Bob Wickham v Quality Bakers Australia trading as Buttercup Bakeries

[1994] IRCA 178

CATCHWORDS

INDUSTRIAL LAW - termination of employment - redundancy agreement negotiated between Union and employer and not formalised before applicant made redundant - employees not informed of negotiations - procedure unsatisfactory - respondent proves valid reason based on operational requirements - application dismissed.

Industrial Relations Act 1988 Sections 170EA, 170 EE

BOB WICKHAM V. QUALITY BAKERS AUSTRALIA trading as BUTTERCUP BAKERIES

WI 154 of 1994

Before:   Linkenbagh J.R.

Place :   Perth

Date of hearing:   12 October and 10 November 1994

IN THE INDUSTRIAL RELATIONS COURT

OF AUSTRALIA  

Matter No. WI 154 of 1994

BETWEEN

Bob Wickham
  Applicant

AND

Quality Bakers
  Australia Limited
  trading as Buttercup
  Bakeries

Respondent

COURT:        LINKENBAGH J.R.

PLACE:         PERTH

DATE:            12 October and 10 November, 1994

REASONS FOR JUDGMENT

This is an application pursuant to Section 170EA of the Industrial Relations Act, 1988. The applicant is a 59 year old man and was a Bread Carter at the Malaga Bakery working a regular Monday to Friday shift, commencing at 2 a.m. when his employment was terminated on 13 May, 1994. He had been in the same job for about 18 years and in May, 1994 was earning $391.75 per week, after tax, and usually did a few hours overtime. The respondent paid the applicant $10,125 on termination, being the equivalent of 26 weeks pay, and also paid his other entitlements.

The Application was filed on 27 May, 1994, and it seeks reinstatement and/or compensation. Section 170 EE (8) of the Act has the effect that the amendments to Section 170 EE which came into effect on 30 June, 1994 apply to this Application, limiting the available remedies to reinstatement, or 6 months remuneration under the terms of the relevant Award, which is the Breadcarters (Metropolitan) Award No. 35 of 1963, which is made under a law of Western Australia. The applicant argued that he should be reinstated, and that is the primary remedy available in these proceedings. Compensation should only be considered where reinstatement is, in the opinion of the Court, impracticable (Section 170 EE (2)).

The Court finds the facts as follows:

1. From October, 1993 the respondent engaged in a review of bread delivery customers, as many were thought to be uneconomical, particularly those who purchased less than 50 units per week. By 29 April 1994 a decision was made to put off two runs, with another two to go by June, and a Supervisor who had left was not replaced.

1. Between 7 January, 1994 and 9 May 1994 212 uneconomical customers were identified.

1. Between July 1993 and May 1994 the number of bread round ds from the bakery reduced from 53 to 47. Three carters resigned and were not replaced and three, including the appellant, were made redundant.

1. As a result of the reduction in the number of rounds, the remaining rounds were reorganised, and the workload on the round serviced by the applicant was increased. The respondent's supervisors doubted whether the applicant would be able to manage the increased workload and that was a factor in his selection for redundancy.

1. In March 1994 the respondent's representatives met with representatives of the Transport Workers Union and discussed the need for redundancies and the basis on which the redundancies would occur.

1. In April, 1994 the respondent drew up a draft redundancy agreement and sent it to the Union.

1. The draft agreement provides for payment of a maximum of 26 weeks redundancy entitlement, and for the employer to nominate those workers who were to be made redundant. Mr. Scott for the respondent was told by Mr. Waddell for the Union at the end of April that the agreement was satisfactory.

1. The agreement was not signed by either party.

1. The Union did not inform its members at the Bakery of the terms of the negotiations.

1. The respondent did not inform the employees of the terms of the negotiations.

1. The respondent selected some employees as those to be made redundant, including the applicant.

1. On 13 May, 1994 the respondent informed the applicant that he was to be made redundant. The applicant tape recorded the meeting. The recording was not in evidence.

1. The applicant did not accept the redundancy. He went to work for another week and during that week his termination and redundancy payments were banked to his account. On 20 May he was told he was "finished" and he replied to the effect that he would take the matter to Court.

1. There is no evidence before the Court to challenge the process of selection for the redundancies.

There is conflict between the evidence of Mr. Burton for the Union and Mr. Milligan and Mr. Scott for the respondent as to whether or not the offers of redundancy were to be voluntary, or whether the respondent could select those employees who were to be made redundant. Mr. Burton denies that it was agreed that the Company could choose which drivers would go, and says that his understanding was that if the selected drivers did not agree to the offer, then volunteers would have to be called for.He also agrees that if the selected drivers did not accept the offer,then he would meet with them to discuss the possibility of disciplinary action if they could not perform the job. He did have a conversation with the respondent along those lines. The respondent's witnesses say that when the negotiations commenced the respondent was offering 13 weeks maximum redundancy pay, and later increased that offer to 26 weeks, because the Union agreed to allow the Company the right to choose which drivers would go.

The Court finds that the evidence of the respondent's witnesses as to the agreement reached is reflected in the facts. The draft agreement embodies the respondent's understanding of the oral agreement and its terms were not challenged when it was submitted to the Union. The Union took no part in the selection of those workers who were to be made redundant, nor did it seek to do so. Mr. Burton was shown a list in March and the names on it were discussed, but he did not retain a copy of the list. Mr. Burton agrees that the Company was to choose which workers were to be offered the package and that he was to become involved only if any of them objected. The Court finds that it is more likely that such involvement was to be for the purpose of persuading those workers to accept the offers, rather than for the purpose of having other workers volunteer to take the redundancy package. If the parties had agreed to voluntary redundancies,it would have been more likely that the process would be reversed, with all employees being notified of the terms of the package and volunteers being called for, before the Company made offers to selected workers.

The Union took on the role of negotiator on behalf of the workers and Mr. Wickham, as a member of the Union, empowered it to do so on his behalf. The evidence of Mr. Burton that no agreement was reached is inconsistent with the facts. The Union did not follow up the submission of the draft agreement, either by disputing its terms, or signing it. Nor did the respondent, which chose instead to act without further consultation with the Union after Mr. Scott was told by Mr. Waddell that its terms were acceptable, at the end of April.

The applicant told the Court that he had no notice of the purpose of the meeting on 13 May, but he did take a tape recorder to the meeting, suggesting that he knew that matters of significance would be discussed, and that he may have known the purpose of the meeting. The failure of the Union to inform Mr. Wickham, or any of the workforce of the impending redundancies and the progress of the negotiations it had undertaken on their behalf is unsatisfactory. Equally, the respondent failed in its obligations to its employees to inform them in a fair manner of the impending redundancies and the reasons for them. Had both parties to the negotiations properly considered the interests of the employees then these proceedings would probably never have been commenced.

All of that is of little comfort to Mr. Wickham. Whilst the Court understands his reasons for making this application, the application must fail. The respondent has satisfied the Court that it had a valid reason for redundancies based on its operational  requirements, and that the termination was not harsh, unjust or unreasonable in all the circumstances. The applicant received a generous payment on termination, which equates the maximum which the Court could have awarded by way of compensation had his application been successful.

The order will be that the application be dismissed.

Judicial Registrar:
Date: 3 January, 1995

Appearances:

For the Applicant -      Ms. V. Ponnuthurai
  Transport Workers Union

For the Respondent - Mallesons Stephen Jacques