The Fair Work Commission (Commission) received 7686 dismissal claims in 2022 – 2023. As such, they remain a real threat to Australian employers.
What do you do when you receive an unfair dismissal claim?
So, let's look at the process from an employer's perspective after an Unfair Dismissal Claim is filed.
Once an employer receives an unfair dismissal application from the Commission, the employer must provide a formal written response within seven (7) days. This occurs by completing Form F3 (Employers Response), filed with the Commission and then served on the other side. The Form F3 response is designed to assist the Commission and the other side, in understanding the Employer's position. Whilst we recommended that the Employer's response be provided within the seven (7) day timeframe, an extension can be sought from the Commission should you require more time.
Completing Form F3 can be complex, it requires a strong understanding of the facts surrounding what has occurred, as well as an explanation as to why the dismissal was not unfair. The writer will also need a strong understanding of the law that relates to these types of claims. A lawyer can greatly assist with this process and often will strengthen an employer's position at the conciliation conference by providing a strongly drafted Form F3.
Section 386 of the Fair Work Act 2009 (Cth) (Act) outlines that an employee will be unfairly dismissed when:
- the dismissal was harsh, unjust, or unreasonable.
- the dismissal was not consistent with the Small Business Fair Dismissal Code; and
- the dismissal was not a case of genuine redundancy.
Once the Form F3 (Employer's Response) has been completed, the parties are invited to attend a conciliation conference or have the matter proceed to a hearing. We usually recommend participating in the conciliation conference, as it provides an opportunity to settle the matter before further costs are incurred.
The Conciliation Conference
Conciliation conferences occur via Microsoft Teams and are conducted by a conciliator who is a neutral third party tasked with assisting the parties to resolve the matter through negotiation. The employee (or their representative) provides an opening statement, where they detail the background to the claim and explain how they believe they have been unfairly dismissed.
The Employer (or their representative) then provides their opening statement on why the dismissal was not unfair.
From here, the parties move into a private session, where they discuss their proposed terms of settlement with the conciliator. If an agreement is reached, the settlement is recorded in either a terms of settlement or a deed of settlement and release. Any agreement will usually encapsulate the following terms:
- Any financial terms of settlement;
- Mutual release and bar to proceedings;
- Mutual confidentiality; and
- Mutual non-disparagement.
The financial terms are usually expressed as a gross amount less any applicable taxation.
A mutual release and bar to proceedings clause will record that the parties elect not to pursue each other for any further matters arising from the employment, except superannuation or workers' compensation claims.
Mutual confidentiality requires that the matter remains confidential and that neither party discloses any details to any other outside third party.
Finally, the mutual non-disparagement clause requires that neither party makes disparaging comments about the other.
What if the matter doesn't settle at conciliation?
Where the matter does not settle at the conciliation stage, the conciliator may issue a certificate stating that the matter could not be conciliated.
At this stage, the Commission can exercise its discretion to deal with the matter via a member-assisted conference. A Fair Work Commissioner is then nominated to undertake a further conference in a final attempt to settle the matter. This usually only occurs when the parties are not far apart in their final settlement offers.
Usually, the matter is set down for further directions. These directions outline the time and dates for the provision of evidence, documentation, and witnesses to be relied upon if the matter proceeds to a hearing.
Outcomes at the Fair Work Commission
The Commission details that the median compensation employees receive for an unfair dismissal claim is usually between five (5) – and seven (7) weeks of pay with less than 0.4% of applicants receiving the maximum compensation of 26 weeks' pay. In rare circumstances, the Commission may order that the employee be reinstated to their former role however, in 22/23 only 62 applicants were awarded with reinstatement.
Conclusion
Facing an unfair dismissal claim can be stressful. We are here to help and streamline the process, seeking that strong practical outcomes are sought for your business. Call us today and secure a complimentary consultation today with our seasoned team of Lawyers for Employers.
Written by
David Pawley
Solicitor
NB Employment Law