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Redundancy and the Effect of a Failure to Redeploy

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The Full Bench of Fair Work Australia has found that the redundancy of a regional manager, at Jenny Craig, was not genuine as the company could have redeployed her.

The Full Bench, in Jenny Craig Weight Loss Centres Pty Ltd v I Magnolia, found that it was clear that a lower level position was available to which the regional manager could have been redeployed. The Full Bench went on to state, “that it would have been reasonable in the circumstances for [the manager] to be redeployed”, and that as a result, the employee’s redundancy was not genuine.

According to evidence submitted to Fair Work Australia, the former employee asked several times if there were any other potential positions and Jenny Craig failed to offer the lower level position that was available. The former employee submitted to Fair Work Australia that she would indeed have taken on a lower position to better meet her family commitments. Instead, Jenny Craig contended that there were no senior leadership roles available which were commensurate with the expertise and leadership qualities of the former employee.

As a consequence, the Full Bench made the decision that the situation of the respondent made redeployment ‘reasonable’ under the circumstances.

Employers, prior to making an employee’s position redundant should consider:

  • any lower level positions that the employee has the necessary skills, qualifications and experience to perform;
  • asking the employee whether they would be willing to perform any of the lower level positions identified; and
  • offering such positions to the employee concerned as an alternative to making that employee’s position redundant.

For further information in relation to redundancy procedures and entitlements contact the MST Workplace Relations Team.

Author: Chad Issa

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