Alexandra Reid v Asciano Executive Services Pty Ltd T/A Patrick

[2016] FWC 3615

[2016] FWC 3615

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Alexandra Reid
v
Asciano Executive Services Pty Ltd T/A Patrick
(U2016/5605)

SENIOR DEPUTY PRESIDENT O’CALLAGHAN ADELAIDE, 8 JUNE 2016

Application for relief from unfair dismissal – genuine redundancy.

[1] On 22 March 2016 Ms Reid lodged an unfair dismissal application pursuant to s.394 of the Fair Work Act 2009 (the FW Act) in relation to the termination of her employment with Asciano T/A Patrick BWL Pty Ltd. I have amended the employer name pursuant to s.587 of the FW Act to Asciano Executive Services Pty Ltd T/A Patrick (Patrick). Ms Reid’s application was lodged outside of the statutory time limit but that time limit was extended by Commissioner Ryan following a hearing on 15 April 2016.

[2] This decision deals specifically with the Patrick objection to the application, made on the basis that the termination of Ms Reid’s employment was a case of genuine redundancy. That objection was the subject of a hearing, by telephone, on 7 June 2016. In that hearing Ms Reid represented herself while Patrick was represented by its General Manager Human Resources, Ms Ferrier. A sound file record of that hearing was kept.

[3] The FW Act makes the significance of a genuine redundancy clear in the following terms. Section 385 states:

“385 What is an unfair dismissal

A person has been unfairly dismissed if the 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.”

[4] Section 389 states:

“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.”

[5] Section 396 requires that I reach a conclusion on an issue of this nature before considering the merits of the application.

[6] Prior to the termination of her employment, Ms Reid was an Administrative Assistant at the Patrick’s BWL Henderson site. She was responsible for a range of general administrative tasks, including tasks associated with the logistics and warehousing functions undertaken by Patrick. The major client of the BWL Henderson site accounted for some 80% of the work undertaken. Patrick became aware that it had lost that contract in January 2016 but the timing of the work loss was immediately clear. Ms Reid’s employment was covered by the Clerks Private Sector Award 2010.

[7] Patrick management advised the BWL Henderson site employees, of the contract loss, commencing on 29 January 2016. Ms Reid was absent that day but she was advised, in a meeting on 1 February 2016, with the Patrick Operations Manager, Mr Baker and Human Resources Advisor, Ms Verity, that the loss of that contract was likely to mean that her role would become redundant, but that the full extent of the contract loss was not yet clear. The exact nature of the information given to Ms Reid in that meeting is disputed.

[8] On 2 February 2016 Ms Verity provided written information to Ms Reid. 1 This letter confirmed that her work tasks would no longer be required from 29 February 2016 because of the loss of that contract and because of a broader national restructure but that Patrick remained committed to exploring redeployment opportunities for her before that date. This letter invited Ms Reid to apply to be made redundant before 29 February 2016 should she wish to do so.

[9] After she received this letter, Ms Reid telephoned Ms Verity to obtain clarification about her employment options. The nature of this discussion is disputed.

[10] On 4 February 2016 Ms Reid confirmed, by email 2 that she would accept the redundancy offer and finish work on 5 February 2016. There is no argument that she was paid her redundancy payments.

[11] Ms Reid’s position is that her role covered functions not limited to the contract loss and that her position was still required. Ms Reid asserts that the consultation process followed by Patrick’s did not meet the requirements set out in the Award in that she was not properly informed of the general meeting of employees on 29 January 2016 when she was on leave and was the only employee to receive a letter of the type she received on 3 February 2016. Furthermore, Ms Reid argues that she was not able to participate and nominate a preference for an alternative role as she was made redundant on 5 February 2016. She asserts that the only redeployment option offered to her was a car parking attendant position which was inconsistent with her skills and experience. Ms Reid argues that she should have been offered an administration role that was being undertaken by a labour hire employee and that, more generally, other employees should have been made redundant other than her. Implicit in her submission is the proposition that Patrick's failed to make reasonable enquiries to identify alternative positions.

[12] I have taken all of Ms Reid’s evidence into account, but have briefly summarised this evidence in the following terms. Ms Reid’s evidence confirmed her employment function and the reasons why she did not understand that the contract loss would result in redundancies. On 28 January 2016 Ms Reid was advised that there would be individual meetings held with her and two other employees on 1 February 2016. Ms Reid recounted her recollection of that meeting. She agreed that she was made aware that she could be made redundant but indicated that she wanted to stay on with Patrick and would consider other roles, including, if relocation costs were met, interstate roles. Her evidence was that Ms Verity advised that Patrick's would not cover relocation costs. Ms Reid agrees that she asked for advice about her redundancy payments to be provided to her “so that I have all options available to me”.

[13] Notwithstanding this, Ms Reid’s evidence was that she was shocked to receive the 2 February 2016 advice confirming her impending redundancy. She telephoned Ms Verity and understood from that discussion that she had to ask to be made redundant on 5 February 2016 in order to receive the payments specified in that letter and, further, that if she worked until 29 February she would not receive a redundancy payment. Her evidence was that she accepted the redundancy on 4 February 2016 on this basis. Ms Reid’s initial position was that she understood that the redundancy payment would not be made if she elected to work until 29 February 2016. However, she has accepted that she may have confused the redundancy payment issue with the provision of four weeks notice or payment in lieu of that notice. That payment in lieu would reduce over the four week period.

[14] Ms Reid's evidence went to discussions she had with Mr Baker about termination arrangements, her discussions with other employees and her understanding of a review of the Patrick's administrative structure.

[15] Ms Reid agreed that the contract work which was lost by Patrick represented a major component of her work.

[16] The Patrick position is that the termination of Ms Reid’s employment was a direct consequence of the major contract loss and that the job that she was undertaking was then not required. Patrick's assert that it consulted with Ms Reid, that it confirmed her redundancy in correspondence to her and that it undertook an initial investigation into redeployment opportunities, and was continuing to explore those opportunities until she requested to be made redundant on 5 February 2016.

[17] Ms Verity’s evidence went to her understanding of the effect of the major contract loss and her involvement in consultations with affected staff members. She advised that, commencing on 29 January 2016 she commenced enquiries within Patrick's about redeployment opportunities for staff affected by the contract loss.

[18] Ms Verity was involved with Mr Baker in the meeting with Ms Reid on 1 February 2016. Her evidence went to the content of those discussions and confirmed that Mr Baker advised Ms Reid that her position was likely to be made redundant. Ms Verity explained the redundancy process and understood from Ms Reid that she was only interested in redeployment to an administrative role in the local area.

[19] On 2 February 2016 Ms Verity was made aware that the impact of the contract loss would mean that Ms Reid's position would not be required. Ms Verity wrote to Ms Reid that day. This letter stated:

“As discussed with you on Monday 1st February, 2016, Patrick has recently reviewed its operational administration requirements, in particular Patrick has reviewed the position of Administration Assistant that you currently perform at BWL Henderson in a full time capacity.

As a result of this review, it has been determined that the tasks currently allocated to your position will no longer be required due to loss of aspects of the Tronox contract and the restructure of the broader Patrick business nationally.” 3

[20] Ms Verity's evidence went to the subsequent discussion she had with Ms Reid after sending her that letter and to her receipt, from Ms Reid on 4 February 2016, of the request to be made redundant, in the following terms:

Hi Sas,
I have decided that I will accept the severance and redundancy offer and as stated in the letter my last day will be tomorrow 05/02/16.
Regards,
Alexandra Reid 4

[21] Ms Verity's evidence went to confirm that, after this she did not further pursue redeployment options for Ms Reid. She confirmed that Ms Reid’s position was not replaced but that residual duties were allocated to other existing personnel and that the labour hire employee now undertakes a quite different function at a different site. Ms Verity confirmed that, effective 2 May 2016 seven more Patrick's personnel were made redundant as a consequence of the contract loss and that consultations about further redundancies were continuing.

Findings

[22] Before considering the extent to which the termination of Ms Reid's employment met the definition of a genuine redundancy, I have set out my conclusions about the key disputed facts.

[23] Firstly, I prefer the evidence of Ms Verity about the nature of the discussions she had with Ms Reid on 1, 2 and then 4 February 2016. That evidence is consistent with the correspondence to and from Ms Reid.

[24] I have concluded that Ms Reid was advised on 1 February 2016 that her position was likely to be made redundant on 29 February 2016. Further, that the option of taking an earlier redundancy payment was put to her and that she showed some interest in that. This is consistent with Ms Reid's own account of that meeting, with the letter of 2 February and Ms Verity's account. I think Ms Reid simply misunderstood that she would not be paid any redundancy payment if she stayed on until 29 February 2016 as that is clearly not consistent with the letter of 2 February 2016 which relevantly states:

“Consequences if there is no reasonable redeployment option available

If no reasonable redeployment opportunity is attained, your position will become redundant on 29^th February, 2016. On or shortly after this date and you will be provided with:

a) notice (or pay in lieu of notice) in accordance with your employment contract or policy;

b) a redundancy severance payment in accordance with any the Asciano Redundancy Policy (a copy of which is attached);

c) payment of any accrued but untaken statutory entitlements;

d) A tailored Outplacement Assistance Program with Right Management (an information copy is attached).” 5

[25] I have also concluded that Ms Reid was advised that redeployment options were being explored but that, as of 2 February 2016, the only vacancy was a car parking role which Ms Reid considerated was not a suitable possibility.

[26] I have concluded that Ms Reid indicated that she only sought a position in Fremantle or Perth. That is consistent with the evidence of Ms Verity and with the handwritten notes of the meeting of 1 February 2016.

[27] Again, before considering s.389, there is a further issue that warrants comment. In this matter Patrick's have not challenged the extent to which Ms Reid was dismissed. As s.385 confirms, dismissal is an essential prerequisite for any finding of unfair dismissal. Section 386 defines a dismissal in the following relevant terms:

“386 Meaning of dismissed

(1) A person has been dismissed if:

(a) the person’s employment with his or her employer has been terminated on the employer’s initiative; or

(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.”

[28] The letter of 1 February 2016 advised Ms Reid that her position would be made redundant on 29 February 2016. That same letter confirmed that she could seek to be made redundant before that date. It confirmed the on-going efforts to obtain reasonable redeployment options. It was Ms Reid who then responded to that letter by accepting the earlier redundancy offer and specifying that she sought to leave on 5 February 2016. In this context it may be arguable that Ms Reid was not dismissed on 5 February 2016 consistent with s.386 as the letter of 2 February 2016 left open the possibility of redeployment. Ms Reid's election to be made redundant on 5 February removed the capacity for the identification of reasonable redeployment options which may have avoided the termination of her employment.

[29] This issue has not been argued to me and would necessitate detailed consideration if the pertinent facts. As a consequence, I have approached my consideration of Ms Reid's application from the position that there is no dispute that she has been dismissed at the initiative of Patrick's and the only jurisdictional issue is whether that dismissal met the definition of a genuine redundancy in s.389 of the FW Act.

[30] I have accepted that, as a consequence of the loss of its major contract at the BWL Henderson facility, Patrick's no longer required Ms Reid's job to be done by anyone as of the specified date of 29 February 2016. The evidence of Ms Verity confirms that the contract loss was the factor that led to the redundancy advice. That evidence also confirms that Ms Reid was not replaced and that the remaining elements of her job were redistributed to other existing employees. Such an approach remains consistent with the requirements of s.389(1)(a). As a Full Bench stated in Ulan Coal Mines Ltd v Howarth: 6

“[17] It is noted that the reference in the statutory expression is to a person’s “job” no longer being required to be performed. As Ryan J observed in Jones v Department of Energy and Minerals (1995) 60 IR 304 a job involves “a collection of functions, duties and responsibilities entrusted, as part of the scheme of the employees’ organisation, to a particular employee” (at p. 308). His Honour in that case considered a set of circumstances where an employer might rearrange the organisational structure by breaking up the collection of functions, duties and responsibilities attached to a single position and distributing them among the holders of other positions, including newly-created positions. In these circumstances, it was said that:

“What is critical for the purpose of identifying a redundancy is whether the holder of the former position has, after the re-organisation, any duties left to discharge. If there is no longer any function or duty to be performed by that person, his or her position becomes redundant…” (at p.308)

This does not mean that if any aspect of the employee’s duties is still to be performed by somebody, he or she cannot be redundant (see Dibb v Commissioner of Taxation (2004) FCR 388 at 404-405). The examples given in the Explanatory Memorandum illustrate circumstances where tasks and duties of a particular employee continue to be performed by other employees but nevertheless the “job” of that employee no longer exists.”

[31] The evidence before me confirms that the requirements of s.389(1)(a) have been met in this instance. As the Full Bench in Harvey v UES Int’l 7observed, the considerations in s.389 do not extend to the redundancy selection process. Consequently, while it may have been open to Patrick to select someone other than Mrs Reid for redundancy, this does not form a relevant factor.

[32] In terms of s.389(1)(b), there is no dispute that Ms Reid was covered by the Clerks Private Sector Award 2010. Clause 8.1 of that Award specifies the consultation requirements regarding major workplace change in the following terms:

“8. Consultation

8.1 Consultation regarding major workplace change

(a) Employer to notify

(i) Where an employer has made a definite decision to introduce major changes in production, program, organisation, structure or technology that are likely to have significant effects on employees, the employer must notify the employees who may be affected by the proposed changes and their representatives, if any.

(ii) Significant effects include termination of employment; major changes in the composition, operation or size of the employer’s workforce or in the skills required; the elimination or diminution of job opportunities, promotion opportunities or job tenure; the alteration of hours of work; the need for retraining or transfer of employees to other work or locations; and the restructuring of jobs. Provided that where this award makes provision for alteration of any of these matters an alteration is deemed not to have significant effect.

(b) Employer to discuss change

(i) The employer must discuss with the employees affected and their representatives, if any, the introduction of the changes referred to in clause 8.1(a), the effects the changes are likely to have on employees and measures to avert or mitigate the adverse effects of such changes on employees and must give prompt consideration to matters raised by the employees and/or their representatives in relation to the changes.

(ii) The discussions must commence as early as practicable after a definite decision has been made by the employer to make the changes referred to in clause 8.1(a).

(iii) For the purposes of such discussion, the employer must provide in writing to the employees concerned and their representatives, if any, all relevant information about the changes including the nature of the changes proposed, the expected effects of the changes on employees and any other matters likely to affect employees provided that no employer is required to disclose confidential information the disclosure of which would be contrary to the employer’s interests.”

[33] The contract loss and its consequent effects on Ms Reid were major changes for this purpose. Ms Reid was give advance notice of the discussion on 1 February 2016 and I have concluded that she was told of the likely effect of that contract loss for her position shortly after Patrick's became aware of it and even before the full effects could be ascertained. On the same day that Patrick's became aware of more detail regarding that contract loss, Ms Verity provided Ms Reid with the written advice of 2 February 2016. This advice met the requirements of Clause 8.1 and hence s.389(1)(b).

[34] The correspondence of 2 February 2016 and the discussions with Ms Reid confirmed that Patrick's was exploring reasonable redeployment options. I accept that the only option available as at 1 February 2016 may not have been regarded as reasonable from Ms Reid’s perspective but, given that it was Ms Reid who requested that her separation date be 5 February, I am satisfied that, by that date, Patrick's had taken appropriate steps to explore reasonable redeployment options. Ms Verity's evidence about the steps she initiated on 2 February 2016 8 and on 3 February 20169 confirm that Patrick's was in the process of establishing whether or not redeployment would have been reasonable when Ms Reid determined that she wished to finish work on 5 February 2016. Accordingly, the requirements of s.389(2) have been met in this instance.

Conclusion

[35] The termination of Ms Reid's employment was consistent with the definition of a genuine redundancy in s.389. Accordingly, the termination of her employment cannot be regarded as unfair. Ms Reid's application must therefore be dismissed. An Order (PR581167) to this effect will be issued.

Appearances (by telephone):

A Reid on her own behalf.

E Ferrier for the Respondent.

Hearing (Conference) details:

2016.

Adelaide:

June 7.

 1   Exhibit R2, Attachment B

 2   Exhibit R2, Attachment D

 3   Exhibit R2, Attachment B, paras 1 and 2

 4   Exhibit R2, Attachment D, email chain dated 3 and 4 February 2016

 5   Exhibit R2, Attachment B, pg 1, last para

 6   [2010] FWAFB 3488

 7 (2012) 215 IR 263 pn 26

 8   Exhibit R2, para 26

 9   Exhibit R2, para 29

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