Mrs Julieanne Cuthbertson

[2013] FWC 2644

[2013] FWC 2644

FAIR WORK COMMISSION

DECISION

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

Mrs Julieanne Cuthbertson
(U2012/9973)

Mr Tony Harris
(U2012/10113)
v
Roper Gulf Shire Council

DEPUTY PRESIDENT ASBURY BRISBANE, 30 APRIL 2013

Application for unfair dismissal remedy - extension of time.

Introduction

[1] This decision concerns applications under s.394 of the Fair Work Act 2009 (the Act) for unfair dismissal remedies, made by Mrs Julieanne Cuthbertson and Mr Tony Harris (the Applicants) in relation to their respective dismissals by Roper Gulf Shire Council (the Council). Each of the applications was made outside of the time required in s.394(2) of the Act and Ms Cuthbertson and Mr Roper seek an extension of time in which to make their applications.

[2] The dismissals of Mrs Cuthbertson and Mr Harris took effect on 16 March 2012. Section 294(2) of the Act as it then applied, required the applications to be made within fourteen days of that date. Mrs Cuthbertson’s application for an unfair dismissal remedy was made on 15 October 2012, some 212 days outside the required time and Mr Harris made his application on 29 October 2012, some 226 days outside the required time.

[3] Directions were issued requiring the Applicants to file and serve outlines of submissions and any witness statements, in relation to why an additional period of time should be allowed for their applications to be made. A single submission in relation to both applications was received. A Submission was also received from the Council. No witness statements were filed by any party, and accordingly this decision is made on the basis of the material on the file.

Legislation

[4] As previously stated, at the time the applications were made, s.394(2)(a) established a time limit of fourteen days from the date the dismissals took effect or such further period as the Commission allows. By virtue of s.394(3) of the Act, the Commission may allow a further period for an application under s.365 to be made, if the Commission is satisfied that there are exceptional circumstances, taking into account:

(a) the reason for the delay; and
(b) whether the person first became aware of the dismissal after it took effect; and
(c) any action taken to dispute the dismissal; and
(d) prejudice to the employer (including prejudice caused by the delay); and
(e) the merits of the application; and
(f) fairness between the person and other persons in a like position.

[5] The discretion to extend time in s.366(2) is predicated on the Commission being satisfied that there are exceptional circumstances, taking into account the specified matters. In Nulty v Blue Star Group Pty Ltd 1 a Full Bench of the Commission noted that the expression “exceptional circumstances” has its ordinary meaning, and requires consideration of all the circumstances, going on to say:

“To be exceptional, circumstances must be out of the ordinary course, or unusual, or special, or uncommon but need not be unique, or unprecedented, or very rare. Circumstances will not be exceptional if they are regularly, or routinely, or normally encountered. Exceptional circumstances can include a single exceptional matter, a combination of exceptional factors or a combination of ordinary factors which, although individually of no particular significance, when taken together are seen as exceptional. It is not correct to construe “exceptional circumstances” as being only some unexpected occurrence, although frequently it will be. Nor is it correct to construe the plural “circumstances” as if it were only a singular occurrence, even though it can be a one off situation. The ordinary and natural meaning of “exceptional circumstances” includes a combination of factors which, when viewed together, may reasonably be seen as producing a situation which is out of the ordinary course, unusual, special or uncommon”. 2

The facts

[6] The facts can be briefly stated. Mrs Cuthbertson commenced employment with the Council on 20 October 2008 in the role of Assistant Regional Manager Housing, and was promoted to the position of Regional Manager Housing on 27 September 2010. Mr Harris was employed from 18 November 2008 in the role of Administration Co-ordinator, and was promoted to the position of Assistant Regional Manger Housing on 11 April 2011.

[7] Mrs Cuthbertson was employed on a weekly full time basis and Mr Harris was employed on a fixed term contract of employment for a period of two years expiring on 13 March 2013, unless terminated earlier as provided in the contract. That contract, appended to Mr Harris’ application, contained a provision enabling the contract to be terminated prior to the termination date, for any reason, on a date specified by the Chief Executive Officer by the giving of six months written notice or payment in lieu of salary, at the discretion of the Chief Executive Officer.

[8] In or around October 2011, the Council’s Finance Manager raised the issue of a financial deficit with the Applicants and other employees in its Housing Operations. A number of reports and financial statements were prepared and a review of a housing maintenance contract between the Council and the Northern Territory Government Department of Housing was foreshadowed. On 28 October 2011 a meeting with the Applicants and other employees of the Council took place at which these issues were discussed.

[9] Following further investigation, a decision was taken to discontinue the Housing and Repairs Contract from 16 March 2012 and employees were informed of this decision on 18 January 2012, on the basis that it would have significant effects and lead to positions being made redundant. On 30 January 2012, letters were sent to Mrs Cuthbertson and Mr Harris advising that the Council would no longer be conducting housing maintenance using Council employed staff due to the cancellation of the services contract with Territory Housing, and that each of their positions was to be made redundant.

[10] Mrs Cuthbertson was informed that with effect from 16 March 2012, her position would be made redundant and that she was entitled to seven weeks redundancy payment. Mr Harris was informed that his position was redundant and that the Chief Executive Officer had elected, pursuant to his contract of employment, to provide him with 6 months notice that his employment contract would end on 30 July 2012. Mr Harris was further informed that the Council expected that he would remain in his role until 18 March 2012 and that after that date, Council would make payment in lieu of salary for the rest of the notice period which would also meet its obligation with respect to redundancy pay.

[11] Various attempts to redeploy affected staff were made but for various reasons these were not successful with respect to Mrs Cuthbertson and Mr Harris. In or around February 2012, the Council agreed to continue to deliver the housing contract until 17 August 2012 under a significantly revised model. Both Mrs Cuthbertson and Mr Harris were informed by letter that the Council would like to retain their services, albeit with a change to their duties. The Council committed to keeping Mrs Cuthbertson and Mr Harris on the same employment terms and conditions until 17 August 2012 in the case of Mrs Cuthbertson and 30 July 2012 in the case of Mr Harris.

[12] Mrs Cuthbertson was informed that she would be entitled to a redundancy payment if she elected to remain in employment until 17 August 2012 and Mr Harris was informed that the Council would make a redundancy payment to him if he elected to remain employed until 30 July 2012. Mrs Cuthbertson was also offered redeployment to a position of Special Projects Officer with the same terms and conditions of employment. This offer was rejected by Mrs Cuthbertson, and she informed the Council that she intended to accept payment upon her position being made redundant, effective 16 March 2012. Mr Harris forwarded an email to the Council confirming that he would be taking redundancy on 16 March 2012. Both Applicants left employment on that date.

[13] The submissions made on behalf of the Applicants confirmed that advice of redundancy was provided on 18 January 2012, and that there was an offer for them to remain employed until 17 August 2012 which was declined. According to the submission on behalf of the Applicants, the redundancies came as a shock. The Applicants took issue with the accuracy of the reports about the Council’s financial position, and the extent of the debt. The Applicants also took issue with the fact that Housing Department staff were the only staff members held accountable for the financial position of the Department, and said that mistakes of the finance department must have occurred, causing disastrous professional and personal results for Housing Department staff.

Reasons for the delay in making the application

[14] The reason advanced in the submission filed by the Applicants is as follows:

“The reason for the delay in submitting the application (original application sent through to FWA on 15 October 2012) was to see if Roper Gulf Shire Council continued to deliver the Property Management Contract past the date advised to us in our redundancy letter I was offered to stay employed with Roper Gulf Shire Council until 17th August 2012.

To this date Roper Gulf Shire Council continue to deliver on the Service Level Agreement with Territory Housing.”

[15] The Council submits that if the Applicants were waiting to see if the services would continue to be delivered beyond 17 August 2012, then their failure to make their applications until October2012 is not reasonable and this is not an explanation for the delay, which would constitute exceptional circumstances.

[16] The Council also submits that the Applicants’ positions have not existed since 16 March 2012 when they were made redundant, and while a further service agreement has been negotiated with the Territory Housing, it is in the context of a significantly altered business model.

Whether the Applicants first became aware of the dismissals after they took effect

[17] There is no issue about when the Applicants became aware of their dismissals and no evidence that this factor had any relevance to the delay in making their applications. On the facts set out in their submission, the Applicants were advised verbally of their impending redundancies on 18 January 2012, and this was confirmed by letter of 30 January 2012. Mrs Cuthbertson was told that her employment would cease on 16 March 2012. Mr Harris was given six months notice as required by his contract and was told that he would remain in employment until 16 March 2012 and would be paid for the remainder of his notice period (although there appears to be some ambiguity in the letter sent to Mr Harris this is the effect. Further Mr Harris made no complaint about any ambiguity).

Action taken to dispute the dismissal

[18] There is no evidence of any action taken by either of the Applicants to dispute their dismissals before making their applications in October 2012. There is evidence of email correspondence from Mr Harris advising the Council that he would be taking redundancy from 16 March 2012 and seeking confirmation that his notice period up until 30 July 2012 would be paid as a lump sum and also querying the taxation treatment of the amounts paid to him on termination.

[19] There is also evidence that Mrs Cuthbertson chose not to continue employment up until 17 August 2012 and withdrew an expression of interest in an alternative position.

Prejudice to the employer (including prejudice caused by the delay)

[20] The Council submits that it has suffered and stands to suffer considerable prejudice due to the delay of the Applicants in making their unfair dismissal applications, due to the need to locate documents and deterioration in recall of witnesses because of the passing of time.

[21] The Council also submits that it maintained its restructured operations and utilized resources on the basis that the Applicants were genuinely made redundant and would no longer be able to make an unfair dismissal application. It would be unfair and oppressive to allow the Applicants to bring their applications so long after the alleged circumstances that gave rise to them have passed.

The merits of the applications

[22] The Council submits that the Applicants have failed to particularise the reasons why they believe their dismissals were unfair, and that their positions were genuinely redundant. The Council provided organisational charts before and after the redundancies as evidence of the changed business model. Council further pointed to communications from Mr Harris indicating his understanding that his employment was terminated due to redundancy.

[23] The Council stated that if the Commission exercised the discretion to extend time, a further objection would be made by the Council to the applications on the ground that the dismissals were genuine redundancies as provided in s.385(d) of the Act.

Fairness between the Applicants and other persons in a like position

[24] In relation to this factor the Council submits that 13 employees were made redundant at the same time as the Applicants, and that some elected to accept redundancies while others accepted redeployment. These other employees did not make unfair dismissal applications, and it would not be fair to them if extensions of time were granted to the Applicants.

[25] It is also submitted that the intention of establishing a statutory time limit would be subverted if extensions were granted to the Applicants and it would be inconsistent with ensuring that fairness was maintained between the Applicants and other persons in a similar position.

Conclusion

[26] The Applicants have not established that there are exceptional circumstances, such as would trigger the discretion to extend time. The reason advanced by the Applicants for the delay in making the applications does not involve any exceptional circumstance. The Applicants simply chose to wait for a period of time to file their applications. They have not pointed to any event or change in circumstances - much less any exceptional event - between the date that the dismissals took effect and the date the applications were made, such that it was reasonable for them to file their applications after the time in which they were required to be made.

[27] Exceptional circumstances may be established where a person who has been told that their employment has been terminated on the grounds of redundancy, later becomes aware that their position has been filled and that the redundancy is a sham, so that the discretion to extend the time to make an application is triggered. This is not such a case.

[28] The Applicants were aware that their positions were to be made redundant in advance of the date their dismissals took effect, and gave every appearance of accepting that their employment was coming to an end for that reason. They took no action to dispute the dismissals until they filed the applications subject of the present proceedings, significantly outside the required time.

[29] I accept that the Council will be prejudiced by being required to defend the applications, because of the lapse of time between the events that lead to the dismissals and the point at which a hearing would be conducted, particularly in circumstances where the Council has restructured its operations on the basis that the Applicants were made redundant and did not contest their dismissals until well outside the time limit in the Act.

[30] The Council has placed a significant amount of material before the Commission which supports the proposition that the Applicants’ dismissals were genuine redundancies. In contrast, the Applicants have provided no material to rebut this proposition, other than expressing their views that the housing department was being unfairly blamed for financial issues and errors that gave rise to the redundancies.

[31] On the material before the Commission, the Council appears to have a strong argument that the redundancies were genuine. Further, the grounds set out in the unfair dismissal applications subject of these proceedings, are not sufficiently strong, so that the merits of the applications are such that I could be satisfied that there are exceptional circumstances such that an extension of time should be granted.

[32] In relation to fairness as between the Applicants and other persons in a similar position, it appears from the material filed by the Council that other employees were made redundant at the same time as the Applicants. In my view it would be unfair to those persons to grant an extension of time to the Applicants to challenge dismissals, which on the basis of their own material, were on the grounds of redundancy. Further, in the context of a statute requiring that an applicant seeking an extension of time demonstrate exceptional circumstances, it would be unfair to other persons whose applications have been dismissed because they could not establish the existence of such circumstances, if an extension was granted to the Applicants in the circumstances of this case.

[33] For the reasons set out above, the discretion under s.394(2) for the Commission to extend time for the Applicants to make unfair dismissal applications has not been enlivened. Accordingly, the applications by Mrs Cuthbertson and Mr Harris for unfair dismissal remedies must be dismissed, and Orders to that effect will issue with this Decision.

DEPUTY PRESIDENT

Final written submissions:

1 February 2013.

 1   [2011] FWAFB 975.

 2 Ibid at at [13].

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