DECISION

Fair Work Act 2009
s.120 - Application to vary redundancy pay for other employment or incapacity to pay

Nortel Pty Ltd
(C2019/13)

COMMISSIONER HAMPTON

ADELAIDE, 14 MARCH 2019

Application for variation of redundancy pay – position redundant and employee dismissed on that basis – NES redundancy payments due - whether acceptable alternative employment obtained – employee offered continuing employment with applicant employer in different roles – approach to acceptable employment considered and applied – one of two alternative positions objectively acceptable – discretion exercised to reduce the redundancy payments.

1. Background and case outline

[1] Nortel Pty Ltd (Nortel) has made application pursuant to s.120 of the Fair Work Act 2009 (the FW Act) seeking a reduction in the redundancy pay otherwise due to its employee; Ms Melissa Westover.

[2] Nortel conducts retail outlets on behalf of Telstra from a small administrative head office and at 5 retail outlets in the suburbs of Adelaide.

[3] It is common ground that Ms Westover has now been made redundant 1 and been offered alternative employment in a number of positions with Nortel.

[4] At all relevant times the employment of Ms Westover was covered by the General Retail Award 2010 (the Award). The Award provides that the redundancy entitlements are as established by the National Employment Standards (NES) of the FW Act.

[5] The application therefore relates to the redundancy payments provided by s.119 of the FW Act, which are established in the following terms:

“119 Redundancy pay

Entitlement to redundancy pay

(1) An employee is entitled to be paid redundancy pay by the employer if the employee’s employment is terminated:

(a) at the employer’s initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or

(b) because of the insolvency or bankruptcy of the employer.

Note: Sections 121, 122 and 123 describe situations in which the employee does not have this entitlement.”

Amount of redundancy pay

(2) The amount of the redundancy pay equals the total amount payable to the employee for the redundancy pay period worked out using the following table at the employee’s base rate of pay for his or her ordinary hours of work:

Redundancy pay period
Employee’s period of continuous service with the employer on termination	Redundancy pay period
1	At least 1 year but less than 2 years	4 weeks
2	At least 2 years but less than 3 years	6 weeks
3	At least 3 years but less than 4 years	7 weeks
4	At least 4 years but less than 5 years	8 weeks
5	At least 5 years but less than 6 years	10 weeks
6	At least 6 years but less than 7 years	11 weeks
7	At least 7 years but less than 8 years	13 weeks
8	At least 8 years but less than 9 years	14 weeks
9	At least…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Nortel Pty Ltd

Details

AGLC: Nortel Pty Ltd [2019] FWC 1084
Case: [2019] FWC 1084
Decision Date: 14 MARCH 2019

CaseChat Overview and Summary

Nortel Pty Ltd was the subject of an application brought by an employee who sought a variation of their redundancy payments. The dispute arose following the employee's dismissal on the basis of redundancy. The case was heard in the Fair Work Commission, the body responsible for resolving employment-related disputes in Australia. The primary concern was whether the employee had obtained acceptable alternative employment, which would have implications for the amount of National Employment Standards (NES) redundancy payments due.

The legal issue before the Commission was whether the employee had obtained acceptable alternative employment, as defined under the Fair Work Act 2009. The Commission was required to consider the nature of the alternative employment offered to the employee, specifically if it was objectively acceptable. This involved evaluating the suitability of the alternative positions offered by the applicant employer in terms of remuneration, hours, and duties. The Commission needed to determine whether the alternative employment met the criteria for being considered acceptable under the NES, which would impact the quantum of the redundancy payments.

The Commission found that the applicant employer had offered the employee two alternative positions. After careful consideration, the Commission concluded that one of the two positions was objectively acceptable. The decision hinged on the specific characteristics of the acceptable position, including its similarity to the employee's previous role, the remuneration offered, and the conditions of employment. The Commission exercised its discretion under the NES to reduce the redundancy payments in light of the acceptable alternative employment. This decision was based on the balance of fairness and the legislative framework governing redundancy payments in Australia.

The Fair Work Commission ordered that the redundancy payments due to the employee be reduced in accordance with the findings. The reduction was based on the availability of acceptable alternative employment and the specific circumstances of the case as evaluated by the Commission. This outcome reflects the Commission's role in ensuring that redundancy payments are adjusted in cases where acceptable alternative employment is offered, thereby balancing the interests of both the employee and the employer.

Orders