Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees v Multicom Enterprises Pty Ltd t/a Jubilee Child Care Centre [1999] QIRC 29 (1999) 160 QGIG 133

132 QUEENSLAND GOVERN11ENT INDUSTRIAL GAZETfE 19 February, 1999 19 February, 1999 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 133 QUEENSLAND INDUSTRIAL RELATIONS COMMISSION Workplace Relations Act 1997 - s. 240 application for dispute arbitration bO Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees AND Multkorn Enterprises Pty Ltd t/a JubHee Child Care Centre (No. D264 of 1998) COMMISSIONER BLADES 8 February 1999 Arbitration - Termination, Change and Redundancy Policy-Application for order under subclause 12 of Clause C exempting an employer from "Employers 'fX Exemption" clause - Whether employee was terminated or resigned - Whethcr a redundancy - Whether acceptable alternative employment offered - Principles Y\ · .~ applicable to application for exemption- Bonafvies of employer -Financial difficulty- Consistently less than 15 employees - :Ko manipulation cc contrivance /\ f;\ -- Order refused. i~ ·. DECISION Ms Barbara Carson was first employed at Jubilee Child Care Centre situated at 32 Jubilee Street Caboolture on 24 July 1994 under the Child Care Industry A ward - State. The Centre is owned and operated by the respondent Multicom Enterprises Pty Ltd which also operated Jubilee Tots Centre. The average number of employees employed at both Centres is and was about 10. Ms Carson resigned as from 31 July 1998 after having been informed that her petmanent full-time employment was to be changed to that of casual as from 3 August 1998. There is a difference of opinion as to whether her position at Jubilee Child Care Centre was made redundant The history of her employment is as follows:- 24.7.94 3.10.94 July, 95 13.7.98 Commenced as a casual Groop Leader Appointed pcrmanent full-time as Groop Leader Appointed Assistant Directer Returned to Group Leader (with a $20 p.w. reduction in pay) by way of a lettcr dated 22 June 1998. She was further ncxified by letter dated 29 June, 1998 that her working conditioos would be changed from 20 July 1998 from a permanent basis to that of penuanent part-time. She made enquiries regarding how many hoors she was to work and on 13 July she was advised by letter that her employment was to be changed from permanent part-time to a ca.sual basis, effective 3 August 1998. On 24 July 1998 she gave one week's notice and resigned as from 31 July 1998. It wa<: explained that the offer of permanent part-time work had been a mistake. She was not paid any severance pay as the resJX>ndent employer at all times has employed less than 15 employees. On behalf of Ms Carson, the applicant Union seeks an order of the Commission under the μ-ovisions of subclause 12 of Clause C of the Termination Change and Redundancy Policy (1987) 30 QGIG 1119 (the TCR decision) whicli provides that:- "Suhject to an ocder of the Commission, in a particular redundancy case. this clause shall not apply to Employers who employ less than 15 employees.". Thcr-c is an initial dispitc as to whether a redundancy has occurred at all. The respondent employer submits that the only redundancy which has occurred was when the position of Assistant Director was abolished and at that time Ms Carson accepted alternative full~ime employment as Gr~ip Leader. The applicant Union submits that a redundancy occurred when Ms Carson was offered casual employment in lieu of her full-time employment. It was submitted that there wa, a clear termination of the employment contract. The position is somewhat clouded by .\is Carson' s resignation. She told the Commission that she could not afford to be employed on a less than full-time basis or with the lack of security that ca.~al employment brooght with it. She sooght other employment and gave one weeks notice of termination on the basis that she had an alternative job commencing on 3 August. Othcr reasons advanced for the resignation were that she was not happy with the Director of the Centre and was not getting along with hc:r and that cbil<lren were being moved from room to room withoot staff being advised. She was i:repared to ac(.-ept casualisation for as long as she needed in crder to find other employment but it was not the way me wanted to work. Whilst it never came to pass to be able to be te1.ted, the employer gave evidence that had Ms Carson accepted the casual arrangement, she may have taken home as much money as she had received from hcr full-time position. In Re lVursing Homes and Private Hospital Employees Redundancy (State) A.ward (1997) 74 IR 151, the Industrial Relations Commission of NSW said at p. 159:- "If an employer seeks to reduce an employee's boors of work, classification oc rate of pay rather than tecminating the eJq>loym.ent, the employee will have the choice of either accepting or rejecting the offer. This follows because under the general award provisions applicable in this industry, eJ11Jloyers have no right to unilaterally vary such conditions, no matter whether the employee concerned is a full-time or part-time employee. Employers and employees are however free to agree to such cha.nges. If such an offer is accepted by the employee, the employment will continue upon the new agreed tern~ ... If the employer's offer of changed terms is rejected by the employee, it is the employer who will then be faced with a choice either to continue the employment on the existing basis or to terminate the employment. If the employee is then made redundant, the provisions of the new redundancy award will apply ...". lt rrust be api:reciated that the respondent did not merely seek to reduce Ms Carson's hours of employment. The employer sought to alter the fundamental nature of the employment relationship. The. employee had the choice of whether to accept oc reject the offer. Clearly she rejected the offer and the employer ccttld not unilaterally make the changes. Was she terminated or did she resign7 -- 1 of 2 -- QlJEENSLA.ND GOVERNMENT JNDUSTRIAL GAZETTE 19 February, 1999 hx 1 ·.:d1.,ud,•ncy l<> occm ,here n;ust have been a termination at the initiative of the employer. lt has been stated in Molu1zah v. Dick Smllh Elecircmics Ply Ltd ( l 'N'.') IR 2((; th;it a tc:rnunation :H the· initiative o1 the employ<'x may he treated a:, ,1 krrninati;>n in which thc action of the ,:mpioyer is the μ:incipal • untnbutrncc foctor ½hi•.:h kad., to the· termination of the employment relationship. ln Cowell v. !rbnond Pty lld ( 1997') 86 [R 3"i2, the isst1t: raised was whether v•,,·n :, 1kmrnion of C nvdl which It:sulkd m the termination of his em.ployn10nt at the mi native of the ernployer. M(x:n: J :;aid at 355 :- ·in 1k· pr1:s,:m C<l'•~ lhcc fac:tor whid1 nrecipitated the: krnnnaLion of Cowel!'s employment was tht J•:(is10n that was u,kcn to demote him. It is also. in my opinion. th<' cov0nt which caused the termination of his employment. Counsel f<I' Irimond sought 10 chara(iense Cowell's response as an emotional if not an 1dhisynn~f;c on,·. I disagree. J-I,i wa., bt'.ing ,iffered a posi110n al 11 lower base salary with no certainty about susiaining cr maintaining the income he was ,JH~n cnjc,yin12- as a retail floor sales manager.. It was a less senior position. Those fa:::t<:es alone would justify a conclusion rhat the employment of Cowell 'Nd" fennin,1ted at the mitiat1w of lrlmond when Cowell refused to accept the. dernotion:' T think 1. comp;l!'i~rJn c::m he mad,.· to M, Car,1;011' s clfcumstance:s. Whilst she did eventually resign, that rc8ie,nation wa:, prompted by the employer's decision to ffldt,·.naJ!y alr~-r her employment status, somethmg which she had reJected. Jn those circumstances, I am satisfied that tht>re was a termination al the initiative of th<' ,.,;rnpiny;:r. "tie cert:linly diri n(>t voluntarily leave her full-time posit.ion. It was thf'n argual by th, respondent 1.hat th,~ change to part-time ewployment and then to casual employment wa:i not a redundancy because of the proposed .;mall ,eduction in hours. However, then.: wa.~ never any guarantee of ID1mmum hours and it was the fund,rntental namre of the changes that was important. In Quaii,) Rah•r_, ofibst i·. Goulding (19')5) 60 IR 327 Bf'.azley J said at 332:•- -- A redundancy will arise where an emplover has Jabcur in excess of the requirements of the hu:-im'.ss; ·.vhere the employer no longer wishes to have a parncular joh P<:rfomvd: or where ,he e;1iployer wishes to annlgamate jobs: . It is not necessary for the work to have disappeared altogether.". B1 reducing her 1rom fo!J .. lirne to part-lime or (:asual, the empluycr dearly had labour in excess of the requirements of his business. I am satisfied that there was a terrnination ,,f ernployment and the r<'.ason for that tei-mination was the operational requirements of the bnsiness thus constiOJting a redundancy. ·n1,:r<0 wa,, a subm.i.,si('Il that acceptahk alWrnative employment was fYOVide<l, firstly because of the change from Assistant Director to Group Leader and then frnrn the full-iime position to the ca:,ual pm;itwn because it was the intention of the employer not to greatly reduce the number of hours. 'Ibis submission went to t!w rt·,y,:ision,s of subciause 9 d the TCR Dec1s1on wh1d1 provides for a variat1011 to the general severance pay prescri[tion whern the employer has obtain,:d ,H'c,.'.p!ahit: ,,iternativ:: employment. The alleratiuu from Assistant Dl!'ect<X to Group Leader was obviously acceptable because Ms Car"on agreed to the change. l kwcv0r, the alkr<1t1on w cas1.ul Wa.." not acceptable and ~,ectively, could not be acct>ptablc. By irs very naOJre, casual employment provide~ for no gwuantee .,f ht~1r.-.: and whilst thr' e1nployer might chum in evidence that he was preparcd to provide sufficient hours so that the eventual take-hom: pay was not to be ;.::: ,:al]_v afteckd, thcre w.-1.s no guarantee that would <x:wr or continue. As Mr Reed pointed (~Jt, if she was going to take home the same money. why reduce ht1 cd.',1lill ,ii ,tll'.' Ttiu.~ m 17tt' Australian CJuimbn of Manufactur,:r v. Deruie l•,iominces Pty Ltd Print J-1,114, a decision delivcred 12 September 1990, the FuJJ fLnch o! the: A.LR.C. said: "What constitutes ·acceptable alternative employment' is a matter to be determined, as we have sai<l, on an objective basis. Alternative employment acn:pted by the employee /_and its C<Iol!ary, alternative employment acceptable to the c'.mployee) cannot be an apjYopriate application of the words because that m:::arung would give an employee an unreasonable ,1nd uncontrollable oppcclurnly !o re,ect the new t·mploy,nent iu order to receive redundancy pay; the c:;;ccmpt;on 1~0\:1si,rn would be~ without ixact1cal effect. 1\:1 th,: 1J~e of the ,.1u,1.Jificati<'>n ·acc.:,plahle' is a ck'.ar indication that it is not any employment winch complies but that which 1neet<. the relevant stmdard. In 001 oprnion there are 0lwict.ts element~ of such a standard including the work being of like Hdture: the locat10n heing not unrea.~onably distant; the pay arrane.ernent.~ complyin,£ with award requirements. 'lliere will probably be others.'' l •...;ould 111dc1dc dlllong those wh,:thcr th<'. nature of the alternative c,)utract of employment otlered was of ,t tundame.ntal difference and it was; so much so that I :m, nnt s,111,ti,'.d that it i,,;as acct'ptahie alkmative employment. 'Jh, '!u,.·stinn rh,·n IP h,· considt~red is whetha there: :-hould he an order of th,: Commission that subclause 12 (Employers Exempted) should nct apply to this cmployc1 in thi., partiaJlar rtcdundancy ca.<e. What is to be taken into accoont? Ht~rc' ,vcrc many dcci,~i,,ns rcfc:rrcd to by the parties. In Felt Hartmg (Consolidated) Award /993 -Application for Variation (12 October 1993) Print K9342 ·,imil:rr applic;ti,m was made IP Comrnissioner Oldmeadow, she said:-• · "lh,: ahovementi1,11t·d Commi,sion d.::cisions a.s f have already mdicated arc not in my view rclc'.vant to the ,,:;ira.unstanccs of this case. In ail instances there i,,;4,~ controver~:y surrc(lnding .:ither the company .,truclurc an<l/or the actual number of employc:es at the time ot the redundancies. In nearly every case there app,:ars ro have bf:en an apiroach taken by the employer whid1 suggested that the employer had deliberately, or artificially created the cirrum.nances n•xessa.ry L> bring the excmpti,.Jn subdausi: into operation. l h,: facL, in this matter are not dispukd, and them is no evidence that the employ,:r acted in a dc,ceitful or improper way in ordcr to bring the exemption subdause intP effect.". Ji w,,., ;,J,;o tound hy the Commis~i,mer that th,.~e wa:, no 1t:yui1c:ment for a company falling within the exemption subclause to prove incapacity. In that regard, 1t is apparent that any company, whether employing Jess than I 5 or more than l 5 employees is entitled to invoke the provisions of subclause 13 of the TCR D·:ci,i0r, which relate~ specifically to incapacity. 1\1,.w,·alimi }',;uning .r·-edPmi,,m /)iabeies A.us:ralia ACT (1996) 70 IR 357 wa., a case where an order was made to remove the exemption in respect of a pa.rticular rcdm,dancy. Duncan DP ign<Tcd the financial dJ.tficulty of the <. 'ompany, referred to tJ-1e reasonable length of service of the nurses (noi furtller ,1n~ntified). ll;ey had also hecn told they might receive redundaa,;y pay but then had the possibility withdrawn on technical grounds. Again, there was some ,:,mtroH:rsy ov,T whether the Company was part of a group employmg ma-e than 15 employees altl,ough a. positive finding was unable to ht: made. Con1t•uction. Fmestn, Minin1; and 1:;nerg1· Union v. Peter.,· Shp RPpairs Pty Ltd (1 frrreported AIRC Print K222:'i) wa<. refen-ed to in Duibdes. There the ('pn;m1s.<·1rnwr tnuul th,tt thL:rc: were rnore than l 5 employee;; ir: a group of employers. /..,.1rn,ns Ji,: 1.::1.;,;:; ,;1ted. theie v.as abo Ihe Fedt'rated MisCl'llaneous Workers Union ofA.ustrali.a v. Simpson Gloves Pty Ltd and Another Print Kl 633. In tllat ,:a.~e, une of tl·1cc workers ha,~ .~5 years serv1c,:. Twelve months before tht· bearing, 5 workers: had been retrenched and paid severance pay and 6 workers ·,•,ere u,11tim1t·d in t·mpluyment. 'Jhe ,-ompanv lost a .substantial contract and do8ed and it indicated that it was not ixepared to pay redundancy payments as there were uov. tli;w 1·, v,:nrk,•r~ employ,~d The Comp;my was in sigruficaul debt. Comnuss,oner Menunan. m rejecting the application, said:- 19 Fchruary, 1999 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 135 "'Tiie1e is nu evidence before the Commission that Lhis ernp!oye1 alkrnpted to contrive a situatwu ·w.t1ereby it would be tcxclud.:d tiom ih<✓ 1e(famJ,u,c) provisions of the award:' Fink v. Ca/1-,vood Pty [Jd (1995) 148 (){i1G 122:-l was a dcc1810n oJ Fisher C relied upon by both partteS. Jn that case, ther-: ,.vas agarn contrn\•W:}' ,;urroc.rndrn,..: the company structures and thcre were grounds for bd1e·,irrg t.hdt the Companies conce1 ne<l may have othe1 illkrest.s in the Shuppiug Cent1<.. n,c ,~rnpio)nc• were not told of the impending sale, they were assured there would be no sale, they were ffilsled rnlo believmg there was iong term employment, they ,w;.· confronted by locked doors, given no counsdiiug and no effort was Jlld.de to find othe1 employment. These cirwm.stanc:es led the Commis.,i,m~1 tu be safr,ficd the treatment was unfair and harsh. ]hose facts can be distinguished in thi.\ case but Fisher C did gn on to say thar:-- "It seems to me that m assessmg whether an u-der tor severance payment~ should be issued under dause 12, the general guidmg μ:-mc1pko' tor d·:•.:iswns ;,t the Conunissiou ate equity, good co11:..cience, the substantial merits of the case and the public interest. .. It follows that e.1ch ;;a.,,~ ha.., Lo l.•t' ,.;uos1de1 ed on ii.\ own partlrular facts and circumstanct:s. Because an appltcat1on 1s granted on one set of facts and crrcmnslances Jt d0es not foilow that othct app!tciIHlD~ will necessarily be granted.". · It is obvious that any number of matters will go toward;; the decision whether equity, good conscience, the substantial merits of the ca.se and 1he public rntvre$t decree that an applicat10n be granted. Of considerable importance is clearly whether an employer has contrived to defeat the intent10n of the TCR [)eci~io11. Capacity to pay also has relevance for one can rc'.adily imagine a multi-million dollar Company with kss than 15 employees. It wa.< recogm.\<Xl in Clothini Trades Award -Application for Vanation Prmt KM/4 (2J March 1993) by the Full Bench of the AIRC that many employers who employ only :i small numbc:r of employees have very lucrative businesses an<l the adoption of corpornte strnctures was indicative of the potential for abuse. Mauipulatir•11 uf empluyme!H levels to <;am relief was also referred to by Ledlie CC in Electncal Trades Unum v. Elec!rical Contractors Association (1991) JT; Q<ifG 143. Ont> may ab·l accept that situations where there are temporary fluctuations under and ova the arbitrary number may be relevant to consider. Mr Ree,d suggested that matters to be taken illlo account might include length of service of lhe employee, the condud of the employer dli<l the ernpluyee. tlie financial cira.unstances of the employer and other matters. I do not disagree, but f have fwnd notlung which moves me to make the order sought. In this the length of service of abwt 4 years was not great. There was nothing in the employer's conduct which should b,.; criticised and whilst Ms Cm;on wa5 ,,iven /JO time off to seek alternative ernp!oymenl, she did not ask tor it and she found alternative employment before she left. (It was not In the: p<)mt that the emi;loymcnt did not work wt). It was suggested that the eiq:,loye.r could have accommodated Ms Carson' s full-time position by employing her 0nly on the mornmg shift However, I consider that the explanation offered was reasonable, that it would have shown bias and upsd the other staff who also, had been redu,;,~d frum ptrmanent to casual some time ago. I re:iect the submission that the employer showed a callous disregard for Ms Carson's rights. I cruid find no basi5 for :<\lei, a finding. In this case, the respondent company was eventually forced to close th<.: associated Centre, Jubilee Tots in October l 998 and to move the children tr,)m rhei e Jubilee Child Care Centre. _\,fa Carson was the ia.~t remaining full-time employee, all othcrs having been reduced at som:e time prcviou!"., t0 casual ,tatus. \'is Carson was also aware of fin.utcial rrohlems facrng the Centre wht'n cost cutting measure~ were sought to be introduced. She was awari> ?fo,! the numhcrs children were steadily declining. On the other hand, I suspect that the Company wuld afford to pay severance, pay having rcgard to Mr L,ong'" admission foal he wculd afford the $4,000 sought, if a-den•d, and also that a part of 1hr busines.0 e~penses related to .mhstantial rental {:llyment<. nl3.de lo him dDd his w,fr However, the Company only ever employed about 10 employees and there was cc:rtainly no suggestion of contriYauce on rhe part of the Company to dccf..•M the provisions of the TCR Decision. There was enrugh evidence of financial difficulty to corroborate the bona Jules of the Company so thal 11 c:ould not bt: su_gge.,-le<l that the Company wa,, rn-.·ol, in a scheme or sham to cira1mvent the inknt ,.)f th,: Decision. Ibe apphcaot seeks that an cx-der under subdausc 12 be mi1de. ft would S<:0em that the applicant therefore bears an onus of showmg that such an 1nier shculd b.: made. Without conceding to the tesixmdent tl1e conecmc.s.~ of a suhniis:-ion that there need., to be unusual or ex1:eptional c1rcumstances ~howu, iu !h,: wlwk ,,f the c:ucu1nstances and on the whole of the e:vidence, I am not satisfied that an order should be made exemptmg this respondent trom the operation of suhdam,: 12 in this vanicular redundancy. BJ. BLADES, Comnus.,iuner. Rdt,ased: 8 1-~chruary i 999 Appeawrua ·- • Mr R. Reed for the Aust1alian Liquor, llospttality and M1sc,·lbueous \\'i,rkcr., Gnion. Queensland Branch, Union of Employe,•.s. • Mr M. Patti, Employer Services, forth,~ respondent. ft############################################################################################################!!############# -- 2 of 2 --