Your questions answered: Are we obligated to offer redeployment to a retrenched employee?

By Portner Press on April 17th, 2019
  1. Termination of Employment
  2. Redundancy

We are restructuring our HR department as we no longer require one of the roles to be performed, but we do require a new role that we will introduce.

We plan to make the current role redundant and recruit someone into the new role. The size and scope of the new role will be reduced, and the salary will be significantly lower that the redundant role.

Are we obliged to offer the team member in the redundant position the new role?

We intend to recruit externally to find a suitably qualified candidate, and plan to offer either a redundancy package or an opportunity to apply for the new role to the current employee. Will this fulfil our obligations to the redundant employee?

The primary concern in this case is that the employee may lodge an unfair dismissal claim on the basis that the redundancy is not a genuine redundancy. If this occurs, the Fair Work Commission will consider whether or not it was reasonable for you to redeploy the employee to the new role. If it was reasonable and redeployment was not offered, this can mean that the redundancy wasn’t a genuine redundancy for unfair dismissal purposes.

The redeployment obligation extends to what is “reasonable in all the circumstances”. This differs on a case-by-case basis, but generally you should not fail to offer an employee a role that they have the appropriate skills to perform, even if it is lower in status or pay.

Please note that inviting an employee to apply for a position that is subject to a competitive process, i.e. that you are interviewing others for, would not satisfy the redeployment requirement.

Do you have to implement a redundancy?

Learn step by step exactly what to do in our eBook Managing Redundancies.

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