Construction, Forestry, Mining and Energy Union v Port Kembla Coal Terminal Ltd

The alleged breaches of the Agreement 5 Unless it is necessary to differentiate between the two respondents or between the four applicants, I refer to the applicants as "the Union" and the respondents as "PKCT". 6 I commence with a broad summary of the decision. 7 In my view PKCT breached its obligation to consult pursuant to cl. 7 of the Agreement in relation to the decisions to abolish the positions of Mr Giddings, Mr Rosewarn and Ms Arber and to terminate their employment. In summary, I say this because: (a) the proposal to abolish positions and terminate employment involved a major workplace change which, if implemented, was likely to have a detrimental or significant effect on employees. The approach PKCT took to its obligations under the Agreement meant that the proposal had that effect on conditions of employment well beyond the three employees immediately affected; and (b) PKCT's obligation to consult arose when it was considering introducing a major change and was not restricted to circumstances where it had decided to make such a change. Nor was its obligation limited to consultation about the implementation of a decision finally made. 8 Contrary to the Agreement PKCT: (a) did not consult when it was considering the proposed abolition of positions; (b) did not begin consulting with the Union until its view regarding the abolition of positions and redundancies was well entrenched. The consultation it provided was too late and the Union was not given a meaningful opportunity to affect the proposal; (c) did not consult until four months after it made the relevant decisions; (d) merely gave the appearance that it was engaging in consultation when, in fact, it did not genuinely consult; (e) did not provide relevant information to the Union in a timely way so as to allow proper consultation to occur; and (f) did not allow sufficient time for proper consultation to occur. 9 In my view PKCT breached its obligation under cl. 13.5 of the Agreement to: (a) make use of redeployment and voluntary redundancy prior to implementing "forced redundancies" (which is the term used in the Agreement for compulsory redundancies) as required under cl. 13.5.1; and (b) investigate all avenues to avoid the forced redundancies of the affected employees including by the reduction of contractors, as required under cl 13.5.3. In summary, I say this because PKCT did not give proper consideration to redeploying Mr Giddings and Mr Rosewarn into any suitable vacancy which might have arisen through offers of voluntary redundancy or any suitable role which might have arisen by PKCT reducing its use of contractors. 10 PKCT refused to seek expressions of interest in voluntary redundancy in relation to Mr Giddings' and Mr Rosewarn's positions, and as a result they were denied the possibility of redeployment within PKCT. PKCT sought expressions of interest in voluntary redundancy in relation to Ms Arber's position from her and the other two Administration Assistants. PKCT refused to consider reducing contractors, unless the contractors were engaged on a full time and permanent basis (when none were so engaged). That approach to the construction of the Agreement meant that no contractors fell to be considered by PKCT in its investigation of reducing contractors. 11 Because PKCT breached cll 7 and 13.5 of the Agreement it contravened s 50 of the Act. 12 The effect of PKCT's refusal to offer voluntary redundancies in relation to Mr Giddings' and Mr Rosewarn's positions and to restrict the consideration of reducing contractors was that there was no real prospect that they could be redeployed into other work and it was inevitable that their employment would be terminated (if their positions were abolished as proposed). 13 I do not consider PKCT breached Appendix 1, cl. 4(k) of the Agreement. In my view that provision is directed to the grading of different classifications under the Agreement rather than to redundancy, and it does not require PKCT to obtain the Union's consent before making an employee in an Appointed position redundant.

The claim of adverse action for a prohibited reason 14 The Union alleged that PKCT, with Mr Green's knowing involvement, terminated Mr Giddings' employment because of his Union role and/or his industrial activities at the terminal. The thrust of the Union's case was that, as the Lodge President and as employee representative under the Agreement, Mr Giddings had played a lead role in a number of industrial disputes, and particularly a large dispute in 2012 which led to three weeks of stoppages. The Union said that Mr Giddings was a particularly effective Union official and invited the Court to infer that Mr Green developed an adverse view of Mr Giddings as a result of his Union roles and/or industrial activities and that he terminated Mr Giddings' employment for that reason. 15 It is uncontentious that Mr Green made the decision to abolish Mr Giddings' position and terminate his employment. His evidence, corroborated by two senior managers, was that in March 2014 he requested a detailed review of PKCT's operations be undertaken because of deteriorating conditions in the coal industry. As a result of that review, on 1 August 2014 three senior managers recommended to Mr Green that Mr Giddings', Mr Rosewarn's and either one or two Administration Assistant positions be abolished. Mr Green said that he reflected on the recommendations of his senior managers over the months after the 1 August meeting, but did not decide to advance the proposal that Mr Giddings' position (and the other two positions) be abolished until October. On his account he then embarked on a genuine process of consultation with the Union commencing on 2 December 2014 and did not decide to abolish Mr Giddings' position until after the consultation process was complete on 10 December. 16 Mr Green consistently maintained that no part of the substantial and operative reasons for terminating Mr Giddings' employment included his Union role and/or his industrial activities. However, I found Mr Green's evidence, and that of the senior managers, quite unreliable. They each failed to disclose important documents and parts of the decision-making process in their evidence in chief, and their evidence was implausible in light of the contemporaneous documents, other evidence which I prefer, and the surrounding circumstances. I give their evidence little or no weight. 17 The unreliability of their evidence meant that PKCT failed to discharge its onus under s 361 of the Act to establish that the substantial and operative reasons for its termination of Mr Giddings' employment did not include his Union role and/or his industrial activities. I found that PKCT took adverse action against Mr Giddings for a prohibited reason in contravention of ss 340 and 346 of the Act. 18 In relation to the claim of accessorial liability against Mr Green pursuant to s 550 of the Act, in my view the evidence shows that Mr Green's substantial and operative reasons for his decision to terminate Mr Giddings' employment included his Union role and/or industrial activities. He was central in PKCT's contravention and knowingly concerned in and a party to it.

Relief 19 By agreement, the issue of relief was deferred except in relation to whether Mr Giddings, Mr Rosewarn and Ms Arber should be reinstated to their employment. 20 In my view Mr Giddings and Mr Rosewarn should be immediately reinstated to employment with PKCT to the pay and other terms and conditions of their former positions of Long Term Planner and Facilities Maintenance Engineer. I accept that there may be some difficult issues associated with their reinstatement as their positions have been abolished. While I am satisfied that reinstatement is appropriate I will hear the parties about any issues that arise. 21 For reasons I explain I am not satisfied on the evidence that reinstatement is appropriate in Ms Arber's case.

The facts 22 Many of the facts that I set out below are uncontroversial, but where they are contentious I usually set out my view of the evidence in the course of recounting them.

The Union's witnesses 23 The Union relied on the evidence of Mr Giddings, Mr Rosewarn, Ms Arber, Mr Robert Timbs, Vice President of the South Western District branch of the Union, Mr Murray Dakers, Lodge Vice President, and Lorraine Usher, the National General Vice President of the Union. Ms Usher's evidence related to the Union's structure and rules and she was not required for cross-examination. The other witnesses were cross examined but PKCT made little attack on their credibility. I was left with no cause to doubt the reliability of their evidence. 24 While I accept their evidence it is worth noting that it is not central to the decision. My decision on the breaches of cll. 7 and 13.5 primarily turn on my construction of the Agreement and my rejection of PKCT's evidence including in relation to important parts of the decision-making process, when Mr Green made the relevant decisions, and whether PKCT genuinely consulted or investigated all avenues to redeploy the affected employees. The evidence as to what occurred in the consultation meetings in December 2014 is largely uncontentious. 25 My decision on the adverse action claim against PKCT primarily turns on the unreliability of the evidence of Mr Green, Mr Stewardson and Mr Gorman in relation to the decision to terminate Mr Giddings' employment, which meant PKCT did not discharge its onus. My decision on the claim of accessorial liability against Mr Green again largely turns on my view of the unreliability of their evidence, and inferences I draw from the evidence regarding the adverse view Mr Green is likely to have held of Mr Giddings as a result of his Union role and his industrial activities. 26 It is generally unnecessary to traverse the evidence of the Union's witnesses in detail.

PKCT's witnesses 27 Four members of PKCT's management team gave evidence, the General Manager, Mr Green, the Operations Manager, John Gorman, the Engineering Manager, Roger Stewardson and the Business Services Manager, Flavio Tonini. 28 Mr Gorman, Mr Stewardson and another senior manager, the Human Resources Manager Ms Briony Ragen, made recommendations to Mr Green, and Mr Green made the decision to abolish the positions and terminate the employment of Mr Giddings, Mr Rosewarn and Ms Arber. Mr Tonini's evidence was largely confined to Ms Arber's case and it is not material to my decision in relation to Mr Giddings and Mr Rosewarn. While I concluded that Mr Stewardson's, Mr Gorman's and Mr Green's evidence was unreliable, I am satisfied as to the reliability of Mr Tonini's evidence.

Port Kembla coal terminal 29 Port Kembla coal terminal is a large bulk handling facility located in Wollongong, New South Wales that handles coking and steaming coal, coke, iron ore, and a range of other bulk commodities. It operates 24 hours per day, 7 days per week and has an annual throughput capacity of approximately 18 million tonnes ("mt") of materials per annum. 30 PKCT is owned by a consortium of six equal shareholders who are all coal producers on the Southern and Western coalfields and who collectively lease the terminal from NSW Ports. Illawara Coal (a subsidiary of one of the shareholders, BHP Billiton) currently holds a management agreement with PKCT. Some of PKCT's management team, including Mr Green, Mr Gorman, Mr Stewardson, and Mr Tonini are employees of Illawara Coal and they manage the terminal on behalf of the shareholders. 31 As at February 2015 PKCT had approximately 98 full time equivalent employees, comprising four shift teams who worked on a rotating roster, as well as operations, engineering and management teams who typically undertook day work from Monday to Friday ("Daywork"). Employees are required to work flexibly across the terminal and undertake various tasks. This can require operational employees to operate different machinery and work in different areas of the site from shift to shift or during a shift. 32 From 11 April 2012 the terms and conditions of employment of PKCT's employees at the terminal have been governed by the Agreement. Prior to that they were governed by an earlier iteration of the Agreement.

The Union 33 The Union is an organisation of employees registered under the Act and the Mining and Energy Division is made up of Union members who are employed in the mining, energy and associated industries. The rules of the Mining and Energy Division provide for the establishment of "lodges" at mines and workplaces by grouping its members at particular sites. The Port Kembla Coal Terminal Lodge ("the Lodge") covers the Union's members at the coal terminal, and it has a Lodge executive which includes the office of Lodge President. 34 Almost all of PKCT's employees are members of the Union.

Mr Giddings 35 Mr Giddings was employed in various roles at the terminal from 1980, starting as a Fitter and Turner. He successfully undertook a great deal of further education and became highly qualified. Over the years he enjoyed promotions into various senior positions with PKCT and was employed in the position of Long Term Planner from May 2013 until that position was abolished and his employment was terminated on 11 December 2014. The Long Term Planner role was a senior position created as a result of a restructure in around 2013 which reorganised the manner in which PKCT planned and executed its maintenance work. 36 At all material times he was a member of the Union. From April 2000 he was Lodge President, the most senior Union office at the terminal. In that capacity and as employee representative under the Agreement Mr Giddings played a lead role in the Union's industrial activities, including in a large strike in early 2012.

Mr Rosewarn 37 Mr Rosewarn was employed in various roles at the terminal from 1987, starting as a Licenced Plumber and Gasfitter. He too successfully undertook a great deal of further education and became highly qualified. He was particularly successful in his further studies and for a period he was engaged as lecturer in Operational Facilities Management at the University of Sydney. Over the years he also enjoyed promotions into various senior positions with PKCT and he was employed in the position of Facilities Maintenance Engineer when his employment was terminated on 11 December 2014. At all material times he was a member of the Union, but he held no Union office.

Ms Arber 38 Ms Arber was employed as an Administration Assistant from 13 September 2010 until her employment was terminated on 11 December 2014. Her role involved performing general administrative tasks, accounts payable and managing the accruals journal for the end of month accounts. At all material times she was a member of the Union, but she held no Union office.

The Upgrade Project 39 In May 2011, having regard to a projected significant increase in demand over the next decade, PKCT announced that it would upgrade the infrastructure and facilities at the terminal ("the Upgrade Project"). This was to be implemented through two stages: (a) Stage 1, an intermediate capacity target increase from 17.5 mt to 22.5 mt per annum, at an estimated cost in the vicinity of $250 million; and (b) Stage 2, a more extensive scope of work intended to create an ultimate capacity of about 28.5 mt per annum at an estimated cost in the vicinity of $500 million. Over time the Upgrade Project was expected to create many jobs at the terminal, both for employees of PKCT and for contractors it engaged at the terminal.

The deteriorating market conditions in the coal industry 40 Unfortunately, conditions in the Australian coal industry began to deteriorate because of a range of factors, including a decline in the price of coal by about 50% from 2011 to 2014. As a result of the poor market conditions by 2014 many Australian coal operations were operating at a loss. This led to a significant decline in employment in the NSW mining supply chain, a decline in the number of employees in NSW coal exploration and mining companies, and there were redundancies in Wollongong Coal's Wongawilli mine, Glencore's Tahmoor mine and at Illawarra Coal in 2014. 41 Between 2011 and 2014: (a) the throughput of coal at PKCT decreased from 14 mt to approximately 12.4 mt; (b) loading charges increased from $3.80 to $4.75 per tonne; and (c) PKCT experienced a drop in revenue of $5.25 million. In the same time period the number of permanent employees directly employed by PKCT increased from 93 to 106.

Cancellation of the Upgrade Project / Announcement of the R&C Project 42 As a result of the significant deterioration in market conditions, in February 2013 the PKCT Board ("the Board") decided not to proceed with the Upgrade Project. 43 However, earlier reports on the condition of plant and equipment at the terminal had highlighted the extent of the backlog of maintenance and restoration work that was required. The scale and complexity of this work was beyond routine repair and maintenance activities and PKCT decided to tackle the necessary work as a program to be completed by a dedicated project team in parallel with terminal operations and regular repairs and maintenance. In February 2013 the Board approved a Restoration and Compliance Program ("R&C Project") to be undertaken over the next five years at an estimated cost of $218-$294 million.

Contractors engaged at the terminal 44 Mr Stewardson said, and I accept, that at all material times there were about 50 contractors engaged through the R&C Project. There were also between five and 15 additional contractors working at the site.

Announcement of the Operational Review 45 In March 2014, Mr Green announced an operational review of PKCT's business ("the Operational Review") and in April he assigned Mr Gorman to concentrate on the review. Its essential purpose was to identify ways in which PKCT could achieve efficiencies and savings in order to reduce costs, including by determining whether there were any activities that could be done differently and whether there were any positions within PKCT that were no longer needed. 46 To my mind, there is no real question that in conducting the Operational Review, and in considering a reduction in manning levels through the abolition of positions, PKCT was engaged in a bona fide attempt to reduce its costs. 47 Prior to Mr Gorman's appointment, work had already been undertaken on initiatives to achieve savings at PKCT. For example, PKCT's Business Improvement Specialist, Krishna Panyam, had earlier developed a restructuring proposal which involved the abolition of eight positions. Between mid-April and early July 2014, Mr Gorman reviewed these initiatives and informed Mr Green which initiatives should be progressed as part of the review.

Phase 1 of the Operational Review 48 The initiatives in Phase 1 of the Operational Review included taking up an existing proposal to reduce shift team members (which involved the transfer of two employees from each shift team back to Daywork groups), a proposed freeze on employees' wage increases under the Agreement, and a proposed 12 month suspension of the annual increases to employees' grades under the Agreement. Mr Green accepted Mr Gorman's recommendations regarding those matters. The shift team members were reduced by two. In July 2014 Mr Green sought the employees' agreement to a wage freeze and a 12 month suspension of regrading of positions.

Phase 2 of the Operational Review 49 Phase 2 of the Operational Review involved a review of Daywork support and functional roles in order to identify cost reductions and efficiencies, including considering whether there were any positions which were surplus or could be re-distributed amongst the current workforce. In this part of the review Mr Gorman spoke to relevant managers, including Mr Stewardson, Mr Tonini and Ms Ragen, in an effort to determine whether reducing the number of positions in their teams was feasible.

PKCT's historical approach to manning level reductions 50 Mr Giddings said, and I accept, that at various points in his 34 years at the terminal the employer had required a reduction in manning levels because of the operational needs of the business. He said that until the present events any such reductions were achieved by seeking expressions of interest in voluntary redundancy across the terminal. Those who expressed interest were generally accepted for redundancy, and if the duties of that position still needed to be performed then another person would be swapped into the vacant position. Mr Tonini accepted that voluntary redundancies and "job swaps" were previously used at the terminal, as did Mr Green. Before the termination of Mr Giddings', Mr Rosewarn's and Ms Arber's employment, there had never been a forced redundancy at the terminal in the past 34 years.

The development of the proposal to abolish positions as part of Phase 2 51 Mr Gorman testified that his consideration of the cost savings which had the potential to result in the abolition of positions started in May. While other evidence suggests that Phase 2 of the review had commenced by early April nothing turns on that. 52 At an early date Mr Stewardson identified some opportunities to consolidate roles in the Engineering team and on 16 April 2014 he emailed Ms Ragen some preliminary ideas in that regard. He attached two documents he had prepared titled "PKCT Organisational Chart 12.5M" and "Organisational Redesign Stage 2". In these documents he proposed the abolition of seven engineering positions, including the Long Term Planner and Facilities Maintenance Engineer positions occupied by Mr Giddings and Mr Rosewarn respectively. He described this proposal as a "work in progress" and probably a "stretch target", but said that it could be passed on to Mr Gorman. 53 On 2 May Mr Gorman met with Mr Stewardson and Ms Ragen to discuss, amongst other things, the possibility of abolishing some positions to reduce costs. During this meeting he said that the Engineering and Administration teams would be reviewed in order to determine whether there were any roles that could be consolidated or which were no longer required. Following this meeting, Mr Stewardson said that he thought that it might be possible for the Engineering team to work without the Technical Officers (three positions), Project Officers (two positions), and the Facilities Maintenance Engineer and Long Term Planner positions. 54 On 23 May Mr Gorman again met with Ms Ragen and Ms Stewardson and they considered a detailed PowerPoint presentation prepared by Ms Ragen titled "Operational Review - May 2014". In it she proposed the abolition of a larger number of positions including the Long Term Planner, Facilities Maintenance Engineer and one Administration Assistant position. Importantly, the presentation tends to show that Ms Ragen thought that affected employees could be redeployed into work undertaken by contractors engaged by PKCT, including that Mr Giddings could be redeployed to the "MTEC position". 55 On 3 June Mr Gorman and Ms Ragen met with Mr Tonini to discuss, amongst other things, whether cost savings could be found in the Finance/Administration team. In this meeting Mr Tonini said that there was scope to reduce positions in his team. 56 On the same day Mr Gorman prepared a document titled "PKCT Operational Review summary paper" in which he outlined his preliminary thoughts on cost savings associated with PKCT's labour costs and identified the possibility of abolishing seven positions. Importantly, Mr Gorman approached the proposed abolition of positions on the basis that the Agreement required that offers of voluntary redundancy be made to other employees before forced redundancies were implemented. Under a heading "Process/EA Compliance" the summary paper stated: • Can we focus on a subset of the PKCT Employee group? • Who must VR's be offered to? Can it just be a subset of the PKCT Employee group? • On what grounds can we rejected [sic] a VR request? Cost savings? Retirement likelihood? The summary paper tends to show that Mr Gorman understood the Agreement to require PKCT to offer voluntary redundancies before implementing forced redundancies, but that he considered that requirement to be inefficient and costly. 57 In May or June 2014 Mr Gorman prepared a document titled "Review of the obligations regarding workforce reductions". In it he summarised PKCT's obligations under the Agreement in the context of the proposed abolition of positions and commented on how PKCT could adhere to its obligations. It tends to show that Mr Gorman understood the Agreement to require PKCT to offer redeployment and voluntary redundancies before implementing forced redundancies and to investigate all avenues to avoid forced redundancies, including by reducing contractors. Importantly, it tends to show that he thought that there were avenues potentially available to avoid the forced redundancies of Mr Giddings and Mr Rosewarn. 58 In June Mr Gorman prepared a detailed spreadsheet titled "Scenario Planner". In it he set out the positions proposed to be abolished under various scenarios and identified the affected employees by name. The spreadsheet set out the age, length of service, cost of redundancy, and job swap and redeployment options in respect of 15 positions, including those of Mr Giddings, Mr Rosewarn and two Administration Assistants. It tends to show that he understood the Agreement to require PKCT to offer voluntary redundancies and to redeploy affected employees into contractors' work before forced redundancies could be implemented. The Scenario Planner tends to show that Mr Gorman thought that Mr Giddings could potentially be redeployed into a number of positions within PKCT (if they became vacant through offers of voluntary redundancy) or into a number of contractor roles, and that Mr Rosewarn could potentially be redeployed into the position of Services Planner within PKCT (if that became vacant through voluntary redundancy) or into the Project Supervisor contractor role. It tends to show that he only thought that an affected Administration Assistant could potentially be redeployed into a contractor role of Secretary/Personal Assistant within the "Project / Non-EA" area. 59 On 30 June, Mr Gorman prepared an organisational chart which proposed the abolition of five engineering positions (including Mr Giddings' and Mr Rosewarn's positions) and three other positions (including two Administration Assistant positions). He provided this chart to Mr Green before he sought the employees' agreement to a wage freeze at the Lodge Annual General Meeting ("AGM") on 4 July. Mr Green did not inform employees or the Union about the proposal at the AGM. 60 Mr Stewardson said that between June and October 2014 he prepared a PowerPoint presentation titled "Operations Review: Indicative Engineering Team Organisation Charts". The presentation included various organisational charts and the chart headed "Current" proposed the abolition of five positions in the Engineering team including Mr Giddings and Mr Rosewarn's positions. In the final chart he prepared, headed "Nirvana", Mr Giddings no longer had a job in the Engineering team. 61 Mr Gorman said (and I accept) that by late June 2014 he had arrived at the view that, outside of the Administration Assistants, PKCT should not offer voluntary redundancies to affected employees. He advised Mr Green that offering voluntary redundancies in relation to positions abolished in the Engineering team would reduce the cost savings that PKCT could achieve. Mr Green accepted that he was told this but said that this discussion occurred around October 2014. I prefer Mr Gorman's evidence in this regard. 62 The evidence is that, on 10 July, Mr Tonini told Mr Gorman that it was impractical to reduce the number of Administrative Assistants in his team by more than one position. It is unclear whether Mr Gorman accepted this advice at the time, but he ultimately did so. 63 Mr Gorman met with Mr Stewardson to discuss the potential for cost savings in the Engineering team on several occasions between May and July 2014. The evidence indicates that Mr Stewardson, Mr Gorman and Ms Ragen reached essentially the same views about the proposal to abolish positions and about PKCT's obligations in that regard. They made joint recommendations to Mr Green at a meeting on 1 August. 64 The 1 August meeting was not, however, the first that Mr Green heard of the proposal. Mr Gorman said that through April, May, June and July 2014 he kept Mr Green informed about how the Operational Review was progressing, in part through regular fortnightly meetings. Mr Green said that by 7 July he understood that Mr Gorman proposed that, amongst others, Mr Giddings' position of Long Term Planner and Mr Rosewarn's position of Facilities Maintenance Engineer be abolished. 65 In around mid-July, in preparation for a meeting with Mr Green, Mr Stewardson reviewed the various positions within the Engineering team and prepared a summary of his views as to whether each position was necessary for PKCT to operate effectively. On 17 July he set up a meeting between them on 21 July and emailed the summary to Mr Green and Ms Ragen under the subject heading Phase 2 Background to Tomorrow's Discussion ("the Phase 2 Background Summary"). It proposed the abolition of positions, again including the Long Term Planner and Facilities Maintenance Engineer positions. The summary included a passage in which Mr Stewardson said that the necessary organisational changes at PKCT could not be achieved in a timely way through consultation, and that PKCT should "just do it". 66 Mr Gorman said that at some point in July he told Mr Green that the proposal to abolish positions could be announced in August. I infer from this and other evidence that, by then, the proposal was essentially complete.

The Organisational and Operations Review Report 67 Shortly after 2 July Mr Gorman produced a detailed report titled "PKCT FY15 Organisational and Operations Review". He provided the first draft of the report ("the first draft OOR Report") (Exhibit A5 Tab 1) to Mr Green, Mr Stewardson and Ms Ragen by way of a shared link on PKCT's computer network. 68 Although the draft report did not identify the positions to be made redundant it focused on the management and implementation of the planned dismissal of some employees for reasons of redundancy. It is significant that the report was prepared on the basis that PKCT was required to redeploy affected employees through offers of voluntary redundancies and by reducing contractors, so as to avoid forced redundancies. 69 Mr Gorman and Ms Ragen then made changes to the first draft OOR Report. By the conclusion of the trial there were four draft OOR Reports in evidence. 70 I will call the next draft report in sequence the second draft OOR Report (Exhibit A5 Tab 2). It proposed that Mr Giddings', Mr Rosewarn's and two Administration Assistants' positions be abolished. On my view of the evidence it is likely that the second draft OOR Report was produced in July 2014. I say this for a number of reasons: (a) the second draft report represents a further development of the first draft and follows sequentially from it; (b) it stated that the abolition of positions was to be announced in August 2014 which indicates that it was created before that date; (c) that date of creation is consistent with Mr Gorman's evidence that he advised Mr Green in late June 2014 that PKCT should not offer voluntary redundancies in relation to any affected positions outside of those in the Finance/Administration team (as the report is prepared on that basis); and (d) it precedes the third draft OOR Report which, again, follows sequentially. On my view of the evidence it is likely that Mr Gorman or Ms Ragen provided the second draft OOR Report to Mr Stewardson and Mr Green in July, by way of a shared link. 71 The second draft OOR Report reveals that, in July 2014, there was a significant change in PKCT's approach to its obligations to make use of redeployment and voluntary redundancy before implementing forced redundancies and to investigate all avenues to avoid forced redundancies including by the reduction of contractors. 72 The first draft OOR Report, and the earlier proposals to which I have referred, tend to show that Mr Gorman, Mr Stewardson and Ms Ragen understood the Agreement to require that where employees faced forced redundancy PKCT was obliged to redeploy them into suitable vacancies that arose through offers of voluntary redundancy or into suitable contractors' work. The contemporaneous documents also tend to show that they recognised that there were potentially available avenues for the redeployment of Mr Giddings and Mr Rosewarn, while the second draft OOR Report stated that there were no redeployment options for them within PKCT. 73 The second draft OOR Report includes a section headed "Bona Fide Redundancy Checklist" which indicated that Mr Giddings and Mr Rosewarn were not to be redeployed: (a) into any suitable vacancy created through offers of voluntary redundancy because they each occupied an "appointed position" which is described as "stand-alone"; or (b) into suitable contractors' work (by reducing contractors) because the contractors were not engaged on a full time and permanent basis; or 74 From this time on the proposal to abolish positions proceeded on the basis that it would occur without voluntary redundancies being offered in relation to Mr Giddings' and Mr Rosewarn's positions and without reducing contractors. Mr Gorman said, and I accept, that the change in PKCT's approach to its obligation to investigate reducing contractors followed receipt of legal advice authorised by Mr Green in June 2014. I infer that Mr Green, Mr Gorman and Ms Ragen were informed of that advice in around July 2014. 75 Because there were no vacancies in suitable positions within PKCT, if Mr Giddings' and Mr Rosewarn's positions were abolished, the only realistic avenue to avoid their forced redundancies was for PKCT to redeploy them, either into suitable vacancies that arose through offers of voluntary redundancy or into contractors' work. The effect of PKCT's changed approach to its obligations under the Agreement was that the die was cast if Mr Giddings' and Mr Rosewarn's positions were abolished. 76 Ms Ragen and Mr Gorman then created the third draft OOR Report (Exhibit A5 Tab 3). I infer that it was provided to Mr Stewardson and Mr Green by way of a shared link at the time of its creation. In the third draft report the proposal to abolish the Long Term Planner, Facilities Maintenance Engineer and two Administration Assistants positions was mature and comprehensive, and in my view essentially complete. It indicated that offers of voluntary redundancy would not be made other than in relation to the Administration Assistant positions and that contractor positions which were not full-time and permanent would not be considered for reduction. 77 The third draft OOR Report again contained detailed redundancy checklists concerning the individual circumstances of Mr Giddings, Mr Rosewarn and each affected Administration Assistant, together with a detailed implementation plan, including a period of consultation, which culminated in dismissal of four affected employees. 78 In the third draft OOR Report the proposal to abolish positions was to be announced on 21 October followed by three weeks of consultation. The only difference between the proposal in the third draft report and the proposal announced in December was the reduction in the affected Administration Assistant positions from two down to one. This reduction was consistent with Mr Tonini's advice to Mr Gorman on 10 July (and his email to Ms Ragen on 10 October) that it was impractical to abolish more than one Administration Assistant position. 79 On about 16 October 2014 a fourth, updated, version of the OOR Report was produced ("the final draft OOR Report") (Exhibit A11).

When was the third draft OOR Report produced? 80 There is a dispute as to the date the third draft OOR Report was produced. The Union contended that it was created at about the end of July 2014, while PKCT contended that its date is uncertain but that it was likely to have been created much later. While there is some uncertainty as to the date of the third draft, I consider that it was most likely created by Mr Gorman and Ms Ragen at about the end of July. 81 I say this, first, because: (a) the contents of the first three drafts of the OOR Report in evidence shows that they are sequential. It is uncontentious that Mr Gorman produced the first draft OOR Report on 2 July 2014. The second draft OOR Report is later than the first draft, and the third draft OOR Report is later than the second draft. Mr Gorman accepted this. (b) the second draft OOR Report stated that the proposed redundancies were to be announced in August 2014 which indicates that it was created before that date. (c) in the third draft OOR Report a section titled "Managers Bona Fide Redundancy Checklist" provided for the relevant manager to enquire whether the affected employee was currently on leave or about to commence leave (which was relevant to scheduling consultation meetings with them following announcement of the proposal). It is significant that the information was provided "as at 25 July 2014". The entry for Ms Arber stated: "As at 25 July 14 [Annual Leave] planned for 18 September - 24 September" (emphasis added). The entry for Mr Rosewarn stated: "As at 25 July 14 preliminary leave booked from 22 September 14 - 17 October 14" (emphasis added), and the entry for Mr Giddings stated that he would be absent on Union business on 4 - 5 August 2014. These entries tend to show that the third draft OOR Report was produced before 25 July 2014. 82 Second, in cross-examination Mr Gorman accepted that he saw a draft OOR report in the form of the third draft sometime in July 2014. While it can be accepted that it would have been hard for him to tell which draft he was looking at, and that there was some confusion in that regard, based upon its contents he accepted that the third draft OOR Report was prepared on or before 25 July 2014. 83 Third, while not identifying the document he saw as exactly the same as the third draft report, Mr Green accepted that he saw a document similar to that draft in July. Mr Green also accepted that in his meeting with senior management on 1 August he discussed recommendations which were consistent with the contents of the third draft. 84 Fourth, while PKCT argued that the date of creation of the third draft OOR Report was uncertain, it should be kept in mind that all drafts of the report were kept on its computer system, and I infer remain so. It would have been straightforward for PKCT to adduce evidence proving when the different drafts were created, including by calling Ms Ragen as a witness. However, it did not do so. In their evidence in chief Mr Stewardson, Mr Gorman and Mr Green did not even disclose the existence of the OOR Report. 85 Fifth, PKCT sought to rely on the use of the past tense in the third draft OOR Report which stated that the development of the proposal "commenced" in August - October 2014. However, each draft of the report used the word "commenced" in this context and it could just as easily have remained unchanged between drafts. 86 PKCT also argued that the fact that the third draft OOR Report provided for the announcement of the proposal to on 21 October 2014 indicates that it was created in that month. I accept that it points in that direction but it is far from conclusive. It may be that the announcement date was set for 21 October 2014 because, as the evidence shows, Mr Rosewarn was away on annual leave from 22 September until 17 October 2014. 87 For completeness I note that, after both parties had closed their cases and without seeking leave to do so, PKCT sought to file three computer screenshots as Attachments A, B and C to its reply submissions dated 5 May 2015. Although PKCT put on no evidence as to the provenance or meaning of the screenshots it submitted that they showed the dates that the three draft report were produced. The Union objected to the admission of further evidence on the basis that it had closed its case and that doing so would deny the Union a proper opportunity to test the provenance and understand the meaning of the screenshots. I have upheld that objection and I have not admitted Attachments A, B and C into evidence.

The meeting on 1 August 2014 88 Mr Gorman said that on 24 July he met with Mr Green for their regular fortnightly review. By that date Mr Gorman had returned to the role of Operations Manager and his role conducting the Operational Review had substantially concluded. However, he said that he continued to provide back up support and operational input across Phase 2 of the review including assisting other managers in their consideration of any proposed redundancies within their teams. 89 In his affidavit Mr Gorman described the meeting on 24 July as his regular fortnightly meeting with Mr Green and he said that, together with Mr Stewardson and Ms Ragen, he then met with Mr Green on 1 August to discuss their recommendations to abolish positions. Mr Green also testified that the senior managers made their recommendations on 1 August 2014. There was some confusion in Mr Gorman's evidence about whether the senior managers made their recommendations on 24 July or on 1 August but nothing turns on that. I conclude that Mr Gorman and the other senior managers made their recommendations to Mr Green on 1 August 2014 and in my view the suggestion in Mr Gorman's evidence that he did so a week earlier, on 24 July, was just a mistake. 90 On 1 August 2014 Mr Green met with Mr Gorman, Mr Stewardson and Ms Ragen and he considered their recommendation to abolish Mr Giddings' and Mr Rosewarn's positions, along with either one or two Administration Assistant positions. I note that by that date Mr Tonini had informed Mr Gorman that it was only practicable to abolish one Administration Assistant position, and whether at that time one or two Administration Assistants were proposed to be abolished is somewhat unclear. However, little turns on the question. 91 The senior managers recommended to Mr Green that PKCT: (a) should not offer voluntary redundancies to avoid forced redundancies in relation to Mr Giddings' and Mr Rosewarn's positions. If accepted, this recommendation would have the effect that no vacancies in suitable positions could arise within PKCT into which they might have been redeployed; and (b) should only consider reducing contractors to avoid forced redundancies if the contractors were engaged on a full time and permanent basis (when, in fact, there were no such contractor roles). If accepted, this recommendation would have the effect that no vacancies in suitable contractors' work could be found into which they might have been redeployed. 92 The senior managers provided Mr Green with an organisational chart which reflected the proposed changes. Mr Green said that, at the time, he explored the business case and rationale for each proposal, the extent of the cost savings or efficiencies which they could achieve, as well as the practicality of implementing each proposal. On his evidence (essentially corroborated by Mr Gorman and Mr Stewardson) he did not accept the recommendations at that time and he said that he gave the proposal intermittent consideration over the next two and a half months until mid or late October. As I will explain, I do not accept his evidence in this regard. In my view it is likely that Mr Green followed the recommendation of his senior managers and made the decision to abolish Mr Giddings', Mr Rosewarn's and at least one Administration Assistant position at or shortly after the 1 August 2014 meeting. 93 While I accept that Mr Green may have given some further thought to the issue after 1 August, in my view nothing occurred thereafter which was anything more than fine tuning a decision already made. There were no material changes to the proposal to abolish positions from late July 2014 until the proposal was announced on 2 December. It is probable that the delay in the implementation of the decision he made on or about 1 August was a result of his attention to other business issues rather than because he was still deciding about whether to move ahead with the proposal.

The meetings between 1 August and November 2014 94 The evidence is that Mr Green met with Mr Gorman, Ms Ragen and Mr Stewardson on five occasions between 1 August and 18 November 2014 to discuss the progression of the Operational Review, and that the meetings covered matters including status updates in relation to the proposed abolition of positions, final recommendations from relevant managers, timeline planning and review of the implementation schedule. PKCT's evidence that these meetings involved "final recommendations" is implausible, at least insofar as Mr Giddings' and Mr Rosewarn's positions are concerned, and I do not accept it. There is no cogent evidence of any significant further or "final" recommendations, and there was no material change in the senior managers' recommendations from 1 August. 95 In these meetings Mr Stewardson said he reaffirmed his recommendation that the positions of Long Term Planner and Facilities Maintenance Engineer be abolished. In October, he prepared a summary document which set out the reasons underpinning his view that the Long Term Planner and Facilities Maintenance Engineer positions need not be maintained. 96 Mr Gorman gave evidence that through August and September he developed a Consultation Plan to ensure that PKCT met its consultation obligations under the Agreement. As I explain, I do not accept his evidence in that regard, as on my view of the evidence he developed the Consultation Plan in July 2014 through the draft OOR Reports. 97 Mr Gorman said that in September or October he saw a plan titled Organisational Review (Phase 2) - Communications and Engagement Plan ("Communications and Engagement Plan") prepared by Ms Ragen. The Communications and Engagement Plan stated that three to five positions (or alternatively nine positions) might be abolished. Ms Ragen did not give evidence and there is no cogent evidence as to when this document was created. Ms Ragen circulated the plan under cover of an email on 29 October and by that date it is uncontentious that Mr Green had decided that only the Long Term Planner, Facilities Maintenance Engineer and one Administration Assistant positions faced abolition. That shows that, at that time, the Communications and Engagement Plan was not current. On my view of the evidence it is likely to have been created before the third draft OOR Report, but because its date of creation is unknown it is of little assistance in relation to the development of the proposal. 98 In cross-examination Mr Green said that between July and October his senior managers recommended to him that the Long Term Planner and Facilities Maintenance Engineer positions be abolished with the duties performed within those roles being distributed amongst other positions. He also said that he was informed that the administrative Payroll, Accounts Payable and Accounts Receivable and Reception roles could be consolidated. In my view the evidence shows that those recommendations were made to him on 1 August and, as I have said, that he accepted those recommendations around that date. 99 On 10 October 2014 Mr Tonini emailed Ms Ragen and reaffirmed his July advice to Mr Gorman that only one Administration Assistant position should be abolished. 100 Mr Stewardson said that in around October he prepared an untitled summary document identifying the reasons that the Long Term Planner and Facilities Maintenance Engineer positions were no longer necessary. 101 In his affidavit Mr Green said that he did not make the decision to proceed with the proposed abolition of positions until mid-October 2014. On his account it was not until then that he informed Mr Gorman, Mr Stewardson, Ms Ragen and Ms Tonini that he endorsed the recommendations and that he decided to announce the proposal and commence consultation with the Union. In cross-examination, Mr Green altered his evidence somewhat and he said that he made that decision around 29 October or in early November. Importantly, he also testified that he: (a) did not make the decision that voluntary redundancies would not be offered in relation to Mr Giddings' and Mr Rosewarn's positions until mid-October; and (b) did not decide that PKCT's consideration of reducing contractors would be limited to full time and permanent contractor roles until 10 December. 102 Mr Green said, and I accept, that in October he intended to announce the proposal to abolish positions in mid-November but he delayed that announcement to 2 December, because a farewell dinner for five longstanding employees was scheduled for 21 November. 103 On 23 October Ms Ragen sent an email headed "Legally Privileged - Confidential - Operational Review" to Mr Green, Mr Stewardson, Mr Gorman and Mr Tonini amongst others, together with a meeting invitation for 29 October. She attached a number of documents that I infer were to be discussed at the meeting, including: (a) a Detailed Execution Timeline and Calendar setting out the timing of the process for engaging in consultation; (b) a Documentation Checklist and Action List for Impacted Employees; (c) template correspondence that was to be provided to each redundant employee; (d) a Redundancy Information Booklet dated June 2014; (e) a list of Frequently Asked Questions and proposed responses concerning employee redundancy at PKCT; (f) the Communication and Engagement Plan; (g) a briefing sheet titled PKCT Organisation Review - Impacted Employee Record of Discussions for use by a manager meeting with an affected employee; and (h) the final draft OOR Report. 104 Those documents show a highly planned process for compulsory redundancies, even including template correspondence to be given to employees who were to be made redundant. Managers who were to have initial discussions with affected employees were instructed to: Be clear that the role is no longer required - have empathy but leave no doubt. 105 In his affidavit Mr Green described the 29 October meeting as being "to discuss various amendments to and refinements to the initial proposals". I do not accept his evidence in that regard. The documents tend to show that the meeting was about execution of pending redundancies rather than refinements to the proposal. 106 It is significant that, apart from some date changes, the final draft OOR Report was no different in substance from the third draft OOR Report prepared before the 1 August meeting.

The consultation process - 2 December to 10 December 2014 107 On 28 November 2014 Mr Green, Mr Stewardson and Mr Tonini, amongst others, met to finalise the documents relevant to PKCT's consultation with the Union. The proposal to abolish positions was to be announced on 2 December followed by 10 days of consultation. 108 PKCT announced the proposal and commenced the consultation process with military precision. On 1 December 2014 Mr Green telephoned Mr Timbs to advise that he would be addressing a meeting of employees the following morning. Notwithstanding that the announcement was to be made the following day, Mr Green refused to inform Mr Timbs about the exact purpose of the meeting as he said that doing so would "compromise the necessity of consultation". Mr Green also emailed Mr Giddings and other members of the Lodge executive to invite them to the meeting but, again, he gave them no inkling of what he intended to say. 109 At 8:04 am on 2 December Mr Green emailed the management and team coordinators to inform them that all employees were required to attend an information meeting at 9:00 am. 110 At the meeting Mr Green informed the assembled employees that the outcomes of Phase 2 of the operational review would soon be implemented. He said that this stage might involve redundancies and that potentially affected employees would be spoken to that day. He was careful to say, however, that PKCT was yet to make a final decision on any redundancies. 111 Immediately after that meeting, at about 9:30 am Mr Green held the first consultation meeting. In that meeting he and other PKCT managers met with Union representatives including Mr Giddings, Mr Timbs and Mr Dakers. 112 In this meeting, Mr Green gave a PowerPoint presentation titled "PKCT Operational Review @ 2 December 2014" which referred to the proposed abolition of positions and reiterated that a final decision had yet to be made. He was questioned on the basis and rationale for the abolition of positions and how any redundancies were proposed to occur but he said he was not prepared to provide further information until the potentially affected employees had been informed that their positions were under threat. As a result, at the conclusion of that meeting the Union still did not know which positions were affected, whether voluntary redundancies would be offered before forced redundancies were implemented or whether contractors would be reduced so that their work could be taken up by the affected employees. 113 In separate meetings on the morning of 2 December, Mr Giddings and Mr Rosewarn were informed that their positions were proposed to be abolished. The same morning the three Administration Assistants, Ms Karen Maxwell, Ms Jennifer Arber and Ms Nicky Ostach, were informed that it was proposed to abolish one Administration Assistant position and that if none of them elected to take a voluntary redundancy PKCT would make one of them compulsorily redundant. At the end of those meetings the affected employees were handed a letter dated 2 December titled "Business changes impacting your employment" which notified them of the outcome of the Operational Review. Importantly, the letter noted that there were no vacant positions within PKCT into which they might potentially be redeployed. 114 On the afternoon of 2 December, a second consultation meeting took place between, amongst others, Mr Green, Mr Stewardson and Mr Tonini for PKCT and Mr Giddings, Mr Timbs and Mr Dakers for the Union. What occurred in this and later consultation meetings is largely uncontentious and it is unnecessary to set it out in great detail. 115 Amongst other things, in the meeting Mr Timbs explained that the Union considered that cl 13.5.1 and 13.5.3 of the Agreement applied and that PKCT was required to offer voluntary redundancies to other employees, and to consider reducing contractors before it implemented forced redundancies. Mr Timbs argued that offering voluntary redundancies on a broad basis would mitigate the need for forced redundancies and would open up opportunities for redeployment into technical and/or operational streams. In response Mr Green said that voluntary redundancies would only be offered in relation to the Administration Assistant position and PKCT was not obliged to offer voluntary redundancies in relation to the Facilities Maintenance Engineer and Long Term Planner positions. Mr Timbs said that this meant that PKCT was not complying with clauses 7, 9 and 13 of the Agreement and that there had been lack of consultation in relation to those matters. 116 On the morning of 3 December Mr Green met with Mr Gorman, Ms Amy Linton, Mr Stewardson and Mr Tonini. Mr Gorman said that he recalled discussing the Union's view that there were some "gates" that PKCT was required go through, which I take to mean some procedures in the Agreement that had to be complied with before forced redundancies could be implemented. He said they discussed the Union's concerns about employee classification, use of contractors, and separating the Long Term Planner role from the other planning roles. He said that Mr Green requested that the senior managers consider each of the issues raised by the Union and prepare responses so that he could be in a position to inform the Union of PKCT's position. 117 At 5:24 pm that day Ms Linton emailed a document to, amongst others, Mr Gorman and Mr Stewardson in which she summarised the Union's concerns and set out a range of responses to matters anticipated to be raised by the Union ("the Response Document"). For example, in relation to redeployment into contractors' work the Response Document said: We will not redeploy people into contract roles which are for a finite duration where it does not make sense to do so having regard to the status of the contract and the skills required. [Insert link matrix to all contractor positions at PKCT and analysis of the skill set of employees to be made redundant to evidence that the positions are not suitable (including because positions are temporary)]. 118 The matrix of contractor positions referred to in the Response Document was an assessment of contractor roles that might be performed by affected employees prepared by Geraldine Uren, a contractor who worked in an administrative capacity. She did not give evidence but the matrix tends to show her view, or the view of the manager who instructed her, that: (a) Mr Giddings had suitable skills for the contractor roles of Asset Management Specialist, Contracts Manager, Project Engineer, Project Supervisor, Painting Specialist, Fitter or an R&C Project role but his skills were unsuitable for the roles of Asset Management Specialist and Painting Specialist; (b) Mr Rosewarn had suitable skills to work as a plumber or perform some R&C Project roles; and (c) Ms Arber had suitable skills to work in an administrative support role within the Human Resources team. Although the matrix identified contractors' work that Mr Giddings, Mr Rosewarn and Ms Arber had the skills to undertake, it also provided that this work was not suitable because the contractor roles identified were not full time and permanent. 119 On 4 December Mr Tonini met with the three Administration Assistants and asked whether any of them intended to accept the voluntary redundancy offer. 120 On the same day the Union wrote to PKCT requesting it to provide information about the work undertaken by contractors so that the Union could meaningfully participate in consultation about reducing contractors. It sought the following information. SCHEDULE 1. A list of all positions (both occupied and vacant) on the PKCT Upgrade Project, including the skills and qualifications required for each position. 2. A list of all vacant positions with Illawarra Coal, including the skills and qualifications required for each position. 3. Noting the comments on the letters issued to the 5 employees that some activities in the business will need to be done differently, provide details of those activities and how they will be done differently. 4. Noting the comments on the letters issued to the 5 employees that some activities in the business may not be done at all, provide details of the activities in the business that are contemplated as not being done at all. 5. Provide details of how the tasks currently performed by the 5 employees will be reallocated to other employees or otherwise not performed at all. 6. Noting clause 13.5.3 of the enterprise agreement, provide details of all work currently being performed by contractors, including details of the skills and competencies required and the nature of the work. 7. Noting clause 13.5.4 of the enterprise agreement, provide details of the steps taken by PKCT, to date, to avoid the redundancies. (Emphasis added.) 121 The Union also requested that: 1. PKCT provide a response to the Schedule by close of business Friday 5 December 2014. 2. PKCT provide a copy of Phase 2 of the Organisational Review to the 5 employees and the CFMEU by close of business Friday 5 December 2014. 3. PKCT undertake to further consult the employees and the CFMEU about these matters. 4. PKCT undertake to not implement any redundancies (forced or otherwise) until the completion of the consultation process. 5. If redundancies are required, PKCT undertakes to firstly offer voluntary redundancy to all employees within the Daywork Appointed Positions classification and accept any such volunteer for redundancy to which Mr Giddings and/or Mr Rosewarn has the same or equivalent skills. Unless Mr Giddings and/or Mr Rosewarn were to accept voluntary redundancy, each man would then be redeployed into the position formerly occupied by any such volunteer(s). 6. On completion of (5) above, PKCT undertakes to consult with the employees and the CFMEU in relation to all avenues to avoid forced redundancies in the Finance/Administration/Stores classification and the Daywork Appointed Positions classification. (Emphasis added.) 122 Following its receipt of the Union's letter of 4 December PKCT rescheduled the consultation meeting planned for 5 December so that it had time to respond. On 5 December Mr Green met with his senior managers to prepare PKCT's response. In extensive email exchanges through that day, Mr Gorman, Mr Stewardson and Ms Linton discussed the precise wording to be used in the response. Mr Gorman conceded in cross-examination that, in formulating this response, he was simply seeking to justify the company's position the best way that he could, rather than genuinely considering the Union's alternative view. 123 By a letter on 8 December PKCT provided a response, which was little more than a reiteration of its position. PKCT refused to provide the information the Union sought regarding contractors and its letter stated: 1. I refer to the explanation above, and reiterate that it is not necessary for PKCT to provide a list of all positions on the PKCT Restoration & Compliance (Upgrade) Project. … 6. There are a number of contractors engaged by PKCT who perform sporadic or part-time functions. There are no contractors engaged by PKCT who perform full-time functions that could be considered full-time and permanent. The nature of this work is therefore not relevant to the employment of full-time employees of PKCT. 7. I refer to my comments set out above, and the presentation that was provided to the CFMEU on 2 December 2014. I further refer to the information provided above regarding: a. Voluntary redundancies being offered to the Administration Assistants; b. Consideration of redeployment at PKCT and Illawarra Coal; and c. Consideration of suitable contract positions at PKCT. 124 In relation to the Union's request for undertakings Mr Green said: 1. I do not believe the timeframe of a response by close of business Friday 5 December 2014 was reasonable, but have undertaken to respond as soon as practicable; 2. PKCT has provided a copy of the slide-pack presented to the CFMEU on 2 December 2014 to the potentially affected employees; 3. PKCT will continue to consult with the potentially affected employees and the CFMEU until a final decision is made; 4. PKCT undertakes to continue to discuss each individual's circumstances with that employee until a final decision is made; 5. PKCT does not agree for the reasons set out in this letter; 6. PKCT will consider all avenues raised in consultation with the employees and the CFMEU in order to avoid forced redundancies having regard to business needs. 125 PKCT's letter included an explanation of the business rationale for the abolition of the Long Term Planner, Facilities Maintenance Engineer and Administrative Assistant positions. It is, unnecessary to go to those reasons in detail because the Union's case did not centre on the argument that PKCT's business needs did not justify the abolition of the relevant positions. In any event, I am satisfied that there were good business reasons for the abolition of the three positions. 126 On 9 December the Union provided a response to PKCT's letter. It maintained that PKCT's actions were inconsistent with the Agreement and complained that the threatened dismissal of Mr Giddings constituted adverse action under the Act. Although the letter threatened legal proceedings the Union noted that the consultation process was not complete and it said that it remained committed to participating in consultation. 127 Early on 9 December Mr Gorman emailed Mr Green, Ms Linton, Mr Tonini and Mr Stewardson (copying Mr Aicken) and said, amongst other things, that: … For the potentially impacted employees that the Company does not take through a voluntary redundancy process (i.e. LTP and FME roles), the 'decision' on Thursday should be the 'decision' to make those potentially impacted employees redundant, with any formal letter of redundancy to be issued on Thursday. As I explain, I see Mr Gorman's use of inverted commas around the word "decision" as indicating that he knew that the decisions concerning the Long Term Planner and Facilities Maintenance Engineer positions had already been made. 128 At about 2.30 pm on the same day, Mr Tonini and Ms Linton met with Ms Ostach, Ms Arber and Ms Maxwell. He asked whether they had any questions about the process and said that they would be provided with further information after management met with the Union on 10 December. 129 Then, at about 3 pm, Mr Tonini met with Ms Linton to discuss the possibility that none of the Administration Assistants would elect to take a voluntary redundancy. Mr Tonini said that there were no suitable vacancies in administrative positions within PKCT or in contractor roles and that he and Ms Linton prepared a draft list of criteria to refer to in case they were required to select a person for forced redundancy. They decided that the selection should be made by reference to length of service, skills relevant to the position, quality of work/accuracy, alignment to PKCT values and potential for development. 130 At 8:11 am on 10 December, before the final consultation meeting with the Union scheduled for 9 am, Mr Green sent an email to, amongst others, Ms Linton, Mr Tonini, Mr Gorman, Mr Stewardson, Ms Uren and Ms Ragen. In it he approved draft letters to Mr Giddings and Mr Rosewarn which included the following passage: We have recently held discussions with you concerning Port Kembla Coal Terminal's decision to undertake an organisational review. As discussed, we have carefully considered all the matters you have raised during the consultation. Regrettably, the outcome of the review and consultation is that your current position is no longer required. 131 The attendees at the final consultation meeting included Mr Green, Mr Stewardson, Mr Tonini and Ms Linton for PKCT and Mr Timbs, Mr Giddings and Mr Dakers for the Union. There are some minor differences in the accounts of what took place at the 10 December meeting but they are not material. Without going to all the detail, the notes of the meeting show that the Union argued that PKCT should offer voluntary redundancies in relation to Mr Giddings' and Mr Rosewarn's positions and that it should consider further avenues to redeploy the affected employees. Mr Timbs asked why PKCT was not exploring all avenues to avoid the forced redundancies of the three affected employees, and complained that PKCT's refusal to provide the requested information about contractors meant that the Union was unable to properly engage in consultation. For his part, Mr Green reiterated his view that PKCT was not obliged to offer voluntary redundancies in relation to positions outside the Finance/Administration team, or to consider reducing contractors' work unless that work was undertaken by contractors engaged on a full time and permanent basis. He argued that because contractors' positions were not permanent and the funding for their work was not guaranteed it was inappropriate to redeploy the affected employees into such positions. Overall, there was little real engagement between the parties in the meeting and they just reiterated their positions. 132 It is significant Mr Timbs told Mr Green that the Union had canvassed some of its members and that there were some employees who were interested in the option of voluntary redundancy. Despite this advice Mr Green made it clear that PKCT would not entertain offering voluntary redundancies in relation to Mr Giddings' and Mr Rosewarn's positions. 133 It is uncontentious that as the meeting drew to a close Mr Green said words to the following effect: … I am not fully au fait with the implications and applications of what has been said. It is given me food for thought. I will see that a decision will be made by tomorrow. As I will explain, that was not the case. In cross-examination Mr Green conceded that before that meeting he had already decided to terminate their employment and that he would not alter that position. 134 Following the meeting Mr Green asked Mr Tonini to estimate the comparative severance costs if, instead of Mr Giddings, Mr Rosewarn and Ms Arber being made redundant, three long serving employees took up voluntary redundancy. Mr Green said that he picked long serving employees as the comparator as they were more likely to take up voluntary redundancy than other employees. 135 On 10 December 2014 Mr Tonini emailed a calculation to Mr Green, Ms Linton and Mr Stewardson in which he estimated the severance cost of Mr Giddings, Mr Rosewarn and Ms Arber at $379,700 and the severance cost of three long serving employees at $482,300. On the same day Mr Green sent an email to, amongst others, Mr Gorman, Mr Stewardson and Mr Tonini said: [t]he data suggests that the bundling of these three potential VRs would be near 100k more in cost than the bundled cost of those roles and current incumbents that might receive redundancies once a decision is taken by the Company. This short analysis does not take into account a 'whole of life' costing across further years, grade levels, etc; however does show at first glance the suggestion is more costly. 136 On 10 December at about 2 pm, Mr Green met with Mr Stewardson, Mr Tonini and Ms Linton. Mr Stewardson said that they discussed the issues raised by the Union during the meeting earlier that day, including the means by which the forced redundancies of the Long Term Planner and Facilities Maintenance Engineer roles might be avoided. Mr Stewardson said that at the conclusion of the meeting Mr Green said that he had considered each of the issues raised by the Union and that he had made the decision that the three identified positions were redundant. They then discussed how the affected employees would be informed of the decision and related administrative issues. 137 I do not accept Mr Green's or Mr Stewardson's evidence about this meeting. In my view Mr Green had made that decision on or about 1 August and there would have been no point in a discussion about the means of avoiding their forced redundancies. I note also that Mr Green conceded that his mind was made up on the morning of that day. 138 At 2:43 pm on 10 December Mr Green emailed his senior managers stating that PKCT had reached a decision to abolish the three affected positions and to terminate the employment of the affected employees, and that letters to the employees had been readied. 139 Then, on the morning of 11 December, in separate meetings Mr Green met with Mr Giddings and Mr Rosewarn, together with the Union. He informed Mr Giddings and Mr Rosewarn that their employment with PKCT had been terminated due to redundancy, effective immediately, and each was given a letter to that effect. 140 Later on 11 December Mr Tonini and Ms Linton met with the three Administration Assistants. Mr Tonini informed them that the opportunity for expressing an interest in voluntary redundancy was soon to close and that if no one elected to take a voluntary redundancy PKCT would select one Administration Assistant for forced redundancy. When none of the Administration Assistants expressed an interest in voluntary redundancy, Mr Tonini and Ms Linton decided to commence a selection process using a selection matrix. 141 Before undertaking the selection process they consulted with Mr Dakers and Mr Owen in relation to the proposed selection criteria of length of service, skills, quality of work/accuracy, alignment to PKCT values and potential for development. Mr Dakers said that he did not accept that these criteria were appropriate as, in his view, cl. 13.5.4 of the Agreement indicated that length of service was the main criteria. He also argued that PKCT was not complying with its obligation to redeploy the affected Administration Assistant into contractors' work. 142 Mr Tonini and Ms Linton made no changes to the selection criteria they proposed. Mr Tonini said that he considered the criteria in the selection matrix and decided that Ms Arber should be selected for redundancy. He said that the decision came down to her trainability and accuracy of work. He recommended to Mr Green that Mr Arber be selected for redundancy and Mr Green accepted the recommendation. The same day Mr Tonini met with Ms Arber and he told her that, based on a selection matrix, she had been selected for redundancy. He informed her that her employment with PKCT had been terminated as a result, effective immediately, and he gave her a letter to that effect.

The reliability OF PKCT's WITNESSES and other evidentiary issues 143 PKCT relied on the evidence of Mr Green, Mr Stewardson, Mr Gorman and Mr Tonini. They gave their evidence in chief by affidavit and faced extensive cross-examination. Although I thought long and hard before reaching this view, I was drawn to conclude that Mr Green's, Mr Stewardson's and Mr Gorman's evidence was quite unreliable. I am satisfied as to the reliability of Mr Tonini's evidence but it is of limited significance to my decision. 144 In their affidavits Mr Stewardson, Mr Gorman and Mr Green each purported to present a comprehensive account of the development of the proposal to abolish positions and terminate the employment of the affected employees. In cross-examination each of them confirmed that this was so. However, each of their carefully constructed affidavits disguised rather than illuminated the decision-making process. Amongst other things, it became clear in cross-examination that each of them had not disclosed important documents and decisions, omitting matters which were contrary to the thrust of PKCT's case. In my view each of them did so deliberately. 145 For example, each of them failed to disclose documents that showed that in April, May and June 2014 (the first three months of the Operational Review) Mr Gorman, Mr Stewardson and Ms Ragen approached the proposal to abolish positions on the understanding that, before implementing forced redundancies, PKCT was obliged to: (a) offer voluntary redundancies in relation to Daywork Appointed positions such as Mr Giddings' and Mr Rosewarn's positions to see whether suitable vacancies might be created into which they could be swapped; and (b) investigate all avenues to avoid forced redundancies including by a reduction of contractors, that is, ascertain whether there was suitable contractors' work into which the affected employees might be placed. At that time there was no suggestion that PKCT should restrict its consideration to contractors engaged on a full time and permanent basis (of which there were none). They did not disclose that they initially thought that there were likely to be suitable positions within PKCT or in contractors' work into which Mr Giddings and Mr Rosewarn might potentially have been redeployed. 146 In my view the evidence tends to show that Mr Green had access to the senior managers' documents through shared links on PKCT's computer network and that he was aware of his senior managers' approach. However, neither he or the senior managers disclosed the relevant documents or decisions in their affidavits. For example none of them disclosed: (a) the Scenario Planner prepared by Mr Gorman in May 2014 which tends to show that he thought that within PKCT there were five suitable positions for Mr Giddings and one suitable position for Mr Rosewarn (if such positions became vacant through offers of voluntary redundancy). Nor did any of them disclose that the Scenario Planner indicates that Mr Gorman thought that there were three suitable contractor roles for Mr Giddings and one for Mr Rosewarn (as well as two "Project/Non EA positions"); (b) the OOR Report which was the central document in planning and documenting the Operational Review. This was a significant omission because the second and third draft OOR Reports in July 2014 show a critical change in PKCT's approach to the proposed abolition of positions. They reveal that, from that date, PKCT approached the proposed abolition of positions on the basis that: (i) voluntary redundancies would not be offered in relation to Mr Giddings' and Mr Rosewarn's positions; and (ii) the consideration of reducing contractors would be limited to contractors engaged on a full-time and permanent basis (when there were no such contractors). None of them disclosed or explained this critical change in their affidavits and Mr Green did not disclose that his decision to abolish the positions and terminate the employment of the affected employees involved this critical change. In my opinion they sought to disguise that fact. 147 None of them disclosed that the final draft OOR Report of 16 October reveals that there was no material change in the proposal from late July. In my view they sought to conceal the fact that by the 1 August meeting Mr Green had been presented with a comprehensive and essentially complete proposal to abolish the relevant positions, and that the proposal did not materially change over the next four months. Revealing this draft report would have seriously weakened PKCT's contention that it had provided timely consultation. Their failure to disclose the OOR Report significantly reduced the credibility of their testimony in my eyes. 148 Further, when it suited Mr Stewardson, Mr Gorman and Mr Green they were exact in their recollection as to the dates of the relevant events. However, when it did not suit them they only offered a broad range of dates for a particular event or occurrence, such as "between July 2014 and late October 2014". They took that approach even though the relevant events occurred only about six months before issue of the proceedings. I do not accept that their recollection was so limited and in some instances I consider they were prevaricating. 149 In my view they were not frank in their evidence about the dates upon which Mr Green made the decisions: (a) to abolish the positions of Mr Giddings and Mr Rosewarn and at least one Administration Assistant; or (b) to terminate the employment of Mr Giddings and Mr Rosewarn rather than redeploy into any suitable vacancies created through offers of voluntary redundancy or by reducing contractors. Except for some refinements which were not material, I consider that Mr Green made those decisions on or about 1 August.

Mr Stewardson's evidence 150 In his affidavit Mr Stewardson said that he worked closely with Mr Gorman and Ms Ragen to identify ways in which the company could achieve efficiencies and reduce costs. As I have said, the Union's case was not centred on the proposition that cost savings at the terminal were unnecessary, and there is no real question in my mind that PKCT truly considered that cost savings were important. 151 The thrust of Mr Stewardson's evidence was that he carefully examined each position in the Engineering team and identified particular positions that could potentially be consolidated or removed while ensuring that PKCT could meet its operational requirements. He said that as part of that process he proposed the abolition of, amongst others, the Long Term Planner and Facilities Maintenance Engineer positions. I infer that he informed Mr Green of the positions he proposed to be abolished early in the Operational Review. It is uncontentious that, at the 1 August meeting, he joined in the recommendation that Mr Giddings', Mr Rosewarn's and at least one of the Administration Assistant positions be abolished. 152 On his evidence he made his recommendation to abolish the relevant positions in good faith and after careful consideration, doing so because they could be abolished while still allowing PKCT to meet its short and long term operational requirements. He said that Mr Green was the decision maker and he corroborated Mr Green's account that he did not make the decision to proceed with the proposal to abolish positions until October 2014. 153 In relation to Mr Giddings' position the gist of Mr Stewardson's evidence was that the recommendation was not actuated in any way by Mr Giddings' Union roles and/or his industrial activities, and that no part of the reasons for recommending the abolition of his position, or Mr Green's reasons for deciding to terminate Mr Giddings' employment, included his Union role and/or his involvement in industrial activities. 154 As I have said, I found Mr Stewardson's evidence unreliable. Notwithstanding that he said that his affidavit was a full account of the relevant decision making process, he failed to disclose important documents and important parts of that process, in my view deliberately. His evidence was implausible in light of the contemporaneous documents and the surrounding facts and circumstances and I give it little or no weight.

Mr Stewardson's failure to disclose important documents and matters 155 First, as part of the relevant decision-making process Mr Stewardson said that he prepared the PowerPoint presentation titled "Operations Review - Indicative Engineering Team Organisation Charts" between June and October 2014. In that presentation he proposed that five positions in the Engineering team be made redundant, including Mr Giddings' and Mr Rosewarn's positions. On the organisational chart he created, under the heading "Nirvana" he had no position for Mr Giddings. It is significant that: (a) he made no mention of the presentation in his affidavit. In cross-examination he said that he prepared it between June to October 2014, but I do not accept that his memory was so poor. On my view of the evidence it is likely that he prepared the presentation in about July 2014; (b) he prevaricated when explaining the "Nirvana" chart but when pressed he conceded that it showed his view that, ideally, Mr Giddings would not be employed in his Engineering team. This was contrary to the thrust of his evidence that he did not have an adverse view about Mr Giddings' work at the terminal or his Union role and industrial activities; and (c) he tried to downplay the importance of the presentation by describing it as a "thought proposal document" and by saying that it was for his own consideration. It is improbable that he would prepare a PowerPoint presentation for his own use rather than just preparing a set of notes, and he accepted that Mr Gorman had prepared some of the organisational charts in the presentation. He offered no cogent explanation as to why Mr Gorman's charts would have been included in his presentation if it was prepared only as a "thought proposal" document for his own use. It is likely that he provided the presentation to Mr Green and the other senior managers through a shared link. 156 In my view he failed to disclose the presentation in an attempt to avoid disclosing his real view about Mr Giddings. I have little doubt that he considered Mr Giddings' Union roles and/or industrial activities were a real impediment to the better operation of the terminal. 157 Second, Mr Stewardson failed to disclose the Scenario Planner in his affidavit. It was prepared by Mr Gorman in June 2014 and Mr Stewardson said he first saw it between June and October 2014 as part of a presentation regarding cost savings at PKCT. I do not accept that his memory was so poor and in my view he was prevaricating in providing that broad timeframe. It is likely that he saw the Scenario Planner in about July 2014. When he was pressed as to why he failed to mention the Scenario Planner he hedged to an extent. It is likely that he did not disclose it because it shows that Mr Gorman was open to redeploying employees in Daywork Appointed positions into vacancies created through offers of voluntary redundancy and by reducing contractors, and that he had identified some potential avenues to avoid the forced redundancies of Mr Giddings and Mr Rosewarn. 158 Third, Mr Stewardson failed to disclose the OOR Report in his affidavit, even though it was the primary planning document in the Operational Review. The second and third draft OOR Reports show that by late July 2014 Mr Gorman and Ms Ragen (with input from Mr Stewardson) had prepared a comprehensive and essentially complete proposal to abolish the positions of Mr Giddings, Mr Rosewarn and two Administration Assistants, which recommended that PKCT make critical changes in its approach to its obligations under the Agreement. The second and third draft OOR Reports provide that PKCT would not make offers of voluntary redundancy in relation to Mr Giddings' and Mr Rosewarn's positions, and that its investigation of reducing contractors would be restricted only to contractors engaged on a full time and permanent basis (when there were no such contractors). Those changes of approach were vital parts of the decision-making process leading to the termination of Mr Giddings' and Mr Rosewarn's employment, yet Mr Stewardson did not disclose them. 159 Mr Stewardson sought to downplay his failure to mention the report on the basis that it was produced by Mr Gorman and Ms Ragen and that he had no input into its content. However, when pressed he conceded that he had reviewed the OOR Report at various meetings and that he had some input into it. He failed to disclose the OOR Report in the context that no other PKCT witness had disclosed it either. 160 Fourth, Mr Stewardson did not disclose that until late May 2014 he thought that it might be possible to redeploy Mr Giddings into other positions or that he had discussed that with Mr Gorman. Under cross-examination he conceded this, and also that his consideration of avenues through which Mr Giddings might be redeployed was an important part of the decision-making process. It is likely that he did not disclose this because it was contrary to the thrust of PKCT's case. 161 Fifth, in his affidavit Mr Stewardson made no mention of the change in his approach to the obligation to offer voluntary redundancies in relation to Daywork Appointed positions before implementing forced redundancies. 162 Sixth, in his affidavit Mr Stewardson made no mention of any assessment undertaken of the nature of the work undertaken by contractors or the necessary skills to perform that work so as to identify any opportunity to redeploy Mr Giddings and Mr Rosewarn into suitable contractors' work. Then, in cross-examination he said that he and Mr Gorman undertook that analysis. I do not accept that he undertook any proper assessment of the work performed by contractors or a proper comparison of the necessary skills for that work against Mr Giddings' and Mr Rosewarn's skill and competencies. It is improbable that he undertook that work when he did not adduce any document to show that he or Mr Gorman did so, and when, from about July, he and Mr Gorman took the view that only contractors engaged on a full time and permanent basis needed to be considered and there were no such contractors.

Other matters going to the credibility of Mr Stewardson's evidence 163 Seventh, on 16 April 2014 Mr Stewardson emailed the Organisational Redesign Stage 2 proposal to Ms Ragen, which identifies Mr Giddings' and Mr Rosewarn's positions amongst the positions in the Engineering team that could be abolished. His proposal included as an assumption that "VRs to be offered and accepted based on the stream as per EA". I take the reference to "stream" to be a reference to the Agreement which categorised employees at PKCT into three streams, Operator, Technical - Lubrication, and Finance/ Administration/ Stores. 164 In my view the proposal tends to show that, at the time, Mr Stewardson understood the Agreement to require PKCT to offer voluntary redundancies to employees working in the same stream as the employee whose position was abolished. In my view he sought to avoid disclosing this as it is contrary to the thrust of PKCT's case. 165 Eighth, in his affidavit Mr Stewardson said that following a meeting on 2 May 2014 he agreed to go away and review the Engineering team's functions with a view to determining if there were any opportunities to consolidate or reduce roles within it. That evidence was implausible when he had already reviewed his team's functions for that purpose on 16 April 2014 and he set out his view in the Organisational Redesign Stage 2 proposal he sent to Ms Ragen. In cross-examination he tried to defend his evidence by insisting that he did not consider his 16 April 2014 proposal to be a detailed one, but he then conceded that he had not subsequently prepared a more detailed proposal. In my view he tried to paint a picture of the proposal to abolish positions being developed later than it in fact was, probably in an effort to support PKCT's argument that it had provided timely consultation. 166 Ninth, in his affidavit Mr Stewardson said that in June 2014 Mr Gorman gave him an amended organisational chart and asked him for his comments in relation to the positions to be abolished. However, he had already provided Mr Gorman with his views on the positions to be abolished in his 16 April 2014 proposal and he conceded in cross-examination that the organisational charts that Mr Gorman gave him included those that Mr Stewardson had himself prepared. In my view he sought to leave the impression that the proposal to abolish positions was developed later than it was. 167 Tenth, the "Phase 2 Background Summary" he prepared in mid-July 2014 included the following passage under the heading "Background": Our business systems (in particular our [enterprise agreement]) create a culture of role protection first rather than business improvement. A culture so engrained that no consultative change management model will achieve cost reduction across an expedient timeframe. Our change management process must revert to a "just do it" model, which then allows people learn new approaches to "survive" in the new paradigm created. 168 Mr Stewardson initially prevaricated as to what he meant in this passage but then conceded that he thought that the consultation process in the Agreement would not allow PKCT to make necessary workplace changes in a timely way. The passage shows that Mr Stewardson thought that PKCT should "just do it" and make necessary workplace changes without going through the required consultation process. He emailed the Background Summary to Mr Green and Ms Ragen on 17 July 2014 in preparation for a meeting on 21 July and it is likely that they considered that approach. His prevarication was most likely an attempt to avoid disclosing his view, because it was contrary to PKCT's case that it provided genuine consultation. 169 Eleventh, Mr Stewardson cut and pasted some text from his earlier Organisational Redesign Stage 2 document into the Phase 2 Background Summary, but he left out the assumption that "VRs [are] to be offered and accepted based on the stream as per EA". In cross-examination he said that he did not include the assumption because he did not think it was relevant to his discussion with Mr Green. I found that explanation implausible. The obligation to offer voluntary redundancies was an important matter, as Mr Stewardson conceded. It must have been clear that the decisions not to offer voluntary redundancies in relation to Mr Giddings and Mr Rosewarn's positions and to restrict the investigation of reducing contractors meant that it was inevitable that their employment would be terminated (if their positions were abolished). It is more likely that Mr Stewardson did not include his earlier assumption because he knew by then that Mr Green had decided that PKCT would not offer voluntary redundancies in relation to their positions.

Mr Gorman's evidence 170 Mr Gorman said that at Mr Green's request, and in response to the deteriorating conditions in the coal industry, he conducted the Operational Review. In the review he said that he considered a range of options to find cost savings. In Phase 2, following discussions with managers in the relevant areas, he said that he identified some positions that could be abolished while still allowing PKCT to meet its operational requirements. He said that after careful consideration he reached the view that the positions of Long Term Planner and Facilities Maintenance Engineer and two Administration Assistants should be abolished. 171 The thrust of his evidence was that he selected those positions for abolition because they were the most appropriate to be abolished, and his recommendation had nothing to do with Mr Giddings' Union roles and/or his industrial activities. He said the decision to abolish the three positions and terminate the employment of the three affected employees was made by Mr Green. In essence Mr Gorman corroborated Mr Green's account that he did not decide to proceed with the proposal to abolish positions until October 2014 and that Mr Giddings' Union role and/or his industrial activities formed no part of Mr Green's reasons for terminating his employment. 172 However, although he said that his affidavit was a full account of the decision-making process leading up to the abolition of the three positions and the resulting termination of employment, it became clear in cross-examination that he had not disclosed a number of important documents and important parts of the decision-making process. I also found his evidence implausible when considered against contemporaneous documents and in light of the surrounding facts and circumstances. In my view his evidence is unreliable and I generally give it little or no weight.

Mr Gorman's failure to disclose important documents and matters 173 First, in his affidavit Mr Gorman did not disclose the document he prepared in June 2014 titled "Review of the obligations regarding workforce reductions". This was an important part of the decision-making process because, amongst other things, it tends to show that at the time he understood the Agreement to require PKCT to offer redeployment and voluntary redundancies before implementing forced redundancies and to require PKCT to investigate all available avenues to avoid forced redundancies including by reducing contractors. It also tends to show that he thought there were potentially available avenues to avoid the forced redundancies of Mr Giddings and Mr Rosewarn. It is likely that Mr Gorman did not disclose this document because it was contrary to PKCT's case. 174 Second, Mr Gorman did not disclose his preparation of the Scenario Planner in June 2014, which identifies the positions that were being considered for abolition under different scenarios, dealing with the affected employees by name and setting out each employee's age, length of service, cost of redundancy, and redeployment options. His failure to disclose this document was significant when he was its author and he conceded in cross-examination that his preparation of it was an important step in the Operational Review. It tends to show that, at the time, he understood the Agreement to require PKCT to redeploy employees into any suitable vacancies created through voluntary redundancy or by reducing contractors (without limiting that consideration only to full time and permanent contractors). It also tends to show his view that Mr Giddings and Mr Rosewarn had suitable skills and competencies for redeployment into various positions within PKCT (if they became vacant through offers of voluntary redundancy) or into contractors' work. 175 Mr Gorman tried to downplay the significance of the Scenario Planner by saying that it dealt with the possibility of redeploying potentially affected employees by reference to what he described as "possible options that the employee felt they might be suitable for redeployment to." He said that when he was developing it he was anticipating the positions to which people might think they could be redeployed, rather than considering where people might actually be redeployed. 176 That evidence is implausible. I do not accept that Mr Gorman's detailed work in ascertaining each affected employees' age, length of service, cost of redundancy, and job swap and redeployment options was undertaken in an effort to anticipate the positions to which people might think they could be redeployed when he had not even spoken to them. I have little doubt that in creating the Scenario Planner he was setting out his own view as to the redeployment options that were potentially available for each of them. It is likely that Mr Gorman did not disclose the Scenario Planner because it was contrary to PKCT's case. 177 Third, Mr Gorman did not disclose the OOR Report in his affidavit. This failure was particularly important because the OOR Report was the primary planning document in the Operational Review and he was one of its authors. This failure occurred in the context that no other PKCT witness disclosed it either, and in my view his omission was deliberate. His affidavit purported to be a full account of the decision-making process, as he confirmed in cross-examination, but by not disclosing the main report planning and documenting the review his evidence regarding the decision-making process was materially incomplete. The draft OOR Reports throw a quite different light on PKCT's decisions and the decision-making process. 178 It is likely that he did not disclose the OOR Reports because: (a) the first draft OOR Report tends to show that, at the time, he understood the Agreement to require PKCT to redeploy the affected employees into suitable vacancies created through offers of voluntary redundancy (without limiting that only to the Administration Assistant positions) or by reducing contractors (without limiting its consideration only to full-time and permanent contractors). It also tends to show that, at the time, he thought there were likely to be avenues for the redeployment of Mr Giddings and Mr Rosewarn; (b) the second and third draft OOR Reports in July 2014 show the critical change in PKCT's approach to the Agreement to which I have referred. This had the effect that it was inevitable that Mr Giddings and Mr Rosewarn would lose their jobs rather than be redeployed (if their positions were abolished as proposed); and (c) the second and third draft OOR Reports reveal that by 1 August 2014 Mr Green had been provided a comprehensive and essentially complete proposal to abolish the relevant positions. Revealing this fact would have seriously undermined PKCT's contention that it provided timely consultation to the Union. 179 Mr Gorman was alive to the risk that his failure to disclose the OOR Report could damage his credibility. I say this because he tried to downplay his role in the OOR Report, and initially testified that his contribution to the first draft OOR Report was just by amending matters of form from a document he obtained from Illawarra Coal. Under further cross-examination he conceded that he contributed to the substance of the report, but without providing any detail in that regard. It was only when he was taken through each section of the first draft, one by one, that he admitted that he had written almost all of it. This did him no credit. In my opinion he then sought to leave the impression that his input into the OOR Report was confined to the first draft, but he later accepted that he also had input into the second draft. It is likely that he played a significant role in the preparation of each draft of the OOR Report, and that each iteration reflected his views at that point in time. 180 Fourth, Mr Gorman did not disclose that in late June 2014 he advised Mr Green that PKCT should not offer voluntary redundancies in relation to Daywork Appointed positions, because it would reduce the cost savings that could be achieved by forced redundancies. This was plainly an important step in the decision-making process leading to the termination of Mr Giddings' and Mr Rosewarn's employment, as Mr Gorman acknowledged in cross-examination. He offered no cogent explanation for his failure to disclose it. It is likely that he did not do so in an effort to avoid disclosing that a desire to save costs underpinned a recommendation which, on its face, was inconsistent with the view he held, at the time, of PKCT's obligation to offer voluntary redundancies.

Other matters going to the credibility of Mr Gorman's evidence 181 Fifth, Mr Gorman was asked whether in preparing the "PKCT Operational Review summary paper" in June 2014 he was concerned to avoid forced redundancies, and he conceded that this was not his objective at the time. This was a significant concession, and against the thrust of his evidence that he had investigated all avenues for the redeployment of Mr Giddings and Mr Rosewarn but there were no suitable positions within PKCT or in contractors' work. 182 Sixth, Mr Gorman said that through August and September 2014 he began to develop a "consultation plan" to assist in PKCT's consultation with the Union. I found his evidence improbable given he had prepared a consultation plan and timetable on 2 July 2014 in the first draft OOR Report. I saw this evidence as an attempt to paint a picture of the proposal to abolish positions having been developed later than it actually was, probably in support of PKCT's case that it provided timely consultation. 183 Seventh, I found implausible his evidence about an email he sent on 9 December to Mr Green and other managers, relating to the then ongoing consultation process. The email stated: …perhaps the 'decision' on Thursday should be the 'decision' to nominate the time for the voluntary redundancy to close (perhaps by 9am Friday) with a view to finalising any redundancies from this group on Friday, with any formal letter of redundancy to be issued on Friday. For the potentially impacted employees that the Company does not take through a voluntary redundancy process (i.e. LTP and FME roles), the 'decision' on Thursday should be the 'decision' to make those potentially impacted employees redundant, with any formal letter of redundancy to be issued Thursday. 184 Mr Gorman said that his repeated use of inverted commas around the word 'decision' was merely a reference to a specific decision concerning the abolition of the Long Term Planner and Facilities Maintenance Engineer positions, which was yet to be decided. Standing alone I would not give Mr Gorman's repeated use of inverted commas much significance but viewed against the surrounding facts the email tends to show Mr Gorman's appreciation of the legal significance of when PKCT could be said to have made the relevant "decision" to abolish positions. It is likely that he put the word 'decision' in inverted commas because there were no real decisions left to be made. 185 Eighth, in his affidavit Mr Gorman referred to Ms Ragen's "Operational Review - May 2014" presentation which contains a proposal to abolish positions in the Engineering team (including Mr Giddings' and Mr Rosewarn's positions) and envisages that Mr Giddings could be redeployed to other work. In cross-examination he initially said he was uncertain as to who prepared the presentation but he later accepted that it was prepared by Ms Ragen and said that she prepared it independently from him. I found it implausible that there was any uncertainty in his mind as to whether Ms Ragen prepared the presentation, and improbable that she prepared it independently from him when he was the manager in charge of the Operational Review. It is likely that he sought to distance himself from the indication in the presentation that Mr Giddings could potentially be redeployed. 186 Ninth, in his affidavit he said that in early June 2014 he prepared the "PKCT Operational Review summary paper" in which he outlined his preliminary thoughts on proposals to save labour costs. This paper tends to show that he understood the Agreement to require PKCT to offer voluntary redundancies before implementing forced redundancies, and indicates that he thought the requirement to offer voluntary redundancies was inefficient and/or costly. In cross-examination, Mr Gorman tried to talk down the importance of the document by saying that he had prepared it for his own purposes and that he did not give the document to anybody else. He said that he could not recall discussing with Mr Stewardson what positions could be abolished in the Engineering team before he prepared the document. 187 That evidence is implausible. It is unlikely that he would propose the abolition of positions in the Engineering team without first discussing that with Mr Stewardson. Further, the summary was endorsed with a claim that it was prepared for the purpose of obtaining legal advice. He said that he did not endorse the document with that claim, but he or someone else in PKCT management must have done so. Accepting his evidence that he did not make the privilege claim he must have given access to the document to someone else which points away from it having been prepared only for his own purposes. 188 Tenth, although he made no mention of this in his affidavit, Mr Gorman said in cross-examination that in late June 2014 he recommended to Mr Green that voluntary redundancies should not be offered outside the Finance/Administration team because this would have reduced cost savings. He said that he did not tell Mr Green that he considered that Mr Giddings and Mr Rosewarn were capable of performing a range of other roles within the Engineering team, because he was not asked by Mr Green and because he thought that it would not be relevant to Mr Green's decision. 189 I found that evidence implausible. He must have known that Mr Green needed to form a view as to whether Mr Giddings and Mr Rosewarn had suitable skills and competencies to undertake other positions within PKCT, because that was an important step in PKCT complying with the obligations to use redeployment and voluntary redundancies before implementing forced redundancies and to investigate all avenues to avoid forced redundancies. It is difficult to see why Mr Gorman would recommend against offering voluntary redundancies in relation to Mr Giddings' and Mr Rosewarn's positions because that would save costs, if they could not have been redeployed in any event because they did not have suitable skills. It is more likely that he told Mr Green that while Mr Giddings and Mr Rosewarn were capable of undertaking other positions within PKCT, they should not be swapped into those positions because it would mean lower cost savings.

Mr Green's evidence 190 Mr Green consistently said that there were genuine operational reasons for proposing the abolition of the Long Term Planner, Facilities Maintenance Engineer and one or two Administration Assistant positions. He said that the abolition of those positions was appropriate because of the cost savings and efficiencies that could be achieved as a result, and the ability of other employees to absorb those functions. He gave detailed evidence as to the business case for the abolition of the three positions and I largely accept his evidence in that regard. I note again that the Union's case did not centre on the proposition that PKCT's business needs did not justify abolition of the affected positions. 191 Mr Green said that, while he relied on the recommendations of his senior managers in arriving at his decision to propose the abolition of positions, the final decision was his. He said that he gave careful consideration to his senior managers' recommendations at the meeting on 1 August 2014 but did not make the decision on the recommendation until mid-October 2014. On his evidence he did not make a final decision even then. The thrust of his evidence is that even in mid-October his decision was not final, because at that point he only decided to advance the proposal to abolish positions subject to consultation with the Union. 192 He said that PKCT genuinely consulted with the Union from 2 to 10 December 2014 and that throughout that process he kept an open mind to the concerns and alternative views expressed by the Union. Mr Green said that it was not until after consultation was complete that he decided to abolish the positions of the three affected employees and to terminate their employment. 193 He denied having any animus towards Mr Giddings, and he denied that any part of the reasons for his decision to terminate Mr Giddings' employment included his Union roles and/or his industrial activities. 194 However, although his affidavit purported to be a full account of the decision-making process (which he confirmed in cross-examination) he failed to disclose some important documents and important parts of the decision-making process. In my view his failure was deliberate. Amongst other things his evidence was implausible when considered against the contemporaneous documents, and in the light of the surrounding circumstances and other evidence which I prefer. I also found his evidence that he did not have an adverse view of Mr Giddings to be implausible. I concluded that his evidence was unreliable and I give it little or no weight. I now detail my assessment of the reliability of his evidence, although I deal separately with the implausibility of his evidence about his view of Mr Giddings.

Mr Green's failure to disclose important documents and matters 195 First, in his affidavit Mr Green did not disclose that he saw Ms Ragen's "Operational Review - May 2014" presentation prepared for a meeting on 23 May 2014. While he accepted that Ms Ragen provided him with a version of the document and that he discussed it with her, he said that he could not recall the date she did so. I found it implausible that he did not know approximately when he was provided with the presentation and had a discussion with Ms Ragen about it. It is improbable that Ms Ragen gave him access to it later than the end of June because by 2 July it would have been superseded by the first draft OOR Report. He offered no cogent explanation for his failure to disclose that he saw this presentation and that he discussed it with Ms Ragen. 196 Second, Mr Green did not disclose that before he made his presentation to the Lodge AGM on 4 July 2014, Mr Gorman had provided him with a revised organisational chart which indicated the abolition of a number of positions, including Mr Giddings' position. In cross-examination he accepted that being provided this organisational chart was relevant because it showed when particular information came to his attention. It was plainly relevant to whether PKCT provided timely consultation and he offered no cogent explanation for his failure to disclose it. 197 Third, and more importantly, Mr Green did not disclose the OOR Report. In cross-examination he accepted that he was provided with a draft OOR Report in early July 2014 and said that was when he first became aware of the detail of the proposal to abolish positions. In my view it is likely that he saw each draft OOR Report through a shared link on PKCT's computer network and that he saw the first, second and third draft OOR Reports in July 2014. 198 Mr Green said that he understood from the draft OOR Report that he saw, that his senior managers were recommending the abolition of positions, including the Long Term Planner and Facilities Maintenance Engineer positions occupied by Mr Giddings and Mr Rosewarn, and that no voluntary redundancies were proposed to be offered in relation to those positions. 199 Mr Green's failure to disclose the OOR Report occurred in the context that no other PKCT witness disclosed it either, and in my view it was not just a mistake. He did not disclose it even though it was the main report planning and documenting the Operational Review and it reveals the critical change in PKCT's approach to its obligations under the Agreement. In my view his failure was deliberate. Mr Green conceded that his receiving and reading the report was an important part of the decision-making process and that its subject was a "very significant matter" for his consideration, and he offered no cogent explanation for not disclosing it. 200 It is likely that he did not disclose the OOR Report for essentially the same reasons as Mr Gorman, including that the draft reports tend to show the critical change in PKCT's approach to its obligations under the Agreement, that the senior managers thought there were potentially available avenues for the redeployment of Mr Giddings and Mr Rosewarn, and that by 1 August he had received a comprehensive and essentially complete proposal to abolish the relevant positions. Amongst other things, the second and third draft OOR Reports undermined his evidence that PKCT provided the Union timely and genuine consultation.

The timing of Mr Green's decisions 201 I also found implausible Mr Green's evidence regarding the timing of his various decisions. 202 In his affidavit he said that he did not make a decision at the time he received the recommendation to abolish positions on 1 August 2014. He said that he gave the recommendation consideration over the next two and a half months, and met with the senior managers in relation to the proposal on several further occasions in the period until mid-October. On his account it was not until mid-October that he decided to advance the proposal to abolish the relevant positions, subject to any further considerations raised during the consultation process. He said that he decided not to offer voluntary redundancies in relation to Mr Giddings' and Mr Rosewarn's positions at the same time. 203 His evidence is that it was not until 10 December 2014, after consultation with the Union, that he decided to limit the consideration of reducing contractors, to abolish the three affected positions and to terminate the employment of the three employees. I found this evidence improbable. Although his evidence was corroborated by Mr Gorman and Mr Stewardson I found their evidence unreliable too. I now deal with the unreliability of his evidence about the timing of his decisions: (a) not to offer voluntary redundancies in relation to the abolition of Mr Giddings' and Mr Rosewarn's positions; (b) to restrict PKCT's investigation of reducing contractors, such that it was only required to consider contractors engaged on a full time and permanent basis (of which there were none); and (c) to abolish the positions of Mr Giddings, Mr Rosewarn and one Administration Assistant and to terminate their employment.

Mr Green's evidence as to when he decided not to offer voluntary redundancies 204 Mr Green said that he decided that PKCT would not offer voluntary redundancies in relation to Mr Giddings' and Mr Rosewarn's positions in mid-October or near the end of October 2014. This evidence is implausible. 205 In his affidavit Mr Green did not disclose that, in late June 2014, he was advised by Mr Gorman that voluntary redundancies should not be offered in relation to Mr Giddings' and Mr Rosewarn's positions because it would reduce cost savings. It was not until he was cross-examined that he said that he was aware from about July 2014 of the proposal not to offer voluntary redundancies in relation to their positions. He conceded that whether or not voluntary redundancies were offered was an important issue but he offered no cogent explanation for his failure to mention Mr Gorman's advice. He said that he could not remember discussing that issue with Mr Gorman in late June but I prefer Mr Gorman's evidence as to the date of discussion. I doubt that Mr Green had forgotten discussing that important question with Mr Gorman and in my view he sought to conceal the early date upon which he first considered not offering voluntary redundancies. 206 It is unlikely that Mr Green would have taken until mid-October to decide this issue when he had received Mr Gorman's advice not to offer voluntary redundancies in late June and on 1 August he received the same recommendation from his senior managers. He offered no persuasive explanation as to why he took such a long time, and PKCT adduced no contemporaneous document which shows that Mr Green ever considered taking a different course from that which was recommended to him. 207 The contemporaneous documents show that from about mid-July Mr Gorman, Mr Stewardson and Ms Ragen approached the proposed abolition of positions on the basis that PKCT would not offer voluntary redundancies in relation to Daywork Appointed positions. Not one contemporaneous document showed that Mr Green queried this approach or that he was still giving this issue his consideration after 1 August. I would expect there to have been at least one document which shows that this important issue was still under consideration, rather than already decided, if that was in fact the case. 208 If Mr Green was, in reality, undecided as to whether voluntary redundancies would be offered it was necessary for somebody to undertake a comparative assessment of Mr Giddings' and Mr Rosewarn's skills and competencies against the skill sets required in other possibly suitable positions within PKCT. Yet PKCT put forward no cogent evidence, and did not adduce any contemporaneous document, to show that such an assessment was properly undertaken at any point between 1 August and late October. Mr Gorman said that the Scenario Planner was merely his attempt at anticipating the positions into which potentially affected employees might think they could be redeployed, and he did not even speak to the relevant employees. The highest the evidence rose was that Mr Stewardson said Ms Uren prepared a matrix which included a comparative analysis, but he admitted that he had not seen the matrix, PKCT did not produce it and Ms Uren did not give evidence. I do not accept that this work was ever properly undertaken. It is likely that the senior managers did not undertake this work because they knew that Mr Green had already decided not to offer voluntary redundancies in relation to Mr Giddings' and Mr Rosewarn's positions. 209 On my view of the evidence it is likely that Mr Green made the decision not to offer voluntary redundancies in relation to Mr Giddings' and Mr Rosewarn's positions on or about 1 August 2014.

Mr Green's evidence as to when he decided to limit PKCT's consideration in relation to reducing contractors 210 Mr Green said that it was not until 10 December 2014 that he decided that, in seeking to avoid forced redundancies, it was appropriate to restrict PKCT's consideration of reducing contractors only to contractors engaged on a full time and permanent basis. I found this evidence implausible. 211 First, I note that Mr Green did not disclose the fact that his senior managers had initially taken a different approach on this question, but in July they changed their approach and proposed the abolition of positions on the basis that, in investigating all avenues to avoid forced redundancies, PKCT was not required to consider reducing contractors, unless the contractor was engaged on a full time and permanent basis. PKCT did not adduce any contemporaneous document which shows that Mr Green queried this change in approach, even though it made it inevitable that Mr Giddings' and Mr Rosewarn's employment would be terminated (if their positions were abolished). If this question was undecided in the period from 1 August 2014 until 10 December 2014 I would expect such a document to have existed. 212 Second, unless the senior managers knew that Mr Green took the same view as they did, it is likely that between mid-July and 10 December the senior managers would have sought some clarity on this important issue from Mr Green. PKCT did not adduce any cogent evidence or a single contemporaneous document which shows that they sought such clarity. 213 Third, Mr Gorman said that the decision to limit the consideration of reducing contractors' work resulted from legal advice, authorised by Mr Green in June 2014, which clarified PKCT's position under the Agreement. I infer that the advice was received in about July 2014 and it is more likely than not that Mr Green made up his mind at around that time rather than months later in December 2014. 214 Mr Green must have known that restricting PKCT's consideration of reducing contractors, to the point that there were no contractors to be considered, in combination with his decision not to offer voluntary redundancies in relation to their positions, meant that it was inevitable that Mr Giddings and Mr Rosewarn would not be redeployed. It is inherently unlikely that Mr Green would have deferred the important decision as to whether redeployment was open until the very day that he decided to abolish their positions. It is much more likely that he decided that issue earlier. 215 Fourth, if the reality is that it was not until 10 December that Mr Green made his decision about restricting PKCT's consideration of reducing contractors he could not have known at the time he terminated Mr Giddings' and Mr Rosewarn's employment whether they could have been redeployed into contractors' work or not. Mr Gorman's advice to Mr Green about suitable contractors' work for their redeployment was provided on the assumption that only full time and permanent contractor roles were required to be considered and therefore, if he had not already made up his mind, Mr Green did not know what suitable non-permanent contractor roles might be available for their redeployment. It is improbable that Mr Green would have left his decision on the possibility of their redeployment to the same time as his decision on terminating their employment. 216 Fifth, it is significant that Mr Gorman operated on the assumption that he need only consider full time and permanent contractor roles. It tends to show that he understood that Mr Green had already decided to limit PKCT's consideration of contractors' work. 217 Sixth, in my view the construction of the Agreement pursuant to which PKCT's obligation to investigate reducing contractors was restricted to contractors engaged on a full time and permanent basis (when none were) was somewhat contrived. Mr Green must have known that construction was not the intention of the parties at the time they entered into the Agreement. Unless, from 1 August until 10 December, the senior managers understood that Mr Green had already decided to adopt that approach it is unlikely that they would have continued to advance a proposal based upon this artificial construction. 218 On my view of the evidence it is likely that Mr Green made the decision to limit PKCT's consideration of reducing contractors' work on or about 1 August 2014.

Mr Green's evidence as to when he decided to abolish the affected positions 219 Mr Green's evidence as to precisely when he made the decision to propose the abolition of the affected positions was somewhat uncertain. In his affidavit he said that he made the decision in mid-October 2014, but in cross-examination he altered his testimony a little and he said that he made the decision on 29 October or in early November. 220 In my view Mr Green's evidence that he made this decision on one or other of those dates, rather than on or about 1 August, is implausible. First, I say this because I found Mr Green's evidence generally unreliable. Second, I also found his uncertainty about the exact date of his decision difficult to understand when the proposal to abolish positions involved a great deal of managerial planning and was executed with military precision. He was served with these proceedings in late December 2014 and he swore his affidavit in February 2015, and it is unlikely that his memory was so reduced by the effluxion of time that he could not accurately recollect the date that he made that important decision. It should have been a straightforward matter to recollect. 221 Third, his decisions not to offer voluntary redundancies in relation to Mr Giddings' and Mr Rosewarn's positions and to restrict PKCT's consideration of reducing contractors are inextricably intertwined with his decision to abolish positions. My view as to the unreliability of his evidence on the timing of those two decisions also affects my view on the reliability of his evidence on this issue. 222 Fourth, it is improbable that the critical change to PKCT's approach to voluntary redundancies and the investigation of reducing contractors would have been included in the OOR Report without Mr Green's approval. The first, second and third draft OOR Reports in July 2014 reveal this change in approach. The second and third draft OOR Reports show that an essentially complete proposal was before him at the 1 August meeting, and there was no material change in the proposal between then and 2 December. 223 PKCT did not adduce a single contemporaneous document to show that in the period from 1 August 2014 Mr Green took any step to consider or evaluate whether to offer voluntary redundancies or whether to restrict the investigation of reducing contractors, both of which were central to the proposal. Nor did it adduce a single document to show that Mr Green took a different view to the recommendations he received from his senior managers. Mr Green advanced no cogent explanation for why he might have chosen not to follow the recommendations he received. 224 Fifth, the later contemporaneous documents tend to show fine tuning or finessing of a plan already made, or the taking of steps to implement a decision already made. For example, the documents attached to Ms Ragen's 23 October 2014 email, including a Detailed Execution Timeline and Calendar and template letters to employees who were to be made redundant, point towards the decision to abolish the positions of Mr Giddings, Mr Rosewarn and one Administration Assistant having already been made. 225 Sixth, Mr Green displayed a preparedness to mislead in relation to the timing of his decision to terminate the employment of the affected employees. In the final consultation meeting with the Union on 10 December 2014 he pretended he was still considering the Union's views when, on his own evidence, he had already decided to terminate the employment of Mr Giddings, Mr Rosewarn and one Administration Assistant. 226 It is likely, in my view, that Mr Green made his decision to abolish the positions and terminate the employment of Mr Giddings, Mr Rosewarn and at least one Administration Assistant on or about 1 August 2014. It is likely that the only significant decision he left until mid-October, late October or early November 2014 was when to announce the proposal to abolish positions.

Mr Tonini's evidence 227 Mr Tonini said that his involvement in the Operational Review began in June 2014 when he was asked by Mr Gorman and Ms Ragen to consider the operational efficiency of the Finance/Administrative team which he managed, including by considering what cost savings might be achieved. He said that he carefully assessed the potential cost savings from abolition of positions and sought to balance the cost pressures faced by PKCT against the operational requirements of his team. 228 The evidence shows that Mr Tonini informed Mr Gorman at an early date that it was only feasible to reduce his team by one Administration Assistant position but, for reasons that are unclear to me, it appears that the proposal initially went forward on the basis that two Administration Assistant positions were to be abolished. That is the state of the proposal in the second and third draft OOR Reports. However, by the time Mr Green says he decided to advance the proposal in October, it went forward on the basis that only one Administration Assistant position was proposed to be abolished. 229 Mr Tonini gave evidence regarding the consultation process relating to the proposed abolition of one Administration Assistant position, the offers of voluntary redundancy made to each of the three Administration Assistants, and the process used to select Ms Arber for compulsory redundancy when none of them took up the offer. In my view he gave reliable evidence and I broadly accept it.

PKCT's failure to call Ms Ragen 230 In their affidavits Mr Gorman, Mr Stewardson and Mr Green disclosed nothing about the role of the Human Resources Manager, Ms Ragen, in the second third and final draft OOR Reports and said little about her role in the Operational Review. However, in cross-examination it became clear that she played an important role in developing and documenting the proposal to abolish positions. Amongst other things: (a) on 16 April 2014 Mr Stewardson emailed his proposal to abolish positions in the Engineering team to her, which indicates she had a role from the beginning of the Operational Review; (b) she developed the first detailed Operational Review proposal in May 2014 in which she envisages that Mr Giddings could be redeployed to other work); (c) she was involved in the decisions in June and July 2014 to make critical changes to PKCT's approach to offering voluntary redundancies and to investigating reducing contractors; (d) she played a significant role in the second, third and final draft OOR Reports; (e) Mr Stewardson followed her advice in restricting his consideration of reducing contractors only to contractors engaged on a full time and permanent basis; and (f) she advised Mr Gorman to mark some of his documents with a claim of legal professional privilege. 231 Notwithstanding Ms Ragen's important role in planning and documenting the proposal to abolish positions PKCT did not call her to give evidence. It offered no cogent explanation in relation to the failure to call her and I infer that her evidence would not have assisted it: Jones v Dunkel (1959) 101 CLR 298.

The alleged waiver of legal professional privilege 232 The evidence shows that Mr Gorman had some concerns about the proper operation of the Agreement, that he was authorised by Mr Green to obtain legal advice on PKCT's behalf, and that he sought and obtained that advice. The Union contended that, in a brief exchange in re-examination of Mr Gorman, PKCT waived privilege in legal advice it had received. 233 In cross-examination of Mr Gorman the following exchange occurred: MS HOWELL: Now, you're aware, aren't you, that the company has taken the view that contractor positions are only relevant to this exercise if they are permanent and full time?---Yes Do you know when the company decided that that was an appropriate position to 15 take?---I think late June 2014. Do you know what the process was whereby that view was - or position was arrived at?---Yes, it was arrived at as a result of seeking legal advice on the matter. 234 Then, in re-examination counsel for PKCT returned to the issue. The following exchange in ensued: MR PRINCE: Now, you were asked questions about whether - in terms of the contractor roles, not needing to be full time or permanent - sorry, needing to be full time and permanent. Do you remember those questions?---Yes. And you gave evidence that that position was arrived at as a result of seeking legal advice. Do you remember that - giving that answer?---Yes. And don't reveal what the advice was please, Mr Gorman, but can you say whether that advice had an impact on you reaching that position? HIS HONOUR: I don't think you can ask him that question without waiving privilege, Mr Prince. MS HOWELL: I don't object. MR PRINCE: Well - - - HIS HONOUR: Well, if this witness answers that that advice impacted on him reaching a particular position, why wouldn't you have waived privilege and not be entitled to the benefit of the privilege you're presently maintaining? MR PRINCE: There's not much of it left, but perhaps I should - I will frame the question in another way. Why did you seek legal advice in relation to that matter?---I was unclear on what - how our obligations were to be framed, so I was seeking clarity on that. And following the provision of legal advice, did you feel that you had that clarity?---Yes. Thank you. 235 The Union noted that in cross-examination Mr Gorman disclosed that PKCT had taken a position as a result of seeking legal advice on that matter. Counsel for PKCT made no objection to the question being asked and made no attempt to strike the answer. Then, in re-examination, counsel for PKCT returned to the issue. The Union argued counsel for PKCT had deliberately taken the course he did, in the face of a caution from the Court and that the re-examination reinforced the evidence given in cross-examination, added the further component that the legal advice had provided some clarity in circumstances where there had hitherto been some lack of it. 236 The Union contended that in deploying the effect of legal advice for its forensic purpose PKCT had conducted itself in a way which was inconsistent with the maintenance of the confidentiality that attracts legal professional privilege: Bennett v Chief Executive Officer, Australian Customs Service (2004) 140 FCR 101 (Gyles J). It contended that it would be unfair for PKCT to rely as it does upon the evidence of Mr Gorman without it being afforded an opportunity to interrogate the content of the legal advice. 237 Whether privilege is waived by disclosure of the conclusion, gist, substance or effect of legal advice depends on whether, in the particular context and circumstances of the case, the requisite inconsistency exists between the partial disclosure on the one hand and the maintenance of confidentiality in the whole advice on the other. The judgment as to inconsistency is to be made not only in the context and circumstances of the case, but also in light of any considerations of fairness arising from the context and circumstances: Secretary, Department of Justice v Osland (2007) 95 ALD 380 at [49]; approved by the High Court in Osland v Secretary, Department of Justice (2008) 234 CLR 275 at [44]-[50]. 238 In the present case it cannot be said that the questioning of Mr Gorman disclosed the conclusion, gist or substance of the legal advice. At most Mr Gorman disclosed that PKCT's approach to its obligation to investigate reducing contractors was the "result of" legal advice received which "clarified" its approach. 239 Whether disclosing the effect of legal advice in that way constitutes a waiver of privilege involves matters of fact and degree: Nine Films & Television Pty Ltd v Ninox Television Ltd (2005) 65 IPR 442. On balance I am not satisfied that Mr Gorman waived privilege in PKCT's legal advice. His answers did not reveal the conclusion, gist, or substance of the advice and it revealed the effect of the legal advice in only the broadest terms. In submissions PKCT did not rely on the conclusion, gist, substance or effect of the advice in any way. In my view there is no unfairness or inconsistency between PKCT's reliance on Mr Gorman's evidence and its maintenance of privilege over the legal advice received.

The construction of industrial instruments 240 The principles applicable to construing industrial instruments are settled. In dealing with the construction of awards in Kucks v CSR Limited (1996) 66 IR 182 ("Kucks")at 184 Madgwick J observed: It is trite that narrow or pedantic approaches to the interpretation of an award are misplaced. The search is for the meaning intended by the framer(s) of the document, bearing in mind that such framer(s) were likely of a practical bent of mind: they may well have been more concerned with expressing an intention in ways likely to have been understood in the context of the relevant industry and industrial relations environment than with legal niceties or jargon. Thus, for example, it is justifiable to read the award to give effect to its evident purposes, having regard to such context, despite mere inconsistencies or infelicities of expression which might tend to some other reading. And meanings which avoid inconvenience or injustice may reasonably be strained for. For reasons such as these, expressions which have been held in the case of other instruments to have been used to mean particular things may sensibly and properly be held to mean something else in the document at hand. (Emphasis added.) 241 In Short v FW Hercus Pty Ltd (1993) 40 FCR 511 Burchett J (with whom Drummond J agreed on this point) explained that an industrial instrument has to be read "in its context". His Honour said (at 517) that "the circumstances of the origin and use of the clause are plainly relevant to an understanding of what is likely to have been intended by its use" and concluded (at 518): Where the circumstances allow the court to conclude that a clause in an award is the product of a history, out of which it grew to be adopted in its present form, only a kind of wilful judicial blindness could lead the court to deny itself the light of that history, and to prefer to peer unaided at some obscurity in the language. "Sometimes", McHugh J said in Saraswati v The Queen (1991) 172 CLR 1 at 21, the purpose of legislation "can be discerned only by reference to the history of the legislation and the state of the law when it was enacted." Awards must be in the same position. 242 These observations have been cited with approval in numerous decisions. In Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241 ("Amcor") two members of the High Court approved the passage in Kucks (Kirby J at [96] and Callinan J at [130]). Kirby J explained: The nature of the document, the manner of its expression, the context in which it operated and the industrial purpose it served combine to suggest that the construction to be given to cl 55.1.1 should not be a strict one but one that contributes to a sensible industrial outcome such as should be attributed to the parties who negotiated and executed the Agreement. Approaching the interpretation of the clause in that way accords with the proper way, adopted by this Court, of interpreting industrial instruments and especially certified agreements. (Citations omitted.) Two other members of the Court in Amcor (Gleeson CJ and McHugh J at [2]) explained that the construction of an industrial agreement "turns upon the language of the particular agreement, understood in the light of its industrial context and purpose." 243 A short time later in City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union (2006) 153 IR 426 at 440, French J said: It is of course necessary, in the construction of an award, to remember, as a contextual consideration, that it is an award under consideration. Its words must not be interpreted in a vacuum divorced from industrial realities - City of Wanneroo v Holmes (1989) 30 IR 362 at 378-379 and cases there cited. There is a long tradition of generous construction over a strictly literal approach where industrial awards are concerned - see eg George Bond and Co Ltd (in liq) v McKenzie [1929] AR (NSW) 498 at 503-4 (Street J). 244 In Australasian Meat Industry Employees Union v Coles Supermarkets Australia Pty Ltd (1998) 80 IR 208 at 212, Northrop J agreed with Madgwick J's observations in Kucks and held that they had an even stronger application to certified agreements than they did to awards. 245 More recently, in Shop Distributive and Allied Employees' Association v Woolworths SA Pty Ltd [2011] FCAFC 67 (Marshall, Tracey and Flick JJ) ("SDA v Woolworths") at [14]-[18] the Full Court endorsed the proposition that a paramount consideration in construing an industrial agreement was its industrial context and the intention or purpose of its makers: see also United Voice v Valspar (WPC) Pty Ltd (2014) 218 FCR 521 at [2] (Marshall and Perry JJ). 246 I apply these principles in construing the Agreement.

The terms of the Agreement 247 Clause 7 of the Agreement provides: 7. Workplace Change and Consultation 7.1 Consultation over significant change or effect will occur where: a. the Company is considering introducing a major change to production, program, organisation, structure, technology, shift arrangements, work organisation or the level of outsourcing in relation to its enterprise; and b. the change, if implemented, is likely to have a detrimental or significant effect on employees. 7.2 The purpose of consultation is to: a. Resolve issues, where possible, at the workplace and avoid unnecessary problems by identifying and discussing matters of actual or potential concern as close to the workplace as possible; b. Improve the level of understanding between management, Employees and Employee Representatives by exchanging relevant information on a timely basis; and c. Deliver an efficient decision-making process by ensuring Employees are aware of a review of their work area that could lead to significant change or effect on working arrangements and allowing Employees and Employee Representatives inputs to be taken into consideration through a process of consultation, prior to a final decision being taken by management. 7.3 The Company will give prompt and genuine consideration to matters raised by the relevant Employees and their Employee Representatives. 7.4 The Company will notify the relevant Employees and their Employee Representatives of the proposed change as soon as a decision has been made. 7.5 The consultation process may be modified by agreement between the parties. 7.6 Significant change or effect may include but is not limited to: a. major changes in the composition, operation or size of the Company's workforce; or b. the skills required; or c. the significant restructuring of work organisation; or d. proposals by the Company to outsource services or contract out services currently provided by Company Employees. 7.7 The above definition seeks to illustrate that the changes requiring extensive consultation generally need to have broad impacts and be likely to affect a significant part of the Company's operations or affects Employees' working arrangements. 7.8 The consultations will be conducted within a context which acknowledges the statutory obligations and responsibilities of the Company and where the Employees and Employee Representatives do not have a power of veto over the Company's final decision. This does not affect the right of the Employees or their representatives to notify a dispute through the agreed Dispute Settlement Procedure. (Emphasis added.) 248 Clauses 13.5.2 and 13.5.4 are also relevant. They provide: 13.5 Redundancy … 13.5.2 If workforce reductions for Employees bound by this Agreement were to become necessary, they will be undertaken through the consultative process described in this Agreement. … 13.5.4 If a redundancy situation still exists after the above steps have been taken [namely the use of redeployment, voluntary redundancy and reducing contractors' work], the process for determining required compulsory redundancies within a classification will be through consultation, including taking length of service into account. (Emphasis added.) These provisions specifically deal with the requirement for consultation in a redundancy situation, referring back to the consultation process in cl. 7.

The facts relevant to the alleged breach of the requirement to consult 249 I have previously detailed the facts relevant to the alleged breach of the consultation obligation in the Agreement, and it suffices to summarise the salient facts as follows: (a) the coal industry was experiencing a significant downturn and in April 2014 Mr Green appointed Mr Gorman to conduct the Operational Review which was aimed at finding cost savings. Even before April there had been proposals put forward for the abolition of positions as a cost savings measure; (b) also in April Mr Stewardson developed and circulated a proposal which involved the abolition of seven positions in the Engineering team including Mr Giddings' and Mr Rosewarn's positions; (c) in May Mr Gorman developed a proposal which involved the abolition of seven positions; (d) in May Ms Ragen prepared the "Operational Review - May 2014" report which proposed the abolition of a larger number of positions including Mr Giddings' and Mr Rosewarn's positions and one Administration Assistant position. It envisages that there were potentially available avenues for the redeployment of affected employees; (e) in early June Mr Gorman prepared the "Scenario Planner" spreadsheet which identifies positions for abolition including Mr Giddings, Mr Rosewarn and three Administration Assistant positions. It envisages that the affected employees could be redeployed into vacancies created through offers of voluntary redundancy and by reducing contractors; (f) in May/June Mr Gorman prepared the report titled "Review of the obligations regarding workforce reductions" which tends to show that he understood the Agreement to require that affected employees be redeployed into vacancies created through offers of voluntary redundancy and by reducing contractors; (g) Mr Gorman met with Mr Green about every two weeks throughout April, May, June and July and kept Mr Green up to date with the progress of the Operational Review. On 30 June he provided Mr Green with a revised PKCT organisational chart which proposed the abolition of five engineering positions including Mr Giddings' and Mr Rosewarn's positions and three other positions including two Administration Assistants; (h) shortly after 2 July Mr Gorman produced the first draft OOR Report and he provided that to Mr Green, Mr Stewardson and Ms Ragen by way of a shared link; (i) shortly before 4 July Mr Green was given a revised organisational chart based on the proposal to abolish various positions. (j) on 4 July Mr Green gave a PowerPoint presentation to the Lodge AGM aimed at persuading the assembled employees to accept a wage freeze and a suspension of the regrading of positions. Although he had reviewed the revised organisational chart he did not inform the assembled employees or the Union of the proposal; (k) in July Ms Ragen and Mr Gorman (with input from Mr Stewardson) created the second and third draft OOR Reports which provided for the abolition of Mr Giddings', Mr Rosewarn's and two Administration Assistants' positions. Those draft reports were a comprehensive and essentially complete proposal; (l) the reports show a critical change in PKCT's approach to forced redundancies, providing that PKCT would not offer voluntary redundancies in relation to Mr Giddings' and Mr Rosewarn's positions and would not consider reducing contractors unless the contractors were engaged on a full time and permanent basis (which none were). This had the inevitable effect that Mr Giddings and Mr Rosewarn would not be redeployed and their employment would be terminated, if their positions were abolished as proposed; (m) the change in PKCT's approach to reducing contractors resulted from legal advice obtained by PKCT in July 2014; (n) on 1 August Mr Green met with Mr Gorman, Mr Stewardson and Ms Ragen to discuss the recommendations in the third draft OOR Report. It is likely that Mr Green made the decision to proceed with the proposed abolition of positions at or around that meeting; (o) between 1 August and late November Mr Green met with Mr Gorman, Ms Ragen and Mr Stewardson on five further occasions in relation to the proposed abolition of positions; (p) PKCT did not commence to consult with the Union until the week starting 2 December; (q) in the week from 2 December PKCT met with the Union and exchanged letters in purported compliance with its obligation to consult, as follows: (i) Mr Green provided a broad overview of the proposal at a meeting of all employees at 9:00 am on 2 December, but he did not identify the positions proposed to be abolished; (ii) Mr Green provided broad information to the Union at a meeting at 9:25 am on 2 December, but he did not identify the positions to proposed to be abolished; (iii) PKCT managers informed the affected employees and the Union of the proposal to abolish their particular positions at individual meetings held between 10:45 am and 11:45 am on 2 December; (iv) Mr Green and other managers met with Union representatives at 2:30 pm on 2 December to discuss the proposal. The Union representatives expressed their concerns and requested further information; (v) Mr Tonini met with three potentially affected Administration Assistants (and the Union) at 9:00 am on 4 December; (vi) on 4 December the Union wrote to PKCT setting out its concerns about the proposal and seeking further information; (vii) on 8 December Mr Green wrote to the Union in response; (viii) on 9 December the Union again wrote to PKCT setting out its concerns regarding the proposal; (ix) on 9 December Mr Tonini again met with the Administration Assistants between 2:30 pm and 3:00 pm; and (x) at 9:00 am on 10 December Mr Green and other managers met with Union representatives. At the end of that meeting Mr Green informed the Union representatives that he would consider his position and make a decision by the following day; (r) there was little engagement between the parties during the consultation meetings. In my view PKCT largely just reiterated the position it had previously decided; (s) on 11 December Mr Green advised Mr Giddings and Mr Rosewarn that he had decided to abolish their positions and terminate their employment, effective immediately; and (t) none of the Administration Assistants expressed an interest in voluntary redundancy and on 11 December Ms Arber was made compulsorily redundant following a selection process which took into account various appropriate selection criteria. Mr Tonini advised Ms Arber that her position had been abolished and that her employment was terminated, effective immediately. 250 PKCT denied that it breached cl. 7 of the Agreement and I now turn to consider PKCT's case in that regard.

PKCT's contention that its decisions did not involve a major change and therefore did not require consultation 251 PKCT contended that, on a proper construction, the Agreement did not require it to consult with the Union about the proposed abolition of positions or about the termination of their employment. It argued that it was only required to consult when PKCT was considering a "major change" under cl. 7.1(a) which "if implemented, is likely to have a detrimental or significant effect on employees" under cl. 7.1(b). It argued that because the proposed abolition of positions and termination of employment only involved three of PKCT's 98 employees and related to roles that had only been recently added because of anticipated changes arising from the Upgrade Project and the R&C Project, no consultation was required. 252 PKCT noted that cl. 7.7 provides that the definition of significant change or effect "seeks to illustrate that the changes requiring extensive consultation generally need to have broad impacts and be likely to affect a significant part of the Company's operations or affects [sic] Employees' working arrangements." 253 I do not accept PKCT's contention. In my view it is based in a misconstruction and misapplication of cl. 7. 254 First, it is wrong to consider PKCT's obligation to consult only by reference to its decision to abolish the positions and terminate the employment of three of its 98 employees. PKCT's decision to implement forced redundancies: (a) without first offering voluntary redundancies in an effort to see whether suitable vacancies arose into which the affected employee could be redeployed or "swapped"; and (b) while restricting its consideration of reducing contractors to contractors engaged on a full time and permanent basis (when there were no such contractors); was an important change in the way PKCT approached a reduction in manning levels. 255 Both Mr Gorman and Mr Stewardson accepted that the decision not to offer voluntary redundancies was an important one. The evidence shows that PKCT had never previously imposed forced redundancies and that previous reductions in manning had been achieved by, amongst other things, voluntary redundancies. In my view PKCT's new approach, if implemented, was a major change which operated to reduce the security of employment of employees beyond the three positions immediately affected. It had a broad detrimental and significant effect on the conditions of employment at the terminal. 256 Second, cl. 7 must be construed consistently with its purpose. Clauses 7.2(a) and (b) provide that the purpose of consultation includes to resolve issues and avoid unnecessary problems by identifying and discussing workplace matters of concern, and to improve the level of understanding between management, employees and the Union. It would be inconsistent with this purpose to construe cl. 7 such that PKCT was not required to consult in circumstances where its senior managers concede that the proposal to abolish positions involved important changes to PKCT's approach to the implementation of forced redundancies. 257 Third, the meaning of a "significant change or effect", "major change" and "detrimental or significant effect" in cl. 7.1 must be construed consistently with the Agreement overall. Clause 9 of the Agreement is significant in this regard. It provides: Employment Security 9.1 The parties acknowledge that job security is a mutual obligation. Security of employment is important for improving working relationships, trust and cooperation with change. The parties do not want an environment where everyone is working in fear of losing their employment. The parties want an environment where people focus on doing their jobs safely, well and implementing improvement actions. Real employment security can only be achieved by successful business performance. 9.2 It is not intended that the number of direct, full time employees engaged by the Company under this Agreement at the date that it is approved will be reduced over the life of the Agreement. However, the Company retains the right to make such changes should circumstances arise which, in its opinion, necessitate a change to the numbers of employees per shift or the skills components of teams. In such circumstances the Company will comply with Clause 7 (Workplace Change and Consultation) prior to the implementation of any change to manning levels. 9.3 If a redundancy situation still exists after the consultation process in Clause 7 has been complied with, this will be dealt with in accordance with Clause 13.5 Redundancy. (Emphasis added.) 258 Clauses 9.2 and 9.3 contemplate the possibility of redundancies. Clause 9.2 expressly requires PKCT to consult with the Union in accordance with cl. 7, "prior to the implementation of any change to manning levels". Clause 9.3 provides that it is only when consultation under cl. 7 has occurred that PKCT may proceed to make an employee redundant, which must be done in accordance with cl. 13.5. It is uncontentious that the present case involves a "redundancy situation" under cl. 9.3. The express requirement in cll. 9.2 and 9.3 necessitating compliance with cl. 7 in such a situation indicates that the Agreement should be read so that a decision by PKCT to implement forced redundancies involves a "significant change or effect" under cl. 7.1. 259 Fourth, cl. 9.1 expressly acknowledges the importance the parties ascribed to security of employment in the Agreement. Clause 9.2 shows that PKCT did not intend to reduce the number of its direct full time employees over the life of the Agreement. Clauses 9.5 and 9.7 indicate that employees are not to be made redundant in order to have the employee's work undertaken by a contractor and that PKCT may only engage and use contractors where the job security of employees is not affected. The importance of security of employment confirms that the Agreement should be construed as treating forced redundancies as a matter that requires consultation under cl. 7. 260 Fifth, the context in which the parties entered the Agreement points to the same construction. The evidence shows PKCT had previously achieved necessary reductions in manning by voluntary redundancies and it had never previously sought to reduce its manning levels through forced redundancies. This points to a construction of cl. 7 that treats the imposition of forced redundancies as a "major change" having a "detrimental or significant effect". 261 Sixth, in submissions PKCT accepted that by operation of cll. 9.2 and 9.3 it was obliged to consult when a "redundancy situation" existed, and it is uncontentious that a such a situation existed. Given this, it is difficult to see what turns on PKCT's contention. PKCT's acceptance that cl. 9 required it to consult means there is little substance in its argument about the proper construction of cl. 7.

PKCT's contention that it was only obliged to consult after a "decision" had been made 262 PKCT contended that its obligation to consult pursuant to the Agreement only arose after it had made a "decision" to propose the forced redundancies of Mr Giddings, Mr Rosewarn and Ms Arber. In this regard it relied on cl. 7.4 which provides that "[t]he Company will notify the relevant Employees and their Employee Representatives of the proposed change as soon as a decision has been made." (Emphasis added.) 263 PKCT argued that because cl. 7 refers to notification arising after the making of a "decision", it followed as a matter of logic that any consultation could only occur once the relevant notification had occurred. On PKCT's argument, until Mr Green made the decision to abolish the affected positions it was under no obligation to consult. It argued that the obligation in the present case was to consult about the way in which the decision to abolish positions was to be implemented. 264 I do not accept PKCT's contentions in this regard. Again, in my view they are based upon a misconstruction and misapplication of cl. 7. 265 First, cl. 7.1 requires PKCT to consult with employees and the Union when it is considering introducing a major change which, if implemented, is likely to have a detrimental or significant effect on employees. The use of the word "considering" means that the obligation to consult is enlivened when PKCT is examining or giving consideration to a "major change" which, if implemented, is likely to have a detrimental or significant effect on employees. 266 There is nothing in cl. 7.1 to indicate that the obligation to consult commences not when PKCT is considering a change, but rather when its consideration has concluded by it making a decision. While it may be accepted that an embryonic or relatively unformed proposal might not, at that stage, attract the obligation to consult under the Agreement, those are not the facts before me. 267 Second, PKCT's argument that cl. 7.4 is the only provision in cl. 7 that has a timeframe is misconceived. The matters dealt with in subcll. 7.1 to 7.8 arise sequentially and the clause should be construed in that way. Read sequentially, cl. 7.1 requires PKCT to consult with its employees when it is considering a major change, cl. 7.2 explains the purpose of consultation and provides that it is to occur prior to a final decision, and cl. 7.3 requires PKCT to give prompt and genuine consideration to the matters raised by employees in that consultation. It is only then that cl. 7.4 refers to notification to employees of the proposed change "as soon as a decision has been made". This is a reference to the decision made by PKCT after consultation. It requires no more than that PKCT promptly notify employees of the decision it has made once the consultation is complete. On a proper construction, cl. 7.4 describes when the consultation obligation in the Agreement comes to an end rather than, as PKCT contended, describing when that obligation commences. 268 Third, PKCT's construction is inconsistent with cl. 7's stated purpose. Clause 7.2(a) and (b) provide that the purpose of consultation includes to: (a) "[r]esolve issues, where possible, at the workplace and avoid unnecessary problems by identifying and discussing matters of actual or potential concern…"; and (b) "to improve the level of understanding between management, employees and employee representatives by exchanging relevant information on a timely basis". 269 Clause 7.2(c) provides that the purpose of consultation includes to ensure that employees are aware of a review of their work area that could lead to a significant change or effect on working arrangements, so as to allow employees and the Union to provide input for PKCT's consideration through a process of consultation. The purpose of a timely exchange of information, identification and discussion of matters of concern, and allowing employees and the Union to have "inputs" for PKCT's consideration must include ensuring that there is a genuine opportunity for them to convey views and information to PKCT while it is considering a change, so as to potentially affect the result of that consideration. That is, they must be given a real opportunity to influence the outcome. 270 The purposes stated in cl. 7.1(a) and (b) are incompatible with PKCT's construction which only requires it to consult when it has made the relevant decision, and then only to consult about implementation of that decision. In my view cl. 7 requires PKCT to consult when it is giving substantive consideration to a major change. 271 Fourth, the requirement in cl. 7.2(c) "allowing Employees and Employee representatives inputs to be taken into consideration through a process of consultation, prior to a final decision being taken by management" is significant. It requires PKCT to provide employees an opportunity to present their points of view and/or state their objections for management's consideration before a decision is made. It confirms that the decision by PKCT is something which follows consultation, not something which precedes it. In my view it shows that the obligation to consult is enlivened at a time when there is a genuine opportunity to influence the outcome rather than after the decision is made. 272 Fifth, PKCT's construction is inconsistent with the context in which the parties entered the Agreement. There can be no real question that the consultation obligation in cl. 7 finds its roots in the Termination, Change and Redundancy Case (1984) 294 CAR 175 and the Termination, Change and Redundancy Case (No 2) (1984) 295 CAR 673 ("TCR Cases"). Over time those decisions led to the introduction of termination, change and redundancy clauses ("TCR clauses") in industrial awards and agreements around Australia. In Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v QR Limited (2010) 268 ALR 514 ("CEPU v QR") at [47]-[63] Logan J usefully set out some of the history of the development of TCR clauses. 273 The decisions of the Australian Industrial Relations Commission and its successors ("the Commission") which preceded the Agreement assist in understanding the meaning of "consultation" within such clauses. In CEPU v QR Logan J gathered some decisions in which the Commission discuss the meaning of "consultation": see Construction, Forestry, Mining and Energy Union v Newcastle Wallsend Coal Company Ltd (C2758 Dec 1533/98 S Print R0234) (Full Bench); Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Vodafone Network Pty Ltd (C2001/5770 PR911257) (Cmr Smith); Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Optus Administration Pty Ltd AW791910 Print L4596) (Cmr Smith). 274 I respectfully agree with Logan J's observation in CEPU v QR at [43], that the Commission decisions show that: … A key element of [the content of consultation] 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. (Emphasis added.) 275 Nor has there been any real change in the Commission's approach over the years. Recently in Livingstones Australia v ICF (Australia) Pty Ltd T/A IC Frith & Associates [2014] FWCFB 1276 at [35] the Full Bench of the Fair Work Commission held: Consultation does not mean joint decision making, it does involve a genuine opportunity to persuade (CPSU, the Community and Public Sector Union v Vodafone Network Pty Ltd [PR911257] per Smith C (as he then was); Modern Award Consultation Clause case [2013] FWCFB 10165 at [31] - [32]). The terms of the FW Act demonstrate that the legislature has intended to attach significance to the right to consultation in redundancy situations. 276 The history of the development of TCR clauses, and the Commission decisions which predate the Agreement, show a context in which the obligation to consult under industrial awards and agreements is generally aimed at providing employees an opportunity to have input into proposed major workplace changes. I have little doubt that this is in recognition of the fact that genuine consultation is likely to facilitate proposed changes and because the exchange of views between employers and employees is accepted as good management practice. This context points away from construing the obligation to consult in the Agreement as being limited to the period after PKCT had made the relevant decision and only to questions around the implementation of that decision. 277 Fifth, construing the consultation obligation as arising when management is considering a change rather than when a final decision is made is consistent with the meaning given to consultation in other settings. As Logan J noted in CEPU v QR (at [43]): Thus, in Port Louis Corporation v Attorney-General of Mauritius [1965] AC 1111 at 1124 the Judicial Committee observed of a consultation obligation in an ordinance in respect of measures to alter local government boundaries that: "[t]he nature and object of consultation must be related to the circumstances which call for it" and "The requirement of consultation is never to be treated perfunctorily or as a mere formality. The local authority must know what is proposed; they must be given a reasonably ample and sufficient opportunity to express their views or to point to problems or difficulties; they must be free to say what they think." These observations as to what was entailed in a requirement to consult commended themselves, in the different context of their use in broadcasting legislation, to Toohey J when a judge of this Court in TVW Enterprises Ltd v Duffy (No 2) (1985) 7 FCR 172. His Honour pithily remarked (at 178), "Consultation is no empty term." That same sentiment is evident in the following passage from the judgement of Sachs LJ in Sinfield v London Transport Executive [1970] 1 Ch the at 558 concerning a consultation obligation which attended a power to alter bus routes: It is apposite first to mention that Mr Francis emphasised not once but several times that whatever be the true construction of section 22(3) [which contained the consultation requirement] and whatever order this court might make, it was in the end the executive and no one else who made the decision. If that was intended to intimate that the executive merely looked on consultations as being an opportunity for those consulted to make ineffective representations, it would represent an approach that, to put it mildly, cannot be supported. Consultations can be of very real value in enabling points of view to be put forward which can be met by modifications of a scheme and sometimes even by its withdrawal. I start from the viewpoint that any right to be consulted is something that is indeed valuable and should be implemented by giving those who have the right an opportunity to be heard at a formative stage of proposals - before the mind of the executive becomes unduly fixed. (Emphasis added.)

PKCT's contention that it complied with the consultation obligation on 4 July 2014 278 PKCT contended that it complied with its obligation to consult through Mr Green's presentation to the Lodge AGM on 4 July 2014. This contention has no merit. 279 At the Lodge AGM Mr Green gave a PowerPoint presentation in relation to deteriorating conditions in the coal industry and the need for workplace changes in light of difficult market conditions. His presentation was aimed at convincing the assembled employees that they should agree to vary the Agreement to exempt PKCT from the pending 4.5% pay increase and to freeze the regrading of positions for 12 months. Mr Green did not inform them of the proposed abolition of particular positions. 280 In his 20-page PowerPoint presentation, Mr Green set out the difficult economic conditions that PKCT faced. The only reference to the redundancies occurred late in the presentation, as follows: Our objective is to: • Communicate the needed [sic] • Lower all costs in the business to meet operational needs • Reduce our people costs, while remaining consistent with our values and obligations For people costs, the following are possible outcomes: • People changes to meet the 'what next' if the tonnes reduce • Natural attrition could be applied to the trades and operators classifications • A process of redundancy for specific groups based on classification • Less shift based in workers, returning some people to day work roles • Service offer changes (operating 24 x 5 days/wk) • Appropriate consultation (Emphasis added.) 281 PKCT's contention that this constitutes proper consultation is based on one dot point late in a lengthy presentation about other matters, when Mr Green gave no emphasis to the possibility of forced redundancies and he chose not to refer to the revised organisational chart he had been provided before the AGM. Further, he did not provide the Union with a copy of the PowerPoint presentation before the AGM and he refused to provide Mr Giddings with a copy after it. 282 In any event, it is plain that Mr Green knew that his presentation to the AGM did not inform the Union of the substance of the proposal to abolish positions, or even put it on notice. When he moved to announce the proposal on 2 December he was careful to ensure that nothing was revealed to the Union until the announcement was made. As late as 1 December, on the eve of the announcement, he refused to tell Mr Timbs the substance of the announcement because he said doing so would "compromise the necessity of consultation". 283 This contention did PKCT no credit.

Did PKCT comply with its obligation to consult on or about 1 August 2014? 284 As I have said, on my view of the evidence Mr Green decided on or about 1 August to accept his senior managers' recommendation to abolish the relevant positions, and at the same time he decided that voluntary redundancies would not be offered in relation to Mr Giddings' and Mr Rosewarn's positions and that the investigation of reducing contractors would be restricted to full time and permanent contractors. As I have said, those decisions meant that Mr Giddings and Mr Rosewarn could not be redeployed into other work and it was inevitable that their employment would be terminated (if their positions were abolished as proposed). 285 PKCT did not consult with the Union at any point prior to making those decisions. In fact, it did not commence to consult until four months after the decisions were made. It follows that PKCT failed to comply with the consultation obligation in cl. 7.

Did PKCT comply with its obligation to consult between 1 August 2014 and 2 December 2014? 286 My finding that PKCT did not comply with its obligation to consult in the period from 1 August to 2 December would be the same even if (contrary to my view) Mr Green did not decide to abolish the relevant positions on 1 August and instead merely considered the proposal to abolish positions on that date. 287 I say this because, amongst other things, by 1 August the proposal by PKCT's senior managers to abolish positions was comprehensive and essentially complete, and they had had recommended it to Mr Green, the General Manager. The proposal was sufficiently definite that Mr Gorman said that it could be announced that month, and there was no material change in the proposal from then until 2 December. In relation to Mr Giddings and Mr Rosewarn, if adopted, the proposal would have definite results as it was inevitable that their employment would be terminated. 288 Clause 7 requires PKCT to consult when it is considering a "major change" which "if implemented is likely to have a detrimental or significant effect on employees". On the most favourable view of the evidence for PKCT, when Mr Green discussed the recommendation with his senior managers on 1 August he was considering such a change. PKCT's obligation to consult was enlivened. 289 In fact, it is arguable that PKCT should have consulted with the Union when it was developing the proposal in May, June and July 2014. If it had consulted while it was developing the proposal, the Union would have had a meaningful opportunity to participate in the decision, including by offering alternative ways to achieve the desired cost savings. However, I need not decide that issue. It is enough to decide that the Agreement required PKCT to consult with the Union shortly on or about 1 August and it did not do so. Instead, it did not consult until four months later which was far too late. 290 On Mr Green's evidence, from 1 August until mid-October he was still making up his mind whether to advance the proposal. While I do not accept that evidence, even if I did in my view Mr Green was considering a major change during that period. Clause 7 required PKCT to consult during that period and it did not do so.

Did PKCT comply with its obligation to consult from 2 December 2014? 291 In my view PKCT also breached its obligation to consult during the consultation process from 2 until 10 December 2014. In my view the consultation it provided was too late, not genuine, and it did not provide the necessary information or allow sufficient time for proper consultation to occur.

The consultation was too late 292 PKCT contended that the round of consultation meetings from 2 December showed that it gave prompt and genuine consideration to the matters raised by the Union before Mr Green made a final decision. It argued that the parties' different views about the requirements of consultation led to different views about what information regarding contractors' work was required to be disclosed, and that the Union's position was based on a flawed assumption that the Agreement imposed a requirement to provide all relevant information. It also argued that the view taken by PKCT that certain information concerning contractors was not relevant (and therefore did not need to be provided to the Union) was held in good faith. 293 I do not accept PKCT's contentions. Even if (contrary to my view) Mr Green did not make the relevant decisions on or about 1 August PKCT did not consult in a timely way. As I have said, by 1 August PKCT's senior managers had: (a) identified the positions proposed to be abolished (except perhaps in relation to whether the proposal concerned two or one Administration Assistant positions); (b) identified Mr Giddings, Mr Rosewarn and the three Administration Assistants as employees occupying an affected positions; (c) proposed that offers of voluntary redundancy would not be made in relation to Mr Giddings' and Mr Rosewarn's positions; (d) proposed that PKCT would not consider reducing contractors, unless the contractor was engaged on a full-time and permanent basis (which none were); (e) considered the individual circumstances of each affected employee in a detailed redundancy checklist; and (f) prepared detailed implementation plans, which included a period of consultation, but which culminated in dismissal. The effect of these proposals, if implemented, was that it was inevitable that Mr Giddings and Mr Rosewarn could not be redeployed (if their positions were abolished as proposed). 294 PKCT should have consulted about this proposal at about that time but it did not. By failing to consult with the Union until December 2014, PKCT left the consultation until too late.

The consultation was not genuine 295 PKCT accepted that the parties were talking past each other during the consultation meetings in early December 2014, and it argued that this did not mean that it did not genuinely consult with the Union. It contended that the parties viewed and explained their understanding of the consultation process in fundamentally different ways and that in such circumstances it was hardly surprising that there was not much to discuss between them. 296 While I have no difficulty in accepting that the parties did not really engage with each other in the consultation process from 2 December, I do not accept that PKCT genuinely consulted with the Union. On my view of the evidence PKCT was not prepared to genuinely consider any concerns or alternative propositions put forward by the Union. In part, the reason why the parties were at cross purposes is likely to have been because PKCT's position was fixed by the time consultation commenced. 297 Of course, PKCT was not required to accept the Union's alternative views or suggestions. But the evidence tends to show that PKCT, through Mr Green and his senior managers, had a closed mind and it did not genuinely consult. 298 I say this mainly because Mr Green made the relevant decisions on or about 1 August, four months before consultation began, and those decisions were fixed. They had become entrenched over time. 299 My view that PKCT did not genuinely consult is also informed by the actions of Mr Green and his senior managers before and during the consultation process. Mr Green was in charge and in my view the senior managers' negative approach to consultation is likely to have followed his lead. 300 First, in his 3 June 2014 "PKCT Operational Review summary paper" Mr Gorman said: "Avoid anything that looks like co-determination". In cross-examination he conceded that one of his objectives in the restructuring process was to avoid the appearance that the Union had any real influence on the outcome and anything that looked like the Union was in control. However, the Agreement required PKCT to consult with the Union which necessarily involved considering the Union's views. In my view Mr Gorman had no real intention of properly consulting with the Union in relation to the proposal to abolish positions. 301 Second, Mr Stewardson was similarly negative about consultation with the Union. As I have said, he wrote the report which said that the consultation process allowed by the Agreement would not allow the necessary workplace changes (as he saw them) to be expeditiously made. He exhorted PKCT to take a "just do it" approach to necessary workplace changes. In my opinion he was not prepared to consider any alternative views put forward by the Union. 302 Third, on 3 December 2014 (only one day after the announcement of the proposal) Ms Linton prepared a lengthy and detailed rebuttal not only of the concerns that the Union had raised at the initial consultation meeting, but of every argument she anticipated might be raised. She prepared and circulated this rebuttal to, amongst others, Mr Green, Mr Gorman and Mr Stewardson before the Union had been provided any proper opportunity to put its position. Mr Gorman accepted that all he was doing was justifying the company's position that voluntary redundancies would not be utilised, rather than considering alternatives. Mr Green used these rebuttal arguments in subsequent consultation meetings and to an extent in PKCT's letter to the Union on 8 December. 303 Fourth, the Union wrote to PKCT on 4 December 2014 seeking further information and requesting that PKCT offer voluntary redundancies to all persons holding Daywork Appointed positions, consider reducing contractors for redeployment purposes, and to investigate all avenues to avoid forced redundancies. The Union sought a meeting with PKCT to discuss those avenues. 304 On 5 December Mr Gorman, Ms Linton and Mr Stewardson spent much of the day drafting PKCT's response. Again, in cross-examination Mr Gorman conceded that in drafting the response he was merely seeking to justify the company's position in the best way he could rather than considering alternatives. Mr Green's letter of 8 December just restated the position PKCT had taken since 1 August 2014 and contained some of the rebuttal arguments which Mr Gorman and others had worked on. 305 Fifth, Mr Green refused to provide any substantive information about contractors or the work they undertook even though it would have assisted genuine consultation. 306 Sixth, Mr Green sought to rely on a calculation he requested which showed that three long serving employees taking up voluntary redundancy would cost PKCT about $100,000 more than the forced redundancies of Mr Giddings, Mr Rosewarn and one Administration Assistant. However, that comparative calculation was skewed because: (a) Ms Arber had less than 10 years' service; (b) the three long serving employees used as a comparator did not include an Administration Assistant, and their total severance cost could be expected to be higher because of the higher salary component; and (c) the comparator assumed that PKCT would have allowed three of its longest serving employees to accept voluntary redundancies even though it was a matter for it to select the employees to whom it made offers. There would have been no obligation upon it to select the longest serving employees from any employees who expressed an interest in voluntary redundancy. It must have been apparent to Mr Green that the calculation was of limited value and his reliance on it points to a determination to justify his position rather than genuinely consider alternative views. 307 Seventh, Mr Green was not frank in his evidence that he did not make a final decision to abolish Mr Giddings' and Mr Rosewarn's positions or to terminate their employment until after the final consultation meeting on 10 December 2014. It is uncontentious that at that meeting he told the Union representatives that he would "see that a decision will be made by tomorrow". Mr Timbs replied (accurately as it turned out): "I think you have made a decision already and these are just steps being taken." 308 In cross-examination, confronted with evidence that he had assisted in drafting termination letters to the affected employees, Mr Green conceded that he had already made the decision to terminate the employment of the affected employees and that there was no possibility that he would alter or reverse it. In my view, on his own account he was only pretending to consult during that meeting, and when he said to Mr Timbs and the Union representatives that he would see that a decision would be made the following day he was not telling the truth. 309 Eighth, some parts of the consultation process had the appearance of being stage-managed to give an impression that a final decision had not already been made when it had. For example: (a) the final draft OOR Report of 16 October 2014 informed those senior managers who were to consult with affected employees that: For consultation to be genuine, no steps should be taken which would indicate that a final decision has been made at this stage. (Emphasis added.) (b) Mr Gorman's email of 9 December to Mr Green and other managers reveals a close understanding of the significance as to when PKCT made a decision. His repeated use of inverted commas around the word 'decision' tends to show that there were no real decisions left to be made.

PKCT did not provide the necessary information 310 It is axiomatic that for genuine consultation to occur between an employer considering the introduction of a major change and its employees, the employer must provide sufficient information to enable the employees to understand the proposal and its rationale. This is recognised in cl. 7.2(c) of the Agreement and PKCT accepted that consultation pursuant to the Agreement required the sharing of relevant information on a timely basis. In my opinion PKCT did not comply with this obligation. 311 By its letter of 4 December the Union requested that PKCT provide information regarding the work undertaken by contractors and indicated that it needed to receive such information before it could meaningfully participate in consultation. In item 1 of the schedule the Union sought a list of all positions (both occupied and vacant) on the Upgrade Project, including the skills and qualifications required for each position. In PKCT's response of 8 December 2014 Mr Green said that it was not necessary for PKCT to provide this information. 312 In item 6 of the schedule the Union sought details of all work currently being performed by contractors, including details of the skills and competencies required and the nature of the work. PKCT refused to provide this information and its letter in response, under Mr Green's hand, stated: There are a number of contractors engaged by PKCT who perform sporadic or part-time functions. There are no contractors engaged by PKCT who perform full-time functions that could be considered full-time and permanent. The nature of this work is therefore not relevant to the employment of full-time employees of PKCT. 313 Counsel for PKCT tried to downplay the significance of this refusal to provide information by arguing that the Union had a good understanding of the work undertaken by contractors. However, I accept the thrust of the evidence of Mr Giddings and Mr Timbs that the Union did not have a sufficiently detailed knowledge of the range of work, the hours worked, the nature of the contractual arrangements, or the skills and competencies of the contractors for it to properly engage in consultation about which contractors' work, if any, was suitable to be undertaken by potentially affected employees. 314 PKCT's refusal to provide this information tends to show that it was not interested in genuine consultation about reducing contractors.

PKCT did not provide sufficient time for proper consultation 315 PKCT contended that it provided sufficient time for proper consultation, and noted that the consultation process included three face to face meetings and three letters over a period of nine days. It noted that the Union did not ask for additional time to consult and argued that, because the parties took diametrically opposed positions on the construction of PKCT's obligations under the Agreement, the discussion between the parties had been exhausted by 10 December. 316 I do not agree. In my view PKCT did not provide the Union with sufficient time to properly consider the proposed changes or to allow genuine consultation to occur. 317 There is little substance to PKCT's point that the Union did not request additional time to consult. The Union sought information from PKCT about contractors' work before it could meaningfully participate in consultation and PKCT refused to provide it. There would not have been much to gain by requesting additional time. Also, while it may be that the discussions between the parties were exhausted by 10 December 2014, that appears to have largely been due to PKCT's entrenched position and its refusal to consider alternative views. 318 Mr Green's decisions were in part based upon a new construction of the Agreement. For the Union to meaningfully participate in consultation it needed time to understand that and to obtain legal advice on the correctness of that construction. It also needed time to obtain a better understanding of the amount and nature of contractors' work across the terminal including whether it was full-time or part-time. Then it needed time to compare the skills and competencies of Mr Giddings, Mr Rosewarn and Ms Arber with the skills and competencies required to undertake any contractors' work which appeared to be suitable. I note in passing that the second and third draft OOR Reports provided for about three weeks of consultation. 319 It is noteworthy that it took Mr Gorman and Ms Ragen two to three months to develop the proposal to abolish positions. On Mr Green's account he then considered the proposal from 1 August until mid-October 2014, including in further meetings with the senior managers. Yet PKCT gave the Union no advance warning of the proposal and from 2 December it allowed only eight working days for consultation with the Union. In all the circumstances that was plainly inadequate.

The ALLEGED failure to comply with the redundancy provisions

The terms of the Agreement 320 Clause 13.5 of the Enterprise Agreement provides: 13.5 Redundancy 13.5.1 The Company undertakes that in managing manning levels to suit the business needs it will make use of redeployment and voluntary redundancy prior to implementing any forced redundancies. 13.5.2 If workforce reductions for Employees bound by this Agreement were to become necessary, they will be undertaken through the consultative process described in this Agreement. 13.5.3 The Company shall investigate all avenues to avoid forced redundancies, including the reduction of contractors, where the work performed by contractors can be performed by Employees of the Company, having regard to the skills and competencies of Employees and the nature of the work in question. 13.5.4 If a redundancy situation still exists after the above steps have been taken, the process for determining required compulsory redundancies within a classification will be through consultation, including taking length of service into account. 13.5.5 Should the need for redundancy arise, the PKCT standard severance package of four weeks pay in lieu of notice and three weeks pay per each year of service paid at the Special Purpose Rate shall apply, unless otherwise agreed or determined. 321 Clause 13.5 provides: 9. Employment Security 9.1 The parties acknowledge that job security is a mutual obligation. Security of employment is important for improving working relationships, trust and cooperation with change. The parties do not want an environment where everyone is working in fear of losing their employment. The parties want an environment where people focus on doing their jobs safely, well and implementing improvement actions. Real employment security can only be achieved by successful business performance. 9.2. It is not intended that the number of direct, full time employees engaged by the Company under this Agreement at the date that it is approved will be reduced over the life of the Agreement. However, the Company retains the right to make such changes should circumstances arise which, in its opinion, necessitate a change to the numbers of employees per shift or the skills components of teams. In such circumstances the Company will comply with Clause 7 (Workplace Change and Consultation) prior to the implementation of any change to manning levels. 9.3. If a redundancy situation still exists after the consultation process in Clause 7 has been complied with, this will be dealt with in accordance with Clause 13.5 Redundancy. 9.4. Where an Employee has appropriate skills and qualifications, it is the Company's intention to provide Employees with opportunities for involvement in the "PKCT Upgrade Project". 9.5. The Company will not terminate the employment of Employees on the ground of redundancy, or not replace Employees who resign or retire, in order to: a. replace the Employee with a contractor; or b. have the job of the Employee performed by a contractor. 9.6. The commitments above do not prevent the Company from using natural attrition or a process of redundancy to reduce the size of its workforce, nor does it require the Company to replace any Employee who retires or resigns. 9.7. The Company is entitled to engage and use contractors, provided that the job security of Employees is not affected, consistent with the terms of this clause. 9.8. When engaging contractors whose employees perform work within the scope of this Agreement, the contractor will be required to pay their employees the more beneficial of: a. The Special Purpose Rate for the minimum grade level of equivalent or comparable Employees engaged under this Agreement (Grade 1 for Operators and Grade 3 for Trades) together with the payment of overtime in accordance with Clause 15.3.2 and Meal Allowance in accordance with Clause 15.6; or b. The ordinary time earnings contained in an Enterprise Agreement made under the Fair Work Act 2009 and binding the contractor and his or her employees. (Emphasis added.)

PKCT's case regarding the alleged breach of cl. 13.5

The evidence regarding the decision not to offer voluntary redundancies 322 In his affidavit Mr Green said that he was aware that the Agreement provided that, when PKCT is managing manning levels to suit its business needs, it is required to use voluntary redundancies before implementing forced redundancies. He said that within that context he considered whether voluntary redundancies were appropriate so as to avoid the need for forced redundancies in relation to the three affected positions. 323 In relation to the Administration Assistant position, he said that each assistant performed the same role and it was therefore possible when reducing the number of positions by one, to ask for expressions of interest in voluntary redundancy within that classification before implementing any forced redundancies. 324 However he said the situation was different in relation to Daywork Appointed positions such as the Long Term Planner and Facilities Maintenance Engineer roles in which Mr Giddings and Mr Rosewarn were employed. In his view the specialised skill-sets of those positions meant that they "stood alone" in relation to redundancy rather than being in a "pool" like the Administration Assistants. He said that the other Appointed positions included maintenance planning roles, technical officer roles, project officer roles and electrical and process control roles and that taking into account the position descriptions of those roles, the skill sets were sufficiently distinct that employees could not merely be "swapped" between roles without a substantial gap in skills and experience which could not be bridged by reasonable training. 325 He also said that offering voluntary redundancies in relation to the abolition of Daywork Appointed positions would be disruptive and inefficient because PKCT would have no control over which employees ceased to be employed. On this argument, offers of voluntary redundancy were likely to lead to employees leaving who had the required skill sets and in whom PKCT had invested time and money in training, and the retention of employees who had been "swapped" into positions but who did not have optimum skill sets to perform that work. 326 Finally, Mr Green said that he was concerned that allowing other employees to leave PKCT by way of voluntary redundancy, and "swapping" the affected employees into their positions, was not a genuine redundancy. He said that the Union's construction of cl. 13.5 imposed an obligation on PKCT to transfer an employee whose role was not redundant into a position which was redundant solely for the purpose of giving that employee an entitlement to a redundancy benefit, irrespective of whether that employee's position was in fact redundant. He argued that this construed the Agreement as requiring PKCT to breach its taxation obligations.

The evidence regarding the decision to restrict the consideration of reducing contractors 327 In his affidavit Mr Green said that he was aware that the Agreement obliged PKCT to investigate all avenues to avoid forced redundancies including by the reduction of contractors, where the contractors' work could be performed by PKCT employees having regard to the skills and competencies of the employees and the nature of the work in question. 328 Mr Green said that he was informed by Mr Gorman and Mr Stewardson that they had investigated PKCT's need for contractors to determine whether any contractor's work could be performed by Mr Giddings, Mr Rosewarn or Ms Arber, having regard to their skills and competencies and the nature and duration of the contractor's work. He said that Mr Gorman and Mr Stewardson informed him that they had undertaken an examination of the work undertaken by contractors which was similar to work undertaken in the Long Term Planner role or which could be performed by a person who had performed that role, and that the only contractors' work they identified was part-time work, single days or work of a finite duration. He disagreed with Mr Giddings' evidence that he could have been redeployed into contractors' work on the R&C Project, as Mr Green did not accept that work which was fixed term in nature and dependent on funding was suitable to be performed by an employee. 329 In relation to Mr Rosewarn he said that the Union had raised that he could have replaced one of the contracting plumbers used on site, but he disagreed with this. Mr Green said that, while PKCT had three contract plumbers on site and Mr Rosewarn had previously worked as a plumber, plumbers worked sporadically and the work was therefore unsuitable. He also said that work was unsuitable for Mr Rosewarn as he had not worked as a plumber for in excess of 10 years. 330 The thrust of Mr Green's evidence was that he gave consideration to whether any contractors' work could be performed by the affected employees, but the nature of the contractor roles - that they involved performing work on a variable basis, undertook specialist work and were of finite duration - meant that it was not appropriate or reasonable to redeploy them into that work. He said that based on the information he was provided he was satisfied that there was no work undertaken by contractors that could be considered full-time and permanent or into which it was practical to place them.

PKCT's construction of cl. 13.5 331 PKCT sought to characterise cl. 13.5.1 of the Agreement as involving a "general expectation", although it did not develop that argument. It contended the clause should be construed such that, at a point in time prior to imposing forced redundancy on an employee whose position was no longer required, PKCT could redeploy the affected employee into a vacant position if one exists. If there was a vacant position to which the employee can be redeployed (prior to the implementation of the forced redundancy) the forced redundancy will be avoided. It argued that the Agreement did not require it to "manufacture" a vacant position for the purposes of redeployment by seeking expressions of interest in voluntary redundancy in an attempt to see whether a vacancy was created into which the affected employee might be redeployed. 332 It contended that the reference to voluntary redundancy in cl. 13.5.1 is not a reference to, what it described as a "job swap" scheme, but to a process by which the "forced" nature of a redundancy can be avoided by the person affected accepting voluntary redundancy. It argued that the clause contemplates that where the redundant position is a generic position occupied by a number of people (such as the Administration Assistants) and only some of those generic positions are identified for redundancy, the forced redundancy of those persons can be avoided if the requisite number of abolished positions are met by an equal number of employees accepting voluntary redundancy. That step would resolve the "redundancy situation" for the purposes of cl. 13.5.4. 333 It maintained that the obligation in cl. 13.5.3 is to investigate all avenues to avoid forced redundancies rather than to take all avenues. It also asserted that the requirement to "investigate all avenues to avoid forced redundancies including the reduction of contractors" in cl. 13.5.3 is to occur at a point in time after the exhaustion of cl. 13.5.1, as cl. 13.5.3 presupposes that forced redundancies are otherwise required. 334 PKCT argued that any investigation of avenues to avoid forced redundancies required by cl. 13.5.3 involved a consideration of whether the work performed by contractors could be performed by employees of PKCT in their capacity as full time ongoing permanent employees under the Agreement. It argued that the Agreement did not require it to investigate every contractor role at the terminal or all work undertaken by all contractors at the terminal, and the required investigation was limited to contractors' work which was full time and permanent. 335 PKCT submitted that Mr Green's evidence showed that PKCT gave proper consideration to whether any contractors' work could be performed by Mr Giddings, Mr Rosewarn and Ms Arber but that the nature of the contractors' work - namely that contractors performed specialist work, work on a variable basis (including part-time) and work of a finite duration - meant that it was not appropriate or reasonable for PKCT to redeploy them into that work.

Consideration regarding the alleged breach of clause 13.5 336 I do not accept PKCT's contentions which, in my view, misconstrue and misapply cl. 13.5. I consider PKCT failed to comply with cl. 13.5.

PKCT's refusal offer voluntary redundancies 337 It is convenient to start with PKCT's failure to seek expressions of interest in voluntary redundancy in relation to Mr Giddings' and Mr Rosewarn's positions. 338 First, it must be said that there is no real difficulty in construing the meaning of cl. 13.5.1 in this regard. The task of construing the clause begins with a consideration of its text, having regard to context and purpose, as the language employed in the text is the surest guide to its intent: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at [47] (Hayne, Heydon, Crennan and Kiefel JJ). 339 The literal meaning of the clause is unambiguous. I can see nothing in the clause, its context, purpose or the consequences of a literal or grammatical construction, or having regard to the context in which the Agreement was made which indicates that the clause should be read in a way that does not correspond with its literal meaning: see Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355. 340 It is worth going back to the text of cl. 13.5.1, which provides: The Company undertakes that in managing manning levels to suit the business needs it will make use of redeployment and voluntary redundancy prior to implementing any forced redundancies. The clause requires PKCT, in managing manning levels to suit its business needs, to make use of redeployment and voluntary redundancy before imposing forced redundancy upon any affected employee. By use of the word "any" the clause does not contemplate exceptions from this requirement. 341 There is no real question that PKCT made Mr Giddings, Mr Rosewarn and Ms Arber compulsorily redundant in order to reduce "manning levels…to suit [its] business needs". The thrust of the evidence of each of Mr Green, Mr Gorman and Mr Stewardson was that they advanced the proposal to abolish the positions because of the need to find cost savings due to the deteriorating conditions in the coal industry. 342 In so "managing manning levels" PKCT was obliged to: (a) seek expressions of interest in voluntary redundancy from either: (i) all employees; or (ii) that subset of employees as might reasonably take part in a process of voluntary redundancy. There is no requirement for PKCT to seek expressions of interest from persons who are employed in positions that an affected employee could not fill because he or she does not have suitable skills and competencies to properly perform that role; (b) consider the expressions of interest received and decide whether any of the affected employees had suitable skills and competencies to properly perform the work in the role of any employee who expressed interest; and (c) if one or other of the affected employees had suitable skills and competencies to do so, it was obliged to select persons for voluntary redundancy from those who had expressed an interest, and place one or other of the affected employees into that position. 343 Contrary to this requirement PKCT did not offer voluntary redundancies in relation to Mr Giddings' and Mr Rosewarn's positions. In taking this course PKCT failed to comply with cl. 13.5. 344 Second, there is nothing in cl. 13.5.1 to support PKCT's contention that the Agreement only requires it to make use of redeployment and voluntary redundancy when, in PKCT's opinion, it was operationally efficient or reasonable that it do so. Clause 13.5.3 requires PKCT to "investigate all avenues to avoid forced redundancies, including the reduction of contractors" (emphasis added). Clause 13.5.1 recognises voluntary redundancy as one such avenue. The obligation to investigate all avenues to avoid forced redundancies strongly points away from construing the obligation as limited only to avenues which are operationally efficient or reasonable in PKCT's opinion. 345 PKCT's construction of the clause requires additional words to be read into it so that PKCT undertakes that: "in managing manning levels to suit the business needs where it is operationally efficient or reasonable to do so it will make use of redeployment and voluntary redundancy prior to implementing any forced redundancies". The circumstances in which words are to be read into an agreement are quite limited (see for example Fitzgerald v Masters (1956) 95 CLR 420 at 426-427 (Dixon CJ and Fullagar J)) and they are not present in this case. 346 Third, the Agreement must be construed in the context in which the parties entered into it. The evidence shows that PKCT had previously used voluntary redundancies to achieve reductions in manning levels and it had had never previously imposed forced redundancies. Construed in this context, cll. 13.5.1 and 13.5.3 indicate that forced redundancies are only to be imposed after the possibility of redeployment into vacancies created through offers of voluntary redundancy is explored. In broad terms, forced redundancy is to be a last resort. 347 This construction is consistent with the importance the parties gave to security of employment in cl. 9.1. It provides that "security of employment is important for improving working relationships, trust and cooperation with change". Construing the Agreement as allowing PKCT to make Mr Giddings and Mr Rosewarn compulsorily redundant without first seeking expressions of interest in voluntary redundancy to see whether suitable vacancies might arise is inconsistent with the importance the parties gave to security of employment. 348 Fourth, there is no substance behind PKCT's contention that its obligation under cl. 13.5.3 it was limited to a requirement to investigate all avenues to avoid forced redundancies rather than to take such avenues. The obligation to investigate all avenues to avoid forced redundancies must be read consistently with cl. 13.5.1 which, in terms, requires PKCT to make use of voluntary redundancy before implementing forced redundancies. It did not do so. Further, the obligation to investigate all avenues requires PKCT to undertake a bona fide investigation of all options, which must include voluntary redundancies. On my view of the evidence it failed to do so in relation to Mr Giddings' and Mr Rosewarn's positions. 349 Fifth, I do not accept PKCT's contention (or Mr Green's evidence) that a process of seeking expressions of interest in voluntary redundancy from a broad range of employees is necessarily operationally inefficient. In my view the process of seeking expressions of interest in voluntary redundancy from a broad range of employees could have been undertaken quickly and inexpensively. That having occurred, if no expressions of interest were received, PKCT would have satisfied that part of its obligations to make use of voluntary redundancy before implementing forced redundancies (under cl. 13.5.1) and to investigate all avenues to avoid forced redundancies (under cl. 13.5.3). If some employees did express interest then PKCT was required to assess whether Mr Giddings and/or Mr Rosewarn had the skills and competencies necessary to undertake that work before they could be placed into that potentially vacant position. That process too could have been speedily and inexpensively undertaken. 350 It should have been straightforward for PKCT to assess whether Mr Giddings and Mr Rosewarn had suitable skills and competencies, or could achieve them with reasonable on the job training. Contrary to Mr Green's suggestion, the Agreement did not require PKCT to place them into work if they did not have suitable skills and competencies or could not speedily acquire them. 351 In my view Mr Green and Mr Gorman overstated the operational inefficiencies associated with voluntary redundancies. For example: (a) Mr Gorman attempted to justify his recommendation not to offer voluntary redundancies in relation to Mr Giddings' and Mr Rosewarn's positions on the basis that this was the most cost-effective path. However, in cross-examination he admitted that he could not have known at that time whether it would be more cost-effective or not because that depended on which employees expressed an interest in voluntary redundancy; (b) Mr Green said that employees who were closest to retirement age were most likely to take up any offer of voluntary redundancy, but it was up to PKCT to decide who was selected from those who expressed interest. There was no obligation upon it to select the longest serving employees and good reasons for it not to do so; and (c) Mr Green said that the severance cost if voluntary redundancies were offered would be about $100,000 higher than the severance cost of the forced redundancies of the affected employees. However, that calculation was skewed and he could not have known whether it would be more cost-effective or not. 352 It must also be said that even if PKCT could establish some operational inefficiencies arising from the requirement to offer voluntary redundancies, it does not follow that the Agreement allowed it to implement forced redundancies without first offering voluntary redundancies. Clause 13.5 shows that the cost to PKCT of a voluntary redundancy process, before implementation of forced redundancies, was part of the industrial bargain embodied in the Agreement. 353 Sixth, Mr Green's asserted concern about the legality of the Union's approach to voluntary redundancy was little more than an artifice to bolster PKCT's case. PKCT put forward no substantive legal argument as to how the use of voluntary redundancy in the way proposed might constitute a breach of its taxation obligations, and I offer no view as to whether it would or not. However, I note that using voluntary redundancy in this way is widespread in businesses around Australia and PKCT offered voluntary redundancies and job swaps when it previously reduced manning levels. I trust that it did not consider such arrangements to be a breach of its taxation obligations at that time. 354 Seventh, Mr Green sought to justify his decision on the basis that the affected employees did not have suitable skills and competencies to perform other positions within PKCT. However there is no cogent evidence that PKCT gave proper consideration to comparing their skills and competencies against those required in other positions. 355 Mr Stewardson said that Ms Uren prepared a matrix of positions at PKCT against an analysis of the skill set of the employees whose positions were to be abolished. However, he admitted that he had not seen this matrix, PKCT did not adduce it into evidence, and Ms Uren was not called. PKCT did not adduce any document to show that it had undertaken a proper comparative assessment of Mr Giddings' or Mr Rosewarn's skills and competencies against the skills required for other positions within PKCT, and I infer that no proper assessment was ever undertaken. 356 Mr Green said that he did not prepare any document that compared Mr Giddings' and Mr Rosewarn's skills and competencies to those required by the other positions at the site and he said that he based his assessment on his familiarity and knowledge of each employee's respective skills and qualifications. He said that he obtained this familiarity as a result of interacting with these employees on site. He admitted, however, that he "did not get into detailed assessment", "did not do a detailed analysis" and that he "didn't do that extensive detailed review of like-for-like". In my view the evidence shows that Mr Green did not have a proper understanding of Mr Giddings' and Mr Rosewarn's skills and competencies compared to the requirements in other positions. 357 None of Mr Green, Mr Gorman or Mr Stewardson even spoke to Mr Giddings or Mr Rosewarn to ask their assessment of their capacity to properly fulfil other positions, or the types of positions they would be willing to undertake if such positions became vacant. Nor did Mr Green identify the substantial skills gap which he asserted would exist if Mr Giddings or Mr Rosewarn were redeployed into other Daywork Appointed positions. 358 In fact, it is unsurprising that nobody undertook a proper comparative assessment of Mr Giddings' and Mr Rosewarn's skills and competencies in the period from August through to December 2014. Given that Mr Green had decided in August 2014 that PKCT would not offer voluntary redundancies in relation to their positions, it is likely that he and his senior managers thought it unnecessary to do that work. 359 Eighth, it is clear on the evidence that Mr Giddings and Mr Rosewarn had suitable skills and competencies to properly perform a number of positions within PKCT. 360 Mr Giddings had worked at the terminal since 1980, doing so in the following positions: Fitter and Turner Special Class for seven years, Mechanical Tradesperson for 10 years, Relief Supervisor for three years, Maintenance Planner for six years, Maintenance Scheduler for seven years and Long Term Planner for one and a half years. Throughout the 34 years of his employment at the terminal he had enjoyed steady upward progression in seniority of positions. 361 Over the course of his employment he obtained the following qualifications: Trade Certificate in Fitting and Turning in 1983, Certificate IV in Leadership in 1987, Diploma of Management and Leadership with Distinction in 1998, Certificate IV in Business (Frontline Management) in 2006, Certificate IV in Project Management in 2007, Graduate Certificate in Management (Professional Practice) at Charles Sturt University in 2007, Graduate Diploma in Management (Professional Practice) with Distinction in 2008 and Masters of Business (General Management) in 2010. 362 There can be no question that Mr Giddings was experienced in various roles at the terminal and highly qualified. I infer from his further education and his steady upward progression into senior operational roles that he was hard-working, competent and good at learning new skills. 363 In cross-examination, Mr Green was unable to identify any cogent reason why Mr Giddings did not have suitable skills to work in the Inbound Planner, Outbound Planner or Site Services Planner positions (collectively "Area Planners"). Mr Giddings had performed the bulk of the duties of the Area Planner roles for six years between 2000 and 2006 and had continued to work as the Maintenance Planner from 2006 to 2013. Mr Giddings' core responsibilities as Long Term Planner included mentoring and coaching the Area Planners and providing periodic relief in those positions. With respect to his evidence that Mr Giddings did not have suitable skills to be placed into Technical Officer positions, Mr Green conceded that he did not attempt any comparison of the skills and qualifications that the incumbents had compared to Mr Giddings. In the finish, when pressed, Mr Green just reverted to the proposition that PKCT was not obliged to offer voluntary redundancies in relation to Daywork Appointed positions. 364 Mr Giddings said, and I accept, that he has the skills and competencies: (a) to immediately perform the work required in the positions of Inbound Planner, Outbound Planner, Site Services Planner, Mechanical Technical Officer and Projects Officer (which are Daywork Appointed positions). He was not challenged on this evidence; (b) to perform the work required in the positions of Operations Planner and Integrated Operations Planner (which are Daywork Appointed positions) with limited on the job training; (c) to perform the work required in the positions of Team Coordinator and Backup Coordinator (which are Shift Appointed positions); and (d) to perform the work required in the position of Fitter. While he had not worked as a Fitter for many years, I have little doubt that he could speedily reacquaint himself with the requirements of that position if it became necessary. Mr Giddings said, and I accept, that if a voluntary redundancy process was undertaken he was prepared to consider being placed into a position which might result in a reduction in his grading and salary. 365 Mr Rosewarn had worked at the terminal since 1987 in the positions of Licenced Plumber/Drainer/Gas Fitter. Over his 27 years of employment he enjoyed steady upward progression into more senior positions with PKCT including into the positions of Building Services Engineer and Facilities Maintenance Engineer. 366 Over the course of his employment he obtained the following qualifications: Associate Diploma in Engineering (Plumbing Services) from Bankstown TAFE (1993), Graduate Certificate in Design Science (Facilities Management) from Sydney University (2004), Master of Design Science (Building Services) from Sydney University (2005), TAFE Certificate IV in Frontline Supervision (2005), BHP Billiton PM201 Project Management Plus (2006), TAFE Certificate IV in Project Management (2007), Master of Design Service (Facilities Management) from Sydney University (2008) and BHP Billiton PM102 Project Management (2012). While studying at Sydney University he was the top student in the Building Services program, he was on the Dean's Honours List for three years and he was awarded the Dean's List of Excellence in Academic Performance. In 2004 he was approached to rewrite the syllabus for the Hydraulic Services course for the Building Services stream at the University and he was then the course coordinator for three years. He lectured at Sydney University in Operational Facilities Management for two years. 367 He described himself as a "jack of all trades", having initially worked as a Plumber and later working in day-to-day planning, long term planning and budgeting. He said that he obtained extensive project management experience with PKCT across a diverse selection of trades including plumbing, electrical, civil trades and engineering. He was commended by Mr Green for his work on the Recycled Water Project in 2008. 368 There can be no question that Mr Rosewarn was experienced in various roles at the terminal and highly qualified. I infer from his further education and steady upward progression into senior operational roles that he too was hard-working, competent and good at learning new skills. 369 Mr Rosewarn said that his experience coupled with his education and training meant that there would not be many roles at the terminal that he was not capable of undertaking if he was given the opportunity. I accept his evidence in this regard. He said, and I accept, that he had the skills and competencies: (a) to immediately perform the work required in the positions of Site Services Planner, Inbound Planner and Outbound Planner; (b) to immediately perform the work required in the positions of Project Officer, Operations Planner and Integrated Operations Planner; and (c) to immediately perform the work required in the position of Plumber/Gas Fitter. He rejected the suggestion that because he had not worked as a Plumber for some years he could not undertake that role. I accept his evidence that he had kept abreast of developments in his former trade and that he had occasionally worked with contract plumbers at the terminal to assist them in more intricate plumbing work. Mr Rosewarn said, and I accept, that if positions became vacant through voluntary redundancy he was prepared to look at taking on lower positions than the position he held and to look at doing so even if he was to be paid less. 370 Mr Green's evidence that Mr Giddings and Mr Rosewarn did not have suitable skills and competencies for them to be placed into any other positions with reasonable training did him no credit. His evidence was far-fetched given Mr Giddings' history of performing Area Planner work, the diverse work experience both employees had, their competence, their obvious ability to learn new skills, and the fact that nobody made a proper assessment of their skills and competencies in relation to other positions. 371 In my view by not undertaking a proper comparative assessment of the skills and competencies of Mr Giddings and Mr Rosewarn, and by failing to seek expressions of interest in voluntary redundancy in relation to their positions, PKCT breached its obligations to make use of redeployment and voluntary redundancy prior to implementing any forced redundancies, and to investigate all avenues to avoid their forced redundancies. 372 Mr Giddings also said, and I accept, that the positions of Team Coordinator and Backup Coordinator at PKCT were advertised as vacant on 26 September 2014 and those vacancies were filled on 3 November 2014. This tends to show that after the decision to abolish Mr Giddings' and Mr Rosewarn's positions was made in August 2014, but before it was announced, there were two vacant positions into which they could have been redeployed. By the time the proposal was announced the vacant roles had been filled. In taking this approach PKCT again failed to explore all avenues to avoid forced redundancies and it failed to comply with cl. 13.5.

Ms Arber's position 373 In relation to Ms Arber, I consider PKCT made insufficient effort to assess whether she had skills and competencies outside of secretarial/personal assistant work. Again, nobody spoke to her to ask what her relevant skills and competencies were, or whether she thought she could properly fulfil other positions with reasonable training. 374 However, I do not consider that PKCT breached cl. 13.5 in relation to Ms Arber. I consider that PKCT complied with the Agreement by seeking expressions of interest in voluntary redundancy from only the three Administration Assistants. 375 First, I say this because the evidence shows that her work experience is in general administrative tasks, most recently accounts payable. Because of its administrative nature there are many fewer positions of this type at the terminal compared to the operational positions that Mr Giddings and Mr Rosewarn are capable of fulfilling. Based on Mr Tonini's evidence, I am not satisfied that, at the material time, there were any other suitable administrative positions within PKCT into which she could have been redeployed. 376 Second, Ms Arber argued that although she did not have the technical skills to become a specialist mechanical planner she would have been able to be trained and redeployed as an Inbound Planner. I do not accept this. I prefer Mr Tonini's evidence that the Inbound Planner position requires a diverse skill set that is not in any way aligned with Ms Arber's former work, including some knowledge of transport logistics and some experience in operational matters. I accept his evidence that Ms Arber could only perform the Inbound Planner role if she successfully undertook a significant level of training. There is no requirement for PKCT to seek expressions of interest from persons who are employed in positions that an affected employee could not fill because he or she does not have suitable skills and competencies to properly perform that role.

PKCT's refusal to investigate reducing contractors (save for contractors engaged on a full time and permanent basis) 377 I now turn to consider PKCT's refusal to investigate reducing contractors unless the contractors were engaged on a full time and permanent basis (which none were). 378 First, there is little substance behind PKCT's contention that its obligation under cl. 13.5.3 was limited to a requirement to investigate all avenues to avoid forced redundancies rather than take such avenues, and that it was therefore not in breach of the clause. I say this because the obligation requires PKCT to undertake a bona fide investigation of reducing contractors. In relation to Mr Giddings and Mr Rosewarn it completely failed to do so. It did not undertake any proper comparative assessment of their skills and competencies to ascertain the viability of reducing contractors and redeploying them into that work, and instead it so restricted its consideration of reducing contractors that there were no contractors that fell to be considered. 379 Second, there is little in the terms of cl. 13.5.3 to suggest that the investigation of reducing contractors should be restricted in the way PKCT contended. The clause requires PKCT to investigate the reduction of contractors where that work can be performed by an employee having regard to the skills and competencies of the affected employees and the nature of the work. There is no dispute between the parties that an affected employee must have suitable skills and competencies before a particular contractor role can be seen as suitable for his or her redeployment. The issue is whether, on the proper construction of the clause, it was open to PKCT to confine its investigation of reducing contractors to contractors engaged on a full time and permanent basis. 380 It would have been straightforward for the drafter to exclude from consideration any contractor roles which were not full time and permanent, but on its ordinary meaning no such exclusion appears. Clause 13.5.3 focuses on the work undertaken by contractors but does not advert to the nature of a contractor's role, making no distinction between permanent or non-permanent contractors or between full time and part time contractors. This points away from PKCT's construction of the clause. 381 Third, the context in which the parties entered the Agreement points away from PKCT's construction. PKCT announced the Upgrade Project in 2011 which meant there were to be many more contractors engaged at the terminal. I infer that no contractors were engaged on a full time and permanent basis at the time the parties entered the Agreement in 2012, and that PKCT had no intention of engaging contractors on that basis in the future. At the material time, on Mr Stewardson's evidence, there were between 55 and 65 contractors engaged at the terminal. Construed in its context it cannot be that the parties intended to so restrict the clause that, in reality, there were no contractors to be considered for reduction. 382 Fourth, cl. 13.5.3 requires an investigation of all avenues to avoid forced redundancies including by reducing contractors' work. As I have said, PKCT did not undertake a proper investigation. I can accept that a proper investigation might have revealed that the only suitable contractors' work was undertaken on a part-time basis, and it might have shown that it was not viable to redeploy Mr Giddings and Mr Rosewarn into that work. However, in my view the obligation to investigate all avenues to avoid forced redundancies extended to an obligation to consider the suitability of bundling work performed by different part-time contractors into a single position, and/or bundling work performed by different types of contractors, perhaps for different periods of time, into a single position. PKCT gave that no consideration. 383 Further, I can accept that a proper investigation might have revealed that a potentially suitable contractor role was shortly coming to an end, and it might have shown that it was not viable to redeploy Mr Giddings and Mr Rosewarn into that work. However, in my view the obligation to investigate all avenues extended to an obligation to consider redeploying an affected employee initially into one contractor role and then moving him or her to another contractor role when the first role came to an end. It also includes an obligation to consider whether it might be suitable to redeploy the employee back to a position within PKCT if one had become vacant in the interim. Retirements, resignations and other types of attrition in the large workforce at the terminal meant that vacancies were likely to arise from time to time. 384 By restricting its consideration of reducing contractors only to contractors engaged on a full-time and permanent basis PKCT completely closed off the possibility that Mr Giddings and Mr Rosewarn might be redeployed into contractors' work. I consider it breached cl. 13.5.3. 385 Finally, it was not necessary for the Union, in order to establish a breach of the Agreement, to show that there was, in fact, contractors' work that could be undertaken by one or other of Mr Giddings and Mr Rosewarn. However, I am fortified in my view that PKCT failed to comply with cl. 13.5 when the evidence shows that Mr Giddings and Mr Rosewarn had skills and competencies suitable for a number of contractor roles at the terminal. 386 I have previously set out their extensive experience and qualifications and I will not do so again. Without descending into the minutiae of the evidence, it is likely that Mr Giddings could have undertaken the work performed in the contractor roles of Project Supervisor (as could Mr Rosewarn), Asset Management Specialist and Contracts Manager (as Mr Gorman said in the Scenario Planner) and the MTEC position (as Ms Ragen indicated). At that time the MTEC Electrical and Mechanical contractor positions were filled by secondees from PKCT, but in December 2014 one of these positions was filled by a contractor. Mr Stewardson conceded that the work performed by that contractor could have been performed by Mr Giddings. 387 I am not satisfied that Ms Arber could have been redeployed into contractors' work. At the relevant time there were three contractors who undertook administrative work at the terminal, being: (a) Ms Uren who worked four days a week as a HR Advisor providing administrative support in the Human Resources team. Mr Tonini said, and I accept, that this role was coming to an end in April 2015. Given the limited remaining term of that engagement, and that Ms Arber would have required four to six weeks of training, in my view there was no requirement for PKCT to redeploy Ms Arber into that work; (b) Ms Jenny Jeffreys who worked full time as a Document Controller for PPM Project Engineering ("PPM"), the company responsible for running the R&C Project. Mr Tonini said, and I accept, that while Ms Arber would have been capable of doing some of the duties of that role with minimal training, the role involved other tasks which required lengthy training and formal qualifications. The current Document Controller has a post-graduate diploma in Information Sciences as well as two other university degrees. In my view there was no requirement for PKCT to redeploy Ms Arber into that work; and (c) Ms Joan Gaze who worked full time as a Project Support Administrator for PPM. Mr Tonini said, and I accept, that Ms Arber would have required approximately four to six weeks of training before she could be redeployed into that position. He also said that PKCT did not have the practical ability to terminate Ms Gaze's employment so that Ms Arber could be redeployed. Putting that argument to one side, in my view there was no requirement for PKCT to redeploy Ms Arber into that work.

The alleged failure to comply with cl. 4(k) of Appendix 1 388 Appendix 1 of the Agreement is titled "Grading System". It sets out the grading system for PKCT's employees having regard to their qualifications, skills, experience, competency, position, including whether particular positions are "Appointed" or not, and their stream. It relates to the progression of employees through the different grades within streams and categories. 389 Appointed positions, such as the Daywork Appointed positions of Long Term Planner and Facilities Maintenance Engineer previously occupied by Mr Giddings and Mr Rosewarn, are the only Grade 7, 8 and 9 positions (the highest grades under the Agreement). 390 Clause 4(k) provides: The addition or deletion of the number of appointed positions will be by agreement between the Company and the Employee Representatives considering business needs. The Appendix does not otherwise limit the addition or deletion of positions. 391 It is uncontentious that PKCT abolished the positions of Long Term Planner and Facilities Maintenance Engineer without the Union's agreement, and clear that the abolition of those positions meant that two Appointed positions had been deleted. 392 The Union argued that abolition of those two positions constituted a breach of the clause. It noted that cl. 4(k) does not preclude PKCT (without the Union's agreement) from taking a variety of other steps short of abolition, and does not preclude PKCT from terminating the employment of a person holding an Appointed position, changing the nature of an Appointed position and replacing it with another different Appointed position or reducing the total number of positions or employees under the Agreement. It contended that the limitation on the deletion of Appointed positions was intended to protect the number of promotional opportunities available to employees under the Agreement, and that abolition of the Appointed positions removed an important part of the agreed career structure. 393 On its face, the clause prohibits the abolition of Appointed positions without the Union's agreement. However, I do not accept the Union's contention which, in my view, misconstrues the clause. 394 First, cl. 13.5 is titled "Redundancy" and it deals with that topic completely. Importantly, cl. 13.5.2 requires PKCT to consult with the Union in regard to any workforce reductions but does not require it to obtain the Union's consent before deciding to make an employee in an Appointed position redundant. Clause 13.5.1 strongly indicates that PKCT makes any decision to manage manning levels to suit its business needs, and that a decision to abolish a position is within PKCT's prerogative. 395 Second, if cl. 4(k) is construed as the Union contends the Agreement contains terms which are inconsistent with each other. Where different parts of an agreement are inconsistent, effect must be given to that part which is calculated to carry into effect the real intention of the parties as gathered from the agreement as a whole. The Court must decide which term represents the objective intention of the parties in the circumstances: Seddon N, Bigwood R, Ellinghaus M, Cheshire and Fifoot law of Contract (10th edition, LexisNexis Butterworths Australia, 2012) at [10.32]. There is nothing in the context of the Agreement or in the evident purpose of the parties which points towards a conclusion that they intended that the Union would effectively have a veto over any decision to make an employee in an Appointed position redundant. I note again that SDA v Woolworths stands for the proposition that a paramount consideration in construing an industrial agreement is its context and the intention or purpose of its makers. 396 Third, the conflict between the two clauses means the Agreement should be construed so that the specific provisions dealing with redundancy in cl. 13.5 prevail over the provisions relating to grading of employees in Appendix 1. The parties intended to deal with "redundancy situations" in cl. 13.5 and not by a side wind in clause 4(k) of Appendix 1. 397 Fourth, cl. 4(k) relates to the grading of employees and their progression through the different grades. The prohibition on adding to or deleting the number of Appointed positions without the Union's agreement should be understood as relating to grading and progression rather than relating to redundancy. It may well be, as the Union contended, that cl. 4(k) reflects the parties' intention to protect the number of opportunities for employees to be promoted to higher grades, but it is focused on the number of Appointed positions. PKCT would have complied with the clause if it had abolished Mr Giddings' and Mr Rosewarn's positions in accordance with cl. 13.5 and then converted two other positions into Appointed positions. In that event the number of Appointed positions would not have altered. This tends to confirm that clause 4(k) should not be construed as prohibiting abolition of an Appointed position. This proposition may be argued to point to a different breach of the Agreement but I have heard no argument in that regard and I do not decide that question. 398 I am not satisfied that PKCT breached cl. 4(k) as alleged by the Union.

The adverse action Claim 399 The Union alleged that PKCT, with Mr Green's knowing involvement, took adverse action against Mr Giddings for a prohibited reason (in contravention of ss 340(1) and 346 of the Act) by terminating his employment because: (a) he exercised, or proposed to exercise a workplace right, namely his role or responsibilities under a workplace law and/or workplace instrument being the roles of Lodge President and of employee representative under the Agreement; and/or (b) he was an officer of an industrial association, namely the Lodge President; and/or (c) he had engaged in industrial activity (as defined in s 347(a) and s 347(b)(ii), (iii) and (v) of the Act).

The legislative framework and relevant principles 400 Part 3-1 of the Act is headed "General Protections", and it provides employees with general workplace protections. The object of the Part is set out in s 336 and includes "to protect workplace rights".

The adverse action claim under s 340 401 Section 340(1) of the Act provides: Protection (1) A person must not take adverse action against another person: (a) because the other person: (i) has a workplace right; or (ii) has, or has not, exercised a workplace right; or (iii) proposes or proposes not to, or has at any time proposed or proposed not to, exercise a workplace right; or (b) to prevent the exercise of a workplace right by the other person. 402 Section 341(1)(a) provides: Meaning of workplace right (1) A person has a workplace right if the person: (a) is entitled to the benefit of, or has a role or responsibility under, a workplace law, workplace instrument or order made by an industrial body; or … 403 Section 12 of the Act defines the term "workplace law" to include the Act. It defines "workplace instrument" to mean an instrument that is made under, or recognised by, a workplace law, and concerns the relationships between employers and employees. It is uncontroversial that the Agreement is a workplace instrument under the Act. 404 Section 342(1) sets out a table with the circumstances in which a person is to be treated as having taken "adverse action" against another person, thereby providing the meaning of that expression. It is uncontentious that the dismissal of an employee by an employer, as in the present case, constitutes "adverse action" within the meaning of s 342(1) Item 1(a).

The adverse action claim under s 346 405 Section 346 relevantly provides: Protection A person must not take adverse action against another person because the other person: (a) is or is not, or was or was not, an officer or member of an industrial association; or (b) engages, or has at any time engaged or proposed to engage, in industrial activity within the meaning of paragraph 347(a) or (b); … 406 The term "officer" is defined in s 12 of the Act to include an "official" of an industrial association. The term "official" is defined in s 12 to mean "a person who holds an office in, or is an employee of, the association." It is uncontentious that the CFMEU is an industrial association, and that through his role as Lodge President Mr Giddings is and was at all material times an officer of the Union. 407 Section 347 of the Act relevantly provides: Meaning of engages in industrial activity A person engages in industrial activity if the person: (a) becomes or does not become, or remains or ceases to be, an officer or member of an industrial association; or (b) does, or does not; … … (ii) organise or promote a lawful activity for, or on behalf of, an industrial association; or (iii) encourage, or participate in, a lawful activity organised or promoted by an industrial association; or … (v) represent or advanced the views, claims or interests of an industrial association; or …

Multiple reasons for adverse action 408 An employer takes adverse action for a prohibited reason if the reasons for the action include that reason. Section 360 of the Act provides: Multiple reasons for action For the purposes of this Part, a person takes action for a particular reason if the reasons for the action include that reason.

The onus on the employer 409 When an employee alleges that an employer has taken action against him or her for a prohibited reason, s 361 casts the onus on the employer to "prove otherwise". It provides: Reason for action to be presumed unless proved otherwise (1) If: (a) in an application in relation to a contravention of this Part, it is alleged that a person took, or is taking, action for a particular reason or with a particular intent; and (b) taking that action for that reason or with that intent would constitute a contravention of this Part; it is presumed that the action was, or is being, taken for that reason or with that intent, unless the person proves otherwise. … 410 In reference to an analogous provision to s 361 the rationale for this presumption was explained by Mason J in General Motors Holden Pty Ltd v Bowling (1976) 12 ALR 605 at 617 as being to throw on to the employer the onus of proving that which lies peculiarly within its own knowledge. His Honour said: Section 5(4) imposed the onus on the [employer] of establishing affirmatively that it was not actuated by the reason alleged in the charge. The consequence was that the [employee], in order to succeed, was not bound to adduce evidence that the [employer] was actuated by that reason, a matter peculiarly within the knowledge of the [employer]. The [employee] was entitled to succeed if the evidence was consistent with the hypothesis that the [employer] was so actuated and that hypothesis was not displaced by the [employer]. To hold that, despite the subsection, there is some requirement that the prosecutor brings evidence of this fact is to make an implication which, in my view, is unwarranted and which is at variance with the plain purpose of the provision in throwing on to the [employer] the onus of proving that which lies peculiarly within his own knowledge. 411 This reasoning was endorsed by the High Court in Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500 ("Barclay") at [51] (French CJ and Crennan J) and [86] (Gummow and Hayne JJ). 412 To displace the presumption, the respondent must show that its conduct was not motivated in whole or in part by the prohibited reason. A failure to displace the presumption enables the allegation by an applicant of adverse action for a prohibited reason to stand as sufficient proof of that fact: Davids Distribution Pty Ltd v National Union of Workers (1999) 91 FCR 463 at [109] (Wilcox and Cooper JJ); Australian Municipal, Administrative, Clerical and Services Union v Greater Dandenong City Council (2000) 101 IR 143 at [37] (Madgwick J). 413 However, as Barclay makes clear, the presumption must not be treated as creating so heavy a burden that it is effectively impossible for the employer to discharge it. French CJ and Crennan J explained its application (at [60] to [63]) as follows: First, it is erroneous to treat the onus imposed on an employer by s 361 as being made heavier (or rendered impossible to discharge) because an employee affected by adverse action happens to be an officer of an industrial association. … Central to the respondents' argument on this appeal was the contrary and incorrect view that Mr Barclay's status as an officer of an industrial association engaged in lawful industrial activity at the time that Dr Harvey took adverse action against him meant that Mr Barclay's union position and activities were inextricably entwined with the adverse action, and that Mr Barclay was therefore immune, and protected, from the adverse action. If accepted, such a position would destroy the balance between employers and employees central to the operation of s 361, a balance which Parliament has chosen to maintain irrespective of the fact that the protection in s 346(b) has a shorter history than the protection in s 346(a). That balance, once the reflex of criminal sanctions in the legislation, now reflects the serious nature of the civil penalty regime. … Secondly, it is a related error to treat an employee's union position and activity as necessarily being a factor which must have something to do with adverse action, or which can never be dissociated from adverse action. It is a misunderstanding of, and contrary to, Bowling to require that the establishment of the reason for adverse action must be entirely dissociated from an employee's union position or activities. Such reasoning effectively institutes an interpretation of the relevant provisions indistinguishable from that of Isaacs J in Pearce, which was rejected in Bowling. The onus of proving that an employee's union position and activity was not an operative factor in taking adverse action is to be discharged on the balance of probabilities in the light of all the established evidence. Thirdly, it is appropriate for a decision-maker to give positive evidence comparing the position of the employee affected by the adverse action with that of an employee who has no union involvement. (Emphasis added.) 414 In relation to the Court's task of deciding whether an employer's evidence discharges the burden, French CJ and Crennan J observed (at [44]-[45]): …The imposition of the statutory presumption in s 361, and the correlative onus on employers, naturally and ordinarily mean that direct evidence of a decision-maker as to state of mind, intent or purpose will bear upon the question of why adverse action was taken, although the central question remains "why was the adverse action taken?" This question is one of fact, which must be answered in the light of all the facts established in the proceeding. Generally, it will be extremely difficult to displace the statutory presumption in s 361 if no direct testimony is given by the decision-maker acting on behalf of the employer. Direct evidence of the reason why a decision-maker took adverse action, which may include positive evidence that the action was not taken for a prohibited reason, may be unreliable because of other contradictory evidence given by the decision-maker or because other objective facts are proven which contradict the decision-maker's evidence. However, direct testimony from the decision-maker which is accepted as reliable is capable of discharging the burden upon an employer even though an employee may be an officer or member of an industrial association and engage in industrial activity. (Emphasis added. Citations omitted.) 415 Gummow and Hayne JJ described the Court's task (at [127]) as: … to assess whether the engagement of an employee in an industrial activity was a "substantial and operative factor" as to constitute a "reason", potentially amongst many reasons, for adverse action to be taken against that employee. In assessing the evidence led to discharge the onus upon the employer under s 361(1), the reliability and weight of such evidence was to be balanced against evidence adduced by the employee and the overall facts and circumstances of each case; but it was the reasons of the decision-maker at the time the adverse action was taken which was the focus of the inquiry. (Emphasis added.) 416 The relevant principles to be drawn from Barclay include that: (a) the question of whether a particular action or decision was taken because of a proscribed reason, or for reasons which included a proscribed reason, is a question of fact to be determined on the whole of the evidence; (b) the proscribed reason must be a substantial and operative reason for taking the adverse action; (c) direct evidence of the decision-maker, if accepted as reliable, is capable of discharging the burden upon an employer; (d) direct evidence of the decision-maker may be unreliable because of, amongst other things, other contradictory evidence given by the decision-maker or because other objective facts are proven which contradict the decision-maker's evidence. It is a question to be decided on all the evidence; (e) a mere declaration by a witness as to his or her "mental state" may not be sufficient to discharge the employer's onus; and (f) the test for whether action was taken for a proscribed reason is neither wholly subjective or objective.

PKCT's reasons for the termination 417 In its letter of 11 December 2014, PKCT advised Mr Giddings that his employment was terminated because his position was redundant, and that his position was no longer required. PKCT said that the reason for the termination of his employment was redundancy, and Mr Green gave evidence to the same effect. 418 As a corporation PKCT acts through its officers, employees and agents, and as a general proposition the actions of PKCT's employees are attributable to the corporation. To determine PKCT's liability it is necessary to ascertain which individual or individuals are responsible for the decisions made on its behalf. In the present case it is uncontentious that there is only one decision maker, or directing mind, and the task of determining PKCT's reasons for particular action is relatively straightforward. I say this because although Mr Gorman, Mr Stewardson and Ms Ragen played a role in the decision to terminate Mr Giddings' employment through their recommendations, it is common ground that the decision to terminate his employment was made by Mr Green, in his capacity as PKCT's General Manager. 419 It is plain that it Mr Green's reasons for the decision that are relevant in the enquiry under ss 340 and 346.

Mr Giddings' Union roles and industrial activities 420 The evidence shows that Mr Giddings was a longstanding member of the Union and its predecessor. He was active in the Union, and he held a number of Union or Union related leadership positions, including being: (a) a member of the Union's District Branch Board of Management from 2000. He was the only PKCT employee on the Board of Management; (b) the Lodge President from April 2000; (c) the President of the National Coal Ports Conference from 2006; (d) an employee representative under the Agreement and its predecessor, including as the employee representative on the PKCT Employee Entitlements Fund; (e) a member of the PKCT Health and Safety Committee from December 2012; and (f) the Health and Safety Representative for Indoor Dayworkers from July 2014. 421 It is uncontentious that Mr Giddings' activities in the positions of Lodge President and employee representative under the Agreement involved his exercising a workplace right under s 341 and uncontentious that such activities are "protected" pursuant to s 340. 422 PKCT sought to downplay the significance of Mr Giddings' role in the Union's industrial activities, but I am satisfied on the evidence that in his roles as Lodge President and employee representative he was centrally involved in a number of industrial disputes at the terminal, including: (a) a dispute regarding changes to the applicable superannuation scheme which arose when ownership of the terminal was transferred from state management to the private consortium. Proceedings in the New South Wales Industrial Court have been on foot since 2005 in relation to this dispute, in which PKCT has incurred costs of about $1.3 million; (b) a dispute in November 2011 about the application of the Rail Safety Act 2008 (NSW) at the terminal which involved multiple on-site meetings; (c) a dispute in January 2012 in which the Union applied to the Fair Work Commission to require an appropriate venue for a protected industrial action ballot; (d) a dispute in February 2012 as part of the negotiations for a new enterprise agreement, involving three weeks of protected industrial action; (e) a dispute in October 2012 in which PKCT applied to the Fair Work Commission to stop alleged unauthorised industrial action; (f) a dispute in February 2013 in which employees refused to undertake additional hours of work on the basis that PKCT sought their availability in a manner inconsistent with the Agreement; and (g) three separate disputes in August 2013, which concerned: (i) the composition of the Health and Safety Committees; (ii) the entitlement of casual employees to meal money; and (iii) suspected non-compliance the Agreement regarding the work undertaken by contractors. It is clear on the evidence that, in those disputes, Mr Giddings engaged in "industrial activity" within the meaning of s 347. It is uncontentious that such activities are "protected" pursuant to s 346. 423 Although Mr Giddings had other Union roles, the only roles which I consider material in respect of his "industrial activity" are his roles as Lodge President and employee representative. The evidence tends to show that Mr Giddings was a forceful and somewhat uncompromising advocate for the interests of the Union and its members and effective in his roles of Lodge President and employee representative. 424 Broadly, the Union contended that as a result of Mr Giddings' industrial activities in his role as Lodge President and as employee representative, particularly his lead role in the large 2012 dispute in support of a new enterprise agreement, Mr Green became frustrated and resentful towards Mr Giddings and the influence he wielded at the terminal through his Union roles. The Union argued that Mr Green saw Mr Giddings as an impediment to what he saw as necessary workplace changes and that Mr Green terminated his employment because of his Union role and or his industrial activities. 425 Boiled down, the Union's contentions were based on the contention that because of Mr Giddings' Union roles and/or industrial activities Mr Green: (a) targeted his position for redundancy so that his employment would be terminated; and/or (b) decided not to offer voluntary redundancies in relation to his position and to limit the consideration of reducing contractors so that he could not be redeployed into other work and his employment would be terminated. In my view the second of these contentions finds more support in the evidence than the first.

PKCT's case 426 In his evidence Mr Green consistently denied that Mr Giddings' Union roles and industrial activities formed any part of the substantial and operative reasons for the decision to terminate his employment. Mr Stewardson and Mr Gorman essentially corroborated his evidence in that regard. PKCT pointed to a series of matters to show that the reasons for Mr Green's termination of Mr Giddings' employment did not include his Union roles and/or his industrial activities. 427 First, it pointed to Mr Green's evidence regarding the background to his decision to abolish Mr Giddings' position which included the deteriorating conditions in the coal industry and the 2013 decision not to proceed with the Upgrade Project. PKCT said that the Long Term Planner position was created in anticipation of an upgrade of terminal capacity through the Upgrade Project and that since that project was no longer being pursued the duties performed in that position could be performed by other employees with minimal operational disruption. 428 PKCT also relied on Mr Stewardson's and Mr Gorman's evidence that they had reviewed the functions of positions within the Engineering team and had identified scope for the removal of the Long Term Planner and Facilities Maintenance Engineer positions. In respect of the Long Term Planner position, based on the available information, they decided the position was underutilised and/or there was insufficient work to keep Mr Giddings busy on a full-time basis. 429 PKCT's contention in this regard boils down to the proposition that there was a substantial business case for Mr Green's decision to make the Long Term Planner position redundant. I have no difficulty in accepting that there was a business case for selecting the Long Term Planner position for abolition. In light of the deteriorating conditions in the coal industry there was a real need for cost savings and PKCT could achieve some cost savings and efficiencies by the abolition of Mr Giddings' position (along with the other positions). 430 However, that does not answer the allegation that the substantial and operative reasons for Mr Green's refusal to offer voluntary redundancies in relation to Mr Giddings' position and to restrict the consideration of reducing contractors included his Union roles and/or his industrial activities. As I have said, those decisions meant that Mr Giddings could not be redeployed and it was inevitable that his employment would be terminated if his position was abolished. 431 Second, PKCT accused the Union of trawling through Mr Giddings' history of involvement in industrial activities looking to use them as reasons why PKCT had decided to terminate his employment. It asserted that the various industrial disputes on which the Union relied were in some instances many years ago and in other instances the issues were resolved or were no longer pursued by the Union or by PKCT even where there was a right to do so. It argued that the list of industrial disputes relied on was selective and incomplete. In broad terms I accept this. In my view Mr Giddings' involvement in the 2012 industrial dispute is the most relevant to Mr Green's adverse view of Mr Giddings because of his Union role and/or his industrial activities. 432 While PKCT did not deny that Mr Giddings had actively engaged in industrial activities over a number of years it noted that other employee representatives had similarly active roles. I accept this, but I note that Mr Giddings was the most senior Union official on site and on my view of the evidence the most effective. 433 Of course, as PKCT argued, Mr Giddings' mere participation in such industrial activities does not, of itself, provide the basis for a finding that Mr Green took adverse action for reasons which included that participation. 434 Third, PKCT pointed to the fact that, notwithstanding Mr Giddings' long history of active involvement in industrial activities at the terminal there was no evidence of any adverse action previously having been taken against him. The only time Mr Giddings alleged that adverse action was taken against him is in the present case. I accept this. 435 Fourth, PKCT argued that the Union relied on Mr Giddings' involvement in industrial activities since 2008 when Mr Green commenced as General Manager, yet in the same period Mr Green had provided Mr Giddings with substantial further education through payment support for a Masters of Business Degree, had promoted him to the highest grade under the Agreement, and had treated him as integral and trusted in the job redesign process in 2013 (in which the Long Term Planner position was created). That PKCT took those steps is clear on the evidence. 436 PKCT also pointed to evidence suggesting that Mr Green treated Mr Giddings with respect including by requesting an apology from the Human Resources Manager for comments made to Mr Giddings during industrial negotiations, by attending the funeral of Mr Giddings' mother, and by sending advertisements for external job vacancies to Mr Giddings. I accept that Mr Green took those steps, but they are equally consistent with Mr Green's recognition of Mr Giddings' influence at the terminal. Mr Giddings placed a different characterisation on Mr Green's provision of external job vacancies. I do not attribute much significance to them, either way. 437 Fifth, PKCT noted that the Union had continued to have an active role in industrial issues at the terminal since termination of Mr Giddings' employment, and that PKCT continued to meet with Union representatives in relation to various disputes. It argued that the continuation of Union activities at the terminal shows that there is no rational basis to assert that the substantial and operative reasons for Mr Green's decision to terminate Mr Giddings' employment included his Union roles and/or his industrial activities. I am not satisfied as to this. The evidence tends to show that Mr Giddings was a particularly effective Union representative and it is likely that there was some advantage for PKCT in Mr Giddings' absence from the next round of enterprise agreement negotiations. However, little turns on that. 438 Sixth, PKCT contended that Mr Green gave clear evidence that there were no vacant positions within PKCT into which Mr Giddings could have been redeployed so as to avoid his forced redundancy. I accept this. My decision is not based on the proposition that there were vacant positions within PKCT at the time Mr Giddings' employment was terminated. 439 Seventh, it contended that Mr Green gave clear and consistent evidence that: (a) the Agreement did not require offers of voluntary redundancy in relation to Mr Giddings' position. As I have said, I do not agree; (b) it was not operationally efficient or reasonable to offer voluntary redundancies in relation to Mr Giddings' position. As I have said, I do not accept that evidence; and (c) in any event, Mr Giddings did not have suitable skills and competencies to properly perform any other position within PKCT. As I have said, I do not agree. The evidence shows that had suitable skills and competencies to perform a number of other positions. 440 Eighth, it argued that Mr Green gave clear and consistent evidence that: (a) there were no contractors that were engaged on a full-time and permanent basis and therefore no contractors' work into which it was practical to place Mr Giddings. I accept this but it is somewhat beside the point; (b) he gave proper consideration to the issue of reducing contractors. As I have said, I do not accept this; and (c) in any event, Mr Giddings did not have suitable skills and competencies to properly undertake contractors' work. As I have said, I do not accept this. 441 Ninth, PKCT argued that the only basis upon which the Union asserted that Mr Green's evidence should be disbelieved was that the evidence demonstrated that Mr Giddings' redundancy was a sham. It argued that the Union mounted a case alleging that PKCT embarked on an elaborate scheme to abolish Mr Giddings' position and terminate his employment, and that the scheme included the dismissal of Mr Rosewarn and Ms Arber as "collateral damage". 442 I do not accept that the Union's case was so limited. Its case included the contention that Mr Green was motivated by Mr Giddings' Union role and his industrial activities when he refused to offer voluntary redundancies in relation to his position and restricted the investigation of reducing contractors, which had the inevitable result that his employment was terminated. 443 Tenth, PKCT noted that the Union's case involved the proposition that Mr Green made the decision to terminate Mr Giddings' employment in about July 2014 and it argued that Mr Green's evidence about the timing of his decision should be accepted. As I have said, I do not accept Mr Green's evidence in this regard.

Consideration regarding the adverse action claim against PKCT 444 I found Mr Green's evidence unreliable and I need not reiterate my reasons for doing so. While his evidence was essentially corroborated by Mr Gorman and Mr Stewardson their evidence was similarly unreliable and, even taken together, their evidence carries little weight. 445 My view of the unreliability of Mr Green's evidence, together with my rejection above of many of PKCT's contentions, has led me to conclude that PKCT failed to discharge its onus to show that the substantial and operative reasons for its decision to terminate Mr Giddings' employment did not include Mr Giddings' Union roles and/or industrial activities. I find that PKCT contravened ss 340 and 346 of the Act. 446 It is unnecessary to go any further than this. However, I must deal with the claim of accessorial liability against Mr Green, and that claim requires that I decide whether the evidence is sufficient to establish that Mr Green's reasons for terminating Mr Giddings' employment (with which PKCT is fixed) included his Union roles and/or his industrial activities. As I will explain, I am satisfied in that regard.

The claim of accessorial liability against Mr Green 447 It is uncontentious that for the Union to make out its claim of accessorial liability under s 550(1) of the Act, it is required to prove that Mr Green was knowingly concerned in PKCT's contraventions: s 550(2)(c). In relation to this claim the reverse onus in s 361 of the Act does not apply. 448 The Union is required to establish that Mr Green had knowledge of each essential element of the contravention: Yorke v Lucas (1985) 158 CLR 661 at 670. Intention is critical as liability depends upon the accessory associating himself or herself with the contravening conduct, that is, the accessory must be linked in purpose with the perpetrators: Construction, Forestry, Mining and Energy Union v Clarke [2007] FCAFC 87; 164 IR 299 (Tamberlin, Gyles and Gilmour JJ) at [46], citing Gibbs CJ in Giorgianni v The Queen (1985) 156 CLR 473 at 479-480. Actual knowledge of the essential elements of the contravention is required: Bowler v Hilda Pty Ltd [2000] FCA 899 at [78] (Finn J). 449 I have kept in mind that Mr Green (corroborated to an extent by Mr Gorman and Mr Stewardson) consistently denied that he had an adverse view of Mr Giddings, that he thought Mr Giddings and the Union had too much influence at the terminal, and that any part of his reasons for terminating Mr Giddings' employment included his Union roles and/or industrial activities. However, as I have said, I give Mr Green's evidence (and that of Mr Gorman and Mr Stewardson) little or no weight. 450 In my view there are strong grounds to infer that Mr Green's reasons for the decision to terminate Mr Giddings' employment included his Union roles and/or industrial activities. I say this, first, because on my view of the evidence it is likely that the 2012 industrial dispute about the new enterprise agreement led to a material deterioration in Mr Green's view of Mr Giddings and it is likely that he came to see Mr Giddings as a serious impediment to the workplace changes which Mr Green thought were necessary. 451 It is uncontentious that the 2012 dispute regarding the new enterprise agreement at the terminal was a significant one. Negotiations for a new enterprise agreement started in about November 2010 and, despite numerous meetings over the course of 2011, PKCT and Union could not reach agreement. Mr Giddings was a lead negotiator for the Union in the negotiations and it is likely in my view that Mr Green became frustrated with and resentful of the Union and Mr Giddings. 452 This frustration, and a developing antipathy, can be seen in the "Confidential - Briefing paper for PKCT directors on PKCT Enterprise Agreement 2011" dated 17 November 2011 ("Briefing Paper"), in which Mr Green reported to PKCT's shareholders on the progress of negotiations. He said: Approximately one year ago, discussions commenced with employee representatives for an Enterprise Agreement (EA) to replace the current EA. The current EA expired on 30 June 2011. Over 30 meetings have taken place. Progress on a number of matters has been very slow and employee representatives have conducted their discussions on the basis of conceding nothing, and seeking to add to the regulation contained in the document. Union and employee representatives see the federal industrial relations framework together with the buoyant nature of the resource sector as their time to recoup matters they feel that have been given up in the past. A sense of arrogance is conveyed. (Emphasis added.) 453 Mr Green's view that the Union displayed "a sense of arrogance" and the frustration which the report reflects is likely to have been directed at Mr Giddings to a significant extent. He was a lead negotiator in the vexed negotiations, an experienced and forceful advocate, the most senior Union official at the terminal, and the official with whom Mr Green was required to have most regular contact. While Mr Green denied any antipathy towards Mr Giddings his evidence in that regard is implausible. 454 In the Briefing Paper Mr Green said that, by November 2011, PKCT had reached its "final position" and it had made a final proposal to the Union which was designed to settle the dispute. However, the differences between PKCT and the Union dispute did not resolve when PKCT put its final position. 455 In fact, the dispute intensified thereafter and took a turn for the worse from PKCT's viewpoint. The Union rejected PKCT's final position, and in January 2012 Mr Giddings advocated for employees at the terminal to take protected industrial action against PKCT, including by way of consecutive seven-day stoppages. That proposal received overwhelming support from the employees, as can be seen in the fact that in the "protected action" ballot 89% of employees voted and 95% of them voted in favour of the stoppages proposed. 456 Then Mr Giddings was a leader of the campaign in which the employees took 186 hours of consecutive work stoppages over a three week period in February 2012. Mr Gorman described this industrial action as "unnecessary and highly disruptive". I infer that the lengthy stoppages caused PKCT significant losses, and see it as likely that Mr Green came to feel frustration, resentment, and perhaps anger, in relation to Mr Giddings' Union role and industrial activities. Again, I found Mr Green's testimony that he had no ill feeling towards Mr Giddings to be implausible. 457 PKCT made further concessions to the Union shortly after the stoppages and the dispute resolved. The parties signed the new Agreement in March 2013, but it was not what PKCT had wanted. Amongst other things, the evidence shows that PKCT had sought an enterprise agreement which provided increased "flexibility" and a "significant improvement in organisational agility". Mr Stewardson said these expressions referred to a need to change the "team system" at the terminal and that PKCT wanted a change to "individual accountability rather than team accountability" so that the performance management process had management involvement rather than team involvement. 458 I infer that Mr Green saw these changes as important but Mr Giddings vigorously opposed them, and in the finish Mr Green did not achieve the changes he wanted. The Agreement also provided for 4.5% annual wage increases over the term of the Agreement and a payment of four cents per tonne into the Employee Entitlements Fund. 459 Mr Green admitted that PKCT was dissatisfied with the Agreement. Mr Stewardson described it as "restrictive" and conceded that PKCT saw it as unsatisfactory. By contrast, in an email on 22 February 2012 Mr Giddings described it as "a significant win". I infer that Mr Green felt that PKCT was forced into the unsatisfactory Agreement by the Union's industrial campaign, in which Mr Giddings played a lead role. 460 Mr Green's denied that he thought that the Union had too much influence on the site. I found that denial utterly implausible. In fact, PKCT's negotiating protocol for the 2011/12 enterprise agreement negotiations included the "key goal" that employees come to look to PKCT as their future rather than to the Union. It is likely that Mr Green developed a materially adverse view of Mr Giddings through his lead role in the 2012 campaign and came to see Mr Giddings' Union roles and/or industrial activities as a serious impediment to achieving necessary changes at the terminal. 461 Second, the annual 4.5% wage increases were likely to have been particularly galling for Mr Green. The conditions in the coal industry were seriously deteriorating and in Mr Green's view significant cost savings were required. At the same time the annual wage increases were coming into effect, and in circumstances where Mr Green and the senior managers had themselves agreed to a salary freeze, Mr Giddings advocated against the employees accepting a wage freeze and a 12 month suspension of the regrading of positions. Mr Green accepted that Mr Giddings was influential in persuading employees to reject the wage freeze. I have little doubt that Mr Green thought that necessary cost savings would be easier to achieve if Mr Giddings was no longer in PKCT's employ. 462 Third, the issues in contention in the 2012 stoppages were not just matters of history at the time that Mr Green was considering the proposal to abolish Mr Giddings' position and terminate his employment. In this period Mr Green was still seeking changes to the "team system" and still wanted to freeze the annual pay increases and suspend the regrading of positions. That changes to the team system and concern about the annual wage increases were still important to Mr Green and his senior managers can be seen, amongst other things, in the following matters: (a) in April 2014 in his "Organisational Redesign Stage 2" proposal sent to Ms Ragen, Mr Stewardson argued for the "current restrictive EA" to be changed to "allow discretionary effort and time at work to be controlled by individuals based on performance management feedback"; (b) on 4 July 2014 Mr Green sought to vary the Agreement. Mr Green accepted that Mr Giddings was influential in the Union's decision to reject the proposed variations and Mr Green informed the Board that the wage freeze proposal had no chance of success because the Union executive did not recommend it; (c) in July 2014 in his "Phase 2 Background to Tomorrow's Discussion" document Mr Stewardson showed his frustration with the pace of change at the terminal. He said that the necessary organisational changes at PKCT could not be achieved in a timely way with consultation, and that PKCT should "just do it". As I have said, I infer that Mr Green had a similarly dismissive approach to the requirement for consultation; and (d) Mr Stewardson said that PKCT was seeking changes to the team system and to performance management in the enterprise agreement negotiations which were scheduled to commence in April 2015. That Mr Giddings was not seen in a positive light can be seen in Mr Stewardson's June 2014 "Nirvana" chart which revealed his view that, ideally, Mr Giddings would no longer be employed at the terminal. 463 In my view Mr Giddings' continued resistance to what Mr Green saw as necessary changes was likely to have fuelled Mr Green's frustration and resentment about his Union roles and/or industrial activities. Again, I have little doubt that Mr Green thought that the necessary changes would be more easily achieved if Mr Giddings was no longer employed at the terminal. 464 Fourth, Mr Giddings treated Mr Green in ways that were likely to have added fuel to Mr Green's frustration and resentment. Amongst other things: (a) Mr Green asked Mr Giddings for an opportunity to make a presentation to the Lodge AGM on 4 July 2014 to propose a freeze on the annual wage increase and a 12 month suspension of the regrading of positions. When given the opportunity he gave a lengthy PowerPoint presentation to the assembled employees. It was not until he had finished that Mr Giddings told him (in front of the meeting) that the employees had already passed a resolution rejecting his proposals. The thrust of Mr Green's evidence is that he expected that result and he was unconcerned, but I found that evidence implausible. In my view Mr Giddings showed a lack of respect to Mr Green in treating him in that manner and it is likely that Mr Green resented that treatment; and (b) Mr Giddings used the nickname "Sneaky Pete" at the terminal to describe Mr Green, and he told Mr Green about that nickname on one occasion. This is also likely to have caused feelings of resentment and perhaps anger. 465 Fifth, the evidence tends to show that Mr Green was determined not to allow Mr Giddings to be redeployed into other work within PKCT, whether through offers of voluntary redundancy or by reducing contractors. In my view there was no real difficulty for Mr Green in understanding that cl. 13.5 required PKCT to offer redeployment and voluntary redundancies before implementing forced redundancies but Mr Green was determined not to do so. Nor was there any real difficulty for Mr Green in understanding that the obligation to investigate all avenues to avoid forced redundancies, including by the reduction of contractors, required PKCT to make a greater effort than it did. His decision to only consider reducing contractors that were engaged on a full time and permanent basis (when none were) took a somewhat contrived approach to the Agreement. He must have understood that was not the intent of cl. 13.5.3. 466 The effect of Mr Green's approach to cl. 13.5 was to effectively guarantee that Mr Giddings' employment would be terminated upon the abolition of his position. In my view Mr Green was determined to ensure that the potentially available avenues for Mr Giddings' redeployment were given no proper consideration or closed off, most likely because he resented the power and influence Mr Giddings wielded through his Union roles and industrial activities and saw his continued employment as an impediment to necessary workplace changes. 467 I infer that Mr Green's substantial and operative reasons for terminating Mr Giddings' employment included his Union roles and/or his industrial activities. The Union made out its claim of accessorial liability under s 550 of the Act.

Relief 468 By agreement, the issue of relief was deferred except in relation to whether Mr Giddings, Mr Rosewarn and Ms Arber should be reinstated to their employment. 469 Pursuant to s 545(1) of the Act the Court has a broad discretion in relation to remedy. If satisfied that a person has contravened a civil remedy provision, it may make any order it considers appropriate. 470 In Independent Education Union v Geelong Grammar School [2000] FCA 557 at [34] Finkelstein J said that where an employee has been dismissed for a prohibited reason, in the ordinary case reinstatement is the appropriate remedy: see also Construction, Forestry, Mining and Energy Union v Pilbara Iron Company (Services) Pty Ltd (No. 3) [2012] FCA 697 at [186] and [190] (Katzmann J). I respectfully agree. I can see nothing in the circumstances to suggest that Mr Giddings' case should not be treated as an ordinary case. 471 Before making such an order it is appropriate to consider whether a satisfactory working relationship can be achieved. Mr Green (along with the senior managers) consistently said that he did not have an adverse view of Mr Giddings and he disavowed any difficulties in their working relationship. PKCT did not argue that that there had been any breakdown in the employer-employee relationship and did not contend that there would be any difficulty in resuming a working relationship if Mr Giddings was reinstated. There is no evidence that it will be difficult for PKCT and Mr Giddings to re-establish that relationship. The terminal is a large workplace, Mr Giddings has worked at the terminal for 34 years, and putting to one side the tensions that are likely to arise from his Union role, I expect the employer-employee relationship will satisfactorily resume. 472 Reinstatement is also appropriate for Mr Giddings because of PKCT's breaches of the Agreement. Primarily, I say this because PKCT breached its obligations to make use of voluntary redundancy before imposing forced redundancy and to investigate all avenues to avoid his forced redundancy including by reducing contractors. In my view it is likely that he would have been redeployed into other work at the terminal had PKCT complied with the Agreement. 473 Reinstatement is also appropriate for Mr Rosewarn because of PKCT's breaches of the Agreement. Again, I say this primarily because PKCT breached its obligations to make use of voluntary redundancy before imposing forced redundancy and to investigate all avenues to avoid his forced redundancy including by reducing contractors. In my view it is likely that he would have been redeployed into other work at the terminal had PKCT complied with the Agreement. PKCT did not submit that there would be any difficulty in re-establishing the employer-employee relationship if he was reinstated. 474 Mr Giddings and Mr Rosewarn should be immediately reinstated to employment with PKCT from the date of their termination and to the pay and other terms and conditions of their former positions. While there may be difficult issues associated with reinstatement of Mr Giddings and Mr Rosewarn to positions which have been abolished I am satisfied that reinstatement is appropriate. I will hear the parties about any issues that arise. 475 I do not consider that reinstatement is appropriate in Ms Arber's case. As I have said, I am not satisfied that PKCT breached its obligations under cl. 13.5 in her case. I am unable to know whether a different result might have ensued had PKCT complied with its obligation to consult, but I do not order reinstatement based upon its breaches in that regard.

Conclusion 476 I direct the parties to confer within seven days, and within 14 days file draft minutes of orders reflecting these reasons. The matter may be listed on short notice to deal with any issues that arise. 477 The parties are also directed to confer within seven days, and within 14 days file draft minutes of orders proposing a timetable for the filing of any evidence and submissions in relation to the other questions of relief. The timetable should include an order for the other questions of relief to be the subject of mediation before a Registrar of this Court. I certify that the preceding four hundred and seventy-seven (477) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Murphy.