By Nicole Brideson, Paralegal
The High Court’s recent decision in Helensburgh Coal Pty Ltd v Bartley [2025] HCA 29 (Helensburgh Case) clarified the scope for which the Fair Work Commission can make enquiries regarding the changes a business is undergoing to justify a genuine redundancy.
What is a genuine redundancy?
In simply terms, a genuine redundancy means that:
- the employee’s job no longer needs to be done by anyone;
- the employer has met all consultation obligations as applicable under the relevant award or enterprise agreement; and
- Employers have considered whether there are any reasonable redeployment opportunities available in the employer’s enterprise, and it is crucial that an employer can show they have explored all avenues of redeployment before making a final decision on redundancy.
But does this consideration have to extend to roles undertaken by contractors? This question was considered by the High Court in the Helensburgh Case.
Do redeployment considerations extend to roles undertaken by contractors?
Background facts
In 2020, during the Covid-19 pandemic, Helensburgh Coal Pty Ltd (Helensburgh) decided to reduce their production of coal in Illawarra, New South Wales, as demand for the extracted coal was significantly decreasing. Due to this reduction, 90 employees were dismissed and made redundant, with 47 of those employees being subject to forced redundancy. Helensburgh’s contractor workforce was also decreased by 40%, with the remaining contractors engaged to undertake continuing as-needed work.
22 of the employees whose roles were made redundant, alleged they were unfairly dismissed arguing that the Employer could have reasonably redeployed the employees into the roles undertaken by Helensburgh’s contractors.
The key issue? Could the employees be redeployed?
The FWC made an order for Ms Callow’s reinstatement and for continuity of service.
The outcome is a timely reminder that the primary remedy for unfair dismissal is reinstatement rather than compensation.
What did the High Court say?
The High Court dismissed the appeal, finding that the Commission had a broad scope to conduct inquiries into whether a redundancy was genuine or not.
The Court held that:
- Redeployment considerations do not only cover positions which are vacant within the enterprise but further extends to whether the employer’s workforce or operations could be reasonably rearranged or reorganised to facilitate redeployment.
- The Commission may consider if the employer could reasonably have been expected to “free-up work for its employees by reducing its reliance upon external providers”, such as insourcing work from existing contractors.
- The Commission’s enquiry is a holistic one, they are not considering “reasonableness” only from the perspective of the employer or employee, but rather from what would have been reasonable within the context of the time the dismissal was made and the nature of the enterprise the employer operates.
- The phrase “all the circumstances” is inherently broad, therefore the Commission’s inquiry may look at attributes within an employer’s enterprise – such as their policies, procedures, practices, appetite for risk, practical concerns, and much more – when deciding the reasonableness of redeployment. In essence, the essential and important facets of the employer’s enterprise must be considered.
What did the High Court say about considering contractor roles?
Do redeployment considerations extend to roles undertaken by contractors? The short answer is… yes!
The High Court found that there was no policy in place that stated the jobs the contractors were engaged to undertake, could not be completed by an employee and there was also no legal obligation upon Helensburgh to re-engage contractors.
Key Takeaway for Employers
The High Court’s decision:
- reinforces the Commission’s approach to considering reasonableness is a holistic one, considering the context of the dismissal at the time it was made, and the nature of the employer’s business or enterprise; and
- emphasises the importance of considering all redeployment possibilities, including contractor roles before making employees redundant.
How can Grazia Legal Help?
At Grazia Legal we can:
- Provide restructuring and redundancy advice.
- Guide you through the redundancy consultation process.
Please call Grazia Legal or visit our website to submit an enquiry.
Disclaimer: The information in this article is of a general nature. It does not constitute formal legal advice, and should not be relied on as such. Please contact Grazia Legal for tailored legal advice.
