the high
income threshold, being now $129,800, I would add for the sake of completeness I
would also have included an amount for professional memberships in similar terms to
that suggested by the employer.
The reason I say this is that in some employment situations some payments may be
made by the employer but in this case there was no evidence that it was part of a
contract and therefore in my view payment of such amounts could be included in the
applicant's annual rate of earnings, but as I indicated it is not necessary for further
details to go into in that matter.”
[2014] FWCFB 6735
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[21] Having found that no additional sum should be calculated in relation to the mobile
broadband service, it is not necessary for us to consider the issue of professional
memberships. The Respondent has submitted that the value of the Appellant’s professional
memberships was $207.27. Even were this calculation accepted at face value, it would not
bring the total amount of the calculation for the purposes of s.382(b)(iii) beyond the high
income threshold.
[22] We find that permission to appeal should be granted and the appeal upheld. The Order
and decision that are the subject of this appeal are quashed. We find that the Respondent’s
jurisdictional objection should be dismissed. We remit the Appellant’s unfair dismissal
application to Commissioner Spencer who will make arrangements directly with the parties
for the matter to be conciliated.
VICE PRESIDENT
Appearances:
S Maturu appeared on his own behalf.
L Thorburn of Bennett & Philp Lawyers for Leica Geosystems Pty Ltd.
Hearing details:
2014.
Brisbane:
September 4.
Printed by authority of the Commonwealth Government Printer
Price code C, PR555873
1 Mr Sasidhar Maturu v Leica Geosystems Pty Ltd [PR550422].
2 Transcript, 8 May 2014, Brisbane, PN379–PN383.
3 Transcript, 8 May 2014, Brisbane, PN96-PN101.
4 Fair Work Act 2009, s.400(1).
5 [2010] FWAFB 5343 at [27].
THE FAIR WORK A ISSION THE SEAA
