Tuesday, 2 September 2014

Redundancies During Pregnancy and Maternity Leave Not Always Discriminatory Says Federal Court

Employer cleared of pregnancy discrimination but fined for ‘tardy response’ to flexible work requests

The Federal court has ruled a not-for-profit organisation did not discriminate against two pregnant employees whose positions were made redundant while they were on parental leave. However, it did fine the employer a total of $6,500 for failing to respond to their requests for changed working arrangements within 21 days as required under the Fair Work Act 2009 (Cth), despite the errors being inadvertent.

The first employee, a marketing and events manager had informed her employer in August 2009 of her pregnancy several months before an organisational restructure resulted in a change to her reporting lines. The employee then commenced a period of parental leave in February 2010, and later sought to enter into return to work arrangements but was informed that her position was no longer required. The other employee, a facilities manager went on parental leave in August 2011 also following a restructure in her department and contacted the employer to discuss her return to work before being informed her position was redundant. In both cases, as no suitable alternative roles could be identified the employees were retrenched.

No Discrimination

Justice White dismissed the employees’ claims that they had been ‘targeted’ by management for dismissal after announcing their pregnancies and that the redundancies were brought about by their pregnancies rather than restructuring operations.

In relation to the first employee, he ruled the reason for making redundant the then manager of marketing and events was ‘entirely unrelated’ to her pregnancy and that the employer only became aware during her absence that it could manage satisfactorily without her employment. It was found the manager’s absence created a circumstance where the employer concluded it no longer required the role to be performed as her duties could be ‘easily absorbed’ by other staff involved in implementing a change in organisational focus.

In relation to the second employee, the Court was satisfied, that the departure of a key executive and period of significant growth gave rise to a need for different management and operational skills. These, amongst other changes, had occurred in the employee’s department ‘which although contemporaneous’ with her pregnancy and parental leave, were ‘not, other than in minor respects, a consequence of her pregnancy.’

While in this instance the Court found no discrimination occurred, the case demonstrates a Court will not hesitate to scrutinise the reasons which underpin a decision to implement major workplace change. It is therefore critical employers have a strong business case and adopt non-discriminatory criteria when selecting employees for redundancy to minimise the likelihood of a successful claim. Finally, as this cases shows, employers will be held to strict timeframes when dealing with requests for changed working arrangements by eligible employees and ensure they respond promptly to avoid penalties.

HR Legal works with employers on redundancy and restructuring strategies to meet commercial needs. Please contact us if you require assistance in this area.


This article was produced by HR Legal. It is intended to provide general information only in summary format on legal issues. It does not constitute legal advice, and should not be relied on as such.

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