Redundant position revived — who to employ?

Q&A

Redundant position revived — who to employ?

Circumstances change and employers sometimes find that positions previously made redundant are now required again by the business. Is there a requirement to re-hire employees previously made redundant in these circumstances?

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Circumstances change and employers sometimes find that positions previously made redundant are now required again by the business. Is there a requirement to re-hire employees previously made redundant in these circumstances?

This question was recently sent to WorkplaceInfo.

Q  We have employees employed at a number of different worksites within metropolitan Melbourne.

Because of a downturn in business, the company has decided to close one of the worksites, with all staff positions on that site being made redundant — with payment of the appropriate severance payments.

As part of the consultation process prior to the positions becoming redundant, the company attempted to find acceptable alternative employment at our other worksites. 

Because there were no such positions available at the time, the employees were subsequently made redundant.

A position at one of the other worksites has now become available because of a resignation.

Are we obliged to offer this position to any of the employees who have been made redundant?

A  There would be no obligation on the employer to re-employ any of the employees recently made redundant if they have already been dismissed, although there could be advantages in re-hiring an employee with previous experience in both the job and having worked for the company.

Consultation process
 
If the employees were still employed when the position at the other worksite became available, the employer may be obliged under the consultation process to offer the position to a suitably qualified employee (if there is such an employee) who may have already been earmarked for termination due to redundancy.

If a modern award or enterprise agreement applies to the employees, then consultation must occur where it is a term of the award or agreement.

If the company is considering re-hiring an employee, it should check whether there is continuity of service with respect to certain employment conditions.

Re-engagement and accrual of leave
 
For example, state and territory long service leave statutes may provide that previous service is taken into account where an employee is terminated by the employer and re-engaged within a certain period (usually two or three months), although there is no such provision in relation to conditions under the standard (ie annual leave, personal/carer’s leave, parental leave).

Tax implications
 
There may also be tax implications for an employee regarding the favourable treatment of their redundancy pay (eligible termination payment) where an employee is re-engaged within a short period after dismissal.

Source: Paul Munro, IR Consultant.
 
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