There is a substantial obligation on the employer to
place an otherwise redundant employee elsewhere in its
organisation, including within associated entities if it wishes to
avoid an unfair dismissal claim.
Employees are unable to make an unfair dismissal application
when the dismissal is a "genuine redundancy". Section 389
of the Fair Work Act provides that a redundancy is genuine
the employee's job is no longer required to be performed
by anyone because of operational changes in the employer's
the employer has complied with any obligation to consult about
the redundancy in a relevant industrial instrument.
Since then, a Full Bench of Fair Work Australia
(FWA) has further clarified the employer's
obligations in redundancy situations (Ulan Coal Mines Ltd v
Honeysett & Others; Murray & Ors v Ulan Coal Mines Ltd
 FWAFB 7578).
Timing and relevant matters
The question whether redeployment is reasonable is to be applied
at the time of dismissal. Relevant matters include:
the nature of the available alternative position;
the qualifications required to perform it;
the employee's skills experience and qualifications;
the location of the position in relation to the employee's
the remuneration offered.
What is a "suitable job" for redeployment?
It is one which the employee has the skills and competence to
perform to the required standard, either immediately or with a
reasonable period of retraining.
Redeployment requires the placing of an employee into
An essential part of the concept of redeployment is that a
redundant employee is placed in another suitable job in the
employer's enterprise (or an associated one) as an alternative
to termination. Advertising a suitable alternative position and
requiring the employee to apply and compete with other applicants
for the position might subsequently lead to the dismissal being
found not to be a genuine redundancy.
Redeployment to associated entities
The "degree of managerial integration between the different
entities" will be relevant. If the employer is part of a group
of associated entities which are all subject to overall managerial
control by one member of the group, then subjecting a redundant
employee to a competitive process for an advertised vacancy in an
associated entity may result in a finding that the employee was not
Alternatively, if the associated entity operates as a
stand-alone operation and, for instance, has its own enterprise
agreement with its own redeployment processes, then lesser steps
may be required in attempting to redeploy into that associated
What does this mean for employers?
There is a substantial obligation on the employer to place an
otherwise redundant employee elsewhere in its organisation,
including within associated entities, if it wishes to avoid an
unfair dismissal claim.
Long experience representing many of Australia's leading employers has taught us that in employment litigation the identity of an employee's representative is a major factor in how employee litigation runs.
Australian employees receive certain entitlements (such as annual leave and superannuation) where contractors do not.
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