Mr Neil John McDade v Mills Charters Pty Ltd
[2009] FWA 357
•23 NOVEMBER 2009
[2009] FWA 357 |
|
DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
v
Mills Charters Pty Ltd
(U2009/10972)
COMMISSIONER WILLIAMS | PERTH, 23 NOVEMBER 2009 |
Termination of Employment.
[1] This application has been lodged by Mr McDade who is applying for an unfair dismissal remedy under section 394 of the Fair Work Act 2009. The respondent employer is Mills Charters Pty Ltd (Mills Charters).
[2] The application was dealt with by a Fair Work Australia conciliator however the matter was not settled. At the hearing of this matter Mr McDade was self represented and Mills Charters was represented by its Manager Ms Natasha Williams. Evidence was given by Mr McDade, Ms Williams, and Mr Molloy who describes himself as the Director, Secretary and a shareholder of Mills Charters.
Background
[3] Mills Charters operates a number of vessels in Western Australia offering fishing charters and entertainment and tourism packages to the general public. Mr McDade was employed by Mills Charters as a skipper based at the Hillarys boat harbour. Whilst there is some contest between the parties as to how long Mr McDade has been employed he has been employed since at least August 2007. Mr McDade asserts a much longer period of employment however it seems likely from the information provided by the respective witnesses that the employer was another entity other Mills Charters for the earlier part of his work. Nothing of significance turns on this question.
[4] At the time that Mr McDade's employment ended Mills Charters employed only three full-time employees but in addition offered casual engagements from time to time to a pool of 10 crew including skippers and deckhands.
[5] The evidence of Mr McDade was that in mid-July 2009 he was called to a meeting by Ms Williams who advised him that unfortunately his position had been made redundant. She advised that this would take effect in one month. Mr McDade requested that he speak to Mr Molloy about this and repeated this request on a number of occasions but there was never any contact from Mr Molloy over this issue.
[6] Mr McDade's evidence was that at this meeting he was told by Ms Williams that he would be deployed into the casual pool as a skipper/maintainer and that he would get regular work. He says she said that the company could not afford to keep a full-time skipper and would manage things on a casual pool.
[7] On 1 August 2009 Ms Williams approached Mr McDade and said that he was finishing up today and that the company did not need him any more and that contrary to what had been explained on 16 July 2009 he was not going into the casual pool.
[8] After this he was provided with a letter dated 1 August 2009. The copy of this letter was attached to Mr McDade's application. The letter reads as follows:
“Dear Neil,
It is with regret your full-time position at Mills Charters Charters has been made redundant as discussed verbally in person with you on 16 July 2009, and effective from 16 July, as agreed by both parties.
Regards
Natasha Williams
on behalf of Gary Molloy
Managing Director”
[9] Mr McDade submits that what occurred is not a true redundancy because the work of a skipper is still being carried out by others although he agrees under different contractual arrangements. He also argues that the real reason for the termination may be because under his previous contract he was entitled to a pay review every 12 months and this had not been forthcoming notwithstanding his requests and under his previous contract he was not required to work “up North” however Mr Molloy had consistently asked him to work away from the Perth metropolitan area but he had refused.
[10] Further Mr McDade argues that Mills Charters had the opportunity and the obligation to redeploy him into the casual pool.
[11] Mr McDade has provided a range of other evidence on matters regarding his employment however whilst I have taken note of this, largely this is not relevant to the questions the tribunal is now required to determine.
[12] The evidence of Ms Williams is that in 2008 in preparation for the summer season she and Mr Molloy were involved in a process of identifying measures that could be implemented to increase revenue and reduce the company's costs and also reviewed the pricing structure. A number of initiatives were introduced as a consequence including some price reductions engagement of new caterer’s, reduction in advertising costs, review of banking fees, and so forth.
[13] Ms Williams explained that a government initiated ban on recreational fishing for the two months 15 October to 15 December 2009 was announced on 2 July 2009. This ban was expected by Mills Charters to have a significant negative impact on their business during one of their traditionally busiest periods of the year.
[14] Ms Williams gave evidence that as Mr McDade had explained on 16 July 2009 she advised him that his full-time position was being made redundant due to the financial position of Mills Charters and that the redundancy would take effect in four weeks.
[15] Ms Williams agrees that Mr McDade asked that Mr Molloy contact him about this.
[16] Her evidence was that whilst his position would be made redundant he could choose to be part of the casual pool of skippers and deckhands. Ms Williams says that Mr McDade immediately started making demands regarding getting a guaranteed share of the casual work available and said that if the company could not give him this guarantee that he would be needing to pursue full-time work elsewhere. Ms Williams says at no time did she ever promise Mr McDade a guaranteed share of the casual work and that she explained this was not possible due to the nature of bookings and that all casual crew would be hired depending on the type of booking and the mix of staff that was required.
[17] On 1 August 2009 Ms Williams says that whilst Mr McDade was working he telephoned her. They had a conversation regarding rosters and crewing and Ms Williams evidence was that Mr McDade was throughout this in a volatile mood. Ms McDade says that he threatened not to be available for his roster the following day. Ms Williams also says that Mr McDade told her that a casual role without a guarantee of hours was not acceptable to him and that he needed more permanency in a position and so was applying for full-time positions elsewhere.
[18] Later that day Ms Williams had a conversation with Mr McDade in person and advised him that the company had decided to allow him to take the final two weeks of his notice off on full pay to enable him to seek full-time work elsewhere. Ms Williams says this conversation was amicable at all times however after this Mr McDade requested a letter be typed up regarding this and whilst this was being done he mentioned that he was considering legal action about not having received the correct written notice.
[19] Ms Williams explained in her evidence that the company engaged casual crew on an as needs basis, that they have not offered any casual crew regular work and that the applicant's position has not been replaced by a new skipper role.
[20] The evidence of Mr Molloy reinforced the financial difficulties that Mills Charters was experiencing in the lead up to the decision to make Mr McDade redundant. His evidence was that as part of the review of the operations there was a review of their staffing needs and that out of this, the decision was made to make Mr McDade's position redundant and that in future they would engage skippers as needed on a casual basis. As part of these considerations Mr Molloy says options other than redundancy were considered however there were no other positions available within the associated entities of Mills Charters into which the applicant could be redeployed.
The legislation
[21] The relevant provisions of the Act are considered below.
“s. 396 Initial matters to be considered before merits
FWA 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.”
Was the application made within the period required?
[22] Mr McDade was terminated on 1 August 2009 and this application was lodged on 4 August 2009. The application has been made within the period required in subsection 394 (2) being within 14 days after the dismissal took effect.
Is Mr McDade protected from unfair dismissal?
[23] Section 382 specifies when a person is protected from unfair dismissal as follows:
“s. 382 When a person is protected from unfair dismissal
A person is protected from unfair dismissal at a time if, at that time:
(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and
(b) one or more of the following apply:
(i) a modern award covers the person;
(ii) an enterprise agreement applies to the person in relation to the employment;
(iii) the sum of the person’s annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold.
Note: high income threshold indexed to $108,300 from 1 July 2009”
[24] Mills Charters is, from the evidence, a Small Business Employer and so the minimum employment period applicable is 12 months. Whilst there is some conflict over the actual period of service there is no doubt that Mr McDade has completed a period of employment of at least 12 months. It is not suggested that Mr McDade's annual earnings exceed the higher income threshold.
[25] Consequently I find that Mr McDade is protected from unfair dismissal.
Was the dismissal consistent with the Small Business Fair Dismissal Code?
[26] S.338 states that a person's dismissal was consistent with the Small Business Fair Dismissal Code if
(b) The employer complied with the the Small Business Fair Dismissal Code in relation to the dismissal.
[27] The Small Business Fair Dismissal Code has provisions regarding “Summary Dismissal.” These have no application to the circumstances here as the dismissal is not based on the employees misconduct.
[28] The Small Business Fair Dismissal Code also has provisions dealing with “Other Dismissals.” In this instance, which involves a purported redundancy, the employee was not at risk of being dismissed based on the employees conduct or their capacity to do the job. Consequently these provisions also have no application.
[29] It would seem then that in a case of redundancy the Small Business Fair Dismissal Code does not impose on a Small Business Employer any positive obligations. That being the case the employer has complied with the Small Business Fair Dismissal Code.
[30] Consequently I am satisfied for the purposes of s.385 that the dismissal was consistent with the Small Business Fair Dismissal Code.
Was this a genuine redundancy?
[31] In this case Mills Charters have argued that the dismissal was a case of genuine redundancy.
[32] Section 389 provides the 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.”
[33] The evidence is clear from all witnesses that Mills Charters had decided that they no longer required Mr McDade's job as a full-time skipper to be performed by anyone. This was because of changes in the operational requirements of the enterprise.
[34] There is nothing to suggest that there were any obligations in a modern award or enterprise agreement that applied to Mr McDade's employment regarding consultation over redundancy.
[35] It is the provisions of section 389 (2) that are in dispute here. Mr McDade argues that it was reasonable in all the circumstances for him to have been redeployed within the enterprise. Mills Charters argued that this was not possible.
[36] The simple fact that is clear from all the evidence is that there was no full-time or permanent position to which Mr McDade could be redeployed. The existence of the casual pool of skippers and deckhands was known to Mr McDade. Placing Mr McDade in the casual pool was the only option available to Mills Charters other than what occurred. I accept the evidence of Ms Williams that between 16 July 2009 and 1 August 2009 Mr McDade showed no interest in being included in this casual pool without a guarantee from the company as to his future earnings. It is unsurprising given the company's reasons for making Mr McDade's position redundant that they were unwilling to and would not provide any guarantees to him about future earnings if he was to make himself available in the casual pool.
[37] Mr McDade’s request for guaranteed hours meant it was not reasonable for the employer to be expected to place him in the casual pool. In any event placing Mr McDade in the casual pool, as he says should have occurred, would not be a transfer, it would not be moving him or reassigning him to a different position. Rather it would merely have meant he may be offered work on a casual basis at some time in the future. This would not have been a re-deployment in any event.
[38] Considering the evidence and the arguments of Mr McDade I find that in all the circumstances it was not possible, and even if it was it would not have been reasonable, for Mr McDade to be redeployed within the employer’s enterprise or the enterprise of an associated entity of the employer.
[39] Therefore I am satisfied that within the meaning of s. 389 this dismissal was a case of genuine redundancy.
Conclusion
[40] In summary considering the initial matters under section 396.
[41] I find that:
- the application was made within the period required in subsection 394(2).
- Mr McDade was protected from unfair dismissal.
- the dismissal was consistent with the Small Business Fair Dismissal Code.
- the dismissal was a case of genuine redundancy.
[42] Section 385 defines what is an unfair dismissal as follows:
“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.”
[43] In this case I am satisfied that the dismissal was a case of genuine redundancy. Consequently within the meaning of s. 385 Mr McDade has not been unfairly dismissed.
[44] Consequently this application will be dismissed and an order to that effect will issue in conjunction with this decision.
COMMISSIONER
Appearances:
Mr N McDade
Ms N Williams, Manager, on behalf of Mills Charters
Hearing details:
2009
Perth
October 8
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