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Fair Work Act – Section 389 (consultation cases)

[2014] FWC 988 Qld Stewart v Amcor Excavations (the A, a labour hire employee, was placed with a client who no longer wanted himA was surplus to R’s needs. “The Applicant’s skill profile was not in demand at any other site, it was powerless to return the Applicant to the original client and its work site, and the Employer at the same time was reducing its employment levels significantly in other areas in which it had direct employees” @46 – R “no longer required the Applicant’s job to be performed by anyone because of changes in the operational requirements of the Employer’s enterprise, as it is broadly conceived” @47 – R claimed that the decision to make A redundant could not be regarded as a ‘major change’ under the relevant Modern Award’s consultation provision arguing “that the redundancy of a single employee alone does not constitute a major change” @19 – the plural ‘employees’ was used in the award, but such held not to negate the application of the award to one employee – R also argued that a “major change is ‘where an employer has made a definite decision to introduce major changes in production, program, organisation, structure or technology” @26 – according to R, “there was no decision taken by the Employer to introduce a major change that had any significant effects. The Employer encountered a set of circumstances imposed upon it by an external event, and responded at a discrete level, but this could not amount to a major change of the type the consultation clause envisages” @31 – held that consultation provisions in modern awards (from which small businesses are not excluded) are – in their standardised origins – intended to capture redundancies however they might arise and on whatever scale (despite the conditionality expressed by the adjectives in the phrases ‘major change’ and ‘significant effects’” @42 – R failed to comply with consultation provisions of applicable modern award – dismissal found)

[2014] FWC 9311 WA MacLeod v Alcyone Resources (this case involved a genuine redundancy, but R failed to meet its consultation obligations under Clerks Award – A was an executive assistant – after restructure, the only position A might have been redeployed to was a junior receptionist position – the disparity between A’s former role and the junior position and A’s failure, in the face of opportunity to express interest in the new role, contributed to finding that A’s dismissal not harsh etc)

[2014] FWC 2046 Vic Roberton v Car Stackers International (the A reacted badly during one on one consultation to the news there would be redundancies – consultation with A was left incomplete due to his intimidating, aggressive and threatening reaction – R decided A would therefore be the one made redundant – dismissal harsh etc as no valid reason and lack of procedural fairness)

[2014] FWC 3235 SA Lassiter v Ford Dynasty (after the A was told by R was it was looking at making his position redundant and that it wanted to discuss options with A, A absented himself from work on various forms of leave for an extended period – A’s position was then made redundant – in light of A’s deliberate unavailability for consultation, R had met its consultation obligations)

[2014] FWC 4514 WA Wessels v Midwest Vanadium (a destructive fire forced R to shut down a large part of its operations and A was made redundant along with 47% of R’s workforce – A claimed R did not meet its consultation obligations under the award – award required consultation when employer had made “definite decision to introduce major change in production” – FWC satisfied this “was a ruinous event forced on the Employer rather than the Employer being the architect of the change in production” and that therefore there was no “definite decision” – in any event there were general discussions with employees about redundancies – genuine redundancy found)

[2014] FWC 4564 Qld Collie v Metropolitan Caloundra Surf Life Saving Club Inc (“At the point that the intention to make his position redundant was discussed with Mr Collie, it was a fait accompli and the only possible option open to Mr Collie was a casual coaching position with uncertain hours. While it was open to the Club to discuss this option with Mr Collie, the casual position was presented as the only option. The manner in which the discussions occurred does not fulfil the obligations under the Award to consult. There was no discussion with Mr Collie about relevant skills and whether he could perform work other than coaching. While I accept that the Club’s capacity to redeploy Mr Collie into an administrative role was limited, there were casual employees performing work which could have been used to supplement the casual coaching role. This option was not discussed with Mr Collie, and had a proper consultative process been followed this subject could and should have been discussed” @28-29 – R’s lack of knowledge about A’s qualifications hindered it in considering redeployment options – R failed to consider redeploying A to an associated entity – see précis at Associated entities)

[2014] FWC 5275 WA Salisbury v McKay Drilling (“The change in this case was to make one position redundant. The context relevant at the time the change was made there were approximately 60 employees employed by the respondent. Whether a change has significant effects on particular employees affected is not determinative of whether or not it is a major change. There was not in this case a major change in the respondent’s production, program, organisation, structure or technology. Consequently there was no obligation under the Award for the respondent to consult with Mr Salisbury in these circumstances” @81)

[2013] FWC 9972 SA NTEIU v UniLife Inc. (in mitigation of pending redundancy R deployed worker to new role until February 2014 – R argued worker was now employed on a fixed term basis and that it had no further obligations re consultation and redeployment – the A argued worker’s employment was continuing and it was reasonable he be redeployed to an advertised position – A succeeded)

[2014] FWC 6606 Vic Zito v Goulburn Valley Imaging Group  (on balance, genuine operational reasons found – A, a long standing employee, was told at a meeting (that took her unawares), that her position was to be made redundant – at the meeting the A was not provided “all the relevant information about the changes including the nature of the changes proposed, the expected effects of the changes on employees and any other matters likely to affect employees … Because Mr Dodos did not comply with his obligations to provide relevant information, Ms Zito was prevented from having any discussion with Mr Dodos that could have caused him to adopt a different course of action. She was denied the opportunity to have a discussion which may have, in the words of the clause, averted or mitigated the impact of the changes on her” @65-66 – R’s failure to consult in circumstances where it had an HR manager weighs in favour of dismissal being harsh etc – unfair dismissal found)

[2014] FWC 5606 NSW Chang v Mega International Commercial Bank (manager made decision that A “could be made redundant purely on the basis that she filled in for Ms Chang for two weeks whilst she was on annual leave. The fact that she did not have to work overtime during these two weeks whilst performing both roles led her to believe that the Assistant Manager’s role was not a full time role” @35 – R “had determined that Ms Chang would be the employee to be made redundant before any consultation process had commenced. In the Full Bench Decision in UES (Int’l) Pty Ltd v Leevan Harvey the majority concluded that the selection process in identifying the redundant employee was not a relevant consideration in determining whether a dismissal was a genuine redundancy. I agree with this rationale as long as there is a transparent process in place. Such a process, examining each employee’s skill, competence and training did not occur. If it had, then Ms Chang may have been found to have superior knowledge and competency then some of her colleagues” @49-50 – A not treated in accordance with award and R’s policies – “By failing to consult in an appropriate manner, Mega ICBC has failed to meet the tests associated with the genuine redundancy provisions” @52 – A was a senior, long standing employee – A has not found other work – dismissal harsh etc)

[2014] FWC 6912 WA Millen v Electrix (the abolition of one position not a ‘major workplace change’)


[2014] FWC 8114 NSW Attard v Transfield Services (R’s consultation process was far from perfect – the statutory consultation requirement “cannot be elevated to any more than simple compliance. A bare minimum compliance is all that is required” @50 – “Transfield’s Agreement consultation obligations do not require it to do more than consult in the terms expressed under the Agreement. Mr Attard’s submissions attempted to raise Transfield’s level of compliance to one of best practice by demonstrating that more could have been done” @51 – consultation obligations met – genuine redundancy)


[2014] FWC 8475 WA Tino v Regis Resources (the extent of the obligation to consult in the Clerk’s award discussed – the questions to consider were: “Was the job that the Applicant performing made redundant? Was the Applicant notified of the decision to make her job redundant and was that notification as soon as was practicable after the decision had been made? Did the Respondent discuss with the Applicant (i) the effects of the changes; and (ii) measures to avert or mitigate the adverse effects of the changes? And Did the Respondent give prompt consideration to any matters raised by the Applicant?” @27 – all questions answered in the affirmative – adequate consultation and genuine redundancy found)


[2014] FWC 8739 NSW Michael v Transfield Services (legal principles concerning consultation canvassed in depth – The A “was provided with details about the 38 point selection procedure, which the respondent had determined for the retention of 6 of the affected employees … All employees were shown the criteria for their selection or non-selection and ‘walked’ through the process … Mr Foster made himself available to all employees to discuss the impact of redundancy and redeployment options … [A] was offered assistance in resume preparation and interview skills. However, he declined the offer” @53 – A also sought and was granted an internal review – adequate consultation found)


[2015] FWC 1209 Vic Leef v Riordan Group (contrary to Commissioner Cloghan’s conclusion in Bhalla v Welltech Total Water Management the abolition of one position can constitute major workplace change – compensation ordered 12/3/15 in [2015] FWC 1635)


[2015] FWC 1222 SA Bassanese v HPS Transport (“‘Major changes in production, program, organisation, structure or technology’ is not defined, other than by a reference to the likelihood that these changes will have ‘significant effects’ on ‘employees’. ‘Significant effects’ includes termination of employment. The use of the plural form ‘employees’ is to be taken to be inclusive rather than exclusive of the singular form, ‘employee’. To read the consultation provision as only having application where more than one employee suffers a significant effect as defined, is to import a meaning that is not consistent with the meaning and intent of the clause as a whole” @27-28)


Full Bench decisions

[2012] FWAFB 5241 UES (Int’l) v Harvey (Commissioner erred in finding that A’s dismissal related to his capacity – the A’s dismissal would have been a case of genuine redundancy if adequate consultation pursuant to the award had occurred – such consultation would have taken about two weeks – A entitled to two weeks remuneration – see commentary below at s389 commentary (generally))

Contact David Kidd at kiddlrs@optusnet.com.au for free access to consultation cases going back to 2010. See also www.kiddslaw.com