As part of any redundancy process requiring a selection of employees, it is critical that employers consider only matters that are objectively related to an employee in their role and not any of the prohibited reasons under the FairWork Act 2009 (Cth).
If an employee is selected for redundancy due to a prohibited reason, the employee may be entitled to bring a claim in relation to their dismissal, as was the case in the recent decision of Jeater v Mondiale VGL Pty Ltd [2022] FedCFamC2G 758.
In this matter, the Federal Circuit and Family Court of Australia (the Court) heard that the employee, who was a truck driver for Mondiale VGL Pty Ltd (the Employer), was made redundant as a result of a national restructure prompted by the negative financial impacts of the COVID-19 pandemic.
The employee claimed that the Employer had terminated his employment because he had exercised his workplace right to make a complaint or inquiry, including by:
The Employer submitted that this could not be the case because it was only the employee’s direct managers who were aware of his exercise of workplace rights and those managers did not make the decision to select him for redundancy.
The Employer submitted the decision was made by the National Transport Manager who, due to the ongoing downturn in business resulting from the pandemic, selected 22 employees for redundancy including the employee. It was submitted that the employee was selected for redundancy due to his documented poor disciplinary history, performance, and attitude.
However, the Court found that the Employer provided little evidence in support of this conclusion and in doing so, failed to discharge the reverse onus in disproving that the employee had been terminated due to his exercise of workplace rights.
The Court placed considerable weight on the oral testimony of the National Transport Manager who conceded that the decision to make the employee redundant was in fact heavily influenced by the employee’s direct managers.
Accordingly, the Court held that the National Transport Manager was not the only decision-maker in selecting the employee for redundancy and instead, he was one of three decision-makers including the two managers who were aware of the employee’s exercise of workplace rights.
Turning then to the selection process, the Court considered the only document submitted by the Employer which purportedly demonstrated its efforts to measure the employee’s performance as part of the redundancy selection process. The document compared the “container movement rates” of the employee against the other driver at the Perth depot at which he was located.
The Court found this document to be insufficient in measuring the employee’s performance given that the Employer could not identify who produced the document or verify its accuracy. Further, the Court found the oral testimony of the National Transport Manager did not provide any certainty as to the reasons for selecting the employee for redundancy or when the final decision was made.
Without any evidence from the other two decision-makers, the Court inferred it was likely that they were not impartial and may have raised the employee’s exercise of workplace rights in discussions with the National Transport Manager.
Accordingly, the Court held that in the absence of evidence by the Employer disproving the employee’s allegations, it followed that the Employer had taken adverse action against the employee by terminating his employment because of his exercise of workplace rights.
A redundancy selection process should always be objective, non-discriminatory and measurable so as to minimise any claims that the reason for an employee’s selection for redundancy was not genuine.
As seen in this decision, the courts will assess the evidence of each decision-maker in light of the objectively known facts to determine the true and comprehensive reason as to why the employee was selected for redundancy. Therefore, employers should ensure that the reasons for selecting an employee for redundancy are well documented.
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