As a rule of thumb, you cannot terminate an employee without issuing a warning. In general, employers are required to give written notice to employees of termination to avoid legal liability. There are limited circumstances, discussed below, where an employer may terminate an employee without notice.
How much notice and what entitlements do I need to give?
The National Employment Standards mandate the minimum notice periods required in accordance with the employee’s period of employment. Often, employment contracts stipulate a provision that states the relevant period of notice. However, if the contract’s minimum notice period falls short of the statutory requirement (as stated below), the employer/ee must comply with the statutory minimum.
|Period of continuous service||Minimum notice period|
|1 year or less||1 week|
|1 – 3 years||2 weeks|
|3 – 5 years||3 weeks|
|More than 5 years||4 weeks|
*Note: employees over the age of 45 who have at least two years of continuous services are eligible for an additional week of notice.
The employer must pay the terminated employee any outstanding wages or remuneration and accrued entitlements such as annual leave.
Are there any alternatives to the notice period?
Yes. If it does not suit your business to have the terminated employee work through their notice period, you can pay them their full rate of pay as if they had worked during the minimum notice period. It is also possible to provide a combination of the notice period and pay in lieu (such as 1 week of notice and 1 week of pay in lieu where the employee is entitled to 2 weeks notice).
How do I give notice?
Notice must be given in writing and include the date of termination. The date of termination must be determined with reference to the minimum notice period, the award, any registered agreement or the employment contract (where the contract provides for more time). This date may be adjusted only when the employee will be paid in lieu of the notice period.
Notice must be delivered personally to the employee, left at their last known address, or sent by pre-paid post to their last known address.
So, when can I terminate without notice?
Certain types of employees can be terminated without notice, including:
- Casual employees (however, be cautious with long term casual employees, this could lead to an unfair dismissal claim)
- Seasonal/task employees i.e. employed for a specific time period
- Employees engaged in serious misconduct
- Employees on a training arrangement for a specific time period
- Daily hire employees working in the building, construction or meat industry
- Weekly hire employees working in connection with the meat industry whose termination depends on seasonal factors
Additionally, an employer is not required to give notice where the employee has been involved in serious misconduct. Under the Fair Work Regulations 2009 (Cth), serious misconduct is defined as:
- Wilful or deliberate behaviour by an employee that is inconsistent with the continuation of the contract of employment
- Conduct that causes a serious and imminent risk to the health and safety of a person or the reputation, viability or profitability of the employer’s business
- An employee being intoxicated (to the extent of being unfit for their duties) while working.
- An employee failing or refusing to carry out a lawful and reasonable instruction that is consistent with the employee’s contract of employment.
Some examples of serious misconduct include: theft, fraud, assault, intoxication at work.
An employer is still required to pay an employee terminated for serious misconduct all outstanding entitlements.
What are the legal consequences of failing to give notice?
A failure to give adequate notice exposes your business to various legal actions. This will most commonly take the shape of an unfair dismissal claim to the Fair Work Commission or a breach of contract case.
The requirement to give an employee notice of termination is well established. It is important to check the statutory minimum notice period as well as the employee’s contract and award to ensure you avoid any liability for insufficient notice when terminating an employee. If an employee has been involved in serious misconduct, they can be terminated without notice. However, if you are unsure of your legal obligations, it is best to seek legal advice.
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