Termination of employment can be one of the difficult realities of business. It may occur through voluntary resignation by the employee or dismissal by the employer, on the grounds of redundancy or for other reasons. There are a number of things to consider in going about terminating an employment relationship, for both employers and employees.
What is a redundancy?
Redundancy occurs when an employer no longer requires an employee’s job to be done by anyone. Subject to the length of service, type, and conditions of employment, employees may be entitled to redundancy pay.
A genuine redundancy occurs when:
- the employer no longer requires the employee’s job to be done by any other person, or the employer becomes bankrupt or insolvent;
- the employer has complied with any consultation obligations relevant to an enterprise agreement or award; and
- it would not have been reasonable for the employer to redeploy the employee within the enterprise or other associated entity – the employer must ensure there is no suitable alternative position available.
If a redundancy is not genuine, then the employer can be liable – often costing more time and money than if the correct process had been followed in the first instance.
To avoid the risk of litigation for unfair dismissal it is important that employers understand how to effectively manage and terminate employees, including ensuring any consultation or termination payment entitlements are provided. DKL can provide advice on the process of managing terminations and ensuring that obligations both parties owe each other are upheld.
A claim may be pursued in circumstances where employment is terminated for a range of unlawful reasons. Each case must be individually assessed however examples could include temporary absences related to illness or injury, union membership, making a complaint or participating in an inquiry or legal proceedings against an employer, or absences during parental leave.
In some circumstances, employees may have grounds to make a claim under the ‘General Protections’ provisions of the Fair Work Act 2009 (Cth) (FWA) for unlawful activities (also known as ‘adverse action’), or for discriminatory conduct, harassment or bullying.
Failure to follow policies and procedures can also lead former employees to make a claim of unfair dismissal in the Fair Work Commission, although this must be lodged within 21 days of termination and does not apply to employees earning over the High Income Threshold.
This is a complex area of law and each matter will be assessed in consideration of the relevant circumstances.
How can DKL help?
The decision to terminate an employee can open the door to a potential claim for unfair or unlawful dismissal, and in such circumstances, all parties should obtain professional advice.
Organisations should follow prescribed procedures when managing employees, conducting performance appraisals, addressing misconduct, taking disciplinary action, or terminating employment on grounds of redundancy. Processes should be fair and reasonable and comply with statutory requirements. Workplace managers should ensure they are not only aware of these requirements, but the relevant policies and practices are brought to the attention of their workers.
DKL can provide employers with quality advice to help understand your obligations, assist in organisational restructures and redundancies, write appropriate and effective policies, and help you comply with policies to avoid risk.
If you are an employee and have been dismissed from your employment, and you believe the circumstances surrounding your termination were harsh, unjust, or unreasonable in some way, you may be able to take action against your employer to enforce your rights.
With over 10 years of service, DKL has expertise in all areas of employment law and we have assisted many employers and employees to proactively manage their workplaces, employment contracts, and resolve disputes.