Senol Kaysal v DBM Handrails Pty Ltd

[2010] FWA 8426

[2010] FWA 8426

FAIR WORK AUSTRALIA

REASONS FOR DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Senol Kaysal
v
DBM Handrails Pty Ltd
(U2010/9519)

COMMISSIONER BLAIR MELBOURNE, 3 NOVEMBER 2010

S.394 application for unfair dismissal remedy

[1] This decision (now re edited) was handed down in transcript on 21 September 2010.

[2] The Tribunal’s had an opportunity to look at the submissions, prior to today and heard verbal submissions and is in a position to give a decision.

[3] This is an application under section 394 of the Fair Work Act, an application for an unfair dismissal remedy. The applicant in the matter is Mr Senol Kaysal with DBM Handrails Proprietary Limited being the respondent. Mr Kaysal has approximately - or had approximately 16 years service with the respondent prior to his termination on 4 June 2010. That termination is alleged by the respondent to be a matter of genuine redundancy in that the downturn in the industry required for the company to reduce the number of employees it had in its service because of lost contracts and uncertainty of contracts coming up in the future.

[4] The company relies on the employees being aware of the downturn in the industry based on a notice issued on 23 March 2009. In that notice it says:

To all employees, due to lack of work please take notice of this letter to you. Please note that this is a union shop and this means that the policy of the last in first to go applies. If any personnel wish to move on and vacate their position with DBM they are welcome to state so because DBM is seriously needing to reduce the staff numbers due to having no work in the nature future so we encourage you to voluntarily leave. As you aware, at the moment there is a lack of work and if you are entitled to long service leave we encourage you to take it.

[5] In that instance, the Tribunal understands that Mr Kaysal, in fact, did take a large proportion of his long service leave to assist the company in that time of downturn.

The company, in relying on that notice, as an argument to indicate that the employees were aware at the time of Mr Kaysal’s termination on 4 June that there was still severe difficulties, I’m afraid does not hold much water with the Tribunal. There appears to have been a failure on the part of the company to properly communicate and properly consult with its employees about ongoing possible reductions in employment.

[6] If one looks at the section of the Act that determines genuine redundancy, section 389(1):

A person’s dismissal was a case of general 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.

[7] Reference has been made to clause 18, in particular 18.3 and 18.4, of the Union Collective Agreement 2008, 2011, between DBM Handrails Proprietary Limited v The Construction Forestry Mining and Energy Union. Mr De la Cruz’s evidence on behalf of the respondent was that a decision was made prior, that is sometime in May, to terminate the services of Mr Kaysal and that decision was made prior to 4 June, the date in which Mr Kaysal’s services were terminated.

[8] That appears not to be in conformity with clause 18.3 of the agreement, nor 18.4. Most certainly it does not appear to be in conformity with 18.5 of the clause. 18.5 of that clause refers to clause 10 which says:

The grievance procedure set out in clause 10 will apply in the event of any concerns arising out of regarding retrenchments.

[9] Clause 10 is headed Disputes Resolution Procedure. That is a detailed step by step process that appears not to have been followed by the respondent in this matter. There is an obligation on the employer to comply with the agreement as there is with on an obligation on behalf of the employees and the employee organisation bound by the agreement. That process has not been followed.

[10] As indicated, it would appear that management made a decision in early May to terminate the services of Mr Kaysal and Mr Kaysal was advised of that on 4 June 2010. Therefore, the company, in the Tribunal’s view is not allowed to rely upon 389(1)(b). In determining the genuine redundancy, the second issue goes to 389(2) which says:

A person’s dismissal was not a case of genuine redundancy if it would have been reasonable in all of the circumstances for the person to be redeployed within: (a) the employers enterprise; or (b) the enterprise of an associated entity of the employer.

[11] In this instance it would appear that 389(2)(b) does not apply, but most certainly 389(2)(a) in the Tribunal’s view does apply in determining whether there was a genuine redundancy. There is no argument that Mr Kaysal commenced employment some 16 years ago with the respondent in the factory and worked his way up from the factory floor to be an installer. Although it’s alleged that Mr Kaysal does not have any qualifications other than a ticket, as I understand it, to operate a boom, he does have experience within the factory.

[12] The evidence by the respondent says that out of some 25 to 28 employees, only three are labourers, which is the classification according to the respondent of Mr Kaysal. The respondent also confirms that Mr Kaysal is one of the longest serving employees out of those three (labourers), but most certainly one of the most longest serving employees within the company.

[13] So, therefore, the Tribunal is satisfied that 389(2) says that Mr Kaysal could have and should have been redeployed within the company’s factory operations and was quite capable of being redeployed into that area.

[14] Having determined that in the Tribunal’s view there was not genuine redundancy, the Tribunal must turn its mind to compensation understanding that the primary remedy to the Act is reinstatement. The applicant in this matter does press for reinstatement. I have to say that it’s a bit of quandary that the Tribunal finds itself because if the evidence is to be believed by the respondent, that is that there is still an uncertainty about possible work coming up, and it may be somewhat of a pointless exercise to reinstate Mr Kaysal into a position that may eventually become redundant if, in fact, the respondent doesn’t get the contract that it hopes to get.

[15] What I will do in this instance without determining a remedy at this point, I would provide an opportunity for the applicant, through Mr Wainwright, and the respondent, through Mr Egan, to try and come to some settlement in regards to this matter given that the Tribunal has determined that the termination of Mr Kaysal was not a genuine redundancy and, therefore, a termination that breached the Fair Work Act 2009.

[16] If the parties are unable to reach a settlement then the Tribunal will determine what the remedy will be taking into account the arguments put forward by the parties in this particular matter.

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