QUEENSLAND INDUSTRIAL RELATIONS COMMISSION

CITATION:

PARTIES:	
	Deverge v State of Queensland (Queensland Health) [2021] QIRC 046

Deverge, Yolina
(Appellant)

v

State of Queensland (Queensland Health)
(Respondent)

CASE NO:
	PSA/2020/347
	
PROCEEDING:	Public Service Appeal – Appeal against a casual conversion decision
	
DELIVERED ON:	9 February 2021	
		
MEMBER:

HEARD AT:	Pidgeon IC

On the papers

OUTCOME:
	1.	The decision appealed against is set aside.

2.	Ms Deverge is to be offered conversion from casual to permanent. 
	
CATCHWORDS:

LEGISLATION:

CASES: 
	INDUSTRIAL LAW - Public Service Appeal - where the appellant applies for conversion from casual to permanent employment - where the appellant is not converted due to general operational requirements 

Public Service Act 2008, s 149

Industrial Relations Act 2016, s 562 

Directive 08/20 Casual Employment 

Gilmour v Waddell & Ors [2019] QSC 170

Holcombe v State of Queensland (Department of Housing and Public Works [2020] QIRC 195.

Morison v State of Queensland (Department of Child Safety, Youth and Women) [2020] QIRC 203
	
Reasons for Decision

	Appeal Details

[1]	Ms Deverge has been employed by the State of Queensland (Queensland Health) (the Respondent) since 17 September 2018. 

[2]	Ms Deverge is substantively employed as a casual (OO2-1) Operational Services Officer (Kitchen Assistant) at the Hervey Bay Hospital, with the Wide Bay Hospital and Health Service (WBHHS).

[3]	A schedule of Ms Deverge's employment history provided by WBHHS shows that over the last two years she has been engaged in various temporary contracts as well as engaged on a casual basis. 

[4]	On 12 October 2020, the Australian Workers' Union made a request on behalf of Ms Deverge that she be converted from a casual to permanent employee as per Directive 08/20 Casual Employment (the Directive).

[5]	In a decision letter dated 4 November 2020, the Chief Executive of WBHHS wrote to Ms Deverge stating that she was to continue as a casual employee at this time. In summary, the letter informed Ms Deverge that she was eligible for review, meets the merit requirements for the role but that conversion was not appropriate or viable at this time due to genuine operational requirements of the agency. Specifically,

As the Chief Executive, I am required to manage the full-time equivalent (FTE) establishment in line with the WBHHS staff (MOHRI) cap and budget. There are currently no budgeted vacancies within the area in which you are engaged in the circumstances as outlined in section 5.2 of the Directive and if I were to convert your employment to permanent, I would be required to create a new permanent position in which to place you which would be above the staffing cap for the WBHHS and without the required budget. I therefore find that there is a genuine operational requirement of this agency not to convert your employment to permanent at this time. 

[6]	On 24 November 2020, Ms Deverge filed her appeal against the decision. I am satisfied that Ms Deverge has made her appeal within the 21 day time period required.

[7]	The issue for me to determine in this appeal is whether the decision that Ms Deverge's employment not be converted from casual to a general employee on tenure was fair and reasonable. 

Relevant sections of the Act and Directive 

[8]	In order to determine the appeal, it is necessary to consider the relevant provisions of the Public Service Act 2008 ("the PS Act").

[9]	Section 149B of the PS Act relevantly provides

149B Review of status after 2 years continuous employment

(1)	This section applies in relation to a person who is a fixed term temporary employee or casual employee if the person has been continuously employed in the same department for 2 years or more.

(2)	However, this section does not apply to a non-industrial instrument employee.

(3)	The department's chief executive must decide whether to – 

(a)	continue the person's employment according to the terms of the person's existing employment; or

(b)	offer to convert the person's employment basis to employment as a general employee on tenure or a public service officer. 
…

(6) 	If the department's chief executive decides not to offer to convert the person's employment under subsection (3), the chief executive must give the employee a notice stating –

(a)	the reasons for the decision; and

(b) 	the total period for which the person has been continuously employed in the department; and
	…
(d) 	each decision previously made, or taken to have been made, under this section or section 149A in relation to the person during the person's period of continuous employment. 
	
The Directive

[10]	While all the provisions of the Directive have been considered, particular attention is paid to the following provisions:

1.	Purpose

1.1	The Public Service Act 2008 (PS Act) establishes employment on tenure is the default basis of employment in the public service, excluding non-industrial instrument employees and sets out the circumstances where employment on tenure is not viable or appropriate. 

1.2	This directive:

(a)	highlights key sections in the PS Act dealing with the employment and conversion of casual employees 

(b)	provides for the circumstances in which employment on tenure or a fixed term temporary employee is not viable or appropriate

(c)	sets out procedures for reviews and requirements for decisions
 ….

5. 	Employment of casual employees

5.1 	Section 148A of the PS Act (Appendix A) provides that casual employment should only be used when tenured or fixed term temporary employment is not viable or appropriate. 

5.2 	Use of tenured or fixed term temporary employment is generally not viable or appropriate where there is a need for short term employment, or to meet unpredictable, irregular or variable demand or in emergent situations, and casual employment may appropriately be used to meet these staffing needs. Examples of these types of circumstances include: 

(a)	backfilling tenured or fixed term temporary staff on short-term emergent leave

(b)	covering short gaps in work rosters of tenured and fixed term temporary employees 

(c)	in a role where work patterns or work demand is variable and difficult to predict, with each engagement standing alone 

(d) 	where needed to work irregular, informal, flexible, occasional or non-rostered hours. 

5.3 	Employment on tenure may be viable or appropriate if a person is required to be employed for a purpose mentioned in clause 5.2, such as covering gaps in various work rosters, on a regular and systematic basis. 
…
5.5 	An agency should periodically review the use of casual employees to appropriately limit casual employment in accordance with the provisions of the PS Act and to proactively manage its workforce planning. 
…
 	
8. 	Decision on review of status

8.1 	When deciding whether to offer permanent employment under section 149A or 149B, a chief executive must consider the criteria set out in section 149A(2):

•	whether there is a continuing need for the employee to be employed in the role, or a role which is substantially the same
•	the merit of the casual employee for the role having regard to the merit principle in section 27 of the PS Act
•	whether any requirements of an industrial instrument are complied with in relation to the decision, and
•	the reasons for each decision previously made, or deemed to have been made, under sections 149A or 149B in relation to the employee during their period of continuous employment. 

8.2 	Sections 149A(3) and 149B(5) of the PS Act provide that where the criteria above are met, the chief executive must decide, within 28 days, to offer to convert the person's employment to permanent employment as a general employee on tenure or a public service officer unless it is not viable or appropriate having regard to the genuine operational requirements of the agency.

What decisions can the Commission make?
[11]	In deciding this appeal, s 562C of the Industrial Relations Act 2016 (IR Act) provides that the Commission may:

(a)	confirm the decision appealed against; or
…
(c)	For another appeal-set the decision aside, and substitute another decision or return the matter to the decision maker with a copy of the decision on appeal and any directions considered appropriate. 

Ms Deverge's reasons for appeal

[12]	Ms Deverge submits that the decision of the WBHHS was not fair and reasonable when considering the subject matter, scope and purpose of the statute conferring the power. Reference is then made to the decision in Gilmour v Waddell & Ors.

[13]	With consideration to the above, Ms Deverge says that the Respondent erred by failing to consider all relevant factors within the objects and nature of the relevant legislation. Specifically:

(a)	The State has committed to engage employees permanently wherever possible and limit the use of casual employment;

(b)	casual employment should only be used when permanent employment is not viable or appropriate;

(c)	agencies are required to proactively manage their workforce planning to reduce their reliance upon casual and temporary employees; 

(d)	an extensive review process was created to facilitate the conversion of casual and temporary employees to permanency and limit inappropriate use of casual employment; and 

(e)	that process is subject to appeal in the QIRC, to ensure agency compliance.

[14]	Ms Deverge says that while all provisions of the Directive may have been considered, WBHHS have paid particular attention to 'budgeted vacancies'.  

[15]	With regard to genuine operational requirements, Ms Deverge says that genuine operational reasons preventing conversion to permanency must not be trivial and must be evidenced. Further, if the inconveniences inherent to all permanency conversions were sufficient to constitute genuine operational reasons, there would be no or few conversions.  That interpretation would defeat the purpose of the Directive and the review. 

[16]	Ms Deverge says that a 'reasonable' genuine operational reason is one which is sufficiently substantial as to warrant overcoming the government's commitment to permanent employment. 

[17]	To that end, Ms Deverge submits that it is an inherent requirement of converting any casual employee to permanency that there will be budgetary reallocations, backfilling requirements and the like. 

[18]	The difficulties faced by WBHHS if Ms Deverge is converted to permanent are no different to those posed to most agencies converting employees.  When considering budget provision, it is a superficial concern as to whether wages for a staff member come from a 'permanent' or 'casual' line item. 

[19]	The Directive does not prescribe that a casual's conversion relies on the existence of a current permanent vacancy.  The creation of a new permanent position is to be expected when converting any casual or temporary employee to permanency. 

[20]	Unreasonableness is a conclusion which may be applied to a decision which lacks any evidence and intelligible justification. Ms Deverge respectfully submits that the current decision falls within that class, and is not fair and reasonable when considering the Directive as a whole and the grounds relied upon by the Respondent. 

Respondent submissions 

[21]	The case for the respondent is, in summary:

•	Over the last two years, Ms Deverge has only been contracted to cover in roles where the incumbent position holder is temporarily absent due to recreation leave, sick leave, QSuper, training, graduated return to work, WorkCover, secondment or short-term increase in workload etc. Ms Deverge has never been contracted to cover either a long term vacant or unfunded position. 

•	There is a legitimate and genuine need for the use of casual and temporary employees within the operational services unit of the Hervey Bay Hospital. It is a workforce strategy utilised to ensure resourcing across a 24/7 roster allowing for the types of leave mentioned above.

•	Converting Ms Deverge to permanent will impact the workforce strategy by creating another permanent member of staff who will then require backfilling for any of the reasons above.

•	The Respondent would not only have Ms Deverge as an FTE over establishment, but also must engage another casual or temporary employee to backfill the ongoing leave of the newly converted Ms Deverge. 

•	These reasons are not trivial, nor are they managerial inconveniences or simply difficulties. 

[22]	The Respondent states that the purpose of the Directive is twofold: it establishes employment on tenure is the default basis of employment in the public service, excluding non-industrial instrument employees and sets out the circumstances where employment on tenure is not viable or appropriate.(Respondent emphasis)

[23]	With regard to the Employment Security Policy the department says the policy outlines the government's commitment to permanent employment where possible, however the policy also sets out a commitment to

developing and maintaining a responsive, impartial and efficient government workforce' and 'with workforce planning, career planning and skills development will ensure that the government workforce has the flexibility and mobility to meet future needs'…and "agencies are encouraged to utilise workforce planning, career planning and management strategies to assist in determining the appropriate workforce mix for current and future needs". (Respondent emphasis)

[24]	The Respondent does not dispute that Ms Deverge is eligible to appeal the decision.

Merit

[25]	The Department notes that Ms Deverge satisfies the merit requirements for the role.

Continuing Need

[26]	In reviewing Ms Deverge's employment history, it was determined that she was engaged in accordance with the circumstances set out in cl 5.2 of the directive; specifically to backfill and/or cover short gaps in work rosters of tenured or fixed term employees, and/or where her work pattern or demand is variable and difficult to predict, with each engagement standing alone, and/or where needed to work irregular, informal, flexible, occasional or non-rostered hours.  It was further determined by the decision maker that there is a continuing need to engage Ms Deverge in accordance with cl 5.2 of the Directive.

Genuine Operational Requirements

[27]	Ms Deverge's submissions refer to 'genuine operational reasons' throughout, which is terminology from the previous and now superseded Directive 01/17. Clause 8.2 utilises the phrase 'genuine operational requirements of the agency'. There is no definition of the phrase 'genuine operational requirements' in the Directive, nor in any of the relevant legislation.

[28]	The issue for determination is whether the decision-maker's reasons for not converting Ms Deverge's employment based on 'genuine operational requirements' was fair and reasonable in the circumstances. 

[29]	The Respondent refers to a decision of McLennan IC in Holcombe v State of Queensland (Department of Housing and Public Works)(Holcombe) where it was decided that the authority to determine the review lies squarely with the delegate or decision maker.  It is not a question of merit or whether there is work to be done.  The question is only whether the genuine requirements relied upon by the Respondent to deny the Appellant's request for conversion fair and reasonable.

[30]	The Respondent refers to the reasons given in the decision letter and says that they fall within the list of examples set out at cl 5.2 of the Directive and that that it does not have a genuine operational need to permanently employee two people in the same position.  Nor is it appropriate or viable to do so. 

[31]	The Respondent says it is not the case that it has focused on budgeted vacancies.  It says that the reason for not appointing is not that there are 'no vacancies', rather, 'there are currently no budgeted vacancies within the area in which you are engaged in the circumstances as outlined in section 5.2 of the Directive…'.

[32]	In determining whether its reasons support a finding that there is a genuine operational reason; and whether it is fair and reasonable, the Respondent submit that it is relevant to understand both the financial management and performance and accountability frameworks within which such decisions are made: 

•	The Financial Accountability Act 2009 (Qld) (FA Act) was enacted to govern public sector financial administration in Queensland and sets out strategic legal obligations with which agencies must comply;

•	subordinate legislation, consisting of the Financial and Performance Management Standard 2019 and the Financial Accountability Regulation 2019 have the aim of establishing board requirements within which agencies must operate to meet their obligations under the FA Act; 

•	the financial management framework is underpinned by concepts of "efficient", "effective", "economical" and "value for money"; 

•	section 61 of the FA Act requires "the accountable officer or statutory body to achieve reasonable value for money by ensuring the operations of the department or statutory body are carried out efficiently, effectively and economically"; 

•	section 11 FPMS requires agencies to "establish and maintain management systems for efficiently, effectively and economically managing their financial resources"; 

•	the HHS is required to deliver the health services outlined in the Service Agreement for which funding is provided. Service Agreements are established with each HHS under the National Health Reform Agreement; 

•	The Performance and Accountability Framework uses Performance Measures to measure the extent to which HHSs are delivering the high-level objectives set out in the Service Agreement.  The Service Agreement contains KPIs and other measures of performance against which the HHS will be assessed. 

•	Under the WBHHS Service Agreement the relevant KPI states 'Efficient – available resources are maximised to deliver sustainable, high quality health care; avoid waste; minimise financial risk, maximise available resources, sustainable/productive, average sustainable Queensland Health FTE, Capital expenditure performance"; and

•	The decision letter does not factor any specific austerity measures nor measures focussed on savings, including those as a result of the economic impacts due to COVID-19, for example the "Responsible Workforce Management – Queensland Health approach'. 

[33]	It is disputed that it is a 'superficial concern' within any staffing budget provision, as to whether wages for a staff member come from a 'permanent' or 'casual' line item.  This is because you cannot have more than one person against one position. 

[34]	'Superficial' implies that the issue of funding a new role is unimportant, or insignificant.  The Chief Executive is required to deliver sustainable, efficient, economical, appropriate resourcing within a framework of accountability underpinned by numerous legislation which is neither unimportant nor insignificant. 

Conclusion

[35]	The Department says it has evidenced genuine operational requirements not to convert the Appellant. The reasons are not trivial. 

[36]	The Department says that the decision is not inconsistent with either the stated purpose or the principles of the Directive. 

Ms Deverge's submissions in reply

[37]	Ms Deverge does not dispute that the work previously undertaken could be done on a temporary or casual basis.  However, she says that the issue is not whether it was appropriate to initially employ her on a casual basis, but whether that should continue. 

[38]	When considering the 'nature' of any employee's engagement, a decision maker must consider the nature of the employment as a whole.

[39]	It is assumed that by this time, the Respondent would have decided whether Ms Deverge is worthy of a continuing role within the agency.  As evidenced by the Respondent's own attachments, they have ceaselessly renewed Ms Deverge's 'contracts' throughout her service, and by doing so, acknowledge her ability to fulfill a range of duties and roles within the agency.

[40]	Despite being a casual employee, Ms Deverge already takes periods of leave, albeit unpaid, Ms Deverge's position is nonetheless backfilled by another employee during her absence.  The assertion that the Department must engage another casual or temporary employee to backfill the ongoing leave of Ms Deverge should she be converted is inherently flawed.

Genuine Operational Reasons

[41]	Ms Deverge says that the decision in Holcombe is not relevant in this matter as it addresses appointment of a public service employee to a higher classification level and is not comparable to the Casual Employment Directive.

[42]	With regard to the Department's submissions concerning the financial management framework and performance and accountability frameworks within which decision are made, Ms Deverge says that complying with Queensland Government Directives should form an integral part of any Chief Executive's financial management framework and planning.  They are responsible for the budgeting and costs associated with complying with Queensland Government Directives. 

[43]	The Casual Employment Directive supersedes the previous Directive.  The Department, like all other agencies, has had almost four years to evaluate the number of casual and temporary employees who will be eligible for conversion within the proceeding 12-month period. The Chief Executive is responsible for planning their budgetary allocations, backfilling requirements etc. in consideration of those numbers. 

[44]	Ongoing changes to the casual and temporary pool in accordance with Queensland Government Directives should be foreshadowed by agencies, all relevant Departments and their Chief Executives. 

[45]	While unemployment may be low in service industries, underemployment and underutilisation rates for its workers is high. Job insecurity is a constant cloud that has affected the Appellant's ability to plan for her future, provide for her family, and fully engage in her local economy. 

[46]	Giving workers such as Ms Deverge the right to request permanency is arguably redundant is Chief Executives within Queensland Health can proclaim to rely on 'no budgeted vacancies' and 'a workforce strategy' as genuine operational requirements. 

[47]	Ms Deverge maintains that the Respondent has failed to evidence any genuine operational requirements or reasons for their decision. 

Consideration

[48]	I note that the Respondent's submissions state that Ms Deverge meets the merit requirement for conversion and that it has been assessed that there is an ongoing need for her to be employed for the types of circumstances set out at cl 5.2 of the Directive which describes circumstances which make tenured or fixed term employment 'generally not viable or appropriate'. Relevantly, the clause states:

'Use of tenured or fixed term temporary employment is generally not viable or appropriate where there is a need for short term employment, or to meet unpredictable, irregular or variable demand or in emergent situations…'.

[49]	Clause 5.3 of the Directive goes on to state that:

Employment on tenure may be viable or appropriate if a person is required to be employed for a purpose mentioned in clause 5.2, such as covering gaps in various work rosters, on a regular and systematic basis.' 

[50]	With regard to whether Ms Deverge has been employed on a 'regular and systematic' basis, the submissions of the respondent describe Ms Deverge's works as being to 'cover in roles where the incumbent position holder has been temporarily absent due to recreation leave, sick leave, QSuper, training, graduated return to work, WorkCover, secondment or short-term increase in workload etc.' There has been a pattern of engagements on a regular basis in place over a period of time and an ongoing reliance on Ms Deverge's services.  

[51]	With regard to cl 5.2 of the Directive, Ms Deverge's ongoing casual employment could not be said to be 'short term' in nature.  She was engaged on 17 September 2018 and was continuing to be employed at the time of the review in October 2020.  Similarly, if Ms Deverge is being engaged 'to meet unpredictable, irregular or variable demand or in emergent situations…', it means that such unpredictable situations occur on a regular enough basis to mean Ms Deverge has been required to be employed. 

[52]	I am satisfied that Ms Deverge has been employed in a regular and systematic way.  

[53]	The HHS refers to the decision in Holcombe. I agree with Ms Deverge that that decision addressed a different part of the PS Act and a different set of circumstances.  In the current case, Ms Deverge is regularly employed to replace a number of people who are away from their regular position for a range of reasons at any one time.  It is not the case that if Ms Deverge is made permanent there will be two people employed in one position.  

[54]	Having established that Ms Deverge meets the merit criteria, and that there is an ongoing need to employ her, the decision maker went on to determine that converting Ms Deverge's employment to tenure was not viable or appropriate having regard to genuine operational requirements. 

[55]	The phrase 'genuine operational requirements' is defined in neither the PS Act nor the Directive and must therefore: 

take its meaning from the words used in it and the context in which it appears in the PS Act; and consideration of the context including surrounding provisions, what may be drawn from other aspects of the instrument, the instrument as a whole and it extends to what the instrument seeks to remedy.
…
The adjective 'genuine' relevantly means '…being truly, such; real; authentic.' The phrase 'operational requirements of the department' is obviously a broad term that permits a consideration of many matters depending upon the particular circumstances of the department at a particular time.

[56]	The decision letter and submissions of the Respondent state that the Chief Executive is required to manage the full time equivalent establishment in line with the WBHHS staff cap and budget.  The decision letter states:

There are currently no budgeted vacancies within the area in which you are engaged in the circumstances as outlined in section 5.2 of the Directive, and if I were to convert your employment to permanent, I would be required to create a new permanent position in which to place you which would be above the staffing cap for the WBHHS and without the required budget.

[57]	The Directive does not require there to be a budgeted vacancy to enable conversion.  Converting a person's employment from casual to permanent will often involve the creation of a new permanent position.  

[58]	The Respondent correctly points out that it is necessary for the Chief Executive to work within financial management and performance and accountability frameworks.  Section 25 of the PS Act sets out the management and employment principles for the public service in Queensland. The section requires the management of public resources in an efficient, responsible and fully accountable way. However, that same section also states that public service employment is to be directed towards promoting employment on tenure as the default basis of employment for employees in the public service, other than for non-industrial instrument employees. 

[59]	The implications of conversion set out by the Respondent as genuine operational requirements would apply to many casual conversion decisions where there is not an existing vacant and funded position.  I am not persuaded that the operational requirements of the Respondent precluding the conversion are genuine. 

[60]	For the Directive and relevant legislation to have any real effect in enabling workers in insecure employment to request conversion following the requisite time periods of continuing employment, it will be necessary for Departments or in this case, hospitals and health services, to make adjustments to their staffing allocations, budgets and workforce planning.  

[61]	The decision not to offer Ms Deverge permanent employment as a general employee on tenure was not fair and reasonable in the circumstances. 

[62]	Pursuant to s 562C(1)(c) of the Industrial Relations Act 2016, the decision appeal against is set aside and substituted with a decision that Ms Deverge's employment is to be converted to permanent.