Unfair dismissal in Australia

This extract from a recent decision of the Fair Work Commission provides an interesting summary of the unfair dismissal jurisdiction.

“Why the Unfair Dismissal Jurisdiction Exists

[3] The unfair dismissal jurisdiction exists because of the ratification of International Labour Organisation Termination of Employment Convention 1982 (ILO Convention 158) and the Termination of Employment Recommendation 1982 (ILO Recommendation 166). The jurisdiction specifically addresses dismissals that occur in circumstances such as those present in this matter. While the Applicant’s contract did allow termination on notice, the Fair Work Act 2009 (Cth) (the Act) provided protection from unfair dismissal.

[4] In June 1982 the International Labour Conference adopted both ILO Convention 158 and ILO Recommendation 166. The main provisions in ILO Convention 158 were carried over

in substantively the same terms from the Termination of Employment Recommendation 1963 (No 119). Key provisions in the Convention outlined the following:1

  • the employment of a worker shall not be terminated at the initiative of the employer unless there is ‘a valid reason for such termination connected with the capacity or conduct of the worker or based on the operational requirements of the undertaking, establishment or service;
  • the following inclusive list shall not constitute valid reasons for termination: union membership or activities; taking part in legal proceedings against an employer; race; colour; sex; marital status; family responsibilities; pregnancy; religion; political opinion; national extraction or social origin; temporary absence from work due to illness or injury; or being on maternity leave;
  • termination for reasons related to the conduct or performance of an employee must not take place until that employee has been provided with an opportunity to defend himself or herself against the allegations made, unless the employer cannot reasonably be expected to provide that opportunity;
  • the Convention applies to ‘all branches of economic activity and to all employed persons’; and
  • some categories of employed persons may be excluded by a member state from all or some of the provisions in the Convention. These include workers engaged under a contract of employment for a specified period of time or specified task, workers serving a period of probation or qualifying period that has been determined in advance and is of a reasonable duration, and workers engaged on a casual basis for a short period of timeP4 Two further categories of employees may be excluded under art 2(4) and (5). The first class is employed persons whose terms of employment are governed by special arrangements that provide protection at least equivalent to the protection afforded under the Convention (art 2(4)). The second category is employees in respect of which special problems of a substantial nature arise in light of the particular conditions of employment, or the size or nature of the undertakings in which they are employed (art 2(5)). Importantly though, art 2(6) requires that in order for exclusions made under art 2(4) and (5) to be valid, they must be listed in the first report of the relevant member state.

Recommendation 166 expands on the provisions of Convention 158 in a number of respects. It recommends the addition of age (subject to national law and practice regarding retirement) and compulsory military service to the list of grounds that are not valid reasons for termination.” It also provides that employers ought to furnish written warnings in relation to termination for misconduct or lack of performance, written notice of termination of employment, and, upon request, a written statement of reasons for dismissal. In addition, the Recommendation 166 provides that an employee should be permitted to be assisted by another person in defending himself or herself against allegations of misconduct or lack of performance.

[Emphasis added]

[5] ILO Convention 158 formed the basis for the unfair dismissal provisions contained in the Industrial Relations Reform Act 1993 (Cth), and ILO Convention 158 and ILO Recommendation 166 were annexed as Schedules to the Industrial Relations Act 1991 (Cth). It is readily apparent how the ILO Convention 158 and ILO Recommendation 166 form the basis of the unfair dismissal jurisdiction.

[6] While the Respondent relied on what was perceived to be their existing contractual right to terminate the Applicant’s employment, it disregarded the ascertainment of what legal rights and obligations should exist, involved in the exercise of arbitral power in the unfair dismissal jurisdiction.2”

Hardman v Australian Institute of Project Management (2023) FWC 2954 delivered 14 December 2023 per Cross DP