Time To Learn Your ABC’s: English Proficiency Is a Valid Factor For a Genuine Redundancy

When making an employee redundant, employers are obligated to satisfy the ‘genuine redundancy’ benchmark imposed by section 389 of the Fair Work Act 2009 (Cth). A failure to meet this requirement may render the redundancy as ‘not genuine’ and may expose an employer to an unfair dismissal claim. Learn more about the criteria of a ‘genuine redundancy’ here: Making a role redundant? Here’s what you need to look out for.

Commonly, when seeking to downsize their workforce, an employer may wish to reduce the number of staff employed in the same position or department.  As such, the employer may undertake an assessment of all relevant employees, taking a range of factors into account i.e. the employee’s skills, performance and capabilities to ultimately determine which employee/s should be made redundant.  However, this assessment can often land employers in hot water if it does not adequately satisfy a ‘genuine redundancy’.

The Fair Work Commission (FWC) has provided employers with further clarity on what factors are lawful considerations for determining a ‘genuine redundancy’ in the decision of Qian Tang v Hisense Australia Pty Ltd [2024] FWC 2259. In this case, Qian Tang (the Applicant) was made redundant and subsequently made an unfair dismissal claim on the basis that the Applicant’s dismissal was not a genuine redundancy. The Applicant was employed by Hisense Australia Pty Ltd ((Employer) as a Human Resources (HR) Business Manager. Upon returning from parental leave, the Applicant was informed that the Employer was undergoing structural change and Applicant’s role was no longer required. As an alternative to the proposed redundancy, the Employer offered the Applicant redeployment in a casual position. However, the Applicant declined the proposal, stating that the proposed redundancy does not ‘align with genuine redundancy criteria’. The Applicant claimed that she was targeted, having recently become a new mother and taken parental leave.

Reasons for Genuine Redundancy:

However, a key consideration for the FWC in this judgment concerned the context of the Employer’s business operations. The Employer noted that the nature of the structural changes involved downsizing the HR Department by reducing the number of HR employees.  As a company situated in China and Australia, the Employer outlined the importance of its Human Resources employees being proficient in both Mandarin and English when interviewing potential candidates. The Employer reported that the Applicant scored the lowest out of the other three (3) Human Resource employees in recruitment experience, communication skills and English proficiency. The FWC Commission accepted evidence from the Employer submitting that the Applicant was “unconfident about her English skills, … rarely held interviews with native English speakers” and “turned down opportunities to interview [native English speaker candidates]”[1].

The FWC accepted that as a Human Resources Business Manager, the Applicant’s lack of proficiency in English and experience with hiring English-speaking candidates was a valid factor which satisfied a genuine redundancy.  The FWC also concluded that the Employer satisfied its obligations to inform the Applicant of the impact of the structural change on her employment and provide a reasonable redeployment opportunity (which the Applicant rejected).  Accordingly, as the Applicant’s redundancy was deemed ‘genuine’, the Employer had lawfully dismissed the Applicant and the Applicant’s claim was dismissed.

Key Takeaways

This case provides much needed clarity as to what factors can be lawfully considered during the redundancy process. However, redundancy processes are rarely straightforward and often complex to navigate with various issues, business objectives and employee rights differing depending on the industrial instrument specific to each employee.

If you are restructuring and considering making any staff redundant, you should obtain legal advice in relation to “genuine redundancies” and the redundancy process to ensure you minimise the risk of an employee having a successful Adverse Action or Unfair Dismissal Claim against your business.

Contact our Workplace Law Team for quality advice you can trust and assistance with implementing robust strategies to protect your business.

[1] Qian Tang v Hisense Australia Pty Ltd [2024] FWC 2259 [23]