Port Kembla Coal Terminal Ltd v Construction, Forestry, Mining and Energy Union
[2016] FCAFC 99
•5 August 2016
FEDERAL COURT OF AUSTRALIA
Port Kembla Coal Terminal Ltd v Construction, Forestry, Mining and Energy Union [2016] FCAFC 99
Appeal from: Construction, Forestry, Mining and Energy Union v Port Kembla Coal Terminal Ltd (No 3) [2015] FCA 1278 File number: NSD 1431 of 2015 Judges: JESSUP, RANGIAH AND WHITE JJ Date of judgment: 5 August 2016 Catchwords: INDUSTRIAL LAW – Redundancy – Agreement clause requiring recourse to “redeployment and voluntary redundancy” – Whether employer obliged to offer redundancy separation to employees whose positions continued to exist – Agreement clause requiring investigation of “all avenues to avoid forced redundancies, including the reduction of contractors” – Whether confined to contractors engaged on full‑time, permanent, basis – Whether employer had undertaken investigation.
INDUSTRIAL LAW – Obligation to consult where introduction of “change” being considered – Whether change was “major” – Whether introduction of change being “considered” – Potential impact of change on dayworkers – Whether employed on day shift – Whether “a change to the numbers of employees per shift.”
INDUSTRIAL LAW – Adverse action – Dismissed of employee – Whether done because of employee’s position as officer of trade union or his having engaged in industrial activity – Reasons of decision‑maker – Onus of proof – Credibility of witness.
EVIDENCE – Credibility of witnesses – Witnesses’ evidence rejected for reasons which included their failure to refer, in their affidavits, to documents and facts which were unhelpful to their case – Whether they testified that their affidavits were comprehensive – Whether they were given sufficient warning that their omissions might result in the rejection of their evidence.
INDUSTRIAL LAW – Remedies – Reinstatement – Whether available where position previously occupied no longer existed.
Legislation: Evidence Act 1995 (Cth) s 140
Fair Work Act 2009 (Cth) ss 50, 340, 341, 342, 346, 347, 360, 361, 385, 389, 545, 550
Federal Court of Australia Act 1976 (Cth) ss 24, 28
Cases cited: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27
Amcor Ltd v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241
Blackadder v Ramsey Butchering Services Pty Ltd (2002) 118 FCR 395
Blackadder v Ramsey Butchering Services Pty Ltd (2005) 221 CLR 539
Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500
Briginshaw v Briginshaw (1938) 60 CLR 336
Browne v Dunn (1893) 6 R 67
Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v QR Limited [2010] FCA 591
Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Australian Competition and Consumer Commission (2007) 162 FCR 466
Conway v R (2002) 209 CLR 203
Director-General, Department of Health (NSW) v NSW Nurses’ Association (2011) 209 IR 49
Driclad Pty Ltd v Commissioner of Taxation (1968) 121 CLR 45
Finance Sector Union of Australia v Commonwealth Bank of Australia (2001) 111 IR 241
Jones v Dunkel (1959) 101 CLR 298
Kucks v CSR Limited (1996) 66 IR 182
Kuhl v Zurich Financial Services Australia Ltd (2011) 243 CLR 361
National Tertiary Education Union v La Trobe University [2014] FCA 1330
Short v FW Hercus Pty Ltd (1993) 40 FCR 511
Termination, Change and Redundancy Case (1984) 294 CAR 175; 8 IR 34
Termination, Change and Redundancy Case (1984) 295 CAR 673; 9 IR 115
Transport Workers’ Union of Australia v Linfox Australia Pty Ltd (2014) 318 ALR 54
Weeks v Federal Commissioner of Taxation (2013) 209 FCR 264
Weiss v R (2005) 224 CLR 300
Windoval Pty Ltd v Donnelly (2014) 226 FCR 89
Yorke v Lucas (1985) 158 CLR 661
Date of hearing: 22-23 February 2016 Registry: New South Wales Division: Fair Work Division National Practice Area: Employment & Industrial Relations Category: Catchwords Number of paragraphs: 573 Counsel for the Appellants: Mr R Kenzie QC with Mr S E J Prince Solicitor for the Appellants: Ashurst Counsel for the Respondents: Ms C Howell with Ms L Doust Solicitor for the Respondents: Slater & Gordon
Table of Corrections 6 September 2016 In the second sentence of paragraph 506, the word “to” has been inserted between the words “prior” and “a”. 6 September 2016 In the second sentence of paragraph 553, the word “in” between the words “in” and “relation” has been deleted. 6 September 2016 In the second sentence of paragraph 555, an apostrophe has been inserted at the end of the second mentioned word “contractors”. It now reads as “contractors’”. 6 September 2016 In the second sentence of paragraph 555, the word “made” has been inserted between the words “had” and “the”. 6 September 2016 In paragraph 556, the word “the” between the words “of” and “Mr” has been deleted. 6 September 2016 In the last sentence of paragraph 567, the word “carry” has been replaced with “carries”. ORDERS
NSD 1431 of 2015 BETWEEN: PORT KEMBLA COAL TERMINAL LTD
First Appellant
PETER GREEN
Second Appellant
AND: CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION
First Respondent
ADAM GIDDINGS
Second Respondent
JASON ROSEWARN (and another named in the Schedule)
Third Respondent
JUDGES:
JESSUP, RANGIAH AND WHITE JJ
DATE OF ORDER:
5 AUGUST 2016
THE COURT ORDERS THAT:
1.Leave to appeal be granted.
2.The appeal be allowed in part.
3.The primary Judge’s determination that the first appellant contravened s 50 of the Fair Work Act 2009 (Cth) by contravening cl 7 of the Port Kembla Coal Terminal Limited Enterprise Agreement 2012-2015 be set aside.
4.The respondents’ claim that the first appellant contravened s 50 of the Fair Work Act 2009 (Cth) by contravening cl 7 of the said agreement be dismissed.
5.The primary Judge’s determination of the respondents’ claims under ss 340 and 346 of the Fair Work Act 2009 (Cth) be set aside.
6.There be a new trial of the said claims under ss 340 and 346 of the Fair Work Act 2009 (Cth) before a differently-constituted court.
7.Otherwise, the appeal be dismissed.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
JESSUP J:
This is an application for leave to appeal and, provisionally upon the grant of leave, an appeal, from orders made by a single Judge of the court on 16 November 2015 in favour of the respondents, Construction, Forestry, Mining and Energy Union (“the Union”), Adam John Giddings, Jason Rosewarn and Jennifer Arber in a proceeding brought by them against the appellants, Port Kembla Coal Terminal Ltd (“the Company”) and Peter Green. In that proceeding, the respondents alleged that the Company had contravened s 50 of the Fair Work Act 2009 (Cth) (“the FW Act”) by contravening certain terms of the Port Kembla Coal Terminal Limited Enterprise Agreement 2012-2015 (“the Agreement”), that the Company had contravened ss 340 and 346 of the FW Act by terminating the employment of Mr Giddings, and that Mr Green was likewise liable for the contraventions of ss 340 and 346 as an accessory pursuant to s 550 of the FW Act.
In his orders of 16 November 2015, the primary Judge gave effect, in part, to an earlier decision, published on 8 October 2015, in which he upheld significant aspects of the now respondents’ claims, but he reserved for further consideration other heads of relief which had been sought. Because his Honour’s orders were, in this respect, interlocutory, leave to appeal is required under s 24(1A) of the Federal Court of Australia Act 1976 (Cth) (“the Federal Court Act”). The decision of 8 October 2015, however, finally determined the rights and wrongs of the case at a high level, and the respondents do not resist the grant of leave to appeal to the extent of grounds of appeal that were developed in the applicants’ written submissions filed before the hearing of the present application. In the circumstances, I consider that leave to appeal should be granted. Henceforth in these reasons, I shall refer to this proceeding as an appeal, and to the applicants as the appellants.
THE FACTS IN OUTLINE
What follows in this part of my reasons is based substantially on findings made by the primary Judge.
The Company, which is owned by a consortium of six coal producers, operates the coal terminal at Port Kembla. As at February 2015, the Company had about 98 full time equivalent employees. Mr Green was the General Manager at the terminal, albeit that he was employed by a company associated with one of the consortium members. Until the termination of their employments in circumstances which led to the proceeding before the primary Judge, Mr Giddings was employed by the Company in the position of Long Term Planner, Mr Rosewarn was so employed in the position of Facilities Maintenance Engineer and Ms Arber was so employed as an Administration Assistant. They were all members of the Union, and Mr Giddings was president of the Port Kembla Coal Terminal Lodge (“the Lodge”).
In his reasons of 8 October 2015, the primary Judge explained that deteriorating business conditions in the coal industry in the years leading to 2014 caused the Company to abandon what had, in May 2011, been a project to upgrade the infrastructure and facilities at the terminal. However, earlier reports on the condition of plant and equipment at the terminal had highlighted the extent of the backlog of maintenance and restoration work that was required. The scale and complexity of this work was beyond routine repair and maintenance activities, and it was decided to undertake the necessary work by way of a dedicated project team. At the times which became relevant in the proceeding before his Honour, there were about 50 contractors engaged on this project work, in addition to 5-15 contractors who were performing non-project work at the terminal.
In March 2014, Mr Green announced an operational review of the Company’s business. John Gorman, the Operations Manager of the Company (albeit that he too, like Mr Green, was employed by a company associated with one of the consortium members) had been on secondment to another business within the same group. Upon his return to the Company in April 2014, Mr Green asked him to work on that operational review. Mr Gorman did so, and it was not until July 2014 that he returned to his responsibilities as Operations Manager. It was, accordingly, Mr Gorman who carried out much of the early work on the review. Through April, May, June and July 2014, Mr Gorman kept Mr Green informed about how the operational review was progressing, in part through regular fortnightly meetings.
The purpose of the operational review was to identify ways in which the Company could achieve efficiencies and savings to reduce costs, including consideration of whether there were any activities that could be done differently, and whether there were any positions within the Company that were no longer needed. The primary Judge found that, in conducting the operational review, and in considering a reduction in manning levels through the abolition of positions, the Company was engaged in “a bona fide attempt to reduce its costs”.
The primary Judge found that the operational review was conducted in two “phases”. The initiatives in Phase 1 included taking up an existing proposal to reduce shift team members (which involved the transfer of two employees from each shift team back to day work groups), a proposed freeze on wage increases under the Agreement, and a proposed 12-month suspension of the annual increases to grades under the Agreement. Mr Green accepted Mr Gorman’s recommendations in these respects. The shift team members were reduced by two and, in July 2014, Mr Green sought, but did not secure, the employees’ agreement to a wage freeze and to a 12-month suspension on the regrading of positions.
Phase 2 of the operational review involved a review of day work support and functional roles in order to identify cost reductions and efficiencies, including considering whether there were any positions which were surplus, or the duties of which could be re-distributed amongst the current workforce. In this part of the review, Mr Gorman spoke to relevant managers, including the Engineering Manager Roger Stewardson, the Business Services Manager Flavio Tonini and the Human Resources Manager Briony Ragen, to determine whether reducing the number of positions in their teams was feasible. It is apparent from the reasons of the primary Judge that, over the period May-July 2014, each of these managers was giving his or her own attention to the matters that were of interest to Mr Gorman. To an extent, these streams of activity appear to have been proceeding in parallel, and any attempt to impress upon them a precise chronological order would have been unproductive, and was not attempted by the primary Judge. But, because the positions occupied by Mr Giddings and Mr Rosewarn came within Mr Stewardson’s area of responsibility, the latter’s involvement in the review, and his contact with Mr Gorman, were of particular interest to the primary Judge. He found that Mr Stewardson had several discussions with Mr Gorman in the period referred to.
On 16 April 2014, Mr Stewardson informed Ms Ragen of some preliminary ideas which he had as to roles in the engineering team that could be consolidated. He attached two documents he had prepared, titled “PKCT Organisational Chart 12.5M” and “Organisational Redesign Stage 2”. The primary Judge noted that, in these documents, Mr Stewardson proposed the abolition of seven engineering positions, including the Long Term Planner and Facilities Maintenance Engineer positions occupied by Mr Giddings and Mr Rosewarn respectively. He described this proposal as a “work in progress” and probably a “stretch target”, but said that it could be passed on to Mr Gorman. Following a meeting with Mr Gorman and Ms Ragen on 2 May 2014, Mr Stewardson advised that it might be possible for the engineering team to work without three Technical Officers positions, two Project Officer positions, and the Long Term Planner and Facilities Maintenance Engineer positions.
On 23 May 2014, Mr Gorman, Mr Stewardson and Ms Ragen met to consider a detailed PowerPoint presentation prepared by the latter titled “Operational Review - May 2014”. Ms Ragen proposed the abolition of a number of positions, including the positions of Long Term Planner and Facilities Maintenance Engineer, and one Administration Assistant position. The primary Judge noted that Ms Ragen’s presentation “tends to show that Ms Ragen thought that affected employees could be redeployed into work undertaken by contractors engaged by [the Company], including that Mr Giddings could be redeployed to the ‘MTEC [Manuals, Training, Engineering, Commissioning] position’.”
On 3 June 2014, Mr Gorman and Ms Ragen met with Mr Tonini to discuss, amongst other things, whether cost savings could be found in the finance/administration team. In this meeting, Mr Tonini said that there was scope to reduce positions in his team.
Also on 3 June 2014, Mr Gorman prepared a document titled “PKCT Operational Review summary paper” in which he outlined his preliminary thoughts on labour cost savings and identified the possibility of abolishing seven positions. The primary Judge noted that, in this document, Mr Gorman “approached the proposed abolition of positions on the basis that the Agreement required that offers of voluntary redundancy be made to other employees before forced redundancies were implemented”, citing the following items under the heading “Process/EA Compliance”:
ŸCan we focus on a subset of the PKCT Employee group?
ŸWho must VR’s [sic] be offered to? Can it just be a subset of the PKCT Employee group?
ŸOn what grounds can we rejected [sic] a VR request? Cost savings? Retirement likelihood?
The primary Judge also found that, “in May or June 2014”, Mr Gorman prepared a document titled “Review of the obligations regarding workforce reductions”, in which he summarised the Company’s obligations under the Agreement in the context of the proposed abolition of positions and commented on how the Company could adhere to its obligations. His Honour noted that this document “tend[ed] to show that Mr Gorman understood the Agreement to require [the Company] to offer redeployment and voluntary redundancies before implementing forced redundancies and to investigate all avenues to avoid forced redundancies, including by reducing contractors” and that “he thought that there were avenues potentially available to avoid the forced redundancies of Mr Giddings and Mr Rosewarn.”
In June 2014, Mr Gorman prepared a detailed spreadsheet titled “Scenario Planner”, in which he set out the positions that would be abolished under various scenarios, identifying the affected employees by name. The spreadsheet set out the age, length of service, cost of redundancy, and job swap and redeployment options in respect of 15 positions, including those of Mr Giddings, Mr Rosewarn and two Administration Assistants. The primary Judge noted that this spreadsheet “tend[ed] to show that [Mr Gorman] understood the Agreement to require [the Company] to offer voluntary redundancies and to redeploy affected employees into contractors’ work before forced redundancies could be implemented”, that “Mr Giddings could potentially be redeployed into a number of positions within [the Company] (if they became vacant through offers of voluntary redundancy) or into a number of contractor roles, and that Mr Rosewarn could potentially be redeployed into the position of Services Planner within [the Company] (if that became vacant through voluntary redundancy) or into the Project Supervisor contractor role” and that “an affected Administration Assistant could potentially be redeployed into a contractor role of Secretary/Personal Assistant within the ‘Project/Non-EA’ area.”
By late June 2014, Mr Gorman had arrived at the view that, other than in the case of the Administration Assistants, the Company should not offer voluntary redundancies to employees whose positions were abolished as a result of the implementation of the operational review. He advised Mr Green that offering voluntary redundancies in relation to positions abolished in the engineering team would reduce the cost savings that the Company could achieve.
On 30 June 2014, Mr Gorman prepared an organisation chart which proposed the abolition of five engineering positions (including Mr Giddings’ and Mr Rosewarn’s positions) and three other positions (including two Administration Assistant positions). He provided this chart to Mr Green at about that time.
On 4 July 2014, Mr Green made a presentation to the annual general meeting of the Lodge in which he stressed, amongst other things, the difficult market conditions which the Company was facing. He sought the agreement of those present to forego a 4.5% wage increase which was their entitlement under the Agreement. At this time, Mr Green did not mention the proposal contained in Mr Gorman’s spreadsheet of 30 June 2014.
In a period which Mr Stewardson identified no more precisely than that it was “between June and October 2014”, he prepared a series of PowerPoint slides titled “Operations Review: Indicative Engineering Team Organisation Charts”. At trial, this document was marked, and I shall refer to it, as Ex A4. It included various organisational charts: one headed “Current” which represented the then current positions which reported to him and showed “each role to become redundant” (five positions, including those occupied by Mr Giddings and Mr Rosewarn); one headed “Post Ops Review”; one headed “Post R&C”; and a final one headed “Nirvana”. Mr Stewardson was cross-examined about that heading, and he said that it was “to make myself feel good”. He agreed with counsel that that it was his “ideal structure”, that it contained his “ideal personnel filling particular positions” and that he did not want Mr Giddings in his team. In his reasons of 8 October 2015, the primary Judge said: “In the final chart he prepared, headed ‘Nirvana’, Mr Giddings no longer had a job in the Engineering team.” That was strictly accurate, but any impression from his Honour’s observation that previous slides had not also omitted Mr Giddings’ position would not have been justified: the “Post Ops Review” and the “Post R&C” slides likewise did not include the position of Long Term Planner, or the name of Mr Giddings.
In about mid-July 2014, in preparation for a meeting with Mr Green, Mr Stewardson reviewed a number of positions within the engineering team, and prepared a summary of his views as to whether each position was necessary for the Company to operate effectively. On 17 July, he emailed the summary to Mr Green and Ms Ragen. He proposed the abolition of positions which included those of Long Term Planner and Facilities Maintenance Engineer. The summary included a passage in which Mr Stewardson said that the necessary organisational changes could not be achieved in a timely way through consultation, and that the Company should “just do it”.
It is next necessary to mention a document prepared by Mr Gorman titled “FY15 PKCT Operations Organisational Review”, to which the primary Judge referred as the “OOR report”. Although (as will be mentioned further below) his Honour rejected much of Mr Gorman’s evidence, there are some respects in which that evidence appears to have been uncontroversial. There were four drafts of the OOR report in evidence, all of which were produced by the Company pursuant to a Notice to Produce served by the respondents. In the circumstances, the first evidence which Mr Gorman gave about them was under cross-examination. He then told counsel for the respondents that he had, on Ms Ragen’s suggestion, used as a template a document previously used by another company in the same group as one of the consortium members. He had altered that template and produced a document which was relevant to the situation at Port Kembla, a task which occupied him for about 4-5 hours. That was the first draft of the OOR report, which Mr Gorman said had been prepared on or before 2 July 2014. In his reasons, the primary Judge said that the first draft was “produced” shortly after 2 July 2014, but that was, it seems, a reference to the timing of Mr Gorman’s dissemination of the draft to others in the management of the Company, including Mr Green, Mr Stewardson and Ms Ragen, by way of a shared link on the Company’s computer network.
Of the first draft of the OOR report his Honour said:
Although the draft report did not identify the positions to be made redundant it focused on the management and implementation of the planned dismissal of some employees for reasons of redundancy. It is significant that the report was prepared on the basis that [the Company] was required to redeploy affected employees through offers of voluntary redundancies and by reducing contractors, so as to avoid forced redundancies.
The second draft OOR report was, according to the primary Judge, produced by Mr Gorman and Ms Ragen in July 2014. His Honour noted that it revealed “a significant change in [the Company’s] approach to its obligations to make use of redeployment and voluntary redundancy before implementing forced redundancies and to investigate all avenues to avoid forced redundancies including by the reduction of contractors.” His Honour said that the first draft tended to show that Mr Gorman, Mr Stewardson and Ms Ragen understood that, where employees were facing redundancy, the Company was obliged under the Agreement “to redeploy them into suitable vacancies that arose through offers of voluntary redundancy or into suitable contractors’ work”. His Honour found that “the contemporaneous documents” also tended to show that these managers recognised that there were potentially available avenues for the redeployment of Mr Giddings and Mr Rosewarn.
By contrast, it was stated in the second draft OOR report that there were no redeployment options for those employees within the Company. His Honour said:
The second draft OOR Report includes a section headed “Bona Fide Redundancy Checklist” which indicated that Mr Giddings and Mr Rosewarn were not to be redeployed:
(a)into any suitable vacancy created through offers of voluntary redundancy because they each occupied an “appointed position” which is described as “stand-alone”; or
(b)into suitable contractors’ work (by reducing contractors) because the contractors were not engaged on a full time and permanent basis; ….
The primary Judge said that, from this time, the proposal to abolish positions proceeded on the basis that it would occur without voluntary redundancies being offered in relation to Mr Giddings’ and Mr Rosewarn’s positions, and without reducing contractors. His Honour accepted Mr Gorman’s evidence that the change in the Company’s approach to its obligation to investigate reducing contractors followed receipt of legal advice authorised by Mr Green in June 2014. His Honour inferred that Mr Green, Mr Gorman and Ms Ragen were informed of that advice in around July 2014.
The primary Judge also found that the third draft OOR report was created by Mr Gorman and Ms Ragen, and provided to Mr Stewardson and Mr Green by way of a shared link at the time of its creation. His Honour said:
In the third draft report the proposal to abolish the Long Term Planner, Facilities Maintenance Engineer and two Administration Assistants positions was mature and comprehensive, and in my view essentially complete. It indicated that offers of voluntary redundancy would not be made other than in relation to the Administration Assistant positions and that contractor positions which were not full-time and permanent would not be considered for reduction.
According to the primary Judge, in the third draft OOR report the proposal to abolish positions was to be announced on 21 October 2014, and to be followed by three weeks of consultation.
The primary Judge was obliged to determine when the third draft OOR report was produced. This was not a straightforward matter since, although his Honour described these documents as “reports”, they were in fact different versions of an electronic artefact that Mr Gorman had created and shared with other managers through the Company’s computer network. None, it appears, was formally published as a paper document and dated as such. The word processor dates appearing on the foot of all or most pages were quite unrevealing as to the date upon which the content on any particular page took the form in which it was rendered, in hard copy, for the purposes of becoming an exhibit in the case below. Indeed, it was put to Mr Gorman, and he accepted, that some of those dates referred to times when the template of the original document had not yet come into the possession of Ms Ragen.
Remembering that the first draft OOR report was produced on about 2 July 2014, and that the second such report was produced later in the same month, the primary Judge found, as a matter of inference, that the third such report was also produced in that month. As I read his Honour’s reasons in this regard, he placed weight on passages in which the periods during which certain affected employees would be absent from work (on account of leave, etc), and thus unavailable for consultation subsequent to the announcement of proposed redundancies were identified prospectively. In each case the information was said to be “as at 25 July 2014”. Ms Arber had annual leave “planned” for 18-24 September; Mr Rosewarn had leave “booked” for 22 September-17 October; Mr Giddings “would be” absent on union business on 4-5 August 2014. His Honour noted that both Mr Gorman and Mr Green accepted that they saw a document in the same form as, or similar to, the third draft in July 2014. His Honour did not put great store by this circumstance, because of the strong similarity of different versions of the report, but it was a factor tending in the direction of inferring a July date for the production of the report. Additionally to those considerations, the primary Judge noted that these draft reports were the Company’s documents, and that there appeared to be no reason why the Company could not have called more satisfactory evidence of their dates of production, for example by calling Ms Ragen as a witness (which was not done).
As against those considerations, his Honour acknowledged the appellants’ point that the third draft used the past tense to state that the development of the proposal “commenced” in August-October 2014. But he answered that point by noting that each draft of the report used the word “commenced” in the same context “and it could just as easily have remained unchanged between drafts.” His Honour also noted the date, 21 October 2014, stated in the third draft as the time of the announcement of the proposal referred to in it, but he took the view that this aspect was “far from conclusive”, and that it may have been explicable by the fact that Mr Rosewarn was to be absent on leave from 22 September to 17 October 2014.
In his reasons of 8 October 2014, the primary Judge continued:
For completeness I note that, after both parties had closed their cases and without seeking leave to do so, [the Company] sought to file three computer screenshots as Attachments A, B and C to its reply submissions dated 5 May 2015. Although [the Company] put on no evidence as to the provenance or meaning of the screenshots it submitted that they showed the dates that the three draft report [sic] were produced. The Union objected to the admission of further evidence on the basis that it had closed its case and that doing so would deny the Union a proper opportunity to test the provenance and understand the meaning of the screenshots. I have upheld that objection and I have not admitted Attachments A, B and C into evidence.
The primary Judge’s conclusion that the third draft had been produced in July 2014 was significant in his Honour’s disposition of a number of factual issues which arose in the case before him because it opened the inference that it was by reference to that draft that Mr Green gave consideration to the proposal at the end of that month or the beginning of August and because, save for one point of detail, the draft represented the proposal ultimately announced by the Company in December 2014.
There was a fourth draft of the OOR report produced on about 16 October 2014, the significance of which, in the view of the primary Judge, was that, “apart from some date changes, [it] was no different in substance from the third draft OOR Report prepared before the 1 August meeting.”
On 1 August 2014, Mr Gorman, Mr Stewardson and Ms Ragen met with Mr Green. He considered their recommendation to abolish Mr Giddings’ and Mr Rosewarn’s positions, along with either one or two Administration Assistant positions. They recommended that the Company not offer voluntary redundancies to avoid forced redundancies in relation to Mr Giddings’ and Mr Rosewarn’s positions, and that it consider reducing contractors only where the contractors concerned were engaged on a full time and permanent basis. As to the latter aspect, the primary Judge noted that there were no such contractor roles. His Honour also noted that if both of these recommendations were accepted, there would inevitably be no positions into which Mr Giddings or Mr Rosewarn could be redeployed.
In his reasons of 8 October 2015, the primary Judge noted Mr Green’s evidence that, having received these recommendations, he explored the business case and rationale for them, the extent of the cost savings or efficiencies which they could achieve, and the practicality of implementing them. In evidence which was “essentially” corroborated by Mr Gorman and Mr Stewardson, Mr Green said that he did not accept the recommendations at that time, but gave the proposal involved in them “intermittent consideration over the next two and a half months” until mid or late October. His Honour did not accept that evidence. He held it to be “likely that Mr Green followed the recommendation of his senior managers and made the decision to abolish Mr Giddings’, Mr Rosewarn’s and at least one Administration Assistant position at or shortly after the 1 August 2014 meeting.” He accepted that Mr Green may have “given some further thought to the issue” after 1 August 2014, but he took the view that “nothing occurred thereafter which was anything more than fine tuning a decision already made.”
Mr Green met with Mr Gorman, Ms Ragen and Mr Stewardson on five occasions between 1 August and 18 November 2014 to discuss the progression of the operational review. The primary Judge rejected as “implausible” what he described as the Company’s evidence that these meetings involved “final recommendations”, at least insofar as Mr Giddings’ and Mr Rosewarn’s positions were concerned. His Honour found that there was “no cogent evidence” of any significant further or “final” recommendations; and there was no “material change” in the senior managers’ recommendations of 1 August 2014. The primary Judge referred, however, to the evidence of Mr Stewardson (which his Honour did not, at least explicitly, reject) that, in these meetings, he reaffirmed his recommendation that the positions of Long Term Planner and Facilities Maintenance Engineer be abolished, and that, in October 2014, he prepared a summary document which set out the reasons underpinning his view that these positions need not be maintained.
Neither did the primary Judge accept the evidence of Mr Gorman that, through August and September 2014, he developed a consultation plan to ensure that the Company met its consultation obligations under the Agreement. Rather, his Honour found that Mr Gorman’s consultation plan had been developed in July by way of the draft OOR reports. His Honour also dismissed as “of little assistance in relation to the development of the proposal” a plan prepared by Ms Ragen titled “Organisational Review (Phase 2) - Communications and Engagement Plan” which Mr Gorman said that he saw in September or October 2014. Absent evidence from Ms Ragen (who was not called), and given the content of this plan, his Honour inferred that it had been created before the third draft OOR report.
More or less from the outset, Mr Tonini had advised Mr Gorman that no more than one Administration Assistant position could be abolished. At least some of Mr Gorman’s proposals had had it that two such positions would be abolished. His Honour found that, on 10 October 2014, Mr Tonini emailed Ms Ragen and reaffirmed his July advice to Mr Gorman that only one position should be abolished.
The primary Judge referred to Mr Green’s evidence in his affidavit that he did not make the decision to proceed with the proposed abolition of positions until mid-October 2014. It was not until then, he said, that he informed Mr Gorman, Mr Stewardson, Ms Ragen and Mr Tonini that he endorsed the recommendations and that he decided to announce the proposal and to commence consultation with the Union. His Honour noted, however, that in cross-examination Mr Green “altered his evidence somewhat” by stating that he made that decision “around 29 October or in early November”. Mr Green also said that he did not make the decision that voluntary redundancies would not be offered in relation to Mr Giddings’ and Mr Rosewarn’s positions until mid-October, and that he did not decide that the Company’s consideration of reducing contractors would be limited to full time and permanent contractor roles until 10 December. The primary Judge accepted Mr Green’s evidence that, in October 2014, he had intended to announce the proposal to abolish positions in mid-November, but he delayed that announcement to 2 December 2014, because a farewell dinner for five longstanding employees was scheduled for 21 November.
The primary Judge referred to an email, dated 23 October 2014, headed “Legally Privileged – Confidential – Operational Review” from Ms Ragen to Mr Green, Mr Stewardson, Mr Gorman, Mr Tonini and others, and which included an invitation to a meeting on 29 October 2014. Ms Ragen attached a number of documents that, his Honour inferred, were to be discussed at the meeting, including a detailed execution timeline and calendar setting out the timing of the process for engaging in consultation, a documentation checklist and action list for impacted employees, template correspondence that was to be provided to each redundant employee, a redundancy information booklet dated June 2014, a list of frequently asked questions and proposed responses, the undated communication and engagement plan prepared by Ms Ragen which Mr Green said that he saw in September or October 2014, a briefing sheet titled “PKCT Organisation Review – Impacted Employee Record of Discussions” for use by a manager meeting with an affected employee, and the final draft OOR report (ie that which his Honour found to have been produced on about 16 October 2014). The primary Judge said: “Those documents show a highly planned process for compulsory redundancies, even including template correspondence to be given to employees who were to be made redundant.”
There was a meeting on 29 October 2014. The primary Judge referred to Mr Green’s evidence that this meeting was “to discuss various amendments to and refinements to the initial proposals”. His Honour did not accept that evidence, adding: “The documents tend to show that the meeting was about execution of pending redundancies rather than refinements to the proposal.”
The primary Judge found that the Company announced the proposal which involved the abolition of positions the subject of the case before him “with military precision”. On 1 December 2014, Mr Green telephoned Robert Timbs, Vice-President of the South-Western District Branch of the Union, to advise that he would be addressing a meeting of employees the following morning, but he did not inform Mr Timbs of the exact purpose of the meeting, as he said that doing so would “compromise the necessity of consultation”. Mr Green also emailed Mr Giddings and other members of the Lodge executive to invite them to the meeting, but he did not tell them, either, what was to be said at the meeting. At 8:04 am on 2 December 2014, Mr Green emailed the management and team coordinators to inform them that all employees were required to attend an information meeting at 9:00 am.
At that meeting, Mr Green informed the assembled employees that the outcomes of Phase 2 of the operational review would soon be implemented. He said that this stage might involve redundancies and that potentially affected employees would be spoken to that day, but he added that the Company was yet to make a final decision on any redundancies. Immediately after the meeting, Mr Green and other managers met with Union representatives, including Mr Giddings, Mr Timbs and Murray Dakers, vice-president of the Lodge. He gave a PowerPoint presentation, titled “PKCT Operational Review @ 2 December 2014”, which referred to the proposed abolition of positions, and reiterated that a final decision had yet to be made. He was questioned on the basis and rationale for the abolition of positions, and how any redundancies were proposed to occur, but he said he was not prepared to provide further information until the potentially affected employees had been informed that their positions were under threat.
In separate meetings on the same morning, Mr Giddings and Mr Rosewarn were informed that their positions were proposed to be abolished, and the three Administration Assistants, Ms Arber, Karen Maxwell and Nicky Ostach, were informed that one such position would be abolished and that, if none of them elected to take a voluntary redundancy, the Company would make one of them compulsorily redundant. At the end of those meetings, the affected employees were handed a letter dated 2 December 2014 titled “Business changes impacting your employment” which notified them of the outcome of the operational review, and noted that there were no vacant positions within into which they might potentially be redeployed.
On the afternoon of 2 December 2014, a second consultation meeting took place involving, amongst others, Mr Green, Mr Stewardson, Mr Tonini, Mr Giddings, Mr Timbs and Mr Dakers. At that meeting, Mr Timbs identified provisions of the Agreement which, in the view of the Union, required the Company to offer voluntary redundancies to employees other than those whose positions were to be abolished, and to consider reducing contractors before implementing forced redundancies. Mr Green said that voluntary redundancies would be offered only in relation to the Administration Assistant position, and that the Company was not obliged to offer voluntary redundancies in relation to the Facilities Maintenance Engineer and Long Term Planner positions.
On the morning of 3 December 2014, Mr Green met with Mr Gorman, Mr Stewardson, Mr Tonini and the Human Resources Manager, Amy Linton. There was some discussion as to the Union’s view that there were some “gates” through which the Company was required pass, and as to the Union’s concerns about employee classification, the use of contractors, and the separation of the Long Term Planner role from the other planning roles. Mr Green requested that the senior managers consider each of the issues raised by the Union and prepare responses so that he could be in a position to inform the Union of the Company’s position.
At 5:24 pm on 3 December 2014, Ms Linton emailed a document to Mr Gorman and Mr Stewardson and others, summarising the Union’s concerns and setting out a range of responses to matters anticipated to be raised by the Union. In relation to redeployment into contractors’ work it was stated:
a.The Company is obliged to explore a reduction in contractors, where the work performed by a contractors [sic] can be performed by Employees of the Company, having regard to the skills and competencies of Employees and the nature of the work in question[.]
b.[The Company] has reviewed the need for contractors to determine whether any contractor’s work can be performed by an affected employee, having regard to the skills and competencies of the employee and the nature and duration of the work.
c.We will not redeploy people into contract roles which are for a finite duration where it does not make sense to do so having regard to the status of the contract and the skills required.
d.[Insert link to matrix of all contractor positions at [the Company] and analysis of the skills of employees to be made redundant to evidence that the positions are not suitable (including because positions are temporary)]
i.initial draft document has been created, to be updated by Roger/John as discussed M:\MANAGERS\Human Resources \ Management Access HR Files\Industrial Relations Material\Project Warranty\Operational Review October 2014\Analysis of contractor positions.xlsx
The “matrix” of contractor positions for which a link was required was an assessment of contractor roles that might be performed by affected employees. It had been prepared by Geraldine Uren, a contractor working in an administrative capacity. Although she did not give evidence, the matrix was tendered by the appellants, over the objection of the respondents. It took the form of a very brief spreadsheet, as follows:
Affected Role Identified contract role Analysis of suitability (please elaborate if possible) Administration Assistant HR Assistant
[insert additional positions]Role is of a limited duration Long Term Planner AM Specialist Role is part time and fixed term, specialist database and systems skill required on ad hoc basis. Contracts Manager Role is part time and fixed term.
Project Engineers Currently engaged on an as needs basis ranging from 1 day per week to 5 days week for defined period across the execution of defined project timeframes. Two projects roles exist and are not deemed redundant. Project Supervisors Painting Specialist Role is of a limited duration/LTP is unskilled in role/skill being developed in existing PKCT projects officer role. Fitters Sporadic engagement to address peaks and troughs, not suitable for LTP. R&C Project roles Roles are fixed term across R&C Project delivery. No funding in place to continue past R&C funding approvals. [insert additional positions] Facilities Maintenance Engineer Plumber Non-permanent roles that are engaged on a sporadic basis based on plant access and workload. PKCT sees no requirement for fulltime 5 day a week plumber. R&C Project roles Roles are fixed term across R&C Project delivery. No funding in place to continue past R&C funding approvals. [insert additional positions]
The primary Judge inferred from this matrix that it was Ms Uren’s view, or the view of the manager who instructed her, that Mr Giddings had suitable skills for the contractor roles of Asset Management Specialist, Contracts Manager, Project Engineer, Project Supervisor, Painting Specialist, Fitter or an R&C Project role but that his skills were unsuitable for the roles of Asset Management Specialist and Painting Specialist, that Mr Rosewarn had suitable skills to work as a plumber or perform some R&C Project roles and that Ms Arber had suitable skills to work in an administrative support role within the Human Resources team.
On 4 December 2014, the Union wrote to the Company requesting it to provide information about the work undertaken by contractors so that it might meaningfully participate in consultation about reducing contractors. It sought the provision of extensive information, the detail of which was set out in the reasons of the primary Judge, but which does not need to be included here. On 5 December 2014, Mr Green met with his senior managers to prepare the Company’s response to that request. In what his Honour described as “extensive email exchanges through that day”, Mr Gorman, Mr Stewardson and Ms Linton discussed the precise wording to be used in the response. His Honour recounted Mr Gorman’s concession in cross-examination that, in formulating this response, he was “simply seeking to justify the company’s position the best way that he could, rather than genuinely considering the Union’s alternative view”.
On 8 December 2014, the Company provided its written response to the Union. It was, his Honour found, “little more than a reiteration of [the Company’s] position”. Provision of the information sought by the Union regarding contractors was refused. On 9 December 2014, the Union wrote again to the Company, maintaining that its actions were inconsistent with the Agreement, and complaining that the threatened dismissal of Mr Giddings constituted adverse action under the FW Act.
In an email sent to Mr Green, Ms Linton, Mr Tonini and Mr Stewardson early on 9 December 2014, Mr Gorman stated:
For the potentially impacted employees that the Company does not take through a voluntary redundancy process (i.e. LTP and FME roles), the “decision” on Thursday should be the “decision” to make those potentially impacted employees redundant, with any formal letter of redundancy to be issued on Thursday.
The primary Judge regarded Mr Gorman’s use of inverted commas around the word “decision” as indicating “that he knew that the decisions concerning the Long Term Planner and Facilities Maintenance Engineer positions had already been made”.
Also on 9 December 2014, Mr Tonini met with Ms Linton to discuss the possibility that none of the (three) Administration Assistants would elect to take a voluntary redundancy. They prepared a draft list of the criteria by reference to which the Company would decide which of these assistants would be made redundant, if none of them made such an election.
There was to be a further meeting between management and the Union at 9 am on 10 December 2014. At 8:11 am, Mr Green sent an email to Ms Linton, Mr Tonini, Mr Gorman, Mr Stewardson, Ms Uren, Ms Ragen and others, in which he set out the terms of letters which were to be sent to Mr Giddings and Mr Rosewarn. They included the following passage:
We have recently held discussions with you concerning Port Kembla Coal Terminal’s decision to undertake an organisational review. As discussed, we have carefully considered all the matters you have raised during the consultation. Regrettably, the outcome of the review and consultation is that your current position is no longer required.
At the meeting at 9 am, which was attended by Mr Green, Mr Stewardson, Mr Tonini, Ms Linton, Mr Timbs, Mr Giddings and Mr Dakers, the Union representatives argued that the Company should offer voluntary redundancies in relation to Mr Giddings’ and Mr Rosewarn’s positions and should consider further avenues to redeploy the affected employees. Mr Timbs asked why the Company was not exploring all avenues to avoid the forced redundancies of the three affected employees, and complained that the Company’s refusal to provide the requested information about contractors meant that the Union was unable properly to engage in consultation. Mr Green reiterated the view that the Company was not obliged to offer voluntary redundancies in relation to positions outside the finance/administration team, or to consider reducing contractors’ work save where the contractors were engaged on a full time and permanent basis. In his reasons, the primary Judge said, “Overall, there was little real engagement between the parties in the meeting and they just reiterated their positions.”
During the course of this meeting, Mr Timbs told Mr Green that the Union had canvassed some of its members, and that there were some employees who were interested in the option of voluntary redundancy. But Mr Green made it clear that the Company would not entertain the notion of offering voluntary redundancies in relation to Mr Giddings’ and Mr Rosewarn’s positions.
As the meeting drew to a close Mr Green said something to the following effect:
I am not fully au fait with the implications and applications of what has been said. It is [sic] given me food for thought. I will see that a decision will be made by tomorrow.
In cross-examination, however, Mr Green conceded that, before the meeting, he had already decided to terminate the employment of Mr Giddings and Mr Rosewarn, and that he would not alter that position.
Following the meeting, Mr Green gave some attention to what the comparative severance costs would be if, instead of Mr Giddings, Mr Rosewarn and Ms Arber being made redundant, three other long-serving employees took up voluntary redundancy. The result of what Mr Green described as a “short analysis” was that “at first glance the suggestion is more costly”.
At about 2 pm (still on 10 December 2014), Mr Green met with Mr Stewardson, Mr Tonini and Ms Linton. In his evidence, Mr Stewardson said that they discussed the issues raised by the Union during the meeting earlier that day, including the means by which the forced redundancies of the Long Term Planner and Facilities Maintenance Engineer roles might be avoided, and that Mr Green said that he had considered each of the issues raised by the Union and had made the decision that the three identified positions were redundant. The primary Judge did not accept this evidence. His Honour found that Mr Green had made that decision on or about 1 August 2014, and that there would have been no point in a discussion about the means of avoiding these forced redundancies. His Honour noted that Mr Green had conceded that his mind was made up on the morning of 10 December 2014.
On 11 December 2014, in separate meetings, Mr Green informed Mr Giddings and Mr Rosewarn that their employments had been terminated due to redundancy, effective immediately. Each was given a letter to that effect.
Later on 11 December 2014, Mr Tonini and Ms Linton met with the three Administration Assistants. Mr Tonini informed them that the opportunity for expressing an interest in voluntary redundancy was soon to close, and that if no-one elected to take that opportunity the Company would select one of them for forced redundancy. None of the three did elect for voluntary redundancy. Mr Tonini then recommended to Mr Green that Ms Arber be selected for redundancy. Mr Green accepted that recommendation, and it was put into effect.
THE RESPONDENTS’ CASE AT FIRST INSTANCE
In relation to their cause of action for contravention of various provisions of the Agreement, the respondents relied on s 50 of the FW Act, which provides as follows:
A person must not contravene a term of an enterprise agreement.
The provisions of the Agreement of which the respondents alleged contraventions were to be found in cll 7 and 13.5 thereof, which provided as follows:
7. Workplace Change and Consultation
7.1 Consultation over significant change or effect will occur where:
a.the Company is considering introducing a major change to production, program, organisation, structure, technology, shift arrangements, work organisation or the level of outsourcing in relation to its enterprise; and
b.the change, if implemented, is likely to have a detrimental or significant effect on employees.
7.2. The purpose of consultation is to:
a.Resolve issues, where possible, at the workplace and avoid unnecessary problems by identifying and discussing matters of actual or potential concern as close to the workplace as possible;
b.Improve the level of understanding between management, Employees and Employee Representatives by exchanging relevant information on a timely basis; and
c.Deliver an efficient decision-making process by ensuring Employees are aware of a review of their work area that could lead to significant change or effect on working arrangements and allowing Employees and Employee Representatives inputs to be taken into consideration through a process of consultation, prior to a final decision being taken by management.
7.3.The Company will give prompt and genuine consideration to matters raised by the relevant Employees and their Employee Representatives.
7.4.The Company will notify the relevant Employees and their Employee Representatives of the proposed change as soon as a decision has been made.
7.5. The consultation process may be modified by agreement between the parties.
7.6. Significant change or effect may include but is not limited to:
a.major changes in the composition, operation or size of the Company’s workforce; or
b. the skills required; or
c. the significant restructuring of work organisation; or
d.proposals by the Company to outsource services or contract out services currently provided by Company Employees.
7.7.The above definition seeks to illustrate that the changes requiring extensive consultation generally need to have broad impacts and be likely to affect a significant part of the Company’s operations or affects Employees’ working arrangements.
7.8.The consultations will be conducted within a context which acknowledges the statutory obligations and responsibilities of the Company and where the Employees and Employee Representatives do not have a power of veto over the Company’s final decision. This does not affect the right of the Employees or their representatives to notify a dispute through the agreed Dispute Settlement Procedure.
….
13.5 Redundancy
13.5.1.The Company undertakes that in managing manning levels to suit the business needs it will make use of redeployment and voluntary redundancy prior to implementing any forced redundancies.
13.5.2.If workforce reductions for Employees bound by this Agreement were to become necessary, they will be undertaken through the consultative process described in this Agreement.
13.5.3.The Company shall investigate all avenues to avoid forced redundancies, including the reduction of contractors, where the work performed by contractors can be performed by Employees of the Company, having regard to the skills and competencies of Employees and the nature of the work in question.
13.5.4.If a redundancy situation still exists after the above steps have been taken, the process for determining required compulsory redundancies within a classification will be through consultation, including taking length of service into account.
13.5.5.Should the need for redundancy arise, the PKCT standard severance package of four weeks pay in lieu of notice and three weeks pay per each year of service paid at the Special Purpose Rate shall apply, unless otherwise agreed or determined.
It was alleged by the respondents that, in the circumstances obtaining at the terminal in 2014, the Company was considering introducing a major change within the terms of cl 7.1 of the Agreement, and that such change was likely to have a significant or detrimental effect on employees. It was said that the Company contravened that provision by failing to consult the Union and the potentially affected employees. It was also alleged that the Company contravened cl 13.5.1 by terminating the employments of Mr Giddings, Mr Rosewarn and Ms Arber without having first having made use of “redeployment and voluntary redundancy”, and contravened cl 13.5.3 by terminating those employments without first having investigated the “reduction of contractors”.
Clause 9 became relevant in the contribution which it made to the respondents’ case under cl 7.1, in ways to which I shall refer. It provided as follows:
9. Employment· Security
9.1.The parties acknowledge that job security is a mutual obligation. Security of employment is important for improving working relationships, trust and cooperation with change. The parties do not want an environment where everyone is working in fear of losing their employment. The parties want an environment where people focus on doing their jobs safely, well and implementing improvement actions. Real employment security can only be achieved by successful business performance.
9.2.It is not intended that the number of direct, full time employees engaged by the Company under this Agreement at the date that it is approved will be reduced over the life of the Agreement. However, the Company retains the right to make such changes should circumstances arise which, in its opinion, necessitate a change to the numbers of employees per shift or the skills components of teams. In such circumstances the Company will comply with Clause 7 (Workplace Change and Consultation) prior to the implementation of any change to manning levels.
9.3.If a redundancy situation still exists after the consultation process in Clause 7 has been complied with, this will be dealt with in accordance with Clause 13.5 Redundancy.
9.4.Where an Employee has appropriate skills and qualifications, it is the Company’s intention to provide Employees with opportunities for involvement in the “PKCT Upgrade Project”.
9.5.The Company will not terminate the employment of Employees on the ground of redundancy, or not replace Employees who resign or retire, in order to:
a. replace the Employee with a contractor; or
b. have the job of the Employee performed by a contractor.
9.6.The commitments above do not prevent the Company from using natural attrition or a process of redundancy to reduce the size of its workforce, nor does it require the Company to replace any Employee who retires or resigns.
9.7.The Company is entitled to engage and use contractors, provided that the job security of Employees is not affected, consistent with the terms of this clause.
9.8.When engaging contractors whose employees perform work within the scope of this Agreement, the contractor will be required to pay their employees the more beneficial of:
a.The Special Purpose Rate for the minimum grade level of equivalent or comparable Employees engaged under this Agreement (Grade 1 for Operators and Grade 3 for Trades) together with the payment of overtime in accordance with Clause 15.3.2 and Meal Allowance in accordance with Clause 15.6; or
b.The ordinary time earnings contained in an Enterprise Agreement made under the Fair Work Act 2009 and binding the contractor and his or her employees.
The respondents’ case under ss 340 and 346 of the FW Act was confined to the circumstances of Mr Giddings. As to s 340, the respondents relied on para (a) of subs (1):
(1) A person must not take adverse action against another person:
(a) because the other person:
(i) has a workplace right; or
(ii) has, or has not, exercised a workplace right; or
(iii)proposes or proposes not to, or has at any time proposed or proposed not to, exercise a workplace right….
The workplace right on which the respondents relied was that referred to in s 341(1)(a) of the FW Act, namely, that Mr Giddings had roles or responsibilities under a workplace law or instrument, including those of Lodge President and workplace representative under the Agreement.
As to s 346, the respondents relied on paras (a) and (b) thereof:
A person must not take adverse action against another person because the other person:
(a)is or is not, or was or was not, an officer or member of an industrial association; or
(b)engages, or has at any time engaged or proposed to engage, in industrial activity within the meaning of paragraph 347(a) or (b);…
The industrial activities upon which the respondents relied under s 346(b) were those set out in para (a), and in subparas (ii), (iii) and (v) of para (b), of s 347, namely, that Mr Giddings remained an officer or member of an industrial association, that he organised or promoted a lawful activity for or on behalf of an industrial association, that he encouraged or participated in a lawful activity organised or promoted by an industrial association, and that he represented or advanced the views, claims or interests of an industrial association.
The respondents also alleged a contravention of cl 4(k) of App 1 to the Agreement, but nothing further needs to be said about that here because his Honour rejected the allegation and there is no cross-appeal or notice of contention in relation to that rejection.
THE PRIMARY JUDGE’S CREDIBILITY FINDINGS
Some 84 paragraphs of the reasons of the primary Judge were concerned with the credibility of Mr Stewardson, Mr Gorman and Mr Green as witnesses in the case. As will appear, his Honour swept aside virtually all of their evidence that might have been of any value to the appellants in factually controversial areas of the case. From the tenor of his Honour’s reasons, evidence that was against interest or uncontroversial appears to have been accepted. Necessarily, in this part of his reasons the primary Judge effectively made findings of fact in a number of significant areas that were then later applied in his Honour’s disposition of the respondents’ various claims.
The primary Judge said that, although he had “thought long and hard before reaching this view”, he was “drawn to conclude that Mr Green’s, Mr Stewardson’s and Mr Gorman’s evidence was quite unreliable”. His Honour said:
In their affidavits Mr Stewardson, Mr Gorman and Mr Green each purported to present a comprehensive account of the development of the proposal to abolish positions and terminate the employment of the affected employees. In cross-examination each of them confirmed that this was so. However, each of their carefully constructed affidavits disguised rather than illuminated the decision-making process. Amongst other things, it became clear in cross-examination that each of them had not disclosed important documents and decisions, omitting matters which were contrary to the thrust of [the Company’s] case. In my view each of them did so deliberately.
As an example of these deliberate omissions, his Honour noted that each of these witnesses had failed to disclose documents that showed that in April, May and June 2014, the first three months of the operational review, Mr Gorman, Mr Stewardson and Ms Ragen –
… approached the proposal to abolish positions on the understanding that, before implementing forced redundancies, [the Company] was obliged to:
(a)offer voluntary redundancies in relation to Daywork Appointed positions such as Mr Giddings’ and Mr Rosewarn’s positions to see whether suitable vacancies might be created into which they could be swapped; and
(b)investigate all avenues to avoid forced redundancies including by a reduction of contractors, that is, ascertain whether there was suitable contractors’ work into which the affected employees might be placed….
As to the second aspect, his Honour found that, at the time, there was no suggestion that the Company should restrict its consideration to contractors engaged on a full time and permanent basis. His Honour said that “they” (presumably Mr Gorman and Mr Stewardson) did not disclose that they initially thought that there were likely to be suitable positions within the Company, or in contractors’ work, into which Mr Giddings and Mr Rosewarn might “potentially have been redeployed”.
The primary Judge expressed the view that the evidence “tends to show” that Mr Green had access to the senior managers’ documents through shared links on the Company’s computer network, and that he was aware of his senior managers’ approach. However, neither he nor the senior managers disclosed the relevant documents or decisions in their affidavits. His Honour continued:
For example none of them disclosed:
(a)the Scenario Planner prepared by Mr Gorman in May 2014 which tends to show that he thought that within [the Company] there were five suitable positions for Mr Giddings and one suitable position for Mr Rosewarn (if such positions became vacant through offers of voluntary redundancy). Nor did any of them disclose that the Scenario Planner indicates that Mr Gorman thought that there were three suitable contractor roles for Mr Giddings and one for Mr Rosewarn (as well as two “Project/Non EA positions”);
(b)the OOR Report which was the central document in planning and documenting the Operational Review. This was a significant omission because the second and third draft OOR Reports in July 2014 show a critical change in [the Company’s] approach to the proposed abolition of positions. They reveal that, from that date, [the Company] approached the proposed abolition of positions on the basis that:
(i)voluntary redundancies would not be offered in relation to Mr Giddings’ and Mr Rosewarn’s positions; and
(ii)the consideration of reducing contractors would be limited to contractors engaged on a full-time and permanent basis (when there were no such contractors).
None of them disclosed or explained this critical change in their affidavits and Mr Green did not disclose that his decision to abolish the positions and terminate the employment of the affected employees involved this critical change. In my opinion they sought to disguise that fact.
The primary Judge pointed out that these witnesses did not disclose that the final draft OOR report of 16 October revealed that there had been no material change in the proposal since late July. His Honour expressed the view that:
… they sought to conceal the fact that by the 1 August meeting Mr Green had been presented with a comprehensive and essentially complete proposal to abolish the relevant positions, and that the proposal did not materially change over the next four months.
His Honour said that to have revealed “this draft report” (presumably the third draft OOR report) would have seriously weakened the Company’s contention that it had provided timely consultation. The failure of these witnesses to disclose that report “significantly reduced the credibility of their testimony”.
His Honour continued:
Further, when it suited Mr Stewardson, Mr Gorman and Mr Green they were exact in their recollection as to the dates of the relevant events. However, when it did not suit them they only offered a broad range of dates for a particular event or occurrence, such as “between July 2014 and late October 2014”. They took that approach even though the relevant events occurred only about six months before issue of the proceedings. I do not accept that their recollection was so limited and in some instances I consider they were prevaricating.
His Honour said that these witnesses were not frank in their evidence about the dates upon which Mr Green made the decisions to abolish the positions of Mr Giddings and Mr Rosewarn, and at least one Administration Assistant position, and to terminate the employment of Mr Giddings and Mr Rosewarn rather than to redeploy them into “any suitable vacancies created through offers of voluntary redundancy” or by reducing contractors. His Honour found that, except for “some refinements which were not material”, those decisions had been made by Mr Green on or about 1 August 2014.
The primary Judge then turned to a detailed consideration of the credibility of each of Mr Stewardson, Mr Gorman and Mr Green.
As to Mr Stewardson, the primary Judge noted that he had said in his affidavit that he worked closely with Mr Gorman and Ms Ragen to identify ways in which the company could achieve efficiencies and reduce costs. His Honour noted that the thrust of Mr Stewardson’s evidence was that he carefully examined each position in the engineering team and identified particular positions that could potentially be consolidated or removed while ensuring that the Company could meet its operational requirements, and that, as part of that process, he proposed the abolition of the Long Term Planner position, the Facilities Maintenance Engineer position, and other positions. His Honour inferred that Mr Stewardson informed Mr Green of the positions proposed to be abolished early in the operational review. His Honour noted that it was uncontentious that, at the meeting on 1 August 2014, he joined in the recommendation that Mr Giddings’ position, Mr Rosewarn’s position and at least one of the Administration Assistant positions be abolished.
The primary Judge noted Mr Stewardson’s evidence that he made his recommendation to abolish the relevant positions in good faith and after careful consideration, doing so because they could be abolished while still allowing the Company to meet its short and long term operational requirements, and that Mr Green was the decision maker. His Honour noted that Mr Stewardson “corroborated Mr Green’s account that he did not make the decision to proceed with the proposal to abolish positions until October 2014.” His Honour noted that the gist of Mr Stewardson’s evidence was that the recommendation in relation to Mr Giddings’s position was not actuated in any way by Mr Giddings’ union roles and/or his industrial activities, and that no part of the reasons for recommending the abolition of his position, or Mr Green’s reasons for deciding to terminate Mr Giddings’ employment, included his union role and/or his involvement in industrial activities.
The primary Judge said that he “found Mr Stewardson’s evidence unreliable”, adding:
Notwithstanding that he said that his affidavit was a full account of the relevant decision making process, he failed to disclose important documents and important parts of that process, in my view deliberately. His evidence was implausible in light of the contemporaneous documents and the surrounding facts and circumstances and I give it little or no weight.
Under the heading “Mr Stewardson’s failure to disclose important documents and matters”, the primary Judge dealt first with Ex A4 (see para 19 above). His Honour noted Mr Stewardson’s evidence, under cross-examination, that that presentation was created between June and October 2014. But he had not made mention of it in his affidavit. His Honour did not accept that Mr Stewardson’s memory was “so poor” that he was unable to be more specific about the timing of the creation of this presentation: in his Honour’s own view, it was “likely that he prepared the presentation in about July 2014”. His Honour noted that Mr Stewardson prevaricated when explaining the ‘Nirvana’ chart, but when pressed he conceded that it showed his view that, ideally, Mr Giddings would not be employed in his engineering team. His Honour said: “This was contrary to the thrust of his evidence that he did not have an adverse view about Mr Giddings’ work at the terminal or his union role and industrial activities”. His Honour said that Mr Stewardson “tried to downplay” the importance of the presentation by describing it as a “thought proposal document” and by saying that it was for his own consideration, but his Honour held it to be improbable that Mr Stewardson would have prepared the presentation for his own use rather than just preparing a set of notes. His Honour noted that Mr Stewardson accepted that Mr Gorman had prepared some of the organisation charts in the presentation, and that he (Mr Stewardson) had “offered no cogent explanation” as to why Mr Gorman’s charts would have been included in his presentation if it was prepared only as a “thought proposal” document for his own use. His Honour considered it to be likely that Mr Stewardson provided the presentation to Mr Green and the other senior managers through a shared link. On this aspect, his Honour concluded:
In my view he failed to disclose the presentation in an attempt to avoid disclosing his real view about Mr Giddings. I have little doubt that he considered Mr Giddings’ Union roles and/or industrial activities were a real impediment to the better operation of the terminal.
The primary Judge dealt next with Mr Stewardson’s failure to disclose the scenario planner (see para 15 above) in his affidavit. His Honour noted that this document had been prepared by Mr Gorman in June 2014. Mr Stewardson said that he first saw it between June and October 2014 as part of a presentation regarding cost savings. His Honour did not accept that Mr Stewardson’s “memory was so poor”, and expressed the view that he (Mr Stewardson) was “prevaricating in providing that broad timeframe”. His Honour held it to be likely that Mr Stewardson saw the scenario planner “in about July 2014”. His Honour noted that, when Mr Stewardson was pressed as to why he had failed to mention the Scenario Planner in his affidavit, “he hedged to an extent”. His Honour held it to be likely that he had not disclosed it because it showed that Mr Gorman was “open to redeploying employees in Daywork Appointed positions into vacancies created through offers of voluntary redundancy and by reducing contractors, and that he had identified some potential avenues to avoid the forced redundancies of Mr Giddings and Mr Rosewarn.”
The primary Judge dealt next with Mr Stewardson’s failure to disclose the OOR report in his affidavit, notwithstanding that it was the primary planning document in the operational review. His Honour noted that the second and third draft OOR reports showed that, by late July 2014, Mr Gorman and Ms Ragen (with input from Mr Stewardson) had prepared a comprehensive and essentially complete proposal to abolish the positions of Mr Giddings, Mr Rosewarn and two Administration Assistants, and which recommended that the Company “make critical changes in its approach to its obligations under the Agreement”, namely, not to make offers of voluntary redundancy in relation to Mr Giddings’ and Mr Rosewarn’s positions, and to restrict its investigation of reducing contractors to those engaged on a full time and permanent basis “(when there were no such contractors)”. His Honour continued, “[t]hose changes of approach were vital parts of the decision-making process leading to the termination of Mr Giddings’ and Mr Rosewarn’s employment, yet Mr Stewardson did not disclose them.” His Honour dismissed what he described as Mr Stewardson’s downplaying of his failure to mention the report on the basis that it was produced by Mr Gorman and Ms Ragen, and that he had no input into its content, by reference to Mr Stewardson’s concession, when pressed, that he had reviewed the report at various meetings and that had had some input into it. His Honour added: “He failed to disclose the OOR Report in the context that no other [Company] witness had disclosed it either.”
The primary Judge dealt next with Mr Stewardson’s concession under cross-examination that, until late May 2014, he thought that it might be possible to redeploy Mr Giddings into other positions and that he had discussed that with Mr Gorman. These matters had not been disclosed by Mr Stewardson in his evidence-in-chief. His Honour noted that, under cross-examination, Mr Stewardson had also conceded that his consideration of avenues through which Mr Giddings might be redeployed was an important part of the decision-making process. His Honour held it to be likely that Mr Stewardson did not disclose that because it was contrary to the thrust of the Company’s case.
The primary Judge next observed that, in Mr Stewardson’s affidavit, he had made no mention of the change in his approach to the obligation to offer voluntary redundancies in relation to Daywork Appointed positions before implementing forced redundancies.
The primary Judge next observed that, in Mr Stewardson’s affidavit, he had made no mention of any assessment of the nature of the work undertaken by contractors, or the necessary skills to perform that work, so as to identify any opportunity to redeploy Mr Giddings and Mr Rosewarn into suitable contractors’ work. However, under cross-examination he said that he and Mr Gorman had undertaken that analysis. But his Honour did not accept that Mr Stewardson undertook “any proper assessment of the work performed by contractors or a proper comparison of the necessary skills for that work against Mr Giddings’ and Mr Rosewarn’s skill and competencies”. His Honour held it to be “improbable that he undertook that work when he did not adduce any document to show that he or Mr Gorman did so, and when, from about July, he and Mr Gorman took the view that only contractors engaged on a full time and permanent basis needed to be considered and there were no such contractors.”
Under the heading, “Other matters going to the credibility of Mr Stewardson’s evidence”, the primary Judge referred first to an email from Mr Stewardson to Ms Ragen on 16 April 2014 which identified Mr Giddings’ and Mr Rosewarn’s positions amongst those in the engineering team that could be abolished. This proposal, as his Honour described it, included the assumption that “VRs to be offered and accepted based on the stream as per EA” (his Honour quoting from the email). His Honour said that the proposal tended to show that, at the time, Mr Stewardson understood the Agreement to require the Company to offer voluntary redundancies to employees working in the same stream as the employee whose position was abolished. His Honour found: “In my view he sought to avoid disclosing this as it is contrary to the thrust of [the Company’s] case.”
The primary Judge dealt next with a statement made by Mr Stewardson in his affidavit that, following a meeting on 2 May 2014, he agreed to review the engineering team’s functions with a view to determining if there were any opportunities to consolidate or to reduce roles within it. His Honour held that evidence to be “implausible” since Mr Stewardson had already reviewed his team’s functions for that purpose on 16 April 2014, and had set out his view in the Organisational Redesign Stage 2 proposal sent to Ms Ragen (see para 10 above). His Honour noted that, under cross-examination, Mr Stewardson tried to defend his evidence by insisting that he did not consider his 16 April 2014 proposal to be a detailed one, but he then conceded that he had not subsequently prepared a more detailed proposal. In his Honour’s view, Mr Stewardson “tried to paint a picture of the proposal to abolish positions being developed later than it in fact was, probably in an effort to support [the Company’s] argument that it had provided timely consultation.”
The primary Judge dealt next with a statement made by Mr Stewardson in his affidavit that, in June 2014, Mr Gorman gave him an amended organisational chart and asked him for his comments in relation to the positions to be abolished. His Honour noted, however, that Mr Stewardson had already provided Mr Gorman with his views on the positions to be abolished in his 16 April 2014 proposal, and that he had conceded in cross-examination that the organisational charts that Mr Gorman gave him included those that he himself (Mr Stewardson) had prepared. His Honour took the view that Mr Stewardson “sought to leave the impression that the proposal to abolish positions was developed later than it was.”
The primary Judge next referred to the summary which Mr Stewardson prepared in mid-July 2014 (being the document referred to in para 20 above). His Honour noted that it included the following passage under the heading “Background”:
Our business systems (in particular our [enterprise agreement]) create a culture of role protection first rather than business improvement. A culture so engrained that no consultative change management model will achieve cost reduction across an expedient timeframe. Our change management process must revert to a “just do it” model, which then allows people learn [sic] new approaches to “survive” in the new paradigm created.
His Honour noted that Mr Stewardson “initially prevaricated” as to what he meant in this passage, but then conceded that he thought that the consultation process in the Agreement would not allow the Company to make necessary workplace changes in a timely way. His Honour said: “His prevarication was most likely an attempt to avoid disclosing his view, because it was contrary to [the Company’s] case that it provided genuine consultation.”
As each of the applicants was a day worker, the changes associated with their redundancies did not necessitate a change in the number per shift in the relevant sense. Accordingly, I consider that cl 9.2 did not, independently of cl 7, require PKCT to consult with the applicants or the CFMEU in accordance with cl 7.
Conclusion on breach of cl 7
For these reasons, I consider that the Judge’s finding that PKCT contravened cl 7 of the PKCT Agreement should be set aside.
CLAUSE 13.5
Again, for convenience, I will repeat the terms of cl 13.5:
13.5 Redundancy
13.5.1.The Company undertakes that in managing manning levels to suit the business needs it will make use of redeployment and voluntary redundancy prior to implementing any forced redundancies.
13.5.2.If workforce reductions for Employees bound by this Agreement were to become necessary, they will be taken through the consultative process described in this Agreement.
13.5.3.The Company shall investigate all avenues to avoid forced redundancies, including the reduction of contractors, where the work performed by contractors can be performed by Employees of the Company, having regard to the skills and competencies of Employees and the nature of the work in question.
13.5.4If a redundancy situation still exists after the above steps have been taken, the process for determining required compulsory redundancies within a classification will be through consultation, including taking length of service into account.
13.5.5Should the need for redundancy arise, the PKCT standard severance package of four weeks pay in lieu of notice and three weeks pay per each year of service paid at the Special Purpose Rate shall apply, unless otherwise agreed or determined.
Looked at generally, cl 13.5 imposes an overarching obligation on PKCT to “investigate all avenues to avoid forced redundancy” (cl 13.5.3) and, in particular, to make use of redeployment, to make use of voluntary redundancy, and to investigate reduction of contractors when employees who have been considered for retrenchment may, having regard to their skills and competencies and the nature of the work in question, perform work which is being carried out by contractors.
The primary Judge found that PKCT did not comply with the obligations imposed by cll 13.5.1 and 13.5.2 in relation to the terminations of Mr Giddings and Mr Rosewarn, but that it had done so in relation to the termination of Ms Arber. The Judge summarised his conclusions with respect to the contraventions of cl 13.5 as follows:
[9] In my view PKCT breached its obligation under cl. 13.5 of the Agreement to:
(a)make use of redeployment and voluntary redundancy prior to implementing “forced redundancies” (which is the term used in the Agreement for compulsory redundancies) as required under cl. 13.5.1; and
(b)investigate all avenues to avoid the forced redundancies of the affected employees including by the reduction of contractors, as required under cl 13.5.3.
In summary, I say this because PKCT did not give proper consideration to redeploying Mr Giddings and Mr Rosewarn into any suitable vacancy which might have arisen through offers of voluntary redundancy or any suitable role which might have arisen by PKCT reducing its use of contractors.
[10]PKCT refused to seek expressions of interest in voluntary redundancy in relation to Mr Giddings’ and Mr Rosewarn’s positions, and as a result they were denied the possibility of redeployment within PKCT. … PKCT refused to consider reducing contractors, unless the contractors were engaged on a full‑time and permanent basis (when none were so engaged). That approach to the construction of the Agreement meant that no contractors fell to be considered by PKCT in its investigation of reducing contractors.
As can be seen, this summary suggests that the Judge had found that PKCT breached cll 13.5.1 and 13.5.3 because it had not given proper consideration to redeploying Mr Giddings and Mr Rosewarn into any suitable vacancy which may have arisen through offers of voluntary redundancy or any suitable role which may have arisen by a reduction of its contractors.
With respect to the Judge, this summary is incomplete, because he had also found that PKCT had failed to make use of redeployment in respect of Mr Giddings and Mr Rosewarn in a way which was independent of his findings concerning voluntary redundancy and reduction of contractors. The Judge found that there was no cogent evidence that PKCT had given proper consideration to comparing the skills and competencies of Mr Giddings and Mr Rosewarn against those required in other positions, at [354]; that Mr Green did not have proper understanding of Mr Giddings and Mr Rosewarn’s skills and competencies compared with the requirements in other positions, at [356]; that none of Mr Green, Mr Gorman or Mr Stewardson had spoken to Mr Giddings or Mr Rosewarn to ask for their assessment of their capacity to fill properly other positions, at [357], and then concluded:
[358]In fact, it is unsurprising that nobody undertook a proper comparative assessment of Mr Giddings’ and Mr Rosewarn’s skills and competencies in the period from August through to December 2014. Given that Mr Green had decided in August 2014 that PKCT would not offer voluntary redundancies in relation to their positions, it is likely that he and his senior managers thought it unnecessary to do that work.
The Judge then went on to find that each of Mr Giddings and Mr Rosewarn had suitable skills and competencies to perform properly a number of positions within PKCT, at [359]‑[369]. He concluded as follows:
[370]Mr Green’s evidence that Mr Giddings and Mr Rosewarn did not have suitable skills and competencies for them to be placed into any other positions with reasonable training did him no credit. His evidence was far-fetched given Mr Giddings’ history of performing Area Planner work, the diverse work experience both employees had, their competence, their obvious ability to learn new skills, and the fact that nobody made a proper assessment of their skills and competencies in relation to other positions.
[371]In my view by not undertaking a proper comparative assessment of the skills and competencies of Mr Giddings and Mr Rosewarn, and by failing to seek expressions of interest in voluntary redundancy in relation to their positions, PKCT breached its obligations to make use of redeployment and voluntary redundancy prior to implementing any forced redundancies, and to investigate all avenues to avoid their forced redundancies.
[372]Mr Giddings also said, and I accept, that the positions of Team Coordinator and Backup Coordinator at PKCT were advertised as vacant on 26 September 2014 and those vacancies were filled on 3 November 2014. This tends to show that after the decision to abolish Mr Giddings’ and Mr Rosewarn’s positions was made in August 2014, but before it was announced, there were two vacant positions into which they could have been redeployed. By the time the proposal was announced the vacant roles had been filled. In taking this approach PKCT again failed to explore all avenues to avoid forced redundancies and it failed to comply with cl. 13.5.
(Emphasis added)
On their face, [371] and [372] are findings that PKCT had contravened cl 13.5.1 by not making use of redeployment in a way which was independent of the Judge’s findings with respect to voluntary redundancy and reduction of contractors.
It was Mr Giddings who gave evidence concerning the positions of Team Coordinator and Backup Coordinator which are the subject of the Judge’s findings in [372]. In his affidavit of 19 December 2014, Mr Giddings deposed:
[108]I could have been redeployed to the Team Coordinator or Back Up Coordinator Positions. These positions are in the Shift Appointed Positions classification. These positions are a Grade 5 or Grade 6. I would have accepted redeployment into one of these positions.
It is implicit in [108] that Mr Giddings was asserting that there were two positions to which he could have been redeployed, and that he was capable of performing the duties in those positions.
In his affidavit of 10 February 2015, Mr Green responded to this evidence as follows:
[153]I refer to paragraph 108. No team coordinator or Back Up Coordinator positions were vacant at the time of the restructure, nor are any vacant now. These roles are in a different classification to the LTP.
As can be seen, by [153] Mr Green disputed the availability of the positions identified by Mr Giddings, but not his ability to perform the duties involved.
Mr Giddings responded to this evidence from Mr Green in his affidavit of 23 February 2015:
[18]I refer to paragraphs 153 and 154 of Mr Green’s statement and say that paragraphs 108 and 109 of my First Affidavit were directed to the issue of the potential for redeployment. In previous reorganisations at PKCT where consultation did occur with the union, voluntary redundancies created vacancies to facilitate such redeployment and this could also have occurred in the most recent review. Had consultation occurred, I may have accepted a transfer into roles which were not strictly redeployment but resulted in a decrease in my grading and salary. The example given would have resulted in approximately a $3000 decrease to go to Grade 5, or an increase in salary to go to Grade 6 (which attracted shift work rates of pay for that role). I note that there were in fact vacancies for team coordinator and back up coordinator positions, which were filled at PKCT on 3 November 2014, after they were advertised on 26 September 2014.
(Emphasis added)
Mr Giddings annexed to his affidavit copies of the document by which PKCT had on 26 September 2014 sought expressions of interest from its employees to fill two Shift Team Coordinator positions to commence in March 2015 and the announcements dated 3 November 2014 of those who would fill a Shift Team Coordinator position (commencing immediately), a Shift Team Coordinator position (commencing in May 2015) and a Backup Coordinator position (commencing immediately). These documents contradicted Mr Green’s evidence that coordinator positions had not been vacant “at the time of the restructure”. Mr Green did not challenge this evidence of Mr Giddings nor seek to explain the inferences arising naturally from the documents. Even on Mr Green’s own evidence that it was not until mid‑October 2014 that he had decided to proceed with the abolition of the positions of Mr Giddings, Mr Rosewarn and one administrative assistant, the vacancies had existed at the time of the “restructure”, even if they no longer existed at the time of the terminations on 11 December 2014.
Thus, it was open to the Judge to conclude that PKCT did, after Mr Green had decided on or about 1 August 2014 that Mr Giddings and Mr Rosewarn’s positions were redundant, have other positions which were available and suitable to their respective skills and competencies and to which they could have been redeployed.
None of PKCT’s grounds of appeal challenged the Judge’s findings in [372] that there were two vacant positions into which each of Mr Giddings and Mr Rosewarn could have been redeployed and that, by announcing the retrenchments after the vacancies had been filled, PKCT had thereby failed to explore all avenues to avoid forced redundancies, in contravention of cl 13.5.
It is not clear whether there was direct evidence of Mr Rosewarn’s ability to perform the functions in the two positions identified by Mr Giddings. However, the Judge was favourably impressed with the evidence concerning Mr Rosewarn’s qualifications, experience and ability to do a number of other jobs within PKCT. This evidence appears to have provided an adequate basis for the Judge’s finding as to Mr Rosewarn’s ability to fulfil the two positions and, in any event, there has been no appeal against that part of the Judge’s findings.
In his submissions in reply to those of the applicants which had drawn attention to the findings in [372], counsel for PKCT submitted that the absence of oral evidence with respect to the two positions identified by Mr Giddings meant that their relevance was uncertain. I would not accept that submission. The passages in Mr Giddings affidavit, which I have set out above, make readily apparent the relevance of this evidence.
There is accordingly a finding by the Judge that PKCT contravened cl 13.5.1 by not making use of redeployment and that finding is not now challenged.
Despite the absence of challenge to this part of the Judge’s findings, it is appropriate to consider the proposed appeal against the Judge’s findings that PKCT contravened cl 13.5 in other respects.
Seven of the grounds in PKCT’s draft notice of appeal alleged errors by the Judge with respect to his construction and application of cl 13.5 of the PKCT Agreement. Two of those grounds (4 and 7) did not add to the substance of the complaints raised in other grounds. Of the remaining five grounds, four raised complaints of errors by the Judge in the construction of cl 13.5 and one, Ground 5, raised a challenge to the Judge’s findings of fact.
Voluntary redundancies: cl 13.5.1
PKCT’s criticisms of the Judge’s construction of the obligations imposed by cl 13.5 with respect to the use of voluntary redundancies are set out in the reasons of Jessup J, and I will not repeat them. Like Jessup J, I consider that the proper construction of cl 13.5.1 does give rise to a number of issues. However, I take the view that it is unnecessary to address those issues because I agree, with respect, with the reasoning of Jessup J in [172]‑[173] concerning the use of local practice and usage in the construction of the expression “make use of … voluntary redundancy” in cl 13.5.1. In particular, I respectfully agree with the reasons of Jessup J in [173] for concluding that PKCT contravened cl 13.5.1 in the case of Mr Giddings and Mr Rosewarn. That being so, it is preferable to leave to an occasion when it is necessary to do so consideration of the other issues arising under cl 13.5.1.
Reduction in contractors: cl 13.5.3
Again, I can state my conclusions shortly. The Judge held at [378]:
[T]he obligation requires PKCT to undertake a bona fide investigation of reducing contractors. In relation to Mr Giddings and Mr Rosewarn it completely failed to do so. It did not undertake any proper comparative assessment of their skills and competencies to ascertain the viability of reducing contractors and redeploying them into that work, and instead it so restricted its consideration of reducing contractors that there were no contractors that fell to be considered.
The Judge identified the restriction to which he referred in this passage in [377] of the reasons, namely, “PKCT’s refusal to investigate reducing contractors unless the contractors were engaged on a full‑time and permanent basis”.
It is apparent that the Judge relied on the evidence of Mr Green in identifying PKCT’s approach to reducing its contractors. In his affidavit of 10 February 2015, Mr Green deposed:
[125]I was not prepared to redeploy employees into contract roles which are of a finite duration, where it did not make sense to do so having regard to the status of the contract and the skills required. Having considered the roles of contractors currently at PKCT, I was satisfied, based on the information provided to me from Mr Gorman and Mr Stewardson, that there were no roles undertaken by contractors that could be considered full‑time or permanent that were practical to place the employees into.
(Emphasis added)
The second emphasised passage made it apparent that Mr Green had confined his consideration of contractor positions to those which were, amongst other things, “full‑time or permanent”. I note that the Judge referred to contractors who were “full‑time and permanent” rather than those who were “full‑time or permanent” as stated by Mr Green in his affidavit. It was not suggested that anything turned on this difference in the determination of the proposed appeal, perhaps because Mr Green himself had used the former term in a letter of 8 December 2014 to Mr Timbs, the District Vice President of the CFMEU in which he explained PKCT’s approach:
PKCT has reviewed the need for contractors engaged by PKCT to determine whether any contractor’s work can be performed by a potentially affected employee, having regard to the skills and competencies of the employee and the nature and duration of the work.
There are no current vacant contract roles that the potentially affected employees may be redeployed into. PKCT has also considered non‑vacant contract roles. There are currently no roles undertaken by contractors that could be considered full‑time and permanent that PKCT’s operational requirements and business needs required full‑time permanent employees to be placed into. PKCT will not redeploy full‑time permanent employees into contract roles which are for a finite or uncertain duration where it does not make sense to do so having regard to the status of the contract and the skills required.
(Emphasis added)
The contemporaneous document made it apparent that PKCT had confined its consideration of the possible reduction of contractor positions to those that were full‑time and permanent. This was a self‑imposed limitation in that it was neither required nor authorised by the terms of cl 13.5.
There are other indications that PKCT had confined its consideration of contractor positions inappropriately. The Operations Organisational Review dated 16 October 2014 contained a “Bona Fide Redundancy Checklist”. The checklist question concerning contractors was in the following terms:
Are there contractors within the business doing a similar role which could be reasonably deemed to be permanent?
(Emphasis added)
This question was answered in the negative in the case of each of Mr Giddings, Mr Rosewarn and Ms Arber.
Accordingly, the Judge’s conclusion that PKCT had confined its consideration of the contractors who might be reduced in a way which was not warranted by cl 13.5.3 is unsurprising, and has not been shown to be in error.
PKCT’s draft notice of appeal raises two complaints concerning the Judge’s findings with respect to cl 13.1.5:
[5]The primary Judge erred (at [377]) by finding that the first appellant “refused to investigate reducing contractors unless the contractors were engaged on a full‑time and permanent basis”. The finding was against the evidence which was that the first appellant would consider contractor roles for reduction where those roles would only allow fixed term or part‑time employment if done by an employee.
[6]The primary Judge erred (at [383]) in finding that cl 13.5 of the Agreement imposed an obligation “to consider redeploying an effected employee initially into one contractor role and then moving him or her to another contractor role when the first role came to an end”.
There is nothing in proposed Ground 5. The summary of the evidence contained in this ground does not match the evidence given by Mr Green which I have set out above. It is true, as I have said, that the Judge proceeded on the basis that Mr Green required the contractors’ positions to be both full‑time and permanent when he had used the disjunctive “or” but, as I have said, that was the approach which Mr Green had articulated in his letter to Mr Timbs on 8 December 2014.
There is force in PKCT’s complaint contained in Ground 6. I respectfully agree with the reasons of Jessup J in [179] on this issue. However, that conclusion does not have the consequence that an appeal against the Judge’s findings with respect to the contravention of cl 13.5 should be allowed. On the contrary, I consider, for the reasons stated above, that this aspect of the proposed appeal would be dismissed. In that circumstance, I would prefer not to express any view on the other issues of construction arising under cl 13.5.
ADVERSE ACTION
The Judge found that Mr Giddings was a longstanding and active member of the CFMEU, and that he held a number of union and union‑related leadership positions, at [420]. The applicants’ case was that PKCT had taken adverse action (terminating Mr Giddings’ employment) in contravention of ss 340(1) and 346 of the FW Act for prohibited reasons, namely, because Mr Giddings:
(1)exercised, or proposed to exercise a workplace right, namely, his role or responsibilities under a workplace law and/or workplace instrument, being the roles of Lodge President and of employee representative under the PKCT Agreement; and/or
(2)was an officer of an industrial association, namely, the Lodge President; and/or
(3)had engaged in industrial activity as defined in s 347(a) and s 347(b)(ii), (iii) and (v) of the FW Act.
By reason of s 361 of the FW Act, PKCT had the onus of proving that its termination of Mr Giddings was not for any of these reasons. As Mr Green was the decision‑maker, it was, as the Judge found at [419], his reasons for the decision to terminate which were relevant. However, one of the reasons which the Judge gave for finding Mr Green’s evidence to be unreliable was that the evidence corroborating it from Mr Gorman and Mr Stewardson was also unreliable, at [444].
At [426]‑[443], the Judge summarised and evaluated the 10 matters which PKCT had submitted, taken in combination, indicated that Mr Green’s reasons for terminating Mr Giddings employment did not include his union roles and/or his industrial activities. The Judge accepted some of these matters: that there was a genuine basis for PKCT’s conclusion that Mr Giddings’ position was redundant, at [427]‑[429]; that many of the industrial disputes in which Mr Giddings had been involved and on which the applicants relied had occurred so long ago as to be of little relevance, at [431]; that there was no evidence of other adverse action having been taken against Mr Giddings previously, despite his extensive participation in industrial activities, at [434]; that in the period when Mr Green was said to have had animus towards Mr Giddings, he had provided advantages to him in his employment (supporting him by payment in relation to his study for a Master of Business degree, promoting him to the highest grade under the PKCT Agreement, and treating him as an integral and trusted person in the job redesign process in 2013 in which Mr Giddings’ position as Long Term Planner had been created), at [435]; and that PKCT did not have any vacant positions suitable for Mr Giddings at the termination of his employment on 11 December 2014, at [438].
In respect of two of the other 10 matters, the Judge declined to draw the inferences for which PKCT had contended, but that rejection did not turn on his assessment of Mr Green’s reliability, at [437] and [441]‑[442].
The Judge’s evaluation of only three of the 10 matters on which PKCT relied involved a rejection of Mr Green’s evidence, although some of these matters involved multiple sub‑matters. The Judge said that he did not accept Mr Green’s evidence that it was not operationally efficient or reasonable to offer voluntary redundancies in relation to Mr Giddings’ position, at [439](b)]; that Mr Giddings did not have suitable skills and competencies to perform properly any other position within PKCT, at [439(c)]; that he had given proper consideration to the issue of reducing contractors, at [440(b)]; that Mr Giddings did not have suitable skills and competencies to undertake contractors’ work properly, at [440(c)]; and Mr Green’s evidence about the time he had made the decision that Mr Giddings’ employment should be terminated, at [443]. It is also implicit in the Judge’s conclusion concerning s 361 that he did not accept Mr Green’s own denial that he had taken any account of Mr Giddings’ union roles and his industrial activities.
Thus, it is evident that the Judge’s conclusion that PKCT did not discharge the s 361 onus turned in part on his assessment of the reliability of Mr Green’s evidence.
The draft notice of appeal contains 18 separate grounds alleging errors by the Judge in his findings that PKCT’s termination of Mr Giddings contravened the prohibitions on adverse action in ss 340(1) and 346 of the FW Act. Three of these (Grounds 18, 19 and 20) complain expressly of the Judge’s assessment of the evidence of Mr Green as “unreliable”. None, however, raised the complaint made in PKCT’s written outline, and made prominently at the hearing, that the Judge’s adverse assessment of Mr Green’s reliability was affected by the circumstance that Mr Green had not been given the opportunity at the trial to deal with a very serious criticism of his evidence made by the Judge. This was the Judge’s finding that Mr Green had deliberately failed to disclose relevant matters in the affidavit containing his evidence in chief. The Judge made a like criticism of Mr Gorman and Mr Stewardson.
As indicated, PKCT’s outline of submissions did contain a contention that, in making these criticisms of Mr Green, Mr Gorman and Mr Stewardson, the Judge had not complied with the approach explained by the majority (Heydon, Crennan and Bell JJ) in Kuhl v Zurich Financial Services Australia Ltd [2011] HCA 11; (2011) 243 CLR 361 at [64] and [67]. At [67], the majority said:
It is not sound judicial technique to criticise a party-witness for deliberately withholding the truth in a fashion crucial to a dismissal of that party's claim unless two conditions are satisfied. First, reasons must be given for concluding that the truth has been deliberately withheld. Secondly, the party‑witness must have been given an opportunity to deal with the criticism.
Mr Green was a party in his own right to the proceedings. He was accordingly a “party‑witness” of the kind to which the majority referred in [67]. The principle that a party‑witness be given an opportunity to deal with any criticism which is crucial to a dismissal of the party’s claim is a manifestation of the wider proposition stated by Lord Herschell LC in Browne v Dunn (1893) 6 R 67 at 70‑1 that, when a witnesses’ evidence is to be impeached, the witness must be given “an opportunity of making any explanation which is open to him, … [this being] essential to fair play and fair dealing with witnesses”.
Although PKCT did not include a complaint based on Kuhl in its grounds of appeal, I consider that it should be able to rely on that complaint on the application for leave to appeal. The applicants had notice of PKCT’s intention to rely on Kuhl and in fact made extensive submissions in response to it. No relevant prejudice is occasioned to them by reason of PKCT’s reliance on Kuhl, even though it had not been included in the draft notice of appeal. Further, it would be difficult for this Court to deal with the three grounds identified above which do complain of the Judge’s assessment of Mr Green’s reliability without considering this aspect of the trial. Finally, the Judge’s findings about Mr Green’s evidence are strong criticisms, and there would be some unfairness to him given, as I would conclude, PKCT’s complaints concerning the Kuhl approach are justified.
The Judge’s criticisms of Mr Green appear in the following paragraphs:
[146]In my view the evidence tends to show that Mr Green had access to the senior managers’ documents through shared links on PKCT’s computer network and that he was aware of his senior managers’ approach. However, neither he or the senior managers disclosed the relevant documents or decisions in their affidavits. For example, none of them disclosed:
…
(b)the OOR Report which was the central document in planning and documenting the Operational Review. This was a significant omission because the second and third draft OOR Reports in July 2014 show a critical change in PKCT’s approach to the proposed abolition of positions. …
None of them disclosed or explained this critical change in their affidavits and Mr Green did not disclose that his decision to abolition the positions and terminate the employment of the affected employees involved this critical change. In my opinion they sought to disguise that fact.
[147]None of them disclosed that the final draft OOR Report of 16 October reveals that there was no material change in the proposal from late July. In my view they sought to conceal the fact that by the 1 August meeting Mr Green had been presented with a comprehensive and essentially complete proposal to abolish the relevant positions, and that the proposal did not materially change over the next four months. …
…
[194]However, although [Mr Green’s] affidavit purported to be a full account of the decision-making process (which he confirmed in cross-examination) he failed to disclose some important documents and important parts of the decision-making process. In my view his failure was deliberate. ...
…
[199]Mr Green’s failure to disclose the OOR Report occurred in the context that no other PKCT witness disclosed it either, and in my view it was not just a mistake. He did not disclose it even though it was the main report planning and documenting the Operational Review and it reveals the critical change in PKCT’s approach to its obligations under the Agreement. In my view his failure was deliberate. …
…
[205]In his affidavit Mr Green did not disclose that, in late June 2014, he was advised by Mr Gorman that voluntary redundancies should not be offered in relation to Mr Giddings’ and Mr Rosewarn’s positions because it would reduce cost savings. … He said that he could not remember discussing that issue with Mr Gorman in late June but I prefer Mr Gorman’s evidence as to the date of discussion. I doubt that Mr Green had forgotten discussing that important question with Mr Gorman and in my view he sought to conceal the early date upon which he first considered not offering voluntary redundancies.
(Emphasis added)
As I have said, these are strong findings. The significance of findings of this kind was explained by majority in Kuhl at [64]:
[T]he conclusion by the trial judge that the plaintiff – a party-witness – deliberately withheld evidence reflected a stronger reaction. It operated as a finding that there had been an admission. It could be inferred that the evidence was withheld, in breach of the witness's duty to tell the whole truth in answer to the question, because the plaintiff was conscious that success in the litigation would be rendered impossible or less likely if the material withheld were revealed. Depending on the circumstances, when a party lies, or destroys or conceals evidence, or attempts to destroy or conceal evidence, or suborns witnesses, or calls testimony known to be false, or fails to comply with court orders for the production of evidence (like subpoenas or orders to answer interrogatories), or misleads persons in authority about who the party is, or flees, the conduct can be variously described as an implied admission or circumstantial evidence permitting an adverse inference. The position must be the same where there is a failure of a party-witness to comply with the duty of a witness to tell the whole truth. ...
During the cross‑examination of Mr Green, it was, more than once, put to him that the affidavit containing his evidence in chief did not include particular documents or evidence of particular matters. However, the cross‑examination did not go beyond that. It did not suggest that the absence of the documents or information resulted from a decision by Mr Green not to include that material, let alone a decision motivated by a desire to disguise relevant matters or to present an incomplete picture to the Court. On the hearing of the application for leave to appeal, counsel for the applicants did not submit that Mr Green had been given the opportunity to deal with the criticism made by the trial Judge that his failure to include documents and information was deliberate.
Counsel submitted instead that the Judge had concluded only that documents had been omitted because it was thought that they would not help PKCT’s case, and not that they had been concealed in the sense of hiding them so they could not be found. In my opinion, the language used by the Judge does not permit that understanding to be upheld, and it is in any event only marginally more benign.
This was not a case in which the only possible explanation for the documents and information not having been included in Mr Green’s affidavit was one of deliberate concealment. There are other possibilities: mistake; a misapprehension as to the significance of the documents; legal advice; and, in the case of some of the documents, the circumstance that PKCT had, at the time Mr Green made his affidavit, been maintaining a claim (ultimately unsuccessfully) for legal professional privilege. In these circumstances, it would not have been appropriate for the Judge to reason that their omission of the documents and information resulted necessarily from a deliberate decision to conceal them from the Court.
Accordingly, I am satisfied that the Judge’s findings concerning Mr Green’s concealment of documents and information should not be permitted to stand. The same applies in the case of Mr Gorman and Mr Stewardson.
I add, in fairness to the Judge, that it was, in my opinion, reasonable for him to expect that the narrative of events leading to the terminations to which Mr Green (and for that matter Mr Gorman and Mr Stewardson) deposed would be complete. As the majority observed in Kuhl at [64], a litigant who enters the witness box is under a positive duty to tell the whole truth in answer to the questions asked. Party‑witnesses who are permitted or required to give their evidence in chief in affidavit form should not be under any lesser obligation. This is so because the affidavit is an alternative to the evidence in chief being provided orally. Further, it is usually the case that party‑witnesses prepare their affidavits with the assistance of legal advisors and in a context which the form of the oath which the witness will be required to make when entering the witness box is well known. That oath includes a commitment to provide the court with “the truth, the whole truth and nothing but the truth”. In my opinion, a party‑witness who, having made an oath in this form, presents an affidavit as the evidence in chief thereby deposes that the affidavit meets this standard. That is especially so when the witness is recounting a narrative of events and when, as in this case, it is the party‑witness who carries the relevant onus.
It is apparent that the Judge was critical of Mr Green’s evidence in a number of other respects. The Judge said variously that he found aspects of Mr Green’s evidence to be “implausible”, “utterly implausible”, “improbable”, and “inherently unlikely”. In these circumstances, I have considered whether it may be said that the Judge’s findings that Mr Green had sought deliberately to conceal documents were not essential to his assessment of the reliability of Mr Green’s evidence relied upon by PKCT to discharge the s 361 onus. However, I do not consider such an analysis to be open. The Judge’s conclusion about Mr Green’s omission to disclose documents and other information appears to have been an integral part of his overall assessment of the reliability of Mr Green’s evidence. So much is evident from [16], [143]‑[144], and [194]. I note also that the Judge relied upon his earlier findings concerning the unreliability of Mr Green’s evidence (which included his findings on the topic of concealment) when considering whether PKCT had discharged the s 361 onus, at [444]‑[445].
Finally, when considering the claim that Mr Green was liable as an accessory, the Judge made a number of findings (which it is not necessary to recount presently) which were strongly critical of Mr Green’s evidence. It is evident that those findings too were influenced by the Judge’s view that Mr Green had set out to conceal documents from the Court. In my respectful opinion, it would not be realistic to conclude that the Judge’s assessment of these aspects of Mr Green’s evidence did not also influence his consideration of whether PKCT had discharged the s 361 onus.
For these reasons, I consider that this part of the proposed appeal should succeed, and the findings that PKCT contravened s 340(1) and s 346 of the FW Act set aside. The finding of accessorial liability against Mr Green should be set aside for the same reasons. There should be a retrial of these aspects of the applicants’ claims, if they are to be pursued.
THE ORDERS FOR REINSTATEMENT
With respect to the proposed appeal against the orders that Mr Giddings and Mr Rosewarn be reinstated to their employment with PKCT, I agree respectfully with the reasons of Jessup J at [270]‑[283] and do not wish to add to them. The proposed appeal against the orders for reinstatement should not succeed.
DISPOSITION OF THE APPLICATION FOR LEAVE TO APPEAL AND THE APPEAL
I respectfully agree that the orders proposed by Jessup J are appropriate, and with his reasons at [284]‑[287] for those orders.
In these circumstances, it is unnecessary to determine the applicants’ submission that leave to appeal should be granted only in respect of those of the 39 grounds which were addressed in PKCT’s outline of submissions.
I certify that the preceding one hundred and five (105) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice White. Associate:
Dated: 5 August 2016
SCHEDULE OF PARTIES
NSD 1431 of 2015 Respondents
Fourth Respondent:
JENNIFER ARBER
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