Mr Stuart Carling v Anglo Coal (Dawson Services) Pty Ltd

[2014] FWC 5320

[2014] FWC 5320

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

Mr Stuart Carling
v
Anglo Coal (Dawson Services) Pty Ltd
(U2013/14886)

COMMISSIONER CAMBRIDGE SYDNEY, 6 AUGUST 2014

Application for relief from unfair dismissal - jurisdictional objection - ss. 385 and 396 of Fair Work Act 2009 - whether dismissal was a case of genuine redundancy - s.389 meaning of genuine redundancy - elements which constitute genuine redundancy - genuine redundancy established - jurisdictional objection upheld.

[1] This matter involves an application for unfair dismissal remedy made pursuant to section 394 of the Fair Work Act 2009 (the Act). The application was lodged at Brisbane on 25 November 2013. The application was made by Stuart James Carling (the applicant) and the respondent employer is Anglo Coal (Dawson Services) Pty Ltd(the employer).

[2] The application indicated that the date that the applicant’s dismissal took effect was 4 November 2013. However the correct date of the dismissal of the applicant was clarified to be 8 November 2013. Consequently, irrespective of the incorrect date of dismissal nominated in the application, the application was made within the 21 day time limit prescribed by subsection 394 (2) of the Act.

[3] The matter was not resolved at conciliation. The employer raised a jurisdictional objection to the application on the basis that the dismissal was alleged to be a case of genuine redundancy. The matter has proceeded to arbitration before the Fair Work Commission (the Commission) in a Hearing conducted in Brisbane on 12 May 2014.

[4] At the Hearing, the employer was represented by Ms R Taumalolo, who called a total of three witnesses who provided evidence on behalf of the employer. The applicant was unrepresented and provided evidence as the only witness in support of the unfair dismissal claim and against the jurisdictional objection raised by the employer.

[5] The application was the subject of a jurisdictional challenge made by the employer upon the assertion that the applicant’s dismissal was a case of genuine redundancy. Consequently, the employer advanced a jurisdictional challenge to the application relying upon the requirements of subsection 396(d) of the Act which stipulates that the Commission must decide whether the dismissal was a case of genuine redundancy before any consideration of the merits of the application.

Background

[6] The employer operates the Dawson Coal Mine (the Mine), located near the town of Moura at the southern end of the Bowen Basin in central Queensland.

[7] The Mine experienced an operational loss of $86m for the 2013 financial year. The employer undertook a review of the Mine operation which was aimed to improve profitability. As a consequence of this review, in November 2013, the employer made a decision to implement a restructure of the Mine’s operation which involved a reduction of the Mine’s 1500 workforce by about 200 people. 

[8] The applicant was one of five Maintenance Supervisors who were made redundant as part of the restructure of the Mine implemented in November 2013. The restructure resulted in the loss of about 17 staff roles, being positions not covered by industrial Awards or Agreements, together with approximately 180 operator positions. The role performed by the applicant as a Maintenance Supervisor was one of the staff positions which were made redundant.

[9] On 4 November 2013, all staff including the applicant attended a presentation given by the General Manager of the Mine. This presentation included advice to employees about the restructure and the decision to make certain staff and operator positions redundant. Later on 4 November, the applicant attended a meeting with HR personnel and he was advised that he was one of the five Maintenance Supervisors who had been selected for redundancy.

[10] The applicant was provided with a letter dated 4 November 2013, which confirmed the verbal advice of his redundancy and gave information about the process that was to commence regarding identification of any redeployment opportunities. The applicant was provided with a list of job vacancies which covered the entirety of the Australian operations of the employer’s parent Company, the Anglo American group.

[11] Over the following few days, the employer and the applicant discussed a number of potential redeployment opportunities. The employer identified only one position which it believed suited the skills and qualifications held by the applicant. The position was for a diesel fitter and represented something akin to a demotion from the Maintenance Supervisor role performed by the applicant. The alternative diesel fitter position was at a non-residential mine site. The applicant considered the alternative position and rejected it as he considered it to be an unsuitable redeployment option. No other redeployment options were identified.

[12] Consequently, the employer provided the applicant with a letter dated 8 November 2013, which confirmed the termination of his employment on the basis of redundancy and the inability to confirm any redeployment opportunity. The applicant was paid accrued entitlements which, including a redundancy payment, totalled $60,056.14.

The Jurisdictional Objection

[13] Ms Taumalolo who appeared for the employer made oral submissions in support of written material which had been filed. Ms Taumalolo submitted that the applicant did not have standing to make an unfair dismissal claim because his dismissal was a case of genuine redundancy.

[14] Ms Taumalolo referred to s.389 of the Act which provided a definition for the meaning of genuine redundancy. Ms Taumalolo submitted that there were clear operational requirements which underpinned the employer’s decision to make approximately 200 positions, including that performed by the applicant, redundant. Consequently according to the submissions of Ms Taumalolo, the employer no longer required the job performed by the applicant as he was part of the approximately 200 employees made redundant as a consequence of the restructure of the Mine.

[15] Ms Taumalolo also submitted that any consultation requirements of the Black Coal Mining Award had been satisfied and the process that the employer had adopted for advising employees and implementing its decision to restructure the Mine was without fault.

[16] Ms Taumalolo addressed the question of whether subsection 389(2) of the Act, which was concerned with redeployment, had been satisfied. Ms Taumalolo submitted that any redeployment of the applicant had been properly pursued by the employer and the only position identified as suitable had been rejected by the applicant. Further, Ms Taumalolo said that the employer had demonstrated that there were only limited redeployment opportunities available within the Australian business operations of the employer or any associated entity of the employer. Consequently, according to the submissions of Ms Taumalolo, redeployment of the applicant was not a reasonable proposition in the circumstances.

[17] Ms Taumalolo made further submissions which stressed that any complaint about the process for selection of individuals for redundancy was not a factor relevant to any assessment as to whether the dismissal was a case of genuine redundancy. On this point Ms Taumalolo referred to items 1546 to 1553 of the Explanatory Memorandum to the Fair Work Bill 2008.

[18] Ms Taumalolo also made submissions which addressed the prospect that the employer’s jurisdictional objection may be rejected by the Commission. These alternative or secondary submissions examined the factors contained in s.387 of the Act and developed a proposition that even if the dismissal of the applicant did not satisfy the definition of genuine redundancy, it was nevertheless not a dismissal which was unfair.

[19] In summary, Ms Taumalolo submitted that the applicant’s dismissal was a case of genuine redundancy because each of the relevant provisions of s.389 of the Act had been satisfied. Specifically, Ms Taumalolo submitted that the job of the applicant no longer existed because of operational changes, and the employer had complied with its consultation requirements, and it would not have been reasonable in all the circumstances for the applicant to have been redeployed. Consequently, Ms Taumalolo said that the application did not have jurisdiction and therefore the application for relief from unfair dismissal should be dismissed.

The Case Against the Jurisdictional Objection

[20] The applicant submitted that his dismissal did not involve a case of genuine redundancy. The applicant said that his duties “...are still surviving; that means I shouldn’t have been made redundant. There was a workshop that closed, the jobs were made redundant or possibly made redundant. Those people were moved out and put into my position. That’s where I stand. I believe it’s unfair because of that.” 1

[21] The applicant said that the job that he had been performing was continuing to be performed by one of the other Maintenance Supervisors who had not been made redundant but had moved across from a workshop which had been closed. According to the applicant this situation did not satisfy the terminology of subsection 389(1)(a) of the Act.

[22] Consequently,the applicantasked the Commission to dismiss the jurisdictional objection raised by the respondent employer.

Consideration

[23] This Decision has involved the determination of a jurisdictional objection which was advanced by the employer.

[24] Relevantly s.396 of the Act requires that the Commission must decide a number of specified matters before considering the merits of any application made under s.394. In this instance the jurisdictional objection arises from the provisions of subsection 396(d) of the Act. The particular provisions of s.396 of the Act are:

“396 Initial matters to be considered before merits

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) ...

...

(d) whether the dismissal was a case of genuine redundancy.”

The Genuine Redundancy Question

[25] It would seem that a person cannot be unfairly dismissed if the dismissal was a case of genuine redundancy. This appears to be the clear corollary of subsection 385(d) of the Act:

“385 What is an unfair dismissal

A person has been unfairly dismissed if the FWC is satisfied that:

(a) ... and

(d) the dismissal was not a case of genuine redundancy.”

[26] Section 389 of the Act provides for a meaning of genuine redundancy:

“389 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.”

[27] An examination of the provisions of s.389 of the Act identifies three specific elements which, if satisfied in combination, determine whether or not a dismissal was a case of genuine redundancy. Subsection 389(1) contains two affirmative elements, both of which must be established, in order to allow for a finding that a dismissal was a case of genuine redundancy and subsection 389(2) contains one negatory element which, if established, renders the dismissal not to be a case of genuine redundancy.

[28] For convenience I have abbreviated the three elements identified within s.389. The first affirmative element which is extracted from subsection 389(1)(a) has been described as “job lost due to operational requirements”, the second affirmative element extracted from subsection 389(1)(b) has been called “consultation obligations”, and the third negatory element found in subsection 389(2) is abbreviated as “reasonable redeployment”.

[29] Consequently, my approach to consideration of the question of whether a dismissal was a case of genuine redundancy has involved examination of the three separate elements contained in s.389 of the Act, such that, each of these three separate elements must, in combination, be satisfied in order to make any finding of genuine redundancy. This means that the two affirmative elements contained in subsection (1) must be established and the negatory element found in subsection (2) must not be present in order to make a finding that a particular dismissal was a case of genuine redundancy.

Job Lost Due To Operational Requirements

[30] In this instance, the evidence has established that the applicant was one of a total of approximately 200 employees dismissed on the basis of alleged redundancy. The decision by the employer to dismiss these employees was directly connected with the restructure implemented to redress the unprofitable position of the Mine.

[31] The evidence established that in the case of Maintenance Supervisors such as the applicant, some of the work that had been performed by those who had been made redundant was redistributed or reassigned amongst the remaining employees. The redistribution or reassignment of work amongst retained employees does not alter the fact that a job as opposed to the work of an individual was no longer required. In this case five Maintenance Supervisor jobs were no longer required.

[32] Consequently, the first element of s.389 of the Act has been established, that is, the employer no longer required the job of the applicant as a Maintenance Supervisor (and four others), to be performed by anyone because of changes in the operational requirements of the employer's enterprise.

Consultation Obligations

[33] The second element contained in s.389 of the Act requires a positive finding that the employer had complied with any Award or Agreement obligations to consult about the redundancy.

[34] Although the employer submitted that it had complied with the consultation obligations of the Black Coal Mining Award it was questionable as to whether this Award covered or applied to the work of the applicant. The evidence established that the applicant was employed under a contract which operated for staff as opposed to operational employees at the Mine.

[35] The applicant made complaint about an alleged absence of consultation regarding the basis upon which the employer selected the five individual Maintenance Supervisors who were made redundant. The selection process which is used in order to determine the particular individuals who are to become redundant is not a relevant consideration in respect to the genuine redundancy question; see for example, the Decision of Simpson C in Klavs v Prestige Painters 2. (Of course any selection process could not involve the adoption of some aspect which breached a general protection.)

[36] In any event, I have formed the view that the employer adopted a process to implement its operational restructure which broadly complied with the consultation obligations arising from the provisions of the Black Coal Mining Award, if such provisions were applicable to the applicant. Consequently, I find that the consultation obligations have been met and this element of s.389 of the Act has been satisfied.

Reasonable Redeployment

[37] The third element of s.389 of the Act is the negatory provision contained in subsection 389(2). This element renders what may have been a genuine redundancy, which possessed the elements of subsection 389(1), to not be a case of genuine redundancy if redeployment was reasonable in all the circumstances. Redeployment is contemplated to extend to any associated entities of the employer.

[38] The first and second affirmative elements extracted from subsection 389(1) broadly involve an examination of the conduct of the employer, essentially what gave rise to the dismissal and whether there was compliance with any relevant consultation obligations. The third element concerning reasonable redeployment involves examination of both the employer’s actions and those of individual employees. The reasonableness or otherwise of any redeployment is a matter that would need to be assessed on a case by case basis having regard for the approach to redeployment adopted by both the employer and the employee.

[39] Consequently, the consideration of the reasonable redeployment element of s.389 of the Act has involved an examination of the actions which the employer undertook in the pursuit of redeployment both in general application and for individual employees, and it has also involved careful scrutiny of the conduct and approach to redeployment demonstrated by the applicant.

[40] The significance attached to redeployment as an alternative to any dismissal based upon alleged redundancy is plain from the terms of subsection 389(2) of the Act. Further, it would seem that in broad terms, redeployment would usually involve common benefit for both the employer and employee. Therefore, despite any legislative requirements, it would seem to be just good business management to properly exhaust all reasonable redeployment options before implementing any dismissal for redundancy. Of course it is conceivable that the pursuit of redeployment may be influenced by other factors and redundancy may represent a convenient means to dismiss a particular “undesirable” person as part of a group of redundancies. An examination of the pursuit of redeployment on a case by case basis may expose conduct on the part of either the employer or an employee which may not be genuine and thus provide basis to determine whether, in all the circumstances, it would have been reasonable to redeploy.

[41] The approach to redeployment adopted by the employer involved, inter alia, the provision to the applicant of vacancy and recruitment lists 3 which covered the entire Australian operations of the employer’s parent Company. The applicant was invited to identify any positions which he might consider as potential redeployment prospects. Subsequent discussion between the applicant and relevant management personnel then followed.

[42] Unfortunately, the applicant rejected the only position which appeared to represent a practicable redeployment opportunity. The rejection of this prospect by the applicant was quite understandable as it involved a lower paid, non-supervisory role at a drive in, drive out site. These aspects of the alternative position were not acceptable to the applicant.

[43] In all the circumstances I believe that no criticism can be made of the approach to redeployment adopted by either the employer or the applicant. The circumstances were such that no reasonable redeployment could be arranged despite the genuine attempts made by both the employer and employee.

[44] Consequently, the requirements which have been established to arise from subsection 389(2) of the Act, and as confirmed in the Full Bench Decision in Ulan Coal Mines v Honeysett and Ors 4, have been satisfied.

Conclusion

[45] This Decision has been made in respect to a jurisdictional objection raised by the employer respondent to an application for unfair dismissal remedy. The jurisdictional objection has been advanced on the basis that the dismissal was a case of genuine redundancy and therefore, by operation of subsection 385(d) of the Act, without standing.

[46] The determination of the jurisdictional objection has focused upon the meaning of genuine redundancy as contained in s.389 of the Act. Section 389 of the Act contains 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.

[47] Upon analysis I have determined that the first two affirmative elements were satisfied and in respect to the negatory element contained in subsection 389(2) which deals with reasonable redeployment, I have determined that in all the circumstances the negatory element in subsection 389(2) was not established and therefore the dismissal of the applicant was a case of genuine redundancy.

[48] In view of the finding made as to genuine redundancy, the jurisdictional objection of the employer is upheld. The application for unfair dismissal remedy is jurisdictionally barred and must therefore be dismissed. An appropriate Order [PR553956] will be issued accordingly.

COMMISSIONER

Appearances:

Mr S Carling, appearing unrepresented.

Ms R Taumalolo, appeared on behalf of the employer.

Hearing details:

2014.
Brisbane:
May 12.

 1   Transcript of proceedings (12/05/14) @ PN785.

 2   Ms Felicity Klavs v Prestige Painters [2013] FWC 2485.

 3   Exhibits 5 and 6.

 4   Ulan Coal Mines Limited v A. Honeysett and Ors and R. Murray and Ors v Ulan Coal Mines Limited [2010] FWAFB 7578.

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