Nicole Aleckson v Tewantin Noosa RSL and Citizens Memorial Club Inc

[2010] FWA 6452

[2010] FWA 6452

FAIR WORK AUSTRALIA

DECISION

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

Nicole Aleckson
v
Tewantin Noosa RSL & Citizens Memorial Club Inc.
(U2010/721)

COMMISSIONER MCKENNA SYDNEY, 30 AUGUST 2010

Application for an unfair dismissal remedy - genuine redundancy

[1] Nicole Aleckson (“the applicant”) has filed an application, pursuant to s.394 of the Fair Work Act 2009 (“the Act”), seeking an unfair dismissal remedy concerning her termination of employment by the Tewantin-Noosa RSL and Citizens Memorial Club Ltd (“the respondent”). The respondent objects to the application, contending the termination of employment was a genuine redundancy.

APPLICANT’S CASE

[2] The applicant had been employed by the respondent since August 2001 in a range of different positions, namely, Gaming Attendant, Cashier Attendant, Bar Attendant, TAB Attendant, Bistro Attendant, Supervisor and Duty Manager. In December 2008, the applicant was promoted to Human Resources Manager, but had not received any written confirmation relevant to matters including the position or requirements. The applicant said her Human Resources Manager role was performed in conjunction with the position of Duty Manager and Gaming Attendant; she described the time allocated to the different responsibilities. The applicant said she also regularly worked in areas such as the coffee shop, the bistro, the bar and gaming.

[3] The applicant returned from a period of annual leave on 19 April 2010. She spoke to the respondent’s Chief Executive Officer (“the CEO”) on 21 April 2010 and sent an email to him on 22 April 2010. The applicant was aware the Food and Beverage Manager’s position had been made redundant. On 24 April 2010, the applicant sent an email to the CEO asking if she was “out of a job” and, if that was the case, could he let her know as soon as possible so she could start looking for another job. The applicant did not receive a reply. The CEO was at the club premises on 25 April 2010. He did not discuss matters with the applicant but, she understands, another manager was informed that day of her impending termination of employment. On 26 April 2010, the applicant received an email from the CEO advising they “needed to talk”. On entering the meeting room, the applicant asked whether she had a job and the CEO replied she did not. Redeployment was not discussed or explored. The CEO stated to the applicant that the decision to restructure the management team had been made some two weeks earlier at a meeting of the respondent’s Board.

[4] The applicant said that as she was solely responsible for preparing the rosters, she had an intimate knowledge of positions and requirements at the club. However, restructuring had not been discussed with her and she was not asked whether there were any vacancies. The applicant said that as she was not notified of the impending termination, she did not have the opportunity to arrange representation for the meeting. The applicant was aware the Food and Beverage Manager had been “let go” before her own employment was terminated. The applicant understands the CEO had discussed the changes in the workplace with that manager, in a manner that was consistent with award-based consultation provisions. She disagreed with the submissions for the respondent that the consultation provisions of the Registered and Licensed Clubs Award 2010 (“the award”) did not apply to the circumstances of her termination of employment.

[5] The applicant said the respondent had promoted inexperienced employees to positions of Duty Manager and Supervisor, being positions into which she easily could have been redeployed. In effecting these promotions, the respondent also created vacancies to which she could have been redeployed, including Gaming Attendant, TAB Attendant and Bar Attendant. The applicant said the respondent had hired employees to fill positions since her termination of employment; she called on the respondent to “display records of employment for people employed after my dismissal”. The applicant said she would have been more than happy to fulfil any such positions, as it would have meant she would at least have had a job; and the positions were within the realm of her capabilities and experience. The applicant referred to the award as it concerns transfers to lower paid duties in circumstances of redundancy. She submitted the clause would not be in the award unless it was “valid for use”.

[6] The applicant said that prior to her termination of employment there were several managerial positions, namely, Chief Executive Officer, Food and Beverage Manager, Human Resources Manager, Functions Manager, Gaming Manager, Head Chef, Sous Chef and Financial Controller. The termination of the employment of the Head Chef, the Food and Beverage Manager and the Human Resources Manger resulted in changes in almost half the management team, constituting a major workplace change for both staff and management.

[7] The respondent had failed to provide a Statement of Duties to the applicant and she had not received anything in writing stating she had been dismissed and the reason for her dismissal. The applicant had, at the time of the hearing, only just recently found alternative employment.

RESPONDENT’S CASE

[8] Mr E Porter of Clubs Queensland advanced the respondent’s case as follows. On 25 March 2010, respondent’s Board decided to streamline its administration. The Board determined it no longer required the positions and duties of the Human Resources Manager and the Food and Beverage Manager to be performed by them or anyone and reallocated such duties. The human resources function was to be assumed by the CEO. The Board’s decision was conveyed to the CEO on 29 March 2010 for him to implement.

[9] The applicant was on annual leave from 19 March 2010 to 20 April 2010. While the applicant and the CEO spoke on 21 April 2010, the tenor of the conversation was such that the CEO deemed it inappropriate to discuss any workplace changes at that time. Moreover, it would have been impracticable for the CEO to reply to emails or discuss matters on the other dates referred to by the applicant; and a meeting that had been scheduled for 23 April 2010 did not eventuate.

[10] The CEO attempted to meet the applicant as soon as possible after her return from annual leave. A meeting occurred on 26 April 2010, which was planned as a structured meeting to discuss the decision taken by the Board. However, the manner in which the applicant approached the meeting meant a proper discussion could not ensue and the decision of the Board was duly conveyed to the applicant; the CEO informed the applicant that the Board considered it necessary to make the Human Resources Manager position redundant as a consequence of the proposed restructure and he was to assume the human resources requirements. The applicant was offered a deed of release similar to that which had been signed by the Food and Beverage Manager, but she refused to sign it stating she wanted more compensation. The respondent subsequently paid the applicant required notice and redundancy payments, and all other entitlements. Although the applicant claims she did not receive any communication in writing, the applicant was sent a letter on 27 April 2010 setting out the redundancy and enclosing pay slips.

[11] Despite the applicant’s contention she had been denied the opportunity to arrange representation, the applicant had sought representation from the Liquor, Hospitality and Miscellaneous Union. The CEO had been in communication with that union, by email and telephone, concerning the applicant’s leave entitlements and the question of redeployment (with advice there were no vacancies).

[12] Mr Porter submitted that the applicant’s primary position was Human Resources Manager and any other roles described by her were an adjunct to that primary role. The Board approves all full-time positions and no position has been offered to anyone, apart from in the kitchen and the new coffee shop. Moreover, no one has been employed to take over the redundant positions.

[13] There were no vacancies at the time of the applicant’s termination of employment. Although the applicant claims she could have been redeployed to positions of Gaming Attendant, TAB Attendant and Bar Attendant which have been filled since her redundancy, the only engagements for one month after the applicant’s redundancy have been six kitchen casuals; one bistro floor casual; one security casual; one full-time and one casual coffee shop employee; and one casual bar attendant. Moreover, although the applicant claimed that almost half the managerial team changed in the wake of the restructure, the Head Chef and Sous Chef are not part of the management team; and, in any event, their employment had terminated for reasons other than redundancy.

[14] Mr Porter submitted that when looking at any change to operational requirements, the overall effect on the business is to be considered rather than one small portion. The decision of the Board to change the operational requirements was, Mr Porter submitted, in accordance with s.389(1)(a) of the Act. While s.389(1)(b) requires certain consultation for a termination of employment to be regarded as a genuine redundancy, the decision by the Board could not be regarded as a “major” workplace change such as to invoke the consultation provisions of cl.8 of the award. The change involved the redundancies of two employees out of 77 - or 2.6 per cent - and thus could not be considered to constitute a major change: National Tertiary Education Industry Union v University of Adelaide (Print T2282). Redundancy for an employee may be a major issue for that person but it does not follow, he submitted, it is a major organisational change. Mr Porter referred also to the dictionary meaning of “major”; managerial prerogatives concerning redundancies; and the Explanatory Memorandum to the legislation as it concerns genuine redundancy.

[15] In summary, Mr Porter submitted the termination of the applicant’s employment was a genuine redundancy because: the action taken by the Board did not constitute a major change in the operational requirements of the respondent, and there was no requirement to consult about the decision; the respondent attempted to consult with the applicant as soon as possible after the decision was made, and a meeting was held on 26 April 2010; consideration was given to redeployment, but there was no position vacant into which the applicant could have been deployed.

GENUINE REDUNDANCY

[16] Section 396 of the Act provides that Fair Work Australia must decide certain matters relating to an application before considering the merits of the application, including whether the dismissal was a case of genuine redundancy - which is given definition in s.389 of the Act. I turn to those matters.

[17] Section 389(1)(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: The applicant indicated that the Human Resources Manager position was undertaken in conjunction with the position of Duty Manager and Gaming Attendant. The applicant described this as follows: “Time allocated to administration hours of human resources was one full administration day per week, one day allocated to two hours gaming and six hours administration and one part day administration (total 20 hours)”.On the other hand, Mr Porter submitted the applicant’s primary position was Human Resources Manager and that any other roles were an adjunct to enable her to fulfil the human resources management role.

[18] The applicant’s former position of Human Resources Manager no longer exists, with human resources responsibilities within the club now being assumed by the CEO, consequent upon the decision of the Board to restructure its operations in this respect. It is unclear, in circumstances where the human resources function still existed, but was to be assumed by the CEO, whether, strictly speaking, it could be said that “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”. It is also unclear whether only the human resources aspect of the position has been absorbed by the CEO. Responsibilities as a Duty Manager and Gaming Attendant do not necessarily seem to be an adjunct to a position of Human Resources Manager, and it is unclear whether those roles are no longer required to be performed by anyone because of changes in the respondent’s operational requirements.

[19] While there may be some doubt about whether it could strictly be said the respondent no longer required the person’s job to be performed by anyone, I think it may be accepted the functions the applicant formerly performed have been redistributed in the manner such as that contemplated in Item 1548 of the Explanatory Memorandum, with the result that the applicant’s former position no longer exists. In that sense, I think it can be concluded that in this matter “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”.

[20] Section 389(1)(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: It is common ground the award applied to the applicant’s employment and cl.8 of the award contains standard consultation provisions. Despite the submissions by Mr Porter, I consider the consultation provisions of the award were engaged once the respondent’s Board determined to effect a restructure that contemplated terminations of employment by redundancy. It seems to me a restructure which would have as its outcome the abolition of positions, resulting in termination of employment by redundancy, may be considered to constitute major change within the meaning of cl.8.1 of the award. If a restructure involves proposed job losses, it seems to me to be almost axiomatic that the consultation provisions of the award would be activated, even if the number of employees whose employment is proposed to be terminated by redundancy as part of the restructure is numerically or statistically small. Moreover, cl.8.1(b) of the award provides that “Significant effects include termination of employment”, without any qualifying words concerning numbers or percentages.

[21] Here, the respondent did not notify or discuss in accordance with cl.8 of the award. Hence, the respondent has not complied with any obligation in a modern award that applied to the employment to consult about the redundancy.

[22] Section 389(2)(a) - 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 the employer’s enterprise: Prior to her promotion to the position of Human Resources Manager (including Duty Manager and Gaming Attendant responsibilities), the applicant had worked in a variety of other positions. The applicant said the respondent had promoted employees to positions of Duty Manager and Supervisor, being positions into which she easily could have been permanently redeployed - albeit the dates or dates on which these appointments had been made was unclear. In effecting these promotions, the respondent also created vacancies to which the applicant considers she could have been redeployed, including Gaming Attendant, TAB Attendant and Bar Attendant. The applicant was also performing work around lunch-times in the coffee shop, bistro, bar and in gaming. The applicant said she would have been “more than happy” to undertake any position because she would at least have had a job and she had relevant capabilities and experience at the club.

[23] The respondent’s case contended that consideration had been given to redeploying the applicant, but there was no position vacant to which the applicant could have been redeployed. The only engagements for one month after the applicant’s termination of employment were six kitchen casuals; one bistro floor casual; one security casual; one full-time coffee shop employee; one casual coffee shop employee; and one casual bar attendant.

[24] Considering the applicant’s long-term and more recent experience in a variety of roles, coupled with the respondent’s recruitment of so many new employees within a period so proximate to the applicant’s termination of employment, I consider it would have been reasonable in all the circumstances for the applicant to be offered redeployment within the club. However, there were no discussions with the applicant about any such potential redeployment.

HARSH, UNJUST OR UNREASONABLE

[25] There are certain matters Fair Work Australia must take into account in considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, as specified in s.387 of the Act. These matters are considered below.

[26] Section 387(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): There was nothing to suggest this termination of employment related to the applicant’s capacity or conduct.

[27] Section 387(b) - Whether the person was notified of that reason: The decision to terminate the applicant’s employment was made by the respondent’s Board on 25 March 2010 and conveyed to the CEO on 29 March 2010 for implementation. The applicant was informed of the Board’s decision on 26 April 2010.

[28] Section 387(c) - Whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person: There was nothing to suggest this termination of employment related to the applicant’s capacity or conduct and, as such, the opportunity to respond to capacity-related or conduct-related issues does not arise.

[29] Section 387(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: Although the applicant considered she effectively had been denied the opportunity to organise representation in circumstances where she had not been given advice about the purpose of the meeting (the applicant had received an email from the CEO advising only that they “needed to talk”), I would not conclude there had been an unreasonable refusal by the respondent to allow the applicant to have a support person present to assist at the meeting on 26 April 2010. That is, there was nothing to suggest the applicant had asked for assistance, but there had been an unreasonable refusal. The respondent’s case also contended the CEO had been in communication with the LHMU, but that was obviously after the advice about the termination of employment had been communicated, given that the contact was about matters such as leave entitlements and redeployment.

[30] Section 387(e) - If the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal: There is nothing to suggest the dismissal related to unsatisfactory performance by the applicant and, hence, no issues arise about prior warning of unsatisfactory performance.

[31] Section 387(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: It appears there were 77 employees, a not insignificantly-sized enterprise - but there was nothing advanced by either party as to any impact this may have had on the procedures followed in effecting the termination of employment, save as to the submissions by Mr Porter about whether the restructure constituted a major change.

[32] Section 387(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: Here it was the applicant herself who was the Human Resources Manager, and part of her complaint relates to the procedures followed by the respondent in effecting the termination of employment. She understood the Food and Beverage Manager had, consistently with award-based obligations, been consulted. She also said that although she was solely responsible for drafting the rosters and had an intimate knowledge of positions and requirements, restructuring was not discussed with her and no question was raised with her concerning vacant positions. It may be the case that the absence of human resources expertise by the CEO impacted on the procedures followed by the respondent.

[33] Section 387(h) - Any other matters that FWA considers relevant: The matters are considered below.

CONCLUSION

[34] The Board made a definite decision to terminate the applicant’s employment on 25 March 2010, whereas the applicant was not informed of the decision until 26 April 2010. It is unclear why the decision was not communicated to the applicant by letter, telephone call or email prior to her return from annual leave. Even if there had been some potential for difficulty in communicating the decision prior to the applicant’s return from annual leave, it might reasonably be expected the applicant should have been informed of the decision on the first day of her return - whether in person, by letter, telephone call or by email. The applicant was obviously concerned about her continued employment in circumstances where she knew another managerial employee’s employment had been terminated and was endeavouring to seek information about her own status - but she was left without relevant information.

[35] The termination of the applicant’s employment could not be characterised as a genuine redundancy, when considered in the context of s.389 of the Act. I consider cl.8 of the award was engaged in the circumstances of this restructure involving, as it did, terminations of employment. The Board’s decision of 25 March 2010 was communicated to the applicant on 26 April 2010, the day the termination took effect. Here, the respondent did not consult in the manner contemplated in the modern award.

[36] A failure to observe award-specified provisions concerning consultation may be a relevant consideration in determining whether a dismissal was harsh, unjust or unreasonable; so much seems to be evinced by the provisions of s.389(1)(b) of the Act as it concerns the meaning of genuine redundancy. It is well-established that even if a termination of employment was a redundancy, the characteristics of the redundancy may otherwise attract review by courts and tribunals: Australian Iron and Steel v Banovic & Ors [1989] HCA 56; (1989) HCA 56. Moreover, it is also well-established in industrial jurisprudence that a termination of employment may amount to both a redundancy and an unfair dismissal: Outboard World Pty Ltd v Muir (1993) 51 IR 167 at 180; [1993] NSWIRComm 93. Further, a failure to comply with award-based requirements may also quite independently of other factors render a dismissal unfair: Rich River Golf Club v Power [1995] NSWIRComm 75 (Full Bench of the Industrial Relations Commission of New South Wales per Fisher P, Hill J and Redman CC). As the Full Bench of the Industrial Relations Commission of New South Wales said in Outboard World:

“In relation to that question the defence of the appellant includes the proposition that the former employee's position was redundant and thus incapable of constituting a dismissal of the kind with which [Chapter 3 Part 8 of the Industrial Relations Act 1991 ((NSW)) is concerned.

We consider that submission to be untenable. While in the ordinary case it may be that a redundancy genuinely occurring would not come within the parameters of Part 8, Unfair Dismissals, it takes little imagination to apprehend a situation which is both a redundancy and a harsh, unreasonable or unjust dismissal.”

[37] Had the respondent consulted in accordance with the obligation in the award, such discussions may have had the effect of minimising the adverse effects of the Board’s decision on the applicant. That is, the applicant and the respondent would have had the opportunity to explore the possibility of redeployment within the club during the period from the date when the definite decision was made to the date of termination of employment on 26 April 2010. Had the decision been communicated to the applicant on or around 25 March 2010 or even on her return from annual leave, it would also have allowed the applicant a longer period of time to seek alternative employment beyond the club. In this respect, it may be noted the applicant had, around the time of the hearing on 20 August 2010, then only recently obtained alternative employment.

[38] Putting aside the failure to meet the award-based obligations concerning consultation that I have concluded applied in this case, the manner in which the termination of employment was effected was, in a broader industrial sense, regrettable. That is, the applicant had been employed by the respondent since 2001. She had worked her way up from base ranks until her promotion to Human Resources Manager. The respondent had been aware since 25 March 2010 its restructure would definitely result in the redundancy of the applicant’s position. Even if there was no award-based consultation requirement, one might reasonably expect that a long-standing employee who was presumably well-considered, given her history of commendations and promotions since 2001 from casual Gaming Attendant to a managerial position, would have been afforded better process in terms of consultation and advice than was afforded by the respondent, more particularly when this was afforded to the other employee who was made redundant. The applicant was not even given so much as a statement of service on termination of employment to assist her in seeking alternative employment. (I should note that some of the factual disputes about the timing of matters and the like could not be determined in the usual way, given the way the cases were advanced. That is, the applicant was not cross-examined and the respondent proceeded, without objection from the applicant, on the basis only of submissions. Disputed emails and correspondence were not submitted by the parties as part of their respective cases. However, those matters concerning the sequence of events which are common ground or undisputed generally allow the conclusions I have reached, without the need to determine contested matters of fact.)

[39] If, however, I am wrong in my conclusion in relation to Mr Porter’s submission that the award’s consultation provisions were not engaged in this matter, the termination of employment could not otherwise be considered to be 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. In this respect, the provisions of s.389(2) of the Act do not appear to be conditioned by s.389(1); they raise discrete considerations as to whether a termination of employment may be characterised as a genuine redundancy.

[40] The applicant was aware that other employees had been promoted into positions of Duty Manager and Supervisor, whom she considered to be less-experienced than herself. While accepting that promotions may occur during a management restructure, the applicant understood these promotions had created other vacancies; and that the respondent had recruited new employees since her termination of employment. She referred also to the provisions of cl.14.2 of the award, concerning transfer to lower paid duties - submitting the provision must have some work to do in circumstances such as hers. The applicant said she would have been happy to fill any positions for which she had relevant experience on the basis that she would then at least have had a job. The respondent’s submissions confirmed that in the month after the termination of the applicant’s employment, it had relevantly recruited six casual employees for the kitchen, one casual employee for the bistro floor, one full-time employee for the coffee shop, one casual employee for the coffee shop and one casual employee as a bar attendant. While the respondent contended there were no positions available at the time of the termination of the applicant’s employment, the proximity in time of these new recruitments strongly suggests redeployment would have been both available and reasonable in all the circumstances. To the date of her termination of employment, the applicant routinely had been performing work “in all areas” of the type that new employees had been recruited to perform; and she would have preferred to have any job for which she was experienced rather than be unemployed.

[41] If ever there was a case where redeployment would seem to have been reasonable in all the circumstances, this seems to be one such example given the roles the applicant was performing to the time of her termination of employment. The applicant performed human resources management responsibilities for about twenty hours each week. The balance of her time was spent performing Duty Manager and Gaming Attendant responsibilities, as well as undertaking work at lunch-times on the club floor in the coffee shop, the bistro, the bar and gaming; and new employees were recruited to perform such roles within a month following her termination of employment, in circumstances where the applicant would have preferred to have any form of ongoing employment to unemployment.

[42] For the reasons outlined earlier in this decision, the characteristics of the way in which this termination of employment was effected take it out of the area of genuine redundancy and into that of a harsh, unjust and unreasonable dismissal. The applicant was a long-standing employee of the respondent and she was, in my assessment, treated harshly, unjustly and unreasonably in terms of lack of proper or reasonable process concerning matters such as consultation and potential redeployment in connection with the redundancy of her position. I consider the applicant should have an order in her favour in that respect.

[43] Given the applicant has recently obtained a new job and reinstatement is not being sought as a remedy, I am satisfied, pursuant to s.390(3)(a) of the Act, that reinstatement is inappropriate. I further consider, pursuant to s.390(3)(b), that an order for compensation is appropriate in all the circumstances of this case. The relief the applicant seeks is fair compensation reflecting the time it would have taken the respondent to observe and adopt a fair process, including meeting consultation obligations.

[44] The decision to terminate the applicant’s employment had been made on 25 March 2010 and conveyed to the CEO on 29 March 2010, for him to implement. The applicant should have been advised of the definite decision about her termination of employment on or soon after 29 March 2010. This would have allowed her a longer period to seek alternative employment. If it was, for reasons associated with the applicant’s annual leave, impracticable to provide such advice (although there was nothing to suggest it would have been impracticable or that attempts had been made to contact the applicant while she was on leave), she should have been promptly advised on her return from leave.

[45] The advice of termination of employment was peremptorily communicated to the applicant on 26 April 2010 and her employment was terminated that day. I consider that the time from the date the definite decision was communicated to the CEO to the time the dismissal was effected would have been reasonable to allow the fair processes described by the applicant to be adopted. As such, I consider the applicant should have an order for compensation in an amount equal to the ordinary earnings she would have received during the period from 29 March 2010 to 26 April 2010. I have taken into account the matters in s.392 of the Act on the limited information available in the parties’ case in determining the amount of compensation including, pursuant to s.392(2)(g) of the Act, that the applicant has been paid redundancy and notice payments.

[46] I also recommend that the applicant be provided with the statement of service she had requested.

[47] An order has been issued in conjunction with the publication of this decision.

COMMISSIONER

Appearances:

N. Aleckson on her own behalf.

E. Porter, Clubs Queensland, for the respondent.

Hearing details:

Brisbane

2010

August 20.

Printed by authority of the Commonwealth Government Printer

<Price code C, PR500845>