Australian Municipal, Administrative, Clerical and Services Union v Australian Tax Office
[2013] FWC 2470
•23 APRIL 2013
[2013] FWC 2470 |
FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.739—Dispute resolution
Australian Municipal, Administrative, Clerical and Services Union
v
Australian Tax Office
(C2012/999)
Commonwealth employment | |
VICE PRESIDENT LAWLER | SYDNEY, 23 APRIL 2013 |
Alleged dispute concerning APS 3 employees positions.
[1] This is a dispute referred to the Commission by the Australian Municipal, Administrative, Clerical and Services Union (ASU) pursuant to the dispute resolution procedure in the ATO Enterprise Agreement 2011 (Agreement).
[2] In July 2012 five Australian Tax Office (ATO) offices in Melbourne were consolidated into a single, newly fitted-out building at “Collins Square”, 747 Collins Street. Prior to that consolidation there were eight APS 3 staff employed in the Facilities Management Branch who were required to ensure that the Facilities Management functions were performed in respect of those five separate sites. Following the consolidation the ATO requires less of those staff to manage the single “Collins Square” site. In particular, the ATO is determined that it requires only four APS 3 positions in the Facilities Management Branch for the efficient and economical working of its operations at the new “Collins Square” site. What is at issue in the dispute is the process by which the ATO proposes to reduce the number of APS 3 Facilities Management employees from eight to four.
[3] On 27 July 2012 Assistant Commissioner Smillie wrote to the ASU in the following terms:
“CONSULTATION PROCESS: MANAGING POSSIBLE EXCESS STAFF IN THE MELBOURNE CENTRAL BUSINESS DISTRICT.
The purposes of this correspondence is to inform you of the planned actions to manage the issue of possible excess APS 3 staff within the Melbourne CBD site located at 747 Collins Street.
As you may be aware there has been a process under way within the Melbourne CBD to consolidate the following ATO occupied buildings into a single location at 747 Collins street:
...
One impact of this consolidation is that the current numbers of APS 3 staff is greater than those required to manage a single modern building. There will be a lesser work load as a result of the new premises as is evidenced in other CBD areas where the ATO has consolidated lease holds such as the ACT.
The following advice has been sent (sic) to the affected staff on Wednesday, 1 August outlining the proposed process to address the situation of excess APS 3 staff.
I am writing to inform you that Property, Security and Environmental Services (PS&ES) now has more APS 3 staff in the Melbourne CBD than are required or affordable. This means that not all APS 3 staff will hold a position in the Melbourne CBD in the medium to long term.
As you are aware this situation has arisen due to the recent moves from the various Melbourne CBD sites, with the following ATO buildings have been consolidated into a single CBD building located at 747 Collins St.
414 Latrobe St
390 Latrobe St
350 Queen St
World Trade Centre
Casselden Place
Due to this reduction in the number of ATO sites, we will need to reduce the numbers of APS3 staff accordingly. We have sought advice and looked at the various options to achieve this in the fairest way, and are proposing to run a process where the affected CBD staff will be given an opportunity to apply for the positions within the new Collins St building. The successful APS 3 staff will be selected based on merit and the opportunity to apply for these positions will only be open to the current APS 3 staff who occupy positions within the CBD.
To ensure that the process is open and transparent we will work with ATO people to ensure an independent selection committee is appointed to run the process. Any staff that are not successful through this process will be supported by the ATO as per the ATO Enterprise Agreement 2011.
I will also be writing to the Unions to ensure that they have an opportunity to provide feedback on the proposed process. My intention will be to begin this process as soon as practical after I have received any feedback and will keep you informed when we have timeframes for the process to commence so that each of you has the same opportunity to prepare and apply for the available positions. Please contact me on ext 66104 if you have any questions about this process.
If you have any feedback I would appreciate you returning it to the Director of Facilities Management, Andrew Osborne by COB 10th August 2012”
(underline emphasis added)
[4] By letter dated 2 August 2012 the ASU advised the ATO that it was in dispute over the application of the Agreement in relation to the proposal. The ASU wrote:
“AC Smillie advised staff that he has sought advice, considered options and proposes to run a process where the affected APS 3 staff will apply for the reduced number of their own jobs. The unsuccessful staff will be supported by the ATO as per the ATO Enterprise Agreement 2011.
AC Smillie’s proposal, made with ‘advice’ is contrary to clause 118 of the Agreement. The ATO is obliged to follow the measures in clause 118.5 and following before it can consider commencing a process for selecting which employees are excess as is now proposed.”
[5] The letter sought to activate the dispute resolution procedure in the Agreement. The matter came before Deputy President Smith for conciliation on 3 October 2012. In accordance with a recommendation by Smith DP there was a further meeting of the parties on 7 November 2012 and there was an exchange of views in written correspondence. A further conciliation conference was held on 9 January 2013. Smith DP’s recommendation noted the “process raised in the letter of 27 July [2012] to the Australian Services Union constitutes a proposal for discussion.”
[6] It is necessary to set out clauses 117 - 119 of the Agreement in full:
“117. Excess employees
117.1 This clause only applies to ongoing employees who are no longer on probation.
When is an employee excess?
117.2 An employee becomes excess for either of the following reasons:
a) the duties of the employee are transferred to a different capital city or to an office which requires a move of a similar scale, involving a necessary change of residence, and
i) the employee is unwilling to perform duties at the new office; and the Commissioner is unable to provide ongoing work at the first office; and
ii) the Commissioner agrees redundancy is an economically viable alternative to relocation.
b) the Commissioner determines that the employee is a member of a given class that has more members than is necessary for the efficient and economical working of the ATO in a particular location.
118. Preventing excess employee situations
Consultation with employees and their representatives
118.1 The ATO will consult with employees and their representatives where the provisions of this clause need to be exercised.
a) Consultation and communication processes established under clauses 2 and 3 of this Agreement will be used to consult employees and their representatives about workforce adjustment issues;
b) The briefings of employees and their representatives, under sub-clause 3.3 of this Agreement, will be used to explain the overall funding and likely staffing situation of the ATO. It is envisaged these meetings will be held when data is available from the Budget and the additional estimates process;
c) Employees and their representatives will be consulted in relation to possible national corporate measures which could be taken under this clause to prevent excess employee situations.
Preventing excess employee situations
118.2 This clause only applies to ongoing employees who are no longer on probation.
118.3 The ATO will, as far as practicable prevent excess employee situations through:
a) an employee retraining/redeployment approach so that employees prepared to acquire new capabilities within an appropriate time can reasonably expect to be employed by the ATO, and/or
b) the measures set out in clause 118.5 to 118.7.
118.4 Where the provisions in 118.3 are not successful in preventing excess employee situations, the ATO will take actions consistent with any APS wide redeployment principles.
Measures for preventing excess employee situations
118.5 To prevent excess employee situations, the ATO will:
a) where appropriate, seek alternatives to redeploying employees, such as moving work, or
b) reassign the employees to other duties in their sub plan within their current site; or
c) if action taken under a) and b) above does not prevent the excess employee situation then the ATO will attempt to reassign employees to other sub plans within the site (refer to sub-clauses 118.7 and 118.8), or
d) where the above actions do not prevent the excess employee situation then the ATO will attempt to reassign the employees to each employees current sub plan within the region.
The order of action taken by the ATO under this sub-clause may be varied following consultation with the employees and their representatives.
118.6 Where a sub plan has undertaken the measures in clause 118.5 and still cannot prevent an excess employee situation the sub plans will participate in corporate workforce adjustment activities.
Information in relation to these activities will be available to employees and their representatives.
118.7 The ATO will assess employees, identified as being in a situation where they are likely to be excess, for suitability for any identified ongoing job opportunity in the ATO prior to it being filled in another way. In this context, suitability of an employee will be based on:
a) suitability for the work in areas where they could be redeployed, not on their relative suitability for work in the current work area; and
b) the employee’s ability to perform satisfactorily within a maximum of three months.
Where there are insufficient volunteers, the ATO may identify and redeploy an employee from the group of potentially excess employees.
Factors to be considered in redeployments under this clause
118.8 The following factors will be taken into account in redeploying employees:
a) Employees working in ATO sites outside the greater metropolitan area of capital cities (e.g. Geelong, Newcastle Townsville, Wollongong and Albury) will be given first consideration for additional job opportunities that arise in those sites as the size of the offices means there are different opportunities to those in metropolitan regions;
b) Within the greater metropolitan area of capital cities, on occasions it may be more practicable and reasonable to redeploy an employee between BSLs in their current site, than to re-assign the employee to a job in a different site in their current BSL. To the extent practicable, employee preferences and ‘hardship’ factors will be taken into consideration in redeployment decisions;
c) Employees may express interest in redeployment to another region, but the first priority will be to find jobs for employees within their current region. The ATO is not obliged to redeploy employees between regions and such redeployments do not have priority over other vacancy filling methods unless determined by the Commissioner;
d) Where a site is closing, employees may express a preference for a site for their redeployment. The ATO will take this preference into account in corporate workforce adjustment activities.
118.9 An employee who is redeployed to another office in the same city will be eligible for the relocation provisions under clause 112.
118.10 If both the ATO and the employee agree on redeployment to another region, the move may be considered to be in the interests of the ATO.
119. Redundancy provisions
Application
Where measures under clause 118 do not resolve the situation
119.1 This clause only applies to ongoing employees who are no longer on probation.
If, despite relevant steps having been taken under clause 118, an excess employee situation is likely to arise, the six steps set out in this clause will be taken.
119.2 Where 15 or more employees are considered to be excess, steps 3 to 6 below will apply as well as any relevant provisions provided for by relevant legislation.
119.3 Where less than 15 employees are considered to be excess the following steps will apply.
119.4 The six steps are:
Step 1
Affected employees and where they choose, their representatives, will be informed and will be provided with the following information:
a) the reasons why employees are likely to become excess; and
b) the time when, or the period over which, it is likely to occur.
When advising affected employees of the situation, the ATO will specifically ask the affected employee to identify which representative they wish the ATO to advise of the situation.
Step 2
1. Employees and, where they choose, their representatives will have one month for consultation with ATO management about:
a) measures that have been, or could be, taken to remove or reduce the likelihood of excess employees;
b) redeployment prospects for the employee(s) concerned;
c) the appropriateness of using voluntary redundancy; and
d) the method of identifying an employee as excess, having regard to the efficient and economical working of the ATO and the relative efficiency of employees.
2. If the invitation to be consulted is declined or it is agreed that the full period is not needed, follow on action may be taken before the end of the one month period.
3. If the Commissioner agrees, the period will be extended beyond one month.
4. Apart from employees who express interest in voluntary redundancy, no employee will be notified that they are excess within one month of the consultation period commencing.
Step 3
1. If redeployment or other measures are not feasible or only partially remove the problem, the Commissioner will identify the employees who are considered to be excess.
2. Nothing in these procedures will prevent excess employees being identified by seeking informal expressions of interest in voluntary redundancy. Employees who lodge an informal expression of interest in Voluntary Redundancy will be provided with, or given access to, information in relation to their likely entitlements. This could take the form of access to ‘selfhelp’ methods of estimating final leave/severance payments and superannuation benefits.
3. Where the ATO determines that it is effective and economical to do so, the ATO will facilitate the use of swaps to maximise the extent to which redundancies are voluntary.
4. Employees must be notified in writing that they are excess employees.
Step 4
1. Employees who are identified as being excess will be provided with the following information:
a) estimates of severance benefits, pay in lieu of notice and pay in lieu of any unused annual, purchased or long service leave credits;
b) the estimated amount of taxation the ATO will deduct from any payments;
c) access to superannuation information;
(i) For employees who are members of the CSS or PSS (either defined benefit or accumulation plan) the ATO is authorised by the employee to obtain details of accumulated superannuation contributions and the options available to those employees in relation to superannuation. The ATO will provide this information to the employee;
(ii) Employees who are not members of either the CSS or PSS funds are responsible for obtaining details about their options in relation to superannuation from their superannuation fund. The ATO will, where possible, assist the employee to get this information by providing relevant information in writing to the employee; and
d) the retention provisions which apply if the employee declines an offer of voluntary redundancy, including information about how the amortised salary would be calculated if they nominate the Alternate Retention Period as determined by Step 5 (4).
2. Once the employee has been provided with the information as set out in a), b) and c) (i) and d) above, and for an employee covered by c) (ii) they have had reasonable time to get the information, they will be made a formal offer of voluntary redundancy. An employee will have up to two weeks to accept or decline such an offer. Where the employee declines the offer, they will be required to, at the same time, nominate which retention period provisions they wish to apply to them (ie. the Retention Period as determined by Step 5 (3) or the Alternate Retention Period as determined by Step 5 (4).
3. Employees who accept the formal offer of voluntary redundancy will be given notice of termination and will be paid a voluntary redundancy severance benefit. With the agreement of the employee, follow on action may commence inside the two week period.
4. If the employee does not respond to the ATO within the two week period provided in subclause 2 above, they will be taken to have declined the offer.
5. If the employee does not nominate a retention period within the two week period provide in sub-clause 2 above, the retention period under Step 5 (3) will apply to them.
6. The ATO will not make a further offer of a voluntary redundancy to the employee at later steps in the process.
Step 5
1. Employees who decline the offer of voluntary redundancy will begin a formal retention period, to apply from that date.
2. Where the ATO determines that it is effective and economical to do so, the ATO will facilitate the use of swaps to maximise the extent to which redundancies are voluntary.
3. Retention period - An excess employee who declines the offer of voluntary redundancy will be entitled to the following period of retention:
a) 13 months where the employee has 20 years or more service or is over 45 years of age; or
b) 7 months for all other employees,
reduced by the relevant NES redundancy pay period that would apply to the employee at the end of 7 or 13 months retention period.
4. Alternate Retention Period - Where an employee elects to enter into the retention period provisions under this sub clause, the employee’s retention period determined in 3 above will be:
a) 13 months where the employee has 20 years or more service or is over 45 years of age; or
b) 7 months for all other employees.
5. Payment of salary during retention period
a) Unless (b) below applies an employee will be paid at their ordinary rate of pay during their retention period.
b) (i) Where an employee elects to enter into the Alternate Retention Period provisions their total pay throughout the retention period will be reduced by an amount equivalent to the employee’s redundancy pay entitlement under the NES, with such redundancy pay period entitlement calculated as at the expiration of the retention period.
(ii) For the purposes of (b)(i), the reduction of the employee’s ordinary pay will be amortised over the duration of the retention period.
6. If during the Alternate Retention Period the employee ceases to be excess (other than by termination of employment for the reason of being excess) amortisation will cease and the amount deducted as part of the amortisation provisions will be paid to the employee.
Step 6
Employees who cannot be placed in a suitable job within three months of declining an offer of voluntary redundancy:
a) will be advised that, because sufficient work is expected to remain available, it is intended to retain their services for the whole of their retention period, including the period since the offer of voluntary redundancy was rejected. In other than exceptional circumstances, it is expected that this will normally be the case but it may be necessary for affected employees to move to a different type of work, for which they are suitable, during this period; or
b) where the Commissioner is satisfied at any time in the remaining retention period that there is insufficient productive work available for the employee during the remainder of the retention period and that there is no reasonable redeployment prospects in the APS, the Commissioner may:
i. Give written notice of the involuntary termination of the employee’s employment under s.29 of the PS Act; or
ii. by agreement with the employee, give written notice of involuntary termination of their employment; or
c) will be given 4 weeks’ written notice of the intention to reduce their classification so that they can be redeployed to suitable employment, in which case income maintenance will apply instead of an involuntary redundancy benefit;
d) may at any time, be given written notice of the involuntary termination of the employee’s employment under s.29 of the PS Act.
Support for excess employees
119.5 Employees who are identified as being excess, or offered a voluntary redundancy, will be reimbursed for the costs of the following support where they choose to use it:
a) career, lifestyle and/or financial planning by a qualified advisor; and/or
b) assistance with preparation of applications for job interviews.
The maximum total amount of reimbursement under a) and b) is $2,200.
119.6 During any notice or retention periods referred to in this clause:
a) the ATO will provide assistance to the employees to try to find opportunities to redeploy the employee to another agency. This includes actions consistent with any APS wide redeployment principles; and,
b) excess employees will be given reasonable time to attend employment interviews, including reasonable travel and incidental expenses where these are not met by the prospective employer.
119.7 Where an excess employee has to move their household to a new locality as a result of a movement at level or reduction in classification, they will be entitled to reasonable travel and relocation expenses as if being promoted.
Payment if reduced in classification
119.8 If an employee is reduced in classification, the employee will maintain the base salary they had immediately prior to the reduction for either 7 or 13 months, less the period of employment since the offer of voluntary redundancy was rejected.
Notice period
119.9 The following notice periods will apply where employment is terminated:
a) if over 45 years of age, with at least 5 years continuous service: 5 weeks’ notice;
b) other employees: 4 weeks’ notice.
Voluntary redundancy benefit
119.10 An employee who elects for retrenchment with a redundancy benefit and whose employment is terminated by the Commissioner under s.29 of the Public Service Act 1999 on the grounds that he/she is excess to the requirements of the ATO, is entitled to payment of a redundancy benefit of an amount equal to two weeks’ salary for each completed year of continuous service, plus a pro-rata payment for completed months of service since the last completed year of service, subject to any minimum amount the employee is entitled to under the NES.
Attachment C sets out certain conditions relating to service for redundancy benefit purposes.
119.11 The minimum sum payable will be an amount equal to 4 weeks’ salary and the maximum payable will be equal to 48 weeks’ salary.
119.12 The redundancy benefit will be calculated on a pro rata basis for part time hours during the period of service if the employee has less than 24 years full time service.
119.13 This benefit will be in addition to any payment in lieu of the notice period and accrued annual leave, long service leave and purchased leave credits.
Involuntary redundancy benefits
119.14 Where employment is terminated involuntarily, employees will be paid a sum calculated as follows:
a) for employees with 20 or more years of service or over 45 years of age:- a lump sum equal to 13 months salary reduced by the amount of salary paid since the date the offer of voluntary redundancy was rejected; or
b) for others:- a lump sum equal to 7 months salary reduced by the amount of salary paid since the date the offer of voluntary redundancy was rejected.
119.15 Such employees will receive payment in lieu of accrued Annual Leave and Purchased Leave calculated as if the date of termination of their employment is 13 months or 7 months (as the case may be) later than the date the offer of voluntary redundancy was rejected.
119.16 If the total amount payable is less than the total amount (including pay in lieu of leave) that would have been payable had the employee accepted the offer of voluntary redundancy (reduced by any salary received since the date the offer was rejected), the employee will be aid an additional amount to bring the total benefit to that amount.
Salary for calculating benefits
119.17 For calculating redundancy benefits, an employee’s salary will include:
a) HDA, if received on the date notice is given and has been payable for a continuous period of at least 12 months at that date;
Where the higher duties of an employee who has received HDA for a continuous period of 12 months is ceased due to the workforce adjustment process necessitating the redundancy, and the employee would otherwise have continued to receive higher duties until the date notice was given, the higher duties will be taken to have continued to the date notice was given for the purpose of this clause.
b) an average of shift penalties over the 12 months prior to notice being given, provided shift work has been rostered in at least 26 weeks; and
c) any other regular allowance in the nature of salary received on the date notice is given.”
(underline emphasis added)
Summary of the contentions of the parties
[7] The ASU’s essential submission is that the process outlined in the 27 July 2012 letter from the ATO is not permissible under clauses 117, 118 and 119 of the Agreement. The ASU contends that clauses 118 and 119 constitute a ‘code’ which must be observed by the ATO and followed in a sequential fashion. In particular, the ASU contends that the obligations under clause 118 must be complied with before the procedure in clause 119 is commenced. In that regard the ASU places a particular emphasis on the sub-heading to clause 119.1 and the second paragraph of clause 119.1. The ASU also places emphasis on the last portion of clause 118.5 together with the overall structure of clause 118 in submitting that the ATO is obliged to discharge its obligations under clause 118 before moving to clause 119 and the fact that variations to the action required by clause 118.5 can only occur following consultation with the employees and their representatives provides significant support for that contention.
[8] The ASU contends that clauses 117 to 119 do not permit the use of voluntary redundancy except in the circumstances outlined in clause 119.4. The ASU also places particular emphasis on clause 118.7 and argues that the “suitability” focus of clause 118.7(a) is inconsistent with the ATO conducting a merit based selection process to determine which of the eight Facilities Management employees will retain their jobs.
[9] The ATO contends that on the proper construction of the Agreement clauses 118 and 119 are to be applied in a practical and business like fashion and that there is no strict sequence as contended for by the ASU.
[10] The ATO also contends that the invitation to employees to submit expressions of interest in receiving a voluntary redundancy is a step that is consistent with clause 118.3 of the Agreement. The ATO also contends that seeking expressions of interest and proposing a merit based selection scheme of the sort set out in the 27 July letter is consistent with clause 118.5(a) as the proper alternative to redeployment that is being sought, reasonably, by the ATO.
[11] The ATO places particular reliance on item 4 of Step 2 and item 2 of Step 3 in clause 119.4 as indicating that it is permitted to seek informal expressions of interest in voluntary redundancy at any time.
Consideration
[12] The principals of construction are well known and do not need to be recited here.
[13] Clause 117 is definitional and specifies when an employee becomes excess. It distinguishes between two situations specified in clause 117.2(a) and (b). In the present case it is the situation in clause 117.2(b) that is relevant. An employee in that situation becomes excess when the Commissioner formally “determines” the employee to be excess. That formal determination cannot occur until Step 3 of the process laid down in clause 119.4 is completed. Prior to that formal determination an employee may be “likely to be an excess employee” or a “potentially excess employee”.
[14] Clause 118.3 imposes an obligation on the ATO to prevent excess employee situations through the measures specified in clauses 118.3(a) “and/or” 118.3(b) but only “as far as practicable”. The language recognises that it may not be practical to prevent an excess employee situation through those measures.
[15] When an “excess employee situation” exists clause 119 provides a process that can lead, ultimately, to compulsory redundancy. While clause 118 is concerned with “preventing excess employee situations” and is focussed on prevention through redeployment, it is not confined to redeployment. Clause 118.5(a) requires the ATO to “seek alternatives to redeploying employees, such as moving work” where this is appropriate.
[16] When the measures specified in clause 118.5 have been considered but have not prevented the “excess employee situation”, clause 118.7 imposes a continuing obligation on the ATO to consider redeployment for employees who are “likely to be excess”.
[17] So far as clause 118.6 is concerned, it is unclear precisely what is meant by “corporate workforce adjustment activities”. The ATO’s written submissions note:
“4.20 ... On the face of the provision, it is not clear what measures are envisaged by this expression, nor the extent (if any) to which such activities overlap with any or all of the types of measures for which earlier subclauses make provision. In the real world of day to day ATO life, however, the expression is maturely understood and implemented. In practice, and in accordance with guidance available on the ATO staff intranet, “corporate workforce adjustment activities” generally involve:
(a) adding excess employees to a national register which vacancy delegates are required to check before filling ongoing vacancies;
(b) giving excess employees special consideration for ongoing vacancies at level and within their region/location (i.e. assessing excess employees for suitability in isolation rather than relative to other candidates); and
(c) ATO People (which performs the human resources function with the ATO) liaising with national workforce adjustment contacts to try and identify suitable vacancies for excess employees.”
[18] Clause 118.7 tends to corroborate that submission.
[19] I agree with the submission on behalf of the ASU that on the proper construction of these clauses the ATO is required to attend to its obligations under clause 118 before it commences the redundancy process set out clause 119. The heading to clause 119.1 and the second paragraph of that clause are unambiguous and there is no reason why the ordinary meaning of those words should not be given effect.
[20] However, the delineation between the obligations imposed by clauses 118 and 119 is not sharp. Clause 119.4 lays down a six step process. Steps 1 and 2 are essentially consultation steps. The overlap between items 1(a) and (b) of Step 2 and clause 118 is obvious. Step 3 provides for the formal identification of employees as “excess” with Steps 4 and following providing for a familiar redundancy process whereby employees have the opportunity of accepting voluntary redundancy or moving into a retention period with compulsory redundancy at the end of that period if no redeployment occurs.
[21] A formal determination by the Commissioner that an employee is “excess” occurs at Step 3 of clause 119 and occurs only “[i]f redeployment or other measures are not feasible or only partially remove the problem”. That is, the Agreement contemplates that measures other than redeployment may partially remove the problem constituted by the likely excess employee situation.
[22] Adopting a practical approach to the construction of the Agreement, the absence of a clear delineation between clauses 118 and 119 counts against construing the reference to a consideration of voluntary redundancy in item 1(c) of Step 2 in clause 119 as indicating that voluntary redundancy can only be considered once the requirements of clause 118 have been complied with. It may also be noted that item 4 of Step 2 suggests that employees may be invited to consider voluntary redundancy before they are formally identified as “excess” under item 1 of Step 3.
[23] The language of clause 118 is broad and I can see no reason not to give a broad operation to the terms of clause 118.5(a). I am satisfied that the seeking of expressions of interest for voluntary redundancy contained in the ATO letter of 27 July 2012 is an alternative to redeployment within the meaning of clause 118.5(a), as is a merit selection process to determine which of the eight employees should retain their jobs and not face the prospect of being determined to be “excess”.
[24] Moreover, in my view item 2 in Step 3 of clause 119 should be read broadly and the reference to “these procedures” is not confined to the steps in clause 119.4 but relates to the procedures generally that can lead to redundancy including the procedure in clause 118. I place significance on the reference to the plural “procedures”. This also provides support for the conclusion that voluntary redundancy is one of the “other measures” that might “partially remove the problem”. Of course, such an offer is without prejudice to the ATO’s obligation to offer voluntary redundancy at Step 4 of the procedure in clause 119.4.
[25] The practical effect of AC Smillie’s letter of 27 July 2012 was to convey to the ASU a proposal on which consultation was proffered to address a likely “excess employee situation”. In the particular circumstances of the affected facilities management employees, it was most unlikely that the ATO could prevent that excess employee situation through the measures specified in clause 118.3 (a) or (b). It was reasonably open to the ATO to conclude that it was not practicable to prevent the “excess employee situation” in that way.
[26] Clause 118.5(a) authorises the ATO to propose alternatives to redeploying employees as a way of preventing the “excess employee situation”. In accordance with the practical approach to the construction of industrial agreements mandated by the authorities, and the objects of the Agreement, which emphasise flexibility, cooperation and productivity (see clause 1, particularly paragraphs (b), (c) and (f)), the proposal for offers of voluntary redundancies and a merit based selection process advanced by AC Smillie was consistent with clause 118.5(a). Those affected employees who decline to accept a voluntary redundancy as proposed in AC Smillie’s letter will, of course, retain their right to consider voluntary redundancy under Step 4 of clause 119.4.
[27] I am not persuaded that clause 118.7 has the operation for which the ASU contends in this case. In particular, I am not persuaded that clause 118.7 has the effect of prohibiting the ATO from conducting a merit based selection process to determine which of the eight employees will retain the four positions in the new Collins Square site and which will face the possibility of being determined to be excess and required to go through the redundancy process in clause 119.
[28] I am satisfied that the actions taken by the ATO thus far are actions that are properly in the discharge of its obligations under clause 118.
[29] Even if I had embraced the ASU’s case fully, in the exercise of my discretion in the particular circumstances of this case I would have declined to make any determination requiring the ATO to abandon its present course of seeking expressions of interest for voluntary redundancy. It needs to be appreciated that such expressions of interest are not compulsory and each of the eight affected employees is at perfect liberty to refrain from expressing interest in a voluntary redundancy without any adverse consequences flowing. The ATO is still obliged to comply with clause 119. This cases involves a classic redundancy situation. There are eight employees in a particular class for which only four jobs remain. The eight employees do not have technical taxation skills. The proposal advanced by AC Smillie in his letter of 27 July 2012 for consultation with the ASU was practical, sensible and fair.
[30] The questions posed for determination are answered as follows:
(a) Is a merit based selection process prior to, or as part of, clause 118 measures
permissible under the Agreement? Yes.
(b) Do clauses 118-119 need to be followed completely sequentially? Yes, albeit that there is a degree of overlap between what is required by clause 118 and what is required by Step 2 of clause 119.4. This does not mean that clause 118 and Step 2 of clause 119.4 can be complied with concurrently, rather it means that when the ATO has complied with its obligations under clause 118, it will be obliged to provide a further month for consultation on the matters specified in Step 2 unless it is agreed that the full period is not needed.
(c) Can the ATO seek expressions of interest in voluntary redundancy at this stage from the eight affected APS3 facilities management staff? Yes.
VICE PRESIDENT
Appearances:
R McPhee with J Lapidos for the Australian Municipal, Administrative, Clerical and Services Union.
J Snaden of Counsel with A Pick for the Australian Tax Office.
Hearing details:
2013.
Melbourne:
February 18.
Printed by authority of the Commonwealth Government Printer
<Price code C, AE889771 PR535921>
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