The Australian Workers' Union v Murrumbidgee Irrigation Limited
[2010] FWA 1783
•5 MARCH 2010
[2010] FWA 1783 |
|
DECISION |
Fair Work Act 2009
s.739 - Application to deal with a dispute
v
Murrumbidgee Irrigation Limited
(C2009/10851)
MURRUMBIDGEE IRRIGATION LIMITED WORKPLACE AGREEMENT 2008
[AC315527]
Water, sewerage and drainage services | |
COMMISSIONER ROBERTS | SYDNEY, 5 MARCH 2010 |
Redeployment and redundancy - s.739 of the Act.
[1] This decision concerns an application by the Australian Workers’ Union, Greater NSW Branch (the AWU or the Union) made pursuant to s.739 of the Fair Work Act 2009 (the Act) for the settlement of a dispute concerning the application of the Murrumbidgee Irrigation Limited Workplace Agreement 2008 (the Agreement). Murrumbidgee Irrigation Limited (MIL) is the Respondent to both the Agreement and this application.
[2] The application was the subject of unsuccessful conciliation before me on 23 November 2009 in Sydney. Directions were issued on 23 November 2009 for the filing of submissions, witness statements and supporting documents. That process concluded on or about 21 January 2010. The application was then heard before me in Griffith, NSW on 28 January 2010. The AWU was represented by Mr S Crawford and MIL by Mr D Graham.
Background
[3] The basis of the AWU application concerns the redeployment of one of its members, Mr M Webb, by MIL to the position of Weed Officer (also known as Weeds Control Officer) from his previous position as a Carpenter. Mr Webb has been working as a Weed Officer since July 2009 but believes that the position does not constitute suitable alternative employment and accordingly he should be made redundant by MIL. MIL refuses to make Mr Webb redundant and views the redeployment as being reasonable.
The terms of the Agreement
[4] Clause 28 (Dispute Settlement Procedure) relevantly provides at subclause 28.8:
“28.8 If the dispute remains unsettled the matter shall be notified to an appropriate dispute resolution provider. If parties cannot decide who should conduct dispute resolution, then either party may apply to the Australian Industrial Registry. There is then a further two week period during which the parties must try to agree on the dispute resolution provider. If they are still unable to agree, then the Australian Industrial Relations Commission (AIRC) will provide dispute resolution services. Should the matter be referred to the AIRC for arbitration then their decision will be binding on the parties involved.”
[5] Clause 25 provides:
“25 MANAGING DISPLACED EMPLOYEES
25.1 Displaced employees are those whose position is no longer available due to a restructure within the Company. When required the Consultative Committee may be involved to determine the required support services for displaced employees prior to a significant Company restructure.
25.2 The Company is to inform displaced employees, in writing, when their positions are to be declared no longer available and advise them of redeployment options and the range of services and information sources available to them.
25.3 Redeployment may involve placement in a position of a different remuneration with a difference in salary (as a guide 5% of salary). Displaced employees who are redeployed to a position with a lower salary shall receive pay maintenance for a period of at least 12 months.
25.4 Displaced employees must make themselves available for redeployment and accept reasons le redeployment opportunities when at the existing salary.
25.5 Displaced employees who are redeployed shall be provided with all necessary training to develop the skills and competencies required to carry out the duties of any new position.
25.6 If a displaced employee refuses an offer of redeployment and that offer was to another position at the same or higher position work level and in the same location, the employee will be provided with a notice of termination, but will not receive any redundancy entitlements.
25.7 Displaced employees may be offered redundancy.
25.8 During any period of notice given to an employee whose employment is to be terminated due to redundancy, the employee may take reasonable time off to attend job interviews at times that are mutually agreed to.
In addition, the Company will provide free career and financial counseling services on request to a redundant employee, or, alternatively, the Company will reimburse the employee up to $500 (including GST) for career or accredited financial counseling. The employee will be reimbursed under this clause after providing the employer with a receipt for the career or financial services provided.”
[6] Clause 26 (Redundancy) relevantly provides at Subclause 26.1
“26.1 General
Redundancy occurs when the job the employee has been doing is now not required to be undertaken, and where this situation is not due to the ordinary and customary turnover of labour. This may happen because of changing operational requirements, the introduction of new technology, economic downturns, company mergers, take-overs or restructuring.
Prior to the Company providing redundancy appropriate consultation will take place with the employee and if necessary the employee representative. In addition to the period of notice prescribed for ordinary termination, an employee whose employment is terminated by reason of redundancy will be eligible for one of the following entitlements at their ordinary rate of pay:”
Evidence
[7] Mr Webb and Mr Goring (an AWU Organiser) gave sworn evidence for the AWU. Mr S Wood (Human Resources Officer), Mr D Rudd (Works Program Coordinator) and Mr G Beard (Executive Manager) gave sworn evidence for MIL.
Mr Webb
[8] Mr Webb submitted a witness statement. 1 In summary, it was his witness statement that he commenced work for MIL in January 1981 as an apprentice Carpenter. He completed his apprenticeship in 1984 and worked in his trade until 2005. In his work as a Carpenter Mr Webb was responsible for maintaining the workshop and associated equipment and was also responsible for design, manufacture and installation of formwork. In 2005 the workshop closed and he performed unskilled work as a Field Operator for a short time and then took up a position as a Depot Clerk in the Depot Office. He had performed that role on many occasions over the previous eight to nine years. He found the Depot Clerk position to be an enjoyable challenge with a higher status than the Carpenter role.
[9] Mr Webb’s witness statement went on to say:
- “I was given many responsibilities in this job [Depot Clerk] including:
- It was a comfortable indoors job dealing mostly with computer work.
- “I viewed this position as like a reward for me after working for so many years out in the field.”
- In August 2008 the Depot Clerk position was made redundant as part of a restructure.
- “I was informed that my position was finished and that they had no immediate plans for me.”
- Late in August 2008 the carpentry workshop reopened and Mr Webb recommenced work as a Carpenter, being classified as a Leading Hand Carpenter (Level 2). That work continued until July 2009 “when I was told that there was not enough work for a Carpenter and the workshop was closed again.”
- “From August 2008 until July 2009 there was not much carpentry work available and I was mainly doing unskilled labouring work and landscape gardening at the CSIRO site. I was also occasionally directed to drive a tractor/slasher and slash access tracks along irrigation channels and to spray weeds.”
- He was redeployed to the position of Weed Officer in July 2009. He had declined to consider a position as a Channel Attendant.
• Open and closing the depot gates and buildings
• Timekeeper
• Dealing with contractors
• Involvement with contract tendering
• Maintenance request system
• Dealing with the public”
[10] Mr Webb does not believe that there is any possibility of him returning to a full time Carpenter position in the future despite there being “discussion about a new depot (CSIRO site) having a Carpenter’s workshop but on a much smaller scale than we previously had. The size of this workshop changes from meeting to meeting.”
[11] The Weed Officer position involves spraying weeds growing in irrigation channels. It is a “boring and mundane” task requiring few skills and attracting a lower rate of pay than the job of Carpenter. His salary will be maintained for a period of twelve months. Mr Webb considers “moving into the Weed Officer position to be a clear demotion in terms of pay, status and quality of employment. I view this position as a real kick in the guts after so many years of service to Murrumbidgee Irrigation. I feel that the fact they are only offering me this job indicates that they don’t really want me.”
[12] Mr Webb believes that it would be fair to offer him redundancy to allow him to “move on to another job that I find fulfilling and rewarding. My position as a Carpenter has been genuinely made redundant and I feel that I am entitled in all the circumstances to be paid a redundancy in accordance with our Agreement.”
[13] In cross-examination, Mr Webb:
- Agreed that he is a displaced employee for the purposes of the Agreement. 2
- Agreed that the Griffith carpentry shop is still intact. 3
- Agreed that he had been informed that he would be re-employed as a Carpenter when carpentry work becomes available. 4
- Agreed that he undertook a training course to take on the Weed Officer position, saying that the course ran for some two days. 5
- Agreed that the Weed Officer role was a significant one in ensuring that water flows freely through irrigation channels. 6
- Agreed that he had the option to resign from MIL. 7
- Was asked: “So Murrumbidgee Irrigation, not exercising the right it has to declare your job as redundant, has actually found you somewhere else to work as a long-term employee. It has found you something else to do?” and answered: “Yes, they found me another job, yes.” 8
- Agreed that the salary maintenance arrangements were for a minimum of twelve months, not a fixed term of twelve months. 9
[14] In re-examination, Mr Webb said that unskilled staff were now to be trained in carpentry skills, thereby lessening the chance of him returning to a full time Carpenter role. 10
[15] Mr Webb went on to say that the two day training course to take up the Weed Officer position compared with his four year apprenticeship to become a Carpenter. 11
[16] He went on to say that he believed there was significant carpentry work available outside MIL and he could find a suitable position quite easily. 12
[17] Mr Webb was recalled for further cross-examination, which concerned his refusal to consider a Channel Attendant position and agreed that the Channel Attendant position paid a higher rate than that of a Carpenter. 13 He said that he refused the Channel Attendant position because of the requirement to work on weekends and his view that the future of the position was not secure in the light of automation.
[18] In further re-examination, Mr Webb said that the Channel Attendant position would also not utilise his carpentry qualifications. 14 He had never received a formal offer to be redeployed as a Channel Attendant.15
Mr Goring
[19] Mr Goring submitted a witness statement 16. In summary, it was his witness statement that:
- His role is to represent MIL employees who are members of the AWU and he was involved in negotiating the Agreement.
- “The intent of the Agreement is certainly for employees to be offered a redundancy when their position disappears and there is no other suitable position available.”
- Mr Webb’s willingness to move to the role of Depot Clerk shows “his willingness to be flexible and take on new roles, as long as the position is a step forward and a new challenge.”
- Mr Webb’s work vehicle was taken away from him in June 2009.
- “The Weed Officer position is clearly a significant demotion for Mark. The Weed Officer position basically comes from labouring positions that have been renamed and slightly altered following the restructure. The position used to be called Labourers in Weed Poisoning.”
- “I think that management are trying to exaggerate the possibility of the workshop reopening to help their argument that Mark should not be offered a redundancy.”
[20] In cross-examination, Mr Goring agreed that there had been discussions with MIL about Mr Webb taking up a Channel Attendant position but maintained that no formal offer was ever made. 17
Mr Wood
[21] Mr Wood submitted a witness statement 18. Mr Wood’s statement concerned the evolution of MIL from being a State Owned Corporation to a private company and the intent of the redeployment provisions of the Agreement. He went on to say: “The Company has operated under a well documented 10 year drought which has resulted in substantially reduced general and high security water allocations and of course substantially reduced income generated. Redundancies have been given in extreme cases and in accordance with our Workplace Agreement. The Company cannot afford the luxury of gifting a redundancy if the Business has an operational requirement to redeploy Mark to an important (and vacant) position in the Company. Redundancy has been used as a last resort.”
He described the Weed Officer as being “a specialised role within the Company requiring specific training and mentoring. The position is not a labouring role and has never been called ‘Labourers in Weeds Poisoning’ - not even colloquially. It is not directly supervised and it is debatable whether the weeds role is much less responsible and prestigious than a Carpenter’s function in the Company.”
[22] In cross-examination, Mr Wood agreed that Mr Webb’s move to Depot Clerk was partly due to a lack of work in his carpentry position. 19 He further agreed that there was no full time Carpenter role in Griffith after 2005.20
[23] Mr Wood went on to say that Mr Webb returned to carpentry work when the Depot Clerk position was made redundant. 21
[24] In re-examination, Mr Wood said that any redundancies which had occurred were largely voluntary. 22 He was asked: “If you could think of one of the voluntary redundancies, can you think of the circumstances that occurred where the company accepted it?” and answered: “Where we had, in case of a restructure, whereby the person may be coming to retirement age and they were - discussions have been with them or they expressed the interest to accept a - to take a voluntary redundancy, to apply for a voluntary redundancy, because the additional training or movement out of their comfort zone was beyond them. And that happens when technology comes into it - into play.”23
Mr Rudd
[25] Mr Rudd submitted a witness statement 24. In his statement, Mr Rudd set out aspects of Mr Webb’s employment history and said in relation to the Weed Officer role: “In March 2009 Mr Webb completed training in chemical weed control and from that time has worked controlling weeds in the immediate area around Griffith. This position requires detailed technical knowledge for mixing and applying to weeds. It is a position with a high degree of health and safety considerations and important to the Company.”
[26] Annexed to Mr Rudd’s witness statement was a Position Description for ‘Vegetation Control Officer’ issued on 13 January 2010. The Vegetation Control Officer is the successor title to Weed Control Officer. I have paid regard to the annexure.
[27] In cross-examination, Mr Rudd agreed that when Mr Webb returned to a carpentry role in 2008, there was insufficient full-time carpentry work and he supplemented that work with other duties. 25 He was asked: “Ultimately it became apparent that there was insufficient work in there and that Mr Webb needed to move to another role, which is how he ended up in the weed officer role. Is that right?” and answered: “Correct.”26
[28] In re-examination, Mr Rudd clarified that the position of Channel Attendant is also referred to as a Division Operator.
Mr Beard
[29] Mr Beard submitted a witness statement 27. It was Mr Beard’s statement that in late August/early September 2008 Mr Webb expressed reluctance to return to the carpentry shop. He went on to say: “The first time that Mr Webb raised the question of redundancy was at a performance and development meeting in July 2009. At that time my response was that as re-deployment was available to a position close in income and within his skills that no redundancy would be available to him. The position was one that Mr Webb had been trained in and been working in that position since approximately April 2009.”
[30] He further said: “The position of MI is that there is, at this time, insufficient work for a Carpenter in Griffith, but the Carpenter’s workshop is being maintained in the expectation that the drought will eventually end and carpentry work will again be a full time role. Until that occurs, most carpentry work is being undertaken from the Leeton workshop.”
[31] He considers that the Weed Officer role is a specialist one “and important to the business close in skill to his role as a carpenter.”
[32] In cross-examination, Mr Beard agreed that the amount of carpentry work performed by MIL employees has diminished over recent years. 28 When discussing the aftermath of the elimination of the Depot Clerk position, Mr Beard was asked: “Ultimately, that process resulted in Mr Webb being offered the weed officer position. Is that right?” and answered: “Yes. At the end of the day, I suppose you could say other options that were explored were either declined or didn't come to fruition.”29
[33] Mr Beard was then asked: “Do you accept that you actually informed Mr Webb that if he refused to perform those weed officer duties, he risked termination?” and answered: “I may have, yes. I don't recall those words, but I certainly may have.” 30
[34] Mr Beard said that in his view it was not “a step back for Mr Webb to go from his carpentry position to the Weed Officer role”. 31
[35] In re-examination, Mr Beard said that he did not recall telling Mr Webb that he might be dismissed if he did not accept redeployment but was not maintaining that he didn’t say it. 32
Submissions
AWU
[36] Mr Crawford filed a written outline of submissions 33. The AWU’s position on behalf of Mr Webb is that he should be made redundant pursuant to the terms of the Agreement. Mr Crawford’s core argument is that the Weed Officer role does not constitute suitable alternative employment and does not utilise his trade qualifications. The Weed Officer role is at a lower salary than the Carpenter position and Mr Webb did not have to accept the new role, pursuant to subclause 25.4 of the Agreement. Mr Webb has already been redeployed from his original Carpenter position to that of Depot Clerk then back to the Carpenter position and then to the Weed Officer position. The Company has consistently refused to consider making Mr Webb redundant and the Tribunal should find that Mr Webb’s situation triggers the redundancy provisions in the Agreement.
[37] Mr Crawford also made oral submissions. I have paid regard to those oral submissions.
MIL
[38] MIL filed a written outline of submissions 34. Mr Graham submitted that Mr Webb “must co-operate with a proposal to be re-deployed and equally clear that it is the Respondent’s prerogative to offer Redundancy as set out in Clause 26.” Mr Graham relied on the Redundancy Test Case Decisions35 handed down by the Full Bench of the former Australian Industrial Relations Commission. He argued that the Redundancy Test Case Decisions provided for transfers to lower paid duties.
[39] Mr Graham went on to argue that: “In this case no formal declaration of ‘redundancy’ in respect of the carpenter position has been made. The position, and workshop, has been retained; there is simply not enough work for a carpenter at Griffith and hasn’t been for at least a year. The Respondent has the ability to transfer Mr Webb to a lower paid position consistent with the Test Case provisions ... In the case of Mr Webb he receives income maintenance for one year for re-deployment.”
[40] Mr Graham also made oral submissions. I have paid regard to those oral submissions.
Conclusions and Findings
[41] The only real common ground between the parties in this case is that Mr Webb is a displaced employee within the meaning of subclause 25.1 of the Agreement.
[42] In a letter to Mr Webb dated 14 September 2009 36, Mr Beard said:
“RE: Displaced Employee
As you have been made aware and confirmed with you in recent discussions the tasks associated with your position as a carpenter have been diminishing over time, so much so that you have been assigned duties which reach well outside the intended role as a carpenter. Such assignments were to ensure you remain gainfully employed and to produce a productive outcome for the Business. Following the recent Company re-structure it is now evident that the role of a full time carpenter in the Griffith Centre is superfluous and will be left vacant in the foreseeable future.
However a redeployment opportunity has arisen in the Weeds and Drainage Team and therefore you are now formally offered a position as a Weed Officer. In accordance with section 25.3 (clause hereunder) of the Company's Workplace Agreement 2008 you will receive salary maintenance for 12 months before commencing alignment to the position of a Weeds Officer.
‘25.3 Redeployment may involve placement in a position of a different remuneration with a difference in salary, (as a guide 5% of salary). Displaced employees who are redeployed to a position with a lower salary shall receive pay maintenance for a period of at least 12 months.’
You will be provided with all necessary training to develop the skills and competencies required to carry out the duties of your new position. Under the circumstances redundancy is not currently an option.
If you wish to accept the offer of redeployment with full acknowledgement of the above arrangements please return the attached agreement form to me or a member of the Human Resources team by Thursday 17th September 2009.
If you wish to discuss this matter further please feel free to call and arrange a suitable time.”
[43] In practice, Mr Webb has worked in the Weed Officer role since April 2009 although he has never formally agreed to the redeployment.
[44] Mr Beard subsequently sent a further letter to Mr Webb dated 26 November 2009 37, in the following terms:
“RE: Displaced Employee
I refer to my letter dated 14 September 2009 in relation to your redeployment to the role of Weeds Officer, which in part states;
‘that the tasks associated with your position as a carpenter have been diminishing over time, so much so that you have been assigned duties which reach well outside the intended role as a carpenter. Such assignments were to ensure you remain gainfully employed and to produce a productive outcome for the Business. Following the recent Company re-structure it is now evident that the role of a full time carpenter in the Griffith Centre is superfluous and will be left vacant in the foreseeable future.’
It should be added that although the role as a carpenter is vacant there may be tasks that will require your skills as a carpenter to be utilised in the future. When this occurs you will be remunerated at the appropriate tradesmen's rate.
All other information contained in the letter 14 September remains unchanged and relevant to the redeployment, referenced to our Workplace Agreement 2008.
If you wish to accept the offer of redeployment with full acknowledgement of the above arrangements please return the attached agreement form to me or a member of the Human Resources team by 2nd December 2009.
If you wish to discuss this matter further please feel free to call and arrange a suitable time.”
[45] I have paid little regard to Mr Beard’s second letter to Mr Webb, given that it was written following conciliation proceedings in the Tribunal and in the knowledge that the arbitration of Mr Webb’s case was scheduled. I do not impute any dishonest intent on Mr Beard’s part but his letter of 26 November 2009 is not material which can guide me in the current proceedings.
[46] From the evidence, submissions and materials before me I have reached the following conclusions in relation to Mr Webb and the application of clause 25 of the Agreement to him:
- The Company did not follow the provisions of subclause 25.2 of the Agreement until after Mr Webb had been redeployed to the Weed Officer role. The Channel Attendant role was discussed with him but never proceeded with by either him or the Company.
- Redeployment to the Weed Officer role would result in a difference in salary of approximately 10%. This falls well outside the guideline of 5% as set out in subclause 25.3 of the Agreement.
- The redeployment of Mr Webb does not accord with subclause 25.4 of the Agreement in that the Weed Officer position is not at his pre-existing carpenter rate on an ongoing basis after pay maintenance ends.
- Mr Webb has been provided with Weed Officer training as provided for in subclause 25.5 of the Agreement.
- Mr Webb has not refused an offer of redeployment “to another position at the same or higher position work level …” The only formal offer made to him was to redeploy him as a Weed Officer at a lower rate of pay and in a lower status occupation with salary maintenance for at least twelve months.
- MIL has refused to offer redundancy pursuant to subclause 25.7 of the Agreement.
- Subclause 25.8 of the Agreement is not relevant to this decision.
[47] In my view, and I so find, the redeployment of Mr Webb to the Weed Officer role is not compliant with clause 25 of the Agreement. The evidence of Company witnesses that the Weed Officer role is reasonably equivalent to that of a Carpenter is untenable. This was largely conceded by Mr Graham. 38 The very fact that the Weed Officer role attracts a lower rate of pay supports my view. In addition, Mr Webb undertook a four year apprenticeship to become a qualified Carpenter and the Weed Officer role requires around two days training.
[48] I now turn my attention to the redundancy provisions in clause 26 of the Agreement. There is no doubt in my mind that it is highly unlikely that Mr Webb would ever be returned to a full time Carpenter role with MIL. His situation appears to fall squarely within the provisions of subclause 26.1 of the Agreement, particularly the first paragraph of that subclause. There has been no full time role as a Carpenter in Griffith since at least 2005.
[49] It is therefore my finding that the redundancy provisions of the Agreement apply to Mr Webb and he should be made redundant under the terms of clause 26 of the Agreement. The redundancy should be effected at the Carpenter rate of pay.
COMMISSIONER
Appearances:
S Crawford for the Australian Workers’ Union, Greater NSW Branch.
D Graham for Murrumbidgee Irrigation Limited.
Hearing details:
2010.
Griffith:
28 January.
1 Exhibit AWU 2.
2 Transcript PN116.
3 Transcript PNs120-125.
4 Transcript PN146.
5 Transcript PN156-161.
6 Transcript PNs171.
7 Transcript PNs177-178.
8 Transcript PN184.
9 Transcript PN189.
10 Transcript PNs215-216.
11 Transcript PN217.
12 Transcript PN218-219.
13 Transcript PN273 and following.
14 Transcript PNs281-282.
15 Transcript PN287.
16 Exhibit AWU 3.
17 Transcript PN327.
18 Exhibit MIL 1.
19 Transcript PN357.
20 Transcript PN366.
21 Transcript PNs372-375.
22 Transcript PN413.
23 Transcript PN422.
24 Exhibit MIL 2.
25 Transcript PN454.
26 Transcript PN455.
27 Exhibit MIL 3.
28 Transcript PN485.
29 Transcript PN490.
30 Transcript PN495.
31 Transcript PN522.
32 Transcript PNs538-540.
33 Exhibit AWU 4.
34 Exhibit MIL 4.
35 [PR032004 and PR062004]
36 Attachment MW1 to Exhibit AWU 2.
37 Attachment A to Exhibit MIL 3.
38 See transcript PNs638-639.
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