Redundancy Letter Template in Australia: How to Write It

Making a role redundant is one of the toughest calls you’ll make as a small business owner. It’s also a process with specific legal steps, documentation and timelines you need to follow.

A clear, compliant redundancy letter helps you communicate the decision respectfully, avoid misunderstandings and meet your obligations under Australian law.

In this guide, we’ll explain when to use a redundancy letter, what it must include, the legal requirements you need to consider, and provide a practical, copy‑and‑paste redundancy letter template you can adapt for your business.

What Is A Redundancy Letter And When Do You Need One?

A redundancy letter is a formal written notice to an employee that their role is being made redundant. It usually comes after consultation and exploration of alternatives, and it confirms key details like timing, entitlements and support offered.

You’ll generally issue a redundancy letter when:

• You’ve decided a role is no longer required due to operational changes (for example, restructuring, cost pressures, technology or closure of part of the business).
• You’ve consulted with the employee (and any award/enterprise agreement requirements) and considered redeployment options.
• You’re ready to provide written notice of termination on redundancy grounds and set out the employee’s entitlements and next steps.

This letter is part of a larger process. In Australia, a redundancy must be “genuine” to be lawful, which means the job is no longer required, you’ve complied with consultation obligations, and redeployment was not reasonable in the circumstances. We cover these requirements below.

What Are The Legal Requirements For Redundancy In Australia?

Before you draft or send a redundancy letter, check you’ve satisfied the key legal steps. Getting this wrong can expose your business to unfair dismissal claims or underpayment issues.

1) The Redundancy Must Be Genuine

A “genuine redundancy” happens when you no longer need a person’s job to be done by anyone due to operational changes, and you’ve complied with any consultation requirements in a modern award or enterprise agreement.

If the role still exists (and you simply plan to replace the person), it’s unlikely to be a genuine redundancy.

2) Consult Under Any Award/Enterprise Agreement

Most modern awards and enterprise agreements require consultation when major workplace changes are proposed. This typically involves notifying affected employees in writing, discussing the change and measures to avert or mitigate adverse effects, and considering their feedback.

Document these steps. Refer briefly to the consultation in your redundancy letter, and attach relevant documents if helpful.

3) Consider Redeployment

Before confirming redundancy, explore whether there are alternative roles the employee could reasonably perform, including with associated entities. If redeployment isn’t possible, note this in the letter and summarise why. If it is possible and the employee accepts, you won’t proceed with redundancy.

4) Notice Of Termination And Timing

You must provide the correct notice period (or pay in lieu). The required notice can depend on the employee’s length of service and contract terms. For a quick refresher on calculating notice, you can review notice periods to make sure your timing is correct. If you’re paying it out, you’ll need to address payment in lieu of notice explicitly in the letter (including how and when it will be paid).

5) Redundancy Pay (If Applicable)

Under the National Employment Standards, eligible employees may be entitled to redundancy pay based on their continuous service. Some small businesses (fewer than 15 employees) may be exempt, and other exceptions apply. To estimate entitlements, it can help to run the numbers with a practical tool like a redundancy calculator and then confirm the exact amount with your payroll or legal advisor.

6) Accrued Entitlements And Final Pay

Final pay should include any accrued but untaken annual leave, and long service leave if applicable under state/territory laws. If you’re paying notice in lieu, include it as well. Superannuation is generally not payable on redundancy pay, though it may be payable on some other termination payments-check your obligations carefully.

7) Other Practical Considerations

• Sick Leave And Redundancy: Questions often arise about how personal/carer’s leave interacts with redundancy. It’s worth checking your obligations around redundancy and sick leave during the process to avoid disputes.
• Record-Keeping: Retain records of consultation, notices, calculations and payments.
• Return Of Property And Confidentiality: Plan handover, return of equipment and access removal.

If any of the above feels unclear or complex, it’s a good idea to seek redundancy advice before finalising the letter. A short review can help you avoid costly missteps.

How Do You Write A Redundancy Letter (Step-By-Step)?

Your redundancy letter should be professional, empathetic and legally accurate. Aim for clear and plain English. Here’s a simple process you can follow:

Step 1: Confirm The Decision And Rationale

Briefly explain the operational reasons behind the redundancy (for example, restructure, decreased demand, or closure of a business unit). Keep the focus on the role-not the individual-and avoid language that suggests performance is the reason.

Step 2: Refer To Consultation And Redeployment

Mention that consultation has occurred (if applicable), that the feedback has been considered, and that redeployment options were assessed. Summarise the outcome in one or two lines.

Step 3: Set Out The Last Day Of Employment And Notice

State the last day of employment and how notice is being handled-worked or paid in lieu. If paying in lieu, state the amount and when it will be paid. If notice is being worked, outline expectations during the period (work handover, reasonable time off to attend interviews, if appropriate).

Step 4: Explain Entitlements And Final Pay

List each component: redundancy pay (if applicable), notice or pay in lieu, annual leave, long service leave and any other amounts. If you’re unsure of the exact figures at the time of the letter, you can indicate that a detailed breakdown will be provided separately in a final pay statement.

Step 5: Cover Practicalities (Property, Access, References)

Outline the process for returning company property and removing access. If you’re offering outplacement support or are willing to provide a reference, include that too-it can go a long way to supporting the employee through the transition.

Step 6: Provide A Contact And Next Steps

Nominate a contact person for questions. If you intend to offer a settlement arrangement or a release, you may also foreshadow a Deed of Release and Settlement to be provided separately.

Step 7: Keep The Tone Respectful

Even though this is a formal notice, acknowledge the employee’s contribution. A respectful tone reduces friction and helps maintain goodwill.

Redundancy Letter Template (Copy And Adapt)

Here’s a practical redundancy letter template you can adapt to your business. Replace the placeholders with your details and check it against the employee’s contract, any applicable award or enterprise agreement, and your legal obligations before sending.

Private & Confidential

Subject: Notice of Redundancy - 

Dear ,

We are writing to confirm that your position of  is being made redundant. This decision follows a review of our operations and . As a result, we no longer require the position to be performed by anyone.

Consultation
On , we consulted with you regarding these proposed changes in accordance with our obligations. We discussed the potential impact, considered your feedback, and explored measures to mitigate adverse effects. We have also considered reasonable redeployment opportunities within  and related entities; unfortunately, suitable alternative roles are not available.

Notice and Last Day
Your employment will end on , which reflects ’ notice in accordance with . 

Entitlements and Final Pay
On termination, you will receive:
• Redundancy pay (if applicable) of .
• Notice or pay in lieu of notice of .
• Accrued but untaken annual leave of .
• , if applicable.]
• 

These amounts will be processed in the final pay on , less applicable tax and other lawful deductions. A payslip/final payment statement will be provided outlining the calculations.

Property and Access
Please return all company property (including ) by  and ensure any company information in your possession is returned or securely deleted. Your system access will be disabled on .

Support
We appreciate your contribution to  during your time with us. If you would like a letter of service or reference, please let us know. If you have any questions about this letter or your entitlements, please contact  on .

Yours sincerely,

Tip: If you plan to offer additional compensation or mutual release terms beyond statutory entitlements, consider issuing the letter alongside a formal settlement deed and give the employee time to consider it and obtain independent advice.

Common Mistakes To Avoid With Redundancy Letters

It’s easy to focus on the letter and forget the broader process. These are common pitfalls for small businesses:

• Using redundancy to address performance issues. If performance is the real concern, follow a proper performance management process instead.
• Skipping consultation under an applicable award or agreement. You generally must consult before making a final decision.
• Not exploring redeployment. Document your search and rationale if redeployment isn’t possible.
• Miscalculating notice or entitlements. Double‑check your obligations on notice (or pay in lieu) and redundancy pay before sending the letter.
• Inconsistent messaging. Keep the rationale consistent across all documents and conversations.
• Overlooking sensitive timing and tone. A professional, empathetic letter helps reduce stress and disputes.

What Other Documents And Next Steps Should You Prepare?

Your redundancy letter is just one part of a clean, compliant exit process. Depending on your situation, you may also need:

• Employee Termination Documents Suite: A set of tailored documents to handle the end‑of‑employment process consistently and lawfully.
• Redundancy Advice: Guidance on consultation, redeployment, exemptions (e.g. small business) and entitlements before you finalise the decision.
• Deed of Release and Settlement: If you’re offering an ex‑gratia payment or want mutual release terms, a deed helps finalise matters and reduce future risk.
• Notice Period And Timing: If you need a refresher on calculating notice correctly, check your obligations around notice periods based on service and contract terms.
• Leave And Final Pay: If redundancy intersects with personal leave or other absences, confirm your position against your award/agreement and review how redundancy and sick leave interact.

Looking ahead, you may also want to review your internal documents so future changes are easier to manage. Keeping your Employment Contract and workplace policies up to date can simplify communication and reduce disputes across the employee life cycle.

FAQs For Employers Managing Redundancy Letters

Do I Have To Give A Redundancy Letter In Writing?

Yes. While discussions usually happen in person (or via a meeting), you should confirm redundancy in writing. The letter forms part of your records and evidence that you’ve met your obligations.

Can I Pay Out The Notice Period?

Often, yes. Many employers choose to provide payment in lieu of notice to end employment immediately while still meeting their legal obligations. If you do, state this clearly in the letter and include the payment in the final pay.

What If The Employee Is On Sick Leave?

Redundancy can proceed while someone is on leave, but you still need to meet all consultation, notice and payment obligations. It’s sensible to consider the nuances around redundancy and sick leave, and to communicate with care.

Should I Offer A Settlement Deed?

It depends. If you’re offering additional support or want mutual release terms, a Deed of Release and Settlement can bring finality. Make sure the employee has reasonable time to consider it and obtain independent advice.

Key Takeaways

• A redundancy letter confirms a genuine workplace change and sets out the practical details-notice, last day, and entitlements-in clear, respectful language.
• Before sending the letter, ensure you’ve complied with consultation obligations, assessed redeployment and confirmed the correct notice and redundancy pay.
• Use a structured template so you cover rationale, timing, entitlements, practicalities and a contact point, and keep the focus on the role-not performance.
• Common pitfalls include skipping consultation, miscalculating entitlements, inconsistent messaging and an overly brief or impersonal tone.
• Support your letter with the right documents and processes, such as tailored termination documents, settlement deeds and up‑to‑date employment contracts.
• If you’re unsure at any step, getting targeted redundancy advice can prevent disputes and help you do the right thing by your team and your business.

If you would like a consultation on preparing a redundancy letter and managing the process end‑to‑end, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no‑obligations chat.