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T13008

 

TASMANIAN INDUSTRIAL COMMISSION

Industrial Relations Act 1984
s.29 application for hearing of industrial dispute

Susan Marion Dale
(T13008 of 2007)

and

The Community and Public Sector Union
(State Public Services Federation Tasmania) Inc.

 

COMMISSIONER T J ABEY

HOBART, 11 October 2007

Industrial dispute - alleged unfair termination of employment - redundancy - whether genuine or a sham - redundancy found to be genuine - no unfair termination - offer of reasonable alternative employment - notice - redundancy payment - order issued

REASONS FOR DECISION

[1] On 21 August 2007, Susan Marion Dale (the applicant) applied to the President, pursuant to Section 29(1A) of the Industrial Relations Act 1984, for a hearing before a Commissioner in respect of an industrial dispute with The Community and Public Sector Union (State Public Services Federation Tasmania) Inc. (CPSU) in respect to the alleged unfair termination of her employment.

[2] The matter was listed for a hearing (conciliation conference) on 29 August 2007, a directions hearing on 6 September 2007 and for hearing on 18 September 2007. Mr K Stevens appeared for and with the applicant. Mr M Johnston, appeared with Mr T Lynch (29/8/07) and Mrs K Taylor (18/9/07) for the CPSU.

Overview

[3] Ms Dale commenced employment with the CPSU some eight years ago. In September 2004 Ms Dale was appointed to the position of Membership Support Manager. The primary responsibility of this position is the management of the membership database (MUST). The Membership Officer (Dylan Forbes) reported to Ms Dale.

[4] On 26 June 2006 Ms Dale lodged 17 grievances with the Treasurer of the Union. (Note: This is an honorary position and a member of the Executive Committee and Council of the CPSU.) Whilst the complaint made reference to being "unfairly treated by management and other staff"1, it was clear that the grievances were principally targeted at the General Secretary, Mr Lynch.

[5] The Executive Committee appointed a review panel to investigate the grievances.

[6] On 25 September 2006 the review panel completed a report2 (the first report), which contained eight recommendations. These recommendations were conveyed to Ms Dale and Mr Lynch.

[7] On 13 February 2007 Mr Lynch wrote to Ms Dale expressing concern about a supervision issue concerning employees under Ms Dale's control.

[8] A meeting of the Executive on 26 February 2007 instructed Mr Lynch to explore alternative arrangements to operate membership, including the possible outsourcing to the Victorian Branch.

[9] By letter dated 5 March 2007 Ms Dale lodged further grievances (35 in total).3 The Executive appointed Vice-President Dr Pascale Dettwiller to undertake an investigation.

[10] By letter dated 15 April 20074 Dr Dettwiller recommended the matter be forwarded to the Anti-Discrimination Commission "without delay" (the second report).

[11] On 17 April 2007 the Executive considered a report concerning Ms Dale's refusal to attend a meeting with Mr Lynch concerning operational matters, unless a representative of the ASU accompanied her. The Executive resolved that a letter be sent to Ms Dale "explicitly outlining (Mr Lynch's) right to manage the day-to-day affairs of the union and his authority to manage her".5

[12] At a meeting on 20 April 2007 the Council noted the grievances lodged by Ms Dale.

[13] On 1 May 2007 the President, Mr Jones, wrote to Ms Dale and Mr Lynch advising that the Executive "has determined to take no further action in either investigating or determining the allegations raised".6 The correspondence also noted:

"This decision in no way stops either party pursuing any outstanding grievance through an appropriate external jurisdiction should they choose to."

[14] At a meeting on 1 June 2007 the Council accepted a recommendation from the Executive to outsource the provision of Membership Services to the Victorian Branch. The Minutes recorded that Ms Dale and Mr Forbes be "considered for re-deployment options within the union, or if this is not possible, will be offered redundancies".7

[15] On 4 June 2007 Mr Lynch informed Ms Dale of the Council decision. Later that day Mr Lynch wrote to Ms Dale in the following terms:8

"Re: Contracting Out of Membership Services

I write to clarify the issues I raised with you this morning in the presence of your union representative.

The Council of the CPSU has decided to contract the provision of membership services to the CPSU Victorian Branch. The reasons Council took this decision are detailed in the resolution attached but can be summarized as:

1. Dealing with risk management;

2. Modernising our membership system and introducing new software; and

3. Improving our access to data and standard reports.

The impact of this decision is that the role you currently perform will no longer be required. Every effort will be made to assist you at this difficult time. This decision is not a reflection on your work but a response to a set of business challenges. The CPSU will actively seek alternate employment for you and will assist you by offering a skills enhancement program, training or assistance in interview techniques and CV preparation. If there is anything specific you would like considered please let me know. In the end however, if redeployment options are not forthcoming you will be entitled to a redundancy calculated on the basis of 4 weeks notice and 2 weeks for each year of service.

The timeframe for implementing this decision has some flexibility. If you found alternate employment in the short term arrangements could be fast tracked to get the Victorian Branch to take over. Otherwise I would be willing to consider a phased change over between now and the end of September 2007 to maximize the period you would have to get alternate work.

I realize this is a stressful time. I have briefed our EAP provider and Neroli at Vicki Martin's office is ready to assist on 1800 064 039. This has been an extremely difficult decision for all involved. I hope we can assist you to find another role where you can utilize your obvious kills.

Please let me know if there is anything I can do to assist you.

Yours sincerely,"

[16] For the sake of completeness a similar process was followed with Mr Forbes. He was subsequently offered a lower level position in the Union. However he declined this offer and was presumably given a redundancy payment.

[17] Management was of the view that there was no position available within the Union that was remotely commensurate with Ms Dale's level and skill set. Accordingly no redeployment options within the CPSU were made to Ms Dale.

[18] Mr Lynch did become aware that another union (HACSU) had a vacancy for which Ms Dale would be well suited. However Ms Dale declined the subsequent offer of this position.

[19] Around mid August the Victorian branch advised that they were in a position to implement the Service Agreement. At the initiative of management, Ms Dale's date of termination was brought forward to 24 August, with payment in lieu of notice until the end of September 2007.

[20] A conciliation conference on 29 August 2007 failed to resolve the matter. At the subsequent hearing it became apparent that the following matters needed to be determined:

1. Was the termination of Ms Dale a consequence of genuine redundancy based on a sound business case and proper process (the CPSU contention)?, or

2. Was the redundancy a sham and Ms Dale unfairly terminated as a direct consequence of her unresolved grievances against Mr Lynch (Ms Dale's contention)?

If the answer to 2. above is Yes, then the applicant seeks reinstatement.

If the answer to 1. above is Yes, then the following question needs determination:

3. Was the refusal by Ms Dale of the offer of the HACSU position of such a nature as to disentitle her to a redundancy payment, either in whole or part? (Note: During the proceedings the CPSU withdrew the initial redundancy payment offer and sought to formally set aside any entitlement arising from s.47AH of the Act).

If the answer to 3. above is No, then what is the appropriate calculation of the notice period and redundancy payment?

Evidence

[21] Sworn evidence was taken from the following witnesses:

· Susan Marion Dale, the applicant

· Thomas Gerard Lynch, General Secretary of the CPSU

· Lindsay Scott Jones, President of the CPSU.

Grievances Lodged by Ms Dale

[22] Mr Stevens submitted that Ms Dale had "endured a consistent program of what she believes to be unfair treatment and discrimination against her since approximately the beginning of 2006".9 However Mr Stevens made it clear that "we are not proposing to argue the merits or otherwise of this unfair treatment here today. We are using another jurisdiction for that".10

[23] Consequently this decision will not traverse the substance of the allegations. However as the applicant contends that there is a direct link between the grievances and her subsequent termination, it is necessary to review the process and timing of the grievance investigation process.

[24] It would seem that the Executive intended that the first set of allegations be investigated externally. However as no suitable person was available, a review panel was appointed from within the Executive.

[25] I am quite satisfied that both Mr Lynch and Ms Dale were given every opportunity to place all relevant material and comment before the panel.

[26] The review panel report summarised the evidence and recorded a conclusion in relation to each of the 17 issues raised in the allegations.

[27] The report concluded with eight recommendations, which were conveyed to the parties by correspondence. The review panel Minutes of 3 October 2006 record:11

"It was agreed that the working papers, resulting from investigation, would be made available to Tom and Susan for viewing in the presence of a member of the Review Panel. Under no circumstance are the working papers to be permitted to be copied nor notes made regarding the content."

[28] Both Ms Dale and Mr Lynch declined to view the report.

[29] One of the recommendations provided for a follow up by the Executive to "satisfy themselves that the intended results are being pursued".

[30] Mr Jones said he approached Mr Lynch and Ms Dale in December 2006 seeking a response to the recommendations. Mr Lynch responded by e-mail on 19 December.12

[31] The Executive Minutes of 26 February 2007 record the following:13

".2 Susan Dale

TL raised concerns about the manner in which Susan Dale is undertaking her managerial duties and the stand she has taken against communicating with him. There was a general discussion about her inaction to respond to the outcome of seven dot-points concerning her grievance against TL. LJ pointed out that he had contacted her on a number of occasions to get her response and had received nothing to date. LJ had made it clear that Susan Dale was to provide her response before this Executive meeting but she had failed to comply. GR and B both indicated they considered Susan Dale had been provided with ample opportunity and that her failure to respond effectively blocked Executive from acting. LJ will have further discussions with TL and will write to Susan Dale. He will send a draft letter to Executive by the end of the week.

TL outlined the situation between AH and JM and Susan Dale's lack of action that resulted in a very stressful situation for all staff and A's effective resignation. As a result, TL had written to Susan Dale informing her that the two staff members would report to another manager and asked to speak to her about the letter, she refused to speak to him regarding the correspondence. TL noted his concern that Susan Dale had not trained other staff in MUST operations and if she left with short notice the union would be unable to collect member subscriptions. Executive expressed their concern at her managerial behaviour and agreed that TL should explore alternative arrangements to operate membership. One area of consideration is to outsource Member Services to the Victorian Branch for a fee for service arrangement."

[32] In correspondence to the President dated 5 March 200714 Ms Dale responded to the first report recommendations and, in addition, raised a further 35 allegations/grievances under the broad headings of Bullying, Discrimination and Other Issues.

[33] The review panel meeting on 22 March 2007 appointed CPSU Vice-President Dr Pascale Dettwiller to conduct an investigation.

[34] Dr Dettwiller interviewed both Ms Dale and Mr Lynch. The interview with Mr Lynch took place on 27 March although Mr Lynch was not provided with a copy of the allegations until 23 April.

[35] In correspondence to the President dated 15 April 2007, Dr Dettwiller said:15

"Grievance Investigation Report in relation to the complaint from Susan Dale dated on 26th June 2006

I have interviewed the complainant Susan Dale, Team Manager Membership, on 5th April 2007 in Hobart in presence of Chris Dodds, ASUT representative, and the respondent Tom Lynch, General Secretary, on 27th March 2007 in Devonport.

Having spoken with both parties in depth and after receiving all that has taken place since this matter began on 26th June 2006; I believe that much time has been waisted, and ill-feelings prolonged because a matter was not dealt with appropriately in the first instance.

From my interviews with both parties there has been no change in circumstances. This matter should be put before an appropriate professional body, anti-discrimination commission without delay.

I can not convey the message strongly enough to the Executive Committee that `the process of this type of issues must be transparent and expedite'.

It is therefore my recommendation that the Executive Committee forward the matter to the Anti-Discrimination Commission without delay. Not to do so is to deny both parties natural justice and that the Council may have failed in its duty of care."

[36] The review panel considered this correspondence on 30 April 2007. The Minutes record the following:16

".1 Susan Dale - Grievance

LJ handed out a copy of PD's report and a list of outcomes sought by Susan Dale as a result of her grievance. These documents were used by the Review Panel to make the following determination:

· Executive will take no further action to investigate or pass judgement upon Susan Dale's allegations

· This decision reflects the lack of evidence provided even after 11 months

· Recognise the ability of either party to refer the matter to an external jurisdiction

· Write to Susan Dale and Tom Lynch to inform them of the decision

MJ made some observations, in his capacity of a member of Executive, about the affect the on-going issue was having on the workplace."

[37] On 1 May 2007 Mr Jones wrote to both parties in essentially identical terms:17

"I write on behalf of the Executive of the CPSU.

Over the past 11 months we have attempted to deal with allegations made by you against Tom Lynch, CPSU General Secretary. I can inform you that Executive has determined to take no further action in either investigating or determining the allegations raised.

This decision has been taken after serious considerations by Executive and I would make a couple of points around the basis of this decision:

1. Even after 11 months and two written sets of allegations, the allegations lack sufficient evidentiary rigour. Most allegations are unsubstantiated and have not had any evidence tendered in support of them.

2. This lack of substance does not allow Executive to make any real determination on the matters raised.

3. I would note here that the above is despite numerous attempts by Executive to elicit any further evidence that was available.

4. The investigation of these allegations has taken an unfortunate amount of time. This is in part due to the lack of forthcoming evidence and Executive's desire to allow sufficient opportunity for the presentation of any evidence.

5. Executive apologise for the delay but assure you that this was done with good intention to allow opportunity to present evidence.

This decision in no way stops either party pursuing any outstanding grievance through an appropriate external jurisdiction should they choose to.

We sincerely hope that you can put this behind you and move forward with your working life, positively into the future."

[38] Ms Dale's reaction to this correspondence was as follows:18

"MR STEVENS: What did this letter say, Ms Dale?---The letter didn't mention anything about any report, and I was quite shocked and surprised when I received it because it states in there that my allegations were unsubstantiated and that I didn't tender any evidence in support of - this was contrary to the understanding that I had from the vice president after speaking to her, and certainly contrary to the second report that I've now received.

Did the - what decision did you make as a result of this letter?---Again, I - to pursue the matter further, as it states in the second-bottom paragraph, I realised that again I needed a copy of both of the reports to pursue the matter further, and I asked for copies again."

[39] And later:19

"How can you say that this is a more conclusive document than the first set of allegations and disregard the report from the first set of allegations?---Well, certainly, the fact that Dr Dettwiller suggests that her recommendation is that the matter should be forwarded to the Anti-Discrimination Commission without delay and that she says not to do so is to deny both parties natural justice and that the council may have failed in its duty of care. I think that's a fairly conclusive and hard-hitting report."

[40] Despite requests, neither the first report or Dr Dettwiller's report were provided to Ms Dale, prior to this hearing (see Executive Minutes of 28 May 2007).

[41] The applicant referred to Clause 6.1 Dispute Resolution20 of the Policy and Procedures Manual, which provides for the complainant to:

"Have access to any relevant documentation which is produced once the matter is being investigated."

[42] Mr Jones' evidence on this point was:21

"As I said, the first document was offered. We were very concerned that - obviously internal union issues are very interesting to outside bodies, and we wished to maintain this information as much as we possibly could in-house, and deal with it in-house. Second - the second set of allegations, it was quite clear from the brief report we received from Pascale and the letter that I wrote to both Susan and Tom that we felt were unable to handle the allegations in-house, and that's why we send the letter back saying that, `If you wish to take this matter further you would have to do it through it through an external jurisdiction.'"

[43] I accept that the dispute resolution process referred to above does not cover CPSU staff. Nonetheless in a generic sense the provision of documentation to parties involved in a dispute resolution process is fundamental to procedural fairness. If documents have a confidential status they should be provided on that basis with breaches of confidentiality treated accordingly.

[44] Whilst failure to provide certain documentation in this case amounts to a breach of procedural fairness, the real question is whether the process overall was fair.

[45] I am quite satisfied that the parties were given every opportunity to provide the review panel/investigator with whatever information was considered relevant.

[46] I am also of the view that Ms Dale is overstating the significance of Dr Dettwiller's report.

[47] This report does not make any finding whatsoever. Indeed it would have been quite improper for Dr Dettwiller to make findings in that Mr Lynch was at that stage not even aware of the nature of the allegations.

[48] The report recommends that the CPSU refer the matter to the Anti-Discrimination Commission. Whilst no doubt well intentioned, this recommendation is misguided. On my reading of s.60 of the Anti-Discrimination Act 1998, it is simply not open for an employer to unilaterally refer a matter to that Commission. That is essentially a matter for the parties, a point specifically made in the correspondence of 1 May 2007. Whilst Ms Dale and Mr Lynch were, in my view, entitled to a copy of the Dettwiller report (and indeed the first report), neither was a prerequisite for a complaint to the Anti-Discrimination Commission.

[49] The allegations by Ms Dale are serious and it is a matter of regret that they remain unresolved. This Commission makes no finding or observation as to the substance of the allegations. The Commission's sole interest relates to process and the impact if any on the subsequent termination of Ms Dale's employment.

[50] I conclude that, notwithstanding the procedural fairness breach referred to above, the overall process was fundamentally fair and the outcome was not adversely influenced by the failure to provide certain documentation.

[51] The relationship, if any, between the above process and the decision to outsource the membership function is discussed in the next section.

Was the Termination a Genuine Redundancy?

[52] The decision to investigate alternative arrangements to operate membership was taken at the Executive Committee meeting on 26 February 2007 (see Minutes extract in previous section). The decision was taken in the context of Mr Lynch expressing concern as to Ms Dale's apparent failure to train other staff in MUST operations and the Executive expressing concern as to "her managerial behaviour".

[53] It is of note that this decision was taken following the implementation of the first report but before the second set of grievances lodged by Ms Dale on 5 March 2007.

[54] It would seem that the Executive noted progress in the investigation at a meeting on 30 April 2007.

[55] At a meeting on 28 May 2007 the Executive considered three options. Viz.:22

"Option 1 - No change

Option 2 - Contract services to Victorian Branch seeking redeployment option for current staff or redundancies if redeployment unsuccessful

Option 3 - Increase staffing in Membership Services"

[56] Comparative data compiled at the request of the Executive (1 May 2007) notes:23

"Whilst it will take some time to bed down new arrangements it is clear that the option of contracting membership services to the CPSU Victorian Branch could save $50k per annum but more importantly our Branch would have a guarantee of service, have access to the latest software changes and better access to information from the database."

[57] The Minutes of the 28 May meeting recorded:24

".2 Member Services

"It was moved by MJ and seconded by RF that it be strongly recommended to Council on 01.06.07 that they consider Option 2 of TL's Discussion Paper and undertake that a sound business case exists for outsourcing Member Services to Victoria Branch - motion carried."

[58] In his evidence Mr Jones said:25

"What were the reasons put forward that executive - that gave executive the impetus for investigating other options?---Well, there are a number of reasons. I think from my personal point of view, the issue of risk was a major concern. We had a situation where we had one person who had not total sole access, but certainly access to our membership database, and that authority had not been delegated down to other people, although there were people actually using the database. From what I'd heard from the Victorian branch who actually do a lot of work with MUST, with that system, they were using it for a lot more things, a lot more capabilities than what we were doing. And from what I was told, despite requests for that to happen within the CPSU, that did not happen. That was the main reason. The other reason was clearly a question of cost. It was pointed out to us that it was quite possible that it could be done cheaper through the Victorian branch, through our Victorian branch. And the other thing was, as I touched on, was we believed we could get better and more reports through the Victorian branch because they were experts on the system."

[59] And later:26

"Just by way of conclusion, Lindsay, do you consider this to be a genuine redundancy?---Yes, I do, absolutely.

And did the numerous allegations made against Mr Lynch and the union by the applicant have any bearing whatsoever on the outsourcing decision taken by council?---No, it didn't."

[60] The evidence of Mr Lynch on this aspect was:27

"And were there any other problems regarding the administration of MUST?---There was an issue which arose - I am not quite sure of the date, where I was notified by the membership office and not Susan, but Dylan, that there had been a significant number of members who had become unfinancial that had not been removed from the system, so effectively we were behaving as if we were collecting subs from them but we weren't getting the subs. We were paying out affiliations for them to other organisations as we do for all members but we weren't getting any money in. The total that they were looking at theoretically writing off was somewhere in the vicinity of $15,000, which is a significant chunk of money for an organisation like ours. I met with them to find out why this had occurred and I was basically told, "Well, we don't have enough resources or we were doing other things or, you know, this is the way it is and you know, every now and then there is this sort of purge." But we have been through these sorts of things in the past where we had put in clear processes so that really no one should ever get more than two or four weeks behind on their subscriptions and therefore these big sort of debts shouldn't build up. So there were a number of operational issues I had concerns around. I also had some concern around the reliability of being able to get information out of our membership system but also to be able to collect our income and those sorts of things, because there was quite a bit of sick leave - Susan had taken quite a bit of sick leave over 2006 and 2007. I also had an incident in February of 2007 where at very short notice Dylan notified that he would be off sick for 20 days. So my concern was without either of them there we couldn't do the business of the union. This is the central data base of the union that says where our members are and how they pay and who pays and how we contact them and without that operating and without having confident people there to do that then that raised real concerns in my mind.

What were the financial implications if both of these officers were away at one given time?---We couldn't collect our income, we literally couldn't collect our income. We certainly couldn't collect our direct debit income because that would need to be - that is something that we have to process and send out to collect in. We would presumably still get our payroll income but we wouldn't necessarily be able to reconcile it; that would have to be done - that would be a backlog of work that would have to be caught up on. If there were people leaving or not paying or whatever we would have no way of knowing that and no way of being able to follow up on that."

[61] And later:28

"Now, just to be clear, did the numerous allegations made against you and the union by the applicant have any bearing whatsoever on the outsourcing decision taken by council?---Absolutely not, they were two completely separate processes. One process undertaken by a review panel of a subset of an executive, another by the executive and by the council. Different groups of people making decisions based on the evidence before them and that was clear from the resolution that the council passed."

[62] The Council meeting on 1 June 2007 resolved as follows:29

".2 `Shifting to a Higher Gear'

After lengthy discussions, Council resolved that the provision of Membership Services will be contracted to the CPSU Victorian Branch and documented in a Service Agreement.

The two staff currently working in Membership Services, Susan Dale and Dylan Forbes will be considered for redeployment options within the union or if this is not possible, will be offered redundancies.

The Service Agreement with the Victorian Branch will detail the services to be provided, response times, the responsibilities retained by the Tasmania Branch, the fee to be paid and will ensure the Victorian Branch will provide continuity of service.

In making this decision Council has considered:

Risk management

Currently the union is reliant on one Officer to carry out many of the critical membership functions. In the absence of this Officer the union is unable to collect and/or reconcile income, output data essential to the conduct of campaigns or send bulk emails to specific target groups.

Efforts to train other staff in these tasks have proven unsuccessful over a number of years. By outsourcing the management of the database to the Victorian Branch the union gets a guarantee of service.

Modernising our systems and introducing new software

The Victorian Branch are leaders in the operation of the MUST software. They have modified their system to ensure it supports modern union practices. They have developed new software such as CASETRACKER and PROJECT TRACKER that complement and build on the base software. This makes the MUST package a far more useful product. They have developed software to assist in contacting members by email and software for conducting members surveys and operating a call centre.

By entering into a Service Agreement with the Victorian Branch to manage our MUST system we would gain access to these other developments. The system delivered through this arrangement is far more valuable than the system we are currently running and mean we can continue to move forward as Victoria develops new packages.

Improved access to data and standard reports

Access to standard reports is required so that organizing staff have the information they need to perform their jobs.

Through the Service Agreement the Victorian Branch would give us access to their extensive library of standard reports and modify them to suit our database structure. In addition they would write purpose build reports for specific projects and convert these into standard reports if required.

In reaching this decision Council were aware that the membership Manager had raised a number of grievances against the General Secretary. Whilst Council acknowledges some people could perceive a relationship between the decision to outsource these services and the grievances, the decision to outsource the service was based solely on the issues listed above. TL to speak to Susan Dale and Dylan Forbes about positions. It was moved by AD and seconded by RF to accept the above resolution - motion carried."

[63] In her evidence Ms Dale said she had no reason to doubt her security of employment.30 Her reaction to the decision was as follows:31

"Initially I was shocked angry, disappointed. I couldn't believe that I had had no prior knowledge of this, that there had been no discussions and no consultation.

MR STEVENS: Okay, thank you. Out sourcing of membership services to Victoria was the reason given, did you participate in this decision?---No.

Did you expect to?---Of course, yes.

Did you receive any personal consultation or appraisal at this stage?---No, I didn't.

Again, did you expect to?---Yes."

[64] And later:32

"I put to you that the decision on 26 February instructing the general secretary to investigate suitable alternate options for the provision of membership services came before your second set of allegations; does that make sense?---Yes.

Yes. How then can you, as the applicant in this matter, contend that the second set of allegations had any bearing on the genesis of the redundancy?---I believe that the redundancy was not a bona fide redundancy, and I believe that's evidenced by the fact that there was no prior consultation. If, as you're saying, that there was a decision made or an investigation into redundancy in February, then I can't understand why I was not consulted about this, why there was no prior discussions with myself or my union.

Do you accept that the committee of management of any organisation can take steps to investigate options without consultation?---Yes.

Very good. Do you accept that the first steps towards what eventually became a redundancy situation occurred prior to the lodging of your second set of 35 allegations?---It would appear so."

[65] In relation to consultation, the applicant relied on the following clause in the Staff Agreement:33

"1. CONSULTATION AND CHANGE MANAGEMENT

Where the employer is planning the introduction of changes in work arrangements or practices that are likely to have significant effects on employees, the employer will notify the employees who may be affected by the proposed changes, and their unions, prior to the implementation or trialling of the change(s).

The employer will consult with the employees affected and the relevant union(s), and discuss the introduction of any changes, the effects the changes are likely to have on employees, measures taken to avoid or lessen any adverse effects on employees, and will give prompt consideration to matters raised by employees or their union in relation to the change(s). These discussions will commence as soon as practicable after the employer believes that the change(s) may be necessary."

[66] Mr Lynch maintained that the Union did comply with the Staff Agreement in that consultation occurred after the decision was taken but prior to implementation. He said:34

"So my question to Mr Lynch is can he please outline where that obligation in the staff agreement was met?---The process was undertaken by council to consider the options. They made a decision. I then communicated that to the staff members involved and tried to meet as much of this in doing that as I could, that's why we offered them the opportunity to come back to us with ways in which we could mitigate the effect on them or minimise the impact on them.

The two paragraphs I have just exhibits, especially the first one, relate to prior to the introduction of any changes. From your answer there I put it to you it doesn't seem like that occurred?---Prior to the implementational trialing of changes?

Sorry?---Prior to the implementational trialing of changes certainly the - - - 

At the time though didn't you issue the letter to Ms Dale it was already decided?---The decision was taken prior to notifying her, yes.

But the decision to advise or involve Ms Dale and her union didn't take effect until after that decision had been effectively made?---But prior to the implementational trialing of the changes."

[67] In SDAEA v WD & HO Wills Holdings Ltd,35 Sams DP discussed the authorities that have established certain principles going to aspects of redundancy. On the notion of consultation he referred to the AIRC TCR case,36 whereby the Full Bench said:

"59. ...

Nevertheless we believe that it is of fundamental importance to involve employees and their representatives in the problems of redundancy as soon as a firm decision has been taken that retrenchments may be necessary, and we are prepared to make an award provision to that effect."

[68] Sams DP went on to review a number of seminal test case decisions in the NSW jurisdiction culminating in a general standard in NSW awards. The clause includes the following:

"60. ...

(i) Employers duty to notify:

(a) Where an employer has made a definite decision to introduce changes in production, program, organisation, structure or technology that are likely to have significant effects on employees, the employer shall notify the employees who may be affected by the proposed changes and the union to which the(sic) belong.

(b) ...

(ii) Employer's duty to discuss change:

(a) The employer shall discuss with the employees affected and the Union to which they belong, inter alia, the introduction of the changes referred to in subclause (i), Employers duty to notify, of this clause, the effects the changes are likely to have on employees and measures to avert or mitigate the adverse effects of such changes on employees, and shall give prompt consideration to matters raised by employees and/or the Union in relation to the changes.

(b) The discussion shall commence as early as practicable after a definite decision has been made by the employer to make the changes referred to in subclause (i) of this clause.

..."

[69] A similar approach was adopted by this Commission in the State TCR case.37 In relation to consultation the Full Bench said:

"Accordingly we will include in the award a suitable prescription qualified by the words `where reasonably practicable'. The purpose of this provision will be to enjoin employers to consult with their employees or their organisations after a decision has been taken to introduce new technology or change likely to affect the jobs of employees to the extent that positions would become redundant. It will also apply where other persons have the nature of their duties significantly changed as a direct consequence of the voluntary introduction of new equipment or procedures."

[70] The recurring theme in these authorities is that the requirement to consult commences after a firm decision to introduce change is made, but prior to implementation.

[71] Whilst using slightly different language the CPSU Staff Agreement, in my view, reflects the same sentiment. The clause requires the employer to consult when "planning the introduction of work changes ..." and prior to the "implementation or trialling of the change(s). These discussions will commence as soon as practicable after the employer believes the change(s) may be necessary".

[72] In the instant case that decision was taken on 1 June 2007 and consultations commenced on 4 June. Prior to that date the employer was exploring alternatives, one of which was the retention of the status quo.

[73] Whilst redundancies are invariably a matter for regret and often impose hardship on an individual through no fault of their own, it is simply not practical, and may well be counterproductive, to impose a requirement to consult during the exploration stage.

[74] I conclude that the CPSU did not breach the Staff Agreement by failing to consult prior to taking the decision to outsource the membership function.

[75] Having reviewed the evidence I have reached the conclusion that this matter involves a genuine redundancy and that it would be quite wrong to conclude that it was in some way a sham and a consequence of the grievances raised by Ms Dale against Mr Lynch. I have reached this conclusion for the following reasons:

· The decision was based on an overwhelmingly sound business case.

· The Council of the Union, not Mr Lynch, made the decision.

· Another employee was also made redundant as a consequence of the decision. There was no evidence that Mr Forbes had lodged grievances against or had an unsatisfactory working relationship with management.

· The decision was consistent with a management strategy to reduce the ratio of administrative staff to operational staff. For example, the Business Manager role had previously been outsourced.

· The cost of managing the membership function was relatively high compared with comparable union branches.

[76] I am prepared to accept that concerns expressed as to Ms Dale's "managerial behaviour" at the February executive meeting, may have had some impact on the timing of the decision to explore alternatives, although I fall short of making a finding to that effect. There is frequently a trigger in a decision-making process which brings something forward from what it might otherwise have been. However this is a long way distant from concluding that the grievances raised by Ms Dale in some way brought about a decision which was clearly open to the Union on the basis of a sound business case.

Accordingly, the applicant's contention that she was unfairly terminated is dismissed.

Did Ms Dale Unreasonably Decline on Offer of Alternative Employment and, if so, what are the Consequences in Terms of Redundancy Pay?

[77] The Council decision to outsource the membership function made it clear that Ms Dale and Mr Forbes were to be considered for "redeployment options within the union or if this not possible, will be offered redundancies."38

[78] The letter to Ms Dale dated 4 June reflected this intention:

"The CPSU will actively seek alternate employment for you and will assist you by offering a skills enhancement program, training or assistance in interview techniques and CV preparation. If there is anything specific you would like considered please let me know."

[79] It transpired that Mr Forbes was offered a position at a lower level, an offer he declined.

[80] In relation to Ms Dale, Mr Lynch said:39

"Were there any internal opportunities for the applicant?---From the start there was always going to be a position that we would still retain in Hobart. It was likely to be about a half-time position. It would be basically data input, so it would be entering new members and changes to the database that we became aware of in Hobart. I guesstimated the position, without going into a huge amount of detail, 'cause we were still working with Victoria then as to exactly what we would do and exactly what they would do, but we guesstimated it would be about a CPSU officer level 5. Susan I think at the time was a level 15, so I would have thought it was - would have been insulting to have offered her that position. I did eventually increase the level of that I think to a level 7. And when I finally got all the roles that we could do in Hobart, not necessarily that we would, but that we could do, so I was able to put that position to Dylan as a genuine alternative. He was a level 9; I offered him a level 7, but he declined that. I don't think - to the - there were no other jobs in Hobart in the CPSU that I could offer to Susan commensurate with her skills and with her level."

[81] Mr Stevens submitted that notwithstanding Mr Lynch's view on the suitability of the alternative positions, they should have been offered to Ms Dale. Mr Stevens also noted that a number of staff on fixed term contracts had been converted to permanent employment at the same time Ms Dale was made redundant. Mr Lynch submitted that these were specialist roles, quite unsuited for Ms Dale, and it was an unsatisfactory HR practice to rollover fixed term contracts if permanent employment was available.

[82] It is clear that Ms Dale's industrial representative at the time (the ASU) was aware of the CPSU position. On 17 August 2007 the ASU wrote to Mr Lynch stating:40

"It is my understanding from our discussions that redeployment within your organisation is not a viable alternative. Could you please confirm that this understanding is correct?

Assuming this to be so, I presume Ms Dale shall have an entitlement to a redundancy payment of no less than that offered during our meeting of 4 June 2007 and confirmed by your correspondence of same date."

[83] Mr Lynch responded on 21 August:41

"I can confirm that no opportunities exist to redeploy Susan into a position at the CPSU commensurate with her skills and salary. We have investigated all options. The only vacant position we currently have is for a level 5 receptionist and that would not be suitable for Susan."

[84] In relation to the HACSU position, Mr Lynch said:42

"I also went out of my way to try and find alternative work within the union movement, and I can't express how pleased I was when one of my colleagues from another union said to me, "I understand you've got people who have certain skills and they're excess to your requirements. I'm desperately in need of somebody with those sorts of skills. You know, what's the story?" So I was really pleased to be able to put Susan in contact with HACSU, who were keen on employing somebody in a similar role to the role she'd been filling at the CPSU, and start immediately. This was I believe about mid-June. They wanted someone - they were desperate for someone to start immediately."

[85] On 20 June Mr Lynch sent the following e-mail to Ms Dale.43

"Susan,

Apologies I have not caught up with you this week but I have been flat out.

I understand Mat made you aware of the job opportunity at HACSU and that you have spoken to Chris Brown. I spoke to him this morning and he seemed very impressed with your skills and as I understand it he offered you a position. Mat told me you were concerned that the HACSU position was at a lower level than your current position. I understand however that Mat told you I would be willing to consider maintaining your current salary should you decide to accept the HACSU position.

I am a strong believer that an employer in my position should leave no stone unturned to find suitable alternate employment for employees who are displaced as a result of the type of restructure we are undergoing. That is why I am now formally offering to maintain you(sic) salary at its current level for 12 months if you decide to take the HACSU job. I will also honour your long service leave entitlement by paying HACSU to accept our current liability.

Following discussions today I am much clearer on how the transfer of Membership services will occur. A significant part of your current role will be transferred through July and by mid-August I expect the Victorian Branch to be undertaking the whole role. I explain this so it is clear to you that whilst I will guarantee your employment with the CPSU through to the end of September you will be required to perform other duties for a significant proportion of that time.

I am not sure if you have sought advice from Mr Dodds about the implications of rejecting a suitable alternate position but I suggest you do so to avoid any confusion in the future. I strongly urge you to seriously consider the HACSU option. It is similar work in a similar environment with an employer who is keen to recruit you and I am willing to assist to make it more attractive. Let me know if you have other suggestions that may make this a more palatable option.

Yours,"

[86] Ms Dale declined the position at HACSU. She said:44

"You subsequently went on to reject this position, can I ask why?---Because of family responsibilities, extra hours, travel, etcetera."

[87] Later, in response to a question from the Commission, Ms Dale said:45

"THE COMMISSIONER: Yes. Ms Dale, you've indicated that you didn't accept the HACSU position for family reasons, or family responsibilities I think you term was. I don't wish to pry unnecessarily into your personal circumstances, but are you able to indicate what was different at HACSU to that which was applicable in your position with CPSU which impacted adversely on those family responsibilities?---Certainly the - it was an additional three hours per week, the job at HACSU, and it was also the location, in New Town. I've - I have to pick my son up from after-school care which is in West Hobart, so - and travel would be a problem there, and not to mention the differences in salary as well.

Yes?---But certainly family responsibilities were difficult."

[88] According to Mr Johnston, the HACSU office is closer to Ms Dale's home than is the CPSU. Questioned on this aspect, Ms Dale said she does not drive and after school child care was an issue.

[89] Mr Lynch said that prior to the hearing, the only reason Ms Dale had given for the rejection of the HACSU position was salary. He was not informed of any issue concerning "family responsibilities" and as such, he had no opportunity to address it.

[90] In SDAEA v Wills Holdings, Sams DP reviewed a range of authorities and concluded:

"66. A body of well settled contemporary industrial principles has developed from these, and many other, authorities. They may be summarised as follows. In redundancy situations an employer is obliged to:

1. give reasonable notice to employees and/or their Unions;

2. adequately consult with employees and/or their Unions on the impact of the proposed changes;

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

4. ensure such options are fairly offered to the affected employees;

5. provide reasonable standards of redundancy benefits;

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

7. ensure employees nominated for redundancy are fairly selected on an objective and unbiased basis.

67. Notwithstanding the employer's obligations, there are certain reciprocal obligations on employees when confronted with genuine efforts by the employer to minimise the impact of potential redundancy. These obligations include:

a) a willingness to participate in consultation with the employer;

b) genuinely participating in exploring alternatives to redundancy;

c) not unreasonably refusing to accept retraining, alternative employment, redeployment or relocation."

[91] The Deputy President referred to Clothing and Allied Trades Union of Australia v Algray Pty Ltd46 in which Merriman C noted with approval the Full Bench decision of the South Australian Commission in Milk Processing and Cheese Manufacturing Etc (Appeal):

"68. ...

Like the Australian Commission, we agree that, if employment of a suitable nature and returning a comparable remuneration can no longer be found or is not arranged for by the employer, then it is appropriate to require special provision to be made. It goes without saying that any employee who unreasonably either declines such employment or fails to cooperate in mitigating any disadvantage in an appropriate manner can scarcely be heard to seek the same special treatment as those who do.

I certainly support this decision that in a redundancy situation where the employer is genuinely attempting to find alternative employment an employee should cooperate in every way to accommodate the alternative employment efforts."

[92] Sams DP went on to observe:

"93. By and large, the factual position is not disputed. The uncontested evidence is that Imperial was offering employment to former employees of Wills on terms `similar' or `no less favourable than' their existing entitlements. These conditions included a redundancy package which can only be described as generous. Was it reasonable for Ms Campitelli and Mr Robertson to refuse to accept the offers of alternate employment?"

...

"110. Sadly, there is only one underpinning and unstated reason why the employees refused the offers of employment with Imperial. Blind Freddy could see it. I have no doubt their only motivation was that they wished the generous redundancy package to be applied to them, even though they were not redundant.

111.This Commission will give no comfort to claims of redundancy benefits where there is no lawful redundancy. While I appreciate that this was not the claim eventually pursued by Mr Rogers, it was most certainly the underlying theme throughout this entire case.

112. In the face of guaranteed reasonable alternative employment, their choice of pursuing a claim of unfair dismissal on such an obviously flawed basis was a risky gamble indeed. It was a choice that was freely open to them.

113. There is no basis for finding the terminations of employment were harsh, unreasonable or unjust, either substantively or procedurally.

114. I am moved to say, it is a tragedy that two competent and experienced employees have lost an opportunity for ongoing employment and have forfeited their continuity of service accumulated over twelve years.

125. However, in the circumstances, the Commission declines to make any orders under s136 of the Act.

116. These proceedings are concluded."

[93] Whilst there is now a statutory entitlement to a safety net redundancy payment, unless otherwise determined by the Commission, the general approach to redundancy issues remains unchanged. Employers are to be encouraged to find suitable alternative employment for individuals made redundant, and it is incumbent on the individual to cooperate and not unreasonably reject suitable alternative employment. To do so places in jeopardy an entitlement to redundancy pay. However the circumstances of each case must be closely examined.

[94] I am satisfied from a review of the Position Descriptions47 that Ms Dale was well suited to the HACSU position. Certainly the salary was somewhat lower, but Mr Lynch had offered to maintain Ms Dale's existing salary for a period of 12 months. The CPSU also offered to transfer the Long Service Leave accrual.

[95] Other leave accruals had been exhausted and hence were not an issue. However I do note that there was no offer to protect Ms Dale's contingent accrual against a future redundancy. In other words, had Ms Dale accepted the HACSU position, and subsequently made redundant at some point in the future, the CPSU service would not, in all likelihood, be counted. This is a serious consideration, particularly for long serving employees, and is one significant point of difference with Wills.

[96] With the 12 months' maintenance offer, the salary differential can at least in part be discounted. It would seem therefore that Ms Dale's concern with the HACSU position amounted to an apparent extra three hours per week, and unspecified child care issues.

[97] Ms Dale appeared most reluctant to enlarge on these apparent problems, even during the hearing, preferring to rely on the broad heading of "family responsibilities", without substantiation.48

[98] With respect, this position is misguided. In an age when employers are expected to implement family friendly policies, there is reciprocal obligation on employees to substantiate their concerns. Failure to do so means that even the most well intentioned employers have no opportunity to address these concerns.

[99] In the instant case it is difficult to identify what more the CPSU could have done.

[100] Did then Ms Dale unreasonably reject an offer of suitable alternative employment?

[101] Not without some hesitation, I decline to find that she did so. Certainly there was a potential salary issue after 12 months. Whilst both positions were full-time, it seems that HACSU involved an additional three hours per week. There was the loss of recognition of CPSU service in a future redundancy (although Ms Dale did not raise this), and there was the unsubstantiated childcare issue.

[102] In the circumstances I am prepared to accept that Ms Dale had reason to reject the HACSU position, although she chose not to clearly articulate the rationale for this decision.

[103] It follows that Ms Dale, in rejecting the offer, has not created a situation whereby the Commission might consider modifying or removing a redundancy entitlement that would otherwise apply.

What is the Appropriate Calculation of the Redundancy and Notice Entitlement?

[104] The correspondence of 4 June 2007 states:

"In the end however, if redeployment options are not forthcoming you will be entitled to a redundancy calculated on the basis of 4 weeks notice and 2 weeks for each year of service.

The timeframe for implementing this decision has some flexibility. If you found alternate employment in the short term arrangements could be fast tracked to get the Victorian Branch to take over. Otherwise I would be willing to consider a phased change over between now and the end of September 2007 to maximize the period you would have to get alternate work."

[105] As events transpired, Ms Dale's employment came to an end on 24 August and she was paid until the end of September 2007. In my view this does not have any bearing on the proper calculation of entitlements. However, as the foreshortening of actual employment was at the behest of the employer, after Ms Dale was previously told she would be employed until the end of September, all calculations of accrued entitlements should be done on the basis that employment was deemed to cease on 30 September 2007.

[106] There are two issues in contention:

Notice

[107] The respondent contends that the period of four weeks' notice must reasonably be embraced in the extended notice period until the end of September 2007 as advised in the letter of 4 June.

[108] Whilst this is a reasonable argument based on merit, it is not what the 4 June letter says. That correspondence quite clearly states that absent a redeployment option, Ms Dale "will be entitled to a redundancy calculated on the basis of 4 weeks notice and 2 weeks for each year of service".

[109] The period of notice is covered in the next paragraph and covers a quite different time frame.

[110] Whilst it may have been the CPSU intention that the four-week notice period be subsumed in the period of extended notice, Ms Dale, on reading the 4 June correspondence would reasonably have concluded that the four weeks was part of the redundancy entitlement and additional to the extended period of notice.

[111] I determine accordingly.

Redundancy Payment

[112] The 4 June correspondence refers to a redundancy "calculated on the basis of ... 2 weeks for each year of service".

[113] The respondent contends that the years of service should be calculated on the basis of full-time equivalent years. Ms Dale initially worked 25 hours per week. This was increased to 30 hours per week from 20 August 2003 and up to 35 hours pw from 1 September 2004. This equates to an equivalent of 6.73 years, rather than eight years on a years served basis.

[114] The respondent contends that this is consistent with the practice in the State Government Employment Rationalization Program (ERP). Given the relationship of the CPSU with State Government employment, this is not an unreasonable preposition.

[115] However a closer scrutiny of the ERP reveals that it is many faceted.

[116] For example, the weeks per year of service varied significantly (2 or 3 weeks' salary for each year of service to a max. of 48 weeks' to 72 weeks' pay) depending on RBF contributor status. In some cases the Public Servants Retiring and Death Allowances Act 1925 conferred additional benefits. In each case there was an Incentive Payment of $5000 for employees who signed within a specified time and agreed to separate at a time specified by the employer. I also note in passing that the four weeks' "salary" (or 12 weeks as the case may be) was very definitely part of the severance payment and not notice to be worked by the person concerned.

[117] There was insufficient evidence before the Commission to determine which category, if any, of the ERP best applied to Ms Dale. The ERP was a program designed to meet a specific set of circumstances and should not be slavishly applied to other circumstances. Nor should elements be cherry picked to support certain arguments.

[118] This Commission has not as a general rule calculated redundancy based on full-time equivalence. Nor does s.47AH of the Act recognise the concept.

[119] In my view the redundancy payment should be calculated on the basis of two weeks' pay for each completed year of service, making a total of 16 weeks' pay.

ORDER

Pursuant to section 31 of the Industrial Relations Act 1984, I hereby order that The Community and Public Sector Union (State Public Services Federation Tasmania) Inc. pay to Susan Marion Dale, the following:

1. A redundancy payment based on four weeks' notice plus two weeks' pay for each completed year of service, i.e. a total redundancy payment equivalent to 20 weeks' salary.

2. All accrued entitlements are to be paid as if Ms Dale completed employment on 30 September 2007.

The above payment is to be made not later than 5.00pm on Friday 2 November 2007.

 

Tim Abey
COMMISSIONER

Appearances:
Mr K Stevens, for and with Ms S M Dale
Mr M Johnston, with Mr T Lynch (29/8/07) and Mrs K Taylor (18/9/07), for The Community and Public Sector Union (State Public Services Federation Tasmania) Inc.

Date and Place of Hearing:
2007
August 29
September 6, 18
Hobart

1 Exhibit R1
2 Exhibit R1
3 Exhibit R6
4 Exhibit R2
5 Exhibit R8
6 Exhibits A6 and R11
7 Exhibit R8
8 Exhibit A2
9 Transcript PN 41
10 Supra
11 Exhibit R8
12 Exhibit R10
13 Exhibit R8
14 Exhibit R6
15 Exhibit R2
16 Exhibit R8
17 Exhibit A6
18 Transcript PN 135/6
19 Supra PN 196
20 Exhibit A7
21 Transcript PN 745
22 Exhibit R8
23 Supra
24 Exhibit R8
25 Transcript PN 686
26 Supra PN 698/9
27 Supra PN 371/2
28 Transcript PN 440
29 Exhibit R8
30 Transcript PN 66
31 Supra PN 72 - 76
32 Transcript PN 282 - 285
33 Exhibit A7
34 Transcript PN 500 - 504
35 [2000] NSWIRComm 98 (9 June 2000)
36 8 IR 34
37 T125 of 1985
38 Council Minutes 1/6/07
39 Transcript PN 422
40 Exhibit R15
41 Exhibit R16
42 Transcript PN 425
43 Exhibit R7
44 Transcript PN 118
45 Supra PN 315/6
46 31 IR 365
47 Exhibits R3, R4
48 Transcript PN 320