In accordance with the contract of employment and the Fair Work Act 2009 (Cth) (‘Act’), employers have a legal right to terminate the employment of their employees. Where an employee believes they have been unfairly dismissed or terminated due to discrimination, or the employee exercising a workplace right, the employee may apply for an unfair dismissal or general protections claim.
Employee rights in an Unfair Dismissal
The Fair Work Commission (FWC) allows an employee to apply for a remedy if it can be found that the termination was harsh, unjust or unreasonable.
An application for unfair dismissal must be made to the FWC within 21 days of the date of the termination. Employers will have a period of 7 days to provide a response to the application.
An attempt will first be made to settle an unlawful dismissal by conciliation, which is an alternative dispute resolution process. However, where conciliation is unsuccessful in resolving the dispute, the matter will proceed to arbitration/hearing and a determination as to the lawfulness of the termination will be made by a member of the FWC.
The Act identifies the following types of employees who are not permitted to make an unfair dismissal application.
- Employees serving a qualifying period of employment (12 months for small businesses, and 6 months for all other businesses).
- Employees who are engaged for a specified period, task or season and who are terminated at the end of the period, task or season.
- Employees that are genuinely made redundant.
- Employees who are not covered by a Modern Award or Enterprise Agreement and who are earning more than $153,600 (as of 1 July 2020) in the 12 months leading up to the dismissal.
Reasons for termination
An employee’s employment may only be validly terminated in connection with:
- the employee’s capacity or conduct; or
- the operational requirements of the business.
Further, the reason for the dismissal must not be capricious, fanciful, spiteful or prejudiced as determined in Selvachandren v Peteron Plastics Pty Ltd (1195).
Where an employee forms the view that their dismissal was harsh, unjust or unreasonable, the employee may make an unfair dismissal application. The reason for the employee forming the view that the dismissal was harsh, unjust or unreasonable may be due to the following circumstances (amongst others):
- where a valid reason exists, but it does not sufficiently justify the dismissal;
- where a valid reason exists but there has been a lack of procedural fairness (e.g. where an employer has failed to warn an employee of the unsatisfactory performance prior to termination); or
- where a valid reason exists, but the employee is not warned that failure to correct the problem will result in termination.
Employees found to have been unlawfully and unfairly terminated may seek the following remedies:
- reinstatement to the former or a similar position; or
- where reinstatement is not possible, an order for the payment of compensation may be made.
Note that the maximum compensation that can be awarded in an unfair dismissal application is 26 weeks of remuneration or approximately $76,800 (as at 1 July 2020), whichever is less.
Under the Act, a person must not take an adverse action (i.e. termination) against another person, because that other person has a workplace right, exercises a workplace right or proposes to exercise a workplace right. An adverse action includes the dismissing or refusing to employ someone, discriminating against a person, or otherwise injuring them in their employment.
The general protections laws apply to:
- employees and prospective employees;
- employers and prospective employers;
- independent contractors and prospective independent contractors;
- a person who has entered into or who has proposed to enter into a contract for services with an independent contractor; and
- an industrial association, including an officer or member of an industrial association.
A general protections dispute occurs when an adverse action is taken, or threatened to be taken, because a person has a workplace right, exercises that right or proposes to exercise that right.
General protections afforded to persons under the Act also include protection from:
- engaging in, or proposing to engage in, industrial activity, including any refusal to participate in industrial action; and
- discrimination based on race, colour, sex, sexual preference, age, physical or mental disability, marital status, family or carer’s responsibilities, pregnancy, religion, political opinion, national extraction or social origin.
The above reasons need not be the sole or dominant reason for the dismissal in order to entitle the employee to bring a general protections claim.
Responding to an application
Where an entity is served with a general protections claim and wishes to dispute it, the entity can lodge a written response within 7 days of receiving the claim setting out its position with respect to the claim.
Similarly, to unfair dismissal applications, the dispute will be listed for conference before a staff conciliator or a Commission Member. The purpose of this conference is to try to resolve the matter.
If the matter is not resolved at a conference, in the case of a dispute dealing with dismissal, the FWC will issue the parties with a certificate authorising the parties to proceed with the dispute before the Federal Circuit Court or the Federal Court. Alternatively, the parties may consent to the matter being arbitrated in the FWC.
It should be noted that the onus of proof in a general protections claim is reversed and falls on the person that is alleged to have taken an adverse action. Accordingly, it is important that legal advice is sought prior to any responses being provided.
Further information or advice
The team at CTI Lawyers are experienced in dealing with both unfair dismissal applications and general protections claims. Contact us today on 02 9021 9699 for further information and assistance.
This summary is a guide only and is not legal advice. For more information on legislative obligations, please call CTI Lawyers on 1300 361 099 or email [email protected].