Tactics in unfair dismissal cases

I have personally witnessed several employers in unfair dismissal cases endeavour to settle the claims by offering to pay NES entitlements undeniably owed by the employer to the employee in any case. This will ordinarily go down very badly with the Fair Work Commission. Here is an extract of a recent case where the Commissioner felt bound to express his views about the practice which is seen too often.

“S. 387 (a) – Valid reason for the dismissal related to capacity or conduct

[31] In this instance, the applicant was dismissed because the employer determined that it had insufficient funds to continue the employment of the applicant (and other language educators). The evidence unequivocally established that the dismissal of the applicant was in no way connected with any capacity or conduct issue on the part of the applicant.

[32] The employment of the applicant (and 25 other language educators) was established upon contracts that stipulated essentially “full-time” employment based on a minimum payment for 35 hours per week. The employer had identified that its funding arrangements and other income sources that were generated directly from individual schools, were insufficient to sustain the continued employment of language educators engaged on a 35 hours per week basis. Consequently, the dismissal of the applicant (and the other language educators) was for reason of the financial incapacity of the employer.

[33] The evidence has confirmed that the financial incapacity of the employer was the only reason for the dismissal of the applicant. The employer determined that it could simply no longer continue to pay the applicant (and the other language educators) to perform the job of a “full-time” language educator. The termination of the applicant’s employment in these circumstances represented a redundancy. The employer, for financial reasons, determined that it would no longer require the applicant’s job to be performed by anyone.

[34] The prospect that the applicant and other language educators could apply to be re-employed at some point in the future and presumably on less than a “full-time” (35 hours per week) basis, does not mean that the job of the applicant (and the other language educators) continued to be required. It was clear that the “full-time” job of a language educator, in this case, the job performed by the applicant for almost two years, was no longer required to be performed. The employer’s attempted reliance upon the potential for some re-employment of the applicant in the role of a language educator but presumably for significantly lesser hours per week, as the basis to recharacterize the dismissal of the applicant to not represent a redundancy, was a fundamental misconception.

[35] It appeared that the employer has consciously sought to declare that the dismissal of the applicant (and the other language educators) did not represent a redundancy circumstance as a means to avoid payment of the statutory entitlements that arise in respect of dismissal for reason of redundancy. Specifically, the employer has steadfastly maintained that the dismissal of the applicant was not a redundancy and therefore he was not entitled to redundancy pay in accordance with s. 119 of the Act. The position adopted by the employer was plainly erroneous, and the manner in which it has acted in maintaining its opposition to any contemplation of the redundancy circumstance of the dismissal of the applicant, was a highly regrettable and unconscionable attempt to avoid payment of entitlements provided by the National Employment Standards (NES).

[36] The employer introduced evidence that it had acknowledged and accepted that it had failed to make payments to the applicant in respect to notice entitlements arising under both the NES and the contract of employment. However, rather than rectifying its failure to provide the applicant with the entitlements that were due upon termination of employment, the employer openly disclosed that it had attempted to settle the applicant’s unfair dismissal claim by proposing to make payment of these due entitlements, and it steadfastly resisted any further financial consideration. The shameless approach of the employer whereby it sought to use unpaid NES entitlements as a bargaining chip to settle the applicant’s unfair dismissal claim was both disturbing and distasteful to observe, particularly in circumstances where the employer has been legally represented from the outset of these proceedings.

[37] Consequently, the dismissal of the applicant was not for any reason, valid or otherwise, that related to the applicant’s capacity or conduct. The reason for the dismissal of the applicant was that the employer determined that it no longer had the financial capacity to continue the job that the applicant (and other language educators) performed. In these circumstances, the applicant was dismissed for reason of redundancy.”

Riley v NSW Aboriginal Education Consultative Group Incorporated (2022) FWC 2254 delivered 25 August 2022 per Cambridge C