The Federal Court recently fined the Royal Melbourne Institute
of Technology (RMIT) $37,000 and ordered it to reinstate an
academic for using a sham redundancy to "get rid of an
The university claimed it had made the academic redundant for
financial reasons, as her area was running at a loss, however
Justice Peter Gray found RMIT took unlawful adverse action when it
dismissed the academic after she had fallen out with her head of
NEED FOR DETERRENCE
In setting the penalties, Justice Gray noted that RMIT,
particularly the Vice-Chancellor, had displayed no contrition. He
commented that, "unless the effect of a penalty is felt, RMIT
might again succumb to the temptation to make use of its redundancy
processes to rid itself of an employee".
He added, "Employers must understand that making use of
redundancy as a pretext for getting rid of an undesired employee is
not an option."
In finding RMIT breached s 340(1)(a)(ii) of the Fair Work Act,
Justice Gray held the university had failed to prove that the
reasons for the academic's dismissal did not include those
alleged by the NTEU - that she had exercised, or planned to
exercise, workplace rights, including making bullying and
intimidation complaints against her new head of school to various
people within RMIT and to WorkSafe Victoria.
He said his finding was also based on the absence of "any
clear expression of a connection between the financial deficit in
the Youth Work discipline and the choice of [the academic] as the
one who should be made redundant".
"This includes the absence of the expression, or the
application, of any criteria by reference to which the making of
that choice occurred."
Justice Gray said that the Vice-Chancellor failed to give
explicit evidence that none of the reasons the NTEU alleged were
behind the sacking "was operative in her decision", and
had in fact indicated that she had "reasons other than those
to which she referred explicitly".
Further, he said he was influenced by the Vice-Chancellor's
determination to "ignore her knowledge" of [the new head
of school's] animosity towards the academic.
DOUBLE PENALTY ORDERED
Justice Gray found that RMIT had breached its enterprise
agreement with the NTEU by failing to provide the academic with the
option of participating in a voluntary redeployment process.
He penalised RMIT $27,000 for contravening the Fair Work Act and
$17,000 for breaching its enterprise agreement. However Justice
Gray reduced the total fine from $44,000 to $37,000 because there
was some overlap between the two.
He ordered RMIT to pay the penalty to the NTEU, saying "the
scheme under which the enforcing party is the recipient of the
penalty is designed to encourage the enforcement of provisions of
the Fair Work Act and of agreements and other instruments made
Justice Gray ordered the academic to be reinstated to the
position she held immediately before her dismissal took effect,
which would see her working in a separate building to the head of
school and not directly reporting to him.
WHAT DOES IT MEAN FOR EMPLOYERS?
This case raises serious questions about an employer's
responsibility to ensure an employee's dismissal is a
'genuine redundancy', particularly in instances where the
individual selected for redundancy can demonstrate that other
factors (such as complaints made by the individual) might be
motivating the redundancy decision.
If you are considering terminating an employee, please contact
us to discuss how ClarkeKann can provide advice and assistance in
meeting your employment obligations.
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guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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