Gamboni v Bendigo and Adelaide Bank Ltd
[2013] VSCA 92
•2 May 2013
SUPREME COURT OF VICTORIA
COURT OF APPEAL
S APCI 2011 0207
| WILLIAM BERNARD GAMBONI | Appellant |
| v | |
| BENDIGO AND ADELAIDE BANK LTD (ACN 068 049 178) | Respondent |
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| JUDGES | HARPER and TATE JJA and KYROU AJA |
| WHERE HELD | MELBOURNE |
| DATE OF HEARING | 14 March 2013 |
| DATE OF JUDGMENT | 2 May 2013 |
| MEDIUM NEUTRAL CITATION | [2013] VSCA 92 |
| JUDGMENT APPEALED FROM | Gamboni v Bendigo and Adelaide Bank Ltd [2011] VCC 1442 (Judge Ginnane) |
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EMPLOYMENT — Redundancy — Appeal against County Court order dismissing claim for redundancy payment — Bank — Reorganisation — Redundancy policy — Meaning of phrase ‘the work being done or position held by an employee, or a major portion of it is no longer required’ — Attributes of pre-reorganisation work and proposed post-reorganisation work compared — Defining features of pre-reorganisation work did not survive reorganisation — Comparison of pre-reorganisation and post-reorganisation position with reference to nature of work, title, status and seniority of position, reporting lines and level of autonomy — Major portion of pre-reorganisation work not required post-reorganisation — Appeal allowed.
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| Appearances: | Counsel | Solicitors |
| For the Appellant | Mr G H Golvan QC with Mr M I Borsky | Gary Rothville & Associates |
| For the Respondent | Mr P O’Grady | Hall & Wilcox |
HARPER JA:
I have had the benefit of reading the draft reasons of Kyrou AJA and agree for the reasons given by his Honour that the appeal should be allowed.
TATE JA:
For the reasons given by Kyrou AJA, I agree that the appeal should be allowed.
KYROU AJA:
Introduction and summary
This is an appeal by William Gamboni against an order made by the County Court on 12 December 2011 dismissing his claim against his former employer, Bendigo and Adelaide Bank Ltd (‘Bank’), for a redundancy payment.[1]
[1]Gamboni v Bendigo and Adelaide Bank Ltd [2011] VCC 1442 (‘Reasons’).
The trial judge decided that Mr Gamboni did not satisfy the requirements of the Bank’s redundancy policy dated 7 October 2008 (‘Policy’). His Honour held that, although there had been a reorganisation in July 2009, the major portion of Mr Gamboni’s work and position as the Senior Manager, Property Finance, continued to be required after the reorganisation.
The purpose of the Policy was described as follows:
Situations may arise that cause a position or positions to be made redundant. The Bank is committed to doing everything it can reasonably do to support employee(s) in this circumstance, including seeking to identify suitable alternative employment within the Bank. If suitable alternative employment can not be found for an employee, a redundancy package will be offered in accordance with the terms outlined in this policy.
The Policy defined ‘redundancy’ as follows:
‘Redundancy’ means a situation where the work being done or position held by an employee, or a major portion of it is no longer required:
a as a result of changes in economic or business conditions; or
bto be undertaken in its current location, or a location within a reasonable distance; or
cbecause of reorganisation (whether internal, external, group wide or at Business Unit level); or
d because of changes to business or management practices; or
e because of technological or related changes.
It is important to understand that a position becomes redundant, not an employee. An employee will not be offered a redundancy package unless their position has become redundant and another suitable alternative position is not available.
For the reasons that follow, I am of the opinion that the trial judge misconstrued and misapplied the Policy and that the appeal should be allowed.
Facts
(a) Mr Gamboni’s role within the Bank prior to the July 2009 reorganisation
Mr Gamboni was employed by Sandhurst Trustees Ltd (‘Sandhurst’) in 1987. In the present context, Sandhurst’s main activity was to receive deposits from investors into its common funds and to use those funds to make loans on the security of commercial property that earned sufficient income to meet loan repayments. Sandhurst was regulated by the Trustee Act1958 (Vic).
Sandhurst had a Property Finance Unit (‘Unit’) with a select commercial property customer base, with a distinct portfolio of large commercial property loans and construction finance loans. The only securities that the Unit obtained were first mortgages over income producing commercial property. The Unit did not engage in general banking activities. It was not regulated by the Banking Act1959 (Cth).
In 1992, Sandhurst was taken over by the Bendigo Building Society, which later became the Bank. The Bank operated under a licence granted pursuant to the Banking Act and was regulated by the Australian Prudential Regulation Authority. The Bank engaged in a broad range of banking activities, including business overdrafts, home loans and credit cards. It had consumer and business customers and made a wide range of unsecured and secured loans. It accepted different forms of security. The Bank’s lending policies differed from those of Sandhurst.
Mr Gamboni’s finance industry experience was confined to the making of loans to the commercial property market using Sandhurst’s lending policies. He did not have any broader banking experience, including the type of work performed by a business banker. He was familiar with the Trustee Act but not the Banking Act.
On 11 September 2006, Mr Gamboni was appointed to the position of ‘Senior Manager, Property Finance’. His contract of employment for that position contained the following key provisions:
1. Position
Your position with the Bank will be that of Senior Manager Property Finance as described in the attached Position Description, as varied from time to time. Please note that acceptance of the offer repudiates all previous contracts of employment with the Bank.
…
3. Continuity
Your role, levels of responsibility, reporting lines and duties may be significantly varied throughout your service with the Bank. It is agreed that irrespective of any such variations, by negotiation or otherwise, the terms and conditions set out in this Agreement will continue to apply as contractual provisions, unless otherwise amended in writing.
4. Duties
(a)You will report to and be subject to the direction of Peter Opie, Chief Manager Lending, or such other employee of the Bank as may be nominated from time to time.
(b)You will be required to carry out all lawful directions of the Bank or its agents and will discharge such duties and functions as may be delegated to or assigned to you including:
(i)work for any related, associated or subsidiary companies of the Bank (‘Related Body Corporate’); and
(ii)work in positions other than that to which you were initially appointed.
…
…
6.Bank Policies
You are required to perform your duties in accordance with all Bank policies, written procedures, rules, regulations and any codes of practice, including the Bank’s Code of Conduct, as issued and amended from time to time. All Bank policies, written procedures, rules, regulations, codes of practice, and Bank’s Code of Conduct constitute terms of your contract of employment.
The Bank’s policies etc may be accessed on the Bank’s intranet or you may request a copy from your manager. …
It is common ground that the Policy formed part of Mr Gamboni’s contract of employment.
The key provisions of the position of Senior Manager, Property Finance were as follows:
Organisational and Position Overview
As a Senior Manager, Property Finance you will play a leadership role in the long-term development of the business unit you are managing. You will require a sound knowledge of the commercial property market to establish and implement strategies to achieve growth of your portfolio. The ability to establish and maintain quality referral networks to ensure the continued growth of your portfolio. By proactively servicing these needs you will establish and maintain sustainable relationships. You will also assist in the development of support staff by proactively monitoring & mentoring your subordinates.
Reporting to the Chief Manager Retail Lending the position’s key focus is to develop and maintain a high value, low credit risk business portfolio by building vigorous referral partnerships with the major introducers & customers which equate to the top 20% of your customer base by number & 70% of your customer base by value. You will mentor & monitor Manager Property Finance in his control & management of the balance of the portfolio relationships comprising both new and existing customers providing for their property financing needs. You will have an in depth understanding of the market in which [the] property finance department operates & have exceptional financial analysis & interpersonal skills to deal with customers at the highest level within the commercial property market & assist the manager property to further develop his skills by delegating, prioritising & mentoring his business activities.
Key Result Areas (5–8 Areas)
…
· Proactively developing and implementing internal and external business development strategies within the relevant region to achieve business growth and other financial objectives.
…
· Leadership, management, training and development of Manager Property Finance.
· Management and development of new/existing customers and referral partners.
…
Special Requirements
· Preparing annual Capital Expenditure budgets as required by the Bank
· Monitor Budget results, and Reporting requirements
…
Person Specification
…
· Proven track record in business development skills with a focus on large Commercial Property Lending and Property Development for select customers within the portfolio. …
Prior to the July 2009 reorganisation, the Unit comprised two employees in addition to Mr Gamboni as the head of the Unit. Reporting to Mr Gamboni were Brock Pinner, the Manager, Property Finance and Nathan Cail, the Lending Officer. Mr Gamboni reported to Peter Opie, the Chief Manager Lending of the Retail Bank. When Mr Opie performed other duties for two or three years, Mr Gamboni reported to a Senior Manager, Business Banking, Robert Dupuy.
The Unit was a stand-alone department within the Bank. As the head of that department, Mr Gamboni had some budgeting responsibilities.
Many of the Unit’s commercial property customers were Jewish business people who were introduced to the Unit by a Melbourne solicitor, Robert Fixler, with whom Mr Gamboni had a close association. Approximately 60 to 70 per cent of the commercial property loan portfolio was referred by Mr Fixler.
In January 2007, Mr Pinner left the Unit and, later, he went on leave without pay from the Bank. He was replaced as Manager, Property Finance by Dale Myers. Mr Pinner had business banking experience. According to Mr Opie’s evidence, Mr Cail performed the ‘rats and mice work’.
(b) Reorganisation resulting from the Global Financial Crisis
The Global Financial Crisis (‘GFC’), which commenced at the end of 2008, resulted in investors withdrawing their funds from Sandhurst’s common funds because they did not have a government guarantee. This meant that Sandhurst could not continue to lend to the commercial property market. Consequently, the Unit no longer had access to Sandhurst funds to make new loans or to roll-over existing loans. The Bank assisted Sandhurst’s liquidity by purchasing some of its mortgages. The future of the Unit became uncertain.
In March 2009, Mr Opie decided to accept a redundancy package. He left the Bank on 25 June 2009. He was replaced by his former assistant, David Pugh.
On 16 March 2009, following discussions with Mr Opie and Greg Penno in the Bank’s Human Resources Department, Mr Gamboni sent to Mr Opie a detailed restructure proposal to integrate the Unit into the Business Banking Unit of the Bank and to abolish his position of Senior Manager, Property Finance. The restructure proposal contemplated that Mr Myers would leave the Unit and that Mr Pinner would return to the Unit to manage its commercial property loan portfolio as part of the Business Banking Unit, with the assistance of Mr Cail.
Mr Opie discussed Mr Gamboni’s restructure proposal with senior bankers, including Phil Whiting. Mr Whiting was the Bank’s Regional Manager for Region 340[2] and he reported to Tim Rodda, the Bank’s Area Manager, Regional Victoria. Mr Opie reported to Russell Jenkins, the Chief General Manager, Retail and Distribution.
[2]Region 340 was based in Bendigo.
On 27 March 2009, Mr Opie emailed Russell Jenkins and made recommendations about the Unit, namely, that:
(a) the Unit be incorporated into the Bank’s Bendigo based Business Banking Unit;
(b) a portion of the Unit’s portfolio be reallocated to other business banking portfolios in the Melbourne region, with the major portion being retained by the Bendigo Business Banking Unit;[3]
[3]In evidence, Mr Opie explained that the major portion was that part of the portfolio that had been referred by Mr Fixler.
(c) Mr Myers take over the Business Banking Manager position until then held by a Nathan Jenkins;
(d) Mr Pinner return from leave and manage ‘what remains of the former property finance unit’; and
(e) Mr Gamboni’s position be made redundant, resulting in the saving of a full-time employee position.
In his email to Russell Jenkins, Mr Opie stated that Sandhurst had amended its lending policy, that the Unit could no longer transact with Sandhurst and that all future funding opportunities would need to be considered via the Bank. Mr Opie emphasised that a positive feature of the restructure was that the Bank would be able to offer a full range of business banking facilities to the Unit’s customers. Mr Opie’s email concluded: ‘This restructure is seen as a very positive move and is supported by all involved.’
Mike Hirst, who became the Bank’s managing director, decided not to approve a redundancy payment for Mr Gamboni. Mr Gamboni was informed of this decision on about 3 April 2009.
On 9 April 2009, Mr Opie advised Mr Gamboni that the restructure proposal was being implemented in all respects apart from his redundancy.
Mr Gamboni applied for a period of extended leave to commence after Mr Opie left the Bank. The application was approved by Russell Jenkins on 17 April 2009. Russell Jenkins informed Mr Opie that the application was approved ‘on the understanding that when [Mr Gamboni] returns … it will be to a Business Banking position.’ Mr Gamboni was informed of this understanding. He protested that he was not a business banker and stated that he expected to have the same role when he returned from leave.
On 24 April 2009, Mr Whiting informed Mr Opie by email that he was happy for Mr Gamboni to manage his current portfolio when he returned from leave and that the clients and work would be substantially the same. Mr Whiting added that Mr Gamboni would be given a new business banking title. Mr Opie forwarded Mr Whiting’s email to Mr Gamboni.
On 18 May 2009, Mr Myers took over the Business Banking Manager’s position that was vacated by Nathan Jenkins. He reported to the Senior Manager Business Banking (Region 340), Andrew McGregor.
With effect from 1 July 2009, the existing commercial property loan portfolio of the Unit was transferred to the Bank’s Business Banking Unit of Region 340. The Unit ceased to exist as a stand-alone department.
Mr Gamboni continued to manage the commercial property loan portfolio with Mr Cail within the Business Banking Unit of Region 340 until Mr Pinner returned from leave on 3 August 2009. Mr Gamboni reported to Mr Pugh. Mr Gamboni commenced his approved extended leave on 13 August 2009 and was due to return on 18 October 2010. No person occupied the position of Senior Manager, Property Finance or Acting Senior Manager, Property Finance after Mr Gamboni went on leave.
While Mr Gamboni was on leave, Mr Pinner managed the commercial property loan portfolio. He was appointed on a fixed term contract. His formal title was ‘Business Banking Manager’ and he reported to Mr McGregor. Mr McGregor had held the position of Senior Manager Business Banking (Region 340) for six or seven years. There had been only one Senior Manager Business Banking in Region 340. Neither Mr McGregor nor his superior, Mr Whiting, were specialist commercial property bankers.
Mr Whiting sent an email to Mr Pinner on 10 June 2009 in which he commented on Mr Pinner’s fixed term contract. In the email, Mr Whiting stated that the commercial property loan portfolio formed part of the overall business banking business for Region 340 and that it should not be viewed ‘as different to other Business Banking portfolios with the exception of understanding the specific needs of the customer base.’
The position description for the position of Business Banking Manager that Mr Pinner occupied relevantly provided:
Organisational and Position Overview
Organisational
The Retail & Distribution Division is the customer facing arm of the Retail Bank, encompassing branch banking, financial planning, business banking and community engagement.
…
Position
The Business Banking Manager will play a leadership role in the long-term development of the local business community and will require a detailed knowledge of the commercial and SME markets to establish and implement strategies to achieve growth of their portfolio. The ability to establish and maintain quality referral networks will be critical to ensure the continued growth of their portfolio. By proactively servicing these needs the Business Banking Manager will establish and maintain sustainable relationships. The Business Banking Manager will also assist in the development of support staff.
The position’s key focus is to develop and manage a high value, low credit risk business portfolio by building a vigorous two-way referral partnership with ‘buddy’ branches. The Business Banking Manager will have an in depth understanding of the market in which business banking operates.
Key Result Areas (5–8 Areas)
…
· Proactively developing and implementing internal and external business development strategies within the relevant region to achieve business growth and other financial objectives.
…
· Provide financial services (including advice on relevant products and services to suit customer needs as authorised by the Bank by way of an Authorisation to Provide Financial Product Advice).
…
Special Requirements
…
The Business Banking Manager will establish strong relationships with both new and existing customers providing for all their financial needs.
…
Experience required
· Proven track record in business development skills with a focus on small–medium businesses. …
The position description for the position of Senior Manager, Business Banking[4] relevantly provided:
[4]The position was also known as Senior Business Banking Manager.
Organisational and Position Overview
Organisational
The Retail & Distribution Division is the customer facing arm of the Retail Bank, encompassing branch banking, financial planning, business banking and community engagement.
…
Position
The Senior Business Banking Manager (SBBM) will have set business targets and is required to lead a team of Business Banking Managers to meet these targets – both on an individual and team level. To achieve growth of portfolios a detailed knowledge of the commercial and SME markets to establish and implement strategies is required. The ability to establish and maintain quality referral networks will be critical to ensure the continued growth of individual and the team’s portfolios.
Reporting to the Regional Manager the position’s key focus is to develop and manage a team where each individual has a high value, low credit risk business portfolio which is built on a vigorous two-way referral partnership with ‘buddy’ branches. The SBBM will have an in depth understanding of the market in which business banking operates.
Key Result Areas (5-8 Areas)
· The overall management and leadership of a team of business bankers including responsibility for achieving individual & team business targets.
· Sales leadership, training, development and mentoring of the Business Banking team as well as Branch and support staff.
· Managing and developing an existing portfolio of business customer relationships.
…
· Assisting branches to achieve business-lending targets.
· Provide financial services (including advice on relevant products and services to suit customer needs as authorised by the Bank by way of an Authorisation to Provide Financial Product Advice).
…
Experience required
· Proven track record in business development skills with a focus on small–medium businesses. …
(c) The termination of Mr Gamboni’s employment in October 2010
On 9 August 2010, Mr Rodda met with Mr Gamboni and asked him whether he was returning to work. Mr Gamboni replied that he wanted the Bank to honour the redundancy.
On 12 September 2010, Mr Rodda sent an email to two senior officers of the Bank. In the email, Mr Rodda acknowledged that Mr Gamboni was very reluctant to resume working at the Bank. Mr Rodda stated that Region 340 was not keen to see Mr Gamboni back; that a return to work by Mr Gamboni would result in Mr Pinner losing his position; and that Mr Pinner was much more valuable to the Bank than Mr Gamboni due to Mr Gamboni’s state of mind.
On 17 September 2010, Mr Rodda telephoned Mr Gamboni and offered him $75,000 ‘all up’ if he agreed not to return to work. Mr Gamboni sent an email to Mr Rodda in which he rejected the offer and stated that he would be returning to his ‘old position as of 18/10/10.’
On 30 September 2010, Mr Rodda sent an email to Mr Gamboni setting out an offer to pay him $75,000 as an eligible termination payment. The email concluded:
In your email [dated 17 September 2010] you have confirmed that you will now be returning to the Bank on 18th October 2010. A letter of offer confirming this date, your reporting line and the performance expectations of you in this role will be provided to you.
On 13 October 2010, Mr Gamboni sent an email to Mr Rodda requesting a copy of the proposed new letter of offer. Mr Rodda responded by email on the same day in which he stated:
I was mistaken in my last email, I thought payroll would need a letter of offer to trigger your system access but they informed me that this is not needed. With your return on [the] same salary and job title there is no need for a new letter.
On 14 October 2010, Mr Gamboni’s solicitor wrote to the Bank asserting that Mr Gamboni’s position had been made redundant. Mr Gamboni did not resume work at the Bank at the conclusion of his extended leave on 18 October 2010. By letter dated 26 October 2010 to Mr Gamboni’s solicitor, the Bank asserted that, by failing to return to work, Mr Gamboni had abandoned his employment.
At no stage was Mr Gamboni provided with a written offer regarding his employment with the Bank at the conclusion of his extended leave. While it was contemplated by the Bank that Mr Gamboni would be given the new title of Senior Manager, Business Banking, he was never offered that position. Although Mr Pinner and Mr Myers received letters of offer regarding their new positions after the reorganisation, Mr Gamboni did not receive such a letter. Other than being indirectly informed that he would continue to manage the commercial property loan portfolio if he returned to work,[5] Mr Gamboni was not provided with any document setting out his title, the precise duties of his role or the performance expectations of the role. Although it appears that the Bank contemplated that Mr Gamboni would report to Mr Rodda,[6] Mr Gamboni was never informed of whom he would report to if he returned to work.
[5]See above, [28].
[6]Reference to this proposed reporting arrangement was made in an email from Mr Rodda to Mr Penno dated 29 September 2010.
Principles relating to redundancy
The term ‘redundancy’ must be construed in ‘the context in which it appears.’[7] It is implicit in the authorities that, where the term ‘redundant’ or ‘redundancy’ has been defined in a policy, agreement or industrial award, courts must be guided by that definition rather than by any common law meaning.[8] The discussion of the cases below should be viewed in that light.
[7]Dibbv Commissioner of Taxation (2004) 136 FCR 388, 403 [38] (‘Dibb’).
[8]See, eg, Whittakerv Unisys Australia Pty Ltd (2010) 26 VR 668, 685–6 [93]–[95], 696–7 [158]–[162] (‘Whittaker’); Commonwealth Bank of Australia v Finance Sector Union of Australia 125 FCR 9, 28–9 [27]–[28] (‘FSU’); Amcor Ltd v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241, 246 [2], 249–50 [14], 258 [50] (‘Amcor’); Foster’s Group Ltd v Wing (2005) 148 IR 224, 233 [36] (‘Foster’s Group’).
In Foster’s Group Ltd v Wing,[9] Habersberger AJA reviewed the authorities and stated that the ‘critical question is whether through no fault of the employee his or her role no longer exists or the duties have so changed that for all practical purposes the original role no longer exists.’[10] The ‘critical question’ identified by Habersberger AJA reflected the definition of redundancy in the contract under consideration in Foster’s Group. His Honour went on to state that, where a reorganisation occurs within a workplace, it is necessary to consider what changes, if any, have been made to the role previously performed by the relevant employee as a result of that reorganisation.[11]
[9](2005) 148 IR 224.
[10]Foster’s Group (2005) 148 IR 224, 233 [36].
[11]Foster’s Group (2005) 148 IR 224, 236 [47].
In Jones v Department of Energy and Minerals,[12] Ryan J cited the following definition of redundancy: ‘a job becomes redundant when an employer no longer desires to have it performed by anyone.’[13] His Honour stated that a ‘job’ in that sense refers to a collection of functions, duties and responsibilities entrusted, as part of the scheme of the employer’s organisation, to a particular employee.[14]
[12](1995) 60 IR 304 (‘Jones’).
[13]Jones (1995) 60 IR 304, 308, citing R v Industrial Commission of South Australia; Ex parte Adelaide Milk Co‑operative Ltd (1977) 44 SAIR 1202, 1205.
[14]Jones (1995) 60 IR 304, 308.
In Dibb v Commissioner of Taxation,[15] the Full Court of the Federal Court found that a job, described by reference to its duties as previously performed by the appellant, no longer existed. The relevant work was to be differently distributed such that there was no job for which the appellant’s skills qualified him, resulting in a genuine redundancy.[16] The Court stated that there is no principle that, if any aspect of an employee’s duties is still to be performed by somebody, he or she cannot be redundant.[17]
[15](2004) 136 FCR 388.
[16]Dibb (2004) 136 FCR 388, 405 [44].
[17]Dibb (2004) 136 FCR 388, 404 [41].
In Whittaker v Unisys Australia Pty Ltd,[18] the relevant policy defined redundancy by reference to what happened to a ‘position’. Ross J found that the elements that made up the appellant’s role were redistributed between the appellant and another employee, such that the functions, duties and responsibilities of the position were still required to be performed. His Honour also held that the role of the appellant did not cease to exist merely because the work had been reorganised. Rather, the position of the appellant continued to exist, but was performed by the other employee.[19]
[18](2010) 26 VR 668.
[19]Whittaker (2010) 26 VR 668, 686–7 [95]–[100], 696–7 [159]–[162].
In Amcor Ltd v Construction, Forestry, Mining and Energy Union,[20] the High Court found that the positions of employees who continued to do the same work, on the same terms and conditions as before, and with their accrued entitlements preserved, were not redundant, notwithstanding a change in the legal entity which employed them.[21] However, a change in the terms and conditions or in the tasks to be undertaken by an employee may raise a question as to whether a position continues.[22]
[20](2005) 222 CLR 241.
[21]Amcor (2005) 222 CLR 241, 249 [14], 260 [57].
[22]Amcor (2005) 222 CLR 241, 258 [52].
In Commonwealth Bank of Australia v Finance Sector Union of Australia[23] the Full Court of the Federal Court considered the redundancy provisions of an industrial award. The Court accepted that there may be circumstances in which a nominal position remains in place, but the duties are substantially altered such that the position is made redundant. The Court found that the formal abolition of a position will not amount to a position redundancy unless the change in duties is ‘substantial enough to amount to a change of position.’[24] However, there is no room for the application of that principle where the duties remain, in substance, the same.[25] Accordingly, an examination of the substance of the duties performed is necessary.
[23](2002) 125 FCR 9.
[24]FSU (2002) 125 FCR 9, 28 [27].
[25]FSU (2002) 125 FCR 9, 28 [27].
The meaning of ‘a major portion’ of work in the context of an industrial agreement was considered in Hawkins v Commonwealth Bank of Australia[26] by Moore J of the Industrial Relations Court of Australia. His Honour stated that the expression ‘a major portion’ does not invite a crude comparison of time spent on particular tasks or the determination of a mathematical majority, concluding instead that it is a reference to a ‘significant portion or part of the duties.’[27] After analysing the duties performed by the appellant in his original position and his new position under the new structure, Moore J found that:
In the present case, the position assumed by Hawkins had very few of the managerial functions that constituted a significant part of the duties of the position he formerly occupied. It involved a significant change in the duties that were, in my opinion, material. They constituted the loss of a major portion of the work performed by Hawkins in the position of head of institutional banking, South Australia. He was thus involved in a position redundancy.[28]
[26](1996) 66 IR 322 (‘Hawkins’).
[27]Hawkins (1996) 66 IR 322, 337.
[28]Hawkins (1996) 66 IR 322, 337.
This finding was upheld on appeal, where the Full Court of the Industrial Relations Court of Australia found that when applying the definition of redundancy in the industrial agreement, the question was not whether Mr Hawkins personally had become redundant to the requirements of his employer, but whether the position which he formerly occupied had become redundant.[29] Whether or not the employee would be fully occupied in work of importance to the employer was not determinative. The Court stated that:
The new position was to have none of the personnel functions of the old position. [Mr Hawkins] would no longer be responsible for managing a large group of employees of the Bank. He would have no direct managerial role in relation to the Treasury Department and International Trade. His role in credit assessment was to become indirect and collaborative rather than direct.[30]
[29]Hawkins v Commonwealth Bank of Australia [No 2] (1996) 70 IR 213, 226 (‘Hawkins [No 2]’).
[30]Hawkins [No 2] (1996) 70 IR 213, 226.
In the context of the phrase ‘work (or a major portion of it) … is no longer required’, the word ‘required’ means ‘demanded or called upon or enjoined.’[31]
[31]FSU (2002) 125 FCR 9, 28 [27].
Decision below
The trial judge identified the legal question to be decided by him as ‘whether the work being done or position being held by Mr Gamboni, or a major portion of it, was no longer required for one of the prescribed reasons’.[32] By ‘prescribed reasons’, his Honour meant one of the five alternative requirements set out in the definition of ‘redundancy’ in the Policy.[33] The trial judge decided that requirements (c) and (d), and possibly (a), had been satisfied. His Honour found as follows:
90It is clear that the restructure that occurred in 2009 is properly described as a reorganisation within paragraph (c) of the definition of redundancy and also a change in business or management practices within paragraph (d). It may also come within paragraph a. as resulting from changes in economic or business conditions.[34]
Neither party has sought to impugn the above finding.
[32]Reasons, [70].
[33]The five requirements are set out above, [6].
[34]Reasons, [90].
The trial judge found that ‘from about the start of July 2009, the Commercial Property Unit was abolished and its activities transferred to the Business Banking stream.’[35]
[35]Reasons, [91].
The trial judge then considered whether the work being done by Mr Gamboni, or a major portion of it, was no longer required after the reorganisation and concluded that Mr Gamboni had not satisfied this requirement. His Honour’s reasons for his conclusion were as follows:
92I find that Mr Pinner took over the role of managing Mr Gamboni’s clients in his absence. The Bank expected that Mr Gamboni would return to the position, with a new reporting line to reflect the fact the property finance team, or unit was brought within Region 340.
93I find that Mr Gamboni was able to return to work at the Bank with the pay and conditions of a Senior Manager with the task of looking after his portfolio of commercial borrowers. His job would have been placed in the Business Banking stream, but probably reporting to Mr Rodda. I do not consider that the records to which Mr True referred alter this conclusion. The evidence of Mr Whiting and Mr Rodda is of greater significance.
94It is probable that he would have one other staff member to mentor. It is probable that funds would have been available to provide loans to his clients. This was Mr Pinner’s experience.
95 I apply these findings to the terms of the Redundancy Policy.
96 Mr Gamboni bears the onus of proof of establishing his claim.
97The definition of redundancy operates to confer a redundancy benefit under the policy in either of two circumstances, one in relation to work and one in relation to position. The question is whether the work being done by Mr Gamboni, or the position held by him, or a major portion of it, was no longer required. The clause is widely drawn operating both in respect of work and position.
98It has not been established that the work being done by Mr Gamboni, or a major portion of it, was no longer required.
99The evidence of the Bank witnesses to which I have referred made it clear that Mr Gamboni could have returned to work in the Business Banking Unit under the title of Senior Manager, looking after his old portfolio with the assistance of Mr Cail. It is clear that some senior managers preferred that not to occur and were happy with Mr Pinner carrying out his duties. However, that does not establish that Mr Gamboni’s work, or a major portion of it, was no longer required.[36]
[36]Reasons, [92]–[99].
The trial judge then considered whether Mr Gamboni had established that his position of Senior Manager, Property Finance, or a major portion of it, was no longer required. His Honour concluded that Mr Gamboni had not satisfied this requirement, for the following reasons:
101The term ‘position’ when used in employment contracts, as has been said, is not a term of art. To understand its meaning requires the paying of particular attention to the functions, duties and responsibilities of the particular position.
102The position involved was identified in the Position Description as Senior Manager Property Finance. I have set out previously the duties of that position. They were largely associated with the development of the work of the Property Finance Unit, more particularly the interests of the clients. The Position Description stated that the position’s key focus was in essence the development and management of the particular business portfolio.
103The Unit was abolished because of a restructure and therefore the role of heading that Unit ceased. However the main part of the duties associated with looking after the customers was to continue. The number of employees was reduced to two. Loan funds from Sandhurst Trustees [ceased],[37] but the evidence of Mr Pinner suggests that funds became available from other sources.
104Consideration is required of the duties of the two positions: the position of Senior Manager Property Finance, when it operated in a separate Unit and what is known of the position that would have been available to Mr Gamboni if he returned.
105I am not persuaded that a major portion of Mr Gamboni’s position no longer existed because of the abolition of the Commercial Property Unit. The Unit, in essence, had been three employees under the leadership of Mr Gamboni looking after and developing the client base of the portfolio. Although the number of employees was reduced by one, the customers remained and the mentoring of the other employee would still have been required.
106While it is true that the details of the position to which Mr Gamboni had not been all worked out the evidence establishes that he would have returned to a Senior Manager’s position looking after much the same portfolio of clients and with the assistance of, and responsibility [for] one other employee.
107No job description existed of the new role of a second Senior Banking Manager in the Business Banking Section. This was in part because Mr Gamboni had gone on leave. Mr Pinner’s evidence gives some detail of the work that was available. It seems clear that the work involved providing services to the existing customers.[38]
[37]The parties agreed that the word ‘ceased’ was erroneously omitted from the Reasons.
[38]Reasons, [101]–[107].
The trial judge did not address the question of whether the position of Senior Manager in the Business Banking Unit was a ‘suitable alternative position’ for Mr Gamboni within the meaning of the Policy.[39] This was because the parties’ submissions paid ‘[l]ittle attention’ to that provision of the Policy.[40]
[39]See above, [6].
[40]Reasons, [109].
Notice of appeal and notice of contention
Mr Gamboni’s notice of appeal sets out six grounds of appeal. In substance, those grounds allege that:
(a) the trial judge misconstrued the provisions of the Policy concerning whether the work being done by Mr Gamboni or the position held by him, or a major portion of them, were no longer required after the reorganisation;
(b) in particular, the trial judge conflated the work being done by Mr Gamboni and the position held by him and thereby failed to give any proper consideration to whether the major portion of his position was no longer required after the reorganisation; and
(c) the evidence required his Honour to conclude that a major portion of the work performed by Mr Gamboni was no longer required after the reorganisation, and that a major portion of the position held by Mr Gamboni was no longer required after the reorganisation.
The Bank’s notice of contention sought to uphold the trial judge’s decision on the following two grounds:
(a) his Honour erred in concluding that the Unit was abolished at the start of July 2009; and
(b) his Honour erred in failing to decide that, even if Mr Gamboni’s position was redundant, a suitable alternative position was available.
Was a major portion of Mr Gamboni’s work no longer required?
Mr Gamboni submitted that the trial judge erred by confining his consideration to the narrow question of whether Mr Gamboni would continue to manage the same portfolio of commercial property loan customers after the reorganisation, rather than analysing the nature and scope of the duties he would be required to perform after that time. He contended that the duties substantially changed, both qualitatively and quantitatively, because the portfolio of commercial property loan customers had shrunk and there was no longer scope for developing or growing the portfolio, which had been a key focus of his job description as Senior Manager, Property Finance.
Mr Gamboni emphasised the fact that the Bank had at no time provided him with a written description of the duties that he would have been required to perform if he had returned to work at the end of his extended leave. According to Mr Gamboni, even if it is assumed that he would have been required to perform the duties set out in the job description for Senior Manager, Business Banking, he was not suited for that position. This was because, so it was said, his skills were confined to making commercial property loans using Sandhurst’s lending policies, and he lacked general banking experience.
The Bank submitted that the trial judge had correctly found that, after the reorganisation, Mr Gamboni would be required to perform the same type of work for the same commercial property customer portfolio and therefore a major portion of the work would be required after the reorganisation. The Bank relied on printouts of the commercial property customer portfolio as at 31 March 2009, 31 July 2009, 31 August 2009, 30 September 2009 and 31 October 2010, which showed that the number of customers and loan accounts had initially remained steady and then increased over that period.
In my opinion, the trial judge erred in his construction of the Policy and its application to the evidence in relation to the question of whether a major portion of the pre-reorganisation work that Mr Gamboni performed was required after the reorganisation. In particular, I differ from his Honour in my analysis of the attributes of that work, the extent to which those attributes survived the reorganisation and whether the reorganisation required Mr Gamboni to perform entirely different work to which he was not qualified or suited.
Mr Gamboni’s pre-reorganisation work had the following attributes:
(a) The work was almost exclusively the making of commercial property loans sourced from Sandhurst’s common funds and provided solely on the security of first mortgages over commercial property.
(b) The customers to whom services were provided were companies operating in the commercial property market. Most of the companies were owned by Jewish business people who were referred to the Unit by Mr Fixler.
(c) The work involved transactions that were governed by Sandhurst’s lending policies which in turn were governed by the Trustee Act.
(d) The work was performed by the Unit as a stand-alone department comprising Mr Gamboni as the senior manager, a manager and a lending officer.
(e) As the senior manager of the Unit, Mr Gamboni’s ‘key focus [was] to develop and manage a high value, low credit risk business portfolio by building vigorous referral partnerships with the major introducers and customers which equate to the top 20% of [the] customer base by number & 70% of [the] customer base by value.’
(f) Mr Gamboni’s work as senior manager also included: mentoring and monitoring of the manager of the Unit in his control and management of the balance of the portfolio, that is 80 per cent of the customer base by number and 30 per cent of the customer base by value; and assisting the manager to further develop his skills by ‘delegating, prioritising & mentoring his business activities.’
(g) Mr Gamboni’s position description required him to have ‘a sound knowledge of the commercial property market to establish and implement strategies to achieve growth of [the] portfolio.’
(h) Mr Gamboni was the head of a separate business unit and had budgeting and other responsibilities in that capacity.
After the reorganisation, the above attributes did not apply at all to the work that Mr Gamboni was required to perform or applied in a materially different manner.
In relation to (a), following the reorganisation, loans could no longer be funded from Sandhurst’s common funds. Although some alternative sources of funds were found for the commercial property loan portfolio, it appears that those funds were sourced through the Bank and that the Banking Act, rather than the Trustee Act, applied. It is unlikely that security for funds provided by the Bank would be confined to first commercial property mortgages. While it was likely that Mr Gamboni’s new title would be Senior Manager, Business Banking, it is not clear whether the position description associated with that title would apply to him. This uncertainty makes it difficult to accurately compare the attributes of Mr Gamboni’s pre-reorganisation role with the proposed post-reorganisation role. It is apparent, however, that if the position description for the Senior Manager, Business Banking position were made applicable to Mr Gamboni, his work would not be confined to commercial property loans but would entail other business banking responsibilities. The scope of the duties of a Senior Manager, Business Banking is discussed further at [74] below.
In relation to (b), following the reorganisation, Mr Gamboni would have been required to continue to provide services to companies operating in the commercial property market, including companies that were referred by Mr Fixler. However, for the reasons discussed at [66] above and [74] below, the services would not be confined to companies operating in the commercial property market.
In relation to (c), after the reorganisation, the work did not involve any new transactions that were governed by Sandhurst’s lending policies or by the Trustee Act.
In relation to (d), after the reorganisation, the work was no longer performed within a stand-alone department comprising Mr Gamboni as the senior manager, a manager and a lending officer. The Unit was absorbed within the Business Banking Unit of Region 340. During Mr Gamboni’s extended leave, the work was performed by Mr Pinner as manager and Mr Cail as lending officer. It was contemplated that upon Mr Gamboni’s return from extended leave, Mr Pinner would no longer continue in his role as manager, so that the work would be performed by Mr Gamboni and Mr Cail. As Mr Cail performed the ‘rats and mice work’,[41] Mr Gamboni would need to perform the lower status work that Mr Pinner performed. The function of monitoring and mentoring Mr Pinner — which Mr Gamboni described in evidence as ‘a major part of [his] role’ — would no longer be performed by him.
[41]See above, [18].
In relation to (e), the trial judge found that, after the reorganisation, Mr Gamboni would be able to continue to ‘manage’ the commercial property loan portfolio. However, under the position description for Senior Manager, Property Finance, the ‘key focus’ included developing and expanding the portfolio rather than simply managing it. Further, another key focus was concentration on the top 20 per cent of the customer base by number and 70 per cent of the customer base by value, leaving it to the manager to look after the balance of the portfolio. After the reorganisation, Mr Gamboni would not have access to the same sources of funds with which to develop the portfolio and, without a manager to assist him, he would not be able to concentrate on the major customers but would have to devote his time to all the customers.
In relation to (f), Mr Gamboni would not be able to perform his pre-reorganisation work of mentoring and monitoring a manager and assisting the manager ‘to further develop his skills by delegating, prioritising & mentoring his business activities.’ This was because Mr Gamboni would no longer be assisted by a manager.
In relation to (g), it is not clear whether, had Mr Gamboni returned from leave, the position description for the position of Senior Manager Business Banking would have applied to him as a consequence of the reorganisation. If that position description became applicable, Mr Gamboni would not be able to focus only on having a sound knowledge of the commercial property market to achieve growth in the portfolio, but he would be required to possess business banking skills. This clearly emerges from a comparison of the position description for the Senior Manager, Property Finance set out at [14] above with the position description for the Senior Manager, Business Banking set out at [35] above.
In relation to (h), after the reorganisation, Mr Gamboni would no longer be the head of a separate business unit and would cease to perform any work — such as preparing budgets — that was associated with that capacity.
The work and skills set out in the position description for the position of Senior Manager, Business Banking include: ‘lead a team of business banking managers’; ‘[have] detailed knowledge of the commercial and SME[42] markets’; ‘sales leadership, training, development and mentoring of the Business Banking team as well as branch and support staff’; ‘[a]ssisting branches to achieve business lending targets’; and ‘[providing] financial services’. In the light of the fact that Mr Gamboni did not have any business banking experience and had served only the commercial property market, it is difficult to see how he could be expected to perform some of these functions himself or supervise their performance by other staff. This is particularly important in relation to the function of providing financial product advice under an authorisation from the Bank. As Mr Gamboni had not had any relevant training, he was not qualified to perform that function.
[42]Small and Medium Enterprises.
Prior to the reorganisation, Mr Gamboni worked with two subordinates. While he was responsible for monitoring and mentoring both of them, the primary focus of the monitoring and mentoring was the Manager, Property Finance. By contrast, the work performed by the Senior Manager, Business Banking involved supervising a potentially large number of personnel, including at branch level.
The role performed by Mr Pinner as Manager, Business Banking during the 14 months that Mr Gamboni was on extended leave supports the conclusion set out at [72] above. Mr Pinner had business banking expertise and, as appears from [34] above, his position description included business banking functions. Judging from Mr Rodda’s email dated 12 September 2010 to two senior officers of the Bank, the Bank was happy with Mr Pinner’s management of the commercial property loan portfolio and would have preferred for him to continue managing it rather than for Mr Gamboni to resume working for the Bank. These facts indicate that the nature of the portfolio and the work required to manage it were such that the role of a senior manager was no longer required.
The Bank submitted that the fact that the Bank had covered Mr Gamboni’s position as senior manager with a manager rather than an acting senior manager, cannot give rise to an inference that the work no longer required a senior manager or that the position of senior manager was redundant. The Bank contended that, as a business organisation, it was entitled to decide how to allocate its resources, including whether to retain a senior manager to manage the portfolio. According to the Bank, it is not the Court’s function to second-guess the Bank’s business decisions about whether particular work or positions continue to be required. Assuming that these submissions are correct, they do not advance the Bank’s case very far. It is the Court’s role to decide whether Mr Gamboni has satisfied the requirements of the Policy. What is important for present purposes is that the facts set out at [76] above, viewed objectively, are entirely consistent with the proposition that the major portion of Mr Gamboni’s pre-reorganisation work was, in substance, no longer required after the reorganisation.
The Bank also submitted that whether the major portion of Mr Gamboni’s pre-reorganisation work was required after the reorganisation cannot be determined by reference to the changes in the sources of funds for commercial property customers or the nature of the financial products that Mr Gamboni would be required to manage after the reorganisation. The Bank contended that, even though funding from Sandhurst’s common funds had dried up as a result of the GFC, after the reorganisation, alternative funds were sourced for the commercial property loan portfolio and other financial products became available for customers within that portfolio. According to the Bank, this enabled the portfolio to remain steady and even to expand.
Accepting, for present purposes, that the matters set out at [78] above are correct, they do not assist the Bank’s case very much. This is because those matters cannot be viewed in isolation but must be considered in the context of all the other matters discussed at [64] to [76] above. The Bank’s submission fails to give any weight to the reality that, prior to the GFC and the resulting reorganisation, the defining features of the work performed by Mr Gamboni within the Unit included:
(a) the provision of funding almost exclusively to the commercial property market;
(b) there was a single portfolio, namely, the commercial property loan portfolio;
(c) the funding was sourced from Sandhurst’s common funds in accordance with the lending policies of Sandhurst, consistent with the Trustee Act; and
(d) the loans were secured only by first mortgages over commercial property.
These defining features did not survive the reorganisation. While a commercial property loan portfolio remained, its composition and sources of funds had changed and it was no longer viewed as being different from other business banking portfolios.[43] Significantly, if the job description of Senior Manager, Business Banking were made applicable to Mr Gamboni, his work would not be confined to that portfolio. Rather, he would also have responsibility for other portfolios in other markets, including the commercial and small and medium enterprises markets. He would need to learn about those markets, the different forms of security that the Bank utilised in those markets and the different regulatory regime under the Banking Act.
[43]See Mr Whiting’s email to Mr Pinner dated 10 June 2009, which is discussed above, [33].
The Bank relied on the fact that, under cl 3 of Mr Gamboni’s contract of employment, the Bank had the power to significantly vary his role, levels of responsibility, reporting lines and duties. However, that is not determinative. That is because, as the Policy formed part of the contract of employment, the question is whether, in the light of the changes that the Bank had made, Mr Gamboni has satisfied the requirements of the Policy.
For the above reasons, when the attributes of the work that Mr Gamboni was required to perform prior to the reorganisation are compared with the attributes of the post-reorganisation work, the evidence overwhelmingly points to the conclusion that, in substance, the major portion of the pre-reorganisation work was not required after the reorganisation. The trial judge erred by confining his analysis to whether ‘the task of looking after [Mr Gamboni’s] portfolio of commercial borrowers’[44] continued to be required after the reorganisation.
[44]Reasons, [93], [99].
It follows that Mr Gamboni has satisfied one of the alternative bases for qualifying for a redundancy payment under the Policy.
In case my conclusion at [83] above is wrong, I will now consider whether Mr Gamboni satisfied the alternative basis for qualifying for a redundancy payment under the Policy, namely, that the major portion of his pre-reorganisation position was not required after the reorganisation.
Was a major portion of Mr Gamboni’s position no longer required?
Mr Gamboni submitted that the trial judge failed to properly consider whether the major portion of his pre-reorganisation position was required after the reorganisation because his Honour inappropriately conflated the concepts of work and position. Mr Gamboni contended that important features of his pre-reorganisation position did not survive the reorganisation. Those features included, so it was said, the nature of the work that Mr Gamboni was required to perform, the title, the reporting lines and the level of autonomy and responsibility.
The Bank submitted that, after the reorganisation, Mr Gamboni retained his salary and status as a senior manager and was required to perform essentially the same work. It followed, so it was said, that the major portion of Mr Gamboni’s pre-reorganisation position was still required.
I agree with Mr Gamboni’s submission that the trial judge conflated the concepts of work and position and failed to adequately consider as a separate question whether the major portion of Mr Gamboni’s pre-reorganisation position remained after the reorganisation.
The concept of ‘position’ in the present context includes at least the following features:
(a) the nature of the work attached to the position;
(b) the title that is associated with the position;
(c) the status and seniority of the position;
(d) the reporting lines associated with the position, including the number and seniority of the persons reporting to that position and the seniority of the superiors to whom that position reports; and
(e) the level of autonomy associated with the position.
The trial judge focused primarily on (a) and (b) above. But, when the other matters are considered in the light of the evidence, the conclusion to which I have come is that the major portion of Mr Gamboni’s pre-reorganisation position was not required after the reorganisation.
In relation to (a), for the reasons discussed at [63] to [83] above, the major portion of Mr Gamboni’s pre-reorganisation work was not required after the reorganisation.
In relation to (b), the reorganisation resulted in the abolition of the title Senior Manager, Property Finance. While it was likely that Mr Gamboni would have held the title of Senior Manager, Business Banking, for the reasons set out at [74] above, Mr Gamboni was ill-suited to perform the functions associated with this role. There had only been one Senior Manager, Business Banking in Region 340. The Bank failed to adequately explain the role to be performed by Mr Gamboni as a second Senior Manager, Business Banking for that Region and how the two positions would interact.
In relation to (c), at no stage were the status and seniority of Mr Gamboni’s proposed position of Senior Manager, Business Banking articulated by the Bank. In particular, the Bank did not articulate whether the position that Mr Gamboni was to occupy would have exactly the same status and seniority as the incumbent Senior Manager, Business Banking of Region 340 (Mr McGregor). It was clear, however, that Mr Gamboni would no longer be the head of a separate business unit and would no longer have the status or the responsibilities associated with such a position.
In relation to (d), while the reporting lines to Mr Gamboni’s proposed position of Senior Manager, Business Banking were finalised, the reporting lines from that position were not finalised.
Prior to the reorganisation, a manager and a lending officer reported to Mr Gamboni whereas, after the reorganisation, only a lending officer would report to him. Generally speaking, the number of persons reporting to a position and their seniority have a bearing on the status of that position. While a reduction of a single person may not appear significant in absolute terms, in the present case it represented a 50 per cent reduction in the number of Mr Gamboni’s subordinates. It also represented a loss of the most senior staff member. This loss not only indicated a diminution in the status of Mr Gamboni’s position, it also affected the quality of the work that he would be able to perform. Instead of mentoring and supervising a manager who would be able to look after 80 per cent of the commercial property loan portfolio, after the reorganisation, Mr Gamboni would only be able to mentor a lending officer and would be required to personally manage the entire commercial property loan portfolio.
The lack of clarity about the position to which Mr Gamboni would report created considerable uncertainty about the status and seniority of his proposed position as Senior Manager, Business Banking. Prior to the reorganisation, Mr Gamboni reported to a very senior executive, Mr Opie, who was the Chief Manager Lending. Following Mr Opie’s departure, Mr Gamboni reported to Mr Opie’s successor, David Pugh. It is not clear whether, upon his return from extended leave, Mr Gamboni would have reported to Mr Whiting, Mr Rodda or to some other executive.
In relation to (e), prior to the reorganisation, Mr Gamboni headed a stand-alone department with some autonomy concerning business development activities and budgets. Following the reorganisation, the Unit’s commercial property portfolio was absorbed by the Business Banking Unit of Region 340. The attributes of Mr Gamboni’s position that were associated with heading and leading an autonomous department disappeared after the reorganisation.
In my opinion, the discussion at [87] to [96] above inexorably leads to the conclusion that the major portion of Mr Gamboni’s pre-reorganisation position was not required after the reorganisation.
It follows that Mr Gamboni has made out his grounds of appeal. Accordingly, unless the order below can be upheld on the basis of the Bank’s notice of contention, the appeal must be allowed. I now turn to the notice of contention.
Notice of contention — was the Unit abolished?
Mr Gamboni submitted that the trial judge’s conclusion that the Unit was abolished as a result of the reorganisation was correct and was amply supported by the evidence. The Bank, on the other hand, submitted that this conclusion was not open on the evidence because the Unit continued to operate as a specialist unit after it was brought into the Business Banking Unit in Region 340. The Bank emphasised that the commercial property loan portfolio remained intact and continued to be serviced by the Unit.
The Policy does not refer to the abolition of an employee’s business unit as a condition precedent to the employee being eligible for a redundancy payment. Accordingly, even if the trial judge erred in concluding that the Unit was abolished as a result of the reorganisation, that would not necessarily mean that Mr Gamboni’s position had not been made redundant as a result of the reorganisation.
In any event, any discussion of the question of whether the trial judge erred in concluding that the Unit was abolished requires clarification of what his Honour intended to convey. Clearly, his Honour’s use of the word ‘abolished’ did not intend to convey that the work performed by the Unit was terminated in its entirety. His Honour’s reference to the Unit being ‘brought within Region 340’[45] indicates that what he meant by the word abolished was that, as a result of the reorganisation, the Unit ceased to exist as a stand-alone department within the Bank and that its work was absorbed within the Business Banking Unit of Region 340.
[45]Reasons, [92].
In my opinion, the trial judge was correct to use the word abolished in the manner described above. Viewed in that way, the evidence to which I have already referred overwhelmingly supports his Honour’s conclusion that the Unit was abolished as a result of the reorganisation. For the reasons discussed above, the defining features of the work performed by the Unit ceased after the reorganisation.[46]
[46]See above, [64] to [80].
A conclusion that the work of the Unit was not totally eliminated but was absorbed within the Business Banking Unit of Region 340 of the Bank is entirely consistent with Mr Gamboni’s position becoming redundant as a result of the reorganisation in the manner that I have already discussed.
It follows that the Bank has not established any error in his Honour’s conclusion that the Unit was abolished as a result of the reorganisation.
Notice of contention — was a suitable alternative position available?
As discussed at [57] above, the trial judge did not address the question of whether the position of Senior Manager in the Business Banking Unit was a ‘suitable alternative position’ for Mr Gamboni because the parties’ submissions paid ‘[l]ittle attention’ to that provision of the Policy.
Mr Gamboni submitted that, as this issue was not pressed at trial, the Bank should not be permitted to raise it on the appeal. In any event, according to Mr Gamboni, the position of Senior Manager in the Business Banking Unit was not a suitable alternative position because he had not been offered that position, his duties and reporting lines had not been defined and, in any event, he did not have any business banking experience.
The Bank submitted that the issue of the existence of a suitable alternative position was in fact pressed at trial and that the reason that it was not mentioned in the Bank’s closing address was that the trial judge had imposed strict time limits. The Bank contended that the position of Senior Manager in the Business Banking Unit was a suitable alternative position for Mr Gamboni because he would be performing essentially the same work for essentially the same commercial property customers as he did prior to the reorganisation.
In my opinion, for the reasons set out at [64] to [76], [79] to [83] and [88] to [97] above, the position of Senior Manager in the Business Banking Unit of Region 340 was not a suitable alternative position for Mr Gamboni. It follows that the Bank has failed to establish that the order below was correct on the alternative basis that, even if the major portions of Mr Gamboni’s work or position were not required after the reorganisation, a suitable alternative position was available to him after the reorganisation.
Conclusion
For the above reasons, I would allow the appeal.
At trial, Mr Gamboni filed particulars of loss and damage in which he claimed the amount of $187,261.50 plus interest. This Court was informed that this amount was not disputed by the Bank. I would set aside the order below and, in lieu of that order, make an order that the Bank pay to Mr Gamboni the amount of $187,261.50 together with interest on that amount in the agreed sum of $47,566.99.
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