Manager claims employer failed to properly evaluate skills for available position
The Fair Work Commission (FWC) recently examined an unfair dismissal claim involving an account manager who argued her redundancy was not genuine after being denied redeployment to an available senior designer role.
The case arose when the worker was made redundant due to the company's financial difficulties, but she contested that reasonable redeployment options existed that were not properly considered by management.
The worker argued her dismissal was unfair, maintaining that she had the skills and qualifications to be redeployed to a senior brand designer position that became available around the time of her redundancy.
She contended that the employer failed to properly assess her suitability for the role and made a predetermined decision to exclude her from consideration without genuine consultation.
The employer contested the worker's claim, arguing the dismissal was a genuine redundancy due to financial pressures requiring cost reduction.
The employment relationship involved a worker employed as a full-time account manager at a salary of $80,000 per annum with a creative marketing agency based in Adelaide that provided marketing, website, branding and graphic design services primarily to charities and non-profit organisations.
At the time of dismissal, the company had nine employees and was experiencing significant financial difficulties.
The managing director gave evidence that in the first quarter of the 2024/25 financial year, the company reported a loss of $86,335.
During the following quarter, there was an improvement to a $4,000 profit in October 2024, followed by a $10,600 loss in November 2024. On 21 January 2025, draft financial reports showed the company had made a net loss of $78,497 on revenue of $370,538.
Due to cashflow concerns, the company had entered into a payment plan with the Australian Tax Office to pay taxes required from their October Business Activity Statement.
In mid-January 2025, the managing director reflected on these financial issues and on 28 January 2025, determined to make the worker's account manager position redundant to reduce costs.
The worker was not aware of the detail of the company's financial position and did not contest the evidence given about the financial difficulties.
Her work as account manager included coordinating client website migrations, interpreting technical information for clients, project coordination, task creation and management, quoting, client communication, and scheduling regular client meetings.
The worker accepted that her role requirements were redistributed to other staff following the redundancy decision.
Based on the evidence, the FWC accepted that the company "no longer required [the worker's] role to be performed by anyone because of changes in [the company's] financial position and the need to reduce costs."
However, the central issue became whether reasonable redeployment options existed that should have been offered to the worker.
The worker contended she should have been offered the role of senior brand designer, which involved specialist skills including representing organisational values through visual communication and applying brand persona across all media.
The managing director considered that the worker did not have the skills to step up to the senior brand designer role, believing she had general design skills that "fell short of the specialist skills needed."
He argued the worker lacked the "soft skills" required including strategic thinking and presenting to clients, feeling she would not take "CEOs and/or board members 'on a journey'" during presentations.
Significantly, the managing director conceded during evidence that "his mind was made up before he met with [the worker] and that the consultation was perfunctory.
This included the conclusion that [the worker] was not a suitable candidate for redeployment into the Senior Brand Designer role." He had only seen the worker's resume when she first applied for the account manager role and had not seen a portfolio of her design work.
The FWC found this approach problematic, noting: "The decision by [the managing director] to self-fetter a redeployment offer based on his own judgement with absolutely no consultation was a poor decision. The far safer option would have been to invite [the worker] to apply the role, allow her to put her case forward and consider her on merit."
The worker gave evidence that she held an Advanced Diploma in Graphic Design and Advertising and had extensive experience in graphic design, design coordination and client-facing communication.
She had performed work of a similar nature required for the brand designer role with a previous employer before joining the company and had previously led creative teams and collaborated with developers, designers and strategists.
The worker contended that her "multi-disciplinary experience supported her capacity to undertake the Senior Brand Designer role" and that the managing director's suggestion she lacked "soft skills" was an attempt to rationalise the decision not to consider her for redeployment.
She gave evidence that she possessed additional skills which, while not required in her current position, were relevant to the senior brand designer role.
Despite the managing director's concerns about the worker's capacity, on 4 February 2025 he provided her with an effusive reference lauding her "expertise in client management, overseeing project workflows, and coordinating with a remote development and design team" and "her ability to collaborate across disciplines, communicate effectively, and manage projects with precision."
The managing director later described this reference as "generous," which the FWC disputed after observing the worker present her case.
The FWC applied the test under section 389(2) of the Fair Work Act, which requires assessment of whether it would have been reasonable in all circumstances for the worker to be redeployed within the employer's enterprise.
The Commission found: "In this case I am persuaded that [the worker] held the majority of the skills to perform the Senior Brand Designer role and whilst she may have needed some support and/or coaching initially, it would have been reasonable in all the circumstances for [the worker] to be redeployed in that role."
The Commission was critical of the employer's approach, stating: "That process would also have allowed an opportunity to discuss any skill gaps and whether further training could allow any gap to be filled within a reasonable timeframe. That is a much more preferable approach than to reconstruct the facts post dismissal in order to justify the exclusion of [the worker] from consideration."
The FWC formed the view that the managing director "had a predetermined plan to remove [the worker] and engage a new Senior Brand Designer."
The Commission concluded: "I find that [the company] did not meet the requirements of s.389(2) of the Act... Having considered each of the factors detailed in s.389 of the Act, I have concluded that the dismissal of [the worker] was not a genuine redundancy as defined."
The FWC found the dismissal was "harsh, unjust and/or unreasonable" due to the failure to offer reasonable redeployment.
The FWC found the dismissal unfair under section 387 of the Fair Work Act, noting that while there was a valid reason for redundancy due to financial pressures, "it would have been reasonable in all the circumstances for [the worker] to be redeployed in the Senior Brand Designer role which was available at the time her dismissal was being contemplated."
The Commission accepted that the worker would have required a period to meet all role requirements, but believed "that period would not have been greater than 3 months, which I believe is reasonable."
The worker did not seek reinstatement, and the FWC was satisfied it was not appropriate in the circumstances.
The Commission assessed compensation based on the worker undertaking the senior brand designer role for 15 weeks had she not been dismissed, then discounted this by 33% to 10 weeks, considering the possibility she may not have met all requirements within a reasonable period.
The FWC concluded: "I believe that the compensation detailed below is appropriate, having regard to all of the circumstances of this matter and the considerations specified by the Act. I award compensation in the amount of $15,384 (or 10 weeks pay)."
The Commission allowed 28 days for payment, noting the company had not sought additional time to pay the compensation amount.
