Unlawful termination and unfair dismissal both describe a scenario whereby an employee of a business has reasonable cause to challenge the basis for being fired or “let go”, either on an ethical or legal basis. For an employee whose employment has been terminated, it is difficult without legal advice to know which of these legal doctrines will apply. The legal application can often be misunderstood and deserves some clarification.

The most appropriate legal practitioner to explain these two terms is an employment lawyer, since both relate to the area of employment law. To gain a more legally comprehensive understanding of the application of these terms, we should look at the relevant provisions of the Fair Work Act 2009 (‘the Act’).

What does the Act say about ‘unfair dismissal’?

Located in part 3-2 of the Act, the unfair dismissal provisions attempt to formulate a guided framework that is fair on both parties – employer and employee. The procedures set out in the Act for commencing a claim for unfair dismissal against an employer are typically carried out quickly, flexibly and informally. Their purpose is to give each party “a fair go”.[1]

  • What does ‘unfair dismissal’ mean?

Section 385 of the Act looks at the circumstances of the dismissal to determine whether or not it was unfair. The Courts may take into account any of the following factors relating to the conduct of the employer when deciding on a claim for “unfair dismissal”:

o   The harshness, unfairness or unreasonableness of the dismissal;

o   Whether or not the decision to dismiss was consistent with the regulations under the Small Business Fair Dismissal Code; and

o   Whether or not the dismissal was based on actual redundancy.

  • How to prevent being unfairly dismissed

Apart from independent contractors, employees who have worked a minimum of 6 months have entitlements to challenge a dismissal that they believe to be unfair. If the employee was working in a small business, however, the minimum will be one year.

In addition, for an employee to challenge a dismissal they must satisfy one of the following requirements under section 382(b) of the Act, including:

o   Being employed under an applicable enterprise agreement;

o   Being covered by an award; or

o   The employee earns less than the high-income threshold under the Fair Work Regulations 2009. 

What does the Act say about ‘unlawful termination’?

There is a common misconception surrounding the terms ‘unfair dismissal’ and ‘unlawful termination’, being that they share the same meaning. In fact, the Act deals with these concepts separately. Unlawful termination is dealt with under provision 6-4 of the Act.

How can employees protect themselves?

Under provision 3-1 of the Act, employees are entitled to certain remedies in the event that they are terminated unlawfully. This might be based on discrimination or other unlawful grounds.

In addition, and under section 340 (Protections), a person is not allowed to take ‘adverse action’ against another person if the person:

  • Has a workplace right; or
  • Has, or has not, exercised a workplace right; or
  • Proposes, or proposes not to, or has at any time proposed or proposed not to, exercise a right; or
  • Prevented another person from exercising a workplace right.


If you believe you have been unfairly dismissed or unlawfully terminated, and wish to discuss the matter in more detail with an employment lawyer, contact LegalVision on 1300 544 755 and we can certainly assist.

Our team of employment lawyers are experienced in the areas of unfair dismissal and unlawful termination, and will help resolve your matter in a timely and professional manner.

[1] Sheldon J in Re Loty and Holloway v Australian Workers’ Union [1971] AR (NSW) 95.


Emma Jervis
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