Navigating the maze – unfair dismissal and general protection claims

9th July, 2024

Unfair Dismissal

Part 3-2 of the Fair Work Act 2009 (Cth) (FW Act) allows national system employees to apply for an unfair dismissal remedy if they consider that the termination of their employment was “harsh, unjust or unreasonable”.

Meaning of dismissal

For the purposes of making an unfair dismissal claim under the FW Act, an employee must have been “dismissed”. An employee is taken to have been dismissed where:

  • the employee’s employment was terminated on the employer’s initiative; or
  • by constructive dismissal, whereby the employee resigned but was forced to do so because of conduct (or a course of conduct) engaged in by the employer.

Harsh, unjust or unreasonable

A dismissal will be considered unfair if it was “harsh, unjust or unreasonable”. Factors which the Fair Work Commission (FWC) will consider when considering whether a dismissal is unfair include:

  • whether the employer had a “valid reason” for dismissal relating to the employee’s capacity or conduct (ie. because of misconduct);
  • whether the employer accorded the employee “procedural fairness” in the process leading to the dismissal; or
  • any other matters that the FWC considers relevant, including the proportionality of the penalty and the employee’s age, length of service and disciplinary record.

Exclusions

An employee may only make an application for an unfair dismissal remedy if they have completed a minimum employment period of 6 months, or, 12 months where the employer is a ‘small business’ (a small business is a business that employs fewer than 15 employees).

The unfair dismissal protections do not extend to employees who earn above the high-income threshold, which from 1 July 2024, is $175,000, unless the employee is covered by an award or an enterprise agreement applies to the employee.

In addition, an employee cannot make an unfair dismissal application if the dismissal was:

  • a case of genuine redundancy; or
  • effected in accordance with the Small Business Fair Dismissal Code (in the case of a small business employer by which special unfair dismissal arrangements apply recognising that small business do not have the same resources to manage dismissals as medial and large businesses).

Remedies

If the FWC is satisfied that a dismissal is unfair, there are two remedies it may grant an employee:

  • an order to re-instate the employee; or
  • an order to pay compensation.

The amount of compensation is capped at 6 months’ pay (to a maximum of $87,500) being half the high-income threshold.

General Protections

The “general protections” provisions in Pt 3-1 of the FW Act prohibits the taking of “adverse action” by various persons (eg employers or principal contractors) against other persons (eg employees or independent contractors), where that action is taken because of the other person’s right, activity or status.

Adverse action

Adverse actions against employees include dismissal, injuring an employee in their employment, altering the position of an employee to their prejudice, and discriminating between employees.

Right, activity or status

The types of right, activity or status that are protected under the FW Act include:

  • workplace rights;
  • membership of an industrial association or participation in industrial activities; or
  • protected attributes (eg. race, age, sex, sexual orientation, marital status, religion).

Workplace rights

Workplace rights include that a person:

  • is entitled to the benefit of, or has a role, or responsibility under, a workplace law, workplace instrument or order made by an industrial body;
  • is able to initiate or participate in a process or proceeding under a workplace law or workplace instrument;
  • is able to make a complaint or inquiry to a person or body having the capacity under a workplace law to seek compliance with that law or workplace instrument; and
  • being an employee, is able to make a complaint or inquiry in relation to their employment.

Reverse onus of proof

An important feature of a general protections claim is that the burden of proof is reversed once the claim is sufficiently particularised by the employee.  This means that the employer must then prove the action was not for a prohibited reason.  For example, if an application is made alleging that an employer dismissed an employee because the employee exercised a workplace right, once it is established that the dismissal took place and that the employee exercised a workplace right, it is presumed that the employer dismissed the employee because the employee exercised a workplace right, unless the employer proves otherwise.

Remedies

Breaches of the general protections provisions in the FW Act are “civil penalty provisions”.  This means that persons who contravene those provisions are liable for monetary penalties.  In addition, orders for compensation (with no cap) and injunctions (interim and permanent) are also available.

Conclusion

There are subtle but important differences between unfair dismissal and general protections claims, including a person’s eligibility to make such claims and the remedies available.  It is important that these subtle differences are properly understood before pursuing or defending claims of these nature. MPH Lawyers has vast experience in employment law disputes – please contact Nigel Pakes or Daniel Murdzoski by email on napkes@mphlawyers.com.au or dmurdzoski@mphlawyers.com.au or on (08) 9221 0033 if you require any assistance.

Print page