Hollingsworth v Commissioner of Police No.2

Industrial Relations Commission (NSW)|2003-01-09|Before: Sams DP

CITATION : Neal and Shaw McDonald Pty Ltd and another [2003] NSWIRComm 298 APPLICANT: PARTIES : Toni Neal RESPONDENT: Shaw McDonald Pty Ltd FILE NUMBER: 607 of 2003 CORAM: Sams DP Termination of employment - unfair dismissal - restructure of law firm - redundancy of applicant - payments of redundancy pay - failure to consult - failure to give notice - failure to discuss alternative employment options - admissions of respondent - allegations of poor work performance - applicant's age and workers' compensation injury - length of service and loyalty - difficulties in finding alternative employment - principles of unfair redundancy. CATCHWORDS : Held, applicant's impressive employment history - genuine redundancy - respondent's failure to apply principles of consultation and notice - loyalty of employee - work performance never a consideration in the dismissal - performance issues not taken into account - consideration of age, length of service, injury and prospects for future employment - payment of minimum redundancy pay not relevant to unfairness of dismissal - redundancy pay directed towards different and discrete objectives - dismissal 'harsh and unjust' - reinstatement considered, but not practical - applicant's efforts to mitigate loss - compensation ordered - unacceptable language used in the workplace. LEGISLATION CITED : Industrial Relations Act 1996 Employment Protection Act 1982 Hollingsworth v Commissioner of Police No.2 (1999) 88 IR 282 Kenefick v Australian Submarine Corporation Pty Ltd (No 2) (1996) 65 IR 366 Lend Lease Investments Pty Ltd & Ors, Re Cannon & Ors (1986) 14 IR 301 Little v Commissioner of Police (No.2) [2002] NSWIRComm 52 McLaine v David Jones (Australia) Pty Ltd [1993] AILR 98 Outboard World v Muir (1993) 51 IR 167 CASES CITED : Quality Bakers of Australia Ltd v Goulding and Another (1995) 60 IR 327 Re Redundancy Awards (1994) 53 IR 419 Shop, Distributive and Allied Employees' Association, New South Wales and W D & H O Wills Holdings Ltd [2000] NSWIRComm 98

AWARDS: Clerical and Administrative Employees Legal Industry (State) Award 312 IG 703 HEARING DATES: 09/01/2003 DATE OF JUDGMENT: 09/22/2003

APPLICANT: Mr Robert Reitano of counsel RESPONDENT: LEGAL REPRESENTATIVES: Mr Andrew Ogborne of counsel SOLICITORS: Shaw McDonald Pty Ltd

JUDGMENT: - 20 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: SAMS DP 12 September 2003

TONI NEAL AND SHAW McDONALD PTY LTD AND ANOTHER Application by Toni Neal re unfair dismissal pursuant to section 84 of the Industrial Relations Act 1996

1 The applicant in this matter, Ms Toni Neal is a 56 year-old woman with an impressive employment history. During the 1970's the applicant worked in England as private secretary to Lord Denning and Lord Wilberforce. From 1978 to 1979 she was private secretary to the Indonesian Consul General in Sydney and from 1982 to 1995 she worked as a legal secretary for the partners of several large, well known Sydney law firms. From 1995 the applicant worked for Solicitor, Mr Geoffrey Meadows, first at MacMahon Drake Balding (1995 to 1998) then Bailey Meadows (1998 to 2001) and from 1 January 2002 for Shaw McDonald Pty Ltd (the respondent in the present proceedings).

2 The applicant and three other employees were dismissed on 30 January 2003 following a review undertaken by the respondent's Chief Executive, Mr Geoffrey Solomon and consequent restructure of the respondent's business. It is from that decision that the applicant lodged a claim for relief pursuant to s84 of the Industrial Relations Act, 1996 ('the Act') on 7 February 2003. Notwithstanding several attempts at settling the matter, it was listed for hearing on 1 September 2003. Directions in preparation for the arbitration were issued on 14 April 2003.

3 The applicant detailed her employment with MacMahon Drake Balding, where she worked for Mr Meadows from 1995 to 1998. She claimed she was responsible for running Mr Meadow's legal practice on a day-to-day basis. She regarded him as her mentor and best friend.

4 On 20 August 1998, Mr Meadows formed Bailey Meadows and the applicant transferred with him. She continued to work solely for Mr Meadows as a legal assistant. Her performance appraisals were excellent. During this time the applicant said she and Mr Meadows became close friends and, indeed Mr Meadows had told her that she was like one of the family. During a bout of illness in 1996 Mrs Irena Meadows had attended to the applicant's shopping and other needs.

5 In early December 2001, Mr Meadows informed the applicant of the merger of Bailey Meadows with Shaw McDonald. At the new firm the applicant was to work for Mr Meadows and Ms Shelly Johnson, another workers' compensation solicitor. In evidence, the applicant said Mr Meadows' work was always a priority as he was a partner and Ms Johnson was a junior solicitor.

6 The applicant responded to Ms Johnson's criticism concerning a delay with a file involving a doctor's report. This incident became the subject of email communication between Mr Meadows and Ms Johnson in October 2002. The applicant said she was never counselled about it. The issue had never been raised by Mr Meadows or mentioned during her performance appraisals.

7 In January 1998 the applicant had made a workers' compensation claim for injuries to her neck, back, arms and hands. During the office move in January 2002 the applicant exacerbated her back injury from bending and lifting files. She attended her General Practitioner who diagnosed her with an exacerbation of the LG/52 and proceeded to treat her with a medical microwave machine. She informed Mr Meadows of the situation. Bailey Meadows Services Pty Ltd was joined to the workers' compensation claim in late June 2002. On 9 or 10 of January 2003 Shaw McDonald Pty Ltd and Presfall Pty Ltd were joined as third respondents to the applicant's workers' compensation claim.

8 The applicant said that she did not get off to a good start with Shaw McDonald's Chief Executive, Mr Solomon. The applicant alleged that he had menaced and threatened her on her first day. For the next two months, he didn't even speak to her. She raised her concerns about Mr Solomon with Mr Meadows. However, he did nothing about it. A week before her birthday, Mr Solomon had called out to the applicant in the presence of other staff: "You can now retire, you'll be fifty five next week." She had felt very hurt and anguished by this comment. However, the applicant said she continued to be very busy with her work and during 2002 had billed Mr Meadow's clients for around $300,000.

9 Prior to going on annual leave in December 2002 Mr Meadows informed the applicant that the firm was to be reorganised. She said she was assured by Mr Meadows that she would remain working for him. She denied saying that she did not want to work for anyone else.

10 At about 5:00pm on 30 January 2003 Mr Meadows together with Mr Warwick Hart (another director), informed the applicant she was to be made redundant. The applicant said she was stunned and upset. When Mr Hart started to say something, she raised her hand and told him to be quiet. She was handed a retrenchment letter, payslip and cheque. While Mr Meadows kept talking, she repeated three times "what price loyalty?" Mr Meadows ignored the comment. The applicant said she then asked to be excused to contact her lawyer. Mr Meadows said "we want you to leave now." She cleaned out her desk, collected her property and left. When she arrived home she claims to have broken down and cried for the loss of her best friend and the job she loved. She believed she had been betrayed.

11 On termination the applicant received five weeks pay in lieu of notice ($4915.00), 20 weeks severance pay ($19,660.00) and an ex gratia payment of $424.00 taking the total to $25,000. The notice and severance pay was in accordance with the Clerical and Administrative Employees Legal Industry (State) Award 312 IG 703 ('the Award') and the Employment Protection Act 1982.

12 Notwithstanding these payments, the applicant believed her redundancy was unfair. She had been a long-standing employee. She had not been consulted and not asked to work part time or undertake training. The applicant gave oral evidence that, in order to remain in employment, she would have worked in another area, undertaken training or worked for someone else. She was willing to learn the work in new areas. Moreover, at all times, her performance appraisals had been excellent.

13 Despite numerous attempts to do so, the applicant has been unable to secure alternative employment. She believed this was because of her age (56 years) and her injury.

14 Ms Rachael Sutton, a solicitor with the firm Moray & Agnew, had worked for Bailey Meadows from May 1999 to March 2001. Her evidence dealt primarily with her observations of the applicant's work performance and relationship with Mr Meadows.

15 Ms Sutton had found the applicant to be helpful and co-operative and very efficient in managing the firm's files. Ms Sutton had observed that the applicant worked exclusively for Mr Meadows on personal injury litigation. She said it was obvious that the two of them were close friends and were very protective of one another in the office. The applicant would refer to Mr Meadows as the "maestro". She had observed Mr Meadows give presents to the applicant and take her out to lunch. She believed the applicant got on extremely well with Mr Meadows' wife.

16 Mr Geoffrey Michael Meadows is a director of the respondent. While he described the applicant's duties as those of a senior secretary, she did not run his practice and did not undertake the costing of files.

17 Mr Meadows said that the applicant's relationship with him and his wife was not one of a personal friendship. His help to the applicant was occasional and the relationship was professional. He had never guaranteed her ongoing employment.

18 Mr Meadows raised a number of issues concerning the applicant's performance. He said she: a. complained of having to work for other solicitors and was advised that she was required to work as directed. b. preferred to work on only defendant personal injury matters. c. consistently refused to, or avoided working on Ms Johnson's files. He had to direct the applicant to do the work and warned her on 17 October 2002 that her work on Ms Johnson's files was unsatisfactory. d. failed to keep his diary up to date. e. had difficulty adapting to new computer programs. f. failed to moderate her " noisy " behaviour in the office. g. was counselled on numerous occasions during 2002 that she must follow office procedures as directed.

19 None of these complaints were put in a document and given to the applicant. Ms Johnson's emails were never shown to the applicant. Mr Meadows however, said he had given her a formal verbal warning. Mr Meadows had given no consideration to retraining the applicant, because he believed she was reluctant to learn.

20 Mr Meadows gave evidence that at a Board meeting on 18 December 2002, it was decided that as part of a wider initiative to reduce costs and restructure the firm, a number of redundancies should be considered. The Chief Executive, Mr Solomon prepared a plan which involved redundancies of senior secretarial staff. The senior secretaries would be required to work for two or three solicitors and learn new areas of practice. He and Mr Solomon agreed that the applicant was a likely candidate for redundancy as it would not be possible to transfer her to other duties. A Board Meeting on 22 January 2003 confirmed Mr Solomon's recommendations.

21 Mr Meadows said sometime in the week commencing 16 December 2002, he advised the applicant of the proposal to restructure the firm. He agreed that he did not tell the applicant that she was being considered for redundancy. He told her there were no plans to transfer her to another solicitor or section. She had said, "remember I don't want to work for anyone else."

22 Mr Meadows said that when he and Mr Hart informed the applicant she was to be made redundant it was extremely difficult for all parties. The applicant did not wish to discuss her redundancy and sought to end the interview so as to consult a lawyer. He told her firmly, but not aggressively that she should pack her belongings and leave immediately. The applicant agreed to this. Mr Meadows acknowledges that the applicant couldn't say goodbye to her colleagues on that day. However, he said there was nothing to stop her ringing them the next day.

23 In cross-examination Mr Meadows made a number of admissions. I refer to the following extract from transcript: REITANO: Q. You do not deny as I understand your evidence that you did not at any time prior to 30 January 2003 consult with Ms Neal about her impending redundancy? A. No, I don't deny that. Q. Nor do you deny that you at any time prior to 30 January 2003 gave Ms Neal any notice of her impending redundancy? A. I don't deny that. Q. Nor is it the case you suggest anyone else gave her notice of her impending redundancy? A. I'm sure they didn't. Q. You do not suggest what happened on 30 January was "consultation" about her redundancy, do you? A. No. Q. At no time did you seek Ms Neal's view or views as to the prospect of her being made redundant? A. No. Q. Nor did you at any time tell Ms Neal on the basis of the material set out in your affidavit which I might describe as being critical of her work performance, that you would form a view that she rather than anyone else should be made redundant? A. Could I have that question again? Q. In exhibit A you concede you have made a number of criticisms of Ms Neal's work performance? A. Yes. Q. At no time do you tell Ms Neal selection for redundancy might be based on the kind of material that is contained in exhibit A? A. No, at no time. Q. In fact at no time did you tell her what criteria you would use to select her over anyone else for redundancy did you? A. No.

24 Mr Meadows said that while other employees were considered for redundancy, no employee was told why they had been selected for redundancy. These considerations had been kept secret from all employees. He said this was to protect the firm from other employees leaving.

25 In any event, Mr Meadows said that the applicant's services with MacMahon Drake Balding was counted for the purpose of calculating the applicant's redundancy benefits. However, he agreed the payment was the minimum standard under the Award. Further, the applicant had been offered outplacement services through an agency. Mr Meadows couldn't recall if it was he or Mr Hart who raised this matter. The applicant was distressed and didn't want to discuss anything, so it wasn't pursued. The offer of out-placement services was not mentioned in Mr Meadow's affidavit and was not referred to in the letter given to the applicant on 30 January 2003.

26 In cross-examination, Mr Meadows did not deny calling the applicant a "fucking slag" and a "fucking mole." He said he used these words "with people I have a strict work or professional relationship with."

27 Mr Meadows was taken to the applicant's performance appraisal in April 2002. He agreed there was no mention of the complaints made by Ms Johnson. However, he believed it was covered by the comment in the appraisal, that the applicant was not working as part of a team.

28 Mr Meadows said the main factor he took into account in choosing the applicant for redundancy was her inflexibility to work with other solicitors. In oral evidence, he said that of all the secretaries employed by the firm, only the applicant and Ms McPhee were doing the kind of work which was no longer necessary. Ms McPhee had been considered, but was not selected. The applicant's age wasn't a "weighty" factor in the decision. Mr Meadows didn't believe the applicant would find it difficult to find other work.

29 Mr Meadows gave evidence that the applicant's workers' compensation claim never affected their working relationship and played no part in the decision to make her redundant. It didn't bother him in the slightest; it was entirely irrelevant. Moreover, he couldn't see why the claim would bother a prospective employer.

30 As the respondent's Chief Executive, Mr Geoffrey Solomon is responsible for the general and strategic management of the business of the firm. Mr Solomon provided details of the respondent's financial difficulties during 2002. In early December 2002, he reported to the Board that the business was making a significant loss. He was instructed to carry out a review which would be discussed at a Board meeting on 22 January 2003.

31 On about 9 December, Mr Solomon said he was considering a number of employees for redundancy including the applicant. It was around the 10 or 12 January 2003 when the applicant was selected for redundancy. Mr Solomon did not believe it was appropriate to inform the applicant until the Board had made a final decision. He accepted that even when the decision was made (22 January) the applicant wasn't told until 30 January.

32 During the Christmas break, Mr Solomon held a number of discussions with the firm's directors about the poor financial performance of the Personal Injury Litigation Group and the need for structural changes in the firm. The financial accounts for the six months ending 31 December 2002 showed a further deterioration in the respondent's financial position. In the week ending 20 December 2002 and on 12 January 2003 he discussed with Mr Meadows the possible redundancy of the applicant.

33 In his report to the Board, dated 14 January 2003, Mr Solomon recommended that four employees be made redundant - an employed solicitor, a secretary, a junior and a word processing operator. Mr Solomon said that at the time he prepared his report he had no knowledge of the applicant's workers' compensation claim. He received the amended claim in a letter dated 10 January 2003 which was received in the office on the 13 or 14 January 2003. This was two or three days after he had made his decision to recommend the applicant's redundancy.

34 In selecting the applicant for redundancy, Mr Solomon took into account the analysis of the financial results and the restructure of a new Insurance and Litigation Group, meaning there would be too many senior secretaries for the amount of work generated. His decision was based on the best interests of the firm.

35 Mr Solomon also took account of the applicant's reluctance to work for other solicitors and doubted whether the applicant would fit into a combined practice group. He was aware of her age and level of expertise. He considered other alternatives, such as part time work and job sharing, but believed there were no suitable full time or part time positions. He did not discuss this with the applicant or anyone else. In cross examination Mr Solomon said: It would be correct for me to say that I had no reason to recommend her redundancy on the basis of her performance in the role in which she was employed by the company.

36 Mr Solomon did not believe the applicant was unfairly treated. He had taken no account of the applicant's workers' compensation claim. Mr Solomon believed he had a proper and quite harmonious working relationship with the applicant. His relationship with her had no bearing on his decision to recommend her redundancy. Mr Solomon said the Board unanimously accepted his recommendations on 22 January 2003.

37 Mr Solomon claimed that from his knowledge of the legal industry, it was not the practice to consult with staff or give notice of redundancies. He also considered that to consult or give notice would greatly disrupt other staff. It was decided to interview all four affected staff at the same time - after close of business on 30 January 2003.

38 Mr Solomon said that as a result of the restructure the respondent's financial losses had been reversed with no further redundancies. Since 30 January 2003 two or three administrative staff had left and been replaced.

39 In oral evidence Mr Solomon said it was his understanding that outplacement services through an agency called Moser Legal Support had been verbally offered to the applicant. He accepted this was not mentioned in the letter of termination. Mr Solomon said he had spoken to the agency and been informed that the market for senior legal secretaries was very good.

40 Mr Reitano referred the Commission to my decision in Shop, Distributive and Allied Employees' Association, New South Wales and W D & H O Wills Holdings Ltd [2000] NSWIRComm 98, wherein I discussed the principles which apply to unfair redundancies. He said the applicant here was not consulted about her redundancy; in fact the entire process was conducted in secrecy. She received no notice of her redundancy. No efforts were made to explore alternatives. Nothing was offered to a 55 year old woman with a workers' compensation claim and eight years' service. Redundancy payments were made at the very minimum. No outplacement services were offered and, even if they were, it was in an environment in which the applicant was extremely upset. She was not provided time off to seek alternative employment.

41 Mr Reitano rejected the ex post facto criticism of the applicant's performance that she was unwilling to work for other solicitors. Such criticism was irrelevant and even if it was a basis for her redundancy, the respondent failed to take account of the applicant's evidence that she was more than willing to explore other options, such as part time work or retraining. Further the respondent gave the applicant no opportunity to defend herself or justify being kept on, particularly having regard for her long-standing loyalty to Mr Meadows. See Kenefick v Australian Submarine Corporation Pty Ltd (No 2) (1996) 65 IR 366.

42 Mr Reitano submitted that the Commission could comfortably come to a conclusion that the applicant's dismissal was harsh, unjust and unreasonable and as such it warranted consideration of discretionary relief.

43 In relation to compensation, Mr Reitano said the Commission could consider the applicant's circumstances after dismissal at large. The Commission is not constrained by what the respondent paid to the applicant on termination. He stressed that the applicant has been unemployed due to her age and work injury. She had actively pursued alternative work without success.

44 Mr Reitano said that six months compensation was appropriate in this case having regard for five factors - the applicant's age and injury, length of service, her efforts to find alternative employment and poor prospects of obtaining alternative work.

45 Mr Ogborne submitted that it did not seem to be an issue that the applicant's position was genuinely redundant. The dismissal had nothing to do with her workers' compensation claim; as both Mr Meadows and Mr Solomon had said. The respondent was experiencing real financial losses and a restructure was essential. As a result there was an ongoing process of review culminating in Mr Solomon's recommendations to the Board. The choices for redundancy arose from the wind down in the personal injury area. It came down to either the applicant or Ms McPhee.

46 In response to the argument about lack of notice and consultation, Mr Ogborne put that it was the respondent's evidence that to have done so would have created mayhem in the office, with the possibility that employees the respondent wished to retain, might leave. These were hard decisions which had to be taken to preserve the overall business and the other employees.

47 Mr Ogborne put that, notwithstanding the lack of notice and consultation, a particular dismissal might not be found to be unfair. Consultation would not have changed the outcome. See McLaine v David Jones (Australia) Pty Ltd [1993] AILR 98.

48 As to the selection of the applicant, it came down to the employee who could best fit in. This wasn't a criticism of the applicant's work as a secretary. The evidence was however, that Mr Meadows did speak to the applicant about her unsatisfactory work for Ms Johnson and that this was a serious issue.

49 In any event, Mr Ogborne submitted that all relevant matters had been taken into account, such as the applicant's age, length of service and experience. It was difficult to demonstrate that any other decision would have been made, even if there had been consultation.

50 Mr Ogborne put that some weight should be given to the respondent's decision to count the applicant's service from 1995 for the purposes of calculating her redundancy entitlements. Further, the respondent did make an offer of outplacement services; albeit in a tense and difficult atmosphere. The applicant chose to immediately seek legal advice and no further communication was welcome by her.

51 Mr Ogborne rejected Mr Reitano's submissions on compensation. He said that given the redundancy was genuine, the selection process was appropriate, relevant redundancy payments were made and consultation would have changed nothing, the respondent cannot be held responsible for the fact that the applicant had been unable to find work for eight months. Therefore, no compensation should be awarded.

52 Mr Reitano rejected the analysis that even if there had been consultation the result would have been the same. He put simply - how would you know?

53 Mr Reitano said the selection for redundancy was never between two employees - the applicant and Ms McPhee. In any event, no evidence was brought as to the comparative worth of both employees. Further, he said that the criticism of the applicant for failing to complete Ms Johnson's files was never regarded as a disciplinary mater.

54 Mr Reitano put that the so called "gracious" act of including the applicant's service back to 1995 was never expressed as something the firm didn't have to do. It was not regarded as an ex gratia payment.

55 It seems to me that this matter can be conclusively determined by direct reference to the admissions in evidence of the respondent's witnesses. During the cross examination of Mr Meadows and Mr Solomon it was conceded that the applicant was not consulted or given any notice of her redundancy. That being so, it is axiomatic that there would have been no discussion with the applicant of alternative employment, or other options such as working part time or retraining. It was accepted that no calls for voluntary redundancies were made. Moreover, there appeared to be little, or no account taken of the applicant's long period of loyal service with Mr Meadows.

56 Further the applicant was not informed as to why she was selected for redundancy in preference to others and obviously had no opportunity to put her case in support of being retained. Even more alarming, when the applicant was told by Mr Meadows in December 2002 of the firm's restructure, he deliberately did not tell her that he and Mr Solomon already regarded her as a candidate for redundancy.

57 There can be no doubt that three other employees were made redundant at the same time as the applicant. They were also not told of their impending redundancy. The whole process was conducted in secrecy. Mr Meadows justified this by suggesting that it was to protect the firm from other employees leaving. This suggestion, it must be said, was nonsense. Mr Solomon gave evidence that from his knowledge of the legal industry, it was not the practice to consult with staff or give notice of redundancies. I don't know where he would have acquired this knowledge, but it most certainly isn't my understanding. It is completely at odds with the authorities of this Commission and contrary to good and decent industrial relations practice. The whole process was a classic example of how not to treat employees in redundancy situations.

58 In my opinion, the interview process was appallingly handled. The applicant was informed of her redundancy at 5:00pm, after other employees had left the office. This time was chosen so as to avoid disrupting other staff. Clearly the applicant was denied an opportunity to farewell her colleagues. Mr Meadows said she could have phoned the next day. This was a disingenuous and insensitive remark.

59 The unfortunate matters which I have just referred to, would lead the Commission to a conclusion in this matter which should surprise no one. I shall come to it shortly.

60 There was some ex post facto criticism by the respondent of the applicant's performance - no doubt in an effort to put some "flesh on the bones" of the decision to make her redundant. However, the evidence makes it abundantly clear that, at no time prior to the applicant's dismissal, was her performance ever cited as a reason for her redundancy. The documentary evidence, including her performance appraisals and Mr Solomon's oral testimony (See para 35) was unequivocal. The question of the applicant's work performance was never a consideration in her termination of employment.

61 Accordingly, I take no account of the respondent's allegations of poor work performance or lack of co-operation and, in any event, I seriously doubt whether there was any legitimate basis for such claims. It is to be observed that even if there was some basis for criticism, there was no evidence that the matters complained about were ever discussed with the applicant so that she could respond and defend herself. See Kenefick v Australian Submarine Corporation Pty Ltd (No 2).

62 The Commission would observe that it is not strictly necessary to determine whether the applicant's position was genuinely redundant. This is so because I regard the process of the applicant's termination of employment as being harsh and unjust. This finding is based on the well accepted authorities which have dealt with the principles relevant to unfairness in redundancy situations. In this regard, I refer to what I said in Shop, Distributive and Allied Employees' Association, New South Wales and W D & H O Wills Holdings Ltd: A body of well settled contemporary industrial principles has developed from these, and many other, authorities. They may be summarised as follows. In redundancy situations an employer is obliged to: 1. give reasonable notice to employees and/or their Unions; 2. adequately consult with employees and/or their Unions on the impact of the proposed changes;

explore genuine alternative options for redundancy, such as redeployment or relocation;

ensure such options are fairly offered to the affected employees;

provide reasonable standards of redundancy benefits;

provide appropriate ancillary services, such as time off to seek alternative work, retraining opportunities, outplacement services or financial planning;

ensure employees nominated for redundancy are fairly selected on an objective and unbiased basis. Notwithstanding the employer's obligations, there are certain reciprocal obligations on employees when confronted with genuine efforts by the employer to minimise the impact of potential redundancy. These obligations include: a) a willingness to participate in consultation with the employer;

b) genuinely participating in exploring alternatives to redundancy;

c) not unreasonably refusing to accept retraining, alternative employment, redeployment or relocation. A number of decisions of the Australian Industrial Relations Commission are pertinent to the employees' obligations. In Clothing & Allied Trades Union of Australia v Algray Pty Ltd (1989) 31 IR 365, Merriman C said: In considering all of the aspects of these two claims, the company seeks relief on the basis that neither former employee was actively seeking a commitment to employment or cooperating with the company as to future employment. The company's contention in this matter is supported by a decision of the Industrial Commission of SA in the matter of the Milk Processing and Cheese Manufacturing Etc (Appeal) case. In its decision the Full Commission said:

Like the Australian Commission, we agree that, if employment of a suitable nature and returning a comparable remuneration can no longer be found or is not arranged for by the employer, then it is appropriate to require special provision to be made. It goes without saying that any employee who unreasonably either declines such employment or fails to cooperate in mitigating any disadvantage in an appropriate manner can scarcely be heard to seek the same special treatment as those who do. I certainly support this decision that in a redundancy situation where the employer is genuinely attempting to find alternative employment an employee should cooperate in every way to accommodate the alternative employment efforts. See also Outboard World v Muir (1993) 51 IR 167, Kenefick v Australian Submarine Corporation Pty Ltd (No 2) and Quality Bakers of Australia Ltd v Goulding and Another (1995) 60 IR 327.

63 From my earlier discussion, it is plain that the respondent failed to meet its obligations under items 1, 2, 3, 4 and 6 of the matters identified in W D & H O Wills Holdings Ltd and I cannot be completely satisfied as to its bona fides in respect to item 7.

64 In addition, the Commission has had regard for two other matters which, in my estimation, exacerbated the "harshness" of the applicant's termination of employment.

65 Firstly, while there was some dispute as to whether the applicant and Mr Meadows were close friends, there can be no doubt that they enjoyed a close working relationship and friendship over seven and a half years. To be dismissed in such a perfunctory manner, without warning, must have come, not only as a complete shock to the applicant, but it must have deeply hurt and distressed her. I can well appreciate her sense of betrayal. Her repeated refrain during the termination meeting of "what price loyalty" was a perfectly understandable reaction. In these circumstances, it seems reasonable to assume, that it was unlikely she heard anything about offers of out placement assistance during the meeting. In any event, the respondent made no attempt to follow up this offer at some later point when the applicant presumably would have had time to calm down.

66 Secondly, the applicant is fifty six years old and has made numerous attempts to find alternative work. With due respect, I can well appreciate why she has had difficulty finding new employment.

67 For the reasons herein expressed, the Commission finds that the dismissal of the applicant on 30 January 2003 was harsh and unjust within the meaning of Pt 6 ch 2 of the Act.

68 The Commission acknowledges that the applicant received 20 weeks redundancy and 5 weeks pay in lieu of notice under the terms of the relevant Award. The total payout was topped up by $425.00 to round off the amount to $25,000. The respondent obviously asked the Commission to have regard to these payments when considering the amount of compensation, or any at all, that might be awarded to the applicant under s89(5) of the Act.

69 This submission invites the following observations.

70 Firstly, the amounts paid as redundancy reflect no more that the minimum standards for redundancy under the terms of the Award as determined by a test case of this Commission; see Re Redundancy Awards (1994) 53 IR 419.

71 Secondly, the relief available under Pt 6 ch 2 of the Act, arises from a finding of the Commission that a particular dismissal was unfair. The entitlement to redundancy pay arises from a totally different and discrete industrial objective, including compensation for the loss of non-transferable credits and the fact that a redundancy will usually have little, or nothing to do with an employee's performance or conduct. Put simply, a payment for one purpose should not as a matter of course, be offset against a payment for another purpose. See Lend Lease Investments Pty Ltd & Ors; Re Cannon & Ors (1986) 14 IR 301. I note that although this case dealt with offsetting superannuation against redundancy payments, the principle, in my view, is the same.

72 Thirdly, the payment of redundancy pay, even where it may be more generous than the minimum standards of this Commission, cannot offset a failure to observe the other obligations on the employer which arise in redundancy situations and to which I have earlier referred to in Shop, Distributive and Allied Employees' Association, New South Wales and W D & H O Wills Holdings Ltd.

73 In the ordinary course, this case would seem to me to be an obvious one in which orders should be made to reinstate the applicant. That relief is plainly the primary relief available under the unfair dismissal provisions of the Act. See Little v Commissioner of Police (No.2) [2002] NSWIRComm 52 at p 49. However, I have come to the view that reinstatement of the applicant would be impractical. See Hollingsworth v Commissioner of Police No2 (1999) 88 IR 282. I make this finding for the following reasons.

74 Putting aside whether the applicant's position no longer exists, reinstatement was not pressed by the applicant. The applicant's sense of betrayal was real and acute. Moreover, having regard for the past working relationship with Mr Meadows and the manner in which she was dismissed, I do not believe it would be in anyone's interest to restore the employment relationship.

75 Mr Reitano argued for the maximum compensation of six months available under s89(5) of the Act. He referred to the serious procedural flaws with the applicant's dismissal, her workers' compensation claim, her age, and the difficulty she had experienced in securing alternative employment, notwithstanding considerable efforts on her part (See Ex "4"). I should say that I found Mr Reitano's submissions on this matter to be persuasive.

76 Accordingly, while not agreeing to the maximum of six months, I propose to order a payment to the applicant of compensation for unfair dismissal of twenty weeks pay.

77 There is one final matter that I feel bound to comment upon. Mr Meadows gave evidence that he did not deny referring to the applicant, and indeed others with whom he had a professional relationship by such expressions as "you fucking mole" and "you fucking slag." For my own part, I was appalled by this evidence. To speak to anyone in such terms, let alone to someone who might be regarded as a friend or colleague, was disgusting. It was grossly offensive and completely unacceptable. Moreover, for such language to be used in the workplace by a partner in a law firm with an industrial relations practice, I found to be almost beyond belief.

78 Pursuant to s89(5) and (6) of the Industrial Relations Act 1996, the Commission orders that:- 1) The respondent, Shaw McDonald Pty Ltd shall pay to the applicant, Ms Toni Neal, an amount of $19,660.00 equivalent to twenty weeks pay at $983.00 per week. 2) The amount so ordered shall be paid within 21 days. 3) These proceedings are concluded.

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Judgment (92 paragraphs)

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