A recent ruling by Fair Work Australia serves as another warning to businesses to be extremely careful when considering redundancies.
The ruling related to a claim by 5 employees of Specialty Fashion Group who were made redundant last year. Fair Work Australia found that these redundancies were not genuine because the employer had failed to follow the process for redundancies as outlined under the relevant award.
In this particular case the failure of the process came from Specialty Fashion Group’s failure to consult with the employees prior to the decision to make them redundant. And the failure to at least consider whether it would have been reasonable to redeploy the employees within the organisation. The FWA decision seems to indicate that if the employer had undertaken these extra steps properly then it is likely it would have been found to be a genuine redundancy, and prevented the unfair dismissal claim from being able to proceed any further.
In this case, “one on one” discussions were not enough to satisfy the requirement for a consultation. The employees were not given the opportunity to raise matters which may have affected the decision and the evidence showed that the employer was not open to consideration of such issues as selection, redeployment, payments and alternatives to redundancy.
Fair Work Australia has ordered another hearing to find if the terminations were harsh, unjust or unreasonable.
So the take away is to be very careful when terminating employees and in dealing with redundancies.
Disclaimer: The material contained on this website is provided for general information purposes only and does not constitute legal advice. You should not depend upon any information appearing on this website without seeking legal advice. We do not guarantee that the contents of this website will be accurate, complete or up-to-date.