In 2017, there were several important decisions handed down by the Federal Circuit Court of Australia that examine in detail provisions of the Air Pilots Award 2010. Whenever a provision of the Award is interpreted by a court, it provides an important precedent that can be used by the AFAP to assess how future claims might be dealt with. It also indicates which parts of the Award require revision as part of the Award variation process conducted by the Fair Work Commission.
One of those decisions is Fair Work Ombudsman v Broome Helicopter Services Pty Ltd & Anor  FCCA 2364, a decision of Judge Lucev who sits in Perth. The decision is particularly important because it gives content to various provisions of the Award that have not been judicially covered before. It does so on a set of circumstances that reflects the reality for many pilots starting out in their career who are working for small regional operators that often only see the Award as a guideline rather than what it really is – the minimum conditions and entitlements to which all pilots covered by the Award are entitled.
The AFAP understands that it can be a difficult thing for a pilot who is just commencing their aviation career, and who needs the flying hours, to raise the fact that they are not receiving their minimum entitlements. This decision should provide assurance to those pilots that a court will assist them, albeit through a process that can take a long time and where a pilot must put their hand up and give evidence.
Broome Helicopter Services Pty Ltd (BHS) is a small operator based in Broome. Its operations include tourist and commercial flights in and around Broome in the Kimberley region of Western Australia. Two pilots employed by BHS, Michel Thomson and Guy Sullivan, ceased their employment on 19th September 2012 and 24th September 2012 respectively. After their employment ceased, the Fair Work Ombudsman commenced proceedings on their behalf against both BHS and its sole director/Chief Pilot, Joseph Calandra. The liability of Calandra will be addressed specifically later in this article.
The proceedings commenced by the Fair Work Ombudsman alleged various breaches of the Award. This article will address the most important of these breaches, where a pilot performs mixed functions, employee records, when a pilot must be paid, roster publication and when a sole director/Chief Pilot may be considered to have assessorial liability for contraventions of the employing entity.
It is important to note at the outset that the court process is not a quick one. The claims made in this decision relate to periods of employment in 2012. The proceeding was commenced in 2013. Although liability has been determined, the quantum of that liability and any penalties to be applied to BHS and/or Calandra are still being determined. Although every case is different, it demonstrates that commencing proceedings is not necessarily a quick solution. Nevertheless, minimum entitlements should be enforced and a court is an extremely persuasive forum for this to occur.
One of the main issues considered by Judge Lucev was how to characterise pilots who perform functions other than flying. In operators such as BHS, pilots are often required to perform duties unrelated to flying such as administrative tasks, taking bookings, loading/off-loading passengers and cleaning duties. The question considered by the Court was, did the Award rates of pay only apply to the hours that strict pilot duties were performed (which would have resulted in part time employment).
Judge Lucev found that it was necessary to apply the Principal Function test. The Principal Function test determines the major, substantial or principal aspect of the work performed by the employee. This involves an examination of the time required to perform those duties, and more importantly the hierarchy of those duties, to determine what the true principal function of the role is.
In this case it was found that the principal function was that of a pilot. All the other tasks required would have not have been performed if the employees were not pilots. Accordingly, BHS was obliged to pay its employees as pilots under the Award for the duration of their employment regardless of their other duties.
An important related issue was raised by BHS. It argued that as the pilots would fly for a short while in the morning to take passengers, and then wait for long breaks until the passengers were ready to return, then these long breaks were essentially free time. BHS argued that these periods of time should not be paid. The Court did not accept this argument and found that the pilots were required to be at these locations by BHS. It was therefore time worked.
In relation to evidence to establish what hours were worked by the pilots, evidence was given that Calandra had directed pilots to insert incorrect work times in their flight sheets. The Court found that a more reliably accurate record of hours worked was the information recorded by the pilots in their log books.
Under the Fair Work Act 2009 (Cth) (FW Act), employers are required to keep employee records detailing very specific information including pay details and how those amounts are made up, hours of work, annual leave records and superannuation records. These records must be kept for a period of seven years. In addition, payslips must be provided to employees within one day of a pilot being paid. In this decision, the falsification of the time sheets at BHS constituted a clear breach of its obligation to make and keep correct employee records.
When payment must occur
After pilots raised the issue of underpayments, BHS made various lump sum payments that it claimed extinguished its liability. The Court disagreed. The FW Act requires that payments in relation to work must be paid in full and at least monthly. Lump sum payments correcting any underpayments made outside this period are not sufficient to meet the requirements of the FW Act. Accordingly, although pilots may receive their entitlements eventually, it is still a breach of the FW Act if they are paid late.
The Award requires that rosters need to cover a 14-day period, and must be published no less than seven days prior to the commencement of the period. BHS had a practice in place whereby each pilot’s iPhone was connected to the office computer. Appointments were made in the calendar which would then be sent to each pilot’s iPhone. Rosters were often prepared a week or two in advance, however they were frequently changed on short notice, and often the night before the relevant duty.
The Court found that although a roster may be published electronically, the practice at BHS was not in accordance with the Award. Judge Lucev noted that rosters represent an allocation of hours of work and are not a mere forecast. An employer who issues a blank roster and invites employees to nominate their shifts does not meet the requirements of the Award.
In this decision the rosters published by BHS indicated the activity to be performed, but not the employee who was rostered to work that activity. Accordingly, BHS had breached the Award.
Liability of Calendra
As noted above, the proceeding was also brought against Calandra, the sole director and Chief Pilot of BHS. An individual may be found to be liable for the breaches of the employer company if they are ‘knowingly concerned’ in the contraventions of the company. This does not mean that the individual must have intentionally known he or she was contravening the Award or FW Act, rather that he or she knew the essential matters going to make up the contravention.
The Court found that Calandra:
- was aware that BHS must comply with Commonwealth workplace laws and the Award
- was responsible for management and control of company as a sole director and Chief Pilot
- had ultimate responsibility for company payroll
- had ultimate responsibility for decisions regarding staff (such as the setting wages, the timing of payments and approving payments)
- authorised decisions regarding company operations.
Accordingly, Calendra was found to be ‘knowingly concerned’. It didn’t matter whether he knew he was breaching the Award or the FW Act, rather, he knew the essential matters going to make up the contraventions.
The importance of a finding of accessorial liability is that penalties can be applied on the individual as well as the employer-company, and the individual can also be made personally liable to pay any compensation that is owed.
Advice for pilots
For a pilot who is starting out in their career it can often be difficult to raise issues with a new employer. Pilots in this situation are often more concerned with landing a job, getting their hours up and moving on. This makes them vulnerable to unscrupulous employers who take advantage of their employee pilots and don’t see the Award as a strict safety net of entitlements. This issue is often compounded where it is a pilot's first job and the workplace is non-unionised and remote.
However, early identification of these issues and their resolution can assist in recovery for the individual pilot, as well as ensuring that standards are maintained in aviation generally. Pilots have six years in which to bring a claim for a breach of the Award or the FW Act, however by this time evidence can be difficult to collate and memories are not as persuasive when giving evidence. For this reason, the AFAP always urges raising issues sooner rather than later.
Court cases are not to be taken lightly. They can be long, tiring and uncomfortable for the pilot concerned. The AFAP will always support members on whose behalf the AFAP commences proceedings. Of course the AFAP always attempts to resolve issues at an earlier stage, without needing to resort to litigation, however this depends on the approach of the employer in question.
The decision reviewed in this article is a good decision for pilots. It clarifies many aspects of the Award, and gives clear guidance to both pilots and employers. Most beneficially, it provides a clear precedent to enforce minimum standards contained in the Award.
Article written by AFAP Legal Counsel, Andrew Molnar. To read more articles like these, join the AFAP to get access to Air Pilot, the Journal of the Australian Federation of Air Pilots.