Australian regulation of economic dismissals: Before, during and after 'Work Choices'

This article examines the regulation of economic dismissals under Australian federal law over the last fifteen years. Economic dismissals of employees, or 'retrenchments', are usually based on operational, technological, or similar grounds arising from 'restructuring' decisions made by employers. The article focuses in particular on the 2005 'Work Choices' legislation, the Workplace Relations Amendment (Work Choices) Act 2005 (Cth) ('Work Choices Act'), and the exclusion (introduced by that legislation) of unfair dismissal claims in respect of dismissals based on 'genuine operational reasons'. The article begins by examining the regulation of economic dismissals prior to Work Choices, commencing with the Keating Labor Government's unfair dismissal laws in 1993 and the Howard Coalition Government's 1996 amendments. Attention then turns to the policy rationale and statutory formulation of the genuine operational reasons exclusion, in the context of the broader changes to the unfair dismissal framework implemented under Work Choices. This is followed by detailed discussion and analysis of the case law on the operational reasons exclusion emanating from the Australian Industrial Relations Commission since March 2006. One of the main conclusions drawn from this analysis is that the operational reasons exclusion has significantly reduced the employment security of Australian workers. The article concludes with a brief consideration of the Rudd Labor Government's proposed reforms of federal unfair dismissal laws, and suggests that this process should be informed by the research findings presented herein.