A Barbakh v Jewish Care (Victoria) Inc
[2014] FWC 1775
•14 MARCH 2014
[2014] FWC 1775
The attached document replaces the document previously issued with the above code on 14 March 2014.
Footnote 68 is amended to read [2012] FWAA 4091.
Janet Hall
Associate to Deputy President Kovacic
Dated 19 March 2014.
[2014] FWC 1775 |
FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
A. Barbakh
v
Jewish Care (Victoria) Inc
(U2013/11603)
DEPUTY PRESIDENT KOVACIC | MELBOURNE, 14 MARCH 2014 |
Application for relief from unfair dismissal - not genuine reduduncy - harsh, unjust and unreasonable - compensation ordered.
[1] On 8 July 2013 Mrs Anna Barbakh (the Applicant) filed an application under s.394 of the Fair Work Act 2009 (the FW Act) alleging that the termination of her employment by Jewish Care (Victoria) Inc (the Respondent) on 1 July 2013 was harsh, unjust or unreasonable.
[2] The Respondent raised two jurisdictional objections to the application. First, the Applicant’s employment was terminated as a result of genuine redundancy as defined in s.389 of the FW Act. Second, and in the alternative, the Applicant’s employment was not terminated at the Respondent’s initiative.
[3] Following several postponements at the request of one or other of the parties, the matter was heard on 31 January 2014.
[4] Mr Gary Pinchen appeared with permission for the Applicant and Mr David McLaughlin appeared with permission for the Respondent.
[5] The Applicant gave evidence. Ms Wendy Hodson, Mr Daniel Goodman and Ms Maureen Flaherty gave evidence for the Respondent.
[6] I have found that Mrs Barbakh’s termination was not a genuine redundancy and that it was harsh, unjust and unreasonable. As to remedy, I do not consider reinstatement appropriate and have ordered the payment of compensation of $5632.56 less applicable tax, which is equivalent to 4 weeks’ salary, plus 9.25% superannuation to the Applicant.
Background
[7] The Applicant commenced her employment with the Respondent on 1 December 2000. It was not disputed that the Applicant was protected from unfair dismissal at the time of the termination.
[8] The Respondent is a not-for-profit organisation and the largest provider of aged and community services for the Jewish community in Victoria. 1
[9] At the time of her termination, the Applicant was employed as a Loans Officer and Finance Administration Assistant. She had been performing this joint role since June 2006 and, in very general terms, roughly divided her time equally between the roles (though the amount of time devoted to each role would fluctuate depending on workload).
[10] From late 2012 to mid-2013, the Respondent undertook a review of its finance functions while a restructure was also underway in the Respondent’s Community Services Division. The outcome of the review/restructure was that “new models for service delivery in both departments resulted in newly created roles requiring different skills sets and competencies” 2 for which the Respondent submitted the Applicant was not qualified. This is disputed by the Applicant. Specifically, the review/restructure saw the Loans Officer dimension of the Applicant’s role moved into “a multi-skilled micro-finance team within the Individual & Family Support (IFS) Services Program in the Community Services Division” and resulted in the Finance Administration Assistant activities no longer being “required in the new Finance Division structure.”3
[11] The Applicant was called to a meeting with Ms Wendy Hodson, Human Resources Manager; Mr Daniel Goodman, Chief Financial Officer; and Ms Maureen Flaherty, General Manager - Community Services, on 1 July 2013. At that meeting the Applicant was informed, inter alia, that her roles had become redundant as a result of the review/restructure and that she could either work through her notice period of five weeks and try and secure an alternative role during that period or take a redundancy package immediately or at any stage of the notice period. A letter to that effect and also sating that her notice period comeenced that day was provided to the Applicant at the meeting. 4 It is not disputed that the Applicant was unaccompanied at that meeting.
[12] At the suggestion of the Respondent, the Applicant went home after the meeting but returned the following day to collect her belongings. She elected to take a redundancy package immediately.
[13] In total six positions were made redundant as part of the restructure, with three employees (including the Applicant) having their employment terminated and given redundancy payouts. 5
The submissions of the Applicant
[14] In short, the Applicant submitted her termination was not a genuine redundancy as “there was a complete absence of consultation.” 6 It was further submitted “it would have been reasonable to redeploy the applicant either immediately or with some training.”7 These submissions went to the first of the Respondent’s jurisdictional objections. As to the Respondent’s second jurisdictional ground, i.e. the Applicant’s employment was not terminated at the Respondent’s initiative, it was submitted that “the objection that there was no dismissal is baseless on any view of the facts.”8 Specifically, the Applicant submitted that there was no resignation as the “respondent informed the applicant that it was her choice whether she worked out the notice period or was paid in lieu of notice.”9
[15] As to remedy, the Applicant sought “reinstatement, payment of lost wages and an order for continuity” or, in the alternative, compensation of $39,902.72. 10
[16] At the hearing on 31 January 2014 the Applicant tendered material showing that she had unsuccessfully applied for more than 200 positions since her termination. 11
The Applicant’s evidence
[17] The Applicant’s evidence was that in February 2013 Ms Flaherty had informed her that consideration was being given to incorporating the loans function in the Community Services Division but that subsequently nothing changed and she continued to report to Finance. The next development involved the Applicant being called to the abovementioned meeting on 1 July 2013 where she was informed of the changes arising from the review/restructure and that her position was redundant. The Applicant attested that prior to the meeting she “believed this meeting to be another routine meeting.” 12 The Applicant further attested that she was informed at that meeting that she could not be offered any alternative position and that she “could work out the notice and see if any other jobs came up but Maureen [Ms Hodson] said she was sure there were no other jobs coming up.”13 The Applicant returned to the office on 2 July 2013 to collect her belongings but at the request of Mr Goodman agreed to teach the person whose role would in future incorporate her finance functions “how to do reconciliations, retention for bonds, and other things that I used to do for accounts.”14
[18] The Applicant further attested that she believed she performed all the key deliverables of the new full-time Finance Officer - Community Services and Shared Services role which was advertised on 23 August 2013 and which she unsuccessfully applied for. While the Applicant acknowledged that she did not have a finance qualification, she did indicate that she “would have been willing to undertake appropriate courses if required.” 15 The Applicant also attested that she understood “that a person from an agency was doing my old role in finance after I left for a period” and she “could have done that job in the interim.”16
[19] Finally, the Applicant attested that she considered her termination “was personal” as Ms Flaherty did not like her as a result of a couple of interactions where they had “locked horns.” 17
[20] In her supplementary statement 18, Mrs Barbakh disputed a number of claims made in the witness statements of Ms Hodson, Mr Goodman and Ms Flaherty.
[21] Under cross examination the Applicant:
(a) stated that she was contacted while on sick leave by Mr Goodman on 27 June 2013 to advise her of a meeting the previous day in the Community Services Division to discuss changes and indicating that he would meet with her on her return to work to advise her of those changes; 19
(b) added that she had not been informed in that conversation that she could bring a support person to that meeting or that her job was at risk; 20
(c) indicated that she chose not to work through her notice period as she felt that at the 1 July meeting “they made clear to me they don’t want me there so I decided not to come back” 21, adding later that she made it clear on 1 July that “I’m coming in tomorrow to pick up my stuff and I’m not working anymore”22;
(d) reiterated her belief that her termination was a result of Ms Flaherty disliking her; 23
(e) stated that meetings of the Finance Department on 29 April and in May and June 2013 did not involve any discussion which made it clear that her position would “be gone” 24; and
(f) expressed the view that she should have been appointed to the Finance Officer - Community Services and Shared Services position over the successful candidate on the basis that she had more experience as it was “exactly the job which I used to do but less.” 25
The submissions of the Respondent
[22] The Respondent submitted that the application should be dismissed as the termination was as a result of genuine redundancy as the job performed by the Applicant, i.e. Loans Officer and Finance Administration Assistant, was no longer required to be performed by anyone. It was further submitted that the Applicant had been consulted over a period of approximately six months in relation to the restructure of the Finance Department and at the time of the termination there were no roles to which the Applicant could be reasonably redeployed, though the Respondent intended to consider any redeployment opportunities which arose prior to 2 August 2013 (i.e. during the notice period). In the alternative, the Respondent submitted that the termination was not at the Respondent’s initiative as the Applicant had chosen not return to work on 3 July 2013. 26
[23] The Respondent also submitted that it had complied with its obligations in respect of consultation, highlighting the various meetings in April, May and June 2013 where the restructure of the finance area was discussed and the meeting of 1 July 2013 together with the invitation made at the 1 July meeting to further discuss the issue with Ms Hodson. In the event that the Commission found to the contrary, it was submitted that “this was a simple procedural error that, if fully complied with, would only have delayed the redundancy and subsequent termination of the Applicant’s employment by a couple of days. Further ... it is submitted that any procedural error at the conclusion of the process falls short of rendering the termination unfair.” 27 In support of its submission, the Respondent cited Vice President Watson’s decision in Maswan v Escada Textilvertrieb T/A ESCADA (Escada)28. However, the Respondent also submitted that were the Commission to prefer the view of the Full Bench in UES (Int’l) Pty Ltd v Leevan Harvey (UES)29any remedy should be limited “to a matter of days.”30
[24] With regard to the criteria set out in s.387 of the Act, the Respondent submitted that the most relevant criterion was that at s.387(h), reiterating its previous submissions in respect of consultation and redeployment. The Respondent also submitted that in respect of s.387(d), the Applicant had been told prior to the meeting of 1 July 2013 that she could have a support person present. 31
The Respondent’s evidence
[25] Ms Hodson, Mr Goodman and Ms Flaherty all provided statements, with all but Ms Flaherty also providing a supplementary statement. The initial statements of all three were essentially a description of the 1 July 2013 meeting with the Applicant. Points of note include:
(a) Ms Hodson indicating to the Applicant that “there was a five week notice period which she could choose to work out fully, partially or not at all and regardless of whether or not she worked out the notice period, if she wanted to seek redeployment within the organisation I would support her do that” 32; and
(b) Mr Goodman stating that after the 1 July 2013 meeting he locked IT access to Mrs Barbakh until she returned to the office “to protect sensitive client data”, the Applicant had presented for work on 2 July 2013 and had performed “a limited handover of data” after Mr Goodman had re-enabled IT access but left without indicating whether or not she would work out the notice period, did not present for work on 3 July 2013 and when contacted by him later that day confirmed that she would not be working out the notice period. 33
[26] Mr Goodman in his supplementary statement briefly set out the background to the restructure of the Respondent’s Finance Department and the series of meetings with staff in April, May and June 2013 where the restructure was discussed. Of note, Mr Goodman attested that at the 29 April 2013 meeting with Finance staff “I explained the changes which were going to take place, including highlighting that three staff members, including Mrs Barbakh, would be impacted by the changes.” 34
[27] In her supplementary statement, Ms Hodson set out the impact of the changes in the Finance Department and IFS team in broad terms and on affected individuals. Key aspects of her supplementary statement include:
(a) the role of Finance Officer - Community Services and Shared Services “whilst anticipated ... was not realised until the full extent of the restructure was completed and the announcements made to all affected staff” 35;
(b) the Applicant was not considered suitable for redeployment to the position as “she did not meet the key selection criteria and did not have the financial qualifications. Mrs Barbakh’s experience was limited to administration of loans and low level finance administration activities. The new role required broader financial experience and a formal accounting qualification” 36;
(c) she believed the Applicant was genuinely surprised when informed of her redundancy at the 1 July 2013 meeting 37;
(d) she had been informed by Mr Goodman that he had verbally informed the Applicant she could bring a support person to the 1 July 2103 meeting 38;
(e) that “to the extent that anyone was engaged from an agency, it was simply to assist with the backlog from the end of financial year” 39; and
(f) her view that the Applicant’s termination was in no way related to any issues between the Applicant and Ms Flaherty. 40
[28] Under cross examination some important aspects of this evidence were contradicted. In particular, Mr Goodman:
(a) stated that at the 29 April 2013 meeting of the Finance staff he did not specifically identify Mrs Barbakh as being affected by the restructure 41;
(b) confirmed that Mrs Barbakh was not advised that her job may disappear as a result of the restructure until the meeting of 1 July 2013 42; and
(c) further stated that he had could not recall offering Mrs Barbakh the opportunity to bring a support person to the 1 July 2013 meeting, believing that someone else (not specified) had done so. 43
[29] Under cross examination Ms Hodson stated that:
(a) the driver for the restructure was business improvement, adding that in respect of the finance restructure “there had been a lot of feedback from the business that they weren’t getting the support and the level of support and the capability of staff was not matching the needs of the business in the support that they required” 44;
(b) the position description for the role of Finance Officer - Community Services and Shared Services was still being developed at the time of the 1 July 2013 meeting and was not finalised until August 2013 45;
(c) the Applicant was not interviewed for that role based on advice from Mr Goodman that he considered there were a number of areas where she did not meet the selection criteria 46;
(d) while she had been informed that the Applicant’s employment was likely to be terminated “a week or two before” the Applicant was advised of this, it was decided to wait until the Respondent’s Board had signed off on the restructure before discussing with affected employees 47;
(e) she had been informed by Mr Goodman that the Finance Department had engaged a contractor after the Applicant had been terminated, acknowledging that had Mrs Barbakh “worked out her notice period she may have well done that work” 48;
(f) she had not been asked by Ms Flaherty “to get rid of” the Applicant 49;
(g) it was the organisation’s preference that the Applicant worked out her notice period 50; and
(h) there was no opportunity to consult with the Applicant regarding the organisational change between the restructure being signed off by the Respondent’s Board on 25 June 2013 and the meeting of 1 July 2013 51.
[30] Beyond the evidence cited at paragraph [28] above, under cross examination Mr Goodman stated that:
(a) the rationale for creating the role of Finance Officer - Community Services and Shared Services “was that we felt there wasn’t enough business partnering going on within the organisation so one of the reasons ... was to create a business partner role for the community services role which we felt had been poorly serviced previously” 52;
(b) the role “was a very different role to what the applicant had performed previously”, to support that view Mr Goodman highlighted several of the role’s key accountabilities which he did not consider the Applicant had performed/demonstrated, i.e. full end-to-end monthly reconciliations, an understanding of the regulatory requirements underpinning Jewish Mutual Loans (JML) and, in respect of administering accounts receivable (including JML), “there was no evidence of proper aging and collection in terms of loans” while the Applicant had performed that task 53;
(c) as the role involves collecting debt and performing end-to-end monthly reconciliations it required someone with finance qualifications, though not necessarily a certified practising accountant 54;
(d) he was aware of the Respondent’s obligation to consult and indicated that it would have done so on 26 June 2013 had the Applicant not been absent from work due to illness on that day, adding that the purpose of that meeting would have been to meet with the Applicant prior to the general meeting of the IFS team to advise that the restructure of the area would affect her role and to canvass “next steps in terms of looking for redeployment opportunities within Jewish Care, should those opportunities have existed” 55;
(e) the Respondent’s Board “had approved a restructure of the finance team in February” 2013 and that he had formed the view at that time that the Applicant would not be suitable to perform any of the roles in the restructured area 56;
(f) he did not consider the Applicant able to perform the work undertaken by the temporary staff member for the end of year financials 57;
(g) there was “Probably not much scope” for changing the outcome in terms of the restructured role 58; and
(h) consultation with the Applicant would have occurred and possible redeployment opportunities explored had she worked out the notice period, though he was not aware of any suitable positions arising over this period 59.
[31] Finally, Ms Flaherty under cross examination:
(a) stated that in terms of the JML role “...part of the brief and direction of the Board was to grow financial counselling ... We also needed to multi-skill, because again we had this - only one person knew saver-plus, JML counselling and ... we actually had to market and build that service. So Anna’s [the Applicant] capacity to do the financial counselling role - her skill set wasn’t suitable” 60;
(b) confirmed that she had not had any conversation with the Applicant regarding the changes to the IFS structure prior to the 1 July 2013 meeting 61;
(c) implied a limited scope to alter the decision regarding the IFS structure when she said “Well, there’s always scope to change, but ...” 62;
(d) indicated that there were no redeployment opportunities available for the Applicant as at 1 July 2013 and that none subsequently arose in her area 63; and
(e) disagreed strongly with the proposition that the Applicant’s termination was in any way related to her “run-ins” with the Applicant 64.
[32] The Respondent wrote to the Commission, copied to the Applicant’s representative, on 5 February 2014 providing further information on two issues touched on during the course of the hearing. The first issue relates to the engagement of the contractor by the Respondent while the second concerns what, if any, qualifications are required to work in the Respondent’s aged, home care and disability support areas.
[33] On the first issue, the Respondent advised that a contractor “was engaged from 4 August 2013 until 13 September 2013 to provide support to the finance team following a backlog of work at the end of financial year.” The contractor “had accounting qualifications and was therefore able to fill a gap in the business whilst the Financial Controller was absent due to illness.”
[34] As to the second issue, the Respondent advised that “all aged and home care workers must have obtained a Certificate III in Aged Care, and all disability support workers must have obtained at least a Certificate IV in Community Services Disability.”
The statutory framework
[35] The Commission exercises its discretion in relation to an application for an unfair dismissal remedy pursuant to Part 3-2 of the Act. In this case there is no contest that the Applicant is a person who is protected from unfair dismissal pursuant to s.382 of the Act. In the context of this matter, the relevant provisions of the Act are ss. 385, 387 and 389 which read as follows:
385 What is an unfair dismissal
A person has been unfairly dismissed if FWC is satisfied that:
(a) the person has been dismissed; and
(b) the dismissal was harsh, unjust or unreasonable; and
(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.
Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.
387 Criteria for considering harshness etc.
In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, FWC must take into account:
(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and
(b) whether the person was notified of that reason; and
(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and
(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal; and
(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(h) any other matters that FWC considers relevant.
389 Meaning of genuine redundancy
(1) A person’s dismissal was a case of genuine redundancy if:
(a) the person’s employer no longer required the person’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise; and
(b) the employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.
(2) A person’s dismissal was not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within:
(a) the employer’s enterprise; or
(b) the enterprise of an associated entity of the employer.
[36] There is no dispute that the Applicant was dismissed, so s.385(a) of the Act is satisfied. The Applicant contends that her termination was harsh, unjust or unreasonable, so s.385(b) is relevant. The Respondent is not a small business employer, therefore s.385(c) is not relevant. The Respondent contends that the termination is a case of genuine redundancy, so s.385(d) applies. Therefore, in determining whether the Applicant was unfairly dismissed, I must consider whether the dismissal was harsh, unjust or unreasonable as per s.385(b) and whether the termination was a case of genuine redundancy as per s.385(d).
The Respondent’s second jurisdictional objection
[37] Before dealing with the issue of whether or not the termination was a genuine redundancy (the first jurisdictional objection), I would like to deal with the Respondent’s second jurisdictional objection, i.e. the Applicant’s employment was not terminated at the Respondent’s initiative.
[38] The wording of the letter provided to the Applicant at the 1 July 2013 meeting is particularly relevant in the regard. The letter states:
- Your five week notice period starts today
- You can choose to:
“...
o Take the redundancy package, immediately, or at any time in the next five weeks; ...” (underlining added) 65
[39] Further, the evidence of Ms Hodson referred to at paragraph [25](a) above was that she had indicated to the Applicant at the 1 July 2013 meeting that “there was a five week notice period which she could choose to work out fully, partially or not at all and regardless of whether or not she worked out the notice period, if she wanted to seek redeployment within the organisation I would support her do that.”
[40] Against that background, the jurisdictional objection is simply not sustainable on any basis. To suggest that the termination was not at the Respondent’s initiative is, in my view, to transgress into the world of fiction given the evidence that it was made clear both at the 1 July 2013 meeting and in the letter given to the Applicant at that meeting that she was under no obligation to work out the notice period. Despite it being the Respondent’s preference that the Applicant work out her notice period, the fact that she decided to take a redundancy package immediately and not work out the notice period in no way alters the fact that the termination was at the initiative of the Respondent.
[41] Accordingly, the second jurisdictional objection is dismissed.
The Respondent’s first jurisdictional objection - was the termination a genuine redundancy?
[42] Section 389 deals with the meaning of genuine redundancy. I will deal with each of the factors set out in s.389 separately.
The employer no longer required the person’s job to be performed by anyone because of changes in the operational requirements of the enterprise [s.389(1)(a)]
[43] The evidence of Ms Hodson, Mr Goodman and Ms Flaherty highlighted the business rationale underpinning the changes in the Respondent’s Finance and Community Services areas. Those changes resulted in the Loans Officer dimension of the Applicant’s role becoming part of the newly created Finance Officer - Community Services and Shared Services role and in her Finance Administration Assistant activities no longer being required in the new Finance Division structure.
[44] On this factor the Applicant submitted that “It was finance - a point 5 per cent role in reference to the loans and that role, in that regard, does not exist and I agree with that.” 66 However, the Applicant also went on to suggest that her termination was in part related to her run-ins with Ms Flaherty and that, against the background of the review/restructure of the Finance and Community Services areas, the Respondent had “taken advantage of that situation to exit her.”67
[45] On the issue of whether or not the relationship between Ms Flaherty and the Applicant was a factor in the termination, in view of the extensive evidence as to the rationale underpinning the changes, there is no basis to doubt Ms Flaherty’s evidence to the effect that it was not a factor.
[46] Drawing on all of these factors, I find that the Applicant’s termination was as a result of the Respondent no longer requiring the Applicant’s job to be performed by anyone because of changes in the operational requirements of the enterprise.
The employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy [s.389(1)(b)]
[47] The Respondent is covered by the Jewish Care Victoria - Social, Community, Home Care, Disability, Health Professionals and Support Services Enterprise Agreement 2011 - 2014 68 (the Agreement). The Agreement’s consultation clause is as follows:
“5 Consultation
5.1 Employer to notify
Where Jewish Care has made a definite decision to introduce major changes in program, organisation, structure or technology that are likely to have significant effects on employees, the Employer shall notify the employees who may be affected by the proposed changes. The employees affected by this change may choose to appoint a representative, which may be a representative from a Union.
a) Significant effects include termination of employment, major changes in the composition, operation or size of the employer's work-force or in the skills required; the elimination or diminution of job opportunities, promotion opportunities or job tenure; the alteration of the hours of work; the need for retraining or transfer of employees to other work or locations and the restructuring of jobs. Provided that where the award makes provisions for alteration of any of the matters referred to herein an alteration shall be deemed not to have significant effect.
5.2 Employer to discuss change
a) The Employer shall discuss with the employees affected inter alia and their representative, the introduction of changes referred to in Clause 5.1, the effects the changes are likely to have on employees, measures to avert or mitigate the adverse effects of such changes on employees and shall give prompt consideration to matters raised by the employees and or their representative in relation to the changes.
b) The discussion shall commence as early as practicable after a definite decision has been made by the Employer to make the changes referred to in Clause 5.1.
c) For the purposes of such discussion, Jewish Care shall provide in writing to the employees concerned and their representative, all relevant information about the changes proposed; the expected effects of the change on employees and any other matters likely to affect employees provided that the employer shall not be required to disclose confidential information the disclosure of which would be contrary to the employer's interests.”
[48] As noted by Watson VP at paragraph [19] in Escada:
“The requirement to discuss proposed changes and consult about the changes has been held to require meaningful consultation and not merely an afterthought. Consultation after an irrevocable decision has been made has been held to not amount to meaningful consultation.” (references not included)
[49] Under cross examination Ms Hodson acknowledged that the Respondent did not consult the Applicant regarding the impact of the changes to the Finance and Community Services areas and possible measures to avert or mitigate that impact. While the Respondent indicated that it saw the notice period as an opportunity to undertake this consultation and explore redeployment opportunities, this is inconsistent with its obligations under the Agreement. Based on the evidence, there could have been consultation with the Applicant regarding the impact of the Finance restructure on her following Board sign off of that restructure on 25 February 2013. Further, given Ms Hodson’s evidence that the position description for the role of Finance Officer - Community Services and Shared Services was still being developed at the time of the 1 July 2013 meeting and was not finalised until August 2013 it is not apparent why the Respondent did not seek to consult with the Applicant prior to giving her notice. At one level, there seemed to be an extraordinary haste in informing the Applicant that she was to be made redundant and giving her notice. This is despite the Respondent’s consultation obligations under the Agreement, something Mr Goodman acknowledged under cross examination that he was aware of.
[50] It follows that the Applicant’s termination was therefore not a genuine redundancy as defined in the Act and that the application cannot be dismissed on that basis.
[51] Having said that, however, I accept the Respondent’s evidence that in the light of the Board decisions on the respective restructures there was little prospect of consultation with the Applicant or her representative altering what had been decided.
Would it have been reasonable in all the circumstances for the person to be redeployed within the employer’s enterprise or the enterprise of an associated entity of the employer? [s.389(2)]
[52] The Applicant’s evidence was that she believed that she should have been appointed to the Finance Officer - Community Services and Shared Services position on the basis of her experience. On the other hand, Mr Goodman’s evidence set out those aspects of the role which he considered the Applicant had neither performed nor demonstrated and why the role required someone with finance qualifications. Mr Goodman further attested he did not consider the Applicant able to perform the work undertaken by the temporary staff member for the end of year financials. This was reinforced in the correspondence provided on the Respondent’s behalf on 5 February 2014. Finally, the Respondent’s evidence was that as at 1 July 2013 there were no redeployment opportunities in either the Finance area or the Community Services Division for which the Applicant was considered suitable and that no such opportunities subsequently arose.
[53] As recently noted by the Full Bench in Technical and Further Education Commission T/A TAFE NSW v L. Pykett (TAFE NSW) 69:
“[40] The Commissioner ... failed to make a finding that there was a job, a position or other work to which Ms Pykett could have been redeployed. Such a finding is a necessary step in reaching a conclusion that it would have been reasonable in all the circumstances for Ms Pykett to be redeployed within the appellant’s enterprise.”
[54] Based on the material before me, I am not satisfied that that there was a job, a position or other work to which the Applicant could have been redeployed. Following the approach in TAFE NSW, I am therefore unable to conclude that it would have been reasonable in all the circumstances for the Applicant to be redeployed within the employer’s enterprise.
Was the dismissal harsh, unjust or unreasonable?
[55] In considering whether a dismissal was harsh, unjust or unreasonable, the Act requires the Commission to have regard to the criteria set out in s.387. I will address each of those criteria separately.
(a) Whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees)
[56] I have previously found that the reason for the termination was that the Respondent no longer required the Applicant’s job to be performed by anyone because of changes in the operational requirements of the enterprise. As a result, the termination cannot reasonably be described as related to the Applicant’s capacity or conduct, though it is arguable that the Applicant’s capacity was a consideration in terms of possible redeployment opportunities. Hence this criterion is not relevant to the fairness of the termination.
(b) Whether the person was notified of that reason
[57] It follows from the above that this factor is not relevant
(c) Whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person
[58] It follows from the above that this factor is not relevant.
(d) Any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal
[59] As previously noted, no invitation was extended to the Applicant to bring along a support person to the 1 July 2013 meeting if she wished to do so. The evidence of Ms Hodson and Mr Goodman is that each thought someone else had discussed this with the Applicant.
(e) If the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal
[60] The termination does not relate to unsatisfactory performance.
(f) The degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal
[61] The Respondent is a large employer with an in-house human resource function.
(g) The degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal
[62] As noted above, the Respondent is a large employer with an in-house human resource function.
(h) Any other matters that FWC considers relevant
[63] I have previously found at paragraph [50] that the Applicant’s termination was not a genuine redundancy as defined in the Act based on the Respondent’s failure to consult in accordance with its obligations under the Agreement. Further, as previously noted, I am unable to conclude that it would have been reasonable in all the circumstances for the Applicant to be redeployed within the employer’s enterprise.
[64]
In Escada Watson VP found the failure to consult did not render the dismissal unfair. 70 More particularly, Watson VP stated:
“[39] In my view a decision to dismiss on account of redundancy will only be harsh, unjust or unreasonable if the rationale for the decision is seriously undermined or if there is a serious error in procedure such that renders the termination unfair in the circumstances ... The failure to consult is not a trivial matter. But as it is clear that consultation was highly unlikely to have negated the operational reasons for the dismissal or lead to any other substantive change, I do not believe that the failure to consult prior to the date of termination rendered the dismissal unfair. Given the evidence in relation to the operational need to restructure, I am of the view that it is likely that Mr Maswan would have been dismissed in any event, even if timely consultation had occurred.”
[65] However, the circumstances in this matter differ from those in Escada in two key respects. First, Escada was a much smaller business. It employed five employees in Australia, three at a retail store in the Sydney CBD and two at its Head office, also in the Sydney CBD 71. In contrast the Respondent in this matter is a much larger organisation. Secondly, Escada had been experiencing financial difficulties72. This is not the case in this matter.
[66] In UES, another authority cited by the Respondent in its submissions, the Full Bench said:
“[48] UES, however, failed to consult with Mr Harvey as required by the “consultation regarding major workplace change” clause in the modern award that applied to his employment. In the circumstances the failure to so consult was unreasonable. We regard such a failure to consult as also a matter relevant to our consideration as to whether Mr Harvey’s dismissal was harsh, unjust or unreasonable. Further, it is a matter telling for a conclusion that Mr Harvey’s dismissal was harsh, unjust or unreasonable.
Conclusion regarding harsh, unjust or unreasonable
[49] Taking into account the matters referred to above, we are satisfied Mr Harvey’s dismissal by UES was harsh, unjust or unreasonable. A failure to consult does not necessarily mean a dismissal was harsh, unjust or unreasonable. However, in this case we consider the failure to consult was unreasonable and is sufficient to lead us to conclude Mr Harvey’s dismissal was harsh, unjust or unreasonable, notwithstanding the valid reasons for his dismissal and the due weight we have given to those valid reasons.”
[67] In view of the difference in the circumstances in this matter to those in Escada, I prefer the approach adopted by the Full Bench in UES. Accordingly, and having regard to the Applicant’s more than twelve years of service, her age and her numerous unsuccessful attempts to secure employment, I find that the Applicant’s termination was harsh, unjust and unreasonable.
Remedy
[68] As noted at paragraph [15] above, the Applicant sought “reinstatement, payment of lost wages and an order for continuity” or, in the alternative, compensation of $39,902.72.
[69] Section 318 of the Act sets out the object of Part 3-2 of the Act, providing at ss.318(1)(c) that an object of Part 3-2 is “to provide remedies if a dismissal is found to be unfair, with an emphasis on reinstatement.”
[70] In view of the fact the Applicant’s former responsibilities have been subsumed into new or other roles in the Finance and Community Services areas and the lack of redeployment opportunities I do not consider reinstatement appropriate in this case.
[71] Section 390 of the Act deals with when the Commission may order a remedy for unfair dismissal and provides at ss.390(3):
(3) The FWC must not order the payment of compensation to the person unless:
(a) the FWC is satisfied that reinstatement of the person is inappropriate; and
(b) the FWC considers an order for payment of compensation is appropriate in all the circumstances of the case.
[72] The criteria relevant to the deciding of the amount of compensation are set out in s.392(2).
Remuneration that would have been received (s.392(2)(c))
[73] The Respondent submitted that it intended to consult the Applicant during her five week notice period and that it would have preferred the Applicant to work out her notice period. As noted at paragraph [23] above, the Respondent also submitted that, were the Commission to find that it had not complied with consultation obligations under the Agreement, “this was a simple procedural error that, if fully complied with, would only have delayed the redundancy and subsequent termination of the Applicant’s employment by a couple of days”, subsequently adding that any remedy should be limited “to a matter of days.” A further consideration is the Respondent’s advice indicating that a contractor was engaged on 4 August 2013 to assist with the backlog of work at the end of financial year.
[74] I consider that a remedy limited “to a matter of days” as proposed by the Respondent as far too short a period to allow meaningful consultation. Conversely, I consider a consultation period equivalent to the five week notice period as slightly too long. I also consider the two week period determined in UES as somewhat too short in this case in view of the length of service and age of the Applicant. A four week period would in my view have enabled an appropriate period for consultation and a genuine opportunity for both parties to consider possible redeployment opportunities. Further, such a period would have provided scope for a more thorough handover by the Applicant and may have either minimised or completely avoided any gap between the Applicant ceasing work and the abovementioned contractor commencing with the Respondent.
[75] Accordingly, I consider that had the Applicant not been terminated when she was a reasonable expectation was that she would have been likely to receive another four weeks’ remuneration.
[76] Prior to her termination, the Applicant’s gross weekly salary was $1408.14 73. Four weeks’ compensation at this level equates to $5632.56 less applicable tax to which must be added superannuation contributions of 9.25%.
Remuneration earned (s.392(2)(e))
[77] The Applicant has earned no income since her termination, so no deduction on this ground is warranted.
Income reasonably likely to be earned (s.392(2)(f))
[78] Based on the Applicant’s experience to date, it is highly unlikely that she will earn any income during the period between the making of an order for compensation and the actual compensation. Accordingly, no deduction on this basis is warranted.
Other matters (s.392(2)(g))
[79] There are no other matters that I consider relevant to take into account in the determination of an amount of compensation in lieu of reinstatement for the Applicant, apart from those in ss.392(2)(a), (b) and (d), s.392(3) and s.395(5) of the FW Act to which I now turn.
Viability (s.392(2)(a))
[80] There is no evidence that an order for $5632.56 less applicable tax plus 9.25% superannuation payable to the Applicant would affect the viability of the Respondent’s enterprise.
Length of service (s.392(2)(b))
[81] As previously noted, the Applicant had over twelve years service with the Respondent. Such a period of service provides no basis for reducing the proposed amount of compensation.
Mitigation efforts (s.392(2)(d))
[82] As previously noted, the Applicant has unsuccessfully applied for over 200 positions since her termination. Accordingly, I am satisfied that she has made every to mitigate the loss suffered by her because of her dismissal and that as such there is no basis for reducing the proposed amount of compensation.
Misconduct (s.392(3))
[83] Misconduct was not a factor in the Applicant’s termination. As a result, there is no basis to reduce the proposed compensation amount on account of misconduct.
Compensation cap (s.392(5))
[84] The proposed amount of compensation of $5632.56 less applicable tax plus 9.25% superannuation is less than the compensation cap for the Applicant as per s.392(5) of the FW Act.
Conclusion
[85] I am satisfied an order for the payment of compensation of $5632.56 less applicable tax plus 9.25% superannuation by the Respondent to Mrs Barbakh in lieu of reinstatement is appropriate in all the circumstances of the case. It accords a fair go all round to both the Applicant and the Respondent. An order to this effect is attached at PR548683.
DEPUTY PRESIDENT
Appearances:
G Pinchen for the Applicant.
D McLaughlin for the Respondent.
Hearing details:
2014.
Melbourne:
January 31.
1 Exhibit P1 at Attachment AB1, Point 2
2 Form F3 - Employer’s Response to application for Unfair Dismissal at Item 2
3 Ibid
4 Exhibit P1 at Attachment AB5
5 Respondent’s Submissions in Reply to the Application at paragraph 7b
6 Applicant’s Outline of Submissions at paragraph 7
7 Ibid at paragraph 62
8 Outline of Submissions - Response to Jurisdictional Objections at paragraph 4
9 Ibid at paragraph 5
10 Applicant’s Outline of Submissions at paragraphs 75-76
11 Exhibit P6
12 Exhibit P1 at paragraph 22
13 Ibid at paragraphs 23 and 27
14 Ibid at paragraph 31
15 Ibid at paragraphs 50-53
16 Ibid at paragraph 60
17 Ibid at paragraphs 62-64
18 Exhibit P2
19 Transcript at PN103
20 Ibid at PN108-109
21 Ibid at PN139
22 Ibid at PN389
23 Ibid at PN192-220
24 Ibid at PN304-340
25 Ibid at PN250-274
26 Respondent’s Submissions in Support of its Jurisdictional Objection to the Application at paragraphs 22-24
27 Respondent’s Submissions in Reply to the Application at paragraphs 17-18
28 [2011] FWA 4239
29 (2012) 215 IR 263
30 Respondent’s Submissions in Reply to the Application at paragraph 21
31 Ibid at paragraphs 24-28
32 Exhibit MC3
33 Exhibit MC5
34 Exhibit MC6 at paragraph 6
35 Exhibit MC4 at paragraph 7
36 Ibid
37 Ibid at paragraph 10
38 Ibid at paragraph 12
39 Ibid at paragraph 14
40 Ibid at paragraph 15
41 Transcript at PN909-910
42 Ibid, PN992
43 Ibid, PN1038-1043
44 Ibid, PN614
45 Ibid, PN619-623
46 Ibid, PN633
47 Ibid, PN714 and PN721
48 Ibid, PN835-844
49 Ibid, PN851
50 Ibid, PN869
51 Ibid, PN878
52 Ibid, PN937
53 Ibid, PN952-965
54 Ibid, PN970-973
55 Ibid, PN992-1007
56 Ibid, PN1018-1027 and PN1057
57 Ibid, PN1064
58 Ibid, PN1113-1117
59 Ibid, PN1115-1129
60 Ibid, PN1201
61 Ibid, PN1177
62 Ibid, PN1182
63 Ibid, PN1183-1185
64 Ibid, PN1227-1235
65 Exhibit P1 at Attachment AB5
66 Transcript at PN1275
67 Ibid
68 [2012] FWAA 4091
69 [2014] FWCFB 714
70 [2011] FWA 4239 at paragraph [42]
71 Ibid at paragraph [3]
72 Ibid at paragraph [5]
73 Exhibit P1 at paragraph 9
Printed by authority of the Commonwealth Government Printer
<Price code C, PR548682>
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