As a business owner, if you have to dismiss an employee there is always a chance they will make an unfair dismissal claim against you. Obtaining advice before dismissing the employee will place you in a good position to defend the claim.
We now look at the unfair dismissal process and what you need to do if a claim is made.
It all starts here…
A former employee who thinks they have been unfairly dismissed can lodge an Application with the Fair Work Commission (FWC). Generally, this must be done within 21 days of the day they were terminated.
Once an Application has been made:
- The FWC will forward a copy of the Application (Form F2) to you. It is important to remember that this is a legal process and it won’t just ‘go away’;
- You have 7 days to submit your response (Form F3) and provide the former employee with a copy; and
- You can also submit any jurisdictional objection you may have (via Form F3 and/or Form F4).
- The matter will be listed for conciliation and the FWC will provide both parties with a Notice of Listing, which sets out the date and time you need to attend the conciliation; and
- The conciliation will be held via telephone, with both parties and a FWC conciliator.
What happens at conciliation?
Conciliation is a voluntary process to help an employer and former employee settle the dispute. If you choose not to participate in the conciliation, the unfair dismissal claim will go directly to a hearing or conference at the FWC.
At the start of the conciliation, the Conciliator will call both parties into a telephone conference call and will usually make some opening remarks including that the conference is private and confidential and the aim of the conciliation is to help the parties resolve the matter by mutual agreement. If either or both parties have a lawyer representing them, the Conciliator may also discuss this (more on this later).
The Applicant (employee) will then make their opening remarks and the Respondent (employer) will have an opportunity to respond. There may be some further discussion for the benefit of the Conciliator or the other party to resolve any factual issues or to raise any other significant points. The Applicant will then be asked what remedy they are seeking.
From here, a negotiation commences and the Conciliator will spend time with both parties separately and privately to try and mediate a resolution of the matter. The Conciliator is independent and impartial and will not take sides but they may point out the relevant strengths or weaknesses of each case as well as any common ground.
Typical outcomes of a conciliation include the payment of compensation by the employer (usually for lost wages), reinstatement (although this is usually unlikely given the relationship has probably broken down), or an opportunity to allow the Applicant to ‘resign’ which may be a preferred outcome if the employee was dismissed for misconduct or poor performance.
If the matter settles, the Conciliator will advise the parties that an agreement has been reached and the parties will be asked to sign a written Agreement (or Deed). This Agreement outlines the agreed terms and typically includes a ‘release’ clause which requires the Applicant to discontinue their FWC unfair dismissal claim once the agreed terms have been completed. Other typical terms include confidentiality and non-disparagement for both parties.
Settlement at conciliation is on a ‘no admission’ basis and is confidential. You may agree to settle the matter on a commercial basis to avoid the time and cost of attending a conference or hearing and to give you control over the outcome.
What if the matter doesn’t settle at conciliation?
If the matter does not settle it will be listed for a conference or a hearing which are both more formal and usually held at the FWC offices before a Member (who plays a similar role to a judge).
A conference is a private and less formal process where a Member of the FWC will hear from both parties. The Member will usually assist the parties to discuss and resolve the issues via conciliation or mediation, however, they are still able to make a binding decision if necessary.
If the matter proceeds to a hearing, after listening to all the evidence a member of the FWC will make a decision as to whether or not the Applicant was unfairly dismissed, and if so, the remedy they will receive (if any) – this may include reinstatement or compensation. A hearing is a formal process where evidence is provided by witnesses in a witness box and both parties are required to provide an outline of submissions and to present their case. While both parties can represent themselves, often one or both of the parties will have a lawyer represent them.
What is a jurisdictional objection?
An employer may object to the FWC hearing the Application on the basis that the FWC does not have jurisdiction (the power) to hear the matter. For example, the Application may not have been made within 21 days or the employee may not have worked long enough to meet the qualifying period.
Other arguments include that the employee was not dismissed, that you weren’t actually their employer, that you have complied with the Small Business Fair Dismissal Code, that the employee earns more than the high income threshold, that the employee has already made another claim in relation to the dismissal, or the dismissal was a case of genuine redundancy.
When submitting your Employer Response (Form F3) you can identify any grounds on which you want to object to the Application being made. You can also submit a separate Form F4. Sometimes the jurisdictional objection will be heard by a Member before the conciliation, however, often both the jurisdictional objection and the merits of the unfair dismissal will be dealt with at a hearing or conference at the same time.
Representation by a Lawyer
While parties can represent themselves throughout the unfair dismissal process, you can have a lawyer represent you. The lawyer may need to seek the permission of the FWC to represent you at the conciliation, conference or hearing, however, permission is commonly granted. While parties can navigate the process themselves, having a lawyer prepare the forms for the FWC, raise the jurisdictional objections or advocate on your behalf can be a worthwhile investment.
At Robertson Hyetts we have assisted many employers to successfully defend or resolve unfair dismissal claims. If a claim is made against your business, we can help you through the process and advocate on your behalf. Call our team on 03 5434 6666 (Bendigo) or 03 5472 1588 (Castlemaine) for a no obligation discussion of your unfair dismissal matter or for general advice or support on a HR or employment issue.