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By Natalie Cull
On the surface, a dismissal might seem simple.
However, a dismissal can give rise to different legal claims, and understanding the distinction between them is important for both employees and employers.
Two of the most common claims arising from a dismissal are unfair dismissal and general protections (adverse action) claims. While both may arise from the same set of circumstances, they involve very different legal considerations.
Unfair Dismissal Claims
An unfair dismissal claim focuses on the fairness of the dismissal itself.
When determining whether a dismissal was unfair, the Fair Work Commission will consider matters such as:
– whether there was a valid reason for the dismissal;
– whether the employee was notified of that reason;
– whether the employee was given an opportunity to respond to allegations; and
– whether a fair process was followed.
In simple terms: Was the dismissal harsh, unjust, or unreasonable?
There are also eligibility requirements that must be met before an employee can bring an unfair dismissal claim. Generally, an employee must:
– be a national system employee;
– have completed the minimum employment period (usually six months, or twelve months for a small business employer); and
– earn below the high-income threshold, unless they are covered by an award or enterprise agreement.
General Protections Claims
General protections claims, often referred to as an ‘adverse action’ claim, involve a different enquiry.
Rather than focusing on whether the dismissal was fair, the focus is on why the employer made the decision.
The relevant question is whether the employee was subjected to adverse action, including dismissal, because they exercised a workplace right or possessed a protected attribute.
Examples may include circumstances where an employee:
– made a complaint or enquiry about their employment;
– exercised a workplace right;
– took personal or carers leave;
– sought to access a workplace entitlement; or
– was treated adversely because of a protected attribute such as their age, sex, race, disability, pregnancy or family responsibilities.
If a prohibited reason formed part of the employer’s decision-making process, a general protections claim may arise.
What remedies are available?
Compensation and reinstatement may be available in both unfair dismissal and general protections matters. However, there is a significant difference when it comes to compensation.
In unfair dismissal matters, compensation is generally capped at the lesser of 26 weeks’ remuneration or half of the high-income threshold.
By contrast, this statutory cap does not apply to general protections claims. Depending on the circumstances, the potential compensation available may therefore be significantly greater.
The most important thing employees and employers need to know is that the clock starts ticking from the date of dismissal.
For unfair dismissal applications, they must generally be commenced within 21 days of the dismissal taking effect. The same 21-day timeframe applies to dismissal-related general protections claims.
While extensions may be available in limited circumstances, they are not easily obtained. Delaying legal advice can therefore have significant consequences.
Early Advice Can Make All The Difference
Identifying the most appropriate avenue following a dismissal is not always a simple exercise, especially where both unfair dismissal and general protections frameworks may appear to apply.
However, it is important to understand that you can only bring one claim, not both, so getting legal advice early is key to deciding which option is the right one.
Seeking advice at an early stage helps employees to understand what claims may be available, what evidence is needed, the time limits that apply, and make informed strategic decisions before any proceedings are commenced.
For employers, legal advice can assist in identifying and managing any potential claims that could be brought because of a current or anticipated dismissal, and to put steps in place to manage and reduce risk early on.
Key Takeaway
The distinction between these claims can be summarised simply:
Unfair dismissal looks at the process. General protections looks at the motive.
If you need employment advice, whether you are an employee or an employer, get in touch for a confidential chat. When you only have 21 days to act, getting advice early can make all the difference.
