s.120 - Redundancy pay

• [1] This is an application made pursuant to s.120 of the Fair Work Act 2009 (the Act) by Uniting Church Homes trading as Juniper (the Applicant). The respondent is Mr Gagandeep Sandhu.

• [2] The Applicant is applying to the Commission to reduce the redundancy pay the Respondent is entitled to be paid to nil, on the ground that the Applicant has obtained other acceptable employment for him.

• [3] Section 119 and 120 of the Act are relevant and are set out below.

(1) An employee is entitled to be paid redundancy pay by the employer if the employee's employment is terminated:

(a) at the employer's initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or

(b) because of the insolvency or bankruptcy of the employer.

Note: Sections 121, 122 and 123 describe situations in which the employee does not have this entitlement.

(2) The amount of the redundancy pay equals the total amount payable to the employee for the redundancy pay period worked out using the following table at the employee's base rate of pay for his or her ordinary hours of work:

Employee's period of continuous service with the employer on termination

(3) A reference in this section to continuous service with the employer does not include periods of employment as a casual employee of the employer.

120 Variation of redundancy pay for other employment or incapacity to pay

(a) an employee is entitled to be paid an amount of redundancy pay by the employer because of section 119; and

(i) obtains other acceptable employment for the employee; or

(2) On application by the employer, the FWC may determine that the amount of redundancy pay is reduced to a specified amount (which may be nil) that the FWC considers appropriate.

(3) The amount of redundancy pay to which the employee is entitled under section 119 is the reduced amount specified in the determination.

• [4] The Respondent's employment is covered by the Juniper Registered Nurses Enterprise Agreement 2018 (the Agreement).

• [5] The Agreement includes clause 30 - Redundancy, which, noting the discrepancy in numbering, includes the following sub-clauses:

28.14.1 In addition to the period of notice prescribed in Clause 9 - Notice of Termination, for ordinary termination, and subject to further order of the Commission, an employee whose employment is terminated on the ground of redundancy will be entitled to the following amount of redundancy pay in respect of a continuous period of service:

28.16.1 The Employer, in a particular redundancy case, may make application to the Commission to have the general severance pay prescription varied if the Employer obtains acceptable alternative employment for an employee."

• [6] The Commission issued directions to the parties to file witness statements and submissions.

• [7] The Applicant, compliant with the directions filed their materials however the Respondent has not filed any materials in response and not contacted the Commission regarding this matter.

• [8] Consequently, this matter is determined on the materials filed by the Applicant which is not contested.

• [9] The evidence before the Commission, which I accept, is that on 16 December 2021 Juniper's Board decided to close Juniper's Residential Aged Care Facility in East Fremantle "Pilgrim" by 30 June 2022.

• [10] At the time the Applicant was employed as the Clinical Nurse Manager at Pilgrim.

• [11] On 8 February 2022, all employees working at Pilgrim were advised the facility would be closing and that Juniper had many vacancies across the organisation's 25 other Residential Aged Care Facilities. Therefore, redeployment would be available for all employees who wanted to remain with Juniper.

• [12] Following the notification of closure, Juniper invited all employees at Pilgrim to complete a Relocation Preference Form.

• [13] A copy of Mr Sandhu's Relocation Preference Form has been filed with the Commission.

• [14] His form stated he would be prepared to travel a maximum of 20 minutes from home to work.

• [15] On 10 March 2022, Ms Mousavi, Juniper's People and Culture Advisor, contacted Mr Sandhu and offered him redeployment to the Clinical Nurse Manager role at Juniper's Annesley facility (the other employment). After Pilgrim, Annesley is the closest Juniper site to Mr Sandhu's place of residence.

• [16] The other employment offered was the same role as Mr Sandhu's role at Pilgrim. It had the same daily hours, the same rate of pay and the same benefits as Mr Sandhu's role at Pilgrim. Travel time from Mr Sandhu's residence to Annesley by car is approximately 30 minutes. This is approximately 15 minutes more than Mr Sandhu's travel time to Pilgrim.

• [17] Mr Sandhu requested time to think about the offer and was asked to respond to Juniper's offer by 14 March 2022. Mr Sandhu was informed that rejection of a reasonable offer of redeployment may lead to him being ineligible for a redundancy payment.

• [18] Mr Sandhu made no contact with Ms Mousavi by 14 March 2022. On 15 March 2022 after several unsuccessful attempts to reach Mr Sandhu by telephone, Ms Mousavi was able to speak with him by telephone whilst he was at work at Pilgrim.

• [19] Mr Sandhu told her he had not yet decided whether to move to Annesley and did not know when he would be able to decide. Ms Mousavi advised him that the other employment at Annesley is a critical role and needs to be filled as soon as possible. It would therefore not be possible to keep the position vacant indefinitely.

• [20] Mr Sandhu was asked to contact Ms Mousavi as soon as he had decided. This was the last conversation Ms Mousavi had with Mr Sandhu about the matter. Mr Sandhu did not contact Ms Mousavi with a decision.

• [21] After her telephone conversation with Mr Sandhu on 15 March 2022, Ms Mousavi emailed Mr Sandhu the details of their conversation.

• [22] Mr Sandhu did not reply to Ms Mousavi's email. A copy of the email was filed with the Commission.

• [23] On 20 April 2022, Mr Peter Humphries, Area Manager, wrote to Mr Sandhu to inform him that his employment with Juniper would cease on 11 May 2022 and noted that he would now be aware that Juniper has applied to the Commission to vary his entitlement to redundancy.

• [24] Considering the facts above, the issue to be determined by the Commission is whether the other employment offered amounted to "other acceptable employment" within the terms of s.120 of the Act and/or "acceptable alternative employment" within the terms of the Agreement and if it was whether the amount of redundancy pay payable should be reduced and by what amount.

• [25] As noted by the Full Bench in Australian Chamber of Manufacturers v Derole Nominees Pty Ltd at 124:

"What constitutes "acceptable alternative employment" is a matter to be determined as we have said, on an objective basis. Alternative employment accepted by the employee (and its corollary, alternative employment acceptable to the employee) cannot be an appropriate application of the words because that meaning would give an employee an unreasonable and uncontrollable opportunity to reject the new employment in order to receive redundancy pay; the exemption provisions would be without practical effect.

Yet the use of the qualification "acceptable" is a clear indication that it is not any employment which complies but that which meets the relevant standard. In our opinion there are obvious elections of such a standard including the work being of like nature; the location being not unreasonably distant; the pay arrangements complying with award requirements. There will probably be others."

• [26] The determination of whether the position offered was other acceptable employment must be determined objectively and not subjectively from the perspective of the employer or the employee.

• [27] As was explained by Watson SDP in Feltex Australia Enterprise Agreement 2004 at [89]

"...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."

• [28] The fact that the other employment may be rejected by an employee does not objectively make it unacceptable.

• [29] In Clothing and Allied Trade Union of Australia v Hot Tuna Pty Ltd a Full Bench of the Commission found that the determination of whether alternative employment is acceptable will involve a consideration of such matters as pay levels, hours of work, seniority, fringe benefits, workload and speed, job security and other matters including the location of the employment and travelling time.

• [30] In National Union of Workers v Linfox Australia Pty Ltd 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

• [31] In my view the term "acceptable alternative employment" considered in this case law and in the applicable Agreement is the same as the term "other acceptable employment" used in s.120 of the Act and hence the case law is directly applicable in this matter.

• [32] In this case there is no doubt the Applicant had obtained other employment for the Applicant.

• [33] The previous position and the other employment offered to the Applicant were identical except for the travel time each way by car from the applicant's home being 15 minutes more.

• [34] Considering all the circumstances here I am satisfied that the other employment obtained for the Respondent by the Applicant was other acceptable employment under the Act and was acceptable alternative employment under the Agreement.

• [35] The Commission's decision is that the amount of redundancy pay the Applicant is entitled to under the Act and the Agreement should be reduced to nil.

• [36] An order to that effect will now be issued.

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