Potter v Pilot Freight Pty Ltd

[1996] IRCA 222

DECISION NO:   222/96

C A T C H W O R D S

INDUSTRIAL LAW - termination of employment - Relevant Wages - Probation - Operational requirements - Alternatives to termination - CONSULTATION - COMPENSATION

Industrial Relations Act 1988 ss.170CC, 170CD,170DC, 170DE, 170EE

CASES:

Reinhard Wolfer and Computer Associates Pty Ltd, IRCA 12 April 1995, Decision No 150 of 1995.

Ardino and Count Financial Group (1994) 1 IRCR 221 at 228

Nicholson and Heaven & Earth Gallery Pty Ltd (1994) 1 IRCR 199 at 202

Mitchell-Collins and The Latrobe Council (1995) 60 IR 480

Wynn’s Winegrowers Pty Ltd and Foster (1986) 16 IR 381 at 384

Quality Bakers of Australia and Goulding (1995) 60 IR 327

Jones and Department of Energy and Minerals (1995) 60 IR 304

Corkrey and General Motors Holden’s Limited (1986) 53 SAIR 531 at 538

Byrne and Australian National Airlines (1995) 131 ALR 422

Leddicot and Schiavello Commercial Interiors, IRCA (unreported) Dec. No 569 of 1995, 18 October 1995

Johns and Gunns Limited (1995) 60 IR 258, 272 and 273

POTTER -v- PILOT FREIGHT PTY LTD

No. VI-4943 of 1995

Before:  Judicial Registrar Ryan
Place:  Melbourne
Date:  17 May 1996

INDUSTRIAL RELATIONS COURT
OF AUSTRALIA
VICTORIA DISTRICT REGISTRY

VI-4943 of 1995

B E T W E E N :

STEPHEN POTTER
Applicant

AND

PILOT FREIGHT PTY LTD
Respondent

MINUTES OF ORDERS

Judicial Registrar Ryan       17 May 1996

THE COURT ORDERS:

1. That the Respondent pay the Applicant compensation in the sum of $25,480 to be paid to the Applicant within 28 days of judgment today.

NOTE:  Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules.

INDUSTRIAL RELATIONS COURT
OF AUSTRALIA
VICTORIA DISTRICT REGISTRY

VI-4943 of 1995

B E T W E E N :

STEPHEN POTTER
Applicant

AND

PILOT FREIGHT PTY LTD
Respondent

Before:       Judicial Registrar Ryan
Place:        Melbourne
Date:           17 May 1996

REASONS FOR JUDGMENT - EX TEMPORE

The Applicant claims compensation for unlawful termination of employment. The Respondent asserts the Applicant is excluded from the jurisdiction of Division 3 of Part VIA of the Industrial Relations Act 1988 and that in any event the termination was for valid reason and was harsh, unjust and unreasonable.

Mr Wraight of Counsel appeared for the Applicant and Mr Ironmonger of the Victorian Employers Chamber of Commerce and Industry for the Respondent.

APPLICABLE AMOUNT- RELEVANT WAGES - S170CD

At the start of the hearing having heard submissions for and against the proposition that the Applicant was excluded from jurisdiction as being in receipt of wages in excess of the applicable amount worked out using the formula in S170CD(1)(b), the Court ruled that the Applicant was not so excluded.

I do not propose to repeat that ruling or the reasons for it now but the ruling and reasons will be recorded in writing and incorporated in this judgment when it is likewise recorded in writing and copies are provided to the parties.

PRELIMINARY RULING - S170CD - 15 MAY 1996

The Respondent raised two issues in relation to jurisdiction and submitted both should be determined before the trial of the substantive issues.

The Applicant submitted both preliminary issues should be determined in the course of the trial. The Court indicated that it was prepared to deal with the alleged exclusion of the employee on the basis of wages exceeding the applicable amount pursuant to S170CD of the Industrial Relations Act 1988 (“The Act”) prior to the substantive trial. But if this was determined in the Applicant’s favour the preliminary issue of probation pursuant to S170CC and Regulation 30B would be determined as part of the trial.

The Respondent asserts that the Applicant is excluded under S170CD(1)(b) because the employee’s relevant wages exceeded the amount worked out using the formula therein described, that is described in S170CD(1)(b). The Respondent claimed that in reality the Applicant’s relevant wages were in excess of $70,000 being:

1. $58,000 salary

1. a car allowance of $12,000 which was, according to the Respondent, not really an allowance for a vehicle required in the course of employment

1. a Shell card for petrol

1. an allowance for business related telephone calls

1. a company superannuation contribution equivalent to 6% of gross salary and car allowance.

I have concluded that the employer’s superannuation contribution was based on an initial intention to provide the employee with a salary package of $70,000 and that the base figure of $58,000 was offered because the Applicant indicated that he was only prepared to accept employment if he had, to use his words, “a company car”. This evidence on negotiations is not contested although it is possible it could have been contested if the Respondent had called Mr Peter Licato on this issue.

The Applicant was not given a company car but he agreed to accept employment on the basis that he would take a car allowance in lieu. There is evidence that the car allowance was treated as a car allowance for taxation purposes with no tax instalments deducted, (see Exhibit A2, the letter of approval from the Deputy Commissioner of Taxation).

I have concluded that the car allowance while not initially contemplated was paid to the Applicant and indeed to another employee, Mr Geoff Taylor. In the case of the Applicant I have concluded that the employer came back to the Applicant with an offer which amounted to treating a car or the use of a car as something to be used in the course of employment in the sense in which Boon JR uses those words in the unreported case of Reinhard Wolfer and Computer Associates Pty Ltd (Industrial Relations Court of Australia) 12 April 1995, Decision No 150 of 1995 at page 10.

This may not have been the employer’s original intention, although evidence is sparse, but that is the effect of the agreement between the employer and the employee and is reflected in the letter of appointment and in the taxation arrangement with the Deputy Commissioner. I therefore exclude the car allowance from relevant wages.

I am also inclined to exclude the 6% employer contribution on $70,000 although I accept it is a 6% contribution on $70,000 as expressed in the letter of appointment. I am inclined to exclude the 6% which, coincidently, equals $4,200 p.a., on the basis of the view of the Chief Justice in Ardino and Count Financial Group (1994) 1 IRCR 221 at 228. The Chief Justice in Ardino at 228 initially states that he does not in that case think it is right to exclude superannuation payments. However he continues:

“I agree with Counsel that the definition of “relevant wages” is concerned only with payments that are wages strictly so-called. I do not think it includes payments made by an employer on behalf of an employee pursuant to a binding antecedent obligation whether statutory or contractual. It is now commmonplace for employers to make payments to a superannuation fund in respect of individual employees. This is usually because of a statutory obligation to that effect, sometimes because of a binding contractual obligation. If the situation is that the employer never had any option but to pay particular moneys to a superannuation fund, as distinct from making it available to the employee, the payment cannot properly be described as “wages”.

In the absence of evidence from the employer that no part, even $1 of the superannuation contribution was the result of a statutory or contractual obligation, I exclude the superannuation payment of $4,200 p.a.

I also add that, by curious coincidence, even if no part of the superannuation payment was excluded and every dollar was then taken into account in calculating relevant wages, the relevant wages in that calculation would be exactly $62,200 p.a., that being $58,000 plus 6% of $70,000 which is $4,200. The amount presently prescribed by Regulation pursuant to S170CD(2)(b) is $62,200 and Regulations made in accordance with Subdivision CA and S170CD require relevant wages to exceed not equal the applicable amount.

I reject immediately the proposition that the petrol card and the telephone expenses are part of relevant wages.

Given Ardino and Wolfer and the evidence tendered, I am not satisfied that the Applicant is excluded on the basis that relevant wages exceeded the cap in S170CD. I concede that evidence from Mr Licato might cast a different light on the actual negotiations because he seems to have been the sole real negotiator of salary and conditions with the Applicant but the Respondent did not call him to give evidence on this preliminary issue. At this stage I am not satisfied the Applicant is an excluded employee under S170CD and the hearing will continue.

ADDITIONAL COMMENT - 17 MAY 1996

The only additional comment I need to make on that issue is in respect of evidence yesterday (16 May) that the final payment for annual leave, like the employer’s superannuation contribution, appears to have been calculated on an annual salary of $70,000. I accept this was so but it does not alter the view I have already expressed that relevant wages within the terms of S170CD(1)(b) did not exceed the applicable amount using the formula set out in the sub-section.

It is not to the point that final annual leave entitlements and the employer’s superannuation contribution were both based on an annual salary rate of $70,000. It is not to the point that such payments were deliberately or inadvertently calculated on the basis of an annual salary rate of $70,000. The issue is relevant wages within the terms of S170CD(1)(b) and S170CD(2)(b).

The Court’s decision remains as expressed on the first day of the hearing for the reasons there expressed.

I need only add that there was nothing in the evidence of Mr Licata when he was finally called (by the Applicant not the Respondent) which causes the Court to alter the ruling made on 15 May on the first day of the hearing.

PROBATION

The Court has concluded that by 25 July 1995 the Respondent had determined to place the Applicant on probation by way of a three months trial period. It is possible that the Managing Director of both C T Freight and Pilot Freight, Mr C W Thomas, and the General Manager of C T Freight and Pilot Freight, Mr Toppenberg, and a Senior Company Officer with personnel and finance responsibilities, Mr Tony Bellamy, or any one or more of them, expected the Applicant, and for that matter Mr Taylor, to be placed on probation by way of trial period effective from 29 June 1995. However, there is no evidence that in the case of the Applicant (or for that matter Mr Taylor) that a period of probation was determined in advance of employment. There is no evidence that the Applicant (or Mr Taylor) were told of a trial period until, in the case of the Applicant he was provided with an appointment letter (Exhibit R2) dated 25 July 1995. According to the Applicant this letter was received by him early in August but nothing turns on that.

The letter of appointment under the heading, “Trial Period” states:

“your employment commenced June 26, 1995 with a three (3) month trial period, which may be terminated at any time within that period, by yourself or the company, by giving one (1) week’s notice. After the three (3) months trial period your employment may be terminated at any time by adhering to the requirement termination notice of one (1) week referred to under the heading Termination.”

In general, I am content to rely on Nicholson and Heaven & Earth Gallery Pty Ltd (1994) 1 IRCR 199 at 202 to 209 where the Chief Justice deals in considerable detail with exclusion from the operation of Subdivisions B, C, D and E of Division 3 of Part VIA of employees serving a period of probation.

This was not a period of probation determined in advance. Indeed, there was no notification of the probation until early August or late July at best. Furthermore, there is a real doubt that such a period of probation would have been reasonable in any circumstances involving an employee who was basically enticed, or at least actively invited, to leave a position he had held for some time in an industry in which he had worked for over 25 years.

In the circumstances here, where the probation was neither determined in advance or negotiated in advance, it was not reasonable having regard to the nature and circumstances of the employment. A confirming letter, more than a month after employment begins, does not make the period of probation reasonable. I cite the comments of the Chief Justice in Nicholson referred to the Court by Counsel for the Applicant at 208:

“However the submission provokes me to emphasis the desirability of employers confirming by contemporaneous letter the terms of engagement of employees. It is particularly desirable that they do this in cases where an employee is engaged on one of the bases referred to in Regulation 30B that is under a contract of employment for a specified period of time or for a specified task under a contract providing for a probationary or qualifying period of employment or as a casual employee engaged for a short period of time.

If the employment of such an employee is terminated and claim is brought under S170EA of the Act, employers may be assured that the judge or judicial registrar who hears the case will earnestly endeavour to determine the true terms of employment but evidentiary conflicts turning on different versions of conversations are notoriously difficult to resolve. With the best will in the world the Court may wrongly find against the employer’s claim that there was an oral arrangement making the contract one to which Regulation 30B applied. By contrast a contemporaneous letter, (and I emphasis contemporaneous), clearly specifying the terms of employment would probably ensure the employer’s success in defending the claim. Indeed, its mere existence may persuade the Applicant not to bring or persist with the claim. This in itself is a matter of moment. Even an employer who successfully resists a claim under S170EA will incur some costs and inconvenience. Employer organisations will serve their members well if they draw their attention to this matter.”

There was here no contemporaneous letter. There was not even any oral evidence, let alone contemporaneous written confirmation, of probation determined in advance. Probation was not determined in advance and it was not reasonable in the circumstances. The Applicant was not excluded from jurisdiction under Regulation 30B(1)(c).

THE RECRUITMENT OF THE APPLICANT

I have concluded from the evidence of Mr Toppenberg and Mr Licata that soon after the latter began at C T Freight having moved from a competitor, Wilson Australia, he approached the former (and probably Mr Clive Thomas also) and suggested there was scope for establishing Pilot Freight Pty Ltd in Melbourne as a customs broker. Some months or weeks later, and after Licata had been appointed General Manager of C T Freight in Melbourne, he again suggested to Mr Toppenberg that the time was right to establish Pilot Freight as a customs broker in Melbourne.

Mr Licata then approached his former Wilson Australia Freight colleagues, Stephen Potter, (the Applicant) and Geoff Taylor and Mike Dawson and prepared a Customs Brokerage Analysis (Exhibit R1).

Mr Licata may have made much earlier approaches to Messrs Potter, Taylor and Dawson but that is not relevant. The Applicant and Mr Taylor, and probably Mr Dawson, were consulted by Mr Licata and contributed to the preparation of Exhibit R1, but the document was the work of Mr Licata. He prepared it and submitted it to Mr Toppenberg and the proposal was discussed by Mr Licata and Mr Toppenberg, Mr Toppenberg and Mr Thomas and Mr Licata and Mr Thomas.

For the record the Court notes that Mr C W Thomas owns C T Freight and is Managing Director of C T Freight and Pilot Freight.

THE PROPOSAL TO EXPAND TO MELBOURNE - “THE BUSINESS PLAN”

In respect of these developments the evidence of Mr Licata and Mr Toppenberg is generally quite consistent. Exhibit R1 predicted capital expenditure on customs on-line fees, computer systems, publications and forms, recurrent expenditure on tradegate fees and software support and salary packages for the Applicant as senior broker/customs manager and Geoffery Taylor and Michael Dawson as senior brokers. In respect of salary packages it is clear that Mr Toppenberg authorised Mr Licata to negotiate the components of packages up to but not above $70,000 for the Applicant and up to and not above $60,000 for Mr Taylor. It is also clear that Mr Toppenberg rejected at least one approach from Mr Licata to expand the upper limit of the package proposed for the Applicant.

Customs brokerage revenues from July 1995 to July 1996 were predicted in Exhibit R1 with potential clients rated A, B and C in descending order of the likelihood of these clients coming on stream. While brokerage from A rated potential clients was estimated in July 1995 to July 1996 at $539,000 this could clearly have been no more than the most optimistic of maximum brokerage predictions and the brokerage estimates for B and C rated potential clients, at $380,000 and $1.5M respectively, could not be described as anything other than the height of wild optimism. It is clear from Exhibit R1 and the evidence of Mr Licata that no revenue was estimated as accruing in financial year 95/96 from the B and C rated potential clients.

The crucial figures in Exhibit R1 are at the conclusion of the four page document which reads:

“Achievable/Realistic Nett Revenues
(Customs Brokerage Only)

July 1995 - July 1996

Costs             $   225,372

Revenue       $   539,000

Nett Profit                  $313,628

July 1996 - July 1997

Costs             $   250,000

Revenue       $   898,352

Nett Profit                  $648,352

July 1997 - July 1998

Costs             $   350,000

Revenue       $1,122,940

Nett Profit                  $772,940”

Mr Toppenberg has given evidence that he relied totally on Exhibit R1 as a business plan and that:

1. the decision of Mr Clive Thomas, the owner of C T Freight, and of Mr Toppenberg himself to proceed with the establishment of Pilot Freight Limited in Melbourne in the premises of C T Freight and

1. the authorisation by Mr Toppenberg of the employment of the Applicant and Mr Taylor as senior brokers under the supervision of Mr Licata

were both decisions based entirely on the analysis in Exhibit R1

This is another way of saying that Messrs Toppenberg and Thomas accepted that the establishment of Pilot Freight Melbourne would be a viable and worthwhile business operation provided that the predictions in the customs brokerage analysis (Exhibit R1) were sufficiently achievable.

THE DISCONTINUATION OF THE MELBOURNE OPERATION

Mr Toppenberg’s evidence is that, if 50% or perhaps even 25% of potential A rated clients came on stream, he would have been prepared to continue the operations of Pilot Freight Melbourne (or I suspect, if the truth be known, recommend to Mr Thomas that the operation continue).

THE TERMINATIONS

The facts of the matter are that the Applicant began with Pilot Freight Melbourne as customs manager/senior broker on the 26 June 1995 and that on 7 September 1995 Mr Toppenberg told the Applicant and Mr Licata and Mr Taylor and a computer operator, Mrs Danni Paul, that the operation was finished and that they each would be paid four weeks salary and existing entitlements.

Mr Toppenberg in evidence described the payment of four weeks salary as a termination payment which was intended to be both in lieu of notice and as some compensation for retrenchment. By letter dated 15 September 1995 (Exhibit A1) Mr Toppenberg advised the Applicant as follows:

“Dear Steve,
With reference to your retrenchment from Pilot Freight Pty Limited effective Friday September 8, 1995 as advised at that time that monies due to you required final calculation and preparation for payment. These have now been completed and therefore please find our cheque enclosed being for:

4 Weeks Salary in lieu of notice                4461.56

Group Tax(1456.20)

======

3005.36

Car Allowance (4 weeks)    923.08

(Not subject to tax)

Annual Leave (pro-rata)

30.33 hours @ $35.90 per hour                 1088.77

Group Tax (455.00)

======

`633.77

$4562.21      

Should you have any questions on the above please do not hesitate to contact the undersigned.”

OPERATIONAL REQUIREMENTS

Having assessed the evidence of Mr Toppenberg for the Respondent and Messrs Licata and Taylor for the Applicant and the evidence of the Applicant himself, the Court is entirely satisfied that the Applicant’s employment was terminated because of operational requirements and that those operational requirements were a valid reason pursuant to S170DE(1). The Applicant sought to argue that the termination was not based on operational requirements and was for some other invalid reason other than for operational requirements and was brought about primarily because of the failure of the Respondent to provide an effective on-line computer system to allow the attraction and retention of clients particularly the A rated potential clients.

The Respondent states that the Pilot Freight Melbourne operation was disbanded with effect from the 7 September 1995 because only three of the potential clients (and according to Mr Licata, B and C clients) were recruited and that none of the potential clients rated A were definitely on stream by 6 September 1995 and because Pilot Freight Melbourne was costing about $5,000 a week, was receiving no revenue and according to Mr Toppenberg had lost about $100,000.

The Court accepts that Pilot Freight Melbourne was disbanded because between the 26 June 1995 and 6 September 1995 Messrs Licata, Taylor and Potter and particularly Licata had failed to attract sufficient or really any brokerage revenue and the parent operator C T Freight was not prepared to sustain further on-going losses. The defects in the computer system may have been a factor in the failure to attract clients but the Court doubts it was a major factor. Indeed Mr Licata gave evidence, which he later contradicted, that the computer problem was not an impediment in getting clients. The Court at this stage notes that it does not accept the evidence of the Applicant that certain potential clients were told by Mr Taylor that Pilot Freight Melbourne was not quite ready to accept them as clients because of the computer problems. This evidence was directly and forthrightly contradicted by Mr Taylor.

The Court also records that Mr Taylor and Mr Toppenberg were open,impressive witnesses of truth but the Court was less impressed with the evidence of Mr Licata and also the evidence of the Applicant when he was claiming that the real reason for the failure in the short-term of Pilot Freight Melbourne was general lack of support from management in Sydney and specifically the inability to iron out the computer problems. The Applicant’s version of Mr Taylor’s statements to potential clients about computer problems is inherently unlikely in the context of efforts to attract clients and Mr Taylor’s evidence to the contrary is accepted.

The failure to attract clients and revenue amounted to a valid reason for termination of the Applicant based on operational requirements of the Respondent and this is so irrespective of defects in the computer system or inadequate support from Sydney.

CONSIDERATION OF ALTERNATIVES TO TERMINATION

This was a genuine redundancy. However as Justice Spender stated in Mitchell-Collins and The Latrobe Council (1995) 60 IR 480 at 490:

“even in the case of a genuine redundancy the termination of a particular employee may be harsh, unjust and unreasonable.”

S170DE(2) reads as follows:

“A reason is not valid if having regard to all of the circumstances of the case including the employees capacity and conduct and those operational requirements the termination is harsh, unjust and unreasonable. This sub-section does not limit the cases where a reason may be taken not to be valid.”

The Full Commission of the South Australian Industrial Commission stated in Wynn’s Winegrowers Pty Ltd and Foster (1986) 16 IR 381 at 384:

“Even where there is a genuine need for a redundancy, the dismissal may be properly characterised as harsh, unjust or unreasonable for many reasons.....because the employee should not have been the person selected for redundancy, or because the employee could perhaps have been offered a suitable alternative position in the company’s employment, or because the method of dismissal might conceivably be considered harsh, or unreasonable, or because the length of notice given might be totally inadequate, or because the redundancy payment was in all the circumstances totally inadequate.”

The Wynn’s Winegrowers statement was cited with approval by Justice Beasley in Quality Bakers of Australia and Goulding (1995) 60 IR 327 at 336. In this case there is no evidence that the Respondent through Mr Toppenberg or Mr Thomas seriously considered suitable alternative employment for the Applicant, a forty-five year old man with twenty-five or more years experience as a customs agent, a man who had been deliberately recruited to assist in the Melbourne operation. There may not have been any suitable alternative employment within C T Freight Operations, certainly not in Melbourne, but there is no real evidence, other than a general statement by Mr Toppenberg, as to any real consideration of alternative employment discussed or offered anywhere in the C T structure. Mr Toppenberg, when questioned, simply stated that alternative employment was not available. He gave no evidence of any investigation of that possibility.

CONSULTATION

Under three other criteria in Wynn’ Winegrowers the termination seems harsh, unjust and unreasonable namely the method of dismissal, the lack of notice and the payment made allegedly in lieu of notice and because of redundancy. The dismissal came with no warning or consultation.

The Respondent, through Mr Ironmonger asserts, that the Applicant knew the company was not performing well. The Court accepts that. The Applicant indeed must have realised this was the case. However, as late as the 29 August, the Applicant was sent a copy of Exhibit R5, a memorandum from Mr Toppenberg to Mr Licata and that reads:

“Peter

I will be arriving in Meb PM the 3rd September and departing the following Saturday.

The reason for the visit is to assist in any way with the development of Pilot - CT, to make joint calls with you and Vince, to look at our EDP problems and to see what additional support we can provide to make Pilot a success.

I would like the four of you to get together and put a game plan forward so that my time in Meb is fully utilised particularly in the areas of sales and marketing.

Best regards”

Certainly if that memorandum is read in the context of telephone discussions between the Applicant and Toppenberg, and the Applicant and Thomas, and Licata and Toppenberg, and Licata and Thomas, it might be possible to conclude a degree of urgency in the Toppenberg visit to Melbourne. Nevertheless, it was written notice of intention to develop the project not kill it, or to use the words of several witnesses, including Mr Toppenberg, “pull the pin or pull the plug”. The pulling of the plug on the Applicant on 6 or 7 September, nine or ten days later, even though in financial and operational terms justifiable, was harsh and unreasonable in respect of the Applicant, particularly as the major responsibility for attracting clients lay with Mr Licata and not with the Applicant.

The Applicant was recruited for his expertise as a customs broker not for his ability to attract a large number of clients. The Respondent did not meet the criteria on consultation set out in Jones and Department of Energy and Minerals (1995) 60 IR 304 at 310 to 312 or in Corkrey and General Motors Holden’s Limited (1986) 53 SAIR 531 at 538.

Mr Ironmonger submitted that the lack of consultation or even discussion of the redundancy does not necessarily render a termination unfair or unlawful and in support he cited the majority judgment of the High Court in Byrne and Australian National Airlines (1995) 131 ALR 422 at 434 and the judgment of Justices McHugh and Gummow at 461. In both instances cited therein their Honours go no further than to state that a termination does not require the adoption of a particular procedure to avoid categorisation as harsh, unjust and unreasonable and that all the circumstances must be taken into account in determining whether a termination was harsh, unjust and unreasonable.

REMEDY

Taking account of all the circumstances, I am satisfied the termination on 8 September 1995 of the Applicant by the Respondent was harsh, unjust and unreasonable.

In all the circumstances I am satisfied the Applicant is entitled to remedy. Reinstatement is impracticable and conceded as such by both Mr Wraight and Mr Ironmonger.

Compensation should take account of the fact that while the Applicant was dissatisfied with some aspects of work at Wilson Australia his employment was reasonably secure there. He was actively recruited by Mr Licata on behalf of the Respondent and his new position amounted to a promotion. He is forty-five years of age. He has three children, two are still at home. He has not secured re-employment in his industry. He is actively seeking employment. It will be difficult for him with his seniority and at his age to get future employment as a customs broker at a junior level or at his previous level. The Applicant did not create the conditions which caused the redundancy.

Having considered the comments of Von Doussa J in Leddicot and Schiavello Commercial Interiors, Industrial Relations Court of Australia (unreported) Dec. No 569 of 1995, 18 October 1995 and Northrop J in Johns and Gunns Limited (1995) 60 IR 258, 272 and 273, I have concluded that the Applicant should receive the maximum compensation of six months salary reduced by post termination gross earnings of $3,120 and reduced by $200 because of leave entitlements paid on a notional salary of $70,000 and by another $200 because of the employer’s superannuation contributions made again on a notional salary of $70,000 a year.

As this is not a reinstatement, I make no reduction for unemployment benefits received and in accordance with the calculations above I award compensation of $25,840 which represents $29,000 (six months gross salary at $58,000 pa) less $3,120 post termination earnings, less $400 discounted for leave and superannuation calculations on a notional salary of $70,000.

MINUTES OF ORDERS

THE COURT ORDERS:

1. That the Respondent pay the Applicant compensation in the sum of $25,480 to be paid to the Applicant within 28 days of judgment today.

NOTE:  Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules.

I certify that this and the preceding 14 pages are a true copy of the reasons for judgment of Judicial Registrar Ryan.

Associate:            
Dated:  23 May 1996

Solicitors for the Applicant:             Slater & Gordon
Counsel for the Applicant:              Mr Wraight

Mr Ironmonger of Victorian Employers Chamber of Commerce and Industry appeared for the Respondent:   

Date of hearing:  15, 16 and 17 May 1996
Date of judgment:  17 May 1996