1
[2013] FWC 2470
DECISION
Fair Work Act 2009
s.739—Dispute resolution
Australian Municipal, Administrative, Clerical and Services Union
v
Australian Tax Office
(C2012/999)
Commonwealth employment
VICE PRESIDENT LAWLER SYDNEY, 23 APRIL 2013
Alleged dispute concerning APS 3 employees positions.
[1] This is a dispute referred to the Commission by the Australian Municipal,
Administrative, Clerical and Services Union (ASU) pursuant to the dispute resolution
procedure in the ATO Enterprise Agreement 2011 (Agreement).
[2] In July 2012 five Australian Tax Office (ATO) offices in Melbourne were
consolidated into a single, newly fitted-out building at “Collins Square”, 747 Collins Street.
Prior to that consolidation there were eight APS 3 staff employed in the Facilities
Management Branch who were required to ensure that the Facilities Management functions
were performed in respect of those five separate sites. Following the consolidation the ATO
requires less of those staff to manage the single “Collins Square” site. In particular, the ATO
is determined that it requires only four APS 3 positions in the Facilities Management Branch
for the efficient and economical working of its operations at the new “Collins Square” site.
What is at issue in the dispute is the process by which the ATO proposes to reduce the
number of APS 3 Facilities Management employees from eight to four.
[3] On 27 July 2012 Assistant Commissioner Smillie wrote to the ASU in the following
terms:
“CONSULTATION PROCESS: MANAGING POSSIBLE EXCESS STAFF IN
THE MELBOURNE CENTRAL BUSINESS DISTRICT.
The purposes of this correspondence is to inform you of the planned actions to manage
the issue of possible excess APS 3 staff within the Melbourne CBD site located at 747
Collins Street.
AUSTRALIA FAIR WORK COMMISSION
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As you may be aware there has been a process under way within the Melbourne CBD
to consolidate the following ATO occupied buildings into a single location at 747
Collins street:
...
One impact of this consolidation is that the current numbers of APS 3 staff is greater
than those required to manage a single modern building. There will be a lesser work
load as a result of the new premises as is evidenced in other CBD areas where the
ATO has consolidated lease holds such as the ACT.
The following advice has been sent (sic) to the affected staff on Wednesday, 1 August
outlining the proposed process to address the situation of excess APS 3 staff.
I am writing to inform you that Property, Security and Environmental Services
(PS&ES) now has more APS 3 staff in the Melbourne CBD than are required
or affordable. This means that not all APS 3 staff will hold a position in the
Melbourne CBD in the medium to long term.
As you are aware this situation has arisen due to the recent moves from the
various Melbourne CBD sites, with the following ATO buildings have been
consolidated into a single CBD building located at 747 Collins St.
414 Latrobe St
390 Latrobe St
350 Queen St
World Trade Centre
Casselden Place
Due to this reduction in the number of ATO sites, we will need to reduce the
numbers of APS3 staff accordingly. We have sought advice and looked at the
various options to achieve this in the fairest way, and are proposing to run a
process where the affected CBD staff will be given an opportunity to apply for
the positions within the new Collins St building. The successful APS 3 staff will
be selected based on merit and the opportunity to apply for these positions will
only be open to the current APS 3 staff who occupy positions within the CBD.
To ensure that the process is open and transparent we will work with ATO
people to ensure an independent selection committee is appointed to run the
process. Any staff that are not successful through this process will be
supported by the ATO as per the ATO Enterprise Agreement 2011.
I will also be writing to the Unions to ensure that they have an opportunity to
provide feedback on the proposed process. My intention will be to begin this
process as soon as practical after I have received any feedback and will keep
you informed when we have timeframes for the process to commence so that
each of you has the same opportunity to prepare and apply for the available
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positions. Please contact me on ext 66104 if you have any questions about this
process.
If you have any feedback I would appreciate you returning it to the Director of
Facilities Management, Andrew Osborne by COB 10th August 2012”
(underline emphasis added)
[4] By letter dated 2 August 2012 the ASU advised the ATO that it was in dispute over
the application of the Agreement in relation to the proposal. The ASU wrote:
“AC Smillie advised staff that he has sought advice, considered options and proposes to
run a process where the affected APS 3 staff will apply for the reduced number of their
own jobs. The unsuccessful staff will be supported by the ATO as per the ATO
Enterprise Agreement 2011.
AC Smillie’s proposal, made with ‘advice’ is contrary to clause 118 of the Agreement.
The ATO is obliged to follow the measures in clause 118.5 and following before it can
consider commencing a process for selecting which employees are excess as is now
proposed.”
[5] The letter sought to activate the dispute resolution procedure in the Agreement. The
matter came before Deputy President Smith for conciliation on 3 October 2012. In accordance
with a recommendation by Smith DP there was a further meeting of the parties on 7
November 2012 and there was an exchange of views in written correspondence. A further
conciliation conference was held on 9 January 2013. Smith DP’s recommendation noted the
“process raised in the letter of 27 July [2012] to the Australian Services Union constitutes a
proposal for discussion.”
[6] It is necessary to set out clauses 117 - 119 of the Agreement in full:
“117. Excess employees
117.1 This clause only applies to ongoing employees who are no longer on
probation.
When is an employee excess?
117.2 An employee becomes excess for either of the following reasons:
a) the duties of the employee are transferred to a different capital city or to
an office which requires a move of a similar scale, involving a
necessary change of residence, and
i) the employee is unwilling to perform duties at the new office;
and the Commissioner is unable to provide ongoing work at the
first office; and
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ii) the Commissioner agrees redundancy is an economically viable
alternative to relocation.
b) the Commissioner determines that the employee is a member of a given
class that has more members than is necessary for the efficient and
economical working of the ATO in a particular location.
118. Preventing excess employee situations
Consultation with employees and their representatives
118.1 The ATO will consult with employees and their representatives where the
provisions of this clause need to be exercised.
a) Consultation and communication processes established under clauses 2
and 3 of this Agreement will be used to consult employees and their
representatives about workforce adjustment issues;
b) The briefings of employees and their representatives, under sub-clause
3.3 of this Agreement, will be used to explain the overall funding and
likely staffing situation of the ATO. It is envisaged these meetings will
be held when data is available from the Budget and the additional
estimates process;
c) Employees and their representatives will be consulted in relation to
possible national corporate measures which could be taken under this
clause to prevent excess employee situations.
Preventing excess employee situations
118.2 This clause only applies to ongoing employees who are no longer on
probation.
118.3 The ATO will, as far as practicable prevent excess employee situations
through:
a) an employee retraining/redeployment approach so that employees
prepared to acquire new capabilities within an appropriate time can
reasonably expect to be employed by the ATO, and/or
b) the measures set out in clause 118.5 to 118.7.
118.4 Where the provisions in 118.3 are not successful in preventing excess
employee situations, the ATO will take actions consistent with any APS wide
redeployment principles.
Measures for preventing excess employee situations
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118.5 To prevent excess employee situations, the ATO will:
a) where appropriate, seek alternatives to redeploying employees, such as
moving work, or
b) reassign the employees to other duties in their sub plan within their
current site; or
c) if action taken under a) and b) above does not prevent the excess
employee situation then the ATO will attempt to reassign employees to
other sub plans within the site (refer to sub-clauses 118.7 and 118.8), or
d) where the above actions do not prevent the excess employee situation
then the ATO will attempt to reassign the employees to each employees
current sub plan within the region.
The order of action taken by the ATO under this sub-clause may be varied
following consultation with the employees and their representatives.
118.6 Where a sub plan has undertaken the measures in clause 118.5 and still cannot
prevent an excess employee situation the sub plans will participate in corporate
workforce adjustment activities.
Information in relation to these activities will be available to employees and
their representatives.
118.7 The ATO will assess employees, identified as being in a situation where they
are likely to be excess, for suitability for any identified ongoing job
opportunity in the ATO prior to it being filled in another way. In this context,
suitability of an employee will be based on:
a) suitability for the work in areas where they could be redeployed, not on
their relative suitability for work in the current work area; and
b) the employee’s ability to perform satisfactorily within a maximum of
three months.
Where there are insufficient volunteers, the ATO may identify and redeploy an
employee from the group of potentially excess employees.
Factors to be considered in redeployments under this clause
118.8 The following factors will be taken into account in redeploying employees:
a) Employees working in ATO sites outside the greater metropolitan area
of capital cities (e.g. Geelong, Newcastle Townsville, Wollongong and
Albury) will be given first consideration for additional job
opportunities that arise in those sites as the size of the offices means
there are different opportunities to those in metropolitan regions;
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b) Within the greater metropolitan area of capital cities, on occasions it
may be more practicable and reasonable to redeploy an employee
between BSLs in their current site, than to re-assign the employee to a
job in a different site in their current BSL. To the extent practicable,
employee preferences and ‘hardship’ factors will be taken into
consideration in redeployment decisions;
c) Employees may express interest in redeployment to another region, but
the first priority will be to find jobs for employees within their current
region. The ATO is not obliged to redeploy employees between regions
and such redeployments do not have priority over other vacancy filling
methods unless determined by the Commissioner;
d) Where a site is closing, employees may express a preference for a site
for their redeployment. The ATO will take this preference into account
in corporate workforce adjustment activities.
118.9 An employee who is redeployed to another office in the same city will be
eligible for the relocation provisions under clause 112.
118.10 If both the ATO and the employee agree on redeployment to another region,
the move may be considered to be in the interests of the ATO.
119. Redundancy provisions
Application
Where measures under clause 118 do not resolve the situation
119.1 This clause only applies to ongoing employees who are no longer on
probation.
If, despite relevant steps having been taken under clause 118, an excess
employee situation is likely to arise, the six steps set out in this clause will be
taken.
119.2 Where 15 or more employees are considered to be excess, steps 3 to 6 below
will apply as well as any relevant provisions provided for by relevant
legislation.
119.3 Where less than 15 employees are considered to be excess the following steps
will apply.
119.4 The six steps are:
Step 1
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Affected employees and where they choose, their representatives, will be
informed and will be provided with the following information:
a) the reasons why employees are likely to become excess; and
b) the time when, or the period over which, it is likely to occur.
When advising affected employees of the situation, the ATO will specifically
ask the affected employee to identify which representative they wish the ATO
to advise of the situation.
Step 2
1. Employees and, where they choose, their representatives will have one
month for consultation with ATO management about:
a) measures that have been, or could be, taken to remove or reduce
the likelihood of excess employees;
b) redeployment prospects for the employee(s) concerned;
c) the appropriateness of using voluntary redundancy; and
d) the method of identifying an employee as excess, having regard
to the efficient and economical working of the ATO and the
relative efficiency of employees.
2. If the invitation to be consulted is declined or it is agreed that the full period
is not needed, follow on action may be taken before the end of the one month
period.
3. If the Commissioner agrees, the period will be extended beyond one month.
4. Apart from employees who express interest in voluntary redundancy, no
employee will be notified that they are excess within one month of the
consultation period commencing.
Step 3
1. If redeployment or other measures are not feasible or only partially remove
the problem, the Commissioner will identify the employees who are considered
to be excess.
2. Nothing in these procedures will prevent excess employees being identified
by seeking informal expressions of interest in voluntary redundancy.
Employees who lodge an informal expression of interest in Voluntary
Redundancy will be provided with, or given access to, information in relation
to their likely entitlements. This could take the form of access to ‘selfhelp’
methods of estimating final leave/severance payments and superannuation
benefits.
[2013] FWC 2470
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3. Where the ATO determines that it is effective and economical to do so, the
ATO will facilitate the use of swaps to maximise the extent to which
redundancies are voluntary.
4. Employees must be notified in writing that they are excess employees.
Step 4
1. Employees who are identified as being excess will be provided with the
following information:
a) estimates of severance benefits, pay in lieu of notice and pay in lieu of any
unused annual, purchased or long service leave credits;
b) the estimated amount of taxation the ATO will deduct from any payments;
c) access to superannuation information;
(i) For employees who are members of the CSS or PSS (either defined
benefit or accumulation plan) the ATO is authorised by the employee to
obtain details of accumulated superannuation contributions and the
options available to those employees in relation to superannuation. The
ATO will provide this information to the employee;
(ii) Employees who are not members of either the CSS or PSS funds are
responsible for obtaining details about their options in relation to
superannuation from their superannuation fund. The ATO will, where
possible, assist the employee to get this information by providing
relevant information in writing to the employee; and
d) the retention provisions which apply if the employee declines an offer of
voluntary redundancy, including information about how the amortised salary
would be calculated if they nominate the Alternate Retention Period as
determined by Step 5 (4).
2. Once the employee has been provided with the information as set out in a),
b) and c) (i) and d) above, and for an employee covered by c) (ii) they have had
reasonable time to get the information, they will be made a formal offer of
voluntary redundancy. An employee will have up to two weeks to accept or
decline such an offer. Where the employee declines the offer, they will be
required to, at the same time, nominate which retention period provisions they
wish to apply to them (ie. the Retention Period as determined by Step 5 (3) or
the Alternate Retention Period as determined by Step 5 (4).
3. Employees who accept the formal offer of voluntary redundancy will be
given notice of termination and will be paid a voluntary redundancy severance
benefit. With the agreement of the employee, follow on action may commence
inside the two week period.
[2013] FWC 2470
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4. If the employee does not respond to the ATO within the two week period
provided in subclause 2 above, they will be taken to have declined the offer.
5. If the employee does not nominate a retention period within the two week
period provide in sub-clause 2 above, the retention period under Step 5 (3) will
apply to them.
6. The ATO will not make a further offer of a voluntary redundancy to the
employee at later steps in the process.
Step 5
1. Employees who decline the offer of voluntary redundancy will begin a
formal retention period, to apply from that date.
2. Where the ATO determines that it is effective and economical to do so, the
ATO will facilitate the use of swaps to maximise the extent to which
redundancies are voluntary.
3. Retention period - An excess employee who declines the offer of voluntary
redundancy will be entitled to the following period of retention:
a) 13 months where the employee has 20 years or more service or
is over 45 years of age; or
b) 7 months for all other employees,
reduced by the relevant NES redundancy pay period that would apply to the
employee at the end of 7 or 13 months retention period.
4. Alternate Retention Period - Where an employee elects to enter into the
retention period provisions under this sub clause, the employee’s retention
period determined in 3 above will be:
a) 13 months where the employee has 20 years or more service or
is over 45 years of age; or
b) 7 months for all other employees.
5. Payment of salary during retention period
a) Unless (b) below applies an employee will be paid at their
ordinary rate of pay during their retention period.
b) (i) Where an employee elects to enter into the Alternate
Retention Period provisions their total pay throughout the
retention period will be reduced by an amount equivalent to the
employee’s redundancy pay entitlement under the NES, with
such redundancy pay period entitlement calculated as at the
expiration of the retention period.
[2013] FWC 2470
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(ii) For the purposes of (b)(i), the reduction of the employee’s
ordinary pay will be amortised over the duration of the retention
period.
6. If during the Alternate Retention Period the employee ceases to be excess
(other than by termination of employment for the reason of being excess)
amortisation will cease and the amount deducted as part of the amortisation
provisions will be paid to the employee.
Step 6
Employees who cannot be placed in a suitable job within three months of
declining an offer of voluntary redundancy:
a) will be advised that, because sufficient work is expected to remain available,
it is intended to retain their services for the whole of their retention period,
including the period since the offer of voluntary redundancy was rejected. In
other than exceptional circumstances, it is expected that this will normally be
the case but it may be necessary for affected employees to move to a different
type of work, for which they are suitable, during this period; or
b) where the Commissioner is satisfied at any time in the remaining retention
period that there is insufficient productive work available for the employee
during the remainder of the retention period and that there is no reasonable
redeployment prospects in the APS, the Commissioner may:
i. Give written notice of the involuntary termination of the
employee’s employment under s.29 of the PS Act; or
ii. by agreement with the employee, give written notice of
involuntary termination of their employment; or
c) will be given 4 weeks’ written notice of the intention to reduce their
classification so that they can be redeployed to suitable employment, in which
case income maintenance will apply instead of an involuntary redundancy
benefit;
d) may at any time, be given written notice of the involuntary termination of
the employee’s employment under s.29 of the PS Act.
Support for excess employees
119.5 Employees who are identified as being excess, or offered a voluntary
redundancy, will be reimbursed for the costs of the following support where
they choose to use it:
a) career, lifestyle and/or financial planning by a qualified advisor; and/or
b) assistance with preparation of applications for job interviews.
[2013] FWC 2470
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The maximum total amount of reimbursement under a) and b) is $2,200.
119.6 During any notice or retention periods referred to in this clause:
a) the ATO will provide assistance to the employees to try to find
opportunities to redeploy the employee to another agency. This includes
actions consistent with any APS wide redeployment principles; and,
b) excess employees will be given reasonable time to attend employment
interviews, including reasonable travel and incidental expenses where these are
not met by the prospective employer.
119.7 Where an excess employee has to move their household to a new locality as a
result of a movement at level or reduction in classification, they will be entitled
to reasonable travel and relocation expenses as if being promoted.
Payment if reduced in classification
119.8 If an employee is reduced in classification, the employee will maintain the base
salary they had immediately prior to the reduction for either 7 or 13 months,
less the period of employment since the offer of voluntary redundancy was
rejected.
Notice period
119.9 The following notice periods will apply where employment is terminated:
a) if over 45 years of age, with at least 5 years continuous service: 5
weeks’ notice;
b) other employees: 4 weeks’ notice.
Voluntary redundancy benefit
119.10 An employee who elects for retrenchment with a redundancy benefit and
whose employment is terminated by the Commissioner under s.29 of the
Public Service Act 1999 on the grounds that he/she is excess to the
requirements of the ATO, is entitled to payment of a redundancy benefit of an
amount equal to two weeks’ salary for each completed year of continuous
service, plus a pro-rata payment for completed months of service since the last
completed year of service, subject to any minimum amount the employee is
entitled to under the NES.
Attachment C sets out certain conditions relating to service for redundancy
benefit purposes.
119.11 The minimum sum payable will be an amount equal to 4 weeks’ salary and the
maximum payable will be equal to 48 weeks’ salary.
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119.12 The redundancy benefit will be calculated on a pro rata basis for part time
hours during the period of service if the employee has less than 24 years full
time service.
119.13 This benefit will be in addition to any payment in lieu of the notice period and
accrued annual leave, long service leave and purchased leave credits.
Involuntary redundancy benefits
119.14 Where employment is terminated involuntarily, employees will be paid a sum
calculated as follows:
a) for employees with 20 or more years of service or over 45 years of age:- a
lump sum equal to 13 months salary reduced by the amount of salary paid since
the date the offer of voluntary redundancy was rejected; or
b) for others:- a lump sum equal to 7 months salary reduced by the amount of
salary paid since the date the offer of voluntary redundancy was rejected.
119.15 Such employees will receive payment in lieu of accrued Annual Leave and
Purchased Leave calculated as if the date of termination of their employment is
13 months or 7 months (as the case may be) later than the date the offer of
voluntary redundancy was rejected.
119.16 If the total amount payable is less than the total amount (including pay in lieu
of leave) that would have been payable had the employee accepted the offer of
voluntary redundancy (reduced by any salary received since the date the offer
was rejected), the employee will be aid an additional amount to bring the total
benefit to that amount.
Salary for calculating benefits
119.17 For calculating redundancy benefits, an employee’s salary will include:
a) HDA, if received on the date notice is given and has been payable for a
continuous period of at least 12 months at that date;
Where the higher duties of an employee who has received HDA for a
continuous period of 12 months is ceased due to the workforce adjustment
process necessitating the redundancy, and the employee would otherwise have
continued to receive higher duties until the date notice was given, the higher
duties will be taken to have continued to the date notice was given for the
purpose of this clause.
b) an average of shift penalties over the 12 months prior to notice being given,
provided shift work has been rostered in at least 26 weeks; and
c) any other regular allowance in the nature of salary received on the date
notice is given.”
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(underline emphasis added)
Summary of the contentions of the parties
[7] The ASU’s essential submission is that the process outlined in the 27 July 2012 letter
from the ATO is not permissible under clauses 117, 118 and 119 of the Agreement. The ASU
contends that clauses 118 and 119 constitute a ‘code’ which must be observed by the ATO
and followed in a sequential fashion. In particular, the ASU contends that the obligations
under clause 118 must be complied with before the procedure in clause 119 is commenced. In
that regard the ASU places a particular emphasis on the sub-heading to clause 119.1 and the
second paragraph of clause 119.1. The ASU also places emphasis on the last portion of clause
118.5 together with the overall structure of clause 118 in submitting that the ATO is obliged
to discharge its obligations under clause 118 before moving to clause 119 and the fact that
variations to the action required by clause 118.5 can only occur following consultation with
the employees and their representatives provides significant support for that contention.
[8] The ASU contends that clauses 117 to 119 do not permit the use of voluntary
redundancy except in the circumstances outlined in clause 119.4. The ASU also places
particular emphasis on clause 118.7 and argues that the “suitability” focus of clause 118.7(a)
is inconsistent with the ATO conducting a merit based selection process to determine which
of the eight Facilities Management employees will retain their jobs.
[9] The ATO contends that on the proper construction of the Agreement clauses 118 and
119 are to be applied in a practical and business like fashion and that there is no strict
sequence as contended for by the ASU.
[10] The ATO also contends that the invitation to employees to submit expressions of
interest in receiving a voluntary redundancy is a step that is consistent with clause 118.3 of
the Agreement. The ATO also contends that seeking expressions of interest and proposing a
merit based selection scheme of the sort set out in the 27 July letter is consistent with clause
118.5(a) as the proper alternative to redeployment that is being sought, reasonably, by the
ATO.
[11] The ATO places particular reliance on item 4 of Step 2 and item 2 of Step 3 in clause
119.4 as indicating that it is permitted to seek informal expressions of interest in voluntary
redundancy at any time.
Consideration
[12] The principals of construction are well known and do not need to be recited here.
[13] Clause 117 is definitional and specifies when an employee becomes excess. It
distinguishes between two situations specified in clause 117.2(a) and (b). In the present case it
is the situation in clause 117.2(b) that is relevant. An employee in that situation becomes
excess when the Commissioner formally “determines” the employee to be excess. That formal
determination cannot occur until Step 3 of the process laid down in clause 119.4 is completed.
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Prior to that formal determination an employee may be “likely to be an excess employee” or a
“potentially excess employee”.
[14] Clause 118.3 imposes an obligation on the ATO to prevent excess employee situations
through the measures specified in clauses 118.3(a) “and/or” 118.3(b) but only “as far as
practicable”. The language recognises that it may not be practical to prevent an excess
employee situation through those measures.
[15] When an “excess employee situation” exists clause 119 provides a process that can
lead, ultimately, to compulsory redundancy. While clause 118 is concerned with “preventing
excess employee situations” and is focussed on prevention through redeployment, it is not
confined to redeployment. Clause 118.5(a) requires the ATO to “seek alternatives to
redeploying employees, such as moving work” where this is appropriate.
[16] When the measures specified in clause 118.5 have been considered but have not
prevented the “excess employee situation”, clause 118.7 imposes a continuing obligation on
the ATO to consider redeployment for employees who are “likely to be excess”.
[17] So far as clause 118.6 is concerned, it is unclear precisely what is meant by “corporate
workforce adjustment activities”. The ATO’s written submissions note:
“4.20 ... On the face of the provision, it is not clear what measures are envisaged by this
expression, nor the extent (if any) to which such activities overlap with any or all of
the types of measures for which earlier subclauses make provision. In the real world of
day to day ATO life, however, the expression is maturely understood and
implemented. In practice, and in accordance with guidance available on the ATO staff
intranet, “corporate workforce adjustment activities” generally involve:
(a) adding excess employees to a national register which vacancy delegates are
required to check before filling ongoing vacancies;
(b) giving excess employees special consideration for ongoing vacancies at level
and within their region/location (i.e. assessing excess employees for suitability in
isolation rather than relative to other candidates); and
(c) ATO People (which performs the human resources function with the ATO)
liaising with national workforce adjustment contacts to try and identify suitable
vacancies for excess employees.”
[18] Clause 118.7 tends to corroborate that submission.
[19] I agree with the submission on behalf of the ASU that on the proper construction of
these clauses the ATO is required to attend to its obligations under clause 118 before it
commences the redundancy process set out clause 119. The heading to clause 119.1 and the
second paragraph of that clause are unambiguous and there is no reason why the ordinary
meaning of those words should not be given effect.
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[20] However, the delineation between the obligations imposed by clauses 118 and 119 is
not sharp. Clause 119.4 lays down a six step process. Steps 1 and 2 are essentially
consultation steps. The overlap between items 1(a) and (b) of Step 2 and clause 118 is
obvious. Step 3 provides for the formal identification of employees as “excess” with Steps 4
and following providing for a familiar redundancy process whereby employees have the
opportunity of accepting voluntary redundancy or moving into a retention period with
compulsory redundancy at the end of that period if no redeployment occurs.
[21] A formal determination by the Commissioner that an employee is “excess” occurs at
Step 3 of clause 119 and occurs only “[i]f redeployment or other measures are not feasible or
only partially remove the problem”. That is, the Agreement contemplates that measures other
than redeployment may partially remove the problem constituted by the likely excess
employee situation.
[22] Adopting a practical approach to the construction of the Agreement, the absence of a
clear delineation between clauses 118 and 119 counts against construing the reference to a
consideration of voluntary redundancy in item 1(c) of Step 2 in clause 119 as indicating that
voluntary redundancy can only be considered once the requirements of clause 118 have been
complied with. It may also be noted that item 4 of Step 2 suggests that employees may be
invited to consider voluntary redundancy before they are formally identified as “excess”
under item 1 of Step 3.
[23] The language of clause 118 is broad and I can see no reason not to give a broad
operation to the terms of clause 118.5(a). I am satisfied that the seeking of expressions of
interest for voluntary redundancy contained in the ATO letter of 27 July 2012 is an alternative
to redeployment within the meaning of clause 118.5(a), as is a merit selection process to
determine which of the eight employees should retain their jobs and not face the prospect of
being determined to be “excess”.
[24] Moreover, in my view item 2 in Step 3 of clause 119 should be read broadly and the
reference to “these procedures” is not confined to the steps in clause 119.4 but relates to the
procedures generally that can lead to redundancy including the procedure in clause 118. I
place significance on the reference to the plural “procedures”. This also provides support for
the conclusion that voluntary redundancy is one of the “other measures” that might “partially
remove the problem”. Of course, such an offer is without prejudice to the ATO’s obligation to
offer voluntary redundancy at Step 4 of the procedure in clause 119.4.
[25] The practical effect of AC Smillie’s letter of 27 July 2012 was to convey to the ASU a
proposal on which consultation was proffered to address a likely “excess employee situation”.
In the particular circumstances of the affected facilities management employees, it was most
unlikely that the ATO could prevent that excess employee situation through the measures
specified in clause 118.3 (a) or (b). It was reasonably open to the ATO to conclude that it was
not practicable to prevent the “excess employee situation” in that way.
[26] Clause 118.5(a) authorises the ATO to propose alternatives to redeploying employees
as a way of preventing the “excess employee situation”. In accordance with the practical
approach to the construction of industrial agreements mandated by the authorities, and the
objects of the Agreement, which emphasise flexibility, cooperation and productivity (see
[2013] FWC 2470
16
clause 1, particularly paragraphs (b), (c) and (f)), the proposal for offers of voluntary
redundancies and a merit based selection process advanced by AC Smillie was consistent with
clause 118.5(a). Those affected employees who decline to accept a voluntary redundancy as
proposed in AC Smillie’s letter will, of course, retain their right to consider voluntary
redundancy under Step 4 of clause 119.4.
[27] I am not persuaded that clause 118.7 has the operation for which the ASU contends in
this case. In particular, I am not persuaded that clause 118.7 has the effect of prohibiting the
ATO from conducting a merit based selection process to determine which of the eight
employees will retain the four positions in the new Collins Square site and which will face the
possibility of being determined to be excess and required to go through the redundancy
process in clause 119.
[28] I am satisfied that the actions taken by the ATO thus far are actions that are properly
in the discharge of its obligations under clause 118.
[29] Even if I had embraced the ASU’s case fully, in the exercise of my discretion in the
particular circumstances of this case I would have declined to make any determination
requiring the ATO to abandon its present course of seeking expressions of interest for
voluntary redundancy. It needs to be appreciated that such expressions of interest are not
compulsory and each of the eight affected employees is at perfect liberty to refrain from
expressing interest in a voluntary redundancy without any adverse consequences flowing. The
ATO is still obliged to comply with clause 119. This cases involves a classic redundancy
situation. There are eight employees in a particular class for which only four jobs remain. The
eight employees do not have technical taxation skills. The proposal advanced by AC Smillie
in his letter of 27 July 2012 for consultation with the ASU was practical, sensible and fair.
[30] The questions posed for determination are answered as follows:
(a) Is a merit based selection process prior to, or as part of, clause 118 measures
permissible under the Agreement? Yes.
(b) Do clauses 118-119 need to be followed completely sequentially? Yes, albeit
that there is a degree of overlap between what is required by clause 118 and what is
required by Step 2 of clause 119.4. This does not mean that clause 118 and Step 2 of
clause 119.4 can be complied with concurrently, rather it means that when the ATO
has complied with its obligations under clause 118, it will be obliged to provide a
further month for consultation on the matters specified in Step 2 unless it is agreed
that the full period is not needed.
[2013] FWC 2470
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(c) Can the ATO seek expressions of interest in voluntary redundancy at this stage
from the eight affected APS3 facilities management staff? Yes.
Appearances:
R McPhee with J Lapidos for the Australian Municipal, Administrative, Clerical and Services
Union.
J Snaden of Counsel with A Pick for the Australian Tax Office.
Hearing details:
2013.
Melbourne:
February 18.
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