Christos Papathanasiou v HBS Group Pty Ltd

[2013] FWC 6838

[2013] FWC 6838

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Christos Papathanasiou
v
HBS Group Pty Ltd
(U2012/12560)

DEPUTY PRESIDENT GOOLEY MELBOURNE, 11 SEPTEMBER 2013

Application for relief from unfair dismissal - genuine redundancy - application dismissed.

[1] Mr Christos Papathanasiou worked for HBS Group Pty Ltd (HBS) at the GPO site from October 2011 until his employment was terminated on 16 August 2012.

[2] Mr Papathanasiou is a carpenter though he did a range of jobs for HBS since February 2009. HBS undertakes restoration and renovation construction work on old or historic buildings.

[3] At the commencement of Mr Papathanasiou’s most recent engagement with HBS, there was an agreement about his hourly rate of pay. Mr Papathanasiou was required to submit weekly time sheets and invoices which included his ABN number. When there were downturns in work he did not work and he was not paid. He worked regularly from October 2011 until he was told to finish up in August 2012. He said he was employed as a casual employee. HBS had contended that Mr Papathanasiou was a subcontractor but Commissioner Gregory dismissed that jurisdictional objection and found that Mr Papathanasiou was an employee and was protected from unfair dismissal. 1

[4] HBS said that the termination of Mr Papathanasiou’s employment was a genuine redundancy. Mr Papathanasiou said his employment was terminated because he made complaints about HBS not paying his superannuation contributions and because he had made complaints about being asked to sign blank tool box meeting documents to enable HBS to circumvent its OHS obligations.

[5] The issues to be determined are:

a) Was Mr Papathanasiou’s job no longer required because of changes in HBS’s operational requirements?

b) If it was, did HBS comply with its obligations under the HBS Group Pty Ltd and the CFMEU Building and Construction Industry Enterprise Agreement 2011-2015 (the Agreement) to consult with Mr Papathanasiou?

c) Was it reasonable to redeploy Mr Papathanasiou?

d) If the answer to any one of the questions of above was no, was the termination of Mr Papathanasiou’s employment harsh, unjust or unreasonable?

e) What is the appropriate remedy?

Was Mr Papathanasiou’s job no longer required because of changes in HBS’s operational requirements?

[6] I accept the evidence of Mr Nicholas Simpson and Mr Jamie Cookson, HBS’s directors that the GPO job was coming to an end and that they did not need as many carpenters. It was not contested by Mr Papathanasiou that the GPO job was winding down. HBS submitted that it no longer required Mr Papathanasiou’s job to be done by anyone because of changes to their operational requirements.

[7] Paragraph 1548 of the Explanatory Memorandum 2 gave some examples of changes in operational requirements:

“1548. The following are possible examples of a change in the operational requirements of an enterprise:

● a machine is now available to do the job performed by the employees;

● the employer’s business is experiencing a downturn and therefore the employer only needs three people to do a particular task or duty instead of five; or

● the employer is restructuring their business to improve efficiency and the tasks done by a particular employee are distributed between several other employees and therefore the person’s job no longer exists.”

[8] It is clear that there were changes in HBS’s operational requirements. The GPO job was not an ongoing project. The practical completion date for the project was 12 December 2012. As the completion date approached the number of employees required on site decreased.

[9] Mr Papathanasiou submits that there were other employees who should have been made redundant before him, or that other employees should have been redeployed to other sites leaving him at the GPO or that the same number of employees should have remained in employment and the job would have finished earlier. He also says that the reason he was dismissed was because he had complained about his superannuation and raised occupational health and safety issues.

[10] It is not necessary to determine at this point whether these contentions are correct.

[11] The Full Bench in UES (Int’l) Pty Ltd v Leevan Harvey 3 (UES) said, “the terms of s.389 of the FW Act suggest the process for selecting individual employees for redundancy is not relevant to whether a dismissal is a case of genuine redundancy.”

[12] This conclusion is supported by paragraph 1553 of the Explanatory Memorandum which provides :

“Whether a dismissal is a genuine redundancy does not go to the process for selecting individual employees for redundancy. However, if the reason a person is selected for redundancy is one of the prohibited reasons covered by the general protections in Part 3-1 then the person will be able to bring an action under that Part in relation to the dismissal.”

[13] HBS had operational reasons for reducing the number of carpenters on the GPO job. I do not accept the submissions that HBS should have retained all the carpenters for a shorter period of time. There was no evidence to support this submission. Issues about the selection process are not relevant determining this issue. I therefore conclude that Mr Papathanasiou’s job was no longer required because of changes in HBS’s operational requirements.

Did HBS comply with its obligations under the Agreement to consult with Mr Papathanasiou?

[14] The Agreement provides for consultation about major workplace change that is likely to have a significant effect on employees.

[15] HBS is required to notify any employees who will be affected by the decision, discuss the introduction of the change and the effect of the change on employees as well as measures to avert or mitigate the adverse effect of the change on employees.

[16] HBS is required to provide, in writing, all relevant information about the change and the expected effects of the change on employees.

[17] HBS submitted that it had no obligation to consult with employees. It submitted that the Agreement requires there to be both major workplace change and that the change is likely to have a significant effect on employees covered by the Agreement.

[18] HBS said there was no major workplace change. It submitted that the termination of Mr Papathanasiou’s employment could not constitute a major workplace change and therefore HBS did not have to consult with employees.

[19] The Agreement provides as follows:

“A major change is likely to have a significant effect on employees if it results in:

(i) termination of employment of employees;

....................

(iv) the need to relocate employees to another workplace;”

[20] I do not accept HBS’s submissions. The GPO job was coming to an end. This is a major change that was likely to have a significant effect on employees. Employees would be relocated or have their employment terminated.

[21] I therefore find that HBS had an obligation to consult with employees.

[22] Mr Simpson gave evidence that in May 2012 he asked if the carpenters wanted to continue working for HBS or to take voluntary redundancy. He told them that the timber work at the GPO would finish in two to three months.

[23] At a Tool Box meeting held on 16 June 2012, Mr Cookson told the workers that carpentry work was coming to an end. 4 Mr Papathanasiou said this meeting did not occur. He said tool box meetings were not held on Saturdays and Mr Cookson never conducted tool box meetings. While his signature is on the tool box meeting sheet, it was his evidence that he was asked to sign blank forms that were not filled in when he signed them. I prefer Mr Cookson’s evidence that he did conduct tool box meetings, and that tool box meetings were sometimes held on Saturdays. I accept Mr Cookson’s evidence that on 16 June 2012 he told the workers that the GPO job was coming to an end.

[24] I accept that HBS advised employees in a general way that the GPO job was coming to an end and discussed with them, relocation to other sites to mitigate the impact of the change. However there was no consultation, once a definite decision had been made, to reduce the number of employees on the GPO site and to terminate Mr Papathanasiou’s employment. This decision was made on 16 August 2012. 5 I therefore find that HBS did not comply with its obligations under the Agreement.

Was it reasonable to redeploy Mr Papathanasiou?

[25] Whilst Mr Papathanasiou was an employee he was paid as though he was a subcontractor. This had not been a problem whilst he was employed on the GPO site because HBS was the head contractor. However, Mr Simpson gave evidence that he could not be engaged on that basis on other sites where they may have been able to relocate Mr Papathanasiou to. Mr Papathanasiou was asked in May and August 2012 to go onto wages and he refused. 6 Mr Papathanasiou said he did not understand that this meant he could not work on other sites. Even accepting this, it made relocation of Mr Papathanasiou difficult.

[26] Given I have found that HBS failed to consult, as required by the Agreement, I do not have to determine if Mr Papathanasiou could have been redeployed. Because of the lack of consultation the termination was not a genuine redundancy.

Was the termination of employment harsh, unjust or unreasonable?

[27] In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the Fair Work Commission (the Commission) must take into account the following:

Whether there was a valid reason for the dismissal related to Mr Papathanasiou’s capacity or conduct (including its effect on the safety and welfare of other employees): s.387(a)

[28] In UES 7 the majority of the Full Bench considered the relevance of this criterion in a case where the Commission had determined that the termination was not a genuine redundancy because there had been a failure to consult.

[29] It held that where the termination of employment is not related to an employee’s capacity or conduct “there cannot have been and was not a valid reason for [the] dismissal” 8 and this criterion is neutral.

[30] In this case Mr Papathanasiou’s employment was not terminated because of his capacity or conduct and therefore this criterion is neutral.

Whether Mr Papathanasiou was notified of that reason: s.387(b)

[31] As the reason was not related to his capacity or conduct, this criterion is also neutral.

Whether Mr Papathanasiou was given an opportunity to respond to any reason related to the capacity or conduct: s.387(c)

[32] Again, as the reason was not related to his capacity or conduct, this criterion is neutral.

Any unreasonable refusal by the employer to allow Mr Papathanasiou to have a support person present to assist at any discussions relating to dismissal: s.387(d)

[33] Mr Papathanasiou did not ask to have a support person with him at the meeting on 16 August 2012. This is not surprising as he did not know what the meeting was about.

If the dismissal related to unsatisfactory performance—whether Mr Papathanasiou had been warned about that unsatisfactory performance before the dismissal: s.387(e)

[34] The dismissal was not related to unsatisfactory performance.

The degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal: s.387(f)

[35] HBS is a small construction company.

The degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal: s.387(g)

[36] HBS had no dedicated legal or human resources expertise. It should be noted that Mr Simpson has extensive experience in commercial and domestic construction.

Any other matters that the Commission considers relevant: s.387(h)

[37] Mr Papathanasiou had worked in the construction industry for 60 years. He was 70 years old when his employment was terminated. He wanted to continue working. However his employment with HBS was not ongoing. He worked from project to project with no guarantee of ongoing work once a project was completed. At the time of his dismissal he had been working for ten months.

[38] Mr Papathanasiou was in dispute with HBS about his superannuation from May 2012. While it was submitted this was the real reason Mr Papathanasiou was dismissed, the evidence does not support this contention.

[39] Prior to Mr Papathanasiou raising superannuation with Mr Simpson, Mr Simpson had told him and the other carpenters that the GPO job would be coming to an end and there was work on the UWS job. 9 Mr Papathanasiou had not wanted to be relocated to this job if he had to stop being a contractor on an hourly rate.

[40] It was only after this discussion that Mr Papathanasiou asked if he could be paid his superannuation on top of his hourly rate. 10 There was an agreement reached to pay Mr Papathanasiou’s superannuation going forward but they did not agree on the amount that should be back paid.11 While Mr Papathanasiou gave evidence that superannuation was again discussed on 16 August 2012, I prefer the evidence of Mr Simpson and Mr Cookson who both denied that there was any discussion of superannuation at that meeting.

[41] I am unable on the evidence before me to conclude that Mr Papathanasiou’s employment was terminated because he complained about the dispute about his superannuation payments.

[42] It was further suggested that Mr Papathanasiou’s employment was terminated because he refused to sign blank tool box meeting sheets. However I am unable to find, on the evidence, that Mr Simpson or Mr Cookson even knew about his refusal to sign the forms or his reasons for refusing to sign the sheets. At its highest Mr Papathanasiou said that he had spoken to Marty, the leading hand and the OH&S representative, Aris, about this and that Mr Cookson had been outside a room when he refused to sign the papers. 12

[43] I have found that Mr Papathanasiou’s employment was terminated because work was coming to an end at the GPO site. I have found it was not a genuine redundancy because HBS did not comply with its obligations under the Agreement to consult.

[44] Given that HBS thought that Mr Papathanasiou was a contractor it is likely that HBS did not turn its mind to the Agreement as it did not consider it applied to Mr Papathanasiou’s engagement. Similarly it did not consider redeployment because of Mr Papathanasiou’s refusal to go “on the books”. 13 While it is true, given the decision of the Commission that Mr Papathanasiou was an employee, that this would not have been a barrier to his redeployment, at the time Mr Simpson and Mr Cookson made the decision to terminate Mr Papathanasiou’s employment they were unaware of his actual status as an employee.

[45] Mr Papathanasiou was a daily hire employee or a casual employee. Mr Papathanasiou knew the job was coming to an end. In the past when that occurred he finished up and waited until he was called to another job. Mr Papathanasiou objected to the way his employment was terminated. He was called down from the work he was doing on the day and finished up immediately although he was paid for the next day. Mr Papathanasiou considered he was treated differently that day. However that is not enough for me to find that the termination of his employment was harsh, unjust or unreasonable.

Conclusion

[46] The failure to consult is serious. However in this case consultation would not have changed the outcome. The work that Mr Papathanasiou was doing was coming to an end. All the employees would either have their employment terminated or they would be relocated. Mr Papathanasiou would not accept a change in his conditions of employment so that he could work on other commercial sites. In all the circumstances I do not find that the termination of Mr Papathanasiou’s employment was harsh, unjust and unreasonable. The application is dismissed.

DEPUTY PRESIDENT

Appearances:

G. Dircks for the Applicant.

N. Simpson for the Respondent.

Hearing details:

2013.

Melbourne:

July 3.

 1   [2013] FWC 1112.

 2   Explanatory Memorandum to the Fair Work Bill 2008.

 3   [2012] FWAFB 5241 at [27].

 4   Document A09 of the Respondent’s Outline of Submission.

 5 Transcript PN 2378-2380 and Exhibit R2 at [34].

 6   Transcript PN 1089-1098.

 7   UES op cit.

 8 Ibid at [42].

 9 Exhibit R2 at [21].

 10   Ibid.

 11 Ibid at [23].

 12   Exhibit A1 at [24]-[34].

 13   Ibid at [21] and [30].

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