With the economic downturn having intensified in Australia in
the first half of 2009, it is increasingly clear that the Rudd
Government's new unfair dismissal laws will arrive too late to
soften the blow of redundancy for many of those affected. The Fair
Work Bill 2008 is currently before a Senate committee having
already passed the House of Reps in November. However, assuming the
unfair dismissal laws are passed in the Senate (and the Federal
Opposition Leader, Malcolm Turnbull has signified they won't be
opposed) they are not due to come into effect until 1 July
That means employees will have the cold comfort of Work Choices
to mitigate the worst effects of redundancy and retrenchment for
some time yet. Under Work Choices, employees of firms with 100
employees or fewer are totally excluded from the unfair dismissal
jurisdiction of the Australian Industrial Relations Commission. It
is little different for employees of larger firms who can lawfully
claim employment was terminated for "genuine operational
reasons" being reasons of an economic, technological,
structural or similar nature relating to the employer's
business and thereby put the redundancy process beyond the
Under the Fair Work Bill, all employees not earning above
approximately $110,000 per annum will regain access to unfair
dismissal laws provided they have served a qualifying period of 6
months or 12 months in the case of a small business employing less
than 15 employees. There will be an exclusion for "genuine
redundancy" but this will operate much more narrowly than is
currently the position under Work Choices. A genuine redundancy
will only occur if the employer no longer requires the job to be
done by anyone because of changes in operational requirements of
the enterprise, and has consulted about the redundancy as required
under the award or any applicable enterprise agreement. The
employer must also show that it was not reasonably possible to
redeploy the redundant employee in the enterprise in all of the
circumstances. In addition, the new national employment standards
which come into effect on 1 January 2010 will require all employers
to pay severance pay up to sixteen weeks depending on the length of
service. However this will not apply to small business employing
fewer than 15 employees.
Given the wide acknowledgment that Work Choices and, in
particular, the removal of unfair dismissal played a significant
part in the election of the Rudd Government last year, it will be
interesting to see if the unexpectedly long time it has taken to
introduce its own Forward with Fairness policy costs the Rudd
Government at the next election due in 2010. In the meantime, those
unlucky enough to lose their job through redundancy in the first
half of this year may be seriously questioning whether they are
paying the price of a very extensive consultation process. That
process was designed to get the fairness or the balance right
between the employer and employee but perhaps paid insufficient
regard to the need to bring it forward.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
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.
Treasurer Scott Morrison recently announced changes to a number of 2016 Budget superannuation contribution measures.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).