WESTERN AUSTRALIAN INDUSTRIAL MAGISTRATES COURT

CITATION : 2016 WAIRC 00677

DELIVERED : THURSDAY, 28 JULY 2016

FILE NO. : M 32 OF 2015

CLAIMANT

AND

Success Motors Service Pty Ltd

Respondent

Catchwords : Claim for unpaid wages – Whether the claimant and respondent entered into a contract of employment – Whether there was a breach of the Vehicle Manufacturing, Repair, Services and Retail Award 2010 [MA000089] – Small claims procedure.

Legislation : Fair Work Act 2009

Instruments : Vehicle Manufacturing, Repair, Services and Retail Award 2010 [MA000089]

Result : Claim proven

Representation:

Claimant : In person

Respondent : Mr Yunbo Ji, director of the respondent

REASONS FOR DECISION

1         Mr Jing Tao Sun (the claimant) alleges:

1. that Success Motors Service Pty Ltd (the respondent) employed him as a welder in its panel beating business between 2 April 2013 and 14 August 2013; and
2. that it did not pay him at all during that period.

2         The respondent denies that it employed the claimant.

3         The claimant asserts that the terms and conditions of his employment were regulated by the Vehicle Manufacturing, Repair, Services and Retail Award 2010 [MA000089] (the Award).

Issues

4         The issues to be determined in these proceedings are:

1. Whether the parties entered into a contract of employment; and
2. If so, whether the Award applied to that employment; and
3.  If the Award did apply, whether the claimant was paid in accordance with the Award.

The Claimant’s Case

5         The claimant gave evidence and called three witnesses.

The Claimant’s Evidence

6         The claimant testified that he is a qualified riveter, welder and assembler.

7         In about late March of 2013 he took a vehicle to the respondent’s business for repair having been introduced to that business by a friend. At that time he met the respondent’s managing director, Mr Yunbo Ji (Mr Ji), whom he discovered came from the same province in China.

8         In discussions, Mr Ji asked him what work he was doing. The claimant responded by saying that he was not working because he had recently been retrenched. Mr Ji asked him if he had ever worked in a panel beating shop. The claimant replied that he had done so in China but not in Australia.

9         The claimant alleges that Mr Ji told him that he had purchased several vehicles at auction, but had not had the time to fix them up and that if the claimant had no work he could work for him fixing up those vehicles. It was agreed that the claimant would start working for the respondent on a trial basis to see if he had the necessary skill required. If at the end of the trial period Mr Ji was happy with his work, then the claimant would be permitted to continue working for the respondent. If Mr Ji was not happy, then the claimant would not be employed.

10      The claimant asserts that he successfully completed his trial. There is an internal inconsistency in his evidence about the length of his trial. In evidence, he said that his trial was for two days whereas is his statement produced to the court (exhibit 2), he said that the period of his trial was for five days.

11      In any event, the claimant says that he successfully completed his trial and that Mr Ji agreed to employ him as a panel beater and welder involved in the repair of accident damaged vehicles. Mr Ji gave him two sets of uniforms to wear whilst working at the workshop. He has produced one set (exhibit 4). Thereafter he repaired accident damaged vehicles and carried out other miscellaneous tasks as instructed by Mr Ji.

12      The claimant contends that Mr Ji agreed to pay him 10% of the value of each car that he repaired. Such payment was to be made after the vehicle was sold. He asserts that he worked on about 27 or 28 vehicles each valued in excess of $15,000 and expected to be paid at least $1,000 for each vehicle on which he worked.

13      After having worked for two months without pay he approached Mr Ji for payment. At that time Mr Ji told him that the cars the claimant had repaired had not been sold. He told the claimant that he would be paid as soon as the cars were sold.

14      On 15 August 2013, the claimant again asked Mr Ji for payment. Mr Ji told him that he had no money because the repaired vehicles had not been sold. The claimant was unsatisfied with that and resigned with immediate effect.

15      The chronology of events subsequent to the claimant’s resignation is not entirely clear, however what is clear is that the claimant attended the respondent’s premises on at least two occasions seeking payment. It seems that on the last occasion the claimant and Mr Ji argued and the police were called. The claimant was warned by the police to stay away from the respondent’s premises.

16      On one of the occasions that the claimant attended the respondent’s premises, he took photographs of some of the vehicles that he had worked on. Those photographs are before the court (exhibit 3). Mr Ji takes exception to the claimant’s actions in that regard. He says that the photographs the claimant took, which included photographs of compliance plates, was improper and breached the respondent’s privacy.

17      The claimant asserts that on 23 August 2013 he visited the respondent’s premises and spoke to Mr Ji about payment. At that time Mr Ji refused to pay him saying that the respondent had not made any money but later in the same conversation, asserted that the claimant had never been ‘hired’ and therefore was not owed anything.

18      On 1 September 2013 the claimant, as had been prearranged prior to his resignation, travelled to China and returned to Perth on 16 March 2014. Immediately upon his return he made a complaint to the Fair Work Ombudsman (FWO) who investigated the matter.

19      The claimant asserts that Mr Ji denied knowledge of him to the FWO investigator.

20      The claimant asserts that between 2 April 2013 and 14 August 2013 (19 weeks and four days) he worked 1,121 hours for the respondent. He says that he generally worked between 8:30 am and 6:30 pm Mondays to Saturdays but concedes that on occasions he started work later or finished earlier. Sometimes he finished as late as 9:00 pm and on odd occasions he worked on Sundays. He kept a contemporaneous record of the hours worked. He has produced that record (exhibit 1).

21      The claimant says that he is owed $25,827.84 in unpaid wages. He has calculated his claim using an hourly rate $23.04 which he says was payable to him at the time.

Other Evidence Called by the Claimant

22      The claimant called a number of witnesses. One of the witnesses called, Mr Yonglee Zoe (Mr Zoe) was called for the purpose of giving hearsay evidence. When that became apparent, Mr Zoe was not permitted to give such evidence and was excused. The other witnesses called namely Mr Juang Hai Chen (Mr Chen), Mr Fei Wang (Mr Wang) and Mr Zhen Luo (Mr Luo) were each able to give direct evidence about the matter.

23      Mr Wang was the claimant’s house mate at the material time. He testified that he observed the claimant returning home from work at about 7.00 pm on most evenings.

24      Mr Chen is a former work colleague of the claimant. He testified that he attended the respondent’s premises for the purpose of purchasing a vehicle. He said that he visited the respondent’s premises several times for that purpose and that on each occasion he saw the claimant working in the workshop.

25      The final witness called by the claimant was Mr Luo. Mr Luo is a driving instructor. He testified that he first met the claimant when he taught him how to drive. At the time he was also a customer and friend of Mr Ji. He said that between April 2013 and August 2013 he attended the respondent’s workshop on a regular basis sometimes up to three to four times a week. He saw the claimant working there on each occasion. Sometimes during such visits he spoke to the claimant who informed him about the terms of his remuneration. He thought the arrangement to be ‘interesting’.

26      At the end of August 2013, Mr Luo happened to be at the respondent’s workshop and saw the claimant arrive and heard him ask Mr Ji for his pay. He heard Mr Ji’s response which was initially that he did not have the money to pay him, which later changed to denying that the claimant had worked for the respondent as an employee. He observed the claimant and Mr Ji to argue loudly and the police attend.

Respondent’s Case

27      The respondent relies on the evidence of its director Mr Ji, his daughter and a friend.

Mr Ji’s Evidence

28      Mr Ji denies ever having employed the claimant. He says that at the time he first met the claimant, the claimant had told him that he had lost his job. Mr Ji advised the claimant that as the respondent was moving premises that the claimant could do some odd jobs for him in that move. Mr Ji said that the claimant agreed to that. In return the claimant was given his lunch on days worked plus was paid $300 to $500 in cash per week dependant on what was done.

29      He denies that the claimant worked for the respondent on a full-time basis between 8.30 am and 6.30 pm, Monday to Saturday. He said that the workshop did not even open until 9.00 am, which was the time that he arrived at the premises after having dropped his daughter off at school.

30      He testified that the claimant did not remain at the respondent’s premises as alleged. He said that the claimant used to come and go as he pleased because at the time he was actively seeking employment as a welder and left the respondent’s premises to seek out employment. In that regard Mr Ji’s, daughter assisted the claimant in completing various job applications.

31      Mr Ji denies promising to pay the claimant 10% of the value of each vehicle repaired. He points out that the claimant is not a qualified panel beater and was not capable of repairing cars. Whilst in the workshop the claimant did, on the odd occasion in an attempt to help, do some work on cars but that work was generally valueless because rather than repair vehicles he further damaged them.

32      Mr Ji asserts that his relationship with the claimant soured after the pair disagreed about a matter concerning the repair of the claimant’s own vehicle. Mr Ji asserts that the claimant used the respondent’s account to purchase parts for his own vehicle. Consequently, he refused to pay him his weekly amount of $500. That led to vindictive retribution by the claimant.

Other Evidence Called by the Respondent

33      The respondent called two witnesses being Ms Nan Ji (Ms Ji) and his friend and former work colleague Mr Hong Wei (Mr Wei).

34      Ms Ji testified that she assisted the claimant in his attempt to find employment as a welder. She assisted him in completing his résumé. She said that on occasions the claimant attended her home and was invited to stay for dinner. She testified that she ‘thinks’ she saw her father (Mr Ji) give the claimant money on one occasion but could not elaborate further in that regard.

35      Mr Wei testified that on occasions he attended the respondent’s workshop and at those times, saw the claimant doing odd jobs unconnected to panel beating. He said that he used to assist Mr Ji at the respondent’s workshop some nights and on weekends and that the claimant was never there at those times. He told the court he remembered Mr Ji telling him in the hearing of the claimant that he was paying the claimant $300 to $500 per week to do odd jobs.

Assessment of the Evidence

36      The claimant impressed me as a truthful witness. He was unmoved when cross-examined and much of his evidence was corroborated by the witnesses he called. One of those witnesses, Mr Luo, was particularly impressive in his manner of delivery. He too stood firm under cross-examination. I found Mr Luo to be a truthful witness. His evidence corroborated the claimant’s assertions that he worked as a panel beater on cars in the respondent’s workshop. His evidence of the dispute that occurred in late August 2013 is also crucial because it confirms the claimant’s contention that Mr Ji initially refuted the claim for payment on the grounds that he did not have the money to pay him.

37      By contrast, Mr Ji’s evidence is unacceptable. His credit is found wanting. On the one hand he asserts that the claimant did only odd jobs and was rarely at the workshop, yet at the same time asserts that he paid him cash amounts of between $300 and $500 per week. He said that he, in part, paid him those amounts out of sympathy for his situation. The alleged payments were made altruistically to help the claimant as a friend. I note, however, that Mr Ji had only recently met the claimant. They were hardly friends. Further it is highly improbable that Mr Ji would pay the claimant $300 to $500 per week for doing very little.

38      The claimant rejects the contention that he had received cash payments and I believe him in that regard. I suspect that the suggestion that the claimant was paid is an invention aimed at defeating the claim. There is no credible corroborative evidence of such payments. Ms Ji’s evidence in that regard was vague and confused. I reject her evidence. Her evidence, particularly under cross-examination, was found wanting. She was vague as to the specific place, time and circumstance of such payments. Her evidence appeared to be given in a biased fashion aimed at supporting her father. The evidence she gave about assisting the claimant in seeking alternate employment is of no particular consequence and does not derogate from the fact that the claimant worked in the respondent’s workshop repairing vehicles.

39      Mr Wei’s evidence was similarly unacceptable. He was, when cross-examined, found to be particularly vague as to place, time and circumstance concerning the claimant work at the workshop. His evidence about never having met the claimant was unconvincing when challenged under cross-examination.

Findings

Did the Parties Enter into a Contract of Employment?

40      I find that the claimant was employed by Mr Ji on behalf of the respondent as alleged by the claimant. The fact that he was employed is supported by the fact that the claimant worked for the respondent on a full-time basis on Mondays to Saturdays, generally between 8.30 am and 6.30 pm as was recorded by the claimant. I accept that the claimant’s record (exhibit 1) is genuine, contemporaneous and accurate. The fact that the claimant worked for the respondent on a regular full-time basis is also supported by the evidence of Mr Luo, who saw him regularly doing automotive work.

41      The fact that the claimant was employed is corroborated by the provision to him of a uniform. That contraindicates any notion of an informal arrangement. The fact that the claimant had in his possession the uniform supports his contention that it was given to him by Mr Ji to wear at the workplace.

42      It is clear to me that Mr Ji, on behalf of the respondent, employed the claimant to repair motor vehicles and to do other odd jobs that was required by the respondent. I accept that the parties agreed that the claimant’s remuneration was to be on the basis that he would be paid 10% of the sale price of each vehicle repaired by the claimant. I am satisfied that the claimant was not paid in accordance with that agreement, or at all.

43      I am satisfied that the claimant did not work for the respondent under the arrangement suggested by Mr Ji.

44      I find that the claimant worked at the respondent’s workshop using, with one exception, the tools and equipment provided by the respondent and at all times was under the control and direction of Mr Ji. The claimant provided nothing more than his labour in repairing vehicles. I am also satisfied that the respondent paid for all the parts used by the claimant in the repair of motor vehicles. The claimant never had any proprietary interest in the vehicles repaired and there was never any partnership intended or created.

45      I accept the claimant’s evidence that the parties entered into an oral contract of employment in which it was agreed that the claimant would work for the respondent on the basis that he would be remunerated and that he would receive 10% of the sale value of each vehicle he repaired. It is clear that such term sought to oust the provisions of the Award and, to that extent, is void.

Did the Vehicle Manufacturing, Repair, Services and Retail Award 2010 [MA000089] Apply?

46      The answer to the question posed above is yes. Clause 4.1 of the Award covers all employees throughout Australia engaged in vehicle repair. The respondent’s business was that of vehicle repair providing panel beating and painting services.

47      Further, the Award had application to the parties because the respondent was a national systems employer within the meaning of s 14(1)(a) of the Fair Work Act 2009 (FW Act).

Was the Claimant Paid in Accordance with the Award?

48      The respondent did not pay the claimant in accordance with the Award or in any other way.

49      The claimant asserts that he is owed $25,827.84. He calculates that amount on the basis that he worked 1,121 hours and that he should have been paid at the rate of $23.04 per hour for each of those hours. The hourly rate of $23.04 claimed is not derived from the Award, but rather is the hourly rate that the claimant’s former employer used to pay him whilst he was employed as a welder.

50      The claimant’s claim is based on a flat hourly rate excluding overtime penalties and allowances however it is apparent from his evidence and other evidentiary material produced, such as exhibit 1, that he is entitled to overtime penalties and allowances.

51      Before deciding the quantum of his entitlement I must, for the purpose of determining the hourly rate payable to the claimant, establish what his proper classification was under the Award. In that regard, I am satisfied that the claimant fell within the classification of ‘Vehicle industry RS&R – tradesperson or equivalent Level 1 R6’ as set out in cl B.6 of Schedule B of the Award. The classification of ‘welder’ which applied to the claimant is found within it.

52      It follows that the Award hourly rate payable to the claimant with respect to his employment with the respondent was $18.58 until 30 June 2013 and then increased to $19.07 on 1 July 2013. The hourly rate used by the claimant cannot be used because it is not the relevant rate provided by the Award.

53      I accept that the claimant worked the 1,121 hours that he claims to have worked. Exhibit 1 supports his contention in that regard.

54      During the course of these proceedings I informed the claimant that his election to use the small claims procedure as provided by s 548 of the FW Act meant that the court could not make an order for payment in excess of $20,000. He was informed that should he want to recover in excess of $20,000, he needed to discontinue this small claim proceeding and instead commence a general procedure proceeding. He did not do that and has indicated he wishes to continue with his claim utilising the small claims procedure. He informed the court that he abandons any claim in excess of $20,000. Had the claimant not done so and proceeded otherwise, he would have recovered in excess of that which this court is empowered to order pursuant to s 548(2)(a) of the FW Act.

55      The claimant seeks payment for the 1,121 hours worked at a flat hourly rate. An hourly rate of $18.58 was payable to the claimant up to 30 June 2013. If one uses that hourly rate alone without regard to the increase on 1 July 2013 and any other entitlements for overtime penalties and allowances the amount payable is $20,828.18. Given that amount exceeds the amount which this court can order it will be unnecessary to calculate the claimant’s precise entitlement.

Conclusion

56      The claim is proven.

57      I order that the respondent pay to the claimant $20,000 less tax payable to the Australian Taxation Office.

58      Given that the claimant has not sought the imposition of a civil penalty, no further order is made.

G. CICCHINI

INDUSTRIAL MAGISTRATE