Redundancy Series: Redeployment

When considering and implementing redundancies, it is critical that employers understand the applicable processes to implement redundancies and best protect the business from claims. Getting redeployment right is essential to defeating an unfair dismissal claim.

In the fourth part of this redundancy series, we set out the key principles of redeployment. As noted in our first article, the third limb to a genuine redundancy under the Fair Work Act 2009 (Cth) (the Act) requires the person to be redeployed within the employer’s enterprise (or the enterprise of an associated entity of the employer) where it would have been reasonable in all the circumstances to do so. Employers must understand the nature of the redeployment obligation and the ways in which it differs from recruitment processes.

The redeployment obligation

The redeployment obligation in s 389(2) of the Act provides that, even if the first two limbs of a “genuine redundancy” are met, an employee’s dismissal will not be a case of genuine redundancy if, at the time of the dismissal, it would have been reasonable in all the circumstances for the person to be redeployed within the employer’s enterprise or the enterprise of an associated entity of the employer.

Whether or not the redeployment of the employee is reasonable in all the circumstances requires a consideration of all the relevant circumstances existing at the time of the dismissal.[1]

In the recent case Ken McShane v Port Of Newcastle[2], Deputy President Saunders summarised the relevant matters considered by the Full Bench in Ulan Coal Mines Limited v Honeysett[3] in considering whether redeployment was reasonable in all the circumstances, as follows:

(a) whether there exists a job or position or other work to which the employee can be redeployed;

(b) the nature of any available position;

(c) qualifications required to perform the job;

(d) the employee’s skills, qualifications and experience. The employee should have the skills and competence required to perform the role to the required standard either immediately or within a reasonable period of retraining; and

(e) the location of the job in relation to the employee’s residence and the remuneration which is offered.”[4]

In addition to the matters above, “the degree of managerial integration between the different entities is likely to be a relevant consideration”[5] when considering whether an employee can be redeployed into an associated entity.

The above shows that the employer is not required to create a new role into which an employee can be redeployed. However, the employer can also not require the employee to apply for an existing role in the same way they would for new recruits. Instead, the employer must consider whether it can directly place the employee into an existing role, even if that means that the employee will need some additional training.

The DLA Piper employment team has extensive experience in assisting employers with the redundancy process. Please don’t hesitate to reach out to our team who would be more than happy to discuss this topic with you.

[1] Ulan Coal Mines Limited v Honeysett [2010] FWAFB 7578.

[2] [2019] FWC 177.

[3] [2010] FWAFB 7578.

[4] Ken McShane v Port Of Newcastle [2019] FWC 177, [34].

[5] Ulan Coal Mines Limited v Honeysett [2010] FWAFB 7578, [27].