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eesa(Newbie)Newbie
12 May 2023

We have an employee who was employed on a salary in February 2023. He has been terminated with 2 weeks pay in lieu of notice. He was not dismissed because of mis-conduct etc, but simply because his position is no longer needed. He was the nominee licence holder that was needed by the company. This license is no longer needed. Is this a redundancy or a simple termination. How do I do his final pay? I use MYOB and STP2 and am not at all sure how to set this up.


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437 views
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PayrollDeanne(Taxicorn)Taxicorn
15 May 2023

Hiya @eesa


Yes, the ATO guidance defines a genuine redundancy as:


A genuine redundancy occurs when the employer has made a decision that the job no longer exists and terminates the employee's employment.


As for redundancy notice and payment, the source of this is the industrial instruments, starting with the Fair Work Act 2009 section 117(3)(a) and 119(2) that references the minimum payment of "at least one year but less than 2 years".


As you know, the reason of "genuine redundancy" has implications for how you tax and report the unused leave on termination and any other payments in consequence of employment.


Deanne

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Most helpful reply

PayrollDeanne(Taxicorn)Taxicorn
15 May 2023

Hiya @eesa


Yes, the ATO guidance defines a genuine redundancy as:


A genuine redundancy occurs when the employer has made a decision that the job no longer exists and terminates the employee's employment.


As for redundancy notice and payment, the source of this is the industrial instruments, starting with the Fair Work Act 2009 section 117(3)(a) and 119(2) that references the minimum payment of "at least one year but less than 2 years".


As you know, the reason of "genuine redundancy" has implications for how you tax and report the unused leave on termination and any other payments in consequence of employment.


Deanne

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Is the employees's termination a redundancy or just termination | ATO Community