Right way redundancy

Employment law expert and principal Tim McDonald from McCabe lawyers said a company is entitled to make employees redundant for operational reasons but, they have to do it the right way.

This usually includes consulting affected employees, considering reasonable redeployment opportunities, and giving a period notice (or payment in lieu).

Terminating an employee legitimately for redundancy while on holidays, is unlikely to be unlawful. “However, the fact that the employee is on holidays may be a mitigating factor that could be taken into account in the consultation process.”

If a redundancy is not genuine, or an employee is selected for redundancy for a discriminatory or other unlawful reason, they may make a claim to the Fair Work Commission for unfair dismissal or a breach of the general protections set out in the Fair Work Act.

Employees would be wise to engage in the consultation process about workplace changes constructively. “They’re entitled to discuss measures to avoid or mitigate the adverse effects of workplace changes, such as redundancy, and their employer must promptly consider those measures,” McDonald says.

Loading

Redundancy signs

Susan Sadler, chief executive at Red Wagon Workplace Solutions adds redundancies can happen when a new technology is being introduced, organisational restructures, or business slowing due to poor sales.

“Sometimes it’s obvious to an employee that their role is at risk of a redundancy, but not always because there’s usually a lot of commercial and financial information that contribute to the decision-making, which employees would not have daily visibility of,” she says.

Any concerns about changes in the business, the best strategy is to speak to a manager and ask them directly if there will be redundancies. A genuine redundancy and good process is one where an employee is treated with kindness and respect.

“In my experience, no one is to blame for a genuine redundancy. It’s a result of fundamental changes in business operations. They are stressful experiences for all – the manager delivering the news, the employee impacted, their families, and their colleagues who are left behind.”

Sadler adds, the following steps are considered to be a genuine redundancy.

• When a person’s job doesn’t need to be done by anyone, the employer is required to follow the consultation requirements that are outlined in the Award or Enterprise Agreement that applies to the impacted employee.
• The purpose of the consultation process is for the employee to have the opportunity to comment on the proposed changes and suggest reasonable alternatives. They can also identify other roles in the business that they could be transferred into.
• If a position vacancy exists in the organisation that an employee could reasonably do, they should be offered the opportunity to redeploy into that role rather than be dismissed.

Extra support can be offered, regardless of whether it’s financial, additional time off, or access to counselling or career services.