A dismissed employee may apply to the Fair Work Commission
("the Commission") for an unfair dismissal remedy arguing
that the termination was harsh, unjust or unreasonable. Although
the employer may have a valid reason for termination, the
Commission may still order compensation for a dismissed employee
because the employer did not follow a fair process when making a
decision to terminate.
What does this mean for your business?
Business should ensure that they follow a fair process when
making a decision to terminate. This could, for example,
Providing the employee an opportunity to respond to the
allegations of misconduct or poor performance;
Allowing the employee to have a support person at any meetings
discussing misconduct or poor performance;
Advising employees of outcomes of investigations into
allegations of misconduct so far as they involve the employee;
Giving employees an opportunity to show cause why their
employment should not be terminated prior to a final decision being
made by the business.
A recent case highlights the importance of following a thorough
procedure prior to terminating an employee for misconduct.
George Szentpaly v Basin Sands Logistics Pty
Ltd  FWC 4213
In this case, Mr Szentpaly was employed by Basin Sands Logistics
(BSL) to perform work under a labour hire
arrangement with Bemax Resources Pty Ltd (Bemax),
primarily driving a loader. On 7 February 2013 Mr Szentpaly
commenced his rostered 12 hour night shift at Bemax's mine
site. After carting loads to various stockpiles he said he found
the hydraulic ride control on the loader was not operating
correctly, causing the bucket to drop without warning. He turned
the ride control off which then made the ride very bumpy. He said
this problem was exacerbated by the air inflated driver's seat
in the loader gradually deflating every 15 to 20 minutes.
After documenting the issue following proper safety procedures Mr
Szentpaly stopped work and returned to the crib room. This occurred
only 5½ hours into his shift and he remained in the crib
room for the next 6½ hours.
The following evening, Mr Szentpaly was asked by a Bemax manager
why so few loads had been carted the previous night. Mr Szentpaly
explained the situation and when questioned by the manager why he
had not reported the problem he explained that he had assumed Bemax
was aware of the safety concerns as it had been documented a few
BSL subsequently terminated Mr Szentpaly's employment
stating: "You have failed to meet specific goals and targets
and therefore Basin Sands Logistics Management issue you with this
Employment Termination Letter with immediate effect." Mr
Szentpaly had previously received a warning concerning a
Although Commissioner Gregory found that BSL may well have had a
valid reason to dismiss Mr Szentpaly, BSL had not given Mr
Szentpaly reasonable opportunity to respond to the allegations and
that the questioning by the Bemax manager was not enough for BSL to
rely on in making a decision to terminate. Further, while BSL had
not denied Mr Szentpaly a support person, there was no discussion
about the opportunity to have a support person. BSL had a dedicated
HR professional and so lack of knowledge of the procedure on the
part of the Company could not be an excuse.
While BSL had a valid reason to terminate Mr Szentpaly's
employment they had fallen down on the process with a lack of
procedural fairness and ultimately, Mr Szentpaly was unfairly
dismissed. BSL was ordered to pay Mr Szentpaly $7,769.41 in
compensation for the unfairness that arose from the dismissal.
To avoid a finding by the Commission in an application for
Unfair Dismissal Remedy that a termination was harsh, unjust or
unreasonable, an employer needs to not only have a valid reason for
the termination of employment, but also have afforded the employee
procedural fairness in relation to the termination. Otherwise the
employer is at risk of an order for reinstatement or payment of
compensation for an unfairness that arose from the termination of
The content of this article is intended to provide a general
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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