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Co-managers challenge improper consultation process amid redundancy

FWC addresses case of managers dismissed without proper consultation.

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The couple faced termination on September 1, 2023.
The managers sought testimonies from eight employees.
FWC deemed the dismissals harsh and unreasonable due to insufficient consultation.

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The Fair Work Commission (FWC) recently addressed a case involving two managers facing redundancy due to their employer’s financial woes. Jason Janus and Marianna Janusova, married co-managers formerly employed by Red Star Gold Coast Pty Ltd, alleged improper consultation under their relevant award, deeming their dismissals unjust and unreasonable.

Employment History

Commencing their roles as Motel Managers on January 24, 2023, the couple faced termination on September 1, 2023, citing business restructuring and building renovations. They received a mere one week’s notice instead of the standard consultation process.

Genuine Redundancy Dispute

Challenging the genuineness of their redundancy, the managers highlighted the existence of other employees performing their tasks and the absence of consultation regarding their dismissals. Conversely, the employer defended the redundancy as legitimate, attributing it to operational restructuring while acknowledging a failure to adhere to consultation obligations.

Legal Proceedings

During legal proceedings, the managers sought testimonies from eight employees, yet only five were approved. These included four executive decision-makers involved in the redundancy process and a casual receptionist. The employer’s financial manager provided insights into the financial rationale behind the redundancy, emphasizing cost-saving measures and operational changes.

Operational Restructuring

In August 2023, following a meeting with the overseas owner, the company opted to centralize management operations. This restructuring involved redistributing tasks among existing employees and centralizing certain functions to the Sydney office. The employer justified these changes based on financial data and operational requirements.

The court concluded that the managers’ redundancy stemmed from operational necessities rather than a lack of genuine need for their roles. Despite other employees assuming some tasks, the specific responsibilities of the Motel Manager position were deemed unnecessary by the company’s operational standards.

Consultation Flaws

However, the managers argued that while redundancy was inevitable, the employer’s consultation process was flawed. The FWC found that the termination letter provided to Janus on September 1, 2023, did not fulfill the consultation requirements stipulated in their award. Consequently, the FWC deemed the dismissals harsh and unreasonable due to insufficient consultation.

The FWC referred the case for further hearings to discuss remedies for the workers affected by the lack of proper consultation during the redundancy process.

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