Swapping redundant positions

Introduction

Section 389 of the Fair Work Act 2009 sets out the meaning of genuine redundancy. If the requisite requirements of the section are met, this provides the employer with a defence to an unfair dismissal application. One of the obligations under subsection 389(2) is a requirement for the employer to consider whether in all the circumstances it was reasonable to redeploy the employee within:

       (a)    the employer's enterprise; or

       (b)    the enterprise of an associated entity of the employer.

A recent decision on redeployment

In a January 2017 decision, a Full Bench of the Fair Work Commission (the Full Bench) determined that whilst “there is no general obligation for an employer to implement or facilitate a process whereby employees whose positions are redundant can swap with other employees who wish to volunteer for redundancy”, in the facts of the particular case before the Full Bench, the failure by the employer to facilitate a “swap” process resulted in employer having failed to comply with its redeployment obligations under section 389(2).

The Full Bench came to that conclusion by taking into account the following matters:

• the employer is a large business who employed a significant number of employees who undertake the same role as those being made redundant;
• this meant that allowing a swap would not place onerous training requirements on the employer;
• the locations of the employer’s operations meant that swaps could take place in reasonable proximity and therefore the employer was not exposed to any relocation costs;
• the employer had previously allowed swaps in similar circumstances; and
• the employer itself had suggested this as a possible option to mitigate the effects of redundancies.

Lesson for employers

It will be interesting to see if this option of swapping becomes more prevalent in workplace redundancies.

When selecting employees for redundancy and the possibility of swapping employees exists, we recommend employers consider this options particularly when some or all of the factors set out in the decision apply.

If you would like to know more about this case or redeployment generally, please contact National Workplace Lawyers on +61 2 9233 3989.

National Workplace Lawyers

Note — this is for information purposes only and does not purport to be comprehensive or to render legal advice.