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Unfair Dismissal & The Requirement To Provide Procedural Fairness

Case study

It’s well known that in order to lawfully terminate an employee’s employment, the employer must ensure that (a) there is a valid reason connected to the employee’s performance or conduct; and (b) the process adopted to terminate the employment was in all respects, procedurally fair.

Despite this, employers frequently find themselves in a cloud of uncertainty when trying to wade their way through the requirements of procedural fairness. In a recent case decided in the Fair Work Commission on 22 November 2016, an employer found themselves in this exact situation. While a valid reason to terminate the employee’s employment existed, the employer’s confused approach to procedural fairness came at a cost – a successful unfair dismissal application.

Case in review

In the recent case of Malcolm Bigg v NORTEC Employment and Training Limited, the employee’s performance and conduct had been under scrutiny for various reasons over a period of 4 years. The issues included a failure to follow company protocol, complaints about inappropriate behaviour, allegations of sexual harassment, improper use of travel allowances, as well as directing other staff to perform duties without permission. There was ample reason to discipline the employee and indeed, grounds seemingly existed to terminate the employee much sooner than when it ultimately was.

Unfortunately, the employer’s understanding and response to these performance and conduct issues was somewhat confused. The employee had received three final written warnings in respect to the concerns in question. On each occasion, he had been properly notified of the concerns and provided with an opportunity to respond.

Surprisingly however, when another relatively minor performance issue arose in April 2016, the employer decided that they would dismiss the employee on the basis of a cumulative assessment of the performance issues over the 4-year period, without providing the employee with an opportunity to respond. The failure to provide the employee with an opportunity to be heard in respect of the array of performance and conduct issues relied on, meant the employee was denied natural justice.

Commissioner Cambridge therefore determined the dismissal was harsh, unjust and unreasonable, in contravention of the provisions of the Fair Work Act 2009, and awarded compensation accordingly.

The importance of “show cause”

In considering the employer’s failure to properly discharge its statutory obligations to provide procedural fairness, Commissioner Cambridge commented that the employer should have held a “show cause” meeting with the employee, so as to enable the employee to respond and put his case forward.

Commissioner Cambridge stated “…any disciplinary procedures should mandate the opportunity for an employee to be provided with a “show cause” meeting with the relevant decision-maker before the determination of any dismissal from employment.

Interestingly, the employer in this case had dedicated employee relations management specialists and still failed to properly understand their obligations under the Fair Work Act 2009. Perhaps even more surprising is the fact that the employer had initially engaged in an extensive, detailed and somewhat lenient disciplinary process, only to forget all about process when it counted most. The employer’s failure to provide the employee with a ‘show cause’ opportunity resulted in a finding that the employee had been unfairly dismissed.

Lessons to be learned

This recent case serves as a timely reminder for employers. It’s crucial that employers understand their obligations with respect to performance management and disciplinary processes, and they seek legal advice before pulling the pin and terminating someone’s employment.

The case is also useful for employees who find themselves in a similar situation where they have not been offered a show cause process prior to their employment being terminated.

It’s better to be safe than sorry. If you are unsure of your obligations or entitlements, you need to obtain legal advice. Being proactive will save a lot of headaches and costs! To know your rights, contact our Employment Lawyers today.

For Residents of New South Wales please contact our Sydney Office on 02 9358 5822

For Residents of Queensland please contact our Gold Coast Office on 07 5593 0277

Article by Nikolina Palasrinne