Hutchison Ports' recent dismissal of nearly 100 of its employees by a midnight text message has made headlines around Australia. It has also sparked outrage and huge protests amongst its workforce.
This article looks at some of the issues arising from this communication style when it comes to terminating employment.
The text messages reportedly stated:
"Please check email address that payslips are sent to for a personal letter regarding a redundancy program notification.
You are not required for your allocated shift. Please disregard your most recent work order."
The email then confirmed the worker's redundancy.
While the Fair Work Commission's involvement in the matter so far, has been focused on the alleged illegality of the resulting pickets outside Hutchison's Sydney and Brisbane container terminals, the facts of the case raise questions about the general lawfulness of dismissing an employee by text message.
Section 117(1) of the Fair Work Act states that: "An employer must not terminate an employee's employment unless the employer has given the employee written notice of the day of the termination (which cannot be before the day the notice is given)."
Though the Act does not provide further details of what constitutes "written notice", in Guirguis v Ten Twelve Pty Ltd & Anor  FMCA 307 the Federal Magistrates Court held that a text message dismissing an employee, complied with the written notice requirements under the Act as a text message was a "form of writing".
Following that case, it would appear that it is possible to effectively end an employment relationship by text message.
A VALID DISMISSAL- BUT IS IT FAIR?
The more important question, however, is whether dismissing an employee by text message exposes an employer to the risk that the dismissal may be held to be unfair.
The Act provides in essence that a finding of unfair dismissal will not be available where the dismissal was a case of "genuine redundancy". The definition of "genuine redundancy" requires that:
- the employer no longer requires the employee's job to be performed by anyone because of changes in the operational requirements of the employer's enterprise
- the employer has complied with any obligation in a modern award or enterprise agreement to consult the employee about the redundancy
- it would not have been reasonable for the employee to have been redeployed in the employer's enterprise or that of "an associated entity"
It follows that in redundancy situations where an employer has complied with the above requirements the fact that the ultimate decision to dismiss was communicated by text message is unlikely to be relevant to whether the dismissal is held to be unfair.
However, a text message informing an employee that they are being made redundant without first complying with any consultation requirements in a modern award or enterprise agreement will clearly put the employer more at risk of a finding of unfair dismissal. It may also place an employer at risk of being found to be in breach of the consultation provisions of the relevant award or enterprise agreement. This can leave an employer exposed to significant fines.
It is suspected that any legal challenge to Hutchison Port's actions by the Maritime Union of Australia may include an assertion as to a breach of a relevant award or enterprise agreement although this remains to be seen.
TEXT MESSAGE DISMISSALS IN OTHER SITUATIONS
Where an employee is dismissed for a reason (other than one found to be a "genuine redundancy"), a dismissal may be held to be unfair under the Act if it is considered "harsh, unjust or unreasonable" (s 385).
The Act lists the factors that must be considered in determining whether a dismissal is harsh, unjust or unreasonable. These include:
- whether the employee was notified of the reason for their dismissal
- whether the employee was given an opportunity to respond to this reason
In Sedina Sokolovic v Modestie Fashion Australia Pty Ltd  FWA 3063 an employee terminated by text message was found to have been unfairly dismissed because, amongst other things, she was not afforded an opportunity to respond to the various issues that the employer said he was having with her conduct at work (including swapping shifts without permission).
Fair Work Australia was extremely critical of the fact that the dismissal was communicated by text message, but reading between the lines of the judgment, the primary reason for the unfairness of the dismissal seems to be the lack of a face-to-face meeting with the employee before the employer took the decision to dismiss (rather than the fact the dismissal was communicated by text message).
In Brett Martin v DecoGlaze Pty Ltd  FWA 6256 on the other hand, it was found that an employee terminated by text message was fairly dismissed, even when the text was sent without first having a face-to-face meeting. In that case, the employee's actions in failing to properly prepare paint to be applied to kitchen fittings cost the employer $74,000 to rectify.
Fair Work Australia found that there was a valid reason for communicating by text (the employee was on leave and just about to go overseas) and the gravity of the employee's mistake was so serious that even if they had had a face-to-face meeting it would not have made any difference to the decision to dismiss.
LESSONS FOR EMPLOYERS
Although it is possible to end an employment contract by text message, employers may expose themselves to the risk of findings of unfair dismissal and penalties, if they do not adequately consult with employees in redundancy situations.
Employers also expose themselves to the risk of unfair dismissal claims if they do not have face-to-face meetings with miscreant employees and allow them to defend any relevant allegations, before taking any decision to dismiss.
Although legally there may be little issue in communicating the ultimate decision to dismiss by text, employers risk damage to their reputation if communications are not handled sensitively, which, in the case of Hutchison Ports may prove even more costly.
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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.