#13069 - Unfair Dismissal Under The Fwa - Employment Law

Topic 7: Unfair Dismissal under the FWA

• Unfair Dismissal Laws in Australia – background and overview

  • Background

    • Purpose of unfair dismissal laws: overcome the limitations of the CL, which permits the termination “for any reason, or no reason”.

    • The FWA allows an employee to seek a remedy if the FWC finds their dismissal harsh, unjust or unreasonable

    • These rights cannot be usurped by the contract

  • Object of the provisions

    • The object of this part is to establish a framework for dealing with unfair dismissal that balances the needs of business and employees, and establishes procedures for dealing with unfair dismissal that are quick, flexible and informal and address the needs of employers and employees s 381(1) FWA

    • The procedures and remedies in 381(1)(b) and (c) and the manner of working out such remedies are intended to ensure that a fair go all round is accorded to both the employer and the employee concerned s 381(2)

    • The expression ‘a fair go all round’ comes from the case of Re Loty & Holloway (1971) 71 AR 95 where the judge said:

    • The objective in these cases is always industrial justice and to this end weight must be given in varying degrees and according to the requirements of the case to the importance but not the inviolability of the right of the employer to manage his business, the nature and quality of the work in question, the circumstances surrounding the dismissal and the likely practical outcome if an order of reinstatement is made’.

• Can the applicant bring a claim? Are they eligible?

  1. They must be a national system employee and the employer a national system employer s 380

  2. They are only protected if, at that time s 382

     • They had been an employee who has completed a period of employment with his or her employer for the minimum employment period; AND s 382(1)

     • Either a modern award covers them, an enterprise agreement OR the sum of their earnings is less than the high income threshold s 382(2)

  • High income threshold

    • High income threshold for the 2014/15 year (ie until 30 June 2015) is $133,000 per annum

      • Threshold is not pro-rated for part time employees, but is a set-limit

    • What are “earnings”?

      • Includes: s 332(1)

        • Wages

        • Non-monetary benefits that can be assigned a monetary value (provided a value has been agreed between the parties or can be reasonably estimated by the FWA FW Regs re 3.05(6)) e.g. mobile phones or vehicles

          • But it must be clear that the employer has agreed to provide that benefit Maturu v Leica Geosystems 2014

        • Amount applied or dealt with on the employee’s behalf (such as deduction to a health fund or trade union)

      • Excludes: s 332(2)

        • Amounts that “cannot be determined in advance” s 332(2)(a)

          • A bonus that is not guaranteed but depends on performance or the employer’s discretion will not be counted Jenny Craig

          • Irregular overtime would generally not be counted because it cannot be determined in advance. However in CBI Constructors, overtime was guaranteed and needed to be counted because the company had not in the past, and did not intend to alter its practice of an employee working the same amount of overtime hours a week.

        • Reimbursements

        • Contributions to a super fund

  • Minimum employment period s 383

    • If the employer is not a small business employer = 6 months ending at the earlier of the time when notice of dismissal was given, or immediately before the dismissal

    • If the employer is a small business employer = 12 months

      • “Small business employer” – having less than 14 employees (straight head count), but excluding casuals UNLESS the casual is employed on a regular and systematic basis. Includes person being made redundant

  • Period of employment

    • An employee’s period of employment with an employer at a particular time is the period of continuous service the employee has completed with the employer at that time as an employee 384(1)

      • “Continuous service” s 22

        • Service is when the employee is employed by the employer

        • The following don’t count as service:

          • Any period of unauthorized absence

          • Any period of unpaid leave or unpaid authorized absence other than community service leave or stand down

          • But these don’t break their continuous services

        • If there is a transfer of employment (where the two employers are associated entities, gap of less than 3 months) or they are getting transferred as there is a transfer in business – not break in continuous service.

    • Are casual employees eligible?

      • Yes, provided they have worked for the minimum period of employment and during the period of employment they were:

        • Employed on a regular and systematic basis and

          • ‘Regular and systematic’ requires a clear pattern or roster of hours and days. Work must be offered and accepted sufficiently often that it is not regarded as simply occasional or irregular.

        • has a reasonable expectation of continued employment with he employer on a regular and systematic basis s 384(2)(a)

        • The Full Bench has said that a casual needs an established sequence of engagements with the employer over the necessary period. This will satisfy s 384(2)(a) even if there are breaks when the casual employee is on leave or takes time off due to illness or injury

        • If does not matter that the casual may have been hired under a series of separate contracts, provided they were part of a ‘contiguous series’ of engagements Shortland v Smiths Snackfood 2010

    • If the employee is a transferring employee in relation to a transfer of business from an old employer to a new employer and they are not associated entities, the period does not count s 384(2)(b)

• Has the employee been ‘dismissed’ for the purposes of section 382(2)?

• A person has been dismissed if

  • Their employment has been terminated on the employers initiative; or s 386(1)(a) Corrie v Sheen Panel Service 2013

  • The person has resigned from his or her employment, but was forced to do so because of conduct engaged in by his or her employer s 386(1)(b)

    • Employers act must directly or consequentially end in termination without the employee’s voluntary resignation Kylie Bruce v Fingal Glen. This requires an objective assessment of all the circumstances giving rise to termination, the seriousness of issues and the conduct of both parties.

      • Also look at what options the employee had

    • Also requires that the employer either intended to force resignation OR resignation was the probable result as the employee had ‘no effective or real choice but to resign’ Kylie

      • Clearly covers situation where an employee is pressured into resigning under threat of being fired Mohazab

      • Includes where the employee resigns due to threatened or impending dismissal or in response to an employer’s unacceptable conduct Kylie Bruce v Final Glen 2013

      • Won’t include situations where payments are made a few days late, but might include situations where delays were long Kylie

    • There is no dismissal where an employee resigns of their own accord and cannot establish any fault on the part of the employer

  • A person has not been dismissed if:

    • They were employed under a contract for a specified period of time, for a specified task, for a specified season, and the employment has terminated at the end of it s 386(2)(a)

      • However if they are let go in the middle of their contracts, can potentially make a claim

      • May make it hard for a casual to claim unfair dismissal, if the employer has done no more than fail to offer more work.

      • But if a casual has worked regularly for 12 months, and there is no clear evidence of limited-term hiring, they may still be able to show that they have been dismissed rather than just denied another contract Mills v Lextor Developments 2010

    • The person was a trainee s 386(2)(b)

    • The person was demoted but the demotion does not involve a significant reduction in his or her remuneration or duties; and he or she remains employed with the employer that effected the demotion s 386(2)(c)

      • This was inserted to exclude claims by employees who had been demoted and argued they were eligible for a remedy on the basis that their contract had been terminated, even if their employment had not.

      • But this is so only where there is no ‘significant reduction’ in their remuneration or duties

      • Otherwise, an unauthorized demotivation can be regarded as a dismissal, even if the employee does not resign Visscher

      • Would also appear that there is no dismissal when the K is frustration or when an employee abandons their job

    • These exclusions don’t apply if the employer is using it as a way to get around obligations s 386(3)

      • However, this is difficult to establish in practice.

• Has the employee been unfairly dismissed?

  • A person has been unfairly dismissed if the FWC is satisfied that: s 385

    • The person has been dismissed (see above) and

    • The dismissal was harsh, unjust or unreasonable; and

      • Introduction:

        • Case will be determined on its merits by the FWC. The assessment must balance the right of an employer to control enterprise (not an absolute right) with the rights of an employee to be treated fairly in the circumstances Loti v Holliway

        • Words are given their ordinary meaning Byrne & Frew v Australian Airlines

          • Harsh = on the employee

          • Unreasonable = in the circumstances

          • Unjust = because the employee didn’t do what they were accused of

            • If an employee is reported to police etc their dismissal cannot be challenged, even if the allegation is not substantiated Khammaneechan v Nanakon 2010

      • Section 387 criteria for considering harshness – the FWC must take into account all these criteria.

        1. whether there was a valid reason for the dismissal related to the...