George Attard v Transfield Services (Australia) Pty Limited

[2014] FWC 8114

[2014] FWC 8114

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

George Attard
v
Transfield Services (Australia) Pty Limited
(U2014/8292)

COMMISSIONER BULL SYDNEY, 20 NOVEMBER 2014

Application for unfair dismissal, ex-tempore decision, application dismissed.

[1] This matter was heard in Sydney on 13 November 2014. At the end of the day and the conclusion of the hearing, I advised the parties that I would hand down my decision extemporaneously, on transcript, the following day, 14 November 2014. This is a published and edited version of the decision given on transcript.

[2] In this application made by Mr George Attard (the applicant) he alleges that he was unfairly dismissed by his previous employer, Transfield Services (Australia) Pty Limited (the respondent).

[3] Mr Attard was made redundant on 27 June 2014, in circumstances that he described as being harsh, unjust or unreasonable.

[4] The respondent opposed the application on the basis that the dismissal was a genuine redundancy.

[5] At the hearing, the applicant was represented by Mr D. Magin, and the respondent was represented by Mr D. Dal Bon, Industrial Relations Manager.

Relevant Legislation

[6] To examine the respondent's jurisdictional objection it is first necessary to examine the relevant legislation. Section 394(1) of the Fair Work Act 2009 (the Act) provides that a person who is being dismissed may apply to the Fair Work Commission (the Commission) for an order under Part 3-2 - Unfair Dismissal, Division 4 - Remedies for unfair dismissal of the Act.

[7] Section 385 of the Act provides a definition of what an unfair dismissal is:

What is an unfair dismissal

A person has been unfairly dismissed if the FWC is satisfied that:

(a)  the person has been dismissed; and

(b)  the dismissal was harsh, unjust or unreasonable; and

(c)  the dismissal was not consistent with the Small Business Fair Dismissal Code; and

and relevantly in this case:

(d) the dismissal was not a case of genuine redundancy.

(My emphasis)

[8] Section 396 of the Act, requires the Commission to decide a number of threshold issues before considering the merits of an application for unfair dismissal. The relevant issue in this case is found at s.396(d) which states:

Initial matters to be considered before merits

The FWC must decide the following matters relating to an application for an order under Division 4 before considering the merits of the application:

...

(d)  whether the dismissal was a case of genuine redundancy.

[9] One effect of s.396 of the Act is that if a dismissal is a result of a genuine redundancy which is what is put by the respondent, then the Commission need not determine and nor does it have jurisdiction to determine whether the dismissal was harsh, unjust or unreasonable.

[10] Section 389 of the Act sets out the meaning of “genuine redundancy” which is wider than simply whether the employee's job is no longer required. Section 389(1) states:

Meaning of genuine redundancy

(1) A person's dismissal was a case of genuine redundancy if:

(a) the person's employer no longer required the person's job to be performed by anyone because of changes in the operational requirements of the employer's enterprise; and

(b) the employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.

(My emphasis)

[11] I note that the reference at s.389(1)(b) is to whether the employer has complied with any obligation to “consult” about the redundancy as opposed to any other obligation under a modern award or enterprise agreement in relation to redundancy.

[12] Section 389(2) of the Act goes on to say:

(2) A person's dismissal was not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within:

(a) the employer's enterprise; or

(b) the enterprise of an associated entity of the employer.

The enterprise agreement

[13] It is not disputed that an enterprise agreement applied to the applicant in this case, that being, the Greenfield agreement titled, Transfield Services Greenfields LMM Enterprise Agreement 2013-2016 1(the Agreement).

[14] The Agreement has two relevant provisions that the employer must comply with where an employee is made redundant, in particular, clause 9 - Introduction of Change and clause 19 - Redundancy.

[15] Clause 9 of the Agreement states:

9. INTRODUCTION OF CHANGE

9.1 Notification of Intended Changes

9.1.1 Where the Company has made a definite decision to implement changes in production, programming, organisation, structure or technology that is likely to have significant effects on employees, the Company will as soon as practicable notify the employees who may be affected by the proposed changes and the Union.

9.1.2 "Significant Effects" include termination of employment; major changes in the composition, operation or size of the Company's workforce or in the skills required; the elimination or diminution of job opportunities, promotion opportunities or job tenure; the alteration of hours of work; the need for retraining or transfer of employees to other work or locations; and the restructuring of jobs. Provided that where the Agreement makes provision for alteration of any of the matters referred to in this para an alteration will be deemed not to have significant effect.

9.2 Consultation with Employees and their Union.

9.2.1 The Company will discuss with the employees affected and the Union among other things, the introduction of the changes referred to in para 9.1.1, the effects the changes are likely to have on employees, measures to avert or mitigate the adverse effects of such changes on employees and will give prompt consideration to matters raised by the employees and/or the Union in relation to the changes.

9.2.2 The discussions will commence as early as practicable after a definite decision has been made by the Company to make the changes referred to in para 9.1.1.

9.2.3 For the purposes of such discussion, the Company will provide in writing to the employees concerned and the Union, all relevant information about the changes including the nature of the changes proposed; the expected effects of the changes on employees and any other matters likely to affect employees provided that the Company will not be required to disclose materials classified as commercial in confidence or any other confidential information.

9.2.4 An employee may be represented in consultations under this clause consistent with sub-clause 11.3 of this Agreement.

[16] In summary clause 9 applies where the employer has made a definite decision to implement a change in the structure of the organisation where that change would have a significant effect on employees which includes termination of employment.

[17] The clause requires the employer to firstly notify affected employees and their union as soon as practicable after having made the decision to implement the change. Secondly, to discuss with the employees the effects the changes are likely to have on employees and measures to avert or mitigate the adverse effects of the change and give prompt consideration to matters raised by an employee. Thirdly, the discussions are to commence as soon as practicable and for the purposes of such discussions, the employee is to be provided in writing all relevant information.

[18] Clause 19 of the Agreement, which is titled "Redundancy" and in particular sub clause 19.1 - Discussions before Terminations states:

19. REDUNDANCY

19.1 Discussions before Terminations

19.1.1 Where the Company has made a definite decision that it no longer wishes the job an employee has been doing done by anyone and that decision may lead to termination of employment (i.e. “redundancy”), the Company will have discussions as soon as practicable with the employees directly affected and with their Union. Discussions will cover, among other things, the reasons for the proposed terminations, measures to avoid or minimise the terminations, and measures to mitigate the adverse effects of any terminations on the employees concerned.

19.1.2 For the purposes of discussion the Company will as soon as practicable provide in writing to the employees concerned and their Union all relevant information about the proposed terminations including the reasons for the proposed terminations, the number and categories of employees likely to be affected, and the number of workers normally employed and the period over which the terminations are likely to be carried out. Provided that the Company will not be required to disclose confidential information.

[19] In summary this clause is not dissimilar to clause 9 and requires the employer to commence discussions as soon as practicable. Secondly, the discussions are to consider measures to avoid or minimise the adverse effects on the employee. Thirdly, the clause also requires the employer to as soon as practicable reduce to writing all the relevant information concerning the proposed terminations including the reasons for the proposed terminations.

Applicant’s submissions

[20] In this matter Mr Attard submits the consultation provisions of the Agreement were not complied with and therefore the termination is not a genuine redundancy for the purpose of s.389 of the Act.

[21] Mr Attard gave evidence, prepared a witness statement and was cross-examined.

[22] Mr Attard had been employed with the respondent since September 2013, as an Electronic Technician, a C7 trade classification.

[23] Mr Attard was employed on the respondent’s Land Materiel 2 Maintenance Contract at the Department of Defence’s Moorebank facility in New South Wales. Mr Attard acknowledged that on 29 May 2014 he received written notification of intended changes from Mr McDowell, the respondent's contract manager.3 The notice was given to him at a meeting with other employees on 29 May 2014. The notice stated a number of things. For the purposes of this decision the first three paragraphs are relevant, they state:

“As a consequence of a contract-wide budget review undertaken by the Department of Defence for the Land Materiel Maintenance (LMM) contract, Transfield Services has been informed that effective 01 July 2014, new arrangements will apply for the provision of existing electronic trade maintenance services currently delivered by LMM Moorebank, in accordance with a reorganised LMM maintenance services structure.

The effect of the reorganised LMM maintenance services structure will result in a direct reduction of C7 - Electronic Technician tradespersons’ currently engaged at LMM Moorebank. The Department of Defence has determined that existing electronic trade maintenance services will be consolidated and partly redistributed to alternative Joint Logistics Units (JLU) under the new maintenance services structure.

Accordingly, the Company confirms that the following reduction is required within the C7 Trade (Electronic Technician) classification structure at Moorebank, and hence all surplus roles will be subject to the implementation of genuine workplace redundancies.” 4

[24] The notice goes on to state that six C7 Electronic Technicians will be made redundant and that consultation about this process will occur and any queries are to be referred to Mr Foster, the JLU Manager at LMM Moorebank.

[25] Mr Attard gave evidence that the following day he received a letter from the respondent advising that he had been selected for redundancy and he was required to work out his notice period until 27 June 2014. 5 The letter also stated, in the third paragraph:

“At this stage of the process there are no redeployment opportunities within your skill-set available however during your notice period, the Company will continue to search for alternative employment opportunities that may exist at other LMM sites or elsewhere within the Company. Your manager will keep you informed of these actions.” 6

[26] The letter advises Mr Attard that he can contact the HR/IR Manager, Ms Maria Steel regarding any enquiries about payments or associated matters and a mobile telephone number was provided.

[27] In cross-examination Mr Attard acknowledged that during his notice period he was offered:

● assistance to draft his resume,
● training relating to interview skills; and
● an opportunity to directly speak to a HR officer.

[28] Mr Attard said in evidence that he declined to avail himself of any of these services. 7

[29] Mr Attard further acknowledged that he did not apply for two vacant positions within his skill set that became available in Victoria. One of these positions was subsequently taken by one of his colleagues who had also been selected for redundancy. 8

[30] Mr Attard also did not apply for a cleaning position that became available. 9 Mr Attard provided reasons for not applying for both these vacant positions which in my view were quite understandable.10

[31] Mr Attard testified to numerous emails that he had sent to Transfield management requesting further information and then referred to management’s email replies and also a number of cases where he alleged that the respondent failed to reply at all.

[32] The conclusion Mr Attard asked the Commission to draw, was that the consultation provisions of the Agreement had not been fully complied with.

Respondent’s submissions

[33] The position of the respondent was that as the applicant had been made redundant in accordance with the definition in the Act, no jurisdiction for an unfair dismissal claim exits.

[34] The respondent submitted that the redundancies were a direct response to a reduction in client service requirements which resulted in a decrease of the Electronic Technician positions at the relevant worksite from 12 down to six 11 following a direction from the Department of Defence in relation to its Land Materiel Maintenance Contract with the Department.

[35] The Commission was told in evidence that only four redundancies occurred as one of the employees was redeployed to a worksite in Victoria and another was engaged in another position he was qualified for.

[36] The respondent submitted that the redundancy of Mr Attard was genuine because:

● the job was no longer required to be performed by anyone else,
● the consultation requirements in the Agreement had been complied with; and
● it was not reasonable for Mr Attard to be redeployed elsewhere having undertaken genuine efforts to find alternate employment for Mr Attard both within the LMM contract and its business nationally.

[37] Mr Andrew Foster, Manager, Joint Logistics Unit (East) - Land Materiel Maintenance Contract provided a witness statement, gave evidence and was cross-examined.

[38] Mr Foster stated he was aware of the respondent’s redundancy obligations that were contained in the Agreement and that every effort had been made to ensure compliance with those obligations.

[39] Mr Foster advised of a meeting that was held on 29 May 2014, (which he did not attend as he was in the Australian Capital Territory) to advise employees of the need for redundancies to occur. Mr Foster stated that during the redundant employees' notice period he continued to consult with each employee including Mr Attard. 12 Mr Foster advised that he met several times with Mr Attard to clarify matters he was not clear on and responded to his emails either by return email or in a face to face conversation. In an email dated 4 June 201413, which Mr Foster sent to Mr Attard, he included a web link to Transfield's career centre which listed vacant positions. The email states:

“As discussed today, I am hoping that during this difficult time, I am able to help you the best I can in trying to find you another opportunity within Transfield Services and minimise the impact this unfortunate situation has placed you in.

Please find below the link to the career centre, where you will be able to find the majority of the available jobs within the company. I will discuss any potential options that you would like to pursue, tomorrow.” 14

[40] The web link is provided, and the email goes on to say:

For ease, if you can respond to this email with a word document version of your resume, it will greatly assist our HR representative in her ability to keep you update (sic) and adjust your resume. 15

[41] Mr Foster stated that he attempted to find alternate employment for all redundant employees including Mr Attard. Mr Foster assisted in organising Transfield's HR team to assist the redundant employees to complete resumes and provide interview advice. However, Mr Attard did not require these services.

[42] A position of electrical fitter became available during the notice period and given to another redundant employee. This required a trade certificate III which Mr Attard did not hold.

[43] Mr Foster conceded that during the consultation process he mistakenly assumed that Mr Attard was a member of the relevant union. However as soon as he was advised that this was not the case he acted accordingly. 16

Conclusion

[44] There is no dispute between the parties that the applicant's position was no longer required to be performed by anyone because of the change to the Land Materiel Maintenance Contract.

[45] It is also clear, despite the relatively short period of service with Transfield, that Mr Attard was understandably aggrieved by his redundancy.

[46] It appeared clear through the hearing that the selection process used by the respondent to identify employees for redundancy caused Mr Attard the most concern. Much of the submissions and evidence put on behalf of Mr Attard related to the fairness or otherwise of the redundancy process, and in particular, as I have discussed, the selection process.

[47] As is clear in the Act, where a redundancy satisfies the definition of “genuine redundancy” as per s.389, the fairness of the termination in relation to the selection process is not relevant. This is the clear effect of s.385 of the Act. To put this beyond any doubt in the Explanatory Memorandum of the Fair Work Bill 2008, in particular Item 1553 which reads as follows:

Whether a dismissal is a genuine redundancy does not go to the process for selecting individual employees for redundancy. However, if the reason a person is selected for redundancy is one of the prohibited reasons covered by the general protections Part 3-1 then the person will be able to bring an action under that Part in relation to the dismissal.

(My emphasis)

[48] Despite the fact that there were suggestions through the hearing and in the written submissions that Mr Attard had been discriminated based on his age and non-union membership a General Protections claim has not been made. While these arguments have no direct relevance to whether the respondent complied with its consultation obligations under the Agreement the allegations of discrimination put before the Commission were not supported by any direct evidence and were simply in my view suppositions made by Mr Attard.

[49] I accept, having heard the evidence from both parties that the consultation process undertaken by Transfield was far from one of perfection. The failure to return phone calls by the HR department is but one example.

[50] While Transfield is required to comply with the Agreement terms it to consult about redundancy, this statutory requirement cannot be elevated to any more than simple compliance. A bare minimum compliance is all that is required.

[51] Transfield’s Agreement consultation obligations do not require it to do more than consult in the terms expressed under the Agreement. Mr Attard’s submissions attempted to raise Transfield’s level of compliance to one of best practice by demonstrating that more could have been done.

[52] The evidence in my view clearly demonstrates that Transfield has:

● notified Mr Attard as soon as practicable of the decision to effect redundancies,
● conducted discussions with the relevant employees including Mr Attard which it commenced as soon as practicable following its decision to make the redundancies,

● provided in writing the relevant information to Mr Attard about the reasons and numbers of employees affected,
● undertaken activities to avoid, minimise or mitigate the adverse effects of the termination on Mr Attard; and that
● it was not reasonable, having heard the evidence, to redeploy Mr Attard elsewhere.

[53] In all respects the requirements of s.389 of the Act were met by Transfield. As such, a complete defence to the claim of unfair dismissal has been made out.

[54] Had I found that Transfield had not met its consultation obligations under the Agreement, it would not automatically have followed that the termination was unfair.

[55] I refer to the decision of Vice President Watson in Maswan, v Escada Textilvertrieb T/A ESCADA 17, and in particular paragraph 39, where the Vice President states:

“In my view a decision to dismiss on account of redundancy will only be harsh, unjust or unreasonable if the rationale for the decision is seriously undermined or if there is a serious error in procedure such that renders the termination unfair in the circumstances. Here the decision appears open to the employer to make. The failure to consult is not a trivial matter. But as it is clear that consultation was highly unlikely to have negated the operational reasons for the dismissal or lead to any other substantive change, I do not believe that the failure to consult prior to the date of termination rendered the dismissal unfair. Given the evidence in relation to the operational need to restructure, I am of the view that it is likely that Mr Maswan would have been dismissed in any event, even if timely consultation had occurred.”

[56] The comments of the Vice President are apt in this application before me.

[57] On the basis of the conclusions I have reached that the “genuine redundancy” defence has been made out I have no alternative other than to dismiss the application.

COMMISSIONER

Appearances:

Mr Magin on behalf of the applicant.

Mr Dal Bon for Transfield Services (Australia) Pty Ltd.

Hearing details:

2014.

Sydney:

13 and 14 November.

 1   AE401695.

 2   Oxford English Dictionary, Eighth Edition, defines ‘materiel’ as materials and equipment in warfare.

 3   Exhibit A2, Notification of intended changes dated 29 May 2014.

 4   Exhibit A2, Notification of intended changes dated 29 May 2014.

 5   Exhibit A1, Letter of termination dated 30 May 2014.

 6   Exhibit A1, Letter of termination dated 30 May 2014.

 7   Transcript PN422-423.

 8   Transcript PN417 and PN423.

 9   Transcript P422.

 10   Transcript PN477-482.

 11   Respondent’s outline of submissions dated 30 September 2014 at paragraph 2.

 12   Transcript PN750.

 13   Exhibit A4, Email from Mr Foster dated 4 June 2014.

 14   Exhibit A4, Email from Mr Foster dated 4 June 2014.

 15   Exhibit A4, Email from Mr Foster dated 4 June 2014.

 16   Transcript PN1015.

 17   [2011] FWA 4239.

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