When having to deal with the unfortunate reality of workplace redundancies, it’s important to ensure that communication strategies are robust and that consultation obligations are met.

According to AHRI’s September Quarterly Work Outlook report, the percentage of organisations planning redundancies increased to 27 per cent, up from 23 per cent in the June quarter.

This means many businesses are now navigating challenging conversations around restructures and redundancies, requiring heightened stakeholder engagement capabilities to ensure these processes are managed smoothly and with minimal disruption.

This is a topic AHRI will be discussing in more depth in a webinar on the 18th of September, where facilitators will discuss navigating organisational changes and ensuring legal compliance, while maintaining positive relations with employees, unions and other third parties.

Adam Libbis, Managing Director at The Consulting Space and one of the webinar facilitators, notes that restructures and redundancies are rarely well-received and almost always involve some collateral damage. 

To help mitigate the impact and maintain operational momentum, he emphasises that clarity is essential in managing these difficult situations.

“Restructures and redundancies can sometimes feel quite transactional, so we need to remember the human element to it,” says Libbis.

“It’s also very important for HR professionals to understand that all industrial activity is linked.  The consultation process surrounding a restructure may seem isolated, but how it is managed will impact other industrial activities – such as future bargaining and consultation processes.”

With this in mind, it’s crucial for HR practitioners to have a deep understanding of the organisation’s broader industrial strategy and ensure that the restructuring process is as closely aligned with that strategy as possible.

Understand your legal obligations

Even if you determine that a redundancy is in line with your broader organisational strategy, it’s important to proceed with caution and first consider your redeployment obligations, says Kathryn Dent, Partner at HWL Ebsworth Lawyers and member of AHRI’s IR/ER advisory panel.

“Ensure that the selection criteria is objective and can justify termination, especially if the employee is considered ‘high risk’ for other reasons, such as having exercised a workplace right, having protected attributes or being absent from work for any reason,” says Dent, who is also speaking at AHRI’s webinar. 

“Interrogate the business’ reasons for redundancy to ensure that the position really is no longer required and that this can be supported by the evidence.” 

A common mistake that Dent sees employers making is failing to properly explore redeployment options, to ensure the redundancy is considered “genuine” under the Fair Work Act 2009 for the purposes of avoid an unfair dismissal claim.

Many assume simply because the role no longer exists that the redundancy is genuine, but they may overlook the need to consider redeployment opportunities, including within “associated entities”, even those located overseas, she says.

Ensure employees have clarity on all the available options, says Libbis, especially when restructures and redundancies are part of a downsizing/rightsizing initiative.

“The consultation process surrounding a restructure may seem isolated, but how it is managed will impact other industrial activities – such as future bargaining and consultation processes.” – Adam Libbis, Managing Director, The Consulting Space

“Sometimes businesses might follow a ‘spill and fill’ process. The company might say, ‘There’s 100 of you, but we only need 50 because our cost base has blown out of proportion, so people need to reapply for their role.’

“It’s often not that a person is getting tapped on the shoulder and told their specific role is being made redundant, but they are often making a decision about whether they want to apply for a different role or whether they want to go into a career transition program, or another option that’s dictated by their organisation’s policies. It’s really important that people understand what pathway they are on.”

Dent encourages incorporating a robust understanding of the provisions in your organisation’s relevant industrial instruments, such as modern awards, enterprise agreements, contracts and policies.

“Consultation must be real and meaningful, not perfunctory. And when looking at what is [considered] ‘reasonable redeployment’, don’t make employees apply for the position if it is vacant and they have the skill set and qualifications. It should be offered to them.”

Dent says it’s also important not to make assumptions about the types of redeployment options that an employee will or won’t accept, such as a position that is lower in seniority or remuneration, or if [the new role requires] interstate/overseas [travel]. 

“These are not necessarily going to be acceptable reasons for not offering them the position,” she says.

If you’ve determined that a role meets the requirements of a genuine redundancy – which you can read about here – then the next step is to assess which industrial instrument you need to follow in terms of the appropriate consultation process to follow, says Libbis.

“[The employee] might be covered by an award, they might be covered by an EA, or, if they are award-free, it might be policy-based. Larger organisations tend to be EA-driven. Those instruments will map out how to deal with the communication of major change and your consultation obligations.”

Under most modern awards there will be a provision requiring consultation around workplace change which states that the employer must discuss the changes with affected employees and their representatives as soon as possible, as well as other obligations such as providing information in writing. 

When major change is taking place in a heavily unionised industry, such as teaching or nursing, you should always invite unions to be included in those conversations, says Libbis. Dent adds that such invitations may be necessary depending on industrial instruments or if there are over 15 or more positions being made redundant (as required by the Fair Work Act).

Employers must then consider any views presented by the employees or their representatives before making any final decisions.

Dent adds: “Don’t forget employees who are on parental leave also have rights to consultation under the Fair Work Act, in addition to any [rights] they may have under an industrial instrument.”

Read HRM’s ‘Complex conversation toolkit’ for useful tips.

Help employees put their best foot forward

A redundancy can feel like a grieving process for some people, says Libbis. 

“Stress impacts our ability to listen and cognate information. You’ve got to keep your message simple and then repeat it over and over again.

“This is especially important for safety-critical organisations. If you’re working in transport, railways, hospitals or health and staff are under stress, [your business could be] more prone to incidents happening.

“You need to bring respect and dignity for the people leaving the organisation. In terms of the employer branding, what you don’t want is people leaving and saying, ‘That was the worst experience I’ve ever been through. Don’t ever work there.”

When people are facing the stress of something like a ‘spill and fill’, it’s important to be clear about the processes they should follow and the options they have, because they might not be thinking clearly in these moments, he adds.

“It’s about making sure you’re not using corporate comms channels for a non-corporate workforce. Match your channels to your end target audience.” – Adam Libbis, Managing Director, The Consulting Space

“You’ve got to show them how to put their best foot forward.”

This comes down to effective and transparent leadership that follows the mantra: “Clear is kind”.

“I was once running a spill and fill which impacted a large amount of admin staff within an organisation. Around 250 staff had to reapply for roughly 130 roles. One of the senior executives, who was a fantastic person and really got on with his team, said to them, ‘Don’t worry. I’ll do what I can to fix this for you.’ 

“He had influence, but not enough to change the situation. What happened was that his employees didn’t take the application process seriously… and they all lost in the end. Bad news is bad, but ambiguity is the killer.”

The importance of over-communication

It’s important to diversify the communications channels you use when discussing high-stakes issues such as a redundancy or restructure, says Libbis.

This is particularly important for sectors where employees might be engaging in field and frontline work.

“HR and communications professionals sometimes make the mistake of thinking that [frontline workers] access their emails and read FAQ micro sites – they don’t. The way to communicate with a maintenance crew is to go to their early morning briefing at 6am and tell them,” says Libbis.

“It’s about making sure you’re not using corporate comms channels for a non-corporate workforce. Match your channels to your end target audience.”

The same goes for using ‘corporate speak’ during the redundancy conversation. It will more than likely leave a bad taste in their mouths. Speak with compassion and empathy, while also being clear and transparent about the facts of the matter.

Even if you’re working with knowledge workers, who are more likely to read corporate communications, it’s important to “have the courage” to have face-to-face conversations, says Libbis. 

And make sure your middle managers are equipped to have these conversations.

“One-way, didactic comms aren’t that effective. You need to ensure there’s a safety net of knowledge within that line management cohort for when employees start asking questions. Because, let’s be honest, when you’ve got 500 employees sitting in a town hall, they’re unlikely to speak up. You need to make sure managers know what’s going on so they can provide the right information to staff. 

“While there needs to be alignment with the C-suite – who need to show they are accountable and transparent – people tend to trust their direct managers a lot more… So my strategy is to make sure line managers know exactly what’s going on.”

Communicating with those who are left behind

Your communication strategy can’t end once the redundancies have been finalised. In some instances, employees who remain might require ongoing support and clarity of your organisation’s future direction.

“Survivor guilt is something you’ve got to manage – there may be people remaining who lost friends in that process and that can change the whole social dynamic at work.”

Read HRM’s article about managing survivor’s guilt following a redundancy.

It’s also a good opportunity to have an organisational reset, he adds.

“It’s about how to align interests. You can say, ‘Yes, we’ve been through a painful process but now we can reset with the team we’ve got and move forward together.’

“It’s about giving those who left a dignified exit and, for those who stayed, giving them a new vision for the future.”

Equip yourself with the knowledge, tools and confidence to manage redundancies, restructures and complex stakeholder engagement by signing up to AHRI’s webinar on 18th September 2024. AHRI members can sign up for free.

All information, content and materials available on this site are for general informational purposes only. The contents of this article do not constitute legal advice and should not be relied upon as such.