Main Grounds For Termination

These come under four headings:

Non-performance

An employee’s performance will be considered inadequate or poor where the employee is repeatedly not meeting the requirements of the position (as set out in the employee’s job description; contract or company policy). Poor performance may be observed by the employee’s manager or other relevant person or may be the result of a formal performance evaluation.

Misconduct

Misconduct can be defined as the substantial or intentional disregard of the employer’s interests. The deliberate nature of the act is a crucial component of the definition.

Serious misconduct includes:
Wilful, or deliberate, behaviour by an Employee that is inconsistent with the continuation of employment, including:
• theft;
• fraud (including falsifying time records);
• assault;
• attendance at the workplace under the effects of prohibited drugs or alcohol;
• the Employee refusing to carry out the Employer’s lawful and reasonable instruction and

Conduct that causes imminent, and serious, risk to:

• the health, or safety, of a person; or
• the reputation, viability or profitability of the Employer’s business.

Redundancy

A redundancy occurs if the employee’s employment is terminated at the initiative of the employer because the employer no longer requires the job to be done by anyone or because of insolvency or bankruptcy of the employer.

Resignation

Resignation refers to an employee’s voluntary decision to leave a position or job. The critical element is that the exercise has to be voluntary in order to be considered a genuine resignation.

Termination for poor performance.

This article focuses on termination for poor performance and the steps to follow. If you are concerned as an employer about the non-performance of an employee, then you need to make sure you implement performance management procedures. Before dismissing an employee for any reason, employers are required to demonstrate two kinds of ‘fairness’ – substantive fairness and procedural fairness. The former is about having a legitimate reason to dismiss someone and the latter is how you go about effecting that dismissal.

1.1. Substantive Fairness

Substantive fairness requires that the facts of the case justify the decision of the employer to dismiss an employee. Substantive matters include having a legitimate reason to dismiss someone such as evidence of any misconduct or performance issues.

1.2 Procedural Fairness

Procedural fairness can be summarised into three broad sections –

1. notification,
2. opportunity to respond, and
3. warnings.

It requires the disciplinary procedure to be applied fairly and consistently in the workplace to all employees. Although procedural fairness is only one factor that will be taken into account in an unfair dismissal case, it is one of the most important ones.

Giving the employee the opportunity to respond to the reasons given for dismissal and to ask questions is also very important. It is particularly important if the reason for the dismissal is the employee’s conduct or work performance.
In order to avoid any legal problems down the track it is important that you establish strict guidelines for management to follow when attempting to discipline or dismiss employees.

Option 1: Informal Counseling
Where an employee’s performance does not meet a satisfactory standard the first step taken should be informal counseling. The employer should provide the employee with details of the non-performance and an opportunity to improve within a set timeframe. Any support required to assist the employee should be discussed.
Where informal counseling does not produce the required outcomes, a more formal process should be entered into. This may involve a performance management plan that documents the issues, actions to be taken and review timeframes.

Option 2: Dismissal following warnings
There is no set number of warnings that must be given to an employee about unsatisfactory performance but there should be at least one warning of possible dismissal, including instructions for improvement of work performance, and a set time for a review of performance.

Managing for Performance through a Warning System

Step 1. Setting up a meeting with the employee
As soon as problems or concerns regarding an employee’s performance and/or behaviour appear raise them with the employee.

Follow these points:
• approach the employee discreetly
• let them know the purpose of the meeting; and
• invite them to bring a support person if they choose
A manager can also invite a note taker to be present.

Step 2. In the meeting:
• Give clear evidence or examples to demonstrate that the employee’s performance is unsatisfactory;
• Ensure the employee knows what to do and that he/she has the skills and resources to do the job;
• Make sure that the employee understands your expectations with respect to performance
• Provide the opportunity for discussion.
• Provide solutions and identify training and support requirements where appropriate.
• Document the discussions and give a copy to the employee

Step 3. After the meeting:
• Monitor the employee’s performance and/or behaviour.
• Meet with the employee as necessary or as agreed.

Step 4. Follow up:
If the employee reaches the agreed expectations, then the process will come to an end. This should be confirmed in writing.

Step 5. Final Warning
If after a reasonable amount of time it appears that satisfactory progress is not being made, you will need to follow up with another formal meeting with set timeframes for improvement.

The time afforded to the employee to improve will depend on the seriousness of the non-performance and the nature of the role. If the employee is not improving make them aware that if they cannot meet reasonable expectations of performance within a set timeframe, that termination may result. Follow the meeting with a letter confirming the outcomes.

If after issuing a final warning sufficient improvement has not occurred during the specified period, meet with the employee and advise that termination of their employment is to follow. Invite them to offer any mitigating circumstances as to why their employment should not be terminated.

Record the considerations given to matters raised by the employee and allow yourself sufficient time to consider other relevant matters even if not raised by the employee, such as the length of service and past record of the employee.

Step 6. Termination
Advise the employee of your decision and provide written notice of termination. Termination of this nature requires relevant notice in accordance with the Fair Work Act 2009 (Cth) (“Act”) or a payment in lieu of that notice period.

Reminder about Procedural Fairness:

Throughout this process, the employer should ensure that the process is fair which includes:
• The standards of job performance required need to be made clear to the employee
• The employee will be advised of the process in the event that satisfactory performance is or is not maintained
• The employee may have a support person at any meetings
• The employee will have an opportunity to respond and put their side of the story
If an employer follows this process and the reasons for the termination are sound, the employer should be in a good position to defend its conduct if required to do so.