Workers insist on redeployment as employer cuts costs
The Fair Work Commission (FWC) recently dealt with a case involving two workers who argued an unfair dismissal from work as there was no genuine redundancy of their roles.
In its defence, the employer said that the reduction of labour was made to reduce the cost base of the company.
Was there a genuine redundancy?
Prior to their dismissal, the first worker was employed in the company as a senior unity developer, while the second worker was a games designer.
The company they were working for was established in 2018 as a technology startup with 7 employees and launched its first online game called Gods Unchained (GU).
The company is a global blockchain with around 300 workers globally working under two core business ventures.
Around May 2022, the company’s executive management team discussed the functional and process accountabilities in one of the company’s business ventures.
During the discussion, the team discovered that the cost base of the game surpassed sustainable revenues and was not operating sustainably.
Labour cuts for costs
Because it was already unprofitable, the employer decided to reduce the cost base including cutting the labour in the company.
“This led to a decision that the total headcount needed to be reduced by 18 roles, including 15 roles,” the FWC stated.
The 15 roles included the roles held by the workers who were later notified of the termination of their employment in late July 2022.
The two workers primarily argued that the company had not demonstrated that their roles were no longer required due to genuine changes in its operational requirements.
They further said that one way or another, it would have been reasonable for the workers to be redeployed within the company’s business.
However, despite such claims, the employer argued that the employment of the workers came to an end because of genuine redundancy. Hence, no unfair dismissal occurred.
FWC’s decision
After examining the case, the Commission was satisfied that the worker’s dismissals were cases of genuine redundancy, and the workers were not unfairly dismissed.
The FWC was satisfied that the company no longer required the jobs performed by the workers because of changes in its operational requirement.
It further noted that the relevant operational requirement of the company was a business decision to reduce costs as the GU was no longer profitable.
With regards to the workers’ argument that they could have been redeployed within the employer’s enterprise, the Commission noted that both workers later accepted in the cross-examination that there were no suitable roles available at that time.
