As employment lawyers we are often asked about redundancy. Many employers mistakenly assume that redundancy only relates to redundancy pay and look at section 119 of the Fair Work Act for the amount to be paid.
This is a costly mistake! The following are just some of the things that must be addressed before termination for redundancy.
- Most Awards require a consultation process before the notice of termination is given. Failure to comply with those Award obligations means that the termination will be an unfair dismissal!
- Some Awards provide for redundancy pay to be calculated on a formula different from that under section 119. If so, the employer may have breached the Award and the employee, a union or the Fair Work Ombudsman could issue proceedings against the employer to recover any underpayment with penalties and interest.
- Redundancy is a very specific type of termination. Calling a termination a redundancy when it is not may breach tax laws and the ATO may investigate.
If in doubt, give us a call on (03) 5722 4681.
MORGAN COUZENS LEGAL