Vourloumis v Allied Express Transport Pty Ltd [2006] NSWIRComm 399 (15 December 2006)

Last Updated: 18 April 2007

NEW SOUTH WALES INDUSTRIAL RELATIONS COMMISSION

CITATION : Vourloumis v Allied Express Transport Pty Ltd [2006] NSWIRComm 399



FILE NUMBER(S): IRC 2950

HEARING DATE(S): 13/11/2006 - 17/11/2006, 24/11/2006, 5/12/2006 & 8/12/2006

DECISION DATE: 15/12/2006
PARTIES:
APPLICANT
Suearne Vourloumis

RESPONDENT
Allied Express Transport Pty Ltd

JUDGMENT OF: Marks J


LEGAL REPRESENTATIVES

APPLICANT
Mr A T Britt of counsel
SOLICITOR: Mr A Dicembre
McGrath Dicembre & Co

RESPONDENT
Mr P J Newall of counsel
SOLICITOR: Mr P Brown
Baker & McKenzie Solicitors

CASES CITED: Allison v Bega Valley Council (1995) 63 IR 68
Codelfa Construction Pty Ltd v State Rail Authority of NSW (1981-1982) 149 CLR 337
Sydney Water Corporation v NSW Industrial Relations Commission and anor (2004) 61 NSWLR 661
Thomson v Societe Generale Australia Limited [2006] NSWIRComm 24
Truelove v Sydney Water Corporation Ltd (2005) 146 IR 253

LEGISLATION CITED: Industrial Relations Act 1996



JUDGMENT:

- 25 -

INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

CORAM: Marks J

Friday, 15 December 2006

Matter No IRC 2950 of 2000

Suearne Vourloumis v Allied Express Transport Pty Ltd

Application under s 106 of the Industrial Relations Act 1996

JUDGMENT

[2006] NSWIRComm 399

1 These proceedings are constituted by an amended summons. The applicant, Suearne Vourloumis, claims certain relief under s 106 of the Industrial Relations Act 1996 (“the Act”) against the respondent, Allied Express Transport Pty Ltd. The applicant seeks a finding that a contract of employment that she had with the respondent was unfair. In essence, the applicant alleges that she was employed as a sales executive and that a term of her contract of employment was that she would be paid commission at the rate of 5% of sales referrable to new clients introduced by her to the respondent, in addition to other benefits including, of course, salary. The applicant alleges that she was, in fact, paid commission at that rate but that subsequently the respondent declined to pay her commission asserting firstly, that her commission rate was 1% and secondly, that no commission was payable in any event unless the applicant met a certain budgetary hurdle, which she had not achieved. The applicant alleges that her relationship with officers of the respondent became untenable as a result of her inability to resolve differences about her entitlement to remuneration, that she eventually became ill, that sick leave was not afforded to her as provided for in her contract of employment and that, in effect, she was forced out of her employment. The applicant claims payment of monies in lieu of notice of the termination of her employment and commission payments. The respondent had informed the applicant that it regarded her as having abandoned her employment. A further matter in dispute was whether some accounts with respect to which the applicant claimed commission had in fact been secured by her in circumstances that allowed her to claim that commission as part of her contract of employment.

2 The matters to which I have referred threw up a number of factual issues that were disputed in the proceedings. Furthermore, the respondent submitted that these proceedings were, in essence, proceedings seeking the enforcement of contractual rights which, by reason of the decision of the New South Wales Court of Appeal in Sydney Water Corporation v NSW Industrial Relations Commission and anor (2004) 61 NSWLR 661 (“Sydney Water”), was not a permissible utilisation of the provisions of s 106.

The factual background

3 It is first necessary to deal with the factual background to the proceedings as established by the evidence, which was essentially provided in affidavit form supplemented by oral testimony.

4 The applicant was introduced to the respondent by Mr Jim Georges, the then national sales manager, who was a family friend. She had a number of meetings with the managing director of the respondent and others in July 1996. In August 1996, she negotiated a contract of employment as a sales executive with Mr Georges. Mr Georges offered her a base annual salary of $50,000, an annual car allowance of $15,000 and “5% commission on annual gross turnover.” In early September, arrangements were made for the applicant to attend the respondent’s offices and she met with Mr Georges. She was given a letter dated 12 September 1996 on the letterhead of the respondent and was told that she could take it home and read it and that she was to start work on 14 October 1996. The applicant said that when she attended for work, she told Mr Georges that the letter that she received made provision for 1% commission payable on annual turnover, rather than 5%. She said she handed the letter to Mr Georges who apologised, said that he would take the letter to a Mr David Napper, which he did in the presence of the applicant. The applicant says that Mr Georges corrected the letter by deleting the reference to 1% and handwriting on it 5%. He then initialled the letter and handed it back. The applicant said she then signed the document and returned the letter to Mr Georges who gave her a photocopy. The applicant no longer has that copy in her possession.

5 There was tendered into evidence as part of an agreed bundle of documents a letter on the respondent’s letterhead addressed to the applicant dated 12 September 1996. That letter confirmed an offer of the position of corporate account executive at the respondent’s Bankstown office to commence from 14 October 1996. Importantly for reasons that I will develop later, the letter said in part “We would expect you will achieve cumulative sales of $45,500 over a 13 week period.”

6 Under the heading “Remuneration”, the letter said “Your commencing salary package will be $65,000 pa, (which includes 6% Superannuation in accordance with the relevant legislation), paid on a weekly basis into your bank account.” There is also reference to the inclusion within the $65,000 of a $15,000 motor vehicle allowance. Importantly, the letter then contained the following: “You will also receive commission, based on 1% of the annual turnover of new business gained by you.” Immediately after this sentence there appears in handwriting the words “This is to be reviewed after 3 months.”

7 There is a provision in the letter for termination beyond a probation period on the basis of the provision of 1 week’s notice or the payment of 1 week’s salary in lieu of notice, or notice “in line with any State or Federal legislative requirements.”

8 The letter was signed under what purported to be the hand of David Napper, described as the Human Resources Manager.

9 There is no other reference in the letter to the circumstances in which the commission would become payable.

10 The fourth page of the letter contains the words “I accept the appointment upon the terms and conditions outlined above” and there then bears the signature of the applicant, dated 14 October 1996.

11 The applicant was adamant in her evidence that this document was not a true copy of the letter of employment signed by her because that letter had the reference to 1% crossed out and 5% substituted in handwriting and it did not contain the words in handwriting referrable to a review after 3 months.

12 An affidavit of Mr Georges, prepared by the respondent’s solicitors, Baker and Mackenzie, was admitted into evidence and Mr Georges gave oral evidence. Mr Georges’ evidence covered a number of conversations with the applicant leading up to an offer of employment and leading up to the creation of the letter, dated 12 September 1996, signed 14 October 1996. In his affidavit, Mr Georges referred to the dissatisfaction expressed by the applicant with the reference to 1% commission. He said he gave the letter together with a handwritten note to Mr Napper. That handwritten note contains the words “1% annual turnover” and “cumulative 45,500 over 13 week period.” There is no reference on that handwritten note to 5%.

13 There is then annexed to Mr Georges’ affidavit the copy of the letter of 12 September 1996 to which I have referred and which I have described. I repeat, that it contains reference to commission based on 1% of annual turnover of new business and a handwritten note that that was to be reviewed after 3 months. Mr Georges’ affidavit states that that letter “is a complete copy of the letter of employment dated 12 September 1996 signed by Suearne. To the best of my knowledge and belief the handwritten annotation at the bottom of page 1 of this letter to the effect that ‘this is to be reviewed after 3 months’ is in David Napper’s handwriting, and has been initialled by David and signed by me in the margin. I note that the last page is signed by Suearne.”

14 In cross examination, Mr Georges readily conceded that he had had a discussion with the applicant and agreed with her that she would be paid commission at the rate of 5%. I set out below an extract of the cross examination of Mr Georges.

BRITT: Q. You asked Mr Naper(?) to change that figure?
A. Correct.

Q. You initialled that change?
A. Correct.

Q. That's the letter that was provided to the applicant?
A. I believe so.

Q. With the 5 percent figure?
A. Correct.

Q. What you've attached here in the first 3 pages is not the final contract with the applicant because it doesn't contain the figure of 5 percent?
A. I don't know if it's the final one or not.

Q. The one that you approved, was the 5 percent figure?
A. Yes.

Q. That's not the document which you have attached to your affidavit as annexure B?
A. No.

Q. The applicant never signed off in your presence, the document in relation to the 1 percent contract?
A. The applicant did sign in front of me but which document she signed, I don't know.

Q. It was, in fact, the 5 percent document that she signed in front of you?
A. Possibly.

Q. Have you attached this affidavit because some one has told you this is the contract of employment?
A. Correct.

Q. It doesn't reflect your understanding now because you agreed to a 5 percent figure?
A. I do recall that there was a discussion about between 1 and 5 percent. I don't recall exactly how the change happened from 1 to 5 percent. However, yes, it was agreed to the 5 percent.

Q. Can you recall who gave you this document, annexure B?
A. At the time?

Q. No, in relation to preparing your affidavit?
A. I believe it was done through the Baker and McKenzie's.

*Q. You relied upon them telling you that this is the applicant's contract of employment when attaching that to your affidavit?

OBJECTION.

NEWALL: There is no evidence that he was told that.

HIS HONOUR: He just said it. I will allow the question. He just said in answer to the question that it was "told to me that it was the contract of employment".

ABOVE ASTERISK (*) QUESTION READ BACK.

OBJECTION

Q. You relied upon that in attaching this to your affidavit?
A. I was told this was the letter of appointment.

Q. You relied upon that in order to attach it --
A. Yes.

Q. --to your affidavit and the description you have given it in your affidavit?
A. Yes.

15 There can be no doubt that the evidence of Mr Georges corresponds with that of the applicant. That is, that there was agreement reached between him, on behalf of the respondent, and the applicant to the effect that she would be paid a commission of 5% of the annual turnover of new business gained by her. I do not accept that the applicant ever agreed to payment of 1% commission, nor that any contract signed by her contained the words “This is to be reviewed after 3 months.”

16 I am concerned that the solicitors for the respondent, Baker and Mackenzie, sought to persuade Mr Georges that the document which was annexed to his affidavit was in fact the letter of appointment signed by the applicant in circumstances where Mr Georges was quite clear in his mind that the letter of appointment signed by her contained a reference to 5% commission.

17 That this was the evidence of Mr Georges was made clear to Baker and Mackenzie, because in April 2002, some eight months before those solicitors had assisted Mr Georges in preparing his affidavit, Mr Georges had sworn an affidavit that was filed in the proceedings on behalf of the applicant and that had been prepared for him by the applicant’s solicitor. That affidavit recounted conversations between Mr Georges and the applicant leading up to the signing of the letter of appointment. That affidavit recounted in particular that an original letter of appointment containing a reference to 1% commission had been rejected by the applicant and she had refused to sign it. That affidavit said that Mr Georges had attended on Mr Napper who had changed the commission rate from 1% to 5% in handwriting and that it had then been signed by the applicant. Mr Napper stated that “the commission was calculated each 13 weeks starting from the commencement of her employment.” In these circumstances, it was inappropriate for the respondent’s solicitors to have persuaded Mr Georges to swear an affidavit on the basis that a particular document represented the applicant’s contract of employment without asking him to explain his earlier inconsistent sworn evidence.

18 Evidence about the letter of appointment was also given by Susan Howse who was, for a period, employed as a Human Resources Manager for the respondent. She first had direct contact with the applicant in about May 1999 and participated in a number of discussions when differences arose with respect to the payment of the applicant’s commission. I shall refer to that aspect of the evidence of Ms Howse later.

19 Ms Howse prepared a file note of material that she had extracted from the applicant’s personnel file. There is a note dated 12 September 1996 that the applicant was employed on a salary of $65,000 which includes “1% commission on annual turnover of new business.” There is a further note dated 22 December 1998 to the effect “letter issued to Suearne re her commission scale, 1 at 1% and 1 at 5%. Neither letter was signed.” Ms Howse said that when she prepared the file note, the last date on which was 21 May 1999, there were two letters in the applicant’s personnel file, one containing reference to 5% and the other 1%. She said that she did not remove the 5% letter from the file nor did she destroy it. As I understand the evidence of Ms Howse, it may be that she was asked in December 1998 to prepare two letters, and that this reference dated 22 December 1998 may not have been a reference to the original letter dated 12 September 1996 to which I have earlier referred.

20 Mr Napper, in his affidavit evidence, annexed what he said was a copy of a letter of employment dated 12 September 1996, which he had prepared, and which he had addressed to the applicant and was signed on the final page. That document referred to commission of 1% and contained the words “This is to be reviewed after three months.” In cross-examination, Mr Napper said that he had been given that document by the solicitor from Baker and Mackenzie who was assisting him in preparing his affidavit. As the document that Mr Napper had been given contained at the end a separate page signed by the applicant purporting to accept her employment “upon the terms and conditions outlined above”, Mr Napper assumed that it was the contract of employment that the applicant had entered into with the respondent. Mr Napper conceded in cross-examination that he did not see the applicant sign the document nor did he recollect having any conversation with Mr Georges in which a change was to be made to the percentage of commission payable from 1% to 5%. He said that he did not believe that he had any such conversation but if he did he had no recollection of that conversation.

21 In any event, it is clear from the evidence of the applicant and Mr Georges that there was in existence at some stage a letter of appointment dated 12 September 1996 that referred to 5% commission payable to the applicant. The only copy of that letter was held by the respondent because the applicant no longer has the copy that was given to her at the time. In circumstances that have not been explained, that letter has been removed from the applicant’s personnel file retained by the respondent some time after 21 May 1999.

22 The applicant asserts that there was no other discussion between herself and Mr Georges about any detail concerning the circumstances in which, and the basis upon which, the commission would be paid. Mr Georges said in his affidavit prepared by the respondent’s solicitors that in the course of negotiating the applicant’s engagement as an employee, he explained to her in general terms the way in which the respondent’s commission structure operated. He said that he told the applicant that there were two types of sales positions, territory sales executives and corporate account executives. Relevantly, he said he told the applicant that a corporate account executive would normally earn a base package of about $65,000 to $75,000 inclusive of car allowance and superannuation. They would earn commission of 1% on all new accounts gained provided that the new account continued to trade for 13 weeks and “they are making budget. And the budget is usually a little higher. Although the commission is lower, it is calculated on all new business gained, and it’s paid for the first 12 months of trading on new accounts, but not after that. So there is much greater potential to maximise the commission you can earn. If you are making budget, you would be able to earn a fair amount.” Mr Georges said that he also explained to the applicant that the budget was a “rolling budget” so that it increased by the same amount each week to take into account income earned from accounts previously gained. He said he told the applicant that, for the first quarter, her total budget was $45,500 and after that “it goes up to $84,500 per quarter. That’s to give you a bit of lead in time to pick up your sales performance.”

23 Mr Georges said that he had conveyed this information to the applicant during the course of an initial interview. The applicant’s second interview was conducted by the general manager. Apart from introducing the applicant Mr Georges did not participate in the second interview.

24 The applicant denied that Mr Georges had ever discussed with her the fact that there would be a budget assigned to her, the nature of the budget nor that her ability to earn commission would be dependent on her achieving it.

25 In his evidence, Mr Georges said that account executives such as the applicant were required to submit documents to their sales managers on a weekly basis and they would be given, on a weekly basis, a performance summary which indicated their sales performance against their accumulated budget. However, the applicant said that these documents only commenced to be used by the respondent after she had been employed there for about 6 months.

26 A number of specific factual matters have been established by the evidence. It was the evidence of Michelle McDowell, the managing director of the respondent, that her perusal of the respondent’s records revealed that the applicant had never achieved what she understood to have been the budget established for the applicant, namely $500 per week on a rolling basis, calculated over a 13 week period. Despite this, it has also been established on the evidence that the respondent paid the applicant, from time to time, commission on sales calculated at 5%. That this was so was established by the evidence of Steve McGuirk, a former State sales manager of the respondent who held that position for a substantial period during which the applicant was employed by the respondent. That this was so is also established by documentation kept by the respondent that clearly showed commission paid to the applicant being calculated on the basis of 5% of sales generated.

27 Furthermore, Mr McGuirk deposed to the fact that he had had a conversation with Mr Georges towards the end of 1998 in which he reported that the applicant was being paid a 5% commission despite the fact that she did not appear to have achieved targets set for her. Mr Georges confirmed in a conversation with Mr McGuirk that the applicant had been engaged on the basis that she would be entitled to 5% commission of turnover in addition to her salary package.

28 The respondent maintained for the purpose of the proceedings that the applicant’s contract of employment with it did not provide for a 5% commission but only for 1%. In the face of the evidence constituted by that of Mssrs Georges and McGuirk and the documentation to which I have referred, I cannot comprehend how and on what basis the respondent could make such an assertion through its counsel, Mr Newell and, presumably, also through its solicitors, Mssrs Baker and Mackenzie. Nevertheless, the litigation proceeded on that basis.

29 I can only conclude on the basis of the evidence to which I have referred, and there was none in opposition, that the applicant’s contract of employment provided for commission of 5% on sales based on annual turnover without any reference to any budget hurdle.

30 The applicant went on annual leave for 3 weeks at the end of December 1997 and then went directly on to maternity leave, not returning to work until 9 February 1998. When she did so, she worked part-time for 20 - 25 hours a week. She returned to full-time employment on about 20 March 1998.

31 Some insight as to what ultimately created the breakdown in relationship between the applicant and the respondent may be gained by the evidence of Mr McGuirk.

32 In a conversation with Mr Georges in late 1998, Mr McGuirk said that he wanted to change the commission structure that applied to the applicant. He acknowledged in his evidence that, at all relevant times, he was aware that the applicant was entitled to receive 5% commission on annual turnover of new business brought in by her. Indeed, Mr McGuirk authorised the payment of commission on this basis even though she had not made the budget assigned to her. For example, on 13 January 1999, Mr McGuirk signed a document authorising the payment of commission of $1,135.61 to the applicant at a rate of 5% of sales for accounts in the name of “Courier NSW” and “Skytrax” for the period 16 October 1998 to 11 December 1998. That payment had been authorised by another person within the respondent’s organisation who had initialled it. The evidence in the proceedings was not clear as to whose initials they were. Although the name “Michelle McDowell” appears on the relevant document, her evidence was that they were not her initials.

33 Following his conversation with Mr Georges, Mr McGuirk said that he met with the applicant and explained to her that he wanted to change her commission structure. This would involve the application of a budget hurdle and a reduction in the amount of the commission to 1%. The applicant resisted any such change. Mr McGuirk advised the applicant that in his opinion her commission entitlement was bound, in any event, by the imposition of a budget hurdle. The applicant disagreed.

34 There was a further discussion in December 1998. On 22 December 1998, Mr McGuirk wrote to the applicant asserting that it was a condition of her employment that she was required to achieve a set accumulative budget of $500 per week and that she had failed to do so during the last three quarters. The letter stated that her results would be measured “monthly from January 1999.”

35 After receiving that letter, the applicant and Mr McGuirk had a conversation in which the applicant said that she firstly was not required to meet any budget but that, in any event, she had easily met her budget because of certain accounts she had brought in including AMP. The applicant alleges that Mr McGuirk conceded that the applicant should have been credited for sales from the AMP account but had not been so credited because there was not “enough fat in it”. Mr McGuirk denied that conversation. Whilst I accept that Mr McGuirk’s evidence was given by him as truthfully as he could recollect it, he conceded that in effect he had very little recollection of his conversations with the applicant and what had occurred. In general terms, I accept the contents of Mr McGuirk’s affidavit sworn in March 2002 but I prefer not to rely on his oral evidence given during the course of the proceedings as to what he may have recollected of his specific conversations with the applicant where inconsistent with her evidence because of his frank concession that he now has very little recollection independent of anything that had previously been committed to writing.

36 A second letter dated 22 December 1998 was given to the applicant. It was signed by Ms Howse and, as I understand it, purported to change the commission structure payable to the applicant. The letter stated that to be eligible for commission payments, which would be based on 1% of turnover gained by the applicant during a particular period, it would be necessary for her to have achieved an accumulated budget of $500 per week measured every 13 weeks. Mr McGuirk said that he had seen two versions of the letter. One contained a reference to 5% of turnover and the other to 1% of turnover. The applicant’s evidence was to the same effect.

37 Consistent with other evidence in the proceedings, it would seem that all documentation referrable to any payment of 5% commission to the applicant has been removed from her personnel file kept by the respondent. No explanation for that removal has been proffered.

38 Thereafter, there continued to be communication including meetings between the applicant and, principally, Mssrs Georges and McGuirk, assisted by Ms Howse. The respondent’s representatives continued to complain that the applicant was not meeting budget. She continued to complain that her budget was not being met because the respondent was not crediting her with new business that she was obtaining. The applicant continued to claim commission at the rate of 5% calculated on the basis that no budget hurdle applied.

39 Towards the end of these meetings, it seems that a degree of frustration caused the respondent’s representatives to speak to the applicant in a manner that was not appreciated by her. This led to a series of correspondence and other documentation that I shall summarise briefly. I refer to it particularly because, being contemporaneous, it is the best evidence of what was happening at that stage. Ms Howse prepared some minutes of part of a meeting that she attended between the applicant, Mr McGuirk and Mr Bill Gianappolous. The minutes refer to a discussion about the applicant’s entitlement to claim commission based on a number of accounts. There is a reference to the AMP and Qantas in particular. An arrangement was made for Mr Gianappolous to accompany the applicant on calls to secure business. Mr Gianappolous said that the parties would meet again the following Monday, which is clearly a reference to 17 May 1999. On that occasion, the applicant would have created a list of all accounts that she had said she had secured so that the respondent could check her entitlement to commission. A further meeting was scheduled for Friday 28 May 1999.

40 Notwithstanding this arrangement, the applicant was given a letter from Mr McGuirk dated 17 May 1999 which referred to the meeting the previous Friday but which also said, in part: “This letter is to be considered an official warning. Unless there is a remarkable improvement in your performance to budget within the next four weeks, we may have to review your ongoing employment with Allied Express.”

41 The applicant saw Ms Howse on the following day at about 2pm saying that she was upset and that she wished to work from home. By letter that day to Mr McGuirk, the applicant wrote complaining that a number of accounts had not been credited to her, that the respondent was seeking to impose a commission rate of 1% when she was clearly entitled to 5% and that the respondent was seeking to unilaterally alter her employment contract. She also complained that Mr Gianappolous had sworn at her and had spoken to her in an inappropriate manner that she found to be “distressing, intimidating and harassing.”

42 On 19 May 1999 the applicant’s husband delivered to the respondent a medical certificate stating that she was unfit for work and a further certificate was issued covering the period 24 - 28 May 1999.

43 On 24 May 1999 Ms Howse wrote to the applicant setting out the history of the matter and asking her to make contact to arrange an appointment to discuss a number of issues including the applicant’s work performance and allegations which she had made concerning the behaviour of a number of executives within the respondent’s organisation. The applicant responded by letter dated 24 May repeating her allegations.

44 I should add that by an internal memorandum Mr Giannappolous confirmed that he had sworn during the course of a meeting with the applicant and acknowledged that he had acted in an unprofessional manner. He said that he regretted the use of his “bad language” and would apologise for that. He explained his behaviour by reference to his frustration in dealing with the applicant.

45 On 26 May 1999, Ms Howse again wrote to the applicant indicating that she was awaiting contact to make an appointment so that all issues might by discussed with the managing director. There was concern that the applicant had abandoned her “employment responsibilities.”

46 This elicited a response dated 4 June 1999 from the applicant complaining that her sick leave had not been paid and indicating that if payment had not been made by 4pm that day, she would regard herself “as having been terminated.”

47 The applicant said that she had provided the respondent with a further medical certificate for the period 30 May 1999 to 4 June 1999. That medical certificate was not contained within the respondent’s records. However, Ms Howse said that she may have received three medical certificates from the applicant. Despite the evidence of Ms Howse that she did not doubt that the applicant was ill during these periods, there was evidence that the respondent had hired a private investigator. By facsimile dated 31 May 1999, Ms Howse asked a private enquiry agent to conduct surveillance of the applicant, which was carried out on 1, 2 and 3 June 1999. The surveillance activities did not disclose any conduct on the part of the applicant inconsistent with her assertion that she was ill at the time and not otherwise in employment.

48 By letter dated 7 June 1999 Ms Howse wrote to the applicant saying that as she had not made contact to arrange an appointment, her employment was deemed to have been abandoned. A further letter from Ms Howse dated 21 June 1999 set out details pertaining to the termination of the applicant’s employment and indicated that she had been paid one week’s pay in lieu of notice together with accrued annual leave as at 18 June 1999.

Was the contract unfair?

49 It will have been observed that the respondent declined to pay commission to the applicant on a number of grounds, some of which were contrary to a practice that had initially been adopted by it. The respondent took the position that the following circumstances applied to the entitlement to commission on the part of the applicant:

1) that the commission should be calculated at the rate of 1% of sales;
2) that those sales must have been substantially effected by the applicant and she must have been involved substantially in negotiations leading up to and in and about the consummation of any contract to the exclusion of the assistance of others;
3) that any contract negotiated by the applicant in this manner must have continued to subsist over a prolonged period without the need for intervention by any other person within the respondent’s organisation;
4) that there must have been sufficient profit in the contracts to enable commission to be payable;
5) that commission would only be payable provided that the applicant met a budget calculated at the rate of $500 per week accumulating over a thirteen week period.
6) that no commission would be payable during any period when the applicant was not at work, and especially on maternity leave;
7) that if any contract were entered into having an interstate source, this would be attended to by a senior executive within the respondent’s organisation and would not attract commission.

50 None of the documentation produced by the respondent or held by the applicant with respect to her contract of employment contained any detail with respect to the circumstances pertaining to the payment of commission outlined above and which were contended by the respondent to apply to the applicant. There was evidence from Mr Georges and Ms McDowell that the respondent had a policy document applying to commissions, but this was never shown to the applicant.

51 I have found that none of these matters was discussed between the applicant and representatives of the respondent prior to the time that the applicant commenced employment with the respondent nor for some little time thereafter. Certainly, there was no reference to any protocol or procedure adopted by the respondent which applied in general terms to circumstances in which the respondent’s employees would be entitled to be paid commission.

52 It follows from what I have said that there are no express terms of the applicant’s contract of employment with the respondent that set out the circumstances in which commission would become payable. It would then be a question of seeking to imply such terms by reference to the well known criteria adopted by the Courts in this regard. The difficulty in implying terms in a contract were adverted to by Mason J (as his Honour then was) in the High Court of Australia in Codelfa Construction Pty Ltd v State Rail Authority of NSW (1981-1982) 149 CLR 337 commencing at 345. Fortunately, it is not necessary that I embark upon such a course. This is because, in my opinion, the failure of the respondent to spell out with sufficient precision the circumstances in which the applicant would be entitled to earn commission, coupled with the respondent’s persistence in seeking to force the applicant to agree to provisions, which she understood significantly altered her entitlement to earn commission, rendered her contract of employment with the respondent relevantly unfair for the purpose of s 106 of the Act. Having so found, it is then appropriate to vary the contract of employment so as to remedy the unfairness that I have found.

53 The respondent submitted that all that the applicant was seeking to do in the proceedings was to enforce an existing contract of employment, something which was not permitted by reason of the judgment of the New South Wales Court of Appeal in Sydney Water and by the decision of the Full Bench of this Court in Truelove v Sydney Water Corporation Ltd (2005) 146 IR 253.

54 I summarised the effect of these authorities and their impact on s 106 proceedings in Thomson v Societe Generale Australia Limited [2006] NSWIRComm 24 in the following terms:

Sydney Water Corporation Ltd & Anor v Industrial Relations Commission of NSW & Anor [2004] NSWCA 436

168 The respondents relied on the above decision, being a decision of the New South Wales Court of Appeal in rejecting the applicants' claims. It was said that all that the applicants were doing was to seek to enforce provisions of the relevant contracts and arrangements which was not permissible having regard to the above decision.

169 The principal judgment in Sydney Water was that of Mason P. His Honour held that it was impermissible to apply s 106 of the Act to a contract in circumstances where the unfairness complained of was conduct which constituted a breach of the contract and for no other reason. The contract must otherwise be found to be unfair.

170 The findings of unfairness which I have made, and the circumstances in which the unfairness has arisen go beyond what was established in Sydney Water as being beyond consideration in s 106 proceedings. The findings of unfairness and the consequent relief which the Court is empowered to grant go beyond the mere enforcement of the provisions of the contract. Indeed, it has been necessary to determine to vary the provisions of the contract so as to remedy the unfairness of the manner in which the contract was drafted. This is a process which is far removed from merely construing and applying the provisions of the contract in accordance with established principles (see, for example, Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337, especially at [348] to [352] per Mason J).

171 The contract of employment between Mr Thomson and SGAL was not only unfair when entered into but also became unfair because of the manner in which it was drafted. In these circumstances the restrictions identified by the New South Wales Court of Appeal in Sydney Water are not applicable.

55 The observations that I made in Thomson apply equally to the circumstances of these proceedings. That is, it will be necessary to vary the contract of employment between the applicant and the respondent so as to remedy the unfairness that has been found. I repeat, these are not circumstances contemplated by the Sydney Water and Truelove authorities and these authorities do not impact upon the entitlement of this Court to apply the provisions of s 106 of the Act to these proceedings.

56 The respondent sought to resist a finding of unfairness on the basis that the applicant had a particular understanding of what her contract of employment provided and that all she was seeking to do was to enforce that understanding, something that was not permitted by the Sydney Water principles. I respectfully disagree. The respondent’s thesis is based upon an assertion as to the applicant’s understanding. However, Sydney Water is not directed to the understanding of a party to a contract. It is directed to the contract itself. That is, questions of enforcement of the provisions of a contract can only go to the contract provisions themselves, provisions which are either contained expressly within a contract or which may be implied by law according to well known principles. There can be no certainty that there was any contractual provision, or that there were any contractual provisions, going to the precise circumstances in which commission would become payable, the length of time during which and with respect to which commission would be payable and other matters relevant to the calculation of the commission. What was agreed was, in my opinion, in the broadest possible terms and certainly did not include any of the matters of detail that the respondent by its conduct asserted should govern any entitlement that the applicant might have to commission. This matter is compounded because the respondent conducted itself initially in a manner inconsistent with the terms and conditions that it said ultimately should apply to the entitlement of the applicant to be paid commission, in the manner that I have previously set out. In this regard I refer specifically to the rate of commission, the absence of a budget hurdle and the contribution made by the applicant and others to the sale as one of the circumstances in which commission would become payable.

57 In focussing, therefore, on the applicant’s understanding and in failing to focus on the contractual terms themselves, the respondent has, in my opinion, failed to address specifically the circumstances in which the Sydney Water principle might apply to these proceedings.

58 This conclusion is reinforced by the submissions made on behalf of the applicant with respect to the shortcomings in the contract of employment and the relief invoked under s 106. These included: allegations that the contract failed to specify what was intended by the words “gained by you” when referring to sales; failed to specify what happened to a sale effected by the applicant but which was then handled by someone else in the respondent’s organisation; allowed a client account manager to be credited with an account where a particular client had not traded for a period but following contact from a client account manager commenced to trade again thus depriving the original sales person of commission; the contract did not seemingly allow for the payment of commission when persons assisted the applicant in connection with the preparation of a tender for business; the respondent conducted itself so that some accounts did not attract commission; the failure to pay commission whilst on leave and an imposition of a budget hurdle. Furthermore, the applicant pointed to difficulties arising where some of the respondent’s clients would have multiple accounts that had been obtained by different sales executives and those clients determined upon which of those accounts to trade, thereby determining arbitrarily which of the sales executive might by credited with any commission.

59 All of these matters, it was said by the applicant, when coupled with the failure of the respondent to spell out all of the detail concerning the circumstances in which commission might become payable are indicative of a contract that is clearly unfair for the purposes of s 106 of the Act and are contraindicative of any proceedings that are directed merely to the enforcement of contractual terms.

60 For reasons which I have earlier advanced, it is clear on the evidence that at all times the applicant negotiated a contract of employment providing for the payment of 5% commission on sales effected by her. Given the clear evidence of Mr Georges, who negotiated that contract, I am at a loss to understand why the respondent would persist throughout the course of the proceedings in arguing that the applicant was restricted by the provisions of her contract of employment to commission at the rate of 1%. This lack of understanding is compounded by the mysterious disappearance of any relevant documentation from the applicant’s personnel file and the failure of anyone to inform the General Manager, Ms McDowell, that a 5% contract had been negotiated by Mr Georges with the applicant, as asserted by Ms McDowell in evidence in the course of the proceedings.

61 In my opinion, the applicant’s contract of employment should be varied consequent upon the finding of unfairness that I have made so that the agreed commission rate of 5% should be paid on all sales initiated by her whether or not she was substantially involved in the final execution of those sales, that the commission should be paid for a period of 12 months (a provision that the applicant conceded should apply), and that the commission should remain payable to the applicant even though on leave, whether paid or unpaid. In this latter regard, I note that the respondent would retain the benefit of the sale effected by the applicant whether or not the applicant remained actively at work. These are terms that are not contained within the applicant’s contract of employment either expressly or by implication.

62 The applicant’s contract of employment provided for termination on one week’s notice or notice provided by any applicable legislation. In my opinion, this provision was also unfair in the circumstances of these proceedings. I have earlier recounted the correspondence between the applicant and the respondent with respect to the circumstances leading up to the cessation of employment. There were allegations and counter-allegations of abandonment and failure to afford sick pay. Ultimately, however, it is clear that the relationship between the applicant and the respondent broke down when the respondent sought to impose conditions upon the applicant pertaining to her entitlement to commission which were different from those that the applicant had negotiated with the respondent and that formed part of her contract.

63 One might seek to analyse what happened in terms of whether the applicant resigned her employment or was constructively dismissed or whether the applicant abandoned her employment, as the parties differentially contended. It is also possible to analyse what occurred in terms of repudiation and rescission. However, as was observed by a Full Bench of the Industrial Relations Commission of New South Wales in Allison v Bega Valley Council (1995) 63 IR 68, what ultimately matters is what happened in a factual sense. That is, what was the real and effective cause of the breakdown of the relationship leading to the cessation of that relationship and, obviously, the cessation of the contract of employment. I would repeat the analysis that I have just made, namely the real and effective cause was the conduct of the respondent in seeking to impose terms on the applicant that were either inconsistent with or not contained within her contract of employment and that gave rise to the ultimate breakdown of the relationship. In these circumstances, the termination of the contract of employment should, in my opinion, as a matter of fairness have been attended by the payment of more than one week’s pay in lieu of notice by the respondent to the applicant. To the extent that the contract provided for a fixed term of notice no matter what the circumstances of the termination and no matter the length of service and other relevant matters it was, to that extent, unfair within s 106.

64 Having regard to the applicant’s length of service, the circumstances pertaining to the breakdown of the relationship and the cessation of the employment contract and the fact that at the time that the respondent sought to effect the termination of employment the applicant had the benefit of a medical certificate certifying unfitness for employment I would assess that an appropriate entitlement to payment in lieu of notice which was not unfair is constituted by four months notice. Not only should the applicant be entitled to receive a payment calculated by reference to that period on the basis of her salary package, but she should also be entitled to receive the benefit of commissions that would otherwise be payable to her during that four months period and beyond, extending for a 12 months period from the date that sales revenue was generated by each sale.

65 The applicant volunteered that she had mitigated her loss six weeks after her employment with the respondent had come to an end and she acknowledged receipt of payment of one week’s pay in lieu of notice. On this basis, the applicant asserted that quantification of this aspect of her claim should be based, in terms of her salary package, on five week’s pay totalling $6,250.

Calculation of commission

66 The parties had each retained accountants for the purpose of providing expert evidence concerning the calculation of commission payments. The accountants’ reports are in evidence. However, the opinions expressed by the accountants differ particularly having regard to the differential application of rates of bonus being 1% and 5% and having regard also to those accounts that each of the parties asserted attracted or did not attract (as the case may be) commission. I declined to allow court time to be taken in cross-examining the accountants until the Court had determined whether any monetary orders were to be made and their basis. Hopefully, having regard to the findings that I have made and the orders that I propose making, the accountants will be able to complete their respective tasks in a manner that is free of any controversy.

67 It was said by the parties that, in general terms, there were a number of specific accounts that were in dispute. I shall deal with each of these in turn.

(1) Outsource Australia

68 The applicant said that she was directed to this company by a senior person within the respondent organisation. She attended a director of Outsource, Mr Norgard, and convinced him that the respondent’s services should be used by that organisation. Subsequently, the applicant said she met with Mr Norgard and with Samantha Brown, the operations manager for that organisation in February 1997 and later held a number of meetings with personnel in order to establish a number of accounts. A Michelle Goyan was nominated by the respondent as the Account Manager for the Outsource organisation. In about October 1997, the applicant said that she was told by the respondent’s General Manager, Ms Karen Turner and its Sales Manager Mr McGuirk that she was not to deal with the Outsource Australia account any further because it was being handled by others within the respondent’s organisation.

69 The respondent’s evidence about this matter was given by Ms McDowell. She said that after searching the respondent’s records “the majority of the work involved in winning the account with Outsource Australia was undertaken by the Managing Director of the respondent, Colin McDowell. However, Ms Vourloumis was credited with several new accounts for Outsource Australia during the relevant period as she completed the new account process. Further, to the best of my knowledge and belief, Ms Vourloumis was credited with these accounts for the purposes of calculating both her budget and entitlement to commission.” Ms McDowell alleged that the applicant had been paid all commission entitlements in respect of those accounts.

70 I am not satisfied that the respondent has produced such evidence as is necessary to refute the more specific evidence given by the applicant. Ms McDowell does not specify the records from which she derived the relevant information. Mr McDowell swore an affidavit for the purpose of the proceedings and gave oral evidence but did not address any evidence with respect to this matter.

71 Oral evidence given by Ms McDowell in cross-examination was to the effect that wherever she asserted in her affidavit that the applicant had been “paid all her commission entitlements in respect of these accounts during her employment” she was basing such assertion on the fact that the applicant had not and did never meet the budget which had been set for her. That is, all of these assertions revolved around the existence of a budget hurdle.

72 I find that, as a matter of fairness, the applicant should be paid commission on all of the respondent’s sales to Outsource Australia, calculated at the rate of 5% extending over a period of 12 months commencing from mid-February 1997.

(2) News Limited

73 The applicant said that she was directed to make contact with this company by Mr McGuirk. In about mid-January 1997 she spoke to and later met with a Mr Ross Hines and attended upon him with Mr McGuirk. She said that she negotiated to obtain that company’s “overnight distribution work”. This was work won from the Ansett organisation. She was later told by Mr McGuirk that she was to have no further contact with News Limited with respect to that account.

74 The applicant said that in late January 1998 she received a telephone call from a person known as “George” from News Limited with respect to a tender for overnight distribution work. She attended the company offices with Mr McGuirk and met with a Mr Gerry Magill on about 4 August 1998. She had further meetings with Mr Magill in October and November 1998 and submitted a proposal for that business. In late 1999, Mr Magill telephoned her to advise that the respondent had been given the national business. At that stage, the applicant was no longer an employee of the respondent.

75 Ms McDowell admitted the applicant’s involvement in the News Limited account. She said that the applicant had been paid all commission on this account, presumably, also, on the basis that the applicant had not met the budgetary hurdle.

76 I make the same order with respect to the payment of commission on this account. It appears that the contract commenced trading in about March 1999, and the 12-month period should run from that period.

(3) Computer Associates

77 The applicant said that in late September 1997, she made contact with a Mr Lucas of this organisation, attended its offices and met with a number of representatives of the company together with Mr John Carey, the respondent’s National Administration Manager for that particular area. The applicant said that in early December 1997, the respondent was awarded the international courier business and national overnight work of Computer Associates but the implementation of the account was delayed until after she returned from maternity leave in early February 1998. The applicant said that the respondent commenced on about 1 March 1998 to undertake certain overnight business for Computer Associates and in November 1998, the respondent was given that company’s work associated with its warehouse and distribution centre.

78 Ms McDowell said in her affidavit evidence that she had caused searches to be undertaken of the respondent’s records. She noted that Computer Associates “were a major supplier to the respondent and the majority of the work involved in winning the accounts with Computer Associates was undertaken by the MIS Manager of the respondent, Hernani Inacio. However, Ms Vourloumis was credited with several new accounts with Computer Associates during the relevant period as she completed the new account process.” Ms McDowell said that the applicant had been paid commission to which she was entitled on the account, again, I infer, being in effect no commission because the applicant had not made budget.

79 The applicant should be entitled to the payment of commission on each of the international courier business and national overnight work, contracts that commenced in about March 1998, and for the warehouse and distribution centre contract that commenced after November 1998, on the same terms as previously set out.

(4) Cantarella Brothers Pty Ltd

80 The applicant said that she first made contact with this organisation in August 1998 in order to secure its overnight and local distribution business. She said that subsequently on 23 February 1999 she attended the offices of the company and was informed by a Mr Perusich that that company had decided to use the respondent. When she raised a query as to non-receipt of commission in March 1999 she was informed by a representative of the respondent that it had not secured the business of this company. Shortly after that, she had a conversation with Mr Perusich who, the applicant said, informed her that the respondent was indeed carrying on courier business for the company. There is included within the documentary evidence tendered in the proceedings a customer acceptance form dated 2 March 1999 signed on behalf of Cantarella Brothers showing an estimated weekly trading of $500.

81 Ms McDowell in her affidavit evidence said that searches that she had caused to be undertaken of the respondent’s database did not indicate any new account being opened up for this company in February 1999. She said that the company was an existing client of the respondent and the respondent’s records indicated that the applicant was not successful in securing any new trading accounts from it. There was no evidence of any trading having been recorded under the code established by the applicant. Ms McDowell said “Subsequently, another sales executives was responsible for successfully obtaining business from Cantarella Brothers Pty Ltd.”

82 The forensic accountants retained by the parties were unable to identify any specific material in the respondent’s records which would assist in resolving this matter. The claim brought by the applicant is, I assume, one based on a general assertion of trading of $500 per week leaving a nett commission of $1,300.

83 I am unable to determine on the basis of the evidentiary material before the Court whether the respondent has complied with its obligations to discover all relevant material and whether the applicant has made out a case with respect to this particular account.

84 I propose to reserve leave with respect to this matter, as is the case with other particular accounts.

(5) Qantas Limited

85 By memo dated 19 June 1997, Mr McGuirk asked the applicant to follow a number of accounts which were to tender. He said, in part, that: “....we need to build a relationship so that we are provey (sic) to offers.” One of the accounts was Qantas. On 18 September 1997, the applicant wrote to Qantas for the attention of Julie Berry named as “Purchasing Executive” introducing the respondent, enclosing information about the respondent and seeking further contact.

86 Subsequently, the applicant said that she met with Ms Berry and the respondent tendered for the Qantas work in Victoria in early 1998, but was unsuccessful. The applicant said that she retained contact with Ms Berry, was advised that the Victorian tender was 10 - 15% more costly than “the rate” but that the Sydney work was also to be reviewed and to be the subject of a tender.

87 Later in 1998, the applicant said she was informed by Mr Georges that the respondent had secured the Qantas work by tender. The applicant said that she had a number of conversations with Mr Georges concerning entitlement to commission for the Qantas work and that Mr Georges agreed that she would be paid. Mr Georges, in his affidavit, denied those conversations.

88 There is also a suggestion in the evidence of Mr Georges that would tend to minimise the involvement of the applicant in securing the Qantas Sydney work.

89 It was the evidence of Ms McDowell that it was the policy and practice of the respondent that where work was gained by way of a tender process, and the executive sales person was not involved in the tender documentation, then no commission was payable. My impression of the evidence is that it would be very rare for the sales executive to be substantially involved in the actual preparation of tender documentation.

90 My understanding of the evidence with respect to the Qantas account highlights the unfairness associated with the lack of detail provided by the respondent as to the manner in which the entitlement to commission payments would arise. On the one hand, a person in the position of the applicant might be justified in assuming that where she or he was involved in an “initial introduction” even in circumstances involving a tender process and the consideration of and preparation of a tender document was undertaken by someone else, nevertheless commission would be payable on sales gained. However, one may sympathise with the position of the respondent in these circumstances in terms of the payment of a commission of 5% where a substantial part of the work undertaken in gaining the account was performed at a more senior level in the organisation. This is a matter that was not discussed between the parties prior to the making of the contract of employment and does not seem to have been subject of a discussion in terms of any engagement by differing minds after the contract of employment was made. As I have said, it highlights the unfairness that attended the contract of employment, the circumstances in which it was made and the manner in which it operated. It highlights also, to some extent, the unfairness of the contract in terms of the conduct of the respondent.

91 It is a trite observation that there are no objective scientific criteria available by which a judge may assess what as a matter of fairness should govern a particular situation. I adhere to the view that in making the requisite value judgment as to what is unfair and, in a correlative sense, what is fair between the parties, one must approach the matter by reference to “good common sense” so as to reflect community values and community standards. Doing the best that I can in the circumstances, I would determine that as a matter of fairness, and so as to avoid a situation which was unfair, the applicant should be entitled to commission at the rate of 1.5% on the Sydney Qantas account for a period of 12 months, or such shorter period as the account was retained by the respondent.

(6) AMP

92 This matter is more clear-cut. The applicant was in contact with AMP and assisted Mr McGuirk in tendering for its work. That tender was unsuccessful. The tender was in fact won by Australian Air Express. That organisation arranged on a subcontract basis for some of the work that it had contracted to perform for AMP to be undertaken by the respondent. The applicant was not involved in any way in securing the subcontract work. On this basis, I conclude that the applicant has no entitlement to derive any commission from AMP work performed as a subcontractor by the respondent.

(7) Perpetual Trustee Limited

93 This was an existing client of the respondent. However, as a result of an approach by its account manager, the applicant negotiated for the respondent to undertake additional work being interstate, overnight work. It was the understanding of the applicant that the respondent gained this work and that the respondent enjoyed sales from that work after the applicant’s employment was terminated.

94 The evidence of Ms McDowell was that no new accounts were opened for Perpetual Trustee during 1999 and that no new accounts were gained by the respondent until after the applicant’s employment had ceased. Despite this, there appears to be reference in the forensic accounting material to additional business having been gained.

95 Consistent with the determination that I intend making, the applicant should be entitled to commission at the rate of 5% on all overnight, interstate business carried out by the respondent for this company for a period of 12 months commencing when that contract commenced in the course of 1999.

(8) Westpac Banking Corporation

96 The applicant said that in early June 1998, after attendance by her upon representatives of this bank, the respondent secured the “local courier business” in the Sydney area. Ms McDowell has said that searches that she has caused to be made did not reveal the opening of new accounts for that bank in periods August 1997 and August 1998. Why Ms McDowell chose those periods is not revealed. In any event, the forensic accounting information seems to indicate that there was a relevant account traded at $402. If this is correct, the applicant’s commission would be of the order of $2. Hopefully, the parties will be able to reach some sensible agreement about this matter.

(9) Hutchinson Telecommunications

97 The applicant said that following a telephone conversation with a representative of this company in February 1999, she arranged to attend at its offices in Melbourne. When she advised Mr McGuirk of this, she said that he forbad her to travel to Melbourne on the basis that only he or Mr Georges were allowed to travel interstate. Mr McGuirk subsequently attended on this company at its Melbourne offices and secured a contract.

98 Ms McDowell said in her evidence that her search of the respondent’s records indicated that the applicant was not successful in securing any new accounts from this company and the respondent did not gain any new business from that company during the relevant period. However, an accountant appears to have identified trading of $2,109.

99 As is the case with other accounts to which I have referred, Ms McDowell’s evidence, in my opinion, appears to be unreliable because assertions are made by her to the effect that no sales were gained by the respondent from this account, contrary to material which appears to have been identified by at least one accountant. I shall refrain from making any further comment about this matter pending any further proceedings that may be necessary to finally determine the amount of any commission payable.

100 Again, the circumstances of this account highlight the unfairness surrounding the negotiations concerning entitlement to commission. Furthermore, the prohibition on interstate travel would, prima facie, unfairly preclude a sales executive from deriving commission as a result of an initial introduction obtained by her or him.

101 I would find that as a matter of fairness, the applicant should be entitled to commission at the rate of 5% on all sales effected through this company during the relevant period.

(10) Ernst and Young

102 The applicant said that in about February 1999, she called the National Procurement Manager of that organisation and as a result forwarded some documentation to her. The applicant then received a tender document from Mr McGuirk who asked that she complete it, which she attended to, personally delivering it to their offices on 21 April 1999. The applicant said that she had a number of discussions with the Ernst and Young representative during this period because of concerns about some matters of detail including Y2K compliance. The applicant was then asked to attend a meeting at Ernst and Young on 17 May 1999, and Mr McGuirk insisted that he attend that meeting. At that meeting there was discussed not only Sydney work of Ernst and Young but also national work. Accordingly, the applicant forwarded further information to Ernst and Young including Sydney courier rates, Melbourne courier rates and a “GPO run”.

103 The applicant said that she was informed by Mr McGuirk and Ms McDowell that the respondent obtained the Ernst and Young accounts about six weeks after her employment was terminated.

104 Ms McDowell said that she caused a search to be made of the respondent’s records. This was said to reveal that the applicant was not successful in securing any new accounts during the period of her employment with the respondent. Furthermore, she said the respondent did not obtain any new accounts from that organisation until after the applicant’s employment had come to an end. As a result it was said that the applicant was not entitled to receive any commission in respect of these accounts.

105 As I understand the evidence of Ms McDowell, a reason for determining that the applicant was not entitled to commission was that she was no longer employed at the time that sales were earned by the respondent from Ernst and Young work. The accounting evidence would seem to quantify the Ernst and Young account as having traded in the sum of $109,395.

106 Consistent with the variation of the contract of employment that I intend making and consistent also with the orders that will be made, the applicant should be paid commission at the rate of 5% on these Ernst and Young sales during the relevant period of 12 months from the date of the sale.

The amount of commission paid to date

107 The applicant asserts that commission payments received by her from the respondent totalled $10,428.74. This is consistent with documentation tendered in the proceedings. The respondent asserts that the applicant has received by way of commission $20,520.44 paid both by cheque and electronic funds transmission. The respondent is unable to produce any documentation evidencing payments in this amount. I accept the applicant’s evidence that the only payments received by her are those that she asserts. The respondent having failed to prove by any documentation any further payments, the applicant should give credit only for the sum of $10,428.74.

108 In the further conduct of the proceedings it will be necessary for the parties to give consideration to the calculation of the monies which I have determined as a matter of principle are payable by the respondent to the applicant. In this regard the parties have had access to the respondent’s records and have had the assistance of accountants engaged by each of them to undertake an examination of the respondent’s records. Hopefully, it will be a simple matter of the parties and their legal representatives reaching sensible agreement about the quantum of the monies payable by the respondent to the applicant pursuant to the in-principle determination that I have made.

109 In the unlikely event that such sensible agreement cannot be reached, I grant liberty to apply. Any outstanding contentious matters may then by the subject of further proceedings.

Costs and interests

110 The parties agreed that costs should be reserved and I shall do so. It will not be possible to consider the question of interest until the final quantification of any monies payable by the respondent to the applicant.

Orders

111 Consequent upon the findings of unfairness that I have made I make the following orders:

1) The contract of employment between the applicant and respondent is varied to provide that notwithstanding any provisions to the contrary, the respondent is to pay to the applicant commission calculated at the rate of 5% of the quantum of all sales earned from clients of the respondent with respect to courier work secured by the applicant substantially through her efforts, such commission to be payable for a period of 12 months after such work has commenced to be performed, such variation to take effect from the commencement of the applicant’s contract of employment with the respondent.
2) Otherwise the contract of employment is varied to provide for a lesser rate of commission to be determined to reflect the contribution made by the applicant in securing a sale and having regard to the contribution made by others in finalising any necessary processes with respect to any such sale.
3) The contract of employment is further varied as and from 19 May 1999 to provide that the respondent will pay four months’ pay in lieu of notice on termination.
4) The proceedings are stood over to allow the parties to reach agreement concerning the quantum of monies that I have found should be paid by way of just compensation to the applicant by the respondent.
5) Costs and the quantification of interest are reserved.

6) Liberty to apply.

LAST UPDATED: 15/12/2006