How to Dismiss an Employee Fairly – 10 Top Tips

This article has been prepared by Colin Biggers & Paisley Lawyers.

Dismissing an employee and avoiding a successful unfair dismissal claim can be a minefield for employers. We provide the following 10 top tips to consider prior to dismissing an employee: 

1. Probation – always check whether an employee is within, or has passed, their probationary period prior to dismissing. For unfair dismissal purposes, the probationary period will generally be 6 months for employers with 15 or more employees, and 12 months for employers with less than 15 employees. An employee is only able to make an unfair dismissal application if they have passed their relevant probationary period. However, employers must remember that employees within probationary periods can still bring other claims, for example general protections claims. 
   
2. Jurisdiction – if you receive an unfair dismissal application, you must first ask yourself whether the relevant employee has the jurisdiction, or is permitted, to bring the application. If an employee is not legally permitted to bring the application, then the application can be dismissed. An employee may not be permitted to bring an unfair dismissal application where they have lodged the application more than 21 days after the dismissal, where the dismissal was a genuine redundancy, or if they weren’t actually an employee (i.e. they were an independent contractor), and for other reasons. 
   
3. Small business employer – “small business employers”, meaning employers employing fewer than 15 employees, may only need to follow the Small Business Fair Dismissal Code, and not be held to the more rigorous unfair dismissal test. 
   
4. Valid reason – you must have a “valid reason” for a dismissal to be “fair”. The cases tell us that a valid reason is a reason that is “sound, defensible or well founded” and not “capricious, fanciful, spiteful or prejudiced”. 
   
5. Differing treatment – do you have a group of employees who have all engaged in misconduct? Without just cause, disciplining employees differently can make a dismissal unfair. 
   
6. Does the crime fit the punishment? Sometimes performance or conduct concerns do not warrant dismissal, and may instead warrant other disciplinary action (for example, a final warning or demotion). Whether other disciplinary action would have been more appropriate may be considered in determining whether a dismissal was unfair. 
   
7. Opportunity to respond – you must give an employee an opportunity to respond to any proposed reason or reasons for dismissal. This means providing an employee with a real opportunity to give you their side of the story before you make a decision to terminate their employment. 
   
8. Support person – employers must not unreasonably refuse to allow an employee to have a support person present to assist at any discussions relating to dismissal. We recommend that an employee is expressly offered the opportunity to bring a support person to such meetings. A support person is generally not an advocate, but rather is there for emotional support (however this may depend on the terms of any enterprise agreement). 

Warnings – if there are performance issues with an employee, then the employee should generally be warned in relation to the issues prior to dismissal. If the issues are in relation to the employee’s behaviour, best practice would also require a warning prior to dismissal however it is not required for unfair dismissal purposes. Warnings should always be clear and outline the performance or conduct concerns and how the concerns can be addressed by the employee. If the warning is serious, and to be relied on for unfair dismissal purposes, then it should generally also state that further performance or conduct concerns may lead to further disciplinary action which may include termination.