Mason Say Yadi v Plasmatronics Pty Ltd
[2015] FWC 2562
•17 APRIL 2015
| [2015] FWC 2562 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Mason Say Yadi
v
Plasmatronics Pty Ltd
(U2014/7988)
DEPUTY PRESIDENT GOOLEY | MELBOURNE, 17 APRIL 2015 |
Application for relief from unfair dismissal.
[1] Mr Mason Say Yadi was employed by Plasmatronics Pty Ltd from 1 March 2011 until his employment was terminated on 2 June 2014.
[2] Mr Say Yadi alleged that his dismissal was unfair. Plasmatronics objected to the application because it said Mr Say Yadi’s dismissal was a genuine redundancy.
The Evidence
[3] Ms Virginia Graham, the Business Manager for Plasmatronics, gave evidence that Plasmatronics designs and manufactures solar charge controllers. Mr Say Yadi was employed as a Customer Repairs Technician. It was not disputed that his work was covered by the Manufacturing and Associated Industries and Occupations Award 2010. 1
[4] Plasmatronics employed a Senior Technical Officer, a Production Repairs Technician, a Customer Repairs Technician and a Technical Customer Support Officer.
[5] It was her evidence that the major product sold by Plasmatronics was nearing the end of its lifespan and that its sales turnover has been reducing every year since 2009. 2
[6] Ms Graham gave evidence that due to reduced turnover and high static costs in January 2014, month to month losses were occurring. A report from Plasmatronics accountants supported this evidence. 3
[7] Discussions commenced amongst the management about the need to reduce staff costs but no decision was made because they were concerned that if a large order came in, in the second half of the year, they would not have sufficient staff. 4
[8] Ms Graham said that at weekly staff meetings, which all staff are required to attend, there were discussions about sales figures and potential orders. 5
[9] On 7 May 2014, Ms Graham told a staff meeting that the company would need to reduce staffing levels and advised that staff could volunteer for redundancy. One Production Staff member volunteered and that person finished up on 27 May 2014. Another Technical Customer Support employee also volunteered and that redundancy was finalised on 28 May 2014. 6
[10] On 29 May 2014, a letter was sent to all staff advising that two employees had taken redundancy voluntarily and that Plasmatronics expected another two to four positions to be made redundant. 7
[11] May was a particularly bad month financially and management decided that it would be necessary to remove one position from each of dispatch, engineering and technical support. 8 It was decided to meet with the selected employees on 2 June 2014.
[12] Ms Graham said that she was not present at the meeting held with Mr Say Yadi to discuss his termination but could hear Mr Brendan English ask Mr Say Yadi not to leave the meeting. She said that Mr Say Yadi walked up the stairs to Mr Alan Hutchinson’s workspace and when he left he came past her and said he had been made redundant and it was not acceptable. 9
[13] I explained to Mr Say Yadi that if he disagreed with Ms Graham’s statement he needed to put his version of events to Ms Graham otherwise I would accept her evidence. 10 Mr Say Yadi did not challenge Ms Graham’s evidence.11
[14] Mr Brendan English, Plasmatronics Technical Manager, gave evidence that he was part of the management team. His evidence about the downturn in the business was consistent with Ms Graham’s evidence. 12 It was his evidence that at the time they decided to make further positions redundant, there was a decision to reduce managers’ wages.
[15] It was his evidence that Mr Say Yadi was selected for redundancy because it was determined that the business could afford to lose this position. It was his evidence that there were no redeployment opportunities.
[16] Mr English met with Mr Say Yadi and his supervisor Mr Cameron Lewer to discuss the redundancy. It was his evidence that Mr Say Yadi refused to accept the letter which explained why his position was made redundant. Mr English said that Mr Say Yadi repeatedly said that he did not accept the redundancy and was very angry. It was his evidence that Mr Say Yadi stormed out the meeting. 13 The letter that had been prepared for Mr Say Yadi advised him that customer repairs would be reorganised in a way that does not require a technician to do component level diagnosis and repair as most faulty units would be replaced with new ones.14
[17] Mr Say Yadi was sent a letter on the same day terminating his employment. As well Mr Say Yadi was sent a letter which was a record of the meeting and copies of the letter he refused to take in the meeting and his pay advice. 15
[18] Mr English recorded that Mr Say Yadi objected to being made redundant when a new technician had been employed. Mr English said that it was explained to Mr Say Yadi that the other technician was employed some time ago to replace another employee and he was not doing the same job as Mr Say Yadi.
[19] Mr English said that after leaving the meeting Mr Say Yadi spoke to Mr Alan Hutchinson, the owner of the business, and then went to his desk. Mr English said he told Mr Say Yadi to stop deleting files from the computer and he refused and said to Mr English that he would need to call the police if he wanted to throw him out. Mr Lewer unplugged the computer and Mr English again offered Mr Say Yadi the letters which he refused to take. He then left and went to talk to Ms Graham. 16
[20] After he left the building, Mr Say Yadi sent an SMS to Mr Lewer saying he was unwell and would take a week off. Mr Say Yadi was advised that Plasmatronics would pay out his outstanding sick leave even though it was not required to do so. 17
[21] In cross examination, Mr English agreed that when Robert Scholton, who was in the same department as Mr Say Yadi, volunteered for redundancy that they only expected one person from each department would be made redundant but he denied making any promises to Mr Scholton. 18
[22] Mr English accepted that invoices were provided to a Chinese company at lower than cost. 19 Mr English denied that the Chinese company then paid Plasmatronics a higher amount.20
[23] Mr English agreed that invoices of low value were provided for repair work but no monies were in fact received for the work. 21 Mr English denied having under-declared sales.22
[24] Mr English gave evidence that employees on the shop floor would not know what money was received by the company. 23
[25] Mr English denied that Mr Gary Hamilton’s employment status had changed. 24 He referred to letter signed by Mr Hamilton which stated that he was employed on a casual part time basis since 16 December 2013 and that he was not employed on a full time basis.25
[26] In answer to my question, Mr English said that Mr Hamilton was employed on a casual basis. 26
[27] Mr English said that Mr Say Yadi was at two of the meetings at which the financial difficulties of the company were discussed. 27
[28] Mr Alan Hutchinson, the Managing Director, gave evidence about the financial position of the business. 28
[29] It was his evidence that the repair section did not cover its cost and it would be cheaper to replace faulty items rather than repair them. It was decided to restructure the repair section in this fashion. As a result Mr Say Yadi’s 29 position was abolished. As there were no vacancies Mr Say Yadi could not be redeployed.30
[30] Mr Say Yadi came to speak to him on 2 June 2014 after he met with Mr English and Mr Lewer and Mr Say Yadi said “you can’t fire me. It is not acceptable.” He asked Mr Hutchinson if he was happy with the situation and Mr Hutchinson said he was not but he had no choice due to the financial situation of the company.
[31] Mr Hutchinson said he told Ms Graham to pay Mr Say Yadi another four weeks pay in addition to his accrued sick leave in addition to his lawful entitlements.
[32] On the same day, Mr Say Yadi sent Mr Hutchinson a text message in which he complained that he had been made redundant when an employee with no dependants had not been dismissed. 31
[33] On 5 June 2014 Mr Say Yadi sent Mr Hutchinson an email in which he told Mr Hutchinson that he had been unfairly dismissed and had been the victim of racial discrimination.
[34] In that email he told Mr Hutchinson that after Rob in his department had volunteered for redundancy he had met with Mr Lewer and said to him that he was feeling guilty because Rob had said he resigned to save his job. Mr Lewer told Mr Say Yadi not to worry. A few hours later he asked Mr Lewer if his position was being considered for redundancy and he told him it had been considered but not anymore. 32
[35] He also told Mr Hutchinson that on 30 May 2014 Mr Say Yadi spoke to Mr Lewer about his income protection policy which he had not paid for the last few months. He said he had been contacted by the insurer who told him it would still be valid if he paid the arrears. He told Mr Lewer that it would be difficult for him to pay as he would need to borrow the money but he would do this if he was at risk of losing his job. He said that Mr Cameron said he had never had income protection insurance and “you don’t bother it, too.” From this Mr Say Yadi inferred that his job was safe. 33
[36] Mr Say Yadi said that Mr Lewer apologised at the meeting on 2 June 2014 about misleading him last week as he had not been updated about the news. Mr Say Yadi disputed Mr English’s notes of the meeting. 34
[37] Mr Hutchinson had Ms Graham prepare a response which he authorised. That letter invited Mr Say Yadi to provide specifics of any inaccuracies or omissions in the record of meeting. He was further invited to provide details of his complaints directed at Mr Brendan English. 35
[38] In cross examination Mr Hutchinson disputed Mr Say Yadi’s allegations that the downturn in the business was not real because the sales and repair figures were not accurate. He explained that most of the repair work done was covered by warranty and as a result there was no exchange of money. However a form of invoice is required and as a consequence a low value invoice is raised but it is never paid. 36 Mr Hutchinson denied there was any fraud involved and that the reason Mr Say Yadi was made redundant was because there was a downturn in the business.37
[39] In cross examination Mr Hutchinson explained that the situation that the company faced was changing quickly and while the information provided to employees that one position in Mr Say Yadi’s department was to be made redundant was correct at the time it was given there was a change of plans the next day. 38 It was his evidence that Mr Lewer was not part of those discussions and as a consequence they were not aware of the issue with Mr Say Yadi’s income protection insurance.39
[40] It was put to Mr Hutchinson that despite the claim that they were no longer doing repairs this was still occurring. Mr Hutchinson said that given the costs of repairing items he gave instructions that they were to move to a replacement model. Mr Hutchinson accepted that someone is still investigating the fault “so [they] get some idea of what’s going wrong.” 40
[41] Mr Say Yadi put to Mr Hutchinson that he used to do the investigation and the repairs and that is still being done. He put to Mr Hutchinson that Gary was doing this work. Mr Hutchinson denied that Gary was doing his job. He said that they had changed the way the repair system operates and Gary and/or Cameron are doing those assessments but are not doing the repairs. Gary he said was primarily doing production repairs. 41
[42] Mr Hutchinson gave evidence that as far as he could recall Mr Say Yadi was at the meetings where he discussed the downturn in the business and the need for redundancies. 42
[43] Mr Cameron Lewer gave evidence that he met with management in late May to discuss redundancies and it was decided to make Mr Say Yadi’s position redundant. He said that before the forced redundancies were announced another staff member decided to take the redundancy offer. He agrees that he spoke to Mr Say Yadi and accepted that that would have given Mr Say Yadi the impression that he would not need to worry about his position. He was latter informed by management that another staff member from his department would need to be made redundant. 43
[44] He agreed with Mr English’s record of the meeting with Mr Say Yadi on 2 June 2014. 44
[45] It was his evidence that customer repairs are now spread across four to five staff depending on who is available. He said that customer repairs at component level have largely been replaced by board level and unit level replacement which takes less time. He said that they are currently spending less than quarter of the time on customer repairs. He said his work had increased to cover Mr Say Yadi and Rob’s work. 45
[46] Mr Lewer gave evidence that Gary was employed approximately six months ago as a Production Repairs Technician and while he now helps out in customer repairs, that is not his main role. 46
[47] Mr Lewer sent Mr Say Yadi an email on 9 June 2014 stating he was sorry that he had been made redundant. 47
[48] Mr Lewer accepted that Mr Say Yadi had provided training to Gary about customer repairs but he said that was necessary because Mr Say Yadi was going to be absent from work. 48
[49] Mr Lewer denied that any promise had been made that no one else would be dismissed after Rob volunteered for redundancy. 49 Mr Lewer said the situation was fluid.50
[50] Mr Lewer said in cross examination that it had been decided to replace items instead of repairing them. 51
[51] Mr Say Yadi put to Mr Lewer that Mr Say Yadi spent 90% of his time assessing each unit that needed repairing. Mr Lewer accepted that he spent the majority of this time doing this work. 52 It was his evidence that he was now doing the majority of the assessments and that he had streamlined the process and a lot of units are being replaced.53
[52] It was put to Mr Lewer that in fact they were still repairing items. He gave evidence that he was involved in this on a daily basis and that a lot of products were being replaced. 54 Simple repairs are still being done but they are replacing rather than doing component level repairs.55
[53] Mr Lewer accepted that there are four staff doing repairs and that Gary did some repairs. 56
[54] Mr Lewer gave evidence that he was not involved in invoicing but accepted that they don’t charge the Chinese company for repairs. 57
[55] Mr Lewer gave evidence that he attended meetings at which the financial position of the company was discussed. He believed that Mr Say Yadi attended those meetings. 58 He said he attended all meetings but he couldn’t be 100% certain that Mr Say Yadi attended.59
[56] Mr Say Yadi put to Mr Lewer that he wasn’t at the last meeting. Mr Lewer could not recall if he was present. 60
[57] In re-examination, Mr Lewer gave evidence that if a product was returned that had a faulty board the retailer would not know if the board was replaced or repaired. 61
[58] Mr Say Yadi made a number of allegations about Ms Graham, Mr English and other employees which are not relevant to whether Mr Say Yadi’s dismissal was a genuine redundancy.
[59] Mr Say Yadi also made a number of allegations about the relationship between Plasmatronics and another company. Again, those matters are not relevant to whether Mr Say Yadi’s dismissal was a genuine redundancy.
[60] Mr Say Yadi challenged the sales figures because he submitted that they were based on false figures. 62 It is Mr Say Yadi’s evidence that the figures provided underestimate the true income of the company.
[61] Mr Say Yadi said that Gary had been employed on 20 December 20143on a part time, casual basis and he was given a permanent position as soon as Mr Say Yadi was dismissed. 63 In another statement Mr Say Yadi said that Gary was offered a full time position on 28 May 2014.64
[62] Mr Say Yadi gave evidence that Gary was doing his job under a different title. 65
[63] Mr Say Yadi disputed Mr English’s version of what happened at the meeting on 2 June 2014. He said that Mr Lewer apologised for misleading him. Mr English asked him to sit and he said he was OK. He said that Mr English then yelled at him and said “this is a direct instruction, sit down.” When he told Mr English that he was uncomfortable and he was going to leave the meeting he said that Mr English shouted at him “if you leave the room, I will fire you, sit down, this is a direct order.” Mr Say Yadi then left the room. 66
[64] Mr Say Yadi gave evidence of what he said was discriminatory conduct directed towards him at the workplace which he says was the real reason why his employment was terminated. 67
[65] In cross examination, Mr Say Yadi accepted that he did not know what percentage of the company’s income came from repairs. 68
The legislative context
[66] The Fair Work Act 2009 provides that a person has not been unfairly dismissed in cases of genuine redundancy.
S385 What is an unfair dismissal
A person has been unfairly dismissed if FWA is satisfied that:
(a) the person has been dismissed; and
(b) the dismissal was harsh, unjust or unreasonable; and
(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.
[67] A genuine redundancy is defined as follows:
S389 Meaning of genuine redundancy
(1) A person’s dismissal was a case of genuine redundancy if:
(a) the person’s employer no longer required the person’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise; and
(b) the employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.
(2) A person’s dismissal was not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within:
(a) the employer’s enterprise; or
(b) the enterprise of an associated entity of the employer.
Did Plasmatronics no longer require Mr Say Yadi’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise?
[68] I accept the evidence of Plasmatronic’s witnesses about the financial position of the company. The auditor has reported a significant reduction in turnover and profit. 69 I accept the evidence that as a result Plasmatronics made a decision that it needed to reduce its head count. I also accept that a decision was made that it was more cost effective to replace items rather than repair them.
[69] Mr Say Yadi put a number of serious allegations to Mr Hutchinson and Mr English about its invoicing practices. Both gave credible explanations as to why low price invoices were issued to the Chinese companies. There is no evidence before the Commission which would cause me to question the evidence about the company’s financial position.
[70] While I accept that a significant proportion of Mr Say Yadi’s position involved assessing the faults, I accept Mr Lewer’s evidence that this work is now being done by him and other employees. While I do not doubt that Mr Say Yadi was told by retailers that repairs were still being done I accept Mr Lewer’s explanation that a retailer would not know if the board was replaced or repaired.
[71] Plasmatronics decided to reduce its head count, change the way it performed customer repair work and redistribute the work between a smaller number of employees. As a consequence it decided that Mr Say Yadi’s position was to be made redundant.
[72] I accept that Mr Say Yadi believed that his position was safe once another employee volunteered for redundancy. It was unfortunate that having told employees that one person would go from the department that it was then decided that another had to be made redundant. However I accept the evidence of Mr Hutchinson and Mr English that the situation changed and the financial position of the company caused them to make a decision to reduce the head count further.
[73] It is also unfortunate that Mr Lewer discussed with Mr Say Yadi income protection but that discussion was not relevant to the decision of Plasmatronics to make Mr Say Yadi’s position redundant.
[74] I find that Mr Say Yadi’s position was no longer required because of the changes Plasmatronics operational requirements.
Did Plasmatronics meet its obligations under the agreement to consult with Mr Say Yadi?
[75] Mr Say Yadi’s employment was covered by the Manufacturing and Associated Industries and Occupations Award 2010 (the Award).
[76] That Award provides at clause 9 for consultation. I do not replicate the clause here as it is in the standard form.
[77] It is not disputed that in May 2014 all employees had access to a letter that advised that the company was facing a financial downturn. Staff were advised that up to six staff may be made redundant. 70
[78] Regular meetings were held with employees to keep them informed of the situation. I am unable to find that Mr Say Yadi was at all of the meetings but I find that Mr Say Yadi did know that it was possible that employees may made redundant and why.
[79] Mr Say Yadi gave evidence that on 23 January 2014 Mr Hutchinson told the employees that it would be a hard financial year. 71 There was no talk of redundancy at this time.
[80] It is clear that in May 2014 Mr Say Yadi knew that the financial position of the company was such that redundancy was being discussed. On Mr Say Yadi’s own evidence, he understood that Rob had volunteered to take a package to save his position. Mr Say Yadi said that he received a letter from Mr English about redundancy a day after he sent an email to Mr Lewer advising him that as his wife was absent and he was the sole carer for his daughter. 72 Mr Say Yadi’s email was sent on 15 May 2014.73 Also Mr Say Yadi’s conversation with Mr Lewer about his income protection insurance took place in the context of him being concerned about his job security.
[81] On 2 June 2014, after the decision had been taken to make Mr Say Yadi’s position redundant, Mr English and Mr Lewer met with Mr Say Yadi to advise him of the decision.
[82] There is no evidence that at this meeting or at any time before this meeting, Mr Say Yadi raised any issues about the proposed redundancies with his employer.
[83] There is a dispute between the witnesses about what happened at the meeting. Mr English provided a document in which he set out what happened at that meeting. Mr Lewer agreed with Mr English’s version of events. Mr Say Yadi had a different version of events.
[84] I do not accept that Mr English yelled at Mr Say Yadi to sit down. Nor do I accept that he told Mr Say Yadi that if he left the room he would fire him. A decision had already been made to make Mr Say Yadi’s position redundant. I accept that Mr Say Yadi left the meeting which prevented a detailed conversation about the decision.
[85] After the meeting Mr Say Yadi met with Mr Hutchinson and raised with him the financial difficulties the redundancy caused him. Mr Hutchinson said that he decided to pay Mr Say Yadi an additional four weeks pay plus his accrued sick leave in addition to his legal entitlements. 74
[86] Information was provided to Mr Say Yadi both in writing and verbally at meetings about possible redundancy. By leaving the meeting on 2 June 2014 Mr Say Yadi lost the opportunity to discuss this matter further with Mr English and Mr Lewer.
[87] I am satisfied that Plasmatronics complied with its obligations under the Award.
Could Mr Say Yadi have been redeployed?
[88] There was no evidence that there was any position to which Mr Say Yadi could have been redeployed. Mr Say Yadi complained that another employee had been employed but the evidence was that this employee had been employed in December 2013 and that his employment status was unchanged.
[89] Mr Say Yadi complained that another employee was not made redundant instead of him. However the decision about who is to be made redundant is a matter for the employer. If as Ms Say Yadi submitted he was selected for redundancy for discriminatory reasons then he could have lodged a general protections application.
[90] I therefore find that Mr Say Yadi could not reasonably have been redeployed.
Conclusion
[91] The termination of Mr Say Yadi’s employment was due to genuine redundancy and therefore Mr Say Yadi’s employment was not terminated unfairly and his application is dismissed.
DEPUTY PRESIDENT
Appearances:
M. Say Yadi on his own behalf.
V. Graham for the Respondent.
Hearing details:
2015.
Melbourne:
2 and 26 February.
1 Exhibit R2 at [3], [6]
2 Ibid at [8]
3 Ibid at [11]
4 Ibid at [12]
5 Ibid at [13]
6 Ibid at [15]
7 Ibid at [17]
8 Ibid at [18]
9 Ibid at [21]
10 Transcript PN 150
11 Transcript PN 157
12 Exhibit R5 at [1]-[16]
13 Ibid at [27]-[30]
14 Ibid at attachment E
15 Ibid at attachment F
16 Ibid at attachment G
17 Ibid at attachment F
18 Transcript PN 352
19 Ibid PN 365
20 Ibid PN 369
21 Ibid PN 381
22 Ibid PN 384
23 Ibid PN 396
24 Ibid PN 399-402
25 Exhibit R4 at attachment B
26 Transcript PN 406
27 Ibid PN 416
28 Exhibit R7 at [1]-[4]
29 Ibid at [5]
30 Ibid at [5]
31 Ibid at [10]
32 Ibid at attachment D
33 Ibid
34 Ibid
35 Ibid at [11]
36 Transcript PN 198-202
37 Ibid PN 213
38 Ibid PN 215
39 Ibid PN 225
40 Ibid PN 243
41 Ibid PN 247
42 Ibid PN 267
43 Exhibit R1 at [4]
44 Ibid at [5]
45 Ibid at [6]
46 Ibid at [7]
47 Ibid at attachment B
48 Transcript PN 447
49 Ibid PN 449
50 Ibid PN 451
51 Ibid PN 452
52 Ibid PN 453
53 Ibid PN 455
54 Ibid PN 461
55 Ibid PN 461
56 Ibid PN 465
57 Ibid PN 473
58 Ibid PN 488
59 Ibid PN 489
60 Ibid PN 494
61 Ibid PN 496-497
62 Exhibit A2 at E2
63 Exhibit A1
64 Exhibit A2
65 Ibid at H6
66 Exhibit A1
67 Exhibit A2
68 Transcript PN 560
69 Exhibit R2 attachment C
70 Exhibit R2 at attachment D
71 Exhibit A2
72 Ibid A2
73 Exhibit R4 at attachment D
74 Exhibit R7
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