What outplacement is, and whether you have to offer it

Outplacement is help with finding the next job, paid for by the employer, for people whose roles are ending. Australian employers are not required by the Fair Work Act to provide it, but an enterprise agreement, a contract or a company policy can promise it, and many employers offer it anyway because it changes how a redundancy lands.

This guide explains what outplacement usually includes, what it is not, where an obligation can come from, what free government help already exists, and how to decide whether it is worth paying for. It is written for the HR manager or business owner planning a redundancy.

What outplacement includes

Outplacement programmes vary a lot, but most draw on the same parts:

Working out what comes next: which roles the person could move into, given what they have done.
A resume and applications: rewriting the resume, often for particular kinds of role, plus cover letters and help with applications.
Interview practice, with feedback.
Coaching, one to one or in groups, in person or online.
Job search help: LinkedIn, where to look, and how to approach employers.
Sometimes, help with money and wellbeing, such as a session on financial decisions or access to counselling.

The difference between programmes is mostly how much of each, for how long, and how much time with a person is included. Our guide to what outplacement costs explains how that drives the price.

What outplacement is not

It is not a job guarantee. No honest provider promises anyone a job. Be wary of one that does.
It is not recruitment. An outplacement provider helps the person compete for jobs; it does not place them into one.
It does not replace entitlements. Notice, redundancy pay and final pay are owed whether or not you offer outplacement. Our redundancy process checklist covers those.
It is not a way to soften a redundancy that is not genuine. If the role is still needed, outplacement does not fix that.

Do you have to offer it?

The Fair Work Act does not require an employer to provide outplacement. Your legal duties in a redundancy are consultation where an award or agreement requires it, notice or pay in lieu, redundancy pay where it applies, the final pay, and written notice to Services Australia if you are considering 15 or more redundancies (Fair Work Ombudsman).

An obligation can still come from somewhere else. Check three places:

Your enterprise agreement. Some agreements include redundancy support, such as career transition help or paid time to attend it.
Contracts and letters of offer, especially for senior staff.
Company policy. A redundancy or restructure policy that promises support may be enforceable, depending on how it is worded and whether it forms part of employment contracts.

The Fair Work Ombudsman also notes that employers can provide additional support and resources to employees being made redundant, as part of consultation. Offering support is one of the ways to reduce the effects of a change, which is what consultation asks you to discuss.

The free help that already exists

Before you pay for anything, know what your people can already get for free, so you can point them to it and so any paid support adds to it rather than repeats it:

What's Next. The Australian Government's What's Next website, run by the Department of Employment and Workplace Relations, has information and resources for people facing retrenchment.
Services Australia. If you are considering 15 or more redundancies you must notify Services Australia in writing. At your request it can run information sessions for affected staff through its Financial Information Service, and it can refer them to employment services.
Your employee assistance programme, if you have one, for counselling.

Free government services are a real help, but they are general. They are not built around one person's work history, and they will not write someone's applications for them.

When outplacement is worth paying for

Outplacement does not change what you legally owe. Whether it is worth the money depends on what you want the redundancy to look like, for three groups of people:

The people leaving. Good support gets people to their next role sooner and with less damage. That is the main reason to do it.
The people staying. Staff watch how their colleagues are treated, and they remember it. A redundancy handled with care costs you less in the morale and trust of the people you need.
The business. People who leave feeling fairly treated are less likely to dispute the decision, and more likely to speak well of you.

It is most worth it where the people affected will find the change hardest: long service in one role, roles that technology is replacing, or a local market with few similar jobs.

Choosing a provider

Ask every provider the same questions: what each person gets, in hours and weeks; who does the coaching; when support starts; what the person keeps; and what is reported to you. Insist on privacy. People use support more when they know their employer cannot see their applications. Our guide to career transition coaching or outplacement helps you work out which kind of support fits your people.

Changing Careers gives each person you nominate twelve weeks of help with their next role, with a real Australian career coach, for A$599 per person.

Common questions

What does outplacement mean?

Outplacement means help with finding the next job, paid for by an employer, for people whose roles are ending. It usually combines resume and application help, interview practice and coaching.

Is outplacement required by law in Australia?

The Fair Work Act does not require outplacement, but an enterprise agreement, an employment contract or a company redundancy policy can promise it, so check all three before treating it as optional.

Does outplacement guarantee a new job?

Outplacement does not guarantee a new job. It helps a person compete for roles with a stronger resume, better applications and practice at interviews, and any provider promising a job should be treated with caution.

What free help can redundant employees get?

Redundant employees can use the government's What's Next website, and Services Australia can refer them to employment services and, at an employer's request, run Financial Information Service sessions for affected staff.