Fair Work Act 2009

Section 394 - Application for unfair dismissal remedy

Application for an unfair dismissal remedy - extension of time - whether genuine redundancy - discretionary considerations - no exceptional circumstances - application dismissed

[1] On 23 July 2020 Karen Anderson (Ms Anderson) lodged an application under section 394 of the Fair Work Act 2009 (the FW Act) in relation to the termination of her employment by Spirit WA Pty Ltd T/A Professionals Rockingham (Professionals Rockingham) which she says took effect on 8 April 2020.

[2] Ms Anderson's application was made eighty-five (85) days beyond 21 days from the date of dismissal. Ms Anderson provided the following explanation:

"The basis of my application for unfair dismissal is redundancy that isn't genuine. I have only been made aware as of yesterday being the 22nd of July that my position was given to another person which contradicts the reason for redundancy. [It] still needs the employee's job to be done by someone."

[3] On 23 July 2020 the matter was allocated to me to determine whether an extension of time should be granted. This decision deals only with that issue.

[4] I issued Directions on 24 July 2020. Information about an extension of time and factors the Commission is required to take into account were provided to the parties.

[5] Ms Anderson and Professionals Rockingham filed materials and witness statements in advance of the hearing.

[6] I heard the matter by telephone on 11 August 2020. Ms Anderson was self-represented. Professionals Rockingham was represented by Employsure Law, with permission. Both Ms Anderson and Mr Craig Small (director and licensee at the time of dismissal) gave sworn evidence.

[7] The evidence of both Ms Anderson and Mr Small was given respectfully, and few factual differences emerged.

[8] Following the hearing I reserved my decision. This decision determines the extension of time issue.

[9] Professionals Rockingham is a real estate and property management franchise operating in suburban Perth, Western Australia.

[10] Ms Anderson worked in the business in an administrative capacity from August 2018.[1] At the time of dismissal her primary administrative work was administering the property management trust account.

[11] Ms Anderson reported to a supervisor (Ms Kosovich) and through the supervisor to a director (Ms Berry).

[12] Due to trading circumstances largely brought on by the economic impact of COVID-19, Ms Anderson was made redundant on 3 April 2020.

[13] The preceding day, 2 April 2020, Mr Small telephoned Ms Anderson and advised that due to the economic impact of COVID-19 the company was considering making her position redundant. Ms Anderson indicated that she had been worrying about receiving such a call. She asked that the business consider whether there was other work available that she could perform from home (given the then COVID-19 work from home protocols). Mr Small indicated that he would discuss that aspect with Mr Berry. Mr Small called Ms Anderson again later that day and they agreed to meet the next day to discuss the matter. Mr Small sent a letter dated 2 April 2020 which said in part:[2]

"As discussed, we are presently considering a restructure of the area in which you work because of the business experiencing a downturn in finances.

In the circumstances, we confirm that we are considering making your role as Property Management Trust Administrator redundant.

As such, we would like to meet with you on 3 April 2020 at 2pm to discuss the potential redundancy and any suggestions you may have to avoid this, or any other matters that you would like to raise with us in respect of this proposal.

[14] Ms Anderson met with Mr Small in the afternoon of 3 April 2020. Mr Small advised that despite considering options and following discussions with Ms Berry, there were no redeployment options available and that sufficient administrative work did not exist to enable her job to be performed from home. He advised that her position was redundant and those of her duties that needed to be performed would be taken over by her supervisor. Ms Anderson expressed disappointment but understanding. She asked that her redundancy take effect prospectively, from 8 April. Mr Small agreed. He then outlined the terms of redundancy (two weeks in lieu of notice, four weeks redundancy pay and statutory entitlements).

[15] Later that day Mr Small sent Ms Anderson a letter confirming her redundancy and its terms. It said in part:[3]

"The Company confirms that your current role is no longer required due to the downturn in business caused by the coronavirus and whilst we have reviewed other areas within the business, unfortunately there are currently no vacancies or opportunities for redeployment...

"We are apologetic that we have had to make your role redundant due to these unprecedented circumstances that are out of our control."

[16] At that time, Ms Anderson had no cause to question the genuineness of the redundancy. Her employment came to an end on 8 April 2020.

[17] Over the next three months Ms Anderson remained of the view that her redundancy had been genuine.

[18] In the three months that followed, Ms Anderson kept in touch from time to time with employees with whom she had developed a friendship. One was Ms Amanda Armstrong. Ms Armstrong had worked in the business from time to time on a casual basis also doing administrative work.

[19] On 22 July 2020 Ms Anderson and Ms Armstrong exchanged over thirty friendly text messages throughout the day. Most were personal banter. Relevant text messages concerned the work Ms Armstrong was doing for the business from home:[4]

Ms Armstrong: "I'm working Monday - Friday 9 - 230 from HOME! Sharon is still at home so I dig my heals in and said well I am too :') I need to pop round for a cuppa and a bubba snuggle

Ms Anderson: Hey so are you doing trust accounting fulltime from home now?

Ms Armstrong: I'm sharing it with Kris and applications, RI's are all back to normal and I said I didn't want to do them

Ms Anderson: Yeah Ok. Guess she changed their rule about doing trust accounting from home

Ms Anderson: Don't you think that's really ratshit?"

Ms Armstrong: Working from home? Or trust from home? Didn't you do some trust from home?...Kris was doing it from home from memory

Ms Anderson: Nope I wasn't allowed to. All I did was the bond when you asked me to but that was just for you.

Being able to work from home but also making me redundant for restructuring purposes and pretty much giving my position to you. That's bordering on illegal...

Martina said their accountants advised that I shouldn't do trust from home because I'm not a qualified accountant which is why Kris could do it from home

That's actually such a kick in the guts. I'm not angry with you or anything but that's not right"

Ms Armstrong: I completely see where you are coming from, Kris still manages the trust role, I'm just doing the bank rec and applications, Kris manages planning and scheduling routines, is sorting all the council rates etc"

[20] On the basis of this text exchange Ms Anderson immediately developed a sense of grievance with her dismissal and considered that it was not genuine.

[21] The following morning, 23 July 2020, Ms Anderson researched her rights including logging onto the Commission's web site. She identified that an unfair dismissal claim could examine whether her redundancy was in fact genuine. She identified that she had 21 days from dismissal in which to make such a claim and also identified that the Commission had power to extend this time. She then and there decided she would make a claim.

[22] The application was filed on-line by Ms Anderson personally at 11.38am 23 July 2020.

[23] Section 394(3) of the FW act provides:

(a) within 21 days after the dismissal took effect; or

(b) within such further period as the FWC allows under subsection (3).

(3) The FWC may allow a further period for the application to be made by a person under subsection (1) if the FWC is satisfied that there are exceptional circumstances, taking into account:

(b) whether the person first became aware of the dismissal after it had taken effect; and

(c) any action taken by the person to dispute the dismissal; and

(d) prejudice to the employer (including prejudice caused by the delay); and

(f) fairness as between the person and other persons in a similar position."

[24] Ms Anderson's application can only proceed if she can establish that "exceptional circumstances" exist within the meaning of section 394(3).

[25] An applicant for an extension of time has an onus to adduce evidence in support of matters which that applicant asserts constitute exceptional circumstances.[5]

[26] The test of "exceptional circumstances" establishes a "high hurdle" for an applicant.[6] A decision whether to extend time under section 394(3) involves the exercise of a discretion.[7]

[27] I apply section 394(3) in the context of the Full Bench decision in Nulty v Blue Star Group Pty Ltd:

"[13] In summary, the expression "exceptional circumstances" has its ordinary meaning and requires consideration of all the circumstances. To be exceptional, circumstances must be out of the ordinary course, or unusual, or special, or uncommon but need not be unique, or unprecedented, or very rare. Circumstances will not be exceptional if they are regularly, or routinely, or normally encountered. Exceptional circumstances can include a single exceptional matter, a combination of exceptional factors or a combination of ordinary factors which, although individually of no particular significance, when taken together are seen as exceptional. It is not correct to construe "exceptional circumstances" as being only some unexpected occurrence, although frequently it will be. Nor is it correct to construe the plural "circumstances" as if it were only a singular occurrence, even though it can be a one off situation. The ordinary and natural meaning of "exceptional circumstances" includes a combination of factors which, when viewed together, may reasonably be seen as producing a situation which is out of the ordinary course, unusual, special or uncommon."[8]

[28] The principles of Nulty have recently been cited with approval by the Full Bench of the Commission in Tamu v Australia for UNHCR.[9]

[29] I now consider each of the factors in section 394(3).

[30] The reason for the delay in lodging an application is a factor that must be considered. The absence of an explanation for any part of the delay will usually weigh against an applicant in such an assessment. Similarly, a credible explanation for the entirety of the delay will usually weigh in an applicant's favour, though it is ultimately a question of degree and insight.[10]

[31] However, a reasonable explanation for the delay is not needed for the whole of the period of delay or may in fact not be required at all if the circumstances are otherwise exceptional.[11]

[32] The period of the delay requiring explanation is the period commencing immediately after the time for lodging an application has expired, ending on the day on which an application is ultimately lodged. That said, regard may be had to any circumstances from the date the dismissal took effect when assessing whether the explanation for the delay is acceptable or credible.[12]

[33] The 21-day statutory period after Ms Anderson's dismissal expired on 29 April 2020. Having filed her application on 23 July, it is eighty-five (85) days out of time.

[34] The time that elapsed from Ms Anderson's dismissal to lodgement can be divided into two distinct periods:

• firstly, the period from 8 April 2020 to 22 July 2020 when Ms Anderson first became aware that her redundancy may not have been genuine (a 105 day period of which 84 days are days of delay in filing); and

• secondly, the period between 22 and 23 July 2020 in which Ms Anderson was researching her position and making a claim (one day of delay).

The first period - first awareness that the redundancy may not be genuine

[35] Past decisions of the Commission (although each is decided on its own facts) have accepted that material facts known by a redundant employee only after the statutory time limit has expired may constitute exceptional circumstances warranting an extension of time.[13]

[36] In this case, Ms Anderson did not question the genuineness of her redundancy until her text exchange with an employee Ms Armstrong on 22 July.

[37] Ms Anderson was not in receipt of any information during this first period on which she could have otherwise formed a view that her dismissal may not have been a genuine redundancy.

[38] The conclusion reached by Ms Anderson that her job had been taken over by Ms Armstrong involved assumptions on her part.

The second period - decision to contest the dismissal

[39] It is apparent from the text exchange that Ms Anderson formed an instant view that her redundancy may not be genuine. She immediately relayed that view to Ms Armstrong in direct terms.

[40] After researching her rights the next morning, within 24 hours of these text messages, Ms Anderson filed proceedings in the Commission.

[41] The immediacy in taking action once information triggering a sense of grievance about her redundancy was known weighs in favour of granting an extension of time.

[42] However, for that to be an acceptable explanation for delay the information gleaned needs to have given rise to a sense of grievance that was reasonably based. An irrationally formed sense of grievance cannot form an acceptable reason for delay.

[43] Ms Anderson's view was based on the assumption that Ms Armstrong was doing her job including trust account work from home (which she says she was advised could not be done and which was a view she believed had precipitated her redundancy). This view was not modified when Ms Armstrong retorted "Kris still manages the trust role, I'm just doing the bank rec and applications, Kris manages planning and scheduling routines, is sorting all the council rates etc".

[44] The information Ms Anderson ascertained on 22 July 2020 established a belief that her redundancy may not have been genuine but was not necessarily one reasonably held.

[45] These conclusions weigh somewhat in favour of a finding of exceptional circumstances.

Awareness of the dismissal taking effect (section 394(3)(b))

[46] Ms Anderson was aware after the meeting with Mr Small on 3 April 2020 that she was being made redundant. The date redundancy took effect (8 April) was a negotiated and agreed date.

[47] In the circumstances where Ms Anderson's case is that she did not discover information leading to her belief that her redundancy was not genuine until approximately four months after termination, awareness of the dismissal date has less relevance than a dismissal for cause.

[48] This is a neutral consideration.

Action taken to dispute dismissal (section 394(3)(c))

[49] Ms Anderson did not initially question the genuineness of her dismissal. Nor did she communicate with the employer on such issues for three and a half months. She cannot be criticised for that; she had no information on which to conclude otherwise. She accepted the employer at its word and on business conditions at the time.

[50] This is a neutral consideration.

[51] As a general principle, an employer is entitled to arrange its affairs and organise its resources on the basis that claims can no longer be made beyond the lodgement period, except in exceptional circumstances.

[52] However, there is no particular prejudice to Professionals Rockingham should the time for lodgement be extended. Professionals Rockingham has lodged a detailed response and is represented by a firm specialising in such matters. A potential witness (Ms Anderson's supervisor at the time, Ms Kosovich) has left the business since the dismissal. That notwithstanding, it is unlikely the employer has been or will be unduly prejudiced should an extension be granted.

[53] Nonetheless, it is a principle well established by the Commission that the mere absence of prejudice is an insufficient basis to grant an extension.[14]

[54] In the circumstances of this matter, this consideration is a neutral factor.

[55] A hearing on merit will necessarily concern the employer's jurisdictional objection that Ms Anderson's termination was a genuine redundancy. The matter concerns no other suggestion of performance or misconduct issues.

[56] Section 389 of the FW Act provides:

(1) A person's dismissal was a case of genuine redundancy if:

(a) the person's employer no longer required the person's job to be performed by anyone because of changes in the operational requirements of the employer's enterprise; and

(b) the employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.

(2) A person's dismissal was not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within:

(b) the enterprise of an associated entity of the employer."

[57] Without having conducted a merit hearing I make no concluded findings on the jurisdictional challenge by Professionals Rockingham. However, on the limited evidence before me, my provisional view is that Ms Anderson's case on merit is not strong.

[58] There was a period of consultation, albeit limited. The nature of the statutory consultation obligation bears a relationship to context including COVID-19 circumstances.[15] These factors, taken together, may point to the consultation having been adequate.

[59] Redeployment options were examined and discussed but the employer did not consider that other alternatives existed. Nothing so far before me suggests otherwise. In a business of relatively small scale (32 employees) and in the midst of the uncertainty attendant to a health pandemic impacting real estate markets this may not have been surprising.

[60] The crux of Ms Anderson's case is that her duties were still required to be performed and were in fact being performed by Ms Armstrong. For this argument to succeed the Commission would need to be satisfied that Ms Armstrong or some other person was performing Ms Anderson's job.[16]

[61] Two immediate difficulties arise with this proposition, even on the limited material before me.

[62] Firstly, Ms Anderson's job was as a full time employee. Ms Armstrong is a casual employee who commonly worked less than a full week. The contracted nature of the positions are not the same.

[63] Secondly, Mr Small's evidence was that Ms Anderson's supervisor (Ms Kosovich) had taken much of Ms Andersons's tasks and on-delegated some of them to Ms Armstrong. His evidence was that Ms Anderson's position no longer exists but other staff perform (for example) necessary trust account duties. Ms Armstrong's retort by text also suggested the duties had been divided amongst others, including herself. Whilst Ms Anderson assumed otherwise and believed her job still existed, it is a well-established principle that a position can be genuinely redundant even though the duties of that position do not entirely disappear and remain performed by others in the business.[17] Given regulatory controls on trust accounts, it is not surprising that trust account duties in a real estate agency will be continued to be performed beyond an employee's redundancy. Further, whilst Ms Anderson was not permitted to do certain tasks from home that others may now be permitted to do, this does not necessarily point to her job not having been made redundant.

[64] To the extent relevant, section 394(3)(e) does not require more than a provisional view on merit to be formed.[18] It is my provisional view that the merits of Ms Anderson's claim are not strong.

[65] This factor weighs against granting an extension of time.

Fairness between persons in similar position (section 394(f))

[66] No evidence or submissions from Ms Anderson or Professionals Rockingham raise issues of fairness with and between other persons.

[67] In these circumstances, this is not a relevant factor.

[68] Ms Anderson's application was filed 106 days after the dismissal took effect. It is 85 days out of time.

[69] The strongest factor weighing in favour of granting an extension is that Ms Anderson formed an instant sense of grievance on 22 July 2020 and acted very promptly once that view was formed. I have concluded that the explanation for the delay is understandable but not necessarily reasonably formed. My provisional view on the limited material before me is that the merit of Ms Anderson's case is not strong. These factors tend to cancel each other out.

[70] I have not found any other factor in section 394(3) to weigh in Ms Anderson's favour.

[71] On balance, considering the length of the delay and other relevant factors (including the "high hurdle" set by the statutory provision), I do not consider that exceptional circumstances exist. An employee made redundant forming a view more than three months after dismissal based on limited information that her redundancy may not be genuine in circumstances where the employer appears to have distributed her duties amongst other employees is insufficient to constitute exceptional circumstances.

[72] There being no exceptional circumstances the time for lodging the claim cannot be extended.

[73] As Ms Anderson's application is out of time and as the time for lodgement has not been extended, I am unable to proceed with the jurisdictional objection or conduct a merits hearing. The application is dismissed. An order[19] to that effect is issued in conjunction with the publication of this decision.

Mr C Cooper, Employsure Law Pty Ltd, with permission, for Spirit WA Pty Ltd T/A Professionals Rockingham

[1] Employment Contract as varied in 2019 R4

[4] Text messages as relied upon by Ms Anderson

[5] Smith v Canning Division of General Practice [2009] AIRC 959

[6] Lombardo v Commonwealth of Australia as represented by the Department of Education, Employment and Workplace Relations [2014] FWCFB 2288 at [21]

[7] Halls v AR & MA McCardle & Sons Pty Ltd and Ors [2014] FCCA 316

[8] [2011] FWAFB 975 at [13]. See also Cheval Properties Pty Ltd t/as Penrith Hotel Motel v Smithers [2010] FWAFB 7251 at [5]

[9] [2019] FWCFB 2384 at [16] - [20]

[10] Stogiannidis v Victorian Frozen Foods Distributors Pty Ltd t/as Richmond Oysters [2019] FWCFB 3288 at [35]- [45]

[11] Stogiannidis (Ibid); Elliott v LEAP Legal Software Pty Ltd t/a LEAP Legal Software [2018] FWCFB 3288

[12] Shaw v Australia and New Zealand Banking Group Limited [2015] FWCFB 287 at [12]; Ozsoy v Monstamac Industries Pty Ltd [2014] FWCFB 2149 at [31] - [33]; Perry v Rio Tinto Shipping Pty Ltd T/A Rio Tinto Marine [2016] FWCFB 6963; Czoy v Monstamac Industries Pty Ltd [2014] FWCFB 2149

[13] John Byrnes v Rexel Electrical Supplies Pty Ltd [2015] FWC 5776; McMechan v National Roads and Motorists' Association [2016] FWC 5826; Williams v The Building Connection Group Pty Ltd [2017] FWC 30

[14] Brodie-Hanns v MTV Publishing Ltd (1995) 67 IR 298 at 299-300

[15] See for example: Brackman v Dressed 4 Success Pty Ltd [2020] FWC 2770 at [24] per Gostencnik DP

[16] Dale v Marky Industries Pty Ltd [2019] FWC 8446 at [66]

[17] Dibb v Commissioner of Taxation [2004] FCAFC 126 at [43] - [44]; Kekeris v A Hartrodt Australia Pty Ltd [2010] FWA 674 at [27]

[18] Kyvelos v Champion Socks Pty Ltd AIRCFB 10 November 2000 Print T2421 at [14]

[19] PR722145

Printed by authority of the Commonwealth Government Printer