Termination of employment for redundancy

Employers may want to offer an employee a “redundancy package”, because the employee is no longer needed. However, it’s important when making an employee redundant, that it is a genuine redundancy. A genuine redundancy is when an employee is terminated because the employer no longer intends for the person's job to be performed by anyone and the employer has complied with all the necessary steps in any applicable modern award or enterprise agreement to consult with the employee about the redundancy.

If the termination does not meet the above criteria, the employer may risk an unfair dismissal claim. It’s also important to note a redundancy does not remove the requirement for notice or payment in lieu of notice.

Some employers fall into the trap of going through a ‘redundancy’ and then advertising to hire someone for the same position. If you are an employer, you should be aware that an employee is likely to check for advertised positions.

Sometimes an employer will try and terminate a non-performing employee and classify it as a redundancy. This is a risky strategy. If an employee is not performing, then the employer has an obligation to go through a process of communicating the problems, and giving the employee an opportunity to meet the necessary standards. Redundancy is not a shortcut to get rid of unwanted employees.

If you would like advice about how to go about making an employee redundant, or if you have been made redundant and believe that it is not a genuine redundancy, please don’t hesitate to contact us.