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Perspective

Lack of consultation results in employee receiving JobKeeper

Nina Hoang
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Another case demonstrating the costs for employers undertaking perfunctory consultation rather than engaging in a genuine and meaningful consultation process.

An Administrative Assistant was made redundant from a professional financial services partnership. The firm held two ‘town hall’ meetings with staff letting then know they were considering measures to ensure the financial viability of the business. Subsequently, the partners made a decision to reduce hours of administrative staff and make some employees redundant. Later that same day, the partners held a meeting with the employee to let her know that changes were required of her team and informed her that they selected her position for redundancy as their calculations revealed she would receive a higher income receiving JobSeeker. She was made her redundant at the end of the meeting.

The employee lodged an unfair dismissal claim asserting a non-genuine redundancy.

Deputy President Sams noted the following issues with the consultation process:

  • Information on changes were not provided in writing;
  • There was no consultation discussions with all affected staff, as earlier discussions were had before a ‘definite decision’ had taken place;
  • No discussion of measures to avoid or reduce the adverse effects of the changes on her;
  • Failure to offer option to reduce hours as was offered to all other administrative employees;
  • “merely asking employees whether they have any questions, comments or suggestions” does not amount to genuine consultation; and
  • Suggesting the employee would be better off financially if she was made redundant so she could pursue JobSeeker did not accord with purpose of consultation and suggests a decision had already been made.

Failure to adhere to consultation obligations resulted in a non-genuine redundancy and therefore her dismissal was deemed harsh and unreasonable. Deputy President Saunders determined the employee would have been eligible for JobKeeper if she remained employed up until the office she had been working in was closed down. As a result he made orders to grant her compensation equal to the JobKeeper amount she would have received.

Key Takeaways

  • As soon as there is a definite decision – consult with every employee that will be affected by the decision (even the ones who are unlikely to be made redundant) – consultation obligations under the Awards require any employee who will be affected in any way to be notified (for example they might need to undertake more work)
  • Always provide employees with a letter outlining proposed changes before undertaking consultation
  • Employers must genuinely consider any possible alternatives or redeployment options that could mitigate the adverse effects on employee – such as working reduced hours or in a lower paid role
  • Employee should also have the opportunity to raise any suggestions and these must be genuinely considered by the employer

Rachael Freebairn v Dandiie Pty Ltd ATF the DM & IT Moore Family Trust, TJL Business Advisors Pty Ltd ATF the Lumtin Family Trust, and Profitwatch Pty Ltd ATF the Rosemark Trust T/A TJL Business Advisors and Accountants [2020] FWC 3915 (27 July 2020)

Nina Hoang
Published:

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