There has been a recent surge in Aussie businesses closing their doors or selling their businesses. 60% of HR professionals in the public sector are anticipating job cuts this quarter. The increase in redundancies is more likely to be from restructuring instead of job cuts. This means that you will have to find alternative employment for your employees.
When dealing with redundancies, there are several ways to tackle the fallout and consequences. In this guide for employers, we outline what is alternative employment, when employers need to find it, key factors to remember, and ways Peninsula can help you.
Alternative employment
When being made redundant, the employer must make a reasonable effort to find a suitable alternative role. One of the requirements is to explore all suitable alternatives to making someone redundant. Suitable alternative employment is considering whether any of the redundant employees can be employed elsewhere in the organisation. It is also known as ‘reasonable redeployment.’
If the employer:
- Offers ‘suitable alternative employment’ or ‘reasonable redeployment’ and this is accepted by an employee facing redundancy, that employee is never made redundant and moves into the new role.
- Offers ‘suitable alternative employment’ or ‘reasonable redeployment’, which is reasonably refused by an employee facing redundancy, that employee will be made redundant and entitled to statutory, and possibly enhanced, redundancy pay, depending on the organisation’s policy.
- Does not offer ‘suitable alternative employment’ or ‘reasonable redeployment’, the employee facing redundancy could claim unfair dismissal.
- Offers ‘suitable alternative employment’ or ‘reasonable redeployment’ which is unreasonably refused by an employee facing redundancy, that employee will lose their redundancy rights.
Reasonable redeployment
During the redundancy, you need to consider whether there is reasonable redeployment available for your employee. Whether the alternative employment is ‘suitable’ will depend on multiple factors, such as similarity of the new role to the employee’s current job, terms of employment including pay, location, benefits, seniority, and the employee’s qualifications.
Just considering if there is any ‘reasonable redeployment’ will not be sufficient. You must consider this through the process and if a ‘suitable alternative’ role arises at any time during the process, it should be offered to the employees facing redundancy.
You can also offer the employee their original job as a ‘suitable alternative.’ This may be possible if, for example, the redundancy arose after a marked decrease in work but there is an upturn in work before the employee actually becomes redundant. If no ‘suitable alternative’ is available, then you can continue the redundancy process, paying the affected employee statutory redundancy pay.
You must also give the employee enough time to consider the suitable alternative employment and make an informed decision.
Process of offering suitable alternative employment
The process of offering suitable alternative employment differs based on the organisation and their redundancy. If suitable alternative employment is available, the process of offering it to the affected employees will depend on the size of the organisation and the number of employees facing redundancy. Usually, you can speak to your employees about available options and give them the offer of suitable alternative employment in writing. If your organisation is fairly big and sizable and a large number of employees are facing redundancy, you can provide them with a list with available options.
There is no legal requirement to put the alternative employment offer in writing, but it is good practice to do so and having it written will ensure there is a record.