SRG Global Integrated Services Pty Ltd v Justin Evans
[2024] FWC 3157
•15 NOVEMBER 2024
| [2024] FWC 3157 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s 120—Redundancy pay
SRG Global Integrated Services Pty Ltd
v
Justin Evans
(C2024/5393)
| COMMISSIONER LIM | PERTH, 15 NOVEMBER 2024 |
Variation of redundancy pay – whether other acceptable employment offered – alternate role constituted other acceptable employment – redundancy payment reduced by 75%.
Introduction
SRG Global Integrated Services Pty Ltd has applied pursuant to s 120 of the Fair Work Act2009 (Cth) to vary its obligation to pay redundancy pay to a former employee, Mr Justin Evans. SRG seeks to reduce Mr Evans’ entitlement to redundancy pay under s 119 of the Act from four weeks to nil on the basis it obtained other acceptable employment for Mr Evans. Mr Evans does not agree.
Having considered the evidence and materials in this matter, I am satisfied pursuant to s 120 that SRG obtained other acceptable employment for Mr Evans. I have decided to exercise my discretion to reduce Mr Evans’ redundancy entitlement from four weeks to one week in the circumstances.
My detailed reasons follow.
Background
The following facts are not contested between the parties:
(a)From March 2023 to July 2024, Mr Evans was employed as a Rope Access Technician Level 2 Mechanical Fitter on a full-time basis.[1] He was based at the Albemarle Lithium Mine and his employment was covered by the SRG Global Integrated Services Pty Ltd (Albemarle) Enterprise Agreement 2023.[2]
(b)Through his employment, Mr Evans signed two employment contracts. Both contracts expressly stated that he “may be required to work at other project locations and for other business units where the Company operates its business”.[3]
(c)Over June 2024, SRG representatives met with several employees, including Mr Evans, to discuss that SRG’s core maintenance work at Albemarle was ceasing. Mr Evans was told that SRG was looking into options for him and that there would be further discussions. Mr Evans expressed his desire to work an even-time roster to better accommodate his child caring responsibilities.
(d)On Tuesday 25 June 2024, SRG representatives met with Mr Evans and advised him that due to operational downturns at Albemarle, his position would be made redundant. Mr Evans was offered two alternative positions with SRG based at Alcoa and South32 for his consideration. This included two contracts of employment for him to read over.[4]
(e)Mr Evans was also advised that SRG could offer him an even-time roster with GeoTech, which is an associated entity of SRG. However, the role was on a Fly-In, Fly-Out basis.
(f)On Wednesday 26 June 2024, Mr Evans emailed SRG to advise that the three options were not suitable for the following reasons:
(i)Alcoa Wagerup was too far from his home;
(ii)South32 Worsley would be a move from maintenance to project work, which provided less job security with increased travel time and a different roster; and
(iii)GeoTech would be a step backwards.[5]
(g)Mr Evans stated that that in his view the only acceptable option was redundancy.[6]
Legislation
Section 119 of the Act provides for the following redundancy pay entitlements:
“119 Redundancy pay
Entitlement to redundancy pay
(1)An employee is entitled to be paid redundancy pay by the employer if the employee’s employment is terminated:
(a)at the employer’s initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or
(b)because of the insolvency or bankruptcy of the employer.
Note: Sections 121, 122 and 123 describe situations in which the employee does
not have this entitlement.Amount of redundancy pay
(2)The amount of the redundancy pay equals the total amount payable to the employee for the redundancy pay period worked out using the following table at the employee’s base rate of pay for his or her ordinary hours of work:
Redundancy pay period Employee’s period of continuous service with the employer on termination Redundancy pay period 1 At least 1 year but less than 2 years 4 weeks 2 At least 2 years but less than 3 years 6 weeks 3 At least 3 years but less than 4 years 7 weeks 4 At least 4 years but less than 5 years 8 weeks 5 At least 5 years but less than 6 years 10 weeks 6 At least 6 years but less than 7 years 11 weeks 7 At least 7 years but less than 8 years 13 weeks 8 At least 8 years but less than 9 years 14 weeks 9 At least 9 years but less than 10 years 16 weeks 10 At least 10 years 12 weeks
Section 120 of the Act provides:
“120 Variation of redundancy pay for other employment or incapacity to pay
(1) This section applies if:
(a) an employee is entitled to be paid an amount of redundancy pay by the employer because of section 119; and
(b) the employer:
(i)obtains other acceptable employment for the employee; or
(ii)cannot pay the amount.
(2) On application by the employer, the FWC may determine that the amount of redundancy pay is reduced to a specific amount (which may be nil) that the FWC considers appropriate.
(3) The amount of redundancy pay to which the employee is entitled under section 119 is the reduced amount specified in the determination.”
Consideration
In this matter, I am satisfied on the evidence that Mr Evans was entitled to be paid four weeks redundancy pay in accordance with s 119 of the Act.
SRG did not contend that it cannot pay the amount.
In relation to s 120(1)(b)(i) of the Act, the Full Bench in Australian Commercial Catering Pty Ltd Powell and Togia; Powell v Australian Commercial Catering Pty Ltd[7] set out that the test in relation to s 120(1)(b)(i) of the Act is an objective one and is not determined by reference to whether the employment is subjectively acceptable to the employee.[8] Further, that the once the preconditions in s 120(1) are satisfied, the determination of whether to reduce an employee’s entitlement to redundancy pay requires the exercise of a broad discretionary power.[9]
In Spotless Services Australia Limited t/as Alliance Catering,[10] Deputy President Sams helpfully summarised authorities on what “other acceptable employment” means and relevantly stated:
“[65] The above decisions have some common features, including:
·The test of what constitutes ‘acceptable employment’ is an objective one It does not mean it must be acceptable to the employee.
·Acceptable employment is not identical employment, as no two jobs could be exactly the same.
·An employee must meaningfully cooperate with the employer in exploring or considering options for alternative positions.
·An employee’s prima facie entitlement to redundancy pay may be at risk if the employee refuses a role or position, which is found to be objectively ‘acceptable’.
·The acceptance of alternative employment by one or more persons in a group of redundant employees, does not necessarily make the alternative employment ‘acceptable’ for all of them. Each employee’s individual circumstances must be taken into account.
·There are a range of factors of varying weight, according to an employee’s particular circumstances, which may be taken into account to assess the acceptability of alternative employment.”
4.1 Did SRG obtain other acceptable employment?
SRG offered three redeployment options to Mr Evans:
(a)Rope Access Level 2 at South32 – Worsley Alumina in Collie (South32 Position).
(b)Rope Access Level 2 at Alcoa Wagerup or Pinjarra (Alcoa Position).
(c)Ground Support-Rope Access Level 2 with GeoTech in Kalgoorlie on a FIFO basis (GeoTech Position).
As part of its materials, SRG helpfully submitted a comparison of Mr Evans’ position at Albemarle against the three redeployment options (Role Comparison).[11] The Role Comparison breaks down the following details:
employment basis;
client site;
location;
travel time from Mr Evans’ home;
terms and conditions;
shift length and roster;
rate of pay; and
allowances.
Mr Evans did not contest the accuracy of the Role Comparison.
The main differences between Mr Evans’ previous role and the redeployment options can be summarised as follows:[12]
| Albemarle | South32 Position | Alcoa Position | GeoTech Position | |
| Annual salary based on ordinary hours | $160,643.34 | $173,753.42 | $171,125.96 | $126,487.47 |
| Roster | Five days on, Mon-Fri. | Four days on, three days off, Mon-Fri. | Four days on, Mon-Fri. | Seven days on, seven days off. |
| Shift length | 10 hours plus 30-minute unpaid meal break | 12 hours inclusive of 30-minute paid meal break | 10 hours inclusive of unpaid meal break. | 12-hour days inclusive of paid meal breaks. |
| Travel to and from home | 24-30 minutes. | 45-50 minutes. | 55 to 65 minutes. | FIFO. |
Mr Evans’ position at Albemarle
There was some contention over the hours that Mr Evans worked in his position at Albemarle. His base hours were rostered as 10-hour shifts with a 30-minute unpaid meal break. SRG provided evidence that in the 2023/2024 financial year Mr Evans worked 471.5 hours outside of his base roster through a combination of mostly night shifts and overtime. SRG said that this shows that the hours offered in the alternative roles are not dissimilar to the hours Mr Evans worked at Albemarle.
Mr Evans submitted that he occasionally worked 12-hour shifts over the year for personal reasons. He also said that he had the choice to not work the additional hours, and that they were effectively not as onerous compared to the alternative positions due to the shorter distance between Albemarle and his home. I accept that Mr Evans chose to work 12-hour shifts from time to time.
South32 Position
Mr Evans submitted that SRG informed him that the projects team had three weeks of work, but SRG was confident more work would be awarded. He said that this made the job insecure. Further, the increased working hours each day and increased travel time would have impacted on his personal caring commitments.
Mr Evans did not provide any further evidence about the South32 Position having only three weeks of work other than a conversation with an unnamed representative from SRG. The contract for the South32 Position clearly states that the position was a full-time one. I cannot accept Mr Evans’ submission on this point.
I accept that the South32 position would have required Mr Evans to stay at work for 90-minutes longer and involved approximately 46 minutes of travel rather than 27 minutes. However, the test isn’t whether the alternative position is identical to the employee’s position at the time – it is whether it is acceptable. I have taken into consideration that the compressed roster had an additional day off each week and a higher base wage. I find that the South32 Position was acceptable other employment.
Alcoa Position
For completeness, I will also consider the other two alternative roles. Mr Evans submitted that the drive from his house to the Alcoa sites would have been an additional 40-minute drive each way. This would have required him to start his day at 4:00am, which would have impacted on his ability to take his son to school activities. I accept Mr Evans’ submissions in this regard. However, I have taken into consideration the higher base pay, 30-minute shorter workday and an additional day off each week. I find that the Alcoa Position was acceptable other employment.
GeoTech Position
Mr Evans submitted that this role was far removed from the role he had at Albemarle. Mr Evans said that geotechnical rope access work involves levering loose rocks off pit walls and doing this work at heights. He submitted that whilst it pays well, it was outside his trade and experience.
Regardless of whether this role was outside of Mr Evans’ trade and experience, I do not consider that the GeoTech Position was acceptable other employment. That is because it would have required Mr Evans to go from a role where he would have been home each night to a FIFO role. Even though the GeoTech Position had an even time roster, Mr Evans would be away from home half the time. That is a significant change.
4.2 Is it appropriate to reduce Mr Evans’ redundancy entitlement?
The answer to the above is ‘yes’, but not to nil as SRG has requested. I have taken into account the parties’ submissions and given weight to the following:
· there is no dispute that SRG meaningfully consulted with Mr Evans, offered him different positions and looked out for a role that had an even-time roster; and
· Mr Evans’ contracts with SRG provided an explicit term that SRG could move him to different sites in accordance with operational needs.
In the circumstances, I find it appropriate to reduce Mr Evans’ redundancy entitlement to one week. An Order to this effect will issue separately.[13]
COMMISSIONER
Hearing Details:
Determined on the papers.
Final written submissions:
Wednesday 4 September 2024.
[1] Annexure SRG-01 March Contract, 15 March 2024.
[2] Ibid.
[3] Annexure SRG-01 March Contract, 15 March 2024; Annexure SRG-02 October Contract, 18 October 2024.
[4] Annexure SRG-03 South32 Contract; Annexure SRG-04 Alcoa Contract, 25 June 2024.
[5] Annexure SRG-07 Respondent’s Email, 26 June 2024.
[6] Ibid.
[7] [2016] FWCFB 5467.
[8] Ibid [37].
[9] Ibid.
[10] [2016] FWC 4505.
[11] SRG-05 Comparison of Alternative Roles, 21 August 2024.
[12] SRG-06 Financial Comparison, 21 August 2024.
[13] PR781298.
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