Unfair dismissal; valid reason for dismissal not always required

As is evident from the following extracts from a recent decision of the Fair Work Commission it is not strictly necessary for an employer to have a valid reason for dismissing an employee for the employer to escape an unfair dismissal finding. It is merely one factor.

“Valid reason for the dismissal related to capacity or conduct (including its effect on the safety and welfare of other employees)

While the Commission is obliged to take into account whether there was a valid reason for dismissal relating to the employee’s capacity or conduct, 75 this provision should not be construed as requiring there to be a valid reason. Although, whether there is a valid reason or not will have bearing on the decision reached.

To explain further, ‘valid’ in this context is generally considered to be whether there was a sound, defensible or well-founded reason for the dismissal. 76 The provisions must be applied in a practical, common sense way to ensure that the employer and employee are treated fairly.77

In the context of termination of employment related to the conduct of an employee, it is well established that the Commission must make a finding as to whether the conduct in question occurred. So much is clear from the decision of the Full Court of the Federal Court in Edwards v Giudice, 78 and numerous subsequent decisions of the Full Bench of the Commission.79………..

There was a valid reason for Mr Lear’s dismissal – which of course is a very important consideration in any unfair dismissal case. 81 However, it is not the only factor that must be considered by this Commission.

[104] When considering whether a dismissal was harsh, unjust or unreasonable, the Commission is obliged to take into account any other matters that it considers relevant.

[105] It is well accepted that a dismissal may be harsh, unjust or unreasonable despite the existence of a valid reason for the dismissal. In B v Australian Postal Corporation 85 the Full Bench stated that:

That principle reflects the approach of the High Court in Victoria v Commonwealth and is a consequence of the reality that in any given case there may be “relevant matters” that do not bear upon whether there was a “valid reason” for the dismissal but do bear upon whether the dismissal was “harsh, unjust or unreasonable. 86”


Lear v BHP WAIO Pty Ltd (2020) FWC 4949 delivered 25 September 2020 per Beaumont DP