Warning to employers – Avoiding redundancy pay

A Warning to employers seeking to avoid redundancy pay

Better HR – Protecting Employers

A recent Fair Work Australia (FWA) case provides a warning to employers seeking to avoid redundancy pay by securing “acceptable alternative employment” for the employee.

HiClass Composites made an employee redundant but offered to move him into a role paying nearly $10 less per hour than what he was previously earning, which he rejected.

Employers need to be mindful that a court or tribunal is more likely to find a role to be an acceptable alternative role if the new role is commensurate or higher in salary (or at the very least, not significantly lower), is a role that utilises the skills of the employee and if the role was created or obtained by the business itself (as opposed to an external company).

To read the full case and decision as seen on the FWA website click here


This article is intended to provide commentary and general information. It should not be relied upon as legal advice. Formal legal advice may be necessary in particular transactions or on matters of interest arising from this article. Better HR Pty Ltd (https://betterhr.com.au/) is not responsible for the results of any actions taken on the basis of information in this article, nor for any error or omission in this article.

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