Laurence John Goss & AMWU v Fluor Daniel Power & Maintenance Services Pty Ltd

DECISION NO: 27/96

C A T C H W O R D S

INDUSTRIAL LAW - TERMINATION OF EMPLOYMENT - whether VALID REASON for termination arising out of OPERATIONAL REQUIREMENTS of employer - whether genuine REDUNDANCY - whether termination HARSH, UNJUST OR UNREASONABLE - PROCEDURAL FAIRNESS - insufficient or no consultation with union and employees in compliance with Enterprise Bargaining Agreement and failure to give employees opportunity to be heard on current allegations of defective PERFORMANCE or CONDUCT resulted in terminations being HARSH, UNJUST OR UNREASONABLE - failure of employer to call witnesses and produce employment records where in its power to do so - the drawing of an adverse inference from such a failure - failure of employer to rebut presumption contained in s.170EDA(2) that two employees’ employment terminated by reason of their UNION ACTIVITIES - mere denial and proof of redundancy due to OPERATIONAL REQUIREMENTS insufficient proof - ONUS OF PROOF on employer to prove REINSTATEMENT impracticable

Industrial Relations Act 1988 ss.170DC, 170DE, 170DF, 170EDA, 170EE

CASES:Quality Bakers of Australia Ltd v Goulding and Another (1995) 60 IR 327
Kenefick and Another v Australian Submarine Corporation Pty Ltd 131 ALR 197
Sinclair v Anthony Smith & Associates Pty Ltd (unreported), von Doussa J, 1 December 1995, No. SI 1260 of 1995
Mitchell-Collins v The Latrobe Council (1995) 60 IR 480
Jones v Dunkel (1959) 101 CLR 298
Johns v Gunns Limited (1995) 60 IR 258

LAURENCE JOHN GOSS & AMWU - v - FLUOR DANIEL POWER & MAINTENANCE SERVICES PTY LTD
VI 2459 of 1995

JOE ANTHONY VISALLI & AMWU - v - FLUOR DANIEL POWER & MAINTENANCE SERVICES PTY LTD
VI 2463 of 1995

GRAEME LESLIE GILES & AMWU - v - FLUOR DANIEL POWER & MAINTENANCE SERVICES PTY LTD
VI 2464 of 1995

DONATO IERARDI & AMWU - v - FLUOR DANIEL POWER & MAINTENANCE SERVICES PTY LTD
VI 2468 of 1995

JOHN THOMAS METCALF & AMWU - v - FLUOR DANIEL POWER & MAINTENANCE SERVICES PTY LTD
VI 2469 of 1995

PETER JAMES ROBINSON & AMWU - v - FLUOR DANIEL POWER & MAINTENANCE SERVICES PTY LTD
VI 2470 of 1995

HAROLD STANLEY MITCHELL & AMWU - v - FLUOR DANIEL POWER & MAINTENANCE SERVICES PTY LTD
VI 2474 of 1995

RICHARD ALFRED GAUCI & AMWU - v - FLUOR DANIEL POWER & MAINTENANCE SERVICES PTY LTD
VI 2478 of 1995

NEVILLE PARR & AMWU - v - FLUOR DANIEL POWER & MAINTENANCE SERVICES PTY LTD
VI 2536 of 1995

Before:          Judicial Registrar Millane
Place:            Melbourne
Date:              8 February 1996

INDUSTRIAL RELATIONS COURT
OF AUSTRALIA
VICTORIA DISTRICT REGISTRY

VI 2459 of 1995
VI 2463 of 1995
VI 2464 of 1995
VI 2468 of 1995
VI 2469 of 1995
VI 2470 of 1995
VI 2474 of 1995
VI 2478 of 1995
VI 2536 of 1995

B E T W E E N :

LAURENCE JOHN GOSS &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

JOE ANTHONY VISALLI &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

GRAEME LESLIE GILES &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

DONATO IERARDI &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

JOHN THOMAS METCALF &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

PETER JAMES ROBINSON &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

HAROLD STANLEY MITCHELL &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

RICHARD ALFRED GAUCI &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

NEVILLE PARR &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

MINUTES OF ORDERS

Judicial Registrar Millane 8 February 1996

THE COURT DECLARES THAT:

The termination of the employment of Laurence John Goss and Harold Stanley Mitchell by the respondent contravened s.170DF(1)(b) and (d) of the Industrial Relations Act 1988.

The termination of the employment of Laurence John Goss, Harold Stanley Mitchell, Joe Anthony Visalli, Graeme Leslie Giles, Donato Ierardi, John Thomas Metcalf, Peter James Robinson, Richard Alfred Gauci and Neville Parr contravened s.170DE(2) of the Industrial Relations Act 1988.

AND THE COURT ORDERS THAT:

The respondent reinstate each of the applicants Laurence John Goss, Harold Stanley Mitchell, Joe Anthony Visalli, Graeme Leslie Giles, Donato Ierardi, John Thomas Metcalf, Peter James Robinson, Richard Alfred Gauci and Neville Parr by appointing each applicant to another position on terms and conditions no less favourable than those on which each applicant was employed immediately before the termination.

For all purposes the respondent treat each applicant as having been continuously employed by it from the date of termination to the date of reinstatement.

The respondent pay to each applicant the remuneration lost by each applicant because of the termination.

There be liberty to any party to apply to the Court on reasonable notice being given to the Court and all other parties to a proceeding concerning the calculation and the amount of the remuneration lost under s.170EE(1)(b)(ii) of the Industrial Relations Act 1988.

NOTE: Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules.

INDUSTRIAL RELATIONS COURT
OF AUSTRALIA
VICTORIA DISTRICT REGISTRY

VI 2459 of 1995
VI 2463 of 1995
VI 2464 of 1995
VI 2468 of 1995
VI 2469 of 1995
VI 2470 of 1995
VI 2474 of 1995
VI 2478 of 1995
VI 2536 of 1995

B E T W E E N :

LAURENCE JOHN GOSS &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

JOE ANTHONY VISALLI &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

GRAEME LESLIE GILES &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

DONATO IERARDI &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

JOHN THOMAS METCALF &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

PETER JAMES ROBINSON &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

HAROLD STANLEY MITCHELL &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

RICHARD ALFRED GAUCI &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

NEVILLE PARR &
AUSTRALIAN MANUFACTURING WORKERS UNION
Applicants

AND

FLUOR DANIEL POWER AND MAINTENANCE SERVICES PTY LTD
Respondent

Before:          Judicial Registrar Millane
Place:            Melbourne
Date:              8 February 1996

REASONS FOR JUDGMENT

During a six day hearing nine applicants and the union, the Australian Manufacturing Workers’ Union (AMWU), alleged that redundancies at the Loy Yang A and the Yallourn W Power Station sites from 7 April 1995 were not due to the operational requirements of the employer, were procedurally unfair and were, in any event, harsh unjust or unreasonable. On the lastmentioned points the argument was principally directed to the failure of the company to consult with the relevant unions and the employees about its decision to implement redundancies and to consult with the unions or their members on the development and application of the selection criteria for redundancy as well as matters of mitigation or minimisation of the effect of redundancies on the members of the workforce.

The employees also appeared to challenge the alleged use of conduct or performance matters relied on to select them for redundancy in circumstances where they had not been given the opportunity to contest the accuracy of any defect in conduct or performance recorded against them before it was used as a basis for selection. Further, it was alleged in respect to the applicants Laurence John Goss (Goss) and Harold Stanley Mitchell (Mitchell), both of whom were shop stewards (in Goss’ case up to two weeks prior to the redundancies) that the reason or at the very least one of the reasons for terminating their employment included a reason prohibited by s.170DF(1)(b) of the Industrial Relations Act 1988 (the Act). Because of the evidence called it is arguable that s.170DF(1)(d) was also breached. In other words, in the selection process they were discriminated against because of the time spent participating in union activities as representatives of the employees.

The respondent on its part denied the allegations made and set about establishing through the evidence that operational requirements had indeed caused and was the reason for some 62 redundancies across the two power station sites where it holds contracts to perform ongoing maintenance and project works. On balance the evidence supports a finding that, after some detailed analysis of the employer’s projected labour needs to meet its contractual obligations in early March 1995, the employer identified excess man power across the two sites totalling some 62 employees.

The evidence of the two site managers, Leslie Colin Brooke (Brooke) from the Loy Yang A site and David Bruce Thomson (Thomson) from the Yallourn W site, of the work undertaken by them to assess the labour and skills mix required at either site following the completion of the employer’s first year of an enterprise bargaining agreement was not seriously challenged, demonstrating as it did a need to reduce the permanent workforce to correlate with the hours of labour required to fulfil the company’s contractual obligations. Nor was there any serious challenge to the proposition that the redundancies were brought forward because the company’s client cancelled an outage at the Yallourn W power site originally scheduled for late March 1995. This cancellation was attributed to the continuing threat of industrial dispute arising out of the renegotiation of the extant Enterprise Bargaining Agreement (EBA) known as the Latrobe Valley Power Station and Manufacturing Plants Maintenance Enterprise Agreement 1993 (see Exhibit R18). It was agreed by the parties that the last EBA was the operational agreement at the time of the redundancies and the union and the employer were signatories to that agreement.

In arriving at the conclusion that the evidence establishes that this was a genuine redundancy I have had regard to Justice Beazley’s decision in Quality Bakers of Australia Ltd v Goulding and Another (1995) 60 IR 327 where Her Honour says at page 332 et seq:

“A redundancy will arise where an employer has labour in excess of the requirements of the business; where the employer no longer wishes to have a particular job performed; or where the employer wishes to amalgamate jobs: R v The Industrial Commission of South Australia; Ex Parte Adelaide Milk Supply Co-Operative Ltd (1977) 44 SAIR 1202 per Bray CJ at 1205; Gromark Packaging v FMWU (1992) 46 IR 98, per Franklyn J at 105. It is not necessary for the work to have disappeared altogether. As was said in Bunnett’s Case (Bunnett v Henderson’s Federal Spring Works Pty Ltd) (1989) AILR 356:
“Organisational restructuring may result in a position being abolished and the functions or some of them being given to another or split amongst others.” ”

In the present cases I am satisfied that as part of its operational requirements the employer identified excess permanent workforce to meet its ongoing contractual requirements and this had the consequence of a reduction in its workforce at each site.

At hearing the Court was informed that Fluor Daniel Power Services Pty Ltd the respondent originally named in all of the proceedings as the employer no longer exists. The entity Fluor Daniel Maintenance and Power Services Pty Ltd has assumed all the rights and liabilities of the original respondent. By consent the titles of the proceedings were amended and the new entity substituted as respondent to each proceeding.

BACKGROUND

It would be naive to ignore the history of industrial unrest and pressure on the very specialised workforce in the Latrobe Valley; instability to a large extent contributed to by the decision in 1993 of the SECV to hive off its generation activities to Generation Victoria, who, in turn, contracted maintenance services to private companies. In January 1995 Generation Victoria was itself broken up so that Loy Yang Power Ltd now owns and operates the Loy Yang site and Yallourn Power Ltd owns and operates the Yallourn W site. The history of disruption of the workforce is a significant background feature to the claims of the employees who all lost their longterm employment with the SECV in 1993 and, particularly the claims of the two shop stewards, who, because of the ongoing negotiations with the employer for a new enterprise bargaining agreement on terms and conditions favourable to the workforce, devoted a great deal of time to meetings with management to resolve contentious workforce issues.

It was agreed that in 1993 the respondent’s predecessor entered into an arrangement whereby it offered employment to the SECV employees at the two sites and that employment was secured for at least the period of the first EBA. The period of that agreement expired on 31 March 1995. Its renewal was the subject of intense and not always cordial negotiations from at least January 1995.

The applicant employees were amongst the many SECV employees who commenced employment in their various classifications with Fluor Daniel Power Services Pty Ltd. It (as does its successor) competed with other contractors in the Latrobe Valley to provide maintenance services, outages involving the shut down and overhaul of power stations and project work. As at the date of termination it had contracts with Loy Yang Power Ltd and Yallourn Power Ltd. To perform those contracts the employer engaged core permanent labour supplemented by casual labour where necessary. One of the issues raised by the applicants was that the redundancies were an attempt to shift the labour force to a casual workforce; rather than a genuine loss or reduction of jobs and the need for a particular skills mix. Whilst there is evidence that nearly all of the applicants have been employed as casuals since the date of the redundancies for varying periods there is no evidence to support a conclusion that any replacement permanent workforce has been engaged since the redundancies or that the respondent’s use of casual labour is such that it has simply replaced the redundant part of its permanent workforce with casual labour. I accept the evidence that the permanent labour force at the time of the redundancies was 135 at Loy Yang and 126 at Yallourn W and that labour force was increased particularly during any outage with a significant number of casual labour for the period of the outage. With the redundancies the permanent workforce was reduced at Loy Yang to 102 and at Yallourn W to 101 and is still supplemented by casual labour as is demonstrated by the use of casual labour in April 1995 to conduct the outage deferred from late March 1995 allegedly because the employer could not guarantee its client the performance of that outage work without industrial disruption. It was not contested that the overall reduction in the workforce at the Loy Yang and Yallourn W sites was 37 and 25 men respectively.

SECTION 170DC

The decision of Chief Justice Wilcox in Kenefick and Another v Australian Submarine Corporation Pty Ltd, 131 ALR 197 (the ASC cases) was relied on by the employer to, amongst other things, counter any suggestion that the procedural fairness provision of the Act, s.170DC, was contravened and such contravention could be relied upon by the applicants in the circumstances of the cases before this Court. It should be kept in mind that the ASC cases are the subject of appeal to the Full Court and such appeal was heard on 8 December 1995 with a decision yet to be handed down. Nonetheless the decision of the Chief Justice is presently binding on this Court. My understanding of that decision specifically on the application of s.170DC to redundancies is that to be lawful a termination must comply with the relevant statutory provisions. Where there is more than one reason for termination, for instance, a reason related to an employee’s conduct or performance as well as there being a reason related to redundancy the principle may apply. However, in the ASC cases it was inapplicable because there was, on the facts, only one reason for redundancy and that was so notwithstanding the evidence that the employees were selected by reference to conduct or performance characteristics the employer believed made them less valuable to the employer. They were assessed on their relative merit but not on any current allegation regarding their conduct or performance. In other words, the only reason for the termination was the redundancy situation.

Putting to one side the allegations of the two shop stewards pursuant to s.170DF(1) of the Act, my finding that the reason for termination was a genuine redundancy and was apparently the only reason for termination, where matters of conduct or performance are used to test the employee’s relative merits, I am bound by the authority of the ASC cases to conclude that s.170DC has no application to these cases.

However, notwithstanding the abovementioned findings reliance on defective performance or conduct in making a selection for redundancy may be procedurally unfair pursuant to s.170DE(2) of the Act where an employer records or acts on some defect in performance or conduct and uses that without having first given the employee the opportunity of challenging the accuracy of the allegation.

As was observed by the Chief Justice at page 211 of his decision on any challenge to the accuracy of some conduct or performance defect the finding of an impartial reviewer may be taken into account in selection. On the facts of the cases before me it is the employees’ challenge to any allegation of defect in performance or conduct which appears not to have been properly addressed before these matters were used as a basis for selection for redundancy and that raises a question of procedural fairness under s.170DE(2) of the Act. For example, if an employee’s record shows that he has taken unauthorised leave and this is a current allegation affecting his relative merits in the selection process, natural justice requires that he be allowed to challenge the accuracy of such an allegation.

CONSULTATION AND S.170DE(2)

Consultation in the context of procedural fairness requirements contemplates at least two elements: forewarning and discussion; permitting as it should proper consideration of selection criteria and measures to minimise or mitigate any adverse affects of redundancy.

It was argued by the employer that at the unionised work sites the employer usually negotiated with the various unions rather than directly with the members. This arrangement was allegedly characterised by the negotiations between the union representatives and the employer since January 1995 for a new EBA. Because of this practice it was not surprising, according to the employer’s argument, that there was no direct approach to its workforce forewarning the employees that there was to be something in the order of a 38% retrenchment of the joint workforce in the first week of April 1995, before it decided to implement redundancies and select those who were to be made redundant; informing them of that outcome on Wednesday, 5 April 1995. The effective date for termination was the following Friday, 7 April 1995. In summary actual notification of the decision to terminate and the identification of the employees made redundant were given simultaneously to the employees and the union representatives on 5 April 1995 to take place on 7 April 1995.

Clause 5.7 of the relevant EBA deals with redundancy and provides:

“5.7.1 Discussion Before Termination

(a)Where Fluor Daniel Power Services has made a definite decision that Fluor Daniel Power Services no longer wishes the job the employee has been doing done by anyone and this is not due to the ordinary and customary turnover of labour and that decision may lead to termination of employment, Fluor Daniel Power Services shall hold discussions with the employees directly affected and with their union or unions who are party to the Agreement.

(b)The discussions shall take place as soon as is practicable after Fluor Daniel Power Services has made a definite decision which will invoke the provisions of subclause 5.7.1(a) hereof and shall cover, inter alia, any reasons for the proposed terminations, measures to avoid or minimise the terminations and measures to mitigate any adverse effects of any terminations on the employees concerned.

(c)For the purpose of the discussion the Fluor Daniel Power Services as soon as practicable, provide in writing to the employees concerned and their union or unions, all relevant information about the proposed terminations including the reasons for the proposed terminations, the number of categories of employees likely to be affected, and the number or workers normally employed and the period over which the terminations are likely to be carried out. Provided that Fluor Daniel Power Services shall not be required to disclose confidential information the disclosure of which would be inimical to Fluor Daniel Power Services.”

It is alleged by the applicants that the terminations were procedurally unfair because amongst other things there was a failure by the employer to comply with the abovementioned provision of the EBA. Significantly, the applicants argue, the employer by its conduct if not intent concealed its preparations for the redundancies in not disclosing that it had, by mid March 1995, identified an excess in its workforce requirements and set about creating and implementing selection criteria for redundancies. The lower echelons of management such as some of the superintendents and supervisors were involved in the selection process but certainly not privy to information about the number and identity of employees to be made redundant and when the redundancies were to occur.

Charlie Dennis Smith (Smith) is the respondent’s operations manager since August 1993 and the person ultimately responsible for putting together the selection criteria and implementing the redundancies. It was his evidence that over a long period of time, going as far back as June 1994, the unions and the employees had been made aware that there was a need for a reduction in the workforce numbers.

In approximately December 1994 one of the employer’s competitors, Transfield, was involved in an industrial dispute with its employees arising out of compulsory redundancies. As a consequence the employer’s workforce took supportive industrial action. By letter dated 21 December 1994 and a notice of the same date containing the same statements (see Exhibits R1 and R2) the employer gave notice to, amongst others, the union organisers and shop stewards stating that:

“In conformance with our discussions in relation to forced personnel reductions, Fluor Daniel Power Services anticipates having sufficient work to preclude forced personnel reductions until at least March/April 1995.
The above noted work includes minor and major outages at Yallourn W Power Station, minor outages and capital related work at Loy Yang A Power Station, and a major outage at Jeeralang Power Station.
It is critical that there is acceptance that full utilisation of the current workforce is contingent upon the outages and capital works occurring during this timeframe and being accomplished without disruption.
Beyond this period Fluor Daniel Power Services will determine manpower needs as required to meet our business commitments. In any event Fluor Daniel Power Services will attempt to minimise forced reductions, in conformance with the Enterprise Bargaining Agreement.”

Smith explained the significance of the reference to March/April 1995 in the documents by saying:

“... the industrial actions were taken against Transfield and our people went out in support of that, and they stayed out approximately nine days, I believe that and I am not quite sure about the days that that this letter was written to the unions to let them know that we were not going to plan any redundancies before the April or March time-frame of 1995, one of the reasons being because it was an agreement made between the unions and the SECV that they would not require any redundancies until the expiration of the first EBA negotiated agreement.”

Further in a letter dated 8 March 1995 sent to the organisers of the involved unions the employer said:

“As previously agreed, Fluor Daniel Power Services would not be moving to re-align its workforce requirements prior to the March/April period.
I now advise the process to consider our requirements for labour to meet contractual commitments to our clients has commenced. This will, I expect, result in redundancies.
I, therefore, seek an urgent meeting with you within the next 72 hours in order to discuss this issue.”

According to Smith, and this was borne out by the evidence called by the applicants, the unions notified in this way failed to appreciate that the employer was actually then proceeding to address the need to immediately reduce its workforce, quite apart from any position it took in the EBA negotiations. The unions were engaged in numerous and lengthy meetings with the employer in that period and from their point of view the employer was endeavouring to use the issue of possible redundancies as a lever in the protracted negotiations for the new EBA. The terms of the new EBA were not agreed upon until April 1995 after the redundancies had been effected and following a further agreement reached through conciliation; touching as it did upon matters in mitigation of the effects of the redundancies as well as the EBA negotiations (see Exhibit R6).

Even though there was no direct response from the unions to the letter of 8 March 1995 the employer contends that subsequent to that letter and before the terminations were effected the issue of redundancies was raised with the union representatives at subsequent meetings as well as being brought to the unions’ attention when notice was given to the workforce on 30 March 1995 seeking voluntary redundancies (see Exhibit R14). The notice informed the workforce of the following matters:

“As previously discussed with you during Employee meetings, it has always been Fluor Daniel’s position to, as far as possible, establish stable amounts of work. However it has always been made clear that if the quantum of work changed it would be necessary to adjust the work force to meet the needs of the Business.
Therefore at this time, any employee who would consider a voluntary departure, the company is offering the equivalent of the Retrenchment Package as per the terms of the Enterprise Agreement.
If we are unable to reduce to a level which matches our works program through voluntary redundancies or alternative employment placement, we will move to compulsory redundancies.
In addition the company will continue to explore other avenues in order to minimise the impact of retrenchments on our workforce.”

The notice received no takers.

Following the letter dated 8 March 1995 Smith alleges, and this is not denied, that at an EBA meeting with the union representatives he produced a document he described as a “flow chart” (see Exhibit R12). According to Smith this is a document he obtained from his solicitors showing in a chart form the steps necessary to comply with the Act to effect a lawful redundancy. The purpose of producing this document was to, so far as Smith was concerned, again bring to the unions’ attention the fact that the company was then looking at reducing the costs to its client and the number of its workforce. At that time he claimed that, whilst the employer had been able to ascertain that it was going to reduce its workforce by “a considerable amount”, it had not then identified the exact number and the persons affected. Although the employer may not have by then selected the men to be made redundant, Smith’s evidence is otherwise contradicted by the evidence of Thomson and Brooke that the numbers of the excess workforce in each employee classification were known to the employer’s management from no later than mid March 1995 and, were certainly known by the time the selection criteria was developed and applied. Moreover, he conceded in cross-examination that when the flow chart was presented to the union representatives there was a request by one union representative to have direct input into any process used to effect redundancies.

Central to the employer’s argument that it abided by the spirit, if not the letter, of the EBA in endeavouring to initiate discussions on redundancy with the union representatives is its witnesses’ belief that the unions did not want to discuss redundancy; allegedly not being concerned about this. This proposition, however, is incompatible with the unions’ high industrial profile at the time while negotiating the future employment terms and conditions of their members; not to mention their industrial activities in December 1994 directed to the compulsory redundancies imposed by Transfield on its workforce in the Latrobe Valley. It would be more accurate to say that the potential need for redundancies was clearly an issue in the workplace and was regarded as being inseparable from the EBA negotiations. However, the employees and the unions, in the absence of any specific indication of the number the employer had identified as being in excess of its needs, the selection criteria it intended to apply and the date upon which the redundancies were to take affect, saw no immediate need to separate this issue from the negotiations for the terms of the new EBA.

It is inconsistent for the employer to suggest that on the one hand it sought open discussions of impending redundancies and to then set about implementing the redundancies without letting either the unions or the workforce know what percentage of the workforce was under threat, what process was being used to select employees for redundancy and, further, not tell them that the selection process was then being applied with a view to implementing redundancies immediately. Smith accepted that any steps taken with the unions and the employees to mitigate or minimise the affects of the redundancies were taken after the redundancies were notified to the employees on 5 April 1995 as a fait accompli. Such action being entirely consistent with a decision to limit union and employee participation in the redundancy process and a specific decision made by the employer not to discuss the selection process allegedly because of the negative response it received to a written performance appraisal sent for completion to each employee by 7 March 1995.

Clearly the unions received through the correspondence sent and the employer’s numerous references to the need to reduce its workforce, forewarning of the possibility of redundancies in the March/April 1995 period. The evidence of each of the applicants also supports a finding that they were generally aware, through anecdotal accounts within the workforce, that compulsory redundancies might occur, but they were not formally forewarned until the decision had been made and implemented. The seeking of voluntary redundancies by notice given on 30 March 1995 in no way forewarned the workforce that up to 38% of the men employed would need to depart voluntarily if compulsory redundancies were to be avoided in the immediate future.

Insofar as consultation involves discussions aimed at measures to minimise and mitigate the adverse affects of redundancies these discussions were forestalled by the actions of the employer. What steps the employer did take to mitigate or minimise the adverse consequences; such as writing to other employers in the Latrobe Valley on 30 March 1995, were taken without the knowledge or input of either the unions or the workforce (see Exhibit R3). On the morning of 5 April 1995 the unions and the employees received written notification of the terminations for the first time. The notification to all the applicants took the following form (see Exhibit R5):

“Following a review of our works program, Fluor Daniel Power Services finds that it is carrying an excess number of employees for its ongoing requirements.
Attempts have been made to avert retrenchment of employees, but these have been unsuccessful.
Unfortunately, this means that your employment will be terminated, effective from close of business, Friday 7 April 1995.
At that time, your Termination Payment equivalent to 4 weeks pay plus 2 weeks in lieu of notice and other entitlements will be paid by cheque on Friday. This weeks wages will be paid into your bank account as normal.
From today, a Job Search Assistance Program will be available to you, as well as Personal Counselling, if required.
If you so decide, you may finish your employment at any time before Friday and be paid as if you worked up until that time.
You are also entitled to take paid time over these three days in order to look for work, if you do not choose to utilise the Job Search Program.
Your Union is currently being consulted about this matter.
In conclusion, I would urge you to take advantage of the Job Search services and Personal Counselling, as appropriate.
Furthermore, if you need, Fluor Daniel Power Services is prepared to consider you for future employment opportunities. Additionally, we will continue to attempt to identify alternative employment opportunities.”

The notification (Exhibits R4 and R8) to each of the unions at the two sites was identical save for the name of the site and the numbers of employees involved. Exhibit R4 sets out the notification given as follows:

“Further to previous correspondence about the possibility of retrenchments occurring within our workforce, I hereby formally advise your organisation that Fluor Daniel Power Services will be terminating employees at our Yallourn W Power Station Site, effective from the close of business on Friday 7 April 1995.
This is due to a significantly reduced workload which is impacting structurally and economically on the operations of this company at that site. The number of employees normally employed at the site is 126. The numbers and categories of employees to be affected are -
Fitters  3
           Boilermakers  8
           Maintenance Worker 1       7
           Maintenance Worker 2       3
           Maintenance Worker 3       3

Measures to avert the terminations have been considered, including the offering of Voluntary Redundancies, the examination of retraining options for employees into other categories of work and the transfer of employees to lower paid duties.
Furthermore, measures such as the seeking of alternative employment, have been taken to mitigate the adverse effects of the terminations.
As from today, Fluor Daniel Power Services will be providing a Personal Counselling Service and a Job Search Assistance Program for affected employees.
Fluor Daniel seeks to consult with your representatives on Wednesday 5 April and Thursday 6 April 1995, as necessary on this matter, prior to the terminations taking place on 7 April 1995.
Termination terms and conditions will be as agreed in the relevant clauses of the ‘The Latrobe Valley Power Stations and Manufacturing Plants Maintenance Enterprise Agreement 1993’.
Fluor Daniel Power Services is advising the employees who are affected by this decision, concurrently with this correspondence.
Please do not hesitate to contact me for any further information on this matter.”

It is noteworthy first that the opening remarks in the letter to the unions refer to the “possibility of retrenchment occurring” confirming that this was the first notification of the decision to effect redundancies and, secondly, that the employer gave no evidence of what measures it took to avert the terminations by examining “retraining options for employees into the categories of work and the transfer of employees to lower paid duties.” More importantly the employer seeks to consult with the unions “as is necessary” before the terminations two days later. The only reasonable conclusion to be drawn from this invitation to consult is that the employer sought by this process to comply with clause 5.7.1 of the EBA, the suggestion being that any “definite decision” to terminate was only made on the evening of 4 April 1995 when the site managers presented management with a list of employees then identified by the selection process for redundancy. As at 5 April 1995 the employer obviously did not itself view its earlier correspondence and alleged attempts to alert the unions to the fact of imminent redundancies as complying with the EBA requirements for consultation and discussions.

In his recent decision in Sinclair v Anthony Smith & Associates Pty Ltd (unreported) 1 December 1995, No. SI 1260 of 1995, Justice von Doussa said at page 6 that the redundancy of a shift supervisor:

“... was harsh, unjust or unreasonable on account of a failure to follow the appropriate procedures to bring about that termination. The most significant factor in my view is a failure to follow the requirements of clauses 37 and 38 of the Award, the objects of which are the same as those reflected in clauses 19 and 25 of the Termination of Employment Recommendation set out in Schedule 11 to the Act.”

In Sinclair’s case a number of redundancies occurred as a result of a restructure of the employer’s business. Clause 38 of the Award provision referred to in Sinclair’s case, but for some slight variation in its wording, mirrors the wording of Clause 5.7.1. of the EBA applicable to the present cases. For the sake of making the relevant comparison Clause 38 is reproduced as follows:

“Clause 38.

(1) Redundancy in this clause means the loss of employment due to the employer no longer requiring the job the employee has been doing to be performed by anyone.
(2)Discussions before Termination

(i) Where an employer has made a definite decision that the employer no longer wishes the job the employees have been doing done by anyone and that decision may lead to termination of employment, the employer shall have discussions as soon as practicable with the employees directly affected and with the Union or Unions. Discussions shall cover, among other things, the reasons for the proposed terminations, measure to avoid or minimize the terminations, and measures to mitigate the adverse effects of any terminations on the employees concerned.

(ii) For the purposes of discussion the employer shall as soon as practicable provide in writing to the employees concerned and the Union or Unions all relevant information about the proposed terminations including the reasons for the proposed terminations, the number and categories of employees likely to be affected, and the number of workers normally employed and the period over which the terminations are likely to be carried out. Provided that any employer shall not be required to disclose confidential information the disclosure of which when looked at objectively, would be inimical to the employer’s interests.”

His Honour having set out the abovementioned clause made the following observations:

“The clause required consultation both with the employees and the union once a definite decision had been made that the respondent no longer wished the job of the employees to be performed. That definite decision was made at least some weeks in advance of the advice of the decision to the employees. Had advice been given to the persons concerned, in particular the three shift supervisors and the union, the opportunity would have arisen for discussion. Counsel for the applicant asserts that it should be concluded that had discussion occurred it would have been possible to reorganise the forming department in which the applicant worked so as to utilise the skills of the shift supervisors, who were the longest serving employees in that department, and, it may be inferred, who had substantial training and experience.

I do not think that conclusion can be drawn in such positive terms. On the other hand I do not think it can be concluded that the position would not have been any different had there been due consultation with everyone concerned. I think the evidence shows that the position may have been different had the Award provisions been followed, it cannot be held that it was more probable than not that the applicant’s employment would have continued.
The requirement for consultation is in the Award not only to permit the possibility of arriving at some rearrangement of the workplace which has lesser consequences than dismissal, but also to allow time for the employees to deal with the emotional, family and domestic stresses that are likely to descend upon them when their employment is brought to an end. The importance of those non-workplace personal factors cannot be underestimated, and finds expression in the reasons of various tribunals that have had to consider clauses of this type. To put it into colloquial terms, it is desirable, as the Award recognises, that employees whose security of employment is about to be shattered be let down gently. If they are forewarned and counselled they are more likely to be able to accommodate to their new situation, to adjust themselves to the search for other work, and the like. Moreover, it is generally recognised that if an employee is in work and is given time off to go and look for other work, the prospects of finding new employment are somewhat better than if the person concerned is required to seek work as an unemployed person on social security. The failure to consult is a significant matter in this case. In my view it was also significant that no forewarning was given, and significant also that no counselling was provided. Those are matters that should have been attended to, to render the dismissal in the circumstances of this case, reasonable and fair.”

In an earlier decision, Mitchell-Collins v The Latrobe Council (1995) 60 IR 480, His Honour Justice Spender had occasion to deal with award provisions again not dissimilar to clause 5.7.1 of the EBA and said at page 490 et seq of that decision:

“There is, however, a need for consultation with employees, and in cases such as the present, with the employees’ union. So much is clear from the terms of the award to which I have previously referred. The reason for the need for such consultation is reflected in the observation concerning technological change made by the Full Bench of the Commonwealth Conciliation and Arbitration Commission (1968) 122 CAR 339 at 344-5 where it said:
“When employers are contemplating the introduction of computers and other automatic devices which may have serious effects on employees such as termination of employment or transfer interstate it is essential that both the employees and the union concerned should be informed of and involved in the planning as soon as possible. Many real human problems may be involved which may not be known to company executives and they, with the best will in the world, may take steps which do not help to solve them. It is our view that employees and their welfare are as important in the planning of a change of the kind we have had to consider as any other aspect of the change and that they, both individually and through their union, should be brought in at the planning stage. When brought into the planning both employees and the union should in their turn attempt to understand the problems which the employer faces and co-operate with him to try to find a reasonable solution.”

Wilson J referred to this passage approvingly in Federated Clerks Union v Victorian Employers’ Federation (1985) 54 ALR 489. He said at 511:
“Consultation between employers and employees, preceded by the distribution of adequate information is not only sensible but essential if commerce and industry are to meet the challenge of progress in a spirit of harmony and with some regard for human dignity.”

The principle of fairness which these passages highlight was considered in detail by Beazley J in the Quality Bakers case to which I have referred. Her Honour reviewed the authorities, including White v Douglass Diagnostic (1993) 60 SAIR 142, the well known observations by Stanley J in Corkrey v General Motors Holdens Limited (1986) 53 SAIR 531; Wynn’s Winegrowers Pty Ltd v Foster (1986) 16 IR 381 at 384; and Cheesman v Kinhill Engineers Pty Ltd (1992) 59 SAIR 168. In the latter case, Perry C said that the Corkrey guidelines were:
“Equally appropriate to redundancy arising in circumstances of economic stringency or restructuring.” ”

Relying on the facts of the case before him, Justice Spender found (at page 25) that:

“The required consultation with the employee was completely absent and consultation with the union was late and inadequate.”

Unlike the Sinclair and Mitchell-Collins cases, in the cases at hand there was on the evidence some generalised attempt to forewarn the union representatives that redundancies may occur in the near future. Each applicant was, at least, as a result of hearsay comments either at tool box meetings or around the workplace, aware that there may be a need for redundancies in the future but were not, until the redundancies were notified to them on 5 April 1995, formally notified, forewarned or consulted with. So far as counselling is concerned that was offered to the employees on the date they were notified; that is to say two days before the redundancies took effect and after the decision had been implemented.

The employer relied principally on the decision of Chief Justice Wilcox in the ASC cases. The ASC cases concerned up to 40 redundancies from a total workforce of 546 production employees and staff after it became apparent that the employer was overmanned, having missed out on additional work orders from the Department of Defence.

In contrast to the present cases in the ASC cases the employer immediately consulted with the relevant unions giving an estimate of the number of redundancies involved, yet also insisted that, in accordance with the applicable EBA, its management make the choice of what workers it made redundant. The inference being that the employer would select by reference to its own needs.

There were Award provision in the ASC cases, again mirroring Clause 5.7.1. of the EBA applicable in the cases before me. However, unlike these cases the Australian Submarine Corporation had negotiated an EBA which conflicted with the Award provisions; in that it clearly allowed the employer the right to “... determine which employees are to be made redundant giving due regard to appropriate consultation processes.” Two points of significance emerged from this supervening agreement. The first was that the employer appeared to have the exclusive right to determine which employees were to be made redundant and, the second, was that there was no provision in the EBA similar to that contained in the relevant Award clauses providing for union participation in the decision made.

Although His Honour did not go so far as to say that the existence of the EBA provisions completely overrode the Award provisions, it is clear from his findings that the Court was influenced by the differences that existed between the Award and the EBA provisions and the failure at first instance of the employees and the unions to raise this issue at all until the review.

As in the cases before me, it was argued that the failure to consult with the employees breached the Award provision requiring discussion. In response, at page 210 of his decision His Honour said:

“Counsel for the applicants accept that there were discussions between ASC and AFMEU. But they say these discussions did not satisfy cl 28 because they did not involve the employees themselves.
For the reason just stated, I agree that the discussions between ASC and AFMEU did not satisfy the requirements of c. 28. But the reason points up the problem of applying the clause to a situation such as that applying on 1 December. With which employees should it consult, in relation to the selection process? To hold a separate consultation with each employee would have taken a long time, unduly extending the anxiety of all employees and their families. And what purpose would they have been served? The question that would have concerned each individual employee was whether he or she would be selected for retrenchment. At that stage, the company could not have been answered that question. No doubt, Mr Bews could have called a mass meeting of employees; but this would not have been an effective consultation with them. It is difficult to see that it could have achieved more than the giving of information, the company conveying the same information as that already provided to the unions. I think cl 28 was drafted with a different situation in mind: the elimination of a relatively small number of specific jobs, their occupants being readily identifiable and able meaningfully to be consulted.”

Ultimately the Court found on the facts of those cases that the employer had “observed the spirit of the clause” referred to in the Award. In so finding His Honour was obviously influenced by not only the opportunity for and the extent of the discussions between the union and the employer but also the latitude the EBA allowed the employer in decision making. In the cases before me there is simply no evidence of discussions with the unions or the employees in the sense contemplated by clause 5.7.1 of the EBA. Moreover, if the employer is correct in its allegation that the unions declined to take up the issue of impending redundancies when it was raised at several EBA meetings between the unions and management it must then have been apparent to the employer’s management that it was in the best interests of the workforce to know and appreciate that redundancies of the magnitude contemplated by the employer were about to occur and to take steps to properly bring these matters to the attention of the workforce.

His Honour’s observations if they are to be applied to the cases before me, cannot be said to be authority for the proposition that the failure to consult with both the unions and the employees is acceptable and excusable where there are large scale redundancies. To so find would be to render clause 5.7.1 of the EBA and the similar provision found in many Awards nugatory.

On their facts the ASC cases are therefore distinguishable from the cases before me. Relying on the authority of the Sinclair and Mitchell-Collins cases it is apparent that there was an absence of consultation in the sense required by clause 5.7.1 of the EBA and because of this a lack of procedural fairness.

THE SELECTION CRITERIA AND S.170DE(2)

In considering matters of procedural fairness something needs to be said about the development and application of the selection criteria. By reference to the onus of proof provisions contained in sections 170EDA(1)(a) and (b) of the Act, it is commonly understood that an employee carries the burden of proof to show on the balance of probabilities that a termination; albeit one that is justified in the sense that a valid reason has been established by the employer, is harsh unjust or unreasonable. In the case of redundancies the employee must call evidence at least showing a prima facie case of some unfairness; for instance, in the consultative process or in the development and application of the selection criteria. However, realistically employees are not likely to be in a position where they are able to call evidence of matters specifically within the knowledge of the employer because the evidence comprises employment records or management witnesses linked to the employer and its processes.

Accordingly, notwithstanding the onus carried by the employee, it should always be kept in mind that the employer more often than not has power to adduce actual proof of matters it alleges it considered relevant to each employee’s performance and work history and to the fair application of the selection criteria. This is something quite apart from the actual development of the selection criteria and the need for an employer to concentrate on objective criteria in selecting employees for redundancy.

Matters relating to criteria such as unauthorised absenteeism and poor timekeeping are usually matters of record. In all the cases before me the employer stopped short of producing employee records and witnesses such as the superintendents and supervisor said to have been given the responsibility for completing the raw selection scores for each employee. This was done in circumstances where the employees each challenged either inconsistencies between the appraisal forms and their raw scores or the accuracy of the employer’s argument that some defect existed in their conduct or performance and that it was procedurally fair for the employer to rely on this to give the comparatively low scores achieved in some or all categories of selection criteria.

All of the applicants tendered in evidence their appraisal forms, completed by supervisors (who were not necessarily the same people in each case responsible for the raw selection scores); their score sheets being produced by the employer (see Exhibits R7 and R16), simply setting out against the named criteria the numerical basis for each applicant being selected for redundancy.

It is open to me and I do draw an adverse inference from the employer’s unexplained failure to produce relevant records and call its management witnesses to tell the Court what precise matters were taken into account by them where they were responsible for the actual score given in each category of the selection criteria (see Jones v Dunkel (1959) 101 CLR 298).

In the cases before me the employer called senior management, all of whom were at pains to reassure the Court that the selection criteria was essentially based on objective considerations and that those who had applied it had been properly instructed. They were, however, unable to give direct evidence of the fairness of the application of the selection criteria at first instance.

Seven categories with sub-headings were developed by the employer from mid March 1995 being criteria against which each employee at both sites were to be assessed. These headings were Quality, Quantity, Absenteeism, Attitude, Team Work, Skills and Safety (see Exhibit A1). I am satisfied on the employer’s evidence that the criteria as developed, whilst they inevitably allowed for some subjective assessment to be included, were directed to an objective assessment of the employee’s value to the employer as an employee with regard to both known performance and skills. The criteria were developed in consultation with the site managers and other more senior company management but certainly not following any discussion with the unions or the employees. Notwithstanding the lastmentioned omission, it was not contested that the site managers asked a number of relevant questions of management relating to the criteria and they were instructed generally to proceed to apply the criteria to each employee in consultation with the superintendents and the supervisors.

Thomson had only been employed for some four weeks at the Yallourn W Station before the redundancies occurred having been formerly employed by the SECV. His role in the application of the selection criteria was to instruct his three superintendents to undertake the exercise in consultation with the supervisors by dealing with each employee and scoring them out of ten for each selection criterion. The score sheets for the employees were not left with the supervisors but returned to Thomson who applied a weighting to the various criteria and ranked each employee in their particular work classification with a total score. His uncontested evidence, and this was the evidence of Brooke too, indicates that the site managers questioned the superintendents about the scores given and endeavoured to oversee the process in an effort to ensure that; for instance, any personality clashes between supervisors and employees were not reflected in the scores. In the final analysis it seems that the weightings at least at Yallourn W Station had no bearing on the outcome and, in order to identify the employees to be made redundant they were ranked on their numerical score and the group to be terminated in each skills classification was taken from the bottom of the rankings upwards according to the number of excess employees in that work classification.

By adopting the abovementioned method it was argued that all employees were treated equally and that included the shop stewards.

Of the nine employee applicants before the Court six were from the Yallourn W site and included the two shop stewards, Goss and Mitchell. The employer’s witnesses told the Court that in their deliberations both before finalising the selection criteria and after the rankings had been made there was some discussion about how to deal with any shop stewards who were affected by the process. It was agreed that the shop stewards would be treated in the same way as the employees and that, in assessing them against the criteria, the superintendents and the supervisors would be instructed to ignore the time spent by shop stewards on union activities. Given the many meetings and the time then being devoted to the EBA negotiations this was an important consideration at least in respect to the quantity of work criterion.

From 1993 Brooke had been a superintendent at the Loy Yang site and, on 1 February 1995, was promoted to the position of acting site manager. He approached his task in a slightly different fashion to Thomson, inasmuch as he instructed his two superintendents to undertake the rankings and to call upon the supervisors for any clarification if need be. There was no evidence to show whether the supervisors played any significant role or any role at all in the scores allocated to each employee at Loy Yang. He made this particular decision because of the history of poor relations between some supervisors and individual employees. It was his view, and this was a view generally contested by all the applicants, that the superintendents spent a lot of time on site and were in a position to assess the workers. The rankings (see Exhibit R16 for the three Loy Yang A employee ranking sheets) for the employees were returned by the superintendents to Brooke and were reviewed by him in their presence. Brooke then applied weightings and ranked the employees numerically in each of their classifications (see Exhibit R17).

The selection process was completed by late March or early April 1995 and the results tabled at a management meeting on the evening of 4 April 1995. Those results were the subject of some discussion on that evening before a decision was taken to notify the workforce and the unions on the following morning of the redundancies to take effect on 7 April 1995. At that meeting Smith determined on behalf of the employer that a Loy Yang shop steward, who Smith described as a leader of the men, should be removed from the group of employees to be made redundant even though his relative merit as an employee as against the selection criteria identified him for redundancy. In making what he called a “management call” Smith then placed an employee in the group to be made redundant who, but for the shop steward’s retention, would have kept his job on his relative merit.

As it turned out the shop steward upon finding out what had occurred took voluntary redundancy thereby making way for his affected colleague to be reinstated. Because of this action Smith’s unilateral decision ultimately had no direct affect on the fairness of the selection process; although the decision in itself highlights the difficult position of shop stewards in any selection process. For instance, it was said that union activities were not to be considered to the detriment of the shop steward employee in assessing the employee against the selection criteria. Likewise, the criteria contained no positive score for any of the attributes a shop steward may bring to the work site such as leadership and the representation of employee interests in the workplace. This may not be surprising in circumstances where the employer only wishes to maximise its productivity and does not see any discernible value in the employee’s direct union activities. Nevertheless, to subsequently attribute a value to the leadership attributes of a shop steward in his role as a shop steward, a value overriding his skills value to the employer, without giving proper consideration to the inconsistency this action produced when dealing with other shop steward employees caught in the redundancy net at least raises a question of fairness as between shop stewards in the selection process.

In the ASC cases the general manager, the manager of the hull shop, the senior foreman, the senior welding foreman and the enterprise relations manager all gave evidence to the Court. With the exception of the enterprise relations manager all the other witnesses were instrumental either in the preparation or application of the selection criteria to determine the identity of the employees to be made redundant. The evidence showed that the union was aware of the development of the selection criteria but did not seek to participate in the determination of that criteria and for that reason the Court was reluctant to find that the actions of the employer in developing the selection criteria were harsh, unjust or unreasonable. In contrast, in the cases at hand the employer did not call evidence from the superintendents or the supervisors where these people had been instructed to apply the selection criteria to each classification of employee. Neither did the employer invite the unions or the employees to enter into any discussions regarding the development and application of the selection criteria.

The site managers gave uncontested evidence about the instructions they passed onto the superintendents and the supervisors to enable them to carry out their unenviable task. The evidence is that the site managers perused and queried at least some of the results and then applied the weightings before supplying a final list to Smith who discussed the results with them. Given Smith’s concession in cross-examination that in mid March when the flow chart was shown to the union representatives there was a request by a union representative to have direct input in any process used to effect redundancies the failure to discuss these matters at least with the unions at that critical time was unreasonable.
SECTION 170DF(1) - THE SHOP STEWARD EMPLOYEES

Goss and Mitchell

S.170DF(1)(b) and (d) contain the following prohibitions:

“An employer must not terminate an employee’s employment for any one or more of the following reasons, or for reasons including any one or more of the following reasons:
(a)...
(b)union membership or participation in union activities outside
working hours or, with the employer’s consent, during working
hours;

(c)...
(d)seeking office as, or acting or having acted in the capacity of, a
representative of employees;

(e)...
(f)...
(g)...”

Subsections (2) and (3) are not relevant to these cases. However, s.170EDA(2) casts a positive burden of proof on the employer to show that the section has not been contravened by requiring that:

“S.170EDA(2) If an application under section 170EA alleges that a termination of employment of an employee contravened subsection 170DF(1) on the ground that the termination:

(a)was for a particular reason or reasons referred to in that subsection that were stated in the application; or
(b)was for reasons stated in the application that included a particular reason or reasons referred to in that subsection;
the termination is taken to have contravened subsection 170DF(1) unless the employer proves that:

(c)the employment was not terminated for the particular reason or reasons or for reasons that included the particular reason or reasons; or
(d)the particular reason was a reason, or the particular reasons were reasons, to which sub-section 170DF(2) or (3) applied.”

In his decision in Johns v Gunns Limited (1995) 60 IR 258, Justice Northrop had occasion to consider an application alleging a breach of s.170DF(1)(a), leading His Honour to make the following pertinent observations at pages 267 et seq on the application of both sections 170DF(1) and 170EDA(2):

“The reasons of an employer for terminating the employment of an employee are solely within the knowledge of the employer. The employer may state a reason but that reason need not be the actual reason nor need it be the only reason. Parliament has, from time to time, devised procedures to transfer to an employer the onus of proving the reason for termination of employment. Thus s 5 of the Conciliation and Arbitration Act 1904 (Cth) made it a criminal offence for an employer to dismiss an employee by reason of specified circumstances. Section 5(4) provided that in proceedings for an offence, if all the relevant facts and circumstances, other than the reason “set out in the charge as being the reason ... of the ... (dismissal) ... are proved, it lies upon the person charged to prove that ... (the dismissal) ... was not activated by that reason ...”.
In Heidt v Chrysler Australia Ltd (1976) 26 FLR 257, those provisions and earlier authorities relating to them were discussed at length and in particular at 266-271. I set out a passage appearing at 268 which has equal application to cases were s 170DF(1)(a) of the Act applies:

“The provisions of s 5(4) of the Act cast an onus of disproving facts, namely, that the reason for the defendant’s action was not actuated by the reason alleged in the charge. It has been held that a defendant need not prove the reason why he dismissed an employee: Atkins v Kirkstall-Repco Pty Ltd (1957) 3 FLR 439. The mere proof of a reason for dismissal, other than the reason alleged in the charge, does not necessarily negate the reason alleged in the charge. A mere denial of the reason alleged in the charge may not be sufficient to satisfy the onus cast upon the defendant. All the facts and circumstances leading up to the dismissal must be considered, including any reason expressed at the time of the dismissal, as well as any denial of the reason alleged in the charge.”

In the same lengthy passage, at 267 reference is made to averment provisions and what was said by Dixon J in R v Hush; Ex parte Devanny (1932) 48 CLR 487. These views could have equal force in the application of s 170DE(1) and s 170DF(1) of the Act.
The section now corresponding to s 5 of the Conciliation and Arbitration Act is s 334 of the Act. The wording is somewhat different but, for relevant purposes, the effect is the same, see Lawrence v Hobart Coaches Pty Ltd (1994) 1 IRCR 92; 57 IR 218.
Section 170EDA was inserted into the Act and came into operation on 30 June 1994. ... Section 170EDA applies with respect to terminations where the employee alleges there are no valid reasons for the termination under s 170DE(1) as well as to reasons, not necessarily the only reason, prohibited under s 170DF(1).”

His Honour went on to say at p.268 et seq:

“Under s 170EDA(2), where that section is to be applied, the termination is taken to have contravened s 170DF(1) unless the employer proves:
“(c) The employment was not terminated for the particular reason or reasons that included the particular reason or reasons; or ...”

It is because of this provision that the passage quoted from Heidt is of such importance. On the facts of this case, on the assumption that s 170EDA(2) applies, it would not be sufficient for the respondent to establish the reasons for dismissal as set out in the affidavit of the respondent and that they constituted valid reasons for termination under s 170DE(1). The respondent has to establish a negative namely that the reasons for dismissal did not include the reason that Mr Johns was temporarily absent from work because of injury. A mere denial may not be sufficient. All the facts and circumstances of the case have to be considered.”

The onus of proof to be satisfied is the civil onus; namely, on the balance of probabilities.

Goss was employed by the employer as a boilermaker from approximately October 1993 to 7 April 1995 having spent 11 years with the SECV beforehand and some 30 years in total in the power industry. Both in his employment with the SECV and the employer on several occasions Goss held temporary positions as a supervisor and was the AMWU shop steward. For personal reasons he stood down from the position as shop steward with the employer approximately a fortnight prior to the redundancies, although until then he was actively engaged in the EBA negotiations in his position as shop steward. During February 1995 Goss took two weeks’ leave and on his return it is not contested that he was asked by the company to perform Bill Taylor’s job as supervisor and the safety superintendent’s job whilst both these men were absent on holidays.

On 7 March 1995 Goss and Mitchell along with the other employee applicants received from the employer the confidential appraisal forms I have already referred to. In the cases of Goss and Mitchell these forms were apparently completed by their supervisor, Bill Taylor, during February 1995 or in the first week of March 1995.

The appraisal form contemplates employee responses on receipt of the form as well as an interview with management. From the evidence it emerged that the employees either because of union opposition to the appraisal process embarked upon without consultation with the unions or because the applicants had not gotten around to it, did not return the forms with their comments noted in response to the supervisor’s written appraisal in six areas of performance at any time before the date of terminate. Nor was the return of these documents actively pursued by the employer. In any event the non return of the appraisal forms is irrelevant to the present discussion. What is relevant is that in February and early March 1995 the employer was engaged in an attempt to appraise its workforce and this appraisal was still underway at about the time the employer instructed the two site managers to assess the employer’s workforce needs.

The appraisal took place, as to the employer’s part of the exercise, with the employees’ supervisors only a few weeks prior to the development of the selection criteria by management for selecting employees for redundancy, assessing each employee’s performance in nominated areas. At the time that the selection criteria was applied the appraisals already completed by the supervisors at least by early March 1995 were allegedly not considered by the employer as a basis for selecting employees for redundancy; nor were the inconsistencies between the written appraisal forms and the score sheets compiled some weeks later considered in determining whether the selection criteria had been applied fairly in each case.

The employer relied on the general differences between the criteria used in the two processes in attempting to overcome the suggestion that in some cases there were blatant contradictions between the appraisal forms’ laudatory comments and the scores given to some of the employees a few weeks later. It would be fair to say that the selection criteria were more comprehensive and took into consideration a number of sub-categories in each category. It was the employer’s evidence that the selection criteria was developed by considering the attributes the employer looked for in a prospective employee. In other words the employer sought to maximise the value of the workforce remaining after redundancies had taken place.

The appraisal form’s six categories of assessment were Quality of Work, Occupational Health & Safety, Quantity of Work, Time-keeping, Setting Priorities and Interpersonal Communications. Whilst these categories were not as extensively detailed as those developed for the selection criteria it is clear from the employer’s evidence (and Exhibit A1) that the categories of assessment regarded as important to the employer in the development of the appraisal form were generally covered by the interpretation it placed on the broad selection criteria. For instance, quality, quantity and occupational health and safety are obviously directly covered in the selection criteria categories of quality, quantity and safety. Time-keeping is a sub-category of the selection criteria referred to as “absenteeism”. Interpersonal and communication skills would also be relevant to the categories of “attitude” and “team work” and setting priorities may also be considered relevant to some of the matters the respondent believed worthy of consideration under the heading “Attitude”.

In Goss’ case in March 1995 he was scored against the selection criteria in the following way; achieving a score of 39 out of a possible score of 70:

SCORE

Quality ACCEPTABLE        5

Quantity N. IMP.                 3

Absenteeism V.G.  8

Attitude N. IMP.                 3

Teamwork ACCEPTABLE        5

Skills GOOD                  7

Safety V GOOD               8

TOTAL:               39

In contrast some weeks earlier his supervisor, in completing the appraisal form category “Quantity of Work”, said:

“Gives 100% effort when on job but because of his union involvement, quantity of work suffers through no fault of his own.”

The supervisor then gave Goss a general rating of “good performance” which rating is defined in the appraisal form as “Performance consistently meets expectations and job requirements.”

In the category of “Interpersonal and Communication” Goss was given an exceptional performance rating with the comments that, “Laurie is an excellent communicator and show (sic) good leadership qualities.”

The exceptional performance rating was the highest category of performance in the appraisal form and was defined as “Performance rating reserved for individuals whose results were exceptional and who continually utilise their abilities in an efficient manner relative to their job requirements.”

In the “Occupational Health & Safety” category Goss was rated as “Exceeds requirements” which rating was defined as “Performance continually exceeds expectation and job requirement.” Otherwise Goss received “good performance” ratings in each of the remaining appraisal categories.

Challenged on what appeared to be contradicting assessments, the employer provided no plausible explanation where there was some if not actual parity between the criteria applied some weeks apart. It is apparent from the competency rating sheet for Yallourn W prepared by Thomson (see Exhibit R8) that of the 25 boilermakers assessed Goss was the only boilermaker to receive a 3 score for quantity of work and one of only two boilermakers to receive a 3 score for attitude. He ranked 23rd in the group of 25 boilermakers at the Yallourn W site, where only 8 employees of the 126 employed scored 3 or less for “attitude” and only 6 scored 3 or less for “quantity of work”.

It was said by the employer’s witnesses, and I accept this evidence, that because such a large part of the workforce was to be retrenched it was inevitable that in the selection process good employees would be lost to the employer. This alone, however, does not explain the obvious inconsistencies in the performance assessments and apart from the s.170DF(1) considerations it puts into question the fairness of the application of the selection criteria to this individual employee.

Goss did query the discrepancy. He alleged that he approached Kim Hayes, a superintendent who was involved in the selection process, and was informed that his attitude had changed since his return from holidays in February 1995. This information was given without any explanation as to what was meant by the comment. Hayes was not called to give evidence. In the period shortly prior to his termination it is contended by Goss that he was heavily involved in the EBA negotiations and arguments with management concerning shift work allowances.

Because of the industrial activity consequent on the sudden redundancies conciliation produced an agreement from the employer to amongst other things review the redundancy of any individuals who notified the employer of their wish to have the decision reviewed and such review was to take place on 18 April 1995 (see Exhibit R6).

Goss was one of the individuals who sought review of the decision to retrench him and on the occasion provided the employer alleges that through its representative Thomson it sought to explain the application of the selection criteria. Goss denies that any meaningful explanation was given for the discrepancies between the appraisal form and the selection criteria score allocated to him particularly in the area of his attitude and the quantity of his work. I conclude from the failure to provide any plausible explanation at hearing that none was given at the review. The superintendents and the supervisors who completed his score and the appraisal form were not called to give evidence.

Mitchell is a fitter and turner who has been employed in the power industry for some 28 years, eighteen months of which was spent with the employer until he was made redundant on 7 April 1995. 18 years of his working life was spent at the Yallourn W Power Station and 20 years as a shop steward with the MWU. In the lastmentioned period he also served on the district committee administering union activities for the region and was branch president for one year.

It was not contested that Mitchell devoted considerable time and energy to union activities and the members’ interests on site.

The appraisal form received by Mitchell provided a uniformly good assessment of his performance and, in particular, in the category referring to the quantity of work produced the supervisor commented, “Quantity suffers due to union activities but 100% effort when on job cannot be faulted.”
Notwithstanding the abovementioned comment Mitchell received a “good performance” rating for this category as well as for all the other categories apart from occupational health and safety category where he was rated as “exceeding requirements”. In assessing the quality of Mitchell’s work the supervisor noted that “Harold produces work of a standard above the normal by using his wealth of job knowledge.”

The application of the selection criteria some weeks after the performance appraisal provided a score of 43 out of a possible 70 with the following break up of that score:

SCORE

Quality V.G.  8

Quantity N. IMP.                 3

Absenteeism V.G.                      8

Attitude POOR                  1

Teamwork GOOD                 7

Skills V.G.  8

Safety V G.  8

TOTAL:               43

What stands out in the score sheet is the 3 score for quantity of work and the 1 score for attitude.

There was no evidence given by any witnesses called by the employer providing any explanation for how these low scores were arrived at and what factors relevant to Mitchell’s performance were considered in achieving those scores. Of the 25 fitters who were assessed at the Yallourn W Station Mitchell was ranked 24th. Out of a total of 126 employees at the Yallourn W site represented on the competency rating sheet for Yallourn W compiled by Thomson (see Exhibit R8) Mitchell together with a cleaner had the unflattering distinction of scoring 1 for attitude and was one of the six employees (who included Goss) to score 3 or less for quantity of work.
It is alleged by Mitchell and this allegation is supported by Goss who told the Court he was present when Thomson either on the Thursday or Friday after notification of the redundancies informed Mitchell that his union activities had affected his results. In cross-examination Thomson said “I can honestly say I cannot recall ever saying anything along those lines”. It was also alleged that at a meeting with Smith, Goss being present with Mitchell, they were told that Mitchell’s poor score was due to him not working shiftwork or overtime. At that time the question of shiftwork was the subject of negotiation and dispute under the EBA.

Allegations of statements made by Thomson and Smith at meetings shortly after the notification of the redundancies were not properly put to these witnesses and as a consequence they were recalled. Smith claimed that with regard to both Goss and Mitchell he explained their scores and told them that their union activities were not taken into account, making these statements to them in response to their allegations that they had been singled out because of their union activities. Both in evidence-in-chief and further cross-examination Smith told the Court that during that meeting he told them that “... if they put as much into making their job work as they did in disrupting their job then they probably wouldn’t be in the shape/state that they were in.” He explained his comments further by saying that “... whenever they were to do their work they didn’t address their work with the vigour that they addressed other things. They just did not put forward their effort in doing their work out there.” In further cross-examination he reiterated that he “... said if they had put as much work in to making the job work as it was in disrupting the job that they were doing, then they wouldn’t be in the shape they were in.” In Thomson’s case he claimed that he had as site manager compared employees’ scores and Goss and Mitchell did not apply themselves to their work with the same diligence as they applied themselves to their union activities.

In both cases the employer has failed to discharge the positive burden of proof it carries to show on the balance of probabilities that in terminating Goss and Mitchell it was not actuated by the circumstance that Goss had until recently been a shop steward and Mitchell was a shop steward and that their respective performances had suffered because of their authorised union activities. It is not sufficient to simply assert that the people left to compile the scores were instructed not to take into account their union activities.

In Mitchell’s case whether or not Thomson uttered the words he is alleged to have uttered on or about 7 April 1995 matters very little. The employer provided no explanation for the poor scores received by Mitchell in relation to both the quantity of his performance as a fitter and turner and his attitude; nor did it call evidence to explain the discrepancy between the appraisal form and the selection criteria.

Bearing in mind the contents of the appraisal forms the only proper inference to be drawn is that the union activity of Goss and Mitchell was at least one of the reasons they faired so badly in the scoring process and in the eyes of management.

Accordingly, in Goss’ case and Mitchell’s case I find that there was contravention of s.170DF(1) of the Act and they are entitled to a remedy irrespective of findings I make concerning any other contravention of the Act by the employer.

At the date of hearing Mitchell was employed at ABB at Dandenong as a fitter and turner over a period of some three months. He alleges that he was then being paid at a rate of $13 or $14 per hour. He is 45 years of age. On termination he received a net sum of $7,030.36 which included the four weeks’ redundancy pay and two weeks’ notice paid to all retrenchees. An additional sum of $927.16 gross was paid to Mitchell and the other employees for an extra seven days allowed as a result of an agreement reached at conciliation following the termination. His gross taxable income to 30 June 1995 during his employment with the respondent was $26,932.68. He has not been employed in casual employment with the respondent since termination.

Goss is a 49 year old boilermaker who since 11 September 1995 has worked as a demolition worker earning $15.50 per hour rather than $17.00 per hour. He describes his current employment as casual, his employer having a two year contract at the site he is presently working on. Following the termination of his employment Goss spent some weeks between 29 May and 19 June 1995 with the respondent as a casual earning $3963.88 gross and some weeks with another employer constructing sheds. Goss’ gross taxable income received from the respondent in the financial year ending 30 June 1995 was $27,857.59; presumably including the sums paid to him as a casual employee. This is exclusive of any net termination pay received and totalling $5,907.57 ($7,327.51 gross). The further sum of $927.16 gross, was also paid to Goss. At 49 years of age Goss is a tradesman employed as a trade assistant and is not using his trade skills. This is a significant matter for a man of his age.

The Act’s remedy provision, S.170EE, was amended and enlarged from 15 January 1996 in the following manner applying as it does to judgments handed down after that date:

S.170EE(1) In respect of a contravention of a provision of this Division (other than section 170DB) constituted by the termination of the employment of an employee, the Court may if the Court thinks it appropriate in all the circumstances of the case make the following orders:
(a)an order requiring the employer to reinstate the employee by:

(i)reappointing the employee to the position in which the
employee was employed immediately before the
termination; or

(ii)appointing the employee to another position on terms and
conditions no less favourable than those on which the
employee was employed immediately before the
termination; and

(b)if the Court makes an order under paragraph (a):

(i)any order that it thinks necessary to maintain the
continuity of the employee’s employment; and

(ii)an order requiring the employer to pay to the employee
the remuneration lost by the employee because of the
termination.

S.170EE(2) If the Court thinks, in respect of a contravention of a provision of this Division (other than section 170DB or 170DD) constituted by the termination of employment of an employee that the reinstatement of the employee is impracticable, the Court may if the Court considers it appropriate in all the circumstances of the case make an order requiring the employer to pay to the employee compensation of such amount as the Court thinks appropriate.”

The evidentiary burden of proof of impracticability rests upon the employer. It is not enough for the employer to simply rely on the finding that redundancies were brought about by its operational requirements. To meet the requirements of the Act it need to refer the Court to circumstances that make it more likely than not that reinstatement is impracticable. In Sinclair’s case His Honour Justice von Doussa rejected the argument that the abolition of the applicant’s position because of redundancy was enough to show that reinstatement was impracticable. Sinclair was reinstated to another position on terms and conditions no less favourable than those on which he was employed immediately before his termination.

Similar considerations apply to Mitchell as do apply to Goss on the question of reinstatement. Reinstatement was not pursued by any of the applicants because of the belief that if they obtained their jobs back others would need to be terminated in their stead. Both Mitchell and Goss have spent a substantial part of their working life as tradesmen in the power industry suffering the disruption of compulsory redundancies in 1993.

The respondent is a large employer operating at least three sites (including the Jerralang site). It regularly recruits large numbers of casual workforce (up to 500 men during outages) including fitters and turners and boilermakers.

Taking into account all the circumstances there being no substantive evidence adduced by the employer to persuade me that it is impracticable to do so I have formed the view that the appropriate remedy is reinstatement in accordance with s.170EE(1)(a)(ii) of the Act with appropriate consequential orders pursuant to s.170EE(1)(b) of the Act.

THE REMAINDER OF THE APPLICANTS

There were seven remaining applicants who did not advance their claims on the basis that a reason for the termination of employment was either of the reasons prohibited by s.170DF(1)(b) or (d). As will be seen from the comments in the appraisal forms more often than not where the appraisal form identified some defect in performance the score sheets reflected this in lower scores without the employee being able to challenge the accuracy of a current allegation regarding their conduct or performance. I deal with each of the other applicants’ claims as follows:

(a) John Thomas Metcalf (Metcalf)

Metcalf is a 43 year old fitter and turner employed at the Loy Yang site for some eighteen months before his termination. Prior to that employment he had three years with the SECV and was a shop steward for the union the MWU; as well as being part of the team which negotiated the original EBA in 1993. He was not a shop steward at the time of the hearing and it was not alleged that his union activities at an earlier time played any part in his termination.

Metcalf received an appraisal form completed by a supervisor named Manny Borg (see Exhibit A3). It was Metcalf’s uncontested evidence that Borg was a temporary supervisor for some four weeks. In five of the categories contained in the appraisal form Metcalf was rated as putting in a good performance. However in the category of time-keeping he was rated as inadequate with the comment that “John’s attitude to time keeping is generally good although his on and off the job time keeping leaves a lot to be desired.” There was no explanation advanced for this comment at hearing.

Exhibit R16 contains Metcalf’s score sheet following the application of the selection criteria. It was put to Metcalf in cross-examination that the superintendent, Terry Miller, prepared Metcalf’s score sheet rather than a supervisor. This of course is consistent with the evidence given by Brooke. The score sheet included the weighting applied by Brooke and is set out as follows:

WEIGHTINGS SCORE

Quality 8 6

Quantity 7 5

Absenteeism 10 4

Attitude 9 6

Teamwork 8 7

Skills 10 7

Safety 10 7

TOTAL: 42

+ W = 53.28

Concentrating only on the raw scores in the right hand column for the moment, it is apparent that Metcalf received low scores for at least the categories of “quantity of work” and “absenteeism”. His scores otherwise being comparatively low. It was alleged by Metcalf that on Thursday, 6 April 1995 he confronted Smith seeking an explanation of the scores given to him and was informed by Smith that “absenteeism cost you your job Johnnie.”

Smith denied making the abovementioned statement yet conceded that it was his belief that Metcalf had more absenteeism than most other employees. In his discussions with Metcalf he recalled a reference by Metcalf to using some of his sick leave to visit his sick mother. There was some debate before me as to whether or not Metcalf should have and did properly seek and obtain compassionate leave in the circumstances alleged. I note that, if nothing else, Smith’s evidence does make it more likely than not that the question of absenteeism and the accuracy of the allegation concerning Metcalf’s conduct was certainly the subject of some discussion between he and Metcalf during the course of their meeting on 6 April 1995.

Absenteeism, which at selection included timekeeping and also dealt with unauthorised leave, is a matter capable of being objectively assessed by reference to employee records. It was contended by Metcalf at hearing that any sick leave taken or other leave was authorised leave in the sense that he either had medical certificates or a superior had verbally authorised the absences; including a five day absence in late 1994 during which period his mother was ill and died. It was Metcalf’s uncontested allegation that he was not given the opportunity before or indeed since termination to challenge the accuracy of these particular allegations.

Exhibit A4 contains two written references, the first dated 7 April 1995 is from Metcalf’s maintenance superintendent, Terry Miller, and the second is from his supervisor, David Bloomfield, whom Metcalf noted was one of many supervisors during his eighteen months of employment. Allowing for any desire to assist a retrenched employee, both references praised Metcalf as an individual and as an employee. References were not offered to the employees made redundant. It was open to the employer to provide no reference or a simple statement of Metcalf’s service with the company. This is not to say that employers should be deterred from assisting retrenched employees by the provision of full references. However, if it is the case that Terry Miller was the superintendent who applied the selection criteria to Metcalf he was not called by the employer to give evidence to explain the marked difference between the glowing reference given by him and the score.

Since termination Metcalf has been employed by the respondent as a casual between October 1995 and 27 November 1995 earning $6,666.48 gross. At hearing in December 1995 he told the Court that he was still employed as a casual by the respondent until the week before the hearing when he was told to finish up and reapply after the hearing. Prior to performing the casual employment for the respondent Metcalf alleges that he worked as a fitter in Queensland at the rate of $12.50 per hour compared with the $17.00 per hour he received from the respondent.

Metcalf’s termination pay was $5,681.14 net plus the extra week of $927.16 gross. To the end of the 1995 financial year Metcalf earned $28,053.99 gross from employment with the respondent.

(b) Graeme Giles (Giles)

Giles is a boilermaker/pressure welder who at the time of the hearing was unemployed. He is 42 years of age with some eighteen and a half years in the power industry, seventeen years of which were spent with the SECV. He was employed by the employer at the Yallourn W Power Station for the duration of his employment. After being made redundant in late April 1995 Giles was contacted by the respondent and returned to work as a casual employee from that time until just prior to the end of June 1995 and for a further period between October and late November 1995 earning $18,361.98 gross. During the period of the outage performed following the retrenchments Giles uncontested evidence was that he performed casual work of 60 to 70 hours per week for the respondent at a rate of pay exceeding his hourly rate as a permanent employee prior to termination. Giles has also worked for some weeks for Transfield and for one week as a pressure welder with Master Arc at APM. His termination pay consisted of a net figure of $6,005.92 with the additional gross payment of $927.16 for seven days. To the end of the financial year his gross income was said to be $29,286.42.

The selection criteria produced the following result for Giles (see Exhibit R7):

SCORE

Quality 8

Quantity 7

Absenteeism 7

Attitude 6

Teamwork 7

Skills 8

Safety 6

TOTAL: 49/70

Giles’ appraisal form (see Exhibit A6) was apparently completed by a supervisor named J. Bremner who Giles nominated as his direct supervisor. His performance was uniformly rated as being “good performance” in each category provided in the appraisal form. He generally agreed with comments made but explained that although he was sometimes reminded to wear his safety glasses there was an explanation for this and that was that on those occasions he was already wearing his welding helmet with its shield and presumably felt he did not need to wear the two together.

More importantly, he challenged the comment under time-keeping that he sometimes needed a reminder by telling the Court that he had “never had a late pass in my life”. He further challenged part of the statement under quality of work which said “quality of work is of high standard but at times seems reluctant to cross skill.” He alleged that about one month prior to the redundancies a superintendent, Brendan Smith, called him in to see him because he had refused a temporary supervisor’s instruction to do a fitter’s job he had not been trained to do. At that interview he queried the employer’s commitment to its promise of career paths for its employees (see clause 3.4 of the EBA - Exhibit R18). Notably the conciliation agreement on 11 April 1995 specifically provided for “Career Paths” as part of the agreement for the unions to lift all bans and limitations at the sites following the redundancies. Giles clearly felt that his outspokenness on these matters operated to his prejudice when the selection criteria was applied.

Giles also claimed that his weld rate was 100% successful and he rated himself in at least the top 5% of the boilermakers employed at the Yallourn W site. The competency rating sheet (Exhibit R8) prepared by Thomson against the score sheets completed by individuals who did not give evidence ranks Giles 21st out of 25 employees classified as boilermakers. This certainly does not place him in the top 5% or even the top 50% of this group, the last 8 of whom were made redundant.

(c) Joe Anthony Visalli (Visalli)

Visalli is a 29 year old boilermaker and pressure welder who was also employed at the Yallourn W site for some eighteen months before being made redundant. Prior to that he had some nine and a half years with the SECV and at the date of hearing had worked for three weeks at Bay Fab Engineering in Dandenong at the rate of $460 gross per week. He has not performed any casual work for the respondent since termination. At termination he received $6,074.50 net together with the additional payment of $927.16 gross. His gross earnings from employment with the respondent to 30 June 1995 were listed as being $26,190.96.

Visalli’s appraisal form (see Exhibit A9) was apparently completed by a supervisor named Paul Axisa who was one of several supervisors and acting supervisors supervising Visalli’s work over the period he worked with the employer. It was Visalli’s view that Axisa was very inexperienced as a supervisor and that as an electrician by trade Axisa was not really able to assess his work closely. In any event Visalli also took the view that the supervisors were rarely on the job with the gangs of men after they allocate work permits to the gangs in the mornings. Kim Hayes, his superintendent was, according to Visalli, never on the job with the gangs but only in his office and did not inspect Visalli’s work.

Visalli’s general rating in each category contained in the appraisal form was a “good performance” rating save for the quantity of work category where he received a rating of “inconsistent due to sick leave”. This rating is defined in the appraisal form as “performance does not consistently meet expectations and job requirements”.

The comment from the supervisor accompanying the appraisal was “works at a steady pace when available to work, however has had a lot of time off due to medical condition”.

The score received by Visalli following the application of the selection criteria was as follows (see Exhibit R7):

SCORE

Quality Good  7

Quantity Good.  7

Absenteeism Poor/needs improvem   3

Attitude Acceptable               5

Teamwork V Good  8

Skills Good  7

Safety Good  7

TOTAL:                 44

At some stage in early 1994 Visalli was treated for stress and alleges that “99%” of the time off was covered by medical certificates, the rest being verbally authorised unpaid leave. On his return on medication he alleges that the superintendent Kim Hayes queried the amount of leave and also arranged for him to be medically examined by a company doctor to determine his fitness for work. The doctor according to Visalli placed some height restrictions on his workplace activities and also made some recommendations about which the witness was unclear but which he understood to require him to have counselling or psychiatric treatment failing which there was a recommendation that his employment be terminated.

Where absenteeism and authorised leave are relevant considerations in determining the employee’s score, it was open to the employer to produce objective evidence of these matters and call the appropriate witnesses. It failed to do this and essentially Visallli’s explanation is uncontested. He was ranked 22nd in the group of 25 boilermakers assessed (see Exhibit R8).

(d) Richard Alfred Gauci (Gauci)

Gauci is a 31 year old fitter and turner who was employed at the Yallourn W site. Since being retrenched he has been regularly employed as a casual by the respondent from the end of May 1995 to the end of November earning some $18,297.06. His net termination pay was $5,496.57 plus $927.16 gross for the extra seven days’ pay. His gross earnings from his employment with the respondent to 30 June 1995 were said to be $28,226.69. I have assumed that that figure includes some of the casual monies paid to him since termination. He also performs casual work at a Morwell hotel which employment he commenced before the date of termination and has continued with until the date of hearing.

Gauci’s appraisal form (see Exhibit A10) was apparently completed by a supervisor known as Wayne Yeomans. Gauci received a good performance rating in all categories other than occupational health and safety where his rating was “exceptional performance”.

Gauci attended the review meeting conducted on 18 April 1995 to discuss his redundancy. This was the first occasion he had viewed the score sheet (see Exhibit R7) as follows:

SCORE

Quality 7

Quantity 8

Absenteeism 8

Attitude 7

Teamwork 6

Skills 6

Safety 7

TOTAL: 49/70

He queried the scores and particularly the score of 7 for safety as against the appraisal rating for occupational health and safety of “exceptional performance”.

Again the Court was left in the unsatisfactory position of the employer not calling any evidence which adequately explained the discrepancy complained of by the employee. Gauci was rated 21st in the group of 25 fitter and turners at Yallourn W (see Exhibit R8) and the 7 score for safety was the second lowest in that category, the lowest being 6, the score attributed to Mitchell.

(e) Peter John Robinson (Robinson)

Robinson is a 33 year old trades assistant who was employed at the Yallourn W site having spent some five and a half years before that with the SECV. As at the date of hearing he was employed at Wellington Linen Services in Sale. His net termination pay amounted to $5,811.82 with the extra seven days’ gross pay of $927.16. He was not re-employed following termination as a casual. He received gross income from the employer to 30 June 1995 amounting to $24,453.38.

Of all the applicants before the Court Robinson’s appraisal form assessment (see Exhibit A11) completed by Wayne Yeoman was the least complimentary, containing as it did the following ratings:

“Quality of Work - inadequate (that is performance fails to meet normal expectations and job requirements)

Occupational Health & Safety - inconsistent performance

Quantity of Work - inadequate

Timekeeping - good performance

Setting Priorities - inadequate

Interpersonal & Communication - good performance.”

Robinson challenged the abovementioned ratings other than the good performance ones claiming to have been “very stressed” after he received the document in early March 1995. His uncontested evidence was that allegations of defective performance were never previously raised with him before receipt of the appraisal form.

Robinson’s score sheet (see Exhibit R7) provided the following scores:

SCORE

Quality 5

Quantity 5

Absenteeism 6

Attitude 6

Teamwork 5

Skills 5

Safety 5

TOTAL: 37/70

Of the sixty employees in the classification MW 3 Robinson was rated last (see Exhibit R8). The employer did not produce any evidence, documentary or otherwise, to support the poor scores given in circumstances where any defects in performance were clearly challenged by the employee.

(f) Neville Parr (Parr)

Parr is 36 years of age and is a fitter and turner who was employed by the employer at its Loy Yang site. At hearing he told the Court that he had casual work as a crowd controller at AK Security once each fortnight at Lakes Entrance. He has also had some employment in Albury/Wodonga with an employer named Manpower. His estimate is that he has been employed some six to seven weeks in total since termination.

Prior to the termination Parr was an adult apprentice fitter and turner with the employer due to come out of his apprenticeship on 19 April 1995. Before his apprenticeship some four years earlier, Parr was employed as a rigger/scaffolder with the SECV. There was some confusion initially as to whether Parr had completed his apprenticeship before termination. However, I am satisfied that ultimately he accepted in his evidence that his apprenticeship was completed before termination. What was clear is that he had received his indentures. That evidence is consistent with the employer’s claim that by taking his holiday leave into account his apprenticeship was completed by the date of termination.

Since termination Parr has performed some scaffolding work with an employer named Tenakoe at the Hazelwood Power Station. He has also performed casual work for the respondent during October 1995 for which he received $4,380.77 gross. His termination pay was $5,681.14 net with $927.16 gross being paid for the additional seven days given to each employee. His gross earnings with the employer to 30 June 1995 were $27,492.82.

Parr’s appraisal form (see Exhibit A12) completed by a supervisor named G. Gaul provided the following assessment:

“Quality of Work - inconsistent performance

Occupational Health and Safety - good performance

Quantity of Work - good performance

Timekeeping - good performance

Setting Priorities - inadequate

Interpersonal and Communication - good performance.”

Parr challenged the assessments and, in particular, told the Court that he believed he had “... a slight personality clash with my supervisor”.

The score sheet (see Exhibit R16) rated Parr in the following way:

WEIGHTINGS SCORE

Quality 8 5

Quantity 7 4

Absenteeism 10 7

Attitude 9 6

Teamwork 8 6

Skills 10 6

Safety 10 8

TOTAL: 42

+ W = 54.28

Parr was the last applicant to give evidence before Smith and Thomson were recalled. He claimed that on 4 April 1995 he responded to a notice to all employees indicating that Smith would be on site that day to speak to employees about redundancies. The notice (see Exhibit R20) invited the employees to make an appointment to see Smith for this purpose. Parr took up the invitation and alleges that he was given the following assurance:

“... don’t worry Neville, you will be safe because we gave you the guarantee when we took over the contract from the SEC that we would take your indentures and we would make sure that you became a trades person ...”

Because of this abovementioned assurance Parr told the Court that he felt safe and confident in his job. Accepting for the moment that with annual leave taken into account Parr did and has qualified for his indentures prior to 7 April 1995, Smith, even when recalled did not allude to this matter or the question of the reassurance given to this man on the eve of the notification of termination of his employment. It was also alleged by Parr that on review of his scores on 18 April 1995 Smith took him through the scores, the suggestion being that he was led to believe that a score of 5 was average, 4 was below average and 6 and upwards was above average. One of Parr’s principal complaints was that quantity of work for an apprentice depended primarily on the tradesman he was assisting. Again there was no direct evidence called on by the employer on these relevant matters.

(g) Donato Ierardi (Ierardi)

Ierardi is 29 years old and was employed at the Loy Yang site as a fitter and turner for some eighteen months before being made redundant. Prior to that he had some nine years employment with the SECV. He was unemployed at the date of hearing having had one week’s casual employment with an employer he referred to as Simon Carves and some four weeks employment as a casual with the respondent from early October to early November 1995. The casual employment with the respondent grossed him $8,277.48. He received net termination pay of $7,394.16 plus the additional seven days gross pay of $927.16. His gross income to 30 June 1995 with the employer was identified as being $29,940.40.

Ierardi’s appraisal form (see Exhibit A8) was completed by the supervisor Ray Mosele with the following ratings:

“Quality of Work - inconsistent performance

Occupational Health and Safety - exceeds requirements

Quantity of Work - inconsistent performance

Timekeeping - exceeds requirements

Setting Priorities - good performance

Interpersonal and Communication - good performance”

Insofar as he had any view of the ratings in the appraisal he generally agreed with all of the ratings other than the two alleging an inconsistency in performance. As with the other employees he was not given the opportunity to be heard on these matters relating to poor performance.

The selection process produced the following score sheet (see Exhibit R16) compiled on scores allocated by a superintendent:

WEIGHTINGS SCORE

Quality 8 5

Quantity 7 4

Absenteeism 10 8

Attitude 9 6

Teamwork 8 5

Skills 10 6

Safety 10 7

TOTAL: 41

+ W = 53.14

Ierardi denied being aware of the opportunity to review his redundancy afforded by the employer on 18 April 1995 as a result of the agreement reached at conciliation and consequently he did not attend this review. In any event, he alleged that the first time he saw his score sheet was during the conciliation proceedings and this prompted him to ask Smith why his employment was terminated, the response being “... they just had to get down to a number ...”.

Ierardi as did the other applicants told of numerous changes of supervisors and superintendents during the currency of his employment with little contact between him and them on a day to day basis.

REMEDY FOR REMAINING APPLICANTS

Bearing in mind my earlier observations on matters of procedural fairness and the reasonableness of the employer’s actions, my finding is that there has been a contravention of s.170DE(2) of the Act. There is no basis for finding that the position of these seven employees may not have been different had there been consultation in the sense contemplated by the EBA (or with the unions alone) and an opportunity to challenge the accuracy of any current defects in conduct or performance relied on to select the employees for redundancy.

As I have already noted the employer employs a large permanent as well as a regular casual workforce at three sites. In at least two of the sites the work classifications of each of the applicants are well represented in the sense that the employer still employs a permanent workforce requiring the skills and qualifications of these men and performing the same duties performed by them before the terminations.

Accordingly, I propose to order that the respondent reinstate all the applicants by appointing them to another position on terms and conditions no less favourable than those on which each man was employed immediately before the termination of his employment.

All nine applicants gave general evidence concerning the receipt of wages during the period from the date of termination and the employer at my request tendered evidence of the amounts paid at termination as well as any amounts paid for casual employment with the company.

I propose further to make orders under s.170EE(b)(i) and (ii) relating to continuity of employment and the payment to each employee of remuneration lost because of the termination. In each case there was insufficient evidence before the Court to quantify precisely the appropriate deductions to be made for work performed in the relevant period and net amounts already paid by the employer to each employee. This being so each party to each proceeding is granted liberty to apply to the Court on reasonable notice to both the Court and the parties to the particular proceeding concerning both the calculation and the amount of any lost remuneration.

MINUTES OF ORDER

The Court declares that:

The termination of the employment of Laurence John Goss and Harold Stanley Mitchell by the respondent contravened s.170DF(1)(b) and (d) of the Industrial Relations Act 1988.

The termination of the employment of Laurence John Goss, Harold Stanley Mitchell, Joe Anthony Visalli, Graeme Leslie Giles, Donato Ierardi, John Thomas Metcalf, Peter James Robinson, Richard Alfred Gauci and Neville Parr contravened s.170DE(2) of the Industrial Relations Act 1988.

AND THE COURT ORDERS THAT:

The respondent reinstate each of the applicants Laurence John Goss, Harold Stanley Mitchell, Joe Anthony Visalli, Graeme Leslie Giles, Donato Ierardi, John Thomas Metcalf, Peter James Robinson, Richard Alfred Gauci and Neville Parr by appointing each applicant to another position on terms and conditions no less favourable than those on which each applicant was employed immediately before the termination.

For all purposes the respondent treat each applicant as having been continuously employed by it from the date of termination to the date of reinstatement.

The respondent pay to each applicant the remuneration lost by each applicant because of the termination.

There be liberty to any party to apply to the Court on reasonable notice being given to the Court and all other parties to a proceeding concerning the calculation and the amount of the remuneration lost under s.170EE(1)(b)(ii) of the Industrial Relations Act 1988.

NOTE: Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules.

I certify that this and the preceding fifty-nine (59) pages are a true copy of the reasons for judgment of Judicial Registrar Millane.

Associate:
Dated: 8 February 1996

Representative for the Applicants: Australian Manufacturing Workers’
Union (Victorian Office)
Representative for the Applicants: Mr Maurice Addison

Solicitors for the Respondent: Freehill Hollingdale & Page
Solicitor for the Respondent: Mr Jonathan Forbes

Date of hearing: 4, 5, 6, 7, 8 & 11 December 1995
Date of judgment: 8 February 1996

*SCORE*
Quality	ACCEPTABLE 5
Quantity	N. IMP. 3
Absenteeism	V.G. 8
Attitude	N. IMP. 3
Teamwork	ACCEPTABLE 5
Skills	GOOD 7
Safety	V GOOD 8
*TOTAL*: 39

*WEIGHTINGS*	*SCORE*
Quality	8	6
Quantity	7	5
Absenteeism	10	4
Attitude	9	6
Teamwork	8	7
Skills	10	7
Safety	10	7
*TOTAL: 42*

[1996] IRCA 27

8 Feb 1996