FEDERAL COURT OF AUSTRALIA

 

Elliott v Kodak Australasia Pty Ltd (ACN 004 057 621) [2001] FCA 807

 

INDUSTRIAL LAW – Redundancy – Whether redundancy in breach of ss 298K and 298L of the Workplace Relations Act 1996 (Cth) – Whether employee dismissed because he was a union delegate -  Meaning of delegate under ss 298L(1)(a) and 298(1)(n) of the Workplace Relations Act 1996 (Cth) – Whether redundancy selection criteria inherently biased against employee in role as delegate - Whether employee dismissed because he was a member of a union – Whether the contract between the employer and the employee had been terminated – Whether reasonable notice was given

Workplace Relations Act 1996 (Cth) Pt XA, ss  298K, 298L, 298T, 298V

Photographic Industry (Kodak) Australasian Manufacturing and Distribution Award 1990

Commonwealth Conciliation and Arbitration Act 1904 (Cth)

Commonwealth Conciliation and Arbitration Act (No 2) 1914 (Cth)

Commonwealth Conciliation and Arbitration Act 1920 (Cth)

Commonwealth Conciliation and Arbitration Act 1947 (Cth)

Commonwealth Conciliation and Arbitration Act 1973 (Cth)

Industrial Relations Act 1988 (Cth)

Pearce v W D Peacock and Co (1917) 23 CLR 199 referred to

National Union of Workers v Qenos Pty Ltd [2001] FCA 178 considered

Plumton v Cathay Hotel Pty Ltd (1987) 21 IR 410 considered

Cuevas v Freeman Motors Pty Ltd (1975) 25 FLR 67, 8 ALR 321 considered

Stapleton v African Lion Safari Pty Ltd  (1982) 65 FLR 61 considered

Australian Municipal, Administrative, Clerical and Services Union v Ansett Australia Ltd [2000] FCA 441, (2000) 175 ALR 173 at [59] referred to

Kenefick v Australian Submarine Corporation (1995) 62 IR 107 at 117- 118 referred to

Ralph v Fortis Australia Ltd (Australian Industrial Relations Commission, Commissioner Smith, 14 December 2000, T4482) referred to

Community and Public Sector Union v Telstra Corporation Ltd [2001] FCA 267 compared

Byrne v Australian Airlines (1995) 185 CLR 410 considered

Brackenridge v Toyota Motor Corporation Australia Ltd (1996) 67 IR 162 followed

Australian National Hotels Pty Ltd v Jager (2000) 9 TasR 153, [2000] TASSC 43 cited

Brackenridge v Toyota Motor Corporation Australia Ltd (1996) 142 ALR 99 referred to

Quinn v Jack Chia (Australia) Ltd (1991) 43 IR 91 at 103 referred to

Macken, McCarry & Sappideen The Law of Employment 4^th ed. 1997 at 166 - 167

JOHN ELLIOTT & AUSTRALIAN LIQUOR, HOSPITALITY AND MISCELLANEOUS WORKERS' UNION v KODAK AUSTRALASIA PTY LTD (ACN 004 057 621)

 

V 513 OF 2000

 

MARSHALL J

MELBOURNE

29 JUNE 2001

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 513 OF 2000

 

BETWEEN:	JOHN ELLIOTT FIRST APPLICANT   AUSTRALIAN LIQUOR, HOSPITALITY AND MISCELLANEOUS WORKERS' UNION SECOND APPLICANT
AND:	KODAK AUSTRALASIA PTY LTD (ACN 004 057 621) RESPONDENT
JUDGE:	MARSHALL J
DATE OF ORDER:	29 JUNE 2001
WHERE MADE:	MELBOURNE

 

 

 

THE COURT ORDERS THAT:

 

1.         The application be dismissed.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 513 OF 2000

 

BETWEEN:	JOHN ELLIOTT FIRST APPLICANT   AUSTRALIAN LIQUOR, HOSPITALITY AND MISCELLANEOUS WORKERS' UNION SECOND APPLICANT
AND:	KODAK AUSTRALASIA PTY LTD (ACN 004 057 621) RESPONDENT

 

JUDGE:	MARSHALL J
DATE:	29 JUNE 2001
PLACE:	MELBOURNE

REASONS FOR JUDGMENT

1                     This is an application made pursuant to s298T of the Workplace Relations Act 1996 (Cth) (“the Act”) and pursuant to the accrued jurisdiction of the Court. The first applicant, Mr Elliott, was at all material times a member of the second applicant, the Australian Liquor, Hospitality and Miscellaneous Workers’ Union (“the LHMU”). Mr Elliott was employed by the respondent, Kodak Australasia Pty Ltd (“Kodak”) until he was terminated on 22June 2000. The applicants alleged that in terminating Mr Elliott, Kodak engaged in conduct in breach of Div 3 of Part XA of the Act in that it dismissed Mr Elliott for a prohibited reason. The chief prohibited reason referred to was that Mr Elliott was a delegate of the LHMU. Relief was also sought in the nature of a declaration that the contract between Mr Elliott and Kodak had not been terminated. An order for specific performance of that contract was also sought. In the alternative, a sum representing reasonable notice was requested.

2                     The matter was heard over a number of days in late February and late March 2001. Mr Mark Irving of counsel appeared for the applicants. Mr Michael McDonald of counsel appeared for the respondent.

1. Factual background

3                     Mr Elliott commenced employment with Kodak in November 1982 at its Coburg site. There are approximately 500 employees engaged in manufacturing at this site. Mr Elliott was involved in the dispersionarea (which involves the mixing of chemicals for the treatment of photo paper) and worked in Building 2.

4                     The terms and conditions of Mr Elliott’s employment were regulated by the Photographic Industry (Kodak) Australasian Manufacturing and Distribution Award 1990 (“the award”) and the Kodak Australasia Pty Ltd Manufacturing Operations 2000 Enterprise Bargaining Agreement.

5                       Soon after commencing employment with Kodak, Mr Elliott became a member of the LHMU. The LHMU has a strong presence at Kodak with nearly 100% membership in its areas of coverage at the Coburg site. Within each building at the Coburg site there may be two or more delegates to represent different shifts, or different areas of work. There is also a site delegate, who at all material times was Spiros Vasilakis.

6                     In April 1999 Mr Elliott was elected, unopposed, by members of LHMU in Building 2 as the delegate for the dispersion area. At the same time, Mr Hall was elected as the delegate for the emulsions section in Building 2 and Mr Burns was elected as the delegate for chemical preparations section in Building 2

Mr Elliott’s Activism

7                     The terms and conditions of Mr Elliott’s employment were regulated by the Photographic Industry (Kodak) Australasian Manufacturing and Distribution Award 1990 (“the award”) and by the Kodak Australasia Pty Ltd Manufacturing Operations 2000 Enterprise Bargaining Agreement (“the EBA”). Mr Elliott gave evidence that prior to his election as a delegate he was active in pursuing numerous complaints about industrial issues on behalf of himself and others with whom he worked. Those issues included various health and safety issues and matters connected to the introduction of 12 hour shifts.

68                  After becoming a union delegate Mr Elliott was involved in several industrial issues that affected LHMU members in the dispersion section. Those issues included the following:

·        the payment of overtime rates for the working of an extra shift from August 1999

·        changing the way “improvement time” was scheduled

·        shift changes in November/December 1999

·        shift changes in February 2000 and the ensuing payment of an additional loading of 3.57% of employees in the dispersion section

·        the introduction of new solvent

·        the provision of a female toilet in the section

·        discussions in April/May 2000 about further shift changes

9                     It is generally accepted that Mr Elliott was an active delegate, who had considerable success in issues he had been involved in negotiating.

710               Mr Elliott was also involved in other issues that were more concerned with conflict between different sections of the workforce rather than conflict between employee and management interests. Those issues included:

·        problems with chemical preparations section employees, including:

Ø      the transfer of gel barrels

Ø      confrontations with Mr Burns and with Ms Gillies, the Supervisor for the chemical preparations section

·        problems with an industrial chemist, Mr Guinea

811               In the course of carrying out his responsibilities as a delegate, Mr Elliott was involved in many meetings with management. He was also involved in some meetings in his capacity as an employee of Kodak as distinct from as an LHMU delegate. In some meetings Mr Elliott passionately presented his views to management. There is a conflict in the evidence concerning whether he did so inappropriately on occasions. There was also a conflict in the evidence concerning Mr Elliott’s attitude to Kodak’s intention to spread the concept of “high performance work teams” throughout the buildings at its Coburg site.

Redundancy Procedure

912               On 9 June 2000, the Manager in Building 2, Mr Matthew Lay, wrote a memorandum to all 23 employees in the dispersion section. The memorandum advised the employees in that section of Kodak’s desire to effect redundancies in the section. The memorandum asked for “expressions of interest from people interested in receiving a redundancy package”. It also stated that:

“We will select people to continue in the dispersion operation based on the best mix of teamwork, know how, initiative, future potential and attendance. Where there is little difference in the selection criteria between candidates, we will take into account people’s expressions of interest.”

1013            Mr Elliott advised Mr Lay by a note on a returned memorandum that he was not interested in being considered for a redundancy package. Mr Elliott gave evidence that he did not want to work in a section where he would be liable to work night shifts. The only other available jobs for transfer had day/night shift operations.

1114            Employees were selected to be made redundant if they received one of the lowest seven scores based on certain selection criteria. The relevant selection criteria were divided into four categories comprising of:

·        Teamwork

·        Know how

·        Initiative

·        Other attributes

15                   For current purposes only the teamwork category is relevant. The team work category was further divided into the following criteria:

·        good team player

·        respect the dignity of others; Models Kodak Values

·        resolves conflict effectively

·        [involvement in] High Performance Work Teams (“HPWT”)

1216            Mr Elliott was one of the employees who was selected to be made redundant having received one of the lowest seven scores. Mr Elliott was the only one of the six employees from the dispersion area eventually retrenched who did not express an interest in redundancy.

2. applicants’ contentions under part xa of the act

17                  Mr Irving, on behalf of the applicants, submitted that Kodak’s selection of Mr Elliott for redundancy was based on reasons which included prohibited reasons under s298L of the Act. Namely, it was contended that Mr Elliott had been selected for redundancy because he was “an officer, delegate or member” of the LHMU.

18                  The central issue in the proceeding concerned whether Mr Elliott was retrenched because he was a union delegate.

2.1 was Mr Elliott a union delegate – the no case submission

19                  At the conclusion of the applicants’ evidence, Mr McDonald informed the Court that he wished to make a no-case submission with respect to the part of the applicants’ case which alleged that Mr Elliott was a delegate of the LHMU. Counsel contended that he should be able to put that submission without being put to his election as to whether to call evidence. I agreed with that contention on the basis that if the no-case submission was successful it would considerably reduce the evidence required to be adduced from the respondent’s witnesses. I also considered that the legal argument upon which the no-case submission was based was one that had to be addressed at some stage of the proceeding and there was no good reason why it should be deferred. Therefore, in the interests of justice, I considered that the no-case submission should be advanced without Kodak being put to its election.

20                  It is appropriate to consider the no-case submission prior to the substantive issue, as it is relevant to the substantive issue and also gives insight into the applicable legislation.

Respondent’s No-Case Submissions

21                  Section 298K of the Act provides, inter alia, that an employer must not dismiss an employee for a reason that includes a prohibited reason. Section 298L of the Act contains a list of prohibited reasons. Section 298L(1)(a) of the Act provides inter alia that:

“Conduct referred to in subsection 298K(1) or (2) is for a prohibited reason if it is carried out because the employee … :

(a)               is, has been, proposes to become or has at any time proposed to become an officer, delegate or member of an industrial association.”

22                  Mr McDonald’s central contention in the no-case submission was that Mr Elliott was not a delegate within the meaning of s298L(1)(a) of the Act.

23                  There is no dispute in this proceeding that Mr Elliott performed the duties of a union delegate and was recognised by Kodak management as the LHMU delegate for the dispersion section in Building 2. As noted above under “Factual Background”, Mr Elliott was nominated by LHMU members at a meeting held for the purpose of electing LHMU delegates in the three sections in Building 2. Mr Elliott’s nomination to represent the dispersion section was unopposed. He thereafter became the shop-floor representative of the LHMU members working in the dispersion section. However, there was no evidence that Mr Elliott was formally appointed as a delegate within any requirement contained in the LHMU’s rules. Indeed, the registered rules of the LHMU were not tendered to the Court.

24                  Mr McDonald submitted that “irrespective of any evidence regarding the role played by Mr Elliott [as a representative of employees] during the course of his employment” the reference to “delegate” in s298L(1)(a) of the Act refers to a person who occupies a position in accordance with a union’s rules.

25                  In support of his restricted definition of delegate, Mr McDonald sought to rely on authority that held that the predecessor of s298L(1)(n), namely s5(1)(f) of the Concilliation and Arbitration Act 1904, was restricted to delegates appointed in accordance with union rules. In essence, Mr McDonald’s submission was that “delegate” as referred to in s298L(1)(a) must be restricted to the type of “delegate” read in to s298L(1)(n). Mr McDonald submitted:

“There is … no express reference to ‘delegate’ in s.298L(1)(n), but this is unnecessary because of the definition of officer in s.298B. Both s.298L(1)(a) and s.298L(1)(n) create categories of prohibited conduct in respect of a person who is a delegate. It flies in the face of ordinary rules of statutory construction that in the absence of a clear expression of statutory intention, 2 sub sections of the same section of an Act can create legal obligations in respect of a delegate yet for the word to have a different meaning in each sub-section.”

26                  However, Mr McDonald’s submission is at odds with the historical under-pinning of the section, which reveals that s298L(1)(a) was never intended to be restricted by s298L(1)(n).

Historical Analysis

27                  Section 298L(1)(a), when read with s298K of the Act is partially the successor provision to s9(1) of the Commonwealth Conciliation and Arbitration Act 1904 (“the 1904 Act”). Section 9(1) of the 1904 Act provides:

“No employer shall dismiss any employee from his employment by reason merely of the fact that the employee is an officer or member of an organisation or is entitled to the benefit of an industrial agreement or award.” [1]

28                  The 1904 Act was amended by the Commonwealth Conciliation and Arbitration (No 2) Act 1914 (Cth). Section 9(1) was varied to read as follows:

“An employer shall not dismiss an employee, or injure him in his employment, or alter his position to his prejudice, by reason of the circumstance that the employee-

(a)               is an officer or member of an organisation, or of an association that has applied to be registered as an organisation; or

(b)               is entitled to the benefit of an industrial agreement or an award; or

(c)               has appeared as a witness, or has given any evidence, in a proceeding under this Act.”[2]

29                  In 1920, sub-section (d) was inserted into s9(1) of the 1904 Act by Act No 31 of 1920. Section 9(1)(d) prohibited an employer from discriminating against an employee by reason of the circumstance that the employee “being a member of an organisation which is seeking better industrial conditions, is dissatisfied with his conditions.” Section 9(1)(d) of the 1904 Act as amended in 1920 is recognisable as the predecessor of s298L(1)(b) of the Act when read with s298K of the Act. It may be observed that the enactment of s9(1)(d) was a legislative response to the judgment of the High Court of Australia in Pearce v W D Peacock and Co (1917) 23 CLR 199.

30                  Act No 10 of 1947 (“the 1947 Amendment”) amended s9 of the 1904 Act by adding the word “delegate” after the word “officer” whenever the word “officer” appeared. The 1947 Amendment re-numbered s9 as s5. Section 9(1)(a) thus became s5(1)(a). The 1947 Amendment also introduced sub-section (e) to s5(1).

31                  Section 5(1)(e) of the 1904 Act provided, inter alia that:

“An employer shall not dismiss an employee … by reason of the circumstance that the employee …

(e) has absented himself from work without leave if –

(i)                 his absence was for the purpose of carrying out his duties or exercising his rights as an officer or delegate of an organisation; and

(ii)               he applied for leave before he absented himself and leave was unreasonably refused or withheld.”

Section 5(1)(e) of the 1904 Act is recognisable as the original predecessor of s298L(1)(m) of the Act when read with s298K. The addition of new paragraphs to s5(1) of the 1904 Act evinced an intention by Parliament to broaden the protection which the section afforded to employees from victimisation by employers.

32                  By the Conciliation and Arbitration Bill No 2 of 1973, the Whitlam Government sought the addition of sub-section (f) to s5(1) of the 1904 Act. The bill, in its original form sought to protect employees who engaged in activities undertaken with implied authority from their union. However, as a result of amendments enforced by a hostile Senate, the activities for which protection was afforded were limited to activities expressly conferred on officers or delegates in accordance with the rules of the organisation. The result of the amendment of the bill was a considerable contraction in the scope of the original protection for officers and delegates which the Government intended to achieve. Consequently s5(1)(f) as added by Act No 138 of 1973 provided so far as is material that:

“An employer shall not dismiss an employee … by reason of the circumstance that the employee …

(f) being an officer, delegate or member of an organisation has done or proposes to do, an act or thing which is lawful for the purpose of furthering or protecting the industrial interests of the organisation or its members, being an act or thing done within the limits of authority expressly conferred on him by the organisation in accordance with the rules of the organisation.”

33                  Section 5(1)(f) of the 1904 Act is recognisable as the predecessor of s298L(1)(n) of the Act when read with s298K of the Act. In 1988, s5 of the 1904 Act was materially reproduced in s334 of the Industrial Relations Act 1988 (“the IR Act”). Section 334 of the IR Act is the immediate predecessor of ss 298K and 298L of the Act.

34                  As the historical analysis shows, over time, Parliament has broadened the scope of the protection afforded by the predecessor provisions to s298L of the Act. At the very least, as Weinberg J said in National Union of Workers v Qenos Pty Ltd [2001] FCA 178 at [125]:

“It may be that [the] additional prohibited reasons were added as a matter of emphasis or clarification rather than any perceived restriction or limitation on the scope of the forerunner to s298L(1)(a).”

For my part, I would delete the reference to “may be” in the above quote and positively assert what is somewhat tentatively suggested therein.

35                  The historical analysis proves beyond doubt that Parliament did not enact s5(1)(f) of the 1904 Act to dilute s5(1)(a) of the 1904 Act. Therefore there is no warrant for the contention that s298L(1)(n) of the Act should be read to dilute s298L(1)(a) of the Act. The prohibited reason in s298L(1)(a) of the Act, insofar as it refers to “delegate”, comprehends someone who, as a matter of fact, is a union delegate irrespective of whether that person has been appointed to that position in accordance with the rules of the organisation.

36                  So far as I am aware, there are no recent judgments under the current Act that discuss the definition of “delegate” in ss 298(L)(1)(a) and 298(L)(1)(n). However, there are a number of decisions dealing with s5 of 1904 Act.

37                  In Plumton v Cathay Hotel Pty Ltd (1987) 21 IR 410, Spender J dealt with a prosecution under s5 of the 1904 Act. The prosecutor was summarily dismissed by the defendant. He was a member of a predecessor union to the LHMU. He claimed, inter alia, that he was dismissed by reason of the circumstance that he was a delegate. Spender J held that while the prosecutor was a representative of the defendant’s workforce at a particular meeting, the prosecutor was not specifically a representative of the union members at that workforce.

38                  In Plumton reliance was placed by the prosecutor on s5(1)(a), (d) and (f) of the 1904 Act. In the context of s5(1)(f) of the 1904 Act and by way of comparison to s5(1)(a), Spender J said at 417:

“Section 5(1)(f) has an additional requirement that the act or thing done for the purpose of furthering or protecting the industrial interests of the organisation or its members be an act or thing done within the limits of the authority expressly conferred on him by the organisation in accordance with the rules of the organisation.” (Emphasis added).

39                  Spender J correctly identified s5(1)(f) as containing “an additional requirement” not required by s5(1)(a) of the 1904 Act. The same can now be said of s298L(1)(n) of the Act when compared to s298L(1)(a) of the Act.

40                  Mr McDonald sought to rely on two cases to support his submission for a restricted construction of s298L(1)(a) – Cuevas v Freeman Motors Limited (1975) 25 FLR 67 (“Cuevas”) and Stapleton v African Lion Safari Pty Ltd [1982] 65 FLR 61 (“Stapleton”).

41                  In Cuevas, a Full Court of the Australian Industrial Court (consisting of Smithers and Evatt JJ), observed at 72, that there was evidence that the prosecutor was elected as a shop steward pursuant to the rules of the relevant union. The Court expressed the view that the prosecutor was “duly elected as shop steward pursuant to the rules”. At 73 the Court said:

“The question is whether an alleged officer or delegate occupies a position in the union by reference to the nature and duties of which he may be said to be an officer or delegate within the meaning of either of those terms in s.5.”

42                  However, this passage does not support the proposition that only those persons who are elected to the position of a delegate strictly in accordance with the rules of a union become delegates for the purpose of s5 of the old Act. The Court convicted the defendant by reference to s5(1)(a) of the 1904 Act. It did not consider s5(1)(f) other than at 78 where it referred to the paragraph as presenting “conduct specified” therein.

43                  Similarly, Stapleton is of no assistance to the respondent. In Stapleton, Ellicott J considered the meaning of delegate under s5(1)(f) of the 1904 Act. At 69, Elliott J held that:

“… par (f) contemplates a delegate who is appointed in accordance with the rules.”

Ellicott J also considered the meaning of “member” under s5(1)(a) of the 1904 Act. However, his Honour did not consider the meaning of “delegate” under s5(1)(a) or whether this meaning should be read down in light of s5(1)(f).

44                  See also Australian Municipal, Administrative, Clerical and Services Union v Ansett Australia Ltd [2000] FCA 441 at [59], (2000) 175 ALR 173 where Merkel J said:

“An officer is defined in s 298B as including a “delegate or other representative of the association”.  If a delegate or a shop steward is elected to represent employees under a union’s rules that person may be an “officer” as defined and therefore fall within s 298K(1)(n): see Cuevas v Freeman Motors Pty Ltd (1975) 25 FLR 67 at 72-73.  As the present case is only concerned with s 298K(1)(a) it is unnecessary to resolve that issue.”

45                  Kodak additionally contended that its interpretation of s298L(1)(a) was supported by s298B of the Act. It was submitted that ss 298B(2) and 298B(3) reinforced the view that a delegate was a person who was formally appointed under the rules of an industrial association.

46                  I find no assistance from sub-sections (2) and (3) of s298B of the Act in determining the meaning of the word “delegate” for the purposes of s298L of the Act. Section 298B(2) is a deeming provision for the purposes of proceedings taken against industrial associations. It has no application to proceedings which are designed to enforce the rights of industrial associations, their representatives and members. The role of s298B(3) is to exempt certain action from the reach of 298B(2). It does not bear on proceedings designed to enforce the rights of industrial associations and their representatives and members to operate or work without being victimised.

47                  It would be an odd result, to say the least, if a deeming provision such as s298B(2) or s298B(3), dealing with issues divorced from protection of organisations, could be used to support a restrictive approach to the meaning of “delegate” in s298L(1)(a). So much is especially so given the historical background to s298L and its predecessor provisions. The submission that s298B of the Act can be called in to narrow the meaning of s298L is one which is devoid of merit and is rejected.

48                  It also must be borne in mind that Div 3 of Part XA of the Act does not create criminal offences, unlike s5 of the 1904 Act and s334 of the IR Act. Part XA of the Act is beneficial legislation which must be interpreted broadly and not in a restrictive, narrow or technical way. As Weinberg J said in Qenos at [48]:

“The objects of Pt XA are remedial in nature.  One such object is to protect the rights of individuals who are members or officers of industrial associations from discrimination and victimisation.  Similar provisions in other legislation have been treated as remedial and construed beneficially:  IW v City of Perth (1997) 191 CLR 1.  Where a remedial law also has a penal aspect, such that the two principles of construction conflict, it has been held that the principle of strict construction should yield to the principle of beneficial construction: see Employment Advocate v National Union of Workers (2000) 173 ALR 479 at 487 per Einfeld J, and the cases cited therein.”

49                  For the forgoing reasons the Court rejected the no-case submission and found Mr Elliott was a delegate for the purposes of s298L(1)(a) of the Act.

2.2 Kodak’s Onus

1350            Pursuant to s298V of the Act the onus lies on Kodak to prove that in dismissing Mr Elliott it did not do so for reasons which included a reason that Mr Elliott was a delegate of the LHMU. In the particular circumstances of this matter this onus has two limbs. First, the respondent has to prove that the redundancy selection criteria was not inherently biased against Mr Elliott in his role as a union delegate, or union delegates in general (“the selection criteria”). Second, the respondent has to prove that Mr Elliott was not selected for redundancy because he was a union delegate, and then allocated low points under the selection criteria. (“the decision making process”) To attempt to discharge this onus, Kodak relied upon the evidence of the Kodak representatives who were involved in the creation of the selection criteria and the decision making process which led to Mr Elliott being made compulsorily redundant. Those persons were as follows:

·        Mr Scott McGowan, previous Manager in Building 2

·        Mr Brian Lay, Operations Manager in Building 2

·        Mr Ken Shannon, Team Adviser in the dispersion area in Building 2

·        Mr John Walshe, Director and General Manager

·        Mr Geoff Thompson, previous Team Adviser in the emulsion area in Building 2

·        Ms Carmel Gillies, previous Supervisor in the chemical preparation area

2.3 The selection criteria

51                  As noted above the selection criteria used in the June 2000 redundancies consisted of four categories – “teamwork”, “know how”, “initiative” and “other attributes”. The main issue in this proceeding was Mr Elliott’s ranking under “teamwork”. The “teamwork” category was further divided into the following criteria:

i.                     Good team player

ii.                   Respects the dignity of others; Models Kodak values

iii.                  Resolves conflict easily

iv.                 [involvement in] High Performance Work Teams (HPWT)

 

52                  Similar selection criteria was used by Kodak for redundancy rounds in August 1998 and January 1999. In the 2000 redundancies reference to “Models Kodak Values” and “HPWT” were added. Mr Lay made these changes in consultation with Mr Shannon. Ms Sally Francis, the Human Resources Manager, and Mr Walshe approved the changes. In Mr Lay’s affidavit he explains the basis for these changes as follows:

“The changes were made by me for the following reasons:

a.                  the Kodak high performance work team concept has become more important to the business over time;

b.                  respecting the dignity of others is only one Kodak value and I thought it important to make reference to all Kodak values…”

53                  I am cognisant of the fact that subjective redundancy criteria is open to abuse and is open to be used to target particular workers. Wilcox CJ discussed some of the problems of subjective criteria in Kenefick v Australian Submarine Corporation (1995) 62 IR 107 at 117-118:

“It seems to me that the problem about [subjective] criteria … is not so much the fact of their adoption, but the burden they impose on those who have to apply them. Because they require subjective assessments, the affected employees cannot really make a contribution to the selection decision. The risk of unfairness is high. The criteria need to be determined at a senior level. But if they include such day-to-day factors as commitment, attitude and supervisory requirement, there must be input by a supervisor working close to the relevant employees. At the same time, there is a risk of such a person being influenced by an extraneous factor, such as personal like or dislike.”

54                  At least concepts such as “good team player” and “resolves conflict effectively” can have broader community meaning. Concepts such as a particular company’s “values” or “work concepts” are far more problematic. See for example Ralph v Fortis Australia Limited (Australian Industrial Relations Commission, Commissioner Smith, 14 December 2000, T4482). This is particularly the case if the company’s work “values” or “work concepts” are controversial and have not yet been accepted by employees or the relevant union as part of the rules that govern employees’ working conditions. For example, if a union disputed the introduction of a company’s “work concept" that consisted of a reduction in conditions for some workers, it would clearly be unfair to have adherence to that work concept as a criterion for redundancy selection.

55                  In the current proceeding the “Kodak values” are as follows:

1.      Respect for the dignity of the individual

2.      Integrity

3.      Trust

4.      Credibility

5.      Continuous improvement and personal renewal

6.      Recognition and celebration

56                  These values, while clearly subjective, would appear to fit in to concepts that have “broader community meaning” discussed above.

57                  In respect to the HPWT criterion, Mr Lay has given evidence that the HPWT have been in the making at Kodak for the last five years. Furthermore, there appears to be acceptance by the union of HPWT’s introduction. Clause 1.1 of the most recent enterprise bargaining agreement entered into by Kodak and the LHMU says:

“This Agreement has been developed by the parties to expressly support the Kodak Manufacturing Division and its employees in achieving the Business Goal of improving its competitive position and supporting employees by providing greater job security and improvement in working conditions. The key platform for achieving this goal has been the division wide thrust for the development and implementation of High Performance Work Teams across the site.” (Emphasis added).

58                  Although, as noted above, I have general reservations about subjective selection criteria, I do not consider that in this particular instance the selection criteria was inherently biased against Mr Elliott in his role as a union delegate or union delegates in general.

2.4 the Decision Making Process

59                  The input of each of the respondent’s witnesses into the decision making process differs considerably. Mr Lay and Mr Shannon played a fundamental role in that they were in charge of applying the selection criteria and allocating the initial scores to employees. Mr Lay and Mr Shannon were pivotal in allocating Mr Elliott the score he received that ultimately led to his redundancy.

60                  After allocating the initial scores Mr Lay and Mr Shannon met with Mr Thompson and Ms Gillies to discuss the ranking of the employees, given that each of the supervisors had a different understanding of the capacities of certain employees. After consultation with Mr Thompson and Ms Gillies, one change was made to the score of an employee other than Mr Elliott.

61                  Mr Lay asked Mr McGowan to review the ranking. Mr McGowan had managed the dispersion section prior to Mr Lay taking on that role. Mr McGowan agreed that Mr Elliott and four others, whom he knew, should be retrenched.

62                  On 21 June 2000, the rankings were discussed with Mr Walshe. Mr Walshe was at all material times the General Manager of Kodak’s Coburg operations. He was the person with the ultimate authority to terminate the employment of employees. Mr Walshe suggested a change in one of Mr Elliott’s scores, which reduced his overall score, but made no difference to his selection for redundancy.

Mr Lay’s Evidence

1563            Mr Lay is employed by Kodak as its Operations Manager in Compress Manufacturing Color Paper Flow (Building 2). He commenced in that position in March 2000 but has been continually employed by Kodak since January 1990. He was at all material times responsible for the operations in Building 2 at Kodak’s Coburg plant.

1664            Mr Lay gave detailed evidence in which he described the process he and Mr Shannon went through in ranking the employees. Mr Lay gave evidence that by 8 June 2000 he and Mr Shannon had ranked the twenty-three employees into four groups for the purposes of the criteria. He said:

“Each employee received a rating of either 0, 3, 6 or 9 against each criteria depending on which 4 groups they fell into. A score of 0 simply meant that a person ranked in the lowest of the 4 groups. For example, a score of 0 for teamwork meant that a person ranked in lowest of the four groups for teamwork, not that the person had no teamwork skills.”

1765            Mr Lay added that:

“We worked through the process by criteria rather than by person as we thought this would make the process more objective. We did not know a person’s total score or ranking until after that meeting -  I added up the scores after the meeting. We also got to compare everyone at once against the one criteria. I thought that this made the process more ‘blind’. The aim was to have the scores against each criteria (sic) equally spread, but if it was apparent that a particular employee did not fit into a particular rating, we did not force them into that rating.”

2166            In the period 8 June 2000 to 15 June 2000 it became known to Mr Lay that Mr Elliott was likely to receive a score which would make him liable to be made redundant. It was also known by Mr Lay that Mr Elliott would be likely to be the only employee to be made redundant against his will. Therefore, in the period 8 June to 15 June 2000, Mr Lay compiled a series of file notes dealing with incidents relevant to Mr Elliott’s low score. No file notes were made in relation to other employees but it was clear that Mr Elliott was the only person likely to be made redundant who may challenge his selection either in the Australian Industrial Relations Commission or in this Court.

67                  Mr Lay went to some lengths to attempt to justify the scores given to Mr Elliott. It is not for the Court to examine in detail and evaluate the scores given so as to sit as a defacto appellant tribunal reviewing the scores given to employees. It is the function of the Court to consider whether, on the evidence as a whole, Kodak has discharged the onus imposed on it by s298V of the Act.

68                  In an affidavit filed with the Court, Mr Lay said he did not take any of the industrial issues that Mr Elliott was involved in in his capacity as a delegate into account when assessing Mr Elliott. Under cross-examination Mr Lay initially appeared to contradict this by saying that he took into account acts done by Mr Elliott in his capacity as a delegate to determine whether Mr Elliott was a good team player or resolved conflict effectively. What the specific acts were was not the subject of further immediate cross-examination, but the way Mr Lay approached the teamwork and resolution of conflict criteria is illustrated by his treatment of those topics in his first affidavit filed in the proceeding.

2569            Mr Elliott was ranked lowly by Mr Lay in relation to the criteria of “good team player” and “resolves conflict effectively” having regard to:

·        Mr Elliott’s pushing of a fellow employee (Mr Partington) in late 1998

·        Mr Elliott’s alleged shouting at Mr Lay on 10 May 2000 that Mr Lay could not be trusted

·        Mr Elliott’s alleged swearing at Mr Lay on 31 May 2000

·        Complaints against Mr Elliott made by fellow workers including Mr Burns, Mr Guinea and Mr Gillies, and

·        Mr Elliott’s role in disputes between two sections of the workforce about which of them should perform certain tasks

2670            In my view none of these matters, properly characterised, involved Mr Elliott in his role as a delegate representing the views of LHMU members in dispersion to management over an industrial issue. The only incident that comes close is the demarcation dispute between chemical preparation and dispersion employees about who was to perform certain work. However, this was fundamentally a matter which was capable of resolution between the two groups, who were both represented by LHMU delegates. Mr Lay effectively considered, and in my view rightly, that this issue (and another issue about access to a locked office) was a puerile dispute between two groups of workers, not assisted by the animosity which existed between the two LHMU delegates in the respective areas.

71                  In an affidavit filed in the proceedings, Mr Lay gave evidence that he had no reason to “punish or single Mr Elliott out… as far as his role as a delegate went”. In support of this claim Mr Lay listed the industrial issues that caused him to come in contact with Mr Elliott in his delegate role, emphasising that these issues were generally resolved amicably. The examples given by Mr Lay included:

·               “The staggered shifts that resulted from the overtime bans… were a “win win result. The company obtained extra capacity for very little extra cost.”

·               “The Easter leave loading issue… was a minor one that was ultimately decided by the pay office’s inability to distinguish between different types of annual leave.”

·               “The Queen’s Birthday holiday issue was a minor one and a good outcome for the company.”

·               “Mr Elliott’s insistence that the roster be reduced from 6 to 5 days instead of a 6 day 12 hour per day roster to a 6 day 8 hour per day roster cost the company nothing and Mr Elliott’s claim for the 5 days to be worked from Tuesday to Saturday was rejected.”

2772            In reality, in admitting that he did not distinguish between Mr Elliott’s role as an employee and a delegate when considering the teamwork issue, Mr Lay was doing no more than saying that to the extent Mr Elliott acted as a delegate in any incident relevant to his teamwork assessment, his role was minor. I do not consider Mr Lay to have effectively admitted that he rated Mr Elliott lowly on this criterion because Mr Elliott was a delegate. Rather, Mr Lay appeared to be chiefly concerned about the inappropriate behaviour engaged in by Mr Elliott.

2873            In assessing Mr Elliott’s involvement in HPWT Mr Lay gave evidence that he took into account Mr Elliott’s negative attitude towards HPWT. In his affidavit Mr Lay said:

“In expressing these views [against HPWTs] Mr Elliott appeared to be conveying his personal opposition to HPWTs. At no stage did he indicate to me that his opposition reflected an official position of the union.”

Under cross-examination Mr Lay remained adamant that he saw issues concerning HPWT as not bearing on Mr Elliott’s role as a union delegate. I have no reason to doubt that evidence.

2974            I am satisfied that in deciding to rate Mr Elliott lowly by reference to the selection criteria for redundancy Mr Lay was not motivated by the fact that Mr Elliott was a union delegate. While Mr Lay appeared to be a slightly nervous witness, especially in the initial phase of his cross-examination, he did not appear to me to be a witness who was untruthful or prepared to embellish his evidence to advance the case of Kodak.

Mr Shannon’s Evidence

3075            The other key person in the decision making process was Mr Shannon, the Team Adviser (Supervisor) in the dispersion area.

3176            In his affidavit evidence Mr Shannon said that:

“At no stage did I ever take into account Mr Elliott’s position as a union delegate when I applied the redundancy criteria to him. Mr Elliott, as a union delegate, was entitled to express his opinions, discuss issues or raise concerns with me or with others in relation to workplace matters.”

3277            Under cross-examination, Mr Shannon was asked whether when he assessed Mr Elliott by reference to the redundancy criteria he gave consideration to Mr Elliott’s role as a delegate. Mr Shannon replied that:

“I don’t think I gave much consideration as to whether he was a delegate or not. I think in my affidavit I refer to a number of incidents which I didn’t feel that he respected the dignity of employees and I think in all of these he was now acting as a delegate.”

3478            Mr Shannon admitted that in assessing Mr Elliott by reference to the team player criterion he had regard to how Mr Elliott “got on with management”. However, Mr Shannon’s focus appeared to be on whether Mr Elliott could express his views in a forthright manner whilst still showing respect to the recipients of his views. It was not equivalent to an admission by Mr Shannon that Mr Elliott was rated lowly because he stood-up to management on behalf of LHMU members. A delegate can stand up for the rights of union members without being unnecessarily aggressive.

Mr Walshe’s Evidence

3579            Mr Walshe was the most senior Kodak representative involved in the process that led to Mr Elliott’s termination. He delegated the task of selection of those to be retrenched to Mr Lay and Mr Shannon, but I accept the evidence of Mr Lay that Mr Walshe’s final approval was necessary to effect the terminations that flowed from the process put into train by Mr Lay and Mr Shannon. In his affidavit, Mr Walshe said that:

“My role in respect of the assessments was to check the process used by Mr Lay and Mr Shannon and make sure that if there was a tie between the scores of 2 or more employees, those employees who had expressed interest in being retrenched were chosen.”

Mr Walshe also said that Mr Elliott’s score was reduced by three points “following discussions between myself and Mr Lay and Mr Shannon about the score of 9 that Mr Elliott was given for ‘implements improvements’ criteria.”

3680            Critically Mr Walshe said that:

“Mr Elliott’s involvement in the enterprise bargaining negotiations and other industrial issues at the plant in no way influenced or motivated my views about his assessment against the criteria by Mr Lay and Mr Shannon.”

3781            Mr Walshe was not cross-examined on that aspect of his evidence. Having regard to the evidence of Mr Lay and Mr Shannon referred to above and to the evidence of Mr McGowan which I shall shortly deal with, I do not consider the above evidence of Mr Walshe to be improbable. Therefore, I consider the fact that Mr Walshe was not cross-examined on that evidence to be a critical factor in support of Kodak’s discharge of its onus under s298V. (Compare Community and Public Sector Union v Telstra Corporation Ltd [2001] FCA 267 at [23] to [30], where certain evidence given by a Mr Cartwright was recorded as having “a degree of improbability” about it, but no cross-examination occurred on that aspect of his evidence and no findings were made by the primary judge with respect to s298L(1) of the Act.) In any event, if I am incorrect in assuming that Mr Walshe played a role in the dismissal of Mr Elliot, it does not affect my views about the reasons actuating Mr Lay and Mr Shannon.

Mr McGowan’s evidence

3882            Mr McGowan was the manager of the dispersion section until March 2000. His input was sought by Mr Lay and Mr Shannon on the redundancy process undertaken in June 2000. Mr McGowan gave evidence that in coming to his view about Mr Elliott’s ranking he did not have in mind Mr Elliott’s role as a union delegate. As with Mr Walshe there was no cross-examination on that aspect of Mr McGowan’s evidence. I see no reason to reject it and I consider it to be entirely plausible. Mr McGowan presented as an impeccably honest witness whose evidence should be accepted.

Evidence of other Kodak witnesses

3983            Mr Thompson and Ms Gillies did not add anything to the process other than confirmatory opinions. I have not considered Mr Guinea’s evidence for the purpose of s298V of the Act because he had no role other than a consultative one in the process that led to Mr Elliott’s dismissal.

84                  The evidence as a whole from Kodak witnesses presented a compelling picture of Kodak being an employer which continues its historical support of the right of its workforce to collectively bargain and the right of union delegates to represent the workforce, with the expectation that such delegates will not act disrespectfully to management and vice versa. An enlightened modern trade union movement could not quibble with that approach. In fact, other evidence before the Court reveals a co-operative approach between other union delegates on site and Kodak management, including the principal delegate for the LHMU on site, Mr Vasilakis.  As noted above, in recording this view I am cognisant of the fact that subjective redundancy criteria is open to abuse. However, I can only act on evidence, and the evidence before me in this case together with my observation of those who gave evidence about how they conducted the redundancy process, leads me to believe that the process as it was applied in June 2000 was not utilised to target Mr Elliott.

2.5 The applicants’ evidence

4085            The evidence adduced by the applicants, including evidence given by Mr Elliott, does not bear upon whether Kodak has discharged its onus under s298V of the Act. If the evidence of Kodak witnesses had been improbable with respect to Kodak’s reasons for dismissing Mr Elliott one could legitimately have regard to the applicants’ evidence to highlight that improbability. However for reasons earlier given that evidence was not improbable.

4186            It is not the function of the Court to act as a Royal Commission into the activities of Mr Elliott since 1998, industrial or otherwise. I have no reason to doubt that Mr Elliott considers that he was a thorn in the side of management and I have no reason to doubt that he suspects that he was targeted for dismissal. However the objective evidence points to the contrary position. I mean no disrespect to Mr Elliott or the other witnesses called by the applicants in not making specific findings on each issue they raised. Whether someone was wrong to write a rude note, whether Mr Elliott swore or not, or whether Mr Elliott shouted or not is not germane to whether Kodak has discharged its onus under s298V of the Act. Similar remarks may be made about the significance or otherwise of Mr Elliott’s role in representing LHMU members on industrial issues (for example the introduction of new solvents and the provision of a female toilet).

2.6 Member

4287            The applicants also contended that Mr Elliott was dismissed because he was a member of the LHMU. I reject that submission. Mr Elliott was, like everyone else who worked in the dispersion area, a member of the LHMU. His selection for redundancy had nothing to do with his membership of the LHMU, whether as an active member or otherwise.

2.7 Conclusion in respect of contentions under Part XA of the act

4388            I do not consider that Kodak breached s298K of the Act when read with s298L of the Act when it dismissed Mr Elliott. That aspect of the application accordingly fails.

3. The accrued jurisdiction claims

4489            The applicants contend that Mr Elliott was not terminated at law. I reject that submission. I find that he was dismissed on redundancy grounds. I therefore reject the application for a declaration that his employment remains on foot and I also reject the application for specific performance of his contract of employment.

 Reasonable Notice

4590            In the alternative, Mr Elliott claimed reasonable notice consisting of twelve months’ pay in respect of his termination. The award prescribed a period of one month’s termination pay. Mr Elliott was in fact paid three months’ termination pay in lieu of notice.

91                  The Court received written submissions on the issue of reasonable notice after it reserved its judgment. The central issue concerned whether the award provision relating to notice usurped the implication of a term relating to reasonable notice in Mr Elliott’s contract of employment. This called for a consideration of the High Court decision in Byrne v Australian Airlines Ltd (1995) 185 CLR 410 (“Byrne”) and the later decision of Beazley J in Brackenridge v Toyota Motor Corporation Australia Ltd (1996) 67 IR 162 (“Brackenridge”).

92                  In Byrne at 422 to 423 their Honours, Brennan CJ, Dawson and Toohey JJ held:

 “In the absence of any provision in the award and of any express provision in the contract of employment the law would regard it as a legal incident of the contract that it should be terminable upon reasonable notice or summarily for serious breach.” (Emphasis added).

93                  Mr Irving submitted that their Honours in the above passage did not intend to remove the possibility of implying a term regarding notice when an award prescribed a minimum period of notice. Mr Irving contended:

“In my submission, their Honours were referring in that passage to a situation in which the “provision in the award” or “the express provision in the contract” dealt with the same subject matter as the implied term in a manner that was inconsistent with the implication of the term. In my submission the majority were alluding to circumstances in which the award granted a positive right to an employer to dismiss on the provision of 4 weeks notice … They was (sic) not referring to award clauses that granted additional minimum rights to employees similar to the rights granted by section 170CM of the WR Act.”

94                  In reply Mr McDonald relied on Beazley J’s judgment in Brackenridge. In Brackenridge, after considering Byrne, Beazley J held at 189:

“…where an Award governs a particular aspect of employment there is no room for the implication of a term relating to precisely the same subject matter.”

95                  Mr McDonald further noted that Beazley J’s judgment in Brackenbridge was cited with approval by the Full Court of the Supreme Court of Tasmania in Australian National Hotels Pty Ltd v Jager [2000] TASSC 43 (“Jager”). Nor was this aspect of Beazley J’s decision disturbed on appeal to the Full Court of the Industrial Relations Court of Australia: Brackenridge v Toyota Motor Corporation Australia Ltd (1996) 142 ALR 99.

96                  I do not consider Beazley J was clearly wrong in Brackenridge in coming to the view referred to above and am content to follow her Honour’s judgment. I therefore reject Mr Irving’s submissions on the topic of implied terms. I am fortified in that view by the High Court’s refusal to grant special leave in Jager: see Application for Special Leave to Appeal in Jager v Australian National Hotels Pty Ltd H3/2000 (5 April 2001).

97                  Alternatively, even if the award provision did not exclude the implication of a term regarding notice, it is most unlikely in the circumstances that an implied term would have provided for more than three months notice.

98                  In determining what is reasonable notice in a particular case consideration should be given to a number of factors including, amongst others, the length of employment, the seniority of employment and the importance of the position. See Quinn v Jack Chia (Australia) Ltd (1991) 43 IR 91 at 103 per Ashley J. See also Macken, McCarry & Sappideen The Law of Employment 4^th ed. 1997 at 166 – 167. The fact that Mr Elliott was employed by Kodak for over seventeen years lends itself to an argument that any implied term regarding reasonable notice should be longer than the standard one month. However, having regard to the lack of seniority of Mr Elliott’s position in Kodak’s workforce, I consider twelve months notice would be inappropriate. If the terms of the award did not exclude an implied term regarding reasonable notice, I would have considered that reasonable notice of termination in the circumstances would have been three months. As the Kodak paid Mr Elliott three months wages in lieu of notice, any obligation to pay reasonable notice has been discharged.

Order

99                  For the foregoing reasons the Court orders that the application be dismissed.

I certify that the preceding ninety-nine (99) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Marshall.

Associate:

Dated:              29 June 2001

Counsel for the Applicant:	Mr M Irving
Solicitor for the Applicant:	ALHMWU
Counsel for the Respondent:	Mr M McDonald
Solicitor for the Respondent:	Blake Dawson Waldron
Dates of Hearing:	20, 21, 22 February 2001; 19, 21, 22, 23, 26, 27and 28 March 2001.
Completion of Written Submissions:	10 April 2001
Date of Judgment:	29 June 2001