What’s Unfair Dismissal? Making Sure You’ve Covered All Your Bases.
As a business owner, there is so much to know. So many legal obligations to comply with; clients’ expectations to meet, and business marketing and balance sheets to keep on top of. The list goes in.
When managing a team, the list is even longer.
Growing your team in business can be exciting, fulfilling, and rewarding. It can also be challenging, frustrating, and overwhelming at times when things go wrong and you need to manage people moving on.
I say often ‘In business, prevention is better than cure’ – and that applies when managing your team and moving someone on. Whether they are not the right fit; or expectations for the role were not aligned, or if they just aren’t working out, knowing what you need to do (and not do) during the process of moving someone on can save you both a lot of grief and headaches down the track
How do you move someone on, and not be faced with an unfair dismissal claim?
Unfair dismissal occurs when an employee is dismissed (terminated, fired, sacked – whatever you want to call it), in circumstances that are considered harsh, unjust or unreasonable. The Fair Work Commission is the body that hears and decides on unfair dismissal claims, and there is a lot of information you can obtain about unfair dismissal from the website of the Fair Work Ombudsman.
The rules for small businesses are slightly different when it comes to unfair dismissal, and this is important to understand as a small business owner (a small business here is considered to be a business with fewer than 15 employees, amongst other things).
As a small business, the Fair Dismissal Code applies to you. That means that when you are preparing to move someone on from your team, you should take care to comply with the steps as outlined in the Fair Dismissal Code, and if you are faced with a claim for unfair dismissal, if you can establish/show that you complied with the Fair Dismissal Code then the Fair Work Commission will rule that the dismissal was fair (meaning that a claim for unfair dismissal will fail).
If you are not a small business (that is, if you have more than 15 employees, amongst other things), then you need to take care not to engage in any conduct or process that could be considered harsh, unjust or unreasonable.
So, to make sure you have all your bases covered to protect your business against a claim for unfair dismissal:
Know if you are defined as a small business;
Be familiar with the Fair Dismissal Code;
When terminating a team member (or moving them on), be sure to comply with the requirements of the Fair Dismissal Code;
If you are not a small business you to be mindful of, and have processes in place, to ensure that you do not engage in conduct that could be considered harsh, unjust or unreasonable.
Like so many things in business, having the right team around you is vital to long-term, sustainable success. If you are having issues with a team member, get in touch with your business lawyer to talk through the issues; and get clear on the steps you should take to manage the employee or to terminate them if that is what you have decided is best for your business.
Remember, there is no substitute for preparation – so do take the time to get clear on your processes here. You won’t regret it.
If you’d like some assistance or support, please reach out to us here.
Our resource Legal Advice for Small Business - Ultimate Guide might also be helpful to you.