Job Site Recyclers Pty Ltd T/A Job Site Recyclers
[2024] FWC 2472
•12 SEPTEMBER 2024
| [2024] FWC 2472 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.120—Redundancy pay
Job Site Recyclers Pty Ltd T/A Job Site Recyclers
(C2024/4411)
| COMMISSIONER MIRABELLA | MELBOURNE, 12 SEPTEMBER 2024 |
Variation of redundancy pay – other acceptable employment.
On 1 July 2024, Job Site Recyclers Pty Ltd T/A Job Site Recyclers (the company) applied for an order under s.120 of the Fair Work Act 2009 (the Act) to reduce the redundancy entitlement of Mr Nathan Psaila to nil. Mr Psaila was employed principally as a truck driver and bobcat operator in the company’s business in cleaning up construction sites from 10 February 2015.
Mr Psaila worked for the company for nine years and three months, and there is no dispute that he will be entitled to 16 weeks’ redundancy pay pursuant to s.119 of the Act.
The company has applied to reduce Mr Psaila’s redundancy pay entitlement to nil because it found other acceptable employment for him as a Machine Operator and Truck Driver at Ecotrans Pty Ltd (Ecotrans). The location is 29 kilometres from Mr Psaila’s home. The company contends that this is ‘other acceptable employment’ for the purposes of s.120(1)(b)(i). Mr Psaila opposes the application.
Section 120 of the Act gives the Fair Work Commission (the Commission) the discretion to vary a redundancy pay amount to which an employee would otherwise be entitled under s.119 of the Act. Section 120 applies if the employee is entitled to an amount of redundancy pay under s.119 (s.120(1)(a)) and the employer either obtains ‘other acceptable employment’ or cannot pay the amount of the redundancy pay (s.120(1)(b)). The Commission’s discretion in s.120(2) to vary the redundancy pay to a specified amount (including a nil amount) that it considers appropriate can only be exercised if the conditions of s.120(1) are met. Where an order under s.120(2) is made, the reduced redundancy pay to which the employee is entitled will be the amount specified in the determination (s.120(3)).
In this matter, I need to consider whether the company obtained ‘other acceptable employment’ for Mr Psaila and if so, whether I should exercise my discretion to reduce his redundancy pay.
Background
The company is a business operating in the building sector in Melbourne cleaning building sites and recycling waste from these sites. It is not disputed that during the course of over a year, the company’s overall workload and revenue has been reduced by 80% and that bad debts are approaching $500,000. The company has suffered from being exposed to liquidations, predominantly that of Porter Davis Homes and the voluntary administration of Mahercorp Pty Ltd. Having operated three facilities with 150 staff, the company has reduced its staffing levels to a total of 23 and it has shut its depot located in Dandenong South, in the southeast of Melbourne where Mr Psaila worked. Only two staff are now employed in that region.
Additional costs the company has had to consider have been a foreshadowed increase in rent for the Dandenong South facility from $400,000 per annum to around $1.5 million per annum applicable from about January 2024. That site was vacated in January of this year as the company did not renew the lease. The company has obtained employment for dozens of employees from this site in companies similar to itself including Ecotrans. Mr Psaila was one of the company’s longest serving staff and one of the last four or five employees to be retained at the Dandenong South site until there was no work to sustain further employment. The company discussed the ‘predicament with Nathan regularly over the last year and [they] continued his employment for as long as [they] could until the workload dried up’.[1] At that time, on 10 May 2024, Mr Psaila began a period of long service leave. On the same day, Mr Psaila was emailed a formal job offer from Ecotrans. Mr Psaila was issued with a termination notice on 22 May 2024 and the company indicated they had work available for him during the four-week notice period. The notice period ended on 18 June 2024 and Mr Psaila served out the notice period whilst on long service leave. It is not disputed that Mr Psaila was paid all his entitlements and was provided with a ‘goodwill’ payment of four weeks’ additional pay, totalling $14,145.27.
Submissions
The company submits that it obtained other acceptable employment within the meaning of s.120 of the Act. The other acceptable employment was an offer for a position as a full-time Machine Operator and Truck Driver at Ecotrans at 14-20 Centre Road, Hallam in Victoria. The company submits that the pay, hours of work and job description were almost identical, that the location was about five kilometres closer to Mr Psaila’s home and, accordingly, the role they obtained was a suitable role. They seek that the redundancy pay entitlement of 16 weeks be reduced to nil. Other factors they rely on are the ‘goodwill’ payment of four weeks’ pay and that they had discussed the need for alternate employment with Mr Psaila over many months. Further, they submit that Mr Psaila told them that he did not want to pursue the employment with Ecotrans because he preferred to look for work in a different industry. Mr Psaila agrees that is what he said.
Mr Psaila submits that:
· The job offer at Ecotrans was not guaranteed full-time work because the letter of offer referred to the employment being ‘on an at-will basis’;
· There was no available public transport to get to Ecotrans;
· The hours of work had changed from 6:30am-3:00pm at the company to 7:00am-3:30pm at Ecotrans and this would prevent Mr Psaila from collecting his children after school at the bus stop in Warneet at about 3:35pm; and
· There is only one car in the family and his partner uses it to get to work in Botanic Ridge.
Mr Psaila gave evidence that his partner works three afternoon shifts per week with two additional shifts that alternate. He said that his partner sometimes leaves home at 3:45pm, and sometimes at 3:30pm, and has tried to adjust her starting time so that after work Mr Psaila could collect his primary school aged son from the bus stop in Warneet at the end of the school day. Mr Psaila said the bus stop was 500 metres to one kilometre from his home. When questioned, he gave further evidence that he did not make any enquiries about the job offer from Ecotrans and did not investigate the possibility of altering the start and finish hours to accommodate the school pickup.
The company submits that, originally, Mr Psaila would use his own vehicle to get to work, but that he later asked for assistance and the company allowed him to use an old company ute worth about $3,000 to get to work. They say that had Mr Psaila raised the matter of the need to have a vehicle as a prerequisite to accept the job at Ecotrans, they would have obtained one for him and reduced the goodwill payment of four weeks’ pay accordingly.
Consideration
There is no dispute that Mr Psaila’s position with the company is redundant and therefore he would be entitled to redundancy pay pursuant to s.119(1) of the Act. His employment was terminated by the company because his role was no longer required to be done by anyone.
The question of whether the other employment is ‘acceptable’ is an objective assessment. The ‘other’ employment will necessarily be different in some regard to the existing employment. In assessing whether other employment is acceptable, it is relevant to consider the differences between the existing employment and the role that has been offered by the company and accepted by Mr Psaila.
There is no dispute that the company obtained the employment offer for Mr Psaila whilst he was their employee. Discussions were made in good time before Mr Psaila’s employment was to end. The lease was not renewed in January, and he was one of the remaining four or five staff in the southeast of Melbourne with an obvious expiry date on the near horizon. The company had discussions with Mr Psaila regarding its financial predicament over the 12 months preceding the redundancy. The collapse of the many businesses in the construction sector was a notorious fact that had received significant media coverage. The company had discussions and had been placing staff in other jobs with Ecotrans and other companies from sometime in 2023.
The job obtained was for a full-time position with an immediate start. There is no contest that the pay, hours, conditions, role and seniority were almost identical between the job with the company and the job at Ecotrans. Mr Psaila’s comment that the job offer at Ecotrans was not the same because it had been described in the letter of offer as being on an ‘at-will basis’ does not make the job offer one of insecure employment. The confusion regarding the use of the term ‘at-will’ is understandable, but the fact is that Mr Psaila was offered a full-time position and was to be employed under the relevant award. The location of the other employment was five kilometres closer to Mr Psaila’s home than the company’s Dandenong South facility. A review of the relevant travel route on Google Maps does illustrate that it would not be practicable for Mr Psaila to use public transport to get to work. Mr Psaila says that his partner uses the family car to travel to work for predominantly afternoon shifts. In my view, an objective assessment of acceptable other employment must consider travel by a vehicle as well as public transport.
In the context of Mr Psaila’s comments that he was ‘sort of’ aware that the school bus could stop closer to home and further that his partner could adjust her work to leave Warneet at 3:45pm, I am not convinced that the changed finish time of 3:30pm instead of 3:00pm is a compelling factor in Mr Psaila’s favour. In any case, Mr Psaila had not made any enquiries about the job at Ecotrans and does not dispute that he did not want the job because he wanted to make the move to work in another industry.
The ‘other’ employment offered does not need to be the same as Mr Psaila’s position with the company. The question I need to answer is whether the other employment obtained for Mr Psaila by the company was objectively acceptable; that is, capable of being agreed to or suitable.
On balance, I find that the company did obtain ‘other acceptable employment’ for Mr Psaila for the purposes of s.120(1)(b)(i) of the Act.
Having satisfied the requirements of s.120(1), I must now consider whether to exercise my discretion to reduce Mr Psaila’s redundancy pay. In my view, and taking all the relevant matters into consideration, it is appropriate to reduce Mr Psaila’s redundancy pay.
Conclusion
I am satisfied that the company obtained other acceptable employment for Mr Psaila, and that in the circumstances I should exercise my discretion to reduce the redundancy pay to which he is entitled to nil.
An order will be issued separately reflecting this decision.
COMMISSIONER
Appearances:
Mr D. Reaper for the company.
Mr N. Psaila on his own behalf.
Hearing details:
11 September
Video using Microsoft Teams
2024
[1] Exhibit A2 of court book used during the 11 September 2024 hearing.
Printed by authority of the Commonwealth Government Printer
<PR779146>
0
0
0