A new workplace relations system has just started that has important implications for small businesses. These new regulations, especially the Small Business Fair Dismissal Code, are designed to simplify unfair dismissal laws for small business. It’s important all small business owners understand how they are impacted by this new regime in case there is potential for an employee to be dismissed from their businesses.
Under the new scheme:
•New employees are prevented from making an unfair dismissal claim against their employer if the staff member has been employed in the business for fewer than 12 months. Previously, employees could make an unfair dismissal claim after being employed for just six months.
•The Small Business Fair Dismissal Code is designed to help small business owners work out whether a dismissal is fair. Under this code an employee can be dismissed without notice if the employer believes there are reasonable grounds for instant dismissal, for example if there has been serious misconduct such as violence, fraud, theft or serious occupational health and safety breaches. Ideally the employer should make a formal report to the police if there is evidence of any of the above.
•In other situations the employee must be given a reason as to why they are being dismissed, and this reason must be related to the job for which they are being employed.
•The business owner should also give a written or verbal warning before the dismissal occurs that indicates the employee is at risk of being fired if there is no improvement in their performance. The business owner also has to give the employee a chance to improve performance before a dismissal occurs.
•Small businesses also have to be able to provide evidence that they have followed the new code in case the employee makes a claim for unfair dismissal to Fair Work Australia, the body that administers the new rules. A checklist is available on the Fair Work Australia website
www.fwa.gov.au. Completing this checklist and following the steps outlined in it is a good way to demonstrate compliance with this code. Other means of complying include being able to produce written warnings given to the employee before the dismissal, signed witness statements and statements of termination.
Although they might seem confusing at first, the new laws have been designed to streamline the dismissal process for small businesses that have fewer than 15 employees.
They recognise that most small businesses don’t have the employee relations resources available compared to large businesses to handle a complex dismissal process.
If you’re at all concerned about how these new laws affect your business, jump online and check out the new Fair Work Australia website, which has lots of resources to help small business owners understand their rights and obligations under this new regime.