RHC Retail Pty Ltd T/A Rook Partners Asset Management v Diana Carr
[2025] FWC 152
•23 JANUARY 2025
| [2025] FWC 152 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.120—Redundancy pay
RHC Retail Pty Ltd T/A Rook Partners Asset Management
v
Diana Carr
(C2024/7466)
| COMMISSIONER SLOAN | SYDNEY, 23 JANUARY 2025 |
Variation of redundancy pay
RHC Retail Pty Ltd t/as Rook Partners Asset Management is in the business of providing commercial advisory, leasing and asset and property management services. As part of that business, it acts as the property manager for shopping centres across New South Wales.
Diana Carr was employed by RHC as Operations Manager for two such shopping centres (“Shopping Centres”). Her employment with RHC commenced on about 13 July 2020.
In 2024 the owner of the Shopping Centres was acquired by ISPT Pty Ltd. On 6 August 2024, George Fidler, RHC’s Director, Asset Management, met with Jason Hay of ISPT. (Mr Hay had previously been employed by the former owners of the Shopping Centres but had taken up employment with ISPT when it acquired them.) Mr Hay informed Mr Fidler that ISPT had decided to engage CBRE to manage the Shopping Centres in place of RHC (“ISPT Decision”). Mr Hay stated that the ISPT Decision was expected to be implemented on 1 October 2024.
As a result of the ISPT Decision, Ms Carr’s employment with RHC came to an end on 30 September 2024. In the circumstances, on the terms of s 119 of the Fair Work Act 2009 (“Act”) she was entitled to eight weeks redundancy pay.[1]
However, CBRE offered Ms Carr employment as a Facilities Manager, Property Management. Ms Carr accepted that offer. Her employment with CBRE (C) Pty Ltd commenced on 1 October 2024.
RHC contends that it “obtained” that employment for Ms Carr and that it was “acceptable alternative employment”. On that basis, RHC has applied to the Commission under s 120 of the Act for an order to reduce Ms Carr’s redundancy pay to zero.
Ms Carr opposes the application.
Determination
I am satisfied that RHC obtained acceptable alternative employment for Ms Carr, and that I should exercise my discretion to reduce her redundancy pay to nil.
My reasons follow.
Relevant law and principles
Section 120 is in these terms:
Variation of redundancy pay for other employment or incapacity to pay
(1) This section applies if:
(a)an employee is entitled to be paid an amount of redundancy pay by the employer because of section 119; and
(b)the employer:
(i) obtains other acceptable employment for the employee; or
(ii) cannot pay the amount.
(2) On application by the employer, the FWC may determine that the amount of redundancy pay is reduced to a specified amount (which may be nil) that the FWC considers appropriate.
(3) The amount of redundancy pay to which the employee is entitled under section 119 is the reduced amount specified in the determination.
The approach that I should take to RHC’s application is well established:[2]
a.I must first determine whether the pre-conditions for the application of s 120(1) are satisfied – that is, that Ms Carr has an entitlement under s 119 to redundancy pay, and (relevantly for this case) that RHC has obtained other acceptable employment for her.
b.Whether the alternative employment that RHC obtained is “acceptable” is to be determined objectively, not by reference to whether Ms Carr considered that it was subjectively acceptable. The determination of whether alternative employment is acceptable requires me to make an assessment and value judgment.
c.An employer “obtains” other acceptable employment when it acquires or gets the employment by its conscious, intended acts.
d.If I determine that the preconditions in s 120(1) are satisfied, my discretion under s 120(2) to reduce the amount of redundancy pay to be paid to Ms Carr is enlivened. As a result, it will be necessary for me to determine whether to make such a reduction and, if so, by how much. This requires the exercise of a broad discretionary power.
e.By reason of s 120(3), any determination I make for a reduced amount of redundancy pay becomes Ms Carr’s entitlement under s 119.
As I have already stated, the first pre-condition to the application of s 120(1) is met: Ms Carr has an entitlement under s 119 to redundancy pay. To determine whether the other preconditions are met I need to answer two questions:
a.Did RHC “obtain” Ms Carr’s employment with CBRE?
b.Was that employment “acceptable alternative employment”?
For the reasons that follow, the answer to both of those questions is yes.
Summary of the evidence
RHC’s evidence
RHC relied on two statements made by Mr Fidler. His evidence included the following:
a.From the time of his meeting with Mr Hay on 6 August 2024, Mr Fidler and other RHC employees engaged with ISPT and CBRE regarding the possibility of CBRE taking on those employees of RHC affected by the change, including Ms Carr. (For convenience, I will refer to these employees as “affected employees”. Unless the context suggests otherwise, a reference in this decision to “affected employees” includes Ms Carr.)
b.RHC provided information regarding the affected employees to ISPT and CBRE to facilitate offers of employment being prepared and made to them. In an email to Mr Hay of 19 August 2024 providing some of that information, RHC explored the basis on which an agreement might be reached for CBRE to recognise the accrued leave entitlements of any affected employee who took up employment with it.
c.On 3 September 2024, Mr Fidler met with Ms Carr to discuss the possibility of her employment being “transferred” to CBRE. He subsequently facilitated contact between CBRE and Ms Carr.
d.Mr Fidler engaged in correspondence with CBRE regarding the offers of employment to be made to the affected employees. Correspondence that he received from CBRE led him to believe that CBRE would recognise the affected employees’ periods of service with RHC and would “take on” the entitlements to long service leave, annual leave and personal leave that they had accrued during that employment (“Continuity Terms”).
e.On 16 September 2024, CBRE informed Mr Fidler that it had made an offer of employment to Ms Carr. However, Mr Fidler later discovered that the offer, and offers made by CBRE to other affected employees, did not include Continuity Terms.
f.Mr Fidler sent, and arranged for other RHC employees to send, further correspondence to CBRE with a view to clarifying whether CBRE was prepared to offer Continuity Terms to the affected employees.
g.The result was that RHC entered into an agreement with CBRE. Under that agreement, RHC agreed to make a payment to CBRE in an amount equal to the affected employees’ accrued entitlements to long service leave, annual leave and personal leave. In return, CBRE agreed to provide Continuity Terms to any affected employees who took up employment with CBRE.
h.Mr Fidler informed Ms Carr of this outcome in an email he sent to her on 27 September 2024.
On 30 September 2024, CBRE informed Mr Fidler that it intended to write to Ms Carr confirming that CBRE and RHC had entered into an agreement, and that CBRE would be recognising her accrued statutory entitlements.
j.On the same day, Ms Carr sent an email to Mr Fidler asserting an entitlement to payment in lieu of notice and redundancy pay.
k.Mr Fidler arranged for a letter to be sent to Ms Carr on 8 October 2024. The letter stated that as RHC had found her “a suitable redeployment opportunity” she had no entitlement to redundancy pay.
l.CBRE delayed sending RHC an invoice for the amount agreed to be paid under the agreement between the companies. Mr Fidler sent an email to CBRE on 2 December 2024 requesting that invoice. He also requested confirmation, consistent with the agreement, that from 1 October 2024 CBRE recognised the affected employees’ years of service with RHC and their accrued entitlements to annual leave, personal and carer’s leave and long service leave.
m.On 5 December 2024, Mr Fidler received an email from CBRE attaching the invoice that he had requested. The email confirmed that CBRE would recognise the entitlements that “transferred” employees had accrued at RHC. It further stated that CBRE would adjust the employment records for those employees to reflect those entitlements once RHC paid the invoice.
n.RHC paid the invoice on 6 December 2024.
o.CBRE has told Mr Fidler that Ms Carr’s employment records at CBRE should now reflect the employment entitlements that she accrued with RHC up until 30 September 2024.
p.Mr Fidler understands that Ms Carr’s position, duties and responsibilities at CBRE are substantially similar to the position she held as Operations Manager with RHC. She continues to service the Shopping Centres.
q.Mr Fidler has received written confirmation from CBRE that Ms Carr’s remuneration at CBRE is equivalent to, or higher, than that she was receiving at the time her employment with RHC came to an end.
Ms Carr’s case
Ms Carr’s evidence and contentions included the following:
a.On 8 August 2024, her manager, Harriet Watson, told her that she had received a call from Jason Hay of ISPT. Ms Watson told Ms Carr that Mr Hay had informed her that CBRE would be taking over management of the Shopping Centres from RHC; CBRE would “talk to the team for future employment”; and that this needed to be kept confidential as RHC was not aware of this.
b.When Ms Carr met with Mr Fidler and others on 3 September 2024, it was clear that RHC did not have any firm agreement with CBRE in place regarding Continuity Terms.
c.RHC managed the process with CBRE to protect its own commercial interests, not those of Ms Carr (or the other affected employees).
d.Ms Carr received an offer of employment from CBRE on 12 September 2024. It did not contain Continuity Terms. The offer was open for acceptance until 18 September 2024.
e.Ms Carr made enquiries of CBRE. She was told that CBRE was not offering Continuity Terms to her.
f.Ms Carr engaged in considerable email correspondence with Anne-Maree Kinley, RHC’s Human Resources Manager. In that correspondence, Ms Kinley recorded her understanding that CBRE had in fact agreed to offer Ms Carr with Continuity Terms, and that she would look into the issue. Ms Carr informed Ms Kinley that in the absence of CBRE offering her Continuity Terms, she “requested the pathway of redundancy”.
g.Despite the issue not having been resolved, Ms Carr accepted the offer of employment from CBRE on 18 September 2024. She did so in order to avoid the offer lapsing and being left unemployed. Under that offer, her employment with CBRE was to commence on 1 October 2024.
h.Ms Carr continued to correspond with Ms Kinley regarding CBRE offering her Continuity Terms. In that correspondence, Ms Carr maintained that she was entitled to a redundancy payment.
While Ms Carr received the email from Mr Fidler on 27 September 2024 referred to above, it did not reflect the reality. Her payslips from CBRE for October and November 2024 refer to her “Date of Joining” and “Service Date” as being 1 October 2024. A statement of her leave balances as at 30 November 2024 does not reflect accruals from her employment with RHC.
RHC obtained Carr’s employment with CBRE
From her material, I can infer that Ms Carr disputes that RHC obtained her employment with CBRE. Rather, she suggests that CBRE always intended to offer employment to her (and the other affected employees).
There is some force to that submission. The evidence does not reveal that RHC first suggested that CBRE offer employment to the affected employees. The possibility seems to have been contemplated by ISPT and CBRE from the outset.
But at the same time, RHC was not a passive observer to the process by which CBRE offered employment to the affected employees. It actively engaged with ISPT, and subsequently CBRE, regarding their continued employment. It provided information to facilitate CBRE preparing offers of employment and making contact with the affected employees. It took up with CBRE concerns that Ms Carr had raised regarding the terms of the offer she had received from CBRE.
Significantly, RHC ensured that CBRE provided Continuity Terms to Ms Carr and the other affected employees. I accept that the offer that CBRE first made to Ms Carr did not reflect such terms. But things changed. RHC entered into an agreement with CBRE, and made a payment to it, to ensure recognition of service and accruals.
There was clearly a delay in CBRE implementing that agreement. Ms Carr may have had cause for concern, including at the time she prepared her evidence in these proceedings, that the information she had received from CBRE did not reflect recognition of service and accruals. However, on all of the evidence I am satisfied that at the time Ms Carr commenced employment with CBRE, the Continuity Terms were terms of her employment.
RHC submitted that without its assistance, Ms Carr would not have been employed by CBRE. The evidence does not support that submission. However, I am satisfied that through its conscious, intended acts, RHC procured employment for Ms Carr with CBRE on the terms on which she ultimately commenced employment.
Ms Carr submitted that RHC had deliberately delayed conducting her performance and salary review in 2024. The result was that when RHC provided CBRE with details of her salary, without her consent, it effectively understated what she should have been paid. This disadvantaged her in that it provided a false premise on which CBRE might base an employment offer to her.
The evidence does not bear out the contentions as to RHC’s motivations. They do not rise above assertions.
In any event, it is not to the point that RHC’s conduct may have been motivated by a desire to derive a financial benefit. That is precisely what s 120 offers. The opportunity to avoid having to make a redundancy payment under s 119, in whole or in part, is the incentive for an employer to obtain acceptable alternative employment for an employee.
I am satisfied that RHC obtained Ms Carr’s employment with CBRE within the meaning of s 120(1)(b)(i) of the Act.
Carr’s employment with CBRE is acceptable alternative employment
Ms Carr did not challenge Mr Fidler’s evidence that her position, duties and responsibilities at CBRE are substantially similar to those she had at RHC, or that her current salary is commensurate with that she received at RHC. The documents suggest that her salary is in fact higher than it was before.
Ms Carr’s primary challenge to whether her employment with CBRE is acceptable alternative employment stemmed from her contention that CBRE had not provided her with the Continuity Terms. As I have stated, she had cause for concern in that regard. The information she had received from CBRE did not reflect the agreement between RHC and CBRE that she was told had been reached. This was not corrected until Mr Fidler made contact with CBRE in early December 2024, after Ms Carr had prepared and filed her evidence in these proceedings. (I can reasonably infer that Mr Fidler’s approach to CBRE was in part motivated by that evidence).
However, Ms Carr was told prior to taking up employment with CBRE that it would provide her with the Continuity Terms. I am satisfied on the evidence that the Continuity Terms form part of her conditions of employment with CBRE. This is not changed by the delay in CBRE reflecting those terms in Ms Carr’s employment records.
It is of no great consequence that the contract of employment with CBRE that Ms Carr signed on 17 September 2024 does not contain the Continuity Terms. An employee may have rights and entitlements beyond those which they have committed to writing.
I am satisfied that Ms Carr’s employment with CBRE is “acceptable” in the sense required by s 120(1)(b)(i).
Conclusions
I have established the jurisdictional facts required by s 120(1). I must now consider whether to exercise my discretion to reduce the amount of Ms Carr’s redundancy pay. In doing so, it is appropriate to balance the findings set out above against any considerations that might tell against the exercise of the discretion.
I do not consider there to be any significant considerations telling against the exercise of my discretion. I consider that it is fair and reasonable in the present circumstances to reduce Ms Carr’s redundancy entitlement to nil.
An order[3] will be issued separately reflecting this decision.
COMMISSIONER
[1] This was not a matter of controversy. I note for completeness that the exclusions in s 121(1) of the Act do not apply in Ms Carr’s circumstances.
[2] Australian Commercial Catering Pty Ltd v Marcelia Powell and Maria Togia; Marcelia Powell v Australian Commercial Catering Pty Ltd[2016] FWCFB 5467 at [35]-[38]
[3] PR783610
Printed by authority of the Commonwealth Government Printer
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