Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v NHP Electrical Engineering Products Pty Ltd
[2011] FWA 4911
•27 JULY 2011
[2011] FWA 4911 |
|
DECISION |
Workplace Relations Act 1996
s.170LW - pre-reform Act - Application for settlement of dispute (certified agreement)
Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia
v
NHP Electrical Engineering Products Pty Ltd
(C2011/3362)
COMMISSIONER RYAN | MELBOURNE, 27 JULY 2011 |
Alleged dispute concerning redundancy entitlements.
[1] The dispute in this matter filed by the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) concerns the entitlements of an employee, Mr Multari, whose employment was terminated by NHP Electrical Engineering Products Pty Ltd (NHP) just after he completed an apprenticeship.
[2] The parties to the dispute produced an Agreed Statement of Facts as follows:
“1. Matthew Multari (Multari) was employed by and started an Electrotechnology Certificate II Apprenticeship with NHP on 22 January 2007. The terms and conditions of Multari’s apprenticeship with NHP are contained in a Contract of Employment dated 21 December 2006 and signed by both parties.
2. Multari completed his apprenticeship on the 22 January 2011.
3. Multari was told by the Employee Relations Manager of NHP, Stuart Hammill, on the 31 January 2011 that, as his contract of employment as an apprentice with NHP had ceased on the 22 January 2011, NHP Management had decided not to offer him continuing employment with the Company.
4. For the period from 22 January 2011 to 31 January 2011 NHP paid Multari at the C10 (tradesperson) wage rate as contained in the Agreement.
5. Multari was an approved annual leave from 29th December 2010 to 25th January 2011 and was absent from work on the 27th and 28th January 2011.”
[3] What is clear from the Agreed Statement of Facts is that Mr Multari never worked for NHP as a tradesperson. Mr Multari only ever performed work for NHP as an apprentice.
[4] The CEPU asserts that as Mr Multari had passed the end of his apprenticeship at the time of his dismissal, then his dismissal was a redundancy and for which Mr Multari should have been paid the retrenchment payments provided for in the workplace agreement.
[5] NHP asserts that Mr Multari was able to be dismissed at the end of his apprenticeship in accordance with the letter of engagement as an apprentice and that even though the actual date of the termination was a few days after Mr Multari had completed his apprenticeship the effective reason for the termination was that the apprenticeship had ended. NHP assert that no retrenchment pay is owed.
What industrial instrument/s apply/cover Mr Multari?
[6] The application in this matter identifies that the dispute is referred to FWA pursuant to the dispute settlement procedure in the NHP Electrical Products Pty Ltd Enterprise Agreement 2009 (the Agreement).
[7] Clause 3 of the Agreement describes the coverage of the Agreement as:
“This Agreement applies to all employees who are employed as:
* Employees classified from C13 to C6 under the Award and who are eligible for membership of the CEPU.”
[8] Clause 24 of the Agreement provides as follows:
“24 Apprentices
The parties agree that all apprentices covered by this Agreement will continue to be paid for all time spent at trade school and will not in any way be disadvantaged by changes to legislation governing the indenture, training and payment of apprentices.”
[9] The very presence of clause 24 suggests that apprentices are covered by the Agreement even though apprentices are not “classified from C13 to C 6 under the Award” and would therefore not be employees covered by the Agreement.
[10] The Agreement contains clause 7 in the following terms:
“7 Relationship to Parent Awards
This Agreement shall be read and interpreted wholly in conjunction with the Metal, Engineering and Associated Industries Award 1998 (as at September 2005 which includes the 20 allowable matters consistent with the WR Act 1996), provided that where there is any inconsistency between this Agreement and the Award, this Agreement shall take precedence to the extent of any inconsistency.
The parties agree that the following terms in the above-mentioned award are contrary to the National Code of Practice for the Construction Industry or the Australian Government Implementation Guidelines and accordingly these terms are expressly excluded by the parties and do not form any part of this Agreement:
3.1.2 Noticeboard
3.2.1(b) (second paragraph) Time off for delegates to attend meetings with union official
3.2.4 Redundancy disputes
4.2.3 (b) (i) – (f) Casual employment
4.2.3 (c)
7.1 The parties agree that the facilitative provisions incorporated into the Award, as a result of the Section 89A process under the Workplace Relations Act 1996, will not be enacted by the parties to this Agreement during the life of the Agreement.
7.2 The parties are committed to the Award continuing to cover the basic conditions of employment in the industry.
7.3 An employee commencing his or her employment with the employer after the date on which this Agreement comes into operation, shall be employed in accordance with the terms of this Agreement.”
[11] It may be that clause 7 was intended to incorporate the Award into the Agreement. However on the plain wording of clause 7 that clause operates to do no more than create a reference document for the purposes of assisting in the interpretation of clause of the Agreement.
[12] Clause 7 of the Agreement does not incorporate anything into the Agreement.
[13] Having considered each of clauses 3, 24 and 7 and their combined effect, it is clear that the Agreement does not cover persons employed as apprentices who are not otherwise employed in a classification specified in clause 3 of the Agreement.
[14] Apprentices employed by NHP will be employed under the terms of the appropriate modern award, namely the Manufacturing and Associated Industries and Occupations Award 2010 (the Award).
[15] Clause 15 of the Award deals with the subject matter of Apprentices and includes the following provision.
“15.11 Except as provided in clause 15 - Apprentices or where otherwise stated, all conditions of employment specified in this award apply to apprentices. Notice of termination and redundancy provisions do not apply to apprentices.”
[16] I note in passing that clause 15.11 of the Award reflects the provisions of s.123(4)(a) of the Act which also excludes apprentices from the redundancy pay provisions in s.119 of the Fair Work Act 2009.
[17] If Mr Multari had been dismissed on 22 January 2011 then, as an apprentice, he would have had no entitlement to a redundancy payment. The fact that the dismissal took place on 31 January 2011 carries with it several consequences and questions. The consequence which directly flows from the date of dismissal is that at that date Mr Multari was no longer an apprentice. The questions which directly flow from this are:
- If Mr Multari was no longer an apprentice was he covered by the Award or the Agreement, and
- What redundancy entitlement did Mr Multari have?
After 22 January 2011 what covered Mr Multari?
[18] Although Mr Multari had completed his apprenticeship on 22 January 2011 he never commenced employment with NHP as a tradesperson. It is clear that Mr Multari was never an employee who was classified in a classification from C13 to C 6 under the award referred to in the Agreement. The termination letter to Mr Multari, dated 25 January 2011, contained the following:
“Attached is your Statement of Termination which provides details of your final pay. Please note that you have been paid two weeks pay in lieu of notice as well as outstanding ordinary time monies for Thursday 27th January. Your rate of pay has also been increased to that of a C10 Electrical Fitter.”
[19] The increase in the rate of pay from the rate for an apprentice to the rate for a C10 cannot be taken to be a concession that NHP employed Mr Multari as a C10.
[20] Although NHP paid Mr Multari as a C10 for the purposes of calculating his termination pay I do not consider that he was classified as a C10 employee. Therefore Mr Multari was not an employee covered by the terms of the Agreement. That being the case, then, Mr Multari was an employee covered by the Award.
Is Mr Multari entitled to a redundancy payment?
[21] As an apprentice Mr Multari had no entitlement under the Award or the Act to a redundancy payment. As an employee who is not an apprentice Mr Multari, prima facie has a right to a redundancy payment, if the conditions for receiving a redundancy payment are met.
[22] The conditions for receiving a redundancy payment are set out in s.119 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.”
[23] Paragraph 119(1)(b) is not relevant to the present matter.
[24] It is clear that the termination of Mr Multari was at the initiative of NHP. However the reason for the termination was not that “the employer no longer requires the job done by the employee to be done by anyone”. Rather the termination was for the reason that the employer did not wish to convert Mr Multari’s employment from that of apprentice to that of tradesperson.
[25] In a very real sense the termination was effected because Mr Multari was no longer capable of being employed in the position for which he had been employed, namely apprentice. Mr Multari’s employment could have continued only if NHP took a positive step of employing Mr Multari as a tradesperson. This NHP did not do.
[26] The CEPU relied upon the decision of SDP Williams in Paul Kinniburgh v Printers Press Pty Ltd [P6340]. I do not doubt the correctness of that decision. That decision stands firmly for the proposition that a contract of training and a contract of employment do not have to have the same termination date. That decision doesn’t provide an answer for the question: Can the contract of employment come to an end at the completion of the apprenticeship where the contract of employment is based upon employment as an apprentice.
[27] In the present matter Mr Multari was directly employed as an apprentice and nothing more. The letter of offer dated 21 December 2006 provided a specific qualification that employment beyond the apprenticeship could not be guaranteed. In fact the letter of offer specifically reserved to NHP the right to offer further employment to Mr Multari after the completion of the apprenticeship. The structure and purpose of the letter of offer supports the contention of NHP that they did no more than terminate Mr Multari at the completion of his apprenticeship in accordance with their right to do so under the letter of offer.
[28] I have taken into account the conduct of NHP and that conduct is not consistent with NHP merely acting in accordance with their rights under the letter of offer.
[29] There is nothing before me to suggest that the period of annual leave taken by Mr Multari was not approved in advance by NHP. The period of approved annual leave taken by Mr Multari was from 29 December 2010 to 25 January 2011. This period went beyond the period of the apprenticeship of Mr Multari. Thus NHP were granting a period of paid leave to Mr Multari after he completed his apprenticeship. NHP clearly considered Mr Multari to be an employee of theirs after the period of apprenticeship was completed, and this decision was made prior to Mr Multari commencing his period of annual leave.
[30] NHP contended in its written submissions that the only reason NHP did not notify Mr Multari of the decision to dismiss him prior to or on 22 January 2011 was that NHP “did not consider notification to Multari of its decision by mail or electronic communication to be professional or appropriate under the circumstances.”
[31] Implicit in this contention from NHP is that NHP did consider it to be “professional or appropriate” to approve a period of annual leave for Mr Multari which went beyond the completion date of the apprenticeship, and then dismiss him on return from annual leave. Also implicit in this contention is that NHP was prepared to act in an extremely callous manner towards Mr Multari. Fairness and common courtesy towards an employee would suggest that NHP should have advised Mr Multari before he commenced his annual leave that NHP intended to dismiss him on completion of his apprenticeship. Such fairness and courtesy would have enabled Mr Multari to commence looking for work immediately and may also have led to Mr Multari not taking annual leave. The callousness of NHP derives from either of two scenarios. Either NHP had decided before Mr Multari commenced annual leave that it would dismiss him but it chose not to tell him, or NHP waited until after Mr Multari had commenced his period of annual leave before it made a decision to dismiss him.
[32] Regardless of which scenario applied, NHP did not in fact dismiss Mr Multari until after the completion of his apprenticeship and at the time of dismissal Mr Multari was not an apprentice.
[33] Having considered the conduct of NHP it is clear that the contention of NHP that “the Respondent exercised its right not to continue with Multari’s employment at the completion of his apprenticeship” is not supported by the conduct of NHP.
[34] As I have already found that the dismissal was not a redundancy within the meaning of the Act I cannot determine or order that any redundancy payments be made.
[35] I do note that whilst NHP paid 2 weeks’ pay in lieu of notice to Mr Multari the correct amount should have been 3 weeks given the operation of s.117(3) of the Act.
[36] The application in this matter seeks only an arbitration of the issue in dispute and the above reasons and decision have done that. Neither party sought any recommendation from the Tribunal in relation to this matter. However given the context in which Mr Multari’s employment was terminated by NHP, I would strongly recommend to NHP that it redress the callousness of its conduct by making a payment to Mr Multari of 4 weeks’ pay at the C10 rate.
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