VIC Employer Dodging Redundancy Clause?

[Des Purdey]

Hello
Our employer (Local Government) has decided to put our IT Dept out to tender. They have told us that written into the contract with the tender winner will be a clause that we will be employed by that company with our pay and entitlements recognized and guaranteed for 12 months. We rejected that offer and requested redundancy but it was refused.
I believe they are relying on the "transmission" clause to avoid redundancy payments. Here is the clause they are quoting...
15. TRANSMISSION OF BUSINESS
15.1 In this Clause “business” includes trade, process, business or occupation and includes
part of any such business and “transmission” includes transfer, conveyance,
assignment or succession whether by agreement or by operation of law, and
“transmitted” has a corresponding meaning.
15.2 Where positions have been declared redundant as a consequence of transmitting the
business to an external provider, the redeployment procedure prescribed in this
Agreement will apply, and all reasonable steps will be taken to find suitable alternative
employment within Council.
15.3 At the end of the redeployment process for employees who have not been transmitted,
if no suitable offer of redeployment at the same level was available to the employee
and/or no voluntary redeployment occurred, the employee will be eligible for a
separation package in accordance with the redundancy provisions of this Agreement
and payment of all other accumulated leave entitlements.

The way I read 15.3 is that if I refuse to accept voluntary redeployment then I qualify for a redundancy.
Am I correct or just optimistic?

 

[Ivy]

Hi there,

Which State are you in? Local governments generally aren't covered by the Fair Work Act (which I'm most familiar with) so I need to have a look at the transfer of business laws on redundancy in your State.

 

[Des Purdey]

Victoria

 

[Ivy]

Okay, it looks though you are probably covered by the Federal laws: The Fair Work system - Fair Work Ombudsman

Firstly, are you sure that you would qualify for redundancy anyway, for example have you been employed by the Council for at least 12 months and were you an ongoing employee or a contract employee? Have a look at our blog post on redundancy for more information: Redundancy: A Quick Guide for Employees - LawAnswers.com.au Blog

Secondly, Fair Work Australia explains the circumstances under which redundancy pay is payable when there is a transfer of business.
Pay particular attention to the following:
"...an employee is not entitled to redundancy pay under the NES in relation to the termination of his or her employment with the old employer if:

• the employee rejects an offer of employment made by another employer that:
  • is on terms and conditions substantially similar to, and, on an overall basis, no less favourable than the employee’s terms and conditions of employment with the old employer immediately before the termination
  • recognises the employee’s service with the old employer for the purposes of redundancy pay
• had the employee accepted the offer, there would have been a transfer of employment."

Notice of termination and redundancy pay - Fact sheets - Fair Work Ombudsman

 

[Des Purdey]

Okay, it looks though you are probably covered by the Federal laws: The Fair Work system - Fair Work Ombudsman

Firstly, are you sure that you would qualify for redundancy anyway, for example have you been employed by the Council for at least 12 months and were you an ongoing employee or a contract employee? Have a look at our blog post on redundancy for more information: Redundancy: A Quick Guide for Employees - LawAnswers.com.au Blog

Secondly, Fair Work Australia explains the circumstances under which redundancy pay is payable when there is a transfer of business.
Pay particular attention to the following:
"...an employee is not entitled to redundancy pay under the NES in relation to the termination of his or her employment with the old employer if:

• the employee rejects an offer of employment made by another employer that:
  • is on terms and conditions substantially similar to, and, on an overall basis, no less favourable than the employee’s terms and conditions of employment with the old employer immediately before the termination
  • recognises the employee’s service with the old employer for the purposes of redundancy pay
• had the employee accepted the offer, there would have been a transfer of employment."

Notice of termination and redundancy pay - Fact sheets - Fair Work Ombudsman

Hello Ivy
Thanks for your reply, although it was not what I wanted hear.
Yes I do qualify for redundancy, employed at this place for 35 years.
The proposal put to us so far is that....
Period of service is recognised (although for future redundancy was never mentioned)
Annual Leave, Sick Lave and Long Service Leave. Our pay scale would only be maintained for 12 months, we know what the potential Contractors pay so we would potentially drop 30k per year after that first 12 months.

 

[Des Purdey]

Hi Ivy
Additionally,
My Super is a Defined Benefits scheme so I don't know how that will be impacted.

We believe that a redundancy costing process was carried out earlier in the year so it appears that this is a way to get rid of us and avoid paying us out.

 

[Ivy]

Hi Des,
I personally don't have any more suggestions for you on this issue. Maybe someone else on here can chip in. If you're concerned, I suggest that you give Fair Work Australia a call and see if they can provide any advice.
Alternatively, you can contact your relevant union.

 

[Des Purdey]

Cheers Ivy
I appreciate your input.

I have notified the union so we'll see what they say. I forgot to mention that our IT Dept has approx. 14 staff and in this exercise they have chosen just 3 of us to "farm out", that's what makes me think that the "transmission" clause is not being used in the spirit that it was created for.
Thanks again for your input.
Regards
Des

 

[Rod]

A defined benefits scheme is VERY valuable.

Do not lose access to this scheme unless you get a very generous package, better than what you have now. If the new employer does not offer this scheme, and I can't see how they would be able to offer it, take a redundancy and then say you will join on new conditions.