In the case of Robert Currie v SMA Super Pty Ltd [2013] FWC 3225 Mr Robert Currie claimed he had been unfairly dismissed by SMA Super Pty Ltd (the Employer). Mr Currie's application was dismissed after the Employer raised a jurisdictional objection based on the fact that Mr Currie was not covered by a modern award and thus not protected from unfair dismissal under the Fair Work Act 2009 (Cth) (FW Act).
Facts
The submissions of both parties proceeded on the basis that the only award that could possibly cover Mr Currie's employment was the Banking, Finance and Insurance Award 2010 (the Award). The Employer noted that the highest classification level in the Award is Level 6, which provides:
"Those employed at this level perform a middle managerial role primarily to control the conduct of a part of the employer's business and in which decisions are regularly made and responsibility accepted on matters relating to the administration and conduct of the part o5he business. Those responsible for managing more than 10 people must be classified at this level."
Employer's submissions
The principle submission was that Mr Currie's role was not a 'middle management role' as it involved senior managerial and executive duties well above a Level 6 classification employee. Mr Currie reported directly to the CEO and was involved in decisions on the strategy and direction of the Employer. The principal purpose of Mr Currie's role was to perform executive level functions for the Employer's group of companies.
Mr Nigel Westoby, the Employer's Managing Director and Group Chief Executive Officer, gave evidence that Mr Currie "had that key responsibility to ensure that all the appropriate matters contained within the superannuation - SIS Act as it's described, were, in fact, fulfilled. It doesn't get any higher than that."
At the time of his dismissal Mr Currie's total remuneration package was $143,532, with a base salary of $131, 680.
The Employer submitted that the test to be applied when determining whether or not a modern award applied was, "What was the principal purpose for which an employee was employed?" Citing Hehir v Schweitzer Engineering Laboratories Pty Ltd [2011] FWA 3763, the "principal purpose" test can be addressed by determining what was the most important intention of the employer in requiring the functions of the position to be carried out by the employee. In answering such a question, it is appropriate to examine the job description, the nature of the work performed and any relevant circumstances surrounding the performance of the duties by the employee.
Mr Currie's submissions
Mr Currie indicated that whilst he was a member of both the Investment Committee and the Executive Management Board he had no actual control, as the CEO had the final say on all decisions. However, he was involved in strategic decisions in regards to the superannuation fund he was responsible for, being a pooled investment fund with a value of approximately $100 million and managed on behalf of approximately 17,000 members.
Decision
In dismissing the unfair dismissal application Commissioner Gregory accepted that it was clear from the authorities cited that the principal purpose test should be applied. Based on the application of this test he was satisfied that Mr Currie's role and responsibilities existed at a senior management level and, in all the circumstances, could not be said to fall within the Level 6 classification description contained in the Award. Thus, the Applicant was not covered by a modern award and not a protected person for the purposes of the unfair dismissal provisions of the FW Act.
Factors highlighted as influencing the decision included:
- An employee in a middle management Level 6 classification role is most unlikely to report directly to the CEO or Managing Director.
- A Level 6 employee is almost certainly not a member of the organisation's Executive Management Board or the Investment Committee, or anything with a similar level of seniority and responsibility.
- There is nothing in the classification description in the Award to suggest Level 6 employees have responsibility for important compliance issues in a complicated and changing regulatory environment, nor anything to indicate an intent for the employees to be responsible for strategic and policy responsibilities at a corporate level.
- "A middle managerial role primarily to control the conduct of a part of the employer's business," as described in the Award, would not seem to anticipate or encompass responsibility for the management of around $100 million in funds under administration, held on behalf of 17,000 clients, and the associated responsibilities involved in dealing with fund managers acting as consultants to the fund.
The Commissioner noted that Mr Currie was in receipt of a salary approximately three times the highest level provided for in the Award. While this was not determinative of itself, it added emphasis to the fact that the purpose of Mr Currie's role was associated with the exercise of senior responsibilities within an organisation, in contrast to the middle management roles encompassed within the classification description at the Level 6 classification in the Award.
Lessons for Employers
- Know who is Modern Award covered within your organization and be clear about employees' status from the beginning of employment to avoid wasted costs in defending misconstrued claims.
- Should a previous employee bring an unfair dismissal claim, seek legal advice early so that grounds for jurisdictional objections can be considered as soon as possible to minimize costs incurred.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
