Mrs Julie Eldered v Spotless Management Services Pty Ltd

[2015] FWC 4180

[2015] FWC 4180

FAIR WORK COMMISSION

DECISION

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

Mrs Julie Eldered
v
Spotless Management Services Pty Ltd
(U2014/15979)

SENIOR DEPUTY PRESIDENT RICHARDS BRISBANE, 24 JUNE 2015

Summary: application for an unfair dismissal remedy under s.394 - jurisdictional objection under s.389 - employer obligations to consult under modern award and redeployment opportunities - consideration under s.387 - whether dismissal harsh, unjust or unreasonable - application under s.394 dismissed

[1] This decision concerns an application by Mrs Julie Ann Eldered under s.394 of the Fair Work Act 2009 (“the Act”) by which she seeks an unfair dismissal remedy in respect of her termination by Spotless Management Services Pty Ltd (“the employer”) on 30 November 2014. The employer carries out contracted integrated facility management services.

[2] Mrs Eldered claims that on 2 September 2014 all of the employer’s employees employed for the purposes of the current contract with the Department of Defence were advised in the following terms (in summary):

• The current contract between the employer and the Department of Defence for the provision of services will cease on 30 November 2014;



• The employer has been awarded a new contract in respect of the estate maintenance and operation services (EMOS) for Defence which would commence on 1 December 2014;



• Owing to the changes in the scope and type of services provided to the Department of Defence within the EMOS contract there will be changes in the skill requirements needed by the employer;



• Current employees will be required to participate in the recruitment and assessment process and will have the opportunity to apply for roles within the EMOS contract;



• This was the only way to ensure that an objective process that provided equal opportunity for all employees to demonstrate their relevant skills could be given effect;



• In the event an employee was unsuccessful in securing a role under the new contract the employer undertook to work closely with the employee to identify a new opportunity to transfer to another position within the business;



• Employees will be provided with a vacancy list of all current available roles within the Spotless Group, and employees can signal their interest to their employer in any of these vacancies; and



• It will only be in the event that the employer cannot obtain acceptable alternative employment for employees either within the new EMOS contract or within the Spotless Group that redundancies will take effect.

[3] Mrs Eldered was not offered a new position within the EMOS contract. Mrs Eldered’s employment was terminated as a consequence of her position having been made redundant.

[4] There is some necessary background to Mrs Eldered’s application, which I will set out as follows.

[5] Mrs Eldered initially was employed in a call centre operated by the employer on 21 October 2011. She found this role not to her satisfaction, believed herself not to have been fully trained in call centre functions and she claims that she was exposed to bullying and decision making by managers that was based on favouritism. Mrs Eldered complained of seeing a manager taking smoko breaks with her best friend, an employee who did not smoke, and that the environment was “clicky”. Mrs Eldered stated that formal training did eventually commence but it commenced at the time she was contemplating another position (see immediately below). Mrs Eldered claimed that she had complained to the call centre manager about the environment and the manager had been apologetic, but that the conduct had continued.

[6] Mrs Eldered eventually accepted a planning position with the employer, under the Defence contract referred to above, and left the call centre. Her formal role was as a Data Administrator, and she commenced her duties in this respect on 28 March 2012.

[7] In the latter half of 2014, as a preliminary step in explaining the changes in the contracts, the employer conducted presentations to its staff. Mrs Eldered complains that she missed some of her employer’s presentation on the implications of the loss of the Defence contract (though she is uncertain how much), owing to difficulties in locating a disabled parking spot.

[8] Mrs Eldered also complains as a corollary that there was no meaningful consultation with her (due to the HR Manager, Ms Susan Lillehagen, being “rarely available”) and that two positions that were offered to her - in the call centre and a payroll support roll - were either withdrawn or inappropriate for her circumstances.

[9] Mrs Eldered appears on her evidence to have had discussions with a manager (Mr Steve Maraze) on 7 October 2014 and to have expressed her concerns about her prior call centre experiences and the amount of information available as to which employees would be transferred into roles under the new contract, but was “yelled at” by Mr Maraze.

[10] Mrs Eldered complains that she did apply for some five other jobs within the Spotless Group but this was a pointless exercise as other employees had been nominated for those positions and she was not a genuine contender in any event.

[11] Mrs Eldered also gave evidence in her written statement that she had informed Ms Lillehagen that she could not take the call centre role:

“I told Ms Lillehagen that I could not go back to call centre and be treated in the way I had been, I had warned her of big issues in there.”

[12] Mrs Eldered also claimed she informed Mr Warwick Pollock (Manager, Estate Management and Operations) that she had “reservations about going back to a call centre [given what she had] experienced before and having the additional threat of Steve [Maraze] having [her] as a target [was] unnerving.”

[13] However, Mrs Eldered elsewhere in her statements indicated that she had informed Mr Pollock that she would take the call centre position. In the end, however, Mrs Eldered claimed that the call centre position was withdrawn for consideration on the basis that Mr Pollock had a view that the role was “beneath [her]” and therefore withdrew the offer.

[14] Mrs Eldered also states that a payroll support position was suggested but that this was not a genuine offer as the position/s had been allocated to other employees without interview.

[15] In any event, Mrs Eldered argued in the materials that the payroll position was impractical for her, for a number of reasons. This included having to drive 40 minutes or longer to work in peak traffic, the possible exposure to toll roads, and it being unreasonable for a person with a disability to walk sometimes lengthy distances between different modes of transport (such as a bus changeover or a bus-train transition).

[16] Mrs Eldered did not lead any medical evidence about the scope or nature of her disability, though it was accepted that she was provided with access to a disabled car park in her prior role under the Department of Defence contract. I am not able to articulate the precise nature of Mrs Eldered’s disability, but it is apparent that it affected her mobility.

[17] In any event, Mrs Eldered was also of the view that she was not offered the payroll position on a genuine basis:

“[...] the only reason it was being offered was that the person chosen declined it at the last minute after being trained in it interstate.”

[18] Mrs Eldered also claimed that there was a position in quality compliance, but this was withdrawn before such time as she could express interest.

[19] It was, according to Mrs Eldered, a pattern of discriminatory conduct in evidence and she felt as though she was being bullied, harassed and deceived by her employer.

[20] The employer contends - through the evidence of Mr Pollock - that owing to the loss of the contract between itself and the Department of Defence the employer was obliged to make operational changes in the composition of its workforce.

[21] The contract the employer had held with Defence required it to deliver a very wide range of services to the Department across some four different sites. It had held the contract since August 2004.

[22] As a result of a tender process, the employer was informed by the Department on 8 May 2014 that it was unsuccessful in maintaining some of the services which it had performed under the original contract, and that the contract would come to an end on 30 November 2014. As mentioned above, a new contract (for the provision of a more narrow range of services) was entered into subsequent to that date with the Department of Defence.

[23] The new contract did not include a position for the role performed by Mrs Eldered under the original contract. That is, there was no administrative position that was required to update and maintain equipment spatial data in a Defence database known as the Defence Estate Management System (DEMS). Indeed, according to Mr Pollock the Department of Defence had ceased to use the DEMS altogether and there was no requirement for manual uploading of file data to a new system.

[24] Mr Pollock explained that at that time Mrs Eldered’s position was made redundant it was uncertain if the Department would require any data entry support roles for transitional purposes. Defence had not approved any such roles by 30 November 2014, the date on which the contract ceased and Mrs Eldered’s employment was terminated.

[25] Mr Pollock explained that not all positions under the current contract could be included in the new contract and that new positions under the new contract did not align necessarily with the positions under the current contract. As a result, employees were invited to apply for positions as a means of determining the appropriateness of an appointment to each of the vacant positions in the new contract. Mr Pollock explained further that these circumstances were conveyed to staff at meetings of 18 August and 20 August 2014. A document was provided to all staff explaining the recruitment process.

[26] Mr Pollock indicated through his evidence that he met with Mrs Eldered on 25 September 2014, and she expressed her concern that she could not see her then current position in the list of the advertised positions under the new contract. Mr Pollock contended that he attempted to explain to Mrs Eldered that the reasons for this were outlined at the meeting of 18 August 2014 and in the documentation distributed at that time (and as summarised immediately above).

[27] Mr Pollock also indicated that the Department of Defence might at some point approve data entry position/s but at that time there was no firm indication one way or another of its final disposition in this respect. That is, there was no position available at the time (in the new contract) of the kind currently held by Mrs Eldered.

[28] Mr Pollock claims that he subsequently brought to the attention of Mrs Eldered other available positions which might have been of interest to her. One of these positions was in the call centre and was similar to the role she had held previously with the employer. The call centre position was located at Enoggera and was some 18km/25 minutes travel from Mrs Eldered’s residence.

[29] Mrs Eldered was said by Mr Pollock to have “expressed displeasure” with the option of redeployment to the call centre role. Mr Pollock advised Mrs Eldered to give consideration to the option, nonetheless. He explained that her direct report was now another person with whom Mrs Eldered might have had a more cordial relationship (than the person she reported to previously in the call centre).

[30] Mr Pollock also claimed that he indicated to Mrs Eldered that she should review the daily vacancy list which set out the current vacancies in the whole of the employer’s business (that is the whole of the Spotless Group). Mr Pollock indicated to Mrs Eldered that a copy of this vacancy list was placed on the HR noticeboard in the staff lunch room. Mr Pollock also claimed that Mr Geoff Kilpatrick, Mrs Eldered’s direct supervisor, had discussed the vacancies in the business with her personally.

[31] Mr Pollock claimed that Mrs Eldered expressed no interest in the alternative positions but merely indicated a desire to retain her current role.

[32] In early October 2014, Mr Pollock claims he again met with Mrs Eldered to discuss her employment options. Mrs Eldered agitated the issue as to whether or not the data entry role would be included in the new contract. Mr Pollock indicated that this was not to be the case and there was no position available to her under the new contract. Mr Pollock claimed he then again offered the position in the call centre to Mrs Eldered.

[33] On 13 October 2014, Mr Pollock again met with Mrs Eldered to determine whether or not she had made a decision about the call centre position. Mrs Eldered was said to have advised Mr Pollock that she was declining the role, stating it was a backward step and was not sufficiently similar to her current data entry role.

[34] Mr Pollock indicated that he informed Mrs Eldered that there was another position in payroll support at Murarrie. The location of that position appears to be some 31km/40 minutes travel from Mrs Eldered’s residence. Mr Pollock claimed that he indicated to Mrs Eldered that he would have the HR manager Ms Lillehagen, speak with her about the position.

[35] According to Mr Pollock, Mrs Eldered expressed the view to him that if nothing similar to her current role was available prior to the end of the existing contract then she would be entitled to severance pay.

[36] Mr Pollock understood from Ms Lillehagen that Mrs Eldered had declined the payroll position on grounds of unwillingness to travel to Murarrie. Mrs Eldered’s own evidence supports this in so far as she (Mrs Eldered) set out in detail a conversation she had with Ms Lillehagen about her reluctance to accept the Murarrie position.

[37] Mr Pollock confirmed Mrs Eldered’s claim that she had indeed applied for some five other positions in the new Department of Defence contract, however she was unsuccessful in each instance. Mr Pollock explained this on the basis that the positions were filled by persons who performed the same roles under the existing contract, and that no external candidates were engaged under the new contract. That is, incumbent employees had been redeployed in effect to the like positions under the new contract.

[38] The employer contends that Mrs Eldered refused offers of redeployment as a call centre operator and as a payroll officer. Mrs Eldered’s employment was terminated on 30 November 2014 as a result.

Jurisdictional objection

[39] The employer contends that in effecting Mrs Eldered’s dismissal it acted in accordance with s.389 of the Act.

[40] Section 389 of the Act provides as follows:

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.

[41] The work carried out by Mrs Eldered was covered by the Clerks – Private Sector Award 2010 (“the modern award”). The modern award provides relevantly as follows (in relation to consultation requirements in respect of major workplace change):

8.1 Consultation regarding major workplace change

(a) Employer to notify

(i) Where an employer has made a definite decision to introduce major changes in production, program, organisation, structure or technology that are likely to have significant effects on employees, the employer must notify the employees who may be affected by the proposed changes and their representatives, if any.

(ii) Significant effects include termination of employment; major changes in the composition, operation or size of the employer’s workforce or in the skills required; the elimination or diminution of job opportunities, promotion opportunities or job tenure; the alteration of hours of work; the need for retraining or transfer of employees to other work or locations; and the restructuring of jobs. Provided that where this award makes provision for alteration of any of these matters an alteration is deemed not to have significant effect.

(b) Employer to discuss change

(i) The employer must discuss with the employees affected and their representatives, if any, the introduction of the changes referred to in clause 8.1(a), the effects the changes are likely to have on employees and measures to avert or mitigate the adverse effects of such changes on employees and must give prompt consideration to matters raised by the employees and/or their representatives in relation to the changes.

(ii) The discussions must commence as early as practicable after a definite decision has been made by the employer to make the changes referred to in clause 8.1(a).

(iii) For the purposes of such discussion, the employer must provide in writing to the employees concerned and their representatives, if any, all relevant information about the changes including the nature of the changes proposed, the expected effects of the changes on employees and any other matters likely to affect employees provided that no employer is required to disclose confidential information the disclosure of which would be contrary to the employer’s interests.

Whether genuine redundancy

[42] For the purposes of s.389(1)(a) of the Act, Mrs Eldered’s employer no longer required her job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise.

[43] The operational changes brought about by the loss of the (previous) contract with the Department of Defence meant that Mrs Eldered’s data entry function was not required at the time of the cessation of the contract on 30 November 2014.

[44] There is no contest in this matter as to the authentic nature of the operational change that arose from the tender process conducted in May 2014.

[45] For purposes of s.389(1)(b) of the Act, it appears to me on the basis of Mr Pollock’s evidence, which was given candidly and professionally, that the employer went about managing the consequences of the change in operational circumstances in terms that were consistent with its obligation to consult under the modern award.

[46] I have set out the steps above as disclosed through Mr Pollock’s evidence as to how the employer discussed the changes with the affected employees and set about attempting to mitigate the effects of the changes. That evidence is not seriously challenged. The employer addressed staff on two dates in August 2014 and provided extensive written materials in support of those presentations. Correspondence was dispatched to staff in early September 2014 and meetings were held in person with Mrs Eldered about her circumstances.

[47] The employer set about informing staff of the changes to the contract as soon as it was able to do so - which was around August 2014. Mr Pollock’s evidence was that this was the earliest occasion on which staff could be informed of the major change because the employer had been embargoed by its client from making any statement before this time. Once staff had been informed, the major change did not take effect until 30 November 2014.

[48] Given the employer’s evidence, I am unable to discern any departure from the consultation provisions of the modern award.

[49] For the purposes of s.389(2) of the Act, Mrs Eldered was provided two concrete options for redeployment.

[50] Mrs Eldered claims, as I set out above, that the call centre option was withdrawn by Mr Pollock despite her having indicated to Mr Pollock that she wished to accept the position (despite her apprehensions about her prior experience). I do not find that Mrs Eldered’s claims in this regard are credible. The evidence was internally contradictory as to her position in respect of the call centre role.

[51] Specifically, Mrs Eldered contended that she had a discussion with Ms Lillehagen - the HR Manager - on her last day of work. Mrs Eldered claimed that in that conversation she complained (expressed “disillusionment and dismay”) that jobs were offered which had been filled by other employees and the manner of advertising jobs had been false or misleading. Mrs Eldered went on to say that:

“I told Ms Lillehagan that I knew that Spotless had applied to vary the redundancies. I said it was deceitful not to be telling anyone but after what had been happening to me I was not surprised. Ms Lillehagan said that it was not the legitimate cases that they were trying not to pay it was those who walked out of the jobs with Spotless in the old contract on the 28 November 2014 and into jobs with a new contractor on the 1 December 2014. I said that they should pay the legitimate ones then but I saw it as they were trying not to pay anyone.

I told Ms Lillehagan that I could not go back to the call centre and be treated in the way I had been, I had and warned her of big issues in there. I said I also could not work under Mr Maraze and the fear of his threats.

We discussed my issues with the payroll job at Murarrie and the fact that due to my disability I could not drive that far particularly in peak hour traffic any more, nor do the public transport thing it was too far about averaging about 1.5 to 2 hours each way and consisting of too many modes of transport complicating my disability to get to each day. I also expressed concern with the additional factor of the tolls. And the fact that the only reason it was being offered was that the person chosen declined it at the last minute after being trained in it interstate.” (sic)

[52] The conversation with Ms Lillehagan appeared to traverse a range of matters. Mrs Eldered said the discussion had just been a very short discussion but then claimed that she may have been exaggerating in that respect.

[53] Having set out the detail of the discussion with Ms Lillehagen, Mrs Eldered makes no reference therein to her claim made in these proceedings that Mr Pollock had withdrawn an offer for a position in the call centre when she had indicated that she was willing to accept such a position.

[54] If Mrs Eldered had expressed her “disillusionment and dismay” about her employer’s handling of the redundancy process it would be reasonable to expect that she would have included in that discussion reference to Mr Pollock having withdrawn an offer of employment against her express wishes.

[55] Mrs Eldered’s only reference to the call centre on her final day of work was to explain to Ms Lillehagen that she could not go back to the centre. Reasonably, had Mr Pollock refused to allow her to accept the position (or had he withdrawn the offer for the reasons that Mrs Eldered asserted) that conduct would have been front and centre in a conversation with Ms Lillehegen. But it was not. And the only reference to the call centre is Mrs Eldered’s statement that she did not wish to return there given her prior experiences.

[56] Having heard the evidence, it is most unlikely that Mrs Eldered would have overlooked in her conversation with the HR Manager a matter of such significant importance in respect of her apparent disillusionment and dismay.

[57] On the balance of probability, I find that Mrs Eldered did not raise the concern about Mr Pollock’s alleged withdrawal of the call centre position for the reason that Mr Pollock never did withdraw the call centre position. I prefer Mr Pollock’s reconstruction of the conversation with Mrs Eldered.

[58] It follows, therefore, that Mrs Eldered was offered a position in the call centre at Enogerra, but declined to accept the position (for her own reasons).

[59] I add to this that Mr Pollock gave evidence at the hearing that the call centre position was still available and should Mrs Eldered wish to be employed in the call centre position she could be so employed. Mrs Eldered did not take up the offer (as she explained she had secured employment elsewhere).

[60] The employer considered that it was reasonable in the circumstances to seek to redeploy Mrs Eldered to the positions - the call centre position in Enogerra and the payroll officer position in Murarrie. But Mrs Eldered for her own reasons was unwilling to take up these redeployment opportunities.

[61] Mrs Eldered demonstrated no interest in any other positions in the wider Spotless Group and was unsuccessful in obtaining any position under the new contract (for the reasons set out in Mr Pollock’s evidence).

[62] In making the call centre and payroll officer positions available to Mrs Eldered the employer demonstrably discharged its obligations under s.389(2) of the Act (and this is particularly so in respect of the call centre position).

Conclusion

[63] On the basis of the evidence before me the employer has acted consistently with the requirements of s.389 of the Act.

[64] The application by Mrs Eldered under s.394 of the Act therefore cannot proceed as it is jurisdictionally incompetent and must be dismissed as a consequence.

[65] In the event I am wrong in relation to any of the findings above, and the substantive application is not set aside because of the jurisdictional objection under s.389 of the Act, I now turn to consider the substantive application under s.394 of the Act.

Legislative context

[66] Section 387 of the Act sets out the criteria for considering whether a dismissal was harsh, unjust or unreasonable. Section 387 is as follows:

387 Criteria for considering harshness etc.

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:

(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and

(b) whether the person was notified of that; and

(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and

(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal; and

(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(h) any other matters that the FWC considers relevant.

Consideration

Whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees)

[67] The Full Bench in UES (Intl) Pty LtdvLeevan Harvey[2012] FWAFB 5241 indicated that a dismissal for operational reasons was not a dismissal related to an employee’s capacity or conduct.

[68] I found above that the decision to bring about the dismissal of Mrs Eldered was because of an operational reason arising from the loss the Department of Defence contract. This is not a matter relevant to s.387(a) of the Act. As a consequence, the circumstances bear in neutral terms upon the ultimate finding as to whether or not Mrs Eldered was dismissed harshly, unjustly or unreasonably.

Whether the person was notified of that reason

[69] Given the circumstances referred to immediately above, Mrs Eldered cannot be said to have been notified of the reason in respect of her capacity or conduct. Again, because Mrs Eldered was dismissed because of an operational reason, the absence of notification in the terms of s.387(b) of the Act is a neutral consideration for purposes of my ultimate finding.

Whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person

[70] Once more, for the reasons referred to immediately above, the failure to be notified of the “reason” for the dismissal (which is a reason for the purposes of s.387(a) of the Act) is a neutral consideration as to whether or not the dismissal was harsh, unjust or unreasonable. This is because there is no valid reason for the dismissal as the dismissal was for reasons unrelated to Mrs Eldered’s capacity or conduct.

Any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal

[71] The Company did not unreasonably refuse to allow Mrs Eldered to have a support person present to assist in any discussions relating to dismissal. This is a neutral matter in respect of whether or not the dismissal was harsh, unjust or unreasonable.

If the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal

[72] This is a neutral matter in respect of whether or not the dismissal was harsh, unjust or unreasonable, given the circumstances referred to above.

The degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal, and

The degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal

[73] Neither the size of the Company’s enterprise nor the absence of dedicated human resource expertise were relevant considerations in respect of the procedures adopted in effecting the dismissal. I regard these matters to be neutral in respect of the ultimate consideration as to whether or not the dismissal was harsh, unjust or unreasonable.

Any other matters that the FWC considers relevant

[74] I have found earlier that I consider the reason for Mrs Eldered’s dismissal to have been because of an operational reason, arising from the loss the Department of Defence contract. Mrs Eldered was offered other positions with the Company, but for the reasons I have set out above in relation to my jurisdictional decision, Mrs Eldered did not wish, for reason of her personal circumstances, to avail herself of those opportunities.

[75] In all, the employer’s reasons for the dismissal of Mrs Eldered were sound, defensible and well founded.

[76] Mrs Eldered was provided with a reasonable process of consultation in that her views were sought out as to her preferences for future employment should such opportunities be available to her. The employer interacted with Mrs Eldered over a very lengthy period of time in respect of the implications for her as a result of the loss of the Defence contract. Mrs Eldered was not treated unfairly in any broad sense.

Conclusion

[77] Mrs Eldered was dismissed for operational reasons and these reasons were sound, defensible and well founded. There are no other matters to which any weight of any significance should be placed that would disturb a finding other than that Mrs Eldered was not dismissed for reasons that were harsh, unjust or unreasonable.

[78] In light of these findings, Mrs Eldered’s application under s.394 of the Act, to the extent it survived any objection under s.389 of the Act, is therefore dismissed.

SENIOR DEPUTY PRESIDENT

Appearances:

Mrs J. Eldered, Applicant

Mr J. Douglas, of the Respondent

Hearing details:

Brisbane

2015

17 June

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