Employment Law - Unfair dismissals under the Fair Work Act - Remedies and Entitlements

Date: April 15, 2010

Authors: Michael Pickering B.A., LL.B. (Hons.), LL.M., M. A.

Remedies

Remedies under the Fair Work Act are largely the same as under Work Choices. Reinstatement is the primary remedy. However, Fair Work Australia’s power to reinstate has been increased to order reinstatement to ‘associated interties’ – in other words to other companies in a group.

Compensation is available to employees who were terminated unfairly and will continue to be a maximum 26 weeks’ pay. Fair Work Australia is also unable to award compensation for shock or distress arising from the dismissal and may reduce compensation due to the employee’s own misconduct.

On the issue of remedies, the Fair Work Act changes remedies in the unlawful termination jurisdiction in comparison to new remedies available in the new general protection jurisdiction. Where an applicant brings the matter to the Federal Court or to the Federal Magistrate’s Court under the new general protection provisions, those Courts may order reinstatement, compensation or an injunction. The compensation available is no longer capped at six months pay and no longer expressly excludes compensation for injured feelings.

Traditionally, the Federal Court and the federal Magistrate’s Court had been more willing to grant more generous remedies than the work place tribunals. These courts also have the power to fine employers. The fine for unlawful termination has now been increased to $33,000.

Entitlements

The National Employment Standards are also relevant to termination of employees. There are 110 employment conditions which apply to all employees within Victoria. The termination of any employee because of an entitlement to any one of the National Employment Standards would contravene the general protection provisions being adverse action because of a work place right. One standard (relating to notice of termination and redundancy pay) applies directly to the entitlements of an employee upon termination. The Fair Work Act also provides a minimum requirement of notice to be given to an employee on termination. The period of required notice reflects that contained in Work Choices. As such, employers must not terminate an employee unless the employee is given notice as follows:

  • Employment of not more than one year - 1 week notice;
  • Employment more than one year but not more than 3 years- 2 weeks notice
  • Employment more than 3 years but not more than 5 years- 3 weeks notice, and
  • Employment more than 5 years– 4 weeks notice

The Fair Work Act also gives an entitlement to redundancy pay where the employee is terminated by the employer because the employer no longer requires the job to be done by anyone. The redundancy entitlements are as follows:

  • Employment at least one year but lest than 2 years - 4 weeks
  • Employment at least 2 years but less than 3 years – 6 weeks
  • Employment at least 3 years but less than 4 years – 7 weeks
  • Employment a least 4 years but less than 5 years – 8 weeks
  • Employment at least 5 years but less than 6 years – 10 weeks
  • Employment at least 6 six years but less than 7 years – 11 weeks
  • Employment at least 7 years but less than 8 years - 13 weeks
  • Employment at least 8 years but less than 9 years - 14 weeks
  • Employment at least 9 years but less than 10 years - 16 weeks
  • Employment at least 10 years – 12 weeks

The reduction to 12 weeks after 10 years service is designed to reflect the point at which an employee would usually be able to access Long Service Leave entitlements under state legislation. 

The above redundancy scheme will not apply to the following employees:

  • casuals;
  • fixed term employee’s;
  • employees covered by industry redundancy schemes; or
  • employee’ s who reject reasonable offers of alternative employment in a transfer of business situation; or
  • employee’s working in a small business of 15 employees or less.

Finally, common law contracts of employment will continue to regulate a large number of employment relationships under the Fair Work Act. This will continue to be the case notwithstanding the creation of ‘Modern Awards’ by the Australian Industrial Relations Tribunal since January 2010. These Modern Awards cover ten modern award conditions which are similar to the National Employment Standards that provide the basic safety net for employees.

This article is intended only to provide a summary of the subject matter covered. It does not purport to be comprehensive or to render legal advice. No reader should act on the basis of any matter contained in this article without first obtaining specific professional advice. 

Contact us now for Fast, Accurate and Timely legal advice

Phone LAC Lawyers on NSW 1300 799 888 or VIC 1300 734 638 or send us an email 

Book an Appointment Make an Enquiry
Contact Us
  • Sydney
    1300 799 888
  • Melbourne
    1300 734 638
  • After Hours Emergency: 0417 229 790
  • View All Offices
Featured
Peter Chandra LL.M. (Notary)

My mission is to achieve success for clients through honesty, sincerity, integrity, promptness and excellence in provision of legal services

Full Profile

Thank you kindly for all the work that you've done on my and my wife's behalf. A big pressure has been taken off our chests

Happy Client