The Trustee for Tapco Unit Trust T/A Followmont Transport Pty Ltd v Mr Shannon Reeves
[2016] FWC 6280
•2 SEPTEMBER 2016
| [2016] FWC 6280 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.120 - Application to vary redundancy pay for other employment or incapacity to pay
The Trustee for TAPCO UNIT TRUST T/A Followmont Transport Pty Ltd
v
Mr Shannon Reeves
(C2016/4771)
COMMISSIONER SPENCER | BRISBANE, 2 SEPTEMBER 2016 |
Variation of redundancy pay.
[1] This Decision relates to an application made under s.120 of the Fair Work Act 2009 (Cth) (the Act) for a variation to redundancy pay. The application has been made by The Trustee for TAPCO UNIT TRUST T/A Followmont Transport Pty Ltd (the Applicant).
[2] The Applicant has applied to the Fair Work Commission (the Commission) seeking to have the redundancy entitlement of Mr Shannon Reeves (the Respondent) reduced to nil. In the Application to Vary Redundancy Pay submitted by the Applicant it stated that the Respondent is entitled to 12 weeks redundancy pay. However, in the Statutory Declaration of Ms Alice Atkins, for the Applicant, she stated that the Respondent is entitled to 13 weeks redundancy pay. According to the National Employment Standards under the Act, the Respondent is entitled to 13 weeks redundancy pay for 7 years and 6 months of service with the Applicant. The Applicant subsequently agrees that this would be the Respondent’s entitlement but for the alternative employment offer.
[3] The Applicant has made this application pursuant to s.120(1)(b)(i) of the Act, on the basis that the Applicant submitted that it had obtained other acceptable employment for the Respondent. The Respondent did not accept the Applicant’s offer of an alternative role which has remunerated at a higher rate of pay, of similar working hours, and located at the same premises as the Respondent’s previous position at the Applicant’s Brisbane Branch, as a Full Time AM Forklift Operator. At the time the Respondent was made redundant, he was working as a Full Time Storeperson, and had been performing this role on a Full Time basis since 15 January 2009. Prior to this, the Respondent had been employed on a casual basis in the position of Storeperson with the Applicant since 9 November 2004.
[4] The Commission issued Directions on 5 August 2015 for the filing of materials. In response, the Applicant stated he was content to have the matter determined on the papers. The Respondent has also indicated that he is content to have the matter determined on papers.
Background
[5] The Applicant operates a transport company which specialises in the delivery of magazines, as well as general freight by road transport. The Respondent has been employed since 15 January 2009 as a full-time Storeperson at the Brisbane Branch.
[6] On 13 June 2016, the Applicant’s management sent a letter to all staff in the Packing and Distribution Department (the Department) of Followmont Transport, notifying that there was “some uncertainty around the continuation and level of work anticipated” within the Department. This uncertainly was attributed to “external factors, predominately as a result of the decline of print media industry, as well as internal business changes occurring with publishers and distributors”. The packing side of the Department was directly affected as a result of the abovementioned, in that the demand for Followmount Transport to pack magazines had declined, and it was anticipated that such a decline would continue. The Applicant determined that the decline in its services, would result in a substantial reduction in revenue, therefore it would be implementing some compulsory re-deployments, and where such was not possible, redundancies would follow.
[7] It was submitted in the Statutory Declaration of Ms. Alice Atkins, Executive Manager of People and Culture of Followmont Transport, for the Applicant, that from the onset of consultation with all staff in the Department, including the Respondent, that the Applicant communicated to all staff in the Department that if acceptable employment was found for them, they would not be entitle to a redundancy payment. At a consultation meeting that occurred on 28 June 2016, all staff in attendance, including the Respondent received a ‘Frequently Asked Questions’ Sheet which the Applicant submitted outlined this, in writing.
[8] The Applicant, in a letter to the Respondent dated 4 July 2016, formally advised the Respondent, that upon undertaking a thorough review of the operational requirements of the Department, Followmont Transport had identified the Respondent’s position as no longer being required within the Department. By letter, the Applicant instructed the Respondent to attend a meeting on 6 July 2016, where he would be advised of his employment status and of any alternative employment opportunities within Followmont Transport.
[9] The Respondent made a request on 5 July 2016 to attend the meeting via telephone, citing personal circumstance, for the request. A telephone meeting was held on 5 July 2016 between the Respondent and a People and Culture Advisor from Followmont Transport, where the Respondent was advised that the Applicant was able to redeploy him to the position of AM Forklift Operator. Subsequently, a Letter of Advice on Redeployment dated 5 July 2016 was sent to the Respondent, confirming what had been discussed in the telephone meeting, along with accompanying documentation surrounding the position description, remuneration and working hours of the of AM Forklift Operator position.
[10] The Respondent stated that as a result of the decline in the demand for the services of the Department within Followmont Transport, twelve full time positions were made redundant, including that of Respondent. Of these redundancies, the Applicant was able to offer redeployment positions to four of the twelve employees. The Applicant submitted that it has secured “acceptable alternative employment” for the Respondent, in the position of Full Time AM Forklift Operator at its Brisbane Branch.
Relevant legislation and award clauses
[11] The National Employment Standards (NES) prescribe the minimum entitlements to redundancy pay pursuant to s.119 of the Act:
119 Redundancy pay
Entitlement to redundancy pay
(1) An employee is entitled to be paid redundancy pay by the employer if the employee’s employment is terminated:
(a) at the employer’s initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or
(b) because of the insolvency or bankruptcy of the employer.
Note: Sections 121, 122 and 123 describe situations in which the employee does not have this entitlement.
Amount of redundancy pay
(2) The amount of the redundancy pay equals the total amount payable to the employee for the redundancy pay period worked out using the following table at the employee’s base rate of pay for his or her ordinary hours of work:
Redundancy pay period | ||
Employee’s period of continuous service with the employer on termination | Redundancy pay period | |
1 | At least 1 year but less than 2 years | 4 weeks |
2 | At least 2 years but less than 3 years | 6 weeks |
3 | At least 3 years but less than 4 years | 7 weeks |
4 | At least 4 years but less than 5 years | 8 weeks |
5 | At least 5 years but less than 6 years | 10 weeks |
6 | At least 6 years but less than 7 years | 11 weeks |
7 | At least 7 years but less than 8 years | 13 weeks |
8 | At least 8 years but less than 9 years | 14 weeks |
9 | At least 9 years but less than 10 years | 16 weeks |
10 | At least 10 years | 12 weeks |
[12] The application has been made pursuant to s.120(1)(b)(i) of the Act which provides:
120 Variation of redundancy pay for other employment or incapacity to pay
(1) This section applies if:
(a) an employee is entitled to be paid an amount of redundancy pay by the employer because of section 119; and
(b) the employer:
(i) obtains other acceptable employment for the employee…
(2) On application by the employer, the FWC may determine that the amount of redundancy pay is reduced to a specified amount (which may be nil) that the FWC considers appropriate.
(3) The amount of redundancy pay to which the employee is entitled under section 119 is the reduced amount specified in the determination.
Whilst it is acknowledged that information has been provided in the application, both parties are required to address in detail the following:
[13] The following was set out in Directions:
“Whilst it is acknowledged that information has been provided in the application, both parties are required to address in detail the following:
● whether the Applicant was entitled to be paid redundancy pay, in accordance with s.119 of the Act;
● the remuneration and conditions of the alternative employment found, including also its location, hours of employment and duties (in comparison to the former position);
● whether the alternative employment was obtained by the Employer; and
● whether the alternative employment was or was not, acceptable, and why.”
Summary of Applicant’s Submissions
[14] The Applicant submitted that it had obtained acceptable employment for the Respondent in the form of the Full Time AM Forklift Operator at the same location as the Respondents prior role; namely the warehouse of the Brisbane Branch of Followmont Transport.
[15] The application submitted that the ordinary hourly rate of pay for the redeployment role is $21.00 per hour, which is a higher hourly rate than the Respondents previous role, which was $20.34.
[16] The terms and conditions surrounding the redeployment offer are contained in a Letter of Advice dated 5 July 2016, where the Applicant expressly stated that the “redeployment role is equivalent in remuneration, ordinary working hours and location” to that of the Respondent’s current position of Storeperson. The Letter of Advice contains as follows:
- Mr Reeves will be based at the Brisbane Branch as a Full Time AM Forklift Operator;
- Mr Reeves will be paid in accordance with the Road Transport and Distribution Award at an ordinary houly rate of $20.60 per hour + 9.5% Superannuation;
- Mr Reeves ordinary hours of work will be an average of 38 hours per week to be worked in a flexible manner to suit operational requirements.
[17] A Letter of Confirmation of Position at Followmont Transport Pty Ltd was sent to the Respondent on 29 July 2016. The letter outlined to the Respondent that the redeployment role was compulsory, equivalent in remuneration, ordinary working hours and location to the Respondent’s current role. The letter further sought a response from the Respondent as to whether he was going to take up the redeployment positions, as he was yet to inform the Applicant of his intention. The letter confirmed to the Respondent, that if he did not accept the role the Applicant was unable to offer him any other position, and that he would not be entitled to redundancy pay as the Applicant had “offered a suitable and reasonable redeployment offer which meets the requirements of “acceptable employment” under Division 11 of the Fair Work Act”. The Respondent was given until close of business 2 August 2016, to notify the Applicant of his intention, and if he did not provide such a response, then his employment with Fellowmont Transport Pty Ltd would be terminated, effective 3 August 2016.
[18] The Respondent has not accepted the new redeployment position offered to him. Subsequently, his employment with the Applicant ceased on 5 August 2016 as a consequence of his position as Storeperson being made redundant with Followmont Transport Pty Ltd, and the Respondent not accepting redeployment into the position of AM Forklift Operator.
.
[19] The Respondent has cited the following reasons to the Applicant for declining to accept the redeployment position:
- The Respondent believed he was entitled to redundancy pay regardless of any offer of acceptable reemployment;
- The Respondent did not believe that the redeployment offer was the “same pay”; and
- Because of his “life circumstance”.
[20] The Applicant submitted that the Respondent’s position as Storeperson involved working in a warehouse environment, where his basic duties were Bulk sorting, Pre Pack sorting, Palletising, Counting in Stock and some Forklift work. The Applicant argued that the redeployment position of AM Forklift Operator offered to the Respondent, involved similar warehouse duties as his previous role. The position of AM Forklift Operator also involved the unloading of all incoming line haul trailers, loading local delivery vehicles, keeping all empty Chep, Loscams and Plain pallets in their respective bays and unloading customer freight in breezeway, and placing in designated bays.
[21] The Applicant identified one main difference between the Respondent’s position as Storeperson, and that of the new redeployment position; that being the redeployment position involved more frequent use of a forklift. The Applicant submitted that according to its employee records, the Respondent possesses a valid forklift licence and has used his licence in his previous position when it has been required.
[22] In the Statutory Declaration of Ms Alice Atkins, it was submitted that she was aware of only one appreciable difference between the Respondents previous position as Storeperson and the redeployment position; being with rate of pay between the positions. In the Respondent’s position that was made redundant, on an ad hoc basis, there was weekend overtime work available for the Respondent where there were applicable award penalty rates available. Ms Atkins submitted that the redeployment position may not have the same amount of weekend overtime available to the Respondent, at least in the short term.
[23] Ms Atkins submitted that she believed that the redeployment position offered to the Respondent amounts to acceptable employment, even though it is probable that the position offers less irregular weekend overtime, than the Respondent’s position, that was made redundant.
Summary of Respondent’s Submissions
The Respondent provided the following email in response to the Applicant effect of redeployment:
“On tuesday the 5th of july at the time of the redandancy i was not at work due to my wife having pregnancy problems with our 2nd child. and as my wife was stuck in hospital for a period of time with our new born child as he was 9 weeks premature. due to family reasons i was unable to take the new job offer at the time that it was offered to me by followmont transport as i found it was a decrease in pay. but was open to other area's within the company as which there was none as stated by alice atkins.as i worked tuesday to saturday. where on saturday i worked as a team leader to run the 5am till 1.06pm shift where i was on penalty rates for that day so therefore it would be a great loss going back to a monday to friday shift with no penalty rates no more and would of been a loss of about $150.00 per week from my saturday shift that i think followmont dont understand which i can not afford to take and the morning penalty rate of 42.00 dollers for 5am starts that was on my roster for thusday and friday.on monday the 25th of july 2016 alice atkins called me on my decision and at the time was not in the right frame of mind to make a decsion as my wife and new born son was still in the specail care unit at the RBWH but i was getting pushed into one by alice atkins stating that if i did not take the new job offer it would be filled. but on that previous meeting held by me and alice atkins on wednesday the 6th of july 2016 she stated that if i signed the new job offer it would remain open to me for when i am ready to come back to work.and would be ok to take 3 months unpaid leave due to my life circumstances with my wife not able to lift because of a emergency c section.but as i could not afford to do that as i have a car loan and another personal loans and with rent and with my oldest son at home still not at school i would of had to put him in daycare for the day where i would of worked every week just to cover his daycare fees on my own basic wage just could not live on that and is not viable at all. i asked to be let go on compassionate grounds due to my life cicumstances and that others where paid out and let go. but i was told no by alice atkins. as i did not have a choice but to put my family first as everyone would do in the same circumstances to get my family better and get them home. yours sincerly shannon reeves”
[24] The Respondent submitted that he did not take up the redeployment position with the Applicant because the position would not be of comparable remuneration to his previous position. The Respondent stated that he communicated this to Ms Atkins that he was open to redeployment in other areas within Followmont Travel, but was told that there were no other positions available. The Respondent stated that the redeployment position would have an approximate loss of income of $150.00 per week, as he would no longer be entitled to the same penalty rates as his previous position. The Respondent submitted that in his position as Storeperson he worked from Tuesday to Saturday. The Respondent stated that he would have received penalty rates for starting at 5:00am on Thursday and Friday mornings as well as on Saturday, as he acted in the position of Team Leader from 5:00am to 1:06pm.
[25] The Respondent also submitted that he was unable to take the redeployment position due to his ‘life circumstances’, as his wife had given birth to their second child prematurely and he had to put his ‘family first’.
[26] The Respondent submitted that he received a telephone call from Ms Alice Atkins, who stated that if the Respondent did not take the redeployment position it would be filled. The Respondent stated that he felt pressure from Ms Atkins, to make a decision on whether, he was going to take the redeployment position. The Respondent stated that he ‘was not in the right frame of mind to make a decision’ at the time, due to his wife and child still being in the special care unit at the RBWH. The Respondent stated that during a meeting with Ms Atkins 6 July 2016, she told the Respondent that if he signed the new job offer, the offer would remain open to him until he was ready to come back to work, and that he was able to take 3 months unpaid leave to care for his family.
[27] The Respondent submitted that it was not a viable option for him to take 3 months unpaid leave from the Applicant as this would cause significant financial stress to him, because he has a car loan, personal loan, rent that he has to make payments on. The Respondent also stated that if he was to take up the redeployment position, he would need to put his eldest child in childcare for the days that he worked, and his wage at Followmont would just be enough to cover this cost.
[28] The Responded submitted that he asked the Applicant to let him go on ‘compassionate grounds’, and believed that he was entitled to received full redundancy pay because other employees had been paid out and let go.
Summary of Applicant’s material in reply
[29] In response to the Respondent’s email of 22 August 2016, the Applicant stated the following:
“Followmont Transport Pty Ltd was aware that the Respondent had been absent from work since 28 June 2016, due to his wife being in hospital. Ms Alice Atkins discussed and corresponded with the Respondent on several occasions over a period of three weeks with regard to options, given his family circumstances. This communication occurred over the period 6th July 2016 (when Ms Atkins verbally advised the Respondent that he would be redeployed) to 29th July 2016.
The Respondent asked for, and was given, an opportunity to speak to Mr Mark Tobin, the Director of Followmont Transport, with regard to the Respondent’s view that he should be paid out redundancy pay and notice, rather than be retained in employment and redeployed to another position.
The Respondent’s arguments were at that time, and still are, as per his email of 22 August 2016, that Followmont should agree to pay out redundancy pay and notice, on “compassionate grounds” as his family needed the pay-out; he needed a job with more money and he was unable to work at that time.
Followmont Transport would have been prepared to hold the new position open for a period of time for the Respondent, given his family circumstances. However as the Respondent states himself in his email of 22 August 2016, he repeatedly stated that he did not want this, as he had a car loan and bills to pay. The Respondent’s expressed view was that a redundancy pay-out was a preferable way of financing these personal commitments, rather than staying in gainful employment with Followmont.
With regard to the Respondent’s comment relating the cost of childcare to his wage, the Applicant submits that this is not a relevant consideration as to whether the position that the Respondent was redeployed to, was acceptable employment. The Respondent’s need for childcare did not arise from any change in the redeployment job that was offered to him, compared to his previous position. It is apparent that the need for childcare (which was never raised with the Applicant) arose from the Respondent’s own changed personal circumstances. In any event, the Respondent did not ask the Applicant to consider changing the hours of work of the redeployed position on a temporary or permanent basis, to accommodate his family circumstances. The Respondent simply refused to consider the position under any circumstances, as he wished to get a pay-out.
It is submitted by the Applicant that a viable and reasonable course of action for the Respondent, would have been to take a period of carer’s leave without pay, until his personal life was settled, and then return to work in the solid job that he was offered. The Respondent could then have volunteered for any overtime on offer, if he wished to, and then at a later time, either apply for promotions within Followmont when they became available, or apply for positions external to the Company.
As a long-standing employee, with skills, qualifications and experience that were needed by Followmont, the Applicant submits that it acted fairly and reasonably in choosing to retain the Respondent in employment, via redeployment to acceptable employment.
There were no formal or informal expressions of interest for redundancy solicited or accepted by the Applicant. Therefore the Respondent’s comment that “others were paid out and let go” refers to employees whose skills, qualifications and experience were assessed by Followmont Transport as being unsuitable for redeployment into other roles. There were no voluntary redundancies.”
[30] In the Applicant’s Material in Reply, it was submitted that the Employer was aware of the Respondents personal circumstances and communicated with him on several occasions regarding this, and the redeployment position between 6 July 2016 and 29 July 2016. The Applicant stated that the Respondent was given the opportunity to speak with the Director of Followmont Transport, Mr Mark Tobin with regard to the Respondent’s view that he should be paid out redundancy pay and notice, rather than be redeployed.
[31] The Applicant submitted, that the Respondents argument that Followmont Transport should agree to pay the redundancy pay and notice on ‘compassionate grounds’ is because his family needed the pay –out, he needed a job with more money and he was unable to work at the time.
[32] The Applicant submitted that the basis for the Respondent’s claim that he is entitled to redundancy pay is predicated on the basis that it is a way for him to finance his personal commitments, rather than staying in gainful employment. The Applicant stated that in an email of 22 August 2016 from the Respondent, he expressed that he did not want to take up the redeployment position because he has a car loan and bills to pay, and the redundancy payment is a preferable way to finance these.
[33] That Applicant submitted that the Respondents claim relating to childcare is not a relevant consideration to the question of whether the redeployment position was acceptable employment. The Applicant stated that the Respondents need for childcare did not arise out of the change to his employment, and it is apparent that the need for childcare has arisen from the change in the Respondent’s personal circumstances. The Applicant submitted that the Respondent did not raise the issue of changing the hours of work of the redeployment position, on a temporary or permanent basis to accommodate his personal circumstances. The Applicant stated that the Respondent refused to take or consider taking the redeployment position as his preference was to receive a pay-out.
[34] The Applicant submitted that the course of action the Respondent should have taken to accommodate his personal circumstances, was to take a period of carer’s leave without pay until his personal circumstances settles and then return to the redeployment position. The Applicant stated that the Respondent could have volunteered for any overtime that was on offer, and could have also applied for promotion within Followmont when such positions became available, or he could have applied for positions external to Followmont Transport.
[35] The Applicant submitted that the Respondent was offered the alternative position over others because he was a long-stand employee who had the requisite skill, qualifications and experience that was needed by Followmont Transport. The Applicant stated there were no formal or informal expressions of interest for redundancy solicited or accepted by the Applicant, nor were there any voluntary redundancies. The Applicant stated that the Respondent’s comment that “others were paid out and let go” refers to employees who did not have the requisite skills, qualifications and expressions as assessed by Followmont Transport, as being suitable for the redeployment positions.
[36] The Applicant stated that it believed that it had acted fairly and reasonably in deciding to retain the Respondent via the redeployment position, which it classified as acceptable employment.
[37] Further directions were set on 26 August 2016 for the Applicant to address the Respondents entitlement to penalty rates in the redundant position compared with that of the redeployment position. The Applicant was specifically directed to provide a breakdown of the Respondent’s weekly wage under the redundant position, compared with the redeployment position, illustrating where penalty rates or a higher rate where the Respondent acted in the position of Team Leader, were applicable.
[38] The Applicant was also directed to address the issue concerning the amount of redundancy pay the Respondent would be entitled too, given the inconsistency in the amount stated in the application filed by the Applicant, and in the Statutory Declaration of Alice Atkins.
[39] The Applicant submitted that the Respondent’s weekly gross pay with his previous position was $1,000.04 per week for 38 hours comprising:
“a) $723.14 for weekday ordinary hours and
b) $276.91 for Saturday work inclusive of penalty rates which were paid as time and half for the first two hours and double time thereafter for all work on a Saturday.
The Respondent’s weekly gross pay with the new position would have varied between:
a) $798.00 per week gross with a 5.30am or later start; and
b) $1,037.40 per week with a 5am start.
In the new position, Saturday overtime work would have offered to the Respondent of between 4-7 hours on a rotational basis, which means he would have received an additional $147 -$273 for Saturday overtime on 1-2 occasions every four weeks.”
[40] The Applicant submitted that Respondent would have been entitled to 13 weeks redundancy pay, as per Ms Atkins’ statutory declaration, not as per the Application.
Consideration
[41] An application pursuant to s.120 has multiple elements, of which the Commission must be satisfied, prior to issuing an Order.
[42] Firstly, the wording of the section is that an entitlement to redundancy pay must exist, in order for the Commission to vary that redundancy pay entitlement. The Commission has previously held that in order for s.120 of the Act to have any application, there must first be an entitlement to redundancy pay pursuant to s.119 of the Act. 1 Further, it was held that where there is no entitlement under s.119, there can be no order to reduce the “entitlement” pursuant to s.120.2
[43] Employees are entitled to redundancy pay pursuant to the provisions of the Act. Section 119 relevantly provides that an employee is entitled to be paid redundancy pay by the employer, if the employee’s employment is terminated at the employer’s initiative, because the employer no longer requires the job done by the employee, to be done by anyone, except where this is due to the ordinary and customary turnover of labour. The Respondent’s position of Storeperson on the Applicant’s information was no longer viable in the Packing and Distribution Department of Followmont Travel due to a substantial reduction in demand and revenue in the packing side of their magazine business unit. This is not contested by the Respondent.
[44] Both parties accept, and I am satisfied, that the Respondent has an entitlement to 13 weeks redundancy pay, pursuant to s.119 of the Act, subject to any order that the Commission may make. Relevantly, what must be considered is whether the Applicant obtained other acceptable employment for the Respondent.
[45] A Full Bench of the Commission in The Maritime Union of Australia v FBIS International Protective Services (Aust) Pty Ltd 3 summarised the case authority in relation to whether other acceptable employment had been “obtained”, as follows:
“[42] The question of what is required by the word “obtains” was considered by the Full Bench in Derole Nominees. It found:
“The word ‘obtains’ does not appear in its context to mean actually obtain in the fullest sense possible. In circumstances like those occurring at the company one employer is incapable in law of effecting a contract of employment between his employee and another employer whether by assignment or otherwise; the creation of the legal relationship of master and servant depends on a mutuality being arrived at between the individual and the incoming employer. Therefore, the pursuit of alternative employment by the outgoing employer cannot be expected, by reason of itself alone, to produce new employment; there will usually and perhaps always remain the opportunity for the incoming employer, and the employee, to disagree as to matters such as terms of employment, suitability of the job to the employee and vice versa so that alternative employment may not eventuate.
It follows that ‘obtain’ must be given some lesser meaning. The Shorter Oxford Dictionary (3rd ed revised) provides as its relevant meaning, the definition of ‘obtain’ as ‘to procure or gain, as the result of purpose and effort’. It seems to us that meaning is of assistance here; that is, the employer by purpose and effort may establish an opportunity which suits the employee and which crystallises as alternative employment of an acceptable kind.” 4 [citations removed]
And
“Viewed in this way it will be seen that the intention is not to impose an absolute test on the employer’s ability to ‘obtain’ alternative employment but rather it refers to action which causes acceptable alternative employment to become available to the redundant employee. The employer must be a strong, moving force towards the creation of the available opportunity.” 5
[43] In Datacom Vice President Lawler also expressed the view that the word “obtains” in the context of s.120 should be given a very broad interpretation. 6
[44] In Allman v Teletech International Pty Ltd, 7 Marshall J considered whether Teletech International Pty Ltd (Teletech) had been “able to arrange alternative employment” which appeared in provisions for relief from the obligation to pay redundancy payments within relevant workplace agreement, upon its employees being offered employment by Telstra upon taking over a contract formally held by Teletech. His Honour considered the Full Bench decision in Derole Nominees, finding that “[t]here is no material difference between obtaining alternative employment and being able to arrange it.”8
[45] Justice Marshall found that Teletech assisted its employees to apply for jobs with Telstra, had active involvement in the transition of the employees to work with Telstra, met with Telstra to discuss the possible employment of the employees by Telstra and secured a commitment from Telstra that Telstra would give all redundant Teletech employees the opportunity to apply for employment with Telstra. He found:
“Teletech was not, however, a strong moving force towards the creation of the available opportunity. The available opportunity arose because Telstra was to perform functions formerly performed for it by Teletech. Telstra required staff. It made sense for it to approach Teletech staff. Teletech did not secure the offer of a job for Teletech staff with Telstra. As counsel for the applicants submitted, Teletech arranged an opportunity for the employee applicants to participate in a recruitment process undertaken by Telstra.” 9
[46] Whilst accepting that Teletech brought the employees and Telstra together and that Teletech’s conduct was one of the factors that brought about the employment, Justice Marshall found that it did not mean that Teletech was able to arrange the employment, finding that Teletech facilitated its staff applying for jobs with Telstra, competing on their merits for the available positions. 10 His Honour found that:
“The encouragement and facilitation of a process is not the same as doing everything possible to ensure a result. Arranging alternative employment means bringing about that employment should the employee choose to accept it. Anything short of that, such as competing with competitor applicants (albeit limited to two categories of applicant: existing Telstra and Teletech employees) does not meet the test provided by the relevant sub-clause in the AWAs.” 11”
[46] The Applicant submitted that the Respondent was informed that he would be redeployed to the position of AM Forklift Operator. This position was verbally offered, and confirmed via letter, to the Respondent on 5 July 2016. In the Statutory Declaration of Ms Alice Atkins, she stated that she spoke and corresponded with the Respondent regarding his redundancy and the redeployment position on 7, 25, and 29 July 2016 and 1 August 2016. During these communication’s, the Respondent expressed that he did not wish to take up the redeployment position due to his ‘life circumstances’.
[47] On the material provided, the Applicant “obtained” the other employment of AM Forklift Operator at their Brisbane Operations Branch, being the same location as the Respondents redundant position. Accordingly, it must be considered whether any differences have resulted from the change in employment conditions to determine whether the other employment was “acceptable”.
[48] The Commission must consider the new employment contract, to enable the Commission to assess the “acceptable” nature of that employment.
[49] In the matter of Australian Chamber of Manufacturers v Derole Nominees Pty Ltd 12, the Full Bench stated as follows:
“What constitutes “acceptable alternative employment” is a matter to be determined, as we have said, on an objective basis. Alternative employment accepted by the employee (and its corollary, alternative employment acceptable to the employee) cannot be an appropriate application of the words because that meaning would give an employee an unreasonable and uncontrollable opportunity to reject the new employment in order to receive redundancy pay; the exemption provision would be without practical effect.
Yet, the use of the qualification “acceptable” is a clear indication that it is not any employment which complies but that which meets the relevant standard. In our opinion there are obvious elements of such a standard including the work being of a like nature, the location being not unreasonably distant; the pay arrangements complying with award requirements. There will probably be others.” 13
[50] In Clothing and Allied Trade Union of Australia v Hot Tuna Pty Ltd 14, the Full Bench in considering acceptable alternative employment stated:
“...We do not propose to repeat here the thoroughly detailed argument presented by counsel for the union. A considerable part of that case was devoted to questions of onus and to supporting the proposition that the test of acceptability of the alternative employment is an objective one involving a consideration of such matters as pay levels, hours of work, seniority, fringe benefits, workload and speed, job security and other matters. It was argued that the failure of the employer to adduce evidence of such matters caused the company to fail to make out a case for an exemption. We have no doubt that there is an onus on the employer invoking cl 51(c) and that matters of the kind referred to by the union may be relevant in assessing the position in a particular case. We do not believe it to be necessary to make that examination in every case. Where an employee has accepted alternative employment in circumstances as those here, then in the absence of positive evidence going to the unacceptability of that employment, including unacceptable features of it, then the Commission is entitled to hold the employment as an acceptable alternative and relieve the employer of the obligation under cl 51(c) of the award...” 15
[51] The status of the Redeployment position was that it is a full-time position with an average of 38 hours per week, identical to the Respondents redundant position in hours required. The redeployment position’s working hours are between approximately 6:00am to 2:06pm, Monday to Friday. In the redundant role the Respondent worked Tuesday to Saturday, where he was required to start at 5:00 am on Thursdays and Fridays.
[52] On the information presented, the ordinary hourly rate of pay offered for the redeployment position was $21.00/hour, which is a higher hourly rate than the redundant positions, which was $20.34/hour. As submitted by the Applicant and the Respondent, one appreciable difference between the redundant position and the redeployment position, was that the redundant position attracted penalty rates.
[53] Where the Respondent began work at 5:00am on the Thursday and Friday morning, a penalty rate was attached between the hours of 5:00am and 6:00am. In addition to this, where the Respondent performed a higher duty, in the role of Team Leader on a Saturday, this also attracted penalty rates.
[54] The Applicant submitted that whilst the redeployment role in Followmont’s Transport warehouse operations department may not require the same amount of regular weekend overtime in the other position, the Respondent would have been able to volunteer for any overtime that was on offer. The Respondent submitted that the change in days and hours that applied to the redeployment position would result in a reduction of his wage by $150.00/week.
[55] The Applicant submitted that the Respondent’s gross weekly pay in the redundant position was $1,000.04, compared with the redeployment position where the Respondent would have been entitled to $798.00 gross weekly pay with a 5:30am or later start. The Applicant stated that the Respondent would have received $1,037.40 per week with a 5:00am start in the redeployment position; however in the Statutory Declaration of Alice Atkins she stated that the start time for the redeployment position would have been 6:00am.
[56] The Applicant submitted that the Respondent would have been offered Saturday overtime between 4-7 hours on a one in four week rotational basis. This would have meant that the Respondent would have received an additional amount of between $147.00-273.00 for Saturday overtime, on this basis of one week per month. The Applicant stated that the Respondent would have been able to take up the additional Saturday overtime between 1-2 occasions per month.
[57] The Applicant stated that although the redeployment position had a higher hourly rate of pay, in comparing the gross weekly pay that the Respondent received in the redundant position, with what would have been received in the alternative position; the Respondent would have received approximately $200.00 less per week in the other position, due to the loss of entitlement to the penalty rates.
[58] The Applicant submitted that the location of the redeployment position is the same as the redundant position, being the Applicants Brisbane Operations Branch.
[59] The alternative position involved some similar warehouse duties to the redundant position. There was one notable difference between the two roles; being the more frequent or virtually full-time use of a forklift in lieu of stockroom duties. The Applicant submitted that the employee records at Fellowmont Transport show that the Respondent has a valid forklift licence, and did use this in the redundant role when he was required.
[60] The Respondent would be disadvantaged in terms of his accrual of service towards taking long service leave in not accepting the alternative position.
Conclusion
[61] For the aforementioned reasons, taking into account all of the circumstances in accordance with s.120 (1)(b)(i) of the Act, the discretion is exercised pursuant to s.120(2) of the Act to reduce the amount of redundancy pay, on the basis that other acceptable employment was obtained by the Applicant in their business for the Respondent. The alternative position has been compared.
[62] The offer of this alternative work by the Applicant is acknowledged and this aim to maintain the Respondent in employment. The Respondent’s refusal of the position is recognised on grounds relating to the remuneration and changed duties but also because it was not compatible with his immediate personal circumstances, although the Applicant allowed for such, and was willing to hold the position at that time.
[63] The Respondent has an entitlement to 13 weeks redundancy pay. The comparison between the roles sets out the impact of the lesser pay and duties comparative of the other employment. However, in other respects the role provide for other acceptable employment. Accordingly, pursuant to the discretion in s.120(2), the redundancy pay is reduced to the amount of 8 weeks redundancy payment, less an amount of taxation according to law associated with a redundancy payment. This amount is payable within 14 days from the date of this Decision.
[64] An Order reflecting the terms of this Decision will issue separately. 16
COMMISSIONER
1 Application by CAE Australia Pty Ltd [2012] FWA 7992 per Watson VP at [13].
2 Ibid; also refer M & S Dickson [2011] FWA 5206 per Lewin C.
3 [2014] FWCFB 6737.
4 (1990) 140 IR 123, at 127.
5 (1990) 140 IR 123, at 128.
6 [2013] FWC 1327, at para 12.
7 [2008] 178 IR 415.
8 [2008] 178 IR 415, at 418.
9 [2008] 178 IR 415, at 419.
10 [2008] 178 IR 415, at 419.
11 [2008] 178 IR 415, at 419.
12 (1990) 140 IR 123.
13 (1990) 140 IR 123 at pp128.
14 (1988) 27 IR 226.
15 (1988) 27 IR 226 at pp230 - 231.
16 PR584973.
Printed by authority of the Commonwealth Government Printer
<Price code C, PR584975>
0
6
0