[2015] FWC 2805
The attached document replaces the document previously issued with the above code on 29
April 2015.
Footnotes have been amended.
Sophie Baartz
Associate to DEPUTY PRESIDENT BOOTH
Dated 30 April 2015
1
Fair Work Act 2009
s.394—Unfair dismissal
Adrian Varcoe
v
ACE Insurance Limited T/A Combined Insurance
(U2014/9696)
DEPUTY PRESIDENT BOOTH SYDNEY, 29 APRIL 2015
Application for relief from unfair dismissal - Jurisdictional objection - Extension of time –
Representative error – Application granted
[1] Mr Adrian Varcoe made an application for an unfair dismissal remedy pursuant to s.
394 of the Fair Work Act 2009 on 14 October 2014. In his application he said that his
employment had been terminated by ACE Insurance Limited with effect from 21 September
2014 by way of a letter notifying him that was dated 11 September 2014. The parties agree
that the letter was received by email by Mr Varcoe on the same day. ACE object to his
application on the grounds that it was lodged out of time, that Mr Varcoe is not an employee
of ACE and that he was not dismissed.
[2] Mr Varcoe agrees that his application was lodged out of time. The Act requires that an
application for an unfair dismissal remedy must be made within 21 days after the dismissal
took effect, unless an extension of time is granted by the Commission.1
[3] The matter was listed before me in the Unfair Dismissal Jurisdictional Roster on 20
February 2015 to hear Mr Varcoe’s application for an extension of time. The case was not
concluded and it was listed for further hearing on 8 April 2015.
[4] By permission of the Commission, Mr Varcoe was represented by Mr Thompson of
KP O’Donnell and Associates and ACE were represented by Mr McDonald of Moray &
Agnew Lawyers.
[5] It was conceded by the parties that the jurisdictional objection in relation to Mr
Varcoe’s employment status gives rise to complications in determining the extension of time
application. Nevertheless Mr Varcoe sought to have the extension of time application
determined before his employment status was determined and the respondent agreed to this
course of action.
[6] The parties agree that Mr Varcoe sold ACE insurance products subject to an
Authorised Representative Agreement dated 5 November 2012 between ACE and Solutions 4
People, a company owned by Mr Varcoe. His remuneration was the commission he received
[2015] FWC 2805
DECISION
AUSTRALIA FairWork Commission
[2015] FWC 2805
2
on sales of new insurance policies and on the renewal of existing policies. ACE terminated
this contract effective 21 September 2014 by writing to Mr Varcoe on 11 September 2014.
The question of whether Mr Varcoe sold insurance products as an employee, as he contends,
or as an independent contractor, as contended by ACE, is not the subject of this decision.
[7] The starting point for a consideration of an extension of time application is to
determine the period of time that the application is lodged out of time. In deciding whether to
grant an extension of time the Commission must consider whether there were exceptional
circumstances taking into account, amongst other things, the reason for the delay in lodging
the application.2 The period of time that the Commission must consider the reason for the
delay is the whole of the period that the application was delayed.3
[8] The calculation of the whole of the period that the application was delayed requires:
the date of effect of dismissal to be determined; and
21 days to be counted forward in time with day 1 being the day after the date of
effect of dismissal; and
the balance of the days after the 21st day to be counted up to and including the
date the application was lodged. This is the period of the delay.
[9] The explanation for the delay is the explanation as to why the application was lodged
beyond the 21 day period and the Commission will consider the circumstances from the time
of the dismissal until the lodgement in considering the reason or reasons for the delay.4
[10] The parties agree that the relationship between Mr Varcoe and ACE ended in 2014.
Mr Varcoe says that the relationship ended effective 21 September 2014 by way of the
termination of the Authorised Representative Agreement. ACE contend that it is unclear when
the relationship ended and that it could be anytime between 26 May 2014 and 11 September
2014. They say that on 26 May 2014 a Town Hall meeting announcing the restructure of ACE
took place and the relationship between themselves and Mr Varcoe might have ended then.
Citing a case before Senior Deputy President Callaghan5, who considered the termination of
another ACE Insurance salesperson, ACE also say that it is significant when Mr Varcoe last
worked. They say he ‘really stopped doing any work, other than picking up a few
commissions from people who were renewing policies, during the period since 26 May”.6
They say that the latest date that the relationship ended was 11 September 2014 when Mr
Varcoe received the letter terminating the Authorised Representative Agreement.
[11] The question of when an employment relationship ends has been the subject of
consideration of this Commission. While I am not determining whether Mr Varcoe was in an
employment relationship with ACE, I will nevertheless consider the question of when the
relationship ended in the light of some of the principles that have been previously applied.
[12] A dismissal does not take effect unless and until it is communicated to the employee
who is being dismissed.7
[13] Mr Varcoe attended a Town Hall meeting on 26 May 2014 during which the
restructure of ACE was announced and explained. I conclude that he was made aware at that
time of the inevitability of the relationship ending but that this was not the occasion of his
[2015] FWC 2805
3
dismissal. The evidence is that the announcement was made to an audience of insurance
representatives whose relationship with ACE was ended sequentially over the coming months
in what was described as the roll out of the new model. Although Mr Varcoe was in the
audience this announcement did not end his relationship with ACE. It merely foreshadowed
it. Mr Varcoe would not have been able to make a valid application for an unfair dismissal
remedy on the strength of this announcement.8
[14] In Evan McNeilly v ACE Insurance Limited T/A Combined Insurance, Senior Deputy
President Callaghan9 took into account when Mr McNeilly, the Applicant in that case,
stopped his normal insurance writing arrangements for ACE. However in that case the period
of time that he considered followed Mr McNeilly receiving a letter dated 27 June 2014
terminating his contract with ACE. Like Mr Varcoe, Mr McNeilly also attended information
sessions about changes to the ACE structure in May. Mr McNeilly also attended a meeting on
27 June 2014, coinciding with the date of his letter. It was in this context that Senior Deputy
President O’Callaghan found that Mr McNeilly’s relationship with ACE ended on 27 June
2014. Mr Varcoe gave evidence that he continued to sell ACE insurance policies after the
town hall meeting in May up to his termination in September. Mr Antouny, Field Accountant
and Data Entry Manager for the Combined Insurance Division of ACE, gave evidence that Mr
Varcoe sold one new insurance policy on 6 August and made five policy renewals between 26
May and 21 September 2015. I consider that Mr Varcoe’s conduct is consistent with an
ongoing relationship during this period.
[15] Where payment in lieu of notice is made the dismissal usually takes effect
immediately. Where the notice period is worked the dismissal usually takes effect at the
expiry of the notice period. This is because the date of effect of dismissal is the date the
employment relationship comes to an end.10
[16] The parties agree that ACE emailed a letter dated 11 September 2014 to Mr Varcoe on
the same day and that he received it that day. That letter contained the following:
“This letter is to confirm that your Authorised Representatives Standard Contract
dated 5 November 2012 (Agreement) with Your Choice Division of Combined
Insurance a division of ACE Insurance Limited (Company) has been terminated under
clause 15 (a) of that Agreement effective 21st September 2014.”
[17] There was no payment in lieu made to Mr Varcoe as his remuneration took the form of
commission on the sale of insurance products. Mr Antouny, a witness for ACE said in
evidence that Mr Varcoe was entitled to continue to sell these products up to 21 September
2014 but not after that date.11 This is analogous to an employee working out their notice. Mr
Antouny also gave evidence that the last new insurance policy that Mr Varcoe sold was sold
on 6 August 2015. He said that Mr Varcoe had also achieved the renewal of existing policies
(a process that involved a meeting with the client) but he was unable to say when the last one
of these renewals was achieved. This evidence is not inconsistent with the relationship
between Mr Varcoe and ACE being maintained up to 21 September 2014. In his evidence Mr
Varcoe said that he regarded himself as having been dismissed from 21 September 2014.12 In
all the circumstances I conclude that for the purposes of s.394(2)(a) of the Act the date of
effect of dismissal was 21 September 2014.
[18] To have been within time Mr Varcoe would have had to have lodged his application
on 13 October 2015. This is 22 days from the date of effect of dismissal but as 12 October
[2015] FWC 2805
4
was a Sunday the next day, Monday 13 October 2014, is taken the be the last day for
lodgement. Mr Varcoe’s application was lodged by his solicitor on 14 October 2015, one day
out of time.
[19] I note that the length of the delay is not of itself material to the consideration of the
whether there are exceptional circumstances.13
[20] Mr Varcoe has the onus to demonstrate that an extension of time ought to be granted.
The Act makes it clear that an extension of time may (my emphasis) be granted by the
Commission if there are exceptional circumstances, that is, the judgement to be made is still
the Commission’s to make taking into account all the circumstances. A finding of exceptional
circumstances has been described as the “jurisdictional gateway” for the exercise of the
Commission’s discretion.14
[21] In considering whether there are exceptional circumstances the Act requires that I
consider the following:
(a) the reason for the delay; and
(b) whether the person first became aware of the dismissal after it had taken effect;
and
(c) any action taken by the person to dispute the dismissal; and
(d) prejudice to the employer (including prejudice caused by the delay); and
(e) the merits of the application; and
(f) fairness as between the person and other persons in a similar position 15
[22] Exceptional circumstances are circumstances that are out of the ordinary course,
unusual, special, or uncommon but they need not be unique, unprecedented, or very rare.
Circumstances will not be exceptional if they are regularly, routinely or normally encountered
and may be a single exceptional matter or a combination of exceptional factors or a
combination of ordinary factors when taken together are exceptional.16
[23] I will address each of these factors in turn before deciding whether they reveal
exceptional circumstances and, if so, whether I should exercise my discretion to extend the
time for Mr Varcoe to lodge his application.
(a) the reason for the delay
[24] Mr Thomson submits that the delay was a consequence of “representative error” in
that KP O’Donnell and Associates was instructed by Mr Varcoe to lodge the application and
failed to do so in time.
[25] Mr Varcoe lives in Jiggi, a country town near Lismore in NSW. KP O’Donnell are
located in North Sydney, in metropolitan NSW.
[2015] FWC 2805
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[26] Mr Thompson’s evidence, which I accept, was that Mr Varcoe contacted the firm by
telephone on 4 September to inquire about lodging an unfair dismissal application as he was
anticipating his dismissal. Some short time after this contact KP O’Donnell sent Mr Varcoe a
blank form to complete and a request for funds to be provided to the firm to initiate the
engagement. The firm was next in contact with Mr Varcoe when they received the completed
form and a cheque from him on Thursday 9 October 2014. The communication had been sent
by Mr Varcoe on 7 October 2015. In order to commence the engagement they required the
cheque to be cleared. Mr Thompson was aware that the last day for lodgement of Mr Varcoe’s
application was Monday 13 October so he arranged for an expedited clearance of the cheque
such that funds were received by KP O’Donnell on Friday 10 October 2015. Mr Thompson
gave evidence that he was in a meeting with his colleagues on Tuesday 14 October 2015
when one of them advised him that Mr Varcoe’s application had not been lodged. The
application was prepared that morning (he cannot recall whether by him or a colleague) and
lodged at 1.52pm the same day. Mr Varcoe’s evidence is that he expected the application to
be lodged by the due date and to be informed of any hearings or other information that he
needed to supply for that purpose.17
[27] Mr Thompson’s evidence is that he takes complete responsibility for the oversight and
is very sorry. He submits that the Commission should regard Mr Varcoe as blameless in the
situation, that this representative error is an exceptional circumstance and the Commission
should grant Mr Varcoe’s application for an extension of time.
[28] ACE contend that this does not constitute representative error and is not an
exceptional circumstance. They say because Mr Varcoe did not instruct KP O’Donnell until
the cheque cleared on 10 October, very close to the expiry of the 21 day period, that it was his
conduct that was the reason for the delay. They submit that “the real reason for the delay is
the Applicant’s lack of diligence in pursuing his claim”.18
[29] Circumstances of representative error in applications for extension of time have been
the subject of previous consideration of this Commission. Depending on the particular
circumstances, the Commission has held that a representative error may be a sufficient reason
for extension of time. A distinction should be drawn between delay properly apportioned to a
representative where the applicant is blameless where the delay is occasioned by the conduct
of the applicant. This conduct is a central consideration in deciding whether representative
error provides an acceptable explanation for the delay in filing the application. Error by the
applicant’s representative is only one of a number of factors to be considered in deciding
whether or not an out of time application should be accepted.19
[30] Mr Varcoe’s explanation for not formally engaging KP O’Donnell until he sent his
letter of 7 October is that he had to source the funds to engage the solicitor.20 Mr Thompson
submits that Mr Varcoe did formally engage KP O’Donnell in time to lodge his application
within 21 days, that KP O’Donnell were “fully conscious” of the deadline and “the fact that
we didn’t meet it was nothing to do with Mr Varcoe at all”.21
[31] I agree with Mr Thompson that KP O’Donnell had sufficient time to prepare and lodge
Mr Varcoe’s application. The Form F2 application for Unfair Dismissal remedy is not a
complex form. Mr Thompson said that the application could easily be prepared in half a day.
In my view, and taking into account the actual application that was lodged, I would consider
that it could have been prepared in an hour. I accept that it was KP O’Donnell’s lapse, not Mr
Varcoe’s, and that the time he took to engage and instruct KP O’Donnell was not the reason
[2015] FWC 2805
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for the delay. The reason for the delay was KP O’Donnell’s oversight in not preparing and
lodging the application in time. Such an occurrence in a firm of solicitors is probably not
unique, unprecedented, or very rare but neither is it regularly, routinely or normally
encountered. I consider that it is out of the ordinary course, unusual, special, or uncommon,
that is, exceptional, for such an oversight to occur. This weighs in favour of granting Mr
Varcoe’s application.
[32] ACE also submit that the Commission cannot be satisfied that this is a case of
representative error because some of the submissions made and evidence given by Mr
Thompson was based on hearsay or emails that were not produced. I am satisfied that the
factual basis for my conclusion rests upon dates and actions that are either agreed between the
parties, emerge from direct evidence that I accept, or is clear on the face of the material before
me.
(b) whether the person first became aware of the dismissal after it had taken effect
Mr Varcoe became aware that his relationship with ACE had ended on 11 September 2014
when he received the letter terminating the contract. He did not become aware of it after it
took effect. This factor is a neutral consideration in the exercise of my discretion.
(c) any action taken by the person to dispute the dismissal
Mr Varcoe contacted KP O’Donnell and Associates on 4 September 2014 and set in train the
process that culminated in his, albeit late, lodgement of his application. He did not otherwise
seek to dispute his dismissal. This factor is a neutral consideration in the exercise of my
discretion.
(d) prejudice to the employer (including prejudice caused by the delay)
ACE contend that as the applicant was not an employee and as the application is invalid and
entirely misplaced they are prejudiced. They also submit prejudice arises because of the
transition to a new business model. I accept that if I extend the time for Mr Varcoe’s
application to be made that ACE will have to address his employment status before having to
answer his allegation of unfair dismissal. However this is no more than they would have had
to contend with had Mr Varcoe’s application been lodged within time. I accept their
submission that the absence of prejudice is not unusual and in this case should be given
limited weight. In this case it does not weigh for or against an extension of time.
(e) the merits of the application
The parties’ submissions in relation to the merits of Mr Varcoe’s unfair dismissal application
were limited to reference to the question of his employment status. As this was explicitly, by
agreement, not the subject of my consideration, the discussion of the merits of this argument
were necessarily constrained. I cannot form a view as to the prospects of Mr Varcoe’s
application and I regard this factor as neutral in the exercise of my discretion.
(f) fairness as between the person and other persons in a similar position
ACE contend that to grant Mr Varcoe’s application would be unfair to other persons in a
similar position as Mr Varcoe, whose relationship with ACE has ended arising from the
[2015] FWC 2805
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recent change in business model. In particular they cite Mr McNeilly whose case was
discussed above. Mr McNeilly was denied an extension of time. The circumstances of Mr
McNeilly and Mr Varcoe are different and I do not consider that fairness dictates that Mr
Varcoe should be treated similarly to Mr McNeilly. I regard this factor as neutral in the
exercise of my discretion.
[33] In conclusion I consider that the reason for the delay in lodging Mr Varcoe’s
application was representative error and in this case it does constitute an exceptional
circumstance. Taking into account all of the circumstances I have decided to exercise my
discretion in favour of granting Mr Varcoe’s application for an extension of time. An order
will issue with this decision and the application will be listed for directions in relation to the
jurisdictional objection concerning his employment status.
DEPUTY PRESIDENT
Appearances:
N Thomson, KP O’Donnell & Associates, for Mr Adrian Varcoe
T McDonald, Moray & Agnew Lawyers, for ACE Insurance Limited T/A Combined
Insurance
Hearing details:
2015.
Sydney:
20 February.
8 April.
1 Section. 392(2) Fair Work Act 2009.
2 Section 394(3)(a) Fair Work Act 2009.
3 C Ozsoy v Monstamac Industries Pty Ltd [2014] FWCFB 2149 at [31]; Cheval Properties Pty Ltd t/as Penrith Hotel Motel v
Janette Smithers [2010] FWAFB 7251.
4 C Ozsoy v Monstamac Industries Pty Ltd [2014] FWCFB 2149 at [31]; Cheval Properties Pty Ltd t/as Penrith Hotel Motel v
Janette Smithers [2010] FWCFB 7251; Mitchell Shaw v Australia and New Zealand Banking Group Limited T/A ANZ Bank
[2015] FWCFB 287
5 Evan McNeilly v ACE Insurance Limited T/A Combined Insurance [2014] FWC 6814.
6 PN 994.
----- -- L COMMISSION THE SEAL OF THE HE FAIR WORK
[2015] FWC 2805
8
7 Burns v Aboriginal Legal Service of Western Australia (Inc) (unreported, AIRCFB, Williams SDP, Acton SDP, Gregor C,
21 November 2000) Print T3496 at [24].
8 Mr Peter Mihajlovic v Lifeline Macarthur [2014] FWCFB 1070 at [13].
9 [2014] FWC 6814.
10 Siagian v Sanel Pty Ltd (1994) 122 ALR 333 at [355]; Mr Peter Mihajlovic v Lifeline Macarthur [2013] FWC 9804 at [8];
Mr Peter Mihajlovic v Lifeline Macarthur [2014] FWCFB 1070 at [12] and [13].
11 PN 916-917.
12 PN203.
13 C Ozsoy v Monstamac Industries Pty Ltd [2014] FWCFB 2149.
14 Carolyn Baramilis v Residual Property Pty Ltd [2015] FWC 1052.
15 Section 394(3)(a) to (f) Fair Work Act 2009.
16 Baker v The Queen (2004) 223 CLR 513 at [173]; Ho v Professional Services Review Committee No 295 [2007] FCA 388;
Cheyne Leanne Nulty v Blue Star Group Pty Ltd [2011] FWAFB 975.
17 PN255.
18 Respondent’s Outline of Submissions 17 December 2014.
19 Clark v Ringwood Private Hospital (1997) 74 IR 413; Davidson v Aboriginal and Islander Child Care Agency Print
Q0784; (1998) 105 IR 1; Patrick Morgan McConnell v A & PM Fornataro T/A Tony’s Plumbing Service [2011] FWAFB
466.
20 PN502, 510, 528.
21 PN949,950.
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