Australian Commercial Catering Pty Ltd v Mrs Marcelia Powell

[2014] FWC 2432

[2014] FWC 2432 [Note: Appeals pursuant to s.604 (C2014/662) and C2016/3067 were lodged against this decision and the order arising from this decision - refer to decisions dated 20 October 2014 [[2014] FWC 7412], Full Bench decision dated 6 March 2015 [[2015] FWCFB 87] and 12 August 2016 [[2016] FWCFB 5467] respectively for result of appeals.]

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.120 - Application to vary redundancy pay for other employment or incapacity to pay

Australian Commercial Catering Pty Ltd
v
Mrs Marcelia Powell
(C2014/3631)

COMMISSIONER ROE MELBOURNE, 10 APRIL 2014

Application to vary redundancy pay.

[1] Australian Commercial Catering Pty Ltd (the Applicant) lost the catering contract at Robert Bosch effective from 25 October 2013 and advised employees of that fact on 16 August 2013. Ms Powell had been employed as a full time employee by the Applicant working on the Robert Bosch contract for nine years. Ms Powell was advised on that date that she could seek to continue her employment with the new provider to Robert Bosch (Alliance Catering) in which case she would be paid her entitlements by the Applicant or she may be offered an alternative position with the Applicant or if there is no other position available with the Applicant or if she was unsuccessful in continuing with the new contractor she would be made redundant.

[2] As at 23 October 2013 no alternative position with the Applicant had been found and discussions with Alliance about employment with them were continuing. On 23 October 2013 the Applicant wrote to Ms Powell and advised that they were now able to “offer you a position with us should you decline your offer with Alliance Catering.” The letter also advised “please note that if you do not take up the Alliance or ACC offer you will not be entitled to the redundancy offer.” This was a clear reference to the issue of entitlement to redundancy payments which had been the subject of earlier correspondence on 11^th and 17^th of October 2013 where Ms Powell was put on notice that if she rejected an offer of employment with the new employer on terms and conditions substantially similar to those with the old employer then redundancy payments would not apply. On 25 October 2013 Ms Powell advised the Applicant that she was not taking up employment with Alliance and was also not taking up the alternative position with the Applicant. Ms Powell declined the options on offer because the hours offered by Alliance were unsuitable and because Ms Powell could not manage the logistics of travelling to the location of employment offered by the Applicant.

[3] The Applicant is seeking pursuant to Section 120 of the Fair Work Act 2009 (Cth) (the Act) that the 16 weeks redundancy entitlement which they say would otherwise have been payable to Ms Powell be reduced to zero on the grounds that the Applicant offered Ms Powell suitable alternative employment working on another contract for the Applicant on equivalent terms and conditions.

[4] In response to my question the Applicant advised that it was not arguing that this was a transfer of employment situation dealt with under Section 122 of the Act.

[5] This matter was subject of Hearing on 8 April 2014.  Having heard from the parties I issued a decision on transcript.

[6] For reasons outlined on transcript I accepted the submission of the Applicant, Australian Commercial Catering Pty Ltd, that Ms Powell was entitled to be paid an amount of redundancy because of Section 119 of the Act and that the employer had obtained other acceptable employment for the employee. For the reasons outlined on transcript I considered the offer of employment with the Applicant at another site to be other acceptable employment because it was on terms and conditions substantially similar to the pre-existing terms. I did not consider that the distance of the relocation from Clayton in Melbourne to Tooronga in Melbourne altered this judgment.

[7] For the reasons outlined on transcript I took into account the particular reasons why the employment was not acceptable to Ms Powell and I determined that it was appropriate in all of the circumstances to reduce the amount of redundancy pay to 33% of the entitlement specified in the correspondence to Ms Powell from Australian Commercial Catering Pty Ltd dated 17 October 2013. The amount payable is $3,254.50. Given that Ms Powell’s employment with Australian Commercial Catering Pty Ltd ended on 25 October 2013 it would be inappropriate for there to be further delay in the payment of her entitlements.

[8] I will Order that to the extent that Ms Powell is otherwise entitled to redundancy payment arising from the termination of her employment with Australian Commercial Catering Pty Ltd the amount of that redundancy payment shall be reduced to 33% of the entitlement specified in the correspondence to Ms Powell from Australian Commercial Catering Pty Ltd dated 17 October 2013; that is, the amount is reduced to $3,254.50. The amount payable shall be paid within 14 days of the date of this Order.

COMMISSIONER

Appearances:

Mr P Darmos appeared for the Respondent.

Hearing details:

2014

Melbourne

April 8

Printed by authority of the Commonwealth Government Printer

<Price code A, PR549578>