By: Laura Gavan and Kirsty Easdale

Helensburgh Coal Pty Ltd v Bartley [2025] HCA 29

The High Court of Australia has recently clarified the scope of an employer’s redeployment obligations where an employer seeks to defend an alleged unfair dismissal on the basis of genuine redundancy. In Helensburgh Coal Pty Ltd v Bartley [2025] HCA 29, the High Court confirmed that, in considering whether an employer has met its redeployment obligations under section 389(2) of the Fair Work Act 2009 (Cth) (FW Act), the Fair Work Commission (FWC) may consider whether the employer ought to have made changes to how it uses its workforce to operate its business.

Background

Helensburgh Coal (Helensburgh) operates the Metropolitan Coal Mine in the Illawarra region of New South Wales. During the COVID-19 pandemic, there was a significant drop in the price of coking coal. Helensburgh decided to reduce production on this basis, and took steps to downsize its workforce.

Helensburgh had contracted with two companies to provide labour. By June 2020, Helensburgh had reduced its contractor workforce by 40%, and terminated the employment of 90 employees. 47 of those 90 employees were made involuntarily redundant, and 22 of those employees filed unfair dismissal applications with the FWC (Employees).

What does the legislation say?

Section 389 of the FW Act defines ‘genuine redundancy’ as follows:

A person’s dismissal was a case of genuine redundancy if:

• the person’s employer no longer required the person’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise, and
• the employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.

A person’s dismissal was not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within:

• the employer’s enterprise, or
• the enterprise of an associated entity of the employer.

First instance decision

Helensburgh made a jurisdictional objection to the applications on the basis that the Employees were not unfairly dismissed as they were ‘genuinely redundant’ within the meaning of section 389. The Employees’ position was that Helensburgh ought to have redeployed them into roles performed by contractors, and as such Helensburgh had not met the requirements for a genuine redundancy.

At first instance, Commissioner Riordan of the FWC agreed with the Employees and found that it would have been reasonable in all the circumstances to redeploy the Employees into roles held by contractors.

What did the High Court say?

After three more decisions in the FWC and one in the Full Federal Court against Helensburgh, special leave was granted by the High Court. The High Court dismissed the appeal and unanimously held that the FWC is entitled to consider whether an employer could have made changes to how it uses its workforce, including replacing contractors with employees, when assessing if a redundancy is genuine.

Until this decision, in assessing whether redeployment could reasonably have occurred, the FWC and Courts had confined themselves to an inquiry of whether an employee could have been placed in a vacant position already existing at the time of the dismissal, and whether the redundant employee had the skills, qualifications and experience to perform the available jobs. Helensburgh marks a considerable departure from this position, and the obligation to redeploy is no longer tied to whether there is a vacant position.

The question is instead whether there is ‘work, or a demand for work, within the employer’s enterprise or an associated entity’s enterprise that could have been performed by the otherwise redundant employee’, and whether redeployment into that work would, in all the circumstances, be reasonable.

The High Court has said that in making this inquiry, the FWC must:

• not disregard the nature and context of the employer’s ‘business, activity, project or undertaking’. The FWC cannot demand changes to an employer’s core functions or essential operations, and
• take into account the employer’s policies, risk appetite, plans, processes, procedures, business choices (such as the nature of the workforce – blended or otherwise), contract terms, further training requirements, and anticipated changes in the workforce.

The judgements of Edelman and Steward JJ also suggest that where there is a proposal that contractors be displaced for a potentially redundant employee, the FWC ought to also have regard to the extent of any legal obligations on the employer to continue using the contractors, and the effect of such a decision on the contracted workers.

The High Court did, helpfully, confirm that where an employer has decided that, due to operational requirements, it no longer requires the work performed by an employee to be performed by anyone, it does not need to prove that this was a reasonable decision. It is enough that the decision was made.

What does this mean for employers and insureds?

This decision highlights the importance of employers and insureds fully understanding the breadth of redeployment obligations in an unfair dismissal context. This has historically been an area of legal risk, for example, with some employers not considering redeployment roles of lower pay and status, or roles for which an employee would be suited with a reasonable period of retraining.

The High Court’s decision in Helensburgh takes this further, to require (in appropriate cases) consideration of roles being performed by contractors. However, it is important to keep in mind the following caveat. The obligation to redeploy is tied to establishing the defence of genuine redundancy in the unfair dismissal jurisdiction. There is no positive obligation on employers to redeploy redundant employees who earn over the high income threshold and are not covered by an Award or enterprise agreement.

This decision does not compel employers to terminate contractor engagements as a means to avoid redundancy in every case, only where it is reasonable in all of the circumstances. This will depend on the terms of the contractor’s engagement and the suitability of the employee to perform the contractor’s role.

Employers should consider whether their workforce strategy, and in particular, any decision to utilise a combination of contractors and employees, has been clearly documented in any policies, procedures or plans. Where applicable, such documentation should clearly set out if contractors have been engaged to perform specialised work that the employee workforce does not have the skills and experience to complete.

It will also be prudent for employers to document their efforts to redeploy employees prior to implementing any redundancy-related dismissals, based on a broad consideration of the available work within their enterprise, or the enterprise of any associated entity.

On the whole, restructures have become more complicated following this decision and our team is on hand to help employers make decisions that reduce their risk and limit legal exposure.

Key Contacts & Updates

For guidance on workplace issues, please contact Chris Mossman, Sian Gilbert, Laura Gavan or Kirsty Easdale.

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