Employee rights
Anna Ford, associate at Sydney law firm Coleman Greig, says there are three basic elements to a genuine redundancy.
First, under all modern awards and enterprise bargaining agreements, the employer must explain why each employee is being made redundant. They have to explain their weakened financial position, even at the risk of compromising their business.
Second, an employer cannot refill a position that has been made redundant. If a redundant employee discovered a replacement was doing their job, the decision could be challenged.
The third component is redeployment. If no genuine attempt is made to redeploy staff, the redundancy decision is likely to be contested.
“When employers ask me to handle redundancy cases, I always go through these three points with them,” Ford says. “If they can’t satisfy them, then the redundancies are not legitimate.”
While many employees regard redundancies as callous, they are usually a last resort for an employer. In announcing redundancies it is virtually certifying its own business failures.
Pacific Brands is a case in point. The company has shed an estimated 3000 jobs since it announced a controversial restructuring plan in early 2009, as part of a shift to manufacturing from China. The company, which markets more than 30 popular apparel brands, including Berlei and Bonds, became a lightning rod for community fury about Australian businesses shifting jobs offshore. In 2009, among Pacific Brand’s one-off expenses was almost A$82 million in redundancy payments.
How to minimise the pain of redundancies - INTHEBLACK