New Changes to Unfair Dismissal Laws

22 December 2008

An unfair dismissal refers to a claim by an employee whose employment has been terminated unfairly. That is, the employee was not afforded procedural fairness and there was no valid reason for termination.

Changes to unfair dismissal:

One of the core pre-election promises of the Labor Party during last year’s election campaign was to make the WorkChoices Act fairer, and also to scrap the unfair dismissal laws. The Rudd Government’s industrial relations bill was introduced to Parliament in November 2008.

What will change?

The changes can be summarised as follows:

Businesses who employ between 16 and 100 employees, will again be open to claims from employees that they have been unfairly dismissed. Employees cannot lodge an unfair dismissal claim within the first 6 months of their employment.
Employees of a small business employer (15 employees or less) cannot lodge unfair dismissal claims unless they have been employed for a minimum of 12 months. Each full time, part time and casual employee will count as one employee.
Where a genuine redundancy exists, dismissing an employee will not constitute unfair dismissal. This replaces the exception in the current legislation which relates to “genuine operational reasons”.

It’s expected that the changes to unfair dismissal laws will come into force on 1 July 2009. Of course, the Opposition has not confirmed that they will accept these changes, and allow passage of the Bill in its current form through the Senate – so watch this space.

Fair Work Australia, as the new industrial umpire, is designed to ensure a faster, less complex and less costly resolution of unfair dismissal claims for both employers and employees. Whether this will be the case remains to be seen – the “devil is in the detail”, especially for small businesses. Balancing the rights of employees and employers remains a politically charged issue.

In any event, it is important that employers familiarise themselves with the new laws and, when the Bill is passed, incorporate the new requirements in their human resources policies and procedures.

Click here for a more detailed version of this article.

New Changes to Unfair Dismissal Laws by Holley Nethercote Commercial Lawyers is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 2.5 Australia Licence.