Employment Law - Redundancy and Pay Rate Queries

[JB6106]

Good morning,

We have an employee who has been with our company for nearly 12 years, as permanent part time. In April 2015, their hours were reduced from 50hrs per fortnight to 30hrs per fortnight due to their workload reducing as a result of streamlining their job processes & general economy conditions.

#1 - was it legal under employment law to reduce the employees hours verbally & immediately, without written notice?

#2 - if this employee were to be made redundant, would the calculations for the 12 weeks redundancy payment be on 30hrs per fortnight (the normal rate of pay for the employee currently)? They have told other members of staff that if they are going to be made redundant, they expect to be paid at their former hours of 50hrs per fortnight & have been informed by a 'legal source' that this is their entitlement.

#3 - will this be a redundancy if the employee is terminated due to inability to do the job required & someone else is employed in a new position that will also include the tasks of the former employee?

I look forward to your suggestions.

Thank you

 

[Sophea]

Hi there,

I'm not sure of the first two questions, but whether or not what you propose will be legally considered to be a genuine redundancy requires consideration of 3 things as discussed below. Simply the fact that someone else is performing the task that the redundant employee previously performed does not make the redundancy illegal.

1. Because of operational changes, do you no longer require any employee to perform the role ?

This might occur as a result of restructuring, and the redundant role may be given to another employee or split between multiple employees, where you downsize or where you reduce the number of employees due to financial reasons

2. Have you complied with the consultation obligations?

You must comply with the consultation provisions set out in applicable enterprise agreements or modern awards. This generally involves meeting with affected employees and providing information about the measures to be taken.

3. Is it unreasonable to redeploy the employee within the business?

If its reasonable you must offer a redundant employee continued employment in another position as an alternative to redundancy.

Whether this is reasonable will include consideration of whether there is a position available, whether employee has the requisite skills and competence to perform role with reasonable amount of retraining; and the employee will not earn less.