Catering Industries NSW Pty Ltd v Elizabeth Van Setten
[2023] FWC 1542
•29 JUNE 2023
| [2023] FWC 1542 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.120—Redundancy pay
Catering Industries NSW Pty Ltd
v
Elizabeth Van Setten
(C2023/2637)
| DEPUTY PRESIDENT DEAN | CANBERRA, 29 JUNE 2023 |
Variation of redundancy pay.
Catering Industries NSW Pty Ltd (Applicant) has made an application pursuant to s.120 of the Fair Work Act 2009 seeking an order to vary the redundancy pay entitlement with respect to its former employee, Ms Elizabeth Van Setten. The Applicant seeks to reduce the amount of redundancy pay Ms Van Setten is otherwise entitled to be paid to zero, on the basis that it had obtained ‘other acceptable employment’ for her within its own business for the purposes of s.120(1)(b)(i) but such offer was rejected.
Ms Van Setten opposes the application and asserts that the position offered was not acceptable employment.
The matter was heard by telephone on 27 June 2023. Mr Sam Gillani (National Human Resources Manager) appeared for the Applicant and Ms Van Setten appeared on her own behalf. Both Mr Gillani and Ms Van Setten gave oral and written submissions in support of their respective case.
Relevant legislative provisions
Section 119 of the Act relevantly provides as follows:
119 Redundancy pay
Entitlement to redundancy pay
(1) An employee is entitled to be paid redundancy pay by the employer if the employee’s employment is terminated:
(a) at the employer’s initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or
(b) because of the insolvency or bankruptcy of the employer.
Section 119 goes on to provide the amount of redundancy pay by reference to the employee’s period of continuous service with the employer.
Section 120 of the Act provides:
120 Variation of redundancy pay for other employment or incapacity to pay
(1)This section applies if:
(a)an employee is entitled to be paid an amount of redundancy pay by the employer because of section 119; and
(b) the employer:
(i) obtains other acceptable employment for the employee; or
(ii) cannot pay the amount.
(2)On application by the employer, FWC may determine that the amount of redundancy pay is reduced to a specified amount (which may be nil) that FWC considers appropriate.
(3)The amount of redundancy pay to which the employee is entitled under section 119 is the reduced amount specified in the determination.
Background
The Applicant is a nationwide provider of hospitality, cleaning and laundry services predominantly in the residential aged care sector.
Ms Van Setten commenced employment with the Applicant in September 2018. She initially worked as a part time Cook at Ozanam Apartments Aged Care. In October 2018 she relocated to Warrigal Aged Care and had since been employed as a part time catering assistant. Her hours of work were Tuesday, Thursday, Friday, Saturday and Sunday between 7:30am and 12:30pm.
On 23 March 2023 the Applicant advised all its employees employed at Warrigal Aged Care that it had lost the contract to provide services at Warrigal and as a result would cease operations at that site on 10 May 2023.
On 5 May 2023 Ms Van Setten was offered a part time role as a cook at Mountainview Aged Care to be worked on a roster Friday to Sunday with a total of 33 hours per fortnight.
Ms Van Setten rejected the offer and in her response explained that it was because “the hours fall outside of my availability and family commitments which has been made known to Catering Industries management past and presence since the day I was first employed with catering industries”.
Ms Van Setten’s employment was covered by the Hospitality Industry (General) Award (the Award). Clause 42 of the Award provides that redundancy pay is in accordance with the NES. Ms Van Setten was employed for just under five years and is therefore entitled to 8 weeks redundancy pay.
The Applicant seeks to reduce the redundancy pay to zero.
Evidence and submissions
The Applicant
Mr Gillani gave evidence that after Ms Van Setten advised on 8 May 2023 that she did not accept the offer of alternative employment citing the hours were not suitable, he sent an email on 9 May 2023 requesting her to provide her availability for work. Ms Van Setten did not respond to his 9 May email.
Mr Gillani submitted that the Applicant has fulfilled its obligations under s.120 in that it consulted with Ms Van Setten and had made an offer suitable alternative employment. Mr Gillani referred to a number of authorities dealing with the term ‘acceptable alternative employment’ which support the view that it should be determined on an objective basis and that it is not necessarily identical employment.
He highlighted the following matters in relation to the role offered to Ms Van Setten which he claimed satisfied the key considerations:
a.The rate of pay on offer was identical, being $26.31 per hour.
b.The hours of work for the role offered were 33 hours per fortnight whereas her hours at Warrigal were at an average of 25 hours per fortnight.
c.She would have remained a permanent employee of the Applicant and maintained continuity of service and job security.
d.She possesses skills, experience and qualifications to perform the alternative role.
e.The Mountainview Aged Care site is located in the same suburb where she resides, resulting in significant reduction of travel time.
f.She would have continued to receive weekend penalties for work performed on Saturdays and Sundays.
It was submitted that the Applicant had exhausted all options to retain Ms Van Setten’s employment, that she unreasonably rejected offers of acceptable alternative employment.
Ms Van Setten
Ms Van Setten stated that she worked five days a week 7:30 am to 12:30 pm, including weekends. She said she had made it clear to all of the Applicant’s catering managers that she was unable to work past 12:30pm as she had to take over the care of her elderly mother shortly thereafter.
In her oral evidence, Ms Van Setten reiterated that the catering managers were aware of her caring responsibilities and as a result she considered the offer to be unacceptable.
Consideration
There is no dispute that Ms Van Setten’s former position was made redundant and that she is entitled to a redundancy payment by virtue of s.119, which is 8 weeks in this case. There is also no dispute that the Applicant made alternative employment offer to Ms Van Setten which she rejected. The Applicant does not claim any incapacity to pay.
Accordingly, the issue to be determined is whether the ‘other employment’ offered to Ms Van Setten was ‘acceptable’ within the meaning of s.120(1)(b)(i). If I am satisfied that the employment offered to Ms Setten was acceptable, I will then proceed to consider whether to reduce the redundancy payment.
Acceptable alternative employment
It is well established that the question of whether the position offered was acceptable alternative employment must be determined objectively and that the mere rejection of the alternative employment does not make it objectively unacceptable.
The Full Bench in Australian Chamber of Manufacturers v Derole Nominees Pty Ltd[1] (Derole Nominees) considered what constitutes ‘acceptable alternative employment’ and held:
“What constitutes ‘acceptable alternative employment’ is a matter to be determined, as we have said, on an objective basis. Alternative employment accepted by the employee (and its corollary, alternative employment acceptable to the employee) cannot be an appropriate application of the words because that meaning would give an employee an unreasonable and uncontrollable opportunity to reject the new employment in order to receive redundancy pay; the exemption provision would be without practical effect.
Yet, the use of the qualification ‘acceptable’ is a clear indication that it is not any employment which complies but that which meets the relevant standard. In our opinion there are obvious elements of such a standard including the work being of a like nature, the location being not unreasonably distant; the pay arrangements complying with award requirements. There will probably be others.”[2]
As put by Watson SDP in Feltex Australia Pty Ltd v Textile, Clothing and Footwear Union of Australia[3]:
“[89] I accept the proposition advanced by Feltex Australia that acceptable alternative employment is not necessarily identical employment and that the AIRC has previously found alternative employment to be acceptable notwithstanding inconvenience to employees and some detrimental alteration to the terms and conditions of employment.”
In a similar vein the Full Bench in Clothing and Allied Trade Union of Australia v Hot Tuna Pty Ltd[4] found that the determination of whether alternative employment is acceptable will involve a consideration of such matters as pay levels, hours of work, seniority, fringe benefits, workload and speed, job security and other matters including the location of the employment and travelling time.
In Sodexo Australia Pty Ltd T/A Sodexo[5], Deputy President Sams considered various authorities in respect of the question of what constitutes ‘other acceptable employment’ and helpfully summarised the principles in the following terms:
“• the test of what constitutes ‘acceptable employment’ is an objective one. It does not mean it must be acceptable to the employee.
·‘acceptable employment’ is not identical employment, as no two jobs could be exactly the same.
·an employee must meaningfully cooperate with the employer in exploring or considering options for alternative positions.
·an employee’s prima facie entitlement to redundancy pay may be at risk if the employee refuses a role or position, which is found to be objectively ‘acceptable’.
·the acceptance of alternative employment by one or more persons in a group of redundant employees does not necessarily make the alternative employment ‘acceptable’ for all of them. Each employee’s individual circumstances must be taken into account.
·There are a range of factors of varying weight, according to an employee’s particular circumstances, which may be taken into account to assess the acceptability of alternative employment.”[6]
Having considered all the relevant factors objectively I am satisfied and find that the Applicant had obtained other acceptable employment for Ms Van Setten within the meaning of s.120(1)(b)(i).
I accept the position at Mountainview Aged Care was objectively an offer of acceptable alternative employment, in that:
a.The role of part time cook was identical;
b.The hourly rate of pay was identical;
c.The hours of work for the role offered were 33 hours per fortnight whereas her hours at Warrigal were at an average of 25 hours per fortnight;
d.The site at which she was offered employment is in the same suburb where she resides, considerably shortening her travel time; and
e.She would continue to receive weekend penalties and maintain her continuity of employment.
Given this finding, the final issue is whether there should be a reduction in the amount of the redundancy payment. As outlined earlier, this is a matter of discretion which is to be exercised having regard to all of the relevant circumstances of the particular matter.
In this case, I consider there should be some reduction but not a reduction to zero as sought by the Applicant. This is because while the offer was an offer of acceptable alternative employment, I accept that Ms Van Setten had carer responsibilities which would have required adjustments to fit her new work roster.
Conclusion
Having come to the conclusion that the Applicant had obtained other acceptable employment for Ms Van Setten, I determine that it is appropriate in all the circumstances to reduce the amount of redundancy pay to an entitlement of four (4) weeks’ pay.
An order giving effect to this decision will be issued accordingly.
DEPUTY PRESIDENT
Appearances:
S Gillani for Catering Industries NSW Pty Ltd.
E Van Setten on her own behalf.
Hearing details:
2023.
By video:
June 27.
[1] (1990) 140 IR 128.
[2] Ibid at 128.
[3] PR974699.
[4] (1988) 27 IR 226.
[5] [2016] FWC 4012.
[6] Ibid at [127].
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