May 12, 2024 • 20 mins
Have you ever faced the daunting task of navigating a business's restructuring or pondered the right way to handle potential redundancies?
In this episode, we dig into the complexities of reshaping a company. We're not just talking about the why, but the how—offering strategic insights on realigning roles and departments. From retraining to transferring staff, we dissect the sensitive process of restructuring with a focus on maintaining operations.
We then unpack the crucial notion that it's the role that becomes redundant, not the person, and the importance of a transparent consultation process. We shed light on the legalities involved, particularly when it comes to constructive dismissal and large-scale redundancy procedures. As you listen, you'll gain a deeper understanding of how to stay fair and compliant during these challenging transitions, ensuring your company not only survives but thrives through change.
You can find the show notes for this episode here
Would you like to submit a question to the show? Let us know on our website or via LinkedIn.
Brought to you by Aster HR, the Work Wonders Podcast is hosted by Angela Gauci & Susan Rochester and is recorded at Launch Pad at Western Sydney University.
All information or advice included in this podcast is general, has been developed as a starting point for your business, and should be tailored to your specific requirements. It should not be considered legal advice. We have made every attempt to ensure the accuracy and currency of this information at the time of recording. However, references to things like employment laws are subject to change. For specific advice relating to your business, please get in touch with us.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:06):
Welcome to the Work Wonders podcast brought to you
by Asta HR, where we simplifythe human side of business.
I'm Angela.
Speaker 2 (00:13):
And I'm Susan.
Let's dive into today's episodeand find out what you've been
wondering about.
Speaker 1 (00:21):
In today's episode we're going to talk about
sometimes when things change inyour business and things might
get moved around, which iscalled a restructure.
It might include changingpeople's jobs or who people
report to, or, in some cases,even redundancies.
We'll give you some contextinto when and why it may happen
and then also take you throughhow to do it appropriately.
(00:42):
So let's get started.
This is the Work Wonderspodcast.
Speaker 2 (00:51):
Hi Susan, hi Angela.
Speaker 1 (00:54):
So restructure.
So we're talking today aboutwhen things are getting moved
around a bit like I don't know agame of musical chairs.
Speaker 2 (01:02):
Yes, let's hope it's that much fun.
Speaker 1 (01:06):
So maybe we should start by talking about when this
might happen.
Let's give it some definition.
What would you say?
Speaker 2 (01:12):
Well, there's often times when you need to change
the structure of the businessbecause of external things that
are happening in your businessenvironment.
So, economically, you know youmight need to downsize, but
equally there might need to be aquick increase in numbers in
your business in terms of theemployees and the work that gets
done.
There's also those situationswhere you have to pivot.
(01:36):
Remember that word that becameso popular back in the COVID
days let's all pivot, let's allpivot.
But, yeah, you might bepivoting from one specific area
of your industry into another oreven expanding your remit
across different areas.
Speaker 1 (01:52):
So there's times when it could affect your entire
team, your entire workforce andtimes when it may not.
I'm thinking about an examplewhere you might be a funded
organisation to deliver aparticular service and you lose
that funding with just thatparticular team, not the whole
business just one program.
Let's say and if you lose thatfunding, you no longer have the
(02:14):
need for those positions.
So just those positions alonewould be lost.
Another thing that might triggera restructure is if you have
somebody leave and you decidewell, well, we don't really need
that yeah anymore, for whateverreason yeah or you decide to
shuffle people around into adifferent structure within that
area of the business yep, orlike an amalgamation, if you see
(02:37):
oh look, actually thatdepartment and that department
could work better togetherexactly.
We only really need one managerover that, not two we're going
to get a different role?
Yeah, those sorts of things.
What about location?
If we were opening a new areaor relocating to a different
area?
And perhaps that might needreshuffling who works where and
with whom?
Speaker 2 (02:58):
Okay, so there's a lot of situations where it could
be an issue in your business,right?
Speaker 1 (03:03):
Yeah, the big question from a manager or
business owner might be am Iallowed to do this I think I've
had that said to us before, youknow and is it okay for me to
make that decision to justchange that person's job?
Well, yes, I feel like there'san asterisk to that.
Yes, yeah, that's right.
Speaker 2 (03:25):
See below.
So I guess the biggest concernabout restructuring is
redundancies, Right?
So that's where the risk is,the biggest risk for employers.
I suppose, although I thinkit's useful to look at
restructuring withoutredundancies first.
Speaker 1 (03:47):
Yeah, let's put that out of the way.
Speaker 2 (03:49):
Let's finish off on that first, and then we'll move
on to redundancies.
Speaker 1 (03:53):
Let's do that.
So when you're restructuringand not making people redundant,
that might look like changingsomeone's job description.
Let's say I have a new systemof technology of some kind or a
new piece of equipment that Inow need you to also do, and so
I'm going to be increasing thatand putting that into your job
(04:14):
description.
There you go, that's yours now.
Speaker 2 (04:19):
That sort of thing is not redundancy, that's just
changing things around aroundand now that you're saying that,
I'm thinking well, you couldreally.
You know, in some cases whereyou're changing the reporting
line, that could be arestructure without any sort of
redundancy as well yeah, we'veworked with some clients where a
restructure has meant for them.
Speaker 1 (04:38):
you know reporting lines are changing and so this
position no longer exists, butthis one does, or these two are
amalgamating, or we're nowcalling it something different
and like, if you think of anorganisational chart and you
might have a picture of that inyour head and if that's changing
, that might be a restructure interms of who's reporting to
(04:58):
whom.
Does payroll sit under HR ordoes it sit under finance that
age old problem, that sort ofthing, and you can probably in
some cases get away withoutredundancy, in that it just
might be changing who reports towho.
Speaker 2 (05:12):
Yeah, so that's a restructure.
Dear listener, I wish you couldhave seen Angela's hands, then
what she was saying would havemade a lot more sense.
Speaker 1 (05:25):
Arms going in every direction.
Speaker 2 (05:29):
Okay, let's get serious.
Let's get serious aboutredundancy, because it is a bit
of a scary topic.
Speaker 1 (05:36):
Yeah, yeah, it can be .
Ending anybody's employment canbe a tough one.
Speaker 2 (05:40):
Yeah, so they're under the sort of legal you know
what's right and what's wrongside of things.
The first thing you need todecide before you commence
redundancies is whether it'snecessary or not.
Maybe you could transfer thatstaff member to somewhere else
in the organisation where theycould be used, or you could
retrain them.
Speaker 1 (06:01):
Oh yeah.
Speaker 2 (06:02):
Or simply redeploy them.
So this is something that'sprobably worth discussing with
the people who are going to beaffected.
Speaker 1 (06:10):
Yeah.
Speaker 2 (06:11):
There are rules around consultation, and they
can be quite complex, yeah, sowe're not going to go into them
in detail here, but that's justone aspect of the consultation.
But then, before you even dothat, it's probably worth
considering whether this is agenuine redundancy.
So you, angela, and myselfprobably both experience a
(06:33):
situation where people don'twant to dismiss someone, so I
decide to make them redundant.
Speaker 1 (06:40):
Yeah, unfortunately, it can be something that people
might use to say, oh look, wedon't need you.
Sorry, it's not about you, it'sabout us.
And if it's not genuine.
Speaker 2 (06:50):
What you're getting at there is I'm really hiding
behind the word redundancy, butit's not really redundancy,
that's right, and if it's not agenuine redundancy, you can be
able to do an unfair dismissalclaim.
Yeah.
So what makes a redundancygenuine?
There's two parts.
One is the job doesn't need tobe done anymore, and the second
is that you follow consultationrequirements.
(07:12):
And if you've done both thosethings, or both those things
apply, then the people affectedcan't claim unfair dismissal.
Speaker 1 (07:20):
So the key part you said there was that the job, not
the person.
We don't like you.
You're not performing well,none of that.
You said the job doesn't needto be done Exactly.
So that is really important,because it's that we no longer
need that job in our team.
We no longer need those tasksto be done in that way.
So that is now being exitedfrom that all chart.
(07:42):
We no longer are going to haveanyone doing that work, and
that's actually quite a high barto meet.
Speaker 2 (07:48):
If you think about it , I'd agree.
So what the Fair WorkCommission would look at if
somebody claimed an unfairdismissal due to being made
redundant or the role being maderedundant is does that job
still need to be done?
And the obvious sign of thatwould be that you've given that
work, those tasks, to anotheremployee, or even employed
(08:11):
somebody else to do what thatperson was doing.
Speaker 1 (08:13):
I've got an unfortunate example of that
myself, where a person was maderedundant and told oh look, that
position doesn't exist anymore.
All the best to you.
And then four weeks latersomebody else started with the
word senior in front of theirname, and it was exactly the
same role.
It was just somebody else in it, and so that is definitely an
(08:37):
example of a non-genuineredundancy.
Speaker 2 (08:40):
Yeah, exactly, and I've seen the same thing, but in
reverse, so where a manager X YZ has been made redundant and
then the X Y Z team leader orwhatever has been hired, but
they're actually doing the samePD with a change of name.
So don't do that.
Speaker 1 (08:59):
No, you said consultation as well, susan.
So the rule of thumb there isinclude the employee in the
discussion and give them thereasons why that's happening and
be very clear about the reasons.
Speaker 2 (09:15):
There was one more aspect to judging whether the
redundancy was genuine or not.
Speaker 1 (09:20):
Yeah.
Speaker 2 (09:20):
And that is whether the person could have reasonably
be given another role in theorganisation.
Speaker 1 (09:27):
So that's about going okay.
Well, yes, the business isgoing in this direction, which
means the role's no longerneeded, but we've done what we
could to find where else youmight fit in the team and this
is what we've come up with.
Yep, now, sometimes that mightbe, we had no option.
It might be Other times itmight be.
Actually, if you're willing to,there's this position, if you'd
(09:48):
like to move into that one.
Speaker 2 (09:49):
And then that's back onto the employee and that does
not.
I feel the need to say this,although I wish I didn't.
That doesn't mean saying wedon't have your role anymore at
this pay rate, but we'reintroducing a new role, similar
to what I said with the managerand then team leader, you know.
(10:10):
But we are bringing in a morejunior role and you know you're
welcome to apply for that or wecan redeploy you into that role.
Speaker 1 (10:20):
What you're getting at there is you can't use that
idea of redundancy to disguisewhat you're really doing.
Speaker 2 (10:26):
Yeah, exactly.
Speaker 1 (10:29):
Another thing, Susan, is constructive dismissal.
Now that's a term that you andI are familiar with.
Our listeners might not be butbasically a constructive
dismissal is where the employeeis put in such a position that
they are almost forced to resignbecause the employer has made
(10:49):
the environment of the workplacereally hostile, and an example
might be making work conditionsunbearable, making it really
difficult for them to do theirjob, or giving them no other
option because the job'sshifting or changing or
something they can no longer door be qualified for or whatnot,
forcing them with no otheroption but to resign.
Speaker 2 (11:11):
Yeah.
So the example I gave earlierabout saying we're no longer
having your role, but they'reintroducing a lower level one
which may be reduced pay.
The employee can't afford toearn less.
That would be a constructivedismissal.
Speaker 1 (11:27):
I think yeah, bottom line.
What we're telling you is youneed to be aware of the reasons
that you can terminate someone'semployment and when you can't.
And you know there aredefinitely ways that you can
lawfully do that if you need to,if it's a valid business
decision.
Exactly so.
Another area that can be alittle nervy for business owners
is unfair dismissal andavoiding that action after
(11:48):
terminating someone's employment.
Look, that's another wholeother subject in itself, and
we'll do another episode abouthow to protect yourself from
unfair dismissal.
So look out for that.
Did you know that we have lotsof free resources available to
you on our website, things liketemplates that you could
(12:09):
download, or a checklist for aprocess, or even recordings of
our previous workshops?
If you're looking for help in aparticular area or just some
inspiration, check out theresources page on our website,
astrhrcomau.
And now it's back to theepisode.
Our website, asthrcomau.
And now it's back to theepisode.
Speaker 2 (12:30):
Now let's look at your obligations.
If you're actually going tomake people redundant, okay If
you have 15 or more employees.
Sorry if you're terminating 15or more employees you're legally
required to advise CentrelinkOkay, or Services Australia.
So just something to keep inmind.
(12:50):
Hopefully that's not the casefor most of our listeners, but
just in case, you do need toknow that the next thing you
really need to do is check therelevant awards or agreements,
whatever the industrialinstrument is that covers the
employment of your employees.
In terms of what thenotification is required and the
(13:11):
consultation expectations.
Speaker 1 (13:14):
Some of them can be specific, so that's a good point
, yep.
Speaker 2 (13:18):
It's also worth talking to unions if you have
unions involved in yourworkplace about the proposed
redundancies.
So this will mean that you'renotifying your employees and
also the unions.
Nobody likes a surprise.
Speaker 1 (13:34):
No.
Speaker 2 (13:35):
Especially not before Christmas.
Yeah, Please don't do it.
Speaker 1 (13:39):
Yeah absolutely Right before Christmas.
Speaker 2 (13:41):
Unfortunately that tends to happen a lot in
Australia I've noticed.
Yeah, you will need to contactan accountant because there's
going to be costs involved, yep,so that the accountant can help
you work out what they will behow you're going to pay it.
Speaker 1 (13:57):
There's a whole payout, isn't there?
Yes, you obviously pay thatnotice period that you're
talking about.
Depending on the size of yourbusiness, there might even be a
redundancy pay, so a bit ofextra pay.
There's other things like theymight have leave that need to be
paid out.
Speaker 2 (14:11):
Exactly, and things dependent on the employee's age
at the time of the redundancy,if they're over 45.
So there's a lot of things tobe considered and we can
certainly advise you on whatthose things are, but we'd say,
talk to your accountant aboutwhat it's going to cost you yeah
, because in some cases, ifyou're dealing with an employee
(14:31):
that's been there quite a while,it might be quite a bit oh yeah
.
Speaker 1 (14:35):
Or if you're making that bigger restructure, like
you said, where you're lettingmore than 15 people go, that
would be a big thing as well.
Speaker 2 (14:41):
Exactly.
Always have a look at the FairWork Ombudsman website.
There's lots of fact sheets andthings on there about
particularly about consultationand what needs to happen, what
the minimum requirements are.
We can link to the appropriatepages in the show notes and
we'll do that.
So, while there are theseobligations and the intolerance
(15:03):
that your employees have whenthey're made redundant, always
seek advice.
I'd say yeah, because yoursituation is going to be unique
and it's good to talk tosomebody first to work out the
pros and cons, the ins and outsof restructuring, and if you're
going to be doing it, it'susually a big enough project
that you're thinking about it inadvance.
(15:25):
Exactly.
It's usually a big enoughproject that you're thinking
about it in advance, exactly.
So, speaking of the employees,you want to make it as easy as
possible for them.
Presumably, the restructuringisn't caused by them, so it's
not a punishment for somethingthat they've done.
So you need to be very clearabout why you're doing it and
what your criteria are fordeciding who's leaving and who's
(15:49):
not.
Speaker 1 (15:50):
One of the things that we might help a client
through with Susan in terms ofkeeping employees informed is
again if you're planning thatsort of in advance and you've
got a bit of a piece of work tounderstand what it's going to
look like once you're done, youcould communicate with your
employees throughout thatprocess.
You may not tell themeverything that's okay, no of
course not, but you might youknow.
(16:11):
Let them know we're goingthrough this piece of work
because ABC is coming orsomething, something's lost or
different.
Exactly, let them know, hey,this is happening.
We want to keep you informed.
Do you have any questions, anyideas, any ideas?
And keep them informed throughthe process can be a really nice
way to approach it.
Yeah, what's your thoughts ondoing it in person rather than
(16:33):
over email or phone?
Speaker 2 (16:36):
Well, what do you think?
Of course you'd want to do itin person wouldn't you?
I mean you wouldn't want to.
Most of us wouldn't want to doit in person.
Speaker 1 (16:45):
But it's the right thing to do.
Yeah, I think employees wouldappreciate that.
Speaker 2 (16:49):
Yeah, and then, for your own guidance, be very clear
and consistent about what'sgoing to determine who is made
redundant.
So is it those jobs because wedon't need them anymore, or is
it people with thosequalifications because we don't
need them anymore, or is itpeople with those qualifications
because we don't need themanymore?
Or is it going to be based onlength of experience or whatever
(17:11):
you decide needs to be bothconsistent and fair.
Yeah, yeah that's true.
there are resources that areprovided online in terms of
going through a retrenchmentprocess and, as we discussed, we
can help you with that as well,but we'll be linking to
resources as well.
So we talked aboutcommunicating and communicating
(17:33):
well, but it needs to be enoughnotice given as well, so that
it's not a last-minute shock.
I think we mentioned thatearlier.
Speaker 1 (17:41):
Well, look, that can be it for employees, can't it?
It can be just the shock of itand going oh well, I need a job.
What?
Speaker 2 (17:46):
am I going?
Speaker 1 (17:47):
to do.
So yeah, if you're giving themthat notice, it gives them a
chance to decide what's rightfor them, whether they're happy
to see it out and follow you,depending what's going to happen
, or just wait and see, orwhether they're going to make
another decision to resign orthat sort of thing.
That's fair.
I think, some other nice thingsthat you could do.
You could actually, you know,offer people some additional
(18:10):
support, so by that I mean youmight offer them outplacement
services, which is helping themwith their resume Exactly
Interview skills.
Yeah, that sort of thing, Sortof understanding that, yeah,
look, we get it.
It's tough, you need to gosomewhere else and let's try and
help you.
Speaker 2 (18:26):
And understanding that, yeah, look, we get it.
It's tough, you need to gosomewhere else and let's try and
help you, and that might alsoinclude, you know, helping them
access health and wellbeingservices.
Speaker 1 (18:32):
And, as you said, centrelink as well, or services,
whatever they call themselves.
Now you've got to let them knowwhen you are letting go of more
than 15 people, but you canalso let the employee have a
form for Centrelink if they'rebeing made redundant, so they
can go ahead and do that withouttoo much trouble.
Speaker 2 (18:48):
Start going through that process.
Speaker 1 (18:50):
Yeah, so we hope that episode was helpful for you,
whether you're in a position ofchanges coming up for you in
your workplace or not, justwanting to know what your
obligations are.
We talked about whenrestructure can happen where
there's no redundancy and peoplearen't losing their job, that
(19:10):
things are changing, and thenalso going through the different
areas of when redundancyapplies and when it's genuine,
and how to handle thatappropriately.
I wonder what you got from that.
Please jump on LinkedIn and letus know today.
We always enjoy knowing what'sbeen valuable for you and, as we
said, we'll put all the linksto those relevant documents and
websites on the show notes.
(19:30):
Thanks for listening to theWork Wonders podcast brought to
you by Asta HR.
Hit the subscribe button now tonever miss an episode, and if
you'd like to continue theconversation with us, you can
find us over at astahrcomau.
(19:53):
See you in the next episode.
Welcome to the Work Wonders podcast brought to you
by Asta HR, where we simplifythe human side of business.
I'm Angela.
Speaker 2 (00:13):
And I'm Susan.
Let's dive into today's episodeand find out what you've been
wondering about.
Speaker 1 (00:21):
In today's episode we're going to talk about
sometimes when things change inyour business and things might
get moved around, which iscalled a restructure.
It might include changingpeople's jobs or who people
report to, or, in some cases,even redundancies.
We'll give you some contextinto when and why it may happen
and then also take you throughhow to do it appropriately.
(00:42):
So let's get started.
This is the Work Wonderspodcast.
Speaker 2 (00:51):
Hi Susan, hi Angela.
Speaker 1 (00:54):
So restructure.
So we're talking today aboutwhen things are getting moved
around a bit like I don't know agame of musical chairs.
Speaker 2 (01:02):
Yes, let's hope it's that much fun.
Speaker 1 (01:06):
So maybe we should start by talking about when this
might happen.
Let's give it some definition.
What would you say?
Speaker 2 (01:12):
Well, there's often times when you need to change
the structure of the businessbecause of external things that
are happening in your businessenvironment.
So, economically, you know youmight need to downsize, but
equally there might need to be aquick increase in numbers in
your business in terms of theemployees and the work that gets
done.
There's also those situationswhere you have to pivot.
(01:36):
Remember that word that becameso popular back in the COVID
days let's all pivot, let's allpivot.
But, yeah, you might bepivoting from one specific area
of your industry into another oreven expanding your remit
across different areas.
Speaker 1 (01:52):
So there's times when it could affect your entire
team, your entire workforce andtimes when it may not.
I'm thinking about an examplewhere you might be a funded
organisation to deliver aparticular service and you lose
that funding with just thatparticular team, not the whole
business just one program.
Let's say and if you lose thatfunding, you no longer have the
(02:14):
need for those positions.
So just those positions alonewould be lost.
Another thing that might triggera restructure is if you have
somebody leave and you decidewell, well, we don't really need
that yeah anymore, for whateverreason yeah or you decide to
shuffle people around into adifferent structure within that
area of the business yep, orlike an amalgamation, if you see
(02:37):
oh look, actually thatdepartment and that department
could work better togetherexactly.
We only really need one managerover that, not two we're going
to get a different role?
Yeah, those sorts of things.
What about location?
If we were opening a new areaor relocating to a different
area?
And perhaps that might needreshuffling who works where and
with whom?
Speaker 2 (02:58):
Okay, so there's a lot of situations where it could
be an issue in your business,right?
Speaker 1 (03:03):
Yeah, the big question from a manager or
business owner might be am Iallowed to do this I think I've
had that said to us before, youknow and is it okay for me to
make that decision to justchange that person's job?
Well, yes, I feel like there'san asterisk to that.
Yes, yeah, that's right.
Speaker 2 (03:25):
See below.
So I guess the biggest concernabout restructuring is
redundancies, Right?
So that's where the risk is,the biggest risk for employers.
I suppose, although I thinkit's useful to look at
restructuring withoutredundancies first.
Speaker 1 (03:47):
Yeah, let's put that out of the way.
Speaker 2 (03:49):
Let's finish off on that first, and then we'll move
on to redundancies.
Speaker 1 (03:53):
Let's do that.
So when you're restructuringand not making people redundant,
that might look like changingsomeone's job description.
Let's say I have a new systemof technology of some kind or a
new piece of equipment that Inow need you to also do, and so
I'm going to be increasing thatand putting that into your job
(04:14):
description.
There you go, that's yours now.
Speaker 2 (04:19):
That sort of thing is not redundancy, that's just
changing things around aroundand now that you're saying that,
I'm thinking well, you couldreally.
You know, in some cases whereyou're changing the reporting
line, that could be arestructure without any sort of
redundancy as well yeah, we'veworked with some clients where a
restructure has meant for them.
Speaker 1 (04:38):
you know reporting lines are changing and so this
position no longer exists, butthis one does, or these two are
amalgamating, or we're nowcalling it something different
and like, if you think of anorganisational chart and you
might have a picture of that inyour head and if that's changing
, that might be a restructure interms of who's reporting to
(04:58):
whom.
Does payroll sit under HR ordoes it sit under finance that
age old problem, that sort ofthing, and you can probably in
some cases get away withoutredundancy, in that it just
might be changing who reports towho.
Speaker 2 (05:12):
Yeah, so that's a restructure.
Dear listener, I wish you couldhave seen Angela's hands, then
what she was saying would havemade a lot more sense.
Speaker 1 (05:25):
Arms going in every direction.
Speaker 2 (05:29):
Okay, let's get serious.
Let's get serious aboutredundancy, because it is a bit
of a scary topic.
Speaker 1 (05:36):
Yeah, yeah, it can be .
Ending anybody's employment canbe a tough one.
Speaker 2 (05:40):
Yeah, so they're under the sort of legal you know
what's right and what's wrongside of things.
The first thing you need todecide before you commence
redundancies is whether it'snecessary or not.
Maybe you could transfer thatstaff member to somewhere else
in the organisation where theycould be used, or you could
retrain them.
Speaker 1 (06:01):
Oh yeah.
Speaker 2 (06:02):
Or simply redeploy them.
So this is something that'sprobably worth discussing with
the people who are going to beaffected.
Speaker 1 (06:10):
Yeah.
Speaker 2 (06:11):
There are rules around consultation, and they
can be quite complex, yeah, sowe're not going to go into them
in detail here, but that's justone aspect of the consultation.
But then, before you even dothat, it's probably worth
considering whether this is agenuine redundancy.
So you, angela, and myselfprobably both experience a
(06:33):
situation where people don'twant to dismiss someone, so I
decide to make them redundant.
Speaker 1 (06:40):
Yeah, unfortunately, it can be something that people
might use to say, oh look, wedon't need you.
Sorry, it's not about you, it'sabout us.
And if it's not genuine.
Speaker 2 (06:50):
What you're getting at there is I'm really hiding
behind the word redundancy, butit's not really redundancy,
that's right, and if it's not agenuine redundancy, you can be
able to do an unfair dismissalclaim.
Yeah.
So what makes a redundancygenuine?
There's two parts.
One is the job doesn't need tobe done anymore, and the second
is that you follow consultationrequirements.
(07:12):
And if you've done both thosethings, or both those things
apply, then the people affectedcan't claim unfair dismissal.
Speaker 1 (07:20):
So the key part you said there was that the job, not
the person.
We don't like you.
You're not performing well,none of that.
You said the job doesn't needto be done Exactly.
So that is really important,because it's that we no longer
need that job in our team.
We no longer need those tasksto be done in that way.
So that is now being exitedfrom that all chart.
(07:42):
We no longer are going to haveanyone doing that work, and
that's actually quite a high barto meet.
Speaker 2 (07:48):
If you think about it , I'd agree.
So what the Fair WorkCommission would look at if
somebody claimed an unfairdismissal due to being made
redundant or the role being maderedundant is does that job
still need to be done?
And the obvious sign of thatwould be that you've given that
work, those tasks, to anotheremployee, or even employed
(08:11):
somebody else to do what thatperson was doing.
Speaker 1 (08:13):
I've got an unfortunate example of that
myself, where a person was maderedundant and told oh look, that
position doesn't exist anymore.
All the best to you.
And then four weeks latersomebody else started with the
word senior in front of theirname, and it was exactly the
same role.
It was just somebody else in it, and so that is definitely an
(08:37):
example of a non-genuineredundancy.
Speaker 2 (08:40):
Yeah, exactly, and I've seen the same thing, but in
reverse, so where a manager X YZ has been made redundant and
then the X Y Z team leader orwhatever has been hired, but
they're actually doing the samePD with a change of name.
So don't do that.
Speaker 1 (08:59):
No, you said consultation as well, susan.
So the rule of thumb there isinclude the employee in the
discussion and give them thereasons why that's happening and
be very clear about the reasons.
Speaker 2 (09:15):
There was one more aspect to judging whether the
redundancy was genuine or not.
Speaker 1 (09:20):
Yeah.
Speaker 2 (09:20):
And that is whether the person could have reasonably
be given another role in theorganisation.
Speaker 1 (09:27):
So that's about going okay.
Well, yes, the business isgoing in this direction, which
means the role's no longerneeded, but we've done what we
could to find where else youmight fit in the team and this
is what we've come up with.
Yep, now, sometimes that mightbe, we had no option.
It might be Other times itmight be.
Actually, if you're willing to,there's this position, if you'd
(09:48):
like to move into that one.
Speaker 2 (09:49):
And then that's back onto the employee and that does
not.
I feel the need to say this,although I wish I didn't.
That doesn't mean saying wedon't have your role anymore at
this pay rate, but we'reintroducing a new role, similar
to what I said with the managerand then team leader, you know.
(10:10):
But we are bringing in a morejunior role and you know you're
welcome to apply for that or wecan redeploy you into that role.
Speaker 1 (10:20):
What you're getting at there is you can't use that
idea of redundancy to disguisewhat you're really doing.
Speaker 2 (10:26):
Yeah, exactly.
Speaker 1 (10:29):
Another thing, Susan, is constructive dismissal.
Now that's a term that you andI are familiar with.
Our listeners might not be butbasically a constructive
dismissal is where the employeeis put in such a position that
they are almost forced to resignbecause the employer has made
(10:49):
the environment of the workplacereally hostile, and an example
might be making work conditionsunbearable, making it really
difficult for them to do theirjob, or giving them no other
option because the job'sshifting or changing or
something they can no longer door be qualified for or whatnot,
forcing them with no otheroption but to resign.
Speaker 2 (11:11):
Yeah.
So the example I gave earlierabout saying we're no longer
having your role, but they'reintroducing a lower level one
which may be reduced pay.
The employee can't afford toearn less.
That would be a constructivedismissal.
Speaker 1 (11:27):
I think yeah, bottom line.
What we're telling you is youneed to be aware of the reasons
that you can terminate someone'semployment and when you can't.
And you know there aredefinitely ways that you can
lawfully do that if you need to,if it's a valid business
decision.
Exactly so.
Another area that can be alittle nervy for business owners
is unfair dismissal andavoiding that action after
(11:48):
terminating someone's employment.
Look, that's another wholeother subject in itself, and
we'll do another episode abouthow to protect yourself from
unfair dismissal.
So look out for that.
Did you know that we have lotsof free resources available to
you on our website, things liketemplates that you could
(12:09):
download, or a checklist for aprocess, or even recordings of
our previous workshops?
If you're looking for help in aparticular area or just some
inspiration, check out theresources page on our website,
astrhrcomau.
And now it's back to theepisode.
Our website, asthrcomau.
And now it's back to theepisode.
Speaker 2 (12:30):
Now let's look at your obligations.
If you're actually going tomake people redundant, okay If
you have 15 or more employees.
Sorry if you're terminating 15or more employees you're legally
required to advise CentrelinkOkay, or Services Australia.
So just something to keep inmind.
(12:50):
Hopefully that's not the casefor most of our listeners, but
just in case, you do need toknow that the next thing you
really need to do is check therelevant awards or agreements,
whatever the industrialinstrument is that covers the
employment of your employees.
In terms of what thenotification is required and the
(13:11):
consultation expectations.
Speaker 1 (13:14):
Some of them can be specific, so that's a good point
, yep.
Speaker 2 (13:18):
It's also worth talking to unions if you have
unions involved in yourworkplace about the proposed
redundancies.
So this will mean that you'renotifying your employees and
also the unions.
Nobody likes a surprise.
Speaker 1 (13:34):
No.
Speaker 2 (13:35):
Especially not before Christmas.
Yeah, Please don't do it.
Speaker 1 (13:39):
Yeah absolutely Right before Christmas.
Speaker 2 (13:41):
Unfortunately that tends to happen a lot in
Australia I've noticed.
Yeah, you will need to contactan accountant because there's
going to be costs involved, yep,so that the accountant can help
you work out what they will behow you're going to pay it.
Speaker 1 (13:57):
There's a whole payout, isn't there?
Yes, you obviously pay thatnotice period that you're
talking about.
Depending on the size of yourbusiness, there might even be a
redundancy pay, so a bit ofextra pay.
There's other things like theymight have leave that need to be
paid out.
Speaker 2 (14:11):
Exactly, and things dependent on the employee's age
at the time of the redundancy,if they're over 45.
So there's a lot of things tobe considered and we can
certainly advise you on whatthose things are, but we'd say,
talk to your accountant aboutwhat it's going to cost you yeah
, because in some cases, ifyou're dealing with an employee
(14:31):
that's been there quite a while,it might be quite a bit oh yeah
.
Speaker 1 (14:35):
Or if you're making that bigger restructure, like
you said, where you're lettingmore than 15 people go, that
would be a big thing as well.
Speaker 2 (14:41):
Exactly.
Always have a look at the FairWork Ombudsman website.
There's lots of fact sheets andthings on there about
particularly about consultationand what needs to happen, what
the minimum requirements are.
We can link to the appropriatepages in the show notes and
we'll do that.
So, while there are theseobligations and the intolerance
(15:03):
that your employees have whenthey're made redundant, always
seek advice.
I'd say yeah, because yoursituation is going to be unique
and it's good to talk tosomebody first to work out the
pros and cons, the ins and outsof restructuring, and if you're
going to be doing it, it'susually a big enough project
that you're thinking about it inadvance.
(15:25):
Exactly.
It's usually a big enoughproject that you're thinking
about it in advance, exactly.
So, speaking of the employees,you want to make it as easy as
possible for them.
Presumably, the restructuringisn't caused by them, so it's
not a punishment for somethingthat they've done.
So you need to be very clearabout why you're doing it and
what your criteria are fordeciding who's leaving and who's
(15:49):
not.
Speaker 1 (15:50):
One of the things that we might help a client
through with Susan in terms ofkeeping employees informed is
again if you're planning thatsort of in advance and you've
got a bit of a piece of work tounderstand what it's going to
look like once you're done, youcould communicate with your
employees throughout thatprocess.
You may not tell themeverything that's okay, no of
course not, but you might youknow.
(16:11):
Let them know we're goingthrough this piece of work
because ABC is coming orsomething, something's lost or
different.
Exactly, let them know, hey,this is happening.
We want to keep you informed.
Do you have any questions, anyideas, any ideas?
And keep them informed throughthe process can be a really nice
way to approach it.
Yeah, what's your thoughts ondoing it in person rather than
(16:33):
over email or phone?
Speaker 2 (16:36):
Well, what do you think?
Of course you'd want to do itin person wouldn't you?
I mean you wouldn't want to.
Most of us wouldn't want to doit in person.
Speaker 1 (16:45):
But it's the right thing to do.
Yeah, I think employees wouldappreciate that.
Speaker 2 (16:49):
Yeah, and then, for your own guidance, be very clear
and consistent about what'sgoing to determine who is made
redundant.
So is it those jobs because wedon't need them anymore, or is
it people with thosequalifications because we don't
need them anymore, or is itpeople with those qualifications
because we don't need themanymore?
Or is it going to be based onlength of experience or whatever
(17:11):
you decide needs to be bothconsistent and fair.
Yeah, yeah that's true.
there are resources that areprovided online in terms of
going through a retrenchmentprocess and, as we discussed, we
can help you with that as well,but we'll be linking to
resources as well.
So we talked aboutcommunicating and communicating
(17:33):
well, but it needs to be enoughnotice given as well, so that
it's not a last-minute shock.
I think we mentioned thatearlier.
Speaker 1 (17:41):
Well, look, that can be it for employees, can't it?
It can be just the shock of itand going oh well, I need a job.
What?
Speaker 2 (17:46):
am I going?
Speaker 1 (17:47):
to do.
So yeah, if you're giving themthat notice, it gives them a
chance to decide what's rightfor them, whether they're happy
to see it out and follow you,depending what's going to happen
, or just wait and see, orwhether they're going to make
another decision to resign orthat sort of thing.
That's fair.
I think, some other nice thingsthat you could do.
You could actually, you know,offer people some additional
(18:10):
support, so by that I mean youmight offer them outplacement
services, which is helping themwith their resume Exactly
Interview skills.
Yeah, that sort of thing, Sortof understanding that, yeah,
look, we get it.
It's tough, you need to gosomewhere else and let's try and
help you.
Speaker 2 (18:26):
And understanding that, yeah, look, we get it.
It's tough, you need to gosomewhere else and let's try and
help you, and that might alsoinclude, you know, helping them
access health and wellbeingservices.
Speaker 1 (18:32):
And, as you said, centrelink as well, or services,
whatever they call themselves.
Now you've got to let them knowwhen you are letting go of more
than 15 people, but you canalso let the employee have a
form for Centrelink if they'rebeing made redundant, so they
can go ahead and do that withouttoo much trouble.
Speaker 2 (18:48):
Start going through that process.
Speaker 1 (18:50):
Yeah, so we hope that episode was helpful for you,
whether you're in a position ofchanges coming up for you in
your workplace or not, justwanting to know what your
obligations are.
We talked about whenrestructure can happen where
there's no redundancy and peoplearen't losing their job, that
(19:10):
things are changing, and thenalso going through the different
areas of when redundancyapplies and when it's genuine,
and how to handle thatappropriately.
I wonder what you got from that.
Please jump on LinkedIn and letus know today.
We always enjoy knowing what'sbeen valuable for you and, as we
said, we'll put all the linksto those relevant documents and
websites on the show notes.
(19:30):
Thanks for listening to theWork Wonders podcast brought to
you by Asta HR.
Hit the subscribe button now tonever miss an episode, and if
you'd like to continue theconversation with us, you can
find us over at astahrcomau.
(19:53):
See you in the next episode.
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