Summary dismissal refers to instant dismissal or dismissal without notice. This is probably the harshest form of discipline that can be imposed by an employer. As such, you should exercise caution when seeking to summarily dismiss an employee for engaging in serious misconduct. This article discusses the:

  • types of misconduct that may warrant summary dismissal; and
  • recommended process for dismissal in these circumstances.

What is Serious Misconduct?

Serious misconduct includes willful or deliberate behaviour by an employee that causes serious and imminent risk to the:

  • health and safety of a person; or
  • reputation, viability or profitability of your business.

Depending on the circumstances, conduct such as theft, fraud, assault and intoxication at work may be considered serious misconduct. However, you should be cautious when proceeding with summary dismissal, as each case will turn on its own facts. This means that actions which amount to serious misconduct in one case may not amount to serious misconduct in all circumstances. 

Risk of a Claim for Unfair Dismissal

One of the primary risks of summarily dismissing an employee is that they may bring an unfair dismissal claim against your business. That is, your employee may argue that their dismissal was harsh, unjust or unreasonable in the circumstances. 

For example, if you summarily dismiss an employee for serious misconduct, they may argue that dismissal was a disproportionate response to their actions. This is possible even if you had a reason for the dismissal, where they can establish that your reaction was overly harsh.

When considering whether an dismissal was unfair, the Fair Work Commission (FWC) will have regard to whether:

  • there was a valid reason for the employee’s dismissal; and
  • you granted the employee procedural fairness.

This means that even when you have the right to dismiss an employee summarily under the circumstances, you must still treat them fairly throughout the dismissal process. This requires you to:

  • specify the alleged conduct to the employee;
  • give them an opportunity to respond; and
  • genuinely consider their response and justification.

Failure to provide procedural fairness is considered by the FWC to be a serious defect in procedure. This could render the dismissal unfair and expose you to the risk of a claim for unfair dismissal.

Other Legal Risks of Summary Dismissal

If you dismiss an employee summarily, you may also be at risk of a claim in:

  • general protections;
  • discrimination; or
  • breach of contract.

General Protections Claim

general protections application requires your employee to establish that adverse action was taken against them because: 

  • of a protected attribute; or
  • they exercised or proposed to exercise a workplace right.

Your employees’ protected attributes refer to their personal qualities that do not affect their performance, such as race, gender or age. On the other hand, their workplace rights include matters like taking personal leave or requesting a safe environment.

As such, your employee may also claim that the summary dismissal of their employment constitutes adverse action based on one of these grounds.

Discrimination

There is also a risk that your employee could bring a discrimination complaint against your business in the: 

Under these circumstances, they would argue a claim on the basis that they were treated less favourably or discriminated against on unlawful grounds.

Breach of Contract

If your employee can establish that their alleged misconduct was not serious enough to justify being summarily dismissed, then you may also face liability for breach of contract concerning termination of their employment.

Process for Summary Dismissal

To mitigate the risk of your former employee taking legal action against it, you must follow the proper disciplinary process for dismissal. The key steps that you need to undertake include: 

  1. establishing the facts and considering suspending your employee on full pay if the alleged conduct amounts to serious misconduct;
  2. writing to your employee outlining the allegations, as well as a date and time for a disciplinary meeting;
  3. putting them on notice that if the misconduct is proven, this may result in termination of their employment;
  4. providing your employee with advance notice of the disciplinary meeting (e.g. 24-48 hours’ notice);
  5. allowing your employee to have a support person present during the disciplinary meeting;
  6. giving your employee an opportunity to respond to the allegations of serious misconduct during the meeting, before you decide to dismiss them; and
  7. confirming that your employee will be notified of the outcome of the disciplinary meeting once the company has had the chance to consider any matters raised by the employee during the meeting.

If you believe that you can substantiate the allegations of serious misconduct after following the above process, you should: 

  • verbally advise your employee of the outcome of the disciplinary process; and
  • provide a letter confirming that they have been summarily dismissed.

Small Business Fair Dismissal Code

The Small Business Fair Dismissal Code (Code) offers small businesses a simplified dismissal process to ensure that they meet the requirements of the FWC. A small business includes any employer with fewer than 15 employees. There is also a checklist annexed to the Code, which you can use as evidence in a claim for unfair dismissal to demonstrate that you have complied with your obligations.

The Code allows small business employers to dismiss an employee without notice or warning. However, this must only occur if you believe on reasonable grounds that the employee’s conduct is sufficiently serious to warrant immediate dismissal. This includes:

  • theft;
  • fraud;
  • violence; and
  • serious breaches of occupational health and safety procedures.

As such, the threshold for serious misconduct under the Code is significantly easier for small business employers to meet than it is for employers with 15 or more employees.

Key Takeaways

Summary dismissal is the harshest form of discipline that you can impose as an employer. As such, the threshold for conduct to meet the definition of serious misconduct is incredibly difficult to meet. For this reason, you must take a step back and objectively consider whether an employee’s misconduct is serious enough to justify summary dismissal. Furthermore, even where you have a valid reason to summarily dismiss an employee, you must follow a procedurally fair process. If you would like legal advice regarding a summary dismissal, contact LegalVision’s employment lawyers on 1300 544 755 or fill out the form on this page.

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