As an employer, you should know that your permanent employees can make unfair dismissal claims. They may do this where you have terminated their employment and they think it is harsh, unjust or unreasonable. For instance, permanent employees who you have employed for at least six or 12 months can make a claim. However, what is less clear is whether your casual employees can make a claim for unfair dismissal. This article outlines:
- what an unfair dismissal claim is; and
- how your casual employees might be able to make this claim.
What Is an Unfair Dismissal Claim?
An employee can apply for reinstatement or compensation where they believe an employer has unfairly terminated them. This is an unfair dismissal claim that goes to the Fair Work Commission. For instance, an employee’s termination may be unfair if it was harsh, unjust or unreasonable.
Eligibility Criteria
Additionally, the employee must also meet the eligibility criteria. They must:
- lodge their application within 21 days of the dismissal;
- be covered by the national workplace relations system; and
- meet the eligibility criteria (including the minimum qualifying period).
Who Is Eligible to Make an Unfair Dismissal Claim?
One of the eligibility requirements is that your employee must have been employed for at least six months before they can apply for unfair dismissal. However, if you run a small business, the requirement is raised to 12 months. A small business is a business with fewer than 15 employees at the time you dismissed the employee.
Therefore, for small businesses, there are slightly different rules for dismissal. The Small Business Fair Dismissal Code sets out these rules. In order to figure out whether your business is a small business, you will need to count all the employees employed at the time of dismissal, including:
- the employee and other employees you are dismissing at that time;
- regular and systematic casual employees employed by the business at the time (not all casual employees); and
- employees of associated entities (including those not based in Australia).
Other eligibility requirements include the employee’s remuneration. Thus, the employee’s remuneration must be below the high-income threshold of $167,500 as of 1 July 2023.
As an employer, understand your essential employment obligations with this free LegalVision factsheet.
Are Casual Employees Eligible to Make an Unfair Dismissal Claim?
Casual employees can only access an unfair dismissal remedy if their employment is:
- regular and systematic; and
- there is a reasonable expectation of ongoing employment.
Therefore, the Fair Work Commission will make an objective consideration of the type and frequency of the work carried out by the casual employee. For instance, this includes whether regular offers of work were:
- made to the employee during a time where they had indicated their general availability;
- accepted by the employee and not occasional;
- contingent on another factor, like another employee being sick or otherwise unavailable.
Thus, if your casual employee makes an unfair dismissal claim, the Fair Work Commission will review the pattern of work.
Therefore, having regard to the actual pattern of work, the Fair Work Commission may determine that the casual employee can make a claim. However, the Fair Work Commission would also need to be content with the other eligibility criteria. For instance, they would need to be content that they were ‘dismissed’ and had served the minimum qualifying period.
What Should I Do if I Plan to Terminate a Casual Employee?
To avoid an unfair dismissal claim, there are a few precautions you can take. In particular, when you are terminating a casual employee, you should provide them with:
- notice;
- a valid reason for their termination;
- time to respond; and
- permission to bring a support person to the dismissal/termination discussions.
These steps are not legal requirements. However, taking pre-emptive action to ensure your dismissal is valid can protect you against an adverse finding in an unfair dismissal claim.
Key Takeaways
Terminating employees can be a difficult and complex process, especially if you are planning to dismiss a casual employee. Notably, you may be liable for an unfair dismissal claim if your termination is found to be unreasonable, harsh or unjust. As a result, you should first examine your casual employee’s pattern of work before terminating them. You can then determine whether they are able to make an unfair dismissal claim if you abruptly end their employment. Despite these claims not being available to every employee, you should still aim to adopt proper practices and precautions when terminating to avoid your actions being labelled unfair.
If you have any questions regarding the termination of a casual employee, our experienced employment lawyers can assist as part of our LegalVision membership. You will have unlimited access to lawyers to answer your questions and draft and review your documents for a low monthly fee. Call us today on 1300 544 755 or visit our membership page.
Frequently Asked Questions
An unfair dismissal claim is an application for reinstatement or compensation for an employee who thinks they were unfairly terminated. The Fair Work Commission then decides if the employee was terminated harshly, unjustly, or unreasonably.
Usually, casual employees can only access an unfair dismissal remedy if their employment was regular and systematic, and they had a reasonable expectation of ongoing employment.
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