Smrdelj v CSL Limited
[2017] FCCA 2789
•17 November 2017
FEDERAL CIRCUIT COURT OF AUSTRALIA
| SMRDELJ v CSL LIMITED | [2017] FCCA 2789 |
| Catchwords: CONSUMER LAW – Misleading or deceptive conduct – whether Respondent made representations to Applicant that she would be employed ‘until retirement’ – application dismissed. |
| Legislation: Fair Work Act 2009 (Cth), ss.340, 341, 342, 361 Competition and Consumer Act 2010 (Cth) sch.2, ss.18, 31 |
| Cases cited: Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500 Butcher v Lachlan Edler Realty Pty Ltd (2004) 218 CLR 592 Citrus Queensland Pty Ltd v Sunstate Orchards Pty Ltd (No 7) [2008] FCA 1364 | ||
| Applicant: | ECE SMRDELJ | |
| Respondent: | CSL LIMITED |
| File Number: | MLG 1609 of 2016 |
| Judgment of: | Judge Hartnett |
| Hearing dates: | 31 October, 1 and 3 November 2017 |
| Delivered at: | Melbourne |
| Delivered on: | 17 November 2017 |
REPRESENTATION
| Counsel for the Applicant: | Mr Irving |
| Solicitors for the Applicant: | McDonald Murholme |
| Counsel for the Respondent: | Mr Felman |
| Solicitors for the Respondent: | Kelly Hazel Quill Lawyers |
THE COURT ORDERS THAT:
The application is dismissed.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLG 1609 of 2016
| ECE SMRDELJ |
Ms Smrdelj
And
| CSL LIMITED |
Respondent
REASONS FOR JUDGMENT
In Statement of Claim filed 27 July 2016 the Applicant (Ms Smrdelj) claims relevantly that:-
a)the Respondent (CSL) engaged in misleading and/or deceptive conduct in contravention of ss.18 and 31 of sch.2 of the Competition and Consumer Act 2010 (Australian Consumer Law). Specifically, that CSL represented to Ms Smrdelj that if she commenced employment with CSL:-
i)the position of Director – Aseptic Filling Operations would be a position that would exist within CSL’s business until Ms Smrdelj’s retirement; and/or
ii)it would employ Ms Smrdelj in the position of Director – Aseptic Filling Operations or a suitable alternative position, until Ms Smrdelj’s retirement; and
that because Ms Smrdelj’s position was subsequently made redundant, the conduct of CSL in making these representations was misleading and deceptive;
b)CSL took adverse action against Ms Smrdelj, as defined in paragraphs (b) to (d) of column 2 of item 1 of the Table in s.342(1) of the Fair Work Act 2009 (Cth) (the FW Act) by making Ms Smrdelj redundant; by not appointing her to the position of Senior Director – Fill and Finish; by effecting a failure or refusal to redeploy Ms Smrdelj; and by subsequently terminating Ms Smrdelj’s employment.
Ms Smrdelj claims that in breach of s.340(1)(a)(ii) of the FW Act, CSL took this adverse action, as described above, against Ms Smrdelj for the reason or for reasons including that Ms Smrdelj made a first, second and/or third employment complaint as described in paragraphs 18, 19 and 20 of the Statement of Claim, those paragraphs being:-
“18. In or around late February 2016 the Applicant had a conversation with Wayne Adcock (Dr Adcock) –Senior Director, Manufacturing Science and Technology, during which she complained to Dr Adcock about the way she had been treated by Robyn Elliott (Dr Elliott) – Senior Director, Strategic Expansion Projects and Rene Bruegger (Mr Bruegger) – Senior Director of Quality, during a meeting earlier that day in which she had been belittled, humiliated and bullied (First Employment Complaint).
19. On 3 March 2016 the Applicant attended a meeting with Ms Mynott during which she complained to Ms Mynott about the way she had been treated by Dr Elliott and Mr Bruegger during the meeting in late February 2016, and more generally, and the fact that she felt belittled, humiliated and bullied (Second Employment Complaint).
20. On 4 March 2016 the Applicant had a conversation with Adam Williams (Mr Williams) – Senior Director, Human Resources at an offsite Extended Leadership Forum during which;
(a) the Applicant complained that she was being poorly treated by Ms Elliot (sic) and Mr Bruegger and this was impeding her ability to perform her role effectively (Third Employment Complaint); and
(b) Mr Williams stated that he would meet with the Applicant the following Monday in order to discuss her complaint further.”
Paragraph 31 of the Statement of Claim alleges that, during her employment, Ms Smrdelj exercised workplace rights as defined in s.341(1) of the FW Act, being:-
a)the right to make a complaint or inquiry in relation to her employment under s.341(1)(c)(ii) of the FW Act; and
b)the right to a safe working environment without risks to health under s.21 of the Occupational Health and Safety Act 2004 (Vic);
by making the first employment complaint, second employment complaint and/or third employment complaint.
The Statement of Claim pleads (in paragraph 33) the reverse onus as set out in s.361 of the FW Act wherein it is presumed that CSL took the adverse action against Ms Smrdelj for the unlawful reasons alleged, in breach of s.340(1)(a)(ii) of the FW Act.
Paragraph 38 of the Statement of Claim alleges that CSL has contravened:-
a)section 18 of the Australian Consumer Law by engaging in the conduct alleged in paragraphs 4 to 11 of the Statement of Claim; and/or
b)section 31 of the Australian Consumer Law by engaging in the conduct alleged in paragraphs 4 to 11 of the Statement of Claim.
Paragraphs 4 to 11 of the Statement of Claim are relevantly as follows:-
“4. In or around early January 2015 the Applicant received a telephone call from James Thomas (Mr Thomas), who identified himself as a “Head Hunter” for the Respondent. During the telephone call:
(a) Mr Thomas asked the Applicant whether she would be open to discussing “new opportunities” with the Respondent;
(b) Mr Thomas told the Applicant that the Respondent, particularly at the Broadmeadows site, had undergone significant changes and was seeking the “right talent” with significant experience, technical knowledge and ability;
(c) Mr Thomas informed the Applicant that the Respondent had a role for her within the Quality or Manufacturing Area of its business;
(d) the Applicant explained that she was happy in her current role as a Quality Assurance Manager at Sypharma, that she had no intention of leaving, that the company was expanding its business overseas, that she was working on a number of significant projects, that she enjoyed a good working relationship with her boss and that there were discussions about her potentially moving into an executive position as General Manager; and
(e) Mr Thomas responded, “there are similar things happening at CSL ... surely there is a way we can entice you,” or words to that effect.
5. On 20 January 2015 the Applicant received an email from Mr Thomas stating, inter alia, that he wanted to have further discussions with the Applicant regarding potential employment with the Respondent.
…
6. On or about 20 January 2015 the Applicant received a telephone call from Justin Daly (Mr Daly) – Vice President, Operations of the Respondent. During the telephone call;
(a) Mr Daly asked the Applicant whether she would be interested in visiting the Respondent’s site in Broadmeadows and further discuss the possibility of joining his Operations Team; and
(b) the Applicant repeated what she had told Mr Thomas during their telephone call earlier that month but nevertheless agreed to meet with Mr Daly.
7. Between January 2015 and March 2015 Mr Daly and Mr Thomas regularly contacted the Applicant by telephone. During these telephone discussions:-
a) Mr Daly spoke about the “exciting challenges” that lay ahead such as a new product that was about to be introduced, site expansion plans, the construction of a new facility and much needed operational improvements;
b) Mr Daly and Mr Thomas asked the Applicant what they could do to convince her to commence employment with the Respondent;
c) Mr Daly and Mr Thomas explained that the Respondent was a “better company” for the Applicant and her future and that there were many exciting things happening at the Respondent;
d) Mr Daly explained that he was planning to move into the role of General Manager, and if this were to occur the Applicant could potentially move into his role as Vice President;
e) Mr Daly told the Applicant that she could receive a bonus of up to 20% of her salary, that the Respondent’s Broadmeadows site was closer to her home and that the Respondent was a global company with multinational sites and a strong reputation whereas Sypharma was a medium-sized company with less reputation; and
f) Mr Daly and Mr Thomas represented to the Applicant that if she commenced employment with the Respondent, it would “take her through to retirement” (the longevity representation).
8.Between January 2015 and March 2015 the Applicant received the following emails from Mr Daly:
a) on 28 January 2015 the Applicant received an email from Mr Daly inviting her to further discuss potential employment with the Respondent;
b) on 10 February 2015 the Applicant received an email from Mr Daly enclosing a draft position description for the position of Director – Aseptic Filling Operations;
c) on 11 February 2015 the Applicant received an email from Mr Daly in which he confirmed the invitation for her to visit the Respondent’s Broadmeadows site;
d) on 13 February 2015 the Applicant received an email from Mr Daly enclosing draft key performance indicators;
e) on 19 February 2015 the Applicant received an email from Mr Daly containing a draft Organisational Chart and Accountability Matrix;
f) on 26 February 2015 the Applicant received an email from Mr Daly regarding her potential role within the Respondent;
g) on 27 February 2015 the Applicant received an email from Mr Daly outlining the Respondent’s structure and the development of the Applicant’s potential role;
h) in or around early March 2015 the Applicant received an email from Mr Daly requesting a copy of her resume which the Applicant subsequently provided; and
i) on 5 March 2015 the Applicant received an email from Mr Daly in which he requested that she highlight and elaborate on certain skills contained in her resume.
...
9.On 13 April 2015 the Applicant received an email from Mr Daly enclosing an offer to commence employment with the Respondent in the position of Director – Aseptic Filling Operations in the Manufacturing and Operations group.
...
10.On 22 April 2015 the Applicant attended a meeting with Bernadine Mynott (Ms Mynott) – Senior Human Resources Business Partner, to further discuss potential employment with the Respondent.
11.On 23 April 2015 the Applicant received an email from Mr Daly enclosing a revised offer to commence employment with the Respondent in the position of Director – Aseptic Filling Operations, the Manufacturing and Operations group.
…”
In a Response filed 10 August 2016, CSL seeks that the application be dismissed and sets out grounds of opposition. CSL denies that it has contravened s.340 of the FW Act and denies that it has contravened ss.18 and/or 31 of the Australian Consumer Law. CSL denies that any discussion between Ms Smrdelj and Ms Mynott constituted a “complaint” as that term is used in s.341(1)(c) of the FW Act or that any alleged complaints of Ms Smrdelj contained in Ms Smrdelj’s Statement of Claim constitute a “complaint” as that term is used in s.341(1)(c) of the FW Act.
CSL further asserts that, regardless, Ms Smrdelj’s alleged complaints played no part in the decision to make Ms Smrdelj’s position redundant and subsequently retrench her employment. Further, that the only reason for the decision by Mr Schären – Senior Vice President and General Manager, to make Ms Smrdelj’s position redundant and subsequently retrench her employment is that CSL was not able to deploy her into another role during the redeployment period, because her position was no longer required due to the restructure undertaken by CSL such that the functions of the Vice President of Manufacturing Operations were restructured into two new roles at Senior Director level.
Evidence
In accordance with orders made in the course of directions hearings the parties filed affidavits of evidence on which they relied at trial.
Ms Smrdelj filed two affidavits, one affirmed by her on 14 November 2016 and a further affidavit in reply affirmed by her on 3 February 2017. Ms Smrdelj did not rely upon an affidavit of Mr Justin Daly affirmed 2 December 2016 and filed by her in the proceedings. Ms Smrdelj was cross-examined as to her evidence.
CSL relied upon the following affidavits of evidence:-
a)an affidavit of Ms Bernadine Jodie Mynott, Senior Human Resources Business Partner at CSL, affirmed 16 December 2016;
b)an affidavit of Dr Wayne Lee Adcock, Senior Director – Manufacturing Science and Technology at CSL (at the relevant time) affirmed 16 December 2016;
c)an affidavit of Mr James Leighton Thomas, Recruitment Business Partner at CSL from December 2015 to May 2016 and Senior Talent Acquisition Consultant at CSL from May 2016, affirmed 15 December 2016;
d)an affidavit of Mr Martin Peter Schären, Senior Vice President and General Manager at CSL affirmed 22 December 2016;
e)an affidavit of Mr Adam Matthew Williams, Director – Human Resources at CSL affirmed 22 December 2016; and
f)an affidavit of Dr Robyn Louise Elliott, Senior Director – Strategic Expansion Projects, sworn 22 December 2016 (Dr Elliot acted as the interim Vice President – Manufacturing Operations whilst remaining in the role of Senior Director – Strategic Expansion Projects from January 2016 to June 2016).
Additionally, CSL subpoenaed Mr Justin Daly, formerly Vice President – Manufacturing Operations at CSL, to give evidence in the proceedings upon being advised by Ms Smrdelj’s Counsel on day one of the hearing that Mr Daly’s affidavit evidence was no longer being relied upon by Ms Smrdelj.
Each of the witnesses of CSL were cross-examined save for Dr Adcock whose evidence was unchallenged.
During the course of the proceedings Ms Smrdelj withdrew her allegation, and thus did not press, that those conversations described in her Statement of Claim as being a first complaint and a third complaint were in fact, workplace ‘complaints’. This was an appropriate concession on the facts as presented. Ms Smrdelj proceeded on the basis that she made only one workplace complaint and that such complaint was made to Ms Mynott. Further, it was agreed that the date on which the alleged complaint was made was 1 March 2015.
Ms Smrdelj also made a claim for an unpaid bonus in breach of contract. That bonus has been paid to her and so that claim also was not pressed.
Statements of fact in these reasons are findings of fact on the balance of probabilities.
Ms Smrdelj’s employment
Prior to her commencement of employment with CSL in 2015, Ms Smrdelj had over 20 years of experience both as a senior manager and/or senior consultant and a further in excess of five years of employment in other roles in the pharmaceutical, biotechnology, medical device and veterinary medicines industries. She holds a bachelor of science, majoring in microbiology and biochemistry; a graduate diploma in business management; and a certificate in quality (quality management and lead assessor). Prior to 1994, Ms Smrdelj had four different employers for periods lasting between one year and five years. In 1994, Ms Smrdelj was employed by CSL Ltd Pharmaceutical Division Australia as a Quality Compliance Officer until 1998. In 1999, she commenced a period of employment of four years with Glaxo Wellcome/GSK – Active Supply as a Senior Operational Quality Manager. In 2003 until May 2014, Ms Smrdelj was employed by SeerPharma Pty Ltd as a Senior Consultant. She was thereafter employed between 1 July 2014 and May 2015 at Sypharma Pty Ltd (Sypharma) as Manager – Quality Assurance and Quality Control. In that position Ms Smrdelj’s income was $136,000 per annum plus superannuation of 9.25 per cent being the pro rate figure for working four days a week. Although Ms Smrdelj was employed for a four-day week, her evidence was that she commonly worked five days each week. She was not paid for the fifth day as her employer could not afford to pay a five day week salary. Ms Smrdelj noted, in her confidential résumé annexed to her affidavit affirmed 14 November 2016, that with Sypharma she was “currently in the process of transitioning into the General Manager position.”[1] Ms Smrdelj’s evidence was that in December 2014 she had in fact been offered this position. By May 2015 however, that promotion had not transpired.
[1] Affidavit of Ms Smrdelj affirmed 14 November 2016, Annexure 1.
In July 2015, Ms Smrdelj commenced employment with CSL in the position of Director – Aseptic Filling Operations. What led to Ms Smrdelj taking up that employment is as set out in the following paragraphs.
Approach by CSL
Mr Thomas commenced employment with CSL as a Recruitment Business Partner in December 2014. He had considerable experience recruiting for CSL as an external recruiter prior to his employment by CSL. In May 2016 Mr Thomas was promoted to his current position of Senior Talent Acquisition Consultant at CSL.
On 19 January 2015, Ms Smrdelj received a LinkedIn message from Mr Thomas which was relevantly as follows:-
“…
We connected a few months back whilst I was an external recruitment consultant. I was wanting to speak with you and assess whether you were interested in hearing about opportunities with our site in Broadmeadows.
Could you please give me a call when you get a chance?
Hopefully speak with you soon.
…”
On 20 January 2015, Ms Smrdelj received an email from Mr Thomas in the same terms as the LinkedIn message of 19 January 2015. On that same day, being 20 January 2015, Ms Smrdelj responded to Mr Thomas’ LinkedIn message. Ms Smrdelj thanked Mr Thomas for contacting her again and indicated relevantly, that she “would be happy to hear about opportunities at CSL Broadmeadows.” She provided Mr Thomas with her mobile telephone number.
In late January 2015 Mr Thomas telephoned Ms Smrdelj on the number she had provided to him in her LinkedIn reply. He asked Ms Smrdelj whether she would be open to discussing “new opportunities” including commencing employment with CSL. Mr Thomas told Ms Smrdelj that CSL, particularly the Broadmeadows site, had undergone significant changes and that they were seeking the “right talent” with significant experience and technical and compliance knowledge and abilities. He was unclear about what role CSL was proposing for Ms Smrdelj and, indeed, no role was proffered. Mr Thomas advised Ms Smrdelj that this initial contact was at the direction of Mr Justin Daly, Vice President – Manufacturing Operations, whom Ms Smrdelj had previous dealings with.
During the above telephone conversation in January 2015, Ms Smrdelj explained to Mr Thomas that she was happy in her employment at Sypharma. She described having a good working relationship with her boss; that she was working on a number of significant projects, and that there were “discussions about me potentially moving into an executive position as general manager”. Ms Smrdelj’s evidence is that in this initial telephone conversation, she “pointed out” to Mr Thomas “that any job I moved into would need to take me through to retirement”; that Mr Thomas indicated CSL “had more than enough happening to take me beyond my retirement years”; and that Mr Thomas said, “CSL was in a much better position to offer (her) employment longevity”.
From Mr Thomas’ perspective, Ms Smrdelj appeared open to further discussion with him. He noted that she was interested in what he had to say about CSL, but not necessarily “straight away or right now”.
Mr Thomas had focused his telephone conversation with Ms Smrdelj on the interesting things that were happening at CSL, including details about capital expenditure, staff numbers growth, and CSL’s excellent reputation in the industry. He referred to it as an exciting place to work. Mr Thomas did not say to Ms Smrdelj that a job at CSL would take her “beyond her retirement years” or that “in comparison to Sypharma, CSL was in a much better position to offer her employment longevity” or anything to a similar effect. The Court finds that this was very much an introductory conversation between a very experienced recruiter for CSL and a potential candidate for employment. Mr Thomas’ evidence was that he sought at that stage of the process to provide information about CSL. It was not a conversation about Ms Smrdelj’s particular requirements. It was a conversation very general in nature. Indeed no potential role had been proposed by CSL. The Court accepts the evidence of Mr Thomas concerning these matters. His evidence was credible and consistent and for the reasons described hereafter is preferred to that of Ms Smrdelj.
Mr Thomas, at the end of the late January 2015 conversation with Ms Smrdelj, considered that CSL would need to provide her with more specifics about what a potential role at CSL might look like before talking with her further. He communicated this to Mr Daly who confirmed that the role would fall within the operations group, but did not at that point identify a specific position. Mr Daly told Mr Thomas to contact Ms Smrdelj again with that further information and to attempt to arrange a ‘catch-up’ between Mr Daly and Ms Smrdelj at the CSL Broadmeadows site.
On 28 January 2015, Mr Thomas made a further telephone call to Ms Smrdelj. He indicated to her that any potential role would fall within the operations group. He also arranged a ‘catch-up’ between Mr Daly and Ms Smrdelj to discuss the opportunity further. On 28 January 2015 Mr Thomas emailed a request to Ms Smrdelj for a meeting between Mr Daly and Ms Smrdelj at the Broadmeadows site on 4 February 2015. This date was subsequently altered by Mr Daly to 13 February 2015. Mr Thomas spoke only twice more with Ms Smrdelj by telephone:- on the first occasion to see how the catch-up and site visit went, Ms Smrdelj being impressed with the Broadmeadows site; and on the second, approximately two weeks later, as a result of Mr Daly directing him to call Ms Smrdelj again to organise an in-depth discussion with Mr Daly about a specific opportunity at CSL. After that point Mr Thomas’ role in the process of recruiting Ms Smrdelj diminished. He did, however, on 17 April 2015 respond to Ms Smrdelj’s email of 15 April 2015 concerning her proposed employment contract wherein she sought clarity on “a couple of things in the offer”. I shall return to this in paragraph 41 hereafter.
On 10 February 2015, Ms Smrdelj received an email from Mr Daly in which he enclosed a draft position description for the position of ‘Director - Aseptic Filling Operations’.
On 11 February 2015, Mr Daly sent a further email to Ms Smrdelj, inviting her to a site meeting on 13 February 2015 to discuss future potential employment with CSL. Ms Smrdelj also emailed Mr Daly agreeing to review the draft position description.
On 13 February 2015, Ms Smrdelj met with Mr Daly in his office at the CSL Broadmeadows site. Mr Daly explained the discussions as a sharing of information, a ‘matching process’. He explained matters pertaining to CSL’s operations including the recent changes at the CSL Broadmeadows site and where he felt talent, such as Ms Smrdelj’s, could complement the existing team. In response, Ms Smrdelj told Mr Daly what she was then doing at her existing employer, Sypharma, and what the company had planned for her. Mr Daly then took Ms Smrdelj on a tour of the facilities of the CSL site in Broadmeadows. Ms Smrdelj’s evidence is that during the conversation had that day, she and Mr Daly “discussed the fact that any move I made would need to last and take me through to retirement.” Whilst Mr Daly could not recall this he accepted that Ms Smrdelj, that day, may have put forward her aspirations. This was not an unusual process, each party putting forward a bargaining position. In terms of importance to her however, there was no ‘hierarchy’ presented by Ms Smrdelj as to those things that were important to her. Certainly, longevity was not a “necessary condition as expressed”. Ms Smrdelj’s evidence is that Mr Daly’s response to that part of the discussion was that “there was so much happening at CSL that this would not be an issue”. Whilst Mr Daly did not disagree with that in evidence, his further evidence was that he never said to Ms Smrdelj that her job at CSL or the role offered to her would “take [Ms Smrdelj] through to retirement”. Rather as set out in paragraph eight of his affidavit evidence, what he said and the basis for his comments was in context, and importantly so, as follows:-
“Rather, what I said to Ms Smrdelj were words to the effect of ‘as you know CSL is very stable and people stay through to retirement’. I made these comments because based on my experience in the role as Vice-President at the time, CSL was a stable organisation, and I had observed that many people at CSL has been employed there for a very long time, and some people did stay through at CSL until retirement. I considered CSL to be commercially stable because it was well capitalised, had no significant competition in the pharmaceutical industry, and that the pharmaceutical industry was a stable one. That is, demand for pharmaceutical products manufactured by CSL was constant. This was not the same environment in which Sypharma operated.”
The Court notes additionally that all of these discussions were occurring within the context of no yet determined role.
On 19 February 2015, Ms Smrdelj received an email from Mr Daly enclosing a draft organisational chart and accountability matrix. He “considered this to be necessary because the role of Director- Aseptic Filling Operations was not yet an existing role and these materials were intended to provide clarity to Ms Smrdelj”.
On 26 February 2015, Ms Smrdelj received an email from Mr Daly regarding the position of ‘Director - Aseptic Filling Operations’. In this email, Mr Daly relevantly stated he was working with human resources on the position review and asked whether Ms Smrdelj would be available to speak with him on the following day. Ms Smrdelj confirmed she was so available. The proposed conversation did not occur at that time, Mr Daly being busy.
On 27 February 2015, Mr Daly sent an email to Ms Smrdelj outlining the structure of CSL and the development of the Director- Aseptic Filling Operations position.
On 28 February 2015, Ms Smrdelj received an email from Mr Daly in which he requested a copy of her CV. On 2 March 2015, Ms Smrdelj responded saying that her CV was not current and required updating. Mr Daly advised her by response to focus on leadership and management when updating her CV. Ms Smrdelj did so. She also, as requested by Mr Daly, elaborated on certain skills contained in her résumé.
On 10 March 2015, Ms Smrdelj forwarded Mr Daly an updated version of her CV and advised that she would be overseas for four weeks and any discussions he wished to have would have to happen before or after.
On 18 March 2015, Ms Smrdelj sent an email to Mr Daly to ask whether he would like to talk upon her return, as Mr Daly had not, prior to that time, found the time to have a further discussion with her. Ms Smrdelj was clearly interested in, and pursuing employment with, CSL. Ms Smrdelj’s email was relevantly as follows:-
“Hi Justin.
I hope all is well. I am assuming you have been very busy. Would you like to talk when I return on 13 April, or would you like me to cease pursuing this?
You have my number and, if you wish, you may call me.”
On 19 March 2015, Mr Daly emailed Ms Smrdelj responding to her that he was “very much still pursuing this”. He indicated to Ms Smrdelj that he intended to send her an offer.
On 27 March 2015, Mr Daly emailed Ms Smrdelj in which he proposed an offer of employment.
On 13 April 2015, Mr Daly forwarded by email a proposed employment contract for the position of Director – Aseptic Filling Operations in Manufacturing Operations at CSL. Mr Thomas was copied into this email. It was he who prepared the contract as directed by Mr Adam Williams, Director – Human Resources at CSL.
Two days after receiving the proposed employment contract and on 15 April 2015, Ms Smrdelj sent an email to Mr Daly in which she requested clarification of her proposed role at CSL. The relevant parts of that email are as follows:-
“
…
(a) It appears as an interim measure the position will be reporting to the VP Manufacturing - what is the future plan? when will this occur? and who will the role be reporting into? what is the future for this role? and development under these circumstances?
...
(c) There were additional incentives mentioned during discussions and your email dated 30.3.2015 such as the salary continuance - these are not mentioned here.
(d) Is the offer $195,000 + super + TEC + incentives?
…”
Mr Thomas responded to Ms Smrdelj’s email above by email of 17 April 2015 (Mr Daly was copied in) wherein he addressed the specific queries of Ms Smrdelj and said, relevantly, as follows:
“(a) All of our contracts are worded to outline the reporting lines and allow a level of changed (sic) in structure over time without the constraint need to update. Any evolution of the position will be driven by performance and ongoing business requirements. There is no active plans or approaches that would see your reporting lines change from the VP Manufacturing. Justin has indicated that over time we would look at rolling in Packaging and Inspection function once major project and compliance improvements were made.
...
(c) Salary continuance is a benefit afforded to all employees under our current Agreement. This can be found under Part 9 of our Enterprise Agreement in the attached file. As Justin has mentioned, the share plan/options are not included in an employment contract as they are discretionary.
(d) TEC stands for Total Employment Cost. This is Base + Super. It is stated as such as the Short-Term Incentive (STI- Annual Bonus) is a percentage of this figure. To be explicit, the offer is $178,082.2 plus 9.5% Super plus potential annual bonus of 29,250. It is industry standard to associate bonus payments to a performance clause and not be guaranteed. Bonuses have been paid in full to the majority of employees as the business (and leadership group) have been deemed to be performing over the recent past period.
…”
In cross-examination Ms Smrdelj was asked whether, after reading the above, she would have known that if there was a change in the ongoing business requirements then there may have been an evolution or a change in the position going forward. She responded ‘perhaps’. This was a critical concession on her part.
Ms Smrdelj was concerned about the salary offered. In her view, it was not commensurate with the role and its responsibilities. Thus Mr Daly proceeded to arrange for Ms Smrdelj to meet with human resources at the CSL site for salary discussions to occur. Remuneration was the only remaining issue of concern to Ms Smrdelj.
On 22 April 2015, Ms Smrdelj met with Mr Daly and Ms Mynott, Senior Human Resources Business Partner. Mr Daly then left the room, and Ms Mynott had a discussion with Ms Smrdelj as to her background and experience and other related matters. On 23 April 2015 Ms Smrdelj received an email from Mr Daly enclosing a revised employment contract which contained a salary of $188,000 per annum plus superannuation. This was an offer acceptable to Ms Smrdelj, and on 4 May 2015, she sent an email to Mr Daly accepting the offer of employment and enclosing a signed copy of the revised employment contract. On 18 May 2015, Ms Smrdelj resigned from Sypharma.
Contract of employment
The contract of employment entered into between Ms Smrdelj and CSL contained a number of clauses. Ms Smrdelj’s evidence is that she read and understood those clauses. She claimed to have seen such clauses in previous contracts. She gave evidence, unsupported, that her contract with Sypharma contained a redundancy clause. It did not. The contract of employment was very much part of the relevant surrounding facts and circumstances of Ms Smrdelj’s engagement with CSL and Ms Smrdelj, I am satisfied, knew it to be so. As was said by the majority in Butcher v Lachlan Edler Realty Pty Ltd (2004) 218 CLR 592:
“… it is important that the… conduct be viewed as a whole. It is not right to characterise the problem as one of analysing the effect of its ‘conduct’ divorced from… circumstances which might qualify its character. Everything relevant… must be taken into account.”
Critically, the circumstances highly relevant to Ms Smrdelj taking on employment with CSL were the terms of her contract of employment. Those of particular relevance were:-
a)clause 3 of the contract of employment:-
“3. Probationary/Qualifying Period
You will be subject to a probationary/qualifying period for the first 6 months of your employment. During this period both you and the company will assess the suitability of continuing your employment. Subject to clause 17.23, at any time during this period either you or the Company may terminate your employment by providing 1 week’s written notice to the other party or payment in lieu (based on your total employment cost) of all or part of this period.”
b)clause 17.1 of the contract of employment:-
“17.1 Termination with notice
Unless clause 17.2 (Termination with notice in redundancy situations) or 17.3 (Summary termination) applies, you or the Company may terminate your employment at any time by giving 4 weeks written notice to the other. This notice period for termination of your employment will continue for any future positions with the Company unless specifically replaced in writing. If the Company terminates your employment the period of notice is increased by one week if you are over 45 years old and have completed at least 5 years' continuous service with the Company.
The Company may elect to make a payment to you in lieu of all or part of the notice period. This payment will be based on the components of your remuneration that you would have received for the time you would have worked during the period of unserved notice. A payment in lieu of notice will not include any discretionary bonus payment. The Company may direct you to not perform work and/or not attend work during all or part of the notice period.”
c)clause 17.2 of the contract of employment:-
“Termination with notice in redundancy situations
In circumstances where the company has made a decision that your position is excess to company requirements it may terminate your employment by giving you three months written notice.
The company may terminate your employment at any time within the applicable notice period providing that it pays you in lieu of the unexpired portion of the notice period.”
d)clause 17.3 of the contract of employment:-
The Company may terminate your employment at any time and without notice if you:-
“(a) commit any act of misconduct or are negligent or incompetent in the performance of your duties;
(b) commit any act which may detrimentally affect the Company including, but not limited to, an act of dishonesty, fraud, wilful disobedience or breach of duty; or
(c) commit a serious breach of any of the terms of this letter or any Company policy; or
(d) are charged with any criminal offence which, in the reasonable opinion of the Company may embarrass or bring you or the Company into disrepute; or
(e) breach an obligation set out in the CSL Employee Confidentiality Deed.”
e)clause 20 of the contract of employment:-
“General
This agreement supersedes all prior agreements, understandings, representations and negotiations, whether written or verbal, in respect of your employment with the Company and all previous agreements you may have had with the Company. You acknowledge that in accepting employment with the Company you have not relied on any representations regarding your employment made by the Company (or its agents or employees) other than matters expressly set out in this letter.
This letter of offer is governed by and construed in accordance with the laws of Victoria. The parties submit to the exclusive jurisdiction of the courts in Victoria. A term or part of a term of this letter that is illegal or unenforceable may be severed from this letter, and the remaining terms or parts of the terms of this agreement continue in force.
We are pleased to welcome you to the Company on the above terms and conditions. Please sign and initial each page of the attached copy of this letter and return it to Human Resources within 7 days, together with the signed Confidentiality Deed, a certified copy of your qualifications and the complete payroll documentation enclosed.
…”
As conceded by Ms Smrdelj in cross-examination, Ms Smrdelj never sought to remove any clause in her contract of employment which dealt with redundancy and/or termination of employment. Nor did she seek to add a clause fixing the term of her employment.
Conclusion
Section 18 of the Australian Consumer Law provides that a person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.
Section 31 of the Australian Consumer Law relevantly provides that a person must not, in relation to employment that is to be, or may be, offered by the person, engage in conduct that is liable to mislead persons seeking the employment as to the availability, nature, terms or conditions of the employment, or any other matter relating to the employment.
Ms Smrdelj had lengthy experience as a senior manager. Ms Smrdelj conceded in cross-examination that she knew that things in an organisation could change; that there was always a prospect that there would be restructures in an organisation; that there may be redundancies; and that there was always a prospect that there would not be a role into which she could be redeployed. Ms Smrdelj knew of the varied possibilities that could eventuate so as to not see her work through to retirement at CSL. In light of all the circumstances and viewed as a whole, the conduct of CSL could not have conveyed any meaning, message or representation that Ms Smrdelj’s job at CSL ‘would take her through to retirement’ nor was it misleading or deceptive, or capable of being so.
No one, at any stage on behalf of CSL, said to Ms Smrdelj that any job at CSL “would take her through to retirement”. Further, Ms Smrdelj conceded in cross-examination that she had never discussed with anyone at CSL about what “retirement” in Ms Smrdelj’s mind meant.
Ms Smrdelj’s own evidence about the representations that were made to her was inconsistent and at times vague. As submitted by Counsel for CSL, this inconsistency and lack of specificity is fatal to Ms Smrdelj establishing, with the degree of precision required, that the alleged representations were made, to enable the Court to be reasonably satisfied that they were in fact misleading in the circumstances. [2]
[2] Citrus Queensland Pty Ltd v Sunstate Orchards Pty Ltd (No 7) [2008] FCA 1364 , 97 per Collier J.
At the time that Mr Thomas assisted Mr Daly in the recruitment of Ms Smrdelj to join CSL, he had no reason to think that Ms Smrdelj’s position would become redundant, he had no knowledge of any impending structural changes. He had not spoken with Mr Schären about any structural changes, and nor was it part of his role at CSL to do so. He was not challenged about any aspects of this evidence.
In January 2016, Mr Daly agreed to resign from CSL following a discussion with Mr Martin Schären, the then General Manager of the CSL Broadmeadows site. Mr Daly had no plans to resign at the time he recruited Ms Smrdelj to CSL nor when he had any conversations with her. He was not aware that Mr Schären would become the General Manager of the CSL Broadmeadows site (replacing Dr Simon Green), nor that Mr Schären had plans to split his role into two Senior Director positions. Further, he had no knowledge that there would be any restructuring of the organisation (including his own position at CSL) and he had no knowledge that there would be any restructuring that might affect Ms Smrdelj’s role. He was not challenged about any aspects of this evidence.
Further, as submitted by Counsel for the Respondent and as based on the evidence, Mr Daly had reasonable grounds to make the representation (at the time that he made it) that CSL was commercially stable and many people at CSL work through to retirement. Mr Daly made these comments on the basis as described in paragraph 30 herein.
Ms Smrdelj did not rely on any alleged representations about the longevity of her employment with CSL. In evidence Ms Smrdelj’s reasons for joining CSL were inconsistent. She refused, in a totally implausible way, to make basic, and supported by the evidence, concessions, for example, that employment within CSL in the role which eventually became apparent was in fact a promotion. The Court finds Ms Smrdelj sought out the opportunity to be employed by CSL once approached and left her job at Sypharma because CSL’s job offered more remuneration; it was an effective promotion; it was a larger organisation with a better reputation; there was the prospect that she might progress into the Vice-President’s role; and it involved a shorter travel distance for her. Job security into the future was not an issue or a driver, relied upon by Ms Smrdelj. On her own evidence, Ms Smrdelj had that with Sypharma.
Fair Work Claim
Background
CSL is a global biopharmaceutical company. CSL’s plasma products are produced at facilities in Bern, Switzerland; Marburg, Germany; Kankakee, Illinois; and Broadmeadows, Australia. CSL is one of the leading manufacturers in the plasma protein therapeutics industry.
In July 2015, CSL’s Broadmeadows site was transitioning from being solely a manufacturer of toll plasma products to manufacturing and exporting commercial product, namely Privigen. The Broadmeadows site was undergoing significant capital expansion with its biotechnology facility, Turner Facility (which produces Privigen), and AlbuRX (still under construction) manufacturing facilities, whilst continuing to manufacture its toll products.
CSL’s toll and Privigen manufacturing processes consist of three main parts: bulk manufacturing, aseptic filling, and packaging. The bulk manufacturing starts with receipt of plasma. During bulk manufacturing the plasma is subsequently fractionated into separate protein components, and the proteins are further purified to ensure product safety and efficiency. This process is a continuous manufacturing process and can take up to 18 days to produce one batch of product. Once the bulk protein product is isolated, it is aseptically filled via an aseptic filling machine into sterile glass bottles which are stoppered and capped. The bottles are subsequently labelled and packed for shipment to the customer.
When Ms Smrdelj commenced with CSL on 6 July 2015, Ms Smrdelj was responsible for overseeing the sterilisation and bottling phase for toll and Privigen manufacturing, which is referred to as “aseptic filling”. Another director, Mr Bob Skok, was responsible for overseeing the “bulk” manufacturing phase for toll and Privigen. Mr Schären had not yet arrived in Australia.
Mr Schären is the current Senior Vice-President and General Manager of CSL. He has over 25 years engagement in the global biopharmaceutical sterile manufacturing industry in Europe, the USA and Australia. He joined CSL in 1999, and has held a broad range of management and other positions in Bern, Switzerland.
Around June 2015, one month before Ms Smrdelj’s commencement of employment with CSL, having been requested by Mr Val Romberg, Executive Vice-President of Manufacturing and Planning in Bern, Mr Schären signed a contract confirming he would move from Bern, Switzerland, to Australia to take over CSL’s operations in Australia at the Broadmeadows site. The Broadmeadows site was struggling in a number of areas. There was a failing to meet key performance indicators; interruptions and capacity problems with the toll manufacturing business; average compliance with Good Manufacturing Practice; unacceptably high plasma wastage levels and project delivery times being behind schedule. Mr Schären was given a clear direction from Mr Romberg that his job in Australia was to turn the Broadmeadows site around.
Shortly after Mr Schären’s arrival in Australia in September 2015, he commenced a review of the business and structure at the Broadmeadows site. That involved interviews with his direct reports including the ‘Senior Australian Leadership Team’ (SALT) as well as a large number of skip level meetings held onsite across all functions of the business with many teams of employees of a range of levels. Mr Schären was also reviewing the organisational architecture, including the organisational structure, strategic direction, core processes and skills within the business. Following his review, Mr Schären identified a number of deficiencies at the Broadmeadows site which included that there was a lack of collaboration resulting in a ‘silo’ mentality because of the way projects were organised; a lack of effective strategic direction and alignment; and systematic failures in core processes and practices. He formed the view that the business required significant improvement in a number of areas.
From October 2015 to January 2016 and for his own personal use, Mr Schären developed a confidential document outlining his initial plans for the Broadmeadows site and the initial findings of his review. He also wrote in this document his initial recommendations to turn the CSL Broadmeadows site business around.
Mr Schären determined that a number of structural changes were required at CSL. With respect to the manufacturing operations, he considered the then structure inappropriate for the business. Mr Schären determined to split the Vice President – Manufacturing Operations role into two separate senior director roles, being (a) Senior Director – Bulk Manufacturing and (b) Senior Director – Fill/Finish including all environmental health and safety and supply chain functions. His reason for planning to split the Vice President – Manufacturing Operations role included that it was simply too large a role for one position, given that the business was in an unstable stage and experiencing huge growth. In addition, this type of functional split was a known model in the industry as the bulk and fill/finish processes utilised very different manufacturing technologies. Mr Schären’s equivalent general manager of the Kankakee manufacturing facility in the United States had already adopted this structure at his site.
Mr Schären also determined that Mr Daly was not the right person to lead the Manufacturing Operations into the future.
In January 2016 Mr Daly resigned. Mr Schären met with all of Mr Daly’s reports, including Ms Smrdelj, to inform them of Mr Daly’s resignation. He then made an announcement to all CSL employees in Australia regarding Mr Daly’s resignation from the business.
In late 20 January 2016, Mr Schären again met with Mr Daly’s former reports, including Ms Smrdelj, and explained that Dr Robyn Elliott, Senior Director – Strategic Expansion Projects would be appointed as caretaker Vice President – Manufacturing Operations on an interim basis. Following that meeting he then announced to all CSL employees in Australia that he had so appointed Dr Elliott. The appointment of Dr Elliott in a caretaker role was because Mr Schären’s proposed split of the Vice-President – Manufacturing Operations role into two separate senior directors roles was still being finalised and required the endorsement of Mr Romberg, albeit it was a decision made solely by Mr Schären.
Dr Elliott is a member of the SALT. Dr Elliott commenced her employment with CSL in March 2013 in the position of Senior Director – Quality. Around June 2015 she commenced her position as Senior Director – Strategic Expansion Projects. From January 2016 to June 2016 she acted as the interim Vice President – Manufacturing Operations whilst remaining in her role as Senior Director – Strategic Expansion Projects.
A complaint?
In or about February 2016 Dr Elliott became aware of a commitment that had been made by CSL to the Therapeutic Goods Association (TGA), a government regulatory body, during a response to the toll TGA August 2015 audit, which had not been implemented by the committed date of December 2015. Ms Smrdelj had become aware, in December 2015, of the same commitment made by CSL to the TGA. Ms Smrdelj had, upon becoming aware of the commitment, contacted Mr Matthew Donnegan, Microbiology Manager at CSL, in an attempt to delay the commitment date. Mr Donnegan had made it clear to Ms Smrdelj that the commitment completion date was non-negotiable. Ms Smrdelj had informed Mr Daly that, in her view, it was an unrealistic commitment date. She requested he raise the matter with more senior members of the quality team such as Mr Bruegger, Senior Director – Quality.
In late February 2016 a meeting was held and attended by Dr Elliott, Ms Smrdelj, Mr Bruegger, Mr Disco (who was then Manager of Filling, Toll Plasma), Mr Comerford (head of Quality Assurance), and Mr Donnegan to discuss the commitment time line. In Dr Elliott’s capacity as the interim Vice President – Manufacturing Operations, it was her responsibility to oversee the implementation of tighter environmental monitoring limits (as required by the commitment) in the aseptic manufacturing area.
Ms Smrdelj’s evidence was that Dr Elliott entered the meeting room with a raised voice and was verbally aggressive toward Ms Smrdelj for resisting the implementation of the change. Further, Ms Smrdelj claimed that Dr Elliott spoke over her and subsequently accused her of manipulating and misrepresenting data to suit her own needs, asserting that Ms Smrdelj was “just out to make things difficult”. Ms Smrdelj’s evidence was, further, that at one point she noticed Mr Bruegger was quietly laughing.
Dr Elliott, in her evidence, denied that she raised her voice to Ms Smrdelj and denied that she interrupted Ms Smrdelj, or in any way berated her. She denied that she entered the room with a raised voice and further denied that she directed any verbal aggression toward Ms Smrdelj or anyone else who attended the meeting. Dr Elliott’s further evidence was that on numerous occasions in the meeting, Ms Smrdelj spoke over Mr Donnegan with a raised voice, and the meeting became quite heated. Dr Elliott’s considered Ms Smrdelj’s behaviour toward Mr Donnegan to be totally inappropriate, particularly given CSL’s guiding values, which had recently been reiterated by Mr Schären, with respect to working with “collaborative spirit” between departments and towards each other. In her opinion, Ms Smrdelj was not working collaboratively in the meeting.
Dr Elliott denied accusing Ms Smrdelj of manipulating and misrepresenting data to suit her own needs and denied that she said to Ms Smrdelj that she was just out to make things difficult. Dr Elliott did not see Mr Bruegger laughing at any point during the meeting.
Following the meeting described above, Ms Smrdelj claims she felt belittled and humiliated, and as someone in human resources was not available, she sought out Dr Adcock to complain to him about what had happened in the meeting. This conversation with Dr Adcock was said by Ms Smrdelj in her Statement of Claim to be her first employment complaint. During the running of the matter, Counsel for Ms Smrdelj indicated that Ms Smrdelj was withdrawing from that claim.
The evidence of Dr Adcock, as contained in his affidavit of evidence, was unchallenged by Ms Smrdelj. Dr Adcock, as at 16 December, had been employed by CSL for 24 years. At the time Ms Smrdelj was employed with CSL he was Senior Director – Manufacturing, Science and Technology. In that role he reported to Mr Daly.
Dr Adcock’s evidence was that in February 2016 he had a conversation with Ms Smrdelj upon Ms Smrdelj coming into his office and being noticeably upset and crying. Dr Adcock asked Ms Smrdelj why she was crying, and Ms Smrdelj informed him about a recent meeting she had with Mr Bruegger and Dr Elliott. Whilst Ms Smrdelj did not go into much detail about what had happened at the meeting, she told Dr Adcock that she did not like the way in which she had been treated by Mr Bruegger and Dr Elliott.
Dr Adcock considered the conversation described above, to be informal and at a peer-to-peer level. He did not tell anyone about the conversation, and he had no reason to do so. He understood it to be of a private and personal nature. In May 2016, Dr Adcock’s role as Senior Director – Manufacturing, Science and Technology was made redundant as part of the restructure of the manufacturing operations area. As a result of the restructure he was redeployed.
Some days after her discussion with Dr Adcock, and on 1 March 2016, Ms Smrdelj and Ms Mynott, in her capacity as Senior Human Resources Business Partner at CSL, had a meeting. Ms Mynott gave evidence about this meeting. Ms Mynott was a reliable and honest witness. Her evidence, where it differed from that of Ms Smrdelj, is accepted by the Court and was as follows:-
a)on 24 February 2016 Ms Mynott had sent a message request to Ms Smrdelj for the purpose of discussing a serious disciplinary investigation she was managing of a team leader within Ms Smrdelj’s team. The meeting had been scheduled for 1 March 2016;
b)after discussing the team leader employee issue at the 1 March 2016 meeting, Ms Smrdelj proceeded to say that she did not feel respected by some members of the SALT. Ms Smrdelj referred to Dr Elliott and to Mr Bruegger but also spoke about the SALT generally. Ms Smrdelj became very upset. Ms Smrdelj asked Ms Mynott what recourse she had to address the matter informally. Ms Mynott asked her whether she had gone to Dr Elliott’s or Mr Bruegger’s boss, Mr Schären, and Ms Smrdelj responded that she had not;
c)Ms Mynott was “trying to understand what the problem was”. She asked Ms Smrdelj three or four times what she wished to do. Ms Smrdelj was crying, and said that she was not sure if she wanted to stay working at CSL. Ms Mynott asked Ms Smrdelj if she wanted Ms Mynott to raise it formally with anyone, and Ms Smrdelj replied in the negative. Ms Mynott asked Ms Smrdelj whether she herself wished to do something about it, and Ms Smrdelj replied in the negative. The conversation ended by Ms Mynott again suggesting to Ms Smrdelj that she should raise the matter with Mr Schären who was Dr Elliott’s and Mr Bruegger’s superior. Ms Mynott “specifically took no notes” as she considered it not a ‘complaint’;
d)immediately following the meeting with Ms Smrdelj, Ms Mynott emailed Mr Williams, Director – Human Resources, about her meeting with Ms Smrdelj. Ms Mynott reported to Mr Williams; and
e)the email sent by Ms Mynott on 1 March 2016 at 12.39pm had as the subject “I’ve had Ece with me for an hour. Do you have any free time to discuss this afternoon? B”. There was no content within the body of the email. Ms Mynott subsequently spoke to Mr Williams. She was not asked in cross examination about the content of that conversation. She did not tell any other person about her conversations with either Ms Smrdelj or Mr Williams.
Ms Mynott had spoken with Mr Williams. What then was known to Mr Williams? In his role as Director – Human Resources with CSL, Mr Williams’ main focus was at the strategic level and assisting the SALT. He had very little interaction with Ms Smrdelj during her period of employment. There were only two or three face-to-face interactions between them during that employment. He had a conversation with Ms Smrdelj on 4 March 2016 wherein she initially alleged that she made a complaint. She has now withdrawn such allegation, again on the evidence, appropriately so. Mr Williams described that conversation as informal and nothing more than light-hearted banter. He told no-one about the conversation he had with Ms Smrdelj, and he saw no reason to do so.
Mr Williams was cross-examined during the course of the proceedings. Whilst he could not recollect in any detail what Ms Mynott said to him on 1 March 2016, he could recall that Ms Mynott did not pass on any “complaint” made by Ms Smrdelj to her. Mr Williams did not refer to any complaint being made by Ms Smrdelj to anyone on the basis that he was not aware any complaint had in fact been made.
Ms Smrdelj herself never contacted Mr Williams to say that she wished to make a complaint or that she proposed to make a complaint in relation to her employment at CSL.
Dr Elliott was never told and was not aware of any complaints or proposed complaints from Ms Smrdelj to Dr Adcock and only became aware of Ms Smrdelj’s conversation with Dr Adcock following the issuing of these proceedings. Dr Elliott was never told and was not aware of any complaints or proposed complaints from Ms Smrdelj to Ms Mynott and/or Mr Williams, about her or anyone or anything else at CSL. Dr Elliott only became aware of the alleged complaints or proposed complaints from Ms Smrdelj to Ms Mynott, Dr Adcock and Mr Williams following the issuing of these proceedings.
Structural changes
From December 2015 to January 2016 Mr Williams had participated in ongoing conversations with Mr Schären about Mr Schären’s proposed structural changes to CSL and in particular the manufacturing operations part of CSL. In early to mid-February 2016, Mr Schären informed Mr Williams that he had decided that the Vice-President – Operations role would be split into two separate roles. He told Mr Williams that the two new roles would likely be at senior director level.
On 18 February 2016 Mr Williams emailed a note and draft position descriptions for the two new senior director roles to Mr Schären, informing him that they needed to finalise the position descriptions and get them evaluated by the compensation team. Around this time he also provided those draft position descriptions to Dr Elliott for her input in her capacity as Acting Vice-President – Operations. On the following day, Dr Elliott provided her input on the position descriptions by email to Mr Schären and Mr Williams. Dr Elliott’s draft position descriptions were subsequently approved by Mr Schären. The new roles were then confirmed by the compensation team as being at senior director level.
In early March 2016 Mr Williams was involved in several conversations with Mr Schären and Dr Elliott in which they discussed a number of potential further restructures in manufacturing operations including the implications that the creation of the two new senior director roles would have for positions sitting underneath the replaced Vice-President – Operations role. One of the potential restructures which Dr Elliott proposed during the March meetings was that the Director - Aseptic Filling Operations role held by Ms Smrdelj at the time was no longer required under the new structure.
In a meeting on 2 March 2016, there was also discussed other potential redundancies which were subsequently implemented under the new manufacturing operations structure. Those were:-
a)making the role of Senior Director – Manufacturing, Science and Technology redundant which was held at the time by Dr Adcock. Dr Adcock was subsequently redeployed into another newly-created role as Director – Contract Administration; and
b)making the role of Director – Toll/IG/Albumin/Privigen Bulk redundant which was held at the time by Mr Rob Skok. Mr Skok was subsequently redeployed into a newly-created role as Director – Privigen Bulk and Facility Operations.
On 3 March 2016 Dr Elliott circulated a PowerPoint presentation as to the new manufacturing operation structure. The structure was approved by Mr Schären. Although many of the changes, including a redundancy of the position held by Ms Smrdelj, were proposed by Dr Elliott in her capacity as Acting Vice-President – Operations, Mr Schären was the sole decision-maker in relation to implementation of any of the proposed changes. This was no “rubber stamping” of a decision or recommendation of another person.[3] The decision to restructure was Mr Schären’s. He exercised his own mind on the basis of his long experience, and knowledge obtained concerning the organisation.
[3] Voigtsberger v Pine Rivers Shire Council (1981) 1 IR 198, 206.
Mr Schären authorised Mr Williams to proceed with recruitment for the new roles.
On 3 March 2016 Ms Smrdelj met with Mr Schären to explore the possibility of applying for the Senior Director – Fill/Finish Manufacturing position. Amongst other things, Mr Schären indicated to Ms Smrdelj that if she felt she could meet the challenge she should certainly apply for the position. On 7 March 2016 Ms Smrdelj applied for the Senior Director – Fill/Finish Manufacturing position.
CSL had a number of candidates apply for the Senior Director – Fill/Finish role. Out of those candidates only three were interviewed by CSL. The short list, as provided to Mr Schären, was selected by Mr Williams and Dr Elliott. The short list did not contain Ms Smrdelj’s name. This was because Dr Elliott and Mr Williams considered that the candidates interviewed had more relevant experience and were already operating at a senior director level, unlike Ms Smrdelj. The short-listing decisions were made in conversation with Dr Elliott, Greg Taylor, Head of Engineering, and Mr Schären on 8 March 2016 after the applications had been reviewed. On 8 March 2016 Mr Williams emailed a summary of the conversation had to Mr Schären, Dr Elliott and Mr Taylor. Mr Williams’ email was headed “In Summary” and noted that Mr Arnold Nigsch, Mr Jonah Smith, and Mr David Hartley were to be interviewed as soon as possible, and that six Applicants were not to be so interviewed. Those Applicants included Ms Smrdelj.
After the short-listing, Mr Schären, Dr Elliott, Mr Taylor, Mr Romberg, and Mr Williams were involved in the interview process. Ultimately Mr David Hartley was selected for the position. Mr Romberg was not the decision-maker, Mr Schären was, although he sought Mr Romberg’s opinion and input into the decision. At the time, Mr Hartley was already at a senior director level at CSL in the position Senior Director – Quality. He had wide-ranging in-house experience, not only in operations but also in leading quality in-house and at senior level at CSL’s Parkville business. He also had excellent internal references as a “high performer”. His experience to handle the much broader and senior role of the new position exceeded that of Ms Smrdelj.
Redundancy/Redeployment
At the time of making the appointment of David Hartley, Mr Schären was never told and was not aware of any complaints or proposed complaints from Ms Smrdelj about Dr Elliott or anyone or anything else at CSL, nor was there any discussion of any complaints or proposed complaints by Ms Smrdelj in any of his conversations with Mr Williams or anyone else in the SALT with whom he discussed any recruitment or short-listing decisions regarding the Senior Director – Fill/Finish role.
For Mr Schären it was “crystal clear” that two candidates were going to be interviewed for the new role. One of those candidates obtained the role.
Although Ms Smrdelj was not covered by the CSL Enterprise Agreement 2015, the company followed the same redundancy policy which applied under that agreement in relation to Ms Smrdelj. That included a six-week consultation and redeployment period. Mr Williams played a limited part in implementing the redundancy and redeployment process. The process was mainly handled by Ms Mynott. In her capacity as the Senior Human Resources Business Partner, it was her responsibility to manage redundancies and redeployment for all employees at the Broadmeadows site except in relation to the SALT which was Mr Williams’ responsibility.
On 11 March 2016 Ms Smrdelj attended an interview with Dr Elliott and Ms Mynott wherein she was informed that her role had been made redundant. Redeployment was discussed with Ms Smrdelj.
On 17 March 2016 Ms Smrdelj sent an email to Ms Mynott indicating that she wished to be redeployed. On the following day Ms Mynott responded to the email in which she acknowledged that Ms Smrdelj was seeking redeployment.
Ms Smrdelj made no application during the redeployment process for any position at CSL. Unfortunately neither party could find a suitable position for Ms Smrdelj to be redeployed.
On 22 April 2016 Ms Smrdelj attended a meeting with Ms Mynott in which she was advised that her application for redeployment was unsuccessful and that her employment would end effective immediately.
For the first time and in cross-examination, Ms Smrdelj lead new evidence that in seeking redeployment at CSL after her redundancy, she sought a meeting with a senior manager from Marburg who was visiting the CSL Broadmeadows site and that Ms Mynott said to Ms Smrdelj that Dr Elliott was tasked to arrange the meeting with this Senior Manager and did not do so. Dr Elliott was not cross-examined as to this new allegation. The Court considers it a recent invention of the Applicant and gives such evidence no weight.
Additionally, Ms Smrdelj gave evidence that an advertisement seeking an employee for work with CSL was, in fact, an advertisement, post her departure, for her previous job. This claim cannot be sustained. The advertisement related to a job that was a lower level position and a supporting role only. The responsibilities and duties of Ms Smrdelj in her job were not replicated in the advertised job.
Did Ms Smrdelj make a complaint in relation to her employment as provided for in s.341(1)(c)(ii) of the FW Act?
The word “complaint” is not defined in the FW Act. Relevantly, in Shea v TRUenergy Services Pty Ltd (No 6) [2014] FCA 271, Dodds-Streeton J said at [626] – [627]:-
“As held in Ratnayake, it is, in my view, unnecessary that the employee, in making a complaint that he or she is able to make, expressly identifies the communication as a complaint or grievance, or uses any particular form or words. It is necessary only that relevant communication, whatever its precise form, would be reasonably understood in context as an expression of grievance or a finding or fault which seeks, whether expressly or implicitly, that the employer or other relevant party at least take notice and consider the complaint.
Whether an employee has made a complaint is a matter of substance, not form, which should be determined in the light of all relevant circumstances. It does not depend solely on the words used. An employee’s communication of a grievance or accusation could amount to making a complaint within the meaning of s 341(1)(c)(ii) despite an express disavowal of any intention to complain if a reasonable observer would conclude from the employee’s words and conduct in the circumstances (including the nature and gravity of the grievance or accusation) that he or she intended to bring the grievance to the employee’s attention for consideration or other appropriate action”.
Section 340(1) of the FW Act provides that “a person must not take adverse action against another person because the other person has exercised a workplace right”. The definition of “workplace right” contained in s.341(1)(c)(ii) of the FW Act includes the ability of an employee to make a complaint or inquiry in relation to that employee’s employment.
Ms Smrdelj relied upon her conversation had with Ms Mynott in the late February 2016 meeting during which Ms Smrdelj claims that she made, very clearly, a complaint to Ms Mynott in Ms Mynott’s capacity as Senior Human Resources Business Partner. Ms Smrdelj asserts that the complaint made by her was in relation to her employment because it was about the conduct of Dr Elliott and Mr Bruegger in the workplace. Ms Mynott referred to the conversation as being about a number of general interactions between Ms Smrdelj and others in the workplace.
CSL argued that the meeting between Ms Smrdelj and Ms Mynott was initiated by Ms Mynott, prior to the date of the alleged conduct of Dr Elliott and Mr Bruegger, and its subject matter was the behaviour of an employee under the supervision of Ms Smrdelj. It was following the meeting that Ms Smrdelj then spoke to Ms Mynott about herself. No complaint was formally made, but of course that is not necessary. Ms Mynott, in accordance with Ms Smrdelj’s wishes, did not convey to anyone else that a complaint had been made. Ms Mynott did not characterise it as a complaint. However, the relevant circumstances are such that the Court accepts in accordance with legal principles that a complaint was made by Ms Smrdelj, albeit Ms Mynott did not regard it as such, or subsequently refer to it in any way as such.
Adverse action was taken by CSL against Ms Smrdelj being:-
a)the restructure of the organisation to render Ms Smrdelj’s job redundant; and/or
b)the alleged failure to appoint Ms Smrdelj as the new Senior Director – Fill/Finish Manufacturing and/or to redeploy Ms Smrdelj into another role within CSL; and/or
c)the termination of Ms Smrdelj’s employment.
CSL will have contravened s.340(1) if it is established that:-
a)Ms Smrdelj’s complaints and inquiries (or her right to make them) fall within the meaning of “workplace right” under the Act;
b)CSL took adverse action against Ms Smrdelj; and
c)the exercise of the “workplace right” was “a substantial and operative” reason for CSL’s decision to take the adverse action.[4]
[4] Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500, 522-3 (French CJ and Crennan J); 535 (Gummow and Hayne JJ).
Section 361 of the FW Act creates a statutory presumption that adverse action was taken for a proscribed reason unless CSL proves otherwise.[5]
[5] Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd (2015) 230 FCR 298, 335.
Did CSL take adverse action against Ms Smrdelj because of the exercise of a workplace right?
In Maxutova v Nunn Media Pty Ltd [2017] FCCA 2336 His Honour Judge McNab considered State of Victoria (Office of Public Prosecutions) v Grant [2014] FCAFC 184 where Tracey and Buchanan JJ stated at [32]:-
“…the leading authority on the operation of ss 360 and 361 of the Fair Work Act in the context of Part 3-1 of that Act (which includes s 351) is Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500; 220 IR 445. The principles which informed this decision were recently reaffirmed by a majority of the High Court in Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2014] HCA 41. Relevantly, these authorities establish that:-
• The central question to be determined is one of fact. It is: “Why was the adverse action taken?”
• That question is to be answered having regard to all the facts established in the proceeding.
• The Court is concerned to determine the actual reason or reasons which motivated the decision-maker. The Court is not required to determine whether some proscribed reason had subconsciously influenced the decision-maker. Nor should such an enquiry be made.
• It will be “extremely difficult to displace the statutory presumption in s 361 if no direct testimony is given by the decision-maker acting on behalf of the employer.”
• Even if the decision-maker gives evidence that he or she acted solely for nonproscribed reasons other evidence (including contradictory evidence given by the decision-maker) may render such assertions unreliable.
• If, however, the decision-maker’s testimony is accepted as reliable it will be capable of discharging the burden imposed on the employer by s 361.”
Counsel for Ms Smrdelj did not challenge the plausibility of the evidence given by CSL’s witnesses, nor their truthfulness, save for Mr Schären and Dr Elliott. These witnesses, it was submitted, had lied, and their evidence should not be accepted. The Court finds no merit in that submission. The evidence of Mr Schären was both plausible and consistent. He was an impressive witness who was very straight forward in his approach. He made appropriate concessions. He was honest. His role is complex and his actions were not determined by anything Ms Smrdelj said or did of which he had absolutely no knowledge. They were focussed on benefitting a very large organisation. Dr Elliott likewise gave an honest account. Their testimony was similar because, as said by Mr Schären, it was truthful. Their evidence was reliable evidence.
CSL has established on the evidence that the actions taken by it were not taken because of Ms Smrdelj’s exercise of a workplace right to complain about the conduct of Dr Elliott and/or Mr Bruegger or indeed any other person or matters. The relevant decisions as to the restructure of the organisation and redundancy and termination of Ms Smrdelj were taken by Mr Schären solely. Mr Schären was “absolutely not aware” of any complaints made by Ms Smrdelj or proposed complaints or discussions had with Ms Mynott at any time. Any such matters were not the reason or indeed formed any part of the reason for his restructuring of the organisation.
The decision to appoint Mr Hartley to the position of Senior Director – Fill/Finish Manufacturing was a decision solely of Mr Schären. Mr Schären did not read the applications of those who were not shortlisted for the job. The shortlist was arrived at by the decision of Mr Williams and Dr Elliott. Neither Dr Elliott nor Mr Williams had knowledge about any complaint made as to Dr Elliott’s conduct or indeed any complaint made by Ms Smrdelj at all until after the institution of proceedings by Ms Smrdelj. No part of their decision-making related to any complaint made by Ms Smrdelj.
No redeployment positions were suitable and available for Ms Smrdelj and indeed Ms Smrdelj applied for no other job within CSL.
The application fails on all grounds and must be dismissed.
I certify that the preceding one hundred and thirteen (113) paragraphs are a true copy of the reasons for judgment of Judge Hartnett
Date: 17 November 2017
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