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Fair Work Act 2009
s.120 - Application to vary redundancy pay for other employment or incapacity to pay
Australian Commercial Catering Pty Ltd
v
Mrs Marcelia Powell
(C2014/3631)
COMMISSIONER ROE MELBOURNE, 10 APRIL 2014
Application to vary redundancy pay.
[1] Australian Commercial Catering Pty Ltd (the Applicant) lost the catering contract at
Robert Bosch effective from 25 October 2013 and advised employees of that fact on 16
August 2013. Ms Powell had been employed as a full time employee by the Applicant
working on the Robert Bosch contract for nine years. Ms Powell was advised on that date that
she could seek to continue her employment with the new provider to Robert Bosch (Alliance
Catering) in which case she would be paid her entitlements by the Applicant or she may be
offered an alternative position with the Applicant or if there is no other position available with
the Applicant or if she was unsuccessful in continuing with the new contractor she would be
made redundant.
[2] As at 23 October 2013 no alternative position with the Applicant had been found and
discussions with Alliance about employment with them were continuing. On 23 October 2013
the Applicant wrote to Ms Powell and advised that they were now able to “offer you a
position with us should you decline your offer with Alliance Catering.” The letter also
advised “please note that if you do not take up the Alliance or ACC offer you will not be
entitled to the redundancy offer.” This was a clear reference to the issue of entitlement to
redundancy payments which had been the subject of earlier correspondence on 11th and 17th
of October 2013 where Ms Powell was put on notice that if she rejected an offer of
employment with the new employer on terms and conditions substantially similar to those
with the old employer then redundancy payments would not apply. On 25 October 2013 Ms
Powell advised the Applicant that she was not taking up employment with Alliance and was
also not taking up the alternative position with the Applicant. Ms Powell declined the options
on offer because the hours offered by Alliance were unsuitable and because Ms Powell could
not manage the logistics of travelling to the location of employment offered by the Applicant.
[3] The Applicant is seeking pursuant to Section 120 of the Fair Work Act 2009 (Cth) (the
Act) that the 16 weeks redundancy entitlement which they say would otherwise have been
payable to Ms Powell be reduced to zero on the grounds that the Applicant offered Ms Powell
suitable alternative employment working on another contract for the Applicant on equivalent
terms and conditions.
[2014] FWC 2432 [Note: Appeals pursuant to s.604 (C2014/662) and
C2016/3067 were lodged against this decision and the order arising from
this decision - refer to decisions dated 20 October 2014 [[2014] FWC
7412], Full Bench decision dated 6 March 2015 [[2015] FWCFB 87] and
12 August 2016 [[2016] FWCFB 5467] respectively for result of appeals.]
DECISION
E AUSTRALIA FairWork Commission
http://www.fwc.gov.au/decisionssigned/html/2016FWCFB5467.htm
https://www.fwc.gov.au/documents/decisionssigned/html/2015FWCFB87.htm
https://www.fwc.gov.au/documents/decisionssigned/html/2014FWC7412.htm
https://www.fwc.gov.au/documents/decisionssigned/html/2014FWC7412.htm
https://www.fwc.gov.au/documents/awardsandorders/html/pr549581.htm
[2014] FWC 2432
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[4] In response to my question the Applicant advised that it was not arguing that this was
a transfer of employment situation dealt with under Section 122 of the Act.
[5] This matter was subject of Hearing on 8 April 2014. Having heard from the parties I
issued a decision on transcript.
[6] For reasons outlined on transcript I accepted the submission of the Applicant,
Australian Commercial Catering Pty Ltd, that Ms Powell was entitled to be paid an amount of
redundancy because of Section 119 of the Act and that the employer had obtained other
acceptable employment for the employee. For the reasons outlined on transcript I considered
the offer of employment with the Applicant at another site to be other acceptable employment
because it was on terms and conditions substantially similar to the pre-existing terms. I did
not consider that the distance of the relocation from Clayton in Melbourne to Tooronga in
Melbourne altered this judgment.
[7] For the reasons outlined on transcript I took into account the particular reasons why
the employment was not acceptable to Ms Powell and I determined that it was appropriate in
all of the circumstances to reduce the amount of redundancy pay to 33% of the entitlement
specified in the correspondence to Ms Powell from Australian Commercial Catering Pty Ltd
dated 17 October 2013. The amount payable is $3,254.50. Given that Ms Powell’s
employment with Australian Commercial Catering Pty Ltd ended on 25 October 2013 it
would be inappropriate for there to be further delay in the payment of her entitlements.
[8] I will Order that to the extent that Ms Powell is otherwise entitled to redundancy
payment arising from the termination of her employment with Australian Commercial
Catering Pty Ltd the amount of that redundancy payment shall be reduced to 33% of the
entitlement specified in the correspondence to Ms Powell from Australian Commercial
Catering Pty Ltd dated 17 October 2013; that is, the amount is reduced to $3,254.50. The
amount payable shall be paid within 14 days of the date of this Order.
COMMISSIONER
Appearances:
Mr P Darmos appeared for the Respondent.
Hearing details:
2014
Melbourne
April 8
THE FAIR WORK COMMISSION AUSTRALIA uis TA
[2014] FWC 2432
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