While redundancies are an ordinary incidence of employment, the Fair Work Act affords rights to help those whose role is being made redundant on a genuine basis. However, the law defines genuine redundancy and not all redundancies are lawful.

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Redundancy Pay

In the case of a genuine redundancy, an employee is entitled to redundancy pay if the employee has worked with the employer for at least 12 months and employment is terminated;

  1. at the employer’s initiative because the employer no longer requires to job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or
  2. because of the insolvency or bankruptcy of the employer.

Payment for redundancy may be provided for in an Agreement and a minimum amount is provided for in the National Employment Standards. The amount of redundancy paid to you will also depend on your length of service and “base rate of pay” which includes all regular allowances but excludes discretionary payments such as bonuses, car payments where this amount is expressly excluded.

Not a genuine redundancy

It might be the case that an employer is attempting to unfairly dismiss you under the disguise of a genuine redundancy.

A redundancy is only genuine if:

  • the person’s employer no longer required the person’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise; and
  • the employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.

The redundancy is not genuine if it would have been reasonable in all the circumstances for the person to be redeployed within:

  • the employer’s enterprise; or
  • the enterprise of an associated entity of the employer.

Determining whether a redundancy is genuine is a complex matter. We recommend contacting us you were dismissed on account of redundancy and don’t believe it to be a genuine case, or if you have issues with your entitlements that come with a redundancy.