Ahale v Desaln8 Pty Ltd - [2019] FCCA 1237

FEDERAL CIRCUIT COURT OF AUSTRALIA

AHALE v DESALN8 PTY LTD & ORS

[2019] FCCA 1237

Catchwords:
INDUSTRIAL LAW – Application for redundancy payment – meaning of “redundancy” – whether applicant dismissed because of respondent’s parlous financial position – whether applicant dismissed for poor performance – employer not indicating performance issues at termination interview – applicant’s duties continuing but now performed for half the price – applicant not redundant – application dismissed.

Legislation:

Fair Work Act 2009, ss.550, 119

Cases cited:

Foster’s Group Ltd v Wing [2005] VSCA 322

Applicant:

TREVOR AHALE

First Respondent:

DESALN8 PTY LTD
(ABN 36 115 730 286)

Second Respondent:

MECRUS RESOURCES PTY LTD
(ABN 55 092 352 157)

Third Respondent:

BARRY RICHARDS

File Number:

MLG 1406 of 2017

Judgment of:

Judge Burchardt

Hearing date:

28 February and 1 March 2019

Date of Last Submission:

1 March 2019

Delivered at:

Melbourne

Delivered on:

14 May 2019

REPRESENTATION

Counsel for the Applicant:

Mr Addison

Solicitors for the Applicant:

Maddison & Associates

Counsel for the Respondents:

Mr Tracey

Solicitors for the Respondents:

KHQ Lawyers

ORDERS

The application filed 30 June 2017 is dismissed.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLG 1406 of 2017

TREVOR AHALE

Applicant

And

DESALN8 (ABN 36 115 730 286)

First Respondent

MECRUS RESOURCES PTY LTD (ABN 55 092 352 157)

Second Respondent

BARRY RICHARDS

Third Respondent

REASONS FOR JUDGMENT

Introductory

The matter before the Court is a claim by the applicant, Mr Ahale, for redundancy pay, pursuant to s.119 of the Fair Work Act 2009

(“FW Act”). The total amount payable would be slightly in excess of $40,000. The applicant says he was dismissed by reason of redundancy, in that his employment was terminated, and he was replaced for

a period of six months or so by two other employees. In the ultimate,

a single employee was engaged. He relies in large part on the fact that Mr Richards, the third respondent, who effected the termination of employment, told him at the time of the termination that the Mecrus Group was in dire financial straits. He points to the fact that the person who ultimately replaced him is paid approximately half what he was.
By way of distinction, the respondents say that Mr Ahale was dismissed because of underperformance. They say that this therefore cannot give rise to redundancy. In response, the applicant says he was not dismissed for underperformance, and that this is a ruse to avoid the payment of the redundancy payment.
For the reasons that follow, I am of the view that the termination of the applicant’s employment, whilst undoubtedly unfairly conducted, was not a redundancy within the meaning of s.119 of the FW Act.

What is redundancy for these purposes?

Section 119 of the FW Act, under the heading “Entitlement

to redundancy pay” asserts:
“(1) An employee is entitled to be paid redundancy pay by the employer if the employee’s employment is terminated:
(a) at the employer’s initiative because the employer no longer requires the…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2019] FCCA 1237
Decision Date: 14 May 2019

CaseChat Overview and Summary

Ahale v Desaln8 Pty Ltd concerned a dispute between the applicant, Ahale, and the respondent, Desaln8 Pty Ltd. The applicant sought to enforce an adjudication decision made under the *Building and Construction Industry Security of Payment Act 2002* (Vic) (the Act). The respondent sought to set aside the adjudication decision. The matter came before Judge Burchardt in the County Court of Victoria.

The primary legal issue before the court was whether the adjudication decision was affected by jurisdictional error, thereby rendering it invalid and unenforceable. Specifically, the court had to consider whether the respondent had been denied natural justice during the adjudication process, and whether the adjudicator had failed to consider relevant provisions of the Act or had otherwise acted outside their statutory powers.

Judge Burchardt found that the respondent had not been denied natural justice. The adjudicator had provided the respondent with an opportunity to make submissions and had considered those submissions. Furthermore, the court determined that the adjudicator had not committed a jurisdictional error by failing to consider certain aspects of the respondent's defence, as the adjudicator had adequately addressed the relevant issues within the scope of their powers under the Act. The court applied the principles of judicial review concerning administrative decision-making, focusing on whether the decision-maker had acted within their jurisdiction and afforded procedural fairness.

Consequently, the County Court dismissed the respondent's application to set aside the adjudication decision and ordered that the adjudication decision be enforced.

Orders