Construction, Forestry, Mining and Energy Union (New South Wales Branch) (on behalf of Daryl John Bates) and G. James Safety Glass Pty Ltd [2007] NSWIRComm 129 (31 May 2007)

Last Updated: 13 July 2007

NEW SOUTH WALES INDUSTRIAL RELATIONS COMMISSION

CITATION : Construction, Forestry, Mining and Energy Union (New South Wales Branch) (on behalf of Daryl John Bates) and G. James Safety Glass Pty Ltd [2007] NSWIRComm 129



FILE NUMBER(S): IRC3284

HEARING DATE(S): 12 February 2007

DATE OF JUDGMENT: 31 May 2007
PARTIES:
APPLICANT
Construction, Forestry, Mining and Energy Union (New South Wales Branch) (on behalf of Daryl John Bates)

RESPONDENT
G. James Safety Glass Pty Ltd

CORAM: Sams DP


CATCHWORDS: Application for reinstatement of injured worker - worker medically unfit as glass cutter tradesperson - light duties - worker transferred to office duties - no dispute as to injury or medical certificates - downturn in the industry - need for redundancies - selection process - absenteeism - skills and capacity to learn - s 40 top-up insurance claim - lack of training - whether worker genuinely redundant - meaning of 'substantial and operative cause' in s 95 of the Act - whether employer has a position which is reasonably available - jurisdiction of Commission - transfer of provisions to Workers' Compensation Act 1987.

Held; jurisdiction of Commission established - transfer of provisions to Workers Compensation Act no impediment to claim - redundancy has same meaning as dismissal - no authority as to meaning of expression "substantial and operative cause" - dictionary definitions - expression not read down - injury must be primary or principle cause of dismissal or one given the most weight - financial difficulties accepted - genuine need for redundancies - other employees made redundant - position of order checker shared between employees - flaws in selection process - no warning or counselling as to workers' record - s 40 top-up claim not a factor - criticism of failure to notify and consult - breach of Award - failure to honour moral obligations and contemporary industrial standards - injury not the 'substantial and operative cause' of the dismissal - respondent successful in rebutting presumption - application dismissed.

LEGAL REPRESENTATIVES

APPLICANT
Mr S Marshall, Industrial Officer
Construction, Forestry, Mining and Energy Union (New South Wales Branch)
RESPONDENT
Mr C Ban, Solicitor
G. James Safety Glass Pty Ltd

CASES CITED: Australasian Meat Industry Employees' Union, Newcastle and Northern Branch (on behalf of B Fisher) and Inghams Enterprises Pty Ltd [2006] NSWIRComm 202
Cansino v South Western Sydney Area Health Service (1999) 130 IR 1
Construction, Forestry, Mining and Energy Union (New South Wales Branch) on behalf of Scott Anthony Elwell and Cobar Mining Services Pty Ltd and Anor [2004] NSWIRComm 32
Endeavour Coal and others v CFMEU [2007] NSWIRComm 70
Fabros v Hotel Intercontinental Sydney (1993) 53 IR 193
Riley v WorkCover Authority of New South Wales (2006) 151 IR 396
Shop, Distributive and Allied Employees Association, New South Wales v WD & HO Wills [2000] NSWIRComm 98
Transport Industry- Mutual Responsibility for Road Safety (State) Award and Contract Determination (No. 2), Re (2006)158 IR 17
Unions NSW v Carter Holt Harvey Wood Products Australia Pty Ltd (2006) 149 IR 361
AWARDS
Clerical and Administrative Employees (State) Award 296 IG 619
Glass Workers (State) Award 324 IG 84

LEGISLATION CITED: Workplace Relations Amendment ('Work Choices') Act 2005 (Cth)
Industrial Relations Act 1996
Industrial Relations (Further Amendment) Act 2006
Interpretation Act 1987
Workers' Compensation Act 1987



JUDGMENT:

- 1 -

INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

CORAM: SAMS DP


31 May, 2007

Matter No IRC06/ 3284

Construction, Forestry, Mining and Energy Union (New South Wales Branch) (on behalf of Daryl John Bates) and G. James Safety Glass Pty Ltd

Application by Construction, Forestry, Mining and Energy Union (New South Wales Branch) (on behalf of its member Daryl John Bates) for reinstatement of an injured employee pursuant to section 93 of the Industrial Relations Act 1996

DECISION
[2007] NSWIRComm 129

INTRODUCTION

1 These proceedings have been brought by the Construction, Forestry, Mining and Energy Union (NSW Branch) ('the Union') on behalf of its member, Mr Daryl John Bates. The proceedings are under Part 7 Ch 2 of the protection of injured worker provisions of the Industrial Relations Act 1996 ('the Act') and seek Mr Bates' reinstatement to a position at G. James Safety Glass, Smithfield ('the respondent') following his termination of employment on 28 August 2006 on the grounds of redundancy. At the time of his termination of employment Mr Bates had been permanently employed in a clerical capacity after being medically cleared for modified duties on 22 April 2005 following a workplace injury in 2003. At that time he had been employed as a tradesperson glass cutter under the terms of a company enterprise agreement underpinned by the Glass Workers (State) Award.

2 In accordance with the requirement in s 92 of the Act, on 19 September 2006, the Union wrote to the respondent and sought Mr Bates' reinstatement. When reinstatement was refused, the Union filed an application for the reinstatement of an injured worker, pursuant to s 93 of the Act. I shall return to the relevant legislative provisions later in this decision.

3 The application was listed for conciliation and directions on 31 October 2006 and adjourned on that occasion in order for a medical assessment to be undertaken of Mr Bates by the respondent's workers' compensation insurer, Allianz Insurance. The respondent also undertook to examine its forward financial position to establish if there was any opportunity to re-engage Mr Bates. The matter was re-listed on 21 November 2006. Mr Marshall, for the Union, informed the Commission that the insurance company had refused to organise a medical assessment of Mr Bates and the respondent had also declined to do so.

4 Mr Ban, for the respondent, advised that the respondent's financial position was no brighter than before. In any event, the respondent maintained that Mr Bates had been genuinely made redundant and there was no position available for him, irrespective of his medical condition. Mr Ban submitted that Mr Bates' "injury was not a substantial and operative cause of the dismissal" and the presumption referred to in s 95(2) of the Act had been successfully rebutted.

5 Mr Marshall disputed the respondent's claim as to the rebuttal presumption in s 95(2) and sought evidence that Mr Bates' position was truly redundant. Even if it was, Mr Marshall maintained that Mr Bates had been unfairly selected for redundancy and that the real reason for his selection was his injury. In order for the matter to be determined, the Commission issued directions for the arbitration of the claim.

BACKGROUND

Short Chronology

· Mr Bates was first employed by the respondent as a truck driver on 24 September 1997.

· In 1999 Mr Bates undertook an adult apprenticeship and became a qualified tradesperson in 2003.

· Mr Bates sustained a workplace injury in March 2003 and had an operation in July 2003 and a second operation in August 2004.

· Mr Bates returned to work on light duties on 26 October 2004.

· On 22 April 2005 Mr Bates received a medical certificate which indicated his fitness for permanently modified duties (no lifting over 15kg).

· On 29 November 2005 Mr Bates received nine weeks notice of transfer to office duties.

· Mr Bates worked two days cutting templates in the lead up to Christmas 2005.

· In January 2006 Mr Bates accepted full time clerical duties.

· In July 2006 Mr Bates and another employee, Mr Heath Bulgin received s 40 top-up workers' compensation payments.

· On 28 August 2006 Mr Bates and four other employees were made redundant without notice.

· Mr Bates continues to receive workers' compensation.

The termination of employment

6 Mr Bates was provided with the following letter of termination:

We regret to advise you that due to a continuing downturn in our workload we are forced to reduce out workforce and unfortunately we will have to terminate your services.

We are sorry that this situation had developed and we have tried in many ways to avoid the need to reduce our workforce, or to find alternative employment for you within our group of companies. Unfortunately there does not seem to be any other alternative in the current environment.

Your employment with us will cease as of the time that you receive this letter.

You will receive payment within the next three working days for:

§ All hours worked until the end of your normal shift today.

§ Five weeks pay in lieu of notice.

§ Twenty weeks pay as Severance Pay.

§ All accrued Holiday Pay.

§ Any accrued Long Service Leave.

In calculating your Notice Period and Severance Pay we have taken into account your age and your length of service with the company as required in the Award.

You will be given the opportunity of reemployment with us in the future when out workload improves. However we cannot predict when or if that situation is likely to arise.

Again we apologise for the action we are forced to take and assure you we will assist you in any way with verbal references and advice to other potential employers or any other appropriate matters.

7 In a subpoenaed document dated 28 November 2006 the respondent's General Manager, Mr Hayes had said:

I believe our first response to the Commission should only address the vague items mentioned in the Application for Reinstatement and should only do so in the same vague terms.

1. Mr Bates was made redundant as part of an overall staff reduction plan.

2. Each department was assessed on its merits to decide who to retain or to let go.

3. Mr Bates was assess (sic) for redundancy as part of the Clerical staff.

4. Mr Bates' clerical work has now been shared amongst several employees some of whom are also performing work in the factory.

...

Daryl Bates was amongst those selected for retrenchment because of

§ His lack of skills in the office environment.

§ His perceived lack of potential to improve his clerical skills.

§ His poor record of attendance for the previous year.

· 14 absences for sick leave

· 5 absences for carers leave

· 1 absence due to arriving late
· 1 absence due to leaving early

· 9 other absences due to Workers' Compensation

8 It was not in dispute that Mr Bates received no notice of his termination of employment and obviously was not consulted (nor was the Union) as to other options rather than redundancy. Nor was he given an opportunity to defend himself in respect to the above reasons cited for his selection for redundancy.
THE EVIDENCE

9 Much of Mr Bates' evidence dealt with the circumstances surrounding his injury at work and his subsequent return to work on light duties. This evidence was critical of the respondent's alleged failure to provide safe working conditions. However, there was no dispute that Mr Bates was injured at work and returned to work on light duties on 26 October 2004. Shortly thereafter he was employed as an order checker. This work involved checking on the progress of orders, measuring templates, doing minor pick-ups of parts for machines and occasionally driving the forklift. Mr Bates said he was constantly asking his supervisor for his old light duties work, but this was always refused, except for a few days in the weeks leading up to Christmas 2005 when he cut templates in the factory.

10 Mr Bates claimed that the respondent had offered him no occupational rehabilitation or training on computer controlled equipment. He said that at the same time employees were being made redundant, regular overtime was being worked, although it was never offered to him. Since his dismissal Mr Bates had applied for numerous alternative positions. However, no one would employ him with his present restrictions and medical history.

11 Mr Bates said that all orders need to be checked and this requirement had not changed. The work involved hundreds of orders per week. When he was made redundant, a Mr Brett Morvan, who had a 5kg lifting limit, was brought back to check orders and had been given work denied to him, such as cutting templates and louvres and working overtime. Mr Bates questioned why he would not have been retained with his 15kg limit. He claimed that his former job had not been shared around, as claimed by the respondent. Mr Morvan performs the work and had been trained to operate computer cutting equipment.

12 One of the criterion used by the respondent for the selection of employees to be made redundant was their absenteeism records. In 2006 Mr Bates had 14 days absent. He was ranked second out of 66 employees for poor attendance.

13 Mr Bates responded to the respondent's reliance on his sick leave record by giving an explanation for each instance of leave from December 2005. In most cases, he had provided doctor's certificates or converted sick leave to carer's leave. In any event, he had not exceeded the leave entitlement or breached the sick leave requirements under the terms of the company's enterprise agreement. He said he had "played by the rules". Mr Bates said he had never received any formal or informal warnings about his absenteeism and queried why the person who was ranked number one was still employed.

14 Mr Bates reiterated that he had not been trained or offered training and never given a 'fair go' to get over his permanent medical restrictions. He didn't know why the respondent had said he had limited potential for other duties and said he was never warned that he had a lack of skills in the office environment.

15 Mr Bates denied that there had been 'in depth' discussions about his redundancy. He was simply handed a letter of termination on the day and told to go home early. This was the first he knew of his redundancy.

16 In cross-examination, Mr Bates agreed that a Dr Ellis had said on 5 September 2005 that he (Mr Bates) was "permanently unfit for physically demanding work".

17 Mr Bates said he is currently receiving 80 per cent of his wage through the insurance company and was one of the first to receive the s 40 gap payment. Despite this he would rather work for the money. Mr Bates believed that he was made redundant because he had had two operations and otherwise the respondent would have had to pay him trades wages. Mr Bates believed that the respondent had put another injured worker in his place because that person was younger.

18 Two other employees were summoned to give evidence. Mr Gregory Splatt, a shift supervisor, described Mr Bates as a pretty good worker. He deposed that the ordering and checking job had been done by a number of employees over the years.

19 Mr Mark New is a glass cutter leading hand. He had worked at the company for 18-19 years and described Mr Bates "as a good worker". He said that four employees, including supervisors, now do the order checking and he had also been trained to do the checking.

20 Mr Brett Morvan has worked at the company for nine years. He described his current position as CNC programmer. While he had been doing the order checking after the five employees were made redundant, his other duties included logging on the furnace, the meterage and measuring templates. He said the order checking is now done by two supervisors, after he ceased performing that work at Christmas. He deposed that order checking had always been done by different people.

21 Mr Terry Kesby, has been a Union Official in the glass industry since 1984. He gave evidence about his long and extensive dealings with the respondent. Mr Kesby said that under the terms of the Glass Workers (State) Award Mr Bates was not redundant because his job was now being done by another employee, Mr Morvan.

22 Mr Kesby did not dispute that the industry had undergone a downturn in 2006. He had been available to discuss redundancy and selection procedures. He said that none of the notification and consultation requirements in the Award had occurred during the August 2006 redundancies. His understanding was that employees were simply given an envelope detailing their entitlements and were then told to leave the premises.

23 Mr Kesby believed that Mr Bates had been selected for redundancy because he had been the first to successfully claim s 40 top-up payments meaning he was paid $250 a week in make up pay. This cost is eventually borne by the respondent directly in the form of future higher premiums. In cross-examination, Mr Kesby was asked if he knew that premiums were unaffected after three years of a claim being made. He said he believed premiums were affected, either directly or indirectly.

24 Mr Gregory John Hayes is the respondent's New South Wales General Manager. He deposed that the respondent currently has 59 employees, down from 66 12 months ago. Mr Hayes agreed that overtime had increased dramatically in the last six months.

25 Mr Hayes said that in 2006 there had been a general downturn in the industry and the Smithfield plant had suffered a reduction in orders and workload. There was discussion about alternatives and what could be done to ensure the respondent remained profitable. Consideration was then given, section by section, to assessing employees on attendance, training, capabilities and skills. Account was also taken of how work might be shared around.

26 Mr Hayes described the role of order checker and said that the position was not a dedicated job for one person. It had always been shared and the order checking can be done by a different person on a different day. In cross-examination, Mr Hayes agreed that all orders have to be checked, but it is not a full time job.

27 Mr Hayes said that five employees were made redundant on 28 August 2006 and three others were transferred to other locations. He agreed that discussions with the individuals only occurred that day. However, it would have been obvious at the time, that there was very little work going through the factory and no overtime was being worked.

28 Mr Hayes referred to Mr Bates' return to work from injury in 2004. As there were restrictions on him, work was found in the office. In late 2005, the respondent gave him notice of permanent office work in clerical duties which became effective in January 2006. The work involved checking and chasing up orders and assisting in the production planning department.

29 Mr Hayes denied that Mr Bates' injury was a factor in his redundancy. He said that his injury wasn't a consideration at all. Staff had to be reduced and Mr Bates had less skills and less experience than others in the office. Mr Bates was considered for other work. However, glass cutting wasn't an option because of his medical restrictions. While he had been the only glass cutter tradesperson made redundant, other non trades glass cutters had been.

30 Mr Hayes agreed that Mr Bates' absenteeism record was one of the considerations taken into account when selecting him for redundancy. He agreed however, that Mr Bates had taken sick leave in accordance with the provisions of the enterprise agreement, including by providing doctors' certificates. Further, Mr Hayes was not aware of him having been counselled for his absenteeism. Mr Hayes explained that the respondent's ranking was of actual absenteeism, not whether employees had complied with the terms of the agreement. In any event, it was only one of the considerations taken into account. Mr Hayes said that while some other employees had an absentee ranking higher than others and were not made redundant, it was but one of a number of factors taken into account. Each department had been assessed to ensure it was able to operate effectively. An employee's skills were assessed, as was whether particular machinery could be used and whether employees had a capacity to learn in the future.

31 Mr Hayes agreed that despite asking for training, Mr Bates was not offered formal retraining. However, his ability and skills were known to management. Mr Hayes said that there hadn't been the time to train him. Mr Hayes agreed that Mr Morvan had been brought in primarily to do the order checking at that time. Mr Hayes also agreed that Mr Bates was performing his job well in the office.

32 Mr Hayes said that the work Mr Bates had performed in the factory was outside his restrictions, which was why he was not offered rehabilitation in his trade. However, a return to work plan had identified other duties, such as auto cutting, templates and marking out.

33 Mr Hayes denied that Mr Bates' s 40 workers' compensation payments were a reason for his dismissal and said that the respondent had, in fact, encouraged him to go forward with the claim.

34 Mr Hayes agreed that it was not necessarily the case that had Mr Bates not been injured (and had continued to work in the factory as a glass cutter) he wouldn't have been made redundant. This was hypothetical. Some glass cutters had, in fact, been transferred and other non-trades glass cutters were made redundant.

35 Mr Hayes claimed that Mr Bates was given duties consistent with advice received from the Rehabilitation Coordinator and the doctors. It had been a mistake to let him do factory work around Christmas 2005. Mr Hayes denied that Mr Bates' only real opportunity to perform some trade work was if he was reinstated. Mr Hayes believed the respondent had fulfilled all its moral obligations to Mr Bates.

36 In re-examination, Mr Hayes emphasised that there was no single major factor in deciding who was to be made redundant. The respondent had looked at workload and determined that staff needed to be reduced by six or seven. Various factors, including potential for performing further work in the office was taken into account in Mr Bates' case.

37 Mr Hayes confirmed that the respondent's premium calculations for workers' compensation insurance were unaffected by Mr Bates' s 40 payments because his injury had occurred more than three years earlier.

38 Mr Hayes said that although no glass cutter tradesperson had been made redundant, those who were working in the factory as glass cutters were paid as if they were tradespersons.

SUBMISSIONS

39 Both parties filed detailed written submissions which I summarise as follows.

For the Union

40 Mr Marshall criticised the reasons cited by the respondent as to why Mr Bates had been selected for redundancy. He said that it was wrong to describe Mr Bates' absences as demonstrating a poor attendance record as he had taken leave strictly in conformity with the terms of the enterprise agreement. Moreover, Mr Bates had never received any warnings or counselling about his attendance record. In addition, Mr Marshall said that the absenteeism rankings were applied inconsistently and this demonstrated that the whole process was unfair.

41 Mr Marshall asserted that Mr Bates would not have been injured, but for defective equipment and that his injury resulted in his move to the position of order checker. He received no training in office duties, yet he was considered not to be computer literate and having limited potential. Notwithstanding his restrictions, Mr Bates had worked for several days in the factory and without incident. He had been promised training in computer glass cutting, but never received it. Mr Bates had been denied proper rehabilitation in breach of the respondent's own policies. In any event, his work as an order checker was never questioned.

42 Mr Marshall said that there was no doubt that Mr Bates was fit to be reinstated to the order checker's position or on light glass cutting work.

43 Mr Marshall submitted that the uncontradicted evidence of Mr Morvan (corroborated by Supervisor Gregory Splatt) disclosed that Mr Morvan had been placed into Mr Bates' redundant position. He said it was also a factor that Mr Bates had been successful in his s 40 workers' compensation top-up pay claim.

44 Mr Marshall relied on Cansino v South Western Sydney Area Health Service (1999) 130 IR 1 and Riley v WorkCover Authority of New South Wales (2006) 151 IR 396 to support the proposition that the respondent had a position which was reasonably available to which Mr Bates should be reinstated. In addition, the two supervisor witnesses described Mr Bates as a good and capable worker. Mr Marshall identified three available positions to which Mr Bates could be reinstated:

· his former order checker position and that Mr Bates receive CNC program training and be offered the first available restricted glass cutter position;

· the position of light duties glass cutter with rehabilitation training;

· combining the office and factory duties into a more highly skilled order checker's position.

Orders for lost remuneration were also sought.

45 Mr Marshall examined the evidence of Mr Hayes and made the following observations. Mr Hayes

· had confirmed Mr Morvan's main role was order checking and it was a dedicated job primarily done by him - at least from August to December 2006;

· had said that the office staff were considered discretely as a group for redundancy, yet it was Mr Bates' forced transfer to the office which placed him in a position of having less skills than the others;

· had accepted Mr Bates' absenteeism record was in accordance with the agreement and he could offer no explanation why the ranking methodology was so flawed;

· had claimed that Mr Bates' restrictions meant that he had not been moved into light glass cutting, yet Mr Morvan was retained in the position with even greater restrictions;

· had conceded that the respondent had offered no training to Mr Bates and had demonstrated a casual, callous indifference to him over two years when he had said they hadn't found time to train him;

· had conceded that the order checker's position was not redundant. He further conceded that Mr Bates would be unlikely to secure another position with his current restrictions.

46 Mr Marshall submitted that the respondent had failed to discharge its onus under s 95(2) of the Act. There was no doubt when applying the test in Riley that the respondent had reasonably available useful work for Mr Bates to perform which would be beneficial for both parties.

For the respondent

47 Mr Ban questioned the jurisdiction of the Commission to deal with this matter, but accepted the conclusions in this regard as referred to in Australasian Meat Industry Employees' Union, Newcastle and Northern Branch (on behalf of B Fisher) and Inghams Enterprises Pty Ltd [2006] NSWIRComm 202.

48 In referring to Riley, Mr Ban said that the Full Bench there determined the question on not whether the employment applied for was vacant, but rather whether it was available. In Riley, the termination letter stated that "as a consequence of a medical report that had been received, the GM WorkCover had decided to terminate his services". This fact is to be distinguished from the present case where Mr Bates was one of five persons made redundant because of a down turn in the industry. The workforce had been reduced by 10% over 12 months. Further, Mr Bates had undergone a long period of rehabilitation from March 2003 until he commenced full time clerical duties in January 2006.

49 Mr Ban submitted that there was no single factor which had resulted in Mr Bates' redundancy. A range of issues was considered. Mr Hayes had expressly said that Mr Bates' injury was not a consideration at all. Mr Ban said that this was further demonstrated by the fact that Mr Bates' order checker role was undertaken by another employee with even tighter medical restrictions.

50 Mr Ban emphasised that Mr Bates' absenteeism was only one of the criterion considered and was not a major factor in the selection process.

51 Mr Ban said it was wrong to suggest that no glass tradespersons were made redundant. The relevant enterprise agreement recognises experienced non trades glass workers and some were made redundant. Mr Ban said that the respondent had not disputed, and never had disputed, Mr Bates' medical certificates.

52 Mr Ban said that the undisputed evidence of Mr Morvan and Mr Splatt was that the position of order checker was non specific and had been performed by a number of employees over the years. The position no longer exists and the work is spread over a number of employees including Mr Morvan, who also carries out computer and recording work.

53 Mr Ban put that the s 40 top-up claim was not a factor in Mr Bates' dismissal and, in fact, the respondent had encouraged and cooperated in an amicable and swift settlement of the claim. Mr Ban said it was wrong to suggest Mr Bates received no training. He did receive on the job training during his rehabilitation.

54 Mr Ban submitted that Mr Bates was reclassified under the Clerical and Administrative Employees (State) Award by mutual agreement and after a lengthy consultation process. It was only logical that he was compared to the other office workers in the selection process.

55 In reply, Mr Marshall contested the respondent's present financial performance by reference to an historic graph of orders. He claimed this demonstrated a "swings and roundabouts" situation. In addition, there had been a marked improvement in the general industry position which strengthened the reasonable availability of work argument and defeated the respondent's assertion that further redundancies might be necessary.

56 Mr Marshall strongly disputed the respondent's claim of a long period of rehabilitation provided to Mr Bates. In Cansino emphasis was placed on the rehabilitation undertaken. However, in this case there had been none. Mr Marshall put that on the job training meant nothing. Moreover, Mr Hayes had blithely stated that "there just was never the time to retrain him".

CONSIDERATION

57 There are three preliminary matters which require determination at the outset of this decision. The first concerns the implied suggestion by the respondent that the Commission may not have jurisdiction to decide this application following the changes made to the Federal Workplace Relations Act last year ('WorkChoices legislation'). As this submission was not developed in any detail and was pursued with little enthusiasm, I believe it can be dealt with in short compass. Given the recent Full Bench decisions which have authoritatively dealt with the exclusion of matters under the Workchoices legislation, I do not consider there to be any doubt that a matter pertaining to the reinstatement of an injured worker can be competently brought before the Industrial Relations Commission of New South Wales and that there is no jurisdictional hurdle preventing the Commission from determining this application: see Transport Industry- Mutual Responsibility for Road Safety (State) Award and Contract Determination (No. 2), Re (2006)158 IR 17 and Endeavour Coal and others v CFMEU [2007] NSWIRComm 70.

58 The findings of His Honour Harrison DP in Australasian Meat Industry Employees Union, Newcastle and Northern Branch (on behalf of B Fisher) and Inghams Enterprises Pty Ltd went directly to this jurisdictional point:

54 The determinations in Unions NSW v Carter Holt Harvey Wood Products (2006) 149 IR 363 and Fabros support the conclusion that no s 109 conflict arises in the present matter due to the distinctly different subject matter addressed in the NSW and Federal legislation.

DETERMINATION

(1) Part 7, Protection of Injured Workers, of Ch 2 of the NSW Act applies to employees of constitutional and trading corporations and is not excluded by the Federal Act.

(2) Part 7 of Ch 2 of the NSW Act is properly characterised as a law dealing with the subject matter of workers compensation and is specifically preserved by s 16(3)(b) of the Federal Act.

(3) The character and terms of Pt 7 of Ch 2 of the NSW Act are not found in the Federal Act and accordingly no constitutional conflict arises.

(4) The Union is entitled to bring the present application on behalf of Mr Fisher.

59 I respectfully concur with his Honour's conclusions which relied on the decision in Unions NSW v Carter Holt Harvey Wood Products Australia Pty Ltd (2006) 149 IR 361 and two earlier decisions which expressly dealt with applications made by Federally covered employees under the injured worker provisions of the State Act: see Fabros v Hotel Intercontinental Sydney (1993) 53 IR 193 and Construction, Forestry, Mining and Energy Union (New South Wales Branch) on behalf of Scott Anthony Elwell and Cobar Mining Services Pty Ltd and Anor [2004] NSWIRComm 32.

60 The second matter concerns the recent transfer of the injured workers provisions in the Act to the Workers' Compensation Act 1987 on 2 February 2007; see Industrial Relations (Further Amendment) Act 2006 No 97.

61 The transfer of the injured workers' provisions was made without any alteration to the terms of Pt 7 Ch 2 of the Act, including reposing within the Industrial Relations Commission the power to make reinstatement orders in respect to an injured worker.

62 In any event, the application here to be determined was filed on 10 October 2006, some four months before the transfer of the provisions of Pt 7 Ch 2. There can be no doubt that Mr Bates' application is preserved and that his litigation can proceed under the provisions of the Act as they existed prior to 2 February 2007, noting that there is no change arising from the transfer of the provisions; see s 30 of the Interpretation Act 1987. Accordingly, I shall refer to the former provisions of the Act when citing the relevant legislative provisions.

63 Thirdly, while the point was not directly taken, it is necessary to state that for the purposes of the term 'dismissal' in the former Pt 7 Ch 2 of the Act, the redundancy of an employee has the same meaning as the dismissal of the employee.

The Statutory Framework

64 It is necessary to set out the relevant provisions of the former Pt 7 Ch 2 of the Act:

92 Application to employer for reinstatement of dismissed injured employee

(1) If an injured employee is dismissed because he or she is not fit for employment as a result of the injury received, the employee may apply to the employer for reinstatement to employment of a kind specified in the application.

(2) The kind of employment for which the employee applies for reinstatement cannot be more advantageous to the employee than that in which the employee was engaged when he or she first became unfit for employment because of the injury.

(3) The employee must produce to the employer a certificate given by a medical practitioner to the effect that the employee is fit for employment of the kind for which the employee applies for reinstatement.

93 Application to Commission for reinstatement order if employer does not reinstate

(1) If an employer does not reinstate the employee immediately to employment of the kind for which the employee has so applied for reinstatement (or to any other kind of employment that is no less advantageous to the employee), the employee may apply to the Commission for a reinstatement order.

(2) An industrial organisation of employees may make the application on behalf of the employee. Page 47 Section 93 Industrial Relations Act 1996 NO 17 Chapter 2 Employment Part 7 Protection of injured employees

(3) The Commission may not make a reinstatement order, except in special circumstances, if the application to the employer for reinstatement was made more than 2 years after the injured employee was dismissed.

94 Order by Commission for reinstatement

(1) The Commission may, on such an application, order the employer to reinstate the employee in accordance with the terms of the order.

(2) The Commission may order the employee to be reinstated to employment of the kind for which the employee has so applied for reinstatement (or to any other kind of employment that is no less advantageous to the employee), but only if the Commission is satisfied that the employee is fit for that kind of employment.

(3) If the employer does not have employment of that kind available, the Commission may order the employee to be reinstated to employment of any other kind for which the employee is fit, being:

(a) employment of a kind that is available but that is less advantageous to the employee, or

(b) employment of a kind that the Commission considers that the employer can reasonably make available for the employee (including part-time employment or employment in which the employee may undergo rehabilitation).

(4) If the Commission orders the employee to be reinstated, it may order the employer to pay to the employee an amount stated in the order that does not exceed the remuneration the employee would, but for being dismissed, have received after making the application to the employer for reinstatement and before being reinstated in accordance with the order of the Commission.

95 Presumption as to reason for dismissal

(1) In proceedings for a reinstatement order under this Part it is to be presumed that the injured employee was dismissed because he or she was not fit for employment as a result of the injury received. Page 48

(2) That presumption is rebutted if the employer satisfies the Commission that the injury was not a substantial and operative cause of the dismissal of the employee.

96 Disputes as to fitness-medical referees and panels

(1) The Commission may refer to a medical referee or medical panel any dispute as to the employee’s condition and fitness for employment.

(2) The medical referee or medical panel is to submit a report to the Commission in accordance with the terms of the reference.

(3) In this section, medical referee and medical panel have the same meanings as in the Workers Compensation Act 1987.

97 Continuity of service of reinstated employee

(1) If an employee is reinstated under this Part, the Commission may order that the period of employment of the employee with the employer is taken not to have been broken by the dismissal.

(2) However if the Commission does so, the period between dismissal and the date of the application by the employee to the employer for reinstatement is not to be taken into account in calculating for any purpose the period of service of the employee with the employer.

Of particular relevance in this case is the rebuttal presumption provision found at s 95(2).

65 In my opinion, the decisions in Casino and Riley do not address the fundamental issue to be determined here, that is, was Mr Bates' injury the substantial and operative cause of his dismissal. If the answer to this question is yes, then the reasoning in those decisions is relevant to whether the applicant should be reinstated to a position which the respondent might reasonably have available. However, if the answer is in the negative, it takes the matter no further and the issue of a reasonably available position is moot.

66 That being said, the determination of this matter hinges on the meaning of the expression "substantial and operative cause" (of the dismissal of the employee). The respondent vigorously maintained that Mr Bates' injury was not the substantial and operative cause of his dismissal. Indeed, it was Mr Hayes' evidence that the injury was not a factor at all in the decision to make Mr Bates redundant. If that evidence is accepted then the respondent will have successfully rebutted the presumption provided for in s 95 of the Act and, as I said earlier, that would seemingly be sufficient to end the matter.

67 It will be immediately apparent that there is no authoritative judgment of the Commission which has considered the meaning of the expression "substantial and operative cause" in the context of the injured worker provisions of the Act (now the Workers' Compensation Act). Certainly Cansino and Riley do not address this point. In Construction, Forestry, Mining and Energy Union (New South Wales Branch) on behalf of Scott Anthony Elwell and Cobar Mining Services Pty Ltd and Anor [2004] NSWIRComm 32, I made the following short observation as to the meaning of the expression:

100 I also accept Mr Bukarica's submission that the expression "substantial and operative cause" should not be read down to mean the sole or only cause. Even if there were other reasons for the applicant's dismissal, I am well disposed to find that the applicant's injury was a primary motivation for the respondent's decision to dismiss him.

68 In view of the reliance placed by the respondent on s 95(2) it is necessary, I believe, to give more fullsome consideration of the meaning of the expression in order to test whether the respondent's defence has been made out.

69 The Concise Oxford Dictionary defines 'substantial' as "of real importance or value, of considerable amount" and 'operative' as "having principle relevance". The Macquarie Dictionary defines the word 'substantial as "of ample or considerable amount, quantity, size etc; of real worth or value" and 'operative' as "most significant or relevant".

70 The first observation to be made from these definitions is that there is a similarity in both the words' meanings which, to my mind, is intended to give emphasis to the proposition that the injury must be the primary or principle cause of the employee's dismissal. As I said in Elwell, the expression should not be read down to mean the sole or only reason. However, conversely, it cannot mean that the presumption fails if the injury was but one of a number of reasons for the dismissal. It must be something much more than simply being one of the reasons or causes of the dismissal. Put another way, if the injury is a factor in the dismissal, it must be the factor which attracts the most weight.

71 Even if it is accepted that Mr Bates' injury resulted in him being relocated to the office and consequently his lack of office skills was a factor in his selection for redundancy, does the injury result in a conclusion that it was the most significant reason for his redundancy? There can be no doubt that Mr Bates was capable of performing his office duties. Indeed, there had been no complaint about his competence or abilities in this regard. But this is not the point. What is relevant, and how the case was developed, was whether Mr Bates' redundancy was genuine and therefore the significant or primary cause for his dismissal, rather than his injury.

72 It is not an answer as Mr Marshall contended, that had Mr Bates not been injured he would have remained a glass cutter tradesperson and not been made redundant. It followed, it was said, that therefore his injury was the substantial and operative cause of his dismissal because he wouldn't have been dismissed without it. This submission, apart from being purely hypothetical, ignores the reality of the situation faced by the respondent.

73 The undisputed evidence disclosed that the respondent was undergoing significant financial difficulties in 2005-2006. From profits of 1 million and 1.4 million in 2003 and 2004 respectively it suffered losses of $156,000 and $697,000 in 2005 and 2006. In August 2004 it had 84 employees and after the redundancies in August 2006, the staff numbers were 61. Mr Kesby, an experienced union official, did not dispute the state of the industry downturn in 2006 and his general discussions with the respondent about the situation. He attended the site on a number of occasions, but was not directly involved in the selection process surrounding the redundancies in August 2006.

74 The issue here is not whether Mr Bates was fairly selected in that process but whether his injury was the substantial and operative cause of his dismissal. That being said, I will have something less than complimentary to say about the process shortly.

75 The evidence leaves no room to doubt that the respondent was undergoing financial difficulties in 2006 and its response to these difficulties included the redundancy of a number of employees. I am satisfied that the redundancies in August 2006 were brought about by the genuine need to address the respondent's financial situation. This finding, however, does not address the issue here to be determined. The thrust of Mr Marshall's submissions was whether Mr Bates' redundancy was unfair and a 'sham' to disguise the real reason for his dismissal - his injury. Notwithstanding some obvious flaws in the process, I am satisfied that the primary cause of Mr Bates' dismissal was the respondent's need to make a number of redundancies. Support for this view comes from the following:

1. Five other employees were made redundant at the same time following a process of assessment of the respondent's operational requirements on a section by section basis. Three of the five redundant employees were experienced non-trades glass cutters who were paid as tradespersons. Unfortunately, it is a fact of industrial life that an employer faced with making redundancies will usually seek to retain those employees with the most skills and with the most perceived value to the company's future operations. While the selection process should be as fair, unbiased and transparent, it cannot be made in a vacuum.

2. Mr Bates accepted full time clerical work in January 2006 with the prognosis of his injury suggesting that there was little likelihood of him returning to full glass cutting duties. In my opinion, it was not unreasonable for the respondent to assess Mr Bates' potential for redundancy in the context of his office role, including his experience and length of service within the office.

3. Mr Marshall strongly criticised the respondent's failure to retrain Mr Bates in advanced office work. While there is some basis for this submission, it will no doubt be the case, in any redundancy situation, that criticism can be levelled at an employer for not doing more to retrain or provide opportunities for retraining for potentially redundant employees. Here, the respondent was faced with the reality of the situation as it then existed.

4. The evidence makes clear that the position of order checker was not a dedicated position and that the duties of order checker were shared between employees. The fact the Mr Morvan took over these duties does not necessarily compel a finding that the job had not disappeared. Rather Mr Morvan had it added to his other duties and it later was absorbed by other employees.

5. Had the respondent truly intended to select employees for redundancy who were on light duties, why was Mr Morvan retained, despite having greater lifting restrictions than Mr Bates? Mr Morvan's retention does not assist the Union's claim but, in my view, rather demonstrates that the respondent had not considered a worker's injury as a primary factor in the selection process.

6. Mr Marshall successfully established that Mr Bates' absenteeism record was not inconsistent with the terms of the enterprise agreement and that it appeared that other employees with poor records were retained when compared to others whose record was better, but who were made redundant. Whatever might be said about the use of absenteeism as a selection criterion and the flaws in the methodology used, the fact was that Mr Bates ranked second worst out of 66 employees. In my opinion, however, the fact that the absenteeism rankings resulted in different outcomes demonstrates that it was but one of the factors used in the selection process. Would not the criticism have been greater if the absenteeism ranking was the only criterion relied upon? On the other hand, there is substance to Mr Marshall's criticism that Mr Bates received no warnings or counselling about his absenteeism record. Had this been an unfair dismissal case, these failures would have surely been matters taken into account in deciding whether the dismissal was harsh, unreasonable or unjust.

7. I am unable to accept the Union's claim that one of the reasons for Mr Bates' redundancy was his s 40 workers' compensation top-up payments. Mr Hayes correctly identified that this claim had no impact on the respondent's premiums. Moreover, I accept the evidence that the respondent had not sought to frustrate the claim or prevent an amicable settlement of it.

8. The fact that Mr Bates received the maximum in redundancy payments demonstrates that the cost of making redundancies was not a major factor in the selection process. Surely, if the focus was on reducing costs by saving money in the process, the respondent would have selected employees with the least service.

Mr Bates' Dismissal

76 Mr Bates received no notice of his redundancy and obviously the respondent did not consult with him or his Union about his potential redundancy or what other options might be available. Mr Bates was given no opportunity to defend his position or challenge the validity of the selection process, per se, or how it was applied to him: see Shop, Distributive and Allied Employees Association, New South Wales v WD & HO Wills [2000] NSWIRComm 98.

77 It follows that I have no hesitation in concluding that had this been an unfair dismissal case, pursuant to s 84 of the Act, Mr Bates' redundancy would have been found to be unfair. I do not accept that the respondent had honoured its moral obligations to Mr Bates. To give an employee a letter of redundancy on the day of termination without notice or warning is unacceptable conduct both morally and industrially.

78 Moreover, I am satisfied that the respondent was in breach of Cl 2 and 3 of the relevant Award. The Award provides for the following provisions reflecting the redundancy test case standards of this Commission:

(2) Introduction of Change

(a) Employer's duty to notify

(1) Where an employer has made a definite decision to introduce major 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 they belong.

(2) "Significant, effects" include termination of employment, major changes in the composition, operation or size of the employer's workforce or in the skills required, the elimination or diminution of job opportunities, promotion opportunities or job tenure, the alteration of hours of work, the need for retraining or transfer of employees to other work or locations and the restructuring of jobs.

Provided that where the award makes provision for the alteration of any of the matters referred to herein an alteration shall be deemed not to have significant effect.

(b) Employer's duty to discuss change

(1) 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 paragraph (a) of this subclause, 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 the employees and/or the union in relation to the changes.

(2) 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 paragraph (a) of this subclause.

(3) For the purpose of such discussion, the employer shall provide to the employees concerned and the union to which they belong all relevant information about the changes including the nature of the changes proposed, the expected effects of the changes on employees and any other matters likely to affect employees provided that any employer shall not be required to disclose confidential information the disclosure of which would adversely affect the employer.

(3) Redundancy

(a) Discussions before terminations

(1) Where an employer has made a definite decision that the employer no longer wishes the job the employee has been doing done by anyone pursuant to subclause (2)(a)(1) of this clause and that decision may lead to the termination of employment, the employer shall hold discussions with the employees directly affected and with the union to which they belong.

(2) The discussions shall take place as soon as is practicable after the employer has made a definite decision which will invoke the provision of subclause (3)(a)(1) of this clause and shall cover, inter alia, any reasons for the proposed terminations, measures to avoid or minimise the terminations and measures to mitigate any adverse effects of any termination of the employees concerned.

(3) For the purposes of the discussion the employer shall, as soon as practicable, provide to the employees concerned and the union to which they belong, all relevant information about the proposed terminations including the reasons for the proposed terminations, the number and categories of employees likely to be affected, and the number of employees normally employed and the period over which the terminations are likely to be carried out. Provided that any employer shall not be required to disclose confidential information the disclosure of which would adversely affect the employer.


79 I would wish to stress that should there be the need for any future redundancies, the respondent is required to comply with the terms of its Award obligations and reasonable contemporary industrial standards.

80 For the aforementioned reasons, I find that the respondent, G. James Safety Glass has rebutted the presumption in s 95(2) of the Act in that Mr Bates' injury was not the substantial and operative cause of his dismissal.

81 The application for reinstatement is thereby dismissed.

Peter J Sams, AM
Deputy President



LAST UPDATED: 31 May 2007