Redundancy Just Got More Complicated: Why Business Owners Need To Seek Advice

If you’ve ever had to make a role redundant, you’ll know it’s one of the hardest parts of running a business.

It’s not just emotionally difficult, it’s also legally complex.

And thanks to a recent High Court decision (Helensburgh Coal v Bartley), those difficulties may have gotten worse.

Now, before you can call a redundancy ‘genuine’ under the Fair Work Act, you will have to consider redeployment of the employee. It’s no longer enough to show that the role isn’t needed and that no similar internal roles are available.

You will need to assess whether it would be reasonable to:

• Redeploy the person into a role currently done by a contractor or labour hire worker.
• Restructure your workforce to create a suitable role.
• Insource work that’s currently outsourced.

Why does this matter for business owners?

If an employee is eligible to make an unfair dismissal claim, failing to follow these obligations could mean:

• The redundancy is deemed not ‘genuine’.
• You face reinstatement orders, compensation payouts, and significant legal costs.
• Your business reputation and workplace culture take a hit.

Even well-meaning business owners can stumble here. It’s important to remember that HR isn’t just a checklist. It’s about understanding obligations that aren’t always clear-cut and making sure they work for your own circumstances.

Common mistakes

Some common pitfalls include:

• Not documenting your consideration of redeployment options
• Overlooking contractor or labour hire roles as potential redeployment opportunities
• Failing to consult employees properly
• Assuming that ‘no exact match’ means ‘no redeployment possible’

Redundancy is one of the riskiest areas of employment law for employers. The legal, financial, and reputational stakes are high, and the rules constantly shift with court decisions like this one.

Before you make any redundancy decision, please get advice from an experienced HR or employment law adviser. They can:

• Help you map out and document redeployment considerations.
• Ensure consultation obligations are met.
• Minimise legal and reputational risk.
• Give you confidence that you’ve done the right thing, both legally and ethically.

When it comes to HR, you should always invest time and seek proper advice to protect your business.

This is general advice only and has not been prepared with your situation and needs in mind. For individual and personalised advice, we highly recommend that you seek out proper professional advice from your business adviser.