07 Aug Case Brief: High Court Confirms Redundancy Obligations in Recent Decision
In the recent landmark decision of Helensburgh Coal Pty Ltd v Bartley [2025] HCA 29 (6 August 2025), the High Court of Australia (“HCA”) upheld the Fair Work Commission’s (“FWC”) finding that the dismissals were not a case of genuine redundancy under section 389 of the Fair Work Act 2009 (Cth). The HCA confirmed that mining giant, Peabody, had failed to comply with section 389(2) by not properly considering whether the dismissed employees could have been reasonably redeployed into roles being performed by external contractors, which may have been available within the employer’s enterprise.
BACKGROUND
In 2020, Peabody made 22 workers at its Helensburgh coal mine redundant (“Workers”). The Workers subsequently brought unfair dismissal claims against Peabody. Peabody claimed that the dismissals were cases of “genuine redundancy” pursuant to section 389 of the Fair Work Act.
THE LAW
Under section 389 of the Fair Work Act, a person’s dismissal is a case of genuine redundancy if:
• the person’s employer no longer required the person’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise; and
• the employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.
• the employer considered whether it would have been reasonable in all the circumstances for the person to be redeployed within the employer’s enterprise or the enterprise of an associated entity of the employer.
FWC DECISION
The FWC ultimately held that the terminations were not cases of “genuine redundancy” because it would have been reasonable in all the circumstances for the Workers to be redeployed to perform the work that was being performed by the Contractors.
Peabody challenged this decision, appealing it to the Federal Court of Australia in the first instance. The decision was ultimately appealed to the HCA (“Appeal”). The principal question for the HCA to consider in the Appeal was whether the FWC could consider other ways an employer might use its workforce to operate its enterprise, as part of the inquiry under s 389(2) of the Fair Work Act.
HCA FINDING
The HCA denied the Appeal and held that the FWC had not erred in inquiring into whether Helensburgh could have made changes to how it uses its workforce to operate its enterprise. Specifically, the HCA found that the FWC was permitted by s 389(2) of the Fair Work Act to undertake an inquiry into whether an employer could have made changes to how the employer uses its workforce to operate its enterprise, in order to make a finding on whether section 389(2) of the Fair Work Act has been satisfied.
Gageler CJ, Gordon J and Beech-Jones J provided at [40] of the decision:
“The language of s 389 does not prohibit asking 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 a person who would otherwise have been redundant. None of the statutory language, context or purpose supports such a proscriptive rule.”
Accordingly, the HCA dismissed Peabody’s Appeal.
WHAT DOES THIS MEAN FOR EMPLOYERS?
This case highlights that employers must seriously consider all redeployment options before making workers redundant. This includes roles performed by contractors.
Additionally, this case highlights the FWC’s power to question business decisions in redundancy cases to ensure the process followed and decision made is fair, balancing the competing needs of the employer and employee.
To read the case, click on the link below.
If you are considering making any employees redundant and require advice, please contact HR Law on info@hrlaw.com.au. Our lawyers have extensive experience in advising employers on all aspects of the redundancy process.
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