Margaret Anne Hogg v James Hardie Building Products Pty Limited (A.C.N. 065 850 508) Trading as James Hardie Bathroom Products
[1996] IRCA 51
•26 February 1996
DECISION NO: 51/96
CATCHWORDS
INDUSTRIAL LAW - TERMINATION OF EMPLOYMEMT - UNLAWFUL TERMINATION - REDUNDANCY - VALID REASON - REINSTATEMENT
INDUSTRIAL RELATIONS ACT, 1988 Sections 170 EA DB EE
MARGARET ANNE HOGG V. JAMES HARDIE BUILDING PRODUCTS PTY. LIMITED (A.C.N. 065 850 508) trading as James Hardie Bathroom Products
NO. NI 3003 OF 1995
CORAM: LINKENBAGH J.R.
PLACE: SYDNEY
DATE: 26 FEBRUARY 1996
IN THE INDUSTRIAL RELATIONS COURT
OF AUSTRALIA NO. 3003 OF 1995
NEW SOUTH WALES DISTRICT REGISTRY
MARGARET ANNE HOGG
Applicant
JAMES HARDIE BUILDING PRODUCTS PTY. LIMITED
(A.C.N. 065 850 508)
trading as JAMES HARDIE BATHROOM PRODUCTS
Respondent
JUDICIAL REGISTRAR: LINKENBAGH J.R.
PLACE: SYDNEY
DATE:26 FEBRUARY 1996
ORDERS
That the respondent reinstate the applicant by appointing her to a position on terms and conditions no less favourable than those on which she was employed on 8 February, 1995.
That the applicant is not entitled to payment of any sum by way of salary for the period
8 February, 1995 to 26 February, 1996 in addition to monies received by her to date.
That subject to order 2 the employment of the applicant by the respondent be deemed for all purposes to have been continuous since 13 March 1989.
Note: Settlement and entry of Orders is dealt with in Order 36 of the Industrial Relations Court Rules
IN THE INDUSTRIAL RELATIONS COURT
OF AUSTRALIA NO. 3003 OF 1995
NEW SOUTH WALES DISTRICT REGISTRY
MARGARET ANNE HOGG
Applicant
JAMES HARDIE BUILDING PRODUCTS PTY. LIMITED
(A.C.N. 065 850 508)
trading as JAMES HARDIE BATHROOM PRODUCTS
Respondent
JUDICIAL REGISTRAR: LINKENBAGH J.R.
PLACE: SYDNEY
DATE:26 FEBRUARY 1996
REASONS FOR JUDGMENT
This is an Application pursuant to Section 170 EA of the Industrial Relations Act, 1988 in which the applicant seeks a remedy in respect of the termination of her employment by the respondent. The employment commenced on 13 March 1989 and terminated on 8 February 1995. Initially the applicant was a Secretary, but from January of 1990 she performed duties as a Personnel Officer, mainly processing time sheets and dealing with pay enquires and other matters relating to the employees at the factory. There were about 200 employees.
The respondent took no issue at the hearing with the quality of the conduct or work performance of the applicant. Its case was that her employment was terminated because her position became redundant as a result of restructuring of the organisation.
There was little dispute in the evidence of the parties as to the events of the termination on 8 February 1995. The first the applicant knew of it was that she was visited in her office on 8 February by two managers and was told:
“Margaret, we are restructuring, your position is redundant and your services are no longer required”
The applicant responded: “You’ve got to be bloody joking”.
There was other brief conversation and the applicant was handed a typewritten letter and she left the workplace. She was given a cheque for an amount which equalled twenty six weeks pay.
In the same week, the applicant was diagnosed with a serious medical condition and she underwent major surgery shortly thereafter. She was incapacitated for some weeks, but had her employment continued, the period of incapacity for work would have been more than covered by her accrued sick leave entitlements. Her health problems were part of the reason for the delay in the making of this Application and consequentially in the listing of the Application for hearing. She did not lodge the Application within the time allowed by the Act, and was granted an extension of time by the Court on 25 September, 1995. Reasons for that decision are given in Judgment No. 705/95.
Since recovering her health the applicant has actively sought work and has obtained some casual work from which she earned about $3,700 gross income. She resides at Bowral and that reduces her options as to the availability of suitable work. Her salary from the job with the respondent was $30,930 per annum and she also had the benefit of Employer Superannuation contributions. The workplace was at Moss Vale.
The applicant was born on 21 December, 1936 and was 59 years of age at the time of termination. She told the Court that she intended to work until age 60 and at that time assess whether she would work beyond that age.
I find that the termination was at the initiative of the employer. The only reason for the termination argued before me was the respondent’s assertion that the applicant’s position became redundant because of a restructuring of the organisation. The evidence to support that assertion was given by Mr. David Finch. His evidence was that the decision was taken within a day or so before the 8th February, when the management decided that the role of Personnel Officer was no longer required, and that the duties of that position were to be split amongst other employees. One other employee was made redundant on the same day.
There is no evidence that anything at all was done to soften the blow for the applicant, apart from provision of the letter and what might be seen as a generous payment. The respondent did not consider compliance with the obligations created by Section 170 DB of the Act and the apparent generosity of the payment on termination is reduced to that extent. The letter given to the applicant offers to reimburse her for up to $200 for fees paid to a Financial Adviser and it provided the telephone number of a service in “Outplacement Counselling” at Wollongong. In the applicant’s circumstances such suggestions were of little assistance or comfort. I note that during the hearing she was subjected to some critical comment for her failure to initiate contact with either service, in the context of mitigation of her loss. Such criticism was short-sighted, to say the least, given my findings as to the respondent’s breaches of its obligations to the applicant.
The letter also asserts that there has been an “extensive review and restructure of our Water Heater Manufacturing Operation at Moss Vale” which caused the applicant’s position to become redundant. No evidence was adduced before me to support that assertion, and the truth of it was belied by the fact that about a month after the applicant was terminated the respondent employed a casual to do substantially the same job. The other staff amongst whom the applicant’s duties had been split were unable to perform them satisfactorily. Further, the casual was appointed to a permanent position from 1 July, 1995. No consideration was given to offering either the casual or the permanent job to the applicant. I find adversely as to the credit of Mr. Finch in that the evidence relating to the employment of the casual was not volunteered by him and was elicited only in cross-examination.
I find that there was no valid reason based on the operational requirements of the respondent’s business, for the termination of the applicant’s employment. It is not necessary for me to also make a finding that the termination was harsh, unjust or unreasonable, but such a finding would have been available on the facts. The conduct of the respondent falls short on all the tests for harshness, unjustness or unreasonableness which have been identifed, except perhaps for the amount of the termination payment, but it is to be remembered that many decisions of the Court support the view that an employer will not be permitted by the Court to buy its way out of breaches of the Act by means of generous termination payments.
The primary remedy available to the applicant in reinstatement and it is sought by the applicant. I find on the evidence before me that reinstatement is the best remedy and is not impracticable. The amendment to Section 170EE (1) by Act No. 168 of 1995 applies to these proceedings and has the effect of broadening the discretion which I have the power to exercise. The amendments reduce the relevance of prior authorities on the principles to be applied in considering reinstatement, and require each case to be considered on its own facts. There will always be cause for reservations about ordering reinstatement where a long period has passed since the date of termination. In this case the respondent has multiplied any inconvenience which reinstatement may cause it and its other employees by its own conduct in not considering the applicant for re-employment when it had the opportunity to do so. It put the casual on to do the work previously done by the applicant, and the applicant should not be disadvantaged because of the employment of that casual.
My discretion extends to the making of orders necessary to maintain the continuity of employment. I shall make a general order in those terms. I also have a discretion, if I consider it appropriate in all the circumstances of the case, to require the respondent to pay the applicant the remuneration lost because of the termination. I do not propose to exercise that discretion in favour of the applicant. My reasons are that the applicant has had the benefit of termination pay equal to 26.73 weeks pay, which I will not require her to repay, and her annual leave, sick leave and superannuation and other entitlements will be restored by the order for continuity of employment. She has also had other income for part of the time. Further, the delay in the hearing of the application was caused by the applicant’s delay of about five months in filing her application and that is a circumstance which is relevant. The respondent should not be penalised because of that delay, as it would be if it were required to pay wages and receive no services in return.
I was referred to authorities as to the calculation of compensation in lieu of reinstatement by the representatives of both parties. There is no need to consider those authorities, and the effect of the recent amendments to Section 170 EE (3) on the views previously expressed by the Court as to the appropriate methods of calculating compensation under that Section.
The Orders I make are:
That the respondent reinstate the applicant by appointing her to a position on terms and conditions no less favourable than those on which she was employed on 8 February, 1995.
That the applicant is not entitled to payment of any sum by way of salary for the period
8 February, 1995 to 26 February, 1996 in addition to monies received by her to date.
That subject to order 2 the employment of the applicant by the respondent be deemed for all purposes to have been continuous since 13 March 1989.
I certify that this and the preceding three (3) pages are a true copy of the Reasons for Judgment of Judicial Registrar Linkenbagh
Stephen Williams
Associate
Dated:
Solicitors for the applicant: Cutler Hughes and Harris
Counsel for the applicant: Mr Robert Reitano
Representative of the respondent: Mr Bryce Cross
Chamber of Manufacturers of NSW
Date of hearing: 31 January 1996
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