Redundancy genuine if no suitable alternative employment as at date of termination
United Petroleum underwent a restructure of its retail management team to mitigate the significant drops to its sales suffered as a result of COVID-19. As part of this restructure, the role of its Retail Store Specialist (Mr Lakhan), was made redundant. There were no suitable alternative redeployment opportunities available at the time of the redundancy.
A little over two weeks later, United Petroleum advertised for a Retail Operations Specialist. The description was akin to Mr Lakhan’s former role.
United Petroleum revealed during the hearing this advertisement was uploaded in error by a “clearly incompetent” person in HR, who had been asked to remove it. At the time of the hearing, the advertisement had not been removed.
A further week later, United Petroleum advertised for a Retail Trainer. Mr Lakhan grew suspicious and applied for this role using his son’s name. His son was offered an interview for the Retail Operations Specialist role (despite the above). Mr Lakhan did not attend the interview.
By this stage, COVID-19 restrictions had eased, and the financial position of the company improved significantly, and United Petroleum offered to re-employ Mr Lakhan in a new role of Retail Site Re-Set Officer. Mr Lakhan did not accept the offer.
The Fair Work Commission held the redundancy was genuine at the time of termination. In reaching this decision, the Commission noted that United Petroleum’s business operations had changed in the short time between the termination and the advertisement for a Retail Trainer, requiring it to quickly adapt.
See Lakhan v United Petroleum [2020] FWC 4970
Lessons
- The Commission will consider whether there were any suitable alternative roles available at the time of termination, in determining whether a redundancy was genuine. So long as the employer can satisfy the Commission no such role was in contemplation at the time of termination, the redundancy will be classified as genuine and an unfair dismissal claim will not succeed. In this case, evidence that United Petroleum had assessed its operating environment and the changes to it was sufficient.
- Attention to detail is critical especially following a restructure involving redundancies. The Commission was very understanding of United Petroleum’s error in posting the wrong advertisement in reaching its decision. This will not always necessarily be the case.
Written by Nes Demir
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