{"id":904,"date":"2018-05-17T06:18:58","date_gmt":"2018-05-17T06:18:58","guid":{"rendered":"http:\/\/workplaceculturematters.com.au\/?p=904"},"modified":"2018-05-17T06:25:14","modified_gmt":"2018-05-17T06:25:14","slug":"traversing-the-outer-limits-the-fair-work-commissions-jurisdiction-over-the-employment-relationship","status":"publish","type":"post","link":"https:\/\/workn.net.au\/?p=904","title":{"rendered":"Traversing the \u2018Outer Limits\u2019: the Fair Work Commission\u2019s Jurisdiction over the employment relationship"},"content":{"rendered":"

There has always been a distinction between an employment relationship at common law, defined by the terms of the contract of employment, and the employment relationship as defined by the relevant Australian industrial instruments. They co-exist, and at times are synonymous, but not always.\u00a0 The \u2018gap\u2019 between the contractual employment relationship, and the instrumental employment relationship, is generally policed by the Fair Work Commission.\u00a0 In the case of Saeid Khayam v Navitas English Pty Ltd<\/em> [2017] FWCFB 5162, the FWC have arguably left the door ajar to a potential new range of protections for a certain class of employees.<\/p>\n

Unfair Dismissal protection has never been provided from employees who are employed for a \u2018specified period of time<\/em>\u2019 if their employment terminates at the end of that period of time.\u00a0 Thus, employees on fixed term contracts have generally had no legal recourse if their contract is not renewed, even if this is done on \u2018unfairly<\/em>\u2019 to performance or conduct issues.\u00a0 On the other hand, if a fixed term contract provides the employer with an unconditional power to end the contract early (known by the FWC as an \u2018outer limits\u2019 contract), then an employee will typically be protected against early termination if it is unfair, but not against termination of the contract at its expiration date due to the effluxion of time.<\/p>\n

Many industries rely upon \u2018outer limits\u2019 contracts, particularly those dependent on the public purse, or who derive revenue from periodic tendering for grants and funding. Tertiary and vocational education, as well as the community legal sector, are but two examples.\u00a0 In these industries, it is typical to see employees working for many years in one job, subject to a yearly renewal of their \u2018outer limits\u2019 contract.\u00a0 In the event that the contract is not renewed, this has generally not been regarded as falling into the unfair dismissal jurisdiction by the Fair Work Act.\u00a0 Until now. \"4538411<\/a><\/p>\n

The Fair Work Commission in Navitas<\/em> have suggested that the \u2018employment relationship\u2019, may well in these instances, exist above and beyond the mere contract of employment.\u00a0 And this additional part of the employment relationship may bring them into jurisdiction, even if they are terminated at the end date of their outer limits contract.\u00a0 They have not suggested that it does in every case, just that it might<\/span> in some cases.<\/p>\n

For any gluttons for punishment, or industrial law nerds, the decision can be read here<\/a>.\u00a0 Otherwise take my word for it and read on.<\/p>\n

This is not the first time that the \u2018Fair Work\u2019 system has attempted to \u2018plug the gap<\/em>\u2019 between formal contractual relationships and substantive fairness.\u00a0 For example, for a \u2018casual\u2019 employee at common law, each individual engagement is a separate period of employment.\u00a0 They are not \u2018employed\u2019 by the employer between the end of one engagement and the beginning of the next.\u00a0 However, the concept of an employee being a \u2018regular and systematic casual\u2019<\/em>, protected from unfair dismissal, has existed under the Fair Work Act for some time.\u00a0\u00a0 When it comes to dismissal, one of the most common questions I get from employer clients is \u201cThey are a casual, can\u2019t we just not ask them back<\/em>?\u201d\u00a0 The simple answer is \u2018no<\/em>\u2019.\"4859771<\/a><\/p>\n

A number of industries will continue to rely on \u2018outer limits<\/em>\u2019 contracts for a range of operational and economic reasons.\u00a0 However, this decision demonstrates that an \u2018outer limits\u2019 contract may not be the \u2018get out of jail free card<\/em>\u2019 for the unfair dismissal jurisdiction that it once perhaps was.<\/p>\n

Employment lawyers will be left scratching their heads over what effect Navitas<\/em> may have on the employment community, or which class of employees are next in line to be squeezed into the jurisdiction by the FWC.\u00a0 Meanwhile, the best advice I can give to employers is to do whatever possible to treat all of your employees with the principles of fairness,* irrespective of their contractual status, and none of the above is likely to be an issue.<\/p>\n

*For a handy \u2018checklist\u2019 on the meaning of \u2018fairness\u2019, see section 387 of the Fair Work Act 2009<\/a> (Cth).<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

There has always been a distinction between an employment relationship at common law, defined by the terms of the contract of employment, and the employment relationship as defined by the relevant Australian industrial instruments. They co-exist, and at times are synonymous, but not always.\u00a0 The \u2018gap\u2019 between the contractual employment relationship, and the instrumental employment […]<\/p>\n","protected":false},"author":1,"featured_media":905,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[236],"tags":[],"_links":{"self":[{"href":"https:\/\/workn.net.au\/index.php?rest_route=\/wp\/v2\/posts\/904"}],"collection":[{"href":"https:\/\/workn.net.au\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/workn.net.au\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/workn.net.au\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/workn.net.au\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=904"}],"version-history":[{"count":2,"href":"https:\/\/workn.net.au\/index.php?rest_route=\/wp\/v2\/posts\/904\/revisions"}],"predecessor-version":[{"id":908,"href":"https:\/\/workn.net.au\/index.php?rest_route=\/wp\/v2\/posts\/904\/revisions\/908"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/workn.net.au\/index.php?rest_route=\/wp\/v2\/media\/905"}],"wp:attachment":[{"href":"https:\/\/workn.net.au\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=904"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/workn.net.au\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=904"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/workn.net.au\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=904"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}