Is it a Genuine Redundancy?
There are many questions that people ask around the issue of redundancy but the one that comes up the most often is I have been made redundant, can they do that? With everything that has happened to the economy businesses are looking at ways to innovate. One possible innovation is to maintain business momentum by restructuring.
The Fair Work Act 2009 (CTH) (“FWA”) provides criteria that need to be met in order to meet the requirements of a genuine redundancy. The criteria are found in section 389 of the FWA provides that a redundancy will be genuine if the following conditions are met:
- the employer no longer requires the person’s job to be done anymore because of changes in the operational requirements of the employer’s enterprise;
- the employer has complied with its obligations under the modern award or enterprise agreement; and
- there is no reasonable opportunity for the employee to be redeployed within the employer’s enterprise.
It is the job or role that is redundant not the employee. Some examples of changes to an enterprise’s operational requirements are:
- a machine is now available to do the job performed by the employee;
- the employer’s business is experiencing a downturn and therefore the employer only needs three people to do a particular task or duty instead of five; or
- the employer is restricting its business to improve efficiency and the tasks done by a particular employee are distributed between several other employees therefore the person’s job no longer exists.
There are further requirements under the FWA for example where 15 or more employees are dismissed for reasons of economic, technological, structural or similar nature, the employer must give notice to Centrelink. Which must be done as soon as practicable after the decision to terminate is taken, before dismissing any employee in accordance with that decision.
In addition to notifying Centrelink the Fair Work Commission may intervene after an employee has decided to retrench at least 15 workers, if it believes that there has been inadequate consultation with any registered union which the worker belongs to.
If you find yourself in a situation where you have been given notification of redundancy and do not feel that it is genuine then it is important to remember that the Fair Work Commission has strict time limits on making an application under the FWA.
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