Suzanne Tollis & Australian Services Union v Transport Workers Union of Australia [1995] IRCA 535

INDUSTRIAL RELATIONS COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY VI 2431 of 1995 B E T W E E N : SUZANNE TOLLIS & AUSTRALIAN SERVICES UNION Applicants AND TRANSPORT WORKERS UNION OF AUSTRALIA Respondent Before: Judicial Registrar Staindl Place: Melbourne Date: 3 October 1995 REASONS FOR JUDGMENT Background In May 1993 Suzanne Tollis ("the Applicant") commenced employment with the Transport Workers Union of Australia ("TWU") and worked in its Victorian branch. She replied to an advertisement for the position of secretary\receptionist and was to work with "Driver Link" an entity run by the Respondent. The objective of Driver Link was to provide a service to the TWU's unemployed members by attempting to match them up to transport companies in need of drivers. In effect, Driver Link was providing the sort of service offered by a personnel agency. At the time of the Applicant's employment a Mr Robin Arndt was employed to run the Driver Link operation. However, he left his employment in about August 1993 and I am satisfied that the Applicant took over most of his functions and duties. She received a pay increase of about $2,000 p.a. to take her salary to about $33,000 p.a. with 15% superannuation. Mr Arndt had been paid a considerably higher amount in this role. The Applicant described herself as the "Manager" of Driver Link and had business cards printed which so described her. I am satisfied that the Respondent was aware that she was using this title and acquiesced in it although it is unnecessary for me to decide whether or not her duties could properly be described as those of a manager. Suffice it to say that the Applicant was dissatisfied with her level of pay and raised the issue with the Respondent. The Applicant's union, the Australian Services Union ("ASU"), wrote to the Respondent on 6 December 1994 seeking wage parity with the previous incumbent of the Applicant's position. As a result of this letter a meeting was organized on 17 January 1995 and it was agreed that an independent assessment would be made of the position. Ms Tanya West carried out this assessment. The "agreed objective" of this assessment was:- "To assess the position held by Suzanne Tollis at Driver Link and to review the current pay structure." Ms West spoke to the Applicant on several occasions and prepared a report dated April 1995. This report was presented to a meeting of those responsible for the running of Driver Link (called "directors") on 7 April 1995. More will be said about this meeting later. On 31 March 1995 the Applicant wrote a memo to Mr Noonan, the Respondent's Victorian branch secretary. In it she stated that she would not attend the Driver Link meeting on 7 April because of a highly offensive comment made to her the previous day by one of the union's organisers. In fact the Applicant went home early on 31 March (a Friday) and saw a doctor on 2 April. She subsequently provided a medical certificate to the Respondent to cover the period 3 April to 8 April (inclusive). The Applicant gave evidence that she rang the Respondent's office on the morning of 3 April to say that she was ill and wouldn't be attending work that week. She said that she spoke to Sharon Firth, the receptionist and left a message with her. This evidence gained some support from Corine King, a former employee of the Respondent. She gave evidence that Sharon Firth had told her that the Applicant was on special leave for the week and that the office manager knew about it. The Respondent's case was that the Applicant did not inform anyone in the office that she would be absent for the week because of illness. The Respondent denied that the Applicant had rung in on Monday 3 April and left a message to that effect. The telephone message books maintained by the receptionist were tendered in evidence and there was no record of the Applicant's call. I accept that the Applicant did make the call about which she gave evidence on 3 April. I rely on her evidence and that of Ms King and take note of 3 matters insofar as the Respondent's case was concerned. Firstly, Ms Firth was not called to give evidence, nor any explanation given as to her absence. Secondly, the first entry in the message book is for 9.40am on 3 April when the office opened at 7.30am. This fact and the fact that some of the entries in the book are out of chronological order cause me some concern in that it suggests that entries in the book were not always made at the time of receipt of the message. Furthermore the last entry in the previous book is for 11.50am on Friday 31 March: it would surprise me if no telephone message were received between 11.50am on one day and 9.40am on the next (business) day. It may be that there was some delay in completing one message book and obtaining another one. Thirdly, if the Respondent's version were to be correct it seems strange to me that no one from the Respondent's office contacted the Applicant to inquire about her absence from work if it had no knowledge about her absence for a week due to medical reasons. Lack of consultation with Applicant My finding that the Applicant had informed the Respondent on 3 April about the reasons for her absence from work in that week leads me to the conclusion that the Respondent went ahead with the scheduled meeting concerning Driver Link on 7 April in the knowledge that the Applicant would not be attending although absent for medical reasons. This meeting was of vital importance to the Applicant as the report of Ms West was tabled and accepted. Further, the directors of Driver Link decided to recommend to the branch secretary (Mr Noonan) that the operations of Driver Link be transferred to ADIA Industrial Pty Ltd, a personnel agency. It seems to me that this meeting should not have gone ahead when the Applicant was absent for medical reasons. There was nothing in the evidence to suggest that the holding of the meeting was particularly urgent on that there would be serious difficulties in having it scheduled. Insofar as the Applicant was aware the meeting was to deal with the report of Ms West. The Respondent argued that this report was meant to deal with the Applicant's position as well as the future of Driver Link. Earlier I have set out the agreed objective of the report. In my view it was not one of the objectives of the report to consider whether or not the Respondent should continue to fund the operation of Driver Link. Although some reference was made in the report to the future prospects of Driver Link, there was no proper evaluation of Driver Link's value to the Respondent or any alternative options. Accordingly I find that the Applicant did not know that consideration was being given to making her position redundant and she was not consulted about it. It is surprising that there was no consultation with the Applicant or her union, the ASU. I am satisfied that an award applied to the Applicant's employment and it provides for there to be consultation with the ASU prior to a definite decision being made to make a position redundant. There was unchallenged evidence led on behalf of the Applicant that there had been no such consultation. The Respondent's evidence on this point was unsatisfactory. In presenting the Respondent's case the only witness called from the Respondent itself was Mr Lester, a senior official with the Victorian branch of the TWU. He gave evidence that as one of the directors of Driver Link he attended the meeting on 7 April. He said that Driver Link could only make a recommendation to the branch secretary and there was no obligation to consult at that stage. However, Mr Noonan, the branch secretary also attended this meeting (and he was not a director of Driver Link). The evidence reveals that a letter of termination signed by Mr Noonan and dated 7 April was hand delivered to the applicant that day. Furthermore a circular regarding the change to Driver Link was produced on 7 April. In these circumstances the evidence led by the Respondent is disingenuous. The person responsible for the decision to make the Applicant's position redundant attended the meeting of the Driver Link directors. Apparently he accepted the recommendations of the meeting (and I think it likely that his acceptance occurred simultaneously with the making of the recommendation). And yet no consideration was given to consulting the ASU about the redundancy. It is possible that had the Applicant or the ASU been consulted prior to the decision being made that some course of action may have been found other than the cessation of Driver Link's operations. Alternatively some further time may have been allowed to the Applicant to wind up Driver Link. In my view there was a valid reason for the termination of employment, that being the Respondent's operational requirements. A better service could be offered by ADIA Industrial Pty Ltd and it would cease to be a drain on the Respondent's resources. However in my view the Respondent's failure to consult with the Applicant prior to the termination constituted a breach of s.170DE(2) in that the termination was harsh. Given my finding concerning the Respondent having a valid reason for the termination under s.170DE(1) I am of the view that reinstatement is impracticable (and there is no alternative position to which the Applicant could be appointed). I turn to the question of compensation. Compensation The amount of compensation in such cases is always difficult. The Respondent has breached the Act although it did so in circumstances where it had a valid reason for terminating the Applicant's employment under s.170DE(1). It seems to me that the Applicant's employment would not have continued for a lengthy period and that she should have been paid for a period of 3 months after the date of termination. However, some of the payments already made should be taken into account. The Respondent was reasonably generous to the Applicant in paying out her benefits on termination. The Applicant was paid 8 weeks severance pay: under the award she was only entitled to 4 weeks. She was paid 4 weeks' pay in lieu of notice: the award provided for 2 weeks in her case. She was also paid an extra week's pay for being over 45 years of age and was paid out her accumulated sick leave amounting to $761.27: the benefits were not in the award. Thus, she was paid an additional 7 weeks' pay and the amount of $761.27. Using her weekly salary of $638.65, this totals an additional amount of $5,231.82. This amount should be deducted from the 3 month's compensation which I have found to be appropriate. Mr Moore also argued that 2 weeks' annual leave paid to the Applicant upon termination exceeded her entitlements. This was an extra week's leave (representing the week between Christmas and New Year) provided to staff. However, it may well be that the extra week is a part of the Applicant's conditions of employment (albeit above the award) and I am not prepared to deduct payment for these 2 weeks from the amount of compensation. In addition to the payments made by the Respondent to the Applicant on her termination I am satisfied that the Respondent made efforts to have the Applicant placed with AIDA Pty Ltd. I think both parties can be criticized for not pursuing this possibility further: perhaps if the ASU had been consulted prior to the redundancy then some sort of guarantee of employment could have been obtained from AIDA Pty Ltd. Three month's salary (or 13 weeks) comes to $8,302.45 together with 15% superannuation gives $9,547.82. From this sum should be deducted the amount of $5,231.82, giving $4,316. There will be an order in favour of the Applicant for this amount. Identity of Respondent There is one further issue. When this matter was called on for hearing I queried the identity of the Respondent. It is well known that a branch of a registered organisation does not have a separate legal existence. See Williams v Hursey (1959) 103 CLR 30 at 53-55 per Fullagar J. and RANF (Tasmania Branch) v Fawdry (1986) 12 FCR 113. The application filed in this Court named the "Transport Workers Union" as Respondent. However a notice of appearance was filed by the "Transport Workers Union of Australia Vic Branch", and it stated that the employer had not been correctly named in the application. Although Mr Moore stated that his "client" would abide the decision of the Court, I was concerned that any order which I might make would be unenforceable. Mr William (Bill) Noonan gave evidence on this point. In addition to his position as Branch Secretary he also held the position of Federal Vice President of the TWU. He had spoken to John Allen, the TWU's Federal Assistant Secretary, about this matter and had been advised that the Victorian branch of the union should deal with the present application as it arose out of a person's employment within the Victorian branch. It was put that it is not uncommon for matters pertaining to employees within a branch to be dealt with by that branch and I accept that this is the case. Because of the above matters I am satisfied that the TWU was on notice about the proceedings but that it chose to be represented through the Victorian office. I am also satisfied on the evidence that the Respondent is correctly identified as the "Transport Workers Union of Australia", and not the Transport Workers Union. I will make an order to that effect. MINUTES OF ORDERS THE COURT ORDERS: 1. That the name of the Respondent be substituted by the "Transport Workers Union of Australia". 2. That the Respondent pay to the Applicant the sum of $4,316.50 within 21 days. NOTE: Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules. I certify that this and the preceding nine (9) pages are a true copy of the reasons for judgment of Judicial Registrar Staindl. Associate: Dated: 3 October 1995 Representative for Applicant: Mr S Lennon from Australian Services Union Representative for Respondent: Mr S Moore from Transport Workers Union of Australia, Victorian Branch Date of hearing: 25, 26 September & 2 October 1995 Date of judgment: 3 October 1995