Tas roadworkers win option of voluntary redundancy

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Tas roadworkers win option of voluntary redundancy

Tasmanian road workers affected by the sale of the Civil Construction Services Corporation have won the right to chose voluntary redundancy over employment with the purchaser Works Infrastructure.

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10/03

 

Tasmanian road workers affected by the sale of the Civil Construction Services Corporation have won the right to chose voluntary redundancy over employment with the purchaser Works Infrastructure.

The AIRC’s Vice-President Ross agreed to vary the CCC’s enterprise agreement to read that in the event of a sale an employee might 'elect to become redundant, in which case such an election shall be deemed to be an involuntary redundancy'.

Background

The CFMEU, AWU and the Civil Construction Services Corporation applied under s170MD(6) of the Workplace Relations Act to vary clause 9.5 of the CCC agreement with the aim of removing ambiguity regarding the payment of voluntary redundancy provisions.

It was generally agreed that the CCC agreement was negotiated in an environment of uncertainty about the future of the corporation. The North East and North West road maintenance contracts, to which CCC was a party,were due to be re-tendered. These maintenance contracts were a substantial part of CCC’s business. In these circumstances the employees were concerned about the security of their entitlements if CCC were sold. Three months after the agreement was certified, the State Government announced its intention to sell the CCC.

Clause 9.5 of the agreement dealt with the rights and obligations of the parties in the event that CCC was sold. It said that following a sale an employee whose position with CCC no longer existed might elect to take up another position on the same terms and conditions or become redundant, in which case the employee was entitled to the rights and benefits outlined in the enterprise agreement.

The AWU and CFMEU lodged s99 notifications regarding disputes over the interpretation of clause 9.5. The essence of the dispute was whether clause 9.5 provided CCC employees with the option of either accepting employment with the purchaser of the business or choosing to be made redundant. The unions contended that employees were entitled to the redundancy payments set out in clause 23 of the agreement. CCC argued that clause 23 only applied in cases of involuntary redundancy and hence had no application where an employee chose to be made redundant.

Consequently, the corporation contended, an employee who chose to be made redundant was only entitled to their accumulated annual and long service leave.

Findings

Vice-President Ross found the mutual intent of the parties at the time the agreement was made was that if an employee elected to be made redundant under clause 9.5 then they were entitled to the redundancy payments set out in clause 23. He said that while he accepted that the issue was not the subject of any detailed discussion at the EBA Negotiating Committee meetings, the evidence clearly established that both management and employee representatives were of the same mind in respect of the application of clause 23.

'The matter did not need to be articulated because, consistent with the corporation's past practice, it was assumed that the employee entitlements in respect of voluntary and involuntary redundancies would be the same.'

The Vice-President said he was satisfied that clause 9.5 of the agreement was ambiguous and uncertain and that he should exercise his discretion under s170MD(6) to remove the ambiguity by varying clause 9.5 in the manner proposed by the AWU and CFMEU. He said this would reflect the mutual intention of the parties at the time the agreement was made and be consistent with the information given by corporation representatives to CCC employees about how clause 9.5 would operate in practice.

He said he acknowledged CCC’s argument that the offer made to all employees by the purchaser, Works Infrastructure, would constitute acceptable alternative employment in the context of the relevant test case standard.

'While that is relevant to the exercise of my discretion, it is not determinative. It has to be weighed against the mutual intent of the parties and the information provided to the CCC employees.'

Vice-President Ross went on to say that as a matter of general industrial principle there was considerable force to CCC’s argument. 'If an employee is offered acceptable alternative employment they are not entitled to paid redundancy pay.

'However, I am not dealing with this matter in the abstract. I am dealing with it in the context of s170MD(6) and in my view I am obliged to give considerable weight to the mutual intention of the parties at the time the agreement was made.'

The Vice-President agreed to vary clause 9.5 to read that in the event of a sale an employee may elect 'to become redundant, in which case such an election shall be deemed to be an involuntary redundancy for the purposes of clause 23 of this certified agreement'.

See: The Australian Workers' Union, Construction, Forestry, Mining and Energy Union and Civil Construction Services Corporation t/as Civil ConstructionCorporation, AIRC PR939346, (13 October 2003).

 

 

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