Last year the average unfair dismissal claim cost Australian employers approximately $13,500 dollars, according to the Productivity Commission. However, this does not take into consideration the impact for the employer, other employees, the company and financial implications which arise from a claim.
Under the Fair Work Act 2009 (the Act), a dismissal is the termination of an employment contract by an employer. A termination will be deemed unfair if it is found to be harsh, unjust or unreasonable. This means employers cannot terminate an employee on the spot, as the dismissal would not be deemed as fair.
When interpreting whether a termination is unfair, the Fair Work Commission (FWC) will take into account whether:
there was a valid reason for dismissal
it was not consistent with requirements under the Fair Work Act 2009
it was a non-genuine redundancy
So how does an employer ensure a dismissal is fair?
The first step to preventing an unfair dismissal claim is to conduct an investigation into any incident which has led to the decision to terminate the employee, such as misconduct. The employer should interview any team members who may have witnessed the incident, or were involved in the incident, noting all responses in writing. The accused must also have ample opportunity to respond to the allegations.
The next step is to conduct a disciplinary meeting with the employee to discuss the behaviour or performance issue present.
The below process provides an outline for a disciplinary meeting:
the employee should be notified of their right to bring a support member
reiterate the behaviour or performance at question
state the result and action required
provide the employee with the opportunity to respond
record all that is discussed within the meeting
Once an employer has conducted a fair investigation and gathered evidence which strongly supports allegations regarding an employee’s misconduct, only then would it be appropriate to issue the employee with a warning. This should first be delivered by verbal means through a warning meeting and then be preceded with a written warning letter.
The written warning should:
record the parties present
outline the behaviour or performance at question
refer to a relevant policy or the employment contract
show the company expectations as outlined in the policies and procedures
show the impact their actions could have/have had on the business
show what the employer has done to assist the employee in improving
It is vital the employee understands their behaviour or performance is deemed unreasonable for the workplace and that they must adjust and improve. Many employers are not completely aware of the entire process they are required to follow, which can lead to claims being upheld by the (FWC). It is important to also note, even if serious misconduct is evident, employers must still follow a fair process before taking action.
If you would like to ensure you are following a fair process, or that you have the accurate policies and procedures in place to support workplace expectations, Employsure can assist. Call us today on 1300 651 415.