Penrith Aquatic and Leisure Ltd T/A Ripples Leisure Centre [2020] FWC 1356 | Case summary

What happened

Penrith Aquatic and Leisure Ltd, trading as Ripples Leisure Centre, had operated the Ripples Leisure Centre, Ripples Hydrotherapy Centre and Ripples Penrith under an arrangement with Penrith City Council. On 24 June 2019, Ripples and Council agreed not to renew the service agreement. The assets returned to Council management, and the affected employees' employment with Ripples came to an end as their roles were made redundant [14], [24].

Ripples applied to the Fair Work Commission under s.120 of the Fair Work Act 2009 (Cth), seeking to reduce to nil the redundancy pay otherwise payable to 19 employees. Its case was that it had obtained “other acceptable employment” for them with Council [1]-[2]. Ripples described steps including advocating for the employees as candidates, helping Council make employment decisions, arranging paid time for meetings and interviews, and securing recognition of service and accrued leave [6]. The Commission made findings about the transition process and those steps, including that Council offers recognised continuity of service and leave balances [14].

The matter was decided on the filed materials after Ripples and Ms Gallagher consented to that procedure. The hearing was vacated [4]. The 18 matters C2020/108-C2020/125 were uncontested. The Commission reduced those employees' redundancy entitlements to nil [15]-[17].

Ms Gallagher's matter, C2020/126, was contested. She had been a permanent part-time Gym Instructor, usually working 20 hours per week. Council offered her a permanent part-time Gym Instructor role for 10 hours per week. The roles had several features in common, but the weekly hours were halved [18], [30]. Ms Gallagher accepted the offer before starting work. She later raised concerns about the reduced hours and the transition process [20], [22]. The Commission found that the evidence did not establish that she had made herself unavailable for additional hours [31].

The decision therefore has two outcomes rather than one. For the 18 uncontested employees, the reduction was 100%, leaving no redundancy payment under the Commission's orders. For Ms Gallagher, the Council role was not other acceptable employment, but the Commission reduced her redundancy entitlement by 50% under its statutory discretion [32]-[36].

Why the court decided this way

The decision applies the conditions in s.120 in sequence. First, the employee must be entitled to redundancy pay under s.119. The judgment notes that the power to reduce redundancy pay is only enlivened if that underlying entitlement exists, referring to the Full Bench decision in Maritime Union of Australia v FBIS International Protective Services (Australia) Pty Ltd [2014] FWCFB 6737 [10]. In Ms Gallagher's case, it was common ground that her Ripples employment ended because her position was made redundant. The Commission accordingly found the s.119 entitlement condition satisfied [24]-[25].

Second, the employer must have obtained other employment. The parties agreed that Ripples obtained the Council Gym Instructor role for Ms Gallagher, so the Commission treated that part of s.120(1)(b)(i) as established [26]-[27]. This did not decide the separate question of whether the role was acceptable.

Third, the Commission assessed acceptability objectively. It said Ms Gallagher's acceptance of the offer did not make it acceptable, just as an employee's personal view would not determine that question [28]. It also rejected a requirement that the old and new jobs be identical [29]. That approach reflects the authorities discussed in the decision, including the objective test and the possibility that acceptable alternative employment may have some differences from the former role [12]-[13].

The Commission then compared the roles across a range of features. The Council job offered a better hourly rate. Classification, location, job security, continuity of service, accrued entitlements, seniority, qualifications, skills and experience were treated as the same or maintained. But weekly hours fell from 20 to 10 [30]. The Commission accepted that Ms Gallagher could be dissatisfied with that reduction and specifically found that the evidence did not show she had made herself unavailable for extra hours [31]. It concluded that the Council job “only went half way” towards meeting her former position and was not acceptable alternative employment [32].

The decision did not stop at that finding. Section 120(2) gives the Commission discretion to specify a reduced amount, and the Commission explained that a finding that employment was not entirely acceptable does not automatically mean the full redundancy amount must be paid [33]. It treated the hours difference as significant and set the reduction at 50% [34]-[35]. The decision does not provide a general formula for converting differences in hours into a percentage reduction. Its stated reason for this figure is the particular difference between the roles in this case.

For the 18 uncontested employees, the Commission found that Ripples had taken proactive steps to obtain alternative employment, and that the employees accepted and commenced the Council roles [15]. In light of those findings, it reduced their entitlements to nil [16]. The decision does not detail a separate role-by-role comparison for each of those employees in the same way it does for Ms Gallagher.

Before and after state of the law

The judgment presents s.120 as a discretionary mechanism for reducing an existing redundancy entitlement, not as a rule that automatically removes the entitlement whenever another job is offered. The statutory starting point is s.119, which sets out the relevant redundancy entitlement, subject to the Act's exceptions and related provisions described at [7]-[9]. Section 120 then permits a reduction where the employer obtains other acceptable employment or cannot pay the amount [9].

Before applying that provision, the Commission drew on earlier decisions concerning “acceptable employment”. The authorities summarised at [12] identify an objective assessment, with factors that may include pay, hours, location, seniority, benefits, workload, job security, continuity of service and accrued benefits. The list is not exhaustive, and the relevance or weight of a factor depends on the employee's circumstances. The Commission adopted that approach and treated the Agreement's phrase “acceptable alternative employment” as having the same meaning as “other acceptable employment” in s.120 [13].

This decision applies those principles to a concrete hours reduction. It shows that substantial similarities in other features do not necessarily overcome a significant reduction in weekly hours. It also confirms that accepting a position is not conclusive proof that it was objectively acceptable [28], [30]-[32]. Conversely, a conclusion that the role was not acceptable did not compel full payment: the Commission separately exercised the s.120(2) discretion and reduced Ms Gallagher's amount [33]-[35].

The judgment does not purport to replace the earlier authorities or establish a universal percentage scale for changes in work hours. Its application is tied to the factual comparison it made. Nor does the decision state that every reduction in hours makes alternative employment unacceptable. The point supported by the reasons is narrower: in Ms Gallagher's circumstances, a reduction from 20 to 10 hours, without evidence that she had made herself unavailable for additional hours, was substantial enough to make the offered role unacceptable, while still permitting a partial reduction in redundancy pay.

Key passages with plain-English translation

At [13], Commissioner Johns says the Agreement's wording should be treated as having the same meaning as the Act's phrase “other acceptable employment”. In practical terms, the Commission used the same legal test to assess the Agreement-based redundancy claim and the s.120 application.

At [28], the Commission says an objective test must be applied. Plainly, neither Ms Gallagher's acceptance nor her dissatisfaction determined the legal question. The relevant comparison was between the jobs and their conditions, assessed objectively.

At [29], the Commission states that the new and former roles did not have to be identical. This meant the analysis could account for a role that was similar overall while differing in particular features.

At [30], the Commission records its comparison: a better hourly rate, the same classification and location, maintained continuity and accrued entitlements, and similarities in security, seniority, qualifications, skills and experience. The major difference was hours, falling from 20 to 10 per week.

At [31], the Commission says Ms Gallagher was entitled to be dissatisfied about the hours and that the evidence did not show she had made herself unavailable for more. This mattered because it prevented the hours shortfall from being treated as a consequence of her own lack of availability.

At [32], the Commission concludes that the 10-hour Council job was not acceptable alternative employment. Its explanation was that the offer met only half of the former 20-hour position.

At [33]-[35], the Commission separates acceptability from the remedy. Even though the job was not acceptable, the Commission was not required to leave the redundancy amount untouched. It used its discretion to reduce the amount by 50%.

What fact patterns trigger this precedent

The decision is most relevant where an employer seeks to reduce redundancy pay under s.120 because it arranged employment with another employer. It indicates that the analysis involves at least three distinct questions: whether the employee has a s.119 redundancy entitlement, whether the former employer obtained the alternative employment, and whether the employment is objectively acceptable [25]-[28].

The decision is particularly informative where the new job resembles the former job in many respects but materially reduces hours. The Commission considered the hourly rate, classification, location, job security, continuity, accrued entitlements, seniority, qualifications, skills and experience, as well as hours [30]. In this case, the reduction in hours was decisive to the acceptability assessment despite the other similarities [31]-[32].

It also bears on situations where an employee accepted an offer but later disputes whether it was acceptable. The Commission's analysis makes clear that acceptance is not the legal test [28]. The decision also highlights the relevance of evidence about whether reduced hours resulted from the employee's availability or preferences: the Commission expressly found no evidentiary basis to say Ms Gallagher had made herself unavailable for additional hours [31].

Finally, it may be relevant where the employer argues that any finding of unacceptable employment means full redundancy pay must follow. The decision rejects an automatic link between those findings and the amount payable, because s.120(2) retains a discretion to set a reduced amount [33]-[35]. The decision does not establish that a 50% reduction is generally appropriate whenever hours are halved.

How later courts have treated it

The supplied judgment contains no later decisions discussing or applying Penrith Aquatic and Leisure Ltd T/A Ripples Leisure Centre [2020] FWC 1356. Its treatment by later courts or Commission members therefore cannot be established from the material provided.

Within this decision, Commissioner Johns relies on earlier authorities for the objective acceptability test and the relevant factors [12]-[13]. The judgment refers to FBIS in explaining the need for an underlying s.119 entitlement and the applicable framework [10], [23]. It also adopts the approach summarised in Spotless Services Australia Limited t/as Alliance Catering [2016] FWC 4505 [12]-[13]. The judgment's own contribution is its application of those principles to Ms Gallagher's reduction in hours and its separate exercise of discretion over the amount of redundancy pay [30]-[35].

Still-open questions

The decision does not explain how the 50% figure was calculated beyond identifying the reduction from 20 weekly hours to 10 as significant [30]-[35]. It does not set out a general method for weighing hours against pay, location, continuity or other features, and it should not be read as creating a fixed mathematical test.

The reasons also do not provide detailed individual comparisons for the 18 uncontested employees. They record that Ripples took proactive steps and that the employees accepted and commenced the Council positions, then reduce their redundancy entitlements to nil [15]-[17]. The judgment does not specify how every potentially relevant factor applied to each person's new role.

The decision identifies the objective and individualised nature of the test, but does not determine how particular personal circumstances, such as caring responsibilities or travel impacts, would affect the assessment in another case. Those matters appear among factors discussed in the cited authorities at [12], but the Commission did not need to resolve them on the facts before it.

This is general legal information, not legal advice. Zoe can make mistakes. Before acting on this, relying on it, or using any draft, get a qualified Australian lawyer to check it.

Judgment (85 paragraphs)

[1]

The Applicant submits they took pro-active steps to obtain alternative employment for the redundant Respondents and was a 'strong moving force' towards the creation of alternative employment opportunities for the Respondents.
In Australian Chamber of Manufactures v Derole Nominees Pty Ltd[16] (Derole) at 123 it was held,

[2]

"the test to be applied to determine whether employment is acceptable within the meaning of the clause is an objective one."

[3]

To determine whether the employment has been obtained on the employees' behalf, consideration must be had to the Applicant's actions: Derole_[17]_ _(_at 127):

[4]

"The word "obtains" does not appear in its context to mean actually obtain in the fullest sense possible. In circumstances like those occurring at the company one employer is incapable in law of effecting a contract of employment between his employee and another employer whether by assignment or otherwise; the creation of the legal relationship of master and servant depends on a mutuality being arrived at between the individual and the incoming employer. Therefore, the pursuit of alternative employment by the outgoing employer cannot be expected, by reason of itself alone, to produce new employment; there will usually and perhaps always remain the opportunity for the incoming employer, and the employee, to disagree as to matters such as terms of employment, suitability of the job to the employee and vice versa so that alternative employment may not eventuate.

[5]

It follows that "obtain" must be given some lesser meaning. The Shorter Oxford Dictionary (3rd ed, revised) provides as its relevant meaning, the definition of "obtain" as "to procure or gain, as the result of purpose and effort". It seems to us that meaning is of assistance here; that is, the employer by purpose and effort may establish an opportunity which suits the employee and which crystallises as alternative employment of an acceptable kind."

[6]

"it will be seen that the intention is not to impose an absolute test on the employer's ability to "obtain" alternative employment but rather it refers to action which causes acceptable alternative employment to become available to the redundant employee. The employer must be a strong, moving force towards the creation of the available opportunity."

[7]

In Datacom Systems Vic Pty Ltd v Khan_[19]_, at paragraph [12], Vice President Lawler expressed the view that the word "obtains" in the context of section 120 should be given a very broad interpretation.

[8]

17 In Allman v Teletech International Pty Ltd,[20] at [419]:

[9]

"The encouragement and facilitation of a process is not the same as doing everything possible to ensure a result. Arranging alternative employment means bringing about that employment should the employee choose to accept it."

[10]

In Maritime Union of Australia v FBIS International Protective Services (Aust) Pty Ltd,[21] (FBIS) the Commission found that the employer had not done enough to invoke the application of section 120, as providing the new employer with two lists of employees and their contact details at paragraph [49]:

[11]

"simply facilitated an invitation by ACG to [FBIS's] employees to apply for a position and undertake an interview" and "did no more than to secure the employees an opportunity to enter the recruitment process of ACG which may or may not have resulted in an offer of employment".

[12]

Serco Sodexo Defence Services Pty Ltd (SSDS),[22] which was in line with FBIS, confirmed that the test is whether the actions of the employer are a "strong moving force" towards the job offer being made, and Commissioner Roe stated at paragraph 9 there must be a:

[13]

"causal connection between the purpose and effort of the employer and the gaining of employment or an offer of employment, by the employee. The actions required to establish the necessary degree of causation will vary depending on the circumstances."

[14]

Applying these principles to the present case, the Applicant submits they were 'a strong moving force' and took pro-active steps to provide alternative employment to the Respondents. Prior to the transfer of management, the positive steps taken by the Applicant included:
- (a) advocating to the Council that the Respondents were, having regard to past performance, a suitable pool of candidates from which to fill the positions created as a result of the Return of Assets;
- (b) providing information to the Council and cooperating with the Council to facilitate its decision-making process regarding the offer of employment made to the Respondents;
- (c) affording the Respondents the opportunity during paid work hours to meet with the Council in order to discuss available employment offers;
- (d) meeting with the Respondents to provide information and discuss the transition of management;
- (e) affording continuity of service and recognising all accrued leave balances which are not paid out on the cessation of employment with the Applicant; and
- (f) reaching an agreement with Council that a key consideration of the Return of the Assets was a willingness of the Council to offer employment to the Employees.
Between 7 August 2019 - 22 August 2019, the Applicant sent letters signed by Wayne Mitchell (Acting Chair Person Board of Directors of the Applicant) to each Respondent confirming that the transfer of management of the Applicant to Council was anticipated to come into effect on 26 August 2019 and advising an offer of alternative employment would be made (Transfer of Management letter) A copy of the Transfer of Management letter forms part of Annexure C to the Application.
The Applicant submits that employment with Council was obtained prior to the Respondents' redundancy taking effect. From 7 August 2019 - 23 August 2019, an offer of alternative employment letter was sent to each of the Respondents. The offers afforded the Respondents continuity of service and recognised all accrued leave balances that were not paid out to Respondents by the Applicant.
The suitable alternative roles were based on the Respondents current role type, duties and responsibilities and with a full-time equivalent salary. A copy of the alternative employment letters is annexed to the Statement of Peta Basso.

[15]

The Applicant submits that they obtained acceptable alternative employment for each of the Respondents. These matters are canvassed in Annexure A and Annexure B of the Application. The Applicant submits that the alternative employment was accepted by all of the Respondents.
In Clothing and Allied Trade Unions of Australia v Hot Tuna Pty Ltd[23] (Hot Tuna) the Full Bench stated that at 230 - 231:

[16]

"...the test of acceptability of the alternative employment is an objective one involving a consideration of such matters as pay levels, hours of work, seniority, fringe benefits, workload and speed, job security and other matters."

[17]

Similarly, in National Union of Workers v Linfox Australia Pty Ltd,[24] Vice President Watson considered the following criteria:
- (a) the employee's skills, experience and physical capacity;
- (b) the rates of pay, hours of work, duties and conditions of employment associated with the proposed job;
- (c) whether or not continuity of employment is provided to the employee;
- (d) the extent of any additional travel distances from home to the new place of work and whether the employee has to substantially alter their method of travelling to and from work in order to attend to duty; and
- (e) the level of any compensation.
The question of what constitutes 'other acceptable employment' in the context of section 120(1)(b) of the FW Act was summarised by Deputy President Sams' in Spotless Services Australia Ltd[25] at [65] as follows_:_
- (a) The test of what constitutes 'acceptable employment' is an objective one. It does not mean it must be acceptable to the employee.
- (b) Acceptable employment' is not identical employment, as no two jobs could be exactly the same.
- (c) An employee must meaningfully cooperate with the employer in exploring or considering options for alternative positions.
- (d) An employee's prima facie entitlement to redundancy pay may be at risk if the employee refuses a role or position, which is found to be objectively 'acceptable'
Consideration should be given to the decision of Datamars (Australia) Pty Ltd T/A Datamars,[26] at 52:

[18]

"[t]here is no requirement that an alternative position in order to be acceptable must slavishly replicate every term and condition of the prior position...[s]ome features of the alternative position may well be inferior to the prior position, with the alternative position manifesting some compensating or offsetting benefits of another kind".

[19]

29 At paragraph [25] in Derole_[27]_ it was stated:

[20]

"An acceptable alternative role does not mean the same employment, clearly. But equally, on an objective assessment, the position must be within a range of tolerance as well."

[21]

In applying the test set out above in Hot Tuna_[28]_, the totality of the circumstances affecting the Respondents indicate that (except for two Respondents) these offered positions stipulate similar pay levels, hours of work, seniority, workload and job security.

[22]

(a) the position offered to Emma Gallagher, which involves a reduction in hours at the request of Ms Gallagher, and

(b) the offer made to Lynette Wooden shows a 5-hour reduction in hours to accommodate Ms Wooden's request not to work weekends.

[23]

As explained by Watson SDP in Feltex Australia Pty Ltd v Textile, Clothing and Footwear Union of Australia[29] at [89]:

[24]

"...acceptable alternative employment is not necessarily identical employment and that the AIRC has previously found alternative employment to be acceptable notwithstanding inconvenience to employees and some detrimental alteration to the terms and conditions of employment."

[25]

The list of relevant matters is not exhaustive, the subsequent Full Bench in Australian Chamber of Manufactures v Derole Nominees Pty Ltd[30] added "location" to this list of relevant considerations. The acceptable employment remains within the Assets, that is, at the same work location as the employment with the Applicant.
The Applicant further submits, that similarities can be drawn between the present case and The ORS Group Pty Ltd T/A The ORS Group [2018] FWC 4809, where Ms Zhang, employed as an Employment Consultant by ORS and offered an alternative role with APM with the same position and title. The Commission held that on balance it was satisfied that the offer of employment was "acceptable":

[26]

[37] The other employment at APM was a similar role to Ms Zhang's previous position with ORS. She would continue to be employed as an Employment Consultant however her client caseload rather than being only DMS (Disability Management Services) would be both DMS and ESS (Employment Support Services). The location where she would work was the same. The annual salary she would be paid was the same. Both positions were full-time. There would be no loss of leave accruals, these would be carried over to APM and honoured by her new employer. Her length of service with ORS was to be honoured by APM.

[27]

[38] Ms Zhang in her submission identified a number of differences between ORS and APM. I accept there will certainly be some differences between the two employers operations and there will be some differences between the two roles and some employment entitlements.

[28]

[39] The question for the Commission however is to consider objectively whether the position obtained for her at APM was other acceptable employment. The fact that Ms Zhang's redundant position and the other employment obtained for her at APM are not identical does not prevent the other employment from being other acceptable employment.

[29]

[40] In the circumstances of this case I accept there were some differences between Ms Zhang's former position and the other employment ORS had obtained for her. I also accept some of these differences would have involved some detriment to her however this was relatively limited. [our underline added]

[30]

The Applicant submits that the Respondents employment conditions have remained in line with the previous entitlements and in several instances have improved in circumstances where there were previously no provisions for access to certain type of leave which are afforded under the Local Government (State) Award 2017, being the industrial instrument which now covers the Respondents.
The Applicant submits each of the Respondents accepted the positions offered and commenced the acceptable employment on or around 26 August 2019. As at the date of making these submissions, each of the Respondents remains employed with Council (with the exception of Robert Aston-Brien whose employment with Council terminated on 21 October 2019 by way of resignation).
Emma Gallagher remains an employee of Council, however, has resigned from her permanent part-time position and has elected to continue working for Council as a casual employee as she was successful in securing another role aligned to the study she is currently undertaking
In closing, applying the criterion set out in s 120 of the FW Act and the above-mentioned authorities, the Applicant submits:
- (a) they took pro-active steps to obtain alternative employment for the redundant Respondents and were a 'strong moving force' towards the creation of alternative employment opportunities for the Respondents;
- (b) the alternative employment constitutes _'_other acceptable employment' in stipulating similar pay levels, hours of work, seniority, fringe benefits, workload and speed and job security; and
- (c) the alternative employment was obtained prior the Respondents redundancy taking effect."

[31]

[20] Ms Gallagher's submissions (email of 31 January 2020)[31]

[32]

"I am writing to contest my redundancy being reduced to nil. While there are a few sections from the Applicants Outline of Argument that I do not feel has been honoured, regarding my individual situation, I have only selected one section:

[33]

[34]

I do not agree with the statement that I was offered hours that I was available for. I was not even given the hours that I said I was available for from the hours that were first proposed. The first hours proposed equated to more than 15 hours, which I had applied for as my minimum, but less than 20 hours total per week.

[35]

I have copied an email sent recently to [name redacted] in HR who I have been able to speak with safely and confidently just recently as, prior to council's take over and following, I was experiencing highly stressful conditions at my place of work and did not have anyone in the position above me to reach out to. I have only just recently found myself able to communicate this properly as I had not realised how much I had been crippled mentally and emotionally and was not able to gather myself long enough to communicate the circumstances. Please see my email below dated 10 January 2020 which outlines why I am contesting:

[36]

As requested during our conversation, I have tried to summarise my experience during the transition to PCC during August/September 2019:

[37]

When applying for advertised positions, I had intended to apply for one with customer service as well as in the gym because I wanted to try and remove myself from the environment I was experiencing under the control of [name redacted] since she started as Supervisor. During a conversation with [name redacted], he suggested that because of the demand for employees in the gym department I could put in the hours that I preferred and pretty much be assured of getting them in the transition. This appealed to me as I was still studying uni full time and I didn't have much flexibility between work / life / study balance and other commitments; I put my availability as Mon, Tue, Wed 5hour shifts from open to equate to my 15 hours min permanent part time to match that of my previous position. When the transition took place I was away on leave doing a teaching prac block and had not received any communication or updates regarding my position with council. I had learnt about a casual position being made available to support Group Fitness Instructor and PT positions through a messenger chat which I was grateful for otherwise I would not have had information to be able to apply for this in time before the closing date.

[38]

The Thursday night, 5 September, before I was due to return to work following my prac and PCC changeover, I was contacted by phone by [name redacted] where she told me what shifts she would be offering me. These equated to more than the min 15 hours in total and included 5 hour shifts from open on the Mon and Tue, a Wed shift from 9.30am to 12pm (I think) and a Sunday shift from open. I explained to [name redacted] that due to other commitments, as per my previous work arrangements and due to full-time uni commitments with balancing family commitments I didn't work weekends even though I would help out if needed when I was able to. She advised me that I had to accept all of them or nothing, I asked for her to email these details to me for which she sent me a brief text message. This was yet another example of manipulation and control of this supervisor and needless to say it left me feeling helpless and unsupported as for so long we had know one to reach out to past this person in our department. Because we were now under PCC, I forwarded the text information to myself via email and then emailed it to [name redacted] to state that I could commit to the Mon, Tue, Wed shifts (even though this would be less than the min 15 hours) but also said that I could do a Thur open shift instead to make up the 15 hours; I included Sarah Coleman in this correspondence who I also called and spoke to her early Friday morning before school started (as it was my last day of prac) as I was quite distressed. She suggested that she couldn't see a problem with me only being able to commit to the Monday Tuesday Wednesday shifts and she would talk to [name redacted]. MA replied back saying no I could only have the Monday Tuesday which would be 10 hours minimum. The stress levels I had been experiencing prior to leaving on prac had already returned, I couldn't keep pushing feeling that I had no other support and accepted the hours for the new position.

[39]

Upon returning to Ripples Gym Floor on Monday 9 September for my first shift under PCC at 5.15am to 10.15am, [name redacted] was there from 5.20am and the manipulation and controlling situation escalated. My stress levels were so bad I was nauseous and on the verge of crying. It had gotten so bad that I reached out and confided in Tanya as emotionally I had already been pushed so far. Tanya encouraged me to start a formal complaint and approach HR, which I considered but, realising that this would not have a quick fix and could be ongoing for quite some time where I would be placed in even more stressful contexts with [name redacted], I was not in a position to be able to take much more - I was already having trouble concentrating on others things outside of work such as my family and uni work and would be feeling nauseous just coming in to Ripples to undertake my other position in GF. So after only 2 weeks in the Gym Instructor position, when I reached out to seek other employment and was offered an opportunity to go to a school I accepted. I resigned from my gym position and took work at the school so that I could look after my health and remove myself from the position under [name redacted]'s control. The stress and anxiety I had been experiencing changed so much for which I was grateful so that I could again enjoy my Group Fitness/PT position at Ripples.

[40]

Since I did not have reasonable provision made to accommodate the transition of my existing permanent part time position from Ripples to changing over to PCC, nor was I in that position for more than two weeks am I still eligible for the redundancy package?

[41]

Thank you for your consideration of my inquiry. I look forward to receiving your response."

[42]

[21] In Reply the Applicant submitted that:

Ms Gallagher commenced employment with the Applicant on 16 April 2018. Prior to the transfer of management, Ms Gallagher held the role of a permanent part-time Gym Instructor working approximately 20 hours per week.

The Applicant submits they took pro-active steps to obtain alternative employment for Ms Gallagher and was a 'strong moving force' towards the creation of alternative employment opportunities for Ms Gallagher for the reasons outlined in their original submissions.

The Applicant notes when the transition of management took place, Ms Gallagher was away on leave doing a teaching prac block. On 22 August 2019, the Applicant sent a Transfer of Management letter to Ms Gallagher confirming that the transfer of management of the Applicant to Council was anticipated to come into effect on 26 August 2019 and advising an offer of alternative employment would be made.

The parties exchanged communication in relation to Ms Gallagher's available hours, including Ms Gallagher's inability to work on the weekend and rostering arrangements already confirmed with other employees.

On 23 August 2019, a letter of offer was sent to Ms Gallagher. The offer of employment was for the same role a permanent part-time Gym Instructor, effective from 26 August 2019. The letter of offer also advised:

(a) Employment is subject to regulation by the Local Government (State) Award 2017 (Award),

(b) Gross rate of pay on commencement is $26.26 per hour plus compulsory employer superannuation contributions in accordance with Commonwealth superannuation guarantee legislation and/or the Award, and

(c) Ms Gallagher will be required to work Monday 5 hours and Tuesday 5 hours for a total of 10 hours per week.

On 23 August 2019, Ms Gallagher accepted this offer of employment.

[43]

In Clothing and Allied Trade Unions of Australia v Hot Tuna Pty Ltd[32] (Hot Tuna) the Full Bench stated that at 230 - 231:

[44]

[45]

In applying the test set out above in Hot Tuna_[33]_, the totality of the circumstances affecting Ms Gallagher indicate that the offer of employment stipulates; similar pay levels, seniority, workload and job security. Ripples acknowledges the hours offered to Ms Gallagher were not identical to those worked prior to the Transfer of Management.
As explained by Watson SDP in Feltex Australia Pty Ltd v Textile, Clothing and Footwear Union of Australia[34] at [89]:

[46]

"...acceptable alternative employment is not necessarily identical employment."

[47]

The Applicant acknowledges Ms Gallagher concerns and stress raised in her evidence regarding the transfer of management process, in particular the issues in relation to the reduction of hours and grievances with her supervisor. The Applicant submits, it was only recently made aware of these issues after the transfer of management process (through telephone communication with Ms Gallagher on 9 January 2020 and via email correspondence on 10 January 2020).
The Applicant submits that Ms Gallagher resigned from her permanent part-time Gym Instructor role in or around mid-September 2019, however, remains employed by Council as a casual Group Fitness Instructor working on a rotational roster.
The Applicant acknowledges Ms Gallagher's query regarding whether she is still entitled to redundancy.
In the event Ms Gallagher's role was made redundant, Ms Gallagher would be entitled to redundancy pay in accordance with section 119 of the Fair Work Act and the provisions of the Local Government (State) Award (the Award); the Applicant notes the redundancy provisions of the Award are more beneficial than the minimum provisions contained in the FW Act.

[48]

[22] Ms Gallagher's final submission (email 20 February 2020)

[49]

"I would prefer to be paid the redundancy amount as my new position was not the same, or close to the same, as previous. There were more hours that required filling than there were people to fill them following the change-over. [T]here was one weekend shift discussed that I could not commit to which was previously understood and a third shift that offered but taken away once I advised that I could not commit to the weekend thus leaving only 10 hours. This would seem to imply that all reasonable allowances were not observed in seeking to transition to similar arrangements."

[50]

[23] The FBIS Decision must be applied in this matter because the Agreement includes a redundancy clause which is in different terms to the redundancy provisions of the NES. It is to be noted that the FW Act uses the language of "other acceptable employment" whereas the Agreement uses the phrase "another position comparable in status and remuneration to their position".

[51]

Was Ms Gallagher "entitled to be paid an amount of redundancy" (s.120(1)(a))?

[52]

[24] It is common ground between the parties that Ms Gallagher's employment with Ripples came to an end because her position was made redundant.

[25] Consequently, the Commission, as presently constituted, is satisfied that Ms Gallagher is entitled to be paid an amount of redundancy pay by Ripples because of s.119 of the FW Act. Section 120(1)(a) of the FW Act has been established.

[53]

Did Ripples "obtain" other employment for Ms Gallagher (s.120(1)(b)(i))?

[54]

[26] It is common ground between the parties that Ripples "obtained" for Ms Gallagher the Gym Instructor position with Penrith City Council (Council).

[27] Consequently, the Commission, as presently constituted, is satisfied that in so far as s.120(b)(i) requires an employer to "obtain" other employment, Ripples did so for Ms Gallagher. Therefore, part of s.120(1)(b) of the FW Act has been established.

[55]

Was the employment "acceptable" (s.120(1)(b)(i))?

[56]

[28] It is quite clear that the offer of employment made to Ms Gallagher, while accepted by her, is not considered by her to be "acceptable" for the purposes of the FW Act. However, that is not the test to be applied. It is not relevant whether an employee accepts or rejects other employment for the purpose of deciding if it is "acceptable" under s.120(1)(b)(i) of the FW Act. An objective test must be applied.

[29] Nor is it necessary that the redundant role (Gym Instructor with Ripples) and the offered role (Gym Instructor with Council) be identical in order for the latter role to "acceptable".

[30] Having considered the material in this matter I am satisfied that whilst the redundant role (Gym Instructor with Ripples) and the offered role (Gym Instructor with Council) were not identical there were very many similarities. The table below reflects my findings:

[57]

[31] Having regard to the above, Ms Gallagher was entitled to be dissatisfied with the hours given to her. She had regularly worked 20 hours per week. She was now to be given 10 (or more if she worked weekends - something she had not done previously on a regular basis). The evidence of Ms Gallagher does not support a finding that it was she her made herself unavailable for additional hours.

[32] It is my decision that the role of Gym Instructor with Council at 10 hour per week was not "other acceptable employment" which had been obtained for Ms Gallagher by Ripples. The offer of Gym Instructor with Council only went half way in meeting the position that Ms Gallagher had prior to the transfer of her employment. In offering her only 10 hours Ms Gallagher lost ½ her pre-transfer job.

[58]

Should the amount of redundancy pay be reduced (s.120(2))?

[59]

[33] Section 120(2) of the FW Act invests the Commission with discretion to reduce the amount of redundancy pay by a specified amount. It does not automatically follow that a finding that the other employment was not entirely acceptable will result in the redundancy pay being awarded at 100%.

[34] I have identified in the table above that that there were significant differences in hours between the:

redundant role of Gym Instructor with Ripples; and,

new role of Gym Instructor with Council.

[35] Consequently I have decided to exercise my discretion to determine that the amount of redundancy pay to which Ms Gallagher is entitled to be paid because of section 119 of the Act is reduced to 50% of her redundancy entitlement under the Agreement (i.e. it is reduced by 50%).

[36] An order [PR717480] to that effect will be issued in due course.

[60]

Seal of the Fair Work Commission with member's signature.

[61]

[1] [2014] FWCFB 6737.

[62]

[2] [2014] FWCFB 6737, para [20], referring to s.120(1)(a) of the Fair Work Act 2009 (Cth).

[63]

[3] [2016] FWC 4505.

[64]

[4] [2019] FWC 65.

[65]

[15] Peta Basso Statement Annexure "PB-8".

[66]

[16] [1990] AIRC 980; (1990) 140 IR 123.

[67]

[17] [1990] AIRC 980; (1990) 140 IR 123.

[68]

[18] [1990] AIRC 980; (1990) 140 IR 123.

[69]

[19] [2013] FWC 1327.

[70]

[20] [2008] FCA 1820; (2008) 178 IR 415.

[71]

[21] [2014] FWCFB 6737.

[72]

[22] [2015] FWC 641.

[73]

[23] (1988) 27 IR 226.

[74]

[24] [2008] AIRC 647.

[75]

[25] [2016] FWC 4505.

[76]

[26] [2015] FWC 1269.

[77]

[27] [2005] ALMD 6441.

[78]

[28] (1988) 27 IR 226.

[79]

[29] 158 IR 428, 59 AILR 100-589, [2007] ALMD 3653.

[80]

[30] [1990] AIRC 980; (1990) 140 IR 123.

[81]

[31] I have redacted the names of the people referred to by Ms Gallagher because they are not relevant to the matters I have to consider.

[82]

[32] (1988) 27 IR 226.

[83]

[33] (1988) 27 IR 226.

[84]

[34] 158 IR 428, 59 AILR 100-589, [2007] ALMD 3653.

[85]

Printed by authority of the Commonwealth Government Printer

Penrith Aquatic and Leisure Ltd T/A Ripples Leisure Centre [2020] FWC 1356 (14 March 2020)

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