Transfer of employee to new position; a dismissal?

The Fair Work Commission has held that an employer does not have the right to transfer an employee from one position to another without his or her consent, and that to legislate that outcome on an employer is a dismissal. The Commissioner went on to hold  “ In all of the circumstances of this matter, and having taken account of each of the factors set out in section 387 of the Act, I determine that Mr Keogh’s dismissal was harsh, unjust and unreasonable. It has been found that there was a valid reason for Mr Keogh’s dismissal and that, in this particular matter, the situation was such that the other criteria are neutral or simply not relevant.”

Make of that what you will.

In an extraordinary proposition, the Commissioner appears to have taken the view that an employer has no contractual right to vary the job of an employee without the employee’s consent unless such a right is conferred by a modern award.

This of course is contrary to the common law which does permit either party to a contract of employment to vary it upon notice, as is the case which all contracts which do not expressly forbid it. Of course, there will be occasions when the change is so dramatic that it will constitute a statutory unfair dismissal.

In my respectful view, the decision is wrong. The assertion that a party to a contract of employment which is otherwise silent about the rights of a party to vary a term of it on notice, cannot do so unless a modern award permits sucha variation cannot be correct.

“For the company to have the right to transfer Mr Keogh from his position of delivery driver to that of storeperson, the company first has to have the right to transfer Mr Keogh. If the company has the right, then the company is required to consult with Mr Keogh as per the relevant modern award (Road Transport and Distribution Award 2010) (the Award). I have formed the view that Mr Keogh has a contractual right to be employed as a delivery driver and that Mr Keogh had a verbal contract that he was employed as a delivery driver. The Award does not create the right to transfer an employee which cuts across an employee’s contractual right.

The employer can make a definite decision in relation to an organisational restructure but that decision cannot contravene an employee’s contractual right. In this case, Mr Keogh was employed as a driver and I have found that Mr Keogh’s conversion to permanent employment was from a casual delivery driver to a permanent delivery driver. This did not include an agreement that Mr Keogh would transition to the position of warehouse storeperson. As the verbal contract did not include that Mr Keogh would transfer to the storeperson’s position, it is my view that the company does not have the right to compel Mr Keogh to take on the new position – unless Mr Keogh agrees.

Accordingly, on this basis, I find that Mr Keogh was dismissed by his employer. Mr Keogh was forced to resign as a result of the employer’s action in unilaterally deciding that Mr Keogh would move from his driving position to that of warehouse storeperson and then employing another person to replace Mr Keogh as a driver. Mr Keogh was forced to resign because of this course of conduct by his employer, thereby meeting the requirements of section 386(1)(b) in relation to when a person has been dismissed.”

Keogh v French Par-Bake (2017) FWC 2865 delivered 26 May 2017 per Cribb C