The High Court’s August 2025 decision in Helensburgh Coal Pty Ltd v Bartley & Ors provides important guidance on the meaning of genuine redundancy under the Fair Work Act 2009 (Cth) (FW Act). It confirms that, when determining whether a dismissal was a genuine redundancy under the FW Act, the Fair Work Commission may consider whether an employer could reasonably have restructured its workforce or labour arrangements to facilitate redeployment. The decision reinforces the Fair Work Commission’s (Commission) broad scope of the redeployment inquiry, including scrutiny of work performed through labour hire and outsourcing arrangements.
Facts & Case History
In June 2020, Helensburgh Coal Pty Ltd made 47 employees redundant due to the impact of COVID-19 on demand for coking coal in domestic and international markets. In spite of the redundancies, Helensburgh continued to engage workers from contracting firm Nexus Mining and Mentser Pty Ltd to perform ‘ongoing and sustaining’ work at the mine. These tasks fell within the skills and competencies of the redundant employees. Upon finding out about this contracting arrangement, 22 former employees of Helensburgh lodged unfair dismissal claims, contending that their terminations were not cases of genuine redundancy.
The Commission found that the dismissals were not cases of genuine redundancy within the meaning of the FW Act. Section 389(2) of the FW Act provides that a dismissal is not a genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed in the employer’s enterprise or an associated entity.
Helensburgh appealed the decisions to the Full Bench, the Federal Court and the Full Federal Court and each appeal was unsuccessful. Helensburgh then appealed to the High Court.
Issue
The primary issue raised by Helensburgh related to the scope of inquiry mandated by section 389(2) of the FW Act, which provides that a dismissal is not a case of genuine redundancy if it would have been reasonable in all the circumstances to redeploy the employee within the employer’s enterprise or the enterprise of an associated entity.
The question was whether the Commission could consider operational changes that the employer could reasonably have made when determining whether it would have been reasonable in all the circumstances to redeploy an employee within the employer’s enterprise.
Decisions & Reasons
The High Court unanimously dismissed Helensburgh’s appeal, finding that the Commission is entitled to consider potential changes an employer could reasonably make to its workforce structure and composition to accommodate redeployment when assessing whether redeployment would have been reasonable under s 389(2).
The Court held that while the “employer’s enterprise” referred to in s 389(2) is fixed at the date of dismissal and the Commission cannot disregard the nature of the enterprise, this does not prevent the Commission from examining the employer’s workforce structure, labour utilisation practices, and other operational characteristics of the enterprise. While an employer has the right to make redundancies based on its operational requirements, this does not prevent an examination of whether the employer could reasonably have redeployed the employees by utilising its existing workforce differently within the enterprise.
The Court confirmed redeployment does not require a vacant position to already exist and s 389(2) directs a hypothetical analysis of what could reasonably have been done to redeploy the employee at the time of dismissal. There are no prescriptive rules limiting this assessment. While employers’ operational and resourcing decisions must be respected, all the circumstances can be examined to determine if redeployment of employees through changes made to workforce composition would have been reasonable. However, the Court cautioned this will likely only arise in rare cases.
What Employers Need to Know
The High Court’s decision affirms that determining whether redeployment is reasonable requires a careful examination of the circumstances of the employer’s enterprise and workforce at the time of the redundancy. Employers must carefully consider and document all reasonable redeployment options to minimise the risk of unfair dismissal claims, including potential changes to their workforce structure and composition. This may involve:
- assessing the feasibility and impact of measures like insourcing roles currently filled by contractors;
- adjusting the mix of permanent and casual employees;
- retraining employees; or
- reshaping positions.
Now more than ever, it is essential for employers to clearly document and formalise their consultation process, workplace planning, redeployment considerations and ultimately the redundancy process. Maintaining clear records of these processes may provide important evidence that appropriate consideration was given to consultation, redeployment and redundancy obligations before any redundancies were implemented.
If your organisation is planning a restructure or redundancy program, Coleman Greig’s Employment Law team can assist in assessing redeployment obligations, managing consultation requirements and reducing the risk of unfair dismissal claims.
