Considerations when implementing organisational change
Restructuring, redeployment and redundancy are distinct yet interconnected processes that organisations may undertake to improve operations and adapt to changing circumstances. It’s important for employers to understand their options and obligations when looking to implement organisational change in a tight labour market.
Restructuring involves changing the operational setup of a business to enhance efficiency, delivery of products or services, or respond to market demands. It focuses on configuring roles and positions within the organisation. This process may include adding new roles, merging existing ones, or eliminating positions that are no longer necessary.A genuine business reason, such as financial constraints, market shifts, or brand realignment, must be clearly stated during the restructuring process. This reason serves as the foundation for making changes to the organisational structure and justifies the need for role adjustments. Redeployment and redundancy are possible outcomes of a restructuring process. Redeployment involves shifting an employee’s role within the organisation. Redundancy involves terminating employment because the role or position becomes surplus to the business' commercial needs. Redundancy should be considered a last resort after exploring all reasonable alternatives, such as redeployment or retraining employees for other suitable roles within the organisation.
Key considerations:
Change Management Strategy: Restructuring, redeployment and redundancy are all forms of organisational change that need to be thoughtfully managed. It is best practice for employers to follow a change management strategy. This helps employers navigate and implement workplace change smoothly and effectively while minimising the impact on employees.
Consultation and Alternatives: Employers have an obligation to consult with affected employees before making decisions related to restructuring, redeployment or redundancy. This includes providing detailed proposals, allowing reasonable time for consideration, and offering opportunities for employees to provide feedback.
Fair Process and Documentation: During restructuring, redeployment and redundancy, employers must follow proper processes and comply with legislation such the Fair Work Act, which defines "genuine redundancy" and outlines consultation requirements. Employers must ensure that restructuring is not used to manage performance or behavioural issues. It is important to document all reasoning, decisions, and relevant information related to the restructuring process, share this information with employees and offer compensation as per applicable awards, agreements, or contracts.
Notice Period and Entitlements: Employers must provide appropriate notice periods as outlined in the National Employment Standards, awards, agreements and/or workplace policies. Employees are entitled to salary, unused annual and long service leave, and other entitlements up to their last day of employment. Redundancy compensation, as specified in employment contracts or negotiations, should also be paid.
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