Redundancy and unfair dismissal; failure to consult

The issue whether the dismissal of an employee is unfair, and warranting of a remedy under the Fair Work Act, is guided by various mandatory and express statutory considerations which are found in sec 387 of the Fair Work Act, but remains a matter of “discretion” for the member of the Fair Work Commission who hears and determines the case. In other words the decision must be demonstrably wrong for an appeal to succeed and not just that members of an appeal bench may have reached a different conclusion.

There are many cases, for example where an employer may fail to justify to the Commission that the dismissal of an employee was due to the genuine redundancy of the employee’s job, for example because the employer failed to comply with the mandatory consultation obligations of an applicable modern award or enterprise agreement. Yet the Commission my nonetheless legitimately conclude that the dismissal was not unfair.

On other occasions the Commission may determine that the failure by the employer to consult when required did manifest in an unfair dismissal because if it had done so, the result may have been different.

Here is an extract from such a case. This is the essence of “discretion”.

“Any other matters that the Commission considers relevant – s.387(h)

[37] Section 387(h) provides the Commission with broad scope to consider any other matters it considers relevant.

[38] That the Respondent failed to consult the Applicant about the redundancy is a relevant consideration. This deprived the Applicant and the Respondent the opportunity to consider the matters which might mitigate the effect of redundancy on the Applicant. Amongst these mitigating factors could have been, for example, an examination of the prospect of reducing the Applicant’s hours to more accurately reflect the reduction in workload or the prospect of the Applicant taking a period of unpaid leave.

[39] I also regard the Applicant’s length of service as a relevant matter. At the time of her dismissal the Applicant had completed less than 12 months of service with the Respondent. This is not a significant period of employment by any measure.

[40] I have also taken into account that redeployment into another position with the Respondent or with a related entity of the Respondent is not possible. It is clear that the prospect of redeployment was not discussed with the Applicant. The Respondent submits that there was no opportunity for redeployment as the Applicant’s was not the only position made redundant at the time. 38 The Applicant concedes that there was no position of which she was aware into which she could be immediately redeployed.39 In the circumstances, but for the failure to consult the Applicant, dismissal would otherwise have been a case of genuine redundancy and so would not have been regarded as unfair.

[41] The right to be consulted about a decision to reduce staffing numbers which may impact the ongoing employment of an employee is a substantive right and not merely perfunctory. The Applicant should have been consulted about the proposed redundancy and the consequent employment termination before her employment ended. That the Respondent failed to so do meant that the Applicant was deprived the opportunity of discussing with her employer options to mitigate or ameliorate effects of redundancy on her. Consequently, mitigating options such as reduced working hours or leave without pay were not discussed or considered. Taking all of the matters into account as I have set out above and weighing them, I consider that the dismissal of the Applicant on redundancy grounds without consultation was harsh, and therefore unfair.

Conclusion

[42] For the reasons given, the Applicant’s dismissal was not a genuine redundancy within the meaning of the s.389 of the Act.

[43] The Applicant’s dismissal in the circumstances was harsh, and therefore unfair.”

Duckworth v My Shared Services Pty Ltd (2020) FWC 4865 delivered 4 November 2020 per Gostencnik DP