Lawfully Managing Redundancy Before Maternity Leave In Australia

Facing a restructure when a team member is about to take maternity leave is a situation many small business owners dread. You want to do the right thing by your people, but you also need to make commercial decisions to keep your business viable.

Can you make a role redundant before maternity leave starts in Australia? Yes - but only if it’s a genuine redundancy and you follow a careful, compliant process. If you don’t, you risk costly disputes, discrimination claims and unfair dismissal risks.

This guide steps you through what “genuine redundancy” actually means, what you must do procedurally (consultation, redeployment and notice), how entitlements work, and practical tips to reduce risk when the timing is close to parental leave.

Can You Make An Employee Redundant Before Maternity Leave Starts?

In Australia, there’s no blanket ban on redundancy before parental leave begins. However, the law is crystal clear on two points:

• The redundancy must be “genuine” - the job is no longer required to be done by anyone, and redeployment isn’t reasonable.
• The decision must not be because of pregnancy, a request for parental leave, or any other protected reason (e.g. temporary absence due to illness or injury).

Practically, this means your restructure decision should be driven by business needs (for example, a downturn, a change in operations, or technology making a position unnecessary), not by the employee’s impending leave.

Timing alone doesn’t make a redundancy unlawful. What matters is your reason, your process and your evidence. If you can show a documented business case, genuine consultation and that you explored redeployment, you’re in a much stronger position.

What Counts As A Genuine Redundancy Under The Fair Work Framework?

Genuine redundancy has three core elements:

1) The Job Is No Longer Required

You’ve changed the operational requirements of your business so the role truly isn’t needed. Examples include merging teams, automating tasks, exiting a product line, closing a site, or permanently reallocating functions without increasing another employee’s workload unreasonably.

2) Award/Agreement Consultation Has Occurred

Most modern awards and enterprise agreements require employers to consult about major workplace changes. This means you must notify the affected employee(s), share relevant information about the change, invite their input, and genuinely consider feedback before making a final decision.

3) Redeployment Isn’t Reasonable

You must actively consider whether there are any suitable alternative positions within your business (or associated entities, if applicable). Suitability is assessed against the employee’s skills and experience, with reasonable training considered.

Offering or genuinely assessing redeployment options is a critical step. If you skip it, the redundancy may not be considered genuine, exposing you to unfair dismissal risk.

Small Business Considerations

Small businesses (fewer than 15 employees) are exempt from redundancy pay under the National Employment Standards (NES), but the redundancy must still be genuine and non-discriminatory. You still need to consult if an award/enterprise agreement applies, and you still need to provide statutory notice (or pay in lieu). The exemption does not protect against discrimination or adverse action claims.

Managing Timing, Consultation And Redeployment Obligations

When the timing is close to maternity leave, your process and communication matter even more. Here’s how to approach it with care:

Start With a Clear Business Case

• Prepare a short document outlining the operational change, financial drivers, and why the role(s) are no longer required.
• Record alternatives you considered (e.g. reducing hours, team restructure, hiring freeze) and why they aren’t viable.

Having the business case ready before you start consultation helps demonstrate your genuine reasons are unrelated to pregnancy or leave.

Consult Early And Genuinely

Follow any consultation terms in the relevant award or enterprise agreement. Typically, this involves:

• Writing to the employee with details of the proposed change and its likely impact.
• Meeting (or offering a meeting) to discuss the change, answer questions and invite suggestions to mitigate the impact.
• Allowing a reasonable opportunity to respond, then considering that feedback in good faith.

Document each step. If the employee proposes alternatives that could avoid redundancy, assess them and record your reasoning.

Actively Explore Redeployment

• Identify any available or upcoming roles that could be suitable, including at a different classification level if reasonable.
• Be open to reasonable training. If a short upskilling pathway would make the employee suitable, consider it.
• If a role is available on different terms (e.g. part-time or different location), make a written offer so the employee can consider it.

Keep notes of roles considered, why they were or weren’t suitable, and any offers made. A clear redeployment log is strong evidence of a genuine process.

Be Mindful Of The Leave Interface

If the redundancy will occur just before parental leave, be especially clear in your communications that the decision relates to the restructure - not the pregnancy or leave. Where possible, complete consultation well before the leave is due to start to avoid confusion about the reason for the decision.

If the employee has already applied for parental leave, it’s fine to proceed with a genuine redundancy - but ensure your process (and your paperwork) speaks to the operational reasons and the steps you took to consult and consider redeployment.

Pay, Notice And Entitlements When Redundancy Occurs Near Parental Leave

When a redundancy proceeds, the usual termination entitlements apply. The key components are:

Notice (Or Pay In Lieu)

You must provide statutory notice based on the employee’s service, or make a Payment In Lieu Of Notice. Awards or contracts may require more than the NES minimum.

Redundancy Pay

Under the NES, redundancy pay is based on years of continuous service (small business exemption may apply). Review obligations carefully and calculate the correct redundancy payment for the employee’s service period.

Accrued But Unused Leave

• Accrued annual leave must be paid out on termination. If relevant, include leave loading in accordance with the contract or award.
• Long service leave entitlements depend on state/territory law and the employee’s service (pay out any pro-rata entitlement if applicable).

Sick/Carer’s Leave Balances

Unused personal/carer’s leave is generally not paid out, but there can be questions where redundancy overlaps with existing medical certificates or absences. If this comes up, review your obligations and consider this guide on redundancy and sick leave.

Superannuation On Termination Payments

Super is generally not payable on genuine redundancy pay, but it can be payable on some termination components (e.g. notice paid as normal earnings). Check your obligations regarding superannuation on termination payments and, where relevant, payment in lieu and superannuation.

Final Pay Timing And Itemisation

Pay all amounts owing by the required date (often on or soon after termination under the applicable award/EA). Provide an itemised payslip or statement so the employee can see how each amount was calculated. This article walks through the key components of final pay for Australian employers.

Risk Management: Discrimination, Adverse Action And Evidence

When redundancy intersects with pregnancy or parental leave, the biggest risks are discrimination and general protections claims (adverse action). Here’s how to reduce exposure.

Separate “Reason” From “Timing”

Make sure your documentation tells a consistent story: the role is redundant because of operational change, not because the employee is pregnant or taking leave. If other roles are affected, note this. If you considered alternatives, keep the paper trail.

Keep A Clean Consultation Record

Retain copies of consultation letters, meeting notes, follow-up emails and your responses to suggestions. If you adopted any proposals to mitigate the impact, record them.

Evidence Your Redeployment Steps

Maintain a list of roles considered across the business (and related entities if applicable), why they were suitable or not, and any offers made. If the employee declined a reasonable offer, keep that response.

Be Consistent In Messaging

All decision-makers and managers should use the same, accurate rationale. Mixed messages can create the impression of an improper motive.

Consider Alternatives Where Viable

If a less impactful alternative could achieve the same business outcome - such as reassigning duties, changing rosters or reducing hours by agreement - explore it and record that assessment. If those options aren’t viable, note why.

Practical Steps And Documents For Employers

Bringing structure to your process helps you stay compliant and fair. Below is a practical roadmap and the documents that typically support each step.

Step-By-Step Process

1. Prepare the Business Case: Write a short justification for the restructure, including financial/operational drivers and roles affected.
2. Check Industrial Instruments: Identify applicable modern awards or enterprise agreements and extract consultation obligations and timeframes.
3. Map Redeployment Options: Audit available and upcoming roles, consider reasonable training, and plan any offers you can put forward.
4. Commence Consultation: Issue a written notification, schedule meetings, invite feedback and proposals, and consider them in good faith.
5. Decide And Confirm In Writing: If proceeding, issue a termination letter setting out notice (or pay in lieu), redundancy pay (if applicable), leave payouts and return of property requirements.
6. Process Final Pay And Records: Pay all amounts owing, provide itemised payslip/statement, and update employee records and payroll.

Helpful Documents And Policies

• Employment Contract: Sets out notice, redundancy interaction with any contractual entitlements, and return of property. If your template is outdated, consider updating your Employment Contract before future hires.
• Consultation Letter Pack: A consistent set of communications for proposed change, invitation to consult, and outcomes. Many employers use a tailored termination documents suite to ensure compliant wording.
• Redundancy Calculation Worksheet: A simple spreadsheet or HRIS report to compute service-based redundancy pay where applicable.
• Final Pay Checklist: A process to capture notice (or pay in lieu), redundancy pay, leave payouts, deductions, and super treatment - aligned with your final pay obligations.
• Workplace Policy: Clear policies about consultation, redeployment, and respectful communications during change can help keep managers aligned; if you don’t have one, a tailored Workplace Policy can be useful.

Common Questions We Hear From Employers

What if the role might return after parental leave? If the operational change is temporary, a fixed-term arrangement or backfill may be more appropriate than redundancy. Redundancy must reflect a genuine, ongoing change to operational requirements.

What if the employee asks to start maternity leave earlier because of the restructure? You should still complete your consultation and decision-making on the merits. Parental leave timing isn’t a legal shortcut for either side - the redundancy must be justified regardless.

What if the employee resigns during or after the process? Normal termination processes apply, but be mindful of accrued entitlements and any resignation during parental leave scenarios addressed in this guide to resignation during maternity leave.

Avoiding Pitfalls When Redundancy Is Close To Maternity Leave

When the timing is sensitive, extra care pays off. Build these safeguards into your plan:

• Sequence matters: Develop the business case and role impact analysis before any conversation about leave dates to avoid the perception that leave triggered the decision.
• Use neutral, consistent language: Communications should focus on business needs and structural change, not personal circumstances.
• Don’t shortcut redeployment: Even if you believe no roles exist, run and record the search. Offer what you can, even if it’s different hours or location.
• Be transparent about entitlements: Include clear calculations for notice, redundancy pay (if applicable) and leave. When in doubt, cross-check your redundancy payment and final pay figures.
• Train managers: Anyone involved in conversations should be briefed on what to say (and what not to say) to avoid creating discriminatory inferences.
• Get advice early for complex cases: Where multiple roles are affected, awards have strict rules, or there are performance or health factors in the background, it’s wise to seek tailored guidance before you start.

Key Takeaways

• You can make a role redundant before maternity leave starts in Australia - but it must be a genuine redundancy and never because of pregnancy or parental leave.
• Genuine redundancy requires a real operational change, proper award/EA consultation, and active consideration of redeployment.
• Handle timing with care: document a business case, consult genuinely, and keep clear records that separate reasons (restructure) from timing (impending leave).
• On termination, ensure correct notice (or pay in lieu), redundancy pay if applicable, leave payouts and proper treatment of superannuation.
• Reduce risk by keeping consistent communications, a thorough redeployment log, and a clear paper trail for consultation and decisions.
• The right documents - from your Employment Contract to a tailored termination documents pack - make a compliant process much easier.

If you’d like a consultation on managing redundancy near maternity leave in your business, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.