The Case: Helensburgh Coal Pty Ltd v Bartley & Ors (August 2025)

The High Court of Australia recently delivered a major decision in the Helensburgh Coal case, radically shifting the legal landscape around “genuine redundancy.” Helensburgh Coal, operating a coal mine in NSW, restructured in 2020 due to COVID-19 impacts and reduced coal demand. Despite ongoing use of contractors, 22 employees were made redundant and challenged the dismissals via unfair dismissal claims, arguing they could have been redeployed into roles handled by those contractors.

Key Legal Question

The central issue was whether, under section 389 of the Fair Work Act 2009, an employer must consider whether redundant employees could reasonably be redeployed into roles currently performed by contractors, not just into existing vacancies.

The High Court Decision

• The High Court unanimously dismissed Helensburgh Coal’s appeal, finding that the Fair Work Commission (FWC) was right to consider whether the employer could have changed its operations to create redeployment opportunities for employees—such as by replacing contractors with those facing redundancy.
• It clarified that “genuine redundancy” is not limited to the absence of vacancies but also includes reasonable possibilities for redeployment, even if that requires operational or contractual changes.
• The Court emphasized a “reasonable in all the circumstances” test: Employers must actively assess possibilities for redeploying employees into contractor roles, considering whether roles could be made available through changes in workforce arrangements or upcoming vacancies.

Real-World Effects on Employers

• Raised Bar for Genuine Redundancy: Employers must do more than search for vacancies; they must also consider redeployment into roles currently done by contractors, especially if the work is not highly specialised or could be performed with minimal retraining.
• Employers can be required to review and potentially change contracts with labour hire providers or contractors to allow for redeployment of employees.
• Merely retaining contractors while making employees redundant may now expose companies to expensive unfair dismissal claims if reasonable redeployment was possible.
• For a redundancy to be genuine, employers must document and evidence a thorough assessment of possible operational or contractual changes that could have saved jobs.
• Decisions related to workforce structure—outsourcing, insourcing, or reorganisation—must be transparent and justifiable, considering future vacancies or roles that could be created by ending contractor agreements.
• Employers should review redundancy, outsourcing, and redeployment policies to ensure clear compliance with expanded legal obligations.

Practical Guidance

Employers must:

• Consider internal redeployment not just for current vacancies but for roles that could be created by insourcing or reworking operations.
• Be prepared to show why retaining a contractor is more reasonable than redeploying an employee, including factors like the specialisation of the work and training needs.
• Make sure consultation obligations are robust and well-documented, reflecting a real attempt to avoid redundancy if reasonable alternatives exist.

This ruling is a clear wake-up call for employers, making redundancy processes more rigorous and employee-focused, and requiring deeper consideration of restructuring impacts beyond mere operational convenience.