THE INDUSTRIAL MAGISTRATE'S

COURT OF WESTERN AUSTRALIA

HELD AT PERTH

 Claim No. M 65 of 2001

Dates Heard: 16 and 17 October 2001

BEFORE:  WG.Tarr I.M.

B E T W E E N :

Raymond Anthony Giddings

Claimant

and

Austal Ships Pty Ltd

Respondent

Appearances:

Mr KJ Trainer of Industrial Relations & Advocacy Services appeared as agent for the Claimant.

Mr S Heathcote instructed by Clayton Utz, Lawyers appeared as agent for the Respondent.

REASONS FOR DECISION

(Given extemporaneously at the conclusion of the hearing, extracted from the transcript of proceedings and edited by His Worship)

HIS WORSHIP: The issues in this matter are not complicated.  The facts that have been put before the Court are generally not in dispute.  This is a claim pursuant to the provisions of section 51 of the Workplace Agreements Act 1993 which provides for an employee, who is subject to a workplace agreement, to bring an action before the Industrial Magistrate's Court if that person considers he has been unfairly dismissed from his employment.

Section 18 of the Act implies into every workplace agreement the provision that an employer must not unfairly, harshly or oppressively dismiss an employee from his employment if he is a party to the agreement.  In section 49 of the Workplace Agreements Act 1993 “unfair”, in relation to dismissal, includes harsh or oppressive;

There is no dispute that the claimant in these proceedings, Mr Raymond Anthony Giddings, was a party to a workplace agreement.  The evidence before me is that he was party to a workplace agreement with firstly Oceanfast Marine Pty Ltd (Oceanfast), and then in October 2000 he went to another company in the Austal Group, Austal Ships Pty Ltd (Austal), and signed a workplace agreement with that employer.  The latter was an agreement which had a qualification, and that was that the workplace agreement had been established for a secondment (internal transfer) for approximately 8 to 12 weeks.  At the expiry of that period the claimant was to return to Oceanfast and be covered by his existing registered workplace agreement.

The evidence before me is that the claimant commenced work with Austral as an aluminium welder in accordance with the arrangements that had been made for his secondment from Oceanfast.  It cannot be in dispute that around January and February 2001 there was a situation that developed in Austal which created some concern for the future employment of some of its workforce.

The evidence is that there were two contracts expected to be won by Austal that were lost.  As I understand the evidence, one was for eight 50-metre catamarans which went to a Portuguese company, and the other lost was for a single 80-metre (approximately) ferry.

The first witness for the respondent was Mr Stuart Hill who gave evidence that he was employed as a manufacturing manager with Austal in November 2000.  One of his tasks was to improve the efficiency of Austal.  It was his view that because there were three companies in the Austal Group, the other being Image Marine Pty Ltd, a flexible pool of workmen would produce efficiencies and it was his view that to obtain those efficiencies there would probably be a need for redundancies.  When the loss of contracts was added to the intention to pool the workforce, the fact that there were going to be redundancies became apparent, it would seem from the evidence, some time towards the end of January; and steps were put in place after consultation with the Workplace Representative Committee (WRC), and the notices that have been referred to and as have been described by the witnesses cascaded down.

There was a system in place where decisions were made in consultation with the WRC.  As a result of that, policies were formed. There was further discussion with the WRC, and once there was confirmation or agreement with the step that was going to be taken by the company, that was put into a notice and went through the command system, if you like, and finally, that document would be placed on a notice board.

I would have thought it would have been well known within the workforce of Austal that things were happening which may result in a reduction of the workforce.  It was said by Mr Mockett that there were rumours about that towards the end of January 2001.  The company put the first step in place, and that was a reduction of the working hours from 45 to 38 hours.  That took effect from 31 January 2001 (exhibit K1), and the implementation of that, matching hours to days, was contained in the next instruction, which was sent to all employees (exhibit K2).

I do not think I can come to any other conclusion on the evidence other than there were commercial decisions made, based on the downturn in work, which led to the justification of the reduction of the workforce, and as I understand Mr Hill's evidence, between 13 February and some time in May, in excess of 300 employees were made redundant.

The method of redundancy was explained by the respondent.  The manager for the particular area was given a number of positions which were going to be affected and the decisions were made based on a number of criteria.  In relation to the claimant, there was evidence that he had received two written warnings and a verbal warning, and it was the evidence of Mr Mockett that on other occasions the complainant had to be spoken to about his performance.

In evidence Mr Mockett said that it was his opinion that the claimant was a competent welder who was easily distracted and who was inclined to distract others by talking and joking with them.  He was prone to ignore safety requirements and that became more critical at Austal because their safety standards were rigidly enforced.  The safety breach the claimant was involved in related to a failure to wear personal protective equipment supplied to safeguard workers against burns and flashes.

The second written warning the claimant received was the one which followed him being injured while welding.  The circumstances of that were given in evidence by the claimant and by Mr Mockett.  There is some dispute in relation to that evidence.  The claimant contends that the incident occurred on l6 November 2000, because of some defect in the protective shirt he was wearing.  It was a very hot day and, according to his evidence, he took off his leather jacket, which was issued as protective clothing to wear when welding.

There is some dispute in the evidence about what was required.  The last witness did concede that the protective clothing, when welding, did not include the leather jacket, but there is other evidence, to some extent, to counter that.  There is also evidence that suggested that the leather jacket should have been worn when certain welding jobs were being done, but not when some of the lesser welding jobs were being performed.

There were two verbal warnings that had been recorded in a diary, which was tendered by Mr Mockett (exhibits N1 and N2).  One was on 16 November 2000, and that was on the same day as the written warning.  The other was on 20 December 2000, where there was a warning in relation to the holding up of other workers; and evidence has been given about that.

The evidence of Mr Day was that the final list in relation to those who were going to be made redundant was compiled by consensus between the four coordinators together with Mr Clayton and Mr Estimoff.  They sat at a meeting and went through the lists.  It was conceded by at least Mr Estimoff that he relied on the input from supervisors and coordinators, and I suppose that is the sort of reliance one would expect in a big organisation like the respondent company.

The main method of determining who was to be made redundant was based on performance and skills, and there was some reference, in relation to that, to performance assessments and the warnings that had been given.  Mr Giddings’s evidence generally is that his redundancy came as a surprise.  It is the case that those who were made redundant were not given any formal warning of their particular redundancy.  On 13 February 2001 Mr Giddings was called into the office and told that he was one of those who had been chosen for redundancy.  He was given a redundancy letter, which was later amended because of his employment with Oceanfast, which had been overlooked initially.

He was then removed from the premises in the way that has been mentioned.  I do not think there is anyone who would agree that that type of dismissal is necessarily appropriate, but it is the type of dismissal which often happens in industries of this type, where there is a large workforce and where there is a possibility or a risk of sabotage or some other incident, although there is no suggestion in this case that Mr Giddings would get involved in any activity like that.  There were three, apparently, of the 43 or 45 who were given their notice, who were not happy with being told that they were being made redundant.

It was Mr Giddings’ evidence that the decision to terminate him was unfair.  In his particulars of claim he has said it was unfair because he had not been provided with any prior notice of the decision; that the basis on which he had been selected to be made redundant, rather than any other employee of the respondent, had not been provided to him; that he had not had an opportunity of discussing the decision with the respondent, including but not limited to his rights under the workplace agreement and the application of any selection criteria relied on to make him redundant in preference to others prior to the decision to terminate him; that he did not have an opportunity to transfer back to Oceanfast, and that he believed there was sufficient work within the related group to continue his employment.

As stated, I do not think it is difficult for me to find that the respondent company had a legitimate reason for reducing the size of its workforce.  That was the only commercial decision it was able to make at that time.  There has been evidence given that the decision, although suspected, was being deferred in the hope that, even up until the last minute, some of these contracts, which may have been expected, would come through.

Mr Giddings also claims that there was nothing wrong with the way he performed his duties.  He took exception to one of the warning notices that he was given, and took that up with Mr Clayton.  It would seem he had an opportunity to put his case in relation to that matter, and Mr Clayton listened to what he said, but allowed the written warning to stand.

Having found that the respondent employer had a right under the workplace agreement to reduce the workforce, it seemed to me, even before I was referred to the decisions by Mr Heathcote, the agent for the respondent, bearing in mind the onus of proof in these matters is on the claimant, he has the onus generally to satisfy the Court, on the balance of probabilities, that his dismissal was unfair and, as the authorities suggest, one way he could show that is to give evidence and produce evidence to the required standard, that there were others in the workforce who were kept on in preference to him, where he had a better right to retain his employment.

It is clear from the evidence before me that Mr Giddings has not done that.  He was the only witness who gave evidence in relation to his claim, and there is no evidence before me supporting what could be his contention that he should have been kept on, and others perhaps should have gone before he did.

Those for the respondent company who gave evidence ranked Mr Giddings in accordance to where he might fit in when redundancy of members of the workforce was being considered, and all ranked him fairly highly as a candidate who would be considered for redundancy.  Those rankings ranged from being first off the job to being within the first six, and I think to being within the first 10.

It is clear from the evidence of all those witnesses that, contrary to what Mr Giddings may have thought of his performance in the workplace, there are others who supervised him and who were in contact with his employment, who thought he would be one of those considered for redundancy in preference to many others who were working in that area.

There has been some criticism of the subjective manner in which this type of assessment is done, but I think that is the nature of any workplace, and rightly so, that people who are in a supervisory situation can generally rate the performance of their employees.  That has been done in this case.

The claimant complains about the procedural fairness in relation to his dismissal, and relies on the reference that was given by Mr Clayton.  Much was made of that reference, but it is my experience, and probably the experience of everyone in this court-room, that when a reference is sought and given to someone, it is very rare that a reference is given which makes reference to any negative aspects of the employee's performance and, in my view, this is a case of that.

In Mr Clayton's evidence he said that at various times the complainant had contacted him and advised that he was unhappy working where he was, and considering leaving.  He said:

"He went so far as to seek a reference, which I provided."

He explained that the reference he provided to Mr Giddings was an expression of my honest opinion that he was a competent welder, saying further:

“But I did not make any reference to any negative aspects of his performance at work."

When asked to elaborate on that, Mr Clayton said that he believed Mr Giddings may well have performed better in another workplace where he was perhaps happier; that he had the potential to be a competent welder, and it may well be if he had found the right working environment his performance would be satisfactory.

The comments he made in that reference were put to Mr Day, the last witness, and it is my view that those comments were put, to some extent, unfairly, without telling the witness where those comments came from.  It seems to me that the answers that were given to those questions were given based on the questions that were put, without thought to the circumstances that gave rise to those comments.  I do not think I can draw anything in relation to the claimant's competence or fitness from that reference.

The question of procedural fairness has been mentioned in some of the cases that were referred to me, but it is clear from those cases that is just one element which would need to be substantial, to override the comparative test expounded by Brinsden J in the ASI case.  There was no notice given, but the workplace agreement allows for payment in lieu of notice, and as I have said, although it has not come out in evidence, there is a practice in this type of industry not to give notice, for the reasons stated.

The evidence before me is that forty of those who were dismissed in this way accepted the situation, and it was only the claimant and two others who were concerned about the way it was done, and the lack of notice.  The exit of the claimant from the workplace and the cartage of his toolbox have been explained to some extent by the witnesses of the respondent company.  They have an interpretation that it was to save him some humiliation.  It may well have been that they wanted to get the cleared toolbox off the premises before the respondent had an opportunity to get into his car and leave the premises.  I do not think anything turns on that.

The other criticism in relation to procedural fairness was that there was no evidence to show that the claimant had been told of the notices which came out of the meetings on 17 and 30 January 2001, and, in fact, as I understand the evidence he was away on one of the days that the notice may well have been discussed with the workforce.  However, the notices finished up on the notice board, and, as was confirmed by one of the witnesses, there were rumours around about what was going on.  I would be surprised if the claimant would not have known these notices were going on to the notice board.  He had an opportunity to see how things were going because of that.

I accept the evidence that there was a delay for a number of reasons, in relation to advice to the workforce.  It was a decision, as I understand the evidence, made in the hope that the redundancies in the numbers envisaged may not have happened.  I suppose it would go without saying that the process of redundancy is not something that employees or employers have much pleasure in being involved in.  I accept the evidence that there was some hope that contracts may have come through.  Not only would that have reduced the need for redundancy, but it would have meant that there were employees available to perform the task, notwithstanding what Mr Hill said in relation to a lead-up time, even if the contracts had come in.

At best I believe I could find that there may have been some procedural unfairness, but I could not conclude in my view that that has led to any injustice in relation to the dismissal of the claimant, and if there is no injustice then I cannot find that the dismissal was unfair.  In fact, my finding is that the dismissal was caused because of the downturn in the industry at that time, and that the claimant was one of those unfortunate employees who found themselves on the list of those to be made redundant.  There was no unfairness to the level required, or any unfairness, which would give him a claim for any compensation under the Workplace Agreements Act 1993.

The claim is dismissed.

WG Tarr

Industrial Magistrate