One of the most important tests used by the Fair Work Commission when determining whether a termination of employment constitutes an unfair dismissal is whether the dismissal was “harsh, unjust or unreasonable”. It is important to note that the tests are disjunctive thus;
“[95] In an Appeal by B, C and D,66 a Full Bench of the Commission discussed the phrase
“harsh, unjust or unreasonable”. The Full Bench held at [53]:
A determination as to whether a dismissal was harsh, unjust or unreasonable involves
the application of a broad discretionary standard. The discretion is nevertheless one
that must be exercised judicially, that is, in accordance with applicable legal
principles…The classic statement of principle comes from the judgement of McHugh
and Gummow JJ in Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 465:
“It may be that the termination is harsh but not unjust or unreasonable, unjust
but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many
cases the concepts will overlap. Thus, the one termination of employment may
be unjust because the employee was not guilty of the misconduct on which the
employer acted, may be unreasonable because it was decided upon inferences
which could not reasonably have been drawn from the material before the
employer, and may be harsh in its consequences for the personal and economic
situation of the employee or because it is disproportionate to the gravity of the
misconduct in respect of which the employer acted.”
[96] The Full Bench continued at [57]:
In Byrne v Australian Airlines (1995) 185 CLR 410 at 467 McHugh and Gummow JJ
endorsed the observations of Sheppard and Heerey JJ in Bostik (Aust) Pty Ltd v
Gorgevski (No 1) [1992] FCA 209; (1992) 36 FCR 20 at 28 in relation to the phrase
“harsh, unjust or unreasonable”:
“These are ordinary non-technical words which are intended to apply to an
infinite variety of situations where employment is terminated. We do not think
any redefinition or paraphrase of the expression is desirable. We agree with the
learned trial judge’s view that a court must decide whether the decision of the
employer to dismiss was, viewed objectively, harsh, unjust or unreasonable.
[2026] FWC 1917
19
Relevant to this are the circumstances which led to the decision to dismiss and
also the effect of that decision on the employer. Any harsh effect on the individual
employee is clearly relevant but of course not conclusive. Other matters have to
be considered such as the gravity of the employee’s misconduct.”
[97] Each of the matters in section 387 of the FW Act must be considered and treated as a
matter of significance in the decision making process.67 However, the Commission is only
required to consider those matters insofar as they are relevant to the factual circumstances of
the particular case.68 The weight given to each such relevant matter is a matter for the
Commission in coming to an overall conclusion as to whether the dismissal was harsh, unjust
or unreasonable.69
[98] The matters set out in section 387 of the FW Act are considered below.
Whether there was a valid reason for the dismissal related to Ms Foster’s capacity or
conduct (including its effect on the safety and welfare of other employees): Section
387(a)
[99] A Full Bench of the Commission in Sydney Trains v Gary Hilder70 explained that the
principles applicable to the consideration required under section 387(a) were well established
and reiterated those principles. The reiteration of those principles is reproduced below:
(1) A valid reason is one which is sound, defensible and well-founded, and not fanciful,
spiteful or prejudiced.
(2) When the reason for termination is based on the misconduct of the employee the
Commission must, if it is in issue in the proceedings, determine whether the conduct
occurred and what it involved.
(3) A reason would be valid because the conduct occurred and it justified termination.
There would not be a valid reason for termination because the conduct did not occur or
it did occur but did not justify termination (because, for example, it involved a trivial
misdemeanour).
(4) For the purposes of s 387(a) it is not necessary to demonstrate misconduct
sufficiently serious to justify summary dismissal on the part of the employee in order to
demonstrate that there was a valid reason for the employee’s dismissal (although
established misconduct of this nature would undoubtedly be sufficient to constitute a
valid reason).
(5) Whether an employee’s conduct amounted to misconduct serious enough to give rise
to the right to summary dismissal under the terms of the employee’s contract of
employment is not relevant to the determination of whether there was a valid reason for
dismissal pursuant to s 387(a).
(6) The existence of a valid reason to dismiss is not assessed by reference to a legal
right to terminate a contract of employment.
[2026] FWC 1917
20
(7) The criterion for a valid reason is not whether serious misconduct as defined in reg
1.07 has occurred, since reg 1.07 has no application to s 387(a).
(8) An assessment of the degree of seriousness of misconduct which is found to constitute
a valid reason for dismissal for the purposes of s 387(a) will be a relevant matter under
s 387(h). In that context the issue is whether dismissal was a proportionate response to
the conduct in question.
(9) Matters raised in mitigation of misconduct which has been found to have occurred
are not to be brought into account in relation to the specific consideration of valid
reason under s 387(a) but rather under s 387(h) as part of the overall consideration of
whether the dismissal is harsh, unjust or unreasonable.
[100] I apply those principles in taking into account section 387(a) of the FW Act
Ms Jennifer Foster v MSWA Limited -[2026] FWC 1917 per Walkaden C delivered 11 June 2026