Ms Jessica Andersen v XL Express Pty Ltd

[2012] FWA 9011

[2012] FWA 9011

FAIR WORK AUSTRALIA

DECISION

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

Ms Jessica Andersen
v
XL Express Pty Ltd
(U2012/7897)

SENIOR DEPUTY PRESIDENT RICHARDS BRISBANE, 26 OCTOBER 2012

Summary: s.394 - jurisdictional objection - whether genuine redundancy.

[1] On 8 May 2012, Ms Jessica Anderson (“the Applicant”) lodged an application under s.394 of the Fair Work Act 2009 (“the Act”), seeking an unfair dismissal remedy. The Applicant claims that she was unfairly dismissed from her position as a Customer Service Officer (“CSO”) with XL Express Pty Ltd (“the Respondent”) on 27 April 2012.

[2] The application was subject to a conciliation on 29 May 2012, which was unsuccessful. The file was then allocated to me for purposes of determination on 8 October 2012. The matter was heard in Brisbane on 22 October 2012.

[3] The Respondent contends that the Applicant is not a person who was protected from unfair dismissal for reason that the Applicant’s dismissal was a case of genuine redundancy for the purposes of s.389 of the Act. 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.

[4] The Explanatory Memorandum to the Fair Work Bill 2008 provides as follows in relation to s.389 of the 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 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, 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 employees;



• 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 a 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 dismissal is not a case of genuine redundancy if it would have been reasonable in all 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.” (Underlining added)

[5] The Applicant contends that she was dismissed after such time as she announced to the Respondent that she was pregnant. It appears the Applicant had intended to take leave from August 2012. The Applicant further claims that she was informed that she was being made redundant in preference to other employees because she had commenced her employment after the other employees. That is, the Applicant was made redundant from the customer service team because she was the most recent employee employed as a member of that team.

[6] The Applicant contends that this claim is false because there was a casual employee who commenced work after such time as she was employed, which was on 17 October 2011. That employee was a casual employee engaged at a lower classification than and performing different duties to the Applicant.

[7] The Applicant also points out that her separation certificate as completed by the Respondent gave the reason for the separation as a shortage of work. The Applicant contended however that there was never any shortage of work and that she was very busy throughout the course of her period of employment (from October 2011 to April 2012) in the customer service role.

[8] I add that when a casual employee in an administrative role (which was the position about which the Applicant had complained above) ceased her duties unexpectedly after the Applicant had been made redundant, the Applicant was re-engaged in that casual’s position, where she remained until she left to have her child in August 2012.

[9] The Respondent contends that the Applicant was made redundant on 27 April 2012.

[10] Mr Aaron Carr, the National Operations Manager, gave evidence that the Brisbane depot had been placed under review by the time he joined the Respondent in February 2012. The review was implemented over the March to April 2012 period.

[11] Mr Carr provided evidence by way of emails from that time that demonstrated the Respondent was reviewing the Brisbane depot and seeking to reduce the costs of its operations and remove over-staffing in some areas. Mr Carr’s job had been to give effect to that review of operations. These were considerations that had commenced at a time at which Mr Carr had been absent any knowledge of the Applicant's pregnancy.

[12] Mr Carr’s evidence was that the economic climate was such that volumes were decreasing each week and had dropped by as much as 20% on previous months. Mr Carr also gave evidence that three CSOs were not warranted for reasons of the relocation of the home delivery fleet to the Brisbane depot, the rollout of carton scanner technology which meant that customers would be able to use the Internet to track and trace their cartons instead of contacting the customer service team, and that a number of the current service team reporting functions were to be automated. Mr Carr contended that these changes would continue to affect the volume of incoming queries to the customer service team. Other administrative related roles are also under continuing review.

[13] The selection of the Applicant for redundancy was made by Mr Graeme McCarthy, the Brisbane Manager for the Respondent. Mr McCarthy had been aware of the Applicant's pregnancy. It appears that he had been informed of the Applicant's pregnancy on or about 28 February 2012. The e-mail trail tendered in evidence shows that Mr McCarthy brought to the attention of his direct report, Mr Clive Prescott, his plan not to maintain the Applicant’s position when she left on unpaid leave. The e-mail correspondence shows that Mr McCarthy was aware that the Applicant did not qualify for maternity leave and was to use the period of her absence as the avenue by which the customer service team numbers could be reduced.

[14] Mr McCarthy indicated in his e-mails to Mr Prescott that he had taken the decision to make the Applicant redundant as she had been employed as a CSO more recently than the other two permanent CSOs. A casual employee had been employed after such time as the Applicant had been herself employed but this was an administrative position and not a permanent or full-time position. The Applicant had been employed as a full-time salaried CSO.

[15] Mr McCarthy's e-mails as tendered show that he intended to absorb the Applicant’s functions within the other two CSO roles.

[16] As it was, there was some argument in these proceedings that the Applicant was re-employed by the Respondent in June 2012 on a casual basis performing a mix of duties some partly administrative and involving scanning, and the remainder comprised her former duties as a CSO (on a 1:3 ratio over a week). The Applicant was given the irregular casual Grade 2 EDP operator (Scanning) clerk’s position which had become vacant owing to a resignation. The Applicant appears to have remained in this position from June through to late August, when she left the business to have her child.

[17] Mr McCarthy's e-mails suggest that his reasoning as he claimed it to have been in respect of the redundancy was an economic consideration only and was not in any way affected by or for reason of the Applicant’s pregnancy.

[18] The Respondent also contends that there were no other vacancies in the business to which the Applicant could have been reasonably redeployed at the time. There were no other positions vacant in the immediate business, in which there had been some 9 redundancies other than the Applicant. Further, the evidence was that there were no vacant positions in the associated entity.

[19] The Applicant, however, felt aggrieved that there were casual employees employed in the business and she was of the view that given her salaried status she ought to have some call on those positions (which involved different tasks and duties at a lower classification). Alternatively, the Applicant suggested perhaps that those casual positions could have been abolished in preference to the retention of her customer service function.

CONSIDERATION

Section 389(1)(a) of the Act

[20] It appears to me that the Respondent was motivated to review the efficiency of its operations for commercial, and not other reasons. The evidence sufficiently demonstrates that the Respondent was motivated by an imperative to reduce numbers and to bring the Brisbane depot into alignment with the staffing profile in other state depots in the context of changing market and operational circumstances, which I have set out above.

[21] Mr Carr contends further that this resulted in an imperative to restructure the depots within the Respondent’s group and reduce the number of staff working in non-operational roles, as well as reducing the number of trucks and delivery drivers.

[22] To this end, Mr Carr gave evidence that a directive was put out to the Brisbane depot manager to provide a number of options for reducing staffing levels, and that Mr McCarthy gave effect to that directive following his deliberations at the ground level.

[23] Generally, the evidence which I have heard does not give me cause to question the genuineness of the Respondent’s claim to have been motivated to reduce staffing numbers for various commercial and operational reasons. The Applicant’s position was made redundant along with some 9 other employees around the same period in relation to the operational review commenced in February of 2012.

[24] It is not always the case that a redundancy is based upon a slowdown in work, as the Applicant’s position seems to presume. Commercial and operational changes may promote a reconfiguration in the way in which a business operates in order to reduce costs or to improve the efficiency of a business, regardless of the volume of work. In this instance, the mere fact the Certificate of Separation as completed referred to the redundancy as being for reason of a shortage of work takes the matter no further on the wider evidence.

[25] The Applicant's position also seems to presume that the position or job could only be made redundant if the duties performed in that position no longer needed to be performed whatsoever. However, this is not the case. It is the position or job that is no longer required, not necessarily the duties within that position or job. This means, as commonly occurs, that a volume of work may be redistributed across a team or workforce that allows for a number of other positions to be made redundant. See, as an example of judicial consideration of this proposition, the judgment of Ryan J in Jones v Department of Energy and Minerals (1995) 60 IR 304. Item 1548 of the Explanatory memorandum reflects this legal construction.

[26] The selection process used for identifying redundancies was explored in the course of the proceedings. The evidence as led was that the Respondent had traditionally applied a “last on first off” principle when it made its selection for redundancies.

[27] Thus, knowing that the Applicant was the last of the salaried full-time CSOs to be employed, and that the Applicant was to take leave and that no liability had been created in relation to any maternity leave obligations because of the short period of the Applicant’s employment, the Respondent identified the Applicant’s position for redundancy.

[28] It is a matter for the Applicant as to whether a claim may lay otherwise in relation to such decision-making. As it is, the issue of jurisdiction here on foot is unaffected by the reasons a particular employee is selected by the Respondent for redundancy. The plain words of the Act read in conjunction with Item 1553 of the Explanatory Memorandum (as cited above and highlighted) make this clear.

[29] The Applicant did suggest that when she was retained as a casual employee from June 2012, she did engage in duties that were the same as those which she had completed in her earlier position. The implication being that her job had not disappeared. But she appears to have performed these duties only until she was directed to do otherwise, as those duties were intended by the Respondent to be performed by the remaining CSOs (in accordance with the objective of the review). I do not think this has any bearing on the authenticity of the redundancy as I have discussed above.

[30] That all said, for the purposes of s.389(1)(a) of the Act the factual matrix revealed in the evidence demonstrates that the Respondent no longer required the Applicant’s job to be performed by anyone because of changes in the operational requirements of its business (driven by a review to rationalise operating costs). But for those operational changes, the Applicant's employment would have continued.

Section 389(1)(b) of the Act

[31] Section 389(1)(b) of the Act stipulates that a dismissal can only be a case of genuine redundancy if the Respondent had complied with any obligations in a modern award or enterprise agreement that applied to the employment of the Applicant to consult about the redundancy.

[32] It appears that the Respondent remains bound by a certified agreement made under the Workplace Relations Act 1996, which has not been replaced upon the passing of its nominal expiry date. That certified agreement operates to the comprehensive exclusion of any awards as set out in the definitions clause.

[33] Section 57 of the Act provides that a modern award does not apply to an employee where there is an enterprise agreement that applies to the employee’s employment. Section 57 of the Act reads as follows:

57 Interaction between modern awards and enterprise agreements

(1) A modern award does not apply to an employee in relation to particular employment at a time when an enterprise agreement applies to the employee in relation to that employment.

(2) If a modern award does not apply to an employee in relation to particular employment because of subsection (1), the award does not apply to an employer, or an employee organisation, in relation to the employee. [My emphasis]

[34] The certified agreement is an enterprise agreement for purposes of s.389(1)(b) of the Act. This is because an enterprise agreement is defined as including an agreement-based transitional instrument at item 36 of Schedule 3 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (“TPCA”) by way of the definitional provisions set out at Item 2 of the TPCA. The certified agreement is an agreement-based transitional instrument and therefore it is an enterprise agreement for the purposes of s.389(1)(b) of the Act.

[35] The consequence of this is that as the certified agreement that applies has no clause concerning consultation with employees in redundancy situations, no consultation obligations fall upon the Respondent.

Section 389(2) of the Act

[36] It appears to me also to be the case on the evidence that for the purposes of s.389(2) of the Act that the Applicant’s dismissal was a case of genuine redundancy because there were no other positions available at the time to which the Applicant could have been redeployed in the employer's enterprise or the enterprise of an associated entity of the employer. Given the commercial issues to which Mr Carr gave evidence, this is an unsurprising circumstance in respect of the Respondent's business. I have set the evidence out above in this respect.

[37] Mr Prescott’s evidence in relation to an associated entity that shared the premises was that, having set out the establishment as it was at the relevant time, no vacancies existed to which the Applicant could have been redeployed.

CONCLUSION

[38] In view of the above findings, the Applicant was made genuinely redundant for purposes of s.389 of the Act. As a consequence, the application under s.394 of the Act must be dismissed.

SENIOR DEPUTY PRESIDENT

Appearances:

Ms J. Anderson for herself

Mr C. Prescott for the Respondent

Hearing details:

2012.

22 October.

Brisbane.

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