Mr B N v RPS Energy Pty Ltd
[2021] FWC 6364
•16 NOVEMBER 2021
| [2021] FWC 6364 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Mr B N
v
RPS Energy Pty Ltd
(U2021/4618)
COMMISSIONER HUNT | BRISBANE, 16 NOVEMBER 2021 |
Application for an unfair dismissal remedy – jurisdictional objection – genuine redundancy – objection upheld – application dismissed.
[1] On 28 May 2021, Mr BN made an application for unfair dismissal remedy under s.394 of the Fair Work Act2009 (the Act) to the Fair Work Commission (the Commission) alleging he had been unfairly dismissed by his employer, RPS Energy Pty Ltd (the Respondent) on 7 May 2021.
[2] The Respondent raised a jurisdictional objection to Mr BN’s application, that the termination of his employment was a case of genuine redundancy as defined in s.389 of the Act.
Background
[3] On 10 September 2012, Mr BN commenced employment with the Respondent as a Senior Consultant, Safety and Risk. He reported to Mr Paul Clothier, Business Manager, HSE and Risk Management.
[4] From around 2015, Mr BN’s wife, Ms TN commenced working for the Respondent as Mr BN’s administrative support. Ms TN reported to Mr Clothier. Both Mr BN and Ms TN worked from their home office since around 2018.
[5] Mr BN stated that on or around 4 February 2021, despite having been married to Ms TN for some years and working with her, he became aware that Ms TN had misrepresented her identity. Ms TN did not attend for work at the home office from around 4 February 2021, and on 10 February 2021, Ms TN obtained a temporary protection order against Mr BN. The temporary protection order prevented Mr BN from being at his home and usual place of work.
[6] Mr BN was on personal leave from 11 February 2021, he says, due to his shock at learning of the identity issues involving Ms TN and having been removed from his home and workplace.
[7] To the best of Mr BN’s knowledge, both he and Ms TN were made redundant. He was on medical leave at the time, and he considers the Respondent did not have regard to its duty of care to him to provide a safe place of work. Mr BN also obtained a temporary protection order against Ms TN. I have made a confidentiality order with respect to Mr BN and Ms TN on account of the protection orders they have been granted against each other, and in the interest of their children.
[8] On 7 May 2021, the following termination letter was issued to Mr BN:
“Dear [Mr BN],
Termination by Reasons of Redundancy
Further to our call on 4 May and consequent meeting on 6 May 2021, we confirm that unfortunately your employment with RPS will terminate as a result of redundancy effective immediately.
Due to a business restructure and relocation of BowTie services to our offshore branches for cost reduction purposes, the position of Senior Consultant Safety & Risk is no longer needed. This decision is not a reflection on your performance and was not made lightly.
Prior to making the decision to terminate your employment as a result of redundancy we took your feedback into consideration, being:
• Possible redeployment
As mentioned in our meeting the business has limited opportunities available in the Brisbane/Gold Coast region that would be a suitable position for your experience and skillset.
Due to your employment ending because of redundancy, your redundancy payment will comprise:
• Pay in lieu of notice period;
• Severance pay; and
You will also be paid your accrued leave entitlements and any outstanding pay up to and including your last day of employment. This includes superannuation. Employee Assistance Program services (as outlined in the discussion) will be made available to you and your Statement of Service is enclosed for your reference.
Confidential Information
You are reminded that your Employment Agreement requires that you do not disclose confidential information relating to the business and the operations of RPS Group and its clients where the unauthorised use or disclosure could be detrimental to them. This includes confidential information relating to trade secrets, operations, marketing, personnel, finance, clients and other confidential information belonging to the company and its business.
Company Property and Information
As discussed in our meeting please provide me with an address and I will arrange for the collection of RPS belonging:
• all assets belonging to the company that are currently in your possession or under your control including all relevant receipts for company incurred expenses; and
• all confidential information, documents and other material, in both hard and soft copy, relating to the affairs of RPS or any of its’ clients.
Your final payment will be credited to your bank account on receipt of the above items.
Thank you for the contribution you have made to our business and we wish you every success for the future.”
Hearing of the application
[9] I listed the matter for a Teams video hearing on 25 August 2021. Mr BN appeared on his own behalf, giving evidence in support of his application. Ms Fiona Stanton of Counsel was granted leave pursuant to s.596(2)(a) of the Act to appear for the Respondent, instructed by Ms Tania Goodacre, HR Business Partner, and Ms Bronwyn Conway of the Respondent. Mr Murray Burling, Managing Director of Energy AAP, and Ms Goodacre gave evidence for the Respondent.
Legislation
[10] Section 385 of the Act provides that a person has been unfairly dismissed if the Commission 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.”
[11] Section 396 of the Act sets out the following:
“The FWC must decide the following matters relating to an application for an order under Division 4 before considering the merits of the application:
(a) whether the application was made within the period required in subsection 394(2);
(b) whether the person was protected from unfair dismissal;
(c) whether the dismissal was consistent with the Small Business Fair Dismissal Code;
(d) whether the dismissal was a case of genuine redundancy.”
[12] As set out above in s.396 of the Act, a consideration as to whether the dismissal was harsh, unjust or unreasonable cannot occur if the dismissal was a case of genuine redundancy. If the Commission determines that the dismissal was a case of genuine redundancy, the application will be dismissed.
[13] Section 389 of the Act provides the meaning of genuine redundancy as follows:
“(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.”
[14] This decision determines the jurisdictional issue as to whether the dismissal was a case of genuine redundancy pursuant to s.389 of the Act.
Respondent’s evidence
Evidence of Mr Murray Burling
[15] Mr Burling is employed by an associated entity of the Respondent and is based in Perth. He is the Managing Director of the business unit entitled ‘Energy AAP’, a group within the Respondent’s business comprised of a number of business units that provide services to the energy sector in the Asia and Asia-Pacific region.
[16] Mr BN provided a service that was managed within Energy AAP’s Safety and Risk consultancy. Mr BN was knowledgeable in relation to Bowtie XP software, a software package designed to assist businesses in risk analysis and risk mitigation. His role involved identifying potential customers for the Bowtie XP software, achieving sales, providing training in the use of the software and providing ongoing support and consultancy services to those customers in relation to their use of that software.
[17] The Bowtie XP software is distributed by CGE Risk. Pursuant to a software sales agreement with CGE Risk, when the Respondent achieved sales or maintenance renewal of Bowtie XP software, it received a commission from CGE Risk. Those commissions were the primary source of revenue for the Respondent. A further source of revenue was the consultancy service provided by Mr BN in respect of which customers paid consultancy fees.
[18] The Respondent had maintained a website for many years using the domain name, ‘bowtiexp.com.au’. Leads for customers who may be interested in buying the Bowtie XP software could be identified and generated from this website. The website was the principal source of new custom in respect of sales of the Bowtie XP software. Mr BN would chase leads obtained from the website.
[19] The domain name ‘bowtiexp.com.au’ was relinquished by the Respondent in 2019 through negotiation and mutual agreement with CGE Risk. Following the relinquishment of that domain name, the Respondent has relied on sales leads provided to it by CGE Risk. Relinquishment of the domain name has led to a reduction in the number of sales leads available to the Respondent. Mr Burling surmised this had adversely affected the profitability of the service and it is likely to continue to adversely affect the profitability of the service.
[20] Since late March 2020, the financial performance of the entire Energy AAP group of businesses has declined as a result of the COVID-19 pandemic. The declining performance necessitated a thorough, ongoing review of the performance of all of the business units within Energy AAP. From late March 2020, business reviews were undertaken, initially on a weekly and sometimes daily basis at both global and regional levels. These reviews continued with intensity through much of the remainder of 2020, at varying intervals.
[21] Mr Burling, together with others, made decisions based on ongoing profitability. Employees were asked to reduce their hours of work, and in some cases to reduce their salaries. When employees resigned, generally they were not replaced, and when contractors reached the end of their contracted service period, generally they also were not replaced. Some senior level positions were also made redundant during this time, and there was consequential role re-assignment amongst senior staff.
[22] The Energy AAP business was subject to significant financial losses during the year ending 31 March 2021. These losses were progressive and were the catalyst to several of the above management decisions taken throughout this period. At the end of March 2021, despite all actions taken, the losses to this business unit had totalled $716,000.
[23] As a result of these ongoing reviews, Mr Burling was aware of the declining performance of the service provided by Mr BN in selling the Bowtie XP software. In mid-April 2021, Mr Burling held two meetings with his colleagues, Mr John Stanton and Mr Clothier in relation to this aspect of Energy AAP’s business. Mr Clothier was Mr BN’s manager. Mr Stanton is a Business Development Director, formerly General Manager, and Mr Clothier’s manager.
[24] In his role, Mr Stanton had oversight of the Respondent’s staff based throughout the Asia-Pacific region. During the first meeting, it was discussed that perhaps Mr BN’s role, together with an administration team member assisting him (Ms TN) be reallocated to existing, underutilised staff in other offices within the Asia-Pacific region. Mr Stanton resolved to review the available staff and their capacity to take on these duties.
[25] The next time Mr Burling met with Mr Stanton and Mr Clothier, they both confirmed that there was an employee based in the Respondent’s Kuala Lumpur office who was knowledgeable in relation to the Bowtie XP software, and was providing support to customers based in Malaysia who were utilising that software. It was confirmed that the employee based in Kuala Lumpur had the capacity to absorb Mr BN’s functions, so that if Mr BN was made redundant, the role could be undertaken by the employee based in Kuala Lumpur at no additional cost to the Respondent, thereby saving the Respondent all of the costs associated with the service being provided by Mr BN and his assistant.
[26] Mr Burling considered that this course of action was worthy of careful consideration, as it was likely to achieve substantial cost savings. He considered that an employee located in Kuala Lumpur would be able to provide the service remotely at an adequate level. He took into account that face-to-face contact requirements were minimal and unlikely to change significantly in the near term due to COVID-19 related restrictions.
[27] After the second meeting with Mr Stanton and Mr Clothier, Mr Burling undertook an analysis with the assistance of a member of the Respondent’s finance team for the purpose of identifying the financial impact of making redundant the positions of Mr BN and the administrative assistant employed to support him. Mr Burling sent a detailed memo to senior personnel on 27 April 2021 providing an analysis of the consideration. His recommendation was as follows:
“Recommendation
After reviewing the performance, it is apparent that the cost base of the business, both direct and overheads, is not sustainable at the present revenue levels. There is income to be made and the long-term maintenance sales should at least have some security around them.
An internal team comprised of myself, Paul Clothier and John Stanton has reviewed a variety of cost reduction options in discussion and believe that the business needs and current activity levels can be supported by existing staff in our Malaysian office in Kuala Lumpur (KL). We have an individual in that office that is presently under-utilised and who has skills in the Bowtie software, having made sales and conducted training in the Asian region previously. There are also a number of administrative staff in the KL office who could take on the administrative function required for the sales and renewals management processes.
Absorbing the sales function into already employed staff in Malaysia will significantly reduce the operating costs, providing further support for the KL office and will also insulate us against the future risk of the sales contract being revoked.
Moving the business base to KL means that the two roles here in Australia will be redundant. The sales manager has been with RPS for 8 years, while the administrative assistance 6 years. Both are aged over 45. The total redundancy cost to the business is estimated to be $67,500, with additional payment of some significant accrued leave entitlements bringing the total exit cost to just under $140k. Leave entitlements, although significant, will have been accrued in the accounts.
We will make savings of approximately $ 170k in direct salary costs over the remainder of 2021, with an undefined reduction in other overhead costs. Net of redundancy costs the business is expected to be at least $100, 000 better off over the remainder of 2021, with an improved outlook in 2022.
We do expect some disruption initially as the process is transferred without handover due to the circumstances. However, we are confident in the ability of the team to minimise the disruption and manage the transition effectively.
We are now ready to implement as soon as possible, pending your approval to proceed, which I accordingly now request.
Please let me know if you need further detail.”
[28] At the time Mr Burling undertook the analysis of the Bowtie XP service, he was aware that Mr BN had been absent from work for personal reasons, and he considered that his absence had contributed to the poor financial performance of the service. While he expected that Mr BN would be capable of returning to work, and potentially improving the sales performance, he considered that the recent market history indicated that a substantial improvement was unlikely.
[29] Mr Burling also had regard for the potential cost savings to be gained by utilising staff in Kuala Lumpur who had spare capacity, and considered it was necessary to improve the overall performance of the Energy AAP business.
[30] On 27 and 29 April 2021, the two senior managers respectively approved the redundancies of Mr BN and the administrative assistant on the basis that the work would be performed by an existing employee in Kuala Lumpur.
[31] Mr Burling’s evidence is that at that time he made a decision to make Mr BN’s role redundant, together with that of his assistant. He expected that there was a limited possibility for the redeployment of Mr BN elsewhere within the Respondent and its associated entities because the group of companies was avoiding creating new roles or filling vacancies so far as was possible while it recovered from financial distress caused by the COVID-19 pandemic.
[32] On 4 May 2021, the following letter was sent to Mr BN:
“Dear [Mr BN]
Your employment with RPS - Notice of Redundancy
RPS has recently reviewed its business structure regarding the particular services provided to RPS clients by yourself as the Senior Consultant Safety & Risk, and with the assistance of the Client & Sales Administrator.
RPS has determined that this part of its business should be conducted from RPS's office in Kuala Lumpur in Malaysia rather than from Australia.
Relocating the business unit to Kuala Lumpur will result in the elimination of your position with RPS and will necessitate the termination of your employment on the grounds of redundancy.
Attached to this email is an indicative calculation setting out the estimated gross and net entitlements you will receive upon termination for redundancy.
RPS is obliged to consult with employees in relation to pending redundancy. One of the purposes of such consultation is to provide an opportunity for an employee to bring to an employer's attention any particular matters of which the employer may be unaware which are relevant to the impact of redundancy upon the employee.
I invite you to engage in the consultation process either by meeting with me and Tania Goodacre – HR Business Partner, discussing the matter with me by telephone or raising any issues you wish to bring to RPS's attention by email [redacted] and cc [redacted]. To the extent you want to meet with me in person/video link or discuss the matter by telephone, you are welcome to have a support person with you.
If you wish to meet, I have prescheduled a time for Thursday 6 May 2021 via video link (Teams) at 12:30 pm AEST.
Please let me know by return email and by no later than 5:00 pm AEST on Wednesday 5 May 2021 whether you wish to engage in the consultation process and, if so, by what means.
In the meantime, should you wish to discuss the matter, please do so only with me or Tania Goodacre – HR Business Partner.”
Evidence of Ms Tania Goodacre
[33] Ms Goodacre is employed by the Respondent’s associated entity in the role of HR Business Partner. On 4 May 2021, Ms Goodacre and Mr Clothier attempted to contact Mr BN by telephone in order to have a discussion with him. They were unable to reach him. Later, on 4 May 2021, Ms Goodacre learned that the letter above at [32] was sent by Mr Clothier to Mr BN.
[34] On 6 May 2021, Ms Goodacre and Mr Clothier conducted a telephone conference with Mr BN in relation to the pending redundancy of his position. Ms Goodacre’s notes of the telephone conference are produced below:
“6 May 2021 - 2:30pm AEST meeting with [Mr BN] and his support person [redacted], Tania Goodacre HRBP and Paul Clothier.
Meeting commenced and PC followed the talking points provided:
• RPS Energy has reviewed the business structure, with respect to the services of BowTie, against the financial needs and objectives of the business. As such, they have decided to relocate this business to Kuala Lumpa [sic] in order to reduce costs.
• Unfortunately, this means that your position as Senior Consultant, Safety & Risk and the position of Client and Sales Administration position will be directly impacted and will be made redundant
• This will be effective from 7 May 2021
• We understand that this decision may come as a shock to you. Do you understand what I have said so far?
• In your letter, we included an indicative calculation of your redundancy package (severance, payment in lieu of Notice), including hours worked and accrued entitlements. Do you have any queries regarding this breakdown?
- I can confirm that the Genuine Severance component - Section 4 is Tax-free
- Section 5 - is your accrued entitlements less Tax - Long Service - the prorated amount of your LSL is paid out based on your tenure with RPS
- Section 6 - is superannuation to be paid on the Notice in lieu payment
- Section 7 - is your TOTAL indicative amount to be paid
- Any hours worked up to your final date of employment will be paid on top of this amount and taxed per your regular pay
- This does not include any monies owing to RPS by the employee -
• To support you through this transition, we will provide you with free sessions with our outplacement partner Trevor Roberts, who can assist you throughout the transition by providing you with contemporary and highly practical career advice for now and in the future. - Tania will email you the details separately.
• With this, you will also have access to the EAP - Centre for Corporate Health [redacted] or via the online MySupport Portal. Logan details are provided in the attached flyer.
• Based on this information and the situation of the business, is there anything you would like us to consider in making our final decision? Or do you have any queries for us?
[Mr BN] responds:
• [Mr BN] - I agree with most things, there has been a reduction in sales, reduction in travel and reduced hours across the business.
• [Mr BN] - Why had it never been raised with him that business was losing money and that the targets have never been readjusted.
• PC - said we were cross pollinating and subsidising the shortfalls from other areas of the business. However that was no longer viable as other areas are also struggling.
• [Mr BN] - I don't think it will work with some Australian clients. We are able to What will you do with the Australian clients who use us because we are in Australia?
• PC - These discussions are being had with CGE and our clients. We have advised them that support will continue to be provided to them, however general support will be done by our team in KL.
• [Mr BN] - Is there any opportunity to be redeployed to another part of the business?
• TG - I will certainly have a look at suitable opportunities for you. However, there are none within Energy in Brisbane/Gold Coast, would you be able to relocate to another state?
• [Mr BN] - No, I can not commit to any role or travel at this point in time.
• TG - Okay I will check within our AAP division in Brisbane and see if there are anything suitable in the region.
Paul Clothier closed out meeting
• Do you have any other questions?
• [Mr BN] I want to thank you for your service and all that you have brought to the Safety & Risk division. From a personal perspective, you have been a valued team member and a joy to work with.
• We will consider the redeployment opportunities and come back to you tomorrow with the final decision.
• Thank you for your time.”
[35] On 7 May 2021, Ms Goodacre added to the earlier notes to include information provided to her by Mr Clothier in relation to Mr Clothier sending a letter to Mr BN advising him that his employment had been terminated for redundancy. The letter is above at [32].
[36] Ms Goodacre’s evidence is that when Mr BN asked if there was any opportunity to be redeployed into another part of the business, she knew that there was no opportunity for redeployment within the Energy AAP business. Ms Goodacre knew that if there were opportunities in other parts of the business, they would not be located in Brisbane. She considered she asked Mr BN a threshold question as to whether he would be willing to relocate. Her evidence is that Mr BN immediately responded that he would not be able to relocate or travel for the purpose of work.
[37] Ms Goodacre’s evidence is that, notwithstanding Mr BN’s response, she told him at the conclusion of the meeting that she would consider redeployment opportunities and come back to him. After the telephone conference, she made enquiries by searching electronically for roles with any company within the RPS Group anywhere in Australia. She determined that there were no job vacancies suitable for Mr BN, and that there were no job vacancies at all in any part of the business based in Queensland, except as a surveyor, a surveyor’s assistant and a receptionist.
[38] It is Ms Goodacre’s evidence that the results of her enquiries were made known to Mr BN within the termination letter.
[39] In cross-examination, Mr BN put to Ms Goodacre that his performance appraisal indicted that he would be prepared to work in South-East Asia. Ms Goodacre responded that Mr BN had specifically said during the meeting held with him that he could not be relocated. Mr BN agreed with Ms Goodacre’s evidence and said that the reason he could not do so was based on medical grounds.
Evidence introduced during the hearing or following the hearing
[40] During the hearing and following the hearing, leave was granted for further documents to be admitted into evidence. On 22 March 2021, Mr Clothier sent the following letter to Mr BN:
“Dear [Mr BN],
Your employment with RPS Energy Pty Ltd
I refer to recent communications in relation to the matters arising as a result of [Ms TN] obtaining a Temporary Protection Order (TPO) from the Southport Magistrates Court pursuant to the Domestic and Family Violence Protection Act 2012.
I would be grateful to have your thoughts as to whether the business unit could operate using the following mode of communication, on a trial basis:
1. You email to me all instructions to be actioned by [Ms TN];
2. I would read your emails to ensure that they did not contain any content relevant to any matter other than the business of RPS;
3. I would transpose into a separate email the instructions and any explanatory information provided by you;
4. I would send that email to [Ms TN];
5. [Ms TN] would undertake the necessary work; and
6. In respect of any communication then required, [Ms TN] would email me that communication and I would transpose that communication into a separate email and email you.
I have made this proposal in an effort to protect you from any allegation of breach of the TPO and to allow the business unit (consisting of yourself and [Ms TN]) to continue to operate.
Could you please let me know if you consider this proposal would be workable and, if so, whether you would be prepared to proceed in this way on a trial basis?
If you consider that the proposal has been rendered unnecessary by any amendments to the TPO, and if you believe that email communications can proceed between yourself and [Ms TN] directly, both lawfully and without any practical difficulty, please let me know.
I also acknowledge that you have raised certain queries with myself. I understand that you may be unable to access certain equipment that you require to perform your role.
Could you please provide me with an itemised list of such equipment so that I may raise this with [Ms TN] and ask her to return that equipment to RPS’s Gold Coast office?
You have sought a letter from RPS advising of the date on which you commenced employment and seeking a description of your role. In light of that request, I attach a statement of service and a copy of your position description.
You have asked whether similar information can be supplied to you in relation to [Ms TN]. I am not able to furnish you with a counterpart letter for [Ms TN]. There would be no impediment to this being supplied to [Ms TN] directly.
The present circumstances between yourself and [Ms TN], and their impact upon your work, are likely to be causing you distress. I urge you to take advantage of the availability of EAP counselling.”
[41] The Temporary Protection Order of 10 February 2021 where Ms TN is the aggrieved was admitted into evidence, together with a variation of that order dated 23 February 2021, and the order taken out by Mr BN against Ms TN dated 23 February 2021.
[42] On 22 April 2021, Mr Clothier sent the following email to Mr BN:
“Hi [Mr BN],
I hope you are doing well.
I have approved your leave application to the 16 of May but in doing so I do need to get some information on how we are to manage issues in your absence.
As you know we have training courses advertised on the website and we need to remove these until we have some clarity on the way forward. Please can you send me the password for the website so that we can make these changes.
Secondly we cannot find the latest training material on the server. Is this on your laptop? Can you either advise where it can be found on the server or, if on your laptop, lodge the material on the R drive.
Thirdly can you let me know how you would like us to communicate your absence to CGE (WK). To date we have just said you were on extended leave until the 15th of April but clearly we have to update them. Similarly we will need to advise anyone that calls to speak with you for sales etc.
[Mr BN], please remember that we do offer various support options to staff and should you wish to avail of it, the details are attached for your information.”
[43] During the hearing it was explained that Mr BN was paid 14 weeks’ severance and five weeks’ notice on termination being an amount of $50,035.77, in addition to his annual leave and long service leave entitlements.
Submissions of the Respondent
[44] The Respondent responded to Mr BN’s written submissions as follows.
[45] It was submitted that the decision to make Mr BN redundant was made on 29 April 2021, and the purpose of the letter of 4 May 2021 was to commence consultation with him. It was submitted that the letter then provided Mr BN the opportunity to bring to the Respondent’s attention any particular matters of which the Respondent may be unaware relevant to the impact of redundancy on Mr BN.
[46] It was submitted that it was not relevant whether Mr BN worked from home or from the Respondent’s office. In fact, it supports the Respondent’s reasoning for relocating the work offshore.
[47] As to Mr BN’s concern that he was made redundant while absent from work, it was submitted that Mr Burling’s analysis that the service line was not performing well even before the period of Mr BN’s absence, and that, by reason of factors beyond Mr BN’s control, the service was not likely to be commercially viable upon his return to work.
[48] It was submitted that the role was not made redundant while an employee was absent on a short period of sick leave; the period of leave had persisted at least since the time when the briefing note was prepared. It was submitted that there was no fixed date or an imminent date for Mr BN’s return, and in those circumstances, given the commercial imperative to make the positions redundant, it was reasonable for the Respondent to act notwithstanding that Mr BN was absent. It was put by the Respondent that there was nothing unusual or unfair about dealing with Mr BN by email.
[49] The Respondent submitted that office accommodation was available to Mr BN if he could not work from home, and this had been offered to him.
[50] The Respondent rejects Mr BN’s submissions that he had been a victim of “fraud or coercive conduct by a co-worker”. The Respondent submitted that it is insupportable to contend that, whatever the personal circumstances that had given rise to Mr BN’s absence, the Respondent should defer implementing a commercial decision in the face of persistent losses incurred by the service line and the relevant business unit on account of those personal circumstances.
[51] It was submitted that the Energy AAP group of the Respondent had suffered a decline in its financial performance due to the COVID-19 pandemic, a loss of in excess of $700,000 in the 12 months ending 31 March 2021. Mr Burling was tasked with leading a process of reviewing every facet of the Energy AAP business in order to identify cost savings for that business. This process began in 2020.
[52] As a result of this process, it was ascertained that the functions performed by Mr BN could be undertaken by existing staff based in the Respondent’s Kuala Lumpur office. The savings that could be achieved by making Mr BN and Ms TN redundant in the remainder of that year were $170,000 per annum in direct salary costs as well as a reduction in overhead costs associated with supporting the provision of the service out of the Respondent’s Brisbane office.
[53] None of the circumstances outlined in the briefing note to senior management related to any poor performance or misconduct on the part of Mr BN.
[54] The Respondent submitted that although Mr BN was not covered by an award or an enterprise agreement, it nevertheless undertook a consultation process with Mr BN prior to implementing the redundancy of his position. At the time that he undertook that consultation process, Mr Burling knew that there were no opportunities to re-deploy Mr BN elsewhere within Energy AAP, in that the business was seeking to cut costs by reducing staff numbers - it was not in a position to create new roles and it was generally not replacing employees who resigned.
[55] It was submitted that during the consultation process, when Mr BN raised the question of redeployment, he was asked if he would be prepared to relocate, and he advised that he was not able to do so. There were no roles available with any entity in the Respondent’s associated entities for a person with Mr BN’s skills based out of its Brisbane office. It was submitted that redeployment of Mr BN was, in the circumstances, impossible. This was conveyed to Mr BN in the termination letter dated 7 May 2021.
[56] The Respondent noted that Ms TN’s role of administration assistant was also made redundant. Initially, it had been decided by the Respondent that the administration functions would be carried out by staff in Kuala Lumpur. However, subsequently, the Respondent decided to have the administrative functions associated with the service carried out by employees based in its office in Jakarta.
[57] Having regard to the considerations at s.389 of the Act, it was submitted that Mr Burling’s evidence demonstrates that the Respondent was motivated to undertake a review of the relevant service as a result of the business unit within which that service was managed suffering substantial losses, giving rise to a need to cut costs wherever possible. That was the fundamental reason for re-distributing Mr BN’s duties to existing staff who were underutilised - there would be a substantial net reduction in costs while the Respondent continued to make the service available to its customers.
[58] It was submitted that while various matters were raised in the briefing note to senior management, the ultimate reason for the redundancy was the capacity to reduce costs by redistributing the service line to other staff and thereby to stem the losses suffered by the Energy AAP business unit.
[59] The Respondent submitted that while s.389(1)(b) has no application to this case as Mr BN was not covered by an award or enterprise agreement, in any event the Respondent applied an award-compliant consultation process.
[60] Having regard to s.389(2), it was submitted that this is not a case in which it would have been reasonable to redeploy Mr BN because there were no opportunities for his redeployment within the Respondent or any of its associated entities.
Mr BN’s evidence and submissions
[61] Mr BN’s employment details and brief run-down of his relationship with Ms TN is detailed at paragraphs [3-7] above.
[62] Mr BN stated that the shock of being required to move from his home and workplace in early February 2021 was exacerbated by the Respondent passing his personal and private information on to Ms TN without his knowledge, including the duration and extension of his medical leave.
[63] Mr BN stated that he disclosed to the Respondent that he had taken out a private cross order against Ms TN as he was defending his name and reputation. He was obtaining medical support to get him through the anxiety, distress and trauma that he found himself in.
[64] Mr BN contends that the Respondent did not act in good faith, but rather has been contentious in ensuring the redundancy notice was emailed just two days prior to the meeting of 6 May 2021, with termination taking effect on 7 May 2021. He submitted that the internal dialogue approving the redundancy demonstrates that it was pre-arranged with no recourse for reversal.
[65] He stated that during the meeting on 6 May 2021, while he was verbally acknowledged and credited for the extensive revenue and success derived by the Respondent through his years of “stellar service” in the role, there was no initiation to explore any options of redeployment. Mr BN stated that when he raised redeployment opportunities, he was informed that he would be well-suited to management positions, and Ms Goodacre committed to scouting opportunities within the group of companies and reverting to him.
[66] Mr BN stated that this was never followed-up on, nor any alternative option offered.
[67] In responding to the Respondent’s material, Mr BN stated that the Respondent was aware that his role encompassed a variety of tasks beyond merely the BowTieXP software sales; it encompassed various other bodies of work such WHS auditing, WHS training, software application training, risk workshop facilitation and consultancy work. It also covered a range of other capabilities as documented in the HSE capability statement.
[68] Mr BN stated that his role involved travel of 40-50% of the time locally, interstate and internationally for the purpose of training delivery, consultancy, facilitation, business development and consultancy. In addition, various in-house events were also conducted at clients’ premises. This required travel interstate and internationally.
[69] Mr BN listed a large number of duties he said he performed in his role:
• Bowtie software sales;
• Bowtie training;
• Facilitate risk workshops;
• Provide risk consultancy services;
• Permit to work training (i.e., WPTW);
• IncidentXP, Incident Investigations;
• Auditing and Audit Training;
• Develop audit tools for the Oil and Gas sector;
• Conducting third party audits and audit report reviews;
• Develop proposals for various other bodies of work as required;
• Develop registers for high-risk activity;
• Support and mentor other staff;
• Website content development and management;
• Develop and document internal frameworks and processes;
• Develop and implement business strategy; and
• Manage client accounts, revenue and financial processes.
[70] Mr BN submitted that it was his performance that “propped up” and increased the Respondent’s revenue during the downturn and he used his role to diversify the client base that grew business performance and increased revenue for RPS. He stated that there were regular commendations on his performance every month from his immediate manager.
[71] On 22 March 2021, Mr Clothier sent the following email to Mr BN:
“Hi [Mr BN]
Following our telephone conversation last week, I have discussing (sic) your requests with Murray and Bronwyn.
I have attached a statement of service.
With regards to your position description I noted that the current position description did not capture your role accurately being based on a more generic Senior Consultant role.
I have drafted a new position description which I believe more accurately reflects your role. Please can you review this and, if acceptable, sign and return to me. You can then use this as evidence of your role.
I have also attached a letter which lays out a proposed process for you to conduct business communication with [Ms TN] to enable you both to continue to undertake your roles without potentially breaching the terms of the TPO.
I cannot provide [Ms TN’s] role description to you. However her role is that of Client and Sales Administration.
Should you have any queries please let me know.
Kind regards”
[72] A signature of 2 April 2021 of Mr BN is attached to the updated position description.
[73] On 22 April 2021, Mr BN sent the following email to Mr Clothier:
“Re: Working Arrangements
Dear Paul,
Thank you for your letter dated 22 March 2021. As you are aware, I have been dealing with various personal matters at multiple jurisdictions which has impacted my personal wellbeing.
This letter follows my brief email dated 24 February 2021 to RPS disclosing the circumstances that I have found myself in.
I would like to thank you for the statement of service provided. I have been a committed long-term employee that takes a lot of pride in my work commitments and have demonstrated that my performance contributes to business success.
Current Personal Status
Please be informed that apart from contesting the vexatious TPO against me by [Ms TN], a cross application has been made with a TPO in my favour, where I am the aggrieved. Both these matters are being run at the Southport Magistrates Court concurrently. Meanwhile, there are also proceedings at the Brisbane Federal Court for the family matters in finalising separation. There are further investigations and related matters in other jurisdictions which I have initiated. These are current and pending. Some details are listed herein.
Response to working arrangements
In response to your suggested "trial", unfortunately the conditions placed in the TPO and the risks associated are too great while the order is in place for the following reasons:
• My recent discovery of misleading and false information by [Ms TN] (from the onset of our relationship) as well as falsification of legal documentation has resulted in her pursuing false allegations against me at the Southport Magistrates court. Hence the current TPO is in place which is contested and I am challenging the same. A cross application was made at the Southport Magistrates Court against [Ms TN] in my favour.
• I discovered that [Ms TN] made several false declarations in various government applications to conceal her true identity which is now being reported and investigated by the relevant authorities.
• I have to defend my ·reputation and pursue the protection of my children including my wellbeing as work matters and family matters have been intertwined in allegations made by [Ms TN]. The above matters are ongoing and scheduled for further court hearings.
• As a professional, I have at all times attempted to keep personal and private matters separate. Unfortunately, I am now forced into a situation to disclose and respond to matters raised where communications between RPS and [Ms TN] have been submitted to the courts by [Ms TN] to which I have to respond. This includes communication between yourself and [Ms TN] in reference to our working arrangements and my leave status etc.,
• [Ms TN] has previously commented about the hours personnel worked, the time sheet approval status, manager comments made etc., All along, I was of the impression that [Ms TN] has access to personal records for legitimate business purposes but that does not appear to be the case. It has also become apparent that that my work emails, computer, phone have been checked on various pretexts. As a result, her intentions are questionable. As such I do not wish to be compromised in any way.
• There is a risk that the use of systems such as MS Teams, or other software applications could be raised as stalking and surveillance. To that effect there has been new fabricated allegations made by [Ms TN] in recent court documents. In light of this I choose to be prudent and cannot work and function as a team even through an intermediary.
• I am concerned of the risk of using commonly accessed systems and data files can raise HR based issues in the workplace.
• I fear the ability to freely communicate in the workplace.
• To make things clear, I have no faith and a complete lack of trust to be able to work with [Ms TN] in any capacity directly or indirectly.
• With regard to EAP counselling, I appreciate the offer and have alternative arrangements in place for now.
Alternate Working Arrangements:
• I propose for myself to be able to work independently to be self-managing and self-sustaining commencing from my return after leave.
• The ability to work independently or without any dependency of shared responsibility with [Ms TN].
• The ability to having a home office set up, I am working on finding myself a suitable place to reside and work from.
• The ability to have alternate staff to independently assist with administrative tasks for timely and efficient client and support services should it be required
I am happy to speak directly for any further information or clarification.”
[74] Mr BN stated that the Respondent did not respond to his letter of 22 April 2021. The next communication to him was the redundancy letter dated 4 May 2021.
[75] Mr BN submitted that the considerations for redundancy put by Mr Burling for senior management’s consideration were not accurate, nor were they discussed with him.
[76] Mr BN considered that the Respondent should have informed him about his eligibility to take domestic violence leave which he considers he would have been entitled to. Mr BN submitted the following:
“To push someone who is already down and out and going through unimaginable trauma from being a victim of fraud and coercive conduct by a co-worker and who had no option but to take medical leave, is in my opinion inhumane conduct.”
[77] Mr BN submitted that the redundancy meeting on 6 May 2021 was held merely to confirm the redundancy notice that had been emailed to him. He considered that it was merely a formality as opposed to a genuine intent to discuss or consider deployment options.
[78] In evidence given during the hearing, Mr BN conceded that he was offered the ability to work from the Brisbane office when he could no longer work from his former home. He stated that he declined the offer as he feared that he would be electronically stalked by Ms TN.
Consideration
[79] I turn now to a consideration of the criteria set out in s.389 of the Act. For Mr BN’s dismissal to be a case of genuine redundancy, the Respondent must meet each of the criteria set out in s.389 of the Act.
s.389(1)(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
[80] The test to be considered where there has been a reorganisation or redistribution of duties is whether the employee has any duties left to discharge.1 Where there is no longer any function or duty to be performed by an employee, his or her position becomes redundant even where aspects of that employee’s duties are still being performed by other employees.2
[81] The decision in Kekeris v A. Hartrodt Australia Pty Ltd T/A a.hartrodt3 considered this point and established that the test is whether the previous job has survived the restructure or downsizing, rather than a question as to whether the duties have survived in some form. The Full Bench in Ulan Coal Mines Limited v Howarth and others4 considered and applied the decision of Ryan J in Jones v Department of Energy and Minerals5 and said:
“[17] It is noted that the reference in the statutory expression is to a person’s “job” no longer being required to be performed. As Ryan J observed in Jones v Department of Energy and Minerals (1995) 60 IR 304 a job involves “a collection of functions, duties and responsibilities entrusted, as part of the scheme of the employees’ organisation, to a particular employee” (at p. 308). His Honour in that case considered a set of circumstances where an employer might rearrange the organisational structure by breaking up the collection of functions, duties and responsibilities attached to a single position and distributing them among the holders of other positions, including newly-created positions. In these circumstances, it was said that:
“What is critical for the purpose of identifying a redundancy is whether the holder of the former position has, after the re-organisation, any duties left to discharge. If there is no longer any function or duty to be performed by that person, his or her position becomes redundant…” (at p.308)”
This does not mean that if any aspect of the employee’s duties is still to be performed by somebody, he or she cannot be redundant (see Dibb v Commissioner of Taxation (2004) FCR 388 at 404-405). The examples given in the Explanatory Memorandum illustrate circumstances where tasks and duties of a particular employee continue to be performed by other employees but nevertheless the “job” of that employee no longer exists.”
[82] I accept Mr Burling’s evidence as to the considerations made by the Respondent in April 2021, where it determined that it could make significant cost savings if it had the work Mr BN had been performing conducted from Kuala Lumpur by an existing, underutilised employee. While Mr BN had been a valuable and hard-working employee, the cost saving in making his role redundant was enticing to the Respondent. The cost saving per annum was substantial.
[83] I accept the Respondent’s evidence that the offshore employee was relevantly skilled and could meet the requirements of the Respondent such that the Respondent would no longer require Mr BN to perform the role from Australia. It is not for the Commission to consider if the Respondent would not be able to adequately service its Australian clients and if they would have preferred it be serviced by an employee in Australia. Those matters are entirely for the Respondent to determine.
[84] Not only did the Respondent do away with Mr BN’s role in Australia, it also made Ms TN redundant and her role is now performed out of Indonesia. The Respondent determined to remove both roles from its Australian operations.
[85] While Mr BN may rightly feel concerned that the timing seemed harsh, and it was convenient for the Respondent to remove the problem of two employees being involved in an acrimonious marital split, I do not accept that this is the reason for the roles being moved offshore. I determine that the timing of the redundancies was coincidental, but it was not the reason for the decision to terminate Mr BN’s role.
[86] The Respondent was entitled to take the action which it did, when it did. While it is preferable not to make an employee redundant while they are on paid personal leave, it is not unlawful to do so where it does not form the reason for the dismissal. In this case, I do not find the fact that Mr BN was on paid personal leave had any bearing on the Respondent’s decision to terminate his employment.
[87] I am satisfied that following the changes in the operational requirements of the Respondent’s enterprise, the Respondent no longer required Mr BN’s job to be performed by anyone else. The criterion in s.389(1)(a) of the Act is satisfied.
s.389(1)(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
[88] The obligation on an employer to consult about redundancy only arises when a modern award or enterprise agreement applies to an employee and that modern award or enterprise agreement contains requirements to consult about redundancy.
[89] Having regard to the duties that Mr BN performed and the industry in which the Respondent operates, together with his salary being an amount of $136,940 per annum plus superannuation, I am satisfied that Mr BN was not employed pursuant to a modern award or enterprise agreement.
[90] Mr BN has not claimed to be an award-covered employee and I find that he is not an award-covered employee. Accordingly, there are no consultation obligations for the Respondent to meet. I do note that Mr BN was afforded between 4 May 2021 and 7 May 2021 to provide his views as to the proposed redundancy until it was communicated to him on 7 May 2021.
[91] The criterion in s.389(1)(b) of the Act is not a relevant consideration.
s.389(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.
[92] Whether redeployment of an employee is considered reasonable will depend on the circumstances that exist at the time of the dismissal.6
[93] In Hallam v Sodexo Remote Sites Australia Pty Ltd,7 a Full Bench of the Commission stated the following:
“…..Subsection 389(2) states that 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. Subsection 389(2) places no obligation on an employer to redeploy, or to do everything possible to achieve a redeployment outcome. The exception is applied at the time of dismissal. It operates so that a dismissal that would otherwise be a case of genuine redundancy under subsection 389(1) will not be so if it would have been reasonable in all the circumstances for the person to be redeployed within the employer’s enterprise, or with an enterprise of an associated entity of the employer.”
[94] As the Full Bench observed in TAFE NSW v Pykett,8 to show that it would have been reasonable for the Respondent to redeploy Mr BN, it is not necessary to identify a particular job or position in which Mr BN could have been redeployed. However, the Commission must be satisfied on the balance of probabilities, and based on the evidence, that there was a ‘job or a position or other work’ to which it would have been reasonable to redeploy Mr BN.
[95] On the evidence before the Commission, there was no other job or a position or other work available for Mr BN to have been moved into on or around 6-7 May 2021. Mr BN was not suitably qualified for a role as a surveyor, surveyor assistant or receptionist, nor are these suitable alternative roles. Mr BN expressly stated that he was not, at that time, prepared to move interstate. This, of course, was completely understandable given the family law matters Mr BN wished to prioritise given he has two children with Ms TN.
[96] On the evidence before the Commission, I am satisfied that it would not have been reasonable in all the circumstances for Mr BN to have been redeployed within the Respondent’s business or any of its associated entities.
Conclusion
[97] The jurisdictional objection that the dismissal was a case of genuine redundancy requires two affirmative elements and one negatory element which must be satisfied, so as to establish whether a dismissal was or was not a case of genuine redundancy.
[98] For all of the reasons set out above I am satisfied that Mr BN’s dismissal was a case of genuine redundancy because, as of 7 May 2021, when Mr BN was informed of the termination of his employment:
• The Respondent no longer required Mr BN’s job to be performed by anyone because of changes in the operational requirements of its enterprise;
• The Respondent was not obliged to consult with Mr BN regarding the proposed redundancy; and
• It would not have been reasonable in all the circumstances for Mr BN to be redeployed within the Respondent’s enterprise or the enterprise of an associated entity.
[99] The application is dismissed.
COMMISSIONER
Printed by authority of the Commonwealth Government Printer
<PR735851>
1 Jones v Department of Energy and Minerals [1995] IRCA 292 (16 June 1995), [(1995) 60 IR 304 at p. 308 (Ryan J)]; cited with approval in Ulan Coal Mines Limited v Howarth and others[2010] FWAFB 3488 (Boulton J, Drake SDP, McKenna C, 10 May 2010) at para. 17, [(2010) 196 IR 32].
2 Ibid.
3 [2010] FWA 674.
4 [2010] FWAFB 3488.
5 (1995) 60 IR 304.
6 Ulan Coal Mines Limited v Honeysett (2010) 199 IR 363 at [28].
7 [2017] FWCFB 6847 at [20].
8 [2014] FWCFB 714, (2014) 240 IR 130 at [36].
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