John Schade v Able Australia Services T/A Able Australia

[2016] FWC 3466

[2016] FWC 3466

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

John Schade
v
Able Australia Services T/A Able Australia
(U2015/6020)

DEPUTY PRESIDENT KOVACIC CANBERRA, 27 MAY 2016

Application for relief from unfair dismissal – jurisdictional objection: genuine redundancy – objection upheld – application dismissed.

[1] On 19 June 2015 Mr John Schade (the Applicant) made an application under s.394 of the Fair Work Act 2009 (the Act) alleging that the termination of his employment on by Able Australia Services T/A Able Australia (the Respondent) on 29 May 2015 was unfair.

[2] The Respondent in its Form F3 – Employer Response to Unfair Dismissal Application raised a jurisdictional objection to the application, contending that Mr Schade’s dismissal was a case of genuine redundancy.

[3] The jurisdictional objection was heard on 26 November 2015 and 2 February 2016. At the hearing, Mr Peter Hull appeared with permission on behalf of the Applicant, while Mr Andrew Cameron appeared with permission for the Respondent. Mr Schade gave evidence on his own behalf. Mr Michael McIntosh, Human Resources Operations Manager; Mr Edward Holmes, General Manager, Corporate Services; Mr John Klug, National Manager – Disability Services; and Ms Kaye Collard, Chief Executive Officer (CEO), all gave evidence for the Respondent.

[4] For the reasons outlined below, I have found that Mr Schade’s dismissal was a case of genuine redundancy and therefore uphold the Respondent’s jurisdictional objection. Accordingly, Mr Schade’s application is dismissed.

Background

[5] The Respondent provides person-centred services to people living with multiple disabilities, including deafness, blindness and in-community support services 1. Mr Schade commenced employment with the Respondent on 7 April 2010 and prior to his dismissal was employed as State Operations Manager ACT. Mr Schade was employed under the Social, Community, Home Care and Disability Services Industry Award 20102 (the Award).

The Respondent contended that over the period October 2014 to January 2015 meetings of its National Management Team (NMT), which Mr Schade attended, were advised of the Respondent’s financial circumstances and that a restructure involving the loss of senior staff may occur.

[6] On 4 February 2015 Ms Collard outlined a proposed restructure at a meeting of the NMT. The minutes of that meeting state, inter alia, that:

“… KC [Ms Collard] spoke about the proposed restructure and stated that the proposal would be that the roles of State Operations Managers, being JS [Mr Schade], RH & JK [John Klug] would no longer exist ...

The initial impact would be on ACT, Tasmania & Victoria. KC went on to explain that the 3 State Manager positions would be replaced by one single manager and their title would be “National Manager Disability Services”. KC then distributed what the new proposed structure would look like. A new position description was also tabled.

…

KC then spoke about the restructure process. KC advised that she would meet with CJ, JS & JK on 4 February … This was acceptable by all.

These initial meeting were being held so that the 4 state managers could voice any suggestions, concerns etc about the proposed restructure. KC advised every one of the timelines for this process.

KC advised that the 4 SOM’s could apply for the new position and that there would be a formal recruitment process attached to this …” 3

[7] Ms Collard also met with Mr Schade on 4 February 2015. The record of that meeting, which was prepared by Mr McIntosh, states:

“… Kaye [Ms Collard] explained again the reasons for the restructure and the process going forward. Kaye advised John that it was for financial reasons why there needed to be a restructure.

Kaye explained the process surrounding the restructure and reiterated that ACT, Victoria and Tasmania State Manager positions would be made redundant and that there was to be a new position that would manage all 3 states and the new title would be National Manager Disability Services.

…

Kaye further explained to John that he could apply for the new position …

Kaye further explained that if John wasn’t successful he would be made redundant as position of State Manager ACT would no longer exist.” 4

[8] On 11 February 2015 Ms Collard sent an email to Messrs Schade, Klug and Hubbard (State Operations Manager Victoria) regarding the proposed restructure. The email read as follows:

“As you are aware, the consultation period ended at close of business on Monday 9 February 2015.

I have given full consideration to the comments and concerns raised by each of you and responded to them.

As a viable alternative has not been put forward, I have decided to proceed with the restructure in accordance with the proposal.

Details of the application process for the position of National Manager – Disability Services will follow shortly.” 5

[9] On 12 February 2015 Ms Collard emailed the affected State Operations Managers inviting them to apply for the position of National Manager – Disability Services. Both Mr Schade and Mr Klug applied for the position, with Mr Klug (at that time State Operations Manager Tasmania) ultimately the successful applicant.

[10] On 25 February 2015 Ms Collard emailed the Respondent’s staff announcing the national restructure. The email stated as follows:

“As you would be aware, we have been reviewing our management/staffing structure across the country to ensure Able Australia operates as effectively and efficiently as possible.

As part of this process, the current State Operations Manager roles in the ACT, Tasmania and Victoria have been made redundant and will be replaced with a single National Disability Services Manager role …

The role of ACT State Operations Manager, held by John Schade has been made redundant too, however he will assist Able with the transition of our ACT Houses to NDIS funding in the short term …” 6

[11] On 20 May 2015 Mr Schade was informed that his employment would cease by reason of redundancy. On 21 May 2015 Messrs Klug and McIntosh met with Mr Schade to discuss the cessation of his employment.

[12] On 26 May 2015 the Respondent sent Mr Schade a termination letter which stated, among other things, as follows:

“Termination of your employment by reason of redundancy

The purpose of this letter is to confirm the outcome of the recent review by Able Australia of its operational requirements, and what this means to you.

In accordance with previous discussions that you have had with Kaye Collard, CEO, and as a result of change in the operational requirements of Able Australia, the position of State Operations Manager ACT, is no longer required. As a result of this your employment will cease on Friday 29 May 2015.” 7

The Applicant’s case

[13] Mr Schade did not dispute that his position as State Operations Manager became redundant by virtue of the Respondent’s decision in February 2015 to consolidate the State Operations Manager positions in the ACT, Victoria and Tasmania into the National Manager Disability Services position. However, Mr Schade submitted that his termination was not a genuine redundancy as the Respondent had failed to comply with the Award’s consultation obligations. Mr Schade also contended that it would have been reasonable for the Respondent to redeploy him within its enterprise.

[14] Mr Schade further contended that on 2 March 2015 when Mr Klug commenced as the National Manager Disability Services he was in fact redeployed to a new role. More specifically, Mr Schade asserted that from that date he did not continue in his role as State Operations Manager ACT as his level of responsibility, along with his reporting relationships, had substantially and fundamentally altered. While Mr Schade conceded that his day to day tasks remained much the same as they had been prior to 2 March 2015, he submitted that from that date Mr Klug assumed the responsibilities which had previously fallen to him.

[15] At the hearing, Mr Schade contended that in this case the requirement that consultation take place after a definite decision regarding the restructure had been made was not met, nor was the requirement that details of the proposed changes be put in writing. Mr Schade reiterated his view that after 28 February 2015 his role as State Operations Manager ACT no longer existed and that he was provided with another job which came to an end following the cessation of the Weavell Place House arrangement. In support of that contention, Mr Schade highlighted that following implementation of the restructure he operated under different reporting arrangement and there had been a substantial change in his role in terms of the authority and power he exercised.

[16] Beyond this, Mr Schade:

• disputed that a definite timeframe for the duration of his “short-term” position was ever established;



• contended that he was offered a new position assisting Mr Klug for an indefinite period;



• it was not tenable to submit that his employment could continue indefinitely beyond the time his position had been abolished;



• submitted that while it might be accepted that his new position had been abolished because the Respondent did not want anyone to perform that role, his dismissal from that position was not a genuine redundancy because the Respondent did not comply with its obligations to consult;



• asserted that that the real reason he was dismissed was because he had become a thorn in the Respondent’s side;



• contended that the consultation clause in the Award required consultation to occur once a definite decision to implement changes had been made, adding that the consultation in this case all occurred before a definite decision had been made;



• submitted that he was given no notice that the issue of the proposed restructure would be discussed at the NMT meeting of 4 February 2015, arguing that as a result he was not provided with an adequate opportunity to consider an develop alternative proposals; and



• submitted that the decisions in Hanna Tyszka v Sun Health Foods Pty Ltd 8 (Tyszka) should not be followed in this case.

[17] Mr Schade provided two witness statements 9 in which he deposed, among other things, that:

• he did not disagree that his position as State Operations Manager ACT was abolished in early 2015;



• he had been informed by Ms Collard and Mr Klug that he was to be kept on as a consultant to provide advice on the NDIS transition;



• following Mr Klug’s appointment as National Manager Disability Services he had further discussions with Ms Collard about his position being made redundant, with the gist of those discussions being that he would be “looked after”;



• he understood that in his new role his key performance indicators required him to achieve savings of $20,000 per annum, adding that not long before he was dismissed he achieved a substantial saving of $36,000 per annum;



• he was totally surprised when advised by telephone on 20 May 2015 that his employment would be terminated, disputing that he was advised during that conversation that the Respondent was proceeding to finalise its decision to make his position of State Operations Manager ACT redundant;



• he believed the real reason he was dismissed was because he raised repeated concerns about the Respondent’s compliance with its contractual obligations to Disability ACT;



• he went away from the NMT meeting of 4 February 2015 not feeling that his position was in any danger, adding that he doubted the accuracy of some of the financial figures discussed at that meeting;



• his subsequent discussion with Ms Collard did not cause him to alter his thinking or to worry about his job security;



• he considered that if the restructure proposal outlined by Ms Collard at the NMT meeting of 4 February 2015 were to be implemented that there was a good chance he would be appointed as National Manager Disability Services; and



• he understood that the decision of Disability ACT to discontinue funding for Weavell Place House came about because Mr Klug had informed it that the Respondent no longer wanted to continue with the arrangement.

[18] Key aspects of Mr Schade’s oral evidence were that:

• it was not until 11 February 2015 that he realised that a decision had been taken to implement the restructure which had been discussed at the NMT meeting of 4 February 2015;



• he had difficulties with Mr Klug not being able to or willing to obtain an ACT working with vulnerable people permit;



• he considered the decision to relinquish Weavell Place House to be entirely unnecessary given that in the weeks before his employment ceased a majority of parents had indicated to him that they wished to remain with the Respondent;



• he expressed concerns to Ms Collard about the accuracy of the information prepared regarding the Respondent’s financial position, adding that he did not raise these concerns at NMT meetings;



• until late May 2015 he was not concerned about being made redundant because his belief was that that was not going to happen as he had been assured by Ms Collard that he would be looked after;



• the proposed restructure discussed at the NMT meeting of 4 February 2015 was put on the basis that this will be the outcome unless alternative proposals were put forward by NMT members, adding that he could not remember whether the timeframe for consultation was specified at that meeting;



• following implementation of the restructure he knew that his position was short-term, adding that he had continued to perform his job as he had done, that he remained on the same salary and retained his motor vehicle, laptop and mobile phone but that he was no longer able to make decisions affecting the ACT as he had to go through Mr Klug;



• his position as State Operations Manager ACT had been made redundant and ended on 28 February 2015; and



• he assumed his short-term position would continue until the end of December 2015.

The Respondent’s case

[19] The Respondent submitted that the Commission lacked the jurisdiction to hear the matter because it involved a case of genuine redundancy as per s.389 of the Act. The Respondent further submitted that it no longer required the position of State Operations Manager ACT to be performed by anyone, that it had complied with its Award obligations to consult about the redundancy and that it was not able to redeploy Mr Schade. The Respondent disputed Mr Schade’s contention that he was redeployed to another position.

[20] The Respondent also submitted that:

• Mr Schade’s evidence supported its contention that his position was made redundant, that he was aware of the redundancy and that the delay in the termination of his employment was only to assist it to manage the transition to the new structure;



• it consistently indicated to Mr Schade that his position was redundant and that his continuing employment was only a temporary, short-term arrangement;



• the timing of the decision to terminate Mr Schade’s employment on 29 May 2015 occurred due to a number of factors, including the year to date financial results for April 2015 which indicated a significant organisational deficit and an operating deficit in the ACT;



• with the loss of the funding contract for Weavell Place House the funding pressures became too great and it was no longer feasible for the Respondent to sustain Mr Schade’s redundant position;



• no assurances had been given to Mr Schade that his employment would be continue until the end of 2015 or into 2016;



• following the NMT meeting of 4 February 2015 and Ms Collard’s subsequent meeting with him, Mr Schade did not take up the opportunity to provide any feedback or submit any alternative proposals in writing as part of the consultation process;



• at the time of the restructure there were no comparable available roles for Mr Schade, adding that it was not in a position to create additional positions beyond the new National Manager Disability Services role; and



• Mr Schade was provided with an opportunity to explore redeployment but did not do so.

[21] In support of its submissions, the Respondent relied on the decisions in Tyszka to support its contention that it had complied with its consultation obligations under the Award.

[22] At the hearing, the Respondent submitted, among other things, that Mr Schade did not take advantage of the opportunity to consult on the restructure; had never been any given any promise that the continuation of his role would be long-term; and that it had complied with its Award obligations. In conclusion, the Respondent submitted that as Mr Schade’s dismissal was a genuine redundancy, the Commission had no jurisdiction to hear his application.

[23] Mr McIntosh provided two witness statements 10. Mr McIntosh deposed, inter alia, that he attended the NMT meeting on 4 February 2015 and each of the individual consultation meetings which Ms Collard had with the four State Operations Managers, adding that Ms Collard advised Mr Schade in her meeting with him on 4 February 2015 that if he was not successful in his application for the National Manager Disability Services role there were no other suitable positions available and that he would be made redundant. Mr McIntosh further deposed that he had no further involvement in the matter until 18 May 2015 when it was decided by Ms Collard and Mr Holmes, the Acting CEO at the time, that it was time to finalise the previously announced decision to make the position of State Operations Manager ACT redundant, adding that the closure of Weavell Place House in the ACT was critical to the timing of that decision.

[24] Key aspects of Mr McIntosh’s oral evidence were that he understood that Mr Schade was asked if he would stay on in the ACT for a short period of time after the restructure had been implemented to help Mr Klug transition into his position and that Mr Schade continued working in much the same way as he previously did. Mr McIntosh also attested that following the restructure Mr Schade reported to Mr Klug, whereas previously he reported directly to Ms Collard.

[25] Mr Holmes deposed in his witness statement 11 that the CEO issued a direction on 11 May 2015 to proceed with Mr Schade’s redundancy based on the Respondent’s financial position. Mr Holmes further deposed that on 20 May 2015 he and Mr Klug spoke with Mr Schade by telephone and advised him that the Respondent had decided to proceed to finalise its decision to make his position of State Operations Manager ACT redundant. Mr Holmes also stated that on 21 May 2015 Mr Schade rang him and among other things asked for five weeks’ pay to assist him to return to Tasmania. In his oral evidence, Mr Holmes disputed Mr Schade’s assertion that he had not contacted him on 21 May 2015. Beyond that, Mr Holmes attested that:

• he was not sure as to Mr Schade’s authority to expend money after he commenced reporting to Mr Klug;



• Ms Collard on 11 May 2015, prior to going on leave, directed him to bring Mr Schade’s employment to an end;



• there had been no significant increase in funding under the NDIS relative to the Respondent’s funding under Disability ACT; and



• Mr Schade was assisting Mr Klug in negotiating with the NDIS for funding for the Respondent’s ACT facilities, adding that Mr Schade had been retained for this purpose because, with the State Operations Manager Victoria also departing, there were some priorities in Victoria to be addressed by Mr Klug.

[26] Mr Klug provided two witness statements 12 in which he set out the chronology of events leading up to Mr Schade’s dismissal. Beyond this, Mr Klug deposed that:

• the notes of the NMT meeting of 4 February 2015 properly reflected the discussion at that meeting;



• based on his individual meeting with Ms Collard following the NMT meeting of 4 February 2015 he understood that he had the opportunity to provide feedback or alternative suggestions regarding the proposed restructure as part of the consultation process;



• from 2 March 2015 until the cessation of his employment on 29 May 2015, Mr Schade reported to him in his position of National Manager – Disability Services;

• during this period Mr Schade assisted him with the transition to the NDIS by continuing to perform the duties he previously undertook as State Operations Manager ACT;



• Mr Schade indicated to him that he would be interested in staying with the Respondent and was keen to explore ways that this could occur operationally;



• he was always clear with Mr Schade that any possibility of him persuading senior management to change its decision regarding his redundancy would require him to demonstrate that the ACT operations were financially viable and that any proposed role was sustainable;



• he did not give Mr Schade any promises, guarantees or assurance that his employment would continue on a permanent or ongoing basis until the end of 2015 or into 2016;



• at all times he was clear with Mr Schade that his role had definitely been made redundant and that his current work was only transitory in nature;



• he made it clear to Mr Schade that he did not have the authority to make a decision regarding his employment;



• on the day that Weavell Place House moved away from the Respondent he advised Mr Schade that his support for a change in decision regarding his position being made redundant would be difficult as the loss of this House simply made the ACT operations immediately unviable regardless of any other factors;



• the savings proposals that Mr Schade put together turned out to be misleading and his communication about these matters with the funding body resulted in negative feedback to the Respondent;



• he subsequently advised Mr Holmes that his view now was that the decision to finalise Mr Schade’s redundancy was difficult not to justify, adding that he was advised that Ms Collard had directed that Mr Schade’s redundancy be finalised as a result of the Weavell Place House development;



• in his view retaining the employment of Mr Schade would not have had any impact on the Weavell Place House decision; and



• based on his discussions with Mr Schade, he was in no doubt that Mr Schade understood there had been no change in the decision to make him redundant, that the arrangement of him continuing to perform his duties was short-term and only to assist with transition to the new structure.

[27] At the hearing, Mr Klug reaffirmed key aspects of his witness statement. Mr Klug also attested that:

• he had promoted the decision to discontinue Weavell Place House, adding that the decision was based around dignity and safety and against the background of Disability ACT having advised him that they had secured another provider and that the Respondent had 48 hours to get out;



• he was agreeable to discontinuing Weavell Place House because the relationship with Disability ACT, the parents and the residents had become irreversible;



• on the Monday prior to Mr Schade being advised that his employment was to cease, Mr Schade contacted him and told him that he had secured majority support of guardians for the Respondent to continue at Weavell Place House;



• Mr Schade’s advice in this regard was not correct as neither the parents nor Disability ACT supported the Respondent continuing at Weavell Place House;



• Mr Schade had raised with him concerns that he did not have an ACT permit for working with vulnerable people;



• he had advised Mr Schade in the week before the decision to end his employment was made that with Weavell Place House having gone it was going to be difficult to justify his position continuing;



• Mr Schade reported to him on financial decisions;



• Mr Schade was no longer a member of the NMT once he commenced as National Manager – Disability Services;



• there was more likelihood of him being able to support Mr Schade’s position continuing with Weavell Place House on board, however the Respondent did not wish to continue with Weavell Place House; and



• he was definitely told by Ms Collard when he met with her after the NMT meeting of 4 February that his position as State Operations Manager Tasmania was to be made redundant.

[28] In her two witness statements 13 Ms Collard provided a detailed chronology of events leading up to the termination of Mr Schade’s employment. That chronology is consistent with that set out above at paragraphs [7] to [13]. Ms Collard further deposed that:

• at the NMT meeting of 11 November 2014 Mr Holmes requested that each State Operations Manager prepare a brief action plan to report to the Board to address the major variance items in the year-to-date operating deficit of approximately $505,000;



• at the NMT meeting of 16 December 2014 Mr Holmes provided feedback from the Board meeting held on 15 December 2014 on the Respondent’s financial situation;



• she reiterated that the Board’s reaction to the Respondent’s financial position was not good and that, among other things, redundancies were to take place if required and that she would speak to all NMT members individually regarding possible cost savings, with any proposals put forward to be measurable and concrete;



• at the 14 January 2015 NMT meeting, Mr Holmes reported that the deficit figure of almost $950,000 was a conservative number and was likely to be worse by June 2015;



• at the NMT meeting of 4 February 2015 she outlined that a proposed restructure would be taking place as no immediate and productive action plans to reduce the deficit had been forthcoming from State Operations Managers, adding that the proposed restructure involved three State Operations Manager positions being made redundant and replaced by a National Manager;



• also at that meeting, she invited comments on the proposed restructure and advised that consideration would be given to all suggestions and comments received during the consultation phase;



• Mr Schade, who was present at all of the above meetings, did not provide her with any further feedback or alternative proposals during the consultation process;



• when she met with Mr Schade on 4 February 2015 she confirmed with him that he understood the proposed changes to the Respondent’s structure;



• on 24 February 2015 she advised Mr Schade by telephone that he was unsuccessful with his application for the National Manager – Disability Services role and that the redundancy process would commence;



• during that conversation Mr Schade mentioned that he would like to stay with the Respondent if there was a position, adding that she responded that she would assess whether there was a possibility of a different role being created once Mr Klug had reviewed the operational situation in the ACT but that his role as State Operations Manager ACT was redundant and there was no guarantee of another position;



• with regard to Mr Schade’s departure being delayed so that he could assist the Respondent with the transition of its ACT Houses to the NDIS, it was always her intention that this would be for a short period as she was well aware that the ACT office was operating a significant deficit and the decision to remove a senior management position was critical to reducing costs in the ACT;



• during March 2015 she and Mr Holmes prepared a confidential Action Plan Update for the Board intended to provide it with a progress report on the restructure and associated financial plan, with that report stating “SOM ACT retained for NDIS transition with other role being assessed in the organisation decision mid-April” 14;

this comment clearly reflected her intention that Mr Schade’s employment would only continue for the purpose of the NDIS transition;

at no stage did she make an offer to Mr Schade in regards to an alternative role as no such role ever existed with the Respondent;

on 25 March 2015 Mr Klug reiterated his request to keep Mr Schade on a little longer to allow him to get a better understanding of the ACT situation, adding that she agreed but explained that this arrangement was short-term with any longer term arrangement dependent on increased business in the ACT to ensure financial viability;

on 11 May 2015 she advised Mr Holmes and Mr Klug that it was time for Mr Schade’s position to be terminated in accordance with the restructure, adding that the impending loss of Weavell Place House cemented her decision in this regard; and

on 21 May 2015 she confirmed her agreement to finalising Mr Schade’s redundancy and terminating his employment.

[29] In her oral evidence, Ms Collard reiterated elements of her witness statements. Beyond that, key aspects of her oral evidence were that:

• at no stage did she guarantee Mr Schade a position, adding that she did say to him that she would look after him but that this was in terms of a redundancy package;



• after the restructure was implemented she did not offer Mr Schade a new contract of employment and did not describe his role as a consultant, nor was there are a different position description developed for Mr Schade’s post restructure role;



• the loss of Weavell Place House was the impetus for bringing Mr Schade’s employment to an end;



• after 2 March 2015 Mr Schade would have had to sought Mr Klug’s authorisation to expend money;



• she had given Mr Klug a timeframe about the assessment of the Respondent’s ACT operations, with that timeframe being until December 2015;



• in respect of Mr Schade’s employment, in her mind the timeframe was always going to be up until the end of June 2015;



• her understanding was that Mr Schade was working on the transition to the NDIS;



• the Respondent needed to save $500,000, with nine positions made redundant in Queensland in addition to the abolition of the three State Operations Manager positions;



• in her meeting with Mr Schade on 4 February 2015 she clearly articulated that the three State Managers’ roles would cease to exist on implementation of the new structure;



• at the NMT meeting on 4 February 2015 the proposed new structure was put as a proposal, with the Respondent’s decision to implement the proposed structure confirmed in writing on 11 February 2015;



• the NMT meeting of 4 February 2015 was an ad hoc meeting and as a result it was understandable that Mr Schade had no knowledge of what was to be discussed at that meeting;



• the decision to abolish the State Operations Manager ACT position was confirmed in writing in her email of 11 February 2015; and



• Disability ACT’s lack of confidence in Mr Schade was not a factor in the Respondent’s decision to terminate his employment.

The statutory framework

[30] The Commission exercises its discretion in relation to an application for an unfair dismissal remedy pursuant to Part 3-2 of the Act. In this case there is no contest that Mr Schade is a person who is protected from unfair dismissal pursuant to s.382 of the Act. In the context of this matter, the relevant provisions of the Act are therefore ss. 385 and 389 which read as follows:

“385 What is an unfair dismissal

A person has been unfairly dismissed if 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.

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.”

[31] There is no dispute that Mr Schade was dismissed, so s.385(a) of the Act is satisfied. Mr Schade contended that his termination was harsh, unjust or unreasonable, so s.385(b) is relevant. The Respondent is not a small business employer, therefore s.385(c) is not relevant. The Respondent contended that the termination is a case of genuine redundancy, so s.385(d) applies. Therefore, in determining whether Mr Schade was unfairly dismissed, I must first consider whether his dismissal was a case of genuine redundancy as per s.385(d of the Act). If so, dismissal was fair and his application will be dismissed. If Mr Schade’s dismissal was not a case of genuine redundancy, I will then need to consider whether his dismissal was harsh, unjust or unreasonable as per s.385(b) of the Act.

Was Mr Schade’s termination a case of genuine redundancy?

[32] As noted above, it was not disputed that Mr Schade’s position as State Operations Manager ACT was made redundant following implementation of the restructure. Accordingly, s.389(1)(a) of the Act is satisfied. Therefore consideration needs to be given to whether the requirements of s.389(1)(b) of the Act were met.

The employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy [s.389(1)(b)]

[33] The Award’s consultation clause provides as follows:

“8. Consultation

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 8.1(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 8.1(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.

8.2 Consultation about changes to rosters or hours of work

…”

[34] As noted by Vice President Watson at paragraph [19] in Maswan v Escada Textilvertrieb T/A ESCADA 15 (Escada):

“The requirement to discuss proposed changes and consult about the changes has been held to require meaningful consultation and not merely an afterthought. Consultation after an irrevocable decision has been made has been held to not amount to meaningful consultation.” (Underlining added, references not included)

[35] In Tyszka Commissioner Foggo determined as follows:

“[61] The Respondent did not completely follow the various requirements of clause 26 from the Agreement regarding consultation. This is certain in that the relevant information regarding the nature of the changes proposed was not put in writing to the employees or to the union in accordance with clause 26(iii). However the adherence to the clause was followed in the intent to truly consult over change and the chronology of events and the evidence shows that the company, the union and the employees were all participants in the change process.

[62] True it is that there were no discussions with the Applicant regarding redeployment to suitable alternative positions because there were no such positions. This is a relatively small company and it believed that it complied with the consultative requirements as it had dealt with the AMWU, the AiG and its employees throughout the process. I accept the submissions that it in substance it did comply.

[63] The fact that the company failed to commit the situation to writing as per the agreement does not obviate the regular contact it had with the relevant people and, in its totality, I find it complied with the consultative arrangements as provided for in the Agreement and is consistent with the provisions of the Act.” (Underlining added)

[36] The decision in Tyszka was upheld on appeal. In its decision determining the appeal the Full Bench stated:

“… We can discern no error by the commissioner. Essentially, the appeal boiled down to whether the requirements of section 389(1)(b) of the Fair Work Act 2009 had been met. That is, did the respondent comply with any obligation in the relevant enterprise agreement, to consult about the redundancy. The commissioner addressed this issue and found that there had been general compliance. There was no error in the commissioner’s finding. The lack of provision of materials, in writing, did not, in our view, render the consultation envisaged by clause 26 of the agreement ineffective, and it was upon that that Mr Dircks hinged his submission.

In our view, the requirements of section 389 subsection (1) subsection (b), as was said in the Ulan Mining case at paragraph 32, are met if there has been general compliance with award or enterprise agreement provisions regarding consultation.” 16 (Underlining added)

[37] As noted by the Full Bench in Ulan Coal Mines Ltd v Howarth 17:

“[29] The benefit of having discussions at an early stage of the process is that it will allow the employees an opportunity to influence such decisions and to put proposals as to measures to avoid or minimise the terminations and to mitigate any adverse effects of the terminations on the employees concerned.”

[38] An analysis of the material before the Commission in this case indicates that:

• on 4 February 2015 Ms Collard outlined at a meeting of the NMT attended by Mr Schade a proposed restructure of the Respondent’s operations;



• the proposed restructure involved the Respondent’s State Operations Managers positions in Victoria, Tasmania and the ACT being abolished, with the incumbents made redundant and the creation of a new role of National Manager – Disability Services;



• the minutes of that meeting indicate that Ms Collard “distributed what the proposed structure would look like” 18;



• Ms Collard invited comments on the proposal at the meeting;



• Ms Collard subsequently met with Mr Schade on 4 February 2015 to discuss the proposed restructure and again invited him to comment on the proposal;



• Mr Schade acknowledged in his oral evidence that the proposed restructure discussed at the NMT meeting of 4 February 2015 was put on the basis that it would be the outcome unless alternative proposals were put forward by NMT members;



• other than the questions Mr Schade asked at the meetings of 4 February 2015 regarding the proposed restructure, he did not submit any other comments and/or alternative proposals regarding the restructure;



• Mr Schade’s evidence was that he went away from the NMT meeting of 4 February 2015 and his subsequent meeting with Ms Collard not feeling that his position was in any danger and that he had a good chance of being appointed as National Manager – Disability Services should the role be created;

• Mr Schade attested that he was not concerned about his position being made redundant until late May as a result of the assurances he had been given by Ms Collard the he would be looked after; and



• the decision to implement the restructure and to abolish the State Operations Manager ACT position was confirmed in writing by Ms Collard on 11 February 2015.

[39] The Full Bench in Ulan highlighted the benefits of having discussion regarding changes at an early stage. In this case the material before the Commission indicates that the NMT meeting and Ms Collard’s subsequent discussion with Mr Schade on 4 February 2015 provided him with an opportunity, drawing on the language in Ulan, to influence the restructure and put proposals as to measures to avoid or minimise the terminations and to mitigate any adverse effects of the restructure. The fact that those discussions preceded a definite decision to implement the restructure and in the absence of the proposed changes being committed to writing as required by the Award does not in my view diminish the opportunity provided to Mr Schade to comment and have input into the restructure. As noted by Watson VP in Escada, consultation after an irrevocable decision has been made has been held to not amount to meaningful consultation.

[40] In short, the material before the Commission supports a finding that Mr Schade was consulted about the proposed restructure. Further, drawing on the decisions in Tyszka, that consultation involved the Respondent complying in general terms with its Award obligations to consult.

[41] As previously mentioned, Mr Schade contended that in the absence of any notice that the proposed restructure would be discussed at the NMT meeting of 4 February 2015 he had not been provided with an adequate opportunity to consider and develop alternative proposals. With regard to that contention, I would observe that in circumstances where Mr Schade attested that he did not consider his position was in any danger and that he was not concerned about his position being made redundant until late May, I doubt whether providing him with a further opportunity to comment on the restructure would have resulted in him coming forward with any substantive suggestions or alternative proposals to mitigate the impact of the restructure.

Would it have been reasonable in all the circumstances for the person to be redeployed within the employer’s enterprise or the enterprise of an associated entity of the employer? [s.389(2)]

[42] Mr Schade submitted that it would have been reasonable for the Respondent to redeploy him within its enterprise. However, Mr Schade did not point to any position with the Respondent to which he could have been redeployed.

[43] The Respondent, on the other hand, contended that it was not able to redeploy Mr Schade, that there were no comparable available roles for Mr Schade and that it was not in a position to create additional positions beyond the new National Manager Disability Services. The Respondent also contended that Mr Schade was provided with an opportunity to explore redeployment but did not do so. Further, Mr McIntosh under cross examination was unable to point to any positions which the Respondent was recruiting for in February 2015 19.

[44] As noted by the Full Bench in Technical and Further Education Commission T/A TAFE NSW v L. Pykett (Pykett) 20:

“[40] The Commissioner ... failed to make a finding that there was a job, a position or other work to which Ms Pykett could have been redeployed. Such a finding is a necessary step in reaching a conclusion that it would have been reasonable in all the circumstances for Ms Pykett to be redeployed within the appellant’s enterprise.”

[45] Based on the material before me, I am not satisfied that that there was a job, a position or other work to which Mr Schade could have been redeployed. Following the approach in Pykett, I am therefore unable to conclude that it would have been reasonable in all the circumstances for Mr Schade to be redeployed within the Respondent’s enterprise.

Conclusion

[46] The above analysis supports a finding that Mr Schade’s dismissal was a genuine redundancy.

Was Mr Schade transferred to another job?

[47] As previously noted, Mr Schade contended that he had been redeployed to a new role after the restructure was implemented. Mr Schade conceded in his submissions that his day to day tasks remained much the same as they had been prior to 2 March 2015 when Mr Klug assumed the role of National Manager – Disability Services but that from that date Mr Klug assumed the responsibilities which had previously fallen to him. More specifically, Mr Schade attested that following the restructure he continued to perform his job as he had done, that he remained on the same salary and retained his motor vehicle, laptop and mobile phone but that he was no longer able to make decisions affecting the ACT as he had to go through Mr Klug. Mr Schade also contended that he was offered a new position assisting Mr Klug for an indefinite period though in his oral evidence he contradicted this when he attested that following implementation of the restructure he knew that his position was short-term. Finally, Mr Schade deposed that he had been informed by both Ms Collard and Mr Klug that he was to be kept on as a consultant to provide advice on the NDIS transition.

[48] The Respondent disputed that Mr Schade had been redeployed to another position. Ms Collard’s evidence was that she did not offer Mr Schade a new contract of employment and did not describe his role as a consultant, nor was there a different position description developed for Mr Schade’s post restructure role. In addition, Ms Collard deposed that at no stage did she make an offer to Mr Schade in regards to an alternative role as no such role ever existed with the Respondent. Ms Collard also deposed that when Mr Schade indicated in a conversation with her on 24 February that he would like to stay with the Respondent if there was a position she responded that she would assess whether there was a possibility of a different role being created once Mr Klug had reviewed the operational situation in the ACT. Further, Mr Klug deposed that over the period 2 March to 29 May 2015 Mr Schade assisted him with the transition to the NDIS by continuing to perform the duties he previously undertook as State Operations Manager ACT.

[49] It is not disputed that Mr Schade’s day to day activities did not change after 2 March 2015 when Mr Klug assumed the role of National Manager – Disability Services. What did change was who Mr Schade reported to and his authority to expend money. In addition, Mr Schade was no longer a member of the NMT. With regard to whether or not Mr Schade was appointed to a new role, I prefer Ms Collard’s and Mr Klug’s evidence in this regard. That evidence is in my view supported by the Action Plan Update prepared in March 2015 by Ms Collard and Mr Holmes for the Respondent’s Board which stated “SOM ACT retained for NDIS transition with other role being assessed in the organisation decision mid-April” 21. Similarly Mr Schade’s evidence that he understood that in his new role his key performance indicators required him to achieve savings of $20,000 per annum, points to his role not having materially changed.

[50] The above analysis supports a finding that, on balance and despite the changed reporting arrangements, Mr Schade was not transferred to another job after the restructure was implemented. Accordingly, there was no need for a further round of consultation prior to Mr Schade’s dismissal.

Conclusion

[51] For all the above reasons, I am satisfied that Mr Schade’s dismissal was a case of genuine redundancy and therefore uphold the Respondent’s jurisdictional objection. Accordingly, Mr Schade’s application is dismissed. An Order to that effect will be issued in conjunction with this decision.

Appearances:

P. Hull for J. Schade.

A. Cameron for Able Australia Services T/A Able Australia.

Hearing details:

2015.

Canberra:

November 26.

2016.

Canberra:

February 2.

 1   Submissions on behalf of the Employer at paragraph 1.

 2   MA000100

 3   Submissions on behalf of the Employer at Attachment 4

 4   Ibid at Attachment 5

 5   Ibid at Attachment 6

 6   Ibid at Attachment 2

 7   Ibid at Attachment 9

 8   [2010] FWA 1781 and on appeal in Transcript of C2010/3328 at PN291-292

 9   Exhibits H1 and H2

 10   Exhibits C1 and C6

 11   Exhibit C2

 12   Exhibits C3 and C7

 13   Exhibits C4 and C5

 14   Exhibit C9

 15   [2011] FWA 4239

 16   Transcript of C2010/3328 at PN291-292

 17 (2010) 196 IR 32

 18   Submissions on behalf of the Employer at Attachment 4

 19   Transcript at 845-847

 20 (2014) 240 IR 130

 21   Exhibit C9

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