Jessica Guilfoyle v Ultimo Catering and Events Pty Ltd

[2016] FWC 5233

[2016] FWC 5233

FAIR WORK COMMISSION

REASONS FOR DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Jessica Guilfoyle
v
Ultimo Catering and Events Pty Ltd
(U2016/2603)

SENIOR DEPUTY PRESIDENT O’CALLAGHAN ADELAIDE, 2 AUGUST 2016

Application for relief from unfair dismissal –genuine redundancy –consultation requirements not met.

Reasons for Decision

[1] These reasons for decision set out the basis for the conclusion I reached following a determinative conference on 28 July 2016.

[2] On 1 June 2016, Ms Guilfoyle lodged an unfair dismissal application pursuant to s.394 of the Fair Work Act 2009 (the FW Act) in relation to the termination of her employment with Ultimo Catering and Events. I have amended the application pursuant to s.586 of the FW Act to note that the correct name of the respondent is Ultimo Catering and Events Pty Ltd, referred to in this decision as Ultimo.

[3] Ultimo objected to the application on the basis that it asserted that the termination of Ms Guilfoyle’s employment could not be unfair because it met the definition of a genuine redundancy.

[4] This initial issue was the subject of the determinative conference in Perth on 28 July 2016. At this conference Ms Guilfoyle represented herself, with her mother as her support person, and Ultimo was represented by Mr Otero.

[5] Ultimo provides event catering services. Ms Guilfoyle was engaged as an Event Coordinator from October 2014. On 13 May 2016, Ultimo terminated Ms Guilfoyle’s employment on the basis that her position had been made redundant.

[6] Section 385 of the FW Act states:

“385 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

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

Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.”

[7] A genuine redundancy is defined in s.389 of the FW Act, which states:

“389 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.

(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.”

[8] Ultimo asserted that a downturn in business meant that it did not require Ms Guilfoyle’s position and that she has not been replaced. Ms Guilfoyle asserted that Ultimo did not experience any significant work reduction and that another employee engaged in February 2016, and also undertaking event coordination, but at a more senior level, effectively replaced her. Ms Guilfoyle asserts that her job is still being performed by other employees.

[9] Ultimo asserted that, on 26 April 2016, soon after it decided to make the organisational change relative to Ms Guilfoyle’s position, it met with her to advise her of the change proposed and to put to her a redeployment opportunity. Ultimo assert that its consultations met the requirements of the Hospitality Industry (General) Award 2010 (the Award), which it agrees, covered Ms Guilfoyle’s employment. Ms Guilfoyle asserted that these consultation requirements were not met.

[10] Ultimo asserted that, given the downturn in its business, there was no reasonable capacity to redeploy Ms Guilfoyle beyond the casual employment offer confirmed to her on 13 May 2016. Ms Guilfoyle asserts that she could have been transferred into other positions, such as a corporate event position, vacant since another employee resigned some months earlier and that an offer of casual work given to her on 10 May 2016, did not represent a reasonable redeployment option.

The Evidence

[11] Whilst I have considered all of the evidence before me in this matter, I have briefly summarised the witness evidence in the following terms.

[12] Ms Guilfoyle’s evidence went to her employment with Ultimo, and, in particular, the final weeks of that employment. She advised of the substantial workload she undertook and her various discussions with Ultimo management relative to her job, her work performance and her job security. She recounted a discussion on 29 April 2016, when an alternative role was discussed with her. She detailed her understanding of her discussions with Mr Otero on 11 May 2016, when she was advised that she was being made redundant. Ms Guilfoyle then sought advice about the implications of this relative to her visa. Her evidence went to a further discussion with Ultimo management on 13 May 2016 where the difficulties associated with her capacity to accept casual work under the visa arrangements applicable to her were discussed and the casual redeployment option was discounted.

[13] Mr Shaw was Ms Guilfoyle’ s Manager. His evidence went to the significant downturn in demand for Ultimo’s services, particularly with respect to major events, which led to the decision to make her position redundant. Mr Shaw explained how Ultimo selected Ms Guilfoyle to be made redundant and his involvement in various discussions with her about that redundancy and possible redeployment to a casual position. In this respect, I note that the parties disagree about the dates on which some of these discussions occurred and the nature of the discussions. I have addressed those differences later in this decision.

[14] Mr Kana is the Finance and Administration Manager for Ultimo. His evidence went to confirm Ultimo’s financial difficulties as a consequence for diminished demand, from February 2016, and to the various measures, including the reduction in staff working hours and weekly payments, adopted to address this downturn. Mr Kana participated in discussions with Ms Guilfoyle, her mother and Mr Otero on 13 May 2016 and gave evidence about the advice given to Ms Guilfoyle about her redundancy and possible redeployment.

[15] Mr Otero is the Chief Executive Officer of Ultimo. His evidence went to the extent of the downturn in business for Ultimo since February 2016 and particularly, the reduction in major corporate events. He explained how these changes required major cost saving initiatives within Ultimo and the injection of substantial capital from the business owners so as to preserve the business. Mr Otero was the key decision-maker who determined that Ms Guilfoyle’s position should be made redundant. He detailed the basis for that conclusion, his development of a casual redeployment option and his discussions with her about that option.

[16] Mr Otero confirmed the position held by Ms Guilfoyle and the extent to which this was substantially consistent with the senior clerical classification in the Award, such that he agreed that the Award covered her employment. He agreed that, until the day of the termination of her employment, no written advice was given to Ms Guilfoyle confirming the restructuring proposals and detailing steps being considered to mitigate the effect of those changes.
[17] Mr Otero’s evidence went to the extent to which redeployment options other than the casual position offered to Ms Guilfoyle were not available to Ultimo given its parlours financial state.

Findings

[18] Ultimo’s decision to terminate Ms Guilfoyle’s employment was made in the context of a significant reduction in demand for catering and event management services, which had a profound effect on its trading position. I have accepted the evidence of Mr Otero and Mr Shaw that this led to a decision that the position held by Ms Guilfoyle would be abolished and that her duties would be undertaken by other employees, including by the Senior Event Coordinator engaged earlier in the year. Whilst it may have been open to Ultimo to reach a different conclusion, the evidence before me clearly establishes that Ultimo determined that it no longer required Ms Guilfoyle’s position to be undertaken by anyone as a result of changes to its operational requirements. Consequently, the termination of Ms Guilfoyle’s employment was consistent with s.389(1)(a) of the FW Act.

[19] The evidence of Mr Otero requires that I reach a different conclusion with respect to s.389(1)(b).

[20] Ms Guilfoyle’s employment was covered by the Hospitality Industry (General) Award. Clause 8.1 of that Award states:

“8.1 Consultation regarding major workplace change

(a) Employer to notify

(i) Where an employer has made a definite decision to introduce major changes in production, program, organisation, structure or technology that are likely to have significant effects on employees, the employer must notify the employees who may be affected by the proposed changes and their representatives, if any.

(ii) Significant effects include termination of employment; major changes in the composition, operation or size of the employer’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 this award makes provision for alteration of any of these matters an alteration is deemed not to have significant effect.

(b) Employer to discuss change

(i) The employer must discuss with the employees affected and their representatives, if any, the introduction of the changes referred to in clause 1.1(a), the effects the changes are likely to have on employees and measures to avert or mitigate the adverse effects of such changes on employees and must give prompt consideration to matters raised by the employees and/or their representatives in relation to the changes.

(ii) The discussions must commence as early as practicable after a definite decision has been made by the employer to make the changes referred to in clause 1.1(a).

(iii) For the purposes of such discussion, the employer must provide in writing to the employees concerned and their representatives, if any, 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 no employer is required to disclose confidential information the disclosure of which would be contrary to the employer’s interests.”

[21] Notwithstanding differences between the parties about the date or dates upon which various discussions about the future of Ms Guilfoyle’s employment occurred, I am satisfied that the evidence confirms that their discussions about those matters occurred in the period between 24 April and 29 April but that these discussions did not determine any agreed alternative position for Ms Guilfoyle. I have concluded that, by the end of April 2016 Ms Guilfoyle was, or should have reasonably been aware, that her position was in jeopardy and that alternative work options were being considered by Ultimo. This is consistent with the evidence of Mr Shaw and Mr Otero.

[22] However, Ultimo did not comply with the requirement in clause 8.1(b)(iii) of the Award to provide written advice to Ms Guilfoyle, setting out relevant information about the organisational changes it proposed to make and the expected effects of those changes on her. Whilst the evidence before indicates that this was unlikely to have changed the ultimate result, I am unable to conclude that Ultimo complied with the requisite obligation in s.389(1)(b) to consult in accordance with the requirements of the applicable modern award.

[23] Notwithstanding this, I have considered whether Ultimo met its obligations in accordance with s.389(2) of the FW Act. I am satisfied that this was the case. Ultimo was confronting severe financial constraints such that redeployment to a comparable position was simply not a reasonable option. That is clear from the evidence of Mr Otero and Mr Kana and is simply demonstrated by Mr Otero’s advice of the significant shortfall in weekly income compared to weekly wages costs over this time. 1

[24] There can be no doubt that Ms Guilfoyle was entitled to reject the offer of casual employment on the basis that it was not an acceptable alternative to her previous position. However, the Ultimo trading position was such that I have accepted that it was not reasonable in all the circumstances for her to be redeployed in any form of comparable position.

Conclusion

[25] As I have explained, Ultimo met the requirements of s.389(1)(a) and s.389(2) of the FW Act. Because the requirements of s.389(1)(b) were not met, the Ultimo objection to the application must be refused and Ms Guilfoyle’s application will consequently be referred for conciliation. An Order (PR583567) to this effect will be issued.

It is appropriate that I make one final observation, consistent with the advice I provided at the conclusion of the determinative conference. The evidence before me indicates that Ultimo’s failure to meet the full consultation requirements in the relevant Award is extremely unlikely to have altered the outcome in this matter. Indeed, even if the requisite consultation obligations were applied, Ms Guilfoyle may well have been dismissed in a similar timeframe. Consequently, the conclusion reached by a majority in the Full Bench decision in Harvey v UES (Int’l) Pty Ltd 2 may provide the parties with a useful guide to the considerations which may be relevant if this matter ultimately proceeds to arbitration on the merits. I have provided the parties with a copy of this decision and recommend careful consideration of it.

Appearances:

J Guilfoyle on her own behalf.

J Otero on behalf of Ultimo Catering and Events Pty Ltd.

Hearing details:

2016.

Perth:

28 July.

 1   Transcript 28 July 2016, 13.16pm

 2   [2012] FWAFB 5241

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