Mrs Ming Yang v Southern Star Research Pty Ltd
[2023] FWC 1802
•21 JULY 2023
| [2023] FWC 1802 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Mrs Ming Yang
v
Southern Star Research Pty Ltd
(U2022/10096)
| COMMISSIONER P RYAN | SYDNEY, 21 JULY 2023 |
Application for an unfair dismissal remedy – whether genuine redundancy – applicant’s role not needed – no reasonable redeployment options – application dismissed.
Introduction
Ms Ming Yang (Ms Yang/Applicant) has made an application to the Fair Work Commission (Commission) under s.394 of the Fair Work Act 2009 (Cth) (FW Act) for a remedy, alleging that she had been unfairly dismissed from her employment with Southern Star Research Pty Ltd (Respondent) (Application).
In its Form F3 Employer Response, the Respondent objected to the Application on the ground that the dismissal was a case of genuine redundancy.
The matter was heard before me on 16 February 2023.
Witness statements were tendered from the following persons, who also gave evidence at the hearing:
·The Applicant (Exhibit A1, Exhibit A3 and Exhibit A5); and
·Mr Richard Taylor, the Respondent’s Chief Financial Officer (CFO) (Exhibit R2, Exhibit R3 and Exhibit R4).
The parties also relied on various documents which were admitted into evidence as follows:
·The Applicant’s document bundles (Exhibit A2 and Exhibit A4); and
·The Respondent’s document bundle titled ‘Fair Work Extracts” (Exhibit R1).
For the reasons that follow, I have determined that Ms Yang’s dismissal was a case of genuine redundancy.
Relevant Legislative Provisions
Section 394(1) of the FW Act provides that a person who has been dismissed may apply to the Commission for an order under Division 4 granting a remedy.
Section 390(1) of the FW Act provides that the Commission may order a person’s reinstatement, or the payment of compensation to a person, if it is satisfied that the person was protected from unfair dismissal and has been unfairly dismissed.
Section 385 of the FW Act provides as follows:
“385 What is an unfair dismissal
A person has been unfairly dismissed if the FWC 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.
Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.”
The meaning of “genuine redundancy” is set out at s.389 of the FW Act 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.”
Section 396 of the FW Act requires the Commission to decide whether a dismissal was a case of genuine redundancy before considering the merits of an application.
The Explanatory Memorandum to the Fair Work Bill 2008 provides the following in respect to s.389 of the FW Act:
Clause 389 – Meaning of genuine redundancy
1546. This clause sets out what will and will not constitute a genuine redundancy. If a dismissal is a genuine redundancy it will not be an unfair dismissal.
1547. Paragraph 389(1)(a) provides that a person’s dismissal will be a case of genuine redundancy if his or her job was no longer required to be performed by anyone because of changes in the operational requirements of the employer’s enterprise. Enterprise is defined in clause 12 to mean a business, activity, project or undertaking.
1548. The following are possible examples of a change in the operational requirements of an enterprise:
·a machine is now available to do the job performed by the employee;
·the employer’s business is experiencing a downturn and therefore the employer only needs three people to do a particular task or duty instead of five; or
·the employer is restructuring their business to improve efficiency and the tasks done by a particular employee are distributed between several other employees and therefore the person’s job no longer exists.
1549. It is intended that a dismissal will be a case of genuine redundancy even if the changes in the employer’s operational requirements relate only to a part of the employer’s enterprise, as this will still constitute a change to the employer’s enterprise.
1550. Paragraph 389(1)(b) provides that it will not be case of genuine redundancy if an employer does not comply with any relevant obligation in a modern award or enterprise agreement to consult about the redundancy. This does not impose an absolute obligation on an employer to consult about the redundancy but requires the employer to fulfil obligations under an award or agreement if the dismissal is to be considered a genuine redundancy.
1551. Subclause 389(2) provides that a dismissal is not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within the employer’s enterprise, or within the enterprise of an associated entity of the employer (as defined in clause 12).
1552. There may be many reasons why it would not be reasonable for a person to be redeployed. For instance, the employer could be a small business employer where there is no opportunity for redeployment or there may be no positions available for which the employee has suitable qualifications or experience.
1553. Whether a dismissal is a genuine redundancy does not go to the process for selecting individual employees for redundancy.However, if the reason a person is selected for redundancy is one of the prohibited reasons covered by the general protections in Part 3-1 then the person will be able to bring an action under that Part in relation to the dismissal.
(Emphasis added)
Relevant Factual Background
The Respondent is a clinical research organisation focusing on the biotechnology and medical device industries. The Respondent provides professional support services to companies (typically pharmaceutical companies) who perform clinical trials. The Respondent commenced operations in Sydney in 2010.[1]
On 2 March 2020, the Respondent employed the Applicant in the role of Senior Finance Manager.[2] The role of Senior Finance Manager reported to the Managing Director, Dr David Lloyd and is responsible for managing the finance team.[3] The essential duties and responsibilities of the role included:[4]
· Ensure end of month accounting and reconciliation processes and procedures are completed in a timely and accurate manner;
· Analyse and provide department reports in relation to revenue and expense items, including management accounting;
· Review AR and AP Ledger on a regular basis with team members;
· Prepare and lodge statutory and regulatory returns as required by legislation or accounting standards;
· Prepare components of the annual budget, forecasting and planning;
· Provide assistance to other functions and roles within the financial and management accounting team.
· Oversee invoicing, taxation return, payroll tax, insurance claims and workers compensation;
· Oversight of overseas entities for registration and tax perspective.
The role of Senior Finance Manager required the incumbent to have a minimum of 7-10 years’ experience in general or tax accounting as well as qualification as a certified practicing accountant or chartered accountant.[5]
Upon commencement, the Applicant was paid a base salary of $130,000 per annum plus superannuation. The Applicant’s contract of employment provided that either party may terminate the employment by giving the other party two months’ notice.[6]
In August 2021, the Applicant’s base salary was increased to $135,000 per annum plus superannuation.[7]
On Monday 15 November 2021, the Applicant commenced a period of parental leave and was due to return from parental leave on Monday 17 October 2022.[8] Mr Anthony Aloe was appointed to the role of Senior Finance Manager for the duration of the Applicant’s parental leave.[9]
On or about 22 December 2021, Quadrant Private Equity Pty Ltd (Quadrant) acquired a controlling share in the Respondent through its subsidiary, Qaudrant Growth Fund 2 (Acquisition).[10]
Following the Acquisition, the Respondent sought to grow its business throughout Australia, as well as expand internationally with a focus on South Korea and the United States of America.[11]
The combined effect of the Acquisition and the Respondent’s expansion led to the appointment of a board of directors and increased financial reporting and governance. The Respondent created two new positions within its finance team: the role of CFO in February 2022, and an accountant role in June 2022.[12]
On 5 July 2022, the Applicant sent an email to Ms Sapna Chandra, the Respondent’s human resources manager, requesting a letter to support an application to refinance her home loan. The Applicant requested the letter confirm that she is currently employed, her annual salary, and that she is returning to work in October 2022.[13]
On 8 July 2022, Ms Chandra sent a reply with the letter attached, the letter confirmed the Applicant’s return to work date as 14 October 2022.[14]
In early to mid-August 2022, the employment of person appointed to the position of CFO ended. At this time, and while recruiting a new CFO, the Respondent identified the potential need for a Financial Controller to report directly to the CFO to assist with its expanding operational requirements.[15]
On 23 August 2022, the Respondent’s managing director, Dr David Lloyd, telephoned the Applicant. During this telephone discussion, Dr Lloyd advised the Applicant of the Acquisition and the organisational changes, including the expansion of the finance team. Dr Lloyd and the Applicant also discussed the Applicant’s return to work on 17 October 2022. There was no discussion regarding any significant change or impact to the Applicant’s role.[16]
Mr Taylor was appointed as the new CFO and was employed by the Respondent from 28 September 2022.[17]
On 8 September 2022, prior to the commencement of his employment, Mr Taylor met with Respondent’s board of directors, where he was advised of priorities for his role, which included reviewing/restructuring the finance team, including assessing whether a Financial Controller was needed.[18]
Coincidentally, later that day the Applicant sent an email to Ms Chandra confirming the original return to work date of 14 October 2022 (as noted in the correspondence of 8 July 2022) is suitable to her and requested Ms Chandra to reissue the employment confirming letter with specific wording requesting by the Applicant’s bank.[19]
On 14 September 2022, Ms Chandra sent the following email in reply:[20]
I understand you spoke to David on the 23rd August 2022 and had some initial discussions about your return to the office date and it was agreed that it would be Monday 17th October 2022. Can you please confirm if this is correct and your intention is also to return full time. I can then complete the letter for you today.
I also understand that you spoke to David with regards to the changes at Southern Star Research both in Finance and the business as a whole. With the growth and investment into the business, we had a need to create a CFO position. We had someone join in late February 2022, but he has now left the business. We have been able to secure another CFO and we have someone earmarked to commence in October. Given this change in the management structure and the changes and growth in the business, I understand there will be a need for a functional review of the structure of the Finance team. While no decisions have been made at this stage, this review may result to [sic] possible changes in the finance structure which may have an impact your role.
While I appreciate this may be unsettling for you, I wanted to let you know where we were at in terms of the business and the finance team and what to expect in the near future.
(Emphasis added)
On 15 September 2022, the Applicant responded as follows:[21]
It's nice to hear back from you and we’re all good here. I’m happy to return to work on a full-time basis starting from 17th Oct and appreciate for your heads-up on the team update and some possible structure changes. While I keep this in mind we can have a discussion once I come back.
Upon commencing in the role of CFO on 28 September 2022, Mr Taylor undertook a review of the structure of the finance team in the context of the Respondent’s operational requirements and determined:
The Respondent required a Financial Controller to manage:
othe increased reporting requirements to the board of directors;
othe increased complexity of the international expansion;, and
othe greater level of internal controls and financial governance expected of Quadrant;
The Financial Controller would be a more senior and experienced role than the Senior Finance Manager with additional duties and responsibilities; and
That the role of Financial Controller would absorb the duties of the Senior Finance Manager.[22]
Mr Taylor prepared a position description for the role of Financial Controller which would report to the CFO. The essential duties and responsibilities of the role, in addition absorbing the duties and responsibilities of the role of Senior Finance Manager, included:
· Managing the overseas finance teams and ensuring that their management accounts are produced in a timely manner, consolidate into the Australian holding group, understand, generate and post all consolidation entries;
· Developing business plans to expand the business both in Australia and internationally with associated forecasts and supporting financial information;
· Preparing annual budgets and quarterly forecasts in conjunction with senior business managers with a particular focus on revenue;
· Preparation of annual report including consolidation of all international entities, local subsidiaries and statutory financial statements;
· Developing a financial governance framework and implementation of strong financial controls to ensure integrity of financial numbers;
· Develop better financial processes with a move to more integrated and automated processes and less reliance on manual interventions; and
· Oversight of the audit of international entities.[23]
The role of Financial Controller required the incumbent to have at least 10 years’ experience as a financial controller and would have direct supervisory responsibilities for finance teams located in Australia and international entities.[24]
On 4 October 2022, Ms Chandra sent an email to the Applicant as follows:
As per my previous email on the 14th September 2022, with regards to the restructure of the finance team. With the new CFO on board, we now are in a position to discuss the impact that this organisational restructure has on your current position.
We would like to invite you to meet in person with myself and CFO, Rick Taylor either on Thursday morning or Friday afternoon this week to discuss this further.
Please let me know if either of these days work or if you could please suggest another day/ time that might be suitable.
Please feel free to have a someone join the meeting as a support person. Please let me know if you would like to take up this option.
Please let me know if you have any questions. [25]
On 6 October 2022, the Applicant attended a meeting with Mr Taylor and Ms Chandra which went for approximately one hour.[26] Neither party provided a complete account of what occurred during this meeting. Furthermore, there was a dispute as to whether the Applicant insisted on being provided with a copy of the position description for the Financial Controller role during the meeting, or whether she agreed to receiving a copy at a later time. I do not consider anything turns on this, and in any event, the position description was provided to the Applicant the next day. Having regard to the evidence before me, I make the following factual findings in relation to this meeting:
· Mr Taylor informed the Applicant that the Respondent has decided to create the role of Financial Controller and that the role of Senior Finance Manager will be made redundant effective from 14 October 2022;[27]
· Mr Taylor explained in broad terms the Acquisition, the Respondent’s expansion/growth plans and the impact on the finance team;[28]
· Mr Taylor explained in broad terms the core duties and responsibilities and that the required 10 years’ experience as a financial controller;[29]
· Mr Taylor advised the Applicant that as her previous experience in a financial controller role was two and a half years, she had a big gap to the requirements of the role;[30]
· Mr Taylor advised the Applicant that due to seniority of the role and her limited experience as a Financial Controller, it would not be offering redeployment to the role;[31]
· Mr Taylor advised the Applicant that there were three options available to the Applicant:
1. To accept a redundancy package based on her contract of employment and the National Employment Standards;
2. To apply for the role of Financial Controller;
3. To apply for alternative vacant roles within the Respondent.[32]
· The Applicant requested a copy of the position description for the role of Financial Controller and was advised that it would be sent to her.[33]
On 7 October 2022, Ms Chandra sent an email to the Applicant which attached two documents: a copy of the position description for the Financial Controller role and a letter titled “Finance Structure & Redundancy – Notification”. The letter stated:[34]
Dear Ming,
Finance Structure & Redundancy - Notification
Further to our meeting yesterday with myself and Sapna Chandra HRM, this letter summarises our discussion and outlines topics for your consideration.
As per our discussions with you and previous discussions with David Lloyd, the Finance division has gone through major changes in the past nine months or so. The acquisition by the Private Equity firm Quadrant has meant a significant acceleration in the business and upscaling of the expectations on the finance team. As a result Quadrant have added a CFO and Financial Accountant and now require an experienced Financial Controller. The aim is to drive the growth both here and expand into Asia Pacific (mainly South Korea) and the USA. Further the introduction of a Board of Directors has significantly increased the levels of reporting required.
Given the above reason and to achieve Southern Star Research future business goals, this letter is to confirm that Senior Finance Manager role will be made redundant effective 14th October 2022.
We discussed the options available to you as a result of your current position being made redundant. The options are:
(i) To accept the redundancy package offered to you by Southern Star Research, which in broad terms would be one month’s notice and 4 weeks’ redundancy based on National Employment Standards and your tenure with Southern Star Research.
(ii) To apply for the new Financial Controller position (a draft PD is attached to this email) Due to the seniority of this role we could not consider this as a redeployment option and therefore welcome you to apply for the role. The recruitment for this role will therefore follow the standard SSR recruitment processes. As discussed, this role will be 100% office based and is a challenging role to meet the new requirements.
(iii) To apply for alternative vacant roles within Southern Star Research. Please note that these positions will be filled following the SSR standard recruitment process.
In the event that you are successful in obtaining a new role within SSR, your employment will continue and you will not be entitled to a redundancy package or any termination benefits.
Alternatively, if you wish to accept the first option outlined above then your notice period will be paid in lieu and therefore you will not be required to return to work following your parental leave due to end on the 14h October 2022.
Our intention is to meet with you again on Wednesday 12th October 2022 at 10am either via Zoom or face to face where we would like to discuss your decision based on the above options. As we mentioned, we are speaking with you confidentially as the affected individual in the restructure and will communicate the change to the broader team once you have made your decision, so we appreciate your trust and confidence in this matter.
May I take this opportunity to remind you that in addition to talking this decision over with those closest, you may find it beneficial to access support available through our IOH, Employee Assistance Program 1800 811 169. Both Sapna and I are of course also available to answer any questions you may have.
Ming, please take the next few days to consider the options that we have presented to you today and I look forward to speaking with you next week.
Yours sincerely,
Rick Taylor
On 10 October 2022, the Applicant replied by email to Ms Chandra confirming her availability to meet with Mr Taylor and Ms Chandra on Wednesday 12 October 2022 via Zoom. The Applicant’s correspondence also relevantly stated:[35]
Thanks for sending through the letter and JD.
With regards to option 1, I thought it was communicated by Rick that the payout would be 2 months notice period plus redundancy payment however in the letter it stated 1 month notice period only. Would you mind to double check?
I have read the JD of financial controller for option 2 and agreed that my skillsets have a big gap to the requirements like Rick has mentioned and therefore this position is not a good fit for me.
I started my career as a graduate accountant and have worked my way up in the past 15 years. As talked on last Thursday meeting, Accounting is my passion and where I specialise. Please let me know if any other suitable accounting role in Southern Star Research in relation to option 3 and I’ll take into consideration.
(Emphasis added).
On 11 October 2022, Ms Chandra sent an email in reply to the Applicant in which she confirmed:[36]
· The notice period is one month based on the (updated) employment agreement dated 28 July 2021 and attached a copy of the contract;
· There are currently no other finance roles available; and
· The details for the Zoom meeting on 12 October 2022.
On 12 October 2022, the Applicant attended a meeting with Mr Taylor and Ma Chandra via Zoom during which:
· The Applicant confirmed that she did not wish to apply for the role of Financial Controller and was only interested in other finance roles;
· The Applicant requested that she receive a redundancy payment equivalent to six months’ salary, which was refused; and
· Mr Taylor confirmed that the Applicant’s role would be made redundant and her employment terminated effective from 14 October 2022.[37]
Later the day, Ms Chandra sent correspondence to the Applicant as follows: [38]
Dear Ming,
Thank you for your time today.
We met today with Sapna Chandra HRM, to consult with you about your options that we proposed to you last week with regards to the Finance restructure and your role of Senior Finance Manager being made redundant. Please note that at this meeting and the previous meeting on the 6th October 2022, Southern Star Research offered you the option to bring a support person with you. This letter summarises our discussion today.
As per our discussions with you last Thursday on 6th October 2022 and previous discussions with David Lloyd on 23 August 2022, and emails sent to you by Sapna on 14th September 2022 and 4th October 2022, we confirmed and consulted with you with regards to the changes in the business and the finance structure, and the possibility of this change having an impact on your current position. In our meeting last week, we gave you the opportunity to ask any questions you may have and went through the structure that the business would be moving forward with. We confirmed the need for a more senior finance resource and advised the Senior Finance Manager role will be made redundant on 14th October 2022.
In the meeting today we again went through the options that were available to you as a result of your current position being made redundant. These were presented to you last week at the meeting.
The options were:
1.to accept the redundancy package offered to you by Southern Star Research, which would be one month’s notice and 4 weeks redundancy based on National Employment Standards and your tenure with Southern Star Research;
2.to apply for the new Financial Controller position (a draft PD sent to you previously); or
3.to apply for alternative vacant roles within Southern Star Research. Please note that these positions will be filled following the business’ standard recruitment process.
You confirmed in an email on 10th October 2022 and today in the meeting that Option (ii) the role of the Financial Controller would not be suitable for you due to the gap in your skills and experience.
You also confirmed today that option (iii) would not be suitable for you as you would like to continue your career in Finance and unfortunately at this point there are no vacant position in finance at Southern Star Research.
We discussed option (i) as the viable option going forward. We therefore confirm that your employment will be terminated on 14th October 2022 due to redundancy. Set out below is an indicative breakdown of the payment that will be made to you:
[Table Redacted]
As we explained to you, the severance payment of 4 weeks is based on your tenure with Southern Star Research and is in line with the National Employment Standard. If you require more information, please see the Fair Work Ombudsman’s website ( This payment would generally be made to you within 7 days of your last day with us.
You said that that you were looking for a payment of 6 months and we confirmed that this is not a viable option. As we mentioned in the meeting, if you would like to discuss further we would be happy to meet with you again on Friday at your request via Zoom or in person. Please let me know what time might suit.
[Paragraph Redacted]
Ming, on behalf of Southern Star Research I would like to thank you for your contribution and wish you well in your future endeavours.
Yours sincerely,
Rick Taylor.
The Applicant did not request a further meeting with the Respondent and her employment was terminated on 14 October 2022.[39]
On 19 October 2022, Ms Chandra sent the Applicant details of her termination payment.[40]
In late October 2022, and after liaising with recruiters regarding the availability of suitable candidates, the Respondent appointed Mr Aloe to the role of Financial Controller. In making this decision Mr Taylor took into consideration that Mr Aloe has in excess of 15 years’ experience as a Financial Controller and substantial experience in managing overseas entities.[41]
In recognition of the experience required for the role, the remuneration package for the Financial Controller role is substantially more than the remuneration package for the Senior Finance Manager role.[42]
On 11 November 2022, Ms Chandra and Mr Taylor provided Ms Yang with details of recruiters and an available finance role within the industry.[43]
Redeployment
At the time of the Applicant’s dismissal, the Respondent had the following roles available:
· Clinical Research Associate;
· Clinical Project Manager;
· Medical Writer; and
· Business Development Manager for South Korea.[44]
Mr Taylor stated that there were not any finance roles available, other than the role of Financial Controller.
It is not in dispute that the Applicant was not interested in alternative roles unless they were accounting or finance roles and that, other than the Financial Controller role, there were no accounting or finance roles available at the time of the Applicant’s dismissal.[45]
It is also not in dispute that Mr Taylor did not discuss or consider any potential redeployment to a role within an associated entity of the Respondent. However, in January 2023, Mr Taylor he made enquiries with Quadrant and was advised that there were no available finance roles within Quadrant (or any of its associate entities) at that time or at the time of the Applicant’s dismissal.[46] The Applicant did not disagree with this or contend that there were other suitable redeployment options within any associated entity.[47]
Summary of the Applicant’s Submissions
While the Applicant initially disputed that the Respondent no longer requires the role of Senior Finance Manager to be performed by anyone and submitted that Mr Aloe continues to be employed in that role, in closing submissions the Applicant accepted that the Financial Controller role is different and has expanded duties and responsibilities when compared to the Senior Finance Manager role.[48]
However, the Applicant submits that it would have been reasonable for the Respondent to have redeployed her to the role because she has similar skills and experience to Mr Aloe and that prior to commencing parental leave she was responsible for training Mr Aloe and completing a handover.
The Applicant submits that Mr Taylor did not give due consideration to her skills and experience and was dismissive in relation to considering her for the Financial Controller role by stating that she had a “big gap to the requirements of the role”, and that this was the reason why she did not apply for the role of Financial Controller.
The Applicant submits that the role of Senior Finance Manager is covered by the Health Professionals and Support Services Award 2020 (HPSS Award) as a Level 8 support service employee and that the Respondent failed to comply with the consultation requirements set out in clause 34.
The Applicant further submitted that she is entitled to return to her pre-parental leave position and that the Respondent did not comply with s.83 of the FW Act which requires an employer to consult with an employee who is taking parental leave about major workplace changes.
The Applicant submitted that the Respondent’s failure to advise her that her role would be made redundant until just prior to her return to work, and shortly after she had requested confirmation of employment to refinance her home loan, was unfair and denied her the opportunity to commence seeking alternative employment while on parental leave.
The Applicant disputed that she ‘accepted’ the redundancy package and submits that it was forced upon her. The Applicant also submitted that the Respondent failed to provide the correct payment in lieu of notice, stating that she was entitled to two months’ notice or payment in lieu rather than one month.
Summary of the Respondent’s Submissions
The Respondent submits that the Applicant’s dismissal was a case of genuine redundancy.
The Respondent submits that s.396(d) of the FW Act requires the Commission to decide whether the dismissal was a case of genuine redundancy before considering the merits of the Application.
The Respondent referred to s.389 of the FW Act which states that a dismissal will be 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; and
(c)it would not have been reasonable in all the circumstances for the employee to be redeployed within the employer’s enterprise or the enterprise of an associated entity of the employer.
The Respondent submits that it is necessary to determine whether it no longer required the Applicant’s position to be performed by anyone because of changes in the operational requirements of the Respondent’s enterprise.
The Respondent submits that there are changes in the operational requirements of the employer’s enterprise in circumstances where an employer restructures its business to improve efficiency, productivity, sales, revenue or some other aspect of performance.[49]
The Respondent submits that the test is whether the employee has any duties left to discharge that survived in some form after the reorganisation or redistribution of the functions, duties and responsibilities of the job of a particular employee. Where there is no longer any function or duty to be performed by that employee, his or her job becomes redundant, notwithstanding that the employee’s duties may be performed by other employees.[50]
The Respondent submits that it identified a need for the Financial Controller role with more senior duties and responsibilities than the Senior Finance Manager role and that the new role would absorb the duties and responsibilities of the Senior Finance Manager. The Respondent submits that as a result it no longer required the Senior Finance Manager role to be performed by anyone.
The Respondent submits the Applicant does not dispute that the Senior Finance Manager role is no longer required to be performed by anyone because of changes in the operational requirements of the Respondent’s enterprise, rather the Applicant challenges the fairness of the redundancy on her personal circumstances and the adequacy of her redundancy payment. The Respondent submits that these matters are not relevant to a consideration of whether the Applicant’s dismissal was a case of genuine redundancy.
The Respondent submits that while there is no modern award or enterprise agreement to the Applicant’s employment, the consultation it undertook was comprehensive.
The Respondent submits that it is not covered by the HPSS Award as it is not an employer whose business and/or activity is in the delivery of health care, medical services or dental services and that, in any event, the Applicant’s employment, as a qualified accountant, is not covered by the HPSS Award or any other modern award that covers the Respondent. The Respondent further submitted that the coverage of accountants under modern awards is limited to very few awards, none of which cover the Respondent.
The Respondent cited the decision in Heraud v Roy Morgan Research Ltd[51] and submitted that it complied with its obligations under s.83 of the FW Act to give information to the Applicant once a decision concerning her role had been made.
The Respondent submits that the Applicant agreed with Mr Taylor’s assessment that she did not have sufficient experience to be ‘automatically’ redeployed into the Financial Controller role and declined the opportunity to apply for the role. The Respondent further submits that there were no other available positions within the Respondent’s enterprise or an enterprise of an associated entity into which it would have been reasonable in all the circumstances to redeploy the Applicant, noting the Applicant was only willing to consider accounting or finance roles.
Consideration
There is no dispute, and I so find, that the Applicant was dismissed by the Respondent.
The issue in dispute is whether the Applicant’s dismissal was a case of genuine redundancy within the meaning of s.389 of the FW Act.
Was the Applicant’s job no longer required to be performed by anyone because of changes in the operational requirements of the Respondent’s enterprise? (s.389(1)(a))
Section 389(1)(a) of the FW Act provides that a person’s dismissal will be a case of genuine redundancy if his or her job is no longer required to be performed by anyone because of changes in the operational requirements of the employer’s enterprise.
The expression “the person’s employer no longer required the person’s job to be performed by anyone” has long been used and applied in industrial tribunals and courts as a practical definition of redundancy.[52]
A job involves “a collection of functions, duties and responsibilities entrusted, as part of the scheme of the employees’ organisation, to a particular employee”.[53]
Where an employer might rearrange their organisational structure by breaking up the collection of functions, duties and responsibilities attached to a single position and distributing them among other positions, including newly-created positions, the critical question 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.[54]
The test is whether the job previously performed by the employee still exists, not whether the employee’s duties survive,[55] notwithstanding there are aspects of the employee’s duties still being performed by other employees.[56]
In determining whether a dismissal is a case of genuine redundancy, it is not the function of the Commission to form a view about whether the employer’s decision to make a position redundant was objectively fair or justifiable. The Commission is only concerned with whether the employer acted because of changes in its operational requirements.[57]
Having regard to the evidence before me, I am satisfied that the Respondent’s decision that it no longer requires the role of Senior Finance Manager to be performed by anyone was made because of changes in its operational requirements arising out of the Acquisition and its international expansion.
After conducting a review of its operational requirements, the Respondent created a new role of Financial Controller and re-distributed the duties previously performed by the Applicant to that role and at the same time, added further duties. The Respondent no longer wished to have the Senior Finance Manager role performed by anybody and it ceased to exist from 14 October 2022.[58]
On a comparison of the duties and responsibilities between the two roles,[59] it is evident that the Financial Controller role provides for more senior and expansive duties and responsibilities than the role of Senior Finance Manager and the Applicant accepted this.[60] That the Financial Controller role has absorbed the duties previously performed by the Applicant does not detract from the Senior Finance Manger role having been made redundant.
While the Applicant submitted that she had similar skills and experience to Mr Aloe and, at the very least, her suitability for the role should have been given greater consideration, the process for selecting individual employees for redundancy is not relevant to whether a dismissal was a case of genuine redundancy.[61]
For the reasons set out above, I find that the Respondent has satisfied s.389(1)(a) of the FW Act.
Did the Respondent comply with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy? (s.389(1)(b))
Pursuant to s.389(1)(b), for there to be a genuine redundancy, the Respondent must have complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.
The Applicant contended that the Respondent failed to meet its consultation obligations under clause 34 of the HPSS Award and s.83 of the FW Act and therefore, her dismissal was not a case of genuine redundancy. In relation to the HPSS Award, the Applicant contends her employment fell within the scope of the Level 8 support service employee classification.
The Applicant has not explained how the HPSS Award applied to her employment beyond the bare assertion that she is covered by that award.
A modern award applies to particular employment if the modern award covers the employee and the employer, the modern award is in operation, and no other provision has the effect that the modern award does not apply.[62] A modern award covers an employer and employee if the award is expressed to cover the employer and employee.[63]
Clause 4 of the HPSS Award deals with coverage and provides:
4.1 This industry and occupational award covers:
(a) Employers throughout Australia in the health industry and their employees in the classifications listed in Schedule A – Classification Definitions to the exclusion of any other modern award;
(b) Employers engaging a health professional employee in the classifications listed in Schedule A – Classification Definitions.
4.2 The health industry means employers whose business and/or activity is in the delivery of health care, medical services and dental services.
Mr Taylor gave evidence that the Respondent is a clinical research organisation which provides professional support services to other businesses and that it is not an employer whose business and/or activity is in the delivery of health care, medical services and dental services.
The Applicant did not challenge that evidence and there is no reason why I should not accept it. Accordingly, I find that the Respondent is not an employer who business or activity is covered by the HPSS Award.
Furthermore, I do not accept that an accountant falls within the scope of the classification definitions set out in Schedule A of the HPSSA Award, whether under level 8 support service employee classification or any other support service employee classification. Nor does an accountant fall within the scope of a health professional employee (see clause 4.1(b) of the HPSS Award).
It follows that the HPSS Award is not a modern award that applied to the Applicant’s employment.
The Applicant did not identify any other modern award or enterprise agreement that applied to her employment. This is unsurprising as the coverage of accountants across the modern award system is limited to a small number of awards[64] and the Miscellaneous Award 2020 expressly excludes accountants from its coverage.
Accordingly, I find that the consultation obligation under s. 389(1)(b) of the FW Act is not enlivened, and therefore does not form part of my consideration as to whether the Applicant’s dismissal was a case of genuine redundancy.
In relation to the Applicant’s contention that the Respondent failed to comply with its obligation to consult pursuant to s.83 of the FW Act, the Respondent’s compliance or otherwise with that obligation, which arises under the National Employment Standards, is not relevant to my consideration as to whether the Applicant’s dismissal was a case of genuine redundancy and I make no findings in relation to it.
Was it reasonable in all the circumstances for the Applicant to have been redeployed within the Respondent’s enterprise or the enterprise of an associated entity? (s.389(2))
Pursuant to s.389(2), a person’s dismissal will not be a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to have been redeployed within the Respondent’s enterprise or that of an associated entity of the Respondent.
In Stegbar, Commissioner Saunders (as the Deputy President then was) helpfully summarised the approach to s.389(2) as follows:[65]
[37] For the purposes of section 389(2) of the Act, the Commission must consider whether there was a job or a position or other work within the employer’s enterprise (or that of an associated entity) to which it would have been reasonable in all the circumstances to redeploy the dismissed employee. There must be an appropriate evidentiary basis for such a finding. The word “redeployed” in section 389(2) of the Act should be given its ordinary and natural meaning, which is to “transfer to another job, task or function”.
[38] If an employer wishes to rely on the “genuine redundancy” exclusion in section 389 of the Act, then it would ordinarily be expected to adduce evidence, on the question of redeployment, as to whether there was a job or a position or other work within the employer’s enterprise (or that of an associated entity) to which it would have been reasonable in all the circumstances to redeploy the dismissed employee. Such evidence would usually include the steps taken by the employer to identify other jobs, positions or work which could be performed by the dismissed employee.
[39] Whether it would have been reasonable in all the circumstances for the person to be redeployed directs attention to the circumstances which pertained when the person was dismissed. However, the circumstances leading up to the time the employee was dismissed may, in particular cases (such as where there has been a redeployment period for an employee prior to their dismissal), be relevant to a determination of whether it would have been reasonable in all the circumstances for the employee to have been redeployed.
[40] In determining whether redeployment would have been reasonable a number of matters may be relevant, including:(a)whether there exists a job or position or other work to which the employee can be redeployed;
(b)the nature of any available position;
(c)qualifications required to perform the job;
(d)the employee’s skills, qualifications and experience. The employee should have the skills and competence required to perform the role to the required standard either immediately or within a reasonable period of retraining; and
(e)the location of the job in relation to the employee’s residence and the remuneration which is offered.
[41] Where an employer decides that, rather than fill a vacancy by redeploying an employee into a suitable job in its own enterprise, it will advertise the vacancy and require the employee to compete with other applicants, it might subsequently be found that the resulting dismissal is not a case of genuine redundancy.
[42] It is important, however, to appreciate that, because there is a requirement to assess the reasonableness of redeployment “in all the circumstances”, it is not possible to establish binding or decision rules concerning the application of section 389(2) of the Act in all cases; the circumstances of each particular case must be considered.
[Footnotes omitted].It is clear on the evidence that any consideration of ‘redeployment’ was limited to the Respondent offering the Applicant the opportunity to participate in a competitive process for the Financial Controller role or other available roles within the Respondent, and that there was no consideration of redeployment of the Applicant to a position within an associated entity of the Respondent.
Although subjecting an employee to a competitive process for an advertised vacancy may lead to a conclusion that the employee’s dismissal was not a case of genuine redundancy, I am satisfied that it would not have been reasonable in all the circumstances for Applicant to be redeployed within the Respondent’s enterprise, or an enterprise of an associated entity of Respondent, for the following reasons.[66]
First, the Financial Controller role is a more senior role with more senior and expansive duties and responsibilities than the Applicant’s previous role. The Respondent formed the view that the Applicant did not have the required experience for the role. The Applicant accepted this and after having had the opportunity over a number of days to review the position description for the Financial Controller role, advised the Respondent that she agreed with its assessment that there was a big gap between her skillset and the requirements of the role and that it was not a good fit for her.
Throughout the proceedings the Applicant has attempted to downplay that correspondence and submitted that she only stated that in response to the comment made by Mr Taylor in the meeting 6 October 2022. However, I do not accept that submission. The Applicant’s correspondence of 10 October 2022 is unambiguously clear and the Applicant confirmed that she did not wish to apply for the Financial Controller role in the meeting on 12 October 2022.
Second, the Applicant made it clear that she would only consider ‘applying’ for any other role if it was an accounting or finance role.[67] Mr Taylor gave evidence that there were no available accounting or finance roles within the Respondent, or any associated entity of the Respondent, at the time of, or in the lead up to, the Applicant’s dismissal. The Applicant has not challenged that evidence or identified any role, either within the Respondent or any associated entity, to which it would have been reasonable to redeploy her.[68]
That the Respondent did not turn its mind to whether there were any suitable roles within any associated entity at the time of the Applicant’s dismissal is of no consequence in the circumstances of this matter as there were no suitable roles available, and for the purposes of s.389(2), the Commission must find, 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 the Applicant.[69]
The Applicant’s grievance in this respect appears to be based on the Respondent’s failure to discuss rather than any contention that there was an available role to which she could have been redeployed.
Other matters
The Applicant is clearly aggrieved with the quantum of her redundancy pay and payment in lieu of notice. In relation to the latter, there is a dispute between the parties as to whether she agreed to vary her contract of employment to reduce the notice of termination provision to one month in consideration for a salary increase in July 2021.
While the determination of a contractual dispute is beyond the jurisdiction of the Commission, to the extent that matter remains unresolved, it is open to the Applicant to pursue through a court of competent jurisdiction.
Conclusion
For the reasons set out above, I am satisfied that the Applicant’s dismissal was a case of genuine redundancy within the meaning of s.389 of the FW Act because as at 14 October 2022:
(a) The Respondent no longer required the Applicant’s job to be performed by anyone because of changes in the operational requirements of its enterprise; and
(b) There was no obligation to consult as the Applicant was not covered by a modern award or enterprise agreement that applied to the employment; and
(c) It would not have been reasonable in all the circumstances for the Applicant to be redeployed within the Respondent’s enterprise or the enterprise of an associated entity of the Respondent.
Therefore, the Applicant was not unfairly dismissed within the meaning of s.385 of the FW Act.
The Application is dismissed.
COMMISSIONER
Appearances:
M Yang, Applicant.
R Taylor, for the Respondent.
Final Written Submissions:
Respondent: 21 February.
Applicant: 1 March.
Hearing details:
2023.
Sydney:
16 February.
[1] Exhibit R2 at [6]-[7]; Exhibit R4 at [20].
[2] Exhibit A1; Exhibit R2 at [8].
[3] Exhibit R2, Annexure RT1.
[4] Exhibit R2, Annexure RT1.
[5] Exhibit R2, Annexure RT1.
[6] Exhibit A2 (Hearing Book at p.173-180).
[7] Transcript at PN382-PN385.
[8] Exhibit A1; Exhibit R2 at [9].
[9] Exhibit A1.
[10] Exhibit R2 at [11]; Exhibit R4 at [38].
[11] Exhibit R2 at [11].
[12] Exhibit R2 at [12]-[15].
[13] Exhibit A1; Exhibit A2 (Hearing Book at p.136).
[14] Exhibit A1, Exhibit A2 (Hearing Book at p.133, 135).
[15] Exhibit R2 at [16].
[16] Transcript at PN118-PN123; PN363-PN364.
[17] Exhibit R2 at [4].
[18] Exhibit R2 at [18]; Transcript at PN443.
[19] Exhibit A2 (Hearing Book at p.138).
[20] Exhibit A2 (Hearing Book at p.137-138).
[21] Exhibit A2 (Hearing Book at p.137).
[22] Exhibit R2 at [19].
[23] Exhibit R2 at [20], Annexure RT3.
[24] Exhibit R2, Annexure RT3.
[25] Exhibit A2 (Hearing Book at p.142); Exhibit R2 at [23], Annexure RT4.
[26] Exhibit R2 at [24]; Transcript at PN176-PN177.
[27] Exhibit R2 at [24].
[28] Exhibit R2, Annexure RT6.
[29] Transcript at PN472-PN473, PN530.
[30] Exhibit A1; Exhibit A3 at [4.3]; Transcript at PN452.
[31] Exhibit R2 at [24].
[32] Exhibit R2 at [25].
[33] Transcript at PN367, PN426-PN464, PN530, PN547.
[34] Exhibit A2 (Hearing Book p.130-131, 140-141); Exhibit R2 at [26], Annexure RT5.
[35] Exhibit A2 (Hearing Book p.140); Exhibit R2 at [27].
[36] Exhibit R2 at [28], Annexure RT6.
[37] Exhibit A1; Exhibit A3 at [4.4], [4.6]; Exhibit R2 at [29], Annexure RT7.
[38] Exhibit A1; Exhibit A2 (Hearing Book p.155-157); Exhibit R2 at [30], Annexure RT7
[39] Exhibit R2 at [31].
[40] Exhibit R2 at [32].
[41] Transcript at PN477-PN488.
[42] Transcript at PN485-PN490.
[43] Exhibit R2, Annexure RT9.
[44] Exhibit R2 at [33].
[45] Exhibit A2 (Hearing Book at p.140); Exhibit A3 at [4.4]; Exhibit R2 at [33]-[34], Annexure RT6.
[46] Exhibit A3 at [7]; Exhibit R4 at [37]-[55]; Transcript at PN540.
[47] Transcript at PN542-PN543.
[48] Transcript at PN664-PN665.
[49] Citing Staniland v Stegbar Pty Ltd[2017] FWC 4703 (Stegbar) at [13].
[50] Citing Jones v Department of Energy and Minerals (1995) 60 IR 304 at 308 (per Ryan J) as applied in Ulan Coal Mines Limited v Howarth [2010] FWAFB 3488 (Ulan) at [17].
[51] [2016] FCCA 185 at [174]-[175].
[52] Ulan at [15]
[53] Ulan at [17] applying Jones v Department of Energy and Minerals (1995) 60 IR 304 at 308 (per Ryan J).
[54] Ibid.
[55] Kekeris v A. Hartrodt Australia Pty Ltd[2010] FWA 674 at [27].
[56] Dibb v Commissioner of Taxation [2004] FCAFC 126 (Dibb) at [41].
[57] Low v Menzies Group of Companies [2014] FWC 7829 at [16] cited with approval in Adams v Blamey Community Group[2016] FWCFB 7202 at [14].
[58] See Dibb at [44].
[59] See [14] and [32] above.
[60] Exhibit A2 (Hearing Book at p.140); Transcript at PN664-PN665.
[61] UES Int’l v Leevan Harvey[2012] FWAFB 5241 at [27].
[62] Section 47 of the FW Act.
[63] Section 48 of the FW Act.
[64] See Banking, Finance and Insurance award 2020, Black Coal Mining Industry Award 2020, Electrical Power Industry Award 2020 and Rail Industry Award 2020.
[65] Stegbar at [37]-[42].
[66] Ulan Coal Mines Limited v Honeysett and Others[2010] FWAFB 7578 at [35].
[67] Transcript at PN368-PN370.
[68] Transcript at PN540-PN542.
[69] Technical and Further Education Commission T/A TAFE NSW v Pykett[2014] FWCFB 714 at [36].
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