High Court raises the bar for ‘genuine redundancies’

Commentary by Marie Khoury

The High Court recently delivered its much-anticipated decision in Helensburgh Coal Pty Ltd v Bartley & Ors [2025] HCA 29, unanimously dismissing the employer’s appeal and confirming a broad interpretation of employers’ redeployment obligations under section 389(2) of the Fair Work Act 2009 (Cth) (“FW Act”).

Background

The first of 22 respondents worked at a mine operated by the appellant (“Helensburgh Coal”).

In 2020, due to economic downturn during COVID-19, Helensburgh Coal restructured its operations at the mine (thereby requiring fewer workers) and consequently dismissed 22 of its employees. At the same time, Helensburgh continued to deploy around 60% of its contractors to perform work at the mine.

The Employees applied to the Fair Work Commission ("the FWC") for remedies for unfair dismissal. Helensburgh objected to the applications on the basis that the terminations were cases of "genuine redundancy" under s 389 of the Fair Work Act 2009 (Cth). Through a series of four decisions, the FWC ultimately held that the terminations were not cases of "genuine redundancy" because, applying s 389(2), the affected employees could have reasonably been redeployed to perform work still being carried out by the remaining contractors.

Helensburgh applied to the Full Federal Court for judicial review of the FWC decisions. The Full Federal Court dismissed the application.

Decision of the High Court 

The High Court held that the FWC could inquire into whether it would have been reasonable in all the circumstances for the Employees to be redeployed in Helensburgh's enterprise to perform work that was being performed by the contractors. On the correct construction of s 389(2), it found the FWC was permitted to inquire into whether an employer could have made changes to how it uses its workforce to operate its enterprise so as to create or make available a position for an employee who would otherwise have been redundant.

Remedies for the affected workers are now set to be determined by the Fair Work Commission.

This decision has significant implications for employers navigating restructures and redundancies, particularly where contractors are performing work that could be undertaken by employees.

Employers undergoing a restructure or redundancy process should carefully consider the following:

• whether employees could be redeployed into roles currently performed by contractors, especially where the work is not highly specialised and could be performed with minimal retraining; and

• whether employees could, in the near future, be redeployed into roles that could become available through operational changes, contract expirations, or retirements.

Read the full judgment here: https://lnkd.in/g9mZJVMK