Ronghua Wang v CCIC Australia Pty Ltd

[2021] FWC 4718

[2021] FWC 4718

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Ronghua Wang
v
CCIC Australia Pty Ltd
(U2021/260)

COMMISSIONER WILLIAMS PERTH, 4 AUGUST 2021

Application for an unfair dismissal remedy.

[1] This decision concerns an application made by Mr Ronghua Wang (the Applicant) pursuant to s.394 of the Fair Work Act 2009 (Cth) (theAct) for an unfair dismissal remedy. The respondent is CCIC Australia Pty Ltd (the Respondent).

[2] The Respondent objects to the application on the ground that the dismissal was a case of genuine redundancy.

[3] At the hearing the Applicant gave evidence on behalf of himself. Mr Raymond He, the Manager of the Inspection Department, Mr Jacky Ning, the Supervisor of the Perth Workstation, and Mr Jisheng Lyu, the Respondent’s Managing Director, gave evidence on behalf of the Respondent.

Factual findings

[4] The Applicant was first employed by the Respondent in May 2015.

[5] The Respondent serves as an independent third party certification and inspection organisation providing inspection, verification, certification, and testing services with accreditation from the General Administration of Quality Supervision, Inspection and Quarantine of the People’s Republic of China (ASQIQ). 1

[6] At the time of his dismissal the Applicant was employed as an inspector in the Respondent’s Inspection Department in Perth.

[7] As detailed in the Applicant’s employment contract, he was responsible for:

•  Providing professional inspection services;

•  Keeping contact with yard/wharf to arrange inspections;

•  Keeping inspection records properly;

•  Reporting any abnormal issues during inspections;

•  Keeping good communication with the document team; and

•  Performing other tasks delegated by his managers and supervisor. 2

[8] Some of the Applicant’s evidence was not relevant to the question of whether his dismissal was a case of genuine redundancy.

[9] Relevantly, his evidence was that on 21 December 2020, he and another inspector both received an email notification that the Respondent proposed to terminate their employment by reason of redundancy.

[10] The email stated that the Respondent undertook a review of its operational requirements due to the significant drop in the inspection business in W.A. The email explained that, as a result of the review, the Respondent no longer required anyone to perform the Applicant’s inspector role. Accordingly, it proposed for the Applicant’s position to be made redundant.

[11] The email stated that the Respondent had not made a final decision to bring the Applicant’s employment to an end, and they wanted to provide him with an opportunity to give feedback or ask any questions about the redundancy.

[12] On 22 December 2020, the Applicant attended a video meeting with the Respondent where he was told that the company had no other position for him. The Applicant queried why they were making him, and one other inspector, redundant given there were three inspectors in Perth.

[13] On 24 December 2020 the Respondent gave the Applicant a letter stating that following the consultation meeting on 22 December 2020, the Respondent had determined that his inspector role was no longer required and therefore decided to make the Applicant redundant.

[14] The letter advised that the Respondent would pay the Applicant for his 4 week notice period however, he was not required to work out his notice period. The Applicant was also paid for 10 weeks redundancy, outstanding salary, annual leave and long service leave.

[15] I accept the Respondent’s evidence that, from 1 January 2021, the Chinese government banned the export of solid waste from Australia to China. The implementation of this ban was announced on 24 November 2020.

[16] The Applicant’s evidence however was that solid waste inspection in January through to October 2020 accounted for only 17.78% of his total working hours. I note that the Respondent challenges these calculations in that, the Applicant’s calculated solid waste inspection hours do not account for his work done after the inspection on site has been carried out.

[17] The Applicant’s evidence was that the Respondent’s business extends beyond inspecting solid waste. The business also exports many other products from Australia including:

•  Used machinery;

•  Iron ore and another minerals;

•  Grains;

•  Wines;

•  Hay;

•  Dairy products, including fresh milk; and

•  Pre-packaged products.

[18] The Applicant’s evidence was that there were other fields in which the Respondent could offer inspection and certification services.

[19] In regard to other suitable employment positions being available, the Applicant’s evidence was that on 31 May 2021 CCIC Traceability Ants Pty Ltd (CCIC Traceability) externally advertised, on the Seek website, for a Junior Marketing Assistant who spoke Mandarin and English.

[20] Mr He’s evidence was that solid waste is the major inspection business for the company’s inspectors. Solid waste inspection contributes the highest profit for the Respondent. However, the Respondent had to make a redundancy because the Chinese government ban of solid waste imports changed the company’s operational system.

[21] At the time of the hearing, Mr He gave evidence that there was only one inspector working at the Perth Workstation. The inspector has few inspections to do and has only carried out of 13 days of inspection from January to May 2021.

[22] Mr Lyu’ evidence, relevantly, was that the number of solid waste containers inspected in WA fell from 2761 in 2019 to 349 in 2020, which is a fall of 87%. In addition, from 1 January 2021 China banned the import of solid waste which heavily cut off the Respondent’s revenue. 3

[23] Mr Lyu’s evidence was that at the consultation meeting with the Applicant, Mr Lyu declined to discuss the situation of other employees in inspector positions for privacy reasons.

[24] In response to the Applicant’s calculation that solid inspection hours in 2020 comprised only 17.78% of his workload, Mr Lyu’s evidence was that in 2020 68 applications for inspection were undertaken by the Applicant. 60 of these inspections were of solid waste. In terms of inspection days, 68 were carried out in 2020 by the Applicant. 50 of these inspections were of solid waste.

[25] Since December 2020 the Respondent has not hired any new staff in their inspection department.

The legislation

[26] The relevant sections of the Act are set out below.

“385 What is an unfair dismissal

A person has been unfairly dismissed if the FWC is satisfied that:

(a) the person has been dismissed; and

(b) the dismissal was harsh, unjust or unreasonable; and

(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and

(d) the dismissal was not a case of genuine redundancy.

Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.”

“389 Meaning of genuine redundancy

(1) A person’s dismissal was a case of genuine redundancy if:

(a) the person’s employer no longer required the person’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise; and

(b) the employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.

(2) A person’s dismissal was not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within:

(a) the employer’s enterprise; or

(b) the enterprise of an associated entity of the employer.”

Consideration

[27] In summary the legislation above says that an unfair dismissal application cannot be made if the dismissal was a case of genuine redundancy.

[28] A dismissal is a case of genuine redundancy when:

•  The employer no longer requires the person’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise, and

•  The employer has complied with any obligation imposed by an applicable modern award or enterprise agreement to consult about the redundancy.

[29] A dismissal is not a case of genuine redundancy if it would have been reasonable in all of the circumstances to redeploy the person within:

•  The employer’s enterprise, or

•  The enterprise of an associated entity of the employer.

[30] The evidence is that, for a number of reasons, there were changes in the operations of the Respondent’s business. Firstly, the demand for solid waste inspections had declined over the previous 12 months. Secondly, from 1 January 2021, the Chinese government banned the importation of solid waste into China.

[31] These events had a significant negative impact on the Respondent’s revenue and operations.

[32] I accept the evidence that the Respondent undertook a review of its operational requirements and came to the decision that it no longer needed anyone to perform the Applicant’s job.

[33] That was a decision entirely for the Respondent to make.

[34] The Applicant, however, submits that he was wrongly selected for redundancy and that one other inspector had remained in employment.

[35] In the case of UES (Int’l) Pty Ltd v Harvey[2012] FWAFB 5241 a Full Bench of the Commission considered whether or not the process for selecting the particular person to be made redundant is to be considered by the Commission when deciding whether a dismissal was a case of genuine redundancy.

“[26] We have concluded, however, that s.387(a) of the FW Act regarding the matter of whether there was a valid reason for the dismissal related to the person’s capacity or conduct does not go to the process for selecting the person for redundancy. We have come to this conclusion having regard to the following factors and for the following reasons.

[27] The terms of s.389 of the FW Act suggest the process for selecting individual employees for redundancy is not relevant to whether a dismissal was a case of genuine redundancy. The relevant Explanatory Memorandum confirms as much. Setting aside jurisdictional pre-requisites and the matters in s.396(a) to (c), FWA only needs to consider s.387(a) concerning whether there was a valid reason for a person’s dismissal related to the person’s capacity or conduct if one or more of the criteria in s.389 of the FW Act, which sets out the meaning of genuine redundancy, have not been met. The criteria in s.389 which have not been met can be taken into account in FWA’s consideration as to whether the dismissal was harsh, unjust or unreasonable as part of s.387(h), being “any other matters that FWA considers relevant”.

[28] We think it unlikely that it was intended that FWA’s consideration of whether there was a valid reason for the dismissal related to the person’s capacity or conduct would extend to the process for selecting the person for redundancy when:

(i) the process for selecting a person for redundancy is not relevant to FWA’s determination of an unfair dismissal remedy application if the s.389 criteria for a case of genuine redundancy are met, and

(ii) any unmet criteria in s.389 of the FW Act can be taken into account as part of s.387(h) in FWA’s consideration as to whether the dismissal was harsh, unjust or unreasonable.

[29] To conclude otherwise would mean that where an employer met the s.389 criteria for a genuine redundancy the process for selecting the person for redundancy would not be a matter FWA would consider in respect of an unfair dismissal remedy application. However (unless the application was otherwise determined) an employer who did not meet the s.389 criteria because, for example, they failed to consult as required by s.389(b) of the FW Act would have both the failure to consult and the process for selecting the person for redundancy considered in any unfair dismissal remedy application.” (References omitted)

[36] I am bound by the Full Bench decision and so find that the selection process for the Applicant’s redundancy is not relevant to whether his dismissal was a case of genuine redundancy.

[37] As to the consultation, there are no submissions or evidence before me to suggest that the Applicant’s employment was covered by a modern award or enterprise agreement. There appears then to be no obligation to consult the Applicant about the redundancy.

[38] In any event, even if the Respondent had an obligation to consult the Applicant about the possible redundancy, the Respondent expressed their intention to do so, to the Applicant, in writing. Following that, a video meeting was held where the parties discussed the possible redundancy. Subsequently, the employer decided that they didn’t require anyone to perform the Applicant’s job. The Applicant was then advised of this decision in writing.

[39] Notwithstanding the absence of any obligation to properly consult with the Applicant, the Respondent did undertake a consultation process.

[40] The final question is whether it would have been reasonable in the circumstances to redeploy the Applicant.

[41] There is no evidence before me to suggest that, at the time of the dismissal, the Respondent’s enterprise had any suitable vacancies to redeploy the Applicant. Indeed, the evidence is that 6 months after the Applicant’s redundancy there still only remains one person undertaking inspection duties.

[42] Neither party made submissions as to whether CCIC Traceability is an associated entity of the Respondent, within the meaning of the Corporations Act 2001 (Cth).

[43] However, even if this separate enterprise was an associated entity of the Respondent, the Applicant’s evidence about the CCIC Traceability’s job concerned a job advertised 5 months after his dismissal. As a result, this was not a position he could have been redeployed to at the time he was dismissed.

[44] Consequently, I find that there were no reasonable redeployment options available at the time the Applicant was made redundant.

[45] Having considered all the circumstances in the legislation, my decision is that the Applicant’s dismissal was a case of genuine redundancy.

[46] Consequently, I uphold the Respondent’s jurisdictional objection.

[47] Because the dismissal was a case of genuine redundancy it cannot, by virtue of section 385 of the Act, have been an unfair dismissal.

[48] Consequently, this application will be dismissed and an order [PR732491] to that effect will now be issued.

Appearances:

R. Wang on his own behalf
J. Lyu on behalf of the Respondent.

Hearing details:

2021.
Perth:
June 18.

Printed by authority of the Commonwealth Government Printer

<PR732424>

 1   Exhibit A1, attachment 16.

 2   Exhibit A1, attachment 2.

 3   Exhibit R3, attachment 2.