APPEAL AGAINST A DECISION OF THE INDUSTRIAL MAGISTRATE IN MATTER NUMBER M 51/2021 GIVEN ON 19 JANUARY 2022

WESTERN AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION

FULL BENCH

CITATION : 2022 WAIRC 00631

DELIVERED : Monday, 22 August 2022

FILE NO. : FBA 1 OF 2022

Appellants

AND

Alan Mahon

Respondent

Catchwords : Industrial law (WA) - Appeal against the decision of the Industrial Magistrate - Whether the respondent was made redundant in accordance with the General Order of the Commission made under s 50 of the Industrial Relations Act 1979 - Relevant principles of interpretation of industrial instruments considered and applied - Whether open for appellants to raise point not argued at first instance on appeal - Relevant principles considered and applied - Alleged errors of fact and law - No error demonstrated - Appeal dismissed

Legislation : Fair Work Act 2009 (Cth) s119(1)(a)

Industrial Relations Act 1979 (WA) s 7, s 50, s 83

Industrial Relations Commission Regulations 2005 reg 102(3)

Partnership Act 1895 (WA) s 10 

Result : Appeal dismissed

Representation:

Counsel:

Appellants : Mr G McCorry as agent

Respondent : Mr P Mullally as agent

Case(s) referred to in reasons:

Alfresco Concepts Pty Ltd v Troy Patrick Franse [2015] WAIRC 00244; (2015) 95 WAIG 437

Atwell v Roberts [2013] WASCA 37; (2012) 43 WAR 507

Bampton v Viterra Limited [2015] SASCFC 87

Ex parte Merrett (1997) 140 FLR 412

Federal Commissioner of Taxation v Sahhar (1985) 59 ALR 98

Jones v Department of Energy and Minerals (1995) 60 IR 304

Quality Bakers Australia v Goulding (1995) 60 IR 327

R v Industrial Commission (SA); Ex parte Adelaide Milk Supply Co‑operative Ltd (1977) 16 SASR 6

Playfair Development Corp Pty Ltd v Ryan [1969] 2 NSWR 661

Sealanes (1985) Pty Ltd v John Francis Foley and John Anthony Bukterica [2006] WAIRC 04110; (2006) 86 WAIG 1239

SGS Australia v Taylor (1993) 73 WAIG 1760

Short v FW Hercus Pty Limited (1993) 40 FCR 511

The Australian Rail Tram and Bus Industry Union of Employees v Public Transport Authority of Western Australia [2017] WAIRC 00830; (2017) 97 WAIG 1689

Trades and Labour Council of Western Australia v Minister for Consumer and Employment Protection and Ors [2005] WAIRC 0134; (2005) 85 WAIG 1667

UGL Rail Services Pty Ltd v Janik [2014] NSWCA 436

Reasons for Decision

KENNER CC:

Background and proceedings at first instance

1         At the material times, the appellants were a partnership conducting a steel manufacturing business, manufacturing sheet metal products for the building industry. The appellant’s Chief Executive Officer, the respondent, Mr Mahon, had been in that position since June 2015. The business traded under the name ‘Combined Metal Industries’. It was a family business and Mr Darren Elsegood was the Managing Partner. His siblings were the other natural persons in the partnership.

2         In early 2020, the appellant’s business was in a difficult financial position. It had to reduce its costs. Reductions in salaries for employees were required. On 23 March 2020 a meeting took place between Mr Elsegood, Mr Douglas, a business associate and adviser to the appellants, and the respondent. The respondent was informed that due to the circumstances of the business, the appellants could not afford to keep him on his $250,000 remuneration package. The respondent was told that if he was not prepared to have his remuneration reduced, then his employment would have to be terminated. The respondent did not agree to a reduction in his remuneration.

3         After a short break, the meeting resumed. The respondent was informed that as he was not prepared to take a reduction in his remuneration, then his employment would be terminated for financial reasons. A letter was provided to the respondent on the same day, confirming the termination of his employment and his final entitlements.

4         Following the termination of the respondent’s employment, Mr Elsegood took over the responsibilities of managing the business, with assistance from Mr Douglas, in his capacity as an external consultant. This arrangement continued until about August 2021, when another CEO was appointed.

5         The respondent commenced a claim in the Industrial Magistrates Court, in the court’s general jurisdiction under s 83 of the Industrial Relations Act 1979 (WA), alleging that the appellant had contravened cl 4.4 of the Commission’s General Order in relation to termination, change and redundancy: [2005] WAIRC 01715; (2005) 85 WAIG 1681. There was no dispute that the General Order is an ‘entitlement’ provision as defined in s 7 of the Act. It was contended that the appellants had made the respondent redundant, as that term is defined in cl 4.1 of the General Order and failed to pay him severance pay as provided in cl 4.4, in the sum of $38,461.54. This was an agreed sum if liability was established.

6         It is convenient at this point to set out cl 4.1 of the General Order which is in the following terms:

4.1 …

Redundancy occurs where an employer has made a definite decision that the employer no longer wishes the job the employee has been doing done by anyone.

….

7         In her decision, Industrial Magistrate O’Donnell identified the issue for determination as:

…whether the termination of the Claimant’s employment can be properly regarded as redundancy in the sense that, on 23 March 2020 the Respondent had made a definite decision that it no longer wished the job the Claimant had been doing to be done by anyone.

(Reasons at [31] AB13)

8         The appellants at first instance contended that because the duties of the CEO of the business continued to be performed after the termination of the respondent’s employment, this meant that the appellants did wish the job the respondent had been performing, to be done by someone. Therefore, accordingly, the respondent was not made redundant and was not entitled to severance pay under cl 4.4 of the General Order.

9         The learned Industrial Magistrate considered the relevant law as to what constitutes redundancy. Her Honour considered well‑known common law cases such as Quality Bakers Australia v Goulding (1995) 60 IR 327; Sealanes (1985) Pty Ltd v John Francis Foley and John Anthony Bukterica [2006] WAIRC 04110; (2006) 86 WAIG 1239; and Jones v Department of Energy and Minerals (1995) 60 IR 304. After considering the authorities, her Honour then identified that the question arose as to whether the general principles to be derived from these cases, had application to the circumstances before her, where (as in cl 4.1 of the General Order) the meaning of ‘redundancy’ is defined, or whether a different result may arise (reasons at [38] AB14). 

10      In addressing that issue, the learned Industrial Magistrate had regard to the reasoning of the Full Court of the South Australian Supreme Court in Bampton v Viterra Limited [2015] SASCFC 87. In that case a manager responsible for port and country operations at a grain bulk handling operation in South Australia, had his responsibilities divided. He took over the country operations, and another position took over the ports.  There was no change to his remuneration, status, or hours of work etc.  He claimed he had been made redundant under a clause in a redundancy policy which applied to his employment.  The policy relevantly stated:

An Employee’s position is redundant where the Company has made a definite decision that it no longer requires the job an Employee has been doing done by anyone

…

11      The learned Industrial Magistrate considered this definition of redundancy to be in very similar terms to the definition in cl 4.1 of the General Order. Her Honour concluded, from an examination of that case, that the:

…text, context and evident purpose of that clause and the one under consideration in the case before me, is such that it is both useful and appropriate for me to have regard to the discussion in Bampton.

(Reasons at [41] AB14)

12      Her Honour had regard to the observations of Kourakis CJ in Bampton at [44], where his Honour rejected the employer’s argument in that case that the devolution of a longstanding employee’s responsibilities to other employees is not a redundancy, because the ‘job’ is still being performed by others. Kourakis CJ considered that such a construction of the clause in question ‘eviscerates the manifest purpose of Viterra’s redundancy provision’.

13      Adopting Kourakis CJ’s approach and having regard to the origins of the form of clause in the Viterra redundancy policy, as considered by Blue J (Vanstone J agreeing) in Bampton, and in reliance on Short v FW Hercus Pty Limited (1993) 40 FCR 511, her Honour rejected the appellants’ approach to the construction of cl 4.1 of the General Order. Her Honour concluded that demonstrating that component parts of a job are still being performed by other employees after the termination of an employee’s employment, was not sufficient to avoid severance pay obligations. What is important is whether there are any duties left for the employee [made redundant] to perform (Reasons at [50] AB16).

14      In concluding there is no exhaustive definition of redundancy as discussed by Ryan J in Jones, the learned Industrial Magistrate found that as of 23 March 2020, there was no longer any function or duties left to be performed by the respondent and the appellants:

…had decided that it (sic) no longer wished the job Mr Mahon had been doing done by anyone”. This is further supported by the fact that no person then held the position of CEO until August 2021.

(Reasons at [59] AB17)

15      On this basis, her Honour concluded that the termination of the employment of the respondent was by reason of redundancy as defined in cl 4.1 of the General Order and that the appellants had failed to pay the respondent severance pay as required by cl 4.4. The appellants were ordered to pay the respondent $38,461.54 plus pre‑judgment interest in the sum of $4,217.07.

16      The appellants now appeal to the Full Bench from the decision of the court under s 84 of the Act.

The appeal

17      The appellants challenge the learned Industrial Magistrate’s conclusion that the respondent was made redundant and seek to quash the decision and set aside the orders made. The grounds of appeal are in the following terms:

The learned industrial magistrate erred in fact and law in:

Failing to take into consideration that clause 4.1 of the General Order provides that a redundancy for the purposes of the General Order " ... . occurs where an employer has made a definite decision that the employer no longer wishes the job the employee has been doing done by anyone", when: -

(a) the undisputed evidence was that no such definite decision had been made by the Respondent and that the Respondent wished to keep the Claimant employed in the job he was performing; and

(b) the court actually and correctly found - at [48] - the Respondent wished to keep the Claimant employed in the job he was performing, albeit at a lower salary.

2) Wrongly applying the general principles of other cases to circumstances uniquely different, in that the other cases were distinguishable by the nature of the jobs made redundant in them, whereas Claimant was the Chief Executive Officer of the Respondent and that decision making role is one that cannot be made redundant except when a business ceases to be carried on and the decision making functions of that role are only then no longer required to be performed by anyone.

3) Wrongly finding - at [57] - that there was an irresistible inference to be drawn "that as at 23 March 2020 there was no longer any function or duty to be performed by Mr Mahon, and the Respondent had decided that it no longer wished the job Mr Mahon had been doing to be done by anyone" and that "this was further supported by the fact that no person then held the position of CEO until August 2021" when in fact and law:-

(a) the functions and duties were only no longer required to be performed by Mr Mahon after his employment had been terminated ;

(b) the evidence of Darren Elsegood and the court's own finding - at [26] - was that Mr Elsegood took over the role of CEO and the duties performed by the Claimant;

(c) it is not the title of the position or job that determines whether or not the functions or duties of the position have been made redundant but whether those functions and duties are not going to be performed by anyone in the future; and

(d) it does not follow as a matter of fact or law or permissible inference that if nobody held and used the title of CEO in the business (but still performed the role and all the functions of a CEO) the business did not have a CEO, there was no CEO role or functions required to be performed and that the job thus had been made redundant.

The contentions of the parties

The appellants

18      The appellants filed an outline of submissions that alleged errors of fact and errors of law made by the learned Industrial Magistrate. The written submissions did not specially identify and address each ground of appeal. Nonetheless, a summary of the appellants’ submissions is as follows.

19      The appellants referred to the learned Industrial Magistrate’s findings of fact that:

(a) there was no evidence that in March 2020 the Appellant was implementing a carefully planned overhaul or restructure of CMI,

(b) nonetheless, the difficult financial position the Appellant found itself in at that time lead to a reorganisation of sorts, and specifically to the termination of the Respondents employment when he declined to accept a reduction in pay,

(c) the Appellant terminated the Respondent’s employment because it could no longer afford his remuneration.

(d)  the Appellant offered to retain the Respondent in its employ and as it’s CEO on a lower salary,

(e) as at 23 March 2020 there was no longer any function or duty to be performed by the Respondent and the Appellant had decided that it no longer wished the job the Respondent had been doing to be done by anyone.

(f) no person then held the title of CEO until August 2021,

(g) after the termination of the Respondent’s employment the Appellant’s managing partner took over his duties with some assistance from an outside consultancy.

20      The appellants contended that the learned Industrial Magistrate made factual errors and that some of her factual findings were inconsistent. First, the appellants submitted that her findings as to par (b) and par (d) above, were inconsistent in that it was contended if the respondent had accepted the appellants’ proposal for a reduction in salary, he would have remained the CEO. This would not constitute a re‑organisation. Consequently, the termination of the respondent’s employment and the assumption of the respondent’s duties by Mr Elsegood also could not be a re‑organisation of any sort.

21      As to the findings in par (e) and par (g) above, the appellants submitted that they are inconsistent because if Mr Elsegood took over responsibility for the respondent’s position as the CEO, then it was not open to conclude that the appellants had decided that they no longer wished the job done by the respondent, to be done by anyone.

22      Furthermore, as to the finding by the learned Industrial Magistrate that no one had a title of CEO until August 2021, the submission was this was not relevant to whether the termination of the respondent’s employment was properly characterized as a redundancy.

23      Finally, it was contended that the learned Industrial Magistrate erred in fact in not finding that the position of CEO is one that cannot be made redundant. This was put on the basis that unless the business is wound up, such a position is always required, as the ultimate decision maker of a business entity.

24      As to errors of law, the appellants contended that the learned Industrial Magistrate erred in her reliance on Bampton and the cases cited therein, because it and those authorities applied to circumstances where redundancy obligations were not defined in any industrial instrument. The appellants contended that the meaning and effect of the terms of cl’s 4.1 and 4.4 of the General Order, are to be ascertained only from a consideration of the text of the General Order itself.

25      Adopting this approach, the appellants submitted that the plain language of cl 4.1 of the General Order, is inconsistent with the findings of the learned Industrial Magistrate and that the appellants wished to retain the services of the respondent, albeit at a reduced salary. The appellants further maintained that such a finding was inconsistent with the requirement that under cl 4.1 of the General Order, that the employer must have made a ‘definite decision’ that it no longer wished the job the employee had been doing, done by anyone.

26      Whilst the case was not referred to by the learned Industrial Magistrate in her reasons, the appellants contended that the decision of UGL Rail Services Pty Ltd v Janik [2014] NSWCA 436, which was cited in Bampton, is more apposite to the present circumstances. In that case, where a general manager was dismissed, and another person was appointed to take over the general manager’s functions, the Court of Appeal of New South Wales held that the general manager was not made redundant. The appellants submitted that the reasoning adopted in that case, should have been found to have applied to the situation of the dismissal of the respondent.

The respondent

27      In his submissions, the respondent referred to the origins of the redundancy provisions in the General Order, beginning with the Termination Change and Redundancy cases heard by the former Australian Conciliation and Arbitration Commission in 1984: (1984) 8 IR 34; (1984) 9 IR 115. The respondent also referred to the terms of the National Employment Standards in the Fair Work Act 2009 (Cth), in s 119(1)(a), which are in almost identical terms to the General Order provisions. In general, the respondent submitted that the cases dealing with redundancy contemplate the circumstance of a downturn in business, which occurred on the facts of the instant case. The respondent submitted that the appellants made a financial decision that they could no longer afford to pay the respondent at his rate of salary, and this led to the termination of his employment.

28      On the facts, the respondent contended that the ‘restructure’ involved the work the respondent formerly performed, being performed by Mr Elsegood, assisted by an external consultant, such that the former CEO position was no longer required. Approached differently, the respondent contended that after the change was put in place by the appellants, the respondent had no duties to perform, and his employment was terminated on the grounds of redundancy.

29      Specifically, as to ground 1, the respondent submitted that the evidence before the court, and the finding made by the learned Industrial Magistrate, was that the respondent was dismissed on 23 March 2020 because the appellants could no longer afford to pay his remuneration. The alternative of a reduction in his salary, was not agreed. The respondent submitted this situation was made clear by the letter given to the respondent from Mr Elsegood, dated 23 March 2020, after the meeting on the same day. This letter (AB60), formal parts omitted, provided as follows:

Further to our meeting earlier today, we now write to confirm the following:

• Your employment has been terminated effective 23rd March 2020

• Your employment was terminated on the following grounds:

      The business is unable to afford your remuneration.

      You were offered the opportunity to accept a lower wage however you refused that offer.

• Having perused your employment contract. we can confirm that your entitlements will be paid to you in accordance with the contract and any relevant statutory requirements.

• We will seek a Full and Final release document from you once both parties have mutually agreed the quantum amount and our Salaries and Wages Clerk has calculated your final Remuneration so as to avoid any confusion going forward.

30      The respondent submitted that the appellants’ assertion of error, by the learned Industrial Magistrate, in not finding there had been no definite decision by the appellants that they did not want the respondent’s job done by anyone, in reliance on [48] of her Honour’s reasons, was misguided. This was because, the finding at [48] by the learned Industrial Magistrate was that despite being willing to pay the respondent less to retain him in employment, did not mean his refusal to accept this proposal and his subsequent dismissal was not a redundancy. It was submitted that this finding and the dismissal of the respondent on this basis, was entirely consistent with the definition of redundancy in cl 4.1 of the General Order and supported the orders made at first instance.

31      As to ground 2, the respondent made several submissions.  First, it was put that the ground failed to comply with reg 102(3) of the Industrial Relations Commission Regulations 2005, in that it does not provide particulars as to why the learned Industrial Magistrate’s conclusion was wrong in law. Second, there is no authority or principle referred to by the appellants as to why a CEO cannot be made redundant. Third, and in any event, the issue raised by this ground of appeal was not raised and argued before the learned Industrial Magistrate at first instance. Thus, it cannot now be raised and argued for the first time on appeal.

32      In relation to ground 3, the respondent submitted that the basis for this ground is the learned Industrial Magistrate’s finding that after 23 March 2020, the appellants no longer had a job of CEO. The respondent contended that this conclusion was well open on the evidence and indeed was Mr Elsegood’s evidence in cross‑examination.

33      Overall, the respondent contended that the findings of fact made by the learned Industrial Magistrate were open on the evidence at first instance and the conclusions reached by her Honour were correct. It was contended that the appeal should be dismissed.

The General Order - history and context

34      The General Order was made under s 50 of the Act. Section 50 enables the Commission in Court Session to make a General Order relating to industrial matters having application throughout the State, whether employees affected are covered by an award or industrial agreement or not. To the extent to which a General Order applies to employees covered by an award or industrial agreement, it may vary or add to them.

35      A General Order, and the General Order arising for consideration on this appeal, is an industrial instrument resulting from proceedings before the Commission In Court Session on the application of the then Trades and Labour Council of Western Australia (now UnionsWA), a body recognised under s 50 of the Act with standing to seek a General Order: Trades and Labour Council of Western Australia v Minister for Consumer and Employment Protection and Ors [2005] WAIRC 0134; (2005) 85 WAIG 1667 per Beech CC, Gregor SC and Kenner C.  A General Order, as with an award or an industrial agreement, may be the subject of an application for the interpretation of its terms under s 46 of the Act. This is because by s 46(5), it is provided that an ‘award’ for the purposes of s 46, ‘includes an order, including a General Order…and an industrial agreement’.

36      Being an industrial instrument made by the Commission under the Act, the well‑established principles applicable to the interpretation of industrial instruments have application. In The Australian Rail Tram and Bus Industry Union of Employees v Public Transport Authority of Western Australia [2017] WAIRC 00830; (2017) 97 WAIG 1689, Smith AP (as she then was) (Scott CC agreeing) set out the relevant principles of interpretation adopted and applied by Full Benches of the Commission at [75] ‑ [80] as follows:

75 In determining whether a party to proceedings has contravened or failed to comply with a provision of an industrial instrument, an Industrial Magistrate's Court must necessarily interpret the provisions of an industrial agreement in accordance with the principles that apply to the interpretation of industrial agreements:  Director General, Department of Education v United Voice WA [2013] WASCA 287; (2013) 94 WAIG 1.  These principles are also to be applied by the Commission when hearing and determining an application for the true interpretation of an award as defined under s 46 of the Act, which includes an industrial agreement.

76 In Health Services Union of Western Australia (Union of Workers) v The Director General of Health [2012] WAIRC 01117; (2012) 93 WAIG 1, Beech CC and I observed that [38] - [40]:

Firstly, it is clear that the task of construction of industrial instruments is to be approached in a way that allows for a generous construction. Secondly, part of the context of construction of an industrial instrument is how it is made. Where an industrial instrument is an award, the principles to be applied were set out by French J in City of Wanneroo v Holmes (378 - 379) where his Honour said:

The interpretation of an award begins with a consideration of the natural and ordinary meaning of its words: Re Clothing Trades Award (1950) 68 CAR 597 (Aust Indus Ct, Full Ct). The words are to be read as a whole and in context: Australian Timber Workers Union v W Angliss & Co Pty Ltd (1924) 19 CAR 172. Ambiguity if any, may be resolved by a consideration, inter alia, of the history and subject matter of the award: Picard v John Heine & Son Ltd (1924) 35 CLR 1. Resort to such matters as prefatory statements and negotiations is of dubious assistance if admissible at all: Seymour v Stawell Timber Industries Pty Ltd (1985) 13 IR 289 at 290; 9 FCR 241 at 244 (Northrop J) (13 IR at 299; 9 FCR at 254) (Keely J) cf 13 IR at 309; 9 FCR at 265 (Gray J). The logs of claim and arbitrator's reasons for decision may be referred to determine the ambit of the dispute which led to the making of the award so that where there are two possible interpretations, one within the ambit and one without, the former may be preferred. Evidence of the conduct of the parties subsequent to the making of the award however, cannot be relied upon to construe it: Seamen's Union of Australia v Adelaide Steamship Co Ltd (1976) 46 FLR 444, 446, disapproving Merchant Seamen's Guild of Australia v Sydney Steam Collier Owners and Coal Stevedores Association (1958) 1 FLR 248. That is not to say the words must be interpreted in a vacuum divorced from industry realities. As Street J said in Geo A Bond & Co Ltd (in liq) v McKenzie [1929] AR(NSW) 498 at 503:

'… it must be remembered that awards are made for the various industries in the light of the customs and working conditions of each industry, and they frequently result ... from an agreement between the parties, couched in terms intelligible to themselves but often framed without that careful attention to form and draughtsmanship which one expects to find in an Act of Parliament. I think, therefore in construing an award, one must always be careful to avoid a too literal adherence to the strict technical meaning of words, and must view the matter broadly, and after giving consideration and weight to every part of the award, endeavour to give it a meaning consistent with the general intention of the parties to be gathered from the whole award.' – See also Re Crown Employees (Overtime) Award [1969] AR(NSW) 60 at 63; Re Hospital Employees Administrative and Clerical (State) Award (1982) 2 IR 123.

It is of course no part of the court's task to assign a meaning in order that the award may provide what the Court thinks is appropriate – Australian Workers Union v Graziers Association (NSW) (1939) 40 CAR 494. Indeed it has been said that a tribunal interpreting an award must attribute to the words used their true meaning even if satisfied that so construed they would not carry out the intention of the award making authority – Re Health Administration Corporation; Re Public Hospital Nurses (State) Award (1985) 12 IR 122; Rogers Meat Co Pty Ltd v Howarth [1960] AR(NSW) 291; Re Government Railways and Tramways (Engineers etc) Award [1928] AR 53 at 58 (Cantor J).

Justice French subsequently reaffirmed what he said in City of Wanneroo v Holmes in City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union when he observed [57]:

It is of course necessary, in the construction of an award, to remember, as a contextual consideration, that it is an award under consideration. Its words must not be interpreted in a vacuum divorced from industrial realities — City of Wanneroo v Holmes (1989) 30 IR 362 at 378-379 and cases there cited. There is a long tradition of generous construction over a strictly literal approach where industrial awards are concerned — see eg George A Bond & Co Ltd (in liq) v McKenzie [1929] AR (NSW) 498 at 503-504 (Street J). It may be that this means no more than that courts and tribunals will not make too much of infelicitous expression in the drafting of an award nor be astute to discern absurdity or illogicality or apparent inconsistencies. But while fractured and illogical prose may be met by a generous and liberal approach to construction, I repeat what I said in City of Wanneroo v Holmes (at 380):

Awards, whether made by consent or otherwise, should make sense according to the basic conventions of the English language. They bind the parties on pain of pecuniary penalties.

Later, Kirby and Callinan JJ in Amcor Ltd v Construction, Forestry, Mining and Energy Union [2005] HCA 10; (2005) 222 CLR 241; (2005) 79 ALJR 703; (2005) 138 IR 286 [96] and [129] favoured an even more generous contextual approach that had been expressed in Kucks by Madgwick J who had said (184):

It is trite that narrow or pedantic approaches to the interpretation of an award are misplaced. The search is for the meaning intended by the framer(s) of the document, bearing in mind that such framer(s) were likely of a practical bent of mind: they may well have been more concerned with expressing an intention in ways likely to have been understood in the context of the relevant industry and industrial relations environment than with legal niceties or jargon. Thus, for example, it is justifiable to read the award to give effect to its evident purposes, having regard to such context, despite mere inconsistencies or infelicities of expression which might tend to some other reading. And meanings which avoid inconvenience or injustice may reasonably be strained for. For reasons such as these, expressions which have been held in the case of other instruments to have been used to mean particular things may sensibly and properly be held to mean something else in the document at hand.

…

37      In TLC and Ors at [2], the Commission in Court Session referred to the claim for a General Order having its origins in the Termination, Change and Redundancy cases. This origin, in the context of the relevant contract provision there under consideration, was also discussed by Blue J in Bampton, at [189] ‑ [195].  His Honour noted that the Termination, Change and Redundancy award clause for redundancy was based on the definition adopted by Bray CJ in R v Industrial Commission (SA); Ex parte Adelaide Milk Supply Co‑operative Ltd (1977) 16 SASR 6. The passage of Bray CJ’s judgment at [8], was cited by her Honour at first instance at [46] of her reasons.  This broad meaning of ‘redundancy’, and the circumstances in which it may occur, were a part of the industrial history and context in the Commission in Court Session’s consideration in making the General Order in the terms that it did.

38      In this respect, the Commission in Court Session noted in its decision at [29] ‑ [33] that the Termination, Change and Redundancy clause had, by the time of those proceedings, been adopted widely, both by variations to many State awards of this Commission, more broadly in other industrial jurisdictions throughout Australia, and was also inserted into Part 5 of the Minimum Conditions of Employment Act 1993 (WA). Specifically, in relation to the definition of ‘redundancy’, and those aspects of the TLC claim that departed from the ‘standard clause’ adopted in State awards following the Termination, Change and Redundancy decisions, the Commission in Court Session observed at [78] ‑ [82] as follows:

Redundancy – the definition

78 In relation to the provisions claimed regarding redundancy we note those parts of the claim which are consistent with the determinations of the previous Commissions in Court Session already referred to. The claim defines redundancy as where an employer has made a definite decision that the employer no longer wishes the position the employee held to be held by anyone and that decision leads to the termination of employment of the employee (emphasis added). The clause as approved by this Commission on previous occasions defines redundancy as occurring where an employer has made a definite decision that the employer no longer wishes the job the employee has been doing done by anyone and this is not due to the ordinary and customary turnover of labour and that decision leads to the termination of employment of the employee.

79 The definition as approved by this Commission on previous occasions is one of relatively long standing. It is a definition which is consistent in its language with both s.40 of the MCE Act and the definition in the AIRC Redundancy decision. While we have had regard to the submissions of the TLC in support of its claim on the material before us we are not persuaded that a change is warranted to what is otherwise an accepted definition of redundancy because the definition is wide enough to include a position being abolished. As EM Heenan J observed in Garbett v Midland Brick Company Pty Ltd (2003) 83 WAIG 893 at [76] not only does redundancy occur where an employer no longer requires that work to be performed by anyone (citing R v Industrial Commission of South Australia; Ex parte Adelaide Milk Supply Co‑Operative Ltd (1977) 16 SASR 6), organisational restructuring may result in a position being abolished and the functions of that position being divided or given to others (citing Bunnett v Henderson's Federal Spring Works Pty Ltd (1989) 31 AILR 356).

80 The TLC claim also omits the words commonly found at the end of the definition: “except where this is due to the ordinary and customary turnover of labour”. The TLC submitted that the words are no longer relevant and add nothing to the definition except the potential for confusion. The history of the words was said to be related to the economic recession present in 1983 and the New South Wales Industrial Relations Commission decision in Shop, Distributive and Allied Employees Association (New South Wales) v Countdown Stores (1983) 7 IR 273. The TLC submitted that the South Australian Industrial Relations Commission in 1987 omitted the words for the reason that the distinction between employees who lose their jobs in times of recession and those who lose their jobs in times of economic prosperity is not tenable; standards for redundancy, it is submitted, are now accepted throughout Australia and by this Commission regardless of economic circumstances.

81 The omission of the words was opposed on the basis that the words are not ambiguous and have been readily interpreted and applied by the Commission.

82 We note that the definition of redundancy in the Minimum Conditions of Employment Act 1993 which is applicable to employees in this State generally by virtue of that legislation does not contain those words. Therefore including them in the General Order to issue will result in a provision which is less favourable than the corresponding condition in the MCE Act: that Act requires discussions to occur whether or not the decision that the employer no longer wishes the job the employee has been doing done by anyone is due to the ordinary and customary turnover of labour. That provision of the MCE Act presently applies and therefore those words will be omitted from the General Order to issue.

39      In particular, the observations of the Commission in Court Session at [79] refer to the circumstance of a restructuring of an organisation leading to a position (or job) being abolished and the functions of that position being given to others. Those observations are consistent with the views expressed by Kourakis CJ (Vanstone J agreeing) in Bampton, cited by the learned Industrial Magistrate at [43] of her reasons, where Kourakis CJ rejected the employer’s argument to the contrary in that case.

40      In Short, an appeal to the Full Court of the Federal Court concerned the application of cl 31 of the Metal Industry Award 1984 in relation to redundancy. In this matter, the Industrial Court of South Australia found that the respondent, FW Hercus Pty Ltd, had failed to pay the appellant an amount for severance pay. On appeal to a single judge, the appeal was upheld and the order to pay Mr Short severance pay was set aside. On appeal to the Full Court, the court (Keely, Burchett and Drummond JJ) was required to consider whether the employer had failed to comply with its award obligations.

41      At the time of his dismissal, the appellant was one of two full‑time drafting employees employed by the respondent. The proprietor of the firm, Mr Hercus, also performed drafting work. Due to financial difficulties, resulting from a downturn in trade, the respondent needed to reduce the number of employees. Whilst drafting work was still required to be done by the respondent as a part of its business, the appellant’s drafting position was not continued. The appellant contended that his termination of employment constituted a redundancy under cl 31 of the Award. The respondent contended that the appellant was ‘retrenched’ because of insufficient work, and not because the respondent ‘wished’ that drafting work no longer be done. The relevant first part of cl 31 ‑ Redundancy of the Award in issue in those proceedings, was in very similar terms to the definition of redundancy in cl 4.1 of the General Order, and it provided as follows:

Discussions before termination

(a) (i) where an employer has made a definite decision that the employer no longer wishes the job the employee has been doing done by anyone and this is not due to the ordinary and customary turnover of labour and that decision may lead to termination of employment…

42      As noted, the words ‘and this is not due to the ordinary and customary turnover of labour’ were not included in the definition determined by the Commission in Court Session.  They are not material to these proceedings.  In relation to the argument put by the respondent about the employer’s ‘wishes’, Keely J considered that the focus is whether the employer no longer wants or requires or desires a particular job done. At [131], his Honour said:

…in my opinion the respondent had made a “definite decision” that it “no longer [wished] the job…done by anyone…”. It is not to the point that, before making that decision, the respondent “wished” that it was not experiencing a downturn in trade and wished that it did not have to let the appellant go because of that downturn in trade. It plainly no longer required the job done and the reason for that decision was that, as a result of the downturn in trade, “we just have not got it to be done”.

The “definite decisions” to which the subclause refers is a “decision that the employer no longer wishes the job…done by anyone…”. In my opinion the words “employer no longer wishes” mean that the employer no longer “wants” or “requires” or “desires” the job done. That wish is formed after considering the matter and making a definite decision as to what it “wishes”. The word “wishes” in the subclause is not referring to the “wish” of the employer that it had sufficient orders so that it could not “have to let him [the employee] go”.

43      In his judgment, Burchett J commented on circumstances in which cl 31(a)(i) of the Award would become operative as follows:

…[B]ut the clause is not made conditional upon the employer wishing to retrench an employee. The clause simply postulates the cessation of the employer’s wish to have the particular job done by anyone. That may be because some delightful alternative has enticed the employer; because the job has just come to an end: because of the employer’s insolvency; or for any one of a number of other reasons. The clause does not say that the employer must be happy about his decision; only that he must have made it.

44      His Honour then went on to consider the importance of history and context in the interpretation of industrial awards and specifically the redundancy clause in terms of its general purpose and policy.  It was his Honour’s opinion from that history, the clause under consideration concerning redundancy, was not intended to have a restricted meaning. Rather it should be construed broadly, as being applicable to redundancy for whatever reason. The history that informed his Honour’s conclusion in this respect commenced with Adelaide Milk and the observations of Mitchell J and Bright J in that case. In particular, his Honour focused on the breadth of meaning of ‘redundancy’ as enunciated by Bray CJ in that case, adopted and applied in the Termination, Change and Redundancy cases, referred to above.

45      Burchett J at [138], referred to the words used in cl 31 of the Award as being formulated by Bray CJ in Adelaide Milk and observed that they were adopted in the Termination, Change and Redundancy cases, became a standard form of clause, and were incorporated widely in awards, as noted by the Commission in Court Session in its decision. In concluding in this respect, his Honour continued at [138]:

Any ambiguity in expression of cl 31 is clarified when its sources are examined. In the nature of the industrial process, the draftsmen of the variation of the award must have been acquainted with those sources. It is not to be thought that the words of Bray CJ were deliberately chosen to convey a meaning quite other than this meaning. Especially this is so when his meaning had been examined in detail by the Australian Conciliation and Arbitration Commission in the Termination, Change and Redundancy cases.

46      Drummond J agreed generally with the reasons of Keely and Burchett JJ. His Honour noted at [139], his agreement with the observations of Burchett J, that recourse can be had to the ‘wider context of the award provision’. 

47      Accepting that a construction of cl 4.1 of the General Order faithful to the text must be adopted, from the above analysis, the meaning of the definition of ‘redundancy’, in cl 4.1 as a matter of industrial history and context, is also to be informed by the breadth of the meaning of the term so adopted. The definition should be construed broadly. This is the consistent approach of the Commission to the interpretation of industrial instruments; was the approach of the Court in Short, in considering an award provision definition in very similar terms to cl 4.1 of the General Order; and was also the approach adopted in Bampton.  It is the approach I will take in this appeal. 

Consideration

Ground 1

48      Returning then to the grounds of appeal.  The gravamen of ground 1 appears to be a complaint that the learned Industrial Magistrate erred in not concluding that the appellants had made ‘no definite decision’ that it wished the respondent’s job to be not done by anyone. The evidence at first instance as to the events of 23 March 2020 was brief. The respondent said in his witness statement that on the morning of 23 March 2020, both Mr Elsegood and Mr Douglas came into his office unannounced. Mr Douglas conducted the meeting. He told the respondent that the respondent had yet to reply to a request from Mr Elsegood that he agree to a reduction in his salary. The respondent replied that he had received no such request. On being told this, the respondent said that Mr Douglas retracted what he had said and informed him that it would be better for the respondent to resign.

49      The respondent told both Mr Elsegood and Mr Douglas that he did not want to resign. Mr Douglas then informed the respondent that the business could no longer afford his remuneration. The respondent said Mr Douglas made mention of termination of his employment. The respondent asked what reduction in his salary was being requested by the appellants and that this be put in writing. Some discussion then took place with Mr Douglas suggesting that the respondent and he go ‘off‑site’ to discuss the matter of his notice. The respondent declined. When it was put to him in cross‑examination that the appellants wanted to keep him in their employment, the respondent replied that this was not evident from the meeting. Both Mr Elsegood and Mr Douglas then left the room, with Mr Douglas returning a short time later. Mr Douglas then informed the respondent that his employment was being terminated that day and he was to clear out his office, which the respondent then did. The dismissal was confirmed in writing the same day, in terms as set out earlier in these reasons.

50      Mr Douglas was not called to give evidence. Mr Elsegood largely confirmed the respondent’s version of the events in his testimony. He said by early 2020 the position of the appellants’ business was becoming perilous. Reductions in salaries of management staff were being discussed. The respondent’s position was considered and Mr Elsegood said that if he did not take a reduction in his remuneration, his employment would have to end. From this evidence, the termination of the respondent’s employment was clearly in contemplation at an early stage.

51      Mr Elsegood confirmed that Mr Douglas put to the respondent in the meeting on 23 March 2020 that the appellants’ business was in a perilous state, and it could not afford a CEO at the respondent’s rate of salary. Unless the respondent agreed to a reduction, Mr Elsegood then said it was ‘best if CMI and Mr Mahon parted company and it would look better if he resigned’ (Mr Elsegood’s witness statement at [7]). Mr Elsegood confirmed that a short break in the meeting then took place, following which he said both himself and Mr Douglas returned to the respondent’s office and the respondent was told his employment was being terminated on financial grounds.

52      After the respondent left the business, Mr Elsegood testified that he took over the duties of the former CEO and Mr Douglas’ company provided some consultancy services to assist Mr Elsegood in this regard. The precise nature of that assistance was not in evidence. Mr Elsegood confirmed that he was a working partner in the appellants’ business prior to this time. This situation continued until August 2021, when Mr Elsegood said that a new CEO was appointed. Mr Elsegood further confirmed in his evidence that after the respondent was dismissed, there was no separate job of a CEO in the business.

53      The contention advanced by this ground of appeal that the evidence supported the conclusion that the appellants wished to keep the respondent in his job cannot be sustained. Consideration must be given to the timing of the relevant events. It was the case that on Mr Elsegood’s undisputed evidence the appellants had in mind a reduction in salaries for management, which included the respondent, due to the financial state of the appellants’ business. On the evidence, it seemed that a similar arrangement had been entered into with the respondent, some years prior.

54      However, it was also clear on Mr Elsegood’s evidence, as noted above, that the dismissal of the respondent was in prospect, should he not agree to a reduction in his remuneration. The meeting that took place on 23 March 2020 was in two stages. The first stage was the initial discussion with the respondent, albeit brief, where Mr Douglas on behalf of the appellants put a proposal for the respondent’s remuneration to be reduced because the business could not afford to keep paying him his then rate of salary. This course of action was not accepted by the respondent.

55      At that point, the second stage of the meeting took place. Consistent with Mr Elsegood’s evidence, faced with the respondent’s refusal to take a reduction in his pay, and after a brief adjournment of the meeting, the appellants decided to dismiss the respondent on financial grounds. This decision was then communicated unequivocally to the respondent on the resumption of the meeting. The dismissal was summary in nature, albeit with subsequent payment of entitlements. By that time a definite decision had been taken, and it was implemented forthwith.

56      Based on that evidence, all the learned Industrial Magistrate’s findings at [16] ‑ [27] (AB12) were open and indeed, were the only findings reasonably open, on the evidence. The contention advanced by the appellants that at [48] of her Honour’s reasons, where the appellants contended that her Honour correctly found that the appellants wished to keep the respondent in employment, is to misconstrue this finding. What her Honour said in this paragraph was entirely consistent with the evidence. The appellants being willing to retain the respondent in their employment if he did what they wished was one thing. On the basis that the respondent did not do what the appellants wanted, and this led to his dismissal, could not, and did not, exclude the dismissal being properly characterised as a redundancy.

57      There was no error committed by the learned Industrial Magistrate and this ground is not made out.

Ground 2

58      This ground suggests that a CEO of a business cannot be made redundant. The basis for such an assertion seemed to be that, given the nature of the job of a CEO, as the ultimate decision maker, a business must always have one. No authority or point of principle was advanced by the appellants to support this contention. Whilst the response filed by the appellants at first instance alluded to this issue in the briefest of terms by the statement ‘The job is not one that could be abolished’ (AB34), no reference was made to this issue in the appellants’ written or oral submissions to the court in the proceedings at first instance. That is, at no stage of the proceedings was the attention of the court or the respondent drawn to this issue, as one that the appellants intended to press as a defence to the respondent’s claim.

59      At [12] of the appellants’ written outline of submissions in these proceedings, it is contended that her Honour failed to find:

…that the role and function of a CEO is one that cannot be made redundant other than on the winding up of the business because the CEO’s principal role and function is to be the ultimate decision maker in the organisation.

60      This contention was never put to the learned Industrial Magistrate as part of the appellants’ case at first instance. Accordingly, the respondent had no opportunity to respond to it and her Honour no opportunity to consider it as a part of the court’s process of reasoning and decision making. The Industrial Magistrates Court is not a court of pleadings.

61      The general approach is that a party is bound by its case and, except in very limited circumstances, a point not raised in proceedings may not be raised for the first time on appeal. The relevant principles applicable to this issue were set out in some detail by Smith AP (as she then was) in Alfresco Concepts Pty Ltd v Troy Patrick Franse [2015] WAIRC 00244; (2015) 95 WAIG 437. Whilst that was an appeal to the Full Bench under s 49 of the Act from a decision of the Commission, her Honour considered and applied the general principles applicable to appellate intervention. At [114] Smith AP said:

114 …In Kingstyle Investments, the principles that apply when a new point is sought to be raised on an appeal were considered.  At [50] - [54] I observed:

Appeals brought under s 49 of the Industrial Relations Act 1979 (WA) (the IR Act) are not by way of rehearing, but are appeals in the strict sense:  Hamersley Iron Pty Ltd v Association of Draughting, Supervisory and Technical Employees, Western Australian Branch (1984) 64 WAIG 852; see the discussion in The Minister for Health v Drake-Brockman [2012] WAIRC 00150; (2012) 92 WAIG 203 [73] (Smith AP and Beech CC).  Fresh evidence can, however, be admitted by a Full Bench where special or exceptional circumstances are raised:  Federated Clerks' Union of Australia, Industrial Union of Workers, WA Branch v George Moss Ltd (1990) 70 WAIG 3040.  This does not allow a matter to be heard without regard to the manner in which a matter was conducted at first instance.  In Rizhao Steel Holding Group Co Ltd v Koolan Iron Ore Pty Ltd [2012] WASCA 50, Martin CJ set out the circumstances when a new point may be raised on appeal to an appellate body at [49] - [52]:

49 [I]n University of Wollongong v Metwally (No 2) [1985] HCA 28; (1985) 60 ALR 68, the High Court observed:

It is elementary that a party is bound by the conduct of his case. Except in the most exceptional circumstances, it would be contrary to all principle to allow a party, after a case had been decided against him, to raise a new argument which, whether deliberately or by inadvertence, he failed to put during the hearing when he had an opportunity to do so (71).

50 Similar observations were made by the Court of Appeal of New South Wales in the case under appeal in Coulton v Holcombe. Their Honours observations as to:

... the finality of litigation; the difficulty of inducing an appeal court to consider new facts; the undesirability of encouraging tactical decisions not to present an issue at first instance: keeping it in reserve for appeal; and the need for vigilance to avoid injustice to a party having to meet new facts and new issues of law for the first time at the appeal court

were endorsed by the plurality in Coulton v Holcombe (8) as important principles underpinning the public interest in the finality of litigation: see also Liftronic Pty Ltd v Unver [2001] HCA 24; (2001) 179 ALR 321, 330 - 331 (Gummow and Callinan JJ).

51 However, this is not to say that a new point can never be raised on appeal. In Water Board v Moustakas [1988] HCA 12; (1988) 180 CLR 491, the plurality (Mason CJ, Wilson, Brennan and Dawson JJ) observed:

It is true that in Maloney v Commissioner for Railways (1978) 18 ALR 147, 152 it was recognised that in 'very exceptional cases' a plaintiff's omission to put at trial a case formulated on appeal may not be conclusive against him. But it was pointed out that the opportunity to assert the new case at another trial should only be granted where the interests of justice require it and such a course can be taken without prejudice to the defendant. No exceptional circumstances arise in this case where the parties adopted the course which they took of their own choice (498).

52 It is significant to note that the High Court has twice described the circumstances in which a party will be allowed to raise a new point on appeal as 'very exceptional'. Such a course will only be permitted if two requirements are met. First, the interests of justice must require determination of the new point. Second, there must be no prejudice to the party against whom the new point is taken.

…

(paragraph deleted)

…

In Minister for Education v Liquor Hospitality and Miscellaneous Union, Western Australian Branch [2011] WAIRC 00818; (2011) 91 WAIG 1839 [23] - [24], I had regard to the principles set out in Water Board v Moustakas (1988) 180 CLR 491, 497 - 498 and then had regard to the observations of Branson and Katz JJ in H v Minister for Immigration and Multicultural Affairs [2000] FCA 1348 [7] - [8] where their Honours said:

In our view, the readiness with which appeal courts have in the past been satisfied that it is expedient in the interests of justice to allow a fresh point to be argued and determined on appeal is unlikely to continue into the future. The volume and complexity of the cases presently required to be heard and determined by the intermediate appellate courts of Australia is such that it is increasingly important that such courts are able to devote their time to the genuine review of first instance decisions. It is becoming increasingly difficult, in our view, to establish that it is expedient in the interests of justice that the time of three or more judges should be spent giving original consideration to issues that ought to have been raised before the primary judge. The interests of justice in this sense extend beyond the interests of the parties to the appeal to encompass the interests of other litigants whose appeals require hearing and determination, and the broad public interest in efficient judicial administration.

I then observed at [25] - [26]:

25 When assessing whether it would be expedient in the interests of justice to allow a new point to be raised Branson and Katz JJ also had regard to whether the point had any merit [9].

26 From these passages the following principles guide when a finding could be made that it is expedient and in the interests of justice to entertain a point:

(a) The point must be one of construction or of law and not be met by calling evidence.

(b) In deciding whether or not a point was raised at trial no narrow or technical view should be taken. Ordinarily the pleadings will be of assistance.

(c) In very exceptional cases an omission to put a case formulated on appeal may not be conclusive. The opportunity to assert the new case should be granted only where the interests of justice require it and such a course can be taken without prejudice to the defendant.

(d) Consideration of the interests of justice should extend to a consideration of relevant matters beyond the interests of the parties to the interests of other litigants and efficient case management.

(e) When assessing the interests of justice, the merit of the new point sought to be raised is a relevant consideration.

62      Her Honour also referred to decisions of the Court of Appeal dealing with the same issue as follows at [115]-[116]:

115 The principles that govern the circumstances in which a party would be allowed to raise on appeal an argument which had not been raised in proceedings below were recently applied by the Court of Appeal in Primewest (Mandurah) Pty Ltd v Ryom Pty Ltd [2014] WASCA 28.  When summarising the well-established principles Martin CJ (Pullin and Murphy JJA agreeing) [85] said in relation to the prejudice which a party may suffer as a result of the other party being able to raise a new argument on appeal that the following comments of Gleeson CJ, McHugh and Gummow JJ in Whisprun Pty Ltd v Dixon [2003] HCA 48; (2003) 77 ALJR 1598 [51] are of direct relevance.  In Whisprun, their Honours said:

It would be inimical to the due administration of justice if, on appeal, a party could raise a point that was not taken at the trial unless it could not possibly have been met by further evidence at the trial (University of Wollongong v Metwally [No 2] (1985) 59 ALJR 481 at 483; Coulton v Holcombe (1986) 162 CLR 1 at 8-9; Liftronic Pty Ltd v Unver (2001) 75 ALJR 867 at 875 [44]; Water Board v Moustakas (1988) 180 CLR 491 at 496-497; cf R v Birks (1990) 19 NSWLR 677 at 683-685). Nothing is more likely to give rise to a sense of injustice in a litigant than to have a verdict taken away on a point that was not taken at the trial and could or might possibly have been met by rebutting evidence or cross-examination. Even when no question of further evidence is admissible, it may not be in the interests of justice to allow a new point to be raised on appeal, particularly if it will require a further trial of the action (Multicon Engineering Pty Ltd v Federal Airports Corporation (1997) 47 NSWLR 631 at 645-646). Not only is the successful party put to expense that may not be recoverable on a party and party taxation but a new trial inevitably inflicts on the parties worry, inconvenience and an interference with their personal and business affairs.

116 Recently applied by Martin CJ (Mazza JA and Hall J agreeing) in Calandra v Civil Aviation Safety Authority [2015] WASCA 31 [19]. 

63      It is not appropriate for the appellants to put a submission to the Full Bench on appeal that her Honour failed to make a particular finding at first instance, when the affirmative proposition was never fairly and squarely raised as a part of the appellants’ case before the court. This is not a question of jurisdiction:  SGS Australia v Taylor (1993) 73 WAIG 1760. The General Order has application to all employees within the Commission’s jurisdiction throughout the State. By its terms, it contains no exclusions of categories of employees.

64      I am not persuaded that the point raised has any merit, such that it would be in the interests of justice for it to be permitted to be raised on this appeal for the first time. No authority or point of principle was advanced by the appellants in submissions that the respondent, as the CEO, could not be made redundant by nature of the job he held. From the materials before the court, as set out in the respondent’s Executive Service Agreement (AB 65-87), the respondent was employed by the appellants as a partnership, comprising five natural persons and two companies. As a partnership, whilst it is collectively under s 10 of the Partnership Act 1895 (WA) a firm, the partnership has no separate legal personality: Federal Commissioner of Taxation v Sahhar (1985) 59 ALR 98 per Lockhart J at 102; Atwell v Roberts [2013] WASCA 37; (2012) 43 WAR 507 per Buss JA at [121].

65      A business carried on by a partnership may be actively carried on by a partner or a manager, as an employee: Playfair Development Corp Pty Ltd v Ryan [1969] 2 NSWR 661. All partners can participate in the management of a partnership, subject to the terms of the relevant partnership agreement. The overall management of a partnership may be delegated by the partners under a partnership agreement, to a managing partner, or group of partners, even though the position of a managing partner is not one legally recognized: Ex parte Merrett (1997) 140 FLR 412 per Young J at 417. 

66      In this case, Mr Elsegood, as the Managing Partner, took over the responsibilities of running the business, on the abolition of the CEO position.  He did so as the Managing Partner. The partners were entitled to employ the respondent in the position as the CEO, under the Executive Employment Agreement between the partnership and the respondent.  They were also entitled to abolish the position and terminate the Agreement, which they did.  Contrary to the submissions of the appellants, given the nature of a partnership, there is no requirement in the general law, or under the Partnership Act 1895 (WA), that requires a partnership as a firm, to have a ‘CEO’, as the ultimate decision maker, as the ground of appeal seems to suggest.  

67      This ground is not made out.

Ground 3

68      The appellants contended that the learned Industrial Magistrate was in error when she concluded at [57] of her reasons that there was an irresistible inference that the result of the events of 23 March 2020 was that the respondent no longer had any functional duty remaining for him to perform, and this resulted from the appellants’ decision that it no longer wanted the respondent’s former job of CEO to be done by anyone.

69      The uncontroverted evidence at first instance was that the job of CEO that the respondent had performed since June 2015 had ceased to exist. That was Mr Elsegood’s evidence, referred to above. This was because of the economic necessity to reduce costs, given the financial position of the business. Irrespective of whether the former responsibilities and functions of the respondent were assumed by one, two or more other persons, the indisputable fact was that there were no longer any duties or functions available to be performed by the respondent.

70      The appellants referred to and relied upon a decision of the of New South Wales Court of Appeal in UGL Rail Services.  The appellants contended that in UGL, a general manager was dismissed, and another person appointed to perform much the same functions as the person dismissed.  It was held by the Court that this did not to constitute a redundancy. UGL is distinguishable firstly on the facts, and secondly, on the basis that the redundancy provision under consideration did not involve application of the Termination, Change and Redundancy type award entitlement, construed in the context of its origin and historical application, but rather, an undefined term of a common law contract.

71      In UGL, the respondent was employed as the appellant’s General Manager, Strategic Projects.  The appellant manufactured rail infrastructure and rolling stock and provided rail maintenance services. By a side letter, the respondent was entitled to severance payments if he was made redundant. There was nothing else in the contract identifying what that meant.  At first instance, a judge of the District Court found the respondent was made redundant when his employment was terminated after a restructuring.  A claim based on an options clause of the contract was rejected. 

72      The relevant facts in UGL were the appellant company reorganized the area of operations in which the respondent worked.  The respondent was replaced by another person from inside the company, who took over much of the respondent’s job of General Manager, Strategic Projects, which was retitled as ‘General Manager Passenger Sales’.  There was no suggestion that the appellant was in financial difficulty or that the respondent had become superfluous to the appellant’s needs.  The appellant contended that the respondent’s employment was not terminated because his job had been abolished, rather, the appellant no longer wanted the respondent performing the job, which was given to someone else.  The Court upheld the appeal and found the respondent was not made redundant.  In the judgment of the Court, Sackville AJA (Adamson J agreeing), considered the common law cases as to the meaning of redundancy, and noted the importance of context, when considering its meaning.  In referring to the observations of Vickery J in Hodgson v Amcor Ltd (2012) 264 FLR 1, his Honour said:

The opening words of this extract must be kept in mind: the starting point for analysis must be the language of the relevant statute, award or contract of employment. Subject to this qualification, Vickery J's analysis in my view accurately summarises the principles stated in the cases. The key concept is that the job performed by the claimant ceases to exist, or the duties have so changed that for all practical purposes the role no longer exists. This concept cannot be applied in the manner of a mathematical formula. A difficult judgment may have to be exercised, for example where the nominal position remains in place but the duties of that position are substantially altered: see Commonwealth Bank of Australia v Financial Services Union at [27]. Similarly, if the name of the position has been changed, but many of the duties and responsibilities attached to the previous position are retained, there may be no redundancy. But the fact that the duties attached to a position have changed or some responsibilities have been transferred to other positions does not establish that the position, or the occupant of the position, has been made redundant. Ordinarily, it is necessary for the employee claiming to have been made redundant to show that the changes in the duties and responsibilities of a position are so substantial that for practical purposes the position no longer exists. That may come about in a particular case where a position appears to continue (whether under the name or a different name), but the duties and responsibilities of the position are so substantially altered that it is largely stripped of its functions.

73      Sackville J concluded that the respondent’s job was not ‘emptied of its duties’, his job was not abolished and nor had it ceased to exist: at [147]. Notably too, his Honour found that the appellant made it clear that the duties previously performed by the respondent needed to be performed ‘in a more vigorous manner’ and the importance of certain customers for the appellant’s business being looked after, suggesting an element of a lack of satisfaction by the appellant with the respondent’s performance.  Importantly, the appellant’s reasons for terminating the respondent’s employment did not involve abolishing his position or a redistribution of the functions of his job to others: at [150].

74      In this case, in the sense described by Bray CJ in Adelaide Milk at [8], the respondent’s employment was terminated not through any fault of his own, but because of the decision taken by the appellants to no longer have a job or position of CEO, because of financial constraints. That job, which the respondent formerly performed, no longer existed.  It being no longer in existence, the respondent no longer had any duties to perform.  It was not until August 2021 that the job of CEO was restored. The respondent was made redundant as defined in cl 4.1 of the General Order, as that definition should be interpreted, and the learned Industrial Magistrate made no error in reaching that conclusion, on all the evidence before her.

Conclusion

75      The appeal must be dismissed.

COSENTINO SC:

76      I have had the benefit of reading the draft reasons of the Chief Commissioner.  I agree with those reasons and have nothing further to add.

WALKINGTON C:

77      I also agree with the reasons of the Chief Commissioner and have nothing further to add.