Jim Kelliher v City of Armadale

[2014] FWC 2858

[2014] FWC 2858

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

Jim Kelliher
v
City of Armadale
(C2013/1188)

DEPUTY PRESIDENT MCCARTHY PERTH, 2 MAY 2014

Alleged dispute about matters arising under the enterprise agreement.

[1] This matter concerns an application lodged by Mr Jim Kelliher (the Applicant) regarding a dispute in accordance with a dispute settlement clause. The dispute concerns the City of Armadale Enterprise Agreement 2010 [2011 FWAA 1322] (the Agreement). The matter was endeavoured to be resolved through conciliation but remained in dispute. The Agreement provides for the arbitration of the matters in dispute in those circumstances. There is no objection to that arbitration occurring.

[2] The dispute relates to the application of Clause 13.12 Retention Incentive Allowance (the allowance). The Applicant argues that he has an entitlement to the payment for March 2013. The relevant provision in the Agreement provides as follows:

“The retention incentive allowance is a lump sum payment, made at the end of March each year, for employee’s that have reached the top increment of their salary level and meet certain criteria.

The criteria for receiving the incentive are

● employee must be at the top of their salary point
● employee must be demonstrating exemplary performance
● employee must have been employed by the City for a minimum of 18 months
● employee has remained employed by the City

The retention incentive does not apply to an employee who is promoted, reclassified or ceases employment with the City during the course of the year.

For the first two years the Allowance is 2.5% of the employee’s salary and for the third and subsequent years it is 5% of the employee’s salary.”

Submissions and Evidence

[3] The Applicant argued that:

“a. He is at the top of his salary point. He reached this point in December 2012 by way of an incremental salary increase. There was no change in his position, duties or responsibilities associated with this incremental salary increase.

b. He has been employed by the City of Armadale for more than 18 months.

c. Mr Kelliher remains employed by the City of Armadale – he retains his Senior Ranger position.

d. He has not been promoted, reclassified or ceased employment with the City during the course of the year.

e. He is demonstrating exemplary performance …”

[4] The Respondent submitted that:

“5. Mr Kelliher’s first step of inquiry as to his eligibility to receive this allowance was to the Executive Director of Community Services, Yvonne Loveland (nee Coyne). This was in the form of letter dated 23 April 2013.

6. On 11 June 2013 Mrs Loveland responded to Mr Kelliher’s request and advised that the allowance is discretionary.

7. In support of to this statement, we submit that, as the allowance is conditional on meeting certain criteria, including an assessment that an employee has demonstrated exemplary performance, the allowance is discretionary. The officer conducting the assessment is required to determine if this criterion is met or not met.

8. In this instance, Mrs Loveland conducted that assessment and determined that Mr Kelliher did not meet the criterion of “demonstrated exemplary performance”.

9. Mrs Loveland advised that the time Mr Kelliher was at the top of his Level “was not of a length of time for you (Mr Kelliher) to be able to demonstrate exemplary performance.”

...

16. Mr Kelliher did not meet the criterion of “demonstrating exemplary performance” to the satisfaction of the Executive Director

17. Mr Kelliher did not meet the criterion of “demonstrating exemplary performance” to the satisfaction of the Chief Executive Officer.

18. Mr Kelliher should therefore not be awarded the Retention Incentive Allowance.”

[5] The entitlement to payment of the Retention Incentive Allowance is conditional on the employee must having reached “the top increment of their salary level”.

[6] Attachment 2 of the Agreement is the Salary Schedule. There are 11 Levels and each level has four Steps. Each step then has four rate prescribed increments, the first being the salary level as at 1/07/09 and three increments for each subsequent year. It is clear enough that “the top increment level” referred to in Clause 13.12 is the fourth Step of the relevant Salary Level.

[7] It is not disputed that the Applicant was appointed to the position of Senior Ranger in December 2011 and placed on the Salary Level of 5/6 at increment Step seven. The Agreement does not provide for a Level of 5/6. What the Agreement provides is for Level 5 which has four Steps, and Level 6 which also has four Steps. In December 2011, the Applicant then was appointed to a position with a Salary Level 6 at Step 3. In December 2012, the Applicant progressed to Step 4, the highest level of Salary Level 6. Thus, as from December 2012 the Applicant had reached the level where he satisfied the condition of Clause 13.12 that he had reached “the top increment of their [his] salary level”.

[8] Clause 13.12 also requires that the employee “meet” certain criteria. Those criteria are defined in paragraph 2 of this decision. The first criteria that the employee be at the top of their salary point has been met.

[9] The second criteria is that the employee must “be demonstrating exemplary performance”. The Applicant argues that he has met this criteria which is supported by his Performance Review undertaken in December 2012. The Respondent argues that the Applicant has not met this criteria. They argue that the approach that has been taken to assessing exemplary performance has been to make that assessment over a full twelve month period. The Respondents also argue that the meeting of this criteria is a discretionary judgement made by the Chief Executive Officer of the City upon advice from his executive team.

[10] The third criteria is that the employee must have been employed by the City for a minimum of eighteen months. It is not disputed that the Applicant met this criteria.

[11] The fourth criteria is that the employee has remained employed by the City. It is not disputed that this criteria has also been met by the Applicant.

[12] The Applicant did receive the allowance in March 2014, thus the only argument here is whether the Applicant met the criteria that “the employee must be demonstrating exemplary performance” for payment in March 2013.

[13] The Applicant called Mr Watkins, the Manager Ranger and Emergency Services to give evidence. Mr Watkins has been in his current position for about ten years. The Applicant since his appointment to Senior Ranger reported to Mr Watkins. Mr Watkins evidenced that he had made recommendations for payments of the allowance to his Executive Director. Mr Watkins was responsible for making recommendations regarding payment of the allowance to the Applicant for March 2013.

[14] Mr Watkins evidenced that his understanding was that the allowance should not be paid until the person concerned had been employed in the position for twelve months and that was the approach he had taken for the last ten years or so. He described the Applicant as a dedicated loyal officer at the City who provided a service within the bounds of his roles and duties as a Senior Ranger. He stated the Applicant goes over and above the requirements of his role to ensure the City was well represented and others could do well to emulate him.

[15] Mr Watkins undertook the Applicant’s performance review in December 2012. The score options and available for a review range from 1 to 5. With 1 being Unacceptable, 4 being Above expected level of performance and 5 being Exceptional. The Applicant received 7 scores of 4 and 3 scores of 5 from the 10 scores recorded. There are no employee comments at all and no action plans or performance targets. There are Supervisor comments for each score but nothing stands out in those comments that are indicative of the Applicant’s performance being “exemplary”. Indeed each of the supervisors comments appear to me to be indicative of performance that was at an expected level. Of the 10 scores recorded certainly 3 of those would, in my view, fall into the exemplary category as they are scores indicating an exceptional performance. However, the majority of scores are at an “above expected level of performance” and yet not at the Exceptional level.

[16] A letter, or statement, by Mr Watkins dated 29 July 2013 was tendered which stated that the Applicant “has provided exemplary service”. Mr Watkins evidenced that the reason the letter was written was because the Applicant had asked him to in order to support this application. It is therefore hardly surprising that having agreed to write the letter Mr Watkins would then, for apparently the first time, put to writing that the Applicant’s performance had been exemplary.

[17] It also seems that Mr Watkins did not recommend that the Applicant receive the allowance in March 2013 as he understood that the allowance was not payable unless the person concerned had been in the role for twelve months and that is the approach he had always applied for recommendations for the allowance. The evidence of Mr Watkins is a little confusing on this point because of a lack clarity of which years he was referring but it seems clear enough that he did not make a recommendation for the payment in March 2013.

[18] Ms Loveland, the Executive Director Community Services gave evidence. She stated that in March 2013 she did not consider the Applicant eligible for the allowance as the period of three months from December 2012 to March 2013 was not a sufficient length of time to demonstrate “exemplary performance”. She also stated that whilst the Applicant was performing well there were some concerns about some of the areas of his role including whether he was performing at a sufficient level for there to be confidence in his ability to perform some functions in the absence of the Manager, particularly in relation to emergency services.

[19] She also evidenced that she did not consider that the Applicant was performing all of the duties of the Ranger role, particularly with respect to Fire Safety and Emergency Management.

[20] Mr Watkins’ in his evidence stated that the Applicant had not been required to perform fire and emergency management duties. He stated that he viewed those duties in the Applicant’s duties statement were to enable the undertaking of those duties during periods when Mr Watkins was on leave. He was unaware whether the Applicant had ever undertaken those duties and considered he would struggle with some of them. Mr Watkins agreed that the ability of the Applicant to perform those elements of the duties were questioned by Ms Loveland but those concerns were not conveyed to the Applicant.

[21] Ms Loveland also evidenced that there had been some concerns about the performance of the Applicant and these had been raised with him at the time of his appointment to the position.

[22] The Chief Executive Officer, Mr Tame gave evidence. He stated that he made the decision on whether the allowance should be paid to a person. He stated that in the previous year 15 recommendations had been made and six were rejected as they did not meet the requirement of exemplary performance. He stated that the approach the City took was to make the assessment after there had been sufficient time after a person reaches the top of their level to be able to properly assess whether the performance met the standard of being exemplary.

[23] Mr Tame stated that whilst there were some concerns about the Applicant’s capacity to perform some of the duties he could be responsible for they were not deficiencies in the Applicant’s performance but nevertheless were relevant issues in consideration of whether his performance was exemplary.

Consideration and Conclusions

[24] The requirements of Clause 13.12 except for the criteria of “exemplary performance” are clear matters of fact and no judgement is involved. There are also no extra and obligatory conditions attached to ascertaining whether an employee did satisfy the criteria of having been exemplary.

[25] The Applicant is correct that a twelve month period at the relevant Level and Step is not a pre-condition to having access to the allowance. The Agreement does not require a minimum period, nor preclude payment unless there has been a minimum period, but neither does it require payment after achieving the relevant level and increment. What Clause 13.12 provides is the provision of an access to consideration for payment of the allowance. What the Agreement does not do is to prevent there being some guidelines established to assist in considering what is inevitably a subjective test. It is reasonable to establish a sufficient period of time in performing at the highest incremental step of the salary level which would have the effect of creating at least one objective element to the test and assist in creating a consistency of approach.

[26] Even if I am wrong in my approach to Clause 13.12 the facts here do not establish that the Applicant should be “entitled” to the payment. The consideration by the City has been fair and the City had some concerns about aspects of the capacity of the Applicant to fulfil some of the role to a standard that met the criteria of “exemplary”. Furthermore, I do not find that the Performance Review conducted in December 2012 by the Applicant’s Manager, Mr Watkins, supports the contention of the Applicant that his performance was “exemplary”. It seems to me that whilst the Applicant, in many regards, did perform his role well and in some aspects of it in an exceptional manner. In other aspects he fell short of meeting that standard, although not by much. That is a matter of judgement that is open to the City and provided it is applied consistently and fairly not something that I should interfere with. It is notable that the following year, that is March 2014, the allowance was paid to the Applicant.

DEPUTY PRESIDENT

Appearances:

Ms E McCarthy of the Australian Municipal, Administrative, Clerical and Services Union, for the Applicant.

Mr G. Scott of the City of Armadale, for the Respondent.

Hearing details:

2014.

Perth:

April, 15

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