Can employee be made redundant on parental leave?

Q&A

Can employee be made redundant on parental leave?

Employees on parental leave are not excluded from redundancy, but employers should be careful to fairly implement redundancy in such a circumstance.

WantToReadMore

Get unlimited access to all of our content.

Employees on parental leave are not excluded from redundancy, but employers should be careful to fairly implement redundancy in such a circumstance.

This question was recently sent to WorkplaceInfo.

Q  Due to a downturn in business, we have had to make a section of our workforce redundant.

One employee is currently absent on parental leave.

There is no other suitable position available for this employee, although the company has consulted with the affected employees regarding options or redeployment as required under our enterprise agreement. 

Because of the provisions of the National Employment Standard (NES) that refer to a return-to-work guarantee, our concern is whether an employee can be terminated in this circumstance when absent on unpaid parental leave. Is the employee’s position protected from termination due to redundancy if she is absent on parental leave (in this case maternity leave)?

A  The unpaid parental leave provisions under the NES do not operate to quarantine an employee from the effects of a genuine redundancy occurring during a period of unpaid parental leave, as long as the termination is otherwise properly and fairly carried out.

Relevant factors
 
The company would need to have applied selection criteria for redundancy that are based on objective factors, referring to the skills, qualifications, training, performance, etc, of the individual(s) compared to the current and future needs of the company.

These factors should be made known to the employees in advance (through consultation).

In a matter before the (then) Australian Industrial Relations Commission, the applicant argued that because her original position had become redundant she was entitled to the position the employee held immediately starting unpaid parental leave or, if that position no longer exists, a position similar in status and responsibility to the original position.

The AIRC determined that the return-to-work guarantee provision under the (then) Workplace Relations Act only applied when the employee returned from unpaid parental leave (s84 of the Fair Work Act 2009 is similarly worded to the Workplace Relations Act) and not during the period of unpaid parental leave. See: Kerrison v Air International Pty Ltd [2006] AIRC 297.

If the employee, however, has been selected for redundancy primarily because of her absence on unpaid parental leave, this would be regarded as discriminatory (s351 of the Fair Work Act — family or carer’s responsibilities) and would expose the company to a potential claim of unfair dismissal or unlawful termination.
 
Post details