Unfair Dismissal

When an employee submits a case for wrongful dismissal and the Fair Work Commission determines that:

  • The dismissal of the employee was harsh, unjust, or arbitrary;
  • it was not due to a true case of redundancy;
  • the individual worked for a small business; and
  • it did not follow the Small Business Fair Dismissal Code.

Casual workers have the same rights to unjust dismissal, but they must demonstrate that they have been hired regularly and systematically with a reasonable prospect of continued employment.

 

Eligibility

The employee will be qualified to file a claim for unfair dismissal if they are covered by an award or agreement and have completed the required number of years of service.

Employees are also qualified to file a claim for unfair dismissal if they do not have coverage under an award or agreement but make less than the high-income threshold, which is changed annually.

 

 

Minimum Employment Period

Before filing a claim for wrongful dismissal, employees must have been with the company for at least six months.

Before applying, workers for a small business must have been there for at least a year.

When determining the minimum employment duration in the event of a change in business ownership, service with the first employer may be treated as service with the second employer.

 

 

Application

The Fair Work Commission will judge whether an employer has terminated an employee in a way that is both substantively and procedurally fair.

  • It signifies that the employer had a good basis for firing the employee and that the right course of action was followed in the given situation.
  • A dismissal that was procedurally fair occurred because good hiring procedures were followed by the employer.

The Fair Work Commission will take into account whether the dismissal was severe, unfair, or unreasonable when determining whether an employer was substantively and procedurally fair in terminating an employee.

 

 

Harsh, Unjust or Unreasonable

The following considerations are taken into account to decide if a dismissal is harsh, unjust, or unreasonable:

  • Whether there was a valid reason for the dismissal related to the employee’s capacity or conduct;
  • Whether the employee was notified of the reason;
  • Whether the employee was given an opportunity to respond;
  • Any unreasonable refusal by the employer to allow the employee to have a support person present;
  • Whether the employee had been warned about any unsatisfactory performance before the termination (if relevant);
  • The degree to the size of the business and internal expertise would impact on the procedures followed; and
  • Any other relevant matters.

 

 

Remedies

Most claims of unjust dismissal are resolved through conciliation. The conciliation procedure is confidential, and it frequently leads to a shared understanding over the employee’s compensation.

The following are possible remedies for unjust dismissal if the case continues to arbitration, which is a formal hearing decided by the Fair Work Commission:

  • Reinstatement (getting the job back);
  • Compensation (must not be more than 26 weeks’ pay); and
  • Non-financial remedies such as a written statement of service.

How HR Connect can help

If you require assistance with dealing with disciplinary issues concerning staff, HR Connect can help. Our HR Advisors will be able to guide you through each step of the disciplinary process and we have template documents (e.g. direction to attend a disciplinary meeting, written warning, letter of termination, etc) available as part of our subscription packages.

 

 

About HR Connect

HR Connect is one of Australia’s leading providers of HR & workplace safety advice services, designed to help small business owners make confident and compliant business decisions.

 

Disclaimer

The information provided in these knowledge base articles is general in nature and is not intended to substitute for professional advice. If you are unsure about how this information applies to your specific situation we recommend you contact HR Connect for advice. The information in this summary is correct as of August 2021.

 

This knowledge base article will change over time, as Modern Award legislation relating to this Industry or Occupation is passed by the Fair Work Commission. Originally published on 21 September 2021 and last updated on 18 February 2022.

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