WORKCHOICES – the Changes to Termination of Employment
by Frances Anderson, Senior Lawyer, Moores Legal

One of the main areas of change under the WorkChoices legislation concerns termination of employment. In this article, we review some of these changes and their implications for employers.

Unfair Dismissal Under WorkChoices

Qualifying period
No claim for unfair dismissal can be brought unless an employee has completed a qualifying period of 6 months (or less if agreed before employment commences).

100 employees or less
No claim for unfair dismissal can be made if the employer, at the time of termination, employed 100 employees or less, including all full-time, part-time and casual staff engaged on a regular and systematic basis for a period (or a sequence of periods) of at least 12 months.

Termination for operational reasons
No claim for unfair dismissal can be made against any employer, irrespective of the size of their workforce, if the employee’s employment was terminated for genuine operational reasons.

Unlawful Termination

Protection against unlawful termination under s170CK will remain under WorkChoices (e.g. where employment has been terminated for reasons to do with a temporary absence from work because of illness or injury, trade union membership, race or another ground of discrimination).

Commission Procedures

If a claim for unfair dismissal is brought under WorkChoices and the employer wishes to move for the dismissal of the matter because:

• there is no jurisdiction;
• the application is frivolous, vexatious or lacking in substance; or
• the application is out of time (i.e. after the 21 day time limit)

Remedies

If reinstatement is inappropriate and compensation is ordered, WorkChoices requires the Commission to consider whether any misconduct by the employee may have contributed to the employer’s decision to terminate the employee’s employment. If the Commission finds that the employee’s misconduct did contribute to the termination, WorkChoices requires the Commission to reduce the amount to be paid to the employee by an appropriate amount.

WorkChoices also provides that no payments may be made in respect of any shock, distress or humiliation caused to the employee by the manner of termination.

Redundancy of 15 or More

Currently, if an employer, prior to terminating the employment of 15 or more employees for operational reasons, fails to consult with the trade unions of which any of the employees was a member, the Commission can make any orders it considers appropriate. WorkChoices restricts these orders so as to exclude any orders for reinstatement, payment of compensation, payment of severance pay or the disclosure of confidential, commercially sensitive or personal information.

Costs

WorkChoices supplements the existing opportunities for obtaining costs so that in all applications for relief for termination of employment, costs orders can be made against representatives as well as against litigants.

Implications for Employers

WorkChoices should make it easier for employers of less than 100 employees to terminate an employee’s employment for reasons relating to capacity and conduct, and for all employers, irrespective of the size of their workforce, to terminate for genuine operational reasons. The procedures enabling the Commission to dispose of a case on the papers should also expedite matters. However, employers should be aware that although WorkChoices may remove some options for redress, an aggrieved employee may try to contest his/her dismissal via other means, eg through anti-discrimination legislation, the Trade Practices Act or the common law.

Frances Anderson is a senior lawyer with Moores Legal fanderson@moorelegal.com.au