Unlawful Dismissal

Unlawful dismissal occurs when an employee is sacked for a prohibited reason. Those reasons are listed in the Fair Work Act 2009, with disputes about unlawful dismissal handled by the Fair Work Commission (FWC).

Unlawful dismissal is different to unfair dismissal which is when the dismissal is harsh, unjust or unreasonable.

What is unlawful dismissal?

Section 772 of the Act states an employer must not terminate a person’s employment for one or more of the following reasons:

• temporary absence from work due to illness or injury;
• trade union membership or participation in trade union activities;
• non-membership of a trade union;
• seeking office as or being an employee representative;
• making a complaint against an employer;
• race, colour, sex, sexual orientation, age, physical or mental disability, marital status, family or carer responsibilities, pregnancy, religion, political opinion, national extraction or social origin;
• maternity leave or other parental leave;
• temporary absence from work to volunteer in an emergency.

A claim for unlawful dismissal places the onus of proof on the employer to show the termination was not for one of the prohibited reasons.

Illness or injury

“Temporary” in the context of illness or injury means 3 months or an aggregation of 3 months in a 1-year period. An employer may be justified in terminating a person’s employment because illness or injury mean the person can no longer perform the inherent requirements of the position.

Trade union factors

This reason includes joining or not joining a union, taking part or not taking part in strike action, and representing or promoting the views, claims or interests of a union.

Making a complaint

This reason includes a complaint about anything connected to the person’s employment, such as bullying, unsafe work conditions or treatment from supervisors. It also covers filing or intending to file a workers’ compensation claim or a complaint with any statutory body such as the Fair Work Commission, Fair Work Ombudsman, Australian Taxation Office or WorkSafe.

Discrimination against those with certain characteristics

The Act lists a range of characteristics on which it is unlawful to discriminate, such as race and sex. Discrimination of this kind is also prohibited in national anti-discrimination legislation including the Racial Discrimination Act 1975 and the Sex Discrimination Act 1984.

Who is covered?

An employee can make an unlawful dismissal claim if they are not covered by the national workplace relations laws and are not eligible to make a general protections application. Employees not covered by the national laws include state government and local government employees in New South Wales, Queensland and Western Australia.

Most employees are protected from unlawful dismissal under the general protections laws in the Fair Work Act. General protections aim to:

• protect workplace rights;
• protect freedom of association;
• protect against workplace discrimination;
• provide relief for those who have been discriminated against, victimised or experienced other unfair treatment.

An employer must not take any “adverse action”, such as dismissal, against an employee because the employee has a workplace right, has exercised that right or proposes to exercise it.

Dispute process

An application to the FWC to resolve an unlawful dismissal dispute must be made within 21 days. The FWC can extend that period if there are exceptional circumstances, taking into account factors such as any action taken by the person to dispute the dismissal and prejudice to the employer.

The FWC must hold a conference to deal with dispute. If the FWC is satisfied a settlement cannot be reached, it must issue a certificate stating this. Once a certificate has been issued, the parties can agree to formal arbitration by the FWC. The FWC can then order:

• reinstatement;
• continuity (as if the dismissal did not happen);
• payment or wages or entitlements lost;
• compensation (which has no cap for unlawful dismissal);
• a statement of service to the employee’s continuous service with the employer is maintained.

The FWC can also dismiss the application.

If the parties do not agree to arbitration, a party can apply within 14 days to either the Federal Circuit Court or the Federal Court to deal with the dispute.

The court can:

• issue a fine;
• order reinstatement;
• award compensation;
• grant and injunction;
• award costs.

The employee can also decide not to pursue the claim further and formally discontinue the matter.

For advice or representation in any legal matter, please contact Armstrong Legal.