The unfair dismissal trends your business needs to know

Business woman

It’s a nightmare that keeps many business owners awake at night.

Unfair dismissal is no joke. After several years, the Fair Work Commission has created a nice package of cases that define employment law pretty clearly for any business paying attention. The result? A system in which you can absolutely sack someone – but if you don’t play exactly by the rules, it’s going to be very tough.

And painful. It might even be getting worse for employers.

Over the past few years, there have been hundreds of unfair dismissal cases heard before the Fair Work Commission. Here are just a few that illustrate just how important key procedures are in a business – and some of the newer trends in unfair dismissal that all businesses need to be aware of.

Process matters

Employment law experts say they’ve noticed the Commission now emphasises procedure a lot more than it used to. You might even have the worst employee in the world, be justified in letting them go, but if you’ve mucked up one small step along the way, then prepare to suffer the consequences.

“When cases are being examined by the Commission, they’re looking loosely for what the employer does to bring the conduct to the attention of the employee,” says Rachel Drew, partner at law firm Holding Redlich.

“One of the basic points of unfair dismissal is that you need a good reason, and you have to follow a process. But we’ve seen some claims lately where you think the reason is enough, but it won’t be – the Commission emphasises the process.

“There have been a few surprising decisions in that manner.”

Decisions like G. Szentpaly v Basin Sands Logistics from 2013 fall into this category.

Szentpaly was hired by Basin Sands to work a loader on a mine site. He completed a 12-hour shift but then finished the shift early due to problems he had experienced with the loader. The next morning, he was asked why so few loads had been completed. The employee replied he had assumed the company had been aware of the problem.

It’s a complex case, but while the Commission found that the company may have had a valid reason to terminate the worker’s employment, he wasn’t given proper time to respond to the allegations.

That cost the company, which was forced to pay nearly $8,000 in compensation.

These types of cases are becoming more common, says workplace lawyer Peter Vitale.

“There continues to be a strong focus on process,” he says.

But Vitale adds a caveat that he says could be quite dangerous: employees are now beginning to use unfair dismissal laws against their employers.

Vitale doesn’t mean an employee rightfully defending themselves under the law. Instead, he says employees who have knowingly done something wrong are beginning to understand how to use the emphasis on process to turn the tide against their boss.

“There is an increase in the range of cases which involve unusual circumstances, in respect of the employee…with a lot of cases centred on personality conflicts in the workplace,” he says.

“I think in a lot of these cases we’re finding that the Commission is, in the absence of tangible conduct to fix on, such as unsatisfactory performance or behaviour … there needs to be a focus on procedure.”

For example, Vitale says, a business may put an employee under a performance management program and then the employee responds with bullying accusations, which can develop into claims of workplace-related distress.

While these can often be legitimate claims, Vitale says employees are sometimes using these to their advantage.

“There is a willingness by employees to … take this approach,” he says.

Social media still on the radar

There also continues to be an emphasis on social media and digital communication in the Commission’s ruling, says Drew, especially those communications made outside of work hours or the workplace itself.

The first of such cases was arguably one 2012 case involving Linfox, in which an employee was sacked for making comments on Facebook.

“There is a very strong trend that even if social media might be occurring outside of employment, it’s something that can impact on the reputation of the employer,” Drew says.

“Even if you have your privacy settings on, there are groups of people within your Facebook friends who are seeing what you’ve written, and they can identify you as an employee of the business – that’s taken into account.

“Employees can’t just rely on privacy settings.”

Be consistent

One of the most frustrating problems for a business is legacy knowledge: being able to recall how exactly you’ve responded to past events.

That can be a problem when dealing with unfair dismissal. In 2014, the NSW Industrial Relations Commission reinstated a public servant after it was found he was treated more harshly than another colleague for the same behaviour.

During a Christmas party, one employee admitted to groping the breasts of several colleagues. But another colleague who was also allegedly involved in sexual harassment was only demoted, whereas the first employee was sacked.

“Consistency in penalties is so important,” says Drew.

“Employers need to have a very sensible and cogent approach about conduct. Sometimes it can be an emotional decision … but it has to be done fairly and objectively.”

The Uber driver 

With the rise of “side-gigs” as a legitimate form of income, more workers are earning extra cash by renting out a room through Airbnb, freelancing or even driving an Uber on the side. And it’s only going to be more important for employers to judge how they treat employees who are working with multiple jobs at the same time.

Of course, it doesn’t work out for everyone.

In Perth, a worker at a newspaper printing facility was sacked after his employer found out about his Uber side gig. The employee wasn’t given permission to undertake the second work, in breach of his employment agreement.

The case has clear ramifications for employees hoping to do side work of their own, but Drew says it has ramifications for businesses as well. As this issue becomes more common, she says, businesses need to know how they’ll deal with it – and the answer isn’t always clear.

“If you’re a part-time receptionist and you work Monday to Tuesday, it’s difficult to see how there could be conflict if you have another job on Wednesday and Thursday,” she says.

“However, if you are a full-time employee and you’re driving Uber after hours, your employer is entitled to ask questions about that and it’s entitled to reach a conclusion about whether that employment is consistent with whatever you’re doing.”

However, Drew says employers need to be wary about approaching any extra employment as a breach of an employment agreement. It depends on the circumstances, she says.

“One thing they can take into account is if you’re driving an Uber until midnight, for instance, and if that leaves the person too tired to do their job.”

“But if they’re only working until 8pm, you would have a harder time suggesting those extra hours of work genuinely interfere with the day job. It all depends.”

Adopt policies for the future

In another example of businesses maintaining poor policies, one case in 2014 involved an employee who had to leave work to attend a hearing related to domestic violence.

The employee had previously been warned about taking unauthorised leave. But because she was embarrassed to mention the issue, she had only told a few colleagues and her immediate supervisor.

One hearing the employee was mandated to attend suffered a time change. But the employee didn’t tell her superiors, and went anyway. This unauthorised leave led to her sacking.

Once again, the Commission found the company was at fault for not giving the employee proper time to respond.

While Vitale says the case shows how important it is to maintain clear procedures, he also says businesses need to start thinking about how they develop policies to respond to these types of cases.

Consideration in the workplace of domestic violence is a relatively new issue to be formalised and many businesses haven’t even started. But Vitale says this will only become a more important issue, and businesses need to get started now.

“To some extent, this case at its core is about the employer not taking an appropriate procedural approach to an employee who was unauthorised leave,” says Vitale.

“But it also reflects a failure on a broader front, and it highlights the law.

“The courts are meant to reflect community values, and I think what it illustrates is that community values now hold that employers should be considerate of employees who have these circumstances in their lives.”


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5 years ago

“… One of the basic points of unfair dismissal is that you need a good
reason, and you have to follow a process….”

These are 2 points.

Is anybody arguing that you don’t need a reason or to follow a process???

not quite sure what the point of this article was.


John Hutchinson
John Hutchinson
5 years ago
Reply to  frank

The point is that it is a small Business Website which offers tips to small businesses (most without a HR department) to keep abreast of these issues without losing money or time researching them and more importantly to plan for them. There are plenty of small businesses who do argue that you don’t need procedures or a good reason who end up at the commission (spending hard earned money on defending their case).

T.J . Antipodes
T.J . Antipodes
4 years ago

Small businesses should join places like Employsure. It will save them a lot of legal fee’s and is far more efficient than lawyers.

There is so much compliance these days, some of the most productive people in business are wasting time

The documentation employers require versus vexatious innuendo from employee’s is incredible, yet the systems lets them waffle, waffle on, and takes it for granted.

This country treat sis employers like garbage. We are high wage country and most employers I know are more flexible than their employee’s and its struggle to make money out of many people. Most people are not making anywhere what they think for their employers.

Dont worry the real estate bubble will burst, the economy will collapse,we will drop from being first world and then people will wake up.

I bet you Germany has a far better system, Their general civil legal system leaves ours for dead.

T.J . Antipodes
T.J . Antipodes
4 years ago
Reply to  frank

Employers are too kind to many bad employee’s and you need records and masses of paperwork. Ask an employer,r until you have been there you cannot understand how biased it is. Its rubbish and employee’s play a lot of games. They rort the system Like a sickie, thats very Australian.

Michael Ratner
Michael Ratner
5 years ago

The point of the article was to indicate in spades the mechanism that empowers employees to game the system. Employers are put on notice to waste time documenting everything on the off chance they might have to sack someone. It’s the employers business, they are giving someone a job with an entitlement to keep referring to these ridiculous rules. It’s skewed and unfairly so.
No employers I know sacks good co-operative workers. Employees with attitude must be able to be terminated.

T.J . Antipodes
T.J . Antipodes
4 years ago
Reply to  Michael Ratner

It will send jobs overseas. Employers are people too and they have had enough.

The bad employee’s play the system in every way. They make people loathe running their businesses, they are like a virus destroying workplaces and the rest of the staff wish the employer could rid of the junk easier. The bad ones help you lose the good ones.

People wanting to start a business, note this backward country wants to take away many of your human rights, and wants to screw you for tax, be responsible for everything, let bad employee’s be responsible for next to nothing. Plus give us medicore infrastructure. This country is pricing itself out of the world market.

Cost for wages and goods in supermarkets are far high than Germany. Do you think that stupidity can continue forever.

We need a major over haul of laws for employers

No wonder employers leave people as casual’s .

Michael Ratner
Michael Ratner
4 years ago

Hey T.J. it looks like we are the only two people who see the disadvantages that apply to employers.

Go and read this thread and then read my reply.

Michael Ratner • 19 minutes ago

Is there anywhere else in the world who adopt this politically correct, level playing field, equal opportunity bullshit.
I’d never heard of Honey Birdette before this thread started. Surely they have every right to employ who they want to and to a standard that suits their business.
Doesn’t common sense indicate that hairy blokes in singlets and work boots need not apply. I mean the same thinking if you took your car to an auto shop and the mechanic arrived in lipstick and high heels, singlet of course – I wonder how long they would have customers.
We have to allow employers to employ to their standard and if we don’t fit in with that, stop complaining and go and find something else to do.
If you apply for a job as a personal trainer and you happen to be an overweight slob with a cigarette dangling out of your mouth the employer has to lie to you when the truth might be a wake up call.
Come on everyone we have to learn to go responsible for ourselves instead of looking to blame the system.
Good on ya Honey Birdette. Stick to it.

5 years ago

wow – guess I’m a bit surprised. Why do you think it’s skewed? What is the issue in requiring a valid reason for sacking somebody, and having a simple basic process to follow? Aren’t employers capable of doing that?

T.J . Antipodes
T.J . Antipodes
4 years ago

The community should value that employers are human being and should not have to work excessive hours , not take many holidays , not have time with their families.

The bosses In know are more flexible than the employee’s

Ask an employer than start someone and how often you find they actually cannot do the job or scope of tasks a person was employed for.

Its these people who create SME companies and why 61% of australian have jobs. They deserve respect. But there is little.

In Germany they know if the company fails they dont have job.

Here it’s the boss has lot of money lets screw them. The time theft ion Australia is amazing.

if a business cannot make money it closes and 50% only last 5-7 years and the employee’s are the reason,and the bosses find it hard to get efficient work from them many of the,

T.J . Antipodes
T.J . Antipodes
4 years ago

If you are an employee join somewhere like Employsure, as small to medium SME can have its own HR department via a place like them. If you are starting a business join from day 1, make it part of the plan.