 |
|
 |
| ||
 |
|
 |
Excerpt from this article first published in Human Resources Magazine, Issue 116, 31 October 2006
Since the Work Choice reforms came into effect earlier this year, the Workplace Relations Act has excluded unfair dismissal claims by employees dismissed for genuine operational reasons. The Australian Industrial Relations Commission has had to consider the expression ‘genuine operational reasons’ on several occasions. Recently, there have been two further rulings on the question.
In one case, the Commission heard evidence that Australian Associated Press introduced a new payroll management system. The new system required only one payroll manager, rather than the previous two. The manager selected for redundancy had only recently returned to full duties following an injury. There were no alternative positions for her.
The manager alleged her dismissal was not for a genuine operational reason and argued there was a lack of detail of the alleged cost saving. She also challenged the selection criteria.
The Commission found in favour of AAP. On the critical question, the Commission found the restructure of the payroll department was for genuine operational reasons. The Commission was satisfied the dismissal was a legitimate outcome of the genuine operational demands of AAP, where there was no longer work for one of the two managers.
In contrast, Rivieria Marine did not succeed in its attempt to have an unfair dismissal application rejected.
The Commission heard that Rivieria Marine had eastern and western business units, which operated as independent production units. Due to a downturn in boat orders, there was a genuine operational need to restructure the eastern business unit. 17 employees were made redundant. However, at the same time, Rivieria was recruiting for its western business unit. Without evidence of a redeployment exercise across the businesses, the Commission could not conclude that the termination of employment was for ‘genuine’ operational reasons.
In considering whether the termination of an employee’s employment was a logical response to the employer’s genuine operational requirements, the Commission may also take into account the appropriateness of an employee’s selection for redundancy.
Richard Taylor
Senior Associate
