Termination of Employment

Terminating someone’s employment is a regrettable yet necessary part of running a business. Under the old system it was often an expensive and risky activity exposing somebody to the possibility of a claim for unfair dismissal.

It is generally recognized that the unfair dismissal provisions in the previous legislation was entirely out of control as almost anyone could mount an action against a previous employer for unfair dismissal in either the NSWIRC or the AIRC. The result was that employers simply did not take on any additional staff and risk exposing themselves to unfair dismissal.

WorkChoices is designed to solve this problem by limiting which employees can pursue a remedy for unfair dismissal. Under these changes the AIRC will immediately dismiss an application for unfair dismissal if:

• That the applicant (the terminated employee) has worked for the respondent (employer) for less than 6 months (time limit exception).
• That the applicant had only worked for the respondent for a period reasonably specified to be a probationary period under their contract of employment (usually under 3 months).
• That the applicant was engaged under a contract of service only to perform a specified task
• That the applicant’s employment was terminated for genuine operational reasons (redundancy exception).
• That the applicant was a casual employee employed for less than 12 months.
• That the applicant employee was not on an award and earned over $94,900 per year.
• That the respondent company has less than a 100 employees (small and medium sized business exception).
• That the applicant was only engaged by the employer on a seasonal basis.

Moreover, the NSWIRC will no longer have jurisdiction to hear any unfair dismissal claims or any actions for unfair contracts.

However, this does not mean that an employer can dismiss an employee for any reason. It is still illegal to dismiss an employee on grounds of, or for any reasons which include race, nationality, gender, membership or non membership of a union, religion, illness and cooperation in another party’s claim for unfair dismissal.