Small businesses already have it tough enough in today’s economic climate without the myriad of workplace laws that govern employees, corporations, business and trade practices, intellectual property and taxation that add to the complexity of keeping the business afloat. Then you have to deal with human relations issues that arise at work, retention and sometimes that unfortunately includes hiring a person who was either clearly not suited for the role, or whose attitude and/or performance had eroded over a period of time. 

You feel that at the end of the day, you’re a small business and you’ve got the right to hire and fire whomever you want. You call in the employee and proceed to utter the words “You’re fired!” (think of Donald Trump in The Apprentice). Within 21 days, you receive notice of an unfair dismissal application and you begin to wonder, do I have any exposure?

This is not an uncommon scenario. If you are facing this situation (or believe that you may soon be placed in a similar situation), it may be prudent to obtain a professional opinion as to whether the conduct, behaviour, attitude, or performance in question actually warrants immediate dismissal (for cases reserved for only serious misconduct), or whether another disciplinary process ought to be followed. Having an experienced workplace relations lawyer assess the situation could save you from defending a frivolous lawsuit in a jurisdiction where costs are not usually recoverable even if you successfully defend the claim.

As a quick guide, the Small Business Fair Dismissal Code (‘Code‘) defines ‘serious misconduct‘ as “theft, fraud, violence and serious breaches of occupational health and safety procedures.” However, what if you had an employment contract in place that widened the definition of serious misconduct? Would you be able to rely on the contractual definition as previously agreed to between the parties, or are you bound by the definition in the Code? Moreover, what if the conduct sits on the line between serious and not serious misconduct? Should you err on the side of caution or would you risk breaching health and safety laws by leaving the person employed? These are all valid considerations when determining the course of action required and each case should be consulted on a case-by-case basis.

If the conduct cannot be deemed serious enough to dismiss the employee on the spot, then what procedures, disciplinary action processes, or policies do you have in place to ensure that procedural fairness and natural justice have been discharged? All employers, even Small Businesses, should be armed and equipped with processes and paperwork in place to ensure that the right course of action is followed to minimise the risk of exposure should you face a lawsuit.

The above article is not legal advice and is not specific to your needs. It is general information and we advise that you seek legal assistance to choose what is right for your personal circumstances. If you would like to talk to an experienced employment lawyer about any of the contents of this article, please feel free to contact us to make an appointment.

Daniel Le