Consultation is not required when an employee is award free

Consultation is not required when an employee is award free

A recent Fair Work Commission decision has highlighted the considerations Australian businesses must undertake in reviewing their staff levels, an all too common necessity in the pandemic era. It also clarified the requirements for consultation when selecting employees for redundancy who are not covered by an award or enterprise agreement.

The case involved an employee engaged as a Marketing Coordinator with ACS Property Services (ACS), a Melbourne based company that provides cleaning, maintenance and facility management services. The employee had commenced with ACS on 24 September 2019. Due to significant reductions in earnings following the pandemic, the employee was dismissed due to redundancy. At the time of the dismissal, ACS employed 316 staff.

The Managing Director gave evidence that he met with the employee via a Zoom meeting on 19 June 2020. He advised the employee that he was considering terminating his employment on the basis of redundancy. A follow-up telephone conversation took place on 21 June 2020 and, after considering the views of the employee, decided to proceed with the dismissal, which was confirmed in a letter dated 25 June 2020. The letter identified that his position was no longer required as a result of an organisational restructure linked to the cancellation of trade shows and other events.

The employee claimed that other duties and positions were available to him or that he could have remained working on reduced hours.

In his decision, Deputy President Masson provided a useful guide to follow to ensure a redundancy is indeed a `genuine redundancy’, noting:

  1. A job is a collection of functions, duties and responsibilities assigned to a particular employee within an organisation;

  2. The functions, duties and responsibilities may cease to be part of an employee’s job through a reorganisation or redistribution of duties;

  3. Should there no longer be any functions or duties to be performed by a particular employee, then his or her job ceases to exist;

  4. The fact that the tasks and duties previously performed by an employee may have survived and reallocated to other employees through a restructure does not mean the job is still required;

  5. An employee’s dismissal may be a genuine redundancy even though particular functions, duties and responsibilities previously performed by that employee are being performed by other employees.

In the case, Deputy President Masson determined that the role of Marketing Coordinator was no longer required, and therefore, the termination constituted a genuine redundancy.

A further issue considered by Deputy President Masson was whether ACS was required to comply with the consultation provisions of section 389(1)(b) of the Fair Work Act 2009 (the Act). After reviewing both the Cleaning Services Award 2020 and the Clerks – Private Sector Award 2020, he determined that the employee was effectively `award free’ and consequently, the Act provisions did not apply.

Mr OK vs ACS Property Services [2020] FWC 5952 (11 November 2020)

For queries about redundancy, or other employment questions, please contact Dean Cameron at Workforce Advisory Lawyers – We Know Employment Law on 1300 925 529, 0417 622 178 or via email to dean.cameron@workforceadvisory.com.au

Disclaimer: This information is provided as general advice on workplace relations and employment law. It does not constitute legal advice, and it is always advisable to seek further information regarding specific workplace issues. Liability limited by a scheme approved under professional standards legislation.

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