Procedural Fairness in Termination of Employment

In a previous newsletter we pointed out what to do if an employee resigns on the spot during a period of hot temper. Occasionally an employer may also act in a state of hot-temper, and it is important to make sure that any decision to terminate an employee’s employment is not done in haste.

When the Fair Work Commission is asked to decide whether the termination of employment is unfair the various criteria they look at are:

1.       Is there a valid reason for the termination of employment,

2.       Was the employee made aware of the reasons for the termination,

3.       Did the employee have the opportunity to respond to the allegations of misconduct or poor performance, and

4.       In the case of performance related matters, was the employee aware that their employment was at risk if their performance did not improve.

Many unfair dismissal claims are successful for the employee not because there was not a valid reason for termination but rather the employer did not provide procedural fairness. That is, they did not follow the requirements set out under the legislation.

It should be noted that an employee has 21 days after the date of termination to lodge a claim in the Fair Work Commission.

In a recent case in which we were involved there were substantial conduct and performance matters that certainly justified the termination of the employee’s employment. Becoming completely frustrated the employer notified the employee at the end of the day’s work that his employment was terminated immediately, though the appropriate notice period was paid out.

The problem for the employer when the matter got to the Fair Work Commission was that he did not specify to the employee the reasons for the termination other than “things aren’t working out”, and did not give the employee the opportunity to respond to the issues the employer may have had.

The employee had never formally been advised that his performance was not up to expectations.

In effect, the employer did not meet three of the four criteria set out above and had to make an additional payment to the employee for the unfair dismissal.

We once had a telephone call where the employer stated, “I know I’ve done the wrong thing, but I sacked him yesterday.” The question arose, why did the employer not call the day before, prior to actual termination.

If as an employer you feel that you need to terminate an employee's employment always make sure you get proper advice as to the steps to take. Primary Employers Tasmania can give the advice you need and can even attend at the workplace to ensure that the correct steps are followed.