[2016] FWC 5730 |
FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s 394—Unfair dismissal
Robert Rubesa
v
Ixom Operations Pty Ltd T/as Ixom
(U2016/4292)
DEPUTY PRESIDENT SAMS |
SYDNEY, 8 SEPTEMBER 2016 |
Application for relief from unfair dismissal – whether the applicant’s dismissal was a case of genuine redundancy – company-wide restructure and transformation process – amalgamation of two roles at two plants into one – duties and responsibilities of both roles considered – new role a higher-level more strategic position – applicant not suitable for new role – redeployment to new role not appropriate – consultation fair and reasonable – applicant’s dismissal a case of genuine redundancy – no jurisdiction – unfair dismissal application dismissed.
[1] This decision will determine an application, filed by Mr Robert Rubesa (the ‘applicant’), pursuant to s 394 of the Fair Work Act 2009 (the ‘Act’). The applicant claims to have been unfairly dismissed, within the meaning of s 387 of the Act, when his position as a Mechanical Maintenance Manager at the Botany Groundwater Treatment Plant (GTP) was made redundant on 31 January 2016 by his employer Ixom Operations Pty Ltd t/as Ixom, formerly Orica (the ‘respondent’, ‘Ixom’ or ‘Company’).
[2] The applicant commenced employment on 25 September 2005, pursuant to a contract of employment, which paid him at the time of his termination, an amount equivalent to $126,343 per annum. The applicant was advised on 16 November 2015 that his role was redundant and at the date of termination (31 January 2016) he received redundancy payments of 8 weeks’ notice and 40 weeks’ redundancy pay, totalling $129,751.80. The applicant’s redundancy pay entitlements and the provisions dealing with consultation and redeployment arise from the respondent’s former redundancy policy, which was in place at the time the applicant commenced employment. The policy is annexed to this decision as Annexure A. It is to be contrasted with the respondent’s current policy – ‘Leaving the Company’ – effective 20 August 2015, which provides for a maximum of 20 weeks’ redundancy pay and 4 weeks’ notice.
[3] There is no complaint the applicant was paid redundancy entitlements according to the conditions and scale set out under the former policy. There is no dispute that the associated redundancy and redeployment terms are not found elsewhere in an Award or Agreement, although it might be observed that the former policy is consistent with the generally-understood principles applying under contemporary statute, notably s 389 of the Act, and under the terms of industrial instruments dealing with redundancy situations.
[4] Nevertheless, the applicant claimed that his termination of employment was not a genuine redundancy within the meaning of s 389 of the Act, in that:
[5] Unsurprisingly, the respondent maintains that the dismissal of the applicant was a case of genuine redundancy, and that being so, he could not have been unfairly dismissed. Accordingly, the dominant statutory provision underpinning this case, is s 389 of the Act, which is reproduced below:
‘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.’
[6] Section 396 of the Act requires the Fair Work Commission (the Commission) to determine a number of jurisdictional or preliminary issues before considering the merits of the application. That section reads:
‘396 Initial matters to be considered before merits
The FWC must decide the following matters relating to an application for an order under Division 4 before considering the merits of the application:
(a) whether the application was made within the period required in subsection 394(2);
(b) whether the person was protected from unfair dismissal;
(c) whether the dismissal was consistent with the Small Business Fair Dismissal Code;
(d) whether the dismissal was a case of genuine redundancy.’
[7] The applicant’s unfair dismissal application was filed on 3 February 2016. It has therefore been lodged within the time limits set out in s 394(2) of the Act. There is no dispute that the applicant is a national system employee. Nor is there any dispute that the applicant’s employment period satisfied the minimum employment period required (s 383), and that the applicant’s salary was below the high income threshold for the purposes of s 382(b)(iii) of the Act.
[8] A person can only be unfairly dismissed if the four prerequisites found at s 385 of the Act have been met. These are:
(a) the person has been dismissed; and
(b) the dismissal was harsh, unjust or unreasonable; and
(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.
[9] Subsection (a) has been satisfied in that the applicant was dismissed at the initiative of the employer (see definition at s 386). Subsection (c) is not relevant and subsection (b) only falls for consideration once the Commission determines that the applicant’s dismissal was a case of genuine redundancy. This decision will deal only with this latter issue. Of course, if that issue is decided against the applicant, then it is unnecessary to take the matter any further. The application must then be dismissed for want of jurisdiction.
[10] As the matter did not resolve at conciliation, the arbitration of the jurisdictional question was referred to me and directions were issued in preparation for a hearing on 9 June 2016. Ms A Mansini from the Australian Mines and Metals Association (AMMA) appeared for the respondent. Mr P Robinson, Solicitor, appeared for the applicant, with permission being granted for him to appear, pursuant to s 596 of the Act.
[11] In his current role, Mr Caswell has the responsibility for considering and evaluating options for improving the respondent’s structure and workforce planning, recommending on recruitment, resourcing, industrial relations, negotiations for enterprise agreements and workplace investigations. Mr Caswell described the operations of Ixom as follows. It is a chemical manufacturing business operating a number of plants in Australia and New Zealand. At Botany, Ixom operates a Groundwater Treatment Plant (GTP) and a Chloralkali Plant (CAP), both of which are located on the same site. Senior Management are common across both plants. About 50 employees (staff and enterprise agreement covered) are employed across the two plants. There is a smaller operation at Port Kembla and other operations in other States. However, Mr Caswell said that none of these sites have any current vacancies.
[12] Mr Caswell explained the operations at both plants. At the GTP, extracted groundwater is pumped and transferred through pipelines to the plant for treatment. Treated water is then re-used and excess water is discharged into Botany Bay. These operations protect the quality of water in the bay and the local environment. The CAP plant produces chlorine and caustic soda using water, electricity and salt. This produces hydrogen as a by-product, which is then used in processes such as hydrogen compression, chlorine cooling and brine treatment/purification. This plant is a declared Major Hazard Facility under the relevant State legislation.
[13] Mr Caswell deposed that the new owners of Ixom (since February 2015) were keen to pursue operational efficiencies and cost reductions across the business, including management and operational roles. Mr Caswell was involved with various senior managers, including the General Manager of Operations, in respect to reviewing operations across Australia and New Zealand (the ‘Review’).
[14] In August and September 2015, the Review considered the need for two Maintenance Lead roles at both plants. The applicant was in the role at the GTP. A proposal emerged to consolidate the two roles into one new Maintenance and Reliability Lead role. It was Mr Caswell’s evidence, that as a result of this change, Ixom would have a more centralised general maintenance structure across its sites, with a direct saving of $100,000 per annum. During October and November 2015, the business communicated its ‘Transformation Program’ to management and staff. The program was to explain the restructure and its impact, including redundancies, across the whole of the business.
[15] Mr Caswell said that after commencing employment as a Mechanical Technician in September 2005, the applicant was offered a revised contract on 1 October 2010 in order for him to transfer to the position of Mechanical Maintenance Manager, then on a salary of $112,000 per annum, with performance-based annual increases. The applicant’s employment was governed by his employment contract and the Company’s policies and procedures.
[16] At a meeting with the applicant on 16 November 2015, he was advised that his role was no longer required and that Ixom would be facilitating the redundancy process and providing him with external outplacement services. This was confirmed in a letter that was given to the applicant that day.
[17] Mr Caswell deposed that at the time of the applicant’s redundancy, there were no available redeployment opportunities which suited his skills and qualifications. The only new role in manufacturing was the amalgamated Maintenance and Reliability Lead Role. This role was advertised in August and December 2015. It required tertiary qualifications and background experience. A formal training and engineering qualification was essential for the role in order for the person to perform duties, other than just maintenance at both plants. The expectation was that the person would implement project planning and consolidation across both sites. This involved a degree of complexity, requiring a tertiary-qualified person. Without tertiary qualifications or requisite qualifications and requisite knowledge of the CAP site, the applicant was not considered suitable for the new role. In any event, Mr Caswell submitted that the applicant had not inquired about, or applied for the new role. The person ultimately chosen was a tertiary-qualified engineer with a Masters of Business Administration, with the potential to lead and manage a team and to implement further efficiencies at the Botany sites.
[18] In further evidence in chief, Mr Caswell explained that the Review in 2015 identified efficiencies in maintenance by reducing the headcount by two. One position came from the resignation of Mr Tony Ng (the applicant’s equivalent at the CTP) and the other from the applicant’s redundancy. Mr Caswell said that some of the duties the applicant previously performed had been redistributed amongst the existing staff. Mr Caswell added that he recently undertook another search for alterative roles for the applicant, but was unsuccessful.
[19] In cross-examination, it was Mr Caswell’s assessment that less than a quarter of the applicant’s former duties are undertaken in the new role. It is essentially looking at process improvement and cost efficiencies across the two plants. It was more than just an amalgamation of the two former roles. On being shown the applicant’s former duties, set out in 2010, Mr Caswell said that a number of these had changed or been simplified since that time. Mr Caswell agreed that a requirement for the job in 2010 was a tertiary qualification. While Mr Caswell said that this had been preferable, it was not a mandatory requirement at the time. He said that the applicant’s skills were sufficient for the GTP position only. He agreed that the applicant had in fact worked in the CAP plant for six years. However, that was in a production role. Mr Caswell was not comfortable with any production employees being on maintenance, when the plant is a Major Hazard Facility. Mr Caswell agreed that the person filling the new role was an external appointment and obviously had no experience in the plant. Mr Caswell did not accept that the applicant would have had more knowledge of the maintenance capacity than the new person. The maintenance function at the GTP was very different and simpler.
[20] Mr Caswell accepted that he had not personally discussed redeployment options with the applicant. He had relied on the applicant’s line manager, Mr David Oram, for an assessment of the applicant’s suitability for the new role. While he accepted that there had been previous disagreements between the applicant and Mr Oram, Mr Caswell still believed the line manager was the best placed person to know the skills and capacity of the applicant. He rejected the suggestion that Mr Oram may have had an ‘axe to grind’.
[21] Mr Caswell said that there still remained mechanical engineers who are subordinate to the lead role, and who deal with day-to-day issues, such as shut downs. However, the new role was to provide a more strategic direction for the business. In comparing the job advertisement with the applicant’s position description, Mr Caswell accepted that he had been involved in the management of a team of skilled employees and contractors, including achieving safety targets and assisting in the shutdown process. The applicant would also assist in managing budgets and proactively dealing with breakdowns. Mr Caswell explained that as there were only 2 chloralkali plants in the Southern Hemisphere (both owned by the respondent), it was unrealistic to expect a candidate for the new role to have direct chloralkali plant experience. However, similar experience can be obtained from petrochemical processes in other types of plant.
[22] Mr Caswell confirmed it was the applicant’s line manager who was responsible for filling the new role and understanding the applicant’s skills and duties. The applicant was considered unsuitable for the new role, but it did not mean he could not apply for it. To the best of Mr Caswell’s knowledge, the relevant State authorities had greater confidence with the management of a Major Hazards Facility, if the relevant persons were tertiary-qualified. Mr Caswell did not understand the GTP to be a Major Hazards Facility. Mr Caswell accepted that staff, including electricians, could cross over between the two plants. Working in both plants did not necessarily mean that the person could assume the new role. However, the new role did not involve carrying out maintenance.
[23] Mr Caswell described the actions taken to identify redeployment vacancies for the applicant after he was deemed unsuitable for the new role. Even so, Mr Caswell believed that the applicant was told by his line manager he could apply for the new role. After being notified of his redundancy, the applicant’s lawyer wrote to the respondent on 22 December 2015 asking a number of questions. Mr Caswell claimed that these questions had been answered. Mr Caswell conceded the questions were reasonable, but that does not mean the applicant received the response he wanted. In any event, Mr Caswell understood that there had been numerous opportunities for the applicant to discuss the issues and various exchanges between the parties had occurred.
[24] In re-examination, Mr Caswell gave further details of the Transformation Program and the distinction between the applicant’s former role and the requirements for the new role. Mr Caswell described the nature of a Major Hazard Facility and how such sites are classified under the Work Health and Safety Act 2011 (NSW).
[25] Mr Caswell stressed that it was mandatory for the person in the new role to have tertiary qualifications. Mr Caswell acknowledged that it had taken six months to recruit the right person and the respondent was only successful after increasing the salary offered. This was because the Company was not attracting the calibre of the person it needed. Mr Caswell reiterated that the roles in the GTP and the CAP were very distinct and the skills were not transferrable. They operate as separate teams with different line managers. Mr Caswell denied the redundancy of the applicant was a ‘ruse’. It had cost the business around $100,000. With Mr Ng’s resignation, the opportunity had arisen for a single role across both plants. Safety issues were also taken into account.
[26] Mr Caswell claimed that after receiving the 22 December 2015 letter from the applicant’s lawyer, he arranged for the Site Manager to talk directly with the applicant. Because the applicant was still employed, these discussions probably occurred every couple of days between December 2015 through to January 2016.
[27] In answer to questions from me, Mr Caswell said that the restructure in February/March 2015 resulted in a reduction in the Company’s global head count of around 10% - 50 roles had been lost in Australia across finance, commercial roles, product managers and the supply chain. Mr Caswell understood other financial changes had occurred, in addition to the redundancies, but he could not give specific details.
[28] Mr Rubesa is 49 years old and has worked in the chemical industry since 1983 and for Ixom (or its predecessor entities ICI and Orica) from 1996-2002 and 2005-2016. The applicant said that the plant was originally intended to operate for a period of only 30 years. It is now to operate for over 100 years. It was on this assumption that he had said to his then line manager, that ‘this is a job for life’ and his line manager had agreed with him.
[29] The applicant’s evidence traced the history of his employment and set out the contract of employment under which he had been employed. He identified a number of allegations which had been made against him in 2013, and which ultimately resulted in a final written warning being issued by the Site Manager, Mr Wijaya. He said that he had raised the issue of redundancy in the past, due to his frustrations resulting from these earlier allegations. He had been told Orica was not offering any redundancies at the time. In December 2014, there was a proposed restructure and Mr Rubesa’s role was to be Containment Lead. However, these proposed organisational changes did not eventuate.
[30] It was the applicant’s evidence that throughout 2014 and 2015, the GTP lost a number of employees, resulting in the remaining employees working longer hours and undertaking more responsibilities. He had raised these issues with his superiors, but without success.
[31] The applicant said that in a meeting with the Site Manager, Mr Oram and HR Representative, Natalie Moore on 16 November 2015, he was handed a letter advising of his redundancy from 31 January 2016. While the applicant raised a number of questions and concerns about staffing, he claimed that no definite decision to restructure was ever discussed with him. On 22 December 2015, the applicant instructed his lawyer to write to the respondent, to dispute his termination was a case of genuine redundancy and make further inquiries. He received no response to the letter. The applicant said he was the only person made redundant and his role still needs to be performed to ensure the plant operates. The applicant said he was escorted offsite on 20 January 2016 after a meeting with Mr Oram in which Mr Oram had asked him why he hadn’t attended any outplacement interviews. The applicant told him he had been too busy in the plant. Mr Oram told him to take ownership of his tasks. He was very upset with how he had been treated after 15 years’ service. The applicant claimed that while always receiving a bonus before 2013, no bonus was paid after that time. He believed this was a result of the difficulties he had with the allegations against him in 2013.
[32] The applicant had been seeking alternative employment, but had been unsuccessful. He has had no income since his dismissal and had expected to continue working until 65 years of age.
[33] In oral evidence, the applicant said that while he worked at the CAP, he was not limited to a production role. He was involved in dispatching goods, refurbishing and maintaining equipment. It was a process maintenance role. The applicant believed the GTP was also a Major Hazard Facility. The applicant said that when he was advised of his redundancy, he was aware that there was to be a new role. He queried Mr Oram as to where the recruitment process was up to. The applicant claimed there was no discussion as to his suitability for the role. Nevertheless, he believed he had the experience for the new position, as he had read the advertisement. The applicant claimed he understood how the CAP operates and that its hazards were similar to the GTP. The applicant could not recall Mr Oram suggesting he should apply for the position. There was not much feedback from him and their relationship was ‘tense’. The applicant noted that his former position had also required tertiary qualifications, which he did not possess. Nevertheless, he was still able to discharge his duties over many years.
[34] In cross-examination, the applicant acknowledged that he received 40 weeks’ redundancy pay. He was seeking 26 weeks’ pay in compensation for unfair dismissal.
[35] The applicant was asked about the hazards at both plants and claimed they were the same or similar, including acid and caustic hazards. The applicant was unaware whether the GTP remained a Major Hazard Facility.
[36] The respondent’s submissions firstly set out the background to the applicant’s dismissal and the legislative provisions governing objections of the kind taken by the respondent to the applicant’s unfair dismissal application.
[37] The respondent then explained the operational changes made by Ixom between 2014 and early 2016, the reasons for the changes and the direct effect of consolidating the maintenance functions at both Botany plants on the applicant’s former role. It was said that the test was not that some, or all of the applicant’s duties survived the restructure, but rather whether his role remained after the restructure. In this case, it clearly did not; see: Kekeris v A Hartrodt Pty Ltd t/as a. hartrodt [2010] FWA 674 and Francis Owen Jones v Department of Energy and Minerals [1994] IRCA 42.
[38] While it was accepted that some of the duties of the applicant’s former role (less than 25%, according to Mr Caswell’s evidence) were required to be performed in the new role, the role of Maintenance and Reliability Lead is significantly different from the applicant’s redundant role because:
[39] It was further submitted that although there was no award or agreement obligation for the respondent to consult with the applicant, from January 2014 to October 2015, he was consulted about changes to his role and the business. Moreover, the applicant was formally advised on 16 November 2015 of his redundancy on 31 January 2016. Therefore, he had ample opportunity to communicate his concerns about his redundancy over a two-month period and in fact, he did so.
[40] The respondent put that s 389(2) of the Act does not require an employer to redeploy an employee to a vacant position. It will be necessary to establish that it was reasonable in all the circumstances to do so; see: Ventyx Pty Ltd v Paul Murray [2014] FWCFB 2143. The applicant not only lacked the requisite tertiary qualifications for the new position, but also he did not even apply for it. The respondent had looked for other alternative roles into which the applicant could be redeployed, but none could be found which were commensurate with his skills, qualifications and experience.
[41] In any event, the applicant received 40 weeks’ redundancy pay and 8 weeks’ notice totalling $129,751.80 - an amount significantly above that prescribed by the Act’s National Employment Standards or any redundancy pay entitlements under the Modern Award.
[42] In the event the Commission found the applicant’s dismissal was not a case of genuine redundancy, the respondent’s submissions also dealt with the matters under ss 387, 390 and 392 of the Act. For reasons which will become clear shortly, I need not set out these submissions at this point.
[43] Mr Robinson submitted that the applicant’s dismissal was not a case of genuine redundancy because:
(a) the applicant’s role still needs to be performed;
(b) the respondent provided the applicant with no particulars of any proposed restructuring of the business;
(c) the respondent did not consult with the applicant about the redundancy and had not engaged in discussions with the applicant as to the nature of the restructure or how he was selected to be made redundant;
(d) the respondent could have reasonably provided the applicant another position within the operation or an associated entity;
(e) the position and duties performed by the applicant are still present, and required to be discharged;
(f) there has been no real dilution of the applicant’s duties amongst other employees of the respondent;
(g) following notification of the alleged redundancy the respondent advertised the applicant’s position, or a position very like it, confirming that the applicant’s role still needs to be performed;
(h) the advertised role essentially replaces that which the applicant had performed; and
(i) while it is understood to be the respondent’s position that the advertised position is not commensurate with that held by the applicant, This position is refuted by the applicant, and it is noted that:
[44] Mr Robinson put that there was no genuine change in the respondent’s operational requirements and this claim was attempted justification for the applicant’s dismissal. He had no information that redeployment opportunities were genuinely considered and he was provided with no information about the nature of the redundancy. The applicant sought the following remedies:
(a) reinstatement, pursuant to s 391 of the Act; and/or
(b) restoration of lost remuneration, pursuant to s 391(3) of Act; or
(c) compensation, pursuant to s 392 of the Act.
[45] Mr Robinson said that there was no evidence that an order of compensation would adversely impact on the respondent. The applicant had been told his position was ‘a job for life’ and he could have reasonably expected to have remained in employment until his retirement. The applicant has been unable to mitigate his loss. The respondent had not asserted any misconduct. The applicant’s loss has been $2,429.67 per week since his dismissal and continues at that rate. He seeks an amount of compensation of $63,171.50.
[46] In oral submissions, Mr Robinson referred to the evidence that the applicant had 6 years’ experience working in the CAP. In addition, Mr Caswell gave evidence that the duties previously performed by the applicant were now performed in the new role. A comparison of the two position descriptions reveals very little difference between them. The applicant did not apply for the new role because he believed it would be a ‘useless exercise’, given his history with Mr Oram.
[47] As to the payment of redundancy, Mr Robinson said that these payments did not arise from any legal or contractual obligation. In calculating compensation, it could be assumed the applicant may have remained employed for 2 years ($250,000). Applying a deduction for contingencies of 20% (say $200,000) and deducting monies already paid leaves a balance of $85,000; reduced to the compensation cap of 26 weeks, the resultant figure is $63,171.50.
[48] In further submissions, the respondent attached the ‘Leaving the Company’ policy applicable at the time of the applicant’s redundancy and the redundancy policy at the time the applicant commenced employment in 2005. The earlier policy provided the applicant with about twice the amount of redundancy pay he would have otherwise received under the current policy.
[49] In relying on Technical and Further Education Commission T/A TAFE NSW v Lynda Pykett [2014] FWCFB 714 (‘Pykett’), Ms Mansini put that determining whether there was a job or position to which an employee could be redeployed requires consideration of:
(a) the nature of any available position;
(b) the qualifications required to perform the job;
(c) the employee’s skills, qualifications and experience; and
(d) the location of the job in relation to the employee’s residence and the remuneration (pay and entitlements) which is offered.
[50] Ms Mansini rejected claims that the new role essentially replaced the applicant’s former role and added:
(a) the new role is predominantly charged with improving the maintenance structure at the GTP and CAP at Botany specifically through identifying and implementing process improvement and cost efficiencies for maintenance across both plants; and
(b) the new role encompasses less than a quarter of the duties previously discharged by the applicant in his former role.
(c) the respondent required the new role to be performed by a candidate with tertiary qualifications and it is not disputed that the applicant does not meet this mandatory prerequisite.
[51] Ms Mansini said that the applicant was not a suitable candidate for the new role because:
(a) he did not have experience performing maintenance activities at the CAP Plant; and
(b) his former role was task orientated and the applicant had not demonstrated in his former role that he had knowledge of world class reliability methods and that he was capable of identifying and implementing process improvement and cost efficiencies for maintenance across both the GTP and the CAP.
[52] It was reasonable and appropriate that the applicant was not assessed as suitable, based on his direct manager’s recommendations, particularly when the manager had no involvement in developing the skill requirements for the new role. Ms Mansini said it was not for the applicant to determine if his experience qualified him for work on the CAP. This was a decision properly made by the respondent. In any event, the new role had been known about for months and the applicant made no application for the job. In addition, the new role is not the same job. It attracts higher remuneration reflecting the changed nature of the position and the higher skills required.
[53] In reply, Mr Robinson emphasised that the applicant’s dismissal was not a case of genuine redundancy because his role still needs to be performed and he could have been reasonably redeployed to another position within the operations of the respondent or an associated entity.
[54] Mr Robinson submitted that the applicant’s evidence about his capacity to discharge the duties of the new role and the fact that he had done so when he worked at the CAP, was not seriously challenged by the respondent. It was not credible that a person who had no experience at the CAP, would have any greater knowledge than he did with 20 years’ experience. Mr Robinson added that the requirement for a tertiary qualification did not impact on the applicant’s capacity to discharge the duties of the new role; see: McIllwraith v Toowong [2012] FWA 9662 (‘McIllwraith’).
[55] Mr Robinson submitted that the respondent’s evidence did not establish that the applicant could not perform the duties of the new role. In fact, the respondent’s submissions had not established that the CAP was a Major Hazard Facility, which was the main reason it claimed the position needed a tertiary-qualified engineer.
[56] Mr Robinson said that the respondent did not consult the applicant about his redundancy. He referred to Mr Caswell’s evidence and submitted that reliance on the line manager was unreasonable because:
(a) Mr Caswell was aware of existing issues between the applicant and his line manager;
(b) in making a determination as to the applicant’s suitability for the role he relied upon the reports of that same line manager;
(c) despite being aware of the issues between the applicant and his line manager he did not discuss the new role or any potential for redeployment with the applicant directly; and
(d) after speaking to the line manager, the applicant was not considered a good candidate for the role.
[57] In addition, there had been no meaningful response to the applicant’s solicitor’s letter of 22 December 2015. The fact the applicant did not apply for the new role is irrelevant. Mr Robinson asserted that the onus under s 389(2) of the Act is on the employer to exhaust all opportunities for redeployment.
[58] Mr Robinson reserved the applicant’s right to put further submissions as to the unfairness of his dismissal and remedy should that become necessary.
[59] It is apparent that the applicant’s case focused on the following propositions:
Obviously, these are direct challenges to the respondent’s submissions in respect to sub-ss (1)(a) and (2) of s 389 of the Act.
[60] In respect to ss (1)(b) of the Act, I do not apprehend that there was any dispute that the applicant’s employment was not covered by an enterprise agreement or Modern Award. Although this might be said to relieve the respondent from consultation with the applicant about his redundancy, it would seem that in any event, the consultation requirement arises from the respondent’s own policies; see: Annexure A. Nevertheless, the respondent maintains it did undertake genuine consultation with the applicant. That said, it is apparent that the gravamen of the applicant’s grievance is that his dismissal was not a case of genuine redundancy, because it would have been reasonable to redeploy him to the new role of Maintenance and Reliability Lead.
[61] Before turning to that specific question, I intend to discuss the meaning of redundancy and redeployment within the context of s 389 of the Act.
[62] Section 389 of the Act expressly defines ‘genuine redundancy’; see: [5] above. The Explanatory Memorandum to the Fair Work Bill 2008 further explained the meaning of ‘genuine redundancy’ as follows:
‘Clause 389 - Meaning of genuine redundancy
1546. This clause sets out what will and will not constitute a genuine redundancy. If a dismissal is a genuine redundancy it will not be an unfair dismissal.
1547. Paragraph 389(1)(a) provides that a person’s dismissal will be a case of genuine redundancy if his or her job was no longer required to be performed by anyone because of changes in the operational requirements of the employer’s enterprise. Enterprise is defined in clause 12 to mean a business, activity, project or undertaking.
1548. The following are possible examples of a change in the operational requirements of an enterprise:
● a machine is now available to do the job performed by the employee;
● the employer’s business is experiencing a downturn and therefore the employer only needs three people to do a particular task or duty instead of five; or
● the employer is restructuring their business to improve efficiency and the tasks done by a particular employee are distributed between several other employees and therefore the person’s job no longer exists.
1549. It is intended that a dismissal will be a case of genuine redundancy even if the changes in the employer’s operational requirements relate only to a part of the employer’s enterprise, as this will still constitute a change to the employer’s enterprise.
1550. Paragraph 389(1)(b) provides that it will not be case of genuine redundancy if an employer does not comply with any relevant obligation in a modern award or enterprise agreement to consult about the redundancy. This does not impose an absolute obligation on an employer to consult about the redundancy but requires the employer to fulfil obligations under an award or agreement if the dismissal is to be considered a genuine redundancy.
1551. Subclause 389(2) provides that a dismissal is not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within the employer’s enterprise, or within the enterprise of an associated entity of the employer (as defined in clause 12).
1552. There may be many reasons why it would not be reasonable for a person to be redeployed. For instance, the employer could be a small business employer where there is no opportunity for redeployment or there may be no positions available for which the employee has suitable qualifications or experience.
1553. Whether a dismissal is a genuine redundancy does not go to the process for selecting individual employees for redundancy. However, if the reason a person is selected for redundancy is one of the prohibited reasons covered by the general protections in Part 3-1 then the person will be able to bring an action under that Part in relation to the dismissal.’
[63] The meaning of the term ‘redundancy’ may vary, depending on the particular industrial context and/or the text of an applicable industrial instrument. In Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241, Gleeson CJ and McHugh J held at [12] that:
‘In the industrial context, redundancy of position is not a concept of clearly defined and inflexible meaning.’
[64] More recently, a Full Bench of this Commission in Construction, Forestry, Mining and Energy Union & Anor v Spotless Facility Services Pty Ltd [2015] FWCFB 1162 said at [66]:
‘The meaning of the word ‘redundancy’ is not fixed and the term will take colour from its context. However, in any relevant context it is the abolition of a position which leads to that position being made redundant. The cause of the abolition of the position – whether business restructure, technological advance, loss of contract/ordinary turnover or otherwise – is a separate matter, albeit one which may determine the entitlements of the redundant employee. …’
[65] The Full Bench of Fair Work Australia (as the Commission then was) in Ulan Coal Mines Limited v Howarth & Ors [2010] FWAFB 3488, after considering relevant authority and the Explanatory Memorandum to the Fair Work Bill 2008, concluded that:
‘[17] It is noted that the reference in the statutory expression is to a person’s “job” no longer being required to be performed. As Ryan J observed in Jones v Department of Energy and Minerals (1995) 60 IR 304 a job involves “a collection of functions, duties and responsibilities entrusted, as part of the scheme of the employees’ organisation, to a particular employee” (at p. 308). His Honour in that case considered a set of circumstances where an employer might rearrange the organisational structure by breaking up the collection of functions, duties and responsibilities attached to a single position and distributing them among the holders of other positions, including newly-created positions. In these circumstances, it was said that:
“What is critical for the purpose of identifying a redundancy is whether the holder of the former position has, after the re-organisation, any duties left to discharge. If there is no longer any function or duty to be performed by that person, his or her position becomes redundant…” (at p.308)
This does not mean that if any aspect of the employee’s duties is still to be performed by somebody, he or she cannot be redundant (see: Dibb v Commissioner of Taxation (2004) FCR 388 at 404-405). The examples given in the Explanatory Memorandum illustrate circumstances where tasks and duties of a particular employee continue to be performed by other employees but nevertheless the “job” of that employee no longer exists.’ [my emphasis]
[66] The Full Bench then held at [19]-[20] that:
‘[19] In the present case, the Commissioner appears not to have drawn an appropriate distinction in his reasoning between “jobs” of the mineworkers who were retrenched and the functions performed by those mineworkers or take proper account of the nature of the restructure at the mine which led to an overall reduction in the size of the non-trades mineworker force. The Company restructured its operations in various ways including by outsourcing certain specialised, ancillary and other work and increasing the proportion of trade-qualified mineworkers in underground development and outbye crews. As a result, it was identified that there were 14 non-trades mineworker positions which were surplus to the Company’s requirements. The mineworkers whose employment was to be terminated were determined according to the seniority principle as provided in the Agreement. This did not mean that the functions or duties previously performed by the retrenched mineworkers were no longer required to be performed. It also did not mean that the positions of some of these mineworkers (e.g. in underground crews) did not continue, although those positions might after the restructure be filled by more senior non-trades mineworkers transferred from other parts of the operations or by trade-qualified mineworkers. However fewer non-trades mineworker jobs were required overall at the mine as a result of the operational changes introduced and, for this reason, the jobs of the 14 mineworkers selected for retrenchment could be said to no longer exist.
[20] These circumstances readily fit within the ordinary meaning and customary usage of the expression in s.389(1)(a) of the Act where a job is no longer required to be performed by anyone because of changes in the operational requirements of the employer’s enterprise.’ [my emphasis]
[67] In Dibb v Commissioner of Taxation (2004) 136 FCR 388 (‘Dibb’) referred to above, the Federal Court said at 404-5:
‘43. The difficulty in this case has been caused by the aphorism which appears in both paras 12 and 42 of TD 94/12 to the effect that the job, not the employee, becomes redundant. However s 27F speaks of the “bona fide redundancy of the taxpayer”. We consider that it is more accurate to say that an employee becomes redundant when his or her job (described by reference to the duties attached to it) is no longer to be performed by any employee of the employer, though this may not be the only circumstance where it could be said that the employee becomes redundant. Reallocation of duties within an organisation will often lead the employer to consider whether an employee, previously employed to perform specific functions assigned to a particular “job”, will be able to perform any available “job” existing after such reallocation. Even if the employee’s job, defined by reference to its duties, has disappeared, he or she may be able to perform some other available job to the satisfaction of the employer. In that case, no question of redundancy arises. It is only if the employer considers that there is no available job for which the employee is suited, and that he or she must therefore be dismissed, that the question of redundancy arises. If, in good faith, the employer:
● Has reallocated duties;
● considers that the employee is not suitable to perform any available job, defined by reference to those reallocated duties, existing after the re-allocation; and
● for that reason, dismisses the employee,
then, for the purposes of s 27F, the employee is dismissed by reason of his or her bona fide redundancy. In the above discussion we have used the word “available” as meaning “vacant”, and the word “suitable” as meaning “within the employee’s capacity”.
44. In the present case, the employer redistributed the duties previously performed by its District Managers and at the same time, added further duties. The job, described by reference to its duties as previously performed by Mr Dibb, ceased to exist. The employer no longer wished to have that job performed by anybody. The work was to be differently distributed. The result was that there was no job for which his skills qualified him. He was “surplus to [AVCO’s] personnel needs”. We consider that the respondent was in error in concluding that Mr Dibb’s dismissal was not by reason of his bona fide redundancy. As a result, the respondent also erred in failing to address the matters prescribed by s 27F. These errors have inevitably deprived Mr Dibb of the benefit conferred by Subdiv AA upon a person receiving a bona fide redundancy payment as part of an ETP.’
[68] In Payne v Lower North Shore 2015 FWC 8145, Johns C said at [25]:
‘The division of duties of one position between other roles such that, in total, all the duties continue to be performed does not mean that the position has not been made redundant. The reorganisation of duties such that the discrete position undertaken by one employee no longer exists (even if all the duties continue to exist) is still considered a redundancy of the discrete role (in this case the position of Individual Transport Manager).’
[69] A consistent theme emerging from the above passages is that one species of redundancy is the employer’s prerogative to rearrange the structure of its business by breaking up the functions, duties and responsibilities of a single position and distributing them among the holders of other positions, including newly-created ones. In these examples, the work required to be performed does not change, but the means by which the work is organised does. However, in this case, I accept the respondent’s evidence that parts of the applicant’s former role (no more than 25%) were incorporated into the new role, but the two roles were essentially very different, because it was a higher-level, more strategic role.
[70] In Ulan Coal Mines Limited v Honeysett & Ors [2010] FWAFB 7578, the Full Bench of Fair Work Australia set out the obligations on an employer in regard to redeployment under s 389(2)(b). At [27]-[28] and [34], the Full Bench said:
‘[27] Secondly, it is implicit in the terms of s.389(2)(b) that it might be reasonable for an employee dismissed by one employer to be redeployed within the establishment of another employer which is an entity associated with the first employer. It follows that an employer cannot succeed in a submission that redeployment would not have been reasonable merely because it would have involved redeployment to an associated entity. Whether such redeployment would have been reasonable will depend on the circumstances. The degree of managerial integration between the different entities is likely to be a relevant consideration.
[28] Thirdly, the question posed by s.389(2), whether redeployment would have been reasonable, is to be applied at the time of the dismissal. If an employee dismissed for redundancy obtains employment within an associated entity of the employer some time after the termination, that fact may be relevant in deciding whether redeployment would have been reasonable. But it is not determinative. The question remains whether redeployment within the employer’s enterprise or the enterprise of an associated entity would have been reasonable at the time of dismissal. In answering that question 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.
…
[34] It may be appropriate to make some concluding remarks about the operation of s.389(2). It is an essential part of the concept of redeployment under s.389(2)(a) that a redundant employee be placed in another job in the employer’s enterprise as an alternative to termination of employment. Of course the job must be suitable, in the sense that the employee should have the skills and competence required to perform it to the required standard either immediately or with a reasonable period of retraining. Other considerations may be relevant such as the location of the job and the remuneration attaching to it. Where an employer decides that, rather than fill a vacancy by redeploying an employee into a suitable job in its own enterprise, it will advertise the vacancy and require the employee to compete with other applicants, it might subsequently be found that the resulting dismissal is not a case of genuine redundancy. This is because it would have been reasonable to redeploy the employee into the vacancy. In such a case the exception in s.385(d) would not apply and the dismissed employee would have the opportunity to have their application for a remedy heard. The outcome of that application would depend upon a number of other considerations.’
[71] In Pykett, a Full Bench of the Commission held:
‘[36] We have earlier set out the submissions of the appellant and the respondent as to the proper construction of s.389(2) (see paragraphs [15] to [18] above). We accept the respondent’s submissions. 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.’
[72] Even if the applicant’s dismissal was found not to be a case of genuine redundancy, and his dismissal was subsequently found to be unfair, it is difficult to imagine what remedy would be available to him to pursue. This is so because the applicant has only identified the one position he believes he should have been offered and that role requires qualifications the applicant simply does not possess. It is not open to the applicant to justify his suitability for the new role based on the fact that his old role had a preference for tertiary qualifications. This assumption entirely ignores my acceptance of the respondent’s evidence that the two roles are significantly different. Moreover, a line-by-line comparison of the two roles to demonstrate similarities between them does not impugn the employer’s decision to pitch the new role at a much higher level of qualification and capacity. The fact the respondent initially had trouble attracting suitable candidates at the rate of pay being offered, only serves to highlight that distinction.
[73] With this in mind, it is understandable that the respondent was unable to find alternative options for redeployment, commensurate with the applicant’s skills, qualifications and experience. Accordingly, if it is accepted the applicant’s former role no longer exists, he cannot be reinstated to his former position and there is no other position to which it would be appropriate to redeploy him to. Even if the applicant’s dismissal was found to be unfair, it seems to me, that reinstatement would be inappropriate. If compensation is the only other remedy, what amount might be ordered, given matters to be considered in s 392(2) of the Act?
[74] The applicant received 8 weeks’ notice and 40 weeks’ redundancy pay. It was argued by Mr Robinson that if compensation was the appropriate remedy under s 392 of the Act, then these amounts should not be taken into account and he should be awarded 26 weeks’ pay in addition to monies already paid. The difficulty with that proposition is explained in this way - if the applicant was found to have not been made genuinely redundant, it is illogical to characterise the payment of 48 weeks’ pay as a payment made in recognition of his redundancy. Putting aside that there may well be adverse tax implications on an amount of redundancy pay which is not for a genuine redundancy, I cannot see how it is possible to ignore what effectively becomes an ex gratia payment on termination, far in excess of the maximum compensation of 26 weeks’ pay available under the Act. Having regard to the overarching principle of ‘a fair go all round’ (s 381 of the Act), and the fact that the applicant has experienced no economic loss at this point, I would likely to be disinclined to make any orders for compensation, pursuant to s 392(2)(g) of the Act. Putting it another way, if the applicant won the jurisdictional question, it would be a Pyrrhic victory indeed, if nothing flowed from a finding of unfairness. In any event, as I have found otherwise, this consideration needs no further development.
[75] At this juncture, I wish to make a few observations about the applicant’s evidence and submissions made by Mr Robinson.
[76] Firstly, I do not accept that an obvious ‘off the cuff’ comment about the duration of the plant’s life being 100 years, supposedly meaning the applicant had a ‘job for life’, assists the applicant’s case. It would be a valiant submission indeed to describe this exchange as a guarantee of lifetime employment. In the contemporary workplace, no employee can have an expectation of employment for life.
[77] Secondly, the applicant claims he was not consulted about the restructure and its effect on him. In my view, that submission is not supported by the evidence. At all relevant times, the applicant was aware of the restructuring imperative of the respondent and, at least since 16 November 2015, he knew of the proposal to amalgamate the two positions in the two plants into one. Otherwise, why would he have his solicitor question the very issues he raises in this case, in the letter of 22 December 2015? I do not accept that there was no meaningful response to the solicitor’s letter. The applicant could have easily engaged with the respondent over the two-and-a-half-month period when he was at work until 31 January 2016. As an aside, I find it a little unusual that the applicant would resort to solicitor’s letters in dealing with the respondent over the question of his redundancy (or indeed, in respect to the 2013 issues he had with allegations against him). It is not usual for employees to engage legal advice in the ordinary course of their employment, although I readily concede he has every right to do so.
[78] Thirdly, while I acknowledge the onus is on the employer to identify any redeployment options for a redundant employee (because such knowledge will usually be within the knowledge of the employer; see: Pykett at [36]), the facts in this case make clear that the only option the applicant felt he should have been offered was the new Maintenance and Reliability Lead role. This new role was well known to both parties. In any event, I accept the evidence of Mr Caswell that genuine attempts were made by the respondent to identify vacant positions within the respondent’s business, commensurate with the applicant’s skills, experience, existing position and status within the Company. Given the specific nature of his former role, that was always going to be somewhat problematic.
[79] Fourthly, while I also acknowledge the onus rests on the employer to offer an employee a redeployment position, the fact was the applicant did not even apply for the new role. It is difficult to accept that he did not do so, because it was a ‘useless exercise’. The question remains – how could he know? If his strong conviction was such that he had the skills and expertise to perform the functions of the new role, in my opinion, he should have made an application for the role. Notwithstanding his perceived views of the relationship with Mr Oram, he may well have convinced others through an independent interview process that he was the appropriate person for the new role. We will never know.
[80] Fifthly, Mr Robinson relied on the decision in McIlwraith. However, the facts in that case, are clearly distinguishable from the facts and circumstances of this case. In McIlwraith, the Commissioner firstly, did not accept that the new role required a tertiary-qualified person, particularly as the advertisement for the role did not identify tertiary qualifications as a requirement. That is not the case here, where the advertisement makes clear that tertiary qualifications are essential; see Annexure B. Moreover, the fact that the salary had to be increased to attract a suitable person, demonstrates the higher-level nature of the position. Secondly, the Commissioner noted in McIllwraith there was no reduction in the number of jobs. The Financial Controller’s position and his duties were replaced by a new Dealership Accountant position. That is obviously not the case here where the two former positions have been absorbed into a single higher-level, more strategically focused role.
[81] In cases such as this, where a former employee argues, in effect, that his redundancy was an excuse to cover some other suspicious reason, I am always drawn to the question that if the applicant’s redundancy was a sham, what was the real reason for his dismissal? The applicant implied that his prickly relationship with Mr Oram and the 2013 allegations against him, which resulted in a final warning, were the likely real reasons for his dismissal. In my view, this is a convenient, but implausible claim. Firstly, there was no cogent evidence of the alleged ‘tension’ in the relationship between the applicant and Mr Oram beyond that of two senior employees, one of which had authority over the other. While Mr Caswell said he was aware of past disagreements between Mr Oram and the applicant, it does not necessarily follow that Mr Oram’s views of the applicant’s suitability for the new role should be disregarded, particularly when a HR representative was also involved in the selection process.
[82] Second, the causal link between the events of 2013 and the applicant’s dismissal on 31 January 2016 is tenuous at best. There was no evidence of any further issues in the two years which followed and before the applicant’s redundancy. The respondent insists that there were no performance or conduct issues which lay behind the applicant’s redundancy or influenced it. I accept that proposition. Moreover, the purpose of providing warnings or counsellings is to effect a change in employee performance or behaviour. In this case, that seems to be the very outcome that the warning achieved. In my view, it is not open to claim some historic issues of behaviour as the real reason for a redundancy, in the absence of cogent and relatively contemporary evidence pointing, on the balance of probabilities, to that conclusion. Indeed, if the real motivation was to get rid of the applicant based by creating a false redundancy, then the respondent might well have done so when he had inquired about redundancy in 2014. At that time, it would have been much cheaper to have agreed to his redundancy.
[83] This leads me thirdly, to observe that it does not make any sense that if the applicant was capable of performing the new role, why the respondent would not have kept him on and saved $124,000 in redundancy pay and the higher salary that was necessary to attract the appropriate candidate. Moreover, if this was a cunning plan to get rid of the applicant – or even a convenient opportunity to do so – it must be said the respondent went to extraordinary lengths to ‘cover its tracks’, remembering there were financial pressures on the respondent which triggered a cost-saving review (Business Review) and a Transformation Plan. It involved the respondent’s operations in Australia and New Zealand and resulted in other roles being made redundant. It simply does not make any sense, let alone business sense, that as a cost-saving measure, a number of people would have conspired in a sham exercise to remove the applicant and pay him $124,000 in redundancy pay. Indeed, the respondent paid him almost double what he would otherwise have been entitled to under the redundancy package legally applying to him at the time, rather than the far more generous package that applied at the time his employment commenced 15 years ago. In any event, there was no serious challenge to the evidence that the effect of the applicant’s redundancy was to save the respondent around $100,000 per annum.
[84] In my view, and in the context of Mr Ng’s resignation, it was reasonable for the respondent to combine the two roles into one more strategically focused, higher-level role while at the same time improving efficiencies and making cost savings. I determine that the applicant’s dismissal was a genuine redundancy.
[85] For the aforementioned reasons, I am satisfied that the applicant’s dismissal was a case of genuine redundancy. The respondent no longer required the role performed by the applicant to be performed by anyone and there was no position to which the applicant could have been reasonably redeployed. To the extent that it is necessary, I consider the process of notification and consultation with the applicant was fair and reasonable.
[86] Accordingly, the applicant is not a person protected from unfair dismissal. The application he has made under s 394 of the Act, must be dismissed. Orders to that effect will be published contemporaneously with this decision.
DEPUTY PRESIDENT
Appearances:
Mr P Robinson, Solicitor for the applicant.
Ms A Mansini with Ms L Carroll for the respondent.
Hearing details:
Sydney.
2016.
June 9.
Annexure A
Redundancy Policy – Australia
This document covers/introduces the following topic/s:
REDUNDANCY POLICY
RESPONSIBILITIES
PACKAGE DETAILS
1. Policy
Redundancy arises where the company has made a definite decision to reduce its staffing by eliminating a position or a number of positions. Redundancy is a measure of last resort. It arises in circumstances other than through the normal and customary evolution of positions, and associated changes in duties and responsibilities. When a position is eliminated the first consideration must be to attempt to find the incumbent a suitable alternate position. Where the company has made a definite decision to reduce its staffing and where it is unable to redeploy an employee to an alternate position the employee will be entitled to severance payments as outlined below.
2. Responsibility
The Business Manager in consultation with the Group General Manager and the Group Personnel Manager.
3. General
Where practicable the company will seek expressions of interest and will consult with persons likely to be affected. The company will not offer voluntary redundancies.
The final decision as to persons who will be made redundant will rest with the company.
The company priority will be to redeploy to an alternate position.
Redundancy does not apply where an employee has refused or accepted an offer of an alternate position within the company, or which the company has arranged with another employer (other than an outside contractor), that is consistent with the employee’s Job Grade/Classification, that is within the skills, qualifications and experience of the employee and which does not submit the employee to unreasonable geographic disadvantage.
All other things being equal, the company shall retain in each area and classification persons of capacity and experience over persons lacking capacity and experience. In the context of a broader organisational restructuring, an incumbent of a remaining position may be made redundant and replaced by an incumbent of an eliminated position.
Where this is being considered the selection process for the available positions must be fair, just and reasonable and based on an objective assessment of the strengths and weaknesses of each employee. The selection criteria and assessment of each employee must be documented. Each employee should be provided with the opportunity to present their views on the merit of them being selected.
As an alternative to redundancy the company may offer an employee a trial period in a position that the company considers is not consistent with their current position. If within 12 weeks from start date in the new position the employee believes the position is not appropriate, or the company believes the employee is not suitable in the new position, the company will either provide a role that is consistent with the employee’s skills, qualifications and experience and with their original Job Grade/Classification, or will provide a redundancy payment.
If the base rate for the new position is less than that which applied to the previous position, an ex-gratia payment shall be made to compensate for the base rate difference for a period of up to six months.
Where practicable adequate advice of impending redundancies will be given to persons likely to be affected. Where an employee is given 8 weeks formal notice of the date on which employment is to be terminated, payment in lieu of notice will not be made. If however the company subsequently curtails this notice period, or provides less than the 8 weeks notice, the balance will be paid out.
It would be inconsistent with the intent of this policy for a person who is made redundant to be offered future work with the company, through employment or by contract, within the period covered by the redundancy payment.
Orica Ltd Australia Redundancy Package details (October 1997 -30th June 2006):
Following are details of the Orica Ltd Australia redundancy package. Other package arrangements may exist for certain sites or categories of employees. A check should be made with HRSS to ensure that employees are paid redundancy benefits in accordance with their particular individual or collective employment contracts
A period of eight weeks notice will be given or payment made in lieu of notice.
severance payment will be calculated on the basis of 4 weeks pay for each year of service pro-rated on a quarterly basis, with the total being not less than 12 weeks and not more than 80 weeks pay.
An employee of Orica Ltd in Australia who in the event of redundancy would have had an accrual at 30 September, 1997 greater than 80 weeks (based on accrual at the rate of 4 weeks per year of service) will have this accrual preserved. This means that if at any time in the future the employee was to be made redundant this accrual would be protected, and the employee would receive the number of weeks which are preserved.
All statutory entitlements including pro rata annual leave and leave loading, and long service leave will be paid on termination. Pro rata Long service leave will be paid after 5 years of service for staff and Fixed Pay employees.
Appropriate assistance with placement outside the company will be offered.
Severance payment will be calculated on base salary. Base salary is that rate which is used for the purposes of calculating superannuation benefits, and overtime pay, but does not include shift loadings.
Years of service includes unbroken service as a full time or part time employee of orica. Entitlements are calculated on a pro-rata basis for the period of time spent working part time. It does not include periods of unpaid or parental leave of one month or more, service as a casual employee or service as a contractor to Orica.
External study Scheme: All admissible education costs incurred for the current academic year will be paid upon presentation of receipts. In these circumstances, it will not be necessary for the employee to produce evidence of successful completion of subjects. (All claims for expenses should be finalised with the employee prior to his/her departure from the company).
The provisions of this policy do not apply to Orica executives on fixed pay employment contracts.
ENGAGEMENT OF ORICA REDUNDANT EMPLOYEES THROUGH AGENCIES
Recruitment of Ex-Employees:
The Group Human Resource Manager in conjunction with the Tax Section, Corporate Finance Unit must be consulted before an offer of re-employment is made on either a full-time, part-time or casual basis.
Engagement of Orica Redundant Employees through Agencies:
For the period of time covered by a redundancy payment, an employee shall not come back to Orica in any way, shape or form e.g. if an employee has been paid 20 weeks redundancy pay, they shall not be engaged through an agency at Orica during that 20 weeks period. There will be cases of exception i.e. appropriate skills etc but all appointments need to be agreed by the business HR Manager.
Annexure B
Printed by authority of the Commonwealth Government Printer
<Price code G, PR584260>