Replacing "Work Choices", The Fair Work Act 2009 came into effect on 1 July 2009. Provisions relating to the National Employment Standards and Modern Awards will come into effect on 1 January 2010.
Small businesses need to be aware of how these changes effect their obligations and their rights to dismiss employees. Small business employers may need to take time to determine whether they are a small business employer within the definition of the Act. It may be wise to seek legal advice on how these new provisions impact your business.
For Small Business Employers
The Fair Work Act 2009 defines a National System Small Business Employer as a business who employs fewer than 15 employees. In calculating the number of employees of a small business, all employees are considered. Casual employees are not considered unless they have been employed on a regular, ongoing basis.
In relation to a dismissal, when determining the number of employees, the calculation must include the employee who is being dismissed or whose employment was terminated and any other employee who is also being dismissed or whose employment was also terminated.
Associated Entities
When determining the number of employees of a small business, employees employed by associated entities are to be included. For a clear definition of "associated entity" review the Act at ComLaw or talk to a solicitor.
Redundancy Pay
The obligation to pay Redundancy Pay is now a National Employment Standard. Small Business Employers must comply with these Standards from 1 January 2010.
Unfair Dismissal Proceedings
An employee must complete a qualifying period of employment prior to commencing proceedings for unfair dismissal. This is described as the 'Minimum Employment Period'. Note that the less than 100 employees defence to unfair dismissal proceedings, which was available under The Workplace Relations Act, no longer applies. If employees have completed a qualifying period and earn less than the prescribed High Income Threshold, they are entitled to commence proceedings. For small business employers, the qualifying period has been extended to 12 months.
Dismissal – The Small Business Fair Dismissal Code
The Fair Work Act stipulates that an employee has been unfairly dismissed if the dismissal was harsh, unjust or unreasonable, was not a case of genuine redundancy, and was not consistent with the Small Business Fair Dismissal Code. To view the Small Business Fair Dismissal Code visit Fair Work Online.
Permission to be Represented by a Lawyer in Unfair Dismissal Proceedings
Fair Work Australia is the new body that replaced the Australian Industrial Relations Commission. The Act states that a person may only be represented by a lawyer if Fair Work Australia gives its permission. This may happen if the representation would enable the matter to be dealt with efficiently, or if it would be unfair not to allow representation, as in the case where a person is unable to represent themselves or if some anomaly exists in the fairness between the parties. An anomaly in fairness may exist when a small business has no special HR staff or where one party is represented by an agent of an industrial association with experience in workplace relations advocacy.
The Fair Dismissal Code for Small Business Employers
A downloadable Small Business Fair Dismissal Code Checklist can be downloaded at Dismissal Code Checklist.