Termination, retirement and redundancy

This information is about the obligations placed on employers in relation ending an employee’s term, under the Anti-Discrimination Act 1991 .


Employers and organisations cannot terminate a person's employment because of discriminatory reasons.

This means that a worker cannot be sacked because they are 'too old', the wrong sex, have or once had an impairment, become or plan to become pregnant, marry or separate from a partner, join a trade union or political party, are a member of a religious order, are gay, lesbian, heterosexual, transgender or bisexual, a particular race, or because they have a family. Termination of employment must only occur on valid non-discriminatory grounds.

If an employee believes that they have been dismissed for discriminatory reasons they can complain to the Commission or can seek reinstatement through the Industrial Relations Commission. If dismissed workers apply to the Industrial Commission first, they may later come to the Commission. However, if a dismissed worker first lodges a complaint with the Commission, they cannot later apply to the Industrial Commission.

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Compulsory retirement (except in very limited circumstances) has been abolished by the legislation. Employers must not sack workers because they are 'too old'. Nor can workers be asked to sign agreements that they will retire upon reaching a certain age. People cannot be asked to sign unlawful agreements.

An employer should not engage in conduct designed to make someone retire because of his or her age, eg the imposition of fixed term contracts, medical assessments or withdrawal of employee benefits such as long service leave for older workers. Such conduct will be unlawful.

For example, when Justin turned 60 years old his office workplace held a celebration party. The next day Justin's supervisor told him it was company policy that because of his age Justin had to undergo a medical test to determine his continuing work performance capabilities. Although Justin did not think such a test was necessary, he agreed to cooperate because he didn't think the test would show any problems. Shortly after the medical examination Justin was told that he was being put on six monthly reviewable contracts because the test had shown that his physical reaction times had deteriorated slightly. However, Justin's job did not involve physical work and he suspected that his employer wanted him to retire. At conciliation Justin received an apology, compensation and a return to permanent status in his job. The company also agreed to withdraw its policy on age based medical tests and to implement an appropriate workplace anti-discrimination training program.

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Redundancies must also be handled in a non-discriminatory way. Employers need to be careful to ensure that decisions about workers being offered a redundancy, are not based on direct or indirect discrimination.

Often the result of restructuring or financial reorganisation, redundancies provide opportunities for unfair discrimination if not carefully monitored for assumptions and biases. In particular, offering redundancies to workers because of their age, sex, cultural or racial background, or pregnancy etc will be unlawful discrimination and could be complained about. Conciliation outcomes and case law demonstrate that if discriminatory attitudes inform redundancy decisions employers can be held legally liable.

For example, Amy was the Assistant State Manager for a transport company. After Amy became pregnant she informed her employer and submitted an application for maternity leave for the birth of her child. However, shortly after this the company merged with another business and was restructured. Amy was then offered a redundancy. In contrast, the recently appointed male Office Manager who had far less experience than Amy was offered the State Manager position. Amy complained of discrimination on the basis of pregnancy and sex and received compensation as a result of conciliation.

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