Steps to Avoid a Claim

Failure to follow these steps may allow a former employee to make a claim to the Fair Work Commission for unfair dismissal.

Consider the following:

1. Document that the redundancy is legitimate. A position is only redundant if you no longer require the position to be undertaken by any employee. Clearly document the workplace changes that you are bringing into effect to evidence how and why the employee’s position is no longer required within your Practice. Also note:

• Termination of a position for reason of redundancy must not be used as a means of performance management.
• If a re-division of responsibilities means that a position requires a more advanced skill set than is currently possessed by the employee, consider if it is reasonable to provide further training for the employee.

2. Prior to making a definite decision of redundancy, you must consult with the affected employee. This includes:

• Notifying the employee in writing of the proposed change and the effect that this is likely to have on his/her position.
• Considering whether there are any available positions within your Practice to which you could re-deploy the affected employee.
• Organising a meeting with the employee as early as practicable to discuss the potential redundancy of the position and suggest any potential opportunities for redeployment. Offer the employee the option of bringing a support person to the meeting.
• Allowing the employee to ask questions or provide suggestions regarding redeployment into other positions within the Practice or associated Practices.
• Providing all of the above information in writing including the changes, the effect on the employee’s position, measures discussed between the employer and the employee about ways to avert or mitigate any adverse effects, and further consideration undertaken by the employer in response to the discussion.

When conducting consultation with an Employee you can refer to ClinLegal’s course on Workplace Change: Managing Consulting Obligations for more information.

3. Take full consideration of whether it would be reasonable for the employee to be re-deployed into another position within the Practice or associated Practices. Are there any vacant positions as a result of the restructure within the Practice? If your business has more than one Practice location or office, do they have any available positions? When considering redeployment, you should aim to find a position that is similar to the position already being undertaken by the employee. Consider:

• The suitability of another position in terms of the employee’s current skills and competency (is it reasonable to provide the employee with additional skills and training to be able to perform in another position?);
• The location of any potential position in relation to the employee’s residence;
• The remuneration offered under the employee’s current position in comparison to the potential position.

Clearly document that you have considered potential redeployment options and state the reasons why it is not reasonable to redeploy the employee into another position.

4. Provide the employee with all employee entitlements and redundancy payments (if applicable). Make note of any additional redundancy entitlements that may be contained within the workplace awards or enterprise agreements. Ensure that the employee is paid:

• Any payments of unused annual leave;
• The period of notice of termination (or payment in lieu);
• Redundancy payment (if applicable), calculated on the employee’s ordinary hours of work for a calculated pay period based on the following amount of service with the Practice:

NOTE: There are exceptions to the obligation to make a redundancy payment. Small businesses are generally not required to make a redundancy payment (unless otherwise agreed), and redundancy payment is not payable to an employee who has worked for the employer for less than 12 months.