What are your rights if AI replaces your role?

Artificial intelligence is quickly changing how Australian businesses operate. If automation removes or substantially changes your job, your employer may be able to make your role redundant. However, it is important to note that being replaced by AI, does not displace the ordinary protections available under Australian workplace laws.

Can an Employer Replace a Role with AI?

Generally, yes an employer may restructure its operations or introduce technology, including AI which can be used to replace the role of an individual. However, if that change leads to dismissal, the employer must comply with their obligations under the Fair Work Act 2009 (Cth) (Act), the National Employment Standards (NES) and any applicable modern award, enterprise agreement or employment contract.

Is the Redundancy Genuine?

A dismissal may be a genuine redundancy where the employer no longer requires your job to be performed by anyone because of changed operational requirements. The focus is on the job, and not simply the employee. AI may perform all or part of the work ordinarily completed, or redistribute the remaining duties accordingly, but the employer should be able to explain the genuine operational change.

A redundancy may not be genuine in the following circumstances:

• If substantially, the same job still exists;
• The required consultation was not followed; or
• It would have been reasonable to redeploy you within the employer’s business or an associated entity.

In the event that the process appears to be designed to mask a performance issue, personal conflict or prohibited reason, it is recommended to obtain legal advice promptly.

Your Right to Consultation

Most modern awards and enterprise agreements will require consultation prior to any major workplace changes being implemented. Depending on the industrial instrument, an employer may need to notify the affected employees, provide relevant information, discuss likely impacts and measures to reduce any adverse effects, allow representation, and genuinely consider the employees’ responses. Consultation should occur while proposals can still be influenced, and not after the decision has been made.

Redeployment and Alternative Work

Before relying on genuine redundancy, an employer should consider whether reasonable redeployment is available within its organisation or an associated entity. Relevant factors include available roles or work, the employees’ skills and experience, any required qualifications, location, remuneration and the surrounding circumstances. A role with lower pay or responsibility may still warrant consideration, where the employee can decide whether it is acceptable.

Notice, Redundancy Pay and Final Entitlements

If your employment ends, you may be entitled to, depending on your circumstances, written notice or payment in lieu, redundancy pay based on continuous service, and payment of outstanding wages and accrued entitlements. Exceptions can apply, including for some casuals, employees with short service, fixed-term arrangements and employees of small businesses.

What if AI Influenced the Decision Unfairly?

Using an algorithm does not excuse an employer’s unlawful decision-making. If AI was used to select employees for redundancy, the criteria and outcome may still be challenged where they involve prohibited discrimination, adverse action for exercising a workplace right, or another unlawful reason. Warning signs may include:

• Unexplained scoring;
• Inaccurate data;
• Inconsistent treatment; or
• Criteria that disadvantages people because of a protected attribute.

What Should Employees Do?

1. Ask for the business reasons, proposed timing and impact on your role in writing.
2. Check your award, enterprise agreement, contract and workplace policies for any requirements or entitlements.
3. Identify vacancies, transferable skills, retraining options and reasonable adjustments to be considered.
4. Keep copies of consultation materials, correspondence, position descriptions and payment calculations.
5. Do not sign a release or deed before understanding its effect and obtaining legal advice.
6. Act quickly. An unfair dismissal application with the Fair Work Commission must be lodged within 21 days of the dismissal taking effect.

Key Takeaways for Employees

• AI can be a genuine operational reason to abolish a role, but the usual workplace protections still apply.
• Your employer may need to consult you before implementing major technological changes.
• A dismissal is not a genuine redundancy if reasonable redeployment options were available.
• You may be entitled to notice; redundancy pay and other final entitlements.
• AI-assisted selection may still breach discrimination and general protections laws.
• Strict time limits apply, so seek advice promptly.

We’re with You

At Chamberlains Law Firm, we help businesses navigate the complexities of termination, contractor agreements and workplace compliance. Our workplace lawyers can review your contracts, advise on termination risks and represent you in disputes. Whether you need updated templates, compliance advice or support managing a workplace dispute, our Workplace Law Team is here to help.