One of the world’s biggest banks has suffered a major embarrassment in its drive to automate thousands of jobs. Australia’s largest bank, Commonwealth Bank of Australia (CBA), has been ordered to rehire dozens of employees that it dismissed last year, falsely claiming that their jobs were made redundant by AI.

CBA axed the 45 positions at the start of the year, announcing that its new “voice bot” AI-powered chatbot had reduced incoming call volumes by about 2,000 per week. The bank said the reduced workload made it possible for it to operate with fewer people, and it was therefore making the roles redundant. But some of the employees were around 40 years with the bank and it later emerged that the case may have been the result of a deliberate ploy to disguise a redundancy program with a misleading claim about artificial intelligence.

Appearing before a Fair Work Tribunal, CBA conceded that one of the main reasons it gave for the dismissal had been “in error” and that it had not taken into account a surge in calls that were made around the same time as the redundancies. “Calls were increasing on a sustained basis from before the use of the voice bot, at the time it was introduced, and for many months after it was introduced,” the bank told the tribunal.

The concession that the increased volume in calls, which continued for months, should have been factored into its decision is a major blow for the bank, which had dismissed employees just three months previously on the very opposite grounds. A CBA spokesperson stated: “This error meant the roles were not redundant, despite our initial belief that they were. We have apologized to the employees concerned and acknowledge we should have been more thorough in our assessment of the roles required.”

Commenting on the decision, the Finance Sector Union (FSU) has called the ruling a “massive win” for its members. However, it has also been argued that much of the damage has already been done, with many of the bank’s former employees having already suffered from weeks of anxiety over their jobs.

With work secured, many of the workers are expected to choose between returning to their previous positions or seeking other opportunities. In a joint statement, the union said the damages could not be undone and that the case would be a warning to other workers about the speed and extent to which banks are automating. “In recent years, millions of workers have seen their jobs changed or automated by the adoption of technology. This decision shows that when employers do this arbitrarily and unfairly, they can be stopped,” it said.

The FSU filed a complaint with the commission that CBA failed to adequately consult or explain to the workers about why the jobs were being made redundant. It also alleged that the bank may have been using its move to a chatbot as a cover to offshore jobs to India, where staff were also being hired at the same time.