Fair Work Act 2009 Fair Dismissal Code

The Fair Work Act 2009 sets out the Small Business Fair Dismissal Code which defines the circumstances where summary dismissal is warranted, the steps an employer should take in respect to the performance management of an under performing employee and most importantly a checklist to follow in dealing with the dismissal of an employee. See below.

The Code

Summary Dismissal

It is fair for an employer to dismiss an employee without notice or warning when the employer believes on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal. Serious misconduct includes theft, fraud, violence and serious breaches of occupational health and safety procedures. For a dismissal to be deemed fair it is sufficient, though not essential, that an allegation of theft, fraud or violence be reported to the police. Of course, the employer must have reasonable grounds for making the report.

Other Dismissal
In other cases, the small business employer must give the employee a reason why he or she is at risk of being dismissed. The reason must be a valid reason based on the employee’s conduct or capacity to do the job.

The employee must be warned verbally or preferably in writing, that he or she risks being dismissed if there is no improvement.

The small business employer must provide the employee with an opportunity to respond to the warning and give the employee a reasonable chance to rectify the problem, having regard to the employee’s response. Rectifying the problem might involve the employer providing additional training and ensuring the employee knows the employer’s job expectations.

Procedural Matters

In discussions with an employee in circumstances where dismissal is possible, the employee can have another person present to assist. However, the other person cannot be a lawyer acting in a professional capacity.

A small business employer will be required to provide evidence of compliance with the Code if the employee makes a claim for unfair dismissal to Fair Work Australia including evidence that a warning has been given (except in cases of summary dismissal). Evidence may include a completed checklist, copies of written warning(s), a statement of termination or signed witness statements.

In the case of small businesses and unfair dismissal claims, FWA is required to consider whether the fair dismissal code was complied with as a preliminary issue and if the code was followed the claim will be dismissed. If the code was not followed FWA will continue to consider whether the dismissal was harsh, unjust or unreasonable. The remedies for unfair dismissal in the case of small business are the same as for large business. Small businesses should ensure that they follow the fair dismissal code checklist.