Terminating employees for performance based issues can
be difficult for employers to navigate at the best of times. An
employer's right to terminate because of poor performance has
not been helped by a number of myths that have taken hold in this
Take for example the "3 strikes and you're out"
rule which many employers follow believing it will protect them
from unfair dismissal claims. That is simply wrong, and slavish
adherence to these "rules" often leads the employer to
overstep the mark between a reasonable dismissal and a dismissal
that is harsh and unjust, and leaves the employer exposed.
In reality, there is no one "rule" to follow when
dismissing employees, particularly where the dismissal is
performance based. The process need only be fair and reasonable in
the circumstances of each particular case.
EMPLOYMENT AND INDUSTRIAL RELATIONS LAWYER, LAURA
GERCKEN, PROVIDES THE FOLLOWING TIPS TO HELP MINIMISE YOUR RISK OF
AN UNFAIR DISMISSAL CLAIM:
Action incidents of poor performance with the employee by:
IDENTIFYING each specific manifestation of
MEETING with the employee (and any support
person requested by the employee to attend). Preferably there
should be 2 people from the employer at that meeting
TELLING the employee the conduct or
performance is not acceptable and that it will be monitored over a
specified period of time (usually at least 1 month)
WARNING that the matter is serious and that if
performance is not improved, disciplinary action may follow,
including termination of employment
ENSURING that the employee is given a WRITTEN
STATEMENT(preferably under letterhead) setting out each of the
performance issues discussed, and remedial action the employee is
expected to take, and
MONITORING the employee's ongoing
performance as the employee must be given an opportunity to improve
their performance. This is critical in any assessment of whether or
not a dismissal is "harsh, unjust or unreasonable" for
the purposes of an unfair dismissal claim.
If there is no improvement in performance or further incidents
occur, then you should again follow the procedure in respect of the
ongoing issues and any new issues that have occurred since the
first meeting with the employee. Provide the employee with a
further letter setting out each of the matters discussed at the
second meeting and give them an opportunity to respond to the
issues raised and offer a suitable plan moving forward to improve
If the employee does not provide a suitable plan and you feel
the employment relationship is no longer tenable, then you can
terminate their employment.Many variables can impact on the
The seriousness of the performance issues and the consequences
of the performance issues to both the employee and the employer
(eg. health and safety issues)
The nature of the business
The tasks performed by the employee within the business,
The length of time that the employee has been employed.
Importantly, don't rush the process, as the time provided to
employees to improve performance is often a critical factor when
assessing whether or not a dismissal is "harsh, unjust or
unreasonable". Getting the process right will minimise fall
out and help you to withstand claims for reinstatement or
compensation of up to 6 months' wages. Needless to say, if in
doubt seek advice.
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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