Unfair Dismissal

By on January 18, 2016

PHILIP BREWIN of Nevett Ford Lawyers provides case studies on the consequences of contravening the Fair Work Act 2009 (Cth).

Earlier this year, two cases heard in the Fair Work Commission demonstrated the cost to employers in dismissing employees in contravention of the Fair Work Act 2009 (Cth).

In the matter of Helen Lyberopoulos v Reidwell Investments BT Pty. Ltd. T/A Coco Cubano Blacktown [2015] FWC 4256, the employee was employed for less than seven months before she was summarily dismissed.

The employer claimed she failed to comply with their procedures and did not follow directions. The parties contested the facts of the case and Senior Deputy President Drake had to determine whom to believe. She accepted the employee’s evidence over the employer’s because the employer did not seem to be a credible or reliable witness.

The Commission found that the employee was not appropriately warned her actions may lead to the termination of her employment and the reasons for her dismissal were therefore harsh, unjust and unreasonable.

As the employee was unable to obtain alternative employment until 24 weeks and three days following the termination of her employment, Deputy Senior President Drake ordered that the employer pay compensation to the value of 24 weeks and three days’ worth of the employee’s salary, being $36,267.

It is important for employers to note once employees have been employed for six months, they are eligible to make an unfair dismissal application to the Fair Work Commission. For such applications, the amount of compensation is capped at 26 weeks of an employee’s pay but, considering the time and costs of defending such matters, the total cost to an employer can be significantly greater.

In the matter of Luca Balatti v Aussie Supplements Pty Ltd [2015] FWC 4674 the employee had been working as a sales manager for three years when he received a telephone call from his employer alleging he was being investigated for the sale of illegal drugs whilst at work.

The employee was advised he would be dismissed from his employment and, several days later, received a letter confirming his immediate dismissal. The employer then failed to pay the employee’s accrued statutory entitlements upon termination, such as annual leave, and failed to participate in a conciliation conference and hearing before the Fair Work Commission. Commissioner Cambridge found the dismissal harsh, unjust and unreasonable because the employer advised the employee of his termination by telephone and the letter of dismissal did not provide any reasons for the dismissal. As a consequence, the employer was ordered to pay $17,880.

Under section 117 of the Fair Work Act 2009 an employer is obliged to provide notice of termination in writing. But as the decision in Clark v Framlingham Aboriginal Trust [2012] FWA 7103 shows, the failure to provide written notice does not make the termination any less effective if the employee has been notified (by whatever means) his employment has been terminated.

To prevent a termination of employment being contested as an unfair dismissal an employer needs to ‘tick off’ the criteria set out in section 387 of the Act. Amongst those criteria are that an employer needs to provide reasons for the termination to the employee and an opportunity for the employee to respond to allegations and/or an opportunity to improve performance. As demonstrated in Balatti, the consequences of failing to comply with these requirements can be significant.

Preventive law is best. It is recommended that employers obtain legal advice on workplace termination before any action is taken.

Nevett Ford are specialised in this area and are able to provide advice on all aspects of workplace relations.

Contact our workplace relations team:
Philip Brewin, Accredited Specialist in Workplace Relations, Greg Doran or Melita Demirova on (03) 9614 7111.

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