| [2017] FWC 4409 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Mr Muhammad Buttar
v
PFD Food Services Pty Ltd T/A PFD Food Services
(U2017/6700)
DEPUTY PRESIDENT ANDERSON |
ADELAIDE, 24 AUGUST 2017 |
Application for an unfair dismissal remedy - jurisdictional objection raised – failure to consult – failure to reasonably consider redeployment - not genuine redundancy – dismissal harsh, unjust or unreasonable despite valid reason – conciliation on question of remedy
[1] Mr Muhammad Buttar has applied to the Fair Work Commission (the Commission) under section 394 of the Fair Work Act 2009 (the FW Act) for an unfair dismissal remedy in relation to his dismissal by PFD Food Services Pty Ltd (PFD). He was made redundant on 2 June 2017.
[2] PFD is a national food processing and distribution company. Seafood processing and distribution is a significant but not exclusive part of its business. It operates a seafood processing site in suburban Torrensville known as the Adelaide Fish Room.
[3] Mr Buttar was born and educated in Pakistan. He holds tertiary qualifications from Pakistan in finance and in computing. They are not mutually recognised in Australia. He has a technical Australian qualification to drive fork lifts. He migrated to Australia in about 2014. He is 32 years of age. He commenced working for PFD in the Adelaide Fish Room as a filleter/general hand in February 2015. He worked continuously with PFD for 2 years 4 months.
[4] Mr Buttar was a well-regarded and conscientious employee. He was promoted to Production Supervisor in the Adelaide Fish Room in September 2015. On 7 April he entered a new employment contract with PFD when PFD decided to employ Production Supervisors on an all-up salary. Aside from an increase in pay, his work responsibilities and employment conditions remained unchanged. Relevantly, at all times, including after the change in remuneration structure, he remained employed under the terms of a modern award, the Seafood Processing Award 2010.
[5] At the time of his termination he was one of two Production Supervisors in the Adelaide Fish Room. He generally worked afternoon shift, the other Production Supervisor (Jim Galios) the day shift. He reported directly to Production Manager David Harker, who in turn reported to the National Seafood Operations Manager Winston Chiu.
[6] As Production Supervisor Mr Buttar oversaw the work of production staff (general hands, filliters and packers), processed orders, managed stock flows and inventories, dealt with sales staff, checked weights, measures and freezer temperatures and locked the factory at close. He used his computer skills to manage and record data, and used his production and forklift driving skills to support production and operations where needed.
[7] Mr Buttar’s application was lodged within the statutorily required 21 days after his dismissal took effect.
[8] Mr Buttar seeks a finding that his dismissal was unfair within the meaning of the FW Act, and an order for reinstatement accompanied by ancillary orders for the payment of back pay and recognition of continuing employment.
[9] PFD raised a jurisdictional issue. It contends that Mr Buttar’s dismissal was a genuine redundancy. It claims that Mr Buttar could not have been unfairly dismissed given the provisions of section 385(d) of the FW Act. In the alternative, it contends that the dismissal was not harsh, unjust or unreasonable. It opposes any remedy, and in particular an order for reinstatement.
[10] Conciliation by the Commission has not occurred as PFD have asked for the jurisdictional issue to first be determined.
[11] I agreed to determine the jurisdictional issue as a threshold matter. However, in the interest of the efficient conduct of proceedings, at the hearing on 15 and 22 August 2017 I took evidence on the jurisdictional issue, merits and remedy. At the hearing’s conclusion, I reserved my decision.
[12] No parties sought external legal or paid representation. Mr Buttar was self-represented. PFD was represented by its National Employee Relations Manager, Mr Cruse.
[13] Three issues arise for decision: first, was Mr Buttar’s dismissal a genuine redundancy within the meaning of the FW Act; second, if not, was the dismissal unfair within the meaning of the FW Act (that is, was it “harsh, unjust or unreasonable” having regard to the factors in s. 387); and third, if so, what is the appropriate remedy?
[14] It was common ground between the parties that Mr Buttar was a person protected from unfair dismissal under the FW Act (section 382) in that he had served the statutory minimum employment period (6 months) and a modern award applied to his employment. It was also common ground that the dismissal was not governed by the Small Business Fair Dismissal Code (section 385(c)). On the evidence, I am satisfied this is correct.
[15] Under the FW Act, a dismissal is not an “unfair dismissal” if it is a “genuine redundancy” (s. 385(d)).
[16] Section 389 of the FW Act provides the following a statutory definition of genuine redundancy for the purposes of unfair dismissal protections:
“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.”
[17] I am required to consider Mr Buttar’s circumstances in the context of this definition.
[18] Having raised the jurisdictional issue, PFD bears the onus of establishing that Mr Buttar’s dismissal was a “genuine redundancy”. 1
[19] The legal principles governing the application of section 389 are well established. Of relevance to this matter are the following:
1. An employee may still be genuinely made redundant when there are aspects of the employee’s duties still being performed by other employees.2 The test is whether the previous job has survived a restructuring or downsizing, rather than a question as to whether the duties have survived in some form3;
2. Reference to “operational requirements” in section 389(1)(a) includes circumstances where an employer restructures their business to improve efficiency and redistributes tasks done by a particular person between several other employees, resulting in the person’s job no longer existing4;
3. Consultation should not be perfunctory advice on what is about to happen. It should provide the individual with a real opportunity to influence the decision maker.5 However, it is relevant to consider if consultation was highly unlikely to have negated the operational reasons for the dismissal or lead to any other substantive change6;
4. Whether redeployment is reasonable will depend on the circumstances existing at the time of dismissal and will include whether a job or position existed to which the employee could be redeployed, as well as the employee’s qualifications, skills and experience to do the job.7
[20] Two witnesses gave evidence. Mr Buttar for himself and PFD’s General Manager for South Australia and the Northern Territory, Mr Vic DeCasto.
[21] Mr Buttar gave evidence in an open and calm manner. He had good recall. He was measured and precise on matters of detail. He was respectful and polite. Overall, he was an impressive witness.
[22] Mr DeCasto presented his evidence in a business-like manner. He was however frustrated at having his decision-making placed under scrutiny. He became irritable, argumentative and defensive under cross examination. His evidence was more generalised and less precise than Mr Buttar. On occasions he was rude and dismissive of the cross examiner (Mr Buttar) including assertions he did not recall even before a question had been fully asked or considered. At times his answers were appended by sarcasm. 8 He was reluctant to concede ground beyond the company’s stated position. This coloured my impression of his evidence and the extent to which I am persuaded by it.
[23] I similarly find aspects of Mr DeCasto’s written material less reliable than he contended. For example, his supplementary witness statement 9 attaches a typed record of a meeting he had with Mr Butttar on 29 May. His oral evidence was that he typed this document on the evening of 29 May from handwritten notes he took during the meeting. However, the typed record makes reference to views he formed after completing a skills matrix. His oral evidence, which I accept, was that he did not complete the skills matrix until 1 June. I am thus not satisfied that the typed record of meetings in R2 are accurate versions of the discarded handwritten records. They include ex post facto views and opinions.
[24] Where there is a clash of versions, I generally prefer the evidence of Mr Buttar. However, I draw my own inferences and conclusions from the facts. A number of propositions which Mr Buttar advanced in the witness box and in submissions were not evidence of facts but inferences and conclusions he believes should be drawn from his narrative. In this decision, I draw my own conclusions and inferences from agreed or contested facts, not necessarily those advocated by either party.
[25] PFD’s claim of genuine redundancy concerns a business restructure of the Adelaide Fish Room decided by Mr DeCasto in May 2017. I make the following findings:
1. In January 2017 Mr DeCasto became aware of senior management concern that the Adelaide Fishroom was experiencing a serious downturn in business compared to the previous year. He was required to implement strategies to lift its performance and profitability;
2. In early 2017 Mr DeCasto attempted to lift performance by increasing sales and promotional activity. In April 2017 Mr DeCasto concluded that that this was not having the desired effect, and that he would need to respond by reducing operating costs;
3. In May 2017 Mr DeCasto decided that action would need to be taken sooner than later to reduce labour costs. Problems had occurred with two significant supply contracts (Huon and Tassal) which were compounding the situation;
4. Mr DeCasto decided to reduce labour costs in the Adelaide Fish Room by making three non-production roles redundant. These were Mr Buttar’s position as Production Supervisor, the other Production Supervisor (Mr Galios) and their manager the Production Manager, Mr Harker. He also decided to make another employee redundant, Karan Bedi (State Procurement Manager) who worked from a different location. In addition, he reduced some hours of casual staff in his areas of responsibility. Mr Goodes (an existing employee) assumed additional responsibilities and became titled ‘Seafood Manager’. Mr Jie and Mr Galib were promoted from production work to two new positions called ‘Leadership Team’. Over the previous six months, Mr DeCasto had formed the view that these two were employees capable of taking on additional responsibility.
[26] Mr Buttar contends that the redundancy was a sham and designed to get rid of him, Mr Galios and Mr Harker because suspicion had arisen that someone in the Fish Room had taken fish stock without authorisation. He says managers and supervisors were made responsible even if they had done no wrong. In essence, he believes he was the victim of collective punishment.
[27] Mr Buttar claims that his job as ‘Production Supervisor’ still exists. He says it was retitled as ‘Leadership Position’ and is now being performed by Mr Jie, a production worker he formerly trained. He says that new employees have been employed in the Fish Room since the redundancy to backfill those now doing his job. He says that Mr Jie is a personal friend of Mr Chiu (the National Seafood Operations Manager) and has been shown favouritism at his expense.
[28] Mr Buttar also disputes that the Fish Room was performing poorly or suffering financial losses. He says seafood is a seasonal industry and the post-Easter period is typically slower. He says managers wrote to him in the second half of 2016 advising that whilst salaries would not be increased the business had been performing well. He says employing new staff since his dismissal is inconsistent with the stated reason of reducing labour costs.
[29] Mr DeCasto gave evidence that the decision to reduce labour costs was real and that the decision to remove three positions at the managerial or supervisory level in the Fish Room was based on the need to reduce costs without adversely impacting production. He said that the work of Mr Buttar had been spread amongst multiple roles, and that the two employees moved into Leadership Positions were doing different jobs. He said that the roles those employees previously performed had not been replaced but that the seasonal nature of the industry and commercial demand or staff absences meant that some positions had and would progressively need to be filled. He said that the controversy over the missing stock had nothing to do with the restructure and that the issue had been blown out of all proportion by Mr Buttar and the other redundant employees.
[30] I am satisfied that there were genuine business reasons associated with a downturn in profitability and performance of the Adelaide Fish Room which led Mr DeCasto to design and implement a restructure resulting in Mr Buttar’s dismissal. Mr DeCasto’s evidence, which was not controverted, was that in the months leading up to the redundancies the Adelaide Fish Room experienced a substantial decline in turnover compared to previous years and was incurring monthly losses. I am satisfied this was the subject of discussion with senior management and that Mr DeCasto was required to take steps to improve the position.
[31] I accept there is considerable overlap between the newly created ‘Leadership Team’ positions (including that of Mr Jie) and the former ‘Production Supervisor’ role undertaken by Mr Buttar. I note that Mr Jie’s position title ‘Leadership Team’ is more in the nature of a designation than a position description. It says nothing about the substance of work being performed. It creates a sense of doubt about its true meaning that warrants deeper inquiry.
[32] I find it more probable than not that at least two-thirds of Mr Buttar’s job is now being performed by Mr Jie. However, in a relatively confined production facility this is not to be unexpected. Oversight of production staff, checking of systems and equipment and factory opening and closure continues to be required. Mr Buttar undertook some broader roles which, at least immediately after the redundancy, were not performed by Mr Jie. For example, he used his computing skills to assist administrative tasks and record keeping. He used his forklift driving qualifications. In the initial weeks after the redundancy a forklift driver needed to be brought on site from another location as neither Mr Jie nor Mr Galib were qualified. Although the evidence suggests they subsequently acquired that qualification, at the time of redundancy they could not perform that aspect of Mr Buttar’s work.
[33] On balance, I am satisfied on the evidence of the labour force structure of the Adelaide Fish Room before and after the redundancies that the role of Production Supervisor, both in terms of title and substance as a dedicated position, no longer exists. Large components of Mr Buttar’s duties were allocated to Mr Jie but there are also aspects of his duties now being performed by staff such as Ms Kubik and Mr Dunning.
[34] I am further satisfied that while Mr DeCasto was understandably concerned about the unexplained stock losses, he was not able to determine how they had occurred. His restructure for operational reasons was unrelated to these concerns. His evidence and that of Mr Buttar, which I accept, was that Mr DeCasto specifically assured Mr Buttar that he (Mr Buttar) was not under suspicion. I accept Mr Buttar’s evidence that Mr DeCasto told him this in a brief phone conversation on 26 May and repeated it on 29 May.
[35] I do not find that the redundancy was a sham. It was a business restructure for genuine operational reasons.
[36] The timing of Mr DeCasto’s decision to make Mr Buttar redundant, and the manner in which Mr Buttar came to be informed of his redundancy were the subject of considerable evidence before me. I make the following findings.
[37] On 29 May Mr Buttar met Mr DeCasto in Mr DeCasto’s office. Mr DeCasto had formed the view over the previous week that Mr Buttar, Mr Galios and Mr Harker were likely to be made redundant. He had received authorisation from the company Chief Executive to restructure in that manner. He had not made a final decision but wanted to meet each separately on Monday 29 May to prepare them for that likelihood. Unknown to Mr DeCasto, Mr Buttar had spent the weekend concerned at a suggestion he had heard from Mr Harker that Mr DeCasto had raised the prospect of a police investigation into the missing stock. Mr Buttar decided to meet Mr DeCasto first thing on 29 May to assert his innocence. When Mr Buttar turned up at Mr DeCasto’s office on the Monday morning he (Mr DeCasto) thought Mr Buttar was attending at Mr DeCasto’s initiative when in fact, Mr Buttar was there of his own volition to discuss the missing stock. The meeting commenced with both at cross-purposes.
[38] Mr DeCasto became frustrated soon after the meeting commenced. He told Mr Buttar that he was not under suspicion for the missing stock and that the police were not being called. However, Mr Buttar persisted in explaining the stock reports he had prepared, and asserting his innocence. I accept Mr Buttar’s evidence in preference to Mr DeCasto’s evidence that most of the meeting concerned the missing stock. However, I find that in the concluding part of the meeting Mr DeCasto told Mr Buttar that there was a restructure likely to occur and that Mr Buttar may be affected. No details of the restructure were provided nor of how it may affect Mr Buttar. Mr Buttar told Mr DeCasto that he would be prepared to work in many different roles if need be. The topic of the restructure was a short conversation lasting no more than 2 or 3 minutes.
[39] In his evidence, Mr DeCasto said that he became so frustrated with Mr Buttar’s presentation at the 29 May meeting, that he effectively decided at the end of the meeting that he would definitely make Mr Buttar redundant. I accept this evidence. However, I find that Mr DeCasto’s frustration with Mr Buttar on 29 May was entirely unreasonable, and that his decision that Mr Buttar deserved to be made redundant was impulsive and insensitive. Mr Buttar was entitled to be concerned at any suggestion he could be caught up in a police investigation and was protective over his honour and integrity. He had nowhere to go but to speak to Mr DeCasto who was his regional manager given that his immediate manager (Mr Harker) was under that same cloud. While the meeting started at cross purposes, Mr DeCasto’s decision to make Mr Buttar redundant on impulse was extreme and unwarranted. I find that it clouded the remainder of Mr DeCasto’s assessment of Mr Buttar’s employment over the course of the week. It gave Mr Buttar little chance of having Mr DeCasto fairly consider redeployment options.
[40] Mr Buttar heard nothing more about the restructure until called to a meeting by Mr DeCasto on Friday 2 June. Unlike the meetings on 29 May which were held with each (to be redundant) employee separately, the 2 June meeting included all three employees and Mr DeCasto (plus another manager). Mr Buttar was handed a letter advising he was redundant, effective immediately – as were Mr Galios and Mr Harker.
[41] Mr DeCasto’s evidence was that he wanted the employees to calmly read the letter, think about their position and then raise questions in a courteous manner. As it turned out, Mr Galios and Mr Buttar both questioned Mr DeCasto and expressed negative views. Mr Buttar told Mr DeCasto that he thought the dismissal unfair and that he could perform other roles. Mr DeCasto’s evidence was that he took exception to having his decision questioned and considered the response of Mr Buttar and Mr Galios “menacing” and “threatening”. I accept this is what Mr DeCasto thought at the time. I find that response was entirely unreasonable. Under cross examination Mr DeCasto conceded it was Mr Galios, not Mr Buttar, who spoke rudely to him. Yet he grouped Mr Buttar with that same brush. He could have avoided this error had he spoken to each employee individually, but he chose not to. Mr DeCasto was naive to expect employees in these circumstances to just go quietly. He was making people redundant, terminating their employment on the spot through no fault of their own and without notice. Mr Buttar was fighting for his job: no more, no less. As it was, Mr Buttar expressed his disagreement but did not become abusive or threatening. He left the workplace respectfully, tidying his desk and saying goodbyes to fellow workers.
[42] I find that Mr DeCasto did not consult in any meaningful way with Mr Buttar about his decision to make him redundant, either on 29 May or on 2 June. There was nothing to prevent Mr DeCasto doing so on either of these days, or at any time in that week.
[43] Clause 8 of the Seafood Processing Award 2010 imposes a requirement on an employer to consult with an employee concerning major change that is likely to have significant effects on their employment. It compels an employer to discuss with the employees the introduction of the changes and take efforts to mitigate adverse impacts. The discussions must be as early as practicable after a definite decision is made. Clause 8.1(b)(ii) requires the employer to provide in writing to the employees all relevant information about the changes and their effects.
[44] I find that Mr DeCasto failed to consult Mr Buttar at all, let alone consult within the meaning of clause 8 of the Award. I reject PFD’s submission that the 29 May meeting was a consultation. At its highest, that discussion simply put Mr Buttar on notice that there may be a restructure in the near term and that it may affect him. The non-specific nature of the information conveyed by Mr DeCasto meant that Mr Buttar was entitled to form the view that the unspecified restructure may affect him positively or equally not affect him at all. He believed on reasonable grounds that he could just get on with his job without concern for his job security, which he did. In no sense did PFD provide Mr Buttar “a real opportunity to influence the decision maker” 10.
[45] Section 398(1)(b) of the FW Act imposes a mandatory requirement on an employer to comply with any obligation in a modern award to consult with an employee about a redundancy. This obligation applied to PFD with respect to Mr Buttar’s redundancy. PFD failed to meet that obligation. Accordingly, irrespective of the issue of redeployment, Mr Buttar’s redundancy failed to meet the statutory requirement of consultation and cannot be a “genuine redundancy” within the meaning of the FW Act.
[46] The FW Act provides that Mr Buttar’s dismissal would not be a case of genuine redundancy if it would have been reasonable in all the circumstances for him to have been redeployed by PFD elsewhere in the enterprise or in an associated entity.
[47] PFD is a significant food processing and distribution company with South Australian operations beyond the Adelaide Fish Room, and with operations interstate.
[48] It is not disputed that during the brief conversation on 29 May between Mr Buttar and Mr DeCasto that Mr Buttar said that he would be prepared to work in a variety of tasks for the employer. I accept Mr Buttar’s evidence that in his mind he was referencing an earlier discussion with Mr Chiu in which it had been suggested to him that he may need to assume additional responsibilities from an administrative staff member. I do not accept Mr DeCasto’s further evidence that Mr Buttar then expressed indifference to being made redundant and proclaimed that he did not need work from PFD and that he could get a job anywhere else. I prefer Mr Buttar’s version of that discussion.
[49] In any event, the legal obligation on PFD was to explore the potential for redeployment.
[50] I accept that Mr DeCasto completed a ‘Skills Matrix’ on 1 June 2017 to assess Mr Buttar’s capability for alternate roles. In the circumstances of this matter, I do not find that completing this matrix was an adequate or sufficient mechanism to discharge the statutory obligation to take reasonable steps to explore redeployment. It was a rushed job and Mr DeCasto did not seriously want to redeploy Mr Buttar. He wanted to save labour costs by having him out of the business. The Matrix only assessed capabilities, not alternate roles. It was unilaterally completed by Mr DeCasto. Mr Buttar was given no opportunity to provide input into what he considered to be his adaptable skill set.
[51] The Matrix was completed by Mr DeCasto on 1 June (the day before the redundancy letters were given to the three employees on 2 June) and the day after the letters were prepared for signature by the human resources department (31 May). Mr DeCasto had already decided to make Mr Buttar redundant, considered that he had no future in the business, and had unreasonably formed a negative attitude towards him by concluding that he had acted in a “menacing” manner on 29 May. I find that Mr DeCasto only gave fleeting thought to other roles, and dismissed them in his mind quickly. No other persons in the business in South Australia or elsewhere were spoken to about whether they had actual roles on offer that Mr Buttar could fill, or whether they were interested in employing him.
[52] As it turned out, in the months following his redundancy there were multiple positions advertised publicly for jobs in PFD, some of which Mr Buttar expressed interest in. Mr DeCasto’s evidence was that he did not believe any of these positions were vacant at the date of redundancy. I make no finding in this regard. Mr DeCasto’s evidence was too generalised for me to be satisfied on the balance of probabilities that this was so.
[53] I find that PFD did not take all reasonable steps to redeploy Mr Buttar in the employer’s enterprise.
[54] Accordingly, I find that Mr Buttar’s dismissal was not a genuine redundancy on the ground that the consultation requirement of the FW Act (section 389(1)(b)) and also the redeployment provision of the FW Act (section 389(2)) were not complied with.
[55] Having made this finding, I am required to consider whether Mr Buttar’s dismissal was “harsh, unjust or unreasonable”. I now consider each of the factors required to be taken into account by section 387 of the FW Act.
[56] The reason for Mr Buttar’s dismissal was redundancy. I have found that there were genuine operational reasons for the business restructure in the Adelaide Fish Room. I have found that Mr Buttar’s redundancy was not a sham. I have found that his redundancy was not a ruse for collective punishment because fish stock had gone missing. There was a valid reason for dismissal.
[57] I have found that Mr Buttar was only notified he was being made redundant on the day when the redundancy took effect. The notification and implementation occurred at the same time. He had no prior notice. I do not accept the brief and non-specific nature of the discussion on 29 May to have been any form of consultation or notice.
[58] I find that Mr Buttar was notified of his dismissal, but only at the last moment before it was implemented and when he was required to leave his employment.
[59] The notification of dismissal on 2 June was impersonal and abrupt. Mr Buttar was never spoken to on a one to one basis by Mr DeCasto or any other manager about the decision to make him redundant. On 2 June he was grouped with the other two employees being made redundant and called into a meeting with Mr DeCasto. Mr DeCasto showed little interest in accommodating Mr Buttar’s individual circumstances or taking into account his feelings and feedback. In this case, expecting Mr Buttar to discuss his individual circumstances in front of other employees being made redundant was not reasonable management action. Mr DeCasto gave Mr Buttar no effective forum to respond either before the decision to make him redundant was made, or after the decision was made but before it was implemented, or when it was communicated and implemented. PFD had the opportunity at each of these stages to speak to Mr Buttar and ascertain his views on the redundancy, on potential redeployment, on his suitability for other roles, on whether he would seek a reference and from whom, on his redundancy pay-out or any other legitimate issues a redundant employee may wish to raise with their employer. It failed to do so.
[60] It was clear from Mr Buttar’s evidence and submissions, as well as his cross examination of Mr DeCasto, that these very matters were on his mind at the time and have continued until the hearing. It is unfortunate to say the least that the first real opportunity Mr Buttar had to ask questions of Mr DeCasto about these matters and put his views and feelings to Mr DeCasto was at the hearing when cross examining his former employer.
[61] The failure to provide Mr Buttar an opportunity to respond was a serious failure of human resources and procedural fairness.
[62] PFD did not refuse Mr Buttar a support person, reasonably or unreasonably. Mr Buttar did not request a support person. I accept the evidence and submissions of Mr Buttar that he did not request a support person because he was not given prior notice that either the meeting on 29 May or the dismissal meeting on 2 June would be discussing his future job security. In the absence of effective prior notice about the nature of these meetings, it was understandable that Mr Buttar did not make a request. I further accept his evidence and submissions that he would have considered making the request had he been given prior notice.
[63] PFD’s failure to consult about the redundancy or provide prior notice of the redundancy meeting effectively deprived Mr Buttar the opportunity to have a support person.
[64] I accept the evidence of Mr DeCasto that Mr Buttar was not dismissed on performance grounds. He was made redundant. Mr DeCasto specifically mentioned this to Mr Buttar at the 2 June meeting. The absence of warnings concerning performance is not a relevant factor in this matter.
[65] PFD is a significant national employer. It employs over 2,800 employees. It operates multiple sites in South Australia. It operates production and distribution facilities in other States and Territories.
[66] The size and capacity of a large employing enterprise means that there is a greater likelihood that positions may fall vacant, compared to a small business. In assessing whether it is reasonable for an employer to redeploy a redundant employee, the obligation is on the employer to take reasonable steps to explore redeployment options in the business as a whole. The FW Act extends this to not only the employing enterprise but also associated entities.
[67] One purpose of the statutory consultation requirement in modern awards is to ascertain the feasibility of alternatives and the willingness or otherwise of the employee to relocate to where job vacancies may exist. This dialogue did not occur in the case of Mr Buttar’s redundancy. He was not asked whether he would be prepared to work elsewhere than Adelaide. I accept Mr DeCasto’s evidence that he did consider roles beyond the Adelaide Fish Room. To this extent, Mr DeCasto contemplated, however fleetingly, whether other operations under his responsibility could accommodate Mr Buttar. However, the size of PFD’s business presented Mr DeCasto and the Human Resources department an opportunity to investigate a broader range of alternatives. They did not take up that option. In failing to do so they failed to use the size of their business to potentially mitigate the effect of Mr Buttar’s redundancy.
[68] PFD has a dedicated Human Resource division and capability.
[69] Mr DeCasto had access to PFD’s Human Resources division at all relevant times. I accept his evidence that he accessed those services and advice. The termination letter was drafted by the Human Resources division on 31 May, two days before dismissal. An estimate of Mr Buttar’s redundancy pay-out was made by human resources and payroll on 31 May. Human resources advised Mr DeCasto to conduct the Skills Matrix, which he did on 1 June. I accept that Mr DeCasto was endeavouring to implement the human resources advice he received in circumstances where redundancies were not common and he was not experienced in implementing redundancies. None of that however explains or excuses the deficiencies in the consultation and implementation process that I have found.
[70] I note Mr Buttar’s evidence and submission that he considers his redundancy to have been unfair because he was not spoken to by PFD’s human resources division and that his termination letter of 2 June was not countersigned by a human resources manager. I do not accept this submission. While it may be the case that the decision to employ Mr Buttar and the decision to make him a Production Supervisor or restructure his salary package had visible and active human resource involvement, it is a matter for an employer to decide who and how in their business a redundancy will be decided, implemented and communicated. Whether a human resource executive is visibly involved or has direct interface with the redundant employee is generally not an issue of fairness or unfairness. So long as the decision maker had requisite authority, the Commission, in exercising is discretion, is concerned to examine the activities of the persons who made and communicated the relevant decisions, not their designations. I am satisfied that Mr DeCasto had the authority to make the decision he made to dismiss Mr Buttar, and to communicate that decision.
[71] I consider the existence of an active and resourced human resources division to weigh against the employer’s case. The deficiencies in consultation and implementation were avoidable, and made more avoidable by the presence of a human resources capability supporting Mr DeCasto.
Other matters (section 387(h))
[72] Mr DeCasto gave evidence that his responsibility was to consider the interests of all employees in the Adelaide Fish Room, not just those that were made redundant. 11 PFD’s submission was that in assessing the employer’s conduct perspective needed to be given to the overall circumstances.
[73] I accept that an employer in Mr DeCasto’s position needed to consider matters beyond the interests of Mr Buttar, including the need to not damage production capacity, deliver on its commercial contracts and minimise the number of persons impacted by his restructure. However, consideration of these broader interests and the obligation to not act in a harsh, unjust or unreasonable manner when dismissing an individual employee are not mutually exclusive. In considering factors such as whether a valid reason existed and the steps taken by PFD to implement its decision to dismiss I have objectively considered all relevant factors, including relevant evidence of considerations taken into account by Mr DeCasto or occupying his mind. Ultimately applications of this nature are of an individual character and the circumstances of both the business as a whole and the individual are brought into focus. I do not consider that any broader considerations operating on Mr DeCasto explained or excused PFD’s failure to consult or take reasonable steps to consider redeployment.
[74] There are no other matters arising from the evidence that are relevant, beyond those already considered.
[75] I have found that the dismissal was not a genuine redundancy within the meaning of the FW Act.
[76] For the abovementioned reasons I find that in all the circumstances the dismissal was harsh, unjust or unreasonable notwithstanding there being a valid reason. The nature of the failure to consult and the failure to give reasonable consideration to redeployment were sufficiently serious to lead me to conclude that PFD’s actions denied Mr Buttar “a fair go all round” 12.
[77] In these circumstances, the only matter that remains to be determined is the issue of remedy.
[78] Mr Buttar seeks an order for reinstatement to his former position accompanied by an order to restore lost pay and to maintain continuity of service. In the alternative, he asks me to order that he be re-employed by PFD in another position suitable to his skills on terms and conditions no less favourable. He says that he is confident he can restore relations with the employer and fellow workers, and holds no personal animus towards Mr DeCasto. In the further alternative but as a less preferred position, he asks me to order the maximum level of compensation, being six month’s pay.
[79] PFD opposes any remedy, and in particular an order for reinstatement. It says Mr Buttar’s former job no longer exists. It says that the employment relationship has been irretrievably broken. On the issue of compensation it says that Mr Buttar has not provided sufficient evidence of financial loss and that compensation should be discounted by earnings since dismissal.
[80] I have taken evidence relevant to the issue of remedy. However, I note that the parties have not undertaken a process of conciliation of Mr Buttar’s application given that PFD exercised its right not to participate in telephone conciliation by a Commission appointed conciliator until the jurisdictional issue was determined. I have now determined that issue, and proceeded to determine the merits.
[81] In these circumstances, I consider it appropriate to defer making a decision on remedy in order to enable the parties to consider, in light of this decision, whether they wish to avail themselves of a conciliation process that could lead to a settlement on the question of remedy. The Commission will make available to the parties, if they so choose, a further process of member-assisted conciliation conducted by a member of the Commission other than myself. Should that process not be undertaken or not successful, I will make a decision on remedy and issue appropriate orders.
[82] This matter will be re-listed for a directions hearing to ascertain the views of the parties on Member Assisted Conciliation.
DEPUTY PRESIDENT
Appearances:
Mr M. Buttar, on his own behalf.
Mr W. Cruse, for the Respondent.
Hearing details:
2017.
Adelaide.
15 and 22 August.
1 Kieselbach v Amity Group Pty Ltd PR973864 at [34]
2 Dibb v Commissioner of Taxation (2004) 136 FCR 388 at 404-405
3 Kekeris v A Hartrodt Australia Pty ltd [2010] FWA 674 at [27]
4 Mackay Taxi Holdings Ltd v Wilson (2014) 240 IR 409 at [43]
5 CEPU v Vodaphone Network Pty Ltd PR911257 at [25]
6 Mawson v Escada Textilvertrieb [2011] FWA 4339 at [39]
7 Ulan Coal Mines v Honeysett (2010) 199 IR 363 at [28]
8 For example, Transcript 10.47am, 22 August 2017; Transcript 11.28am, 22 August 2017
9 Exhibit R2
10 CEPU v Vodaphone Network Pty Ltd PR911257 at [25]
11 Transcript 12.08pm, 22 August 2017
12 Section 381(2) FW Act
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