“Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers' Union (AMWU) and the Australian Workers' Union v UGL Operations and Maintenance Pty Ltd..
[2017] FWC 1244
•3 MARCH 2017
| [2017] FWC 1244 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.533 - Application for an Order
“Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) and
The Australian Workers’ Union
v
UGL Operations and Maintenance Pty Ltd T/A UGL
(C2016/6898)
DEPUTY PRESIDENT GOOLEY | MELBOURNE, 3 MARCH 2017 |
Application for an order.
[1] On 2 November 2016, UGL Operations and Maintenance Pty Ltd was advised by VIVA that it would require UGL to substantially reduce the number of employees it provided to perform maintenance at the VIVA refinery at Geelong.
[2] The “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (the AMWU) and The Australian Workers’ Union (the AWU) alleged that UGL failed to provide them with an opportunity to consult about measures to avert or minimise the proposed dismissal and measures to mitigate the adverse effects of the proposed dismissals. 1
Events which are not in dispute
[3] On 2 November 2016, VIVA advised that they required 36 employees to be provided by UGL. At that time UGL had approximately 72 permanent employees assigned to work at VIVA.
[4] On 3 or 4 November 2016, Mr Terry Elliott, UGL’s national industrial relations manager, advised Mr Tony Hynds, an organiser with the AMWU and Mr Gavin Penn, an organiser with the AWU, that there would be redundancies. 2 Mr Penn recalled this telephone call taking place on 9 November 2016.3
[5] On 7 November 2016, site management met with the local employee representatives to discuss the pending redundancies. 4
[6] On 9 November 2016, UGL advised its workforce in writing that it would need to reduce its workforce by around 50% almost immediately. The employees were told that UGL would consult with them. UGL advised that employees who wished to be considered for voluntary redundancy should make that election by 12pm on 14 November. 5
[7] On 11 November 2016, a meeting of the AMWU, AWU and UGL was held to discuss the redundancies.
[8] At the meeting Mr Hynds asked UGL to let the redundant workers know the outcome as soon as possible. 6
[9] On 11 November 2016, UGL provided the AMWU and AWU the selection criteria to be used in selecting employees for redundancy. 7
[10] On 17 November 2016, redundant employees were advised. They were advised that there were no suitable alternative positions for the employees and their termination took effect that day and they were paid in lieu of notice and paid all entitlements.
The meeting of 11 November 2016
[11] UGL explained why redundancies were necessary and advised that it would call for voluntary redundancies. 8
[12] Mr Hynds said that at this meeting the unions asked for a copy of the selection criteria and asked what redeployment opportunities there were. The unions also asked that the redundant employees be given preference in future hirings. UGL told them they would get back to them about these proposals. They also asked for UGL to facilitate Protect, the redundancy fund’s access to the site. 9 Mr Penn said in addition he asked if employees could take leave including accrued RDO’s. Mr Penn said that UGL did not respond to this suggestion.
[13] Mr David Ainger, the People and Culture Manager for UGL, explained that UGL did not know final numbers at that time because VIVA had not confirmed its future requirements. Discussions occurred about alternative work and future shut downs. Mr Elliott said that there were currently no suitable vacancies other than roles interstate on future shut downs. Mr Ainger said that his own enquires had supported Mr Elliott’s advice. 10
[14] Mr Ainger said that Mr Stephen Roberts, the Contract Manager, said that they had looked at employees taking leave but had decided that “these short term measures were not feasible in addressing the shortfall in workload.” 11
[15] Mr Ainger said that Mr Elliott had told Mr Penn and Mr Hynds that the redundant employees could not be guaranteed future roles and that experienced refinery workers would have an advantage in the selection process. Mr Ainger said that the unions asked if UGL could provide outplacement services and Mr Ainger agreed to do so. An outplacement service was provided to employees. 12
[16] Questions were asked about the selection criteria and it was agreed that this would be provided to the unions. 13 Mr Roberts said that concern was raised by the unions about who would do the evaluations as they were concerned that if it were done by casual supervisors they would not have sufficient knowledge of the workers. In response, UGL explained that the evaluations were part of the normal performance assessment done in June so that issue would not arise.
Other relevant matters
[17] While the number of employees originally to be made redundant was 36, UGL through discussions with VIVA was able to reduce this number to 30. In addition, three employees opted to take voluntary redundancy. Further, an employee took long service leave. 14 UGL provided to the redundant employees a list of all future shutdowns and the contact email address of the relevant recruitment officer so that they could lodge an expression of interest. Mr Ainger said that this information is not normally provided to employees.15 Mr Ainger said only one person expressed interest about working at the Orica shutdown but when contacted was not available.16
[18] Mr Penn gave evidence that since the redundancies, additional employees have been engaged by UGL at the VIVA site and none of the redundant employees have been engaged. Mr Roberts agreed that there had been some additional employees engaged. He said that they had looked at the list and had engaged some casuals who had worked on the shut down and some other people. He said that the redundant employees had not been available.
[19] UGL facilitated the entry of Protect onto the site so that members could discuss issues with it.
Submissions of the AMWU and AWU
[20] In their written submissions the unions pointed to the difficult position faced by employees in the Geelong region. The area has been hit by significant job loses.
[21] The unions submitted that UGL did not take its obligations under section 531(3)(a) seriously. They submitted that UGL gave little more than lip service to its obligations. They pointed to the short time between the meeting on 11 November 2016 and the termination of employees on 17 November 2016. They submitted that UGL could not have researched vacancies in its own operations and those of its clients in this time. They submitted that there should have been a follow up meeting.
[22] The unions submitted that UGL could have agreed to give the redundant employees priority for future work.
[23] The unions also submitted that UGL could have again raised with the unions their proposal to cut costs. In June 2016, UGL had proposed to cut the rates of pay of employees but this proposal to vary the enterprise agreement was rejected by employees. UGL said that it had put this proposal to employees because it was under pressure from competition that did not have a union enterprise agreement. Given what was predicted had now come to fruition, the unions submitted that UGL should have raised it again as the response may have been different.
[24] The unions submitted that UGL should have, prior to the meeting, done more preparation on job saving measures so that it could have offered concrete redeployment and rehiring options.
[25] In response to my questions as to whether the time for consultation had been shortened at the unions’ request, the unions submitted that UGL’s obligations were set out in the Act and the unions could not waive that obligation.
[26] In response to UGL’s submissions, the unions said that UGL cannot hide behind VIVA. It was aware of its obligations under the Act when it enters into contracts.
Submissions of UGL
[27] UGL submitted that once it was aware of VIVA’s reduced requirements for labour it immediately notified the unions. It said Mr Penn’s evidence, that he was not notified until 9November 2016, should not be accepted. UGL said it then notified the delegates and then notified the employees. It said that the meeting on 11 November 2016 involved real consultation. The unions raised matters and UGL responded.
[28] It submitted that at the time there were no redeployment opportunities for the redundant employees. However it did provide information about future interstate casual positions. It arranged outplacement services and Protect attended the site. It also negotiated with VIVA to reduce the number of redundant employees. It submitted that it could not engage in a long consultation process as it was at the whim of another company. It submitted that in the circumstances swift action was necessary particularly as Geelong was a hazardous site. In relation to the selection criteria, after providing the unions with it, there were no issues raised with UGL by the unions or the delegates. It had subsequently followed up the one person who had expressed interest in working at Orica but they were no longer available. It said it had complied with its obligations under the Act and under its agreement.
Consideration
[29] I accept the submissions that the opportunity to consult must be real. Consultation involves the opportunity for one party to put forward proposals and for those proposals to be given genuine consideration.
[30] On the evidence before the Commission, I am satisfied that the unions were provided with an opportunity to put forward proposals and that UGL gave genuine consideration to those proposals.
[31] The unions asked for information about the selection criteria. This was provided and no further issues were raised about it.
[32] The unions asked if the employees could be redeployed. I am satisfied that Mr Ainger reviewed vacancies across all business in all locations and that there were no suitable vacancies. Further, UGL provided each employee with information about upcoming shuts, albeit interstate, including the contact details of the relevant recruitment personnel.
[33] The unions asked if employees could take accrued leave. This was rejected though it was the evidence before me that one employee at least was allowed to take long service leave which reduced the number of redundant employees. I am satisfied that UGL gave consideration to this proposal but made the assessment that it would do no more than delay the redundancies.
[34] The unions asked that the redundant employees be given preference for future vacancies. UGL did not agree to this.
[35] Mr Ainger, in his oral evidence, explained that when recruiting they used their data base of existing and past employees, plus recommendations from supervisors as well as they advertised through agencies such as SEEK. If the redundant employees wanted re-engagement they would need to go through a proper recruitment process. This was because different jobs require different skill requirements and each site may have site specific requirements. He said that Mr Elliott had explained at the meeting that any VIVA employees would be looked at but they would not be given priority.
[36] The unions asked that the redundant employees be given further casual work at the refinery. Again, UGL did not agree to this. Mr Roberts’ evidence was that when such vacancies arose they did consider some of these employees but none were available.
[37] The unions asked for outplacement services and these were provided. The unions asked for Protect to be able to come on site and this was done.
[38] The unions asked for the employees to be notified as soon as possible and this was done.
[39] The unions made no request after 11 November 2016 for a further meeting. The unions raised no other issues after the meeting.
[40] UGL also took steps through continuing negotiations with VIVA to reduce the number of employees it needed to make redundant. UGL also implemented voluntary redundancy to reduce the number of employees it needed to make redundant.
[41] I do not accept the submission that UGL did not take its obligations to provide the unions with an opportunity to consult seriously. As soon as UGL knew that redundancies were possible it notified the unions. It had discussions with the local delegates and then the union organisers. The organisers had an opportunity to put proposals to UGL and those proposals were considered and in some cases acted upon. There was no proposal from the unions that UGL revisit its proposal to cut wages and UGL cannot be criticised for not raising it again.
[42] I am satisfied that UGL considered seriously the proposals put forward by the unions. It is clear that the central proposal, namely that these employees be given priority in future hirings, was not accepted. While it would have been preferable for UGL to have provided clearer feedback to the unions as to why this proposal was not accepted I do not consider its failure to accept the proposal means that they did not genuinely consider it. Further they did take steps to alert employees to future casual interstate positions and give them access to recruiters not available to other applicants.
[43] While I accept that the unions are not able to waive UGL’s obligations under section 531(3) I consider that the unions themselves contributed to the short time frame because they asked that the process be truncated.
[44] For these reasons, the unions’ application is dismissed.
DEPUTY PRESIDENT
Appearances:
B. Terzic and C. Winter for the Applicant.
T. Elliott for the Respondent.
Hearing details:
2016.
Melbourne:
30 November.
2017.
Melbourne:
20 February.
1 Section 531(3) of the Fair Work Act 2009
2 Exhibit A2 at [8]
3 Exhibit AWU1 at [5]
4 Oral evidence of Mr Roberts
5 Exhibit A2 at attachment B
6 Ibid at [15]
7 Ibid at attachment C
8 Ibid at [11]
9 Ibid at [12]-[14]
10 Exhibit R2 at [14]
11 Ibid
12 Ibid at [16]-[17]
13 Exhibit R1 at [17]
14 Oral evidence of Mr Roberts
15 Oral evidence of Mr Ainger
16 Ibid
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