The Fair Work Commission (FWC) has recently provided some useful guidance on when it will not be “reasonable in all the circumstances” to redeploy a worker from a redundant position to another available position within the organisation for the purposes of the “genuine redundancy” exclusion from unfair dismissal claims.
It has also demonstrated for the first time that it is prepared to order applicants to provide security to satisfy potential cost orders in appropriate cases.
First instance decision
In Velasquez v Cabrini Health Ltd  FWC 5965, a Grade 3 social worker claimed his dismissal was not a genuine redundancy because his employer did not redeploy him into another available Grade 1 position for which he was clearly qualified.
The employer refused to redeploy the social worker because:
Prior cases have typically relied on the following confined principles in assessing whether redeployment was reasonable in all the circumstances:
In finding there was a genuine redundancy, Deputy President Gostencnik accepted that “fit” was also a relevant consideration and that employers could take into account “ the likely impact of redeploying a person into a job, position or other work on the cohesiveness of a work group and its efficiency and productivity because of the relationship that the person has, or has had, with prospective co-workers or supervisors
” in determining whether redeployment was reasonable in all the circumstances.
In this case, the Deputy President placed significant weight on “the serious level of distrust and lack of respect the [social worker] apparently had for [the manager]”. It was not a mere personality clash as the social worker had tried to characterise it.
The social worker appealed Deputy President Gostencnik’s decision and the employer sought to have the social worker pay security to satisfy a potential costs order against him in Velasquez v Cabrini Health Ltd  FWCFB 888. In granting the first order for security for costs that the Fair Work Commission has ever made, the Full Bench effectively endorsed the first instance decision when it found that:
The applicant discontinued the appeal when he was unable to raise the required security.
Holding Redlich is pleased to have achieved success for Cabrini Health at each step of the process.
Lessons for employers
Employers can take into account a broad range of considerations when assessing whether it is reasonable in all of the circumstances to redeploy, including how well the employee will fit in the new team. Compelling reasons are required to avoid redeployment.
Where the applicant has already had their “day in court” and appeals the matter without adequate legal basis, it may be prudent to ensure they can pay your legal costs if they lose as expected. Seeking security may avoid the need to deal with the appeal.
Authors: Ben Marshall & Lauren Drummond
Benjamin Marshall, Partner
T: +61 3 9321 9864
Charles Power, Partner
T: +61 3 9321 9942
Stephen Trew, Managing Partner, Sydney
T: +61 2 8083 0439
Michael Selinger, Partner
T: +61 2 8083 0430
Rachel Drew, Partner
T: +61 7 3135 0617
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Published by Benjamin Marshall, Lauren Drummond