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3 tips for avoiding unfair dismissal claims in your business

Upset young businesswoman using mobile phone while carrying moving box

Upset young businesswoman using mobile phone while carrying moving box

Have you started noticing strange, odd behaviours from an employee? This may be occurring over time and can include the employee being too aggressive, too intimidating or just plain bizarre.

If you’re the owner of an SME, you have the right to terminate an employee; however, you may be quite reluctant to dismiss the employee for the fear of a costly unfair dismissal claim.

Chances are you are not alone.

Many workplaces can relate to having an employee whose behaviour and conduct is just a little bit off-putting. This “weirdness” may manifest itself as aggression, irritability, or just plain odd behaviour. However, one-off instances of acting strangely or aggressively may not amount to serious misconduct or warrant a dismissal.

According to the Fair Work Act 2009, in considering whether a termination is harsh, the Fair Work Commission (FWC) will determine if there was:

  • A valid reason for the dismissal;
  • Adequate notification of that reason communicated to the employee; and
  • An opportunity for the employee to respond.

Small businesses have different rules for dismissal. A small business is defined as any business with fewer than 15 employees. The Small Business Fair Dismissal Code 2009 provides additional protection against unfair dismissal claims, where an employer follows the Code. The Commission will deem a dismissal to be fair if the employer follows the Code and can provide evidence of this.

If you notice a worker whose actions are questionable and inappropriate and you want them gone, follow these three steps to avoid unfair dismissal claims in your workplace.

1. Maintain records of each poor performance or inappropriate conduct

As a small business employer, you will be required to provide evidence of the compliance with the Code, if the employee makes a claim for unfair dismissal to the Fair Work Commission , including evidence that a warning has been given. Evidence may include copies of written warning(s), a statement of termination or signed witness statements.

2. Record each conversation or meeting had with the worker

It is important, as an owner of an SME, to give the employee a reason why they are at risk of being dismissed. The reason must be valid based on the employee’s conduct or capacity to do the job. These conversations or meetings must be recorded and handed in as evidence to prove that the dismissal was fair in the circumstances, should the employee file an unfair dismissal claim.

If the warning is performance related, the employee should be provided a reasonable period to improve their performance. In order to assist them, you may consider providing additional training and ensuring the employee understands the employer’s job expectations.

You can make performance management easier by using various HR platforms, many of which include policy documents and record-keeping functions of complaints can help you keep track of employee behaviour. This can help ensure that your workplace is a safe, productive working environment for all of your members and staff.

3. Provide the employee an opportunity to respond to the dismissal

In the dismissal meeting, the employee should be given the opportunity to respond to the proposed dismissal, prior to making a final decision to terminate their employment.

Making the decision to terminate an employee is often a difficult one, particularly for SMEs who may feel exposed to claims of unfair dismissal. But by understanding the relevant code and implementing a procedure, like the one set out above, both parties can avoid any feelings of unfair activity.

To learn more about the rights and unfair dismissals within the workplace, seek external advice from places such as Fair Work Ombudsman.

About the author: 

This article was written by Barry Lehrer, Founder and Director of DiffuzeHR. DiffuzeHR is transforming the way SMEs approach HR by giving you access to an easy-to-use cloud-based platform that reduces takes the pain out of managing your HR. DiffuzeHR helps minimise risks, reduce legal fees, decrease time spent on admin, attract and retain staff and leverage best-practice HR expertise in a way that is simple, easy and efficient.