1
Fair Work Act 2009
s.394—Unfair dismissal
Larry Crozier
v
G H Varley Pty Ltd
(U2020/7378)
DEPUTY PRESIDENT SAUNDERS NEWCASTLE, 12 OCTOBER 2020
Application for an unfair dismissal remedy – jurisdictional objection – genuine redundancy –
failure to comply with consultation obligations – dismissal unfair – compensation ordered.
[1] Mr Crozier was employed as a tradesman by the respondent, G H Varley Pty Limited
(Varley), from 12 July 2017 until 7 May 2020. Varley contends that Mr Crozier’s dismissal
was a genuine redundancy within the meaning of s 389 of the Fair Work Act 2009 (Cth) (Act).
Mr Crozier denies that assertion and contends that his dismissal was harsh, unjust and
unreasonable.
Background
[2] Mr Crozier filed his unfair dismissal application in the Fair Work Commission
(Commission) against Varley on about 28 May 2020 (Application).
[3] I held a hearing by videoconference conference on 25 September 2020. Mr Crozier
gave evidence at the hearing on behalf of himself, as did Mr Cory Wright, Australian
Manufacturing Workers’ Union (AMWU) NSW State Secretary and Mr Todd Nickle,
Organiser of the AMWU. Varley adduced evidence from Mr Wayne Moy, Production
Manager of Varley, and Ms Jan Dobbie, Human Resources Manager of Varley.
Initial matters to be considered
[4] Section 396 of the Act sets out four matters which I am required to decide before I
consider the merits of the Application.
[5] There is no dispute between the parties and I am satisfied on the evidence that:
(a) the Application was made within the period required in s 394(2) of the Act;
(b) Mr Crozier is a person protected from unfair dismissal; and
(c) Varley is not a small business according to the Act and therefore the Small
Business Fair Dismissal Code does not apply.
[2020] FWC 5432
DECISION
E AUSTRALIA FairWork Commission
[2020] FWC 5432
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[6] In relation to the fourth initial matter which I am required to consider, there is a
dispute between the parties regarding whether Mr Crozier’s dismissal was a genuine
redundancy. Accordingly, I must decide that question before I consider the merits of the
Application.
Genuine Redundancy
[7] Section 389 of the Act defines genuine redundancy as follows:
“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.”
[8] “Associated entity” has the meaning given by s 50AAA of the Corporations Act 2001
(Cth).
The employer no longer required the employee’s job to be performed by anyone because
of changes in the operational requirements of the employer’s enterprise (s 389(1)(a))
[9] It is necessary to determine whether Varley no longer required the job of Mr Crozier
to be performed by anyone because of changes in the operational requirements of Varley’s
enterprise.1
[10] A job involves “a collection of functions, duties and responsibilities entrusted, as part
of the scheme of the employer’s organisation, to a particular employee”.2 Where there has
been a reorganisation or redistribution of duties, the question is whether the employee has
“any duties left to discharge”.3 If there is no longer any function or duty to be performed by
that person, their job becomes redundant.4 For example, an employer may redistribute all the
1 Section 389(1)(a) of the Act
2 Jones v Department of Energy and Minerals (1995) 60 IR 304 (Jones) at 308 per Ryan J; applied in Ulan Coal Mines
Limited v Howarth [2010] FWAFB 3488; (2010) 196 IR 32 (Ulan Coal 1) at [17]
3 Ibid
4 Ibid
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tasks done by a particular person between several other employees, resulting in the person’s
job no longer existing.
[11] An employee’s job may still be genuinely made redundant when there are aspects of
the employee’s duties still being performed by other employees.5 The test is whether the job
previously performed by the employee has survived the restructure or downsizing, not
whether the duties have survived in some form.6
[12] The reference to “changes in the operational requirements of the employer’s
enterprise” in s 389(1)(a) of the Act includes circumstances where an employer restructures
its business to improve efficiency, productivity, sales, revenue or some other aspect of
performance. The operational circumstances of a business which may give rise to a
redundancy will reside in the direct knowledge of the employer. The evidentiary onus is on
the employer to provide direct evidence about the nature of the employee’s job and why it is
no longer required to be performed as a result of changes in the operational requirements of
the employer’s enterprise.
[13] If a dismissal is found to be a genuine redundancy within the meaning of the Act,
issues such as unfair selection procedures for redundancy are not relevant, because they go to
the merits of the claim that the applicant was dismissed harshly, unjustly or unreasonably.7
Consideration
[14] In his written submissions filed in reply, the Applicant rightly conceded that it is was
open to the Commission to find that the Applicant’s job was not being performed by anyone.8
Mr Moy gave evidence,9 which I accept, that as a result of scheduled ramp downs and supply
issues arising out of COVID-19 there was a reduction in the available work on Varley’s
Medium and Heavy Containers project (MHC Project). He also gave evidence that those
circumstances resulted in Varley having an excess of eight positions on the MHC Project,
which included two boilermaker positions.10 At the relevant time, Mr Crozier was engaged on
the MHC Project as a boilermaker.11 Hence, I find that Varley no longer required the job of
Mr Crozier to be performed by anyone because of changes in the operational requirements of
Varley’s enterprise.
Compliance with any consultation obligation in a modern award or enterprise
agreement that applied to the employment (s 389(1)(b))
[15] For there to be a genuine redundancy within the meaning of s 389 of the Act, Varley
must have complied with any obligation in a modern award or enterprise agreement to consult
about the redundancy. There was no contest and I am satisfied on the evidence that the GH
Varley Pty Ltd Tomago Enterprise Agreement 2018 – 2021 (Agreement) applied to Mr
Crozier’s employment with Varley. Hence, for there to be a genuine redundancy in
5 Dibb v Commissioner of Taxation (2004) 136 FCR 388 at 404-5
6 Kekeris v A. Hartrodt Australia Pty Ltd [2010] FWA 674 at [27] per Hamberger SDP
7 Johnston v Blue Circle Southern Cement Pty Ltd (2010) 202 IR 121 at [48]
8 Applicant’s reply submissions dated 2 September 2020.
9 Witness statement of Wayne Moy at [20] – [22], [27]
10 Witness statement of Wayne Moy at [31]
11 Witness statement of Laurence Crozier at [2]; Applicant’s submissions at [13]
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accordance with s 389(2) of the Act, Varley must have complied with any obligation in the
Agreement to consult about the redundancy.
[16] The following clauses of the Agreement are relevant:
“3. Consultative Approach and Processes
The parties agree to undertake consultation on any matter related to this Agreement.
Consultation will occur prior to decisions being made or action being taken.
All consultation will be undertaken in Good Faith, without prejudice and in a manner
that allows for fair consideration of the matters at hand while also moving to resolve
the matter as quickly as practical.
The process of undertaking consultation does not imply consensus must be reached by
the parties. But the parties will aim to reach consensus wherever possible.
Any changes proposed for Company policies that sit outside of this Agreement and
which are directly applicable to Employees will not take effect without due
consultation with Employees and / or their nominated delegates.
For the purpose of clarity consultation is defined as per the Fair Work Commission:
To appropriately inform and engage Employees, inviting and considering their
response. It requires more than a mere exchange of information, Employees must be
contributing to the decision making process.
3.1 Consultation regarding major workplace change - Requirement to Consult
This Clause applies if the Employer:
a. Believes a major change to production, program, organisation, structure or
technology in relation to the enterprise is likely to have "a significant effect" on
the Employees; or
…
3.2 Notification
For a major change:
a. The Employer must notify the relevant Employees of the decision to
introduce the major change; and
b. Sub clauses 3.3 through to 3.7 apply.
Relevant Employees means the Employees who may be affected by a change referred
to in Clause 3.6.
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3.3 Representation
The relevant Employees may appoint a representative for the purposes of the
procedures in this Sub Clauses and Sub Clause 4.
If a relevant Employee appoints, or relevant Employees appoint, a representative for
the purposes of consultation and the Employee or Employees advise the Employer of
the identity of the representative, the Employer must recognise the representative.
3.4 Consultation with Employees
As soon as practical after making its decision that a significant change is required, the
Employer must:
a. Discuss with relevant Employees:
(i) The introduction of the proposed change; and
(ii) The effect the change is likely to have on the Employees; and
(iii) Measures the Employer is taking to avert or mitigate the adverse
effect of the change on the Employees; and
b. For the purposes of the discussion- provide in writing the relevant
Employees:
(i) All relevant information about the change including the nature of the
change proposed; and
(ii) Information about the expected effects of the change on the
Employees; and
(iii) Any other matters likely to affect the Employees.
The Employer must invite the relevant Employees to give their views about the impact
of the change including any impact in relation to their family or caring responsibilities.
The Employer must give prompt and genuine consideration to matters raised about the
change by the relevant Employees.
3.5 Non-disclosure of certain information
The Employer is not required to disclose confidential or commercially sensitive
information to the relevant Employees.
3.6 Significant effect
A major change is likely to have a "significant effect" on Employees if the change
results in:
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a. The termination of the employment of Employees; or
b. Major change to the composition, operation or size of the Employer's
workforce or to the skills required of Employees; or
c. The elimination or diminution of job opportunities (including opportunities
for promotion or tenure); or
d. The alteration of hours of work; or
e. The need to retrain Employees; or
f. The need to relocate Employees to another workplace; or
g. The restructuring of jobs.
…
23. Termination by Employer
23.1 Redundancy
It is the aim and intention of the parties to retain permanent workers in employment in
preference to making positions or people redundant.
From time to time the Employer will experience an unexpected and / or significant
downturn. Alternatively, the Employer may make a structural change which means
some positions are no longer required. In such circumstances Consultation will
commence in accordance with Clause 3.
At these times all available options will be considered prior to making any positions
redundant. The options to mitigate or avert the impact of redundancies will include,
but will not be limited to:
• The likely duration of the downturn / anticipated time of increased
workloads;
• The rate of natural attrition of Employees;
• The potential for redeployment within or outside the Employer for a short
time or permanently;
• The ability to have some or all Employees undertake work on a part time
basis for a period of time;
• The potential for Employees to take annual leave or long service leave.
Following consultation as per the above, the Employer will make its decisions based
on its known requirements.”
[2020] FWC 5432
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[17] It is uncontroversial that the Agreement required Varley to consult with employees
about the redundancies likely to result from the reduction in work on the MHC Project
(clauses 3 and 23.1 of the Agreement). The Agreement required Varley to consult about those
circumstances with the “relevant employees” (who are defined by the Agreement to be the
employees who may be affected by a change referred to in clause 3.6, being a major change
likely to have a “significant effect” on employees). In this case the relevant major change was
the reduction in work on the MHC Project (clause 3.1(a)) with the likely significant effect
being termination of employment (clause 3.6(a)). In relation to the relevant employees, the
Agreement required:
(a) Varley to notify the relevant employees of the decision to introduce the major
change,
(b) Varley to discuss the introduction of the change, the effect of the change, and the
measures Varley was taking to avert or mitigate against the adverse effect of the
change on employees,
(c) for the purposes of those discussions Varley to provide, in writing, all relevant
information about the change including its nature, information about the expected
effects of the change on the employees; and any other matters likely to affect the
employees,
(d) Varley to invite the relevant employees to give their views about the impact of the
change including any impact in relation to their family or caring responsibilities,
(e) Varley to give prompt and genuine consideration to matters raised about the
change by the relevant employees,
(f) Varley to consider options to mitigate or avert the impact of redundancies
including the anticipated time of increased workloads; rate of natural attrition; the
potential for redeployment within or outside Varley for a short time or
permanently; the ability to employees undertake work on a part time basis for a
period of time; and the potential for employees to take annual or long service
leave,
(g) the process to be undertaken in good faith, without prejudice, in a manner that
allows for fair consideration of the matters at hand while moving to resolve the
matter as quickly as practical, but does not require that consensus must be reached,
(h) the process must appropriately inform and engage employees, inviting and
considering their response and requires more than a mere exchange of information,
it requires that employees must be contributing to the decision-making process,
and
(i) following consultation as above, Varley will make its decisions based on its
known requirements.
[18] In relation to the obligation to consult, Logan J in Construction, Forestry, Mining and
Energy Union v BHP Coal Pty Ltd [2016] FCA 1009 (CFMEU v BHP Coal) relevantly said
at [59] to [60]:
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“59.While cl 47 of the Enterprise Agreement, set out above, gives “Consult” or
“Consultation” a particular meaning for the purposes of that agreement, that meaning
is not, in my view, at variance with a meaning which one might have given those
words in any event, having regard to prior authority. I had occasion to consider that
meaning in Communications, Electrical, Electronic, Energy, Information, Postal,
Plumbing and Allied Services Union of Australia v QR Limited (2010) 198 IR 382 in
which, at 395, [44] - [45], I observed:
44 … A key element of that content is that the party to be consulted be given
notice of the subject upon which that party’s views are being sought before any
final decision is made or course of action embarked upon. Another is that while
the word always carries with it a consequential requirement for the affording of
a meaningful opportunity to that party to present those views. What will
constitute such an opportunity will vary according the nature and
circumstances of the case. In other words, what will amount to “consultation”
has about it an inherent flexibility. Finally, a right to be consulted, though a
valuable right, is not a right of veto.
45 To elaborate further on the ordinary meaning and import of a
requirement to “consult” may be to create an impression that it admits of
difficulties of interpretation and understanding. It does not. Everything that it
carries with it might be summed up in this way. There is a difference between
saying to someone who may be affected by a proposed decision or course of
action, even, perhaps, with detailed elaboration, “this is what is going to be
done” and saying to that person “I’m thinking of doing this; what have you got
to say about that ?”. Only in the latter case is there “consultation”. …
An appeal from this judgment was subsequently dismissed by the Full Court.
60. In the present case, it is necessary not just to remind oneself that a person’s right to
be consulted does not confer any right of veto. It is also necessary to understand that
the cl 47 definition affirms what an ordinary understanding of the word, “consult”
would in any event suggest, which is that the obligation to consult does not carry with
it any obligation either to seek or to reach agreement on the subject for consultation.
Consultation is not an exercise in collaborative decision-making. All that is necessary
is that a genuine opportunity to be heard about the nominated subjects be extended to
those required to be consulted before any final decision is made. And it bears
repeating in this case that that final decision is not the existence of the particular
surplus. That genuine opportunity entails furnishing such information about the
occasion for consultation as is reasonably necessary for the making of suggestions in
respect of the subject for consultation and being receptive to any resultant suggestions.
It does not mean that one cannot approach consultation with a particular outcome in
mind, only that one’s mind not be unduly fixed.”
[19] In his written submissions, the Applicant rightly conceded that Varley undertook some
consultation leading up to his redundancy, that he was notified in accordance with the
Agreement, and that he was invited to make suggestions, ask questions or apply for a
voluntary redundancy. However, he argued that the process was superficial and not carried
out in the spirit of or in accordance with the Agreement. He said the process was more “a
[2020] FWC 5432
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mere exchange of information” rather than “Employees… contributing to the decision making
process.” In support of his submissions he relied on the proposition that “consultation is
providing the individual, or other relevant persons, with a bona fide opportunity to influence
the decision maker.”12
[20] The Respondent contended that it embarked on a genuine process of consultation
comprised of the following steps:
(a) On 8 April 2020, Varley notified Mr Nickle (AMWU Organiser) of its supply
issues and the possibility of this resulting in the loss of jobs via both phone and email.
(b) On 16 April 2020, Varley further notified Mr Nickle of these matters via email,
and sought to arrange a meeting with him to discuss them.
(c) On 21 April 2020, Varley met with Mr Nickle via phone and discussed its supply
issues and the upcoming scheduled ramp down, and its expectation that these issues
would result in the loss of jobs.
(d) On 23 April 2020, Varley met with Mr Nickle (via phone) and Mr Brett Fogarty
(AMWU site delegate) and discussed its supply issues and the upcoming scheduled
ramp down, its expectation that these matters would result in job losses, and measures
being considered in order to avert or mitigate this outcome.
(e) On 4 May 2020, Varley left a voicemail message for Mr Nickle to further discuss
these matters and emailed Mr Nickle stating that it intended to consult about these
matters with affected employees and implement redundancies that week.
(g) On 6 May 2020, Varley met with Mr Nickle and Mr Fogarty and indicated that
they would: (i) meet with employees on the MHC Project to consult about these
matters that afternoon; and (ii) then implement any redundancies. Mr Nickle and Mr
Fogarty accepted this course, and it was agreed that Mr Fogarty would attend the
meetings with employees.
(h) On 6 May 2020, Varley met with employees on the MHC Project in the presence
of Mr Fogarty and consulted with them about its supply issues and the upcoming
scheduled ramp down, its expectation that these matters would result in the loss of
jobs, and measures being considered in order to avert or mitigate this outcome.
Employees were also given the opportunity to apply for voluntary redundancy, or
otherwise raise any matters they wished for Varley’s consideration.
(i) Varley actively considered all the matters raised by the AMWU and employees in
the course of its consultation process and concluded eight jobs on the MHC project
were in excess of its needs and made those positions redundant.
[21] Varley argued that the consultation process described in the previous paragraph was
consistent with an “accepted practice” at Varley in which Varley first consulted with the
AMWU to thoroughly explore mitigation options before further consulting with employees
12 CPSU, the Community and Public Sector Union v Vodafone Network Pty Ltd, AIRC, 14 November 2001,
PR911257, [25] (Smith C)
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directly in a more limited manner. The Respondent sought to rely upon the “accepted
practice” in combination with its consideration of measures to avert or mitigate the need for
redundancies, the meeting with the MHC Project employees including the invitation to
provide any suggestions or ask questions, and that employees working on the MHC Project
would be anticipating a reduction of work due to scheduled ramp downs, to establish that
Varley had achieved “general compliance” with the consultation requirements of the
Agreement. On this point they relied upon the decision of a Full Bench of Fair Work
Australia upholding Commissioner Foggo’s decision in Tyszka v Sun Health Foods Pty Ltd
[2010] FWA 1781.13
Consideration – consultation
[22] Although some content of the discussions between Varley, Mr Nickle and Mr Fogarty
were contentious, it was not challenged, and I accept, that from 8 April 2020 until the
redundancies were made on 7 May 2020, Varley undertook significant consultation with the
AMWU through Mr Nickle and Mr Fogarty. That aspect of Varley’s consultation with the
union and its site delegate should be commended. I also accept that Varley gave detailed
consideration, in conjunction with the AMWU, to a range of measures to mitigate or avert the
need for redundancies including whether Varley could qualify for JobKeeper, whether
employees could take leave, redeployment opportunities, natural attrition, part-time work, and
voluntary redundancies – both on the MHC Project and site wide; but having considered those
measures, Varley concluded that no measures could mitigate or avert the need for
redundancies.14 Further, I accept Mr Moy’s evidence that employees, including Mr Crozier,
would have been aware of and anticipating that scheduled ramp downs as part of the MHC
Project would result in a reduction of available work on that project at some point in the
future, particularly because Varley had displayed, and the employees would often refer to, the
project schedules displayed near to their work area.
[23] In relation to the “accepted practice”, Varley adduced evidence that over a period of
years leading up to Mr Crozier’s redundancy an “accepted practice” had developed between
the AMWU and Varley whereby Varley initially consulted with the AMWU about issues such
as redundancy before consulting in a more limited way with the affected employees.15 In her
witness statement, Ms Dobbie provided one specific example of the “accepted practice” in
which two electricians were made redundant in a process which aligned with the “accepted
practice”, and attested that no issue was raised by Mr Wright, who was the notified of the
redundancies. Mr Wright accepted that Varley and the AMWU usually consulted about issues
such as redundancies prior to going to the workforce but rejected the assertion that
consultation with the employees would or should then be limited or not in compliance with
the requirements set out in the Agreement. Mr Wright also gave evidence that he had raised
concerns with Ms Dobbie in relation to his perception regarding a lack of consultation at
another Varley site. In response to the example provided by Ms Dobbie, Mr Wright explained
that no issue was raised in relation to the redundancy of the two electricians because he was
not notified until after the redundancies had been made and the employees had left site,
neither employee was a member of the AMWU, and he did not see it as the union’s role to
intervene in the redundancy of non-union members. Mr Wright’s rejection of any agreement
or acceptance of Varley’s “accepted practice” and his explanation as to why the AMWU
13 Appeal by Tyszka (C2010/3328), [291] – [292] (Tyszka)
14 Witness statement of Jan Dobbie at [21] – [29]
15 Witness statement of Jan Dobbie at [9]; Witness statement of Wayne Moy at [14]
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conducted itself as it did in relation to the electricians made redundant by Varley was
convincing. This is particularly so in light of his evidence, which I accept, that he, and the
AMWU, seek to ensure meaningful consultation occurs between employers and employees by
negotiating robust consultation clauses. Thus, on the evidence before me I am not persuaded
by the Respondent’s contention that an “accepted practice” had developed between Varley
and the AMWU by which Varley would initially consult with the AMWU before consulting
in a more limited way with the affected employees, although I do accept that Varley often
undertook consultation in that manner.
[24] I accept Ms Dobbie’s and Mr Moy’s evidence that Varley’s consultation with the
MHC Project employees, including Mr Crozier, was comprised of the following steps:
On 6 May 2020, Mr Moy and Ms Dobbie met with a group of employees on the
MHC Project (including Mr Crozier) in the presence of Mr Fogarty and orally
delivered information to the relevant employees about Varley’s COVID-19 related
supply issues and the upcoming scheduled ramp down, its expectation that these
matters would result in the loss of jobs, measures being considered in order to avert
or mitigate this outcome (including voluntary redundancies), and in general terms
the criteria used to select individuals for redundancy.
At the meeting on 6 May 2020, both Mr Moy and Ms Dobbie invited the
employees present to approach Mr Moy, Ms Dobbie or Mr Fogarty with any
questions or suggestions about the redundancies, whether they would like to take
voluntary redundancy and/or whether they would like more information about what
a voluntary redundancy would look like (for example, the amount of redundancy
pay). Employees were not told on 6 May 2020 who had been selected for
redundancy.
Mr Moy and Ms Dobbie made it clear in the 6 May 2020 meeting that Varley had
decided to move quickly so any suggestions or questions should be brought to their
attention promptly.
[25] I also accept Ms Dobbie’s evidence that Varley chose to conduct the consultation with
the relevant employees as quickly as practical “not only because we do not want to contribute
to employee anxiety, but also because we do not want to introduce any risk on our safety-
critical projects by having employees distracted from their work”.16 Further, I accept Ms
Dobbie’s evidence that, after consultation with the AMWU, Varley decided not to raise the
option of employees taking leave instead of being made redundant because she formed the
view that it would not be effective as the relevant employees had limited supplies of annual
and long service leave.17 And, I accept Ms Dobbie’s evidence that Varley chose not to raise
the possibility of employees reducing their hours of work because Varley came to the
conclusion that not enough employees would take up the option to have the desired effect.18
Finally, I accept that these considerations were discussed with the AMWU before Varley
commenced their consultation with the MHC Project employees on 6 May 2020.
16 Witness statement of Jan Dobbie at [30]
17 Witness statement of Jan Dobbie at [21]
18 Ibid
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[26] With respect to the meeting between Varley and the employees on the MHC Project
on 6 May 2020, Mr Crozier gave evidence, which I accept, that he was standing around the
back of about 20 other employees during the meeting and although there was an invitation to
employees to ask questions or give suggestions he did not do so because he was trying to take
in and understand what he was being told. In relation to the period between the meeting in
which Mr Crozier was notified of the possibility that eight employees on the MHC Project
would be made redundant (about midday on 6 May 2020) and when the redundancies were
made (about 4pm the next day) I accept Mr Crozier’s evidence that he did not approach Mr
Moy or Ms Dobbie about the redundancies because he anticipated there being further
meetings, he felt secure in his position and did not think that he was going to be made
redundant as he believed he was in permanent employment and that he had a good skill set
which would be useful to Varley on other projects. He also gave evidence, which I accept,
that in the relevant period, he completed his day’s work and returned to work the next
morning and worked up until when his employment was terminated. I also accept Mr
Crozier’s unchallenged evidence that he was not made aware that he was specifically being
considered for, or had been selected for, redundancy until he was told so in the meeting at
about 4pm on 7 May 2020, at which time his employment was terminated with immediate
effect.
Conclusion – consultation
[27] For the following reasons, Varley failed to comply with its obligations in the
Agreement to consult about the redundancies with Mr Crozier.
[28] First, Varley did not provide any written information to the relevant employees (as
required by clause 3.4(b) of the Agreement). This is important because not only does it not
comply with the explicit requirements of the Agreement, but it undermines the quality of the
discussions which follow the provision of written information to employees,19 which is why
clause 3.4(b) makes it clear that the written information is “for the purposes of the
discussions”.
[29] Secondly, Varley’s obligation to invite Mr Crozier’s views about the redundancies and
their impact on his family and caring responsibilities brought with it a “consequential
requirement for the affording of a meaningful opportunity to that party to present those
views”.20 Of course, to present his views Mr Crozier would have required sufficient time and
information to form a view on those matters. In relation to the consultation conducted
between Varley and the AMWU, I accept Varley’s contention that those discussions could
have made consultation with the relevant employees more efficient and less time consuming
than may otherwise have been the case. However, those discussions could not abdicate
Varley’s obligation to properly consult with the relevant employees in accordance with the
Agreement. The circumstances and very short period of time between Mr Crozier being
invited to give his views about the redundancies on the MHC Project and his position actually
being made redundant undermined any real opportunity for Mr Crozier to engage with Varley.
The relevant period was about 28 hours and included finishing his work on 6 May 2020 and
working a full day on 7 May 2020. As Mr Crozier put it, that was a period “which isn’t long
to make decisions on your life and your family”. Further, Mr Crozier was not even aware of
nor did he suspect that he specifically would be chosen for redundancy until the meeting in
19 Manescu v Baker Hughes Australia Pty Limited [2018] FWCFB 403, [32] – [33]
20 CFMEU v BHP Coal at [59]
[2020] FWC 5432
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which his employment was terminated on 7 May 2020. On no view of those circumstances
could it be said that Mr Crozier was given a meaningful opportunity to present his views or to
contribute to the decision making process in any real way. For example, because Mr Crozier
was not told until about 4pm on 7 May 2020 that he had been selected for redundancy and
was to be terminated that afternoon, he did not have any real opportunity to speak to his work
colleagues to see if any of them may be interested in working part time and job sharing with
him. Although it may not have been possible, as Mr Dobbie believed, for enough employees
to volunteer for job sharing to save all eight positions to be made redundant, it may have been
possible to save Mr Crozier’s job. In my view, the circumstances and period of time available
did not allow for consultation to be undertaken in a manner that allowed for fair consideration
of the matters at hand as required by the Agreement.
[30] Although I did not understand the Respondent to put its case in this way, I will also
deal with the possibility that the evidence could establish that the “accepted practice” was a
manifestation of a commonly understood meaning of the requirements of the consultation
clause, and therefore Varley’s compliance with the “accepted practice” meant that it complied
with the Agreement. Relevantly, Gray ACJ in Shop Distributive and Allied Employees’
Association v Woolworths Ltd [2006] FCA 616; (2006) 151 FCR 513 (SDA v Woolworths),
520 at [31] explained:
“There is authority that, if a provision has appeared in a series of agreements between
the same parties, and if they can be shown to have conducted themselves according to
a common understanding of the meaning of that provision, then it can be taken that
they have agreed that the term should continue to have the commonly understood
meaning in the current agreement. See Merchant Service Guild of Australia v Sydney
Steam Collier Owners & Coal Stevedores Association (1958) 1 FLR 248 at 251 per
Spicer CJ, 254 per Dunphy J and 257 per Morgan J, and Printing & Kindred
Industries Union v Davies Bros Ltd (1986) 18 IR 444 at 452–453. It is necessary to
take great care in the application of this limited principle, to avoid infringing the
general principle that the conduct of parties to an agreement cannot be taken into
account in construing the agreement. For the limited principle to operate, there must
be clear evidence that the parties have acted upon a common understanding as to the
meaning of the relevant provision and not for other reasons, such as common
inadvertence as to its true meaning. See Australian Liquor, Hospitality and
Miscellaneous Workers Union v Prestige Property Services Pty Ltd [2006] FCA 11 at
[44].”
[31] There is no “clear evidence” in this case that the parties have acted upon a common
understanding as to the meaning of the consultation provisions in the Agreement. I accept
Varley’s evidence that the redundancy process has been conducted in line with the “accepted
practice” in the past, however, that is a long way from establishing that there was an
understanding common to the AMWU, the employees and Varley that the consultation clause
in the Agreement would be satisfied by such a process. This is particularly so in light of Mr
Wright’s explicit rejection of any common understanding and his compelling evidence in
reply to the Respondent’s evidence and submissions in relation to the redundancies of the two
electricians earlier in 2020, which I have accepted above.
[32] For completeness, and although I have doubts about the correctness of the decision of
the Full Bench in Tyszka, Varley’s significant failures in relation to consulting with Mr
[2020] FWC 5432
14
Crozier establish that Varley did not achieve any “general compliance” with the consultation
obligations under the Agreement.
Whether reasonable in all the circumstances for the person to be redeployed (s 389(2))
[33] For the purposes of section 389(2) of the Act, the Commission must consider whether
there was a job or a position or other work within the employer’s enterprise (or that of an
associated entity) to which it would have been reasonable in all the circumstances to redeploy
the dismissed employee. There must be an appropriate evidentiary basis for such a finding.21
The word “redeployed” in section 389(2) of the Act should be given its ordinary and natural
meaning, which is to “transfer to another job, task or function”.22
[34] If an employer wishes to rely on the “genuine redundancy” exclusion in section 389 of
the Act, then it would ordinarily be expected to adduce evidence, on the question of
redeployment, as to whether there was a job or a position or other work within the employer’s
enterprise (or that of an associated entity) to which it would have been reasonable in all the
circumstances to redeploy the dismissed employee. Such evidence would usually include the
steps taken by the employer to identify other jobs, positions or work which could be
performed by the dismissed employee.23
[35] Whether it would have been reasonable in all the circumstances for the person to be
redeployed, directs attention to the circumstances which pertained when the person was
dismissed.24 However, the circumstances leading up to the time the employee was dismissed
may, in particular cases (such as where there has been a redeployment period for an employee
prior to their dismissal), be relevant to a determination of whether it would have been
reasonable in all the circumstances for the employee to have been redeployed.25
[36] In determining whether redeployment would have been reasonable a number of
matters may be relevant, including:
(a) whether there exists a job or position or other work to which the employee can be
redeployed;26
(b) the nature of any available position;27
(c) qualifications required to perform the job;28
21 Technical and Further Education Commission T/A TAFE NSW v Pykett [2014] FWCFB 714; (2014) 240 IR 130 (TAFE) at
[36]
22 Ibid at [25]
23 Ibid at [36]-[37]; Teterin & Ors v Resource Pacific Pty Limited t/a Ravensworth Underground Mine [2014] FWCFB 4125;
(2014) 244 IR 252 (Teterin) at [28]-[29]
24 TAFE at [24] & [35]; Ulan Coal Mines Ltd v Honeysett [2010] FWAFB 7578; (2010) 199 IR 363 (Ulan Coal 2) at [28]
25 Bhalla v Welltech Total Water Management [2014] FWC 7565 at [55]
26 Ulan Coal 2 at [28]
27 Ibid at [28]
28 Ibid at [28]
[2020] FWC 5432
15
(d) the employee’s skills, qualifications and experience. The employee should have
the skills and competence required to perform the role to the required standard
either immediately or within a reasonable period of retraining;29 and
(e) the location of the job in relation to the employee’s residence and the
remuneration which is offered.30
[37] Where an employer decides that, rather than fill a vacancy by redeploying an
employee into a suitable job in its own enterprise, it will advertise the vacancy and require the
employee to compete with other applicants, it might subsequently be found that the resulting
dismissal is not a case of genuine redundancy.31
[38] It is important, however, to appreciate that, because there is a requirement to assess the
reasonableness of redeployment “in all the circumstances”, it is not possible to establish
binding or decision rules concerning the application of section 389(2) of the Act in all cases;
the circumstances of each particular case must be considered.32
Consideration – redeployment
[39] The Respondent contends that no redeployment opportunities existed at the time it
made Mr Crozier redundant on 7 May 2020. The Applicant submitted that he could
reasonably have been redeployed to one of six positions which were advertised by Varley on
12 May 2020 or to work on the emergency vehicle projects at the Tomago site.
[40] The advertisement placed by Varley on 12 May 2020 was for six qualified
tradespeople with skills including MIG welding to work on a new project. In relation to those
positions, Ms Dobbie gave unchallenged evidence, which I accept, that: the new project
referred to in the advertisement arose from a quote which Varley had provided to one of its
rail sector clients to undertake retro-fitting and repair work on coal wagons in around 2018,
during the intervening two years Varley formed the view that the potential work had “gone
cold” but received an informal indication that the client was planning to proceed with the
quote on 11 May 2020, the client did not formally engage Varley on that work until 25 May
2020, and it was not until 22 June 2020 and 13 July 2020 that Varley engaged each of the two
additional boilermakers to undertake the work.33 What is apparent from that evidence is that
leading up to and including 7 May 2020 the positions advertised on 12 May 2020 were not
positions which it would have been reasonable for Varley to redeploy Mr Crozier to in the
circumstances which pertained at the time of his dismissal, because those positions did not
exist and Varley was not aware that they may come into existence until at least 11 May 2020.
[41] With respect to the emergency vehicle projects, Mr Crozier gave evidence that leading
hands at Varley sought his interest around the time he was made redundant in work on “new
tenders” or “if they got the contract” in relation to emergency service vehicle projects. In
response, Ms Dobbie gave evidence that Varley has not been awarded any new contract nor
been engaged on additional projects in relation to emergency service vehicles during 2020.
29 Ibid at [28] & [34]
30 Ibid at [28]
31 Ibid at [34]
32 Teterin at [35]
33 Witness statement of Jan Dobbie at [40]
[2020] FWC 5432
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Mr Moy gave evidence that there was no work available for Mr Crozier on any of its Tomago-
based projects including its emergency service vehicle projects at the time Mr Crozier was
made redundant. Both Mr Moy and Ms Dobbie gave evidence that leading hands were not
authorised to seek expressions of interests from employees regarding work on other projects,
although Mr Moy accepted in cross-examination that those conversations could have
occurred. I accept Mr Crozier’s evidence that he had conversations with leading hands at
Varley in which they sought his interest in working on potential new projects related to
emergency service vehicles at the Tomago site. However, I also accept the evidence of the
Respondent that no new projects or additional work on emergency service vehicles have been
won by Varley during 2020 and that there was otherwise no work available for Mr Crozier on
the emergency service vehicle projects at the time he was made redundant. Therefore, it could
not have been reasonable in the circumstances for Varley to redeploy Mr Crozier to work on
emergency service vehicle because no such work existed at the relevant time.
[42] Finally, and in light of the above findings, I accept Mr Moy’s and Ms Dobbie’s
evidence that they took steps to seek out redeployment opportunities including investigating
the availability of positions or work at Tomago and other Varley sites, and that despite taking
those steps, no reasonable redeployment opportunities existed at Varley or any associated
entity at the time Mr Crozier was made redundant.
Conclusion – redeployment
[43] For the reasons stated above, I am satisfied that it would not have been reasonable in
all the circumstances for Mr Crozier to have been redeployed within Varley’s enterprise or an
enterprise of an associated entity of Varley. I am satisfied on the evidence that the positions I
have considered in paragraphs [39] to [41] are all the positions into which it may possibly
have been reasonable for Varley to redeploy Mr Crozier within its enterprise or an enterprise
of an associated entity of Varley.
Section 387(a) – valid reason related to capacity or conduct
[44] If an employee has been dismissed because of changes to the operational requirements
of their employer’s enterprise, the reason for the dismissal will not be related to the
employee’s capacity or conduct. It follows that, in those circumstances, there will not be a
valid reason for the dismissal related to the employee’s capacity or conduct, and s 387(a)
should be regarded as a neutral matter with respect to the question of whether the dismissal
was harsh, unjust or unreasonable.34
[45] However, if the employee was dismissed because of changes to the operational
requirements of their employer’s enterprise and it was not reasonable in all the circumstances
for the employer to redeploy him or her, they are matters which should be considered under s
387(h) of the Act and are telling against a conclusion that the dismissal was harsh, unjust or
unreasonable.35
34 UES (Int’l) Pty Ltd v Harvey [2012] FWAFB 5241 (UES) at [42]; Ventyx Pty Ltd v Murray [2014] FWCFB 2143 (Ventyx)
at [142]
35 UES at [33] & [47]
[2020] FWC 5432
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[46] For the reasons set out above, I am satisfied that Mr Crozier was dismissed because of
changes to the operational requirements of Varley’s enterprise. Accordingly, s 387(a) is a
neutral factor in this case.
Section 387(b) – notification of reason
[47] Section 387(b) relates to notification of “that reason”, being a reason related to the
person’s capacity or conduct.36
[48] Because the reason for the termination of Mr Crozier’s employment was the
redundancy of his job and such a reason is not related to his capacity or conduct, s 387(b) is a
neutral factor in relation to the question of whether Mr Crozier’s dismissal was harsh, unjust
or unreasonable.37
Section 387(c) – opportunity to respond
[49] Section 387(c) is also predicated on there being a reason for dismissal related to the
capacity or conduct of the employee.38
[50] It follows that s 387(c) is a neutral factor in relation to the question of whether Mr
Crozier’s dismissal was harsh, unjust or unreasonable.39
Section 387(d) – support person
[51] Varley did not unreasonably refuse to allow Mr Crozier to have a support person
present to assist at any discussions relating to his dismissal. Accordingly, s 387(d) is a neutral
factor in relation to the question of whether Mr Crozier’s dismissal was harsh, unjust or
unreasonable. 40
Section 387(e) – warning about unsatisfactory performance
[52] Mr Crozier’s dismissal did not relate to any unsatisfactory performance by him. It
follows that s 387(e) is also a neutral factor in relation to the question of whether Mr Crozier’s
dismissal was harsh, unjust or unreasonable.41
Section 387(f)&(g) – size of enterprise and dedicated human resource management
specialists
[53] I am satisfied on the evidence that Varley is a relatively large enterprise and has
significant internal human resource management. Accordingly, s 387(d) is a neutral factor in
relation to the question of whether Mr Crozier’s dismissal was harsh, unjust or unreasonable.
36 UES at [43]; Ventyx at [143]
37 UES at [43]; Ventyx at [143]
38 UES at [43]; Ventyx at [144]
39 UES at [43]; Ventyx at [144]
40 UES at [44]
41 UES at [45]; Ventyx at [146]
[2020] FWC 5432
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Section 387(h) – other relevant matters
[54] There were sound, defensible and well-founded reasons for Mr Crozier’s dismissal,
namely Varley no longer required his job to be performed by anyone because of changes to
the operational requirements of Varley’s enterprise. Further, as I have concluded above, there
were no reasonable redeployment opportunities available for Mr Crozier. These matters weigh
against a conclusion that the dismissal was harsh, unjust or unreasonable.42 Varley’s material
failure to comply with its consultation obligations under the Agreement is also a relevant
matter which should be considered pursuant to s 387(h) of the Act.43 However, a failure to
consult does not necessarily mean a dismissal was harsh, unjust or unreasonable.44 The weight
to be given to a failure to consult depends primarily on the degree to which, if any, the
absence of proper consultation led to any unfairness in practice.45
[55] My view is that a proper consultation period which complied with the requirements of
the Agreement would have lasted a further week after 7 May 2020. Although one week is a
relatively short time amount of time, I am persuaded that it is the amount of time which would
have been required because of the consultation already undertaken between the AMWU and
Varley and Varley’s thorough consideration of ways to mitigate or avert the redundancies
conducted prior to engaging with the relevant employees.
[56] The Applicant contended that even if there were no redeployment opportunities
available at the time he was made redundant, had proper consultation taken place and
continued for at least one week, he would have been redeployed to one of the positions
advertised by Varley on 12 May 2020. The Applicant submits that as there were ultimately
two boilermaker positions created and there were two boilermakers made redundant on the
MHC Project both of the boilermakers made redundant could have been tested for the
positions and, if they were suitably skilled could have been asked to take leave or perform
other work until the positions commenced.46 He also says that because of his qualifications
and experience it is likely he would have passed the welding test that would have been
required, been offered the position, and on the balance of probabilities he would still be
employed by Varley. Varley argued that the two metal tradesperson roles ultimately created at
Varley’s Carrington site did not become true vacancies until at least late June 2020 and an
extended consultation period would not have continued the Applicant’s employment to that
date such that he might have been redeployed into one of those roles.
[57] I am not satisfied, on the balance of probabilities, that had Varley conducted proper
consultation with Mr Crozier that he would have been employed in one of the positions
advertised by Varley on 12 May 2020. I accept that it is more likely than not that placing Mr
Crozier into one of the six positions advertised on 12 May 2020 would have been considered
by Varley had he still been employed at that time. Ms Dobbie gave evidence that she was
aware of those positions by that date and was intimately involved in Mr Crozier’s dismissal
and considering options to avoid or mitigate the redundancies. I also accept Mr Crozier’s
evidence, which was not contested, that he had the necessary skills to at least apply for the
positions. However, I am not satisfied, on the balance of probabilities, that Varley would have
42 UES at [33] & [47]; Ventyx at [149]-[150]
43 UES at [48]
44 UES at [49]; Maswan at [39]; Ventyx at [151]-[162]
45 Gomes v OE & DR Pope Pty Ltd [2014] FWC 8342 at [59] per Hampton C
46 Applicant’s submissions in reply at [27]
[2020] FWC 5432
19
offered Mr Crozier one of the positions prior to him being made redundant for the following
reasons. As Ms Farrar submitted, one cannot determine the likelihood of Mr Crozier being
offered one of the advertised positions by reference to the events which actually transpired.
The correct approach is to consider the situation and state of knowledge in the hypothetical
seven day period (from 8 to 14 May 2020) during which Mr Crozier would have remained in
employment. As at 12 May 2020 the positions did not actually exist and there was no
certainty that they would be required in the future, or if so, when they would be required. The
job advertisement for the positions stated that “the project is currently scheduled to start in
approximately 4 weeks”. However, as at 25 May 2020 Varley had not been engaged by their
client to undertake the project. It was not until the client engaged Varley in about June 2020
to undertake the project that Varley could and did make a decision about its additional labour
needs and consequently employed two additional boilermakers. They commenced
employment on 22 June 2020 and 13 July 2020 respectively. Having regard to the state of
knowledge in the period from 8 to 14 May 2020, Varley was not in a position to offer Mr
Crozier an alternative position because it did not have one available. The best it could have
done would have been to say that a position for which Mr Crozier may have been suitable,
subject to his welding and other skills meeting the required standard, may become available at
some unknown time in the future. Mr Crozier only had about 28 hours of paid leave available
at that time. It is possible that Mr Crozier could have sought unpaid leave for an unknown
period of time to see if the project would proceed, but the prospect of such leave being sought
and granted does not seem very high. In all the circumstances, I find on the balance of
probabilities that Mr Crozier would not have remained in employment after 14 May 2020
even if he had been employed and consulted with in the period from 8 to 14 May 2020.
[58] Like the situation in cases such as Maswan (at [39]) and Smith v Alice Care Care
Centre Pty47 (at [53]), I am satisfied in the particular circumstances of this case that if
consultation in accordance with the requirements of the Agreement had occurred, “it would
have made no difference to the ultimate outcome”.48 Although I have concluded no different
outcome would have resulted had proper consultation been undertaken, Varley’s abject failure
to properly consult with Mr Crozier (as detailed above at paragraphs [19] to [29]) gives
weight to his argument that his dismissal was unreasonable. Further, although I am not
satisfied that Mr Crozier would have been offered one of the positions advertised by Varley
on 12 May 2020, his loss of the opportunity to be considered for placement into one of those
positions while still employed by Varley gives weight to his argument that his dismissal was
harsh.
[59] Mr Crozier argued that Varley’s decision to terminate his employment was
unreasonable on the basis that he, as a boilermaker, was selected for redundancy when
another boilermaker had expressed interest in accepting a voluntary redundancy but was
rejected by Varley and that an employee described by Mr Crozier as a “contractor” was
retained when he was dismissed. Varley submitted that there were sound and defensible
reasons for acting as it did. I accept the evidence of Mr Moy that the boilermaker who Mr
Crozier says volunteered for redundancy was retained by Varley because of his extensive
skillset across the entire MHC Project as opposed to Mr Crozier’s more limited skillset. That
is a reasonable basis to select Mr Crozier over the other employee. Further, I accept Ms
Dobbie’s evidence that the “contractor” was not a “contractor” but was a fixed term employee
engaged on the MHC Project whose contract expired sometime in June 2020. My view is that
47 Ltd [2013] FWC 9093 (Alice Car Care Centre)
48 Alice Car Care Centre at [53]
[2020] FWC 5432
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there is no apparent unreasonableness in selecting Mr Crozier over an employee on a fixed
term contract where that fixed term contract was to expire approximately a month in the
future, but had yet to do so.
[60] Mr Crozier also submitted that his selection for redundancy was unfair because he was
unaware of the underlying selection criteria used to select him for redundancy and therefore
he had no opportunity to put forward a case as to why he should not be selected. The
Respondent submitted that little weight should be given to Mr Crozier’s contention that the
selection process was unfair because the Applicant’s case did not initially proceed on that
basis and therefore it was unsurprising that the Respondent filed little material on that point.
Further, the Respondent submitted that the evidence of Mr Moy regarding the selection
criteria used in deciding which employees to make redundant established that Mr Crozier’s
selection was reasonable and fair. I am satisfied on the evidence that Mr Crozier’s selection
for redundancy was not unfair. Mr Moy gave unchallenged evidence, which I accept, that the
selection process used by Varley involved assessing the skills required by Varley and the
employee’s ranking as compared to other employees. He also gave evidence, which I accept,
that the rankings relied upon were compiled by Varley as part of a yearly review and were
based on, among other things, performance, attendance, willingness to learn, skills and quality
of work as demonstrated over the last 12 months. Mr Crozier was ranked at or near the bottom
of the list of employees. On the evidence before me, I am satisfied that Varley had a
reasonable basis for selecting the employees it chose to make redundant. Hence, Mr Crozier’s
inability to challenge, or ask questions about, the basis upon which he was selected for
redundancy supports his argument that Varley failed to consult with him in accordance with
its obligations under the Agreement, but it does not otherwise persuade me that his dismissal
was harsh, unjust or unreasonable.
[61] Finally, Mr Crozier submitted he has had little success in finding new employment and
is unlikely to find work given his age (58) and the current job market. Varley submitted the
fact that Mr Crozier was aware of but did not apply for the positions advertised on 12 May
2020 should weigh against a conclusion that his inability to find new employment makes his
dismissal harsh. In relation to this issue, Mr Crozier gave evidence that he did not apply for
the 12 May positions because at the time he saw the advertisement he felt rejected and
unwanted by Varley and did not think he would be considered for the positions. He also gave
evidence, which I accept, that had he retained his employment with Varley he would have
applied for one of the positions advertised in May; in his words “a job is a job”. I am not
persuaded by Varley’s submission. Mr Crozier’s decision to not apply for one of the
advertised positions was reasonable in the context of his perception that Varley had rejected
and did not want him. Mr Crozier’s lack of success in finding new employment supports his
contention that his dismissal was harsh, but it must be weighed against the sound and well-
founded reason for his dismissal and all other relevant considerations.
Conclusion – harsh, unjust and/or unreasonable dismissal
[62] After considering each of the matters specified in s 387 of the Act, my evaluative
assessment is that Varley’s dismissal of Mr Crozier was harsh and unreasonable. Although
Varley had a valid reason to make Mr Crozier’s position redundant, Varley’s unreasonable
and extensive failure to comply with its consultation obligations in relation to Mr Crozier
meant that he had no real opportunity to consider and form a view on his possible redundancy
and present those views to Varley prior to being dismissed only 28 hours after first hearing
that employees on the MHC Project would be made redundant. In the result, Mr Crozier was
[2020] FWC 5432
21
dismissed in circumstances where I am satisfied on the balance of probabilities that
compliance with Varley’s consultation obligations would have resulted in Mr Crozier
working for a further 7 days and being considered for the positions advertised by Varley on
12 May 2020. Although I have not found, on the balance of probabilities, Mr Crozier would
have been offered one of those positions, the loss of that opportunity because of Varley’s
unreasonable failure to consult rendered his dismissal harsh, particularly in circumstances
where he has not been able to obtain alternative employment.
Remedy
[63] Having found that Mr Crozier was protected from unfair dismissal, and that his
dismissal was harsh and unreasonable, it is necessary to consider what, if any, remedy should
be granted to him. Mr Crozier sought the remedy of reinstatement. The Respondent submitted
that would be inappropriate because no position currently exists for which Mr Crozier could
be employed.
[64] During the hearing, the Applicant put to Ms Dobbie a screenshot of an advertisement
which currently appears on Varley’s public website titled “Quick Hire” which provides:
“PLEASE do not click on this role unless a member of the Varley team has instructed
you to do so. THANKS!
Job type: Casual
Location: Tomago NSW, Carrington NSW, West Gosford NSW, Yennora / Sydney
NSW, Wendouree / Ballarat VIC, Mentone / Melbourne VIC, Narangba / Brisbane
QLD, Maddington / Perth WA Show less
Closing date: Thursday, 31 December 2020
APPLY NOW MORE INFO”
[65] I accept Ms Dobbie’s unchallenged evidence that this advertisement is not in relation
to any existing position. Ms Dobbie explained that the advertisement is in place to be used by
individuals in the event that they are recruited directly by Varley for positions that have not
been advertised. The link to apply is used to provide the individual a link into Varley’s job
portal so that they can submit the relevant documents. I am satisfied that the “Quick Hire”
advertisement does not evidence any currently existing position into which Mr Crozier could
be employed. Further, Mr Crozier’s position is redundant, and I accept Ms Dobbie’s and Mr
Moy’s evidence that there is currently no job at Varley for which Mr Crozier could be
employed. I am satisfied that it would be inappropriate to reinstate Mr Crozier in all the
circumstances.
[66] Section 390(3)(b) of the Act provides the Commission may only issue an order for
compensation if it is appropriate in all the circumstances. A compensation remedy is designed
to compensate an unfairly dismissed employee in lieu of reinstatement for losses reasonably
attributable to the unfair dismissal within the bounds of the statutory cap on compensation
that is to be applied.49
49 Kable v Bozelle, Michael Keith T/A Matilda Greenbank [2015] FWCFB 3512 at [17]
[2020] FWC 5432
22
[67] Having regard to all the circumstances of the case, including the fact that Mr Crozier
has suffered financial loss as a result of his unfair dismissal, I consider that an order for
payment of compensation to him is appropriate.
[68] It is necessary therefore for me to assess the amount of compensation that should be
ordered to be paid to Mr Crozier. In assessing compensation, I am required by s 392(2) of the
Act to take into account all the circumstances of the case including the specific matters
identified in paragraphs (a) to (g) of this subsection.
[69] I will use the established methodology for assessing compensation in unfair dismissal
cases which was set out in Sprigg v Paul Licensed Festival Supermarket50 and applied and
elaborated upon in the context of the current Act by Full Benches of the Commission in a
number of cases.51 The approach to calculating compensation in accordance with these
authorities is as follows:
Step 1: Estimate the remuneration the employee would have received, or have been
likely to have received, if the employer had not terminated the employment
(remuneration lost).
Step 2: Deduct monies earned since termination.
Step 3: Discount the remaining amount for contingencies.
Step 4: Calculate the impact of taxation to ensure that the employee receives the actual
amount he or she would have received if they had continued in their employment.
Step 5: Apply the legislative cap on compensation.
Remuneration Mr Crozier would have received, or would have been likely to receive, if he
had not been dismissed (s 392(2)(c))
[70] Like all calculations of damages or compensation, there is an element of speculation in
determining an employee’s anticipated period of employment because the task involves an
assessment of what would have been likely to happen in the future had the employee not been
dismissed.52
[71] I am satisfied on the balance of probabilities that if Mr Crozier had not been dismissed
on the grounds of redundancy on 7 May 2020 because consultation in accordance with the
Agreement was still being undertaken, his employment would have terminated at the
conclusion of a proper consultation process, which would have lasted one further week. That
is, Mr Crozier would have been made redundant on 14 May 2020. My reasons are as follows.
First, for the reasons provided at paragraph [55], I am satisfied that if Varley had complied
with its consultation obligations Mr Crozier would have remained working for Varley until 14
May 2020 while that consultation took place. Second, for the reasons provided at paragraphs
50 (1998) 88 IR 21
51 Tabro Meat Pty Ltd v Heffernan [2011] FWAFB 1080; Read v Golden Square Child Care Centre [2013] FWCFB 762;
Bowden v Ottrey Homes Cobram [2013] FWCFB 431
52 Double N Equipment Hire Pty Ltd v Humphries [2016] FWCFB 7206 at [16]-[17]
[2020] FWC 5432
23
[56] – [57] above, I am satisfied that the longer consultation period would not have resulted in
any further period of employment beyond the consultation period.
[72] Mr Crozier was employed for 38 hours per week and was paid, at the time of his
dismissal, $39.59 per hour: 38 hours x $39.59 = $1,504.42. Hence, I am satisfied that if Mr
Crozier had remained employed from 8 May 2020 until 14 May 2020 (inclusive) he would
have received $1,504.42.
Remuneration earned (s 392(2)(e)) and income reasonably likely to be earned (s 392(2)(f))
[73] In the period from 8 May 2020 until 14 May 2020 (inclusive), Mr Crozier did not
receive any remuneration.
[74] Thus, my view is that $1,504.42 is the gross amount of remuneration Mr Crozier
would likely have earned had he not been dismissed by Varley and instead continued to be
employed until the conclusion of a further one week period commencing on 8 May 2020 and
concluding on 14 May 2020. This calculation is intended to put Mr Crozier in the position he
would have been in but for the termination of his employment.53
Viability (s 392(2)(a))
[75] No submission was made on behalf of Varley that any particular amount of
compensation would affect the viability of Varley’s enterprise.
[76] My view is that no adjustment is required on this account.
Length of service (s 392(2)(b))
[77] My view is that Mr Crozier’s period of service with Varley (about 3 years) does not
justify any adjustment to the amount of compensation.
Mitigation efforts (s 392(2)(d))
[78] The evidence establishes that Mr Crozier has made reasonable efforts to obtain
alternative employment following his dismissal on 7 May 2020. But, unsurprisingly in the
current environment, Mr Crozier has not been able to obtain alternative employment.
[79] In all the circumstances, my view is that Mr Crozier acted reasonably to mitigate the
loss suffered by him because of the dismissal and I do not consider it appropriate to reduce the
compensation on this account.
Any other relevant matter (s 392(2)(g))
[80] It is necessary to consider whether to discount the remaining amount ($1,504.42) for
“contingencies”. This step is a means of taking into account the possibility that the occurrence
of contingencies to which Mr Crozier was subject might have brought about some change in
53 Bowden at [24], citing Ellawala v Australian Postal Corporation Print S5109 at [35]
[2020] FWC 5432
24
earning capacity or earnings.54 Positive considerations which might have resulted in
advancement and increased earnings are also taken into account.
[81] The discount for contingencies should only be applied in respect to an “anticipated
period of employment” that is not actually known, that is a period that is prospective to the
date of the decision.55
[82] Because I am looking in this matter at an anticipated period of employment which has
already passed (8 May 2020 until 14 May 2020), there is no uncertainty about Mr Crozier’s
earnings, capacity or any other matters during that period of time. In all the circumstances, my
view is that it is not appropriate to discount or increase the figure of $1,504.42 for
contingencies.
[83] Save for the matters referred to in this decision, my view is that there are no other
matters which I consider relevant to the task of determining an amount for the purposes of an
order under s 392(1) of the Act.
[84] I have considered the impact of taxation, but my view is that I prefer to determine
compensation as a gross amount and leave taxation for determination.
Misconduct (s 392(3))
[85] Mr Crozier did not commit any misconduct, so my view is that this has no relevance to
the assessment of compensation.
Shock, distress or humiliation, or other analogous hurt (s 392(4))
[86] I note that in accordance with s 392(4) of the Act, the amount of compensation
calculated does not include a component for shock, humiliation or distress.
Compensation cap (s 392(5)-(6))
[87] The amount of $1,504.42 is less than half the amount of the high income threshold
immediately before the dismissal. It is also less than the total amount of remuneration to
which Mr Crozier was entitled in his employment with Varley during the 26 weeks
immediately before his dismissal. In those circumstances, my view is that there is no basis to
reduce the amount of $1,504.42 by reason of s 392(5) of the Act.
Instalments (s 393)
[88] No application has been made to date by Varley for any amount of compensation
awarded to be paid in the form of instalments.
54 Ellawala v Australian Postal Corporation Print S5109 at [36]
55 Enhance Systems Pty Ltd v Cox PR910779 at [39]
[2020] FWC 5432
25
Conclusion on compensation
[89] In my view, the application of the Sprigg formula does not, in this case, yield an
amount that is clearly excessive or clearly inadequate. Accordingly, my view is that there is
no basis for me to reassess the assumptions made in reaching the amount of $1,504.42.56
[90] For the reasons I have given, my view is that a remedy of compensation in the sum of
$1,504.42 (less taxation as required by law) in favour of Mr Crozier is appropriate in the
circumstances of this case. An order will be made to that effect [PR723485].
DEPUTY PRESIDENT
Appearances:
K Presdee, Legal Officer of the AMWU, on behalf of the Applicant
R Farrar, Solicitor of Moray & Agnew, on behalf of the Respondent
Hearing details:
2020.
Newcastle (by videoconference):
25 September.
Printed by authority of the Commonwealth Government Printer
PR723484
56 Smith v Moore Paragon Australia Ltd (2004) 130 IR 446 at [32]
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