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Terminating an employee for a redundancy when there is no genuine redundancy is unfair dismissal in Western Australia

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For an employee to be dismissed for redundancy, there must be a genuine redundancy. There is a genuine redundancy when the position no longer exists because of some restructuring. The employee who is to be made redundant must be consulted about the redundancy and earnest efforts must be made to redeploy the employee in some equivalent position in the company. Notice and redundancy pay must be given to the employee. When these requirements are not met, the dismissal for redundancy is unlawful. The case of Churuui Hu v ACY Capital Pty Ltd [2019] FWC 1635 (19 March 2019) illustrates these principles.

An accounts officer had been working for a financial services company. She went on annual leave at the same time the financial services company merged with another financial services company. When the accounts officer returned to work after three weeks, a new employee was sitting at her desk and all the personal items on her desk had been removed.

The accounts officer was told that before she left for her holiday, the company had acquired another financial services company.  Because of the merger, new employees from the company they absorbed had to be accommodated into their office.  Now that all the positions have been filled, the accounts officer was no longer needed. She was paid one month’s salary and she was told that she was terminated.

Consequently, the accounts officer filed an unfair dismissal charge asserting that under the Banking, Finance and Insurance Award 2018, she should have been consulted and efforts should have been made to find an alternative deployment for her in the company before she was terminated.

In its defense, the financial services company asserted that the negotiations for the acquisition of the other company was confidential and consulting with the accounts officer would have required the company to provide her confidential information.

The Fair Work Commission found that the discussion and consultation with the accounts officer need not involve any confidential information. However, the law and the Award required the company to discuss with the accounts officer the ways in which the acquisition may affect her employment. She should have been notified before she was made redundant.

When the accounts officer was terminated, she inquired if she could be redeployed in some other position. Her redeployment was not even considered by the company. At that meeting where she was terminated, the accounts officer was not even given the opportunity to be accompanied by a support person of her choice. Lastly, she was not given six weeks’ pay in lieu of notice and four weeks’ redundancy pay. These circumstances make the dismissal unlawful. The Fair Work Commission awarded the accounts officer $7690.