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Redundancy: Is it the job or employee?

An employer may think a redundancy as the 'employee' being redundant.
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Redundancy: Is it the job or employee?

Redundancy: Is it the job or employee?

6 July 2020

An employer may consider a redundancy as the employee being redundant. But in the context of an unfair dismissal application, and where an employer is submitting the circumstance is a case of ‘genuine redundancy’, it is the employee’s ‘job’ that is no longer required to be performed, rather than the employee’s ‘duties’.
 

What does a genuine redundancy look like?


The Fair Work Act (s389(1)(a)) provides that a person’s dismissal will be a case of genuine redundancy if his or her job was no longer required to be performed by anyone because of changes in the operational requirements of the employer’s enterprise.

The Explanatory Memorandum to the Fair Work Bill 2009 provides examples as to when a dismissal will be a case of genuine redundancy.

Item 1548 of the Explanatory Memorandum states that the following are possible examples of a change in the operational requirements of the employer’s enterprise:
 
  • a machine is now available to do the job performed by the employee;
  • the employer’s business is experiencing a downturn and therefore the employer only needs three people to do a particular task or duty instead of five; or
  • 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.
 

What is the ‘job’ then?


This general term has been defined to mean “a collection of functions, duties and responsibilities entrusted, as part of the scheme of the employers’ organisation, to a particular employee.” This definition is usually considered by a court or tribunal in relation to redundancy, and whether the person has any duties left to discharge.

This term is usually important in a case determining whether a “genuine redundancy” has occurred. The reference in the statutory expression is to a person’s “job” no longer being required to be performed.
 
(Then) Fair Work Australia considered whether a dismissal resulting from the restructure of a supervisory team was a case of genuine redundancy. As a result of the restructure, four supervisory team leader positions were replaced by three team leader positions.

The Fair Work Commission determined “when one looks at the specific duties performed by the applicant prior to her termination they have much in common with those of two of the new positions of the new structure".

The test is not, however, whether the duties survive. The explanatory memorandum makes clear that it can still be a ‘genuine redundancy’ where the duties of a previous job persist but are redistributed to other positions. The test is whether the job previously performed by the applicant still exists.

What is critical for the purpose of identifying a redundancy is whether the holder of a former position has, after the re-organisation, any duties left to discharge. If there is no longer any ‘job’, function or duty to be performed by that person, his or her position becomes redundant. This does not mean that if any aspect of the employee’s duties is still to be performed by somebody, they cannot be redundant.
 

Consultation


While the job no longer exists, the Fair Work Act also provides that for there to be a genuine redundancy the employer must have complied with any obligation in a modern award or enterprise agreement to consult about the redundancy.

It is important for an employer to distinguish that it is an employee’s ‘job’ which becomes redundant and not the employee themselves or their duties.

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