Chehan Senasekera v First Choice Business Brokers Pty Ltd T/A First Choice Business Brokers

[2020] FWC 4312

[2020] FWC 4312

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Chehan Senasekera
v
First Choice Business Brokers Pty Ltd T/A First Choice Business Brokers
(U2020/5924)

DEPUTY PRESIDENT HAMILTON MELBOURNE, 17 AUGUST 2020

Application for unfair dismissal remedy – jurisdiction: genuine redundancy.

[1] On 30 April 2020, Mr Chehan Lasika Senasekera (Applicant) lodged an application for an unfair dismissal remedy under section 394 of the Fair Work Act 2009 (Cth) (the Act). The applicant was made redundant on 15 April 2020. The applicant seeks a remedy totalling $376,830.22 mainly because of alleged breach of contract to pay commissions and alleged underpayments, although the Commission does not have the power to enforce contracts.

[2] On its face this seems to be having heard all the evidence and submissions a relatively straightforward matter. However, given the applicant’s submissions and refusal to make concessions of nearly any kind in the face of overwhelming evidence, I decided to address a range of matters in some detail.

[3] First Choice Business Brokers Pty Ltd trading as First Choice Business Brokers (respondent) objects to the application on the basis that the applicant’s employment came to an end by way of a genuine redundancy.

[4] I convened a Mention/Directions Hearing on 20 July 2020. I proposed that the matter be conducted by way of determinative conference pursuant to section 399 of the Act. No party objections were made, and it was agreed. A further determinative conference was held on 22 July 2020.

[5] I also explained to the applicant with respect to the remedy sought that this was an unfair dismissal application, and I was not able to enforce contractual terms or underpayments. I explained the statutory limit of 6 months remuneration that may be awarded in this jurisdiction under s.392(6) of the Act, which may be only a small fraction of the $376,830.22 that he sought. The applicant appeared to understand this, although the proceedings were difficult, and the applicant’s complaints about allegedly unpaid commissions were the focus of his written submissions. Overall these were somewhat puzzling proceedings.

[6] Ms Franceska Leoncio, counsel, was granted permission to appear for the respondent pursuant to s.596 of the Act, instructed by Mr Niksa Stanisic, solicitor, given the complexity of the proceedings, including the award provisions relating to commissions. Their assistance was invaluable in dealing with these complexities, and they acted as a ‘friend of the court’ in bringing relevant matters to the attention of the Commission. This was a somewhat burdensome role. The applicant appeared on his own behalf.

[7] The following witnesses gave sworn evidence:

•  Mr Chehan Lasika Senaseker; and

•  Mr Kevin Lee.

[8] I have had regard to all submissions and evidence.

[9] It appears that the applicant is also pursuing a claim for unpaid entitlements in another jurisdiction, and there may be other proceedings. For the purposes of clarity for the applicant, this decision is a separate matter, and the other matter will be determined on its merits regardless of the outcome of these proceedings. I am unable to predict the outcome of such separate proceedings.

The Act

[10] The Act provides as follows:

389 - Meaning of genuine redundancy

(1) A person's dismissal was a case of genuine redundancy if:

(a) the person's employer no longer required the person's job to be performed by anyone because of changes in the operational requirements of the employer's enterprise; and

(b) the employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.

(2) A person's dismissal was not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within:

(a) the employer's enterprise; or

(b) the enterprise of an associated entity of the employer.

Consideration

[11] I note firstly that the applicant advised me that the ‘Applicant’s Outline of Submissions Merits and Reply’ submission and materials filed on 21 July 2020 constitute a summary of his submissions and contentions, with the addition of an additional point to the effect that the employer received Jobseeker payments for him, and therefore that this is not a genuine redundancy. 1

[12] I note that no attempt is made in this submission to address a key issue, perhaps the key issue, which is that the respondent’s business has been adversely affected by the COVID-19 crisis in terms of sales and business performance, and staff reductions have accordingly been made through voluntary leaving or redundancy. There is virtually nothing in the applicant’s submissions to lead me to doubt the employer claim in its letter to the application of 9 April 2020 2 to the effect that:

“Due to the COVID-19 crisis, the business currently has no significant sales prospects and no listings in the pipeline, with none expected in the foreseeable future. As a result, First Choice is experiencing cash flow problems.

We cannot forecast when the COVID-19 crisis will be over, or when we can expect business to pick up. In the circumstances we expect the situation to continue until well into November – December 2020, at which time we hope that we will see some improvement in the pipeline and revenue start to come through.

With no revenue for such an extended period, First Choice is considering measures to ensure the company’s ongoing viability during this challenging period. Included in these measures is an attempt to reduce the amount we are currently paying in rent on our premises and a reduction in staff numbers by redundancy.”

[13] The applicant had the opportunity to respond to this claim and did so at length on 14 April 2020 in responding to the 9 April employer redundancy proposal, in his 400 page initial submission in these proceedings, and in his final written submission. He hardly addressed these claims at all in these written submissions, and in his oral submissions. To a large extent the essential claims of the employer must therefore be accepted. Further, it appears that the applicant was not the only one affected. The employer submitted without contradiction 3 that three other employees voluntarily left, thus making redundancies unnecessary:

“7. The Respondent considered making other positions redundant around this time, however it did not proceed with those redundancies as the following employees voluntarily left their employment with the Respondent during the COVID-19 related shut down period (between 30 March 2020 to 26 April 2020):

(a) Andrew Ho (Agent);

(b) Nicolas Storrie (Admin); and

(c) Stephen Li (Casual Telemarketer).”

Job no longer performed by anyone – s.389(1)(a)

[14] Nevertheless, for the sake of completeness, I have dealt with the applicant’s submissions below. In this matter, the employer in their written submissions submit that: 4

“No longer required the job to be performed by anyone because of changes in operational requirements

Duties remained

1. The Applicant submits that someone needed to manage his listings and that these listings would generate significant commission for First Choice.1 2. For the purposes of s 389(1)(a) of the Fair Work Act 2009 (Cth) (the Act) it is the employee’s “job” that is no longer required to be performed, rather than the employee’s “duties”.

2. That there was a continued need for listing and sales duties to be performed by other agent’s representatives is not to the point. There was an overall reduction of business which reduced the total number of agent’s representatives required such that the Applicant’s job no longer existed.

[15] In relation to these submissions, the applicant appeared to submit that a reduction in sales was not of importance, and that I should look to the listings instead. This was an odd submission, and which is at the heart of the difficulties with the applicant’s case. The employer of a commission only employee is still liable to pay a minimum amount of 125 per cent of the annualised minimum wage under the Real Estate Industry Award 2010, and does not escape award liability by placing an employee on a commission only agreement 5:

“16.7 Commission-only employment

…

(b) Objective of commission-only employment

The objective of commission-only employment arrangements is to provide a mechanism by which a salesperson who meets the requirements set out below should achieve remuneration of 125% or more of the annualised minimum wage that an employee working at the same property sales level under this award would be entitled to be paid.

…

(d) Minimum income threshold amount (MITA)

(i) For the purpose of entering into commission-only employment, the MITA has been achieved if the employee can establish that in any consecutive 12-month period in the 3 years immediately preceding entering into the commission-only agreement, the employee received annual remuneration (including any commission or bonus payments) at least equal to 125% of the employee’s classification rate as specified in clause 14—Minimum rates, calculated as an annual amount, excluding statutory superannuation.” [underlining added]

[16] If the applicant was submitting that the commission only basis of his employment means that I should look to listings not sales, this is not correct. The employer must earn income to pay award rates, just as an ordinary business does.

[17] I therefore must look to sales. I questioned the applicant as to whether the COVID-19 crisis had an impact on sales. The applicant was somewhat reluctant to concede that sales had dropped because of the current crisis, when he should have given candid and forthright evidence if he wished his evidence to be accepted. When pressed he responded somewhat reluctantly by saying that it could affect sales to a certain level. 6 Even on the applicant’s own version of events, there is a reduction in sales then which can lead to redundancies. I later asked the applicant whether there was a reduction in work and the applicant responded by saying that there was not an overall reduction in work as the listings were always present.7 The respondent in response to this explained that there was a dramatic downturn and as the business conducted by the respondent is in the realm of business brokering it was placed in a particularly vulnerable position to the effects of COVID-19 and resultant economic downturn.8 The applicant stated that it is not a case of the business generating income and paying a wage or salary to him, rather he is a pieceworker where he generates income for the business, therefore this type of payment arrangement does not affect the business.9 The respondent stated that the applicant would still need to receive the minimum income threshold amount and that there is still a liability on the business to pay certain amounts to the applicant regardless of whether commission is generated.10 This is correct given the provisions in the award, which require that an employee receive a guaranteed minimum income even if working under a commission agreement.

[18] On the material before me the respondent’s business is clearly affected to a substantial degree by the COVID-19 crisis, which was hardly challenged during the proceedings. It is an unwelcome reality which should have been apparent to all sides, and candid evidence should have been given about it. Clearly matters of profit and loss are relevant to any business, because they determine for example if the business becomes insolvent, or makes a profit and is able to continue, and a reduction in sales is a reduction in income for the business which can have a serious effect on the viability of the business. The reduction in sales is relevant, and I accept the evidence of Mr Lee that there was a reduction in sales, and that this is relevant. I also agree with the decision in UES (Int’l) Pty Ltd v Harvey, 11 in which the Commission said that the process for selecting individual employees for redundancy is not relevant to whether a dismissal was a case of genuine redundancy.

[19] Consistent with the generally argumentative nature of the proceedings, there was also a continuing dispute about the number of listings. A revised list was provided by each side, and in his supplementary submission the applicant claimed that he had over $5 million worth of listings. 12 The respondent clarified the listings of the applicant in attachment KL-17, with some relatively minor amendments.

[20] Mr.Lee gave evidence in his supplementary witness statement 13 that:

“6. In relation to the proposed sale of the Kismat Handy Car Wash Pty Ltd which is referred to at paragraph 19 of the Senasekera Statement and Annexure CS-62:

(a) an offer to purchase Kismat Handy Car Wash Pty Ltd was made on 11 March 2020. However, the purchaser did not pay a deposit at the time of making the offer to purchase. The purchaser has not since made a deposit.

(b) at the time that Mr Senasekera’s role was made redundant, I considered that it was unlikely the sale would be completed because the buyer had not paid a deposit and therefore did not seem genuine.

(c) after Mr Senasekera’s employment was terminated, the sale was relocated to the listing agent who originally listed this business for sale in accordance with First Choice’s standard practice.

(d) the settlement scheduled for 15 May 2020 did not proceed. There still remains no signed contract of sale, no paid deposit and no rescheduled settlement date. First Choice is not confident that commission will be generated from this listing.

7. In relation to the listings referred to at paragraph 39 of the Senasekera Statement and Annexure CS-67:

(a) as at 15 April 2020, Mr Senasekera had 29 listings, however his authority for 27 of those listings had been expired for more than 5 months and the remaining 2 listings were withdrawn from the market. Attached and marked “KL-17” is a list of Mr Senasekera’s listings as at 15 April 2020.

(b) the list at Annexure KL-17 contains all of the listings in Annexure CS-67, except for three (ref 16926, ref 13827 and ref 11636) which were listed by other agent’s representatives/business brokers.

(c) none of the businesses in Annexure KL-17 have since sold. These listings are of little value to First Choice for the reasons set out below.

(d) the listing authorities for each of the businesses listed at Annexure KL-17 have expired and most were expired by December 2019. Once the exclusive listing authority is expired, there is no guarantee that First Choice would receive commission from the sale of the business. For example, if the owner of the business has changed hands or the vendor has signed an exclusive authority with another agency.

(e) if the 27 listings sold at full price, the commission value would be $1,503,820. During COVID-19, it is unlikely that any of these businesses will be sold. If a sale can be achieved, it would likely be at a reduced price given the current recession, which would mean First Choice’s expected commission would also be reduced.”

[21] This was later corrected by the respondent to a value of 1.49 million. 14 I prefer the evidence of Mr Lee, given a number of difficulties with the applicant’s evidence, including the apparent assertion that sales do not matter, and that he did not claim that he specialised in aged care, and his apparent unwillingness to candidly give evidence about the effect of the downturn on the business or even arguably any other issue which might adversely affect his case. In giving oral submissions, the applicant denied that he ‘claimed to specialise in aged care’, even though in an email sent by him on 24 January 202015 he stated that ‘I specialise in Aged care.’ The applicant acknowledged that he wrote the statement, and that he was telling the truth at the time when he wrote it, but said that there was nothing in writing attesting to him specialising in aged care.16 I explained to the applicant that I had difficulty accepting his evidence as on the basis of his own material it was apparent that the applicant had stated that he specialised in aged care and therefore it was reasonable for the employer to say in their written submissions that the applicant claimed to have specialised in this area.17 I have had regard to the context of the email, and I accept the employer submission that he did claim to specialise in aged care. I prefer the evidence of Mr Lee. There were other difficulties with the applicant’s evidence, which were with respect somewhat self-justifying, and as such did not provide a proper foundation for evidentiary findings.

[22] The applicant also submitted in a supplementary submission that “Mr Senasekera’s job performed by someone else”. 18 The applicant also submits that another employee was not made redundant, Ms Mary Thi-Ha Li, and that the Consumer Affairs Agents representatives list provides that the respondent has 16 agent representatives, and that this means that “the reason for selecting the person is not logical or genuine”.19 In Ulan Coal Mines Limited v Henry Jon Howarth20 a Full Bench of the Commission said:

“[17] It is noted that the reference in the statutory expression is to a person’s “job” no longer being required to be performed. As Ryan J observed in Jones v Department of Energy and Minerals (1995) 60 IR 304 a job involves “a collection of functions, duties and responsibilities entrusted, as part of the scheme of the employees’ organisation, to a particular employee” (at p. 308). His Honour in that case considered a set of circumstances where an employer might rearrange the organisational structure by breaking up the collection of functions, duties and responsibilities attached to a single position and distributing them among the holders of other positions, including newly-created positions. In these circumstances, it was said that:

“What is critical for the purpose of identifying a redundancy is whether the holder of the former position has, after the re-organisation, any duties left to discharge. If there is no longer any function or duty to be performed by that person, his or her position becomes redundant…” (at p.308)

This does not mean that if any aspect of the employee’s duties is still to be performed by somebody, he or she cannot be redundant (see Dibb v Commissioner of Taxation (2004) FCR 388 at 404-405). The examples given in the Explanatory Memorandum illustrate circumstances where tasks and duties of a particular employee continue to be performed by other employees but nevertheless the “job” of that employee no longer exists.

[18] In Kekeris v A. Hartrodt Australia Pty Ltd [2010] FWA 674 Hamberger SDP considered whether a dismissal resulting from the restructure of a supervisory team was a case of genuine redundancy. As a result of the restructure, four supervisory team leader positions were replaced by three team leader positions. The Senior Deputy President said:

“When one looks at the specific duties performed by the applicant prior to her termination they have much in common with those of two of the new positions in the new structure. The test is not however whether the duties survive. Paragraph 1548 of the explanatory memorandum makes clear that it can still be a ‘genuine redundancy’ where the duties of a previous job persist but are redistributed to other positions. The test is whether the job previously performed by the applicant still exists.” (at par [27])

[19] In the present case, the Commissioner appears not to have drawn an appropriate distinction in his reasoning between the “jobs” of the mineworkers who were retrenched and the functions performed by those mineworkers or take proper account of the nature of the restructure at the mine which led to an overall reduction in the size of the non-trades mineworker workforce. The Company restructured its operations in various ways including by outsourcing certain specialised, ancillary and other work and increasing the proportion of trade-qualified mineworkers in underground development and outbye crews. As a result, it was identified that there were 14 non-trades mineworker positions which were surplus to the Company’s requirements. The mineworkers whose employment was to be terminated were determined according to the seniority principle as provided in the Agreement. This did not mean that the functions or duties previously performed by the retrenched mineworkers were no longer required to be performed. It also did not mean that the positions of some of these mineworkers (e.g. in underground crews) did not continue, although those positions might after the restructure be filled by more senior non-trades mineworkers transferred from other parts of the operations or by trade-qualified mineworkers. However fewer non-trades mineworker jobs were required overall at the mine as a result of the operational changes introduced and, for this reason, the jobs of the 14 mineworkers selected for retrenchment could be said to no longer exist.

[20] These circumstances readily fit within the ordinary meaning and customary usage of the expression in s.389(1)(a) of the Act where a job is no longer required to be performed by anyone because of changes in the operational requirements of the employer’s enterprise.”

[23] Applying those observations to the present matter, the work was reallocated, but this is consistent with the bundle of duties performed by the applicant no longer being done by anyone, similar in nature to the circumstances cited by the Full Bench, in that overall numbers of employees dropped through redundancy or voluntary separation, because of operational difficulties of the business caused by the COVID-19 crisis economic downturn. This sort of reallocation of work is common in redundancies, and is compatible with the job being redundant. The test is not whether or not the work was reallocated, but whether the job the employee was doing is redundant. The fact that someone else is not made redundant, does not mean that a redundancy is not genuine. The respondent chose who was to be made redundant, as it was entitled to do. Overall given the reduction in sales and other indicia the job was redundant.

[24] The employer went on to submit in their written submissions that: 21

“3. In any event, First Choice submits that Mr Senasekera has overstated the number and value of his listings.

4. The Applicant’s claim4 that he was managing over 50 listings worth over $5 million is incorrect. As at 15 April 2020, the Applicant had 27 listings worth approximately $1.5 million if sales could be completed at full price. In reality, these listings are of little value to First Choice.6 During COVID-19, it is unlikely that any of these sales will be achieved at full price or at all.7 To the extent any sales are made in the future, which appears extremely unlikely in the current climate, they would likely be at a reduced price and therefore would generate a much lower commission.”

[25] The applicant provided fresh evidence of his listings, as did Mr Lee. I prefer the evidence of Mr Lee, for reasons already given.

[26] The employer submitted that: 22

“5. In respect of Kismat Handy Car Wash Pty Ltd,9 First Choice formed the view that the purchaser was not a genuine buyer because the purchaser did not pay a deposit at the time of making the offer to purchase.10 The settlement on 15 May 2020 did not ultimately proceed and no deposit has since been paid.11 The settlement has not been rescheduled.12 In these circumstances, First Choice has little confidence that commission will be generated from this listing.”

[27] The applicant submitted that I should count the value of this sale. However, if the sale has not been executed, and a payment has not been made, as appears to be the case, this has not yet been realised, and it is difficult for me to predict what will happen in the future with this sale, although I was invited to do so. It is also difficult for me to have regard to it, or to give much weight to it as supporting the applicant’s case. Even if I do have regard to it, the effect of this evidence is limited.

[28] In relation to aged care sales, the respondent submitted: 23

“Aged care sales

6. The Applicant claims that his knowledge and skills were not limited to sales in the aged care sector and that business sales in the aged care sector had not been affected.’

7. The process for selection for redundancy is not relevant to the question of whether there was a genuine redundancy. In any event, the Applicant claimed to specialise in aged care and had previously demonstrated reluctance in pursuing businesses outside the aged care sector. It was therefore fair and reasonable for First Choice to select the Applicant for redundancy in circumstances where, inter alia, it no longer wished to pursue sales in the aged care sector.

8. Although aged care businesses were not shut down, First Choice formed the view that it would not be a viable or lucrative business proposition because the prospect of COVID-19 outbreaks and possible deaths had driven away buyer interest and this was expected to continue in the future. Further, inspections were prohibited, which would hamper sales activities. Further, there was a significant lag time between listing and settlement due to regulatory approvals, which was not attractive to First Choice given its immediate cash flow problems.”

[29] Mr.Lee gave evidence that: 24

“Aged care

8. In relation to Mr Senasekera’s claim that aged care had not been affected in business sales referred to at section 4(b) of the Senasekera Objections Outline, as stated at paragraph 32 of my First Statement, I considered that the aged care sector would not be a viable or lucrative business proposition. I formed this view based on the following:

(a) the potential for COVID-19 outbreaks in aged care residences and possible deaths had driven away buyer interest and this was expected to continue in the future; and

(b) as a result of COVID-19, there were strict visitor restrictions implemented from 18 March 2020, which prevented inspections from taking place.

9. In addition, sales of aged care businesses require approval from the Department of Health and Human Services, which can often take up to six months. Given our cash flow problems, we needed to focus on sales that could be completed quickly. I considered that the process for the sale of an aged care business would take too long before any commission would be generated.

10. In relation to Mr Senasekera selling businesses other than those in aged care referred to at paragraph 39 of the Senasekera Statement, Mr Senasekera had knowledge and skills to sell businesses in other areas but had previously shown little interest in doing this. As is shown in Annexure CS-41 First Choice had encouraged Mr Senasekera to generate more listings in other areas but he was reluctant to do so.’

[30] The applicant claimed in supplementary submissions in response to this that there was aged care work that was allocated to other brokers, and therefore that his selection for redundancy was not genuine. 25 The issue of selection for redundancy is dealt with above. The allocation of work to other brokers does not prevent a job being made redundant, having regard to the Full Bench decision in Ulan.

[31] In relation to commission only employees, the respondent submitted: 26

“Commission-only employees

9. The Applicant submits that “there is no such practical term as “redundancy” in “business brokering””. This submission has not been properly particularised and is refuted in any event. As stated in the letter to the Applicant on 30 March 2020, following the review of the Applicant’s payments between 3 April 2019 and 2 April 2020 it was found that his commission-only income did not meet the minimum income threshold amount prescribed by the Real Estate Industry Award 2010 (Award). The practical effect of this was that the commission-only arrangement would cease and he would be paid the minimum rate of pay under the Award. Therefore, the Applicant’s claim that a reduction in agent’s representatives “does not save money” and only reduces potential income is plainly incorrect.”

[32] The respondent later corrected this statement, as a commission had been found which brought the applicant over the minimum income threshold. 27The applicant rejected this employer submission, but his objection was somewhat unclear, and with respect he did not appear to understand the effect of the award. I accept the employer submission. I see no reason why redundancy laws do not apply to this form of employment, and this is consistent with for example Arnold v Real Estate Mt Hawthorn Pty Ltd T/A Oxford Property Group28, in which the Commission was satisfied that a redundancy as a result of the end of a commission-only arrangement under the Award in the context of a downturn in business satisfied s 389(1)(a) of the Act.

[33] In relation to JobKeeper, the respondent submitted: 29

“JobKeeper

11. The Applicant states that First Choice was receiving JobKeeper for other commission only employees starting from 30 March 2020.

12. First Choice registered its interest to participate in the JobKeeper scheme on 30 March 2020. As stated in the Respondent’s Submissions, it was not known whether or not First Choice would be eligible for the JobKeeper subsidy in respect of Mr Senasekera.23 Applications for enrolment did not open until 20 April 2020, which was after the termination of the Applicant’s employment. First Choice received the first JobKeeper payments, which included backpay from 30 March 2020 to 24 April 2020, on 15 May 2020. First Choice transferred the JobKeeper payments to each of the eligible employees.

13. In any event, regardless of the JobKeeper subsidy, the relevant test is whether the Applicant’s job no longer existed. Given the overall reduction in work, the Applicant’s role was surplus to requirements such that his job no longer existed.”

[34] The applicant rejected this employer submission and submitted that the respondent knew the status and application of JobKeeper to the applicant. His evidence was somewhat unclear, although at the end he appeared to claim that the employer received payments with respect to him, and I prefer the submissions and evidence of the respondent. In any event, in McClelland v. Kamori Australia Pty Ltd T/A Lone Pine Koala Sanctuary, 30 the Commission said:

“[72] In advancing his argument, Mr McClelland submitted that rather than terminating his employment, Lone Pine ought to have considered temporarily standing him down without pay, and subsequently done all thing necessary to facilitate him receiving the JobKeeper payment. Mr Friedler made clear the reason Lone Pine made the decision to make positions redundant was based on its view that it would be in the order of three years before Australia would be in a position to allow the return of significant numbers of international visitors on which Lone Pine so heavily relies.

[73] In any event, as I indicated in the course of the hearing, for the purposes of the jurisdictional objection the Commission is concerned with whether the job was still required because of changes the employer has decided to make, and not with whether the employer’s decision to make certain operational changes is a good or bad decision.”

[35] In relation to working from home, the respondent submitted: 31

“Agent’s representatives’ duties can be performed from any location

14. The Applicant submits that the agent’s representatives could continue to perform their duties during the office shut down. First Choice does not rely on the physical shutdown of its business premises in respect of its contention that there was a change in operational requirements. Rather, First Choice relies on the economic downturn caused by the COVID-19 pandemic which resulted in a dramatic downturn in First Choice’s business. That the agent’s representatives could work remotely is inconsequential. What is relevant is that the agent’s representatives had less work to perform due to the substantial reduction in listings and sales.”

[36] The applicant did not agree with this employer submission. However, I agree that the relevant test remains that the applicant had less work to perform due to the reduction in listings and sales. I reject the applicant’s submissions.

[37] In relation to alleged termination for proscribed reasons, the respondent submitted: 32

“Termination for alleged proscribed reasons

15. As stated in First Choice’s submissions, the Applicant’s employment was terminated because of a genuine redundancy and not because of, or in relation to, any alleged unpaid outstanding entitlements. The majority of the Applicant’s complaints about alleged outstanding entitlements were not made until 14 April 2020, after the Applicant’s role had already been selected for redundancy. These matters could not, therefore, have formed the basis of the decision to dismiss the Applicant.

16. A substantial proportion of the material filed by the Applicant goes to seeking to establish alleged commission payments and alleged underpayments under the NES and the Award, including post-employment letters of demand. As stated in the Respondent’s Submissions, the Commission is not empowered to make orders for compensation or otherwise for alleged breaches of the NES or the Award (or for breaches of contract). It is, therefore, submitted that these matters are not relevant to the present proceeding.

17. Further, to the extent the Applicant seeks to make separate claims for “intimidation”, “bullying” and “harassment, such matters are denied and are not relevant for the purposes of an application for an unfair dismissal remedy.”

[38] Mr.Lee gave evidence that: 33

“15. In relation to paragraph 11 of the Senasekera Statement, I strongly deny that First Choice, or I, have engaged in any intimidation, bullying or harassment or taken any action because of any claims made by Mr Senasekera.”

[39] The applicant disagreed with these submissions. In his supplementary submission 34 the applicant said that the termination was ‘illegal’ and breached the general protections prohibitions in the Act.

[40] However, as the respondent submitted, the selection for redundancy occurred before much of the dispute about entitlements occurred. I am unable on the evidence and submissions before me to find a link between the dispute over entitlements and the redundancy, and I accept Mr Lee’s evidence and the employer submissions on this issue and alleged bullying and intimidation. It is unfortunately often the case that such allegations are made in proceedings without a proper foundation for them being made out. It is not enough to assert in general terms that there has been a breach of general protections or bullying or similar conduct, as is often done in response to unwelcome employer actions such as discipline or termination. Rather a detailed case has to be made out, which was not done in this case.

Consultation – s.389(1)(b)

[41] With respect to section 389(1)(b) of the Act, the Real Estate Industry Award 2010 35 provides:

“26.1 If an employer makes a definite decision to make major changes in production, program, organisation, structure or technology that are likely to have significant effects on employees, the employer must:

(a) give notice of the changes to all employees who may be affected by them and their representatives (if any); and

(b) discuss with affected employees and their representatives (if any): i. the introduction of the changes; ii. their likely effect on employees; and iii. measures to avoid or reduce the adverse effects of the changes on employees; and (c) commence discussions as soon as practicable after a definite decision has been made.

26.2 For the purposes of the discussion under clause 26.1(b), the employer must give in writing to the affected employees and their representatives (if any) all relevant information about the changes including:

(a) their nature; and

(b) their expected effect on employees; and

(c) any other matters likely to affect employees.

26.3 Clause 26.2 does not require an employer to disclose any confidential information if its disclosure would be contrary to the employer’s interests.

26.4 The employer must promptly consider any matters raised by the employees or their representatives about the changes in the course of the discussion under clause 26.1(b).

“significant effects” is defined in clause 26.5 to include “termination of employment’.”

[42] As Mr Lee said in giving evidence: 36

“14. In relation to Mr Senasekera receiving the email dated 9 April 2020 while he was self-isolating referred to at paragraph 11 of page 14 of the Merits Outline:

(a) Mr Senasekera did not request any further time to enable him to provide a response”

[43] The respondent submitted in relation to this matter that:

“Consultation

18. It is unclear on what basis the Applicant considers that the consultation was not real or that he was “tricked”. By its email on 9 April 2020, First Choice clearly gave the Applicant an opportunity to engage in meaningful consultation and the Applicant took advantage of this opportunity by his detailed letter dated 14 April 2020, which was considered by First Choice.

19. There is no reasonable basis for the Applicant’s assumption that every other commission only employee was to be made redundant. In fact, in his email dated 14 April 2020 he stated that he was not aware if any other agent’s representatives had been made redundant.

20. The direction not to discuss the redundancy and not to perform work were reasonable in the circumstances. It can be reasonably inferred from the Applicant’s lengthy and detailed submission on 14 April 2020, that he was given a full opportunity to respond to the proposed redundancy. The Applicant’s self-isolation at the relevant time equally did not appear to have any impact on the Applicant’s ability to engage in consultation.”

[44] The applicant continued to claim that he had been ‘tricked’, but this claim was unclear in nature, and may have been part of his disagreement about entitlements. That is being dealt with in another jurisdiction.

[45] In fact, the respondent wrote to the applicant in the following terms on 9 April 2020, 37 indicating that it was considering making his position redundant with effect on 15 April 2020, and giving him an opportunity to comment on and discuss the changes, including the introduction of these changes, the likely effect on you, and the measures to avoid or reduce the adverse effects of the changes. The respondent also outlined the nature of the operational problems it was experiencing:

“Dear Chehan

Workplace changes – redundancy

As at the end of March 2020, First Choice Business Brokers’ revenue is down 76% as against this time last year, we are expecting to incur a significant loss for this financial year 2019–2020.

Due to the COVID-19 crisis, the business currently has no significant sales prospects and no listings in the pipeline, with none expected in the foreseeable future. As a result, First Choice is experiencing cash flow problems.

We cannot forecast when the COVID-19 crisis will be over, or when we can expect business to pick up. In the circumstances we expect the situation to continue until well into November – December 2020, at which time we hope that we will see some improvement in the pipeline and revenue start to come through.

With no revenue for such an extended period, First Choice is considering measures to ensure the company’s ongoing viability during this challenging period. Included in these measures is an attempt to reduce the amount we are currently paying in rent on our premises and a reduction in staff numbers by redundancy.

As part of this process, we are considering making your position redundant with effect on 15 April 2020.

First Choice would like to give you an opportunity to comment on and discuss the changes, including the introduction of these changes, the likely effect on you, and the measures to avoid or reduce the adverse effects of the changes.

We invite you to respond to these changes by email (because of social distancing requirements) no later than 9.30 pm on 14 April 2020. If we do not receive a response from you we may make our decision about the future of your employment without your input.

To help you respond to these matters, if your position is made redundant and you are not redeployed, you would be entitled to receive:

•  four weeks’ notice of termination or payment in lieu ($3,450.00 gross); and

•  11 weeks’ redundancy ($9,487.50 gross).

We have considered whether you can be redeployed within the company, but given the reasons for the proposed redundancy there are no redeployment opportunities available.

I appreciate that this situation may be difficult, but we want to be as upfront as possible about how to manage these changes. Once we have received your feedback, we will take that into account and endeavour to accommodate your suggestions.

I look forward to hearing from you with any feedback that you want to give.

In the meantime, you are directed to not disclose or discuss this letter or the consultation process with your colleagues as we do not wish to distress them unnecessarily. You are also directed to not attend the office, access our systems or otherwise perform any work in accordance with the current stand down situation.

Yours sincerely,

Kevin Lee
Director”

[46] The applicant took advantage of this offer of consultation, and did in fact respond at some length, in an email with six pages and over twenty pages of attachments on 14 April 2020. The email sought the provision of certain documents, and attempted to refute some of the respondent claims. The email provided:

“Dear Kevin,

Please find the attached documents with full Redundancy calculations and all outstanding payments due from 4/6/2013 to 15/04/2020. Also attached is copy of ‘Employer Separation Letter’.

•  Payments Due Calculations

•  Outstanding Payments Explanation & Other Issues

•  Long Service Leave Calculator

•  Employement Separation Certificate

Please provide me with following documents, arrange an office visit on 15/04/2020.

•  Employer Reference letter on First Choice Business Brokers letter head for the duration of my employment (4/6/2013 to 15/04/2020)

•  Employer Separation Certificate completed as of 15/04/2020 (attached)

•  Access to First Choice Business Brokers office as I have some personnel belongings in the office and some personal documents and photos saved in my computer.

•  Cheque written to my Redundancy payment as of 15/04/2020

•  Cheque or EFT payments made to all outstanding amount listed above on 15/04/2020 (please write separate cheque for reimbursements and taxable amounts) or within 7 days.

•  Final pay slips for redundancy payment and outstanding commission, entitlements, reimbursements (please note taxation is different to redundancy, normal pay, and compensation) with in 7 days of 15/04/2020

Employment Contract

As per your email redundancy notice on 9/4/2020 you have Redundant my position. Also you are unable to Redeploy me into another position.

•  Therefore, as of 15/04/2020 following clauses of the Employment Agreement shall no longer apply.

•  5.5 - Any unsettled business commission entitlement will apply according to Real Estate Industry Award act 2020.

•  7- This clause already illegal and against the REIV code of conduct and rules of practice. You redundant my position means ,this position no longer apply in your company. Therefore you have no right to restrain me contractually. I live within 6km from Box Hill. Reason I select my job in in 2013 is it was closer to my house. I already told you when I took the position, I wouldn’t agree to that clause as it seamed to be illegal and I asked to amend it and return the contract. You haven’t even returned me the executed copy of the contract until 21/1/2020. All my employment 9 years prior to this also within 6km radius. This is against social security law job seeker requirement. Past 7 years employment all my educational qualifications now irrelevant. Current Covid-19 situation has restrictions where people can travel from their home.

•  Duty Statement no longer apply.

•  Any other post employment conditions unreasonable or against the Federal or Victorian State Law

•  If REDUNDANCY NOTICE Full rights of Interpretation of all terms and conditions of Employment Agreement solely remains with employee Chehans Lasika Senasekera AND/OR nominee.”

•  If Employer First Choice Business Brokers fail to pay, EFT transfer and provide evidence of payment as of 15/04/2020 for Redundancy payment (4 weeks Notice payment, Redundancy payment, long service leave payment) and Other outstanding full balance of due payments (Unpaid commission payments, unpaid car allowances, unpaid

Superannuation payments, unpaid adjustments, other entitlements) as of 15/04/2020 or within 7 days. (by 22/04/2020)

•  Confidentiality Agreement dated 21/06/2013 incorporated at Employment Agreement no longer apply

•  Full rights of Interpretation of all terms and conditions of Employment Agreement solely remains with employee Chehan Lasika Senasekera AND/OR nominee.

If REDUNDANCY NOTICE dated 9/4/2020, found to be not genuine or illegal or invalid by any court or tribunal of competent jurisdiction Full rights of Interpretation of all terms and conditions of Employment Agreement solely remains with employee Chehans Lasika Senasekera AND/OR nominee.

•  As per your redundancy notice dated 9/4/2020 you mentioned

‘First Choice Business Brokers revenue is down 76% as against this time last year’. You have informed staff on 1/4/2020 at the staff meeting you applied for Government Coronavirus stimulus package ‘Job Keeper’.

You haven’t informed me if you wish to file for bankruptcy or become bankrupt or make any arrangement or composition with your creditors. Outstanding debt you owe me last for few months and some debt few years. There are some debt relate to income tax evasion and possible fraud. Also still we are still on stage 3- Covid-19 restrictions.

Therefore following clauses of my employment contract to be amended as of 15/04/2020.

•  6.2- This clause ‘Immediately on termination of the employee’s employment with the Employer’ words to amend to ‘Immediately on full payments of all outstanding payments and debt to Employee and upon Covid-19 restrictions lifted’.

•  6.3- This clause ‘Immediately on termination of the employee’s employment with the Employer’ words to amend to ‘Immediately on full payments of all outstanding payments and debt to Employee and upon Covid-19 restrictions lifted’

I have been a loyal and honest employee to you through out the employment term. Your actions in the past not transparent and honest. In specific;

•  Potential financial fraud to me and Australian Tax Office

•  Your illegitimate and unfair clauses on the employment contract to abuse all commission only employees

•  Your various operational misconduct misusing the Real Estate License granted by Business licensing Authority

•  Your past behaviour and actions of dispute avoidance and ignorance than resolve them

•  How you mistreated other First Choice Business Brokers employees and past employees upon termination of employment

•  Try to abuse current Covid-19 financial situation for your malpractice (You have made a fortune out of 17 commission only employees throughout past few years)

•  On first day of my 2019 overseas Christmas holiday send me a bully and harassment email because another well performed employee left the office due to your misconduct

•  Your coverdly action to cover up your professional negligence on 8/1/2020 when I was about to return from my overseas holiday without consulting me, on a deal I have been working over 2 years which cost me $47,200 loss.

•  Past few months harassment and attempts on unfair dismissal to avoid due financial payments

•  Again on the eve of Easter holiday give me redundancy notice knowing all professional advisers and services are closed.

As a above and given economic situation, should my Redundancy payments not paid on 15/04/2020 and/or all other due payments not paid within 7 days from 15/06/2020.

Clause 6.4 and Confidentiality agreement shall no longer apply to all Government departments as below.

•  Australian Taxation Office- All actions relate to prevent potential intentional ‘Bankruptcy’ and avoidance of payments

•  Australian immigration- As I don’t know if managing director is Australian Citizen to prevent escape from the country, notify the department.

•  Consumer Affairs - Notify all past misconducts

•  ASIC- Notify on all company misconduct

•  Fair work Australia-lodge official complaint

•  REIV- Report all member misconduct

•  City of Whitehorse

•  Any other Australian/Victorian legal or jurisdiction body

NOTE

This is further supplemented by my last employer who acted similar to this, and day after the redundancy lost license and then put the company to administration, continued to cheat many people in the society until ASIC sentenced him 6 years after. Please advice me ASAP when the outstanding payments processed. Also date and time for me to visit the office to collect my belongings and documents above.

Kind Regards,
Chehan Senasekera”

[47] The employer considered the above response from the applicant 38 and then on 15 April 2020 confirmed that it would make the applicant’s position redundant:

“Dear Chehan

Redundancy

The purpose of this letter is to confirm the outcome of a recent review by First Choice Business Brokers of its costs, in light of the effect of the COVID-19 outbreak on its business.

It is with regret that we confirm our decision that for the reasons previously outlined to you, we have decided that we can no longer support your position.

Unfortunately, this has resulted in your position being made redundant. This has been a very difficult decision for us to make.

For reasons already discussed, no alternative positions are available within First Choice in which to redeploy you. As a consequence your employment will cease as a result of the redundancy of your position, with effect from today.

The redundancy will take effect today, and you will receive your legal entitlements, which will be:

•  four weeks’ payment in lieu of notice ($3,450.00 gross); and

•  11 weeks’ redundancy ($9,487.50 gross) (together, the Termination Payment).

Please immediately provide us with your bank account details and current address so that we can pay you the Termination Payment less applicable tax promptly and send you a pay slip.

You may attend the office this afternoon at 4.30pm to retrieve your personal items and return the company’s property in your possession including keycard/door passes and confidential information including sellers and buyers records and other sales information.

Chehan, I take the opportunity to thank you for your contribution to First Choice and to wish you all the best for the future.

Yours sincerely,

Kevin Lee
Director”

[48] The applicant continues to claim that he was ‘tricked’, but on the material and submissions before me I am not satisfied that he was ‘tricked’. He was provided with the opportunity to respond and consult as required by clause 26 of the Real Estate Industry Award 2010, and took advantage of that opportunity by responding. The respondent took account of that response, and confirmed its decision, as it was entitled to do. I am not satisfied that the consideration was perfunctory or a mere matter of form, or other than genuine. This was a genuine process of consultation, as required by the award. I agree with the employer submission that: 39

“44. Although the Applicant raised a number of matters not directly related to the proposed redundancy, First Choice genuinely considered each of the matters raised. Specifically, First Choice considered:

(a) the Applicant’s claims for alleged unpaid commission, unpaid long service leave, and unpaid entitlements under the Award. First Choice considered that the Applicant had been paid his outstanding entitlements and that it was not in a position to pay him above his legal entitlements.

(b) the Applicant’s reference to First Choice’s eligibility for the government’s JobKeeper stimulus. First Choice was of the view that the JobKeeper stimulus was not guaranteed in respect of its commission-only agent’s representatives and was, in any event, a temporary measure. It therefore did not obviate the need to make immediate reductions.

(c) that other agent’s representatives had not been made redundant. First Choice had already discussed making one other agent’s representative redundant. It did not ultimately need to proceed with this as the other agent’s representative (Andrew Ho) voluntarily resigned.

45. The Applicant made a number of other separate allegations against First Choice regarding alleged misconduct during the Applicant’s employment.57 These allegations are not relevant to the proposed redundancy. For completeness, First Choice wholly denies in engaging in any of the alleged misconduct.

46. In light of the above, the opportunity provided to the Applicant was meaningful and not merely perfunctory.”

[49] In his supplementary submission the applicant also claims that because the general protections provisions of the Act were breached the notice of 9 April 2020 was ‘illegal’. 40 However, the applicant has not established a breach of the sections of the Act that he cites, he simply asserts this, and there is no proper foundation for the assertion.

[50] It is unfortunately an easy matter to make general assertions of bullying or illegal conduct in proceedings such as these in response to employer actions seeking to discipline or terminate an employee, and such assertions will not be accepted unless they are properly made out. It would be unfortunate if it became common practice to simply make such assertions when the employer makes an ordinary disciplinary or termination decision. This would cheapen what are important provisions designed to deal with actual problems. Those provisions are not designed to be a refuge from legitimate employer actions which are necessary to the effective functioning of the economy.

[51] The requirements of s.389(1)(b) are met.

Redeployment – s.389(2)

[52] With respect to the requirements of s.389(2) of the Act concerning redeployment options within the employer’s enterprise or the enterprise of an associated entity of the employer, the respondent submitted that: 41

“48. First Choice was considering reductions across its entire operations. There are no associated entities of First Choice. Therefore, there were no suitable available positions for the Applicant. In these circumstances, First Choice met its redeployment obligations under s 389(2) of the Act.”

[53] The applicant did not take issue with this to any great extent in his extensive submissions. On the evidence and submissions before me I find that the requirements of s.389(2) are met.

Conclusion

[54] I find that the requirements of s.389 are met on the submissions and evidence before me. I am therefore required to dismiss the application. An order dismissing the application is contained in PR721868.

[55] Even if I am wrong on this, and the requirements of s.387 are not satisfied because there is no valid reason within s.387(a), because it is a redundancy not a termination for the required reasons, and the other factors are neutral or met as the employer submits, it would not be ‘appropriate’ for me to order compensation within s.394 of the Act. The applicant has received satisfactory redundancy pay, and in all the circumstances this is a sufficient remedy in my view.

DEPUTY PRESIDENT

Appearances:

Mr Chehan Lasika Senasekera, Applicant
Ms Franceska Leoncio, Counsel for the Respondent
Mr Niksa Stanisic, Solicitor for the Respondent
Mr Kevin Lee, Respondent

Hearing details:

2020.
Melbourne (via Teleconference)
21 July.

Printed by authority of the Commonwealth Government Printer

<PR721867>

 1   Audio Recording of Jurisdiction and Arbitration Conference, dated 22 July 2020, 2:23.

 2   Respondent Digital Court Book, 70.

 3   Ibid, 5.

 4   Ibid, 92.

 5   Real Estate Industry Award 2010, cl. 16.7(b), (d).

 6   Audio Recording of Mention, dated 20 July 2020, 25:00.

 7   Ibid, 46:25.

 8   Ibid, 47:00.

 9   Ibid, 48:12.

 10   Ibid, 48:31.

 11 (2015) 215 IR 263.

 12   Applicant Additional Materials Digital Court Book, 6 [40]-[46].

 13   Respondent Digital Court Book, 99.

 14   Audio Recording of Jurisdiction and Arbitration Conference, dated 22 July 2020, 5:29.

 15   Applicant Digital Court Book, 244.

 16   Audio Recording of Mention, dated 20 July 2020, 37:59.

 17   Ibid, 39:29

 18   Applicant Additional Materials Digital Court Book, 2 [15], [18].

 19 Ibid, 2 [25].

 20   [2010] FWAFB 3488.

 21   Respondent Digital Court Book, 92-3.

 22   Ibid, 93.

 23   Ibid, 93.

 24   Ibid, 100.

 25   Applicant Additional Materials Digital Court Book, 2-3 [25]-[27].

 26   Respondent Digital Court Book, 93-4.

 27   Audio Recording of Jurisdiction and Arbitration Conference, dated 22 July 2020, 13:08.

 28   [2019] FWC 5446.

 29   Respondent Digital Court Book, 94.

 30   [2020] FWC 3707.

 31   Respondent Digital Court Book, 94.

 32   Ibid, 94-5

 33   Ibid, 102.

 34 Applicant Additional Materials Digital Court Book, 1-2, [6]-[13].

 35   MA000106.

 36   Respondent Digital Court Book, 101.

 37   Ibid, 70.

 38 Ibid, 7 [15].

 39   Ibid, 21.

 40   Applicant Additional Materials Digital Court Book, 1-2 [10]-[13].

 41   Respondent Digital Court Book, 22.