Alternative job offer: loss of seniority not acceptable


Alternative job offer: loss of seniority not acceptable

A general manager who was offered a position with less executive status and seniority was entitled to a redundancy payment, as it was not acceptable alternative employment.


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A general manager who was offered a position with less executive status and seniority was entitled to redundancy pay, as the job was not acceptable alternative employment.
These three cases determine if acceptable alternative employment was offered to redundant employees.

Loss of seniority meant alternative employment not acceptable

The relevant test for determining whether an alternative position was acceptable to the employee did not rely upon the employee’s subjective response to the offer. The test is an objective one and no regard is paid to the reasonable expectation that an employee would seek to minimise the hardship which may arise from threatened redundancy.

Derole’s case (1990) 140 IR 123; [1990] AIRC 980 established this principle. The full bench in that case ruled employees should minimise the hardship of redundancy by accepting alternative employment found by their employer (where it is found to have been “acceptable” alternative work by the Commission) and the employees’ subjective views about the alternative employment were to be given no weight.

In this case the commission found the alternative position offered was not acceptable as the employee would have less executive status and seniority. Mr S was the general manager for the business in Australia and reported only to the chief operating officer in Switzerland prior to the acquisition. In the new position he would report to the general manager Asia-Pacific and the position would not require the same skills, duties, seniority or status as he enjoyed as a general manager.

Such matters as seniority and status may not be as significant in other positions of a more operational kind.

Re Datamars (Australia) P/L t/a Datamars [2015] FWC 1269 - Richards SDP - 27 February 2015 

Employer was a 'force' to be reckoned with

What constitutes other acceptable employment was considered by a full bench of the then Australian Industrial Relations Commission in Tontine Fibres & National Union of Workers – Mooroolbark Site Enterprise Partnership Agreement 2005

It concluded: “It is well established, and common ground in the appeal, that the concept of acceptable alternative employment is to be determined objectively.”

The commission concluded the intention was not to impose an absolute test on the employer’s ability to “obtain” alternative employment; rather it refers to action which causes acceptable alternative employment to become available to the redundant employee.

The employer must be a strong, moving force towards the creation of the available opportunity.

In this case the employer was such a force and the commission was satisfied the applicant should be relieved of any obligation to make a redundancy payment.

Claytons (Aust) P/L v Galea [2015] FWC 313 - Gregory C - 3 March 2015 

 Change of location and travel issues – not acceptable alternative employment

A FWC full bench found that an alternative employment offer was not acceptable due to the change of location and the travel difficulties that posed for the employee.

The full bench also took into account the lateness of the offer to transfer Mrs P.

Appeal by Australian Commercial Catering P/L against decisions and order of Roe C of 10 April 2014 [[2014] FWC 2432and[2014] FWC 2431] Re: Powell and Anor [2015] FWCFB 87 - O’Callaghan SDP Gooley DP Blair C - 6 March 2015

The bottom line: Facts must be carefully marshalled when arguing that certain alternative employment is suitable alternative employment.

See also: Redeployment – was job offer reasonable? 

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