In a significant win for employers facing redundancy costs, the Fair Work Commission (FWC) recently allowed Civmec Construction and Engineering Pty Ltd to completely eliminate a former employee’s six-week redundancy entitlement. The Commission found that Civmec had obtained “other acceptable employment” for Mr Syed Muhamad Hasan Raza Rizvi, an Electrical Projects Engineer, and exercised its discretion under section 120 of the Fair Work Act 2009 (Cth) to reduce the payment to nil. This decision provides a clear practical roadmap for employers looking to minimise redundancy payouts through proactive redeployment efforts.
How Section 120 Works in Practice
Section 120 allows employers to apply to the FWC to vary an employee’s redundancy pay entitlement under section 119—potentially down to zero—if they can show either that they have obtained “other acceptable employment” for the employee or that they cannot afford to pay. Once the preconditions are met, the FWC has broad discretion to determine an appropriate reduced amount, which becomes binding.
Importantly, there is no requirement to get FWC pre-approval before withholding payment. Employers can terminate employment on redundancy grounds, assert section 120 applies, and then lodge an application post-termination to seek retrospective confirmation. This approach carries some risk—if the FWC rejects the variation, the full redundancy plus interest must be paid—but it succeeded decisively for Civmec.
The Facts of the Case
Civmec employed Mr Rizvi from July 2023 until late November 2025 in the role of Electrical Projects Engineer, working on manufacturing projects at their Henderson site in Western Australia. With about 2.5 years of service, he was entitled to six weeks’ redundancy pay when those specific projects ended, making his role genuinely redundant. Rather than pay out immediately, Civmec identified an identical vacancy on the CSBP Sodium Cyanide construction project at a nearby site on Kwinana Beach Road—just 12km away, adding only four minutes to his commute from home (31 to 35 minutes total). Mr Rizvi had previously worked at CSBP, so he knew the location.
Civmec promptly offered him the role in writing, confirming it involved the same title, duties (electrical and instrumentation design and support), hours, base salary, and continuity of service, with an added incentive: a 10% project completion bonus not available in his prior position. The work would be office-based, carrying the same manual handling and ergonomic risks as before, with no exposure to hazardous substances like cyanide (thanks to a site HSE plan and multiple inductions). Despite this, Mr Rizvi rejected the offer outright, stating it was “unsuitable,” demanding an extra $50,000, ceasing attendance after 21 November, and insisting on full redundancy pay. Civmec gave him multiple deadlines to accept (19, 27, and 28 November), warned of a section 120 application, and terminated his employment effective 28 November 2025 via redundancy. They lodged the FWC application shortly after (C2025/12419), decided on the papers on 24 February 2026.
Why the FWC Ruled for Civmec
The FWC applied an objective test for “other acceptable employment” under section 120(1)(b)(i). This is not about whether the role feels acceptable to the employee—it’s an arm’s-length assessment of comparability. Here, the roles matched closely: identical position description and responsibilities, equivalent or better remuneration (with the bonus), minimal location change, preserved service entitlements, and no material shift in risk profile or working conditions. The Commission accepted Civmec’s uncontested evidence, including Google Maps for travel times and a generic position description proving duties were unchanged despite moving from manufacturing to construction projects.
Mr Rizvi’s main defence—that he lacked enough information to assess suitability—failed. Civmec had provided core details early (19 November email outlined role, pay, location, and bonus), and his explicit rejections preceded later queries for specifics like inductions and site maps (raised post-termination on 1 December). The FWC noted he had a duty to cooperate meaningfully and explore options, which he did not. While criticising Civmec’s “clumsy” communications (references to resignation), the Commission found multiple opportunities were given, making a full reduction to nil appropriate in the circumstances.
Practical Guidance for Employers
For employers navigating redundancies, this case underscores the value of rigorous redeployment processes. Start by documenting the genuine redundancy (job no longer required, plus section 389 consultation). Then, actively search internal vacancies, prioritising roles with matching skills, pay, status, hours, and location—external options work too if comparable. Make formal written offers including position descriptions, remuneration details, start dates, and any incentives, with reasonable deadlines (24-48 hours in urgent cases). If rejected, issue a clear redundancy termination letter citing section 120 grounds, withhold full payment, and file the FWC application immediately with strong evidence: emails, maps, witness statements, and role comparisons.
Anticipate employee resistance, such as claims of insufficient information—front-load basics to neutralise this. Distances under 30km or 30 minutes are typically unproblematic, and pay parity (or better) is crucial. Small businesses should note section 121 exemptions anyway. Risks remain: vague offers or poor processes can lead to FWC rejection and backdated full payouts plus interest, as seen in other cases. But Civmec demonstrates that when redeployment is objectively strong and well-documented, section 120 can save significant costs—tens of thousands in this instance—without unfair dismissal exposure, provided the offer is genuine.
This decision reinforces employer flexibility in restructures: act decisively, evidence everything, and leverage section 120 to protect your bottom line.
Civmec v Rizvi FWC 599
