Employer found to have taken adverse action against Union delegates by making them redundant
In the recent Federal Circuit and Family Court Decision of Australian Manufacturing Workers Union v United Lift Services Pty Ltd [2023] FedCFamC2G 275 (17 April 2023), it was found that the employer took adverse action against two union delegates (employees) when it retrenched them 4 hours before the deadline for voluntary redundancies.
The two employees, who were also delegates of the Australian Manufacturing Workers Union (AMWU) and the Communications, Electrical and Plumbing Union of Australia (CEPU), issued proceedings against United Lift Services (employer) after it dismissed them 4 hours before the deadline for employees to volunteer for a redundancy.
Background Facts
On 18 June 2021, both employees were elected as delegates of their respective Unions. Both employees alleged that they raised numerous concerns in relation to workplace issues with the employer including entitlements to rostered days off (“RDOs”), a 36-hour working week, safety concerns and entitlements pursuant to the Enterprise Agreement (EA). The Court did note that the relationship between the Employer and the respective Union delegates was poor and on at least one occasion did involve a terse telephone exchange.
On 20 July 2021, the employees received an email from the employer, advising that the company was making two roles in the construction division redundant and sent out an expression of interest in relation to voluntary redundancy. If an employee was interested they were to contact their supervisor by 5pm on 28 July 2021. At 1pm on 28 July 2021, the two employees each received a letter that the employer had made their roles redundant.
The decision to make them redundant was made 4 hours prior to the deadline and in the middle of the Covid-19 lockdown period in NSW.
Decision and Reasoning on Appeal
The employer claimed that that prior to making the two employees redundant, that a selection process was engaged in order to determine which employees should be made redundant. The selection process involved assessing and then completing an employee skills matrix based on the criteria of safety, peers, staff, customer relations, technical skills and quality of works. There was also an argument that due to Covid-19, the volume of work was reducing.
The employees argued that they were scored unfavourably by their employer because:
They were members of their respective unions and workplace delegates;
They exercised workplace rights; and
They engaged in industrial activities and acted in the role of workplace delegates representing the interest of Union members.
In other words, the employees argue that the employer took adverse action against them and thereby contravened Section 340 of the Fair Work Act (Act).
The Court ultimately found in favour of the employees in that adverse action was taken against them. The Court found as follows:
No real consultation as per the major change clause under the EA was taken.
It was implausible for the employer to argue that no volunteers were to come forward for redundancies and hence why the decision was taken pre-emptively;
The employees had made protected complaints and this included the request for a 36-hour week, which the employer did not want;
There was no indication contrary to the Covid-19 lockdown that workflows were decreasing; and
At least one of the employees was deliberately marked down on the matrix in order to justify the decision to make redundant. In other words, the scoring used in the matrix did not properly represent his skills and attributes as compared to the other workers within the construction division.
Accordingly, the Court was satisfied that the employer contravened ss 340 and 346 of the Act and that the matter be held over for Directions on the appropriate penalties to be imposed.
Key Takeaways
The key takeaway for employers is to ensure that when considering redundancy related issues that a careful and well-thought-out process that involves consultation and notification takes place. The process must also be one that cannot be linked to genuine workplace concerns raised by employees and those employees in turn being subject to redundancies.
It is also prudent that employers take the necessary time to make these decisions as they need to consider employee feedback. In short, there is no fast-tracking this process.
If you require assistance with redundancy related issues similar to this case, please contact:
Article prepared by:
Jim Babalis
Special Counsel
T 03 5225 5205
E jbabalis@ha.legal
Sonia McCabe
Senior Associate
T 03 5226 8558
E: smccabe@ha.legal
Matthew Synoradzki
Lawyer
T 03 5226 8542
E msynoradzki@ha.legal
