Federal Court of Australia Jermiin v Commonwealth Scientific and Industrial Research Organisation [2021] FCA 1043 Appeal from: Jermiin v Commonwealth Scientific and Industrial Research Organisation [2021] FCCA 549 File number(s): ACD 24 of 2021 Judgment of: RARES J Date of judgment: 19 August 2021 Catchwords: INDUSTRIAL LAW – where employer had 'headhunted' highly skilled senior employee – where employer later implemented new business strategy requiring organisational restructure – where restructure made employee's job redundant – where enterprise agreement required employee's line manager to determine if no ongoing need for employee's skills and if so to advise employee that he or she potentially redundant – whether employer could require employee to have additional skills not previously required – held: both employment contract and enterprise agreement permitted employer to engage in a structural reorganisation that could cause employee's job to become redundant – employer had correctly applied process for termination identified in enterprise agreement – appeal dismissed. Legislation: Fair Work Act 2009 (Cth) Cases cited: Concut Pty Ltd v Worrell (2000) 176 ALR 693 Hodgson v Amcor Limited (2012) 264 FLR 1 Kucks v CSR Ltd (1996) 66 IR 182 Lee v Lee (2019) 266 CLR 128 R v Industrial Commission of South Australia; Ex parte Adelaide Milk Supply Cooperative (1977) 16 SASR 6 UGL Rail Services Pty ltd v Janik (2014) 246 IR 320 Division: Fair Work Division Registry: Australian Capital Territory National Practice Area: Employment and Industrial Relations Number of paragraphs: 47 Date of hearing: 19 August 2021 Counsel for the Appellant: Dr A Greinke Counsel for the Respondent: Mr J Darams Solicitor for the Respondent: Ashurst ORDERS ACD 24 of 2021 BETWEEN: LARS SOMMER JERMIIN Appellant AND: COMMONWEALTH SCIENTIFIC AND INDUSTRIAL RESEARCH ORGANISIATION Respondent order made by: RARES J DATE OF ORDER: 19 AUGUST 2021 THE COURT ORDERS THAT: 1. The appeal be dismissed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT (REVISED FROM THE TRANSCRIPT) RARES J: 1 This is an appeal by Dr Lars Jermiin, a distinguished academic and scientist who was formerly employed by the Commonwealth Scientific and Industrial Research Organisation (CSIRO), the respondent. Dr Jermiin was appointed, under a contract of employment made on 31 December 2008, to a full-time position in the office of the chief executive as a science leader in CSIRO Entomology located at Black Mountain in the Australian Capital Territory. The appointment was for an indefinite term at level CSOF 7, but the contract gave him an initial five year term appointment at level CSOF 8.2 that attracted a higher salary. The contract provided, in cl 7(b)(iv), that the appointment could be terminated, relevantly, by CSIRO in the event of "redundancy (i.e. your becoming an excess to CSIRO's staffing requirements)". Dr Jermiin's appointment was also subject to and governed by, relevantly, present or future legislation, awards and certified agreements that were binding on CSIRO. After the passage of the Fair Work Act 2009 (Cth), CSIRO became bound by the CSIRO Enterprise Agreement 2011–2014. 2 On 30 January 2017, CSIRO terminated Dr Jermiin's employment. Dr Jermiin brought proceedings in the Federal Circuit Court claiming that his termination was invalid because there continued at all times to be an ongoing organisational requirement for his skills within the meaning of cl 5(c) of Sch 3 to the enterprise agreement. The trial judge dismissed Dr Jermiin's claim and he has appealed to this Court against that decision. 3 The critical issue in this appeal is whether the trial judge applied the correct test in determining whether the line manager for Dr Jermiin's position, Dr Gregory Davis, correctly determined that there was no ongoing organisational requirement for Dr Jermiin's skills, within the meaning of cl 5(c) of Sch 3 to the enterprise agreement. The enterprise agreement 4 Clause 57 of the enterprise agreement was a consultation term that complied with s 205 of the Fair Work Act. Clause 57 applied where CSIRO had made a definite decision to introduce a major change to its organisational structure that was likely to have a significant effect on officers of the enterprise, namely, termination of their employment. 5 Relevantly, the enterprise agreement provided in Sch 3 for situations of redeployment and retrenchment. Clauses 2 and 5 were as follow: 2. Potentially Redundant Officers (a) An officer is potentially redundant if: (i) the officer is included in a group of officers, which group comprises a greater number of officers than is necessary for the efficient and economic working of CSIRO; (ii) the services of the officer cannot be effectively used because of technological, structural or other changes in the work methods of CSIRO or changes in the nature, extent or organisation of the functions of CSIRO … 5. Identification of individual officers from an impacted group of officers (a) After voluntary redundancy substitution has been considered, in any situation where the number of roles available is fewer than the current number of officers occupying those roles, the following process will be adopted. (b) The responsible Line Manager will use available knowledge and information to undertake an assessment of each officer against the organisational requirements for the role/s developed in line with the applicable work classification standards. The principles of procedural fairness will be applied. The officer will have the opportunity to provide information if they so choose, however they will not be required to make a formal application for their existing role. (c) The final decision will be made by the responsible Line Manager and affected officers will be advised. Where it is determined that there is no ongoing organisational requirement for the officer's skills, the officer will be advised that they are potentially redundant and will be provided with information in accordance with sub-paragraph 6(a). (emphasis added) 6 The enterprise agreement also provided that: where, due to an organisational change or restructuring, 10 or more officers were likely to become potentially redundant, CSIRO had to inform, among others, the relevant unions of the details of the circumstances causing that situation, the impact on science and research capabilities and or support for those areas, the number of officers potentially affected and the method of identifying who would be affected (cl 3(a)); consultation in accordance with cl 57 would then follow (cl 3(b)); an officer who was potentially redundant could exchange positions with another who would not contest his or her redundancy (cl 4); each individual officer likely to become redundant should be advised of the situation and informed, among others, of the details of the circumstances which give rise to the potential redundancy (cl 6); CSIRO had to carry out an organisation-wide survey of existing and foreseeable vacancies, which were at the same or one level below the officer's substantive level in the same functional area, to consider the potential for redeployment (cl 7); retrenchment would occur if no redeployment were possible (cl 8). 7 Schedule 6 to the enterprise agreement described the duties of employees at the different CSOF levels of the CSIRO's salary structure, including, relevantly, for level 8: Level 8 Under broad guidance about objectives, assists in the overall strategic management of a Business Unit or manages a major scientific, engineering or administrative program. This requires a high degree of resource management and leadership ability. Has extensive expert knowledge of his/her field, and outstanding ability in planning and executing programs and implementing results. Typically provides expert scientific, engineering or administrative leadership to colleagues, with significant conceptual and creative input. Plans at the program level, comprising a range of related projects, to meet objectives. Seeks, allocates and monitors substantial resources. Has a major role in negotiating more complex, sensitive or contentious issues. OR Under broad guidance about research program objectives, undertakes outstanding scientific or engineering research requiring a high degree of originality, creativity and innovation. The scientist's or engineer's achievements represent a substantial advancement in scientific knowledge or for industry or for the community. Has extensive scientific or engineering knowledge, and outstanding ability in research planning, execution and/or implementing research results. Typically has an international reputation in a significant field of science or engineering or industrial application and provides expert scientific or engineering leadership to research colleagues. May plan at the program level, typically for multiple projects, to meet objectives and seek, allocate and monitor resources. May have a major role in negotiating complex, sensitive or contentious issues. OR Functions as a senior specialist. Note: Special promotion criteria apply to advancement within this level. Background 8 I have drawn on the trial judge's unchallenged findings in the following summary of the facts. His Honour found that, originally, CSIRO had headhunted Dr Jermiin to work within the fields of his expertise. He described his own position as an evolutionary biologist and bioinformatician. At his five-yearly review in March 2014, Dr Jermiin's superiors supported his retention at level 8.2, saying that he had made meaningful contribution to research activities across the program as a science leader and, more broadly, across the whole Land and Water division. His superiors said that Dr Jermiin's contributions to phylogenetic methods would impact the future of phylogenetics research, as evidenced in his inclusion in an international project. They noted that he had published in the highest impact journals in his discipline, attracting high numbers of citations relative to his peers and continued to be in demand internationally. They described Dr Jermiin as an "internationally-recognised expert in molecular phylogenetics and evolution". 9 On 4 February 2016, the chief executive officer of CSIRO, Dr Larry Marshall, advised all its employees by email that CSIRO would be implementing the new business strategy that was published in July 2015 (the CSIRO 2020 strategy). Dr Marshall told them that "normally, a business has to cut to grow" and that this would inevitably lead to some job losses. 10 On 12 April 2016, Dr Paul Hardisty, the director of Land and Water, prepared a request for approval to proceed to implementation of business unit restructuring of Land and Water. The request envisaged that potentially 67 current staff were likely to become redundant. Those potential redundancies included officers in each of the seven programs within Land and Water who held a level 8 position, including Dr Jermiin, whose position was classed as phylogenomics. The request stated that phylogenomics "was an important component of our genomics work in general prior to the recent restructure" but that previously this capability had been co-located within two other units that provided a "broader path to impact opportunities for the research". The request stated that, as CSIRO: ... moves towards improved engagement strategies with partners in academia this would provide a more sustainable alternative source of phylogenetics capability as needed. 11 On 3 May 2016, Dr Jermiin attended a meeting with, among others, Dr Davis and a senior human resources adviser. The meeting concerned the potential that his position might be "impacted" by the CSIRO 2020 strategy. The trial judge found that at the meeting on 3 May 2016, Dr Davis had not raised with Dr Jermiin any concerns about lack of external funding in the past, but described the expression "external revenue sources" as primarily about an officer's ability to sell their work. 12 On 17 May 2016, Dr Jermiin met with Dr Davis, Dr John Oakeshott and a human resources executive Kathryn Rogers, who handed Dr Jermiin a letter stating (the 17 May 2016 letter) that CSIRO no longer required the job that he was doing to be performed due to "our changed operational requirements" and: As discussed with you the reasons for your potential redundancy are as follows: Phylogenetics is an important component of our genomics work in general, and prior to the recent restructure, this capablity was co-located with the ANIC and ANWC collections – which provided a broader path to impact opportunities for this research. Foreseeable business opportunities are not of a scale to support fundamental work in this area. As the organisation moves towards improved engagement strategies with partners in academia, this would provide a more sustainable alternative to source phylogenetics capability in the future as needed 13 The letter promised that, as Land and Water had no ongoing position for Dr Jermiin, CSIRO would seek redeployment opportunities for him elsewhere. On being handed the letter, Dr Jermiin said that the letter was simply wrong because phylogenetics was just one of his many capacities. Dr Oakeshott said that Dr Jermiin was correct and that none of those other capacities had been taken into account in the letter. Dr Davis responded by saying, "I will update the description of your capabilities in the letter." When Dr Jermiin asked him whether he or anyone senior to him in Land and Water, including Dr Hardisty, knew Dr Jermiin's capabilities and their value in the context of current and future research projects, Dr Davis responded, "I do not know them, and it's unlikely that anyone above me knows them." Dr Davis went on to say that the key issue was to reduce by eight the number of staff in program 2, being the one in which Dr Jermiin was the most senior officer, because CSIRO could not afford to keep the current number of staff on the books. 14 Subsequently, on 14 June 2016 Dr Davis sent Dr Jermiin another letter in substantively identical terms to the 17 May 2016 letter. However, this letter stated the reasons for his potential redundancy as follows: The reasons for your potential redundancy are as follows: The impact of CSIRO shifting investment away from Land and Water to other areas of CSIRO is having substantial effects on staffing including that in our Program. It is compelling Land and Water to increasingly support staff on external funds and business opportunities. In the review of capability across Land and Water and the Program it is clear that phylogenetics and molecular evolution capability have been important contributors to our genome bioinformatics capability, and prior to the recent restructure this capability was co-located with the ANIC and ANWC collections. This prior co-location seemed to provide a broader path to impact opportunities for this area of research. Though these capabilities will continue to be important for genome bioinformatics research, Land and Water's foreseeable business opportunities are not of a scale to support ongoing fundamental genome bioinformatics research based on phylogenetics and molecular evolution theory and tools. (emphasis added) 15 His Honour found that Dr Davis, in arriving at his ultimate decision, had taken into account the further information as to his skills that Dr Jermiin provided him subsequently to 17 May 2016. A number of attempts were made within CSIRO to find redeployment for Dr Jermiin. 16 Ultimately, on 16 August 2016, Dr Hardisty emailed Dr Jermiin, saying that he was grateful for the additional information Dr Jermiin had sent him and for the discussions they had had. He explained that he followed up matters with colleagues, but that, recognising it was a very difficult process, he was not in a position to change the course of Dr Jermiin's case. He said: External revenue generation is critical for the whole business unit. Budgetary pressures mean that we must reduce staff. Capability we retain must be tied to expectations of external revenue generation and, in your case, this emerged as a key factor. I'm sorry it's worked out this way. (emphasis added) 17 Intriguingly, the trial judge accepted Dr Davis' evidence that, in his view, Dr Jermiin was not covered by cl 5 of Sch 3 to the enterprise agreement because, he said, Dr Jermiin was in a unique position, as opposed to within a relevant group to which he understood cl 5 might have applied. His Honour also found that found that Dr Davis was not across the finer details of the distinctions in cl 5 as to how it applied to an individual officer as compared to an individual who was part of an impacted group. 18 Dr Davis said that, previously, officers of Dr Jermiin's calibre, who were in positions such as his, had been fully funded by CSIRO and their tenure was not dependent on external funding. Although Dr Jermiin's position was an expensive one, Dr Davis' evidence was that budgetary considerations were not per se directly relevant to matters relating to his redundancy and that it was not a criticism of Dr Jermiin that he had had no track record of securing external funding. His Honour found that Dr Davis had said that it was simply a statement of fact that "the lack of external funding by the Applicant was a factor in the weighing of matters relating to redundancy". 19 His Honour found that Dr Davis had sought out other possible positions for Dr Jermiin and ascertained that, within CSIRO, only 60 per cent of the funding was available that would have been necessary to retain him, but regrettably the balance was not. The trial judge found that, in summary, Dr Davis' evidence was that it was not a case of Dr Jermiin not having expertise or capabilities relevant to CSIRO but "more so that across the whole of CSIRO there was not demand for his capabilities sufficient to create or maintain his position." Dr Davis said that ultimately Dr Marshall as chief executive officer, and other senior executives, had determined the number of redundancies in the Land and Water division and that he, Dr Davis, was not part of those discussions. 20 His Honour found that both Dr Jermiin and Dr Davis gave their evidence fairly and in a straightforward manner, having regard to the fact that Dr Jermiin was the aggrieved party and Dr Davis, effectively, was seeking to defend his employer, gave the impression that he was more of a "company man", and was careful to keep his evidence in accordance with CSIRO's stated policy (at [79]). His Honour found that the documentary and oral evidence confirmed that the employment relationship between Dr Jermiin and CSIRO was "ending and ultimately ended" as a result of policy decisions taken by CSIRO that required significant restructuring based to a significant degree upon financial considerations (at [83]). 21 His Honour referred to principles applicable to the consideration of whether an employee's position was redundant. He applied, correctly, the test that Bray CJ synthesised in R v Industrial Commission of South Australia; Ex parte Adelaide Milk Supply Cooperative (1977) 16 SASR 6 at 8, namely: A dismissal for redundancy seems to be a dismissal, not on account of any personal act or default of the employee dismissed or any consideration peculiar to him, but because the employer no longer wishes the job the employee has been doing to be done by anyone. 22 His Honour found that CSIRO had made a determination "based essentially on commercial considerations to restructure its operations". That necessarily involved changes to its workforce across a varied number of its departments, including Land and Water. As a result of that change in policy in early 2016, CSIRO communicated the general details of the restructure to its staff at all levels. 23 In response to the critical issues raised by the parties, the trial judge found that, first, Sch 3 of the enterprise agreement had the effect of varying or supplementing Dr Jermiin's contract of employment, secondly, CSIRO had to comply with cl 5 of Sch 3 in order to terminate Dr Jermiin's employment on the grounds of redundancy and, thirdly, CSIRO had complied with cl 5 of Sch 3 because Dr Davis had carried out the assessment required in cl 5(b) and determined that there was no ongoing organisational requirement for Dr Jermiin's skills, as referred to in cl 5(c). His Honour found that, objectively, Dr Davis' assessment was correct. 24 His Honour found that CSIRO had to comply with cl 5 in Sch 3 because cl 7(b)(iv) of Dr Jermiin's contract of employment did not elaborate on the basis on which CSIRO could terminate his employment for redundancy. He held that the enterprise agreement provided a process in Sch 3 and, in particular, cl 5, albeit that it was not a perfect or unambiguous process. 25 Critically, his Honour made the following findings in relation to the third issue (at [124]– [125]): Again, I will not repeat the consideration of the evidence outlined earlier in these reasons. Summarised, that evidence, both oral and documentary, in my view, plainly established that Dr Davis was the relevant Line Manager for the purposes of Clause 5 of Schedule 3 of the EA. It also plainly established that Dr Davis, along with relevant consideration by, among others, Dr Hardisty and Ms Rogers, (i) was/were cognisant of, and sought to apply, the new (or renewed) policy of the CSIRO that emphasised the need for relevant external funding sources, and (ii) did so specifically in relation to the circumstances and capabilities of the Applicant. The consideration by Dr Davis of the Applicant's capabilities, and likewise by Dr Hardisty (and others noted in the documentation referred to earlier in these reasons and set out in the Court Book), confirmed that there was no ongoing organisational requirement within the CSIRO for the Applicant's skills as referred to in Clause 5(c) of Schedule 3. It was the confluence of the CSIRO's publicly stated policy emphasis (by Dr Marshall) upon external revenue sources, on the one hand, and the determination that the Applicant did not relevantly meet this particular requirement, on the other, which led Dr Davis, confirmed by Dr Hardisty, to the conclusion that the Applicant (together with a significant number of other officers employed by CSIRO in a wide range of departments or sections of the organisation) were excess, or superfluous to the CSIRO's organisational requirements. (emphasis added) 26 His Honour then explained that, applying the principles of construction for industrial agreements such as those explained by Magwick J in the classic decision of Kucks v CSR Ltd (1996) 66 IR 182 at 184, it was necessary to adopt a pragmatic approach. His Honour said that redundancy did not relate to the personal competence of the individual employee and that matters of management, policy, reorganisation and the operational requirements of a business were recognised grounds for redundancy. 27 His Honour reiterated that, based on economic and commercial considerations, CSIRO had determined to restructure its operations in a way that necessarily involved a change in its workforce, creating significant redundancies in a number of its departments, including Land and Water. He found that (at [134] to [138]): The process undertaken by Dr Davis, which involved others such as Dr Hardisty (with advocacy on the Applicant's behalf by Dr Oakshott), in my view, clearly sought to implement the economically rationalist management policy of the CSIRO that emphasised the singular importance of external revenue sources. This ultimately led to a series of redundancies throughout the CSIRO, across a range of sections or departments. The Applicant was one of the CSIRO's many officers who was relevantly affected or "impacted" by the implementation of this management policy. In my view, Dr Davis (and Ms Rogers), among others, relevantly carried out the assessment required under Schedule 3 of the EA in relation to the Applicant. There was no detail in either the contract of employment, or in the EA, that prescribed what was to be done, or how the assessment was to be conducted, by the relevant Line Manager, other than in the most general terms. The Line Manager here, Dr Davis (aided by others), came to the conclusion, after attempting to find a position for the Applicant via the process of redeployment, that there was no ongoing organisational requirement or position within the CSIRO available to the Applicant. As such, his redundancy was confirmed. The assessment was undertaken by Dr Davis as outlined in his Affidavit and in his oral evidence set out earlier in these reasons. The Applicant was afforded procedural fairness, as required under the EA, as also outlined earlier in these reasons. Because of the reasons set out above, and because of the specific issues identified by both parties, I do not need to make any determination on the subtle argument in the Respondent's submissions (pars.38 – 42) regarding how or why certain parts of Schedule 3 of the EA do not (or did not) in fact apply to the Applicant. That said, in addition to my own reasons, subject to the qualification just made, otherwise I accept and adopt the submissions of the Respondent, including the submission that Schedule 3 of the EA did not in fact specify any particular process to be followed in cases of redundancy. In my view, the processes undertaken by and on behalf of the CSIRO to give effect to the economically-driven management policy announced by Dr Marshall in early 2016, and the resulting personally and professionally unfortunate and regrettable determination of the Applicant's redundancy (doubtless the same regret and human toll on the Applicant was felt similarly by all other officers made redundant at CSIRO), (a) complied with the terms of the EA (as a supplement to the contract of employment), and therefore (b) does not give rise to any relief (including compensation) for the Applicant. Accordingly, the Amended Application, filed 10th May 2019, must be dismissed. 28 The trial judge noted that the parties had not addressed the concept of "genuine redundancy" under s 389 of the Fair Work Act and he did not see the need to do so. I raised with counsel for the parties whether that provision did apply, having regard to what his Honour had said in the reasons. It was common ground that it does not arise. In effect, their position was, which I accept for the purposes of this appeal, that s 389 applies to proceedings in the Fair Work Commission (as opposed to a court) for wrongful dismissal and for redundancy. In the present case, there was no suggestion that Dr Jermiin had not received a redundancy payment that significantly exceeded any amount that he would otherwise have been entitled to in the national employment standard embodied in s 119 of the Fair Work Act and that his case was not being put as one of wrongful dismissal under that Act. This appeal 29 Dr Jermiin argued, in his notice of appeal, that the trial judge erred in finding that Dr Davis had carried out properly the assessment required in cl 5(b) and (c) of Sch 3 to the enterprise agreement. He contended that his Honour should have found that his termination was in breach of his contract and the enterprise agreement because there was an ongoing organisational requirement for his skills at CSIRO. Dr Jermiin submitted that CSIRO continued to need his skills for the ongoing performance of the work of, among others, the Land and Water division. In addition, Dr Jermiin argued that his contract provided that his employment was for an indefinite term and that the nature of his functions as CSOF 8 gave him tenure equivalent to full professorial tenure in an academic environment. He asserted that this construction was supported by the circumstances in which he had originally been employed in the office of the chief executive, as a researcher in a position that was wholly internally funded. 30 Dr Jermiin relied on his evidence that, following his termination, CSIRO continued to employ persons within his area of expertise, albeit at a more junior level, making them less expensive to employ. He argued that his job description fell within the second category in level 8 in Sch 6 of the enterprise agreement (see [7] above). He contended that this category reflected the fact that, until 2016, no part of his role required him to raise funds, being a function included in the kinds of work in the first category in level 8. He submitted that, in addition, no term of his contract of employment required that he raise funds and that glowing reviews of the quality of his work and contribution to science for CSIRO showed that he had unique skills, as the trial judge found. 31 He argued that an employer could not have a proper basis to find a position such as his redundant because, subsequent to his or her employment, the employer wished the employee to have an additional skill, such as the capacity to raise finance, that had not been a requirement of his position previously. He relied on Vickery J's summary of principles in Hodgson v Amcor Limited (2012) 264 FLR 1 at 68–69 [371] that Sackville AJA, with whom Emmett JA and Adamson J agreed, endorsed in UGL Rail Services Pty ltd v Janik (2014) 246 IR 320 at 346–347 [130]–[132]. 32 Dr Jermiin argued that cl 5(c) of Sch 3 required an assessment by the line manager of what the relevant employee's skills actually were, as opposed to what a new or different job from those which the employee's then current job might require. He contended that this did not entitle the line manager or CSIRO to make the assessment by reference to a new requirement that the employee be able to generate revenue. He submitted that the word "no" in the expression "no ongoing organisational requirement for the officer's skills" was emphatic and should not be construed as allowing the employer to say that, while the skills that the employee actually had were useful for its ongoing requirements, he needed further skills to retain his position if he were not to be made redundant. Dr Jermiin argued that his Honour erred in failing to apply his finding that CSIRO had acted on a new criterion of "external revenue generation" that was determinative of whether a person in his position could remain in its employ. He contended that this meant that Dr Davis would not have applied cl 5(c) correctly, had he been conscious of it, and that objectively CSIRO actually had an ongoing organisational requirement for Dr Jermiin's skills. 33 In argument today, CSIRO rehearsed a submission that it had put to the trial judge which, confusingly, he adopted in the alternative, namely that Sch 3 did not apply to Dr Jermiin's position, after his Honour had found that it did apply. However, CSIRO did not file a notice of contention and it is not appropriate to have regard to that alternative argument. Consideration 34 The parties are at issue on this appeal, substantively, with the trial judge's third composite finding (set out at [#24] above), namely, as to whether CSIRO complied, subjectively and objectively, with the requirements of cl 5 in Sch 3. 35 In Lee v Lee (2019) 266 CLR 128 at 148–149 [55], Bell, Gageler, Nettle and Edelman JJ said: A court of appeal is bound to conduct a "real review" of the evidence given at first instance and of the judge's reasons for judgment to determine whether the trial judge has erred in fact or law. Appellate restraint with respect to interference with a trial judge's findings unless they are "glaringly improbable" or "contrary to compelling inferences" is as to factual findings which are likely to have been affected by impressions about the credibility and reliability of witnesses formed by the trial judge as a result of seeing and hearing them give their evidence. It includes findings of secondary facts which are based on a combination of these impressions and other inferences from primary facts. Thereafter, "in general an appellate court is in as good a position as the trial judge to decide on the proper inference to be drawn from facts which are undisputed or which, having been disputed, are established by the findings of the trial judge". (citations omitted; emphasis added) 36 Redundancy cases can be particularly distressing for an employee who is in a situation where the relationship of employment is one of an ongoing and continuing nature. This arises in circumstances where an employer no longer requires the job that the employee performs to be done by anyone. In Concut Pty Ltd v Worrell (2000) 176 ALR 693 at 697– 698 [17], Gleeson CJ, Gaudron and Gummow JJ noted that employment relationships are not usually purely contractual. They said statutes could impose obligations to observe industrial awards or agreements and, in some instances, relevant terms of the employment relationship can be found in an industrial award that binds the parties at a particular time. They also observed that employment relationships are not static in their terms, but evolve over time. As the relationship continues, changes may be characterised as either an amendment to the original contract or a substituted new contract. Such changes do not involve any breach, but occur in ongoing employments including, for example, where an employee is promoted to a new position, given new duties and or his or her salary increased. 37 In Janik 246 IR at 346–347 [130]–[132], Sackville AJA said: Vickery J quoted extensively from the authorities, including Foster's Group v Wing [(2005) 148 IR 224]. He said (at [371]) that: subject to any qualification or re-statement found in the relevant contract of employment or any applicable statute, the common law concept of "redundancy" comes down to the following propositions: (a) A job becomes redundant when the job of the employee ceases to exist because the employer, for whatever reason, whether by reason of reorganisation, mechanization, change in demand or other reason, no longer desires to have it performed by anyone; (b) This can occur either when the role no longer exists or the duties have so changed that for all practical purposes the original role no longer exists; (c) However, redundancy is not limited to the circumstance where the employer, no longer desires to have the work previously performed by the terminated employee done by anyone; (d) A redundancy may also arise upon the redistribution of job functions, where the duties performed by an employee are redistributed among other employees. In this case the employer still requires the duties to be performed, but the re-organisation may give rise to a redundancy. In this event, although the duties remain to be performed, "for all practical purposes the original role no longer exists" because the duties are divided and assigned amongst others. In such a case the question is whether any function or duty remains to be performed by the employee. A redundancy will occur if, after the reorganisation, the employee in question is left with no duties to discharge; and (e) Redundancy will not arise where the termination of employment is carried out solely because of any personal act or default of the employee terminated or for any consideration peculiar to that employee. (Citations omitted) The opening words of this extract must be kept in mind: the starting point for analysis must be the language of the relevant statute, award or contract of employment. Subject to this qualification, Vickery J's analysis in my view accurately summarises the principles stated in the cases. The key concept is that the job performed by the claimant ceases to exist, or the duties have so changed that for all practical purposes the role no longer exists. This concept cannot be applied in the manner of a mathematical formula. A difficult judgment may have to be exercised, for example where the nominal position remains in place but the duties of that position are substantially altered: see Commonwealth Bank of Australia v Finance Sector Union at [27]. Similarly, if the name of the position has been changed, but many of the duties and responsibilities attached to the previous position are retained, there may be no redundancy. But the fact that the duties attached to a position have changed or some responsibilities have been transferred to other positions does not establish that the position, or the occupant of the position, has been made redundant. Ordinarily, it is necessary for the employee claiming to have been made redundant to show that the changes in the duties and responsibilities of a position are so substantial that for practical purposes the position no longer exists. That may come about in a particular case where a position appears to continue (whether under the name or a different name), but the duties and responsibilities of the position are so substantially altered that it is largely stripped of its functions. (emphasis added) 38 Here, the enterprise agreement, by force of the Fair Work Act, imposed terms in cl 5 of Sch 3 where CSIRO, as an employer, was considering making an employee, such as Dr Jermiin, redundant. 39 One of the difficulties in the present case is that, as his Honour found, Dr Davis paid no attention to the requirements of cl 5 because he did not understand it to apply to Dr Jermiin, albeit that he appears to have followed in substance what cl 5 required, unconsciously rather than deliberately. In addition, in dealing with the task required under cl 5(b) in Sch 3, Dr Jermiin was able to make submissions to Dr Davis and Dr Hardisty and others to correct their original, mistaken, underestimation of the broad range of his skills and abilities. 40 Under cl 5(b), in situations where there were to be redundancies, the line manager had to address what the organisational requirements of CSIRO would be looking forward, not backward. The purpose of cl 5 was to deal with the impact on officers whose positions were no longer required because the reorganisation would result in either the reduction or abolition of a number of positions for a particular skill set, or the creation of a new position that required particular qualifications that CSIRO had not previously specified for such a position. 41 Thus, cll 2(a)(i) and 5(b) contemplated that in certain situations there would be a group of officers, for example numerous payroll clerks, some of whose positions would potentially become redundant. In such a case, CSIRO would have to consider how many of them would be needed in the future to fill the defined role of payroll clerk and the individual clerks in the group would not be required to make a formal application for their existing role. Nonetheless, if CSIRO decided to reduce the number of those positions, the line manager would have to determine which employee or employees would be made redundant. The basis for making that decision was governed by the provisions of cl 5(c), namely, a determination whether there was no ongoing organisational requirement for each individual officer's skills. 42 I reject Dr Jermiin's argument that CSIRO was not entitled to embark upon a restructure that, in effect, required fundraising to be a part of a role for an employee with his skills if he or she were to continue in employment. However, it is difficult here to understand how his ability to engage in fundraising played any part in the restructure. That is because there was no new role in which a person with Dr Jermiin's scientific skills would be employed if he or she had also the capacity to raise funds. Rather, the decision appears to have been that there would be no role for someone with his level of skills and no requirement that someone with such skills would also be responsible to raise funds. 43 While there seems to have been some concentration on external revenue generation being critical for CSIRO's 2020 strategy, I think that Dr Hardisty's email of 16 August 2016 must have meant that a decision was taken not to create a new role for Dr Jermiin, being a decision based on the lack of his skills or capacity to raise funds. That seems to have been the basis of his Honour's finding that the power of "external revenue generation" was what forced CSIRO's hand. In other words, the restructure decision was not so much that a new role would be created that Dr Jermiin could not fulfil, but rather that, in pursuing the restructure, CSIRO had decided not to create a role for him because it perceived that he did not have sufficient fundraising capacity and it did not otherwise have sufficient funds to support his position. That situation had arisen even though CSIRO wished to, and did, continue to engage in scientific research and development in various fields of expertise, using persons of lesser capacities than him: Hodgson 246 FLR at 69 [371](d). 44 I think this is what the trial judge ultimately found as being the "economically driven management policy" announced by Dr Marshall in early 2016, and the resulting personally and professionally unfortunate and regrettable determination of the applicant's redundancy. 45 In my opinion, cl 7(b)(iv) of Dr Jermiin's contract and the enterprise agreement permitted CSIRO to engage in a structural reorganisation that could cause Dr Jermiin's job to become redundant. That is because it no longer had a position at his level with his skills, as a result of implementing its own policy decision not to support such a position where, for example and as happened, it could only provide resources to meet 60 per cent of his ongoing salary. Like the trial judge, one may consider that this is an unfortunate situation, particularly in an organisation such as CSIRO, where a person with Dr Jermiin's skills has been made redundant because of financial considerations. 46 Dr Jermiin did not challenge his Honour's findings of fact as to what Dr Davis did. Rather he based his challenge on whether or not Dr Davis had applied cl 5 of Sch 3 of the enterprise agreement correctly. While it is obvious from his Honour's findings that Dr Davis paid no regard to cl 5 in arriving at his decision, having seen and heard the witnesses, his Honour concluded that nonetheless Dr Davis in substance performed the task that cl 5 required and that he did so correctly. Accordingly, I am not satisfied that the trial judge erred in making his findings of fact by reference to his assessment of the whole of the evidence and the construction of the enterprise agreement: Lee 266 CLR at 148–149 [55]. Conclusion 47 For the reasons I have given, I am not satisfied that his Honour erred in the construction of cl 5. It follows that the appeal must be dismissed. I certify that the preceding forty-seven (47) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Rares. Associate: Dated: 30 August 2021