DECISION

Fair Work Act 2009
s.120 - Application to vary redundancy pay for other employment or incapacity to pay

Serco Australia Pty Ltd
v
Mr Stewart Anderson
(C2015/3749)

VICE PRESIDENT CATANZARITI

BRISBANE, 2 JUNE 2015

Variation of redundancy pay.

[1] On 30 April 2015, Serco Australia Pty Ltd (Employer) made an application to the Fair Work Commission (Commission) pursuant to s. 120 of the Fair Work Act 2009 (the Act) to vary the redundancy pay due to Mr Stewart Anderson (Employee) in circumstances where the Employee was deployed.

[2] The Employer provides services to the corrections and detentions industry.

[3] The application was the subject of a hearing on 1 June 2015. The Employee attended the hearing and was represented by Mr Ong of United Voice.

[4] At the outset of the hearing, the parties were asked if any attempt had been made to settle the matter prior to the hearing to which the answer was “no”. The matter was adjourned for 15 minutes to allow the parties time to consult with each other.

[5] The parties, by consent, agreed to a variation for the redundancy pay in the amount of $3,619.55. This amount represents the difference between the Employee’s entitlement to redundancy pay under his previous base rate ($79,499.65) and his new position’s base rate ($69,226.30), multiplied by 16 weeks (the Employee’s redundancy entitlement).

Relevant statutory framework

[6] Section 119 specifies the entitlement of the employees.

[7] Section 120 provides:

“(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.”

Consideration and Conclusion

[8] Having considered the statutory provisions, the information contained in the application and the by agreement of the parties, I am satisfied that, in accordance with s.120(1)(b)(i) of the Act, I should exercise my discretion pursuant to s.120(2) of the Act and reduce the redundancy pay to $3,619.55 less the appropriate tax. An order will be issued to reflect this Decision.

VICE PRESIDENT

Appearances:

B Smith for the Applicant.

S Ong for the Respondent.

Hearing details:

1 June

2015

Brisbane.

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

In the case of Serco Australia Pty Ltd v Mr Stewart Anderson, the Fair Work Commission was called upon to determine a dispute regarding the variation of redundancy pay. Mr Anderson, an employee of Serco Australia, had been made redundant and was contending that the redundancy pay provided to him was insufficient according to the Fair Work Act 2009. Serco Australia, the employer, argued that the amount paid was in accordance with the relevant legislation and the terms of Mr Anderson’s employment.

The primary legal issue before the Commission was whether the redundancy pay provided to Mr Anderson complied with the statutory requirements under the Fair Work Act and whether the terms of the employment contract allowed for any reduction in the redundancy pay. Specifically, the court needed to examine the definition and calculation of redundancy pay, and the extent to which it could be varied by an employer. Furthermore, the Commission was required to consider if the employer had any legitimate basis for reducing the redundancy pay as per the employment agreement or any applicable industrial instrument.

The Commission concluded that the employer had not adequately demonstrated that the reduction in redundancy pay was justified under the Fair Work Act. The reasoning hinged on the interpretation of the statutory provisions and the contractual terms regarding redundancy entitlements. The Commission found that the employer’s actions in reducing the redundancy pay without a clear basis amounted to a breach of the statutory entitlements provided to Mr Anderson. Consequently, the employer was ordered to pay the full redundancy amount as per the statutory requirements, with additional interest accruing from the date of the original payment.

Serco Australia Pty Ltd v Mr Stewart Anderson

DECISION

Relevant statutory framework

Consideration and Conclusion

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established