Mater Misericordiae Ltd Trading as Mater - [2025] FWC 964

[2025] FWC 964

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.120—Redundancy pay

Mater Misericordiae Ltd Trading as Mater

(C2025/1921)

DEPUTY PRESIDENT LAKE

BRISBANE, 7 APRIL 2025

Variation of redundancy pay - alternative employment offered – no objection from affected employee – alternative employment acceptable – redundancy varied.

On 14 March 2025, Mater Misericordiae Ltd Trading as Mater (the Applicant) applied to the Fair Work Commission (the Commission) under s.120(2) of the Fair Work Act 2009 (the Act) to vary the redundancy entitlement of Ms Karen Hong to nil. The Applicant applies for variation on the basis that acceptable alternative employment has been obtained for Ms Hong.

Background

Ms Hong was employed with the Applicant in the role of RTO Educator – Curriculum Development.

On 30 January 2025, the Applicant began a consultation process in relation to restructuring its Education and Training business area. On 18 February 2025, a decision was made that curriculum development as a separate role was no longer required and the positions of RTO Educator – Curriculum Development would be made redundant.[1] The responsibilities for curriculum development would be absorbed into the existing roles of Educator.

On 18 February 2025, the Applicant was offered redeployment into a vacant Educator role. The Applicant accepted this offer of redeployment and signed the new contract on 28 February 2025.

On 20 March 2025, my Chambers contacted Ms Hong asking her to respond by close of business 27 March 2025 if she opposed to the variation application. No objection was received from Ms Hong.

Should the affected employees’ redundancy be varied?

I am satisfied that the Applicant no longer requires the role of RTO Educator – Curriculum Development to be performed by anyone, although it appears that some of the curriculum duties have been absorbed into the Educator role. Therefore, Ms Hong is entitled to a redundancy payment under s.119(1)(a) of the Act. Therefore, I must consider whether the Applicant has obtained acceptable employment for Ms Hong under s.120(1)(b)(i) of the Act.

Section 120 of the Act states as follows:
“120 Variation of redundancy pay for other employment or incapacity to pay

(1) This section applies if:

(a) an employee is entitled to be paid an amount of redundancy pay by the employer because of section 119; and

(b) the employer:
(i)obtains other acceptable employment for the employee; or
(ii)cannot pay the amount.

(2) On application by the employer, the FWC may determine that the amount of redundancy pay is reduced to a specified amount (which may be nil) that the FWC considers appropriate.
(3) The amount of redundancy pay to which the employee is entitled under section 119 is the reduced amount specified in the determination.”

Past Fair Work Commission decisions explain ‘other acceptable employment’ as the following:

This is assessed objectively. Other acceptable employment does not mean that the role must be acceptable to the employee. An employee’s prima facie entitlement to redundancy pay may be at risk if the employee refuses a role…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2025] FWC 964
Decision Date: 7 APRIL 2025

CaseChat Overview and Summary

The parties involved in the case were Mater Misericordiae Ltd, trading as Mater, and an employee who was subject to redundancy. The dispute centred around the variation of redundancy pay when alternative employment was offered to the affected employee, who did not object to the alternative role. The case was heard in the Fair Work Commission. The primary legal issues the court had to decide were whether the employer could vary the redundancy pay when offering alternative employment and if the alternative employment was acceptable to the employee.

The court examined whether the employer's offer of alternative employment constituted a genuine variation of the redundancy pay terms. The court noted that the employee did not object to the alternative employment, which suggested acceptance. The court found that the alternative employment was suitable and aligned with the employee's skills and qualifications, making it an acceptable variation of the redundancy terms. Given the employee's acceptance and the suitability of the alternative employment, the court ruled that the employer was justified in varying the redundancy pay.

In conclusion, the court determined that the employer could indeed vary the redundancy pay when offering alternative employment, provided the employee accepted the alternative role and it was suitable. The court found the alternative employment to be acceptable, leading to the variation of redundancy pay. The decision underscores the importance of employee acceptance and the suitability of alternative employment in determining the validity of a redundancy pay variation. The final orders reflected the court's determination that the employer's variation of the redundancy pay was lawful and justified under the circumstances.

Orders