Re Director-General of Social Services v Kim Leonie Thomson [1981] FCA 209; (1981) 53 FLR 356 (16 December 1981)

FEDERAL COURT OF AUSTRALIA

Re: DIRECTOR-GENERAL OF SOCIAL SERVICES
And: KIM LEONIE THOMSON [1981] FCA 209; (1981) 53 FLR 356
No. G24 of 1981
Social Services - Statutes

COURT

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY
GENERAL DIVISION
Bowen C.J.(1), Fisher(1) and Fitzgerald(1) JJ.

CATCHWORDS

Social Services - appeal from a decision of the Administrative Appeals Tribunal - student attending a tertiary institution "full-time" - entitlement to an unemployment benefit - meaning of "unemployed" - not merely a lack of paid work - activities being pursued not the sole factor - importance of intention.

Green v. Daniels [1977] HCA 18; (1977) 51 ALJR 463 distinguished.

Social Services Act 1947 s.107(1)(c).

Statutes - Interpretation - Social services - Entitlement to unemployment benefit - "Unemployed" - Full-time student - Whether tertiary student can be "unemployed" - Importance of intention - Social Services Act 1947 (Cth), s. 107(1)(c).

Social Services - Entitlement to unemployment benefit - "Unemployed" - Meaning - Full-time student - Whether tertiary student can be "unemployed" - Importance of intention - Social Services Act 1947 (Cth), s. 107(1)(c). The respondent, having completed a course in commercial art, obtained some employment as a commercial artist but by the beginning of 1980 she was without work in that field. In about February 1980 she enrolled in a fashion design course to fill in the time while looking for work. She did not permit her course to interfere with her efforts to obtain work. She applied for and was granted unemployment benefit for the period between February and July 1980. However, the Director-General of Social Services decided that she was not qualified to receive the benefit for that period and that she had been overpaid the full amount. Upon the respondent's application the Administrative Appeals Tribunal reversed that decision and decided that the respondent was unemployed during the relevant period within the meaning of s. 107(1)(c)(i) of the Social Services Act 1947. The Director-General appealed against that decision.

Held, per curiam, that the appeal should be dismissed. The various matters as to which an applicant must satisfy the Director-General are not separate and distinct from each other. One important matter for consideration is the applicant's intention at the relevant time. As a matter of law, the Tribunal's decision that the respondent was unemployed was open to it.

Green v. Daniels [1977] HCA 18; (1977), 51 ALJR 463, distinguished.

HEARING

Brisbane, 1981, November 25; December 16. 16:12:1981
APPEAL.

Appeal to the Full Court of the Federal Court of Australia from a decision of the Administrative Appeals Tribunal.

The facts of the case are set out fully in the judgment that follows.

D.P. Drummond Q.C., for the appellant.

P.A. Keane, for the respondent.

Cur. adv. vult.

Solicitor for the appellant: B.J. O'Donovan, Commonwealth Crown Solicitor.

Solicitors for the respondent: O'Mara Patterson & Perrier.
E.F. FROHLICH

ORDER

1. The appeal be dismissed.

2. The decision of the Administrative Appeals Tribunal dated 12 June 1981 be varied by substituting therefor an order that there be set aside the decision of the Director-General made pursuant to Section 140(2) of the Social Services Act 1947 that Miss Thomson was not entitled to receive an unemployment benefit in respect of the period from 20 February 1980 to 29 July 1980.

3. The Director-General pay to Miss Thomson her costs of the appeal.

DECISION

The Director-General of Social Services has appealed to this Court from a decision of the Administrative Appeals Tribunal dated 12 June 1981 reviewing a decision made by him. The question raised is whether it was open to the Tribunal, on the facts found by it, to decide that Miss Thomson, the respondent, had satisfied it that she was unemployed during the period 20 February 1980 to 29 July 1980 or any part of it within the meaning of that term in s.107(1)(c)(i) of the Social Services Act 1947. Two other questions raised in the notice of appeal were abandoned, and another was not argued as it was unnecessary to do so, an answer favourable to the Director-General depending upon a negative answer to the question of law stated above.

The facts found by the Tribunal were not in dispute. Miss Thomson completed a course in Commercial Art at a College of Advanced Education at the end of 1978. Notwithstanding a scarcity of that work, she obtained some employment as a commercial artist during 1979. However, by the beginning of 1980 she was without work in that field. To fill in time while looking for work, she enrolled in a fashion design course at the same College. During the first semester she attended the College on two full days per week. She also attended particular classes on some other days. During the second semester, which commenced in July 1980, she attended on four full days per week.

Miss Thomson did not embark on the fashion design course with any commitment to complete it. She continued her search for employment. She answered advertisements for jobs in the commercial art field, attended interviews with employers and made direct approaches to them. She did not permit her course to interfere with her efforts to obtain work. When necessary she absented herself from classes. When unsuccessful in obtaining work as a commercial artist she applied, with limited success, for employment in fast food and other retail establishments.

The Tribunal was satisfied that she was genuinely and actively seeking employment and was willing to undertake suitable work if available. It was also satisfied that she would have ceased to attend the course had employment become available.

Miss Thomson applied for and was granted an unemployment benefit for the period 20 February to 29 July 1980. The Director-General, however, made a decision that she was not qualified to receive the benefit for that period. He also determined that she had been overpaid the full amount.

Insofar as it is presently relevant, s.107(1) of the Act provides as follows:
"107(1) Subject to this Part, a person (not being a person in receipt of a pension under Part III or IV or a service pension under the Repatriation Act 1920) is qualified to receive an unemployment benefit in respect of a period (in this section referred to as the 'relevant period') if, and only if -

(a) . . .

(b) . . .

(c) the person satisfies the Director-General that -

(i) throughout the relevant period he was unemployed and was capable of undertaking, and was willing to undertake, paid work that, in the opinion of the Director-General, was suitable to be undertaken by the person; and

(ii) he had taken, during the relevant period, reasonable steps to obtain such work."

The submission of Counsel for the Director-General was that, as a matter of law, a full-time student could not be said to be "unemployed" on the proper construction of s.107. The point was made that, in context, "unemployed" does not denote merely a lack of employment. Our attention was drawn to the judgment of Stephen J. in Green v. Daniels [1977] HCA 18; (1977) 51 A.L.J.R. 463, particularly at p.467. His Honour there said:

" . . . I have adopted as correct what was implicit in the arguments of both parties, namely that a person is not unemployed within the meaning of s.107 either when actually attending school or tertiary institution or when on vacation before returning to school or other institution. The term 'unemployed' is not defined in the Act and it would, in my view, be inconsistent with ordinary usage to describe such a student as unemployed in the context of this legislation's provision of benefits for the unemployed. On the other hand, one leaving school with the intention of not returning to his studies but, instead, of seeking work and who begins to seek employment appears to me thereupon to answer the description of one who is unemployed. He will continue to do so so long as he remains out of employment and retains his intention of entering the workforce."

Counsel for the Director-General submitted that a person is not "unemployed" within the meaning of the section if engaged "full-time", as opposed to intermittently, in activities which are neither leisure nor productive of remuneration. Such a test, it was said, would exclude not only full-time students but others, such as house-wives and self-employed persons who are not ordinarily regarded as "unemployed".

The concept of "paid work" provides a useful starting point. At its broadest the description "unemployed" encompasses those who are without paid work. We appreciate that the statute itself, for example s.107(3), admits some limited extension of this but, subject to that qualification, the notion of "paid work" as the antithesis of "unemployment" seems to accord with common sense and with the statutory context. Other provisions to which our attention was directed were sub-ss.107(4) and (7), s.124(1)(b)(c), and s.130A. None of these is of particular assistance.

Some further limitation is, however, necessary to determine the true meaning of "unemployed". Neither in ordinary parlance nor in the context of the legislation is everyone who is without paid work "unemployed"; for example, neither the very young nor the very old and infirm would usually be so described.

Counsel for the Director-General submitted s.107(1)(c) imposes a number of requirements and a construction ought to be adopted which would not render any of these otiose. Whilst conceding the validity of this contention, we do not think that it affords a solution. The three requirements to be satisfied by an applicant for unemployment benefit, other than that he or she be unemployed, are each concerned not with work per se, but with "work that, in the opinion of the Director-General, was suitable to be undertaken" by the applicant for the benefit. No doubt, one of the objects of this is to ensure that a person who is without paid work cannot achieve an entitlement to an unemployment benefit by seeking only work for which he or she is unqualified or otherwise unsuitable.

However, the various matters as to which an applicant for an unemployment benefit must satisfy the Director-General are not separate and distinct from each other. Facts which touch upon one of the requirements may also be relevant to one or more of the other requirements.

The meaning of "unemployed" in the Act was the subject of careful consideration in Green v. Daniels, supra. The plaintiff there was a girl of 16 who completed her school year and registered for unemployment. Thereafter, pursuant to her decision to leave school and seek employment, she made unsuccessful efforts during the ensuing three months to secure employment. Under a departmental policy she was refused benefit until the expiration of the school holidays some three months after she had left school. It was not in dispute that the plaintiff satisfied the requirements of paras. (a) and (b) of s.107 of the Act, which was not then materially different for present purposes. It was also conceded that the Director-General had been satisfied, prior to the end of the school holidays, that the plaintiff was capable of undertaking and was willing to undertake work which, in the opinion of the Director-General, was suitable to be undertaken by her.

Insofar as the decision was concerned with the question of whether or not a person is "unemployed", it was concerned with a different factual situation from the present case.

The judgment of Stephen J. contains a useful discussion of the position of school leavers who change their intentions. He referred (at p.469) to the issue of whether Miss Green was unemployed as "involving the question of whether she had genuinely ended her school career and was seeking a place in the workforce". His Honour considered that the state of being unemployed was satisfied as soon as a student left school, with the intention of not returning but, instead, of entering the workforce. He was critical of the policy of the Department that school leavers would not be in a position to satisfy the conditions of eligibility until the end of the school vacation.

In our opinion, Green v. Daniels has left the issue for determination in the present case unresolved. The hypothetical student with whom Stephen J. was concerned was one who either maintained an intention to join the workforce and did not return to study, as in the case of Miss Green, or one who not only returned to her study, but who also abandoned his or her intention to join the workforce. There was no need for Stephen J. to consider whether or not, or in what circumstances, a person is unemployed who, whilst persevering in an intention to join the workforce as soon as possible, and for that matter doing all else required of her under s.107(1)(c), pursues activities in time available through lack of paid work.

That is the issue in the present case. The Director-General seeks to distinguish between recreational and other activities, such as study. In the case of the latter he contends that a person is not unemployed if the studies are pursued on a full-time basis, and not merely intermittently. He further says that that conclusion must be arrived at as a matter of law, that is, as a matter of interpretation of s.107.

Miss Thomson, he submits, affords one example of a person who was not unemployed because she had a full-time occupation, although it was not paid work. Other examples of persons not unemployed according to the Director-General although unsuccessfully seeking a job would be perhaps the young person who for the time being returns to school, the housewife who continues to care for her home and family, and the person who undertakes full-time charity work, for example, helping out the local kindergarten or school. All of these may be contrasted at least to an extent with the person who, whilst seeking a job, pursues such activities only from time to time, or indulges only in leisure or indolence. The latter, alone, are, according to the Director-General, "unemployed".

The lack of appeal in this approach is obvious. We see no reason why Parliament should have intended such a result, unless the reason lay in apprehended difficulties in processing claims for benefit, or perceived risks of potential abuse. But it must be kept in mind that the material part of the legislation treats questions such as the present as matters of fact and degree. Terms are undefined and detailed tests are not prescribed. Matters are left to the decision of the Director-General, subject to review by the Tribunal. Such a legislative scheme seems to us to accept the operational burden of numerous individual decisions, and at the same time to provide by way of safeguard a need for the applicant for benefit to satisfy those administering the scheme that he or she qualifies for entitlement.

For all that, the possibility must be recognised that activities being pursued by a person without paid work may be so fundamentally incompatible with the person's being regarded as unemployed that no further inquiry is necessary. However, we anticipate that such a case would be exceptional. In the usual case, of which we think this is an example, the solution will be arrived at by reference to all the circumstances, of which the activities being pursued for the time being by the applicant for benefit will be one.

As already noted the various requirements prescribed by s.107(1)(c) are not divorced each from the other. Thus, evidence that a person without paid work is seeking work may be relevant, not only to the question whether that person has taken reasonable steps to obtain work (s.107(1)(c)(ii)), but also to the question whether that person is willing to undertake paid work, and again to the question whether the person is, in the relevant sense, unemployed. Conversely, the fact that a person is a full-time student may often evidence not only that the person is not willing to undertake paid work but also that, in a relevant sense, the person is not unemployed.

We are, of course, concerned here only with Miss Thomson. The position of the student who returns to school, or who claims to be unemployed whilst pursuing a course in another discipline, will be determined if such a claim arises. Reference to such persons serves only to highlight the difference, at least of degree, between them and Miss Thomson. To describe her, and others undergoing different courses, as "full-time", serves in our opinion only to disguise the problem. Some "full-time" courses may be 9 a.m. to 5 p.m., Monday to Friday, or even more demanding. At the other extreme a "full-time" course may require attendance at lectures for only a relatively insignificant part of the week. In Miss Thomson's case, she attended lectures on 2 days per week in the first semester and on 4 days per week in the second semester in the relevant year.

Counsel for the Director-General recognised these differences. His submission was that it was a question of fact whether a course was or was not "full-time" but that, if that question of fact be answered affirmatively, the student was not unemployed as a matter of law.

We see no warrant for the substitution of this test for that set out in the statute. It involves, incorrectly in our view, the isolation of one aspect of the circumstances surrounding an applicant for a benefit, to the exclusion of all others. For the reasons we have given, we prefer the view that the activities being pursued by an applicant for a benefit are to be considered with all other relevant factors in determining whether he or she is unemployed. One important matter for consideration is the applicant's intention at the relevant time.

Notwithstanding the form in which the question of law is stated in the notice of appeal, no submission was made to us that, while a person pursuing such a course of study as was Miss Thomson might be unemployed, the totality of the facts found by the Tribunal could not support such a conclusion in her case. In any event, we are satisfied that it could not be said that, as a matter of law, the Tribunal's decision that Miss Thomson was unemployed was not open to it.

In the result we are of opinion that the Director-General's appeal should be dismissed with costs.

There was before us some confusion as to the decision of the Director-General which was before the Tribunal for review, and accordingly as to the form of the Tribunal's decision. It would be better, we think, to vary its terms to provide that the decision that Miss Thomson was not entitled to receive an unemployment benefit during the relevant period be set aside.