The Difference Between Getting Fired, Made Redundant or Being Stood Down

Employment Law has featured regularly in the news this year due to the impact of Covid-19.⠀

With unemployment rates on the rise, many terms have been used to describe current job losses such as getting fired, made redundant or being stood down. But do they all mean the same thing? In a word, no. Read on to see why;

Getting Fired

Getting fired from a job is having your employment terminated by your employer. Employment can end for many reasons including (but not limited to) poor performance, conduct and changes to operational requirements.

Commonwealth workplace laws have rules about terminating employment. These rules establish whether the termination of the employment was unlawful or unfair as well as what entitlements an employee is owed at the end of their employment.

Of course, an employee can end their employment as well.

It’s important that when employment ends, the rules for dismissal, notice and final pay are followed.

Made Redundant

Redundancy occurs when an employer doesn’t need an employee’s job to be done by anyone or the business becomes insolvent or bankrupt.

Redundancy can happen when a business;

+ Introduces new technology (eg the job can be done by a machine)

+ Slows down due to lower sales/production

+ Closes down

+ Relocates interstate or overseas

+ Restructures or reorganises because a merger or takeover happens

When an employee is made redundant they are entitled to redundancy pay (also known as severance pay). In some instances, redundancy pay doesn’t need to be paid (eg. To casual employees or for some small businesses).

Stood Down

Being stood down is a last resort for companies to stay afloat. An employee can be stood down from their role if they can’t be usefully employed because of a stoppage of work that the employer can’t reasonably be held responsible for.

Before a company considers standing down employees, particularly without pay, it’s best to ensure all other options are considered including using up accrued leave or working reduced hours. This is not a termination of your employment, it’s a temporary reprieve until the business can resume normal operations. You have a right to return to your job in the future.

Reasons for being stood down can include but are not limited to:

+ Severe & inclement weather

+ Equipment breakdown

+ Industrial action and

+ Crises such as a pandemic which we have seen this year with COVID-19

At Litton Legal, we’re experts in all things Employment Law. Got an employment issue you need help with? Contact us here to get in touch with our friendly team.