Australian Municipal Administrative Clerical Service Union v Greater Dandenong City Council

REASONS FOR JUDGMENT (revised from transcript) HIS HONOUR: 1 The substantial matter debated before the Court today was whether there should be a stay of the final orders made earlier today, pending the determination of the unsuccessful respondent's appeal. It was properly conceded by the applicants in the principal proceedings that the respondent's appeal is bona fide arguable. Submissions for the respondent 2 The case put by the respondent is of two kinds. It is said that the Council is faced in substance with two choices. The first is to reinstate the employees concerned but, in order to adhere to the Council's present policy that home care services in the council area should be outsourced, to exercise forthwith its rights lawfully to retrench the employees concerned. It is pointed out that this could not happen immediately because of requirements to consult with the first applicant. Even if the approximate cost of doing this of about $800,000, as contended for in the evidence, is not supportable, there would be a substantial cost which it is reasonable to estimate is in the hundreds of thousands of dollars. This would be by way of bringing retrenchment pay-out entitlements of all kinds up to what they would now be, having regard to the deemed continuity of employment that I have ordered should apply, and to wage inflation since the termination of the group members' services. 3 It is pointed out that such a course of action would be disturbing, without ultimate benefit, for the employees and for the clients of the home care services, whether provided by the Council or by their present supplier, Glad Pty Limited trading as Silver Circle. It is, however, properly conceded on behalf of the Council that, if this choice were pursued and the Council won on appeal, the Council could get back from the employees concerned the excess amounts of the updated retrenchment benefits over the sums previously paid to them. 4 The second choice of the Council would be to spend significant amounts of money, time, and effort in not just reinstating the employees but also, the organisation of the home care service itself within the Council. If this were done, there would be the expenditure of time and effort referred to. The Council would be, at best, in an uncertain legal position as against Silver Circle and potentially might have to pay substantial damages, albeit perhaps less than the amount allowed for in the calculations put before the Court. There would also be the necessity for another change of arrangements in relation to the people in need of home care services. Additionally, there would be no way of getting back from the employees the money that would have been expended if the Council should succeed with its appeal. 5 It is acknowledged that the employees have been kept out of the fruits of their victory for a considerable time but there is no evidence that any of them is suffering hardship on that account and it is claimed by counsel for the applicants that only a small number have suffered any significant period of unemployment. The likelihood, in these circumstances, is that if the Council pursued the course of re-engaging the employees in a functioning home care service operated directly by it, then even if the Council won the appeal it would opt not to waste the money, time, and effort, that would have been thereby expended and would act no further to disturb the clients of the service by doing what it would be entitled to, as a result of its anticipated appellate victory.

7 In Norman v Besser Industries (NT) Pty Ltd (1996) 73 IR 355, in the Industrial Relations Court of Australia, the Full Court, comprised of Moore, Marshall JJ and myself, followed the approach of the Federal Court in Powerflex Services. Conclusions 8 It seems to me that the respondent should not have a stay beyond what is necessary to implement, in an orderly way, the intended reinstatement orders of the Court. Despite claims that three months would be necessary, I do not accept this, and I think that a capably managed public authority of the size of this Council, anxious to abide the orders of the Court, could well implement the orders in an orderly fashion within 28 days, hence the orders that I have made. 9 I do not accept that the only choices facing the Council are the two which have been outlined. Even allowing that the applicants are presently holding a first instance victory, they are capably legally advised and I cannot imagine that their forceful legal advice would not at least be that all litigation has its vagaries and that compromise and flexibility in a difficult situation which has arisen would be wise. On the material before me, it is by no means clear that the Council has anything at all to fear from possible legal action by the Silver Circle interests. Having regard to the location of that company in the industry and to the fact that the Court is aware that it has chosen not to seek to exhaust appellate legal processes in relation to related litigation, it seems to me likely that the prospects of flexibility and compromise on the part of Silver Circle are not slender either. There is no reason that the Council could not seek some modification of the strict orders, by consent, from the applicants and achieve a three way settlement including Silver Circle. 10 The Council has certainly put its best foot forward with its evidence in relation to the stay but, frankly, a good deal of it appears exaggerated. Through some misunderstanding, the apparent author of what looks like exaggerated material was not present to be cross-examined upon it. Nobody is to blame for that but the fact is that, on its face, much of the material does not appear to make sense. In particular the approach to the costs analysis by counsel for the applicants seems to me to have much to commend it.

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Judgment (6 paragraphs)

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Cases Cited (4)