Brickland v Curtin Student Guild Ashdown v Curtin Student Guild Armstrong v Curtin Student Guild

[1995] IRCA 244

CATCHWORDS

INDUSTRIAL LAW - Termination of employment - claim for unlawful termination - redundancy - whether valid reason for termination - appropriate procedures on a redundancy.

INDUSTRIAL RELATIONS ACT 1988, Ss 170 EA, 170CA(1)
INDUSTRIAL RELATIONS ACT 1988, “Schedule 11”

Needham v Shepperton Preserving Co. Ltd. (1991) 1 AILR 395

BRICKLAND v CURTIN STUDENT GUILD WI 355 of 1994

ASHDOWN v CURTIN STUDENT GUILD WI 357 of 1994

ARMSTRONG v CURTIN STUDENT GUILD WI 358 of 1994

BEFORE:  WHEELER JR

PLACE:     PERTH

DATE:      10 APRIL 1995

IN THE INDUSTRIAL RELATIONS )
COURT OF AUSTRALIA               )
WESTERN AUSTRALIA               )
DISTRICT REGISTRY                   ) WI Nos. 355, 357 and 358 of 1994

BETWEEN:  LISA JACQUELINE BRICKLAND
  RICK ASHDOWN
  CAROL SUZANNE ARMSTRONG

- Applicants

AND  CURTIN STUDENT GUILD

- Respondent

MINUTE OF ORDERS

BEFORE:  WHEELER JR

PLACE:     PERTH

DATE:      10 APRIL 1995

THE COURT ORDERS THAT:

1. There be a declaration that the termination of employment of each of the applicants contravened Division 3 of part VIA of the Industrial Relations Act 1988.

2.  The respondent pay compensation to each of the applicants in the sum of $500.

NOTE:       Settlement and entry of orders is dealt with by Order 36 of the   Industrial Relations Court Rules.
IN THE INDUSTRIAL RELATIONS )
COURT OF AUSTRALIA               )
WESTERN AUSTRALIA               )
DISTRICT REGISTRY                   ) WI Nos. 355, 357 and 358 of 1994

BETWEEN:  LISA JACQUELINE BRICKLAND
  RICK ASHDOWN
  CAROL SUZANNE ARMSTRONG

- Applicants

AND  CURTIN STUDENT GUILD

- Respondent

EX TEMPORE REASONS FOR DECISION

These three matters were heard together.  The background of the facts briefly is that in 1993 all student Guilds faced the prospect of the introduction of what has been called “voluntary student unionism”.  At Curtin University the Guild established a Review Committee to oversee a dramatic restructure of the Guild which was seen as necessary to cope with the anticipated loss of revenue stemming from voluntary student unionism, being an amount of some $2 million out of a budget of something over $3 million.  Breaking even or making a profit where possible became an aim of what had previously been largely a service oriented organisation.

At other universities, other Guilds apparently saw less need for immediate action.  There was some prospect of funding from the federal government although I note that, although guidelines are apparently available now for seeking such funding, no money has yet been received by the Curtin Guild from that source.

In any event during 1993 the Curtin Guild, having taken the view that action at an early stage was necessary, restructured the Guild resulting in 11 redundancies out of a staff of some 25 full-time employees.

In April 1994, Mr Ioppolo, the general manager of the Guild, made available to staff a document called the “Stage 1 Paper” proposing a new management structure which involved, broadly, more professional management with the student representatives taking on a representative rather than as previously a managerial role. He also asked staff for their comments on the possible restructure of their own areas.  These comments and a document called the “Stage 1A” document which was prepared by Mr

Ioppolo, detailed suggestions as to what services could be considered viable and what could be considered non-viable.  They went to the Guild Review Committee which determined as a result of consideration of those documents and other factors that the applicants in these three actions should be redundant.

Ms Brickland had previously been the activities officer.  Mr Ashdown had been the recreation officer.  The duties of their positions were in part reduced, some were abolished, some were transferred to the new position of recreation manager, which position was given additional new managerial duties also.  Ms Armstrong had been the front office manager.  Part of the duties of her position were split among a number of existing areas, some were abolished and some  were transferred to the new position of retail manager which again had a broader management role.  Another Guild staff member, the previous second-hand bookshop manager, was promoted to the position of retail manager.

Against that background it was submitted on behalf of the applicants that there were five bases for the application.  The first was that there had been no exhausting of the potential funding arrangements; the second was that there was no genuine redundancy in the sense that the duties of the positions were still being carried out; the third was that there had been no consultation; the lack of which breached, among other things, the rules of the Guild and the contract of employment; the fourth was that there was an offer to renegotiate positions; and the fifth was that the three applicants had not received the enhanced redundancy package which had been made available to previous officers.  The fifth ground, it appeared, was based on a misapprehension of the packages in fact made available and was abandoned at trial.

I deal with those remaining in turn.  As to the submission that there had been no exhausting of potential funding arrangements, in my view such a submission against the factual basis established in this case is unrealistic.  Even if there had been no funding difficulties in any event, my view is that it was always open to the respondent to decide as a matter of policy that it would break even or would indeed aim to make a profit in order to reduce the fees being charged.  The fact that there was some external necessity governing the decision makes it even more unrealistic to submit that such a restructure could not have been undertaken.  The evidence of Mr Ioppolo was that his belief was that those Guilds which had not taken early action as at Mr Curtin were presently facing much greater difficulties as a result.

As to the second basis of the submissions, in my view the question is not whether there was a genuine redundancy.  The question is whether there was a valid reason for the termination of employment which is not quite the same thing.  In any event the description of redundancy which was adopted in Needham v Shepperton Preserving Company Limited (1991) 1 AILR at page 395 is apt to fit the circumstances of this case.  It was said in that case that:

It is not necessary for all of the work to have disappeared. Organisational restructuring may result in a position being abolished and the functions, or some of them, being given to another or split amongst others.

That appears, from my understanding of what happened to these positions, to be what happened in this case.

The third and fourth bases of the application go together.  There had been general consultation about restructuring.  The applicants were clearly aware that there was some risk to their employment but on my view of the evidence they were never clearly told of the new structure proposed and that their particular jobs, as a result, were under threat and of what structure would replace the existing structure.

They were considered for the new positions but were not invited to apply or to put forward submissions as to why they were suitable for the new positions at any time prior to their redundancy.  They were not, in the end, redeployed to those positions.   Ms Armstrong was not able to apply for the position of retail manager because another was appointed to that position.  Ms Brickland and Mr Ashdown were merely invited to apply for the position of recreation officer an invitation which I find was issued orally at the time at which they were told they were dismissed and at a time when one would hardly expect them to be in a position to either pay full attention to that offer or to take it very seriously.  Further, Ms Brickland was embarking on maternity leave at the time and there was no suggestion that any taking up of duties of a new position could be deferred or any arrangements made to accommodate that maternity leave.  Mr Ashdown was aware that he would require some retraining, or some additional training, in order to carry out the duties of the new position and none was offered to him.

The recommendation as to the appropriate procedures on a redundancy, the Recommendation Concerning Termination of Employment at the Initiative of the Employer set out at schedule 11 to the Industrial Relations Act, sets out a number of requirements in relation to situations of redundancy. These include: that there be meaningful dialogue with the affected employee; that such measures are taken as can possibly be taken to avert or minimise the terminations; and that alternative employment opportunities be investigated including training or retraining.

While the provisions of the recommendation are not of themselves of legislative force, the Act directs attention to the provisions of the Convention for the purpose of interpretation. Section 170CA (1) provides that the object of Division 3, part VIA of the Act is to give effect, or give further effect to, firstly, the Termination of Employment Convention, and secondly, the Termination of Employment Recommendation 1982. It is therefore appropriate for the purposes of determining whether the procedures adopted by the respondent resulted in the terminations being harsh, unjust or unreasonable to have regard to those matters which are set out in the Convention and the Recommendation. There need not of course be strict compliance with the Recommendation but the question of whether or not there has been an appropriate level of fairness will be determined having regard to the particular circumstances of the case in the light of the provisions of the Recommendation.

Further, in this case the Guild regulations provide for consultation with employees before termination.  Particular reference was made to the present schedule 3 headed: Employment of Staff, and to item 2 (4) of that schedule.  I am inclined to the view that the provisions of that schedule are intended to cover all terminations including those arising out of redundancy.  There is no rational basis for supposing that an employee to be made redundant is entitled to less consideration than one to be dismissed for misconduct, and although the headings of the times in that schedule tend to suggest that it is directed to questions of performance and misconduct, in the body of the schedule are provisions which are clearly directed to retrenchment alone.  In any event the relevant Guild minutes make it reasonably plain that substantial consultation was always intended.

On balance I am of the view that in particular circumstances of this case the consultation with the affected employees was not adequate and was so inadequate as to be harsh, unjust and unreasonable. I take into account particularly the small size of the work-force, the fact that some of the duties of each of the applicants’ positions were to continue and that it was recognised by the respondent that it was appropriate to consider the applicants for the new positions, but that none were invited prior to the termination of their employment to put a case for redeployment to those positions. I make a declaration in each case that the termination of employment of each of the applicants contravened Division 3 of part VIA of the Industrial Relations Act 1988.

Turning to the question of compensation, two factors are particularly relevant. One is that there was a very generous redundancy package arrived at for each of the applicants including a period of 10 to 14 weeks redundancy payment in each case, depending on individual circumstances.  Secondly, it is clear from the facts of this case that whatever the consolation, not all of the applicants could have been retained in their employment.  What has been lost by each of them is not a secure position but a chance of continuing in employment in a work-force which was to be dramatically reduced in size.  It is appropriate therefore to award nominal compensation only and in each case I order that the respondent pay to each of the applicants the sum of $500.

I certify that this and the preceding five pages are a true copy of the Reasons for Judgment of Judicial Registrar Wheeler.

Associate:

Date:

Representative for Applicant:                  Ms D Whitaker of the Community &   Public Sector Union

Counsel for Respondent:  Mr J Kennedy
Solicitors for respondent:  Minter Ellison Northmore Hale

Hearing Date:  6 & 7 April 1995
Judgment Dates:  10 April 1995