Genuine redundancy unchanged by new laws

Cases

Genuine redundancy unchanged by new laws

Fair Work Australia has confirmed that the 2007 landmark ruling on genuine operational reasons for dismissal is unaffected by the introduction of the new industrial relations laws.

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Fair Work Australia has confirmed that the 2007 landmark ruling on genuine operational reasons for dismissal is unaffected by the introduction of the new industrial relations laws.
 
In Carter v Village Cinemas Australia Pty Ltd, the AIRC ruled that a manager was sacked legally by the Village Roadshow company, after 19 years of service, because the Melbourne theatre complex he ran had been demolished.
 
This in effect meant employers could sack employees for operational reasons without taking ‘harshness or unfairness’ into account.
 
In the present case, two former employees of United Petroleum Pty Ltd were made redundant as a result of ‘operational changes’ being made.
 
However, they argued it was a ‘sham’ redundancy, really related to an allegation of a theft of the managing director’s wallet, after they had refused to undergo a lie detector test.
 
Redundancies not a sham
 
Commissioner Greg Smith found both employees redundancies were genuine — one due to a relocation of job role and the other due to cut-backs.
 
Smith noted that the Explanatory Memorandum of the Fair Work Act 2009 ‘makes clear’ that operational reasons include circumstances where the employer is restructuring their business to improve efficiency and the tasks done by a particular employee are distributed between several other employees, and therefore the person’s job no longer exists.
 
‘From this it appears clear that the legislature did not intend to alter the authority found in Carter v Village Cinemas Australia Pty Ltd,’ Smith said.
 
The worker’s claims were dismissed.
 
 
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