Resources: Blog

What is “Procedural Fairness”?

Blog
|

Employment Law Essentials

Whether the termination of an employee’s employment was procedurally fair or unfair forms the basis of the unfair dismissal jurisdiction under the Fair Work Act 2009 (Cth) (FW Act). Employers can often put themselves at risk of unfair dismissal claims when procedural fairness is not provided to employees during disciplinary action and / or the termination process.

Whether the termination of an employee’s employment was procedurally fair or unfair forms the basis of the unfair dismissal jurisdiction under the Fair Work Act 2009 (Cth) (FW Act). Employers can often put themselves at risk of unfair dismissal claims when procedural fairness is not provided to employees during disciplinary action and / or the termination process.

 

What is procedural fairness?

The term “procedural fairness” is often used interchangeably with “natural justice” and generally means that an employee is given the opportunity to defend themselves and raise any mitigating circumstances before a decision is made.

In practice, in the disciplinary and / or termination processes, affording procedural fairness usually involves:

  • Putting the allegation to the employee;
  • Providing the employee a reasonable opportunity to respond;
  • Genuinely taking into account the responses the employee provides; and then
  • Making a decision on a suitable disciplinary penalty (including termination of employment) based on all relevant information.

It is particularly important in providing procedural fairness that the employer does not skip or rush a step, or form an early view about the employee’s guilt or innocence, and carry that through the process. Accordingly, the final decision to terminate the employee’s employment should not be prematurely or hastily made.

 

Case Study - Jimenez v Accent Group T/A Platypus Shoes (Australia) Pty Ltd [2016] FWC 5141

For example, in Jimenez v Accent Group T/A Platypus Shoes (Australia) Pty Ltd [2016] FWC 5141, the employer summarily dismissed the Store Manager for what it said was serious misconduct.

The Fair Work Commission (the Commission) held that the termination procedure followed by the employer was “manifestly erroneous” and made, what should have been a fair dismissal with notice, an unfair dismissal.

The employee was invited to a meeting at head office which, as noted by the Commission, he was led to believe was about good news. At the meeting, the employee was actually advised about fraud and theft allegations against him and was asked to provide written responses to those allegations.

The employee was then required to attend a further meeting where his responses were reviewed. After just a 20 minute break in that meeting, the employee was advised that his employment was terminated without notice and was given a termination letter. Amongst other things, the termination letter referred to the Applicant attending the meeting with his solicitor, when in fact he attended with a friend as his support person.

The Commission found that the employer had already formed a view about the guilt of the employee because the employee was deliberately misled about the nature of the first meeting which was actually a “show cause” meeting, and because the termination letter which was handed to the employee after a short break was clearly pre-prepared. For the Commission, the content of the letter indicated that the employer had formed a view about the allegations it was meant to be evaluating.

Relevantly, the Commission stated: “The concept of the need to provide an opportunity to respond to potential reasons for dismissal...is fundamentally predicated upon the decision-maker approaching the issues under consideration with an open mind such that the opportunity represented some practical and realistic potential to persuade the decision-maker to a particular view.

As a result, the employer was ordered to pay one week in compensation to the employee.

In an unfair dismissal application the Commission will consider the process the employer took when terminating the employee’s employment and the criteria for “harsh, unjust or unreasonable” including:

  • Whether there was valid reason for the dismissal;
  • Whether the employee was advised of the valid reason and provided with an opportunity to respond / explain;
  • Whether the employee was unreasonably refused a support person;
  • If the employee was dismissed due to unsatisfactory performance, whether the employee was previously given an warning; and
  • Any other relevant matters.

 

Case Study - Jan v NRS Engineering Solutions Pty Ltd [2017] FWC 1500

In Jan v NRS Engineering Solutions Pty Ltd [2017] FWC 1500, the security guard employee was told his employment was terminated because the host employer no longer wanted him on site after some items were taken.

The employee claimed that he was only told by text message why he was dismissed after making enquiries with his employer.

The Commission accepted the evidence of the employee that he was not told of the reason for the termination of his employment or provided an opportunity to respond to the allegation.

The Commission ordered the employer to pay the employee compensation.

 

Case Study - Moore v Specialist Diagnostic Services Pty Ltd T/A Dorevitch Pathology [2016] FWC 5910

Similarly, in Moore v Specialist Diagnostic Services Pty Ltd T/A Dorevitch Pathology [2016] FWC 5910, the Commission considered that the employer’s conflicting reasons for the termination of the employee’s employment impacted on the procedural fairness afforded to the employee as she was not given the opportunity to respond.

 

Case Study - Drysdale v John L Pierce Pty Ltd [2017] FWC 1251

Conversely, in Drysdale v John L Pierce Pty Ltd [2017] FWC 1251, the employer’s termination process was held to be fair by the Commission.

In that case, a fuel delivery driver was terminated without notice for breaches of the employer’s mobile phone and safety policies relating to the unloading of fuel.

The Commission found that there were valid reasons for the termination of his employment and after going through each of the factors above, the Commission was satisfied that the employee was afforded procedural fairness during the process leading to the termination of his employment. The Commission dismissed the unfair dismissal application.

 

Closing Comments

Other aspects for employers to consider include:

For employers, a failure to provide procedural fairness to an employee may result in a finding by the Commission that there was a valid reason for the termination of the employment but it was nevertheless harsh, unjust and unreasonable because of the lack of procedural fairness.

 

What’s Next

Next in our series of “Employment Law Essentials”, we will discuss substantive fairness in the disciplinary and termination process and how the Commission will consider substantive fairness in unfair dismissal applications.

 

Similar articles

FWC finds that employee’s employment ended at end of fixed term and was not dismissed

Time goes by so slowly

Access to the unfair dismissal jurisdiction under the Fair Work Act 2009 (Cth) is on the basis that the employee is “dismissed” from the employment. A jurisdictional objectional can be raised if the employee has not been actually dismissed by the employer.

Read more...

Commission finds employer’s suspicion of an employee’s misconduct was not a valid reason for dismissal

Under suspicion

If considering taking disciplinary action due to an employee’s misconduct, it is critical that an employer makes a decision based on wrongdoing as opposed to a mere suspicion of wrongdoing.

Read more...

Commission finds termination letter sent to inactive email address was not notification of dismissal

You've got mail!

Given the serious nature of matters such as dismissals, employers should, as far as reasonably practicable, communicate such matters in person to ensure that there is no confusion about when the employee was made aware of any issues with their employment.

Read more...

Commission finds mask mandate to be a lawful and reasonable direction

Mask up

Employees have a duty to comply with lawful and reasonable directions from their employer. In the current COVID-19 context, a key concern for employers is whether it is lawful and reasonable to issue directions related to safety matters arising from the pandemic.

Read more...

Lack of consultation rendered mandatory vaccination requirement unreasonable

Talk before you walk

Consultation with employees always plays an important part when introducing changes in the workplace. Under work health and safety legislation, employers have a duty to consult with their workers as far as reasonably practicable in relation to health and safety matters.

Read more...

Offers of alternative employment in redundancy cases

An offer you can refuse

In most cases of redundancy, employers have an obligation to consult with affected employees about the proposed redundancy and consider whether or not anything can be done to mitigate or minimise the impact on the employee, such as redeployment or obtaining other acceptable employment for the employee.

Read more...

Let's talk

please contact our directors to discuss how ouR expertise can help your business.

We're here to help

Contact Us
Let Workplace Law become your partner in Workplace Relations.

Signup to receive the latest industry updates with commentary from the Workplace Law team direct to you inbox.