Performance issues valid reason for termination, though
summary dismissal harsh and unjust
Adam Ramsay (previously known as Adam Attia) was employed by AVA
as an IT professional from August 2008, on terms described in a
common law employment contract drafted by a HR consultant with
The applicant's employment was terminated on 26 February
2010 for alleged "gross incompetence".
The termination letter described the basis of the termination to
"... lack of willingness to
learn the product and related topics and therefore not improving
the ability in resolving problems and issues in time and in
accordance with the specifications and / or business requirements
and company's procedures".
It was the respondent's contention that the applicant's
alleged performance failures amounted to serious misconduct as
provided for in the contract as a basis for summary dismissal.
The applicant denied all allegations made against him and
maintained that his employment was unfairly terminated. He sought
reinstatement to his former position and compensation for lost
The Small Business Dismissal Code applied. The Code provides
Summary dismissal – without notice or warning when
the employer believes on reasonable grounds that the employee's
conduct is sufficiently serious to justify immediate dismissal.
Serious misconduct includes theft, fraud, violence and serious
breaches of occupational health and safety procedures.
For a dismissal to be deemed fair it is sufficient, though not
essential, that an allegation (with reasonable grounds) of theft,
fraud or violence be reported to the police
Other dismissal – in other cases, the small business
employer must give the employee a reason why he or she is at risk
of being dismissed. The reason must be a valid reason based on the
employee's conduct or capacity to do the job. The employee must
be warned verbally or preferably in writing, that he or she risks
being dismissed if there is no improvement. The small business
employer must provide the employee with an opportunity to respond
to the warning and give the employee a reasonable chance to rectify
the problem, having regard to the employee's response.
Rectifying the problem might involve the employer providing
additional training and ensuring the employee knows the
employer's job expectations.
It was noted that the applicant was often late for work.
Various performance issues requiring vast improvement were
raised in a performance appraisal on 25 November 2009. Although his
punctuality improved in the short term, the issues largely
remained. The applicant was advised on three occasions that he was
still not meeting expectations, during January and February
In terminating Mr Ramsay's employment summarily, AVA relied
on the terms of its employment contract with him. At clause 14
(Termination of Employment), the contract provided for four weeks
notice on termination, except if there was a breach of the
agreement, a wilful failure to properly discharge any duties, or
Circumstances which may amount to serious misconduct were
described as including dishonesty, gross misconduct, gross
incompetence and wilful neglect of duty.
Commissioner Roberts found that the respondent complied with the
Code by warning the applicant that his performance was an issue,
and the applicant had adequate opportunity to respond to the
warnings and rectify the problems.
The applicant's performance and conduct were found to amount
to a valid reason for the termination of his employment.
However, the Commissioner was unable to determine, on the
available material, that there was conduct justifying summary
dismissal. As such, the summary dismissal was found to have been
harsh and unjust.
Reinstatement was not considered an appropriate remedy. Instead,
the applicant was awarded an amount equal to four weeks wages, in
lieu of the notice he should have received under the contract, when
his employment was terminated.
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guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Long experience representing many of Australia's leading employers has taught us that in employment litigation the identity of an employee's representative is a major factor in how employee litigation runs.
Australian employees receive certain entitlements (such as annual leave and superannuation) where contractors do not.
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