The Fair Work Commission recently released its 2019-20 annual report, showing a significant spike in the number of unfair dismissal claims.
The report shows the FWC received over 16,558 unfair dismissal claims – a spike of more 2,600 claims compared to the previous year (13,928).
Unfair dismissals accounted for almost half of the FWC’s caseload.
Fair Work Commission President, Justice Iain Ross AO, said 2019–20 has been a busy and challenging year for the Commission, as it has been for the Australian community generally.
“The COVID‑19 pandemic has affected many aspects of our lives and has brought significant changes to workplaces and the economy,” he said.
Australian Small Business and Family Enterprise Ombudsman Kate Carnell said the COVID-19 crisis played a role in the latest figures, however pointed to the number of claims consistently remaining at unacceptably high levels in recent years as further proof the Small Business Fair Dismissal Code is not working in the way it was originally intended.
“It shines a light on underlying systemic issues that my office has consistently raised for years, culminating in the release of our comprehensive review of the Small Business Fair Dismissal Code in August 2019,” she said.
“To date, my office has had no formal response from the Federal Government regarding our review and the Attorney General’s promised discussion paper has not yet materialised.
“When the Small Business Fair Dismissal Code came into effect in 2009 under the Labor Government, it was in recognition small business owners do not have the time, money or expertise to navigate the overly complex unfair dismissal system.
“However the high number of unfair dismissal claims lodged with the Fair Work Commission is a clear indication that too many small businesses are being pulled into costly and time-consuming unfair dismissal hearings.”
Balance needed on unfair dismissal: AREEA
Restoring balance to the unfair dismissal laws is one of AREEA’s key reform priorities for the 46th Parliament as highlighted in its Pathway to Productivity campaign.
Under the FW Act employers are not able to dismiss employees for serious misconduct without fear of them seeking compensation and / or winning their jobs back. This has seen ludicrous outcomes at the FWC where employees dismissed for serious misconduct have been reinstated and / or awarded compensation.
Employers are increasingly exposed to unfair dismissal matters before the FWC despite having to conduct often lengthy investigations prior to making a decision to dismiss an employee.
There should be no question of reinstatement where an employee is terminated for serious misconduct.
Where a business has made the decision to terminate an individual’s employment based on the facts and circumstances at hand in the wake of serious misconduct that decision should stand. The FWC should not substitute its own decision for that of the employer. The ability for an employer to take action to maintain a safe and healthy work environment for all employees is critically important, including for example after operating heavy machinery whilst under the influence of drugs, or for proven allegations of sexual harassment or violence in the workplace.
Specifically, AREEA believes the Fair Work Act’s unfair dismissal provisions should be amended to:
- Exempt terminations for serious offences and misconduct from contesting dismissal.
- Provide that where a valid reason for termination exists, the termination should stand.
- Ensure each unfair dismissal application is determined on its merits only, not influenced by employee circumstances (such as age, length of service, personal circumstances etc.).
- Preclude workers earning above a high income threshold from unfair dismissal claims.
- Increase application and hearing fees.
For more information about AREEA’s campaign to amend Australia’s workplace laws, contact AREEA’s policy team via [email protected].
