The Markovski and Vasilevski Unit Trust T/A Elite Property Care Pty Ltd v Toni Krstevski

[2017] FWC 6671

[2017] FWC 6671

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.120—Redundancy pay

The Markovski and Vasilevski Unit Trust T/A Elite Property Care Pty Ltd
v
Toni Krstevski
(C2017/5726)

DEPUTY PRESIDENT CLANCY MELBOURNE, 20 DECEMBER 2017

Variation of redundancy pay.

[1] On 18 October 2017, The Markovski and Vasilevski Unit Trust T/A Elite Property Care Pty Ltd (Elite Property Care) applied for an order under s.120 of the Fair Work Act 2009 (the Act) for a variation of its obligation to make redundancy payment to its former employee Mr Toni Krstevski and that the varied obligation be nil. The application is made on the basis that Elite Property Care obtained other acceptable employment for Mr Krstevski.

[2] As the length of Mr Krstevski’s service was approximately 18 years when his employment with Elite Property Care ceased on 29 September 2017, the redundancy entitlement sought to be varied by Elite Property Care is in the amount of 12 weeks’ pay.

[3] On 12 December 2017, I made an order varying the redundancy pay that was otherwise due to Mr Krstevski by reducing it to nil. These are my reasons for making that order.

Relevant factual background

[4] The grounds upon which the application was made are set out at question 2.1 of the Form F45A application prepared by Mr James Markovski, Office Manager at Elite Property Care, who stated as follows:

“Mr Krstevski is currently working as a cleaner at 10-16 Queen Street. The cleaning services for this building were until the 29 September 2018, performed by Elite Property Care trading as Crusader Property Services. Our cleaner for the site was Mr Krstevski. On 31 August 2017, Elite Property Care was informed that we had lost the tender for the provision of cleaning services at 10-16 Queen Street to another company, Shah and Sons Property Solutions Pty Ltd. After discussing with Mr Krstevski his wishes, and Mr Krstevski indicating he wished to remain at 10-16 Queen Street if possible, I emailed the Operations Manager of Shah and Sons, Mr. Azfar Shah, requesting that he consider employing Mr Krstevski. I subsequently had a telephone conversation with the owner of Shah and Sons, Mr. Azhar Shah regarding Mr. Krstevski’s situation, and his desire to remain a cleaner at 10-16. Azhar advised that it was likely he would retain Mr Krstevski’s services. Elite Property Services concluded its services at 10-16 Queen Street on 29 September 2017. The cleaning has since been provided by Shah and Sons, who have since employed Mr Krstevski as their own employee”.

[5] Mr Krstevski was given notice of the application and provided with copies of the material filed by Elite Property Care on 19 October 2017. On 23 October 2017, I caused correspondence to be sent to Mr Krstevski requesting that he provide his view on the application by close of business on Monday 30 October 2017.

[6] Following telephone conversations on 26 and 27 October 2017 between my chambers and Ms Dijana Krstevski, Mr Krstevski’s daughter, an extension request was made for an additional two weeks for Mr Krstevski to provide any material in relation to the application. Mr Krstevski’s request was granted and he was given until 13 November 2017 to file his response.

[7] As no material had been received, an email was sent to Mr Krstevski on 14 November 2017 seeking advice as to the status of his response. Following further correspondence with Ms Krstevski on 23 November 2017, an email was received by my chambers which stated “As discussed on the telephone, Toni Krstevski will not be making a (sic) application to review the application sought which is to reduce the redundancy pay to nil” (emphasis in original).

[8] I discussed the application with the parties at the Fair Work Commission on 8 December 2017. Mr Markovski was in attendance for Elite Property Care, together with Mr Krstevski and a Macedonian interpreter.

[9] Mr Markovski produced additional material in support of Elite Property Care’s application, including file notes and emails related to its efforts to obtain acceptable alternative employment for Mr Krstevski. This material included a summary of a meeting it held with Mr Krstevski on 15 September 2017 at which it discussed his intentions regarding work, in light of Elite Property Care’s loss of contract to provide cleaning services at the 10-16 Queen Street premises.

[10] This summary detailed the advice received from Mr Krstevski that he has cleaned at the same building since his arrival in Australia in 1999 and that he “does not want to clean at any other site, given that he already works full-time in Campbellfield during the day”. Following Elite Property Care informing Mr Krstevski that it would be able to redeploy him at other sites including St Kilda Road and Moorabbin, it was asserted that Mr Krstevski responded by saying these were unsuitable and subsequently “reemphasised his desire to remain at 10-16 Queen Street”. Mr Markovski submitted he then advised Mr Krstevski that he would “try his hardest to ensure” the incoming contractor employed him as their own cleaner and would keep in regular touch with him concerning this.

[11] In this regard, Mr Markovski made available email correspondence between himself and the Operations Manager of the incoming contractor company, Shah and Sons Property Solutions Pty Ltd (Shah and Sons). This correspondence included an email sent by Mr Markovski on 18 September 2017 to Mr Azfar Shah in which he passed on Mr Krstevski’s details. This email stated the following:

“Dear Azfar,

Congratulations on winning the Contract for the provision of cleaning services at 10-16 Queen Street.

I am writing to pass on the contact details of a staff member, Toni Krstevski, who wishes to remain a cleaner at 10-16.

As you know, Toni has worked there since 1999, and as such, has extensive knowledge of the building and its cleaning requirements. He is also very well-liked by the tenants at 10-16.

…

If you have any interest in retaining Toni’s services, please feel free to get in touch with him and discuss as necessary.”

[12] A further file note was provided of a telephone call between Mr Markovski and Mr Azhar Shah on Wednesday 20 September 2017. It records they discussed the employment situation of Mr Krstevski. It further records that following Mr Markovski providing information as to Mr Krstevski’s experience and working hours, Mr Shah advised him that Shah and Sons intended to retain his services as a cleaner, subject to meeting him in order to assess his suitability. Subsequently, on Monday 2 October 2017, Mr Markovski telephoned Mr Krstevski to inquire as to whether he had been employed by Shah and Sons. In this conversation, he said Mr Krstevski informed him that he had been retained by Shah and Sons, before further advising that he was happy to remain at the 10-16 Queen Street site and thanking Mr Markovski for his help in that regard.

[13] In addition to this material, Elite Property Care referred to clause 14.5 of the Cleaning Services Award 2010 (the Award)which provides as follows:

“Change of Contract

(a) This clause applies in addition to clause 9––Consultation regarding change of contract and section 120(1)(b)(i) of the Act and applies on the change of a cleaning contract from one cleaning contractor (the outgoing contractor) to another (the incoming contractor).

(b) Section 119 of the Act does not apply to an employee of the outgoing contractor where:

(i) the employee of the outgoing contractor agrees to other acceptable employment with the incoming contractor, and

(ii) the outgoing contractor has paid to the employee all of the employee’s accrued statutory and award entitlements on termination of the employee’s employment.

(c) To avoid doubt, section 119 of the Act does apply to an employee of an outgoing contractor where the employee is not offered acceptable employment with either the outgoing contractor or the incoming contractor.”

[14] Elite Property Care also produced pay advices it provided to Mr Krstevski dated 10, 24 and 31 October 2017, along with evidence that the accrued long service leave entitlements were paid to him on 31 October 2017.

[15] For his part, Mr Krstevski confirmed he had been paid out his entitlements by Elite Property Care and that he was working for Shah and Sons at 10-16 Queen Street for the same rate of pay and the same hours.

Consideration and conclusion

[16] It seems to me, having regard to the matters to which I refer above, which are not disputed, that Elite Property Care obtained acceptable employment for Mr Krstevski with the incoming contractor Shah and Sons. I am satisfied that Elite Property Care, through its actions, established an opportunity for employment with the incoming contractor which suited Mr Krstevski. I also regard the offer of employment made by Shah and Sons to Mr Krstevski as alternative employment which is of a kind that is acceptable within the meaning of s. 120(1)(b)(i) of the Act.

[17] It was also apparent from the material submitted by Elite Property Care that in addition to fulfilling the requirement of clause 14.5(b)(i) of the Award by obtaining other acceptable employment for Mr Krstevski, it has also fulfilled clause 14.5(b)(ii) by paying Mr Krstevski all of his accrued statutory and award entitlements upon the termination of his employment.

[18] On the basis of advice from the parties, I am therefore satisfied that the circumstance set out in s.120(1)(b)(i) of the Act has been made out and it is open to me to exercise my discretion under s.120(2) of the Act to make the order sought.

[19] The application to vary the obligation of Elite Property Care to make redundancy payment to Mr Krstevski is granted. The amount of redundancy pay to which Mr Krstevski is entitled is reduced to nil.

[20] An order to this effect has already been issued in PR598595.

DEPUTY PRESIDENT

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