1
Fair Work Act 2009
s.394—Unfair dismissal
Philip Moyle
v
MSS Security Pty Ltd
(U2015/12036)
SENIOR DEPUTY PRESIDENT
O’CALLAGHAN
ADELAIDE, 8 DECEMBER 2015
Application for relief from unfair dismissal – meaning of dismissal – employee remains
employed – repudiation of contract – dispute able to be dealt with under Enterprise
Agreement – no jurisdiction.
[1] On 29 September 2015 United Voice lodged an application on behalf of Mr Moyle
pursuant to s.394 of the Fair Work Act 2009 (the FW Act). The application advised that
Mr Moyle had been dismissed by MSS Pty Ltd (MSS), when he was relocated to a different
site and advised of a reduction in his salary and classification. The application contended that
the employment termination took effect from 9 September 2015.
[2] In its Employers Response (Form F3) MSS contended that Mr Moyle had not been
dismissed and remains an employee. Furthermore, the MSS position was that there was no
significant reduction in remuneration and that, at the time the application was lodged,
Mr Moyle remained classified at the same level as a consequence of a request to this effect
made by United Voice.
[3] Mr Moyle’s application was referred to me for determination. It was the subject of a
Determinative Conference on 4 December 2015. Both parties provided submissions and
material in support of their respective positions. Ms Smith, of United Voice represented
Mr Moyle. Ms Jansen represented MSS.
Background Facts relevant to whether Mr Moyle was dismissed
[4] Mr Moyle commenced employment with MSS in 2013. He was classified as a Level 5
Security Officer under the Security Services Industry Award 2010 (the Award) and worked at
the Lyell McEwin Hospital.
[5] On 28 August 2015, MSS advised Mr Moyle that he would be transferred to either the
Royal Adelaide Hospital or James Nash House. These transfer arrangements involved
differing shifts. The MSS position is that the transfer arrangements reflected an ordinary and
customary practice within its business and involved a number of its personnel. I note that this
issue is disputed between the parties. I also note that MSS assert that the transfer was not a
[2015] FWC 8330 [Note: An appeal pursuant to s.604 (C2015/7670) was
lodged against this decision - refer to Full Bench decision dated 3 February
2016 [[2016] FWCFB 372] for result of appeal.]
DECISION
E AUSTRALIA FairWork Commission
https://www.fwc.gov.au/documents/decisionssigned/html/2016FWCFB372.htm
[2015] FWC 8330
2
performance-based decision. Mr Moyle’s position is that this change constituted a demotion
such that his employment was terminated.
[6] On 1 September 2015 Mr Moyle advised that he preferred the James Nash House site.
He was then provided with a roster commencing on 9 September 2015. Mr Moyle has
continued to work in accordance with those rostering arrangements.
[7] Mr Moyle expressed concern about what he regarded as a demotion to United Voice.
On 18 September 2015 United Voice wrote to Ms Jansen of MSS on behalf of Mr Moyle and
expressed concern over the extent to which MSS had properly consulted in this matter. This
correspondence confirmed that Mr Moyle was willing to move to James Nash House but
required that MSS attempt to “mitigate the adverse effects of a change in grade.”1 This
correspondence advised that, if MSS did not respond or do not consider Mr Moyle’s request,
an unfair dismissal claim might be pursued.
[8] MSS responded to this correspondence on 23 September 2015 and advised that it
would continue to pay Mr Moyle at the Level 5 classification until 4 October 2015. This
advice2 also confirmed that MSS refused to mitigate the loss of night shift loadings as it
asserted that Mr Moyle “had the choice to continue working on a day/night shift roster and
made the decision to move to a day shift only roster for personal reasons.”3
[9] Mr Moyle has continued to work for MSS at James Nash House. He has been paid at
the Level 3 rate. The Award Level 5 rate is $21.33 per hour and the Award Level 3 rate is
$20.32 per hour.
The Jurisdictional issue
[10] The initial issue goes to whether or not Mr Moyle has been dismissed. Section 385
establishes that dismissal is an unequivocal prerequisite of any unfair dismissal finding.
Further, s.386 defines a dismissal. This section states:
“386 Meaning of dismissed
(1) A person has been dismissed if:
(a) the person’s employment with his or her employer has been terminated on the
employer’s initiative; or
(b) the person has resigned from his or her employment, but was forced to do so
because of conduct, or a course of conduct, engaged in by his or her employer.
(2) However, a person has not been dismissed if:
(a) the person was employed under a contract of employment for a specified period of
time, for a specified task, or for the duration of a specified season, and the
employment has terminated at the end of the period, on completion of the task, or at
the end of the season; or
(b) the person was an employee:
[2015] FWC 8330
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(i) to whom a training arrangement applied; and
(ii) whose employment was for a specified period of time or was, for any reason,
limited to the duration of the training arrangement;
and the employment has terminated at the end of the training arrangement; or
(c) the person was demoted in employment but:
(i) the demotion does not involve a significant reduction in his or her remuneration or
duties; and
(ii) he or she remains employed with the employer that effected the demotion.
(3) Subsection (2) does not apply to a person employed under a contract of a kind
referred to in paragraph (2)(a) if a substantial purpose of the employment of the person
under a contract of that kind is, or was at the time of the person’s employment, to
avoid the employer’s obligations under this Part.”
[11] Mr Moyle’s position was that the decision to reduce his classification from Level 5 to
Level 3 and to allocate him to a roster which did not involve the same level of night shift
work constituted a dismissal and that his current position represents substantially different and
reduced duties. Mr Moyle’s submission was that he had only continued to undertake the
diminished duties under protest such that the employment contract under which he previously
worked had been terminated at the initiative of the employer so that he was able to pursue an
application of this nature. Mr Moyle’s evidence was that:
“I am of the view that my demotion was unfair. I have lost remuneration and I have lost
all my supervisory duties. There was nothing I did that was wrong.”4
[12] The MSS position was that the change in Mr Moyle’s allocated duties did not
represent a significant reduction in duties given the terms of the Award and the conditions
under which he worked. MSS asserted that the reduction in remuneration and changing
classification could not be regarded as significant. Further, MSS asserted that the loss of shift
loadings previously applicable to Mr Moyle reflected his decision not to pursue a work
allocation which brought with it the same shift arrangements that previously applied. Finally,
MSS asserted that, because Mr Moyle remains an employee, he has not been dismissed so that
the Fair Work Commission (the FWC) lacks the jurisdiction to further consider the
application. By extension, MSS contended that any residual concerns which Mr Moyle may
have about the work allocated to him, his classification and/or access to shift loadings should
be addressed consistent with the dispute resolution provisions (clause 9) of the Award.
The Evidence
[13] Mr Moyle’s evidence went to the circumstances of the commencement of his
employment and the extent to which, until 9 September 2015, he understood he was classified
as a Level 5 Security Officer under the Award and was a Team Leader. Mr Moyle detailed his
understanding of the MSS transfer requirements and the limited choice given to him in this
respect. He detailed the basis upon which he sought to dispute this issue in the following
terms:
[2015] FWC 8330
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“On 28 August 2015 I attended the second day of the two day training. I met with
Service Support Manager, Mr Mick Leet and Ms Jansen. In this meeting, Ms Jansen
said words to the effect, “you will be transferred to a different worksite, you may
transfer to either the Royal Adelaide Hospital or James Nash House. The move will
involve a transfer to Level 3: I cannot recall the exact conversation however the reason
given for the transfer was that it was a result of the customary and ordinary turnover of
staff. I asked, “could I take time to consider this?”. I was given 7 days to make the
decision.
On Monday 31 August 2015 I contacted Mr Marthenis via telephone. I cannot recall
precisely what I said but I contacted him with the intention of advising him of my
option and said words to the effect that, “I will move to James Nash House”.
On the same day I contacted United Voice and spoke with Member’s Rights Centre
Official Bronwen Davies regarding the demotion. I asked what I could do. I was
advised to speak with my employer about what steps they intended to take to mitigate
my loss.”5
[14] In his evidence, Mr Moyle acknowledged that he had agreed in 2010, 2012 and 2015
with the Security Officer Standing Instructions which detailed rules, policies and procedures.6
[15] Mr Marthenis is the Business Manager (Healthcare Services) for MSS. His evidence
went to common arrangements for the transfer of employees and payment arrangements in
these circumstances. His evidence was that SA Health Management had requested that
security employees be rotated so as to be exposed to different environments within health.7
[16] Mr Marthenis’ evidence was that Mr Moyle was given two options for transferred
working arrangements and was transferred to his preferred location which involved reduced
shiftwork opportunities. Following correspondence from United Voice, Mr Marthenis agreed
to pay Mr Moyle at the Level 5 for a further month to assist him with the transition of pay
rate.
Findings
[17] The plain words of s.386(2)(c) must be construed such that a demotion in employment
can only constitute dismissal for the purposes of Division 3 of Part 3-2 of the FW Act if the
employee does not remain employed by that employer and the demotion involves either a
significant reduction in the employee’s remuneration or duties. This section of the FW Act
does not provide that a reduction in either duties or remuneration is sufficient, of itself, to
constitute a dismissal. A mandatory requirement is that the employee no longer remains
employed. That approach is consistent with the approach in the Full Bench decision in Barkla
v G4S Custodial Services Pty Ltd.8
[18] The Full Bench decision in Charlton v Eastern Australian Airlines Pty Ltd9 provides
some further insight. I note that this decision was reached under a legislative regime which at
that time specifically incorporated a reference to the Termination of Employment Convention.
In that matter the Full Bench addressed the history of what is now s.386(2)(c). The Full Bench
stated:
[2015] FWC 8330
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“[32] Consistent with the decision in Boo Hwa Chan, a termination of employment
occurs when a contract of employment is terminated. This necessarily occurs when the
employment relationship comes to an end. However, it can also occur even though the
employment relationship continues. Where a contract of employment has been
terminated, but the employment relationship continues, this will be because a new
contract of employment has come into existence. Therefore, whether the appellant’s
demotion involved his employment being “terminated by the employer” within the
meaning of s.170CE turns on whether his contract of employment was terminated
notwithstanding the continuing employment relationship. This question is answered by
reference to general law principles relating to the termination of contracts of
employment, unconstrained by the Convention.
[33] The question of when a demotion constitutes a termination of employment within
general law principles relating to termination of contracts of employment,
unconstrained by the Convention, was given careful consideration by the Full Court of
the Supreme Court of South Australia in Advertiser Newspapers Pty Ltd v IRC &
Grivell. We respectfully adopt that analysis. Although the decision related to a
different statutory context, that context required a consideration of general law
principles that are equally applicable in the present case.
[34] Unless the contract of employment or an applicable award or certified/workplace
agreement authorises an employer to demote an employee, a demotion, not agreed to
by the employee, that involves a significant reduction in remuneration will amount to a
repudiation of the contract of employment. If that repudiation is accepted, either
expressly or by conduct, then the contract of employment is terminated. If, in such
circumstances, the demoted employee then remains in employment with the employer,
this occurs pursuant to a new contract of employment in respect of the demoted
position. It may be noted that where the employment continues with the employee
allegedly acquiescing in a reduction in salary or other terms of employment, difficult
questions may arise as to whether the continued employment involves the continuation
of the original contract of employment (but with the employer breaching that contract
by paying the reduced salary), a consensual variation of the terms of the original
contract or the termination of the original contract and a substitution of a new contract
of employment.” (references removed)
[19] I do not think that Mr Moyle was dismissed for the reasons I have set out below.
[20] I have discounted the loss of shift premiums as a relevant factor in that this reflected
Mr Moyle’s preference to undertake work at James Nash House knowing that it involved
reduced shiftwork. The evidence of Mr Marthenis was not disputed by Mr Moyle. Mr
Marthenis’ evidence was that:
“On the 28th August 2015 I requested by Service Support Manager, Mick Leet, speak to
Phil Moyle and advised him that he had been selected for site transfer as per the memo
distributed on 29th July 2015. (sic)
I asked him to provide Phil Moyle with two options of roles to transfer to; one being at
The Royal Adelaide Hospital, with a continuing roster patter as he had been working,
of 2 days then 2 nights on, followed by 4 days off. The second option being a role at
[2015] FWC 8330
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James Nash House, which also has a roster of 4 days on, 4 days off, however no night
shift is included in this role.”10
[21] Mr Moyle’s evidence was that he agreed that he elected to transfer to James Nash
House.11 Under the Award, shift premiums are payable with respect to designated shifts which
can only apply where an employee’s working arrangements establish an entitlement to those
shift premiums.
[22] Since 4 October 2015 Mr Moyle has received a base wage rate which is approximately
$1 per hour less than that which previously applied. I do not consider that this reduction in
remuneration can be regarded as significant for the purposes of s.386(2)(c)(i). That reduction
amounts to less than 5%.
[23] In terms of the duties undertaken by Mr Moyle, there is nothing in the employment
arrangements under which Mr Moyle was engaged which determined that he was specifically
engaged at a given classification level. Further I do not consider that there is anything in the
Award that requires that Mr Moyle must be paid as a Level 5, having been so classified at a
particular site. Clause 13.1 of the Award states:
“13. Classifications
13.1 Classifications are set out in Schedule C—Classifications. An employee
performing work falling within the classification descriptions in Schedule C must be
employed in a classification in Schedule C.”
[24] The Award classification descriptors define the various different levels, and
particularly Levels 3-5 on the basis of the specific tasks undertaken. I do not consider that
there is anything in the Award which prohibits MSS from classifying Mr Moyle at a lower
level if this reflects the position requirements. In this respect, Mr Moyle’s position is
analogous to the circumstances considered by a Full Bench in Gorczyca v RMIT University.12
[25] In terms of the duties associated with Mr Moyle’s work at James Nash House, I have
noted that the Level 5 classification description specifically stipulates that a Security Officer
Level 5 may be required to perform the duties of security officers at Levels 1, 2, 3 and 4
provided that such duties are not designed to promote deskilling.13 Further, Mr Moyle
acknowledged14 that he had endorsed the various iterations of the Security Officer Standing
Instructions. There was no dispute that these instructions refer to Transfer, Location and
Classification in the following terms:
“a. Section 7.5.2 Transfer, Location and Classification
b. As an employee of MSS Security, you are employed as a condition of
employment to perform a wide range of duties at any site at which MSS
Security has a contract to provide services. The business for MSS Security
depends on the hold and performance of such contracts.
c. Your rate of pay and conditions as an employee shall be those applying to the
duties you perform from time to time and may change according to your new
assignments.
[2015] FWC 8330
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d. Section 1.14 Work as Directed.
e. Provided they are qualified and trained to perform the required duties,
employees will accept any work assignment offered to satisfy MSS contractual
obligations. They must be prepared to work at any MSS or client’s premises,
sites, or place of duty as may be directed by MSS management.”15
[26] In this context I am not satisfied that the allocation of Level 3 duties to Mr Moyle can
be properly described as a significant reduction in his duties. It simply involves the allocation
of security officer work which does not meet the definition set out for Level 5.
[27] I have adopted the approach set out in Whittaker v Unisys Australia Pty Ltd16 where
the Court considered whether the employer’s conduct represented a repudiation of the
employment contract. In that matter, Ross J stated:
“34 Whether there has been a repudiation in a particular case is a question of fact.
35 Not every breach of contract is a repudiation and repudiatory conduct is not to be
inferred lightly. Repudiation may be evidenced by a single act or by an accumulation
of conduct in circumstances where no individual act on its own constitutes a
repudiation.
36 A repudiatory breach does not automatically terminate the contract but confers an
elective right of termination on the innocent party.” (references removed)
[28] I note at the outset that Mr Moyle’s circumstances differ substantially from those
addressed in Whittaker. Mr Whittaker did not undertake the revised role allocated to him. He
refused that role such that his employment came to an end.
[29] I have accepted Mr Moyle’s advice that, on 4 September 2015 he asked United Voice
to dispute his demotion and request mitigation of his losses.17 There is nothing to indicate to
me that Mr Moyle confirmed to MSS that he regarded his employment contract to be at an
end. His evidence was that:
“I moved to James Nash House on 9 September 2015. I have performed duties as a team
member within the Level 3 classification since this time.”18
[30] Further, I am not satisfied that Mr Moyle actually specified a form of protest to MSS
relative to either his classification, his pay or his duties. His evidence was that he raised
various issues with MSS management on 27 August 2015 but did not protest at his transfer
arrangements.19 To the extent that Mr Moyle agrees that he raised a protest relative to his
employment arrangements with United Voice, the correspondence sent to MSS on his behalf20
refers to an allegation that the circumstances of Mr Moyle’s transfer and pay reduction “may
constitute a termination of our members’ employment”. This same correspondence requests
that “MSS attempts to mitigate the adverse effects of a change in grade.” MSS responded to
this correspondence and agreed to maintain Mr Moyle’s hourly rate for a further four weeks.
There is nothing to indicate that Mr Moyle regarded himself as dismissed. He has continued
to work and the MSS position is that it only became aware of his position that he had been
dismissed when it received this application. Consequently, notwithstanding that I do not
[2015] FWC 8330
8
consider that the employment contract had been repudiated by MSS, there is no evidence that
Mr Moyle regarded his employment as having been terminated in any event.
[31] The Award dispute resolution provisions (Clause 9) provide the capacity for a dispute
relative to inappropriate classification levels to be addressed. That dispute resolution process
then provides the capacity for an unresolved issue to be referred to the Fair Work
Commission. I consider that this option was, and remains open to Mr Moyle. Indeed, it is
consistent with his view that his demotion was unfair21 as distinct from articulation of an
opinion that this demotion severed the employment relationship. Absent any clear
articulation of Mr Moyle’s position such that he regarded the work and site reallocation
represented some form of repudiation of the employment contract, and consequently left
MSS’s employment, Mr Moyle’s circumstances simply appear to be consistent with other
employees who may dispute all, or the nature of some of the duties, or pay rates allocated to
them. Unless there is clear evidence of acceptance of the repudiation of employment contract
by an employee, a dispute over the allocation of duties is a matter which should be resolved
by the parties or, if this is not possible, through determination under the appropriate industrial
instrument. Whether that determination ultimately gives rise to the capacity to pursue an
unfair dismissal application may be a different issue.
[32] The use of the unfair dismissal jurisdiction to determine, at this stage, a dispute over
the allocation of duties to Mr Moyle appears inherently inconsistent with the plain words of
s.386(2)(c). Where an employee remains as such and the capacity exists for resolution of a
disagreement over the duties allocated to that employee, the concept of repudiation of the
employment contract appears inherently difficult to invoke.
[33] Mr Moyle may have remained employed with MSS reluctantly, but there is nothing
unique or extraordinary about that. The plain provisions of s.386(2)(c) indicate that he has not
been dismissed at the present time.
[34] Given the conclusions I have reached in this respect it is not necessary that I give
further consideration to the extent to which, at the time the application was made Mr Moyle
was still in receipt of his Level 5 classification rate of pay. In Mihajlovic Lifeline Macarthur22
a Full Bench determined that there was a discretion available to the FWC to accept an unfair
dismissal application made before and employment termination took effect. In this instance I
do not consider that employment termination took effect at all so that the question of an
exercise the discretion to accept a premature unfair dismissal application simply does not arise
in these circumstances.
[35] Consequently I have concluded that Mr Moyle has not been dismissed.
[36] Section 385 states:
“385 What is an unfair dismissal
A person has been unfairly dismissed if the FWC is satisfied that:
(a) the person has been dismissed; and
(b) the dismissal was harsh, unjust or unreasonable; and
[2015] FWC 8330
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(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.
Note: For the definition of consistent with the Small Business Fair Dismissal Code:
see section 388.”
[37] Mr Moyle cannot be unfairly dismissed if his circumstances do not meet the definition
of “dismissed”. In this situation I am not satisfied that there is any capacity for him to pursue
this application further. The application is dismissed on this basis. An Order (PR574621) to
this effect will be issued.
Appearances:
L Smith for the Applicant.
R Jansen for the Respondent.
Hearing details:
2015.
Adelaide:
December 4.
Printed by authority of the Commonwealth Government Printer
Price code C, PR574620
1 Exhibit A1, Annexure A
2 Exhibit R2, Attachment 6
3 Exhibit R2, Attachment 6
4 Exhibit A2, para 18
5 Exhibit A2, paras 11 - 13
6 Transcript sound recording, 10:48 am, 4 December 2015
7 Exhibit R2, para 9
8 [2011] FWAFB 3769
9 (2006) 154 IR 239
10 Exhibit R2, paras 12 and 13
11 Exhibit A2, para 12
12 PR922414, 12 September 2002
HIE PAIN WORK CO FAIR SIDENT ALLA FOISSHA EAL O Ht SENIOR DEPUTY
[2015] FWC 8330
10
13 Security Services Industry Award 2010, Schedule C
14 Transcript sound recording, 10:48 am, 4 December 2015
15 Exhibit R1, para 34
16 [2010] VSC 9 (29 January 2010)
17 Exhibit A2, para 15
18 Exhibit A2, para 16
19 Transcript sound recording, 10:42 am, 4 December 2015
20 Exhibit R3, Attachment 5
21 see Exhibit A2, para 18
22 [2014] FWCFB 1070
