Redundancy

With staff cuts and abolition of library services still major features of the labour market, redundancy continues to affect ALIA members. In confronting it, employees need to know what rights they have and what obligations lie with their employers.

There are two sources of law governing these matters: firstly, clauses in industrial awards or agreements and, secondly, statutory provisions which specify standards and protect workers whose employment is terminated for technological, structural or economic reasons. The three main aspects to consider are:

1. Is the termination of employment a genuine redundancy?
2. If so, what consultation and notice should be provided? and
3. What severance pay, if any, is payable?

Basis for termination
No explicit definition of redundancy covers all situations. But a number of important legal judgements have described it as termination of employment which is not a result of any personal act or fault of individual employees nor of any characteristic peculiar to them. Their employment is terminated because the employer no longer requires their jobs to be filled by anyone.

If an employee is dismissed and a replacement is subsequently engaged to do the same work this cannot be construed as a true redundancy. But abolition of a job and allocation of its duties to the rest of the staff may constitute redundancy.

Consultation and notice
The Termination, Change and Redundancy case of 1984 introduced standards into most industrial awards and agreements. These require employers to consult and hold discussions with relevant trade unions about likely redundancies, including consideration of steps to avoid them.

Proper notice periods must be given when redundancies are necessary. These must at least meet the standard specified in the Workplace Relations Act 1996 [see table alongside].

Employees who are over 45 years old must receive an additional week's notice.

Compensation
Many awards and agreements have firm severance pay entitlements. The most common minimum standard is two weeks pay for every year of service. Some organisations have more generous standards. Others are not strictly bound by any standard, but in these cases most adopt the two-week per year standard on a voluntary basis as part of personnel policy. Redundancy payments of this kind receive preferential tax treatment.

Members who find themselves facing redundancy should contact ALIA's industrial service or their trade union for guidance on entitlements.

This advice provides only a general outline of legal rights and obligations. Members needing more thorough information or advice should contact ALIA's National Office industrial service.