AREEA principal employee relations consultant Bill FitzGerald examines a controversial ruling from the Fair Work Commission in which a redundancy resulting from the creation of a higher-level administrative role was found to be genuine, despite the new position picking up 70% of the duties from the previous one.

DECIDED on appeal in recent weeks, a bookkeeper for a north Queensland taxi company was found to have been genuinely dismissed after the company created a new administrative role comprising 70% of the previous duties, but additionally requiring a Certificate IV qualification, making the previous role redundant.

The significant point at issue is whether a new job requirement, albeit a small part of the overall job, means that the existing position is redundant while effectively a new position is created by imposing additional job requirements.

A Full Bench overturned the Commissioner’s initial decision at first instance, ruling that the changes were to “an existing and continuing role”, and could not therefore satisfy the genuine redundancy definition. The full bench instead said the new role was not the same as the old one.

“The requirement for a formal qualification was not added to a job as if a mere administrative initiative. The qualifications required were reflective of new and higher level duties which were to be carried out by an appropriately qualified bookkeeper,” it said.

The bench said the position was therefore a new job, despite the fact that it incorporated many of the bookkeeper’s former tasks.

It said the modifications to the position amounted to operational changes.

“That is, they are changes that give effect to a change in the operational focus of a position to the benefit or advantage of the employer (be it to meet governance requirements or to improve efficiency),” it said.

“Whether the original duties or tasks continue to be required to be performed is not necessarily relevant: it is the operationally-driven changes to the position that need to be made out.”

“The operational objective on the part of the employer to rely on the qualified services of a bookkeeper to improve the ‘capacity of the administration to function at a higher level’ brought about a real and genuine change to the position as it had been performed by the bookkeeper. This is the kind of change that ordinarily would give rise to a redundancy (where the incumbent does not possess the qualifications to give effect to the operational objective).”

The bench said the genuineness of the rationale for the new qualifications had not been challenged.

“It is reasonable in such circumstances that an employer, as the bearer of risks, might re-organise the manner in which work is conducted and with what degree of specialism. If this were not the case, significant rigidities would be introduced into business improvement systems.”

The bench referred the bookkeeper’s unfair dismissal application to Commissioner Simpson to determine whether she could have been reasonably redeployed under s389 (2). Commissioner Booth had not been required to decide that issue.

The issue of reasonable alternative employment which is a prerequisite to demonstrating a genuine redundancy was not determined by the Commissioner at first instance given that the focus of the decision was whether a redundancy did in fact occur which was clarified by the Full Bench.

This is an important decision and clarifies that AREEA members have the managerial prerogative to restructure jobs which may in turn result in genuine redundancies. Each case should be assessed on the individual merits but where the new requirement is needed immediately it is open for AREEA members to deem the original position to be redundant because of that and it is not reasonable for an extension of time to enable the incumbent to gain the new qualification.

AREEA’s employee relations consultants are experts in this often complex area and are able to provide advice, template letters and information covering redundancy to help protect your organisation from potential issues in workforce changes. Contact your local AREEA office here to talk to a consultant.