Redundancy has on occasion been used as a convenient way to exit unwanted employees.  This can often back-fire with employee’s successfully challenging the dismissal or leaving the organisation open to investigation by the Australian Tax Office (due to the taxation benefits attached to redundancy payments).

However, as “Case 2’ attests, if carried out in a genuine manner, organisations will not be in breach of the FWA.

Case 1[1]

Downer EDI made 106 operator and maintenance employees at Idemitsu Australia’s Boggabri Coal Mine (30% of the mine’s workforce) redundant in early 2013 after deciding to reduce the mine’s operations.

However, two months later, it reversed the decision to wind down operations and the company began advertising for maintenance and operator employees.

Three workers unsuccessfully applied several times but were not re-hired.

Commissioner found that the dismissals were not genuine redundancies, and that the dismissals were also unfair because the company did not try to redeploy them.

Each of the three workers, he argued, had appropriate skills and qualified for the advertised positions but had not been rehired by their former employer, leaving them out of work and out of pocket despite attempts to also find other employment.

He ordered immediate reinstatement with continuity of employment and the reimbursement of lost pay (some $150,000).

Case 2[2]

  • Applicant made redundant after eight months’ work due to restructure
  • Workload distributed to other positions
  • No reason for the Commission to not accept decision-making of employer genuine, as matters entirely within prerogative of employer as bearer of risks
  • Dismissal not harsh, unjust or unreasonable

This decision provides support for job roles to be restructured, with job holder losing their employment.

[1] Mr Justin Fisher; Mr James Davis; Mr Robert Shaw v Downer EDI Mining Pty Ltd [2014] FWC 3382

[2] Grove v Help Enterprises U2013/16788 [2014] FWC 3168

Greg Reiffel Industrial Relations & Human Resources Consulting has been providing the following services to businesses for over 30 years:

 

  • General HR and IR advisory service.
  • Fair Work Commission representation (eg unfair dismissals, adverse actions, etc.).
  • Workplace investigations and mediations.
  • Policies and procedures.
  • Discipline & Termination.
  • People Audits (are you at risk of prosecution?).
  • Enterprise Agreements, Contracts of Employment, Individual Flexibility Agreements.
  • On-site HR services.

Contact Greg on 0438 906 050 or mailto: greg@gregreiffelconsulting.com.au.