Employers must be mindful of its obligations under the Fair Work Act 2009 (Cth) (the “Act”) when terminating an employee by way of redundancy.
In the case of Ulan Coal Mines Ltd v Honeysett and others [2010] FWAFB, a mining company dismissed ten employees on grounds of redundancy. Four of those employees claimed it was not a genuine redundancy as Ulan Coal Mines:
- did not make the employees aware of job vacancies within the associated entities; and
- made redundant employees subject to an open selection process for vacancies, which was argued not to be redeployment.
In this case the Full Bench of Fair Work Australia held that an essential part of the concept of redeployment pursuant to s 389(2) (a) of the Act is that a redundant employee be placed into another job in the employer’s enterprise as an alternative to termination of employment. Where an employer decides that, rather than fill a vacancy with an employee into a suitable job in its own enterprise, it will advertise the vacancy and require the employee to compete with other applicants, it might subsequently be found that the resulting dismissal is not a case of genuine redundancy. Furthermore, if an employer is part of a group of associated entities which are subject to overall managerial control, then the same considerations will be relevant when considering if the employer had tried to redeploy an employee.
Tips
When making an employee redundant, consider:
- notifying an employee of other job vacancies within the business or associated entities; and
- offering an employee a position within the business an associated entity, even if the redundant employee has skills and experience beyond those required for the vacant job.
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This article is not legal advice and should not be relied upon as legal advice. All articles found on this website are intended to provide informative information, nevertheless, in many instances legislation and case law has been simplified and/or paraphrased. If you would like personal legal advice based on your current circumstances, you should contact MurdockCheng Legal Practice for a free consultation.