The Full Bench of the Fair Work Commission recently considered the extent of “consultation” requirements under a Modern Award in relation to a redundancy. The Full Bench found that the  relevant consultation obligations did not extend to providing an employee with an opportunity to change the employer’s decision on redundancy.  The Full Bench vindicated an employer’s dismissal of an Australian project manager on redundancy grounds. This was despite the employee having been given only one day’s advance notice of the decision.

In an effort to shed 100 positions globally following a downturn in business, the employee was among 9 others made redundant in the Asia Pacific region. The employee was notified of the decision on 1 July 2013 and was retrenched the following day (having been given the night before to consider any information he might wish to raise at the next day’s meeting).

The appeal turned on whether the employee’s dismissal was a genuine redundancy under s389 of the Fair Work Act 2009 (Cth). In overturning the first instance decision, the Full Bench held that there was no basis to conclude that the employer had failed to comply with relevant consultation provisions under the Professional Employees Award 2010. The consultation provisions required the employer to  discuss with the employee its decision to make him redundant “as early as practicable” after it had been made. The Full Bench placed emphasis on the employer’s uncontested evidence that its contractual obligations regarding confidentiality of client data meant that it could not hold discussions with the employee before 1 July 2013.

The Full Bench also held that, in giving the employee an opportunity to consider his circumstances overnight and provide the employer with any additional information to consider the next day, the employer had complied with its award obligations regarding consultation. Contrary to the first instance decision, the Full Bench said that the employer was not required to provide the employee with an opportunity to change its decision in order to comply with the consultation provisions in the Award.

Despite conceding that the employer had failed to give “prompt consideration” under the Award to the employee’s proposal that he could fulfil available overseas positions, the Full Bench accepted that international relocations for this employer were more the exception than the rule. The Full Bench also said that the employee could have no reasonable expectation that international relocations were available where the employer had “no established or articulated policy for overseas redeployment in redundancy situations“.

Despite this case suggesting that Courts may not read s389 of the Act as requiring employers to redeploy redundant employees to any vacant position, courts will ultimately consider each redundancy situation on a case by case basis. Therefore, employers should exercise diligence to ensure that they are meeting all obligations with respect to redundancy (statutory, award-based or otherwise).

Ventyx Pty Ltd v Murray [2014] FBFWC 143 (29 April 2014)

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