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Fair Work in plain English: Small Business Fair Dismissal Code

Fair Work in plain English: Small Business Fair Dismissal Code

When it comes to knowing your rights and obligations, the Fair Work website is an invaluable resource for business owners and their employees. In this article we explore the Small Business Fair Dismissal Code and highlight some of its key parts.

What does the Code cover?

In basic terms, the Fair Work Australia Unfair Dismissal code relates to two types of dismissal: summary and other. Summary dismissal refers to employment being ended immediately and without warning. This can happen when the employer believes that the employee has engaged in serious misconduct, such as theft, vandalism, violence or serious breaches of occupational health-and-safety rules. It must be done on reasonable grounds and to be deemed fair, it is usually (but not always) accompanied by a police report.

Other types of dismissal are generally due to poor on-the-job performance, and must come with a prior warning – verbal or written – that the employee risks dismissal if their performance doesn’t improve. The warning must come with fair opportunity for the employee to fix the problem beforehand, which might involve the employer providing training or ensuring the worker understands their job expectations.

How can employers ensure they have followed the Code?

A key resource provided by the Australian Government is the Small Business Fair Dismissal Code Checklist, which employers must complete to ensure that the dismissal falls within the boundaries of the Code. Questions include total number of employees (which must be less than 15 for the Code to apply); how long the staff member has been employed; and whether the dismissal can be considered a redundancy due to operational changes in the business, and therefore possibly subject to an award or enterprise agreement.

Understanding the employee’s rights

In addition to a completed checklist, the employer must also be able to provide evidence that fair warning was provided prior to dismissal, if it was non-summary. Evidence can include copies of written warnings, statement of termination and signed witness statements. During employee-manager discussions where dismissal is possible, the employee can have another person present to assist, as long as he/she is not a lawyer acting in a professional manner.

Letting an employee go is never a pleasant experience and being hit with an unfair dismissal lawsuit can be devastating to the small business owner – both financially and to your reputation. That’s why a good understanding of the Fair Dismissal Code is absolutely essential to stay apprised of your rights and responsibilities.

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