Redundancy requires consultation

Cases

Redundancy requires consultation

As reported previously (see HR Link 30 April 1996), there may be occasions when a redundancy relieves the employer of the obligation to consult with an affected employee as otherwise required by s170DC of the Industrial .

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As reported previously (see HR Link 30 April 1996), there may be occasions when a redundancy relieves the employer of the obligation to consult with an affected employee as otherwise required by s170DC of the Industrial.

However, it is clear that an employer’s failure to take ‘appropriate’ measures, including consultation, to reduce the effect of the redundancy on the employee may render the redundancy in breach of s170DE(2) (a finding that the termination was "harsh, unjust or unreasonable").

For example, Linkenbagh JR stated recently:

"Each case turns on its own facts and the requisite level of consultation will be determined by the particular circumstances. In this case there was no consultation at all, with either the applicant or her Union, as to the re-structuring process, the selection of the applicant for redundancy, or the possibility of redeployment within the respondent’s operations in Queensland. ... It is likely, on the evidence, that consultation with her would not have led to a different result, but it would certainly have afforded her a degree of fairness which is required by Section 170DE(2), and would have reduced the impact of the final decision on her."

Milane JR has similarly stated:

"There is considerable authority in this Court supporting the view that a failure to properly consult with an employee about an impending redundancy as well as the failure to consider alternative employment options and a failure to provide the employee with any counselling or assistance in relation to the redundancy or in relation to obtaining other employment, may render the otherwise lawful termination harsh, unjust or unreasonable... In determining whether a termination was harsh, unjust or unreasonable it is open to the Court to take into account the amounts paid to minimise the effect of the termination on an employee who is leaving through no fault of their own. It follows that the failure to ameliorate the harsh effects of a redundancy through financial or other substantive steps may, in all the circumstances, render the termination a harsh one."

These decisions indicate that in redundancy cases while an employer may be required to consult with affected employees about their conduct or performance, the employer must consult with any affected employee in terms of seeking to minimise the affect of the redundancy. The ways in which the effect of a redundancy may be reduced may include an offer of redeployment, the provision of outplacement services or a substantial financial settlement, etc.

Even having done one or more of these things, the unfortunate reality however of the present federal termination laws is that an employer can never be really sure that they have still done the right thing. As Linkenbagh JR stated above: "Each case turns on its own facts..."

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