Litchfield v Chief Executive, Department of Manufacturing, Innovation, Trade, Resources and Energy

The appeal concerned the interpretation of an employment contract and the *Public Sector Management Act 1995* (SA) between the appellant, an executive employee, and the Chief Executive of the Department of Manufacturing, Innovation, Trade, Resources and Energy. The appellant's executive position was abolished due to budget decisions, and he was offered alternative positions. The central dispute revolved around whether the appellant was entitled to a termination payment under his contract, which stipulated conditions for such payments and excluded them in certain circumstances, including when an executive was appointed to another position in the public sector.

The court was required to determine the proper construction of clause 11.2 of the appellant's employment contract, which stated that an executive was not entitled to a termination payment if their appointment was terminated to enable them to be appointed to another position in the service of the State. The court also considered the interplay between this contractual provision and the provisions of the *Public Sector Management Act 1995* (SA), specifically sections 53 and 54, which deal with the reduction of remuneration levels and termination of employment, respectively, on grounds such as being excess to requirements.

The court reasoned that clause 11.2 of the contract was intended to prevent executives from claiming a termination payment when they voluntarily moved to another public sector position. However, in this case, the appellant's position was abolished, and the offer of a new position and the termination of his existing appointment were effectively simultaneous, effected by the same communication. Therefore, the termination was not "to enable the executive to be appointed to another position" in the sense contemplated by clause 11.2. The court found that the circumstances did not fall within the exclusion in clause 11.2, meaning the appellant's entitlement to a termination payment was not precluded by that provision.

The appeal was dismissed.