[2014] FWCFB 2143 |
FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.604 - Appeal of decisions
SENIOR DEPUTY PRESIDENT RICHARDS |
BRISBANE, 29 APRIL 2014 |
Summary: Appeal against decision [2014] FWC 516 and the orders of Deputy President Gooley in matter number U2013/2397 - appeal raises questions about the proper construction of s.389 - meaning of genuine redundancy - s.389(1)(b) of the Fair Work Act - for the purposes of s.389(2) - failure to make the requisite finding etc - decision and orders quashed - application under s.394 dismissed on rehearing.
[1] Mr Paul Murray was dismissed from his employment with Ventyx Pty Ltd T/A Ventyx an ABB Company (“Ventyx”) on grounds of redundancy, after serving a period of employment that commenced in January 2012 and concluded on 2 July 2013 - a period of some 16 months.
[2] Mr Murray subsequently lodged an application for an unfair dismissal remedy pursuant to s.394 of the Fair Work Act 2009 (Cth) (“the Act”).
[3] By her decision [[2014] FWC 516] and order [PR547199] of 30 January 2014 Deputy President Gooley rejected Ventyx’s contention, as it was, that Mr Murray’s dismissal was a case of genuine redundancy (within the meaning of ss.385(d) and 389 of the Act).
[4] At the time of his termination, the Applicant was paid $14,290.75 (less taxation) in lieu of notice (which Ventyx claimed was four weeks in excess of his statutory obligation) and another $9,527.17 (less taxation) in severance or redundancy pay. The Deputy President subsequently ordered for purposes of remedy that Mr Murray be paid an (additional) amount of $64,650 (less taxation).
[5] A stay order was sought in relation to the appeal, and that application was heard on 24 February 2014. The sum ordered to be paid to Mr Murray was subject to an order, and the monies were placed in an interest bearing account, pending the outcome of the appeal process.
[6] Permission to appear under s.596 of the Act was extended to both parties’ legal representatives.
The appeal
[7] Ventyx has appealed the Deputy President’s decision that there was no genuine redundancy and that Mr Murray had been unfairly dismissed, along with the Deputy President’s orders on remedy.
[8] Before turning to the particular issues raised in the appeal we make some general observations about the nature of an appeal from an unfair dismissal decision. The relevant principles in this regard were set out in the recent decision by the Full Bench of the Commission in Technical and Further Education Commission T/A TAFE NSW v L. Pykett [2014] FWCFB 714 (“Re: Pykett”):
[4] An appeal under s 604 of the FW Act is an appeal by way of rehearing and the Commission’s powers on appeal are only exercisable if there is error on the part of the primary decision maker. There is no right to appeal, rather an appeal may only be made with the permission of the Commission.
[5] The decision subject to appeal was made under Part 3.2 - Unfair Dismissal - of the FW Act. Section 400 (1) provides that permission to appeal must not be granted from a decision made under that part unless the Commission considers that it is in the public interest to do so. Further, in such matters appeals on a question of fact may only be made on the ground that the decision involved a ‘significant error of fact’ (s 400(2)). In Coal & Allied Mining Services Pty Ltd v Lawler and others, Buchanan J (with whom Marshall and Cowdroy JJ agreed) characterised the test under s.400 as ‘a stringent one’. The Commission must not grant permission to appeal unless it considers that it is ‘in the public interest to do so’.
[6] The task of assessing whether the public interest test is met is a discretionary one involving a broad value judgment. In GlaxoSmithKline Australia Pty Ltd v Makin a Full Bench of the Commission identified some of the considerations that may attract the public interest:
“... the public interest might be attracted where a matter raises issue of importance and general application, or where there is a diversity of decisions at first instance so that guidance from an appellate court is required, or where the decision at first instance manifests an injustice, or the result is counter intuitive or that the legal principles applied appear disharmonious when compared with other recent decisions dealing with similar matters. [citations removed]
[9] We adopt the approach of the Full Bench as cited.
[10] The appeal focuses on three aspects of the Deputy President’s decisions and order:
(i) the finding that Mr Murray’s dismissal was not a ‘genuine redundancy’;
(ii) the finding that the Mr Murray was unfairly dismissed; and
(ii) the compensation order of $64,650 (less taxation).
[11] We are satisfied that it is in the public interest to grant permission to appeal. The appeal raises questions about the proper construction of s.389(1) of the Act.
[12] We now turn to deal with each of the issues. In so doing we proceed on the basis that our examination of the decision under appeal incorporates the various grounds of appeal as set out in the original notice of appeal of 20 February 2014 and as otherwise supplemented by the written submissions of 11 March 2014.
[13] We add that for the purposes of proceeding we will initially deal with the argument on jurisdiction under s.389 of the Act, and then turn to consider the appeal grounds in relation to the substantive or merits hearing.
Section 389(1) of the Act - jurisdiction
[14] Section 385(d) of the FW Act provides that a person has been ‘unfairly dismissed’ if, among other things, the Commission is satisfied that the dismissal was not a case of ‘genuine redundancy’. The expression ‘genuine redundancy’ is defined in s.389 of the Act:
389 Meaning of genuine redundancy
(1) A person’s dismissal was a case of genuine redundancy if:
(a) the person’s employer no longer required the person’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise; and
(b) the employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.
(2) A person’s dismissal was not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within:
(a) the employer’s enterprise; or
(b) the enterprise of an associated entity of the employer.
Background
[15] Mr Murray had performed duties as a technical project manager (TPM) for Ventyx. In this capacity he provided technical advice and project management services in relation to software development and commissioning projects. It was accepted that TPM’s can move between projects and are not dedicated to one specific project.
[16] Ventyx at any one time can be engaged on a number of projects. It also has offices in some 20 countries.
[17] In June 2012 Mr Murray was informed that the project on which he was working would be cancelled. Thereafter he worked on different projects.
[18] From May 2013 Mr Murray was placed “on the bench”. This appears to be a nominal position in which employees are placed when they are between projects and are not billing hours. Employees who are on the bench appeared to utilise their time in completing training courses. Mr Murray completed some short term work but other than that it appears as though it was established that “his schedule would be completely free for the next six months”.
[19] It appears that Ventyx undertook a review of its global business which had not been performing to expectations. Eventually some 100 employees globally were made redundant. Nine positions were made redundant in the Asia-Pacific region (Australia) consulting team. It was unchallenged that no new employees have been employed in the Asia-Pacific consulting team in the six months since the redundancies.
[20] The Deputy President found that the requirements of s.389(1)(a) of the Act were made out:
I accept the evidence of Ventyx that it was no longer prepared to employ surplus employees and it needed to reduce its head count. It therefore made a decision to review employees who were on the bench and unfortunately for Mr Murray he was on the bench at that time and there was no work in the pipeline for him. I therefore find that Mr Murray's position was redundant. 1
[21] The Deputy President then turned her mind to whether the requirements of s.389(1)(b) of the Act had been made out.
[22] There seems to be no argument that the consultation clause in the Professional Employees Award 2010 (“the award”) applied to Mr Murray’s employment, and that Ventyx was obliged to conduct itself in the manner there set out. The relevant provision is as follows:
9.1 Consultation regarding major workplace change
(i) Where an employer has made a definite decision to introduce major changes in production, program, organisation, structure or technology that are likely to have significant effects on employees, the employer must notify the employees who may be affected by the proposed changes and their representatives, if any.
(ii) Significant effects include termination of employment; major changes in the composition, operation or size of the employer’s workforce or in the skills required; the elimination or diminution of job opportunities, promotion opportunities or job tenure; the alteration of hours of work; the need for retraining or transfer of employees to other work or locations; and the restructuring of jobs. Provided that where this award makes provision for alteration of any of these matters an alteration is deemed not to have significant effect.
(b) Employer to discuss change
(i) The employer must discuss with the employees affected and their representatives, if any, the introduction of the changes referred to in clause 9.1(a), the effects the changes are likely to have on employees and measures to avert or mitigate the adverse effects of such changes on employees and must give prompt consideration to matters raised by the employees and/or their representatives in relation to the changes.
(ii) The discussions must commence as early as practicable after a definite decision has been made by the employer to make the changes referred to in clause 9.1(a).
(iii) For the purposes of such discussion, the employer must provide in writing to the employees concerned and their representatives, if any, all relevant information about the changes including the nature of the changes proposed, the expected effects of the changes on employees and any other matters likely to affect employees provided that no employer is required to disclose confidential information the disclosure of which would be contrary to the employer’s interests.
Deputy President’s decision
[23] The Deputy President considered the following circumstances:
By May 2013 Ventyx was known to be underperforming as a business and downsizing was proposed as a means of addressing that problem and that “they needed to look at people who were on the bench”;
A global plan was discussed at a meeting on 3 June 2013 and “[a]t that meeting it was proposed that they would reduce the number of staff who were on the bench”;
Mr Murray’s name was on a list at that time (as he was on the bench), though Mr Weerasekera (Mr Murray’s manager) had attempted to find work on a project for Mr Murray but had been unsuccessful”;
On 11 June 2013, managers were informed there was an imperative to reduce staff numbers and to set about identifying staff who had “limited prospects of work”;
The CEO approved the “right sizing” and this decision was made known by an email on 12 June 2013;
A request was made to provide confirmation of the names of persons to be made redundant by 14 June 2013;
The names of those to be made redundant were not finalised by 23 June 2013;
Mr Murray’s name had been on the list of those who may be made redundant since 3 June 2013;
Mr Murray was informed of his redundancy on 1 July 2013;
Ventyx held that it did not inform employees likely to be affected by the decision until 1 July 2013 because of security concerns (for its own systems and that of its client businesses), amongst other matters;
Mr Weerasekera and Ms Shrubsole (the Senior Human Resources Advisor) met with Mr Murray on 1 July 2013;
Mr Murray “was told that if there are any mitigating circumstances or other relevant information that [they] had not considered to let them know as soon as possible;”
Mr Murray was given a redundancy pack, which contained correspondence stating that he would be retrenched the following day - 2 July 2013; and
At a further meeting on 2 July 2013, Mr Murray asked questions and expressed interest in a number of positions.
Findings on jurisdiction
[24] The Deputy President went on to make a series of findings and to raise a series of concerns in regard to the consultation obligation under the modern award. There is some interconnection between these findings and concerns. We consider that it is convenient to deal with each of the Deputy President’s findings on jurisdiction discretely. As there are a series of findings that go to the proper construction of s.389 of the Act, we think it is important in the public interest to approach the appeal in some detail in this respect.
First jurisdictional issue
[25] The Deputy President found as follows:
[35] I do not accept that because some of the employees who were likely to be affected were not covered by the Award, Ventyx was absolved of its obligation to discuss the proposed changes with employees who were covered by the Award.
[36] I do not accept the submissions of Ventyx that it was only practicable to discuss the decision once the individual had been identified and security issues could be addressed. While I accept that there may have been some security concerns, Mr Erasmus accepted he did not have any security concerns about Mr Murray. I do not accept that the only way Ventyx could have managed its security concerns was to not advise employees of the decision until all employees could be notified and have their computer access shut down.
[26] The award obligation at clause 9.1(b)(ii) provides as follows in relation to the notification of change etc:
The discussions must commence as early as practicable after a definite decision has been made by the employer to make the changes referred to in clause 9.1(a). [Our emphasis]
[27] The inclusion of the word “practicable” means the relevant discussions must occur with expedition, but subject to reasonable practical considerations, or as early as might reasonably be feasible. Such a definitional approach seems to be commonly accepted on the basis of the commentary in the Words and Phrases Legally Defined, 4th Edition (Edt. David Hay) 2013.
[28] We note that the The Oxford English Dictionary (1978 Re-Print) provides the following definition of “practicable”:
Capable of being put into practice, carried out in action, effected, accomplished, or done; feasible
[29] Further, The Macquarie Dictionary Online Sixth Edition (published in October 2013) similarly defined practicable as meaning:
Capable of being put into practice, done, or effected, especially with the available means or with reason or prudence; feasible.
[30] We see the kinds of issues that informed the conduct of Ventyx as comprising such practical considerations. There was no attack on the genuineness of Ventyx’s claims in this regard, or concerns that they were inherently unreasonable considerations.
[31] We do not discern in the evidence before the Deputy President, therefore, any grounds on which she could have rejected claims put to her by the witnesses about the range of matters it was required to manage prior to notifying the affected employees of the major change and its likely significant effect upon them.
[32] The evidence was unchallenged.
[33] For example, the evidence before the Deputy President was that Ventyx had contractual obligations to ensure the integrity and confidentiality of its client data. It gave effect to this contractual obligation by ensuring that those employees who were likely to be affected by a redundancy were off-line at the time that they were so informed. Mr Storer, the Senior Vice President Global Consulting, gave the following evidence:
Due to the nature of the business that the Respondent operates, in terms of the level of access to customer darter and importance of protecting the integrity of the darter, it was crucial that the staff involved in the process maintain absolute confidentiality about the process. This was also why the notification to all staff had to occur at the same time to avoid the risk of damage to the Respondent's reputation if a staff member of his position had been, or was likely to be made redundant misappropriated customer data.
[34] The Deputy President was not in a position to reject (or to not accept) the evidence (more of which is set out below in rehearing) without providing reasonable grounds for so doing so. But she did not do so.
[35] It is similarly so in respect of the approach of Ventyx in respect of how it communicated and managed the change process across its global business, and in respect of identifying those who were subject to award arrangements and those who were not.
[36] It appears to us that there are no evidence-derived reasons for rejecting Ventyx’s otherwise unchallenged claims as to the factors which affected the practicability of the time at which it commenced discussions about major change.
[37] Employers may face various exigencies which will affect the practicability of the timing of the commencement of discussions with employees. Some of those circumstances are set out above. There will be others (and especially so for publicly listed companies and remote construction projects for example).
[38] We think the award provision to ensure that discussions occur as early as practicable is intended to apply to circumstances such as that which faced Ventyx, principally security concerns and the need to manage a global review process on a common approach.
[39] Again, without having evidence-based reasons to reject Ventyx’s explanation as to why it proceeded in the manner it did to communicate the redundancies, the Deputy President fell into error. The Deputy President also (or in the alternative) fell into error in not having regard to the language of the award provision for the purposes of s.389(1)(b) of the Act (in so far as she did not consider whether Ventyx acted as early as “practicable”).
Second jurisdictional issue
[40] Having decided, erroneously as we have found, that Ventyx had not acted as soon as it practicably might have, the Deputy President went on to find that:
As such there was no opportunity for Mr Murray to change the decision made by Ventyx either to downsize the consultancy business or to make him redundant. 2 [Our emphasis]
[41] This repeated the Deputy President’s earlier finding that:
It is clear that the Award obliges the employer to do more than tell the affected employees what it intends doing; it must give the employee information about what is decided and give the employees an opportunity to put forward alternatives to avert or mitigate the adverse impact of the decision and give consideration to those proposals. This includes providing the employees with an opportunity to change the employer’s decision. 3 [Our emphasis]
[42] The Deputy President appears to have evaluated the conduct of Ventyx for purposes of s.389(1)(b) of the Act against the standard that an employee must be given an opportunity to change the decision made by the employer.
[43] This was a point made on appeal by the Appellant.
[44] The employer was required to give effect to its obligations under the award provisions set out above at clause 9.1(b)(i) of the Award:
(b) Employer to discuss change
(i) The employer must discuss with the employees affected and their representatives, if any, the introduction of the changes referred to in clause 9.1(a), the effects the changes are likely to have on employees and measures to avert or mitigate the adverse effects of such changes on employees and must give prompt consideration to matters raised by the employees and/or their representatives in relation to the changes.
[45] Clause 9.1(b)(i) of the award does not require an employer to provide an opportunity for the employee to change the definite decision it has made. The award obligation, instead, requires the employer to discuss certain prescribed matters (the introduction of the changes, the likely effects of the changes, and to consider measures to mitigate the adverse effects of such changes).
[46] So far as the Deputy President used language that re-formulated the obligation under clause 9.1(b)(i) of the award (to mean the employer was obliged to give an employee an opportunity to change its decision), she fell into error.
[47] We note that Barnes J of the Federal Circuit Court in Ingersole v Castle Hill Country Club Limited [2014] FCCA 450 recently, and relevantly, commented in much the same manner about the proper construction of the award obligation:
145. It was also submitted for the Applicant that in substance cl.8 was an "ancient" clause that should have been construed as including a duty to consult to avert future changes (not merely the prejudicial effects of a decision that had already been made). Insofar as such contention was initially put on the basis that Judge Raphael was clearly wrong in his interpretation of the part of the clause considered in Qantas that was similar to cl.8.2(a) of the Award, this argument was not maintained. In any event, consistent with the principles of construction considered in Kucks, on the clear wording of cl. 8 of the Award it is apparent that no consultation is required until a definite decision has been made and then the consultation envisaged is as set out in cl.8.2(a), in relation to the introduction and likely effects of the changes decided upon and measures "to avert or mitigate the adverse effects of such changes on employees", not to avert (or avoid) the changes themselves.
[...]
149. Insofar as the Applicant maintains the contention that the construction of cl.8 of the Award is in doubt, having regard to the particular clause in question and the general principles of construction considered in Qantas and cases referred to therein, I am satisfied that the wording of cl.8 of the Award makes it clear that the obligation to consult does not arise unless and until a definite decision has been made by the employer. In other words, the obligation under cl.8 is not an obligation to consult on mere proposals or possible major changes which, if adopted, would have the effect of introducing major changes likely to have significant effects on employees (such as termination of employment).
[...]
151. Even though in one sense a definite decision to introduce a change consisting of a termination of employment would be a "fait accompli" before the mandated discussions were to commence (Municipal Officers Association at [3 9]), the rationale and scope for a requirement of consultation in such a case is clear on the language of cl. 8 of the Award, in particular cl.8.2(a). It extends to the introduction of the changes about which there has been a definite decision, the effects such changes are likely to have on employees and measures to avert or mitigate the adverse effects on employees of such changes. I am satisfied that the obligation on the Club under the Award was to notify, consult and discuss in relation to the results or effects of changes that the Club had made a definite decision to introduce. [Our emphasis]
Third jurisdictional issue
[48] The Deputy President continued on to find that the requirement to discuss the change with the likely affected employees was not a discussion as such (for the purposes of s.389(1)(b) of the Act) but an announcement of Ventyx’s intention to make the change and to initiate the various redundancies:
[30] [W]hat occurred on 1 and 2 July 2013 was not discussion about the proposed change. Mr Erasmus was clear, once someone’s name was on the approved list, there was nothing they could do to have their name taken off the list. Mr Weerasekera agreed that there was nothing Mr Murray could have said to him that meant he could have taken him off the list. Mr Storer said the only circumstances in which a person’s name could come off the list was if “some new work that we had previously been unaware of had been contracted and we had demand for their skills.”
[31] It is clear from the script that what was to be discussed was “the process from this point.” Further, it is clear that Ventyx only considered itself obliged to notify Mr Murray of “the business change and the reasons for [his] position becoming redundant.” Mr Weerasekera told Mr Murray that “there is no work and we are changing the structure of the group and there won’t be tech PM roles.”
[...]
[34] It is clear that what took place on 1 July and 2 July 2013 was not a discussion as required by the Award as Mr Murray raised a number of issues including alternative positions. These matters were not responded to until after Mr Murray’s employment had been terminated. [Our emphasis]
[49] The Deputy President’s finding in relation to s.389(1)(b) of the Act is central to the jurisdictional issue she was required to determine. Her finding in that regard was that the discussion conducted on 1 July 2013 with Mr Murray was not a discussion in effect, but rather an announcement of the decision to make his (Mr Murray’s) position redundant.
[50] Some discussion of the structure of the award consultation clause is necessary as a preliminary to reviewing the Deputy President’s finding above.
[51] We think it is a reasonable proposition on the face of the plain language of the award clause that it is premised upon the discussions occurring prior to or in advance of the implementation of the redundancies as such, but after the definite decision has been made. For example, clause 9.1(a)(i) provides:
Where an employer has made a definite decision to introduce major changes in production, program, organisation, structure or technology that are likely to have significant effects on employees, the employer must notify the employees who may be affected by the proposed changes and their representatives, if any.
[52] Similarly, clause 9.1(b)(iii) also provides as follows:
For the purposes of such discussion, the employer must provide in writing to the employees concerned and their representatives, if any, all relevant information about the changes including the nature of the changes proposed, the expected effects of the changes on employees [...]. [Our emphasis]
[53] Here the award clause makes it clear that the discussions must be about the “expected effects” on employees (who may be affected) of the proposed changes.
[54] It went unchallenged, and was accepted by the Deputy President, that Mr Murray was not made redundant on the day on which he was notified of the changes to Ventyx’s staffing structure or profile. On the evidence, Ventyx read to Mr Murray from a prepared script used by managers. Apart from explaining the cause of the changes the script as read to Mr Murray was a follows:
At this time, although your Technical Project Manager role has been involved in a variety of tasks, we haven't been able to well utilise the role or worked to the level required. Looking forward, there is little forecast for the next 3 months and the pipeline of work for the next six months is not established.
For these reasons, the organisation has determined that your role is redundant.
The purpose of this meeting is to notify you of this change and talk through with you, the process from this point.
This is also a time to ask questions and for more information. We will go through the redundancy process and talk about the next steps.
We have reviewed all vacancies in the business and unfortunately no suitable alternative positions are available at this time.
If you feel that there are any mitigating circumstances or other relevant information, that we have not considered, please let me know as quickly as possible. [Our emphasis]
[55] The information pack proceeded to refer to the letter of redundancy, which was to take effect on 2 July 2013.
[56] In respect of that letter Mr Murray was informed of the reasons for the changes:
We will meet/talk again tomorrow- this will give you the chance to consider any other issues so that we can answer any questions, respond to any concerns - also provide us with any of the information that may be relevant to you. [Our emphasis]
[57] Mr Murray was further informed that:
I would like to discuss the next steps from here. You don't need to go back to work after this meeting – you'll go home.
We will just check the items that you have to be returned to the business.
I'll see you/talk to you tomorrow to answer any questions. I have arranged a time to you [to meet]. This will be another chance for questions or comments that may have occurred to overnight. We can also finalise any documentation, return the items of company property that you have.
I think we have discussed everything we need to at this stage for today. We will talk again tomorrow. (sic)
[58] At the same time as the above matters were communicated, Mr Murray was given a letter of redundancy dated 1 July 2013. That letter of redundancy read in part as follows:
Following discussions today, this letter confirms that as a result of an organisational review, the Company has decided to make your position redundant. Accordingly, you will be retrenched effective 2 July 2013.
We have conducted a review of other opportunities in an endeavour to redeploy, second or point you to another similar role. Unfortunately no suitable opportunities currently exist.
This letter will serve as a formal notice of your position’s redundancy. You will be paid in lieu of your notice period, together with redundancy pay and any accrued leave entitlements. Payment will be processed within seven days.
[...]
May we take this opportunity to express our appreciation for the contribution you have made and which you every success in your future endeavours.
[59] It appears to us that the Company had reached a high degree of confidence in relation to the course on which it had embarked. This is to be expected where an employer has made a “definite decision” to introduce change. Indeed, the award clause (at 9.1(a) and 9.1(b)) itself also anticipates the consequences of the change arising from the “definite decision” by referring to the likelihood of its effects on employees. The evidence of the witnesses for Ventyx reasonably reflects this degree of certainty.
[60] Notwithstanding this, however, the Company expressly left open the opportunity for the Applicant to put other information to it that it had not considered to mitigate the effects of its decision on the employees affected (including Mr Murray).
[61] The Company may well have had the view that it was unlikely that the situation or the circumstances would change as a consequence of this process. The Deputy President found as such. But equally so, there was no evidence before the Deputy President that the opportunity provided by the Company to consider any further information the following day from Mr Murray was not genuine or that any information or views put forward by Mr Murray on 2 July 2013 would be dismissed or discounted as a matter of automaticity.
[62] We think that absent evidence that went to the genuineness of the opportunity provided to Mr Murray to consider the circumstances overnight and provide Ventyx with any additional information it may have overlooked or not considered, the Deputy President’s finding that the process was not compliant with the award clause was not capable of being asserted.
Fourth jurisdictional issue
[63] The Deputy President’s findings, however, went further than this. In effect, the Deputy President, at paragraph 34 of her decision (cited above) found that Ventyx failed to:
give prompt consideration to matters raised by the employees and/or their representatives in relation to the changes.
[64] The reason the Deputy President found as such was that in the second interview (2 July 2013) Mr Murray expressed an interest in the availability of at least three positions in Ventyx’s office in Atlanta, USA. The positions were identified from a list of vacant positions he had been provided Ms Shrubsole. Ms Shrubsole indicated that she did not want to give the impression to Mr Murray that Ventyx could “just relocate [him] to Atlanta as this was a business decision with appropriate expense approvals required.” It appears from the evidence that Mr Murray sought information about the positions or how to look into them further.
[65] It would not be for some days following the Applicant's redundancy that Ms Shrubsole found herself with time to commence investigating the positions that Mr Murray had expressed interest in, but that investigation was cut short once the application for relief under s.394 of the Act was received.
[66] In the context of this discussion, the obligation that falls on the employer under clause 9.1(b)(i) of the award involves two mandatory steps. The employer must:
1. “discuss” with the employee(s) measures to avert or mitigate the effects of the change; and
2. “give prompt consideration to matters raised [...] in relation to the changes.
[67] The requirement to give “prompt consideration” reasonably arises from the potential for the matters as raised by the employee(s) (or their representatives) to avert or mitigate the effects of the changes following from the definite decision to implement change. That aside, the matters to which the employer must give consideration are matters that are raised by an employee in relation to the changes which are the subject of the definite decision.
[68] The responsibility to consider the Applicant’s expression of interest in the Atlanta positions appears to have fallen upon Ms Shrubsole, in so far as she was the only person who gave evidence about the manner in which the matter was considered or otherwise dealt with. The onus to give evidence (as it may be) of the promptness of the response to any matters raised by an employee (for the purposes of clause 9.1(b)(i) of the award) rests with the employer.
[69] On Ms Shrubsole’s evidence, perhaps for no reason other than her workload at the time, she claimed that she did not take steps to action in relation to considering the positions in Atlanta cited by Mr Murray until well after Mr Murray’s redundancy had taken effect. Ms Shrubsole said the matter had “completely slipped [her] mind”.
[70] Because of this, Ventyx therefore cannot be said to have given the matters raised by the Applicant “prompt consideration” as the award clause obligates it to do.
[71] This is not to say that consideration was not given to other matters raised by Mr Murray: quite detailed correspondence was directed to Mr Murray on 5 July 2014 to this effect that demonstrates that Ventyx had considered those matters as it was obligated to do. And usually it will be the case that a response to an employee about the matter(s) raised will be the means by which an employer will demonstrate that consideration has been given to the matter(s) as raised (though there may be other sources of evidence, of course).
[72] But there is no evidence of Ventyx having considered the outstanding matter of the Atlanta positions as raised by Mr Murray. This matter may reasonably be taken to be a matter raised in relation to the changes which were the subject of definite decision taken by Ventyx. It appears from the evidence of Ms Shrubsole that she was unable to give consideration to the outstanding matter raised by the Applicant “promptly”. Regardless of whether or not the matter as raised had merit or would have changed the outcome in any substantive way, the award warranted Ventyx giving the matter prompt consideration (and being able to demonstrate that it did so).
[73] Though for somewhat different reasons than the Deputy President, we therefore find that the Deputy President was correct in concluding that Ventyx failed to meet the requirements of clause 9.1(b)(i) of the award to:
give prompt consideration to matters raised by the employees and/or their representatives in relation to the changes.
[74] We note that where an employer elects to provide a limited period within which to discuss matters consequential of a decision to make a definite change in its business, difficulties may arise in relation to an award-derived obligation to “give prompt consideration to matters raised by the employees and/or their representatives in relation to the changes”. That is very much the issue that arose in this matter.
Fifth jurisdictional issue
[75] The Deputy President continued on to make a finding in relation to whether it would have been reasonable in the circumstances for Ventyx to have redeployed Mr Murray in its enterprise or an associated entity (for the purposes of s.389(2) of the Act). Given her finding in relation to s.389(1)(b) of the Act, it was not necessary for the Deputy President to do so for the purposes of determining the jurisdictional question. But she proceeded to do so for reason that:
“given [my] decision in this matter, I will address this issue because it is relevant to the question of how long Mr Murray would have remained in employment.” 4
[76] In so far as the Deputy President made findings in relation to s.389(2) of the Act (even if for a purpose other than for establishing the jurisdictional prerequisites of the application), we are obligated to consider those findings.
[77] The Appellant contends that the Deputy President fell into error in her finding in so far as she misconstrued the jurisdictional focus in s.389(2) of the Act. We set out the relevant elements of the Deputy President’s decision as follows:
[41] Mr Weerasekera gave evidence of his attempts to find work for Mr Murray after the SPARQ project was cancelled. He was successful in finding Mr Murray work up until June 2013. The nature of Ventyx’s business model was that it employed permanent employees to work in a project based business. It is therefore inevitable that if a project comes to an end the employees will be allocated to another project if one is available. It is clear that after the decision, Mr Weerasekera looked for work for Mr Murray in Australia. Mr Weerasekera did not look for jobs for Mr Murray outside of Australia despite the fact that during his employment with Ventyx he had performed work outside of Australia. There was no evidence that Mr Weerasekera or anyone else looked for lower paid positions for Mr Murray.
[42] Mr Murray was provided on 1 July 2013 with a list of job vacancies. There was conflicting evidence about the list that was provided to Mr Murray. I accept the evidence of Mr Murray that the list he was provided was the list that is exhibited to his witness statement. For whatever reason that list did not indicate that certain jobs on the list were in Australia. As a consequence Mr Murray did not express an interest in those positions. Mr Weerasekera reviewed the Australian jobs and determined that they were not suitable.
[43] It is clear from the evidence that Ventyx did not consider that it was obliged to consider if any of the other positions were suitable for Mr Murray. It is also clear that the list was provided to Mr Murray on the basis that he would be required to apply for the positions. It is also clear that despite expressing interest in some positions no action to investigate these positions was taken by Ventyx until after his employment was terminated. While Mr Weerasekera gave evidence that he had subsequently seen the job descriptions, he also gave evidence that the job descriptions were not available to be sent to Mr Murray. He did not determine if those positions were suitable for Mr Murray nor did he provide any feedback to Mr Storer or Mr Schoeman that Mr Murray was interested in these positions as an alternative to redundancy.
[44] It is also clear that Ventyx did not consider offering Mr Murray a lesser skilled job at a lower rate of pay despite Ventyx’s own redundancy policy stating that alternative positions which include a position which is less comparable because it might be at a lower salary or level, require a different skill set or a significantly different location, could be offered to employees.
[45] As the list of jobs was provided to Mr Murray, I can only assume that Ventyx considered at least some of the jobs on the list were suitable for Mr Murray, otherwise why provide the list at all.
[46] Ventyx did not consider redeployment to an overseas vacancy as reasonable in all the circumstances because of the costs of relocation and because these positions could be filled by local people. Ventyx did not discuss with Mr Murray whether he would have accepted redeployment to an overseas posting without the payment of relocation costs. If the positions were only available to local employees, one can only ask why were they included on a list provided to Mr Murray.
[47] Ventyx submitted that redeployment was not reasonable because there had been a global downturn in their business. However despite that downturn it had vacant positions.
[48] Ventyx submitted that is does not usually relocate employees overseas unless there is a business reason to do so and there was no business reason to do so. The same might be said about any relocation or reassignment. However the Fair Work Act 2009 requires redeployment if it is reasonable in all the circumstances and unlike the situation described by Senior Deputy President Richards in Roy v SNC-Lavalin Australia Pty Ltd, here the Respondent did have Australian employees working overseas and provided Mr Murray with information about overseas vacancies. Further there was no evidence to support the submission that each international office of the Respondent generally recruits locally for advertised positions (or has control of the recruitment process). Mr Storer’s evidence was that “when considering a potential relocation, the main consideration would be whether the staff member could do the job and whether they were the only person who could do the job.” Even accepting this limitation, which I do not, no steps were taken to see if Mr Murray could be redeployed to these positions prior to his dismissal.
[49] While Mr Storer said there were local people who could fill the jobs, it is not supported by the evidence as those positions were vacant and no evidence was put that they had been filled. Further, Ventyx’s own policy commits it to giving preference to “suitably qualified and experienced employees whose positions have become redundant when filling all vacancies prior to external advertising.”
[50] I am therefore satisfied that it would have been reasonable to redeploy Mr Murray to one of the positions on the list provided by Ventyx. At the very least these matters should have been fully explored during the discussion process.
[78] The Full Bench in Re: Pykett considered the basis on which the Commission can reach a finding in relation to s.392 of the Act. In so doing it found as follows:
[35] As we have mentioned, the use of the past tense in the expression ‘would have been reasonable in all the circumstances for the person to be redeployed ...’ in section 389 (2)(a) directs attention to the circumstances which pertained when the person was dismissed. As noted in Honeysett, [T]’he exclusion poses a hypothetical question which must be answered by reference to all of the relevant circumstances’. The question is whether redeployment within the employer’s enterprise or an associated entity would have been reasonable at the time of dismissal. In answering that question the Full Bench in Honeysett observed that a number of matters are capable of being relevant:
“They include the nature of any available position, the qualifications required to perform the job, the employee’s skills, qualifications and experience, the location of the job in relation to the employee’s residence and the remuneration which is offered”.
[36] [...] For the purposes of s.389(2) the Commission must find, on the balance of probabilities, that there was a job or a position or other work within the employer’s enterprise (or that of an associated entity) to which it would have been reasonable in all the circumstances to redeploy the dismissed employee. There must also be an appropriate evidentiary basis for such a finding. Such an interpretation is consistent with the ordinary and natural meaning of the words in the subsection; the Explanatory Memorandum and Full Bench authority. We acknowledge that the facts relevant to such a finding will usually be peculiarly within the knowledge of the employer respondent, not the dismissed employee. If an employer wishes to rely on the ‘genuine redundancy’ exclusion then it would ordinarily be expected to adduce evidence as to the following matters:
(i) that the employer no longer required the dismissed employee’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise;
(ii) whether there was any obligation in an applicable modern award or enterprise agreement to consult about the redundancy and whether the employer complied with that obligation; and
(iii) whether there was a job or a position or other work within the employer’s enterprise (or that of an associated entity) to which it would have been reasonable in all the circumstances to redeploy the dismissed employer.
[37] The evidence in relation to (iii) would usually include canvassing the steps taken by the employer to identify other work which could be performed by the dismissed employee.
[38] As we have mentioned, we accept the respondent’s submissions as to the proper construction of s.389(2). But that is not the end of the matter. The difficulty for the respondent is that the Commissioner failed to make the requisite finding and for that reason the appeal must be upheld [...].
[79] The Full Bench went on to consider the relevant findings of the decision under appeal, including the following:
[33] The respondent has objected to the application on the basis the termination of the applicant’s employment was a “genuine redundancy”. It would, however, in my view, have been reasonable in all the circumstances for the respondent to redeploy or to consider redeploying the applicant within its enterprise other than to an advertised, permanent vacancy. I do not consider it necessary in the circumstances of this case to determine which position, specifically, would have been appropriate for redeployment of the applicant. That the respondent did not allow for any consideration of the redeployment of the applicant within its enterprise other than under the artificial confines of the Managing Excess Employees-conditioned understanding of “redeployment”, in and of itself, leads me to the conclusion the dismissal was not a genuine redundancy within the meaning of the Act.”
[80] The Full Bench went on to conclude in relation to the above finding that:
[40] The Commissioner erroneously focussed on the inadequacy of the appellant’s redeployment policy and failed to make a finding that there was a job, a position or other work to which Ms Pykett could have been redeployed. Such a finding is a necessary step in reaching the conclusion that it would have been reasonable in all the circumstances for Ms Pykett to be redeployed within the appellant’s enterprise. The failure to make such a finding is an error which warrants correction on appeal. [2014] FWCFB 714 [Our emphasis]
[81] We note that the decision in Re: Pykett was handed down the day prior to the publication of the Deputy President’s decision. The practical opportunity to have regard to that authority was therefore limited.
[82] Notwithstanding this, in the current circumstance, the Deputy President was aware that there was a list of vacant positions made available to Mr Murray, but there was no information at all about those positions and whether they were positions to which Mr Murray may have been redeployed (let alone reasonably so). None of the positions were identified by the Deputy President in her decision. As we discuss further below, there can be no expectation that the list of positions were given to Mr Murray for redeployment purposes in any event.
[83] Nonetheless, the Deputy President concluded that the Applicant could have been reasonably redeployed to an undefined position on that list:
[50] I am therefore satisfied that it would have been reasonable to redeploy Mr Murray to one of the positions on the list provided by Ventyx.
[84] Despite so finding, however, the Deputy President also found that she could:
[45] only assume that Ventyx considered at least some of the jobs on the list were suitable for Mr Murray [...]. [Our emphasis]
[85] And later in her decision, the Deputy President went on to find that:
[60] Had Ventyx complied with their policy, I consider there was a chance that Mr Murray would have been redeployed.
[86] We think the Deputy President’s wider findings shed light on the scant evidentiary support for a finding that Mr Murray could have been redeployed to an (unidentified) job on a list comprising various jobs and positions. The Deputy President herself made no findings about the jobs on the list, and only found that there was only a “chance” that Mr Murray would have been redeployed. The Deputy President, further, found that she could only “assume” Ventyx believed Mr Murray could have been suitable for “some” of the jobs on the list as provided to him (though she originally found that Mr Murray could have been redeployed to “one” of the positions on the list).
[87] Absent a properly evidenced finding that there was a position to which Mr Murray could have been re-deployed, the Deputy President was not jurisdictionally positioned to determine whether it would have been reasonable in all the circumstances to redeploy Mr Murray:
Such a finding is a necessary step in reaching the conclusion that it would have been reasonable in all the circumstances for Ms Pykett to be redeployed within the appellant’s enterprise. 5
[88] Even assuming there had been a position to which Mr Murray could have been redeployed, it was also argued on appeal in relation to the Deputy President’s consideration of the reasonableness of redeployment, that the Deputy President had failed to take into account certain evidence led by Ventyx such as:
[89] This was evidence (along with that of Mr Storer which is set out further below) that went unchallenged at the initial hearing. It was relevant to the finding as to the reasonableness (or not) of the redeployment of Mr Murray to Atlanta. It is true the Deputy President herself questioned that evidence in her decision by herself proposing ‘counterbalancing’ arguments (see paragraphs 46, 48 and 49 of the Deputy President’s decision). But in doing so the Deputy President did not rely on any contrary evidence for that purpose.
[90] Because of this, we further think the Deputy President’s finding in relation to the reasonableness of redeployment (assuming that there had been a position to which Mr Murray could have been redeployed) was not available to her in so far as she did not take into account the unchallenged evidence above. Thus, the “hypothetical question”, to which the Full Bench in Re: Honeysett referred (see above), could not have been answered.
Conclusion on jurisdiction
[91] We have found that the Deputy President fell into error in various aspects of her exercise of jurisdiction under s.389 of the Act. The Deputy President’s finding in relation to one element of s.389(1)(b) of the Act, however, was sound on review.
[92] On the basis of this singular jurisdictional deficiency (against its award obligations), Ventyx cannot be found to have made Mr Murray “genuinely redundant” for the wider purposes of s.389 of the Act.
[93] As a consequence of this conclusion, we now turn to consider the Deputy President’s finding in relation to the substantive matter.
Findings on Merit: Section 387
[94] The Deputy President found largely it would appear that the requirements of s.387(a), (d), (e), (f) and (g) of the Act were of neutral or no significance for her ultimate determination, or else had been complied with by Ventyx. Some of her findings in other respects require some comment by the Bench, however.
s.387(b) of the Act: Notice
[95] In relation to her considerations under s.387(b) of the Act, the Deputy President commented that “this provision is neutral if the reason for the dismissal did not relate to the capacity or conduct of the dismissed employee”. But the Deputy President immediately went on to say that “whether this criterion is taken into account here or when considering s.387(h) the failure to afford employees procedural fairness prior to the dismissal is a relevant factor in determining if the termination is unfair.”
[96] It appears that the Deputy President was of the view that notice in respect of an operational reason (not being a valid reason for s.387(a) of the Act) was nonetheless a matter that warranted apportioning weight for the ultimate finding (that the dismissal was harsh, just or unreasonable) under either s.387(b) or s.387(h) of the Act.
[97] As the Deputy President herself found by reference to the Full Bench in UES (Int’l) Pty Ltd [2012] FWAFB 5241 (“Re: UES”), the notice referred to under s.387(b) is in respect of “that reason”, and “that reason” relates to the valid reason under s.387(a) of the Act.
[98] It follows that the issue of notice in respect of an operational reason cannot be the subject of a finding under s.387(b) of the Act, as the Full Bench in Re: UES made clear. So far as the Deputy President’s decision suggests to the contrary, she fell into error.
[99] We note further that the Deputy President went on to rely on the Full Bench decision in Re: Crozier v Palazzo Corporation Pty Ltd S5897 (“Re: Crozier”) and quoted the following extract:
As a matter of logic procedural fairness would require that an employee be notified of a valid reason for the termination before any decision is taken to terminate their employment in order to provide them with an opportunity to respond to the reasons identified. Section 170CG(3)(b) and (c) would have very little (if any) practical effect if it was sufficient to notify employees and give them an opportunity to respond after a decision had been made to terminate their employment. Much like shutting the stable door after the horse has bolted. [Our emphasis]
[100] Having so quoted the Full Bench, the Deputy President concluded:
Mr Murray was given a letter of termination on 1 July 2013 to take effect on 2 July 2013. Mr Murray was notified of the reason after the decision to terminate his employment had been taken. 6
[101] We consider that contrary to the premise of the Deputy President’s reasoning above, the Full Bench as cited above is not referring to a situation in which an employee had been terminated for operational reasons/redundancy. The Full Bench in Re: Crozier was referring, instead, to notice given in relation to a valid reason arising from a dismissal based on capacity and/or conduct for the purposes of s.170CG(3)(b) of the Workplace Relations Act 1996, which is in identical terms as current s.387(b) of the Act.
[102] On the face of its plain words, the Full Bench made the point that an employee was required to be notified of the valid reason for the dismissal so he or she could respond prior to the dismissal taking effect. Further (and again), the Full Bench in Re: Crozier was concerned with the operation of s.170CG(3)(b) of the Workplace Relations Act 1996 (and now current s.387(b) of the Act) and is not relevant to circumstances where a dismissal is because of an operational reason. To the extent the Deputy President considered otherwise her findings were in error, and misapplied the authority in Re: Crozier (at the expense of the authority in Re: UES).
[103] We think any consideration of the relevance of notice to an operational reason for dismissal is a matter best considered under s.387(h) of the Act (and then in the context of the award provision in relation to consultation in relation to major change and not otherwise).
Section 387(c) of the Act: opportunity to respond to “any reason related to the capacity or conduct of the person”
[104] The Deputy President found as follows:
For the reasons are set out above in relation to s.387(b), UES suggest that this factor is neutral. However I adopt the same position as I did to section 387(b) which is that it is a relevant factor. The opportunity to respond must be given before a decision is taken to terminate the employee’s employment. 7
[105] The circumstances of this case relate to a dismissal on the basis of operational circumstances, which was accepted by the Deputy President. As such, the matter cannot be “a relevant factor” for purposes of s.387(c) of the Act. In so far as the Deputy President intended to convey otherwise she fell into error.
[106] A matter concerning whether an employee was given an opportunity to respond to an operational reason for his or her dismissal is a matter perhaps best canvassed under s.387(h) of the Act. We have commented above that s.387(b) of the Act, like s.387(c) of the Act, relates to a valid reason finding made under s.387(a) of the Act, and has no application where the employee’s employment is terminated for operational reasons/redundancy. The Full Bench in Re: UES, which concerned a dismissal for operational reasons/redundancy, put it this way:
The matters in s.387(b) and (c) of the FW Act deal with whether there was procedural fairness in respect of a reason for dismissal related to Mr Harvey's capacity or conduct as a matter of fact Mr Harvey was not notified or given an opportunity to respond to reason to his dismissal related to his capacity or conduct however given the reasons his dismissal, we regard them as neutral matter is with respect to our consideration as to whether Mr Harvey's dismissal was harsh, unjust or unreasonable. 8
Section 387(h) of the Act
[107] The Deputy President went on to find that for purposes of s.387(h) of the Act, however, that the dismissal of Mr Murray was for a sound, defensible or well founded reason:
[63] Mr Murray’s employment was terminated because at the time Ventyx decided it was going to reduce its workforce in the consultancy business, he was on the bench. I have accepted that there were operational reasons for the decision to reduce the number of employees in the business. [...] I therefore conclude that there was a sound, defensible or well founded reason for the termination of Mr Murray’s employment.
[108] The Deputy President found that Ventyx had not misled Mr Murray at the time of his recruitment about his employment security (noting that Mr Murray had only been employed for some 14 months):
[64] While Mr Murray made submissions about his relocation from the UK to Australia to take up this position, he was not head hunted and there was no deception involved in his recruitment. There was no evidence that Ventyx was planning to downsize its business when they offered Mr Murray a job. He knew that he was being employed as a TPM and that he could be moved from project to project.
[109] The Deputy President found that Ventyx had acted unfairly (albeit lawfully) against Mr Murray:
[65] Mr Murray was given no notice of the decision to downsize the business. He was given no real opportunity to find other work within Ventyx or with its associated entities. He was given no real opportunity to change Ventyx’s decision. Further, Ventyx did not comply with its own redeployment policy and examine both comparable and non comparable positions for Mr Murray. Employees are entitled to expect that companies will comply with the policies they promulgate. While I accept that Ventyx was lawfully entitled to buy out the notice period to do so in circumstances that made its redundancy policy ineffective is unfair.
[110] The Deputy President went on to find that there was a chance Mr Murray might have been redeployed:
[66] Had Ventyx complied with their policy, I consider there was a chance that Mr Murray would have been redeployed.
[111] The Deputy President proceeded to find that:
Ventyx submitted that I should find that the failure to consult does not make the termination unfair. I do not agree. Had consultation occurred Mr Murray would have been better able to look for work within Ventyx and with other companies. He would have had the opportunity to look for work whilst still in work. Mr Murray was denied the opportunity that was provided for in the Ventyx policy to be redeployed to a comparable and non-comparable position. Mr Murray was presented with a fait accompli dressed up as consultation. He was unfairly dismissed.
[112] We do not find the Deputy President’s finding immediately above to be capable of being supported by the factual case before her.
[113] The point raised expressly on appeal was that (then) clause 9.2 of the award was not directed at providing a “job search” opportunity as it required discrete discussion instead. And in any event, there was no evidence that could lead to a conclusion that Mr Murray was better placed to find work from a condition of employment.
[114] We do not discern from the evidence how if “consultation” (by which we presume the Deputy President meant “discussion”) under the award had occurred that it would have meant that “Mr Murray would have been better able to look for work within Ventyx and with other companies”. The only evidence that was germane to the matter was that of Mr Weerasekera, and his unchallenged claim was that there were no jobs in Australia in Ventyx that were suitable for the Applicant.
[115] Equally we do not discern any evidentiary basis for the Deputy President’s finding that if “consultation” had been extended (further) then the Applicant would have been better placed to look for work “in other companies”. Again, this is a finding made without any evidentiary foundation.
[116] The related point on appeal was that Ventyx’s conduct in acting lawfully in making payment in lieu of notice could not give rise to a finding that it had acted “unfairly”.
[117] We agree. The fact that Ventyx acted as it lawfully might to make payment of notice in lieu (in circumstances where there were no Australian-based jobs available) does not establish unfairness for the wider purposes of s.387(h) of the Act.
[118] We note here too that the Deputy President found that the making of payment in lieu of notice was contradictory to Ventyx’s Redundancy, Redeployment and Retrenchment Policy (“the Policy”). But here we point out that the Policy states that Ventyx will:
[...] at its discretion, make a payment in lieu of requiring the employee to work for all or part of the relevant notice period.
[119] To summarise: the Deputy President’s finding under s.387 of the Act variously mischaracterised the award obligation; lack sufficient nexus with an evidentiary context; misrepresented the authority in Re: Crozier; and unreasonably construed lawful conduct (articulated in the redeployment policy) to be unfair. These are matters because of their scope and significance that warrant granting permission to appeal and quashing the decision of the Deputy President.
Findings on Remedy: Section 390
[120] We think for reason of completeness that it is desirable to comment upon the Deputy President’s findings in relation to remedy, as they were subject of considerable focus on appeal.
[121] The principal finding subject of the appeal was that the Deputy President concluded, for purposes of s.392(c) of the Act, that but for the termination of Mr Murray’s employment, he would have been employed for “another 12 months” 9
[122] The point on appeal here was that the Deputy President used an erroneous method for the assessment of the remuneration that Mr Murray would have received or would have been likely to receive if he had not been dismissed.
[123] It is proper that we proceed by way of considering the Deputy President’s finding in its context.
[124] The Deputy President found, initially, that it was not “appropriate in the circumstances to reinstate Mr Murray” and that there were no TPM jobs available for Mr Murray at the time of his termination or thereafter:
[69] Mr Murray is seeking reinstatement of his employment. I accept that Ventyx had to reduce staff and that no new staff, except for one sales position, have been employed by Ventyx consulting team since July 2013. No evidence was called about employment in other teams or associated entities. Mr Murray submitted that he had expertise in areas that Ventyx was moving into but evidence was given that this work did not eventuate. I accept that things have not improved in the six months since the termination. I accept that there are no TPM positions any more.
[125] No finding was made in relation to s.391(b) of the Act, as to whether appointment to another position on terms and conditions no less favourable than those on which Mr Murray was employed before the dismissal (or termination) was appropriate.
[126] Nor did the Deputy President make a finding in relation to s.391(1A) of the Act, which concerns appointment to an associated entity of the employer when an employee’s position no longer exists.
[127] The Deputy President continued:
[73] Had there been consultation, Mr Murray may have found alternative work. While Ventyx had decided to no longer use TPM’s, it still had roles for technical leads and there was no evidence that Mr Murray was not qualified to do that work albeit paid at a lower rate of pay. Further it had vacancies both in and out of Australia.
[74] There was evidence that the other technical project manager had applied for a senior project manager position which he took up in November 2012. It was not clear from the evidence when this position was advertised.
[75] In all the circumstances, I consider that Mr Murray would have remained in employment for another 12 months. I have had regard to Mr Murray’s willingness to consider a lower paid position or positions overseas without the payment of relocation payments as an alternative to redundancy. I also accept that Mr Murray like the other TPM could have transitioned to a number of different roles.
[128] A point was also taken on appeal that the Deputy President misdirected herself in so far as she misunderstood the evidence led in relation to her conclusion that “Mr Murray like the other TPM could have transitioned to a number of different roles”.
[129] The evidence of Mr Weerasekera was that another TPM had been seconded to a different Division of Ventyx where he continued to perform duties on an ongoing project on which he had been engaged. There was no evidence that this TPM had been “transitioned” to another role at the time of Mr Murray’s redundancy, or that that TPM had been provided with a means of avoiding redundancy whereas Mr Murray had not. In short, the circumstances of the other TPM had no relevance to a finding in relation to Mr Murray.
[130] The Deputy President concluded that she had “had regard to Mr Murray’s willingness to consider a lower paid position or positions overseas without the payment of relocation payments as an alternative to redundancy.”
[131] We were not able to be taken to any evidence that supported the Deputy President’s conclusion in this regard. Mr Murray did not inform Ventyx that he was prepared to meet his own relocation expenses to take up a position abroad when he provided Ventyx with his views on mitigating the effects of the changes. This was why Ms Shrubsole’s evidence showed she was sensitive to this very concern in her discussions with Mr Murray.
[132] Further, Mr Weerasekera gave unchallenged evidence (which was accepted by the Deputy President) that there were no jobs in Australia into which Mr Murray could have been redeployed.
[133] We also note that the Deputy President relied deliberately upon her finding in relation to s.389(2) of the Act above as providing the presumption (in part) for her conclusion that Mr Murray would have been employed for a further 12 months, but for the termination of his employment. In so far as the Deputy President failed to identify any such position for the purposes of s.389(2) of the Act (as explained above), reliance cannot be had on that finding.
[134] As a consequence, it was not open to the Deputy President on the evidence to reach the finding that the Applicant would have been employed for a further 12 months. In this case, a discrete evaluation of the available evidence was necessary in order to reach a conclusion as to how long Mr Murray might have remained in employment, (if at all) following the downsizing decision by Ventyx. That did not occur, and the ultimate finding was unnecessarily speculative in the circumstances.
[135] This is perhaps more so the case when it is taken into account that the Deputy President formed a view (for purposes of the determination of the amount to be paid to Mr Murray) that the despite the redundancy for which he was dismissed Mr Murray nonetheless still faced the prospect of a redundancy:
“I would reduce this amount by 30 per cent to allow for the possibility that Mr Murray would have been made redundant [...].” 10
[136] We think such a finding cannot be reconciled readily with the Deputy President’s prior finding that Mr Murray, but for the redundancy, would have been employed for a further 12 month period.
Conclusion
[137] As we have earlier stated, we grant leave to appeal the decision, for reason the appeal attracts the public interest in that it bears upon the proper approach to the construction of s.389 of the Act and the various obligations upon employers that arise from clause 9.1 and clause 9.2 (as it was) of the modern award.
[138] We also agree with the submission made by Ventyx that it is in the public interest that the Full Bench should assist in developing clear lines of authorities in such areas as redundancy decisions of the Commission, which have a high degree of prevalence in a cross section of industries in the economy.
[139] We agree, too, that Ventyx would suffer an injustice if the decision of the Deputy President were to be allowed to stand. As stated above, we quash the Deputy President’s decision.
[140] We uphold the appeal on the grounds as set out in relation to s.387 of the Act, as set out above, and therefore quash the decision of the Deputy President in [2014] FWC 516 and the order in PR547199.
Rehearing
[141] Having quashed the decision and order of the Deputy President we now proceed to rehear the matter, and to consider the various requirements of s.387 of the Act through s.607(3)(b) of the Act. Section 387 of the Act provides as follows:
In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:
(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and
(b) whether the person was notified of that reason; and
(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and
(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal; and
(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(h) any other matters that the FWC considers relevant.
Consideration
(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees)
[142] We concur with the Deputy President's finding (which we discern by inference through reading paragraph 53 with paragraph 63 of her decision) that in the circumstances of a redundancy, such as occurred in this instance, no relevant finding can be made in respect of s.387(a) of the Act. The approach in this respect was set out by the majority in the Full Bench in Re: UES. 11 No case was put to us or to the Deputy President that we should disregard that authority.
(b) whether the person was notified of that reason
[143] Consistent with the Full Bench in Re: UES, in circumstances of a redundancy for operational reasons, whether or not there was notice of “that reason” (being the valid reason referred to in s.387(a) of the Act) is not material to the wider consideration.
(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person
[144] For the reasons given immediately above, this matter too is a neutral matter in respect of our considerations as to whether or not Mr Murray’s termination was harsh, unjust or unreasonable.
(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal
[145] Ventyx did not unreasonably refuse to allow Mr Murray to have a support person present to assist in any discussions relating to the termination of his employment. This is a matter of neutral affect upon our deliberations.
(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal
[146] The termination of Mr Murray's employment did not relate to his unsatisfactory performance. This is not a matter relevant to our consideration is as to whether Mr Murray's dismissal was harsh, unjust or unreasonable.
(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal
[147] This, too, is not a matter that is relevant to our consideration as to whether Mr Murray's termination was harsh, unjust or unreasonable and no evidence was led in the proceedings below. We regard it as a neutral matter with respect to our consideration in this respect.
(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal
[148] As above, this is not a matter that is relevant to our consideration as to whether Mr Murray's termination was harsh, unjust or unreasonable and no evidence was led in the proceedings below. We regard it as a neutral matter with respect to our consideration in this respect.
(h) any other matters that the FWC considers relevant.
[149] The Deputy President found as follows:
[63] Mr Murray’s employment was terminated because at the time Ventyx decided it was going to reduce its workforce in the consultancy business, he was on the bench. I have accepted that there were operational reasons for the decision to reduce the number of employees in the business. [...] I therefore conclude that there was a sound, defensible or well founded reason for the termination of Mr Murray’s employment.
[150] We agree with this finding and do not dispute its evidentiary basis.
[151] We think Ventyx’s conduct in not giving prompt consideration to matters raised by Mr Murray on 2 July 2013 in respect of his interest in a number of the jobs in Atlanta USA, is a relevant consideration as to whether or not the termination of his employment was harsh, unjust or unreasonable.
[152] In so far as Ventyx did not conform to this particular award obligation, it may be said that Mr Murray was terminated harshly.
[153] But we do not conclude that that element of harshness is decisive in relation to a finding as to whether or not the dismissal was harsh, unjust or unreasonable in all the circumstances, particularly given the finding the reason for the dismissal was “sound, defensible and well founded”.
[154] We turn to whether the Applicant was treated harshly or unreasonably because he was not relocated internationally instead of being made redundant.
[155] As mentioned earlier, the unchallenged evidence in this matter was that the cost to relocate a staff member overseas was significant (approximately $15,000 - $30,000) and that Mr Murray had not indicated to the employer that he was prepared to relocate to Atlanta at his own cost.
[156] There was further unchallenged evidence that all the recruitment processes (interviewing etc) for overseas positions took place locally (in the USA). This evidence was given by Mr Storer, the Senior Vice President Global Consulting, was that:
The Respondent routinely send staff overseas to different offices to work on a customer engagements for up to 12 months, although around 3 months or less is usually standard because it is expensive and there are tax implications. The expenses relate to accommodation and travel. The Respondent customers prefer to engage a locally-based staff in order to avoid paying out-of-pocket expenses for accommodation and travel. Further, in many countries using overseas staff for more than a short period can mean that a permanent position has been established, which will then mean assessment for income tax purposes.
Occasionally staff in the consulting team moved between countries on a permanent basis for a career change or other personal reasons that there would be no more than 2 to 3 per year globally. However, there needs to be a position available in the relevant office; as far as I know, positions aren’t “created” to facilitate a move. If a staff member applies for a position and is successful, the Respondent will usually take reasonable relocation expenses.
It is unusual to relocate staff overseas; there needs to be a business reason for the move. The staff member has a skill set that is not available locally, or specialist knowledge of one of the Respondents target industries. The Respondent generally won't move skill set if it can be obtained locally. When considering a potential relocation, the main consideration would be whether the staff member could do the job and whether they were the only person who could do the job.
There is no policy in place which sets out the reasons for relocating staff; it depends on the circumstances and the staff member involved.
[...]
There is a preference to locally based recruitment because it is easier, and cheaper; candidates can be interviewed without significant cost, and their skills and experience will be directly relevant to the local customers. There are also local support networks already in place for the staff member in terms of family and friends. This is important because consulting engagements can be demanding and time-consuming e.g. When an important customer deadline must be achieved.
It costs between $15,000-$30,000 to relocate a staff member overseas. These costs can include flights, shipment of goods, temporary accommodation, transport tax advice etc. the expense is significant and it is an important factor when considering whether relocation is an option.
There is global involvement in all recruitment, as a signoff has to occur at that level, but all of the recruitment in terms of intervening in reviewing of CVs takes place at the local level.
It is not possible to just parachute a staff member into a role in an overseas office. The same principles would apply as for a relocation in terms of the business case for the move and whether the staff member was the best or only person with the skills and experience to perform the role.
I don't believe it would’ve been reasonable to relocate the Applicant to the Atlanta office because:
[157] This evidence was unchallenged.
[158] We do not consider that it was unreasonable (or otherwise) for Ventyx to proceed to terminate Mr Murray’s employment on grounds of redundancy instead of providing an overseas redeployment. In the circumstances, we consider it reasonable that on the evidence before us that Ventyx did not consider such an alternative to be practical. There was no established or articulated policy for overseas redeployment in redundancy situations, and international relocations were more the exception than the rule. Ventyx’s redundancy policy, referred to earlier, makes no reference to such an option or process. Mr Murray could have had no reasonable expectation that international relocations were available in redundancy situations.
[159] Generally, we do not read s.389(2) of the Act as requiring an employer to redeploy an employee whose position has been made redundant to any vacant position. Circumstances, on a case by case basis, may affect the reasonableness of such a course of action (that being redeployment). The Explanatory Memorandum to the Fair Work Bill 2008 (see Item 1552), the Full Bench decisions in Re: Pykett, Re: Honeysett (both cited above) and the Full Bench decision in MacLeod v Alcyone Resources Ltd T/A Alcyone 12 reflect this approach.
[160] True it is that Ventyx handed to Mr Murray a list of jobs available across the global business, but that was a step that came after Ventyx had exhausted its investigation into redeployment options for the Applicant under its redundancy policy. As Counsel for Ventyx claimed, the provision of further information about the organisation was not a step in a redeployment process itself, and cannot in some manner be held to reflect adversely on the appellant as a consequence.
[161] We do not otherwise find that there were any other matters that were material to the requisite finding as to whether Mr Murray was harshly, unjustly or unreasonably dismissed. On the evidence before us we very much doubt that any further scope for extended discussion beyond that provided would have led to a different result. Efforts were made by Ventyx to identify alternative positions or “any work” for Mr Murray that was billable. But in the end, Mr Murray’s position was made redundant for required operational reasons, or as the Deputy President put it:
I accept the evidence of Ventyx that it was no longer prepared to employ surplus and it needed to reduce its head count. It therefore made a decision to review employees who were on the bench and unfortunately for Mr Murray he was on the bench at that time and there was no work in the pipeline for him. I therefore find that Mr Murray's position was redundant. 13
Conclusion
[162] On the basis of the aforementioned discussions we do not conclude that Mr Murray's dismissal was harsh, unjust or unreasonable.
[163] We dismiss his application under s.394 of the Act upon rehearing.
[164] The stay order in PR548105 as made on 24 February 2014 is also set aside as a consequence.
SENIOR DEPUTY PRESIDENT
Appearances:
Mr J. Murdoch, QC, instructed by DLA Piper, for the Appellant
Mr J. Streit, of Counsel, instructed by Think Legal, for the Respondent
Hearing details:
Brisbane
2014
3 April
1 [2014] FWC 516 at [19].
2 [2014] FWC 516 at [38].
3 [2014] FWC 516 at [33].
4 [2014] FWC 516 at [40].
5 Technical and Further Education Commission T/A TAFE NSW v L. Pykett [2014] FWCFB 714 at [40].
6 [2014] FWC 516 at [56].
7 [2014] FWC 516 at [57].
8 [2012] FWAFB 5241 at [42].
9 [2014] FWC 516 at [75].
10 [2014] FWC 516 at [82].
11 [2012] FWAFB 5241 at [42].
12 [2014] FWCFB 1542 at [32].
13 [2014] FWC 516 at [19].
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