With so many businesses in the process of recruiting new staff, we are often required to provide advice on dismissal of employees during probation, and in particular around the subject of whether or not an employer is obligated to provide a reason for the termination.
If an employee has not completed the minimum employment period, the employee is not entitled to make a claim of unfair dismissal. Therefore, many businesses question whether they need to give an employee a reason for dismissal and formally document the process.
Whilst an employer is not obliged to provide a reason for dismissal, it is certainly advisable to do so in order to alleviate the possibility of the employee seeking compensation, particularly if the employee feels that there is a reason for the dismissal that does not align with that of the employer. While the employee is not entitled to claim unfair dismissal, they may pursue a General Protections Claim.
General Protections claims are brought by employees who believe that they have been dismissed for an unlawful reason (eg that they were dismissed on discriminatory grounds, such as being pregnant or they were dismissed for exercising a workplace right such as making a claim for unpaid wages).
The General Protections provisions under the Fair Work Act are linked to an increasing number of claims arising from employment termination as there is no minimum period of employment required to claim. Other reasons why an employee may pursue a General Protections Claim include:
- Uncapped damages, although there is still a time limit for lodging a claim
- Applications being open to prospective and current employees as well as contractors and other workers
- A broader scope, including injunctions
- The reverse onus of proof; the employer is required to prove that they did not dismiss for an unlawful reason
It is this final reason that causes the largest cost and inconvenience for the employer as it is the employer who must provide evidence that excludes the possibility that the termination occurred because they exercised a workplace right and was discriminated against because of their actions.
So, if reasons for dismissal are not provided to the employee, this leaves the door open for the dismissed employee to “manufacture” unlawful reasons for the dismissal. Giving the employee a clear-cut reason for dismissal based on objective criteria with supporting documentation of the employee’s poor performance will be required in any court case brought by the employee and can go a long way towards discouraging a General Protections Claim due to the cost of legal representation of the employee and the likelihood of the case being found in the employer’s favour.
Therefore, we highly recommend providing any employee with a reason or reasons for their dismissal with performance management documents to back up those reasons. For expert advice on mitigating your risk of an employee bringing a General Protections Claim against you, contact us.
Greg Arnold – Director & Principal Consultant
Disclaimer: This article provides a summary only of the subject matter without the assumption of a duty of care by Effective Workplace Solutions. No person should rely on the contents as a substitute for legal of other professional advice.