I recently had a client reach out to me about a proposed redundancy. They’re the sole HR resource for a medium-sized retail business and mentioned that some HR colleagues told them they “don’t bother with consultation” when making a role redundant.
This really got me thinking.
While skipping consultation might seem common in some circles, my advice was clear and firm: consultation is not optional if the employee is covered by a modern award or enterprise agreement (EBA).
When Is Consultation Legally Required in a Redundancy?
Under the Fair Work Act 2009 (section 389 to be exact), employers must consult with employees about redundancy if they are covered by a modern award or enterprise agreement. This includes:
- Notifying the employee of the proposed changes,
- Providing relevant information about the redundancy,
- Genuinely considering alternatives and feedback from the employee.
Many employers assume that high-paying, white-collar roles are award-free. But this is often incorrect. Roles such as administration managers, analysts, and professional employees may still fall under the Clerks – Private Sector Award 2020 or the Professional Employees Award 2020.
What Happens If You Don’t Consult? Jurisdictional Risks
Failing to consult can land you in a jurisdictional dispute before the Fair Work Commission (FWC).
These disputes typically centre around two legal questions:
- Is the employee covered by a modern award or enterprise agreement?
- Was the redundancy genuine under the Fair Work Act?
These are not minor issues. They often determine whether the FWC can hear an unfair dismissal claim, and they significantly influence the outcome. If a Commission Member finds that the employee should have been consulted, the dismissal may be ruled unfair—even if the role was genuinely redundant.
I’ve helped clients navigate these disputes. In one case, the assumption that an employee was award-free turned out to be incorrect, and the consultation process hadn’t been followed. While we managed to resolve the matter, the stress, time, and legal risk could have been avoided with a simple consultation process.
How to Check If an Employee is Award-Covered
Don’t guess. Use these resources:
- Fair Work Ombudsman’s Award Finder Tool: https://www.fairwork.gov.au/awards-and-agreements/awards/find-my-award
- Fair Work Commission Award List: https://www.fwc.gov.au/awards-and-agreements/awards
If you’re still unsure, get advice from a workplace relations consultant or lawyer.
What Makes a Redundancy ‘Genuine’ Under the Fair Work Act?
A genuine redundancy under the Fair Work Act requires that:
- The employer no longer requires the person’s job to be performed by anyone,
- The employer complied with any consultation obligations, and
- The employee could not have been reasonably redeployed elsewhere in the business or its associated entities.
Miss any of these, and you risk an unfair dismissal claim.
FAQ – Redundancy and Consultation in Australia
Q: What if the employee is highly paid or a professional?
A: High pay doesn’t automatically make someone award-free. Many professional and administrative roles remain award-covered.
Q: What if there’s no modern award or EBA?
A: If the employee is truly award-free and not covered by an EBA, consultation may not be legally required—but it’s still recommended to manage risk.
Q: What’s involved in a compliant consultation?
A: Written notice, a genuine meeting to explore options, and meaningful consideration of the employee’s input.
Need Help Navigating a Redundancy?
If you’re unsure whether a role is award-covered, or want to ensure your redundancy process meets the requirements of the Fair Work Act, get in touch today. We provide practical, expert support to help you reduce risk, stay compliant, and handle difficult conversations professionally.
Disclaimer:
This post is for general informational purposes only and does not constitute legal advice. Always consult a qualified employment relations (ER) specialist or employment lawyer before taking action on a redundancy or termination.