The High Court’s decision in Helensburgh Coal[1] has significant implications for employers who rely on contractors or labour hire alongside permanent staff, or who seek to outsource work.
Helensburgh Coal made 90 permanent employees redundant in mid-2020 but continued to engage contractors to perform work that could have been performed by those employees. The High Court held that the FWC may consider, when determining whether a redundancy is genuine, whether an employer could have restructured its workforce, such as by replacing contractors with permanent employees, to avoid redundancies. Redeployment does not require a vacant position, and if suitable work exists within the enterprise, even if performed by contractors, it may be reasonable to redeploy a redundant employee into that role. The FWC must consider “all the circumstances,” including the nature of the employer’s business, the employee’s skills, and the feasibility of reallocating work.
Key Implications for Employers
- Employers must assess all internal redeployment options, including roles currently performed by contractors, before proceeding with redundancies
- Contractor arrangements should be reviewed to ensure flexibility in workforce planning.
[1] Helensburgh Coal Pty Ltd v Bartley [2025] HCA 29
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