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AI‑Driven automation pressures rise as Amazon cuts 16,000 jobs globally. Amazon confirmed this week that it will cut 16,000 jobs as part of a major restructuring designed to 'strengthen' the business by reducing layers, boosting ownership and eliminating bureaucracy.
This week, senior leadership at Amazon confirmed job cuts impacting 16,000 roles, with plans to "strengthen" the organisation by "reducing layers, increasing ownership, and removing bureaucracy".
None of these layoffs impacts Australian roles directly; however, Christa Lenard, partner at Kingston Reid, said that similar pressures are emerging in Australia due to the impacts of AI-driven automation on redefining job structures and replacing some functions.
Following a misfired internal email on Tuesday (27 January) prematurely informing staff about imminent layoffs, Amazon's senior vice president of people experience and technology, Beth Galetti, confirmed this week that 16,000 reductions would occur across the organisation.
According to Reuters, internal correspondence sent by Amazon described the retrenchments as "Project Dawn".
"The accidental early email sent to Amazon's workforce is a stark reminder of how damaging poorly timed or unclear communication can be during restructures," said Lenard.
Genuine redundancies
Galetti said in a Wednesday statement (28 January) that Amazon is "offering most US-based employees 90 days to look for a new role internally (timing will vary internationally based on local and country-level requirements)".
"Then, for teammates who are unable to find a new role at Amazon or who choose not to look for one, we'll provide transition support, including severance pay, outplacement services, health insurance benefits (as applicable), and more," Galetti added.
Aaron Goonrey, partner and head of employment and reward APAC at Pinsent Masons, said: "AI-driven restructures do not ease obligations around genuine redundancy, consultation or procedural fairness under the Fair Work Act."
Andrew Jewell, principal at Jewell Hancock, said: "Employers generally need to consult with employees regarding workplace change, which would include restructures and redundancies, and need to genuinely consider redeployment opportunities across their broader business. If a proper process is not followed, an employee may be entitled to bring an unfair dismissal claim."
According to Michael Byrnes, partner at Swaab, redundancies must be carefully mapped out and executed sensitively.
"For a redundancy to be a 'genuine redundancy' for the purpose of the unfair dismissal provisions of the Fair Work Act, there needs to be proper consideration given to the option of reasonable redeployment of employees affected by redundancy to endeavour to avoid termination of employment," Byrnes added.
Redundancies due to AI: Increasingly common
For Elizabeth Aitken, partner and national head of workplace relations and safety at SLF lawyers, businesses must ensure that AI-driven decisions comply with their obligations around consultation, redundancy and lawful dismissal under the Fair Work Act.
"Organisations will also need far tighter governance around decision making, communications and human oversight to avoid legal risk and erosion of employee trust," Aitken said.
"Redundancies due to AI are, it seems, going to become increasingly common. While many might disagree with a decision to replace employees with AI, subject to the redundancies being implemented in accordance with Australian law (including any necessary notification and consultation obligations), it is going to be generally within the prerogative of an employer to use technology as part of a strategy to reduce its workforce," Byrnes said.
Lenard stressed that thoughtful, transparent engagement be made by HR departments to minimise the risk of psychological hardship and to support workforce stability as well as the risk of legal and industrial challenges.
"When organisational redesign is driven by technological change, HR leaders must ensure consultation processes are carefully sequenced, messages are consistent, and employees hear difficult news through the correct channels and not through internal leaks or gossip," Lenard said.
For further information please contact:
Michael Byrnes, Partner
Phone: + 61 2 9233 5544
Email: mjb@swaab.com.au
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