Garabed Tontian v Sigma Industries Pty Limited

[1995] IRCA 310

INDUSTRIAL LAW - TERMINATION OF EMPLOYMENT - UNLAWFUL TERMINATION - REDUNDANCY 

Industrial Relations Act, 1988 Sections 170 EA 170 DE and 170 EE

No 1056 of 1995

GARABED TONTIAN v. SIGMA INDUSTRIES PTY LIMITED

CORAM:  JUDICIAL REGISTRAR LINKENBAGH

PLACE: SYDNEY

DATE: 25 MAY 1995

IN THE INDUSTRIAL RELATIONS COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY      No NI 1056 of 1995

Between    GARABED TONTIAN
   Applicant

and       SIGMA INDUSTRIES PTY LTD
   Respondent

CORAM: LINKENBAGH J.R.  PLACE: SYDNEY
DATE:  25 MAY 1995

REASONS FOR JUDGMENT REVISED FROM THE TRANSCRIPT

This is an application under section 170EA of the Industrial Relations Act 1988 in which the applicant seeks a remedy pursuant to the provisions of section 170EE of the Act arising from the termination of his employment with the respondent. That termination was effective on 23 December 1994. I formally grant the applicant leave to proceed notwithstanding that the application was not filed within the time allowed under the provisions of section 170EA(3) because of the relative shortness of the time in which the filing of the application was late and because the period involved the Christmas break.

The matter proceeded on the basis that the applicant conceded that the termination arose out of a redundancy which was a genuine redundancy and the applicant raised no issue under the provisions of 170DE(1) of the Act.  The applicant's case is essentially that the provisions of 170DE(2) have not been complied with and that section provides that:

A reason for termination is not valid if, having regard to the employee's capacity and conduct and the operational requirements, the termination is harsh, unjust or unreasonable.

The applicant is arguing before me that this termination in all of its circumstances was harsh, unjust or unreasonable.  I note the submissions that have been made in relation to the provisions of schedule 11 to the Act.  Essentially those provisions require that a person being terminated as a result of a redundancy, as is the case here, ought to be able to expect that there would be an objective process.  That process varies with the circumstances of each case and whilst I have been directed to two cases by the representative of the applicant and those cases are certainly of assistance as to the general propositions, ultimately it comes down to the circumstances of the particular redundancy, the particular work place, the particular employer and the particular employee as to whether they add up to circumstances which could be categorised as harsh, unjust or unreasonable. 

The facts of this matter are that the redundancy arose out of a falling off in work for the respondent.  The respondent examined its operational requirements in detail towards the end of 1993 and from that time onwards there was redundancy in the air at this work place.  The applicant was selected for redundancy or targeted for redundancy about January of 1994.  That action was put on hold by the General Manager out of consideration for some particular personal circumstances of the applicant. He was involved in litigation in the Family Court over the custody of his daughter and it was his perception that if he was made redundant his chances before the Family Court would in some way be adversely affected.

The Family Law proceedings were resolved in March of 1994.  The respondent's circumstances did not improve in 1994 and towards the end of 1994 there was a further internal examination which resulted in some decisions having to be taken about the reduction of staff numbers.  One area in which staff numbers were to be reduced was in the area of supervisors. The applicant was one of six supervisors and the number was to be reduced to three.  There was detailed evidence given as to the process that was followed. The company invited the six to volunteer.  Two people volunteered. 

The area of production from which the two volunteers came further reduced the range of available options for selection for the other remaining redundancy. The company needed to ensure that those retained had the necessary skills to meet the needs of the company's production for the foreseeable future.

The process came down to a choice between two men, the applicant and one other.  I find that there was consultation at the time when the volunteers were called for.  I also find that at the meeting on 15 December 1994 there was consultation with the applicant and an explanation given to him as to the reasons for which he was selected to be the third candidate for redundancy.  The degree to which a candidate for redundancy is consulted and counselled throughout the process, must of necessity vary from case to case, and take account of the personalities of the competing candidates.

In this case I have several areas of evidence which indicate something of the personality and attitude and perceptions of the applicant in relation to his employer and his employment generally and I will return to those in a moment.  Before I do that, this is a matter where I need to say something about the relative credibility of the witnesses who have given evidence before me.  The applicant's case was presented by oral evidence from the applicant himself and he called Mr Azzopardi who was his immediate supervisor.  Mr Azzopardi was cross examined. 

The witnesses for the respondent were three persons who were in management positions and who were involved in matters at the work place in 1994.  The respondent also relied to such weight as I am prepared to give it on an affidavit sworn by the former General Manager, Mr Lawes, who is in England and was unavailable for cross examination. 

I am forced by the evidence before me to have reservations about the credibility and motives of the applicant in these proceedings. The essence of his case in relation to section 170 DE (2) is that he was lulled into what might be described as a false sense of security by statements made to him by Mr Lawes and other managers to the effect that his job was secure, that he would always have a job with the company and that he would retire from the company. The applicant gave mixed evidence about whether he felt secure or insecure about his employment. The argument that he presents is based on a view that he was made to feel very secure by management and that management breached its obligations to him by putting the redundancy into effect.

I cannot find on the evidence that there was that degree of security conveyed to the applicant by the respondent during 1994.  Certainly, Mr Lawes preserved his employment until after what has been described as "the custody battle" was over.  Thereafter, at the same time as he maintains that he was led to feel secure about his job, he asked Mr Lawes and other managers on an almost daily basis to assure him that his job was secure and he relies on his evidence about the response to those questions to assert to this court that he was given an understanding that his job was secure by management.  He says that he asked on a daily basis and on a daily basis he was told that his job was secure.  It just does not add up to any satisfactory degree of credibility that he could seriously have believed that a level of commitment had been made by management on which he could rely, particularly as the topic of possible redundancies was live in the workplace.

I note the evidence of all the respondent's witnesses that the company itself, at least since the end of 1994 was in an insecure financial state and it would have been a brave manager who would have made statements to give the applicant the sense of security he asserts before me. 

There were several areas in respect of which I had doubts as to the credibility of the applicant and I do not propose to canvass all of those.  One is the information which was provided to the applicant in relation to the possibility of employment with Kirby Hire.  The respondent gave the applicant a letter, informing him of the possibility of work with this other company and left it to the applicant to follow that up should he wish to do so.  His evidence before me was that he followed that up by making two phone calls.  The response to the first was that the man he asked to speak to was not available and that he was to ring back after Christmas.  His evidence in relation to the second phone call was that he phoned, did not leave his name and did not tell the person whom he telephoned his reason for ringing.

I find that he was not motivated to make any genuine attempt to take up that alternative employment or any other alternative employment.  I note that he has not applied for unemployment benefits and that he has been living from what he described as his son's life savings.  He has not banked the cheque for over $19,000 which was provided to him by the respondent on 23 December 1994.

It is possible, and I find this on the evidence before me, that the applicant is a person whose perceptions of the actions of his employer and others are coloured by his personal beliefs and circumstances.  And equally his actions are motivated by his perceptions.  His attitude in relation to the job with Kirby and his confused perceptions about the motives of the respondent in relation to the repayment of an overpayment of salary indicate that he is a person who could perhaps be said sees things in a very black and white and very personal way.

He perceives that the company owed it to him to maintain him in the position which he had worked in for some time.  He was not receptive to a suggestion that he might retrain at the refrigeration area in the end of 1993.  He is certainly not receptive to any idea that he might have taken up the employment with Kirby Hire. His perception and recollection of the conversations which he had with various persons to do with his retrenchment, and the meetings held at the end of November and on 15 December are, I find, coloured by his personal perceptions.

On an objective view of the actions of the respondent it appears to me that the company has been considerate and generous to the applicant in the past and he has not responded to that consideration in a manner which one might perhaps have expected of an employee of such long standing.  He appears to perceive that the company owes him more than it owes to the other employees.  His arguments that he should somehow retain his employment with this company, that the company should have offered him other jobs, that the company lulled him into a false sense of security, are all perceptions and expectations that he has which are inappropriate and do not take into account that he was only one of many employees in this workplace to each of whom the company owed the same level of consideration.

The applicant's representative asserted that the company should have offered the applicant a position as a storeman.  The company moved a couple of people sideways into the stores area at a salary and position inferior to that held by the applicant.  The company moved those people sideways so as to avoid a redundancy at that level.  It is not reasonable in my view for the applicant to argue that he should have been moved down the ladder and put into the stores position, thereby causing someone else to be made redundant other than himself.  

I find that the real issue in the redundancy involving the applicant was the choice between himself and the other person at his level.  I find that the company took its time over the process, gave consideration to all of the relevant issues, consulted with the workforce and the applicant, and made a decision which was based on a real and genuine evaluation of the qualifications, experience and talents of the two candidates.  In all of the circumstances I cannot find that this termination was harsh, unjust or unreasonable and I therefore dismiss the application.

I certify that this and the preceding three pages are a true copy of my Reasons for Judgment.

Maria Linkenbagh
Judicial Registrar

Dated: 6 July 1995

Representative of the Applicant:         Mr. Glenn Bacic  CEPU

Solicitor for the Respondent:            Ms Sarah Bower
  Cutler Hughes and Harris