INDUSTRIAL RELATIONS
Federal Magistrates Court to be Abolished
In a restructure of the federal court system, the Federal Magistrates Court is to be abolished.

The Family Court and the Federal Court will absorb any matters that currently commence in the Federal Magistrates Court in a new two tiered system.

Matters currently in the Federal Magistrates Court will be absorbed into the new lower divisions of the Family Court and Federal Court.

The Federal Court will be the only court dealing with all general federal law matters with the Court consisting of two tiers:
1) Appeals and other complex matters will generally be heard in the first tier; and
2) Shorter, less complex matters will be heard in the second tier.

Existing judges of the Federal Court will hear matters in the first tier while Federal Magistrates will hear matters in the second tier. 

Upper and lower level Fair Work Australia Divisions will also come under the Federal Court system.

Union Wins Orders Against Redundancy Process
This month the Australian Industrial Relations Commission (the Commission) ordered the Australian Bureau of Statistics (ABS) to end its round of targeted redundancies and allow employees to return to work, after finding that the agency had breached the consultation provisions of the Workplace Relations Act 1996 (Cth) (the Act).

The Commission heard that the ABS targeted individual employees as “excessive” or “underperforming”, with some selected for termination without an opportunity to state their case.  Other employees were directed to immediately leave their jobs to “consider their options” - an approach normally taken when employees are found guilty of serious misconduct.

Senior Deputy President Lea Drake found that the ABS has failed to meet its consultation obligations pursuant to s.668 of the Act, that is, the ABS decided to terminate the employment of 15 of more employees for operational reasons and did not as soon as practicable after so deciding and before terminating employee’s employment:

• inform each union about the terminations and reasons for them, the number and categories of employees affected and the time period over which they intended to carry them out; and
• give each union an opportunity to consult with ABS on measures to avert or minimize the terminations and measures to mitigate the adverse effects of the terminations.

SDP Drake granted in full the orders sought by the Community and Public Sector Union (the CPSU) - effectively putting the employees back to the same position they were in prior to the redundancies.  CPSU management were ordered to:

• withdraw its advice to all employees who were told they were potentially “excess”;
• permit the 28 employees told to leave their jobs and the workplace to return to their positions if they chose to;
• cease the current round of proposed removal of a further 60 employees until the consultation process is finalised;
• not take any steps towards the termination of employees;
• provide the CPSU with details as required under s.668 of the Act; and
• meet with the CPSU for genuine consultations as required under s.668 of the Act.

Comments
The matter above helps to illustrate that when implementing redundancies:

• the selection process by which employees are selected must be transparent and non-discriminatory;
• the implementation process must be handled with sensitivity;
• the reasons given for making an employee’s position redundant must be genuine;
• an employer must be able to show that the selection criteria used to determine which employees’ positions were to be made redundant were fair and objective and that individual circumstances were taken into account; and
• all obligations imposed by legislation and industrial instruments must be adhered to.

If either the selection criteria or the implementation process used is flawed, an employer may be exposed to claims by employees for unfair dismissal, unlawful termination and/or unlawful discrimination.

If you would like advice or assistance with implementing redundancies, including information on the new redundancy provisions contained in the Fair Work Act 2009 (Cth), please contact Workplace Law on 9256 7500.

AIRC to Make Modern Restaurant and Café Award
Workplace Relations Minister Julia Gillard has directed the President of the Australian Industrial Relations Commission (the AIRC), Justice Geoffrey Giudice, to create a separate modern award for the restaurant, café and catering industry.  This is to ensure that the modern award will contain appropriate penalty and overtime rates.

The industry was to be included in the modernized hospitality award however, after objections raised by employers in the industry Minster Gillard stated that the “…common concern was the potential for the modern award to impact upon the continuing viability of restaurant and café businesses which operate in an industry characterized by low profit margins and peak operating times of evenings and weekends.”

Modernised awards are due to commence on 1 January 2010.  A list of modernised awards is available by checking the AIRC’s website, www.airc.com.au.  For more information on modernised awards and how they may affect your business, please contact Workplace Law. 

EMPLOYMENT
Australian Taxation Office Releases New Ordinary Time Earnings Ruling
In May 2009 the Australian Taxation Office (ATO) released its new Ordinary Time Earnings Ruling which clarifies the meaning of “ordinary time earnings” and “salary or wages” for Superannuation Guarantee purposes.  The Ruling - SGR 2009/2 - will take effect from 1 July 2009.

In accordance with the Superannuation Guarantee (Administration) Act 1992 Cth:

• an employer’s obligation to make superannuation guarantee contributions for an employee is based on the employee’s ordinary time earnings (OTE) for the quarter; and
• the superannuation guarantee charge imposed on an employer if it fails to make sufficient contributions is based on the employee’s salary or wages for the quarter.

The main points under SGR 2009/2 are:

• “salary or wages” is a broader concept than OTE;
• an amount can only be part of an employee’s OTE if it is “salary or wages” of the employee;
• “salary or wages” may include amounts that are not OTE;
• overtime is excluded from OTE and the notion of “regular overtime” has been discarded.  An employee’s “ordinary hours of work” are the hours specified as his or her ordinary hours of work under the relevant award or agreement that governs the employee’s conditions of employment;
• while certain types of bonuses have always been considered to be included in OTE - particularly performance related bonuses – Christmas bonuses are now included, and bonuses labelled as “ex-gratia” but are actually in respect of ordinary hours of work are also included;
• payments in lieu of notice are included in OTE;
• parental leave payments are not dealt with; an
• benefits under employee share schemes are not included in OTE.

Appendix 1 of SGR 2009/2 includes a table which identifies some of the types of payments which are included, or excluded, from OTE.  Each of the examples provided in the table is discussed in detail in the body of SGR 2009/2).

SGR 2009/2 also sets out a number of examples of amounts received and whether each amount qualifies as “salary or wages” and OTE.

A copy of SGR 2009/2 can be accessed and downloaded from the ATO website at www.ato.gov.au

Comments
Employers will need to review their existing employment arrangements to determine whether any additional superannuation contributions will be required to be made from 1 July 2009.

Use of Blackberries Outside Work Hours Could Lead to Overtime Claims
As reported in previous e-updates, the use of Blackberry devices and other “smart phones” is rising dramatically. 

In a recent article, a lawyer from a San Diego law firm stated that employers should be careful to whom they provide Blackberries and other such devices.  The lawyer, Mr Danzig, commented that employers should only consider providing Blackberries and other such devices to employees who are not entitled to claim overtime.

As stated in our previous e-updates, the increased use of Blackberries and similar devices means that users are constantly connected to their work emails and therefore, can check work related emails at any time of the day or night.  While this may sound like heaven to employers, beware!  The sending of an email to an employee outside traditional work hours or after the employee has left for the day could lead to an overtime claim for checking the email on the employee’s way home from work!

Employers should consider their policies on the use of mobile phones, and consider amending them to take into account the use of Blackberries and similar devices.  For assistance with updating your mobile phone policy to cover the use of such devices and defining when the use of such devices is “work related” or “personal”, please contact Workplace Law. 

Two Unfair Dismissal Cases for Toyota Motor Corporation Australia
Toyota Motor Corporation Australia Limited (Toyota) recently had two unfair dismissal cases before the Australian Industrial Relations Commission (AIRC) both with very different outcomes.

In the first case, Mr John Sattout v Toyota Motor Corporation Australia Limited [2009] AIRC 412 (15 May 2009) (Sattout’s case) Mr Sattout was summarily dismissed after being involved in two incidents with a co-worker, both off the premises after his shift had finished.  Mr Sattout had been employed with Toyota for 14 years with no disciplinary or performance issues. 

In the first incident, Mr Sattout had finished his shift and was driving away from the workplace.  As he was driving away, the co-worker came up behind him, cut him off and then reversed his car towards Mr Sattout.  Mr Sattout stopped his vehicle, alighted and the co-worker assaulted Mr Sattout, causing facial and head injuries.  Another co-worker broke up the fight and Mr Sattout continued on his way.  After leaving the scene, the co-worker waited again for Mr Sattout and cut him off with his vehicle once again.  Mr Sattout asked the co-worker if they could solve the problem however, the co-worker initiated another assaulted which was again broken up by another co-worker. 

Mr Sattout was dismissed for fighting, which was against Toyota’s “Hands Off and Physical Violence in the Workplace” policy.  A witness stated that they had seen Mr Sattout punched or attempted to punch the co-worker during the second incident.

Commissioner Lewin said that there was no “…valid reason for the termination” and it was “…harsh, unjust and unreasonable.”  Commissioner Lewin stated that even if Mr Sattout had punched or attempted to punch the co-worker, which he did not believe to be the case, it would have constituted legitimate self defence against the co-worker.

Mr Sattout sought reinstatement, payment for lost remuneration and continuity of service.  Based on the size of Toyota, Commissioner Lewin did not believe that the orders sought would affect the viability of Toyota and so Mr Sattout was reinstated, received payment of lost remuneration and continuity of service.

The second case also related to Toyota’s “Hands Off and Physical Violence in the Workplace” policy.  In Damien Kleidon v Toyota Motor Corporation Australia Limited [2009] AIRC 419 (22 April 2009), Mr Kleidon hit a female fellow employee on the bottom with a stick and as a result of breaching the policy, his employment was terminated.

Mr Kleidon commenced unfair dismissal proceedings stating that the incident was “horseplay” and that he had “tapped” her with the stick on the thigh.  At the time of the incident, Mr Kleidon had been employed by Toyota for 12 years. 

Mr Kleidon had worked with the female co-worker for three to four months and stated that there was often physical contact between them, including bumping and punching.  Mr Kleidon stated that he wanted his co-worker to feel “part of the team”.  Witnesses stated that the female co-worker did not scream or complain following the incident however, the team leader acknowledged that the co-worker said in a meeting the next day “…Damien hit me with a stick and it stung like all s*#t.” 

After making the formal complaint, the female co-worker was made to feel bad by others in the workplace and took time off work due to stress.  Eventually she left Toyota when she was required to return to the day shift and work with Mr Kleidon’s friends.

Commissioner Deegan found that Mr Kleidon did strike the female co-worker on her bottom with a piece of wood and that the action “…was deliberate and clearly in breach of the respondent’s “hand-off” policy.”  Commissioner Deegan concluded that the termination of Mr Kleidon’s employment was not harsh, unjust or unreasonable and that Toyota had a valid reason to terminate the employment

Comments
These cases demonstrate how important it is to ensure that termination is for a valid reason and the importance of policy in a workplace for regulating the working relationship. 

For more information or advice on termination of employment, please contact Workplace Law. 

DISCRIMINATION / HARASSMENT
Employer Did Not Know HR Manager Was Pregnant
A Human Resources Manager’s claim that she was discriminated against in the area of employment - contrary to sections 10 and 11 of the Equal Opportunity Act 1984 (WA) (the EO Act) - has failed in the Western Australian State Administrative Tribunal (the Tribunal).

Section 10 of the EO Act relevantly states:
(1) a person (the discriminator) discriminates against another person (the aggrieved person) on the ground of the pregnancy of the aggrieved person if:
(a) on the ground of:
(i)  the pregnancy of the aggrieved person;
(ii) a characteristic that appertains generally to persons who are pregnant; or
(iii) a characteristic that is generally imputed to persons who are pregnant,
the discriminator treats the aggrieved person less favourably than, in circumstances that are the same or are not materially different, the discriminator treats or would treat a person who was not pregnant; and
(b) the less favourable treatment is not reasonable in the circumstances.

Section 11 of the EO Act relevantly states:
(1) It is unlawful for an employer to discriminate against a person on the ground of the person’s sex, marital status or pregnancy:
(a) in the arrangements made for the purpose of determining who should be offered employment;
(b) in determining who should be offered employment; or
(c) in the terms or conditions on which employment is offered.

The HR Manager claimed she was offered permanent employment, subject to a medical assessment and referee checks and when the results of the medical test came back advising that she was pregnant, the company terminated her and gave the position to another person.

The company rejected the employee’s allegations.  It claimed that the HR Manager was offered casual employment pending recruitment for the permanent position.  The company added that during the recruitment process it underwent restructure, which resulted in a new HR position requiring a more experienced candidate.  Additionally, the HR Manager’s pregnancy had no bearing as no-one who made any decision in relation to her employment knew she was pregnant until after the decision to restructure was made.

The Tribunal accepted both arguments made by the company and concluded that the HR Manager could not provide any evidence of knowledge on the part of anyone making a decision about her employment.

See: Engstrom v Fortescue Metals Group Ltd [2008] WASAT 314

Union Discrimination Case Fails
The Community and Public Sector Union (the CPSU) has failed in its discrimination case against the Department of Health and Ageing (the Department).  In CPSU & Anor v Commonwealth of Australia [2009] FMCA 488 (29 May 2009), the CPSU alleged that the Department discriminated against a union delegate by transferring her to another position within the Department.

The female union delegate was transferred to another position and the CPSU applied to the Federal Magistrates Court for a finding that the Department had injured its Health and Ageing section secretary in her employment, and altered her position when she was transferred.  The CPSU alleged that the reason for the transfer was due to her union role, which is prohibited under section 793 of the Workplace Relations Act 1996 (Cth) (the WR Act).

Federal Magistrate Smith stated in his ruling that the Department did not transfer the union delegate for a prohibited reason, or for reasons including a prohibited reason, i.e., due to her role as a union delegate.

Federal Magistrate Smith stated that as a result of budgetary pressure and a shift in policy direction under the current Rudd Government, the Department had no choice but to restructure the union delegate’s role and that the union delegate had not been discriminated against. 

JOKE OF THE MONTH
CV Bloopers
These are taken from real resumes and cover letters:

1. I demand a salary commiserate with my extensive experience
2. I have lurnt Word Perfect 6.0 computor and spreadsheet progroms
3. Received a plague for Salesperson of the Year
4. Wholly responsible for two (2) failed financial institutions.
5. Am a perfectionist and rarely if if ever forget details.
6. I have an excellent track record, although I am not a horse.
7. Note:  Please don't miscontrue my 14 jobs as job-hopping. I have never quit a job
8. Reason for leaving last job:  They insisted that all employees get to work by 8:45 a.m. every morning. Could not work under those conditions
9. Finished eighth in my class of ten
10. References:  None. I've left a path of destruction behind me