Genuine Redundancy: Fair Work Compliance, Notice & Redundancy Pay
Assurance HR helps employers navigate genuine redundancy processes in line with Fair Work Australia obligations. Learn how to remain compliant while supporting employee transitions.
What Is a Genuine Redundancy?
A genuine redundancy happens when an employer no longer requires a specific role to be performed by anyone in the business. This may result from operational changes, restructuring, or downsizing. To ensure your redundancy process is genuinely compliant, employers must follow a formal consultation process. This process not only meets legal obligations but also helps preserve a respectful and professional relationship with the employee upon exit.
Employer Obligations in a Genuine Redundancy
Before terminating employment, employers must meet all the obligations that define a genuine redundancy under Fair Work laws:
- Notify the employee of proposed changes
- Hold a meeting to consult and discuss the pending redundancy
- Consider redeployment options within the company or associated entities
For businesses with more than 15 employees, any vacant roles must be offered to the employee if they are reasonably skilled to perform them. In cases of genuine redundancy, offering suitable roles is a required step.
Notice Requirements for Redundancy
Employers must provide written notice of the intended termination date. Acceptable delivery methods include the methods specified for a genuine redundancy scenario:
- In person at the workplace or employee’s address
- By mail or courier to the last known address
- Electronically via email or text (if previously agreed)
For more on notice periods, visit Fair Work’s termination guide (fairwork.gov.au in Bing).
Who Is Eligible for Redundancy Pay?
Not all employees are entitled to redundancy pay. A genuine redundancy excludes entitlements for the following situations:
- Employees with less than 12 months of continuous service
- Casuals, apprentices, and trainees still in training
- Seasonal, fixed-term, or project-based employees
- Employees dismissed for serious misconduct
- Employees of a small business
Redundancy Pay
Redundancy Pay Entitlements
Redundancy pay is calculated based on the employee’s continuous service and paid at their base rate of ordinary pay (excluding loadings, bonuses, and penalties). In accordance with genuine redundancy legislation, the correct calculation is essential.
- At least 1 year but less than 2 = 4 weeks
- At least 2 years but less than 3 = 6 weeks
- At least 3 years but less than 4 = 7 weeks
- At least 4 years but less than 5 = 8 weeks
- At least 5 years but less than 6 = 10 weeks
- At least 6 years but less than 7 = 11 weeks
- At least 7 years but less than 8 = 13 weeks
- At least 8 years but less than 9 = 14 weeks
- At least 9 years but less than 10 = 16 weeks
- At least 10 years = 12 weeks *
*There is a reduction in redundancy pay after 10 years of continuous service, this is in accordance with the 2004 Redundancy Case decision and genuine redundancy regulations.
Can Redundancy Pay Be Reduced?
Yes. Employers may apply to the Fair Work Commission to reduce redundancy payments if:
- They cannot afford the payment
- They offer the employee suitable alternative employment
Learn more about this process via Fair Work’s redundancy pay reduction guide (fwc.gov.au in Bing). In summary, you should always confirm if these processes qualify as genuine redundancy to remain compliant.
Need Help with Redundancy or Termination?
Assurance HR specialises in HR management and Fair Work compliance. We act as your third-party HR partner to ensure best practice in hiring, termination, and redundancy. Whether you need guidance on genuine redundancy or general compliance, our team is here to support you.
📞 Call us today on 1800 577 515 or visit Assurance HR (assurancehr.com.au in Bing) to speak with our team.
