Employment law shake-up: are your policies up to standard?

Over the last couple of weeks there have been some significant cases determined in the employment law world particularly in relation to redundancies and sexual harassment. In this article, we discuss these changes and what you need to know as an employer.

Landmark High Court redundancy decision

On 6 August 2025, the High Court of Australia handed down a landmark judgment in the long-running case of Helensburgh Coal Pty Ltd v Bartley [2025] HCA29 (the case). The case relates to the legal meaning of a genuine redundancy. It has far reaching implications for employers in redundancy situations, especially for those employers who engage both employees and independent contractors as part of their day to day operations.

Background

Helensburgh Coal is the operator of Metropolitan Mine, the oldest continuously operating coal mine in Australia. In addition to its own employees, Helensburgh Coal engaged two companies to provide various services through contract workers (Contractors).

Due to reduced demand for coal during COVID, Helensburgh Coal announced that it would restructure its operations and accordingly would require fewer workers.

On 24 June 2020, Helensburgh Coal’s workforce was reduced by 90 employees, with 47 compulsory redundancies. The number of Contractors was reduced by approximately 40%.

In July 2020, 22 of Helensburgh Coal’s former employees (Respondents) applied to the Fair Work Commission (FWC) claiming they had been unfairly dismissed pursuant to the Fair Work Act 2009 (Cth) (FW Act). The FWC, agreeing with the Respondents, held that the redundancies were not genuine redundancies because it would have been reasonable in all the circumstances to redeploy the Employees into other roles, such as those held by the Contractors.

The FWC’s decision was followed by an appeal to the Full Bench of the FWC, which remitted the matter to the original FWC Commissioner to delve deeper and to consider, from the employer’s perspective, the feasibility of insourcing the Contractors’ work in addition to considering the nature of the work and whether it was specialised. Again, the FWC held that it was feasible for Helensburgh Coal to insource some of the work of the Contractors since it could ‘work around any inconveniences associated with insourcing’ (Second FWC Decision).

Helensburgh Coal made further appeals to the Full Bench of the FWC and the Full Federal Court, both of which affirmed the Second FWC Decision, resulting in an appeal to the High Court.

Legislative framework and initial finding

The FW Act provides protection against unfair dismissal where an employee dismissed for redundancy is dismissed in a situation that does not amount to a ‘genuine redundancy’.

Inaccordance with section 389 FW Act, a ‘genuine redundancy’ occurs when:

• the employer no longer requires the person’s job to be performed by anyone because of changes in the operational requirements of the business; and
• the employer has complied with any obligation in a modern award or enterprise agreement to consult about the redundancy; and
• if it would not have been reasonable ‘in all the circumstances’ for the person to be redeployed within the employer’s enterprise or an associated entity.

The Second FWC Decision accepted the first two limbs of ‘genuine redundancy’ were met but found that the dismissals were not genuine redundancies because it would have been reasonable to redeploy employees to the unspecialised roles otherwise held by Contractors.

Redeployment question

On appeal to the High Court, Helensburgh Coal contended that in determining whether it would have been reasonable in all the circumstances for the person to be redeployed within the employer’s enterprise, the FWC did not have the power to consider whether an employer (by insourcing roles held by Contractors) could have made a position available for an employee. Ultimately, the High Court rejected this argument.

The High Court found that an inquiry into section 389 includes consideration of the following factors:

(a)               the scope of inquiry is limited to the employer’s “enterprise”, being the business, activity, project or undertaking. The FWC cannot disregard the nature of the enterprise in considering reasonableness of redeployment, however it can consider operational factors such as how or why the employer organises and uses its workforce;

(b)               reasonable redeployment does not require the existence of a vacant position, rather section 389(2) FW Act looks to whether there was work, or demand for work, within an employer’s enterprise that could have been performed by the otherwise redundant Employee;

(c)                whether the redeployment “would have been reasonable” directs consideration to the past tense, requiring a hypothetical inquiry at the time of the dismissal and whether it would have been reasonable to redeploy at that time;

(d)               reasonableness is to be determined objectively in the context of the employer’s enterprise having regard to the nature of that enterprise; and

(e)                the words “in all the circumstances” are intentionally broad and point against the existence of binding rules concerning the application of the section.

Majority findings

The majority found that the words “in all the circumstances” include consideration of how an employer uses its workforce to operate its enterprise and why it does so in that manner. These circumstances may have a bearing on whether it would have been reasonable to redeploy an employee in the enterprise.

In rejection of Helensburgh Coal’s submission, the majority found that the language of the section does not prohibit asking whether an employer could have made changes to how it uses its workforce so as to create or make available a position for an employee who would otherwise have been redundant.

Additionally, the Court held that while the FWC can consider how the employer uses its workforce as an aspect of “in all the circumstances”, this does not extend to having the power to consider the process for selecting individuals for redundancy.

Conclusion

Importantly, the case highlights the broad powers given to the FWC to scrutinise workplace redundancy decisions.

This includes probing into whether an employer could have made changes to its operations so as to create or make available a position for an otherwise redundant employee (including by terminating the engagement of its independent contractors).

What does this mean for employers?

In redundancy situations, employers should:

• give thorough consideration to any contract workers engaged by them and their associated entities;
• consider whether any contracted workers are undertaking unspecialised work, or work that current employees who are at risk of redundancy would otherwise be capable of undertaking;
• favour retaining employees over contract workers where there is a possibility that the role of a contractor could be filled by an employee; and
• seek legal advice on any planned redundancies at an early stage to minimise legal risk.

Australia's largest sexual harassment compensation

In the recent Federal Court decision of Magar v Khan [2025] FAC 874, the supervisor of a fast-food restaurant was awarded the sum of $305,000 in general, aggravated and compensatory damages resulting from a number of sexual harassment claims brought against the manager and principal of the fast-food restaurant where she worked.

This decision is the first time that a court has examined the breadth of the sex-based harassment provisions of the Sex Discrimination Act 1984 (Cth)(Act). This case also marks the highest amount of compensation awarded by a court in a sexual harassment claim with $305,000 awarded in damages.

Background

The Applicant, a supervisor at a Mad Mex franchise, brought a claim against the owner of the franchise for sexually harassing her, harassing her on the grounds of sex, and for victimising her for making a formal complaint about the conduct.

The claim was based on sexually inappropriate comments and questions directed toward the Applicant, and about women in general, made by the Respondent and other male employees. Examples of conduct engaged in by the Respondent included commenting on the Applicant’s “hickey” and pointing it out to other male employees, commenting on and asking her about her recent sexual activity, showing her videos and screenshots of pornographic material, asking her what her private body parts looked like, asking her about her sexual orientation, showing her sex toys and touching one of them onto her thigh and suggesting they attend a massage parlour together to watch pornographic material.

Further examples of the conduct that occurred more generally within the workplace included male employees making sexually suggestive comments about female customers and former employees, including by labelling them as “skanks” or “whores”.

All of this conduct occurred in circumstances where the Respondent was in a position of power (being the owner of the business and significantly older than the Applicant), and where he knew that the Applicant was a Nepalese migrant with no family in Australia and suffered from mental health issues.

As a result of the conduct, the Applicant developed a major depressive disorder and post-traumatic stress disorder. She became bedridden “most days”, was unable to prepare and eat food, or use the bathroom without great difficulty.  

The Applicant made an initial formal complaint to Mad Mex’s human resources department. The Respondent’s legal representatives retaliated by threatening the Applicant with defamation proceedings.

Decision

In deciding this matter, Justice Bromwich made a number of comments about the nature of the workplace, including that the Respondent “fostered a workplace culture that was disinterested in preventing sexist conduct from taking place and was instead tolerant, or even conducive to its continuation”, and specifically in respect of the conduct by the Respondent that “any reasonable person” would have anticipated the “virtual certainty” that  the conduct would have offended, humiliated or intimidated the Applicant, a risk that was significantly heightened due to the Applicant’s personal characteristics and circumstances.

It was determined that the conduct amounted to workplace sexual harassment under section 28B(2) and (3) of the Act.

In respect of section 28AA, being harassment on the ground of sex, it was determined by Justice Bromwich that in respect of the sexually suggestive comments made generally in the workplace by the Respondent and other employees towards female customers and former employees, that the nexus between this conduct and the Applicant was too insignificant for this element of the claim to succeed. Justice Bromwich provided an example of conduct that would amount to discrimination on the ground of sex, being “if the demeaning comments and purported humour as to sexual activity by one or more of the men had been proven to be about, or otherwise directed at, [the supervisor], inevitably because she is a woman and thus upon the ground of her sex, given the nature and content of what was said.”

The court also found that the defamation claim threats amounted to victimisation of the Applicant contrary to section 47A of the Act.

Key takeaways

The court will consider many factors in determining whether sexual harassment has occurred in the workplace. The following factors were particularly important in this case:

(1)          whether a workplace is dominated by one sex;

(2)          the existence of power imbalances including age;

(3)          an employee’s particular vulnerability and the employer’s knowledge of it;

(4)          workplace culture overall;

(5)          the existence and effectiveness of workplace policies and training to prevent sexual harassment; and

(6)          the support provided by an employer after an employee has made an internal complaint.

The Applicant in this case also brought claims against the incorporated franchisee. She dropped the claims against the franchisee when it went into liquidation. In a typical employment situation, it is probable that the employer (as well as the named individual) would have been held liable for the conduct and that significant financial penalties would have been imposed, in addition to compensation.

If you require assistance with ensuring your employment practices, policies and procedures are best practice, you can reach out to our employment team here‍.