Before You Dismiss An Employee

Interview between Catherine Gillespie, Director of Workplace Conflict Resolution, and Martin Reid, Principal and Head of Litigation at Coulter Roache Lawyers, discussing protocols and legal considerations for employers in Australia considering dismissal of an employee.


Catherine:  Hi I’m Catherine Gillespie Director of Workplace Conflict Resolution and I’m speaking with Martin Reid, Principal and Head of Litigation at Coulter Roache Lawyers. Thanks Martin.

Martin:  It’s my pleasure Catherine.

Catherine:  Thank you. I’d like to follow up on the concept of unfair dismissal which is also covered in the Fair Work Act. It seems to me as though a number of cases are making their way to federal courts and are being upheld. What is it about unfair dismissals that employers seems to be getting wrong?

Martin:  The problem with the dismissal is that, it’s such an emotional time for employers and decisions are often taken in haste.

Martin: I think the biggest mistake that employers make will be that they take a decision that this employee must go without trying to comply with their obligations under the Act. So many times the employer will find that a court order or the Fair Work Commission will sanction them for what they’ve done to the employee.

Catherine:  I suppose that’s what I see in my work with conflict is the emotional side of it and the conflict that it creates. If employers slow down and don’t make that decision in haste, what things should they be considering if it’s to be a true dismissal a non-unfair dismissal?

Martin:  Well, they need to consider what their obligations under the Act are. The most important ones are the obligations to procedural fairness, whether or not the decisions that they are taking about the employee, the employee has had some involvement with it. So the employee understands that their performance, for example, hasn’t been up to scratch. If they hadn’t improved their performance they could lose their position. One of the biggest mistakes that are made by employers are they simply don’t tell their employees what’s going on because they like to be nice to them. They don’t want to upset them.

Catherine:  So is this a difficult conversation?

Martin:  It’s a difficult conversation to have. When it comes to a point when they decide that the employee can no longer stay with the business. The employee’s left saying, “You didn’t tell me. How would I know?” That is why you end up in the Fair Work Commission or in the Federal court.

Catherine: Okay. So our conversation there was about staying out of the Fair Work Commission for an unfair dismissal claim. But it seems to me as though many employer are prepared to make that dismissal thinking that the worst that can happen is though just make a payment to the past employee at conciliation. Worse, other things could happen, reinstatement, or what happens if the employee doesn’t make an unfair dismissal claim, they make some other type of claim? What could be some of those scenarios that an employer might face?

Martin:  You are right Catherine. A lot of times employers simply don’t think about the consequences of their actions and when they come to me a lot of time they’ve said, I’ve made a mistake, how much is this going to cost me? Perhaps I should just pay some money to make it go away, and in the majority of cases they will. An employee will accept a payment as an acknowledgement that’s what happens to them has been unacceptable. But of course there are other avenues an employee could take. For example an adverse action claim or a discrimination claim. They could have greater consequences for an employer. They could also mean a much larger fines in the federal court and also much larger compensation claims.

Catherine:  Yes. And so this decision that you say sometimes is made in haste and is quite emotional about dismissing an employee, really could have far greater consequences that employers might not have thought about and so again would this be something that before making the decision they can come to you to have that discussion and perhaps get some steps to make it a logical process, think about other consequences and make an informed decision?

Martin:  I think that’s a very important point. The biggest problem for an employer will be, how will this dismissal be perceived by an employee and that’s why they come to us asking for assistance.  A lot of times an employer will take a step based on and what they would consider reasonable business decisions where the employee is not performing. However from the employee’s perspective they might say, this is discrimination, I’ve been picked on, I’m the only woman in the place, however you are dismissing me. And that can be very, very difficult to defend for an employer. It means it’s very important that the employer has, if you like all its ducks in a row before it decides to take the decision to to terminate somebody so that, should a dismissal application be brought, an employer can say, no, these are were the reasons why, it is because of your performance. And if those written records for example aren’t there, then the employee’s entitled and the Commissioner is entitled to be believed that perhaps there was a discriminatory reason for the dismissal.

Catherine:  Which I think might sort of blind side a couple of employers because they didn’t think of that from a different perspective or a different angle at all. And so that’s where your advice will be really important to broaden their perspective on what could happen.

Martin:  I think it’s an important point to make that the Act actually puts the onus on the employer to demonstrate the reason for the decision. So the employee can allege that the reason for the decision to take, to lose their job, was taken for discriminatory purpose and it’s up to the employer to prove to the Commission and to the Court’s satisfaction that no the reason, that was not a prohibited reason perhaps, it was simply a matter of performance. If you don’t have the documentation to prove that then you can be in real trouble.

Catherine:  Yes. So we are seeing this concept of unfair dismissal to be actually a very important aspect of being an employer and running your business and could get you into bit of trouble if it’s not understood properly and so really important topic to give quite a bit a consideration.

Martin:  Most definitely. As I said the employment relationship is a very important relationship for both the employer and the employee. Any step taken to terminate that relationship should be taken carefully and on a considered opinion.

Catherine: I think it would be great if people came to you to have that consideration element added, to take the emotion out of it. Thanks for speaking with me Martin.

Martin: My pleasure Catherine.

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