Anne Reid v Dame Pattie Menzies Centre Incorporated

[2014] FWC 9369

[2014] FWC 9369

FAIR WORK COMMISSION

REASONS FOR DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Anne Reid
v
Dame Pattie Menzies Centre Incorporated
(U2014/11841)

DEPUTY PRESIDENT GOSTENCNIK MELBOURNE, 22 DECEMBER 2014

Application for relief from unfair dismissal; whether a genuine redundancy; application dismissed.

Introduction

[1] Ms Anne Reid (Applicant) was, until the termination of her employment with effect on 31 July 2014, employed by the Dame Pattie Menzies Centre Incorporated (Respondent) as its administration manager. She had commenced employment with the Respondent on 28 May 2007.

[2] The Respondent’s reason for its decision to dismiss the Applicant from her employment was that of redundancy brought about by an organisational restructure that it had undertaken. The Applicant applied to the Fair Work Commission (Commission) for an unfair dismissal remedy pursuant to s. 394 of the Fair Work Act 2009 (Act) on 19 August 2014. On 27 August 2014 the Respondent gave notice that it objected to the application on the ground that the dismissal of the Applicant was a case of genuine redundancy. Section 396 of the Act requires the Commission to decide certain matters relating to an unfair dismissal remedy application before considering the merits of the application including, relevantly, whether a dismissal was a case of genuine redundancy.

[3] I heard the Respondent’s jurisdictional objection on 18 December 2014 at Shepparton. At the conclusion of the hearing I decided, ex tempore, to dismiss the Applicant’s application on the basis that I was satisfied that her dismissal from employment by the Respondent was a case of genuine redundancy within the meaning of s. 389 of the Act. These are my reasons for so deciding.

Factual context and background

[4] The Respondent is a not for profit community organisation serving the people of Alexandra and surrounding districts. The Respondent provides various forms of support and services to adults with a disability and their families. In or around 12 June 2014 the Respondent entered into a management services agreement with another organisation known as Connect GV. 1

[5] Connect GV is also a not-for-profit organisation providing various services to people with disabilities and their families in the Goulburn region.

[6] Entry into the management services agreement was a prelude to a formal merger between the two organisations initially scheduled to be complete by 31 December 2014 but now more likely to be completed by 30 June 2015. The management services agreement commenced operating on 1 July 2014 2. Pursuant to the management services agreement Mr Anthony Giovanetti, the Chief Executive Officer of Connect GV, was authorised by the Respondent’s committee of management to manage the operations of the Respondent3.

[7] The principal purpose of the management services agreement was to enable Connect GV to provide management services to the Respondent in the lead up to a merger, in return for which services, the Respondent would pay to Connect GV a fee of $12,000 per month inclusive of certain expenses 4.

[8] The Applicant challenged the validity of the management services agreement but beyond bare assertions produced no evidence about its validity. Mr Giovanetti gave sworn evidence that the agreement was validly entered into. Acting under the authority of that agreement he assumed the management of the Respondent from 1 July 2014 5. Moreover, it is apparent that both the Respondent and Connect GV have been acting consistently with the terms of the agreement. No member of either the committee of management of the Respondent or of the board of Connect GV was called to give evidence which would cast doubt on the validity of the agreement. Mr Peter Elms-Smith gave sworn evidence that he was the President of the committee of management of the Respondent, that he had occupied the President’s position since June 2014 and that he has been a member of the committee of management of the Respondent for 12 years.6 Mr Elms-Smith gave evidence that he was authorised by the board to sign the management services agreement and that he did so on 18 June 2014.7 I accept this evidence.

[9] There is no evidence before me which would suggest anything other than that Mr Giovanetti is properly seized of the day-to-day management of the Respondent and has since 1 July 2014 (other than for a short period whilst he was on leave) acted in that capacity in relation to management decisions affecting the Respondent.

[10] On assuming responsibility for the management of the Respondent, Mr Giovanetti commenced a review of the organisational structure of the Respondent. 8 Mr Giovanetti gave evidence, and I accept that evidence, that in reviewing the Respondent’s organisational restructure and having regard to the Respondent’s financial position, he concluded that there needed to be a rationalisation of the number of managerial staff and functions they performed, that some of the functions performed could be undertaken by Connect GV through technological changes and streamlining and upgrading of accountancy, computer and business systems.9

[11] As a consequence of the review an organisational chart reflecting the restructure of the Respondent was developed. 10 During the course of the review it became apparent to Mr Giovanetti that there was a need for a reduction in staffing and consequently there would be some redundancies.11 Mr Giovanetti gave evidence that shortly thereafter he commenced a process of consultation with staff of the Respondent that would be affected by the outcome of the review and that he also consulted the relevant union being the Health Services Union of Australia.12

[12] In order to assist the consultation, Mr Giovanetti developed a change impact statement. 13

[13] The change impact statement was given to the Applicant during a meeting on 14 July 2014 between the Applicant and Ms Leah Ross who was at that time acting as Chief Executive of the Respondent in Mr Giovanetti’s absence on leave 14. The Applicant accepted that she was given a copy of the change impact statement and that she subsequently read and understood that document.

[14] The change impact statement sets out the decision to implement the organisational restructure of the Respondent, the effect of the change on staff, the identity by position of staff affected, the manner in which those staff will be affected, the opportunities for redeployment through applications for appointment to newly created positions and other measures that might mitigate the effect of the changes on staff, and the timeframe for the proposed changes.

[15] Mr Giovanetti’s evidence was the duties constituting the job that had been performed by the Applicant was absorbed partially into the role of receptionist and partially into existing roles performed by others employed at Connect GV. To illustrate the point the Respondent produced the Applicant’s position description marked with the duties that had been absorbed by roles carried out by employees of Connect GV. 15 It is apparent from that document, that the substantial preponderance of duties previously carried out by the Applicant in her job and been absorbed by staff of Connect GV and that the remaining duties form part of the role of the new receptionist position. The accuracy of this document was not seriously challenged by the Applicant.

[16] It is common ground that a number of positions were made redundant as a consequence of the restructure and that two new positions were created namely that of receptionist and supervisor day services. It is also common ground that the Applicant did not apply for the receptionist position and did not have the requisite skills to be appointed to the supervisor day services position. As more than one person was affected by the redundancies it was necessary to attempt to fill the newly created positions by interview and selection rather than direct redeployment. It is also common ground that the Applicant did not, after receiving the change impact statement, raise any issues about the restructure with the Respondent, apart from asking Ms Ross for written confirmation about the impending redundancy.

[17] The Applicant maintained that she did not apply for the position of receptionist because she did not believe she would be genuinely considered because of past events (about which there was some evidence but findings about those matters are unnecessary given the scope of matters that I must decide). The proposition that the Applicant would not be genuinely considered for the receptionist position was never put by her to any of the Respondent’s witnesses despite my having taken the unusual step of recalling each of the Respondent’s witnesses after they had concluded their evidence so that that proposition might be put. Although there was some evidence about those matters given by the Applicant and in her materials it is unnecessary for me to make findings about these matters, because ultimately they amount to no more than the Applicant’s belief. As a matter of fact there was a position available for which the Applicant was qualified, but the Applicant chose not to apply for appointment.

[18] The uncontested evidence of the Respondent was that the Respondent and Connect GV were not associated entities and that the Respondent did not have any other associated entity. The uncontested evidence of the Respondent was also that apart from the two positions identified above there were no other positions into which the Applicant could have been redeployed. The Applicant did not assert that there was any other position into which she could have been redeployed.

[19] By letter dated 24 July 2014 the Applicant was advised that her employment would end on 31 July 2014 by reason of redundancy and she was provided with a document setting out the payments that would be made to her on the termination of her employment. 16 The Applicant’s employment ended with effect on 31 July 2014.

[20] The Applicant gave evidence and produced documents about the circumstances of her dismissal and about the events that had transpired prior to her dismissal. No purpose is served in rehearsing these matters as they are not relevant to the question of whether the Applicant’s dismissal was a case of genuine redundancy. Much of the material relied upon by the Applicant would be relevant to the question of merit. In essence, the Applicant’s evidence sought to attach motive to the Respondent for its decision to select her for dismissal on redundancy grounds. The question whether a dismissal was a case of genuine redundancy within the meaning of the Act is not concerned with the process for selecting an individual for redundancy or any motive that might attach to that selection. There are remedies under the Act which are concerned with selecting a person for dismissal on redundancy grounds that are motivated by prohibited reasons 17, but an application for an unfair dismissal remedy is not one of them.

[21] The Applicant also relied on the evidence contained in statements of Graham Felstead, Linda Robinson, Jeanette Lovett and Robert Chaffe.  18 That evidence dealt with the duties performed by the Applicant in her position (which was not in dispute), that she was a diligent employee (which was not in dispute), that representations were made about the security of Ms Lovett’s employment following the restructure (which was not accepted by the Respondent but which was irrelevant to any question that I need to determine) or dealt with past events which was said to have infected the motive of the Respondent in selecting the Applicant for redundancy (which for the reasons given earlier was also irrelevant). Ultimately I have not found the evidence relied upon by the Applicant unhelpful in determining the jurisdictional object. It was not responsive to any question that I need to determine nor did it undermine the evidence relied upon by the Respondent, which was responsive to the issues relevant to questions I am required to determine.

Relevant statutory provisions and consideration

[22] Sections 385 sets out when a person has been unfairly dismissed and provides as follows: 389 provide as follows:

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.

[23] It is apparent from the above that if a person’s dismissal was a case of genuine redundancy then that person has not been unfairly dismissed within the meaning of the Act.

[24] Section 389 sets out the meaning of genuine redundancy and provide as follows:

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.

[25] I now turn to consider each of the elements of the definition of genuine redundancy.

Was the Applicant’s job no longer required to be performed?

[26] The Applicant’s dismissal will have been a case of genuine redundancy, inter alia, if the Respondent no longer required the Applicant’s job to be performed by anyone because of changes in the operational requirements of the Respondent’s enterprise.

[27] Although there was some dispute about the Applicant’s title, there was no dispute about the duties that constitute the job performed by the Applicant for the Respondent prior to her dismissal. For present purposes it is sufficient to describe the Applicant’s job as that of administration manager. The Applicant submitted that some of her duties were still being performed and the duties that she performed in her job were still necessary to be performed in the Respondent’s enterprise. This submission with respect misunderstands the difference between a job on the one hand and duties forming part of that job on the other.

[28] The term “job” describes a collection of the duties, functions and responsibilities that are entrusted to a person within an organisation. The collection of duties, functions and responsibilities together constitute the job that is performed. It is always open to an employer to rearrange an organisational structure by breaking up a collection of duties, functions and responsibilities that attached to a particular job and to redistribute them amongst other positions or to create a new position. 19 Therefore if after such a reorganisation there are no longer any duties, functions and responsibilities assigned to a job, that job is no longer required by the employer to be performed by anyone.

[29] On the basis of the evidence discussed earlier at [10] – [15] I am satisfied that the Respondent undertook an organisational review out of which it decided to redistribute a number of duties previously constituting the Applicant’s job to persons employed at Connect GV and to the new position of receptionists. It also decided that as a consequence of implementing more efficient accounting, computer and business systems, other parts of the duties constituting the Applicant’s job did not need to be performed as part of that job. I am satisfied that the Respondent identified the Applicant’s job as no longer being required to be performed by anybody and that this was as a consequence of changes in the operational requirements of the employer’s enterprise, brought about by the organisational review undertaken by the Respondent.

Did the Respondent comply with any consultation obligations?

[30] Turning next to consider whether the Respondent was obliged by a modern award or enterprise agreement to consult with the Applicant about the redundancy prior to the dismissal, and if so whether the Respondent complied with such obligation.

[31] It is common ground and I accept that the Social, Community, Home Care and Disability Services Industry Award 2010 (Award) covered the Respondent and the Applicant, and applied to them at the relevant time. Clause 8 of the award sets out the obligations to consult relevantly in the following terms:

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.

[32] I have earlier set out at [11] – [16] the evidence of the Respondent, which I accept, about the steps that it took to consult the Applicant about its decision and about the redundancy. On the basis of that evidence it seems to me clear that the Respondent has established the Respondent notified the Applicant of the proposed changes, that it provided information to the Applicant and discussed with the Applicant the introduction of the changes, the effect the changes will likely have on the Applicant and the measures to avert or mitigate give adverse effects of the changes on the Applicant. As the Applicant did not raise any matters for consideration arising out of that consultation, the question whether the Respondent gave proper consideration to such matters does not arise. It is also clear from the evidence that the discussions commenced as early as practicable after the Respondent made its decision. The relevant information concerning the nature of the changes and the expected effects of the changes on the Applicant were communicated to the Applicant in writing as required by clause 8 of the Award through the change impact statement.

[33] I am therefore satisfied that the Respondent complied with its obligations in the Award to consult the Applicant about the redundancy.

Was redeployment reasonable in all the circumstances?

[34] For the reasons given in [17] – [18] I am satisfied that the only two positions into which the Applicant could have been redeployed namely that of receptionist and supervisor day services. I am also satisfied that the Applicant was not qualified to perform the role of supervisor day services, and that although qualified to perform the job of receptionist, the Applicant did not apply for that position. The issue of redeployment to an associated entity of the Respondent does not arise.

[35] Therefore on the basis of the evidence before me I am satisfied that it was not reasonable in all of the circumstances to redeploy the Applicant to another position within the Respondent’s enterprise.

Conclusion

[36] For the reasons given, I am satisfied that the dismissal of the Applicant by the Respondent which took effect on 31 July 2014 was a case of genuine redundancy within the meaning of s. 389 of the Act. It follows that the Applicant was not unfairly dismissed within the meaning of s. 385 of the Act. The application for an unfair dismissal remedy is dismissed. An order to that effect has separately been issued in PR559478.

DEPUTY PRESIDENT

Appearances:

A. Reid on her own behalf

A. Forsyth (Counsel), E. Aitken for Dame Pattie Menzies Centre Incorporated

Hearing details:

Shepparton.

2014.

18 December

 1   See exhibit F3 attachment AGB – 1

 2   Ibid clause 6

 3   Ibid clause 3

 4   Ibid clauses 1 and 5

 5   Exhibit F3 at [2] and [9]

 6   Exhibit F1 at [1] – [2]

 7   Ibid at [10] and attachment PES – 1

 8   Exhibit F3at [10]

 9   Ibid at [11] – [13]

 10   Exhibit F 4 attachment ABG – A 1

 11   Exhibit F3 at [13]

 12   Ibid at [14]

 13   Ibid at [15] and attachment AGB – 2

 14   Exhibit F5 at [8] and exhibit F6 at [5]

 15   Exhibit F7

 16   Exhibit F6 at [9] – [10] and attachments LMR – A 1 and L MR – A 2

 17   See general protections provisions in Part 3 – 1 of the Act

 18 See annexures to exhibit R1 and exhibits R3 and R 4

 19   See Jones v Department of Energy and Minerals (1995) 60 IR 304 at 308

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