What counts as unfair dismissal in Australia
The Fair Work Commission's own three-part test for unfair dismissal, and the two other bars, small business process and genuine redundancy, that sit alongside it.
The Fair Work Commission has one legal test for unfair dismissal, and it has three parts that must all be true. Under section 385 of the Fair Work Act 2009, a dismissal is unfair if it was harsh, unjust or unreasonable, and it was not consistent with the Small Business Fair Dismissal Code where the employer is a small business, and it was not a case of genuine redundancy. Fail any one of the three, and there is no unfair dismissal remedy, whatever else is true about how the dismissal was handled.
The purpose behind the test
The Fair Work Commission states the objects of the unfair dismissal provisions in these terms: to establish a framework that balances the needs of business, including small business, and the needs of employees, to set up procedures that are quick, flexible and informal, and to provide remedies where a dismissal is found to be unfair. The Act calls the underlying principle a "fair go all round," a phrase the Commission traces to a 1971 industrial relations decision and applies to both sides of the case, not just the dismissed employee.
The two bars that sit outside "harsh, unjust or unreasonable"
A dismissal that is a genuine redundancy cannot be an unfair dismissal at all. The Commission has to be satisfied the employer no longer needed the job done by anyone because of a genuine operational change, that it met any award or agreement obligation to consult, and that redeployment within the employer's enterprise, or an associated entity, was not reasonably available. If all three hold, the case cannot proceed as an unfair dismissal claim regardless of how considerate or otherwise the process was.
Where the employer is a small business, defined as fewer than 15 employees, the dismissal is instead measured against the Small Business Fair Dismissal Code. This site has not read the Code's own text and does not describe its specific steps; what can be said is that it exists, is published separately by the Fair Work Ombudsman, and that small business employers are expected to follow it.
What "harsh, unjust or unreasonable" actually looks at
This is the branch most cases turn on, and the Commission breaks it into factors set out in section 387: whether there was a valid reason connected to the employee's capacity or conduct, whether the employee was notified of that reason before the decision to dismiss was made, whether they had a genuine opportunity to respond, whether an employer unreasonably refused a request for a support person, whether the employee was warned about unsatisfactory performance before being dismissed for it, and how the size of the employer and its access to dedicated human resources expertise affected the process it was able to follow.
Where this came from
- Fair Work Commission: Overview of unfair dismissal.
- Fair Work Commission: What is a genuine redundancy?.