Background
Serco Australia Pty Ltd provided immigration detention services under successive Commonwealth contracts. After the Department of Home Affairs selected Secure Journeys Pty Ltd to replace Serco, with some services to be subcontracted to Spotless Services Australia Limited, Serco ceased operating the Perth and Yongah Hill immigration detention centres at 8:00 pm on 13 March 2025.
The dispute concerned 146 Serco employees covered by the Serco Immigration Services Enterprise Agreement 2023. It was alleged that they ultimately commenced employment with Secure Journeys or Spotless, but the evidence concerning some employees’ acceptance and commencement dates was missing, inconsistent or unreliable. Serco sought declarations that it had not terminated their employment and owed no redundancy pay under the agreement. The union accepted that Serco had provided the required termination notice, leaving no live dispute about payment in lieu of notice.
The Court’s Holding
Justice Vandongen held that redundancy occurred under clause 25.1 when Serco ceased providing the contracted services on 13 March 2025. At that point, Serco necessarily decided that it no longer required anyone to perform the jobs the employees had been doing for Serco under its detention-services contract, even though the loss of the contract left Serco with no practical choice.
The Court rejected Serco’s argument that the employees had ended their own employment by accepting or commencing work with the incoming providers. Accepting future employment did not, without more, establish repudiation of their Serco contracts, and the evidence did not prove that any employee began incompatible work before the transition or failed to complete their obligations to Serco. The employees’ employment was therefore terminated by reason of redundancy within clause 25.5(b), and the Court dismissed Serco’s amended application for declaratory relief.
Key Takeaways
- Under this enterprise agreement, redundancy occurred when Serco ceased the contracted operation and no longer required the affected jobs to be performed for it.
- An employee’s acceptance of future work with an incoming service provider did not by itself amount to resignation or repudiation of the existing employment relationship.
- Inconsistent contractual commencement dates were insufficient to prove that employees began incompatible employment before their Serco jobs ended.
Why It Matters
The decision shows that redundancy rights following a change of contractor turn on the language of the governing industrial instrument and the evidence about how each employment relationship ended. An outgoing contractor cannot avoid redundancy obligations merely by asserting that employees accepted work with the replacement provider.
Employers relying on resignation, repudiation or a change-of-provider exception need reliable evidence that the relevant contractual conditions were satisfied. Administrative commencement dates or assumptions about employees’ future plans may not establish that employees themselves terminated the employment relationship before redundancy occurred.