Whether you’re an employee or an employer, unfair dismissals are sure to be a difficult and sensitive process to navigate. So, what do you need to know?

As an employee, if you’ve been dismissed from your job in a ‘harsh, unjust or unreasonable manner’, you may be able to make a claim of unfair dismissal against your employer.

If you’re successful in making this claim, you may be entitled to compensation or the reinstatement of your job — but, be wary! This is a time sensitive process. You only have 21 days to lodge this claim after your dismissal becomes effective, so it’s important you do it right. 

On the other hand, as an employer, you have several obligations and responsibilities under law — one of which is to be fair and transparent in the dismissal of your employees. So, if an employee makes a claim alleging to have been unfairly dismissed by your company, you’ll want to defend yourself and protect your reputation, even if you feel you’ve done nothing wrong.

Below, we’ll outline how to approach unfair dismissal as either an employee or an employer.

What Is An Unfair Dismissal?

To put it simply, unfair dismissal occurs when an employee’s employment is terminated unfairly. This could be at the initiative of an employer, or the employee could be forced to resign due to the actions of the employer.

Some factors that may be considered when deciding an unfair dismissal case include:

  • Whether the dismissal was harsh, unjust or unreasonable;
  • Whether the dismissal was, in fact, a case of genuine redundancy; and
  • Whether the dismissal was performed in a small business and, if so, whether it was inconsistent with the Small Business Fair Dismissal Code.

The sad reality is that many unfair dismissal cases and terminations are accompanied by instances of workplace harassment and discrimination (which you can read about here).

If an employee has been forced to resign due to the actions of their employer, the resignation is referred to as a “constructive dismissal”. Importantly, it still can be considered unfair dismissal.

Why Are Small Businesses Different When It Comes To Unfair Dismissal?

Small businesses have a different code that governs unfair dismissal — the rationale being that they are not always afforded the same resources that larger businesses benefit from. This code is known as the Small Business Fair Dismissal Code. It ensures that small businesses conduct dismissals fairly and also gives them protection in the face of unfair dismissal claims.

According to the code, the threshold for a ‘small business’ is one which has fewer than 15 employees (including employee/s being dismissed at the time, regular casual employees and overseas employees). This figure is counted at the earliest time of dismissal.

Under the Code, a small business can fairly dismiss an employee if they believe that the employee’s conduct is sufficiently serious to justify immediate dismissal.

What Do Employers Need To Know About Unfair Dismissals?

As an employer, it is likely that you’ll be notified of an unfair dismissal claim when you’re provided with a copy of the former employee’s application from the Fair Work Commission. This application means that the employee has requested that the Fair Work Commission looks into their claims and makes a determination on their case.

An application of this sort will often come as a shock to an employer and, amidst the stress of dealing with it, it can be confusing to know what to do next. However, it is important for an employer to respond to the unfair dismissal claim appropriately, regardless of whether they consider their business to be in the wrong. Failing to take part in the process can have serious consequences for a business.

Employers have the right to respond to the application using the correct forms, including outlining why they object to the application. The Commission needs this information to progress with or, if appropriate, close the application.

Following the employer’s submission of these forms, a time and date will be set for a conciliation conference by telephone. This is a voluntary process wherein Commission staff try to help both sides resolve the dispute without the need for a formal hearing before a Commission member. If the matter can’t be resolved through this informal process, it’ll progress to a formal hearing before a Member of the Commission, where a determination will be made.

Additionally, you can lodge a jurisdictional objection if you believe the dismissed employee does not fall within the Commission’s jurisdiction. For instance, you could lodge such an objection if the employee falls outside the minimum employment period (which is 12 months for small businesses and 6 months for other businesses). If the objection is upheld, the unfair dismissal claim will be dismissed.

A Staff Handbook can also prove useful in the event of an Unfair Dismissal Claim. Depending on the case, if you can prove that an employee knew the expectations and standards of their role and did not meet them, you may be able to increase your chances of successfully defending a claim.

What Do Employees Need To Know About Unfair Dismissals?

If you’re an employee, before you can apply for an unfair dismissal, you must have been employed at the business for 6 months (or 12 months if you were employed by a small business). This 6 and 12 month period calculation also includes any change of business ownership.

Most importantly, a claim must be lodged within 21 days of the dismissal becoming effective. It must also be covered by the national workplace relations system.

The national workplace relations system is a collection of legislation that applies to most employees and employers in Australia. It includes the Fair Work Act, the National Employment Standards, registered agreements and Awards.

In lodging an applicable claim, the Commision will send a copy of your application to your former employee, who will be given a chance to respond to your application.

Following this, the Commission will set up a conciliation conference on a given date and time to try to help both sides resolve the dispute. Then, if it’s not resolved here, the application will be sent to a Commission member for a decision.

In terms of remedies, the Fair Work Commission member can order reinstatement, compensation of up to 6 months wages (which cannot include compensation for shock, hurt or humiliation), and/or other non-financial remedies.

Key Takeaway

As you can see, the Unfair Dismissal claim process is a lengthy one. Whether you’re an employee or an employer, it is a matter that needs to be dealt with quickly and fairly.

If you have to navigate an unfair dismissal claim or defend yourself against one, give us a call on 1800 730 617 or email us at team@sprintlaw.com.au. We’ll happily help you out!

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