Imre Pallo v University of Sydney USYD Conservatorium of Music

[2012] FWA 8290

[2012] FWA 8290

FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.739—Dispute resolution

Imre Pallo
v
University of Sydney USYD Conservatorium of Music
(C2012/4612)

SENIOR DEPUTY PRESIDENT DRAKE SYDNEY, 28 SEPTEMBER 2012

Dispute concerning renewal of employment contract - fixed term employment - severance pay - dispute resolution process - interpretation of agreement - private arbitration under dispute resolution procedure - discretion to settle dispute

[1] On 18 July 2011, Professor Pallo applied to Fair Work Australia (FWA) pursuant to s.739 of the Fair Work Act 2009 (the Act) for resolution of a dispute between himself and the University of Sydney (USYD).

[2] The dispute was notified in relation to clauses 29, 30, 31 and 32 of The University of Sydney Enterprise Agreement 2009-2012 1(the Agreement). The dispute also relates to the procedure to be followed in resolving disputes under the Agreement.

[3] Professor Pallo was, at the time of notification of this dispute, bound by the Agreement and held the positions of Professor, Chair of Conducting and Pro-Dean of Performance at the Conservatorium of Music. The Agreement has a nominal expiry date of 31 May 2012 but continues to operate and have application in accordance with s.54 of the Act.

[4] I dealt with Professor Pallo’s alleged entitlement to severance pay at a conciliation conference before me. Professor Pallo has been employed by USYD on fixed term contracts since 2005; his current contract is due to expire on 31 December 2012. USYD submitted that it is customary practice in the higher education sector to employ staff on fixed term contracts, and that, in recognition of the high incidence of fixed term employment, the Agreement provides for the payment of severance pay to such employees on certain conditions.

[5] USYD believed, and acted on the basis that, Professor Pallo intended to resign at the end of his fixed term contract. As a result, in correspondence dated 29 May 2012, Professor Pallo was advised he would “...not be offered that position for a further term as you have indicated you wish to retire at the end of the fixed term contract”. USYD contends that Professor Pallo informed Professor Kramer, the new Dean and Principal of the Conservatorium, of his intention to retire at the end of his current contract in or about April 2012. USYD further contends that Professor Pallo’s intention to resign was common knowledge, and that two farewell concerts had been organised for him. There is also an email dated 7 May 2012 from Professor Pallo to the Immigration and Relocation Officer of USYD in which Professor Pallo discusses a “...final return flight to our home in the United States, at the expiration of my contract”.

[6] Professor Pallo denies that he informed Professor Kramer (or anyone else for that application) of any intention to resign. He contends that USYD did not give him an official offer to renew his current contract which he could accept or reject. In response to these contentions, Professor Kramer, in an email dated 27 June 2012, offered Professor Pallo a further fixed term contract for one year until December 2013. Professor Pallo did not accept this offer and maintained that he had accepted USYD’s termination of his contract and was seeking severance pay as a result.

[7] I held a conciliation conference in relation to this application in Sydney on 25 July 2012. At the conference USYD offered Professor Pallo a contract for an indefinite period of time. Professor Pallo did not accept this offer and the application was subsequently listed for hearing. I gave the parties an opportunity to have the application listed before another member but they agreed to have the application listed before me.

[8] USYD’s position was that Professor Pallo had not satisfied some or all of the conditions for the payment of severance pay upon expiry of a fixed term contract, and as such, is not entitled to any severance pay under the Agreement.

[9] I am satisfied that Professor Pallo’s appointment was not terminated by USYD. USYD acted under a misunderstanding of fact and accepted what they perceived to be Professor Pallo’s decision not to renew his contract. There has been no termination of employment which could give rise to a severance payment under the agreement.

[10] I advised Professor Pallo in the conciliation conference that the facts of his application did not support a finding that his contract had been terminated by USYD and that there was no entitlement to severance pay. However, Professor Pallo remained aggrieved by what he saw as a failure of process, and was offended by the manner in which he, as a senior academic, had been treated by USYD.

[11] I have considered the application of the dispute resolution process. After verbal discussions with Professor Kramer on 4 July 2012 failed to resolve the issue around severance pay, Professor Pallo requested a meeting with the Provost of the University of Sydney. Professor Pallo did not receive a response from the Provost and a meeting did not transpire.

[12] Exhibits tendered by USYD at the hearing explained that “...the Provost was absent from work and heading overseas at the time Professor Pallo emailed him and an ‘out of office’ message had not been set up for him at that time” and that upon his return the “Provost sought advice and was about to arrange a meeting when the dispute notification [Form F10] was received”.

[13] USYD’s position is that the Provosts delay in responding to Professor Pallo and arranging a meeting had no material effect on Professor Pallo.

[14] Professor Pallo feels that, to say the least, the end of his contract was not handled as well as it should have been by the Conservatorium of Music or the broader USYD. In particular, he feels that he should have been formally consulted before a letter referring to the termination of his contract was sent to him.

[15] He sought the following relief from this Tribunal:

• Eight weeks of severance pay in accordance with the Agreement;



• All personal expenses incurred because of this dispute; and



• Compensation for the stress, distress and emotional turmoil suffered by him and his wife during this process.

[16] Professor Pallo does not have an entitlement to severance pay arising from the end of his contract. Professor Pallo intended to resign at the end of his contract and he did so. The correspondence from USYD, of which Professor Pallo complains was carelessly worded, and there is no doubt that the arrangements in relation to the acceptance or otherwise of any resignation by Professor Pallo could have been handled differently, and perhaps more correctly. The Provost's inadequate arrangements regarding his absence and the handling of responses during his absence, are an explanation, not an excuse, for failing to have arrangements in place to deal with disputes.

[17] Despite these irritating circumstances, the fact is that Professor Pallo intended to end his contract with USYD and he did so. USYD was acting under a mistaken understanding of the circumstances. It did not intend to end Professor Pallo’s arrangements with it. It was happy for them to continue. Professor Pallo was offended by USYD’s method of dealing with him and, despite its offer of continued employment, intends to act on his resignation and depart.

[18] Professor Pallo also complains that the dispute resolution process was not properly followed in that USYD did not respond in an appropriate way to his correspondence. There is merit in this argument even though there were no particular adverse consequences for either party except the irritation to Professor Pallo arising from what he perceived to be USYD’s corporate bad manners.

[19] There should have been a timely and appropriate response to Professor Pallo’s correspondence. There is no satisfactory explanation for its failure. In the Provost’s absence there should have been alternative arrangements in place. Much of this sorry tale could have been avoided had there been an immediate response. To the extent that there was a failure to respond adequately and speedily to Professor Pallo there has been a failure to properly apply the grievance procedure. In that regard I am critical of USYD. However, that is the end of the applications of justifiable complaint.

[20] In relation to the relief sought by Professor Pallo I have already determined that there is no entitlement to severance pay. There is no entitlement to any personal expenses incurred as a result of this dispute nor is there any entitlement to compensation for stress, distress or emotional turmoil, if it were to be established that there were such personal expenses or consequences.

SENIOR DEPUTY PRESIDENT

Appearances:

Professor I. Pallo the Applicant

Ms M. Wilkinson, Professor K. Kramer and Ms P. Spicer on behalf of the University of Sydney USYD Conservatorium of Music

Hearing details:

2012

Sydney

24 August

 1   AE872161.

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