WEEKLY INSIGHT

Keep an eye out—2025 might see a shift in redeployment obligations

The Helensburgh Coal Case has had significant implications for employment practices and redundancy procedures. Below, we summarise the key points from this important legal challenge:

Redundancy Challenge  

During COVID-19, employees from Helensburgh Coal raised challenges against the validity of their redundancies, prompting a closer examination of the circumstances surrounding these decisions.

Disproportionate Impact on Direct Employees  

The restructuring significantly reduced the number of direct employees, while external contractors saw only a minor decrease. This disparity has raised concerns about fair treatment during the downsizing process.

Legal Proceedings  

The situation escalated through a series of legal proceedings, including rulings from the FWC & a decisive Federal Court judgment.

Federal Court Ruling  

Employers may need to redeploy affected employees into roles once filled by external contractors, impacting redundancy management significantly. Employers may be required to redeploy affected employees into roles that were previously filled by external contractors. This finding has important repercussions for how redundancies are managed.

High Court Appeal  

In response, Helensburgh Coal has decided to appeal the Federal Court’s decision to the High Court, which could further influence the legal landscape surrounding employment practices.

Implications for Employers  

Source – HR Daily (2024)

As we reflect on this case, several key implications emerge:

1. Stricter Redundancy Requirements: This case may set a precedent for stricter redundancy laws, particularly regarding an employer’s obligation to redeploy employees.

2. Increased Scrutiny of Restructuring Decisions: Employers are likely to face heightened scrutiny of their restructuring efforts, especially when they involve significant cuts to direct staffing.