In the case of Broadlex Services Pty Ltd v United Workers’ Union [2020] FCA 867, the Federal Court of Australia held that an employee who was required to transfer from full time to part time employment was entitled to redundancy pay, on the basis that the employer no longer required the full-time job to be performed by anyone.
The employee worked for Broadlex Services, a cleaning company that provides services to a number of clients, including the Australian Taxation Office (ATO). As part of a tender process with the ATO, Broadlex was required to reduce its workforce and change the employment status of some of its staff from full-time to part-time. The employee in question was one of those affected by this change. The employer informed the employee that their work hours would be reduced from 38 hours to 20 hours a week, and the employee’s salary would be reduced by approximately 40%.
Proceedings were brought against the employer, by the United Workers’ Union seeking redundancy pay.
The Court at first instance awarded the employee with redundancy pay, as the employer no longer required the full-time job to be performed by anyone. The employer appealed the decision, on the basis that the employee would only be entitled to redundancy pay if the employment relationship ended. On appeal, the Federal Court of Australia dismissed the appeal on the basis that there was wrongful dismissal constituted by the employer’s repudiation, and therefore the full-time contract of employment had been terminated.
The Federal Court of Australia was satisfied that as the reason for termination was that the employer no longer required the full-time job to be performed by anyone, that the employee was entitled to redundancy pay.
This case highlights the importance of understanding an employee’s entitlements under the Fair Work Act 2009 (Cth), particularly when it comes to issues such as redundancy pay and changes in employment status.
