Smith v Edith Cowan University
[2023] FedCFamC2G 940
•29 August 2023
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Smith v Edith Cowan University [2023] FedCFamC2G 940
File number(s): PEG 187 of 2021 Judgment of: JUDGE VASTA Date of judgment: 29 August 2023 Catchwords: INDUSTRIAL LAW - Redundancy – notice period – whether misrepresentation as to payment of notice period if worked – whether EA should be construed as giving immediate effect to offers of redundancy – whether respondent “paid” the applicant – application dismissed – Costs – whether applicant committed unreasonable act Legislation: Fair Work Act 2009 (Cth): ss 50, 323, 345, 550, 570(2) Cases cited: Bevis v VA Holdings Proprietary Limited trading as Granton Homes [2020] FCCA 2082
Coote v Mainline Access Pty Ltd and Another [2019] FCCA 383
Division: Division 2 General Federal Law Number of paragraphs: 101 Date of last submission/s: 29 August 2023 Date of hearing: 28-29 August 2023 Place: Brisbane Solicitor for the Applicant: APX Law Counsel for the Respondents: Ms Millar Solicitor for the Respondents: HWL Ebsworth Lawyers ORDERS
PEG 187 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: DAVID SMITH
Applicant
AND: EDITH COWAN UNIVERSITY
First Respondent
CLIVE BARSTOW
Second Respondent
JENNIFER ROBERTSON (and others named in the Schedule)
Third Respondent
ORDER MADE BY:
JUDGE VASTA
DATE OF ORDER:
29 AUGUST 2023 AMENDED ORDER 13 OCTOBER 2023
THE COURT ORDERS THAT:
1.The application filed on 6 September 2021 be dismissed.
2.The Applicant pay the Respondents costs of the application fixed in the sum of $5,000 within 90 days of the date of this order.
THE COURT NOTES THAT:
A.The Court will not provide a written version of the reasons for judgment delivered today, unless an appeal has been lodged or the Court has received a request in writing from either party seeking that written reasons be produced.
B.Order has been amended pursuant to Rule r.17.05(2)(e) Federal Circuit and Family Court (Division 2)(General Federal Law) Rules 2021 to add “within 90 days of the date of this order” in order 2.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
(Ex Tempore)JUDGE VASTA
On 6 September 2021, the applicant David Anthony Smith filed an application in this Court seeking declarations be made against the first respondent, Edith Cowan University, and the second respondent, Clive Bairstow, that they had made a misrepresentation to the applicant pursuant to section 345 of the Fair Work Act 2009 (Cth) “(Fair Work Act”).
The application also sought a declaration that the first respondent and the third respondent, Jennifer Margarita Robertson, the fourth respondent, Arshad Omari, and the fifth respondent, Steven Kenneth Chapman, had contravened section 50 of the Fair Work Act by failing to comply with clause 18.11 of an enterprise agreement for Edith Cowan University, that being the failure to fully pay the entitlements that the applicant was due because of a redundancy.
The application also sought a declaration that the first respondent, third respondent, fourth respondent and fifth respondent have contravened section 323 of the Fair Work Act by failing to pay the applicant for performance of work.
The application sought compensation and pecuniary penalties.
The background of the matter is that the applicant had been working for Edith Cowan University from July 2007 until December 2019. He was a lecturer in the broadcasting section of the School of Arts and Humanities. He had a fairly distinguished career as a lecturer.
The applicant said that, over the years, he, like a number of academics, butted heads with the hierarchy of the university. He said that when it was that there was an expression of interest for persons to take voluntary redundancies because of a restructure of that particular school, he was keen to take advantage of that offer.
He said that, having been told about the voluntary redundancies, he decided to ask the human resources (HR) section to give him a little more information. The emails that he exchanged with Ms Churchill paint a picture of what it was that was on his mind at that time.
On 24 April 2019, the applicant wrote to Louise Churchill, who was the HR manager at the time, saying:
Hi, Louise, Following the Dean's email I am confident my application for voluntary redundancy will be welcomed. Can I seek a costing on what the redundancy package would be for me? Can I also ask for clarification on the suggested "end date", would this be the start of the 8-week period but with agreement could see me leave on that date?
Ms Churchill replied on 25 April:
Dear David, Thank you for your email. I will contact Payroll in the morning to arrange provisional calculations for you. As far as the end date goes, staff can include a preference to leave as soon as possible when they submit an expression of interest. Confirmation of the end date will come with the Panel's decision whether to accept the Eol. understand that the School will try to accommodate Eol staff preferences around finishing up, dependent on any teaching/marking from Semester 1. This is something which could be discussed confidentially with the ADD - at the time of submitting the Eol. I'll be in touch once I have the calculations from Payroll but please don't hesitate to contact me in the meantime if you have any other queries or questions following on from my response the above.
On 30 April, the applicant wrote again to Ms Churchill, saying:
Hi Louise. I was wondering when I might get the provisional numbers? Just to clarify if I nominated July 1st and it was accepted as my end date the first part of the redundancy (8 week period) would kick in from that date?
Ms Churchill replied later that day, saying:
Dear David. I have now received provisional calculations from Payroll Services. Payroll need a notional date to base their calculations and you will note they have used 24 May 2019. On the current timeframes, this will be the day after the Panel accept or decline expressions of interest in voluntary redundancy. If an exit date was agreed for 24 May, in your case you would receive payout in full for the 8 week transition period, 22 week notice period and the 32 week severance payment at that time. Please don't hesitate to contact me if you have any questions regarding the calculations, my advice above or other queries regarding the change process.
The figures were provided to the applicant that day, and it did determine that the commencement date of his employment was 16 July 2007, termination date would be 24 May 2019, so that he had completed 11 years and had given 4331 days of service to the University.
There would be payment for eight weeks transition, 22 weeks redundancy notice period and the number of weeks based on service. There was a net amount for retrenchment and then a net amount upon leave; that is, cashing in his entitlements for annual leave, annual leave loading, public holidays in lieu, time off in lieu, accrued long service leave and pro rata long service leave. All of that totalled a sum of $188,885.99.
The calculations bear the signature of the senior payroll officer who prepared it, checked by the payroll coordinator and reviewed by the team leader of payroll services, all three officers signing their names to that.
The applicant then wrote to Ms Churchill, saying:
Hi, Louise. Thanks so much for providing the figures, and I understand a nominal end date was used to work the figures out. I’m having a chat with Clive [Bairstow] tomorrow about a suggested end date. I have one question. With the teaching and marking I have remaining the earliest I can envisage departing is June 30, in which case the 8 weeks would take us past my work anniversary. Would the extra year service be added to the calculation and would the tax free aspect also be adjusted?
Ms Churchill replied, saying:
There will be an FAQ around this, but just so you know Panel approved expressions of interest in VR (only) will have the 8 week transition period paid in full as part of the redundancy payment. If you have an anniversary date at any point between the date of the calcs (24/5) and the date you leave then an additional two weeks salary would be paid as part of the severance component with the associated preferential tax treatment, however I see from the calculations a commencement date of 16 July - so if you left on 30 June this would not apply. FYI - periods of leave without pay are not counted as service so it could be that your anniversary date for the purposes of redundancy has been pushed out by 25 days - for the lwop 1 /8/08-26/8/08 included on your calculation sheet. If you want clarification around anniversary/commencement date if this varies from your records, then let me know so I can raise with Payroll.
I should add that there is absolutely nothing wrong with the applicant attempting to maximise whatever payout he can get, and there is no criticism of him for doing so.
According to the applicant, he had received those calculations. What he said in his affidavit was that Professor Barstow had made it clear to him that he (Professor Barstow) had the freedom to retain staff who applied for redundancy. Likewise, he could retrench staff who wished to remain.
The applicant said, in his affidavit, as he had in the emails to Ms Churchill, that he decided to apply, confident that, because of his previous criticisms of the management of Professor Barstow, his application was likely to be accepted.
The applicant said that he knew that Professor Barstow retained veto power over the panel’s recommendations. He said that he knew that the panel had recommended that his colleague, Jo McManus, be given a voluntary redundancy but that Professor Barstow had intervened and exercised his option to reject that panel’s recommendation.
The applicant said that he knew that his application was due to be lodged on 17 May and he was completing his final draft that afternoon. He said he was interrupted by that same colleague, Jo McManus. The applicant said that he knew that Ms McManus’ husband had recently passed away and that, four years previously, they had lost their 21 year-old son.
The applicant said that Ms McManus explained that she was struggling and that she was deeply concerned about how she would cope the following semester, especially if, as expected, the applicant departed in the latest change management process.
The applicant said that Ms McManus asked whether, if the university desired it, the applicant would consider staying until December 2019 rather than leaving in June. The applicant said he was unable to give her any guarantees that the university would ask him to stay, but he promised that he would speak to Professor Barstow about it. He said he went to the office of the Dean and was going to discuss the situation with him. He said that he began recounting the initial part of his conversation with Ms McManus to him and that he had only briefly explained the struggle that Ms McManus was having when Professor Barstow interjected and said words to the effect:
Let me head you off at the pass. If there is any way you would be willing to stay until December I would be delighted, and not just to help Jo. Of all the areas I am most concerned about how to replace the existing academic it's broadcasting and if you stayed it would give me six more months to work out how to replace you. It would also help the third-year students to have you teach out the course. The way I see it it's a win-win situation. We get the support and time we need, and you get 6 months more pay before you get your redundancy.
The applicant said that the Dean asked if he had been sent his proposed redundancy payout, and the applicant confirmed that he had. The applicant says that there was a discussion that followed where the Dean said words to the effect that the redundancy payment in 2019 would be slightly higher than the $189,000 that had already been calculated because the applicant would have completed another six months with additional leave among service payments.
The applicant said that the Dean did not offer financial advice, nor did he go outside what the applicant understood was the Dean’s area of authority. The applicant said that he understood that the two of them had agreed that the redundancy process would be deferred until the applicant had completed the additional work that the Dean had requested him to do.
This meant that the applicant was claiming that the second respondent represented that the redundancy process would be, effectively, put on hold and reignited after the applicant had finished work in December 2019. As far as that conversation is concerned, the second respondent agrees with most of what the applicant claimed, however, does not agree that that representation, that I have just detailed, was made.
What the Dean, Professor Barstow, says occurred was that the applicant approached him in his office to inform him that he had made the decision to apply for a voluntary redundancy. He said that the applicant asked him if he could continue working until 13 December 2019 to assist his close friend and colleague, Ms McManus.
The Dean said that he was aware that Ms McManus was experiencing difficulty following the death of her husband and that the applicant and Ms McManus had been very close friends for many years. The Dean said that he told the applicant that, if he stayed on until December 2019, it would be helpful to the school so that Ms McManus had support within the broadcasting department.
The Dean also said to the applicant that if he did not want to work until December 2019, the university and himself would arrange for Ms McManus to have adequate support in the broadcasting department.
The Dean said that, during that discussion, he commented that by the applicant working until December 2019, he would have the benefit of working six months extra. He would receive superannuation contributions for that six months extra work and that he could apply for other jobs during that time.
This is significant for the reason that an academic who is unemployed would not be as attractive an applicant to another university than one who was currently employed but looking for placements at another university, especially given the age of the applicant, which was 61 at this time.
The Dean claims that, during the conversation, he remembered telling the applicant that the applicant should get independent financial advice. The Dean said that he advised the applicant that the school would reimburse the cost of independent advice up to the value of $500 in addition to advice given or offered by the human resources team. He claims that he also advised the applicant that he, the Dean, would approve his request to continue working until December 2019.
He said that he did not make any comments, representations or guarantees to the applicant about what his redundancy entitlements would be when the voluntary redundancy took effect or any financial impact of his decision to work until December 2019. The Dean said that he knows that he did not make these comments because he always knew that he did not have the authority to make representations of that nature on behalf of the university.
He said, other than what he had told the applicant during the conversation about getting an extra six months of work and extra superannuation, he did not know how the applicant’s redundancy payment might be impacted by a decision to elect an end date of December 2019.
What occurred next was telling.
On 17 May 2022, the applicant submitted his application for voluntary redundancy. The last part of the form called for a suggested end date. The applicant gave two dates, 30 June 2019 or 13 December 2019. The panel met on 22 May and, of 22 applications for voluntary redundancy, the panel recommended 18.
There were four applications that were not recommended, and there was another recommendation for an involuntary redundancy. Those recommendations were given to the Senior Deputy Vice Chancellor who signed off on them.
This, then, caused the director of human resource service centre, Ms Jennifer Robertson, to write the following letter to the applicant on 23 May 2019. It was headed Private and Confidential and given a header of Request for Voluntary Redundancy:
I refer to the School of Arts and Humanities organisational change proposal distributed on 24th April 2019 and the subsequent decision conveyed to staff on 13th May 2019 to proceed with the reshaping of its academic profile in the programs offered by the School.
Following the University's invitation for staff to submit expressions of interest in voluntary redundancy, a Panel convened on 22nd May 2019 to consider your request. This letter is to formally advise you that the Panel has approved your request for voluntary redundancy under the terms of the Edith Cowan University Enterprise Agreement 2017 (the Agreement). Your Redundancy Notice Period will commence on 24th May 2019 and your employment with the University will cease on 13th December 2019.
All terms and conditions of your appointment will continue until your employment with the University formally concludes.
As a consequence, the redundancy provisions within the Agreement now apply to you. You will receive payment in accordance with Clause 18.11 of the Agreement, including payment in full of the 8 week Transition Period and any balance of the Redundancy Notice Period not worked.
Human Resources will forward to you a Final Calculation one to two weeks before you leave the University to ensure the Final Calculation incorporates any leave you may take between now and your final day of work. In order for Payroll to release your final payment, the University will require receipt of a signed and dated copy of your Final Calculation. Please forward this to [email protected].
Please note that the Agreement does not permit staff to be re-employed or undertake any paid work at the University for a period equal to the number of weeks' payment received at Clause 18.11 (i) to (iii) of the Agreement.
As a departing staff member you have a unique perspective from which to comment on our organisation and we would appreciate if you could take the time to complete an exit survey to provide your feedback. An exit survey will be forwarded to you separately closer to your exit date.
If you are seeking superannuation advice, please contact UniSuper to make enquiries or an appointment at their Perth city office or arrange an on-campus meeting.
I would like to take this opportunity to remind you that the university provides a free and confidential counselling service through its employment assistance program for staff and their immediate family members.
If you have any questions or matters you wish to discuss, please contact the school’s HR business partner, David Benetti, by telephone or by email.
On behalf of the university, I would like to take this opportunity to thank you for the contribution you’ve made to the university, and I wish you every success with your future endeavours.
Yours sincerely, Jenny Robertson.
The applicant did have questions, but he directed them to Ms Churchill, with whom he had corresponded, leading up to his submission of the voluntary redundancy expression of interest. On 24 May 2019, the applicant wrote to Ms Churchill, saying:
Hi Louise,
I have now been notified my application for voluntary redundancy has now been accepted with a final employment date of Dec 13 2019. Could you please supply provisional calculations for the redundancy payment for that end date?
I also seek an explanation for this element of the approval
"Your Redundancy Notice Period will commence on 24th May 2019 and your employment with the University will cease on 13th December 2019.
All terms and conditions of your appointment will continue until your employment with the University formally concludes.
As a consequence, the redundancy provisions within the Agreement now apply to you. You will receive payment in accordance with Clause 18.11 of the Agreement, including payment in full of the 8 week Transition Period and any balance of the Redundancy Notice Period not worked."
When exactly would the 8-week payment kick in as it is my assumption the redundancy elements would not be paid until the completion of service on Dec 13.
Ms Churchill replied on 27 May, saying:
Dear David. We will contact payroll regarding another provisional calculation and get back to you on this.
All redundancy payments are made in the next available payday after finishing up, ie December. At this time you will receive the 8 week transition period as a lump sum, together with the severance payment based on years of service and accrued leave.
As explained in the provisional calculations, the notice period may be worked and paid as salary, paid out as part of the final payments or a combination of both totalling 22 weeks depending on when a staff member finishes up. In your case this means you will receive salary (with the benefit of 17% super and accruing leave) for an extended notice period of around 29 weeks as the required 22 weeks' notice ends on 28 October.
I will be down at Mt Lawley this afternoon and would be available to catch up some time between 3 and 4 if you'd like to meet to discuss.
And Ms Churchill did meet with the applicant later that day, that is 27 May. She said, as far as that conversation was concerned, that the applicant asked her about the notice period that was included in the calculations. She said that she explained to the applicant about the notice period. She said that it could be worked, paid out or a combination of both.
She confirmed with the applicant that, if he finished in December 2019, he would work the 22-week notice period in full. She said that, in effect, finishing in December would amount to approximately 29 weeks from when the applicant was put on notice that he would be made redundant, to the date that he left. She said that she told him that he would get the benefit of an extra seven weeks full salary.
She told the applicant that if he worked up until December, he would get the benefit of superannuation of 17 per cent, for the whole period, from May to December, which he would not get if he accepted his redundancy and finished his employment in May. She said if that had happened, in that case, his notice would be paid out in May and no superannuation would apply.
She said that she also explained that if he worked until December, by working his notice period, he would be accruing additional leave while he was working. She said that she talked to the applicant about what was in the enterprise agreement. She said that the applicant had knowledge of the provisions and his entitlements within the EA, in her opinion.
She recollected that she and the applicant did a back of the envelope calculation as to how he would not be worse off financially, working through the notice period until December 2019. This took into account the 29 or so-weeks salary, less associated tax, the 17 per cent superannuation and his accrual of additional long service leave and annual leave, which would be approximately two weeks, compared to a lump sum payment equivalent to 22 weeks, if he nominated to finish up in May or June.
She said that when they did those rough calculations, they would not have discussed exact amounts, as she would always go to payroll for that. But for the purposes of the rough calculations, she remembered reminding the applicant of the additional salary for working beyond 22 weeks of the period October to December, the 17 per cent superannuation, how much extra leave he would accrue, and what that was worth to him in rough dollar terms, in comparison to the 22-week lump sum payment in lieu of notice, if he nominated to finish up in May.
She said that she remembered explaining to the applicant that the severance payment increases for every year of completed service – that is, two weeks for every year after the first 10 years, so that if he stayed past his anniversary date, the amount of severance pay he was entitled to would increase by two weeks. She recalled that this meeting with the applicant was not difficult or challenging.
She said that she would not say that the applicant was happy about what she said, but he did not challenge it, and she believed that he understood what it was that she was saying to him. She explained that by saying that the applicant was not happy in the meeting, her memory was that this was because he did not agree with the concept of working during the notice period.
After that meeting concluded, there was no other contact by Ms Churchill with the applicant for some time. The applicant did receive a revised calculation in June of 2019. That revised calculation included an end date of 20 December 2019. Because there were some tax changes in the federal budget that came into force on 1 July 2019, the applicant received a further amended calculation.
This calculation had the end date, again, as 20 December 2019, but with a final net payment of $153,964.27. It had no payment for the notice period. The applicant did not raise any issues about either of the revised calculations with anyone.
The applicant gave evidence, which was not in his affidavit, that he had tried to talk to Professor Barstow, but could only contact his assistant verbally, and was told that there was no opportunity for him to see Professor Barstow.
The applicant said that he did not do anything further, after receiving all this information. The applicant was asked why he simply did not refuse to work until all this was sorted out, and he replied that he did not want to go back on the agreement that he had made with Professor Barstow.
He said that he came to the realisation he would not be able to see Professor Barstow until the teaching portion of the semester had concluded. He said that he believed that when Professor Barstow learned of what had occurred, that Professor Barstow would be able to step in and fix it.
The applicant said that in November 2019, he had spoken to another colleague. That colleague was in a similar predicament to himself, and she had told the applicant that she did not get the payment that she thought she would get.
From then on, the applicant sent emails and spoke to whomever he could about his dispute. I will not read all of the emails that were sent, but I have selected three emails that really get to the gist of what it was that the applicant was complaining about. The first email that was sent was on 8 November 2019. It was sent to Ms Churchill. The applicant wrote:
Hi Louise, I hope you’re well. I am writing to query the final payment notice. The EBA says those accepting voluntary redundancy will receive the payments as outlined in 18.11. This includes 22 weeks pay in 18.11 (b)…
The applicant then reproduced clause 18.11 of the EA. The applicant further wrote:
There is no stipulation in the EBA that by agreeing a later departure date will mean 18.11 (b) will be removed from the entitlement.
In my case I agreed to stay on longer to help ECU. Clive Barstow said I would be doing him a huge favour to stay on until December to teach out the year and the fact I have been paid for my services for the extended period is immaterial.
Due to these circumstances and the wording of the EBA I believe the 22 weeks entitlement as specified in 18.11 {b) should be re-applied to my payment.
On 26 November 2019, the applicant wrote to Ms Churchill, Stacey Lynn and Donna Shepardson, as well as to Professor Barstow. The applicant wrote:
Hi Stacey, Louise, Donna and Clive,
I have just come from a meeting with Clive Barstow where he has informed me that it is HR's belief they have acted in good faith regarding the removal of the 22 weeks portion of the redundancy payment. I wish you to consider these elements.
In May I was approached by my colleague Jo McManus who has been struggling this year following the death of her husband Rod in February. This sad event followed the death of her eldest son Max some years earlier. In both cases I stepped in to provide whatever support I could including undertaking extra teaching. Jo knew I was keen to leave via voluntary redundancy at the earliest point but asked if I would consider staying on if ECU thought they wanted that to happen.
I met with Clive Barstow and started to explain Jo's thinking and he interrupted to explain I would be doing him and ECU a massive favor if I would stay on until December. He was unaware that there were any implications on the final payment believing like me I would get the sum I had been advised of plus a little more for having worked another 6 months and passing my anniversary date. Clive like me was unaware the notice period would be maintained as June and not altered to December.
This was a very special circumstance. The university has done everything possible to help Jo in her time of distress, yet in the case of those who helped her the most there is no consideration at all. Jo was absent for much of the first semester and I worked flat out to maintain my own teaching as well as help Andrea Burns with the Post Grads. Jo has been back more in the second semester but I have played a crucial role in helping her through this difficult period.
I am 62 in April. I am unlikely to be fully employed again. Every cent counts. Clive and I reached an agreement that was based on me getting my full redundancy payout after helping out ECU. So I would like you to consider these special circumstances and adjust the end date to allow the payment we all believed I would be getting.
I am still hoping some consideration will be applied to a special circumstance.
On 7 December 2019, the applicant wrote:
In May I was advised my redundancy payout would be $188,885.
Due to the removal of the 22 weeks notification period the sum was reduced to $153,964, a loss of $34,921 after tax. My salary for working 6 months as a level C is $69,614 with $16,510 deducted for tax, leaving $53,104.
This means I just worked 6 months at ECU's request for the grand total of $18,183. In the breakdown of numbers, you can see how inequitable this decision was.
Those who left in June and found another job gained their full redundancy entitlement plus their full salary. Those retained by ECU got their full wages, but those who agreed to help ECU by delaying their redundancy got punished in the most punitive fashion.
Surely you can see that an injustice has occurred and will want to rethink this situation.
The emails kept going. On 2 January 2020, Professor Barstow wrote the follow email. Writing to the applicant, he wrote:
Hi David, I'm happy to put into an email what I have discussed with you and the basis of my discussion with HR, which is pretty much around the issues that you highlight.
As you point out, had I understood the financial ramifications of any staff member staying on for an extra six months I would at least have pointed this out so that they could have made a decision partly based on accurate financials. I honestly thought that offering you an extra six months of work would not disadvantage you financially, in fact I assumed it would give you six months extra salary, time to apply for a new position while employed at ECU for an extra six months, and an extra period of employment to add to your calculation for redundancy.
It is not my job to give financial advice of course and I was careful not to do this with anyone in the process of change. This is why I agreed for the School to cover the costs of a financial advisor to help affected staff make decisions based on the rules around the EB. My job is to look after the interests of the students first which is why in yours and Dianes case we agreed an extra six months to cover a difficult period of transition, for different reasons obviously.
I know that some of my affected staff did take financial advice during the change process, and on the basis of that decided not to stay on for an extended period where it might have advantaged the students in similar circumstances. I assume therefore that they became aware of the financial ramifications and decided to leave in mid year.
My disucssions with HR were around your individual case based on the problems that Jo was facing at the time. You and I both thought this solution was an equitable way of solving a difficult problem at the time and our discussions were colleagiate (sic) and professional and for all the right reasons. As I say. had I or you realised the financial implications of this, the discussion might never have taken place and I would have respected that and would have had to find an alternative way of managing the situation.
I understand HR’s pint of view too in that this would technically be a double payment and set a precedent for anyone taking redundancy, but I did put the special case forward because we both had Jo’s interests at heart.
The applicant claims that he was the subject of a misrepresentation. Section 345 of the Fair Work Act, subsection 1(a) stated that:
A person must not knowingly or recklessly make a false or misleading representation about the workplace rights of another person.
The applicant claims that the Dean, Professor Barstow, made a false or misleading representation to him about his workplace rights, namely his redundancy payout. The applicant says that this was at the very least, reckless.
The misrepresentation is that the redundancy process would be paused and revived in December 2019. The question for me to decide is whether such a representation was actually made. The representation that the redundancy process would be paused and revived in December 2019 is denied by Professor Barstow.
What is curious, in the emails between the applicant and Ms Churchill that followed the meeting with Professor Barstow, is that the applicant did not raise any such claim with Ms Churchill.
If it were that Professor Barstow had made such a representation, it would be incongruous with the applicant putting two dates in his voluntary redundancy application. I simply cannot see that, if the applicant had reached the agreement with Barstow that he says he reached (that is, a redundancy process would be paused and revived in December 2019), why it is that the applicant put two dates in his application.
More importantly, it is incongruous that the applicant would not have included the fact that the voluntary redundancy for which he was applying had, by agreement between himself and Professor Barstow, been one that would not occur until December 2019.
It is also incongruous that if that were his true belief that such an agreement had been made, and had been accepted, why he did not say anything of this to Ms Churchill.
Because all of the actions of the applicant are incongruous with that representation having been made, it seems to me that it is more likely that the representation made by Profession Barstow was the representation that he says was made in the email he wrote on 2 January 2020, that is, that this was a special case.
The applicant himself, in the emails that I have referred to of 8 November, 26 November and 7 December, talks about the special circumstances, that is, the support needed for Ms McManus. It does not mention that this was, regardless of the support, an agreement that there would be a reviving of a paused redundancy program after December 2019.
For that reason, I find that the applicant has failed to prove that a misrepresentation was made and therefore the claim, that section 345 of the Fair Work Act was contravened, fails.
The second claim is that the first, third, fourth and fifth respondents contravened section 50 of the Fair Work Act by contravening the term of the Enterprise Agreement. This claim is based on an extremely novel construction of the Enterprise Agreement, in particular, clause 18. Clause 18.2 reads that:
For the purposes of clause 18, the following definitions will apply:
Transition Period means the 8 week period commencing on the date the employee is notified in Clause 18.5 their job is to be made Redundant.
Redundancy notice period means an employee’s defined notice of termination described at clause 18.11(b), which is in lieu of any other notice period under this agreement.
Redundancy has the meaning at clause 18.4, which reads:
Redundancy means: Where the employee's employment is terminated at the University's initiative, because the University no longer requires the job to be done by anyone, except where this is due to the ordinary and customary turnover of labour.
Clause 18.7:
The University may call for voluntary expressions of interest in redundancy, and employees may elect to express their interest in being selected for voluntary separation. The University may at its discretion, select or decline to accept an employee's expression of interest in redundancy. The University may, at its discretion make offers to employees to accept a voluntary separation.
Clause 18.11:
An employee who elects voluntary separation or who is retrenched will receive on termination of employment the following payments:
(a) the payment in lieu of any unexpired period of the eight-week transition period;
(b) payment in lieu of any unexpired period of the redundancy notice period.
And for someone who was over the age of 45 years, that was 22 weeks:
(c) payment of severance on the basis of 3 weeks' salary for each year of continuous service for the first 10 years and 2 weeks per year of continuous service for subsequent years of service;
(d) payment on a pro-rata basis for long service leave;
(e) payment of any annual leave and any pro-rata leave loading
provided that the total possible payment from clauses 18.11(b) and 18.11(c) combined will not exceed 70 weeks payment.
Clause 18.13:
The employee may request to work all or part of the Redundancy Notice Period, and the University may agree, or decline an employee's request. Where a request is agreed the employee upon termination will receive payment in accordance with Clause 18.11 including any balance of the Redundancy Notice Period not used.
The novelty of the submission of the applicant is this. The applicant submits that, when the university has said that the job is not required to be done by anyone, then the job instantly ceases to exist. In this case, the university had declared that, from 24 May 2019, the job ceased to exist.
This means that the definition under 18.2, that is, redundancy notice period, means an employee’s defined notice of termination, prescribed at clause 18.11(b), which is in lieu of any other notice period under this agreement, means that the notice period is not really a notice period at all, but rather, it becomes a calculation of a sum of money that would be equal to the appropriate number of weeks specified.
In the present case, the consequence is that “notice period” means a sum of money that is calculated as being 22 weeks of pay. What this means is that, as at 24 May, the job no longer existed and that the applicant lost any right to continue to work for the university, as at 24 May 2019. However, it meant that the university was then liable to pay all of the sums that had been calculated. In this case, it meant that the university was obliged to pay the applicant the $188,889 immediately and that would then be the end of their employer/employee relationship.
What this meant is that the letter, that was sent on 23 May, was a breach of the EA. It also meant that the application by the applicant was an invitation for the university to breach its own EA, given that the applicant had already been told in those emails that the end date was going to be 24 May 2019.
There may be some peripheral attraction to this interpretation, but it seems to me that to interpret clause 18 in this way is to excise it from the rest of the enterprise agreement and to give it a meaning that is not consistent with the rest of the enterprise agreement.
Clause 18 is a clause that only relates to academic employees. There are clauses that relate to the redundancies of professional employees and other employees, as well. With regard to academic employees, it seems to me that clause 18 is a recognition that the university may, in its ultimate discretion, come to a decision that it no longer wishes to have anyone work in a particular position. Having made that decision, it would be jarring, to say the least, to inform someone that, having made that decision, it comes into effect immediately. What it does, however, is set a date from which a notice period can be calculated.
For that reason, clause 18.11(b) exists, so that a person who is made redundant can continue to work to ensure that they have sufficient time to readjust to the fact that their position no longer exists. This is why the clause talks of unexpired periods of the redundancy notice. Unexpired period of a redundancy notice would have no meaning at all if redundancy notice period was interpreted as simply an amount of money defined by the specified number of weeks paid. It is a “period” because it is a “period” of time for someone to leave.
It is instructive that the applicant himself, even if he did not take up the offer to keep teaching at the university until December, did not wish to leave until 30 June so that his redundancy would take place on the first of July, that being a new financial year. But also, as he explained, because he wished to continue the job that he was actually doing. If that had happened, then he would have worked during some of the period of the notice, so that, once he came to his specified end date, he would be paid the unexpired portion of his notice period, having worked and been paid salary, plus superannuation, and accruing leave entitlements during the notice period in which he actually worked.
Clause 18.13 is simply the facilitating of any particular desire of a person to stay longer than the end date, which can be accepted or refused by the university. If it is accepted, then it simply is a throwback then to what clause 18.11(b) states. If that is the correct definition, it means that the university has complied with the enterprise agreement; that is, it has decided that the job that the applicant is performing is no longer needed, but has determined, through the application process, that the job should cease on 13 December, which was later moved to 20 December, to accommodate the applicant. That is in keeping with the tenor of the enterprise agreement as a whole.
What that means, though, is that the applicant has worked through the notice period of 22 weeks and has worked even longer. At first blush, I was somewhat surprised, but I accept the evidence of the senior deputy vice-chancellor, Professor Omari, who said that this is not at all unusual, because there are academics who will take the redundancy but will do so after it is that they feel comfortable to leave the post.
It seems to me, then, that the university did comply with the terms of the enterprise agreement and the applicant has failed to show that there has been any contravention of section 50 of the Fair Work Act.
The third claim was that the university had contravened section 323 of the Fair Work Act. Section 323(1) provides:
(1) An employer must pay an employee amounts payable to the employee in relation to the performance of work:
(a) in full (except as provided by section 324); and
(b) in money by one, or a combination, of the methods referred to in subsection (2); and
(c) at least monthly.
The important phrase in that section is the phrase “in relation to the performance of work”. That connotes salary. It does not connote redundancy pay. The authorities of Coote v Mainline Access Pty Ltd and Another [2019] FCCA 383 and Bevis v VA Holdings Proprietary Limited trading as Granton Homes [2020] FCCA 2082, both decisions of His Honour Judge Manousaridis, specifically dictate that redundancy pay is not pay for the performance of work.
It seems to me that even if the two authorities of His Honour were not available to me, a plain reading of section 323 makes it obvious that it is payment for the performance of work. Even if it were not that, the university has paid the applicant what it was that they needed to pay him under the enterprise bargaining agreement. The claim under section 323 fails.
I should note that during the course of submissions, the applicant withdrew the claim pursuant to section 323 for the same reasons that I had indicated, having regard to the authorities that I have cited from Judge Manousaridis.
I should also say with regard to the claim regarding section 50 that the third, fourth and fifth respondents were made parties to this whole action on the basis they were involved in the contravention of section 50, which was not complying with a term of the enterprise agreement. The non-compliance of the term of the enterprise agreement, on the submissions of the applicant, occurred on 24 May 2019. There is no evidence that linked the third, fourth or fifth respondents with any actions leading up to 24 May other than the letter sent by Ms Robertson in her role. It seemed to me that it could never have been properly alleged that either of the three were involved.
Having come to all of those conclusions, the result becomes somewhat inevitable. Having said that, the Court should not be understood as being without sympathy for the plight of the applicant. But it seems to me that, for the applicant to have been given by the university what it is that he was asking for, was to treat him as he asked to be treated, namely as “a special case”. This is because there was no legal entitlement for the university to do anything other than what it did.
That is what this Court must decide: whether there is a legal entitlement and whether the applicant has proved that there was a legal entitlement.
It seems to me that, realistically, the applicant has tried to prove that he is a special case where the Court should look at his predicament and base its decision upon a feeling of sympathy for him. The Court simply cannot do that.
The respondent has made an application for costs. They have given to me correspondence which I will mark as exhibit 4 in these proceedings. The correspondence is a letter dated 19 November 2021 from the respondents’ solicitor to the applicant’s solicitor; correspondence dated 30 March 2022 from the respondents’ solicitor to the applicant’s solicitor; correspondence dated 20 December 2022 from the respondents’ solicitor to the applicant’s solicitor which included a notice of offer to compromise; a letter on 1 June 2023 from the respondents’ solicitor to the applicant’s solicitor and a letter dated 23 August 2023 from the respondents’ solicitors to the applicant’s solicitors. I will make them all exhibit 4.
Section 570(2) allows the Court to make an order for costs only where it is that the Court is satisfied that there has been an unreasonable act on the part of the one party that has caused the other party to incur costs. The unreasonable acts in this case on the correspondence before me are the following.
Firstly, the persistence of claims against the fourth and the fifth respondents. Even on the best scenario for the applicant, the liability of the fourth and fifth respondents pursuant to section 550 was extremely questionable at best, and simply non-existent at worst. But when one then looks also at the correspondence that speaks of the futility of the section 323 claim, to have continued that, especially with the fourth and fifth respondents, it would seem to me that such action was unreasonable.
However, the most unreasonable act is the second one which is the failure to accept an offer of compromise in December 2022 which was repeated in June 2023. What became very clear, in this case, was that, if anything, the applicant here was financially paid more money by working than he would have if he had accepted a redundancy if it had been offered in May 2022.
If it were that, as he claimed, he was $18,000 better off, it would have left the Court looking, at the most, at compensation of around $35,000. As it would be seen that pecuniary penalties here in this case would be marginal, at best, and certainly nowhere near the amount of money that would have been awarded in compensation, an offer by the respondents to compromise the matter for a payment of a total of $90,000 should have been accepted. It would seem to me be quite unreasonable to persist with the whole claim, given the state of the evidence.
Having found that those unreasonable acts occurred, and that the respondents did incur costs because of that, the discretion to award costs has been enlivened. The applicant has made no submissions other than to say to the Court that he would agree that he should pay costs if ordered in the sum suggested by the respondents, that of $5000.
In all the circumstances, I am of the view that that is an appropriate disposition as to the question of costs.
I certify that the preceding one hundred and one (101) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Vasta. Associate:
Dated: 29 August 2023
SCHEDULE OF PARTIES
PEG 187 of 2021 Respondents
Fourth Respondent:
ARASHAD OMARI
Fifth Respondent:
STEVEN CHAPMAN
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