Scathing criticism of law firm's treatment of redundant employee

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Scathing criticism of law firm's treatment of redundant employee

Deputy President Sams of the NSW Industrial Relations Commission has found language used by a senior partner in a law firm to be ‘grossly offensive and completely unacceptable'.

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9/03

 

Deputy President Sams of the NSW Industrial Relations Commission has found language used by a senior partner in a law firm to be ‘grossly offensive and completely unacceptable'.

The Deputy President made these remarks in awarding 20 weeks’ compensation, $19,660, to a legal secretary who was made redundant. The law firm was found to have unfairly dismissed the employee and payment of severance pay did not mean that compensation for unfair dismissal was unavailable.

There was a failure to consult, a failure to give notice, a failure to discuss alternative employment options, little or no regard for the employee's age and workers' compensation injury or for her length of service and loyalty or her difficulties in finding alternative employment.

The Deputy President also found that the employee's impressive employment history was disregarded. Her work performance was never a consideration in the dismissal.

The unacceptable language used was indicative of the poor treatment received by the employee:

‘In cross-examination, Mr Meadows did not deny calling the applicant a "f-ing slag" and a "f-ing mole." He said he used these words "with people I have a strict work or professional relationship with."’

Background

The applicant, Ms Toni Neal was a 56-year-old woman with an impressive employment history. During the 1970's Ms Neal worked in England as private secretary to Lord Denning and Lord Wilberforce. From 1978 to 1979 she was private secretary to the Indonesian Consul General in Sydney and from 1982 to 1995 she worked as a legal secretary for the partners of several large, well known Sydney law firms. From 1995 she worked for Solicitor, Mr Geoffrey Meadows.

Ms Neal and three other employees were dismissed on 30 January 2003 following a review undertaken by the firm's chief executive, Mr Geoffrey Solomon and consequent restructure of the business.

The Deputy President noted:

‘A week before her birthday, Mr Solomon had called out to Ms Neal in the presence of other staff: "You can now retire, you'll be fifty five next week." She had felt very hurt and anguished by this comment.

At about 5:00pm on 30 January 2003 Mr Meadows together with Mr Warwick Hart (another director), informed Ms Neal she was to be made redundant. She said she was stunned and upset. When Mr Hart started to say something, she raised her hand and told him to be quiet.

She was handed a retrenchment letter, payslip and cheque. While Mr Meadows kept talking, she repeated three times 'what price loyalty?' Mr Meadows ignored the comment. She said she then asked to be excused to contact her lawyer. Mr Meadows said 'we want you to leave now.' She cleaned out her desk, collected her property and left. When she arrived home she claims to have broken down and cried for the loss of her best friend and the job she loved. She believed she had been betrayed.

On termination the applicant received five weeks pay in lieu of notice ($4,915), 20 weeks severance pay ($19,660) and an ex gratia payment of $424.00 taking the total to $25,000. The notice and severance pay was in accordance with the Clerical and Administrative Employees Legal Industry (State) Award 312 IG 703 and the Employment Protection Act 1982.

Decision

Deputy President Sams found in favour of Ms Neal:

’It seems to me that this matter can be conclusively determined by direct reference to the admissions in evidence of the respondent's witnesses. During the cross examination of Mr Meadows and Mr Solomon it was conceded that the applicant was not consulted or given any notice of her redundancy.

'That being so, it is axiomatic that there would have been no discussion with the applicant of alternative employment, or other options such as working part-time or retraining. It was accepted that no calls for voluntary redundancies were made. Moreover, there appeared to be little, or no account taken of the applicant's long period of loyal service with Mr Meadows.

'Further the applicant was not informed as to why she was selected for redundancy in preference to others and obviously had no opportunity to put her case in support of being retained. Even more alarming, when the applicant was told by Mr Meadows in December 2002 of the firm's restructure, he deliberately did not tell her that he and Mr Solomon already regarded her as a candidate for redundancy.

...

'In my opinion, the interview process was appallingly handled. The applicant was informed of her redundancy at 5:00pm, after other employees had left the office. This time was chosen so as to avoid disrupting other staff. Clearly the applicant was denied an opportunity to farewell her colleagues. Mr Meadows said she could have phoned the next day. This was a disingenuous and insensitive remark.

...

'Accordingly, I take no account of the respondent's allegations of poor work performance or lack of co-operation and, in any event, I seriously doubt whether there was any legitimate basis for such claims.

'The Commission would observe that it is not strictly necessary to determine whether the applicant's position was genuinely redundant. This is so because I regard the process of the applicant's termination of employment as being harsh and unjust. This finding is based on the well accepted authorities which have dealt with the principles relevant to unfairness in redundancy situations. In this regard, I refer to what I said in 'Shop, Distributive and Allied Employees' Association, New South Wales and W D & H O Wills Holdings Ltd':

Guidance on redundancy situations

"A body of well settled contemporary industrial principles has developed from these, and many other, authorities. They may be summarised as follows. In redundancy situations an employer is obliged to:

1. give reasonable notice to employees and/or their Unions; 

2. adequately consult with employees and/or their Unions on the impact of the proposed changes;

3. explore genuine alternative options for redundancy, such as redeployment or relocation;

4. ensure such options are fairly offered to the affected employees;

5. provide reasonable standards of redundancy benefits;

6. provide appropriate ancillary services, such as time off to seek alternative work, retraining opportunities, outplacement services or financial planning;

7. ensure employees nominated for redundancy are fairly selected on an objective and unbiased basis.

"...Notwithstanding the employer's obligations, there are certain reciprocal obligations on employees when confronted with genuine efforts by the employer to minimise the impact of potential redundancy. These obligations include:

a) a willingness to participate in consultation with the employer;

b) genuinely participating in exploring alternatives to redundancy;

c) not unreasonably refusing to accept retraining, alternative employment, redeployment or relocation."

Conclusion

'Firstly, while there was some dispute as to whether the applicant and Mr Meadows were close friends, there can be no doubt that they enjoyed a close working relationship and friendship over seven and a half years. To be dismissed in such a perfunctory manner, without warning, must have come, not only as a complete shock to the applicant, but it must have deeply hurt and distressed her. I can well appreciate her sense of betrayal.

'Her repeated refrain during the termination meeting of "what price loyalty" was a perfectly understandable reaction. In these circumstances, it seems reasonable to assume, that it was unlikely she heard anything about offers of out placement assistance during the meeting. In any event, the respondent made no attempt to follow up this offer at some later point when the applicant presumably would have had time to calm down.

'Secondly, the applicant is 56-years-old and has made numerous attempts to find alternative work. With due respect, I can well appreciate why she has had difficulty finding new employment.

'For the reasons herein expressed, the Commission finds that the dismissal of the applicant on 30 January 2003 was harsh and unjust within the meaning of Pt 6 ch 2 of the Act.'

Appropriate relief

'...the amounts paid as redundancy reflect no more that the minimum standards for redundancy under the terms of the Award as determined by a test case of this Commission; see 'Re Redundancy Awards (1994) 53 IR 419'.

'...Putting aside whether the applicant's position no longer exists, reinstatement was not pressed by the applicant. The applicant's sense of betrayal was real and acute. Moreover, having regard for the past working relationship with Mr Meadows and the manner in which she was dismissed, I do not believe it would be in anyone's interest to restore the employment relationship.'

Inappropriate language

'There is one final matter that I feel bound to comment upon. Mr Meadows gave evidence that he did not deny referring to the applicant, and indeed others with whom he had a professional relationship by such expressions as "you f*king mole" and "you f*king slag." For my own part, I was appalled by this evidence.

'To speak to anyone in such terms, let alone to someone who might be regarded as a friend or colleague, was disgusting. It was grossly offensive and completely unacceptable. Moreover, for such language to be used in the workplace by a partner in a law firm with an industrial relations practice, I found to be almost beyond belief.’

The Commission awarded 20 weeks pay.

See: Neal and Shaw McDonald Pty Ltd and another [2003] NSWIRComm 298 - Sams DP - 22 September 2003.

 

 

 

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