Redundancy consultation and genuine redundancy preparation checklist
A redundancy is only a "genuine redundancy" (exempt from unfair dismissal) if consultation obligations are met and redeployment has been considered. This checklist is for Australian employment lawyers advising employers on the process.
This is a 12-step checklist for preparing a genuine redundancy process under the Fair Work Act 2009 — covering consultation obligations, redeployment, selection criteria, notice, severance pay under the NES, and tax treatment of the redundancy payment.
The checklist
Identify the operational reason for redundancy
Document the business case — loss of role, restructure, technology change, or site closure — and the affected positions.
Identify the applicable modern award or agreement
Find the consultation clause in the modern award or enterprise agreement covering the affected employees.
Trigger the consultation obligation
Start consultation as soon as a definite decision has been made. Consultation must be genuine, not a formality.
Prepare and issue the consultation pack
Prepare a written notice of changes, the reasons, the expected effects, and measures to avoid or minimise adverse effects.
Hold individual consultation meetings
Meet with each affected employee, allow a support person, and genuinely consider their feedback.
Assess redeployment opportunities
Identify alternative roles within the employer and its associated entities. Document the redeployment assessment.
Apply fair and documented selection criteria
Where positions are being pooled, use objective, non-discriminatory selection criteria.
Consider 15+ employees large-scale redundancy notification
If 15+ employees are to be dismissed, notify Services Australia and relevant unions at least as required.
Calculate notice and severance under the NES
Calculate notice based on continuous service and age, and severance using the NES scale (s 119) or higher under the award/agreement.
Apply any small business or transfer exceptions
Check small business (<15 employees) exception and transfer-of-business rules that modify severance.
Structure payment for ETP and tax treatment
Calculate the genuine redundancy tax-free amount, ETP cap, and Whole of Income Cap under ITAA 1997 Div 83.
Finalise termination, deeds of release, and support
Issue termination letters, pay accrued entitlements, and consider a deed of release and outplacement support.
When this checklist applies
Use when advising on any role redundancy, organisational restructure, or site closure.
Common pitfalls
- Skipping or formalising consultation — loses the genuine redundancy defence
- Missing the consultation clause in the applicable award or agreement
- Not assessing redeployment across associated entities
- Misapplying the NES severance scale for small business and transfer cases
- Incorrect tax treatment of the redundancy payment and ETP
Run this checklist on a real matter
Quillio drafts consultation packs, runs the redeployment assessment, and calculates NES severance and ETP tax on a live matter. See /practice-areas/employment-lawyers or start a free trial.
General guidance for redundancy consultation. Adapt for union-dense workplaces, large scale restructures, and executive exits.
Use this checklist on your matter.
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