The Roman Catholic Church Trust Corporation of the Archdiocese of Hobart T/A Archdiocese of Hobart (Schools & Colleges) v Independent Education Union of Australia-Victoria Tasmania Branch, Jennifer Johnson

[2022] FWC 638

[2022] FWC 638

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.739—Dispute resolution

The Roman Catholic Church Trust Corporation of the Archdiocese of Hobart T/A Archdiocese of Hobart (Schools & Colleges)
v

Independent Education Union of Australia-Victoria Tasmania Branch,  Jennifer Johnson

(C2021/6896)

Commissioner Wilson MELBOURNE, 23 MARCH 2022

Alleged dispute about any matters arising under the enterprise agreement and the NES; [s.186(6)] – Severance pay.

1. Teachers in Catholic schools in Tasmania are covered by the Tasmanian Catholic Education Single Enterprise Agreement 2018 (the Agreement), which covers two employers, The Roman Catholic Church Trust Corporation of the Archdiocese of Hobart and the Provincial Salesians of Don Bosco Australia-Pacific. The Archdiocese operates 37 schools and colleges through a body known as the Catholic Education Trust (CET). One of those schools and colleges, the subject of this dispute, is Guilford Young College. The College is a senior secondary college, operating on two campuses in Hobart and Glenorchy for years 11 and 12 only.

1. The Applicant in these proceedings is the CET which lodged an application under s.739 of the Fair Work Act 2009 (the Act) with the Fair Work Commission (the Commission) on 13 October 2021. The Respondent is the Independent Education Union of Australia-Victoria Tasmania Branch (IEU) in respect of its member Jennifer Johnson. The IEU also lodged a dispute application regarding the same matter on 13 October 2022, shortly after the lodgement of the CET application.[1] The IEU noted in the covering email of their application they were content not to have the attached application dealt with separately, as both applications were in relation to the same dispute.[2]

1. The dispute is regarding the quantum of redundancy payments to be made to Jennifer Johnson by CET. Mr Dennis Matson, Senior Industrial Officer, appeared for the IEU and Ms Samantha Masters, solicitor from Edge Legal appeared for the CET. Permission was granted to the CET to be represented by a lawyer, with me being satisfied the criteria within s.596(2)(a) had been enlivened. Witness Statements and oral evidence were received on behalf of CET from Craig Deayton, the Principal of Guilford Young College, and Richard Heyward, CET’s Manager of Employee Relations. On behalf of the IEU and Ms Johnson, Witness Statements and oral evidence were received from the IEU Organiser, Jeremy Oliver, and from the Respondent, Ms Johnson.

1. The application was the subject of conciliation before me on 3 November 2021. After the matters in dispute were unresolved and the Commission was advised that CET desired the dispute to be arbitrated, it was programmed for arbitration, with the hearing listed for 18 January 2022.

BACKGROUND

1. There is a library at both of Guilford Young College’s campuses.[3] The dispute has been triggered by a review of these libraries’ operations conducted in July 2020 (the Library Review). The outcome of this review was a determination that there should be a restructure of the libraries into an Academic Research Centre (ARC) which operated across both campuses.[4] Amongst other changes resulting from this review, all current library positions were to be made redundant and several new positions were to be created: an Academic Research Leader and two Academic Research Centre Assistants.

Ms Johnson’s Personal Circumstances

1. Ms Jennifer Johnson, who is the subject of this dispute, had slightly more than 18 years of continuous service with CET as Library Technician at the time the application was lodged.[5] In her employment with CET, Ms Johnson was initially employed at another school within its operation, MacKillop Catholic College, from 2 September 2003 to 4 April 2008, then with Guilford Young College from 4 April 2008 to her termination on 11 October 2021.

1. Prior to Ms Johnson’s employment in library services, she was outside of the paid workforce for approximately 18 years, from 1990 to 2003, while involved in the task of raising her children. During this time, she completed a Diploma in Library and Information Services which allowed her to obtain a relief role as a Library Technician at TAFE Tasmania in 2003, where she worked prior to her employment with CET at MacKillop Catholic College.[6] In 2008, Ms Johnson also completed an Advanced Diploma in Library and Information Services.[7]

1. Ms Johnson turned 61 in late December 2021. She states her expectations for the future both before and after her redundancy were to work until at least the age of 65, and likely longer than this due to the fact she would not be eligible for the age pension until the age of 67. Due to her years outside of the workforce raising children, Ms Johnson notes her superannuation balance is not high enough for her to consider an earlier retirement on the basis of her superannuation.[8]

1. Ms Johnson lives with her husband, who works as an engineer installing and maintaining machines at Royal Hobart Hospital. Their home is mortgaged, and Ms Johnson states that herself and her husband do not have the resources to be without an income for any extended period.[9]

1. Ms Johnson reports since her redundancy she has been looking for work and applied for three positions for which she has not received an interview. She also reports she has been applying for relief work at Libraries Tasmania. She notes that all the roles for which she has so far applied pay less than she was paid in her previous role, and that the number of roles available in the greater Hobart area is scarce.[10] She further states that she feels her age is impacting her ability to secure employment.[11]

1. Ms Johnson had accrued long service leave at the time of her dismissal, which was continuing to accrue at 1.3 weeks per year of service under the Agreement. Upon starting another job, should she obtain a position, Ms Johnson notes that she is unlikely to become eligible for further long service accrual prior to her retirement. Due to this, there is the potential that Ms Johnson has lost approximately 9 weeks of long service leave which she would have accrued had it not been for her redundancy.[12]

1. Ms Johnson has health concerns which arose in late 2020 and have continued up until the time of her employment termination, largely connected with high blood pressure. She reports a high level of stress and problems sleeping associated with her redundancy and termination. [13]

The Events of 2020 and 2021

1. The circumstances leading to Ms Johnson’s redundancy broadly include a decision by Guilford Young College to restructure its library operations as a response to “the reliance on information technology resources and related services, and the growing role of e-Learning in education”. A review by the College of its library services developed this case for change;

“There is substantial research on the future of libraries that must be considered by the College so that it can adequately prepare students for the demands of further study and work and it is highly desirable that GYC is at the forefront of using innovative services to meet these future challenges.

It is also important to note that research points to the growing need to reimagine the traditional school library. It was apparent in reviewing that research, through consultation with teachers and in feedback from students about what attracts young adults (GYC students) to spaces for research and study, that freedom of movement, provision of group and solo working spaces, availability of silent and 'noisy' working spaces, amenity for comfort and freedom to relax, to have places to eat and drink - all contribute significantly to creating an effective, harmonious and welcoming learning environment.

GYC also needs to offer a high level of information, research, e-Learning and IT services to students and adopt contemporary practices in the senior secondary educational setting. In the proposed model, provision of these services will become the primary role of the Academic Research Leader who will have responsibility for the Academic Research Centre facilities on both campuses. This role replaces the dual roles of librarian on each campus who have nominal 'sole responsibility' for separate libraries and will ensure that the same service provision, access to resources, policies and procedures operate on both campuses as a unitary organisation delivering high-quality education and access to online and physical resources for the students at the College.

The Academic Research Leader will work with two Academic Resource Centre Assistants (one for each campus) to encourage teaching staff, students and the wider community to contribute to the building of relevant Academic Resource Centre collections and information databases. The Academic Research Leader will be located across both Hobart and Glenorchy campuses.

The Academic Research Leader also has responsibilities in personnel management and communication and, working in collaboration with the Curriculum and Pedagogy Team, provides workshops for the teaching staff and students with a focus on Study Skills, Academic Research and e-Learning. The Academic Resource Centre's priority is to support teaching, and student and staff research in the College and to develop relevant resource collections. The Academic Research Leader provides a regular point of contact with College leadership through Directors of Pedagogy.”[14]

1. The College’s review made numerous recommendations including that its library services and sites, ICT services, and e-Learning, would be merged into the newly formed Academic Research Centre (ARC), and that all current library positions would become redundant with the Centre’s ongoing resourcing consisting of one Academic Research Leader and two Academic Research Centre assistants. The ARC Leader would, for the purposes of the Agreement, be classified at the level of Business Services Six and the ARC Assistants at the level of Library Services Three.

1. Ms Johnson was notified in December 2020 of the outcome of the Library Review.[15] Over the course of two meetings between Ms Johnson, Mr Oliver and Mr Deayton on the 8^th and 16^th of December several possible pathways were discussed for Ms Johnson in light of the Library Review. These were: redeployment to an as yet unfinalized ARC Assistant role, voluntary redundancy, and forced redundancy.[16] [17]  It is contentious between the parties what representations were made about Ms Johnson’s suitability for the unfinalised ARC Assistant role at these meetings.[18]

1. During the meeting on 16 December 2020, and in further correspondence between the parties on that same day, there was also negotiation as to what the terms of a voluntary redundancy for Ms Johnson might be. At the meeting, Mr Deayton proposed a payment of 20 weeks’ pay should Ms Johnson take a voluntary redundancy; Mr Oliver sought a higher amount. Later that day, Mr Deayton called Mr Oliver and increased the payment amount to 25 weeks’ pay. Mr Deayton then reiterated the offer in an email while also providing further options of the timing of the redundancy. Following this, the focus of negotiations shifted to the necessity of the Separation Agreement and Mr Heyward took over negotiations from Mr Deayton. The question of whether CET was permitted to impose a further condition (being the execution of a deed of settlement) upon the making of an offer of a voluntary redundancy or the payment of a severance payment was referred to the Commission and dealt with in Independent Education Union of Australia (130N) v Roman Catholic Church Trust Corporation, Archdiocese of Hobart T/A Guilford Young College [2021] FWC 1942.[19]

1. On 21 December 2020, Ms Johnson indicated she would forgo redundancy and accept redeployment to the ARC Assistant role. Mr Deayton states that this acceptance was “for a short time from the beginning of 2021”.[20]

1. The nature of the work which Ms Johnson then proceeded to perform in 2021 is also a matter which is contentious between the parties. The position description of ARC Assistant was still in draft form at this time, with the expectation that it would undergo refinement in consultation with the ARC Leader once appointed.[21] It was, however, sufficiently defined for it to be understood to be at the same conditions and salary point as Ms Johnson’s previous role as a Library Technician. Both the ARC Assistant position and the position of Library Technician were classified as Level 3.5 roles.[22]

1. It is undisputed between the parties that Ms Johnson was paid at Level 4.1, the level of Librarian, rather than at Level 3.5 from 1 February 2021 to 1 April 2021 (Term One).  Different reasons for this are given by the parties.

1. Mr Deayton states that Ms Johnson was paid at this level “as a temporary replacement for Sandy von Allmen while the new ARC leader commenced his duties and familiarised himself with all aspects of the former Library’s and new ARC’s operations”.[23]  

1. Ms Johnson states that she was placed at the Hobart Campus at the beginning of 2021 as a replacement for the librarian who had departed from the Hobart campus in March of 2020. During Term One of 2020, Ms Johnson states she was assisted in this role by Sandy von Allmen, a qualified librarian, who was working at the other school site, the Glenorchy Campus. Ms Johnson states that the departure of Ms von Allmen and her own movement from Level 4.1 back to Level 3.5 occurred simultaneously at the beginning of Term Two. [24]

1. The parties are also in disagreement as to the nature of Ms Johnson’s work following her return to payment at Level 3.5. Part of this disagreement appears to arise from a lack of clarity between the parties regarding whether what was in existence during this period was an ARC or two libraries.

1. Following the departure of Ms von Allmen, there was no qualified librarian at either campus. Due to this absence Ms Johnson states she was “running the library at both campuses” while being paid at level 3.5.[25] In reply, Mr Deayton has put that “no management responsibility for the ARC or other ARC employees was given to Ms Johnson, nor was she offered a position with these responsibilities.”[26]

1. The lack of clarity about this question seems to have been exacerbated by delays in the appointment of the ARC Leader. The initial ARC Leader was appointed in late May 2021 shortly following the end of Term One and Ms Johnson’s return from Level 4.1 to Level 3.5. That person occupied the position for less than a month, finishing on 10 June, and did not develop a position description for the ARC Assistant role.[27]

1. Following the departure of the initial ARC Leader, there was a period of approximately a month with no ARC Leader appointed. Following this. another person was appointed as acting ARC Leader on 6 August.

1. As the ARC Assistant role which Ms Johnson returned to on 1 April 2021 reported directly to the ARC Leader and its position description remained in draft form pending finalisation by an ARC Leader, it seems apparent there would have been a lack of clarity for Ms Johnson regarding the nature of her role in the approximately four-month period prior to the second ARC Leader’s appointment and following her return to payment at Level 3.5 as an ARC Assistant.

1. It is unlikely this lack of clarity would have been alleviated during the first ARC Leader’s appointment, who Ms Johnson states informed her that “the role he was given was not what he had applied for and been interviewed for”.[28] Regardless of the accuracy of this statement, it is clear from the brevity of the person’s service that he was unlikely to have taken on the full responsibility with which the role of ARC Leader was intended to be endowed.

1. Ms Johnson states it was in large part due to this lack of clarity that, on 15 June 2021 via the intermediary of Mr Oliver, she expressed an interest to Mr Deayton in accepting a voluntary redundancy. [29] 

1. Following this, on 19 July 2021 a letter was sent to Ms Johnson offering a voluntary redundancy package as the sole alternative to a forced redundancy. In this letter, Ms Johnson’s positions is classified as Library Services, Level Three, Salary Point Five. The offer was quantum of $32,879.26 as the equivalent of 20 weeks’ pay, $8,219.82 being five weeks’ notice of termination and $3,600.28 for accrued entitlements, the signature of an attached Separation Agreement, and a date of termination of 16 July 2021.

1. On 23 July 2021 Ms Johnson, by way of the IEU, responded with a counter-offer of voluntary redundancy severance payment of 40 weeks’ pay, five weeks’ pay as notice, payment of accrued entitlements, the date of termination as Friday 30^th of July, and no Separation Agreement, with Ms Johnson instead offering to sign terms to the effect that: the redundancy was genuine, no further claims will be made subject to the usual exclusions for workers’ compensation and superannuation, and the settlement amount to be confidential. This was viewed as a rejection by CET, who responded by commencing concluding all other aspects of redundancy provisions within the Agreement.[30]

1. On 23 September 2021 representatives from CET met with Ms Johnson and Mr Oliver and discussed the further steps to be taken under the redundancy process. At this time, Mr Oliver indicated to the CET representatives that a severance payment of 26 weeks would be acceptable to Ms Johnson. [31]

1. Following this meeting, on 27 September 2021 Ms Johnson was sent correspondence from CET advising of her proposed redundancy and providing her with an opportunity to give reasons as to why she should not be made redundant. [32] Ms Johnson advised in response that it was not her intention to provide reasons why her employment should not be terminated due to redundancy.[33]

1. Then, on 11 October 2021, Ms Johnson received a final letter of termination advising that her position was redundant as of that date and that she would receive 12 weeks’ redundancy pay, five weeks’ pay in lieu of notice, any leave entitlements owing and any outstanding pay up to and including her date of termination. A response was then sent to CET from the IEU notifying Mr Heyward that Ms Johnson does not accept the proposed settlement payment of 12 weeks’ redundancy pay but would agree to the amount of 25 weeks’ pay as severance.

AGREEMENT TERMS AND SUBMISSIONS

1. The terms of the Agreement dealing with redundancy are different from most enterprise Agreements in that they do not prescribe the actual severance payment to an employee, but instead prescribe a process to be followed and that in all the circumstances the payment to an employee must be no less than that provided within the National Employment Standards (NES).

1. Clause 57.2 of the Agreement provides that a School Support Employee, such as Ms Johnson is required to be given a period of notice or paid an amount in lieu on termination of their employment. The scale of notice therein is the same as within the NES. In the case of Ms Johnson, who worked for CET for more than five years and is older than 45 years of age, that amount is five weeks. There is no dispute that a payment in lieu of notice of five weeks was made to Ms Johnson upon the termination of her employment.

1. Severance pay upon redundancy is dealt with in the Agreement in clause 31.4 with the clause providing;

“31.5 Severance Pay

Severance payment in the case of redundancy shall be an amount agreed between the Employer and the Employee(s) who may be represented by the Union in negotiations. In the event of no Agreement being reached, the matter may be resolved pursuant to the Dispute Settling Procedure in this Agreement. The amount payable shall not be less than the entitlement under the National Employment Standards.”

1. The availability of a voluntary redundancy process as well as the matters dealt with in the earlier decision reinforces that the provisions in clause 31.5 means what it says; that is, the amount of severance pay in a particular case is an amount agreed between the employer and the employee, and that failing such agreement it is a matter to be resolved pursuant to the dispute resolution procedure in Clause 7, which allows for arbitration of an unresolved dispute.

1. Neither party submitted the Commission could not determine the dispute or that it was constrained in doing so.

The CET’s submissions

1. After noting that the Commission has a unique power under the Agreement to determine the amount of severance pay the CET argues there are no particular facts in Ms Johnson’s case which would justify payment over the NES.[34] CET also argue the Commission’s decision about severance pay must be within bounds and is not an entirely unfettered discretion. It submits any decision of the Commission in determining the amount of severance pay should take into account three broad factors; the purpose of severance pay and the underpinning of the NES entitlements; specific impact on the employee of the circumstances of their redundancy; and the history of negotiation between the parties in attempting to reach an Agreement about the amount of severance payment and the parties’ respective interest.[35]

1. The CET argues the Commission should be guided by the principles within National Union of Workers v Employers’ Chamber of Commerce & Industry (Vic) (Redundancy Case)[36] recently affirmed and summarised in National Tertiary Education Union v Deakin University (Deakin).[37]

1. Having regard to these principles, the CET submits that, after noting that the NES entitlement for Ms Johnson would be 12 weeks’ pay, there are no particular circumstances which would justify a severance payment over and above the NES entitlement.[38] The CET notes Ms Johnson was first notified her position may be made redundant in December 2020 and was not ultimately made redundant until October 2021. She had an opportunity to negotiate a voluntary redundancy and attempted to do so. Those negotiations broke down over the requirement put forward by CET that Ms Johnson enter into a Separation Agreement pertaining to the severance payment. CET further assert Ms Johnson was offered but rejected redeployment to an alternative role at the same salary and conditions. Ms Johnson rejected the proposal and subsequently attempted to negotiate a voluntary redundancy whilst indicating this was her preferred outcome from the redundancy situation.

1. Pertaining to the Redundancy Case principles, CET argues that there is nothing in the facts suggesting greater than general hardship consideration should be taken into account. Such hardship as experienced by Ms Johnson is mitigated by the extended period of notice given to her, being approximately 10 months, the opportunity she took to negotiate a voluntary redundancy, and the offer it made of redeployment.

1. The CET also argue that no special regard should be had for loss of non-transferable credits in Ms Johnson’s case. It submits that while she held a personal leave accrual there is nothing in her situation beyond the ordinary case which would suggest an increased severance payment should apply, and notes that Ms Johnson had an opportunity to retain her non-transferable credits through redeployment but rejected the offer.

1. As to the trauma associated with Ms Johnson’s redundancy, CET argue that such factors as may be taken into account have been significantly mitigated by the control Ms Johnson had in considering redeployment or voluntary redundancy, as well as the time she had to plan for redundancy.

1. After referring to the details of the notification of the impending redundancy given to Ms Johnson in December 2020, and the events which took place over 10 months until October 2021 when she was finally made redundant, CET argue there is considerable value to it in avoiding forced redundancy through obtaining voluntary redundancies and negotiating severance pay in finalising employment through a Separation Agreement.[39]

1. In this case, CET submits it does not have the benefit of either voluntary redundancy or a Separation Agreement which removes “any benefit” CET might achieve from negotiating severance pay. Rather, it argues the interests of CET were damaged by the additional resources required to be allocated upon the dispute’s referral to the Commission. [40]

1. CET further submit about Ms Johnson’s interests that, apart from negotiation as to the quantum of her payment, she has otherwise lost the opportunity to genuinely negotiate on any terms of the redundancy which might provide a benefit to her, such as the date of redundancy.[41]

1. In conclusion, for the reasons outlined above, CET argue that there are no facts which would justify payment of severance pay over and above the NES entitlement, as well as there being no basis upon which it would reasonably be motivated to make a payment in excess of the NES. In conclusion, CET submit it should not be required to pay anything over and 12 weeks’ pay, being the NES entitlement.[42]

IEU submissions on behalf of Ms Johnson

1. The IEU argues that there are few fixed boundaries within which the Commission works in making a determination of this sort, save that the amount decided upon must not be less than the amount payable under the NES, noting there is no maximum amount that the Commission may order. With regard to the considerations highlighted in the Redundancy Case, the Commission is then free to determine any amount it considers appropriate.[43]

1. The IEU argues that the CET’s value distinction between voluntary and compulsory redundancy is not a factor for consideration and should be regarded as a neutral factor for several reasons:

·  it was not a factor during bargaining nor in the Redundancy Case nor other such cases;

·  the additional costs referred to by CET are a product of implementing the terms of the agreement, willingly made.

·  the failure to reach agreement on voluntary redundancy is a direct product of CETs own decision to require a separation agreement. This separation agreement required by CET is not required by other employers, with the limited exception of the Tasmanian government sector deed, which is said to have no terms covering confidentiality disparagement indemnity damages or the like;[44] and

·  the cost burden referred to by CET has also been equally imposed upon Ms Johnson. 

1. The IEU further argues that the proposition that the severance payment amount should be reduced because Ms Johnson rejected redeployment should itself be rejected when all the circumstances of the situation are considered. According to the IEU, these relevant circumstances are:

·  that the temporary redeployment which Ms Johnson accepted on 21 December 2020 afforded Ms Johnson a level of responsibility, effectively co-ordinating both libraries, which would not be matched in further redeployment;

·  that Ms Johnson’s pay rate had also recently been reduced from the increase which has followed her temporary redeployment into higher duties, with this occurring despite the fact that Ms Johnson’s increased level of responsibility remained;

·  that the new Academic Resource Centre (ARC) Leader had resigned after only three weeks; and

·  that no job description had been written, so the position Ms Johnson was expected to fill remained uncertain, with it having been previously acknowledged that whatever the new role was “it may not be for (her)”. [45]

1. Further, the IEU submitted that without any job description, it could not be said that redeployment was offered as “there was no job capable of being accepted.”[46] Due to this, and the other circumstances outlined above, on 4 August 2021, when the employer moved directly from its first offer of voluntary redundancy to compulsory redundancy (with no further consideration given to redeployment), the IEU argues it could not correctly be said that Ms Johnson had rejected redeployment. [47]

1. The IEU notes the Commission in this case is not engaged in interpreting the terms of the Agreement, and so is not required to confine itself to ascertaining the mutual intention of the parties. However, it submits the task at hand is analogous, and the Commission should accordingly give strong emphasis to the parties’ intention at the time of making the Agreement.  When the Agreement was made there was a common understanding as to the general range in which severance payments would be settled. When employees considered making the Agreement while “the severance amounts were not specified, the understanding of the expected range of payment was communicated to employees, albeit obliquely, and in the context of the offers canvassed through negotiations”, with those offers establishing “a range within which employees were led to believe outcomes would sit”.[48]

1. The IEU submits that there were very few redundancies in Catholic education in recent years with both parties being well aware of redundancies which took place in 2004 at which time seven payments of a base payment plus 2.3 weeks salary per year of service made.[49] The IEU’s organiser Mr Jeremy Oliver gave evidence about the subject.  About that evidence the IEU argues;

“It is conclusively true that while the applicant did not agree to insert 2.3 weeks’ pay per year into the agreement, that quanta was in its mind when it sought to placate employees about its resistance to the Union’s (then) claim for 2.5 weeks’ pay per year. The [CET] was then offering a scale up to 25 weeks’ pay (in identical terms to that contained in the VCEMEA). Whatever else might be said, what was not finally considered was any scale resulting in less than 25 weeks for a person in Ms Johnson’s position.”[50]

1. With respect to the CET’s argument that there are no grounds in Ms Johnson’s case to set a severance payment above the NES entitlement, the IEU argues that the reference in clause 31.5 to the amount payable being no less than the entitlement under the NES was a necessary inclusion in the Agreement as negotiated and made merely for the purpose of ensuring that it could be approved by the Commission without the need for an undertaking. According to the IEU, interpreting the reference to the NES entitlement as a floor from which it is difficult to move would be “at odds with the plain words of clause 31.5, and is at odds with the evidence as to the meaning the [CET] attributed to clause 31.5 when the clause was agreed.” [51]

1. As evidence of the meaning attributed to the clause when agreed, IEU pointed to the fact that when the Agreement was settled the “the parties’ last positions were scales that would result in payments to Ms Johnson of: 25 weeks’ pay ([CET]); and 50 weeks’ pay (IEU).” While a final scale could not be settled between the parties, the IEU cited the fact that this was the scale in consideration when the parties decided to leave the final determination of any amount to the Commission as evidence the intention of the parties was not for the NES entitlements to be considered as the standard quantum in instances of redundancy. [52]

1. Accordingly, the IEU argued that the “almost unfettered discretion” which the CET had conceded the Commission was endowed with in making this determination should not be constrained by the NES minimum to any extent other than as the floor of what might be granted.[53]

1. Referable to matters of fairness between the parties, the IEU notes that the CET is a large and extremely well-resourced employer with around 2,500 employees. Its decision to make Ms Johnson redundant leads only to the CET being one employee down. The rarity of redundancy in the CET’s operation means the total cost of severance payments in this and other cases would have “no impact at all on the employer’s financial position”. On the other hand, notwithstanding the significant consequences of redundancy for Ms Johnson, IEU argues there may well be broader consequences resulting from the Commission’s determination, as it would be highly likely to guide the parties in their approach to future redundancies. If the amount determined by the Commission in this case is within the range of 25 – 50 weeks it is probable the parties will accept the precedent, but if not it is likely the settlement of any future redundancy amounts will require Commission assistance with consequential cost and delay “at the very time when the employee most needs the money”.  After noting these matters, and also that the Commission’s decision in this matter will be likely to influence future bargaining with the nominal expiry date of the Agreement having now passed,[54] the IEU argues that consideration of fairness between the parties weighs heavily in favour of determining the quantum of severance payment at the highest end of the range.[55]

1. In relation to the parties’ conduct, the IEU argues that Ms Johnson has been an exemplary employee while the CET’s conduct has been less than exemplary. Its criticism of the CET includes that the administration of Ms Johnson’s final departure lacked dignity after 18 years’ service, with her being provided with payment in lieu of notice instead of being permitted to work out her notice. The IEU submits this both compounded the trauma of redundancy and failed to afford Ms Johnson an opportunity to apply for new jobs from a position of having a job. The CET also failed to make an announcement to staff about its decision, reduced its voluntary redundancy offer from 25 to 20 weeks without giving an explanation, and refused twice to negotiate the severance amount “in contravention of the terms of the Agreement”.[56]

1. Further in relation to the CET’s conduct prior to the making of the Agreement, the IEU submits that the arguments of the CET mean it “Either misled employees at the time the Agreement was made or is now fundamentally undermining the agreement it made.” [57] This submission was based on statements made in CET bulletins and the Joint Summary of the EBA that the offer of the Applicant “easily exceeds the NES”, that “In the isolated cases that have occurred in the past, good outcomes have been achieved for employees through negotiations” and that those made redundant at Guilford Young College were offered “generous severance payouts”.[58] In light of their context, these statements were clearly made with the intention that employees might place reliance on them in their consideration of the Agreement, and also underpinned the Applicant’s reassurance to employees that they should vote for approval of the Agreement. The IEU submits that the Applicant is now refusing any negotiation of redundancy payments and is unwilling to offer more than the NES minimum and, as such, was either dishonest in making the above statements or prepared to abandon prior assures while the relevant Agreement remains in force and binding.[59]

1. The IEU considers CET’s introduction of a Settlement Agreement as a condition of all redundancies to be highly prejudicial as there had been no such requirement for genuine redundancies prior to 2018. The IEU also notes that the CET reduced “Ms Johnson’s weekly rate of pay after term one, 2021 (despite her role being more demanding) such that on termination her notice and severance payments, being fixed in “weeks’ pay” were also reduced”.[60]

1. With respect to the common principles that apply to the determination of severance payment amounts the IEU submits that the Commission should exercise caution in considering the factors taken into account in the Redundancy Case and Amalgamated Metals, Foundry & Shipwrights' Union v Broken Hill Pty Co Ltd (TCR No 1).[61] The Commission was constrained in those cases from considering individual circumstances as the question for determination was “the absolute minimum severance pay to apply across all awards regardless of the circumstances of the employer.” [62] Such is not the case in this matter.

1. In the above cases it was necessary for the Commission to consider factors such as  “the ability of firms to compete successfully, sometimes on international markets …”, whether “…retrenchment costs would be so high as to drive employers operating at marginal levels of profitability into liquidation”, and about “employers facing trading or financial difficulties”.[63] In contrast, this present matter only requires consideration of the actual circumstances of the parties before it. The IEU submits that in this instance the Commission’s discretion is “unfettered” due to the nature of the employer in question. Specifically, the CET is large, being one of Tasmania’s largest employers with approximately 2,500 staff, and well-resourced, “with the majority of its recurrent income (in the order of 80%) coming from state and federal government grants.” There are very few redundancies within the CET and it “is highly unlikely to face liquidation and consequent mass redundancies.”[64]

1. Pertinent to the NES, it was submitted that the severance payment scale is a minimum standard with the NES itself providing for Agreements to establish higher rates of severance pay and;

“To the extent that the 2004 Test Case provides any guidance, the guidance relates to the identification of the categories of common losses and hardships. The amount of the scale, other than constituting the legal (“safety net”) minimum, is of no real assistance. Otherwise the TCR test cases identify that the following factors were relevant to determining the amount of Award safety net severance payments:

45.1. “compensation for non-transferable credits” including personal leave, long service leave, pro-rata annual leave loading ;

45.2. “inconvenience and hardship” which should “not be given an artificially narrow reading”;

45.3. “length of service”; (and indirectly, age of the employee)

45.4. “Loss of seniority”;

45.5. “Loss of security of employment”;

45.6. Trauma, including “shock, anger, a sense of powerlessness, changes in household relations, change in the structure of everyday life and loss of social interaction”;

45.7. long service leave;

45.8. Industry standards;”[65] (footnotes omitted)

1. The IEU submitted that the Commission should give weight to the severance pay standards applying in the education industry more generally, where an employee in the position of Ms Johnson in the Government sector would be eligible for a payment of 40 weeks’ pay, and that this would be consistent with the Redundancy Case. It submits that parity between CET and Tasmanian Government schools is a longstanding institution and that, while not identical, CET and the union “regularly look to government schools as the base for determining appropriate pay and conditions.” [66] They note this intention can be found expressed in clause 19.2 of the Agreement which reads:

“19.2 Unless otherwise specified in this Agreement, the salaries and allowances of all Employees will be adjusted by the same percentage increase that applies to the Tasmanian State Service, Department of Education Teachers’ salaries at the same operative date.” [67]

1. Mr Oliver’s witness statement includes a summary of Catholic education redundancy payments in various states and territories current to 2014, with the further submission noting significant developments have occurred since that date, with each Catholic jurisdiction providing for severance payments more than the NES minimum without the need for a settlement deed. More generally the IEU argued that certain legacy award provisions should also be taken into account; most pre-2009 State Awards in the education sector, including the Catholic Education Award and Independent Schools (Non Teaching) Award left redundancy payments to negotiation and the Independent Schools (Teachers) Tasmania Award prescribed a scale of severance pay of up to 24 weeks’ pay for a teacher with 11 years’ service.[68]

1. Pertinent to Ms Johnson specific circumstances the IEU argues;[69]

·  her 18 years of continuous service is nearly double the maximum period of service acknowledged in the scale set out in the redundancy case and that given the heavy emphasis on length of service within that case “and the fact that the test case is a safety net, the Commission shall determine a severance amount at the very top of the “range” of 25 – 50 weeks”;

·  the Commission’s consideration of non-compensation for non-transferable credits should compensate Ms Johnson for the loss of accrued personal leave and future accruals of long service leave;

·  particular consideration of the inconvenience and hardship experience for Ms Johnson should be given by the Commission.  Failure to provide any notice of the termination date prevented her from preparing to leave, farewelling colleagues, and applying for other employment.  She subsequently experienced ill-health which she attributed to the stress and uncertainty of the situation.  Further, at 61 years of age with specialised experience and qualifications achieved over a 20-year period she is of the view that job prospects in her field are limited, with it being the case that the marketing Tasmania is small which “is implicitly acknowledged in the redundancy scale that applies to people in Ms Johnson’s position made redundant from a Tasmanian government school.”

·  Ms Johnson will suffer a loss of seniority, loss of security of employment and diminution of her earnings, although conceding it “is axiomatic to say that Ms Johnson’s age and the fact that she is likely to work for only a few more years in libraries, where technology is continuing to make a significant impact, will mean that she can expect to have considerable difficulty in finding work”;

·  the Commission can reasonably infer the trauma of redundancy and its effects on Ms Johnson including from CET’s conduct in;

“• instituting a ‘spill-and-fill’;

• failing/refusing to negotiate;
• providing a role description then withdrawing it;
• failing to provide a new job description,;
• decreasing the redundancy offer;
• withdrawing the salary increase; and
• giving no notice whatsoever of the final termination”;

·  particular to the matter of long service leave, while the Redundancy Case discounted severance payments for service beyond 10 years because of the likelihood of long service leave accruals, it does not appear to have given consideration to circumstances such as that of Ms Johnson “where the service greatly exceeds 10 years and the long service leave has largely been exhausted”;

·  Ms Johnson’s quality of service is an appropriate matter for the Commission to consider in this case even though factor was not taken into account by the Full Bench when setting the across-the-board safety net minimum. An event referred to by Mr Deighton does not change Ms Johnson’s service over 18 years as being anything but of the highest quality. This factor strongly supports the severance payment at the upper end of the indicated scale; and

·  the CET’s submission that there are no special facts that would justify higher severance payment is incomprehensible in the face of the facts of Ms Johnson’s case.

1. In finality, the IEU argues that the Commission should determine on the basis of the factors it has made submissions about that it is appropriate a severance payment of 50 weeks’ pay be made to Ms Johnson.[70]

CONSIDERATION

1. In some respects, the parties do not have much distance between them as to the principles to be relied upon for determination of a suitable amount of severance pay for Ms Johnson.

1. At the highest level the Applicant acknowledges the findings by the Full Bench in Deakin;

“As a matter of basic principle, the purpose of a severance payment for redundancy is to compensate employees for the hardship caused by termination (including the loss of seniority, loss of security of employment and the possibility of less remunerative or otherwise less satisfactory employment in the future), the loss of non-transferable credits, and the trauma associated with the termination.”[71]

1. The basic principle acknowledged by the Full Bench was itself derived from the Redundancy Case.[72] In that case the Full Bench held that considerations of the inconvenience and hardship imposed on employees by redundancy, referring to matters dealt with by the earlier 1984 decision of the Australian Conciliation and Arbitration Commission in TCR No. 1, should not be given an artificially narrow reading with the term being “broad enough to cover areas such as loss of seniority, loss of security of employment and other kinds of losses which were identified in the evidence”.[73]

1. The Redundancy Case took into account an expanded range of considerations including “trauma associated with the termination itself, loss of non-transferable credits such as sick leave, and the potential costs associated with loss of employment security, inferior conditions, loss of seniority, lower job satisfaction or diminished social status.”[74]

1. Trauma associated with termination of employment was found to be a consideration which had the potential to be extremely severe, with effects including “shock, anger, a sense of powerlessness, changes in household relations, change in the structure of everyday life and loss of social interaction.”[75] While the Redundancy Case judgement acknowledged this factor was considered in TCR No. 1, it found that the relationship between an employee’s length of service and the traumatic effects outlined had not previously been fully appreciated.

1. The loss of non-transferable credits was specified as primarily referring to accruals of untaken personal leave and contingent long service leave accruals, with other credits such as pro rata annual leave loading and unpaid parental leave also acknowledged as potentially relevant according to the individual circumstances of a termination. In analysing these factors, it was found that the matter of seniority was generally not suited to precise calculations, but some exact quantification was possible where it came to long service leave, having regard to the standard federal long service leave provision wherein “pro rata leave is payable on termination of employment for redundancy, after 10 years’ service a redundant employee receives 8.7 weeks pay.”[76] However, an employee with less than 10 years’ service would receive nothing under the provision. The Full Bench noted that while it is possible to calculate a pro rata loss for shorter periods of service, consideration must also be given to the fact that such an entitlement remains a contingency until vested, as it may be lost if the employment is terminated for cause or by other means. It concluded that this consideration of contingency must be applied to all other non-transferable credits as well.

2. In its decision, the Full Bench acknowledged the Commission’s practice had been to refuse to award pay out of sick leave credits on termination. However, it determined that the fact that the loss of personal leave entitlements “may lead to subsequent hardship when personal leave is needed but no credit is available” could permissibly be taken into account, albeit with limited weight.[77] Limited weight was also to be given to the loss of parental and annual leave loading.

1. It was further found to be “not appropriate, even if it were mathematically possible to do so, to establish severance pay at levels which fully compensate redundant employees for loss of non-transferable credits.”[78] This was due to the contingent nature of the credits already mentioned, the high cost such an approach would impose upon employers, and the fact that the matter under consideration was fixing award provisions to operate “as a safety net.” Nonetheless, the Full Bench ultimately determined “the loss of non-transferable credits is a significant factor to be taken into account.”[79]

1. Loss of security for employees following redundancy was also found to be evident in the incidence of part-time and casual employment after redundancy from full-time work. Such work was accepted to be “largely involuntary” and “less secure than full-time employment.”[80] The higher vulnerability to retrenchment for employees leaving a workplace where, dependent on the length of their service, they may hold a relative level of security, for a new workplace where they would hold no or shorter service, was also noted as a significant factor. The Full Bench further found “a real likelihood” for work following redundancy to be lower in quality, lower in remuneration, and lower in job satisfaction and social status. [81]

1. Loss of seniority was also noted as relevant, with the extent of this loss depending upon the length of service and being of more significance for longer serving employees.

1. The Full Bench further determined that length of service was an important consideration as it impacted upon the severity of all the factors outlined above, with research showing “that employees with long tenure experience more significant adjustment costs after being made redundant.”[82]

1. The Full Bench then set the scale of severance payments since adopted in the NES at s.119(2), and in doing so provided its reasoning for the reduced severance payment for an employee whose service was 10 years or more;

“We think it is appropriate to extend the severance pay scale from four years of service to 10 years. While the current scale reaches the maximum payment after four years of service, under the formula we have decided upon there will be increases in the amount of severance pay with each year of service between five and nine years. The scale will not go beyond 10 years of service. The new severance pay scale will be as follows:

Period of continuous service Severance pay

Less than 1 year   Nil
1 year and less than 2 years                    4 weeks pay
2 years and less than 3 years                  6 weeks pay
3 years and less than 4 years                  7 weeks pay
4 years and less than 5 years                  8 weeks pay
5 years and less than 6 years                  10 weeks pay
6 years and less than 7 years                  11 weeks pay
7 years and less than 8 years                  13 weeks pay
8 years and less than 9 years                  14 weeks pay
9 years and less than 10 years                16 weeks pay
10 years and over   12 weeks pay”[83]

1. The decision to increase severance payments for redundant employees terminated after five or more years was justified largely due to the loss of non-transferable credits, with the largest of these being long service leave which accrues at the rate of 13 weeks leave for 15 years’ service. 12 weeks of severance pay for 10 or more years of service was also fixed with regard to long service leave, with it being noted that under the standard long service leave provision in federal awards 10 or more years of service entitles an employee to pro rata payment of long service leave when terminated due to redundancy. The reduced severance pay for employees of 10 years or more was accordingly fixed to prevent double counting with regard to this provision.

1. In the matter before me, it is first appropriate to have regard to the fact that, somewhat unusually for redundancy cases, the CET took an extended time to both consider its employment needs as well as to ultimately determine Ms Johnson’s redundancy.  The College’s librarian information services review unambiguously stated to employees that one of the recommendations was that “all current library positions become redundant and the following new positions created: 1 Academic Research Leader and 2 Academic Research Centre Assistants”.[84] The IEU accepts that it and its members received the relevant executive summary of the report in December 2020, and Ms Johnson’s evidence was that she was told on 8 December 2020 that she would have to apply for the new positions.[85]  By 11 October 2021, when Ms Johnson was made redundant, Guilford Young College had been discussing a review of its library services for over a year with the potential for redundancies having been identified as a possibility for about 10 months of that period.

1. On 24 July 2020 the Principal, Mr Deighton, met with Ms Johnson, another employee, Ms Sandy von Allmen, and the IEU organiser, Jeremy Oliver, and advised them a review of the library service was to be undertaken, although no mention was made at that time of redundancies.[86]  In December 2021, the library staff and IEU were provided with a copy of a written review of library services. The review document identified that redundancies were likely.[87]

1. Also during December 2021, discussions took place between the College, the IEU, and the two affected staff, Ms Johnson and Ms von Allmen. The discussion included the possibility of the redeployment of Ms Johnson and the voluntary redundancy of Ms von Allmen. While Ms Johnson indicated her acceptance of the possibility of redeployment, this did not eventuate.[88]  Late in December 2020, the IEU notified a dispute to the Commission dealing with the question of whether a deed of settlement could be imposed as a condition of redundancy.

1. Germane to Ms Johnson’s interests, Mr Heyward notified her of a potential redundancy situation in January 2021.

1. The situation ambled on inconclusively during 2021.

1. Ms Johnson was allocated higher duties during the first part of 2021 which involved working as the College’s librarian at its Hobart campus. In May, an ARC leader was appointed but left within his first month of employment. Not long after. in July 2021, Mr Heyward advised Ms Johnson that CET’s consideration of her redundancy was progressing. Consistent with CET’s obligation under the Agreement, Ms Johnson was first offered voluntary redundancy.[89]  Ms Johnson engaged with the proposal through the IEU who responded to Mr Heyward with a counterproposal, again characterised as being for voluntary redundancy.[90] Mr Heyward took the counterproposal as being a rejection of CET’s position and thereby the end of consideration of a voluntary redundancy. That in turn led CET, through Mr Deighton, to advise Ms Johnson her employer was now considering “a potential redundancy situation”, that is, a forced or nonvoluntary redundancy.[91]

1. Further exchanges between the parties ensued, culminating in correspondence from Mr Heyward to Ms Johnson on 11 October 2021 confirming that her position of library technician at Guilford Young College would be redundant effective from 11 October 2021.[92]

1. At the time she was made redundant Ms Johnson says she lost two or three days of personal leave and would have had another 10 days credited to her by the time she submitted her witness statement in December 2021.[93] That relatively low level of personal leave accrual stands in contrast with the 28 day she had accumulated at June 2021. Ms Johnson attributes the reduction in personal leave credits to the stress she experienced associated with the notified redundancy as well as some carers’ leave for her children.[94] Her long service leave balance on termination was less than 3 weeks.[95] Consideration of annual leave loading is moot with the Agreement not providing for such an entitlement.

1. There is some but not much evidence before the Commission about the inconvenience and hardship associated with Ms Johnson’s redundancy. She has tried to gain employment elsewhere, including as a casual employee and for lower paid positions.  She now lacks confidence about job searching, and the experience has shaken her self-belief and professional confidence.[96] In these regards it is to be noted that being aged 61 at the time of the application, it may be considered that such inconvenience and hardship as may exist will be greater than the ordinary circumstances. Finding a new position in the education sector in Tasmania may well be a challenge for Ms Johnson given that it has been over 18 years since she was required to engage with the employment market and that she is well above the age at which some employers at least are prepared to consider new employees.

Length of service, seniority, and loss of security

1. Ms Johnson’s length of service is in and of itself a matter that requires consideration.  While the Redundancy Case noted that considerable service with an employer was rewarded through entitlements to long service leave, it should also be considered that 18 years’ service is well beyond the norm. There should not be an incentive to end the employment of very long serving employees, but, on the other hand, there should not be inflexibilities introduced such that would prevent employers from responding to legitimate market demands.

1. Ms Johnson seniority of employment at the time she was made redundant was not great.  While there had been a period in 2021 where she acted as librarian at the Guilford Young College’s Hobart campus, the context of those higher duties would indicate that this was at best a minor acting-up opportunity which demonstrably did not go for long.

1. Nevertheless, in moving to other employment it may be predicted that it may take some time for Ms Johnson to develop the necessary seniority in order to be offered further higher duties. This would be a predictable consequence of a new employer treating her as the most junior of its employees and then taking some time before it recognised her experience in service for the purposes of offering higher duties. She would not be a team leader moving to another team leader position, but a general team member moving to another such position.

1. Ms Johnson’s age and length of tenure with CET, as well as what may be expected to be a somewhat tight employment market for the specialist skills she holds, are pertinent to considerations of loss of security for future employment.  It may be expected in that regard that new employment, once achieved, may be somewhat tentative, and perhaps even on the basis of casual or contract appointment.

1. This factor of loss of security, as well as the matter of loss of seniority, steer towards a higher than standard severance pay. On the other hand, it is not the role of severance payment to stand as a crystallisation of the economic loss that may be perceived in these regards.  Instead, the severance payment stands as a payment which allows the transition of an employee from one period of employment to another.

Long service leave

1. In relation to long service leave, Ms Johnson gave evidence that at the time of her redundancy she was paid out an accrual of 2.4 weeks long service leave, and that over 18 years of continuous service with CET she had accrued 23.4 weeks of long service leave and had taken leave equal to 20 weeks. The consideration of long service leave in respect of the setting the severance payment amount is potentially twofold; the loss of a further accrual with CET which because of the redundancy will never crystallise, as well as the fact that upon commencement of employment with a new employer it may be expected that it will be a full seven years of continuous service before any accrual crystallises and is available to the employee. Some account needs to be taken of long service leave in setting an amount of severance pay for Ms Johnson. Demonstrably she had passed all relevant thresholds and was accruing long service leave annually. In moving to a new employer, it would indeed be the case that Ms Johnson would need to serve some years before any further accruals could be available to her; however, on the other hand, at 61 years of age it may well be the case that such a period is never actually achieved, with her retiring from the workforce before the new pro rata accrual threshold is reached.

Industry comparators

1. The IEU made numerous submissions about the antecedents to the current Agreement as well is what may be expected of a Tasmanian public sector employer in the event that they made an employee such as Ms Johnson redundant. I do not place reliance upon this material.  The material within Mr Oliver’s statements is most significantly in relation to the 2014 bargaining, whereas the Agreement under consideration in this decision operated from 6 May 2019.  In the case of the antecedents to the current Agreement the material which is within Mr Oliver’s witness statement does not rise to the level of being admissible extrinsic evidence in the construction of this Agreement. I also do not place any reliance upon the assertions made about the redundancy benefits available to employees in the Tasmanian public sector. The relevant material is not formally before me and, in any event, it is unknown to me as to whether the asserted benefit came about as a result of agreement or arbitration.

The parties’ negotiations

1. The material before me also includes proposals made to Ms Johnson at various stages of the CET’s consideration of her redundancy, and especially at the point a voluntary redundancy was being considered. This includes both proposals from the CET to Ms Johnson as well as from her union to the CET. I do not place any reliance upon that material and do not find the material to be something that should be taken into account by me in my determination of a suitable severance payment to be made to Ms Johnson. The proposals are in the context of what the offeror at the particular time was prepared to put forward, with the high point of the proposals being that none of them were accepted.

Conclusions on a suitable amount of severance pay

1. As previously indicated  CET, the Applicant in this matter, proposes that the appropriate severance payment to Ms Johnson be 12 weeks, whereas the IEU puts forward that it should instead be 50 weeks.[97]

1. The former proposal represents a payment of roughly 2/3 of one week’s pay for each year of service and the latter of about 2.7 weeks’ pay for each year of service.  Neither proposal is satisfactory.

1. I do not accept the IEU proposition that the reason the Agreement states the amount of severance pay cannot be less than the NES amount was solely to ensure Commission approval of the Agreement, and that there is no basis to read the term to mean that the NES is payable “unless there are particular facts justifying a higher amount”. There is no warrant to read the term, such as it is, as meaning that a redundant employee will always be paid more in severance pay than the NES. If that was the parties’ intention, it is not consistent with the ordinary meaning of the words they used to settle their agreement.

1. It follows there will be some cases of redundancy where a redundant employee is paid only the employee’s entitlement under the NES.

1. For several reasons, Ms Johnson is not one of them.

1. While criticisms are advanced by the IEU about the process used by CET to determine Ms Johnson’s position, this cannot be said to be a case in which the employer rushed into making her position redundant, thereby depriving her of the opportunity to seek other employment, retraining, or redeployment. Such criticisms as may be laid against the lengthy process employed by CET are answered by the fact that the period in effect worked as recognition both of her length of service and age. The fact there was 10 months between the first mooting of redundancy and its actuality means that an adjustment to severance pay is not required for these factors.  The extended period of notification of possible redundancy is a factor which in this case pulls a severance pay award in the direction of the NES. That the parties did not reach agreement on either redeployment or voluntary redundancy is an indicator only that each decided to chance their hand and does not mean the time they took to finalise a forced redundancy would cause the Commission to look away from the fact that Ms Johnson had 10 months to assimilate her position, identify her alternatives and even to farewell close work colleagues. Rarely do redundant employees have 10 months to sort these things through.

1. It follows I consider there is no need to make an adjustment to the severance pay scale in relation to matters of trauma associated with the loss of Ms Johnson’s job. I accept she was distressed to be dismissed after so long working for the one school, and especially one that has so many worksites and employees. Even so, those matters are comprehended sufficiently within the standard severance pay scale.

1. On the one hand, the CET proposal takes no account of the special circumstances of Ms Johnson set out in detail above. It also fails to grapple with the fact of the Agreement term which sets the NES provisions as a floor from which a negotiation may proceed. There are no circumstances that I can see within Ms Johnson’s situation or that of the Guilford Young College that would cause me to say that only the floor should be considered. The CET proposal is therefore unsatisfactorily harsh.

1. The CET position also takes no or inadequate account of the fact that the Agreement distinguishes, albeit insufficiently so, between the circumstance of a voluntary redundancy and any other redundancy. While it is hardly novel that a large employer would say to employee that a sweeter deal may be achieved through the happy coincidence of a voluntary redundancy, it would on the other hand be unacceptable to turn the rejection of a voluntary redundancy proposal into a punitive affair. A lesser benefit may be proposed for a forced redundancy than a voluntary one. However, it does not follow, and it would be unfair to do so, to take the view that a person who rejects an offer for voluntary redundancy should fall immediately to the floor of the NES.

1. In contrast though, the IEU proposal would in effect put golden handcuffs around any long serving employee being considered for redundancy. The general principles for determination of severance pay do not lead to the conclusion it seeks on behalf of Ms Johnson.  Whereas a particular employer may bargain with its employees that redundancies will be avoided at all costs, and through the inclusion of a severance pay scale which makes it uneconomic, there is no admissible evidence in these proceedings that CET intended such to be the result.

1. If Ms Johnson was to be paid in accordance with the NES scale her severance payment entitlement would be 12 weeks.

1. That amount inadequately reflects her length of service, seniority, and loss of security.  Ms Johnson will find it difficult to obtain comparable employment in the future. The fact that she worked for a very large Tasmanian employer in a specialist field is also a factor of importance. Likely there will be few other employers offering the type of work she performed or its level of security. Those factors combined justify the severance payment being increased, and considerably so.

1. Matters associated with the loss of non-transferable credits require a minor adjustment to the level of severance pay, however only for the purposes of long service leave and not personal leave.

1. The evidence suggests Ms Johnson’s personal leave accrual was not large for someone of her length of employment, even in June 2021, and that what was there was used somewhat rapidly before October 2021. Whether or not she was made compulsorily redundant in late 2021, continued working where she was, or was redeployed, her personal leave credits at the end of 2021 would have been minimal (with 10 days to be credited to her at the end of 2021) and would need to be rebuilt. Commencing work at a new employer would likely have required personal leave to accrue progressively during the first year, however, overall, and irrespective of her employer, the personal leave balance available to Ms Johnson after the end of 2021 was always going to be modest. As such, an adjustment of severance pay for the loss of her personal leave credits is not required in this case. Such loss as she incurred may be characterised as being within the normal range and encompassed within the minimum NES severance pay scale.

1. While Ms Johnson has been paid out her accrued long service leave, she will not be eligible for further long service leave credits for some years. By way of example, the Long Service Leave Act 1976 (Tas) (should that be the applicable instrument) provides that leave is available after 10 years continuous service, and a pro-rata payment after 7 years in certain cases of termination (see s.8). An employee at Ms Johnson’s age, length of service prior to redundancy, and with a low actual accrual, may be predicted to be someone who will acutely notice the absence of future credits. This factor warrants an increase in the amount of severance pay.

1. I am not persuaded that industry comparisons require an adjustment to Ms Johnson’s severance pay. The evidence on the subject is limited and does not demonstrate to a satisfactory level that the parties’ mutual intention as expressed in the Agreement was to import to their own relationship the practices of other employers. Likewise, I am not satisfied that the negotiations for either redeployment or voluntary redundancy dictate an adjustment to Ms Johnson’s severance pay. Each party has their reason for initially entertaining the relevant proposal, and each has their reasons for not concluding an agreement. It would not be in the interests of either to penalise one side (whichever it is) simply because the negotiations did not result in agreement.

1. There is no precise science to the matter of setting an appropriate level of severance pay, as would be discerned from the precedent cases to which I have referred. For what it is worth, the quantum now set by me would be at or close to the NES scale if Ms Johnson’s service was at or around 10 years and she was much younger. It may be presumed I consider her actual age and length of service to warrant a significantly higher payment than the standard. The loss of future long service leave credits pulls the amount awarded higher, but only by a relatively small amount. It may also be presumed that the quantum to be awarded would be higher still if there was no real notice given of impending redundancy with the age, length of service and security of employment factors being present as they are.

1. After consideration of all relevant factors, it is appropriate to determine the level of Ms Johnson’s severance pay as 1 ½ weeks per year of completed service; that is a total of 27 weeks’ pay, noting that she has already been paid the amount of 12 weeks’ severance pay by CET, and that as such she should be paid a further 15 weeks’ pay.

1. The dispute is determined accordingly.

COMMISSIONER

Appearances:

Ms S Masters for the Applicant

Mr D. Matson for the Respondent

Hearing details:

Melbourne (via video conference);
18 January;
2022.

ATTACHMENT

31 REDUNDANCY

31.1 Potential Redundancy Situation

A potential redundancy situation exists where any Employee could be disadvantaged in his or her current employment contract as a result of changes in funding, curriculum, enrolment, arrangement of work, or policy/administration changes.

31.2 Objectives

The objectives of these Procedures and Guidelines, in order are to:

• Avoid redundancies in Catholic schools in Tasmania;
• Delay redundancies where this is not possible;
• Facilitate those declared redundant to find other suitable employment within Catholic education, so that they do not suffer financially as a result of being declared redundant;
• Ensure a consistent and fair approach to be applied to all in Catholic education;
• Ensure that that these procedures be applied as early as possible; and
• Ensure that there is appropriate notice and consultation.

31.3 Timelines

The timelines are vital and the parties are committed to providing as much information as possible as early as possible. If a redundancy(ies) is expected to take effect from the beginning of a school year, and the information upon which a potential redundancy is identified is available early in the year the process must commence as early as possible in Term 3 and any redundancies be determined by early in Term 4.

31.4 Procedures

Step 1 - The Redundancy Identification and Investigating Ways of Avoiding Redundancy

a)As soon as a potential redundancy situation is identified, the Employer/Principal shall communicate this fact in writing to each member of staff in the classification(s) of Employees affected, with an outline of the reasons for the potential redundancy(ies) (see Attachment 1}. A copy must be placed on the staff notice board.

b)The notification must attach an information pro forma (see Attachment 2) with the information completed.

c)A copy of this notification shall be forwarded at the same time to the Executive Director of Catholic Education Tasmania and the Union.

d)A copy of these procedures must then be given to each staff member.

e)The Employer/Principal must start to investigate alternatives including:

• What efforts can be made to re-deploy existing staff within the school;
• Staffing requirements in all other schools under the authority of the present Employer;
• The possibilities of employment of staff in neighbouring schools;
• Any additional funding that may be available e.g. additional government funding, parish support;
• Measures to overcome short-term overstaffing;
• Retraining possibilities;
• Possible leave arrangements, e.g. Leave Without Pay, Long Service Leave, Parental Leave;
• Applications by staff indicating that they are willing to make a voluntary offer to be declared redundant.

f)While the Employer must offer voluntary redundancy(ies) at this step, the Employer is not obliged to accept any particular expression of interest in a voluntary redundancy.

Step 2-The Redundancy Document

If the potential redundancy is not solved, the Employer will send either:

a)A notification that the situation has been resolved by the taking of a voluntary redundancy(ies) and/or 'leave without pay'; or

b)A redundancy document to all the parties mentioned above. The redundancy document must include the following information:

• The Reasons for the potential redundancy(ies) including any relevant information such as funding, staffing, curriculum change and enrolments (past, present and projected);
• The Number and Categories of Staff likely to be affected and details of their employment;
• Alternatives Investigated in Step 1; and
• The steps the Employer proposes to implement the redundancy(ies)

Step 3 -The Redundancy Meeting

a)A meeting will be held between the IEU and the Employer to consider the Employer's/Principal's redundancy proposal. The parties will seek to agree on the criteria to be applied and the content of the redundancy document.

b)If agreement is reached on both matters, the Employer/Principal shall indicate to the persons at the meeting the name/s of the person/s to be declared redundant. The person/s so named shall be informed within a week of the meeting by the Employer/Principal.

c)If agreement is not reached, a second meeting will be held to attempt to resolve the disagreement. If agreement still cannot be reached the Employer shall inform the IEU of the action that the Employer intends to take.

d)In deciding who is to be declared redundant, the parties must consider

• the needs of the school;
• the work currently being performed which will no longer need to be performed; and
• those staff who could not be replaced by any member of the existing staff, having regard to the programs planned for the period after the redundancy.

e)The Employer/Principal will identify the factors (from those below) which have been considered in determining the staff member(s) to be declared redundant and inform the meeting of any priority that has been applied to these factors:

• Current Contract of Employment
• Current Duties
• Curriculum Programs
• Experience
• Funding Base for Staff Member
• Graduate Status
• Length of Service
• Pastoral Considerations
• Previous Redundancy History
• Qualifications
• Specialist Expertise
• Staff member's willingness to make a voluntary offer to be declared
• redundant.

f)Factors which cannot be used include whether the person is a Union Representative or member, the person's sex, marital status, age, pregnancy, lifestyle or religion.

Step 4- Notifying the Redundancy Result

a)Within two weeks of the meeting(s) in Step 3, the Employer must notify the IEU in writing of the details of the Employer's action following Step 3.

b)The Employer must provide a letter to each person proposed to be made redundant which must afford the Employee an opportunity to provide any reasons why they believe that his/her employment should not be terminated. The letter shall outline the forms of assistance available to them and, where possible, offer the option of Leave Without Pay for the following school year (or such other period as is possible).

c)Should an Employee provide a reason why his/her employment should not be terminated as a consequence of redundancy, which is acceptable to the Employer, then the process should revert to Step 3;

d)Should an Employee elect to take up an offer of Leave Without Pay:

• The date of termination will be deferred accordingly;
• The Employee shall be entitled to apply for and then be given absolute preference for any position which becomes available in the school during the period of leave, for which the Employee has appropriate skills and qualifications; and
• If redundancy is not avoided, the Employer will confirm the termination not less than one month prior to the date of effect.

e)The Employer must provide a letter to the IEU which advises of the ultimate outcome of the matter.

Step 5 - Assistance in Re-Employment

The Employer must offer at least the following assistance to any person declared redundant:

a)Assistance with locating openings and securing employment in other Catholic schools;

b)Regular meetings with the staff member/s to discuss pastoral and professional issues; and

c)Time release to the staff member/s declared redundant to attend interviews.

31.5 Severance Pay

Severance payment in the case of redundancy shall be an amount agreed between the Employer and the Employee(s) who may be represented by the Union in negotiations. In the event of no agreement being reached, the matter may be resolved pursuant to the Dispute Settling Procedure in this Agreement. The amount payable shall not be less than the entitlement under the National Employment Standards.

[1] Covering Email Attaching F10, Hearing Book 77.

[2] Ibid.

[3] Exhibit R2, Hearing Book 114.

[4] Ibid.

[5] Exhibit R2, Hearing Book 112.

[6] Exhibit R2, Hearing Book 112.

[7] Ibid.

[8] Exhibit R2, Hearing Book 117.

[9] Ibid.

[10] Exhibit R2, Hearing Book 115.

[11] Exhibit R2, Hearing Book 116.

[12] Exhibit R2, Hearing Book 116-117.

[13] Exhibit R2, Hearing Book 117.

[14] Exhibit R1, Attachment 16, Hearing Book 191.

[15] Exhibit A1, Hearing Book 39.

[16] Ibid; Exhibit A2, Hearing Book 75.

[17] Note that the nomenclature “forced redundancy” and “compulsory redundancy” are used interchangeably throughout this decision

[18] Ibid.

[19] Exhibit A4, Hearing Book 34; Exhibit A1, Hearing Book 41.

[20] Exhibit A2, Hearing Book 75; Exhibit R2, Hearing Book 114.

[21] Exhibit A2, Hearing Book 75;

[22] Exhibit R2, Hearing Book 114.

[23] Exhibit A2, Hearing Book 76;

[24] Exhibit R2, Hearing Book 114 – 115.

[25] Exhibit R2, Hearing Book 114, 115.

[26] Exhibit A2, Hearing Book 76.

[27] Exhibit R2, Hearing Book 114, 115.

[28] Exhibit R2, Hearing Book 115.

[29] Exhibit A1, Hearing Book 41; Exhibit R2, Hearing Book 113 – 115.

[30] Exhibit A1, Hearing Book 54.

[31] Exhibit A4, Hearing Book 35.

[32] Ibid.

[33] Ibid.

[34] Exhibit A4 [3], Hearing Book 29.

[35] Exhibit A4, [9] – [10], [30], Hearing Book 30-31, 37.

[36] [2004] AIRC 287; 129 IR 155.

[37] [2021] FWCFB 6027.

[38] Exhibit A4 [16], Hearing Book 32.

[39] Exhibit A4 [23] – [24], Hearing Book 35-36.

[40] Ibid.

[41] Exhibit A4 [30], Hearing Book 37.

[42] Ibid, [28].

[43] Exhibit R3 [7] – [8], Hearing Book 100.

[44] Exhibit R3 [9], Hearing Book 100 – 101.

[45] Exhibit R3 [10], Hearing Book 101.

[46] Ibid.

[47] Ibid.

[48] Exhibit R3 [11] – [13], Hearing Book 101.

[49] Exhibit R3 [15], Hearing Book 102.

[50] Exhibit R3 [19], Hearing Book 102; “VCEMEA” is a reference to the Victorian Catholic Education Multi-Employer

Agreement.

[51] Exhibit R3 [20], Hearing Book 102 – 103.

[52] Exhibit R3 [22], Hearing Book 103.

[53] Exhibit R3 [21], Hearing Book 103.

[54] 1 September 2021.

[55] Exhibit R3 [26] – [32], Hearing Book 103 – 104.

[56] Exhibit R3 [34], Hearing Book 104 – 106

[57] Exhibit R3 [34](5), Hearing Book 105.

[58] Ibid.

[59] Ibid.

[60] Exhibit R3 [34](7), Hearing Book 106.

[61] (1984) 8 IR 34.

[62] Exhibit R3 [37], Hearing Book 106.

[63] Exhibit R3 [39], Hearing Book 107.

[64] Exhibit R3 [40], Hearing Book 107.

[65] Exhibit R3 [45], Hearing Book 107 – 108.

[66] Exhibit R3 [48], Hearing Book 108.

[67] Exhibit R3 [49], Hearing Book 108.

[68] Exhibit R3 [51] – [53], Hearing Book 108 – 109.

[69] Exhibit R3 [54] – [60], Hearing Book 109 – 111.

[70] Exhibit R3 [61], Hearing Book 111.

[71] [2021] FWCFB 6027, [26].

[72] [2004] AIRC 287; 129 IR 155.

[73] Ibid [134].

[74] [2004] AIRC 287; 129 IR 155, [4].

[75] Ibid [39].

[76] Ibid [137].

[77] Ibid,

[78] Ibid [138] – [139].

[79] Ibid [138].

[80] Ibid [139].

[81] Ibid [140].

[82] Ibid [142].

[83] Ibid [153].

[84] Exhibit R1, Attachment 16, Hearing Book 193.

[85] Exhibit R1, [29], Hearing Book 122; Exhibit R2, [10], Hearing Book 113.

[86] Exhibit R1 [27], Hearing Book 123.

[87] Exhibit R1 [28], Hearing Book 123.

[88] Additional Document 2; Hearing Book 218.

[89] Exhibit R1, Attachment 18, Hearing Book 195.

[90] Ibid, Attachment 20, Hearing Book 205.

[91] Ibid, Attachment 21, Hearing Book 207.

[92] Ibid, Attachment 22, Hearing Book 209.

[93] Exhibit R2, [41], Hearing Book 117.

[94] Ibid, [42], Hearing Book 117.

[95] Exhibit R3 [59], Hearing Book 111.

[96] Exhibit R2, [30] – [32].

[97] Exhibit R3, [

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