Many employers feel the threat of an Unfair Dismissal claim is hanging over their head when considering terminating the employment of a staff member.
To effectively manage the risk employers need to know:
- Who is eligible to lodge a claim;
- How “unfair” defined;
- What is the process used; and
- What are the consequences of an Unfair Dismissal ruling.
1. The checklist below will quickly determine who is eligible:
2. What is deemed “Unfair”
A dismissal is considered to be unfair if it is found to be harsh, unjust or unreasonable, with consideration given to the following factors:
- Was there a valid reason for termination?
- Was the employee notified of the reason at the time of, or prior to, the dismissal?
- Was the employee given an opportunity to respond?
- Was the presence of a support person unreasonably refused?
- In the case of performance management, what procedures were followed?
- What is the size of the employer’s business, is there a dedicated HR person?
3. The Unfair Dismissal Process
Step 1 Conciliation – generally by phone call and chaired by FWC conciliator
Step 2 If Conciliation is unsuccessful the Applicant (ex-employee) can seek Arbitration
Step 3 If Arbitration does not resolve the matter a full hearing can be held if the FWC deems it appropriate
4. Consequences of an Unfair Dismissal Finding
The FWC can order the following remedies if a dismissal is deemed to be unfair:
1. Reinstatement on the same terms and conditions as at the time of dismissal. The FWC may also order payment of any remuneration lost between dismissal and the order to reinstate and/ or preservation of length of service; or
2. If reinstatement is considered to be inappropriate the FWC will order compensation, capped at the equivalent of six (6) months of the employees annual remuneration.
Cost orders may also be made in cases where it is found that one party has acted unreasonably in the conduct of the application.
Effectively assessing and managing the risk to your business of an unfair dismissal claim is key in any employee dismissal. Robust decision making mechanisms and fair and equitable procedures will help you to minimise the risk of an unfair dismissal claim and manage the impact to your business in the event that a claim is actually lodged.
Contact WCA- People & Culture Solutions if you require any assistance with Industrial Relations and Human Resources on (08) 9383 3293 or admin@wcasolutions.com.
