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Redundancy refers to when an employee has their employment terminated due to their employer believing their role is no longer required. Even when this redundancy is genuine, employees are still typically owed a range of redundancy entitlements to help ease the impact of this transition. If you have recently been made redundant, or believe you may become so in the future, it is important that you know exactly what you are owed by your employer.
If you require the services of a redundancy lawyer, submit an enquiry through our online form, or give us a call on 07 3726 5002 to discuss your situation and how we can assist you.
What is Redundancy?
If your employer has decided that your position is no longer required, or if you have completed all the tasks associated with your role, then you may be made redundant. This may also occur if the business is closing down or has gone bankrupt. It should not be linked to the employee’s performance, as redundancy means the role itself has been made redundant. If you have been made redundant, you are likely owed redundancy compensation.
Genuine reasons that an employee may be made redundant include:
- the company has entered insolvency or has ceased operations
- a major change in business conditions
- technological progress resulting in a machine or system replacing a role that was previously manual
- a downturn in business activity, leading to reduced workload
- duties needing to be reassigned to someone at a different level of seniority than the current person handling them
- relocation of the business to a new site
- a business merger or acquisition taking place
- transferring a function to an external provider
- an organisational restructure, such as changes to reporting relationships
If any of these reasons has caused you to be made redundant, it is important you reach out to a legal professional to learn more about your redundancy entitlements.
What Redundancy Compensation Am I Owed?
While your specific redundancy entitlements may vary based on your employer and the time you spent working there, most employees are entitled to financial compensation and a fair notice period under the Fair Work Act.
Notice Period
When you are being made redundant, you are entitled to a notice period to help you manage this transition. This notice period typically ranges from one week to four weeks and depends on the length of your employment. This prevents employers from terminating employees immediately due to redundancy, ensuring you receive adequate notice to begin planning the next stage of your professional journey.
Redundancy Pay
For many, the most important part of their redundancy compensation is the financial entitlements they will receive. This compensation is calculated based on the employee’s period of service, though it typically doesn’t include periods of casual employment.
As a general guide, redundancy payment amounts to:
- At least 1 year of employment but less than 2 years: 4 weeks’ pay
- 2–3 years: 6 weeks’ pay
- 3–4 years: 7 weeks’ pay
- 4–5 years: 8 weeks’ pay
- 5–6 years: 10 weeks’ pay
- 6–7 years: 11 weeks’ pay
- 7–8 years: 13 weeks’ pay
- 8–9 years: 14 weeks’ pay
- 9–10 years: 16 weeks’ pay
- 10+ years: 12 weeks’ pay (this decreases due to long service leave accruals applying instead)
These are the minimum amounts as set out by Australian law, and you may be entitled to more financial compensation based on the nature of your contract.
Are There Exceptions for Redundancy Pay?
Not all employees are entitled to redundancy pay, as there may be some exemptions based on the nature of their employment. These exceptions include:
- Employees of small businesses with less than 15 employees
- Casual employees
- Employees with less than 12 months of continuous service
- Apprentices or trainees whose employment ends at the conclusion of their training
- Fixed-term contract employees whose contract ends on its agreed date
What if I Disagree with My Redundancy Payment?
If you believe your redundancy entitlements are less than what you deserve, then it’s time to seek professional assistance. An employment lawyer will also assist you if you believe you haven’t received your full entitlement. They will review your claim and work with you to help secure a fair and just outcome.
You may have adequate grounds for a legal claim if:
- Your employer has hired someone else in the role they claimed was redundant
- You have not been paid the proper amount that aligns with your employment length
- You believe your redundancy was used as a cover for unfair dismissal
Build Your Case with an Employment Lawyer Today!
At Rubix Legal, we’re the workplace lawyers you can trust to help you secure fair and adequate compensation if you have been made redundant. We’ll work with you every step of the way to ensure you are always fully aware of your rights and what you are owed.
If you’re ready to arrange a consultation with our expert employment lawyers, call us on 07 3726 5002, make an enquiry through our online form.
