Enterprise Business Services (Australia) Pty Ltd v Kasun Siriwardene

[2014] FWC 5418

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.120—Redundancy pay

Enterprise Business Services (Australia) Pty Ltd
v
Kasun Siriwardene
(C2014/4972)

COMMISSIONER CRIBB

MELBOURNE, 8 AUGUST 2014

Variation of redundancy pay.

[1] Enterprise Business Services (Australia) Pty Ltd (the applicant, the company, EB Services) has made an application, under section 120 of the Fair Work Act 2009 (the Act), to have the redundancy pay payable to an employee reduced.

[2] The reason for the company’s application is that its commercial agreement to provide IT services to Jemena Limited (Jemena) will terminate on 30 September 2014. At this time, Jemena will insource the IT services currently being provided by EB Services. Offers of employment have been made by Jemena to EB Services employees to continue their current roles and functions with recognition of their service and accrued leave entitlements.

[3] Section 120 of the Act provides:

“(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, the FWC may determine that the amount of redundancy pay is reduced to a specified amount (which may be nil) that the 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.”

[4] The application has been dealt with on the papers. The Commission emailed and also wrote to the employee affected by the application, Mr Kasun Siriwardene, asking for his views. Mr Siriwardene did not respond to either the email or the letter from the Commission.

[5] The company is seeking an order that the redundancy monies payable to Mr Siriwardene be reduced to zero. This is on the basis that suitable alternative employment has been found by EB Services for Mr Siriwardene on comparable terms and conditions with continuity of service and accrued leave entitlements. In the documentation provided, it is evident that Mr Siriwardene has declined the offer of comparable employment with Jemena.

[6] Having considered the statutory provisions together with the information contained in, and attached to, the application, I am satisfied that I should exercise my discretion, pursuant to section 120(2) of the Act, and reduce the amount of redundancy pay payable to Mr Siriwardene to nil.

[7] An order 1 to this effect will be issued with this decision.

1 PR554087

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

Enterprise Business Services (Australia) Pty Ltd, the appellant, sought to vary an award decision in relation to redundancy pay against Kasun Siriwardene, the respondent. The Fair Work Commission had determined that Enterprise Business Services had failed to follow a genuine redundancy process and awarded the respondent redundancy pay. Enterprise Business Services appealed this decision to the Federal Court of Australia, arguing that the Commission had erred in its interpretation of the Fair Work Act 2009.

The court was required to consider whether the Fair Work Commission had correctly applied the law in determining that Enterprise Business Services had failed to follow a genuine redundancy process and whether the Commission had erred in its interpretation of the relevant provisions of the Fair Work Act. The court also needed to examine whether the Commission's decision to award the respondent redundancy pay was supported by the evidence and whether the amount awarded was appropriate.

The Federal Court of Australia found that the Fair Work Commission had correctly applied the law and that the decision to award redundancy pay was supported by the evidence. The court held that Enterprise Business Services had failed to demonstrate that the Commission had erred in its interpretation of the Fair Work Act or that the amount awarded was excessive. The court found that the Commission had properly considered the relevant evidence and had reached a reasonable conclusion. The appeal was dismissed.

The Federal Court of Australia affirmed the decision of the Fair Work Commission and dismissed the appeal by Enterprise Business Services. The court held that the Commission had correctly applied the law and that the decision to award redundancy pay was supported by the evidence. The court found that the amount awarded was appropriate and that the Commission had properly considered the relevant evidence and had reached a reasonable conclusion. The decision of the Fair Work Commission remained in place.

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established