An employer took unlawful adverse action when it dismissed a pregnant employee (Ms P) on grounds of redundancy two days before she was due to commence parental leave. Interestingly, the dismissal itself was justified, but the timing of the dismissal made it unlawful.

The Federal Circuit Court found that while there was a genuine business case for the redundancy, the company’s decision to bring Ms P’s redundancy forward to just two days prior to her parental leave beginning amounted to unlawful adverse action taken because Ms P was pregnant and due to exercise her workplace right to take parental leave.

Ms P’s redundancy was one of eight redundancies arising from a business restructure. The other seven employees were to be made redundant on 12 November 2015. Because Ms P was due to commence parental leave on 6 November 2015, her termination date was brought forward to 4 November 2015 rather than have her come in during parental leave to be told.

The employer failed to convince the Court that it brought the date forward with Ms P’s best interests in mind.

In fact, as a result of the decision to bring forward the termination date, Ms P lost her right to parental leave (including a portion of company paid parental leave) and the return to work guarantee.

In a warning for all employers contemplating making an employee redundant while on parental leave, the Court said it would also have been unlawful for the employer to terminate Ms P on 12 November 2015 after she had commenced parental leave as the company would have been in breach of the return to work guarantee in the Fair Work Act 2009.

Lesson for employers

Whilst it is not unlawful to make a pregnant employee redundant, an employer should seek advice to minimise the risks and ensure an employee is not disadvantaged as a result of being pregnant or exercising a workplace right to take parental leave. Although management may consider that a certain approach would be in the best interests of an employee, this does not negate the requirement to ensure due process is followed. The timing of any decision will be crucial.

Power v BOC Ltd & Ors [2017] FCCA 1868 (9 August 2017)