GCo Electrical Pty Ltd

[2018] FWC 4342

[2018] FWC 4342

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.120—Redundancy pay

GCo Electrical Pty Ltd
(C2018/3372)

DEPUTY PRESIDENT BINET PERTH, 31 AUGUST 2018

Variation of redundancy pay – other acceptable employment.

[1] On 20 June 2018, GCo Electrical Pty Ltd (GCo) applied (Application) to the Fair Work Commission (FWC) for an order (Order) pursuant to section 120 of the Fair Work Act 2009 (Cth) (FW Act) to vary the amount of redundancy pay to be paid to Ms Melissa Smith (Ms Smith).

[2] GCo sought an Order that the amount of redundancy pay be reduced to nil on the basis they have obtained other acceptable employment for Ms Smith.

[3] On 22 June 2018, directions were issued to all parties (Directions), directing Ms Smith to advise the FWC whether she objected to the order sought. On 25 June 2018, Ms Smith advised the FWC that she objected to the Order sought by GCo.

[4] The Directions stipulated that if Ms Smith objected to the Order, GCo would be required to file in the FWC and serve on Ms Smith an outline of submissions in support of the Application and any witness statements, authorities and copies of documents upon which they sought to rely for the Application.

[5] On 5 July 2018, GCo filed an outline of submissions and a witness statement of Mr Trevor Greenaway, Office Manager for GCo (Greenaway), which annexed numerous documents relating to Ms Smith’s employment and negotiations between the parties with respect to Ms Smith’s periods of maternity leave and her duties upon her return to work following those periods of leave.

[6] The Directions also required that Ms Smith file in the FWC and serve on GCo an outline of submissions in response to the Application and any witness statements, authorities and copies of documents upon which she sought to rely.

[7] On 12 July 2018, Ms Smith filed submissions, a list of authorities and her witness statement, which annexed numerous documents relating to her employment and negotiations between the parties in respect to her periods of maternity leave and her duties upon her return.

[8] On 19 July 2018, GCo filed a jointly prepared Agreed Statement of Facts in accordance with the Directions, which the parties were advised would be admitted into evidence and considered not in dispute.

[9] The Directions contained an invitation for either party to make a request to be heard orally in relation to the Application. On 19 July 2018, GCo advised that neither party wished to make oral submissions with respect to the Application. On 23 July 2018, Ms Smith confirmed in separate correspondence that she did not wish to make any oral submissions.

[10] It is not in dispute that the terms and conditions of employment relating to the new role are unchanged; however Ms Smith argues that the new role has a lesser level of seniority and constitutes a demotion.

Relevant Statutory Provisions

[11] Section 120 of the FW Act states that:

“120 Variation of redundancy pay for other employment or incapacity to pay

(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.”

[12] Section 119 of the FW Act states that:

“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.

Note: Sections 121, 122 and 123 describe situations in which the employee does not have this entitlement.

Amount of redundancy pay

(2) The amount of the redundancy pay equals the total amount payable to the employee for the redundancy pay period worked out using the following table at the employee’s base rate of pay for his or her ordinary hours of work:

Redundancy pay period
Employee’s period of continuous service with the employer on termination	Redundancy pay period
1	At least 1 year but less than 2 years	4 weeks
2	At least 2 years but less than 3 years	6 weeks
3	At least 3 years but less than 4 years	7 weeks
4	At least 4 years but less than 5 years	8 weeks
5	At least 5 years but less than 6 years	10 weeks
6	At least 6 years but less than 7 years	11 weeks
7	At least 7 years but less than 8 years	13 weeks
8	At least 8 years but less than 9 years	14 weeks
9	At least 9 years but less than 10 years	16 weeks
10	At least 10 years	12 weeks

[13] It was not contested and I am satisfied that any entitlement of Ms Smith to redundancy pay, if it arises, does so by virtue of section 119 of the FW Act.

Factual circumstances

[14] Ms Smith commenced employment with GCo on 10 April 2012 in a full time capacity in a job role described as Human Resources Support and Document Controller, 1 reporting to the position of Health Safety and Environment (HSE) and Human Resources Coordinator.2

[15] In October 2012, Ms Smith commenced a Certificate IV in Human Resource Management. 3

[16] In August 2013, Ms Smith was promoted to the position of Human Resources Coordinator following her attainment of a Certificate IV in Human Resources Management. 4 She was employed in this role on a full-time basis.

[17] Ms Smith commenced parental leave on 26 September 2014. 5 Ms Smith’s period of unpaid parental leave was extended on several occasions at her initiative and with the agreement of GCo. GCo also granted Ms Smith permission to work as a coordinator for a not-for-profit organisation during this period of leave.6

[18] On 2 August 2016, Ms Smith advised GCo of her intention to return to work and requested discussions with a view to arranging a part-time Human Resources role. Ms Smith committed to resign from her position at the not-for-profit organisation in recommencing work at GCo. 7

[19] Following discussions between the parties, on 15 November 2016, Ms Smith returned to work on a part-time basis in the position of Training and Development Coordinator, working two days per week. 8

[20] GCo states that a consultation meeting was held on 28 March 2017 at which Ms Smith was consulted in relation to the possibility of the Training and Development Coordinator position being made redundant during her upcoming second period of maternity leave due to a downturn in the industry. The Minutes of Meeting produced by GCo state that at that meeting, Ms Smith expressed a willingness to be flexible and reduce her hours of work further on her return should it be required. 9

[21] On or around 7 June 2017, Ms Smith commenced a second period of parental leave. 10

[22] On 3 July 2017, GCo’s then Human Resources Coordinator left the Company. The responsibilities of the Human Resources Coordinator were absorbed by the Office Manager. 11

[23] On 30 April 2018, Ms Smith notified GCo of her intention to return to work on 12 June 2018 and inquired whether she would continue to be employed as Training and Development Coordinator working two days per week. 12

[24] On 11 May 2018, Mr Greenaway requested that Ms Smith meet with him at a mutually convenient time to discuss her return to work. 13

[25] On 15 May 2018, a meeting was held between Ms Smith, Mr Greenaway and Ms Aleisha Whitehead, Human Resources Coordinator. Ms Smith was advised at the meeting that due to a downturn in the industry, a restructure had occurred. This restructure meant the Training and Development Coordinator position was no longer available. Mr Greenaway advised Ms Smith that a Human Resources Support position could be created. Ms Smith raised a concern at the meeting that this would constitute a demotion, given her length of service with GCo and the development of her experience and qualifications since her commencement with GCo. 14 Mr Greenaway says that he explained that in the absence of any internal human resources expertise (following the resignation of the Human Resources Coordinator in July 2017) and in light of Ms Smith’s human resource qualifications and experience, that the new role would be more senior than Ms Smith anticipated.15

[26] On 25 May 2018, GCo sent Ms Smith a letter confirming the offer of alternative employment in the role of Human Resource Support. Relevantly, the letter stipulated:

“We can offer you work in a similar role with the same hours and conditions as previous to your Maternity Leave.

The role will be required to support the Human Resources department and help oversee all aspects of the Human Resources Process.”

[27] The letter attached a schedule setting out a summary of the terms and conditions of the new role. 16

[28] Ms Smith responded to this email on the same date asking whether a job description was available for her review. On 5 June 2018, having received no response to her request, Ms Smith requested the functionality chart and/or job description for review. 17

[29] On 5 June 2018, Mr Greenaway replied to Ms Smith informing her that GCo were currently developing a job description for the new role and attached in the interim a functionality chart for the new role from which it was planned that the job description would be developed. Relevantly Mr Greenaway stated: 18

“We have been searching for the Job Description that was done when Merilin became your support when you had the Full-time HR Role – but we cannot find it anywhere in our systems. We will need to develop a JD for the support role. Please find attached the new functionality Chart for the support Roles required from which a Job Description will be made.”

[30] The functionality chart attached to the email listed relevant roles as:

“2.5 Human Resources

Human Resources Coordinator – TG / AW [Mr Greenaway and Ms Aleisha Whitehead]

Human Resources Support – MS [Ms Smith]

Secretarial Support – BH [Ms Brodie Harvey]

…

“2.10 Training and Development

Training and Development Coordinator – TG / AW

Training and Development Support – MS

Secretarial Support – BH

…”

[31] All tasks assigned to Ms Smith in the functionality chart were denoted “AW/MS” suggesting the responsibilities were to be shared in some manner, presumably because Ms Smith was proposing to work only two days per week.

[32] On 7 June 2018, Ms Smith wrote to GCo declining the offer of employment and stating:

“Whilst I appreciate the effort made to ensure that there is a position available to me at GCo Electrical, I started my employment 6 years ago with GCo Electrical in this same position and feel that this would be accepting a demotion into a lower-level job, which was a concern I had raised at our meeting on the 15th May 2018.

In light of my options, I would like to request GCo Electrical apply for a reduced rate of redundancy pay, due to offering alternative employment within the business, but not at a level I have previously worked. As well as taking into consideration the number of years I have been on Maternity Leave vs. Actual Working years. This can be done via the Fair Work Commission (Form F45A).

I can appreciate the downturn in the current economy and the hardships that the company has been faced with recently, thus my willingness to cooperate with whatever decision is made.” 19

[33] On 12 June 2018, Mr Greenaway responded by email, regretfully accepting the resignation but disagreeing that the position offered was not at the same level as Ms Smith’s previous role. Mr Greenaway indicated that GCo intended to apply to the Commission to have the redundancy entitlements reduced to nil. 20

[34] On 20 June 2018, GCo applied to the FWC for an Order pursuant to section 120 of the FW Act to vary the amount of redundancy pay to be paid to Ms Smith to nil. Attached to the Application was a copy of the position description for the role offered to Ms Smith (Position Description).

Submissions

[35] Ms Smith acknowledges that the position that she was offered as Human Resources Support has the same hours, conditions, work location and level of income, as the Training and Development Coordinator role she previously held. However, Ms Smith submits that the duties and responsibilities are at a lower status and that therefore the position is not ‘acceptable’ employment for the purposes of section 120(1)(b) of the FW Act.

[36] In support of her submission that the role of Human Resources Support is of a lower status than her previous role of Training and Development Coordinator, Ms Smith points out that the Functionality Chart identifies Mr Greenaway and Ms Whitehead as being responsible for the Human Resources Coordinator and Training and Development Coordinator roles. Whereas the Functionality Chart identifies Ms Smith as being responsible for the Human Resources Support role and the Training and Development Support role. Ms Smith notes that she previously held the role of Training and Development Coordinator and submits that the title ‘Support’ connotes a lower status role than ‘Coordinator’.

[37] Ms Smith also submits that a review of tasks assigned to her on the Functionality Chart demonstrates that the role of Human Resources Support is of a lower status than her previous role of Training and Development Coordinator. 21

[38] In addition, Ms Smith submits that Mr Greenaway’s email of 5 June 2018 indicated that GCo had planned to use the position description for the role of Human Resources Support when Ms Smith was employed as the full-time Human Resources Training and Development Coordinator as the template for her new role as Human Resources Support. She submits that the Human Resources Support role she was offered would necessarily be more inferior to a Coordinator role given that the former Human Resources Support reported to the Human Resources Coordinator. 22 This submission presumes that the Training and Development Coordinator role was of a comparative status to the Human Resources Coordinator role rather than aligning more closely with the Human Resources Support role.

[39] According to Ms Smith, acceptance of the role of Human Resources Support would be a ‘step backwards’ and would have a negative impact on her future career goals in the Human Resources field. 23

[40] GCo deny that the role of Human Resources Support is of a lower status than Ms Smith’s previous role of Training and Development Coordinator. They submit this is so because:

a. When Ms Smith was performing the part time role of Training and Development Coordinator the organisation had a full time qualified Human Resources Coordinator.

b. In July 2017, the full-time Human Resources Coordinator resigned and the responsibilities of that role were absorbed by the Office Manager. 24

c. With the departure of the Human Resources Coordinator the organisation lacked staff with formal Human Resources qualifications. 25

d. Given that the duties of the Human Resources Coordinator are now being performed by the Office Manager as an adjunct to their primary role and that the Office Manager lacks any formal Human Resources qualifications, the Office Manager would rely far more heavily on the incumbent of the Human Resources Support role than would be the case if the business employed a full time Human Resources Coordinator and a Human Resources Support.

e. The business did not propose to employ a full time Human Resources Coordinator if Ms Smith had accepted the role of Human Resources Support.

f. In her role as Human Resources Support Ms Smith would be the only employee with Human Resources qualifications and experience, she would report directly to the Office Manager as did the Human Resources Coordinator when the organisation employed a Human Resources Coordinator. 26

[41] In support of this assertion GCo provided the following comparison of qualifications and key responsibilities for the two roles.

Key responsibilities	(Previous Role) Training and Development Coordinator	(New Role) Human Resources Support
Health and Safety Standards	The same.	The same.
Compliance	Additional requirement to comply with AS/NZ Quality standards.
Quality standards	Assists in preparing written procedures to the improvement process of GCo management system.	Prepares written procedures to the improvement process of GCo management system.
Environmental standards	Comply with statutory and contractual requirements.	Meet the GCo electrical environment standards
Technical Standards	Technically competent within the field of learning management systems and web delivery tools.	Theoretically competent within the field of HR management and IR. Competence to build and effectively manage interpersonal relationship at all levels of the company. Develop an understanding of electrical industry qualifications.
Training	Application only to this role.
Human Resources	Application only to this role.
Industrial Relations	Application only to this role.
Cost Management	Develop and maintain training budget. Operate within the approved budget. Raise POs when required and ensure costs are correctly allocated.	Assist with the preparation of the budget for HR/IR. Record Human Resources and IR expenditure and manage allocated budgets.
Management	Contract Management	Risk and HR Management
Qualification	Cert IV Training/HR 3 years’ experience. Proven ability to complete full training cycle.	Cert IV HR. 3 years’ experience. Knowledge of HR systems and databases. Excellent knowledge of employment law and HR best practices. Ability to handle data.

[42] GCo submit that the seniority of some of the Key Responsibilities of the new position are in fact higher than that of the redundant role. 27

[43] They say that the requirements in relation to Qualifications and Experience are identical for the two positions but additional ‘knowledge’ and ‘ability’ are required for the Human Resource Support position. 28

[44] According to GCo, in the new role, Ms Smith would report to the Office Manager as she did when she was Training and Development Coordinator. Furthermore they say that Ms Smith would continue to liaise with senior management in carrying out her duties in the new role as she did in her existing role. 29

Consideration

[45] It is agreed by the parties that the position that Ms Smith was offered as Human Resources Support has the same hours, conditions, work location and level of income, as the Training and Development Coordinator role she previously held. Ms Smith asserts however that the duties and responsibilities are at a lower status and that therefore the position is not ‘acceptable’ employment for the purposes of section 120(1)(b) of the FW Act.

[46] The question of what constitutes ‘other acceptable employment’ in the context of section 120(1)(b) of the FW Act was summarised by Deputy President Sams in Spotless Services Australia Ltd³⁰ as follows:

“…

•  The test of what constitutes ‘acceptable employment’ is an objective one. It does not mean it must be acceptable to the employee.

•  ‘Acceptable employment’ is not identical employment, as no two jobs could be exactly the same.

•  An employee must meaningfully cooperate with the employer in exploring or considering options for alternative positions.

•  An employee’s prima facie entitlement to redundancy pay may be at risk if the employee refuses a role or position, which is found to be objectively ‘acceptable’.”

[47] The test of acceptability of the alternative employment involves consideration of matters such as pay levels, hours of work, seniority, fringe benefits, work load and job security. 31 The FWC is required to have regard to the totality of the circumstances. No one factor will be determinative for the purposes of the discretionary judgement as to whether or not the alternative employment is acceptable.32

[48] Ms Smith reached the conclusion that the job she was offered was not acceptable employment based on the Functionality Chart. This document provides limited clarity with respect to the status of her old and new positions and needs to be considered in the context of the skill sets of the incumbents of the other roles. Ms Smith has not contested GCo’s evidence that she was the only employee with formal human resource qualifications and that she had significantly more human resources experience than other employees. Given that the duties of the Human Resources Coordinator are now being performed by the Office Manager as an adjunct to their primary role and that the Office Manager lacks any formal human resources qualifications, it is a safe assumption that the Office Manager would place more reliance on the incumbent of the Human Resources Support role, as compared to when the business employed a full time Human Resources Coordinator and a Human Resources Support as it did in the past.

[49] As is acknowledged indirectly by Ms Smith, the Position Description for the new role makes clearer than the Functionality Chart that the new position was of a comparable, if not higher status, than her formal role. Ms Smith alleges that the Position Description has been ‘doctored’ to support the Application and does not accurately reflect the role she was offered. 33

[50] I am satisfied that the Position Description is not inconsistent with the Functionality Chart, the documentary and witness evidence of the discussions between the parties, or the evidence with respect to the skills and experience of the current employees of the business.

[51] Ms Smith submits that evidence in relation to the Position Description for the new role ought not be considered by the FWC for the purposes of determining this application because the Position Description was not provided to her until it was filed in the FWC in the course of this Application, despite her requesting a copy of the Position Description on 25 May 2018 and on 5 June 2018. 34

[52] Ms Smith was not scheduled to return to work from her maternity leave until 12 June 2018. GCo met with her on 15 May 2018 to advise Ms Smith that her existing position was redundant and to offer her an alternative position. On 25 May 2018, GCo provided her with a document setting out the terms and conditions of the new position.

[53] On 25 May 2018, Ms Smith acknowledged receipt of the document and said:

“Thank you for sending through the attachments. I will look over the documents and discuss with my husband over the weekend. Any chance you have the Job Description available for me to also review?”

[54] When the job description was not forwarded to her, Ms Smith followed up on 5 June 2018 with an email that stated:

“Just wondering if you have the functionality chart available for me to review in its current format? And/or Job Description for me to review.”

[55] On the same day, GCo made it clear to Ms Smith that they intended to provide a job description and gave a reasonable explanation for the delay in providing it. 35

[56] Ms Smith’s emails of 25 May 2018 and 5 June 2018 did not convey that the provision of the job description was critical to her decision-making process, the relevant timeline for her decision-making or that she would reject the offer of alternative employment in the absence of the provision of the job description. Instead, without further reference to GCo, she elected to tender her resignation on 7 June 2018, five days before she was due to return to work.

[57] Ms Smith ‘jumped the gun’ and denied GCo a further opportunity to provide her with the job description to and thereby denied herself the opportunity to properly consider whether the alternative position was in fact of a comparable status.

[58] I am satisfied that the position offered to Ms Smith was acceptable alternative employment and that in the circumstances it is appropriate to grant the Order sought and reduce her redundancy pay to nil.

[59] An order to this effect will issue with this decision.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

<PR609243>

 1   The position description referred and annexed to the Witness statement of Trevor Wayne Greenaway dated 3 July 2018. (Greenaway Statement) refers to the position as “Human Resources Coordinator” however the document control footer indicates that the position description itself was not drafted until 10 December 2014. This suggests this document was annexed in error. The position title “Human Resources Support and Document Controller” on commencement is an agreed fact.

 2   Witness statement of Melissa Gaylene Smith dated 10 July 2018 (Smith Statement) at [1]–[2]; Statement of Agreed Fact – Respondent Witness Statement.

 3   Submissions filed by Melissa Gaylene Smith on 12 July 2018 (Smith Submissions).

 4 Smith Statement at [4].

 5   Smith Statement at [4] and Greenaway Statement at [6].

 6   Smith Statement at [5]–[10] and Greenaway Statement at [10].

 7   Smith Statement at [11]–[14] and Greenaway Statement at [15].

 8   Smith Statement at [15], Statement of Agreed Fact, and Greenaway Statement at [16]–[19].

 9 Greenaway Statement at [23].

 10   Smith Statement at [22] and Greenaway Statement at [27].

 11   Greenaway Statement at [5] and [28].

 12   Smith Statement at [28] and Greenaway Statement at [31].

 13 Smith Statement at [29].

 14 Ibid at [31].

 15 Greenaway Statement at [32].

 16 Smith Statement at [33].

 17   Ibid at [34]-[35].

 18 Ibid at [36].

 19   Ibid at Attachment T.

 20 Ibid at [42].

 21 Ibid at [40].

 22 Ibid at [39].

 23 Ibid at [40].

 24 Greenaway Statement at [28].

 25   Ibid.

 26   Submissions filed by Trevor Greenaway on behalf of GCo 5 July 2018 (Greenaway Submissions) at [28].

 27 Greenaway Submissions at [15].

 28 Ibid at [16].

 29 Ibid at [17].

30 Spotless Services Australia Limited T/A Alliance Catering [2016] FWC 4505 at [65].

 31 Clothing and Allied Trade Unions of Australia v Hot Tuna Pty Ltd (1988) 27 IR 226 at 230.

 32   Datamars (Australia) Pty Ltd T/A Datamars [2015] FWC 1269 at [28].

 33   Smith Submissions in response to the Greenaway Submissions at page 4.

 34   Ibid.

 35   Smith Submissions at Attachment Q.