Letting someone go is rarely easy, but getting it wrong can be much harder. In Australia, even if you have a valid reason to terminate someone’s employment, be it misconduct, poor performance, or redundancy, your process must be fair.
It’s not just about doing the right thing, it’s about legal compliance.
Dismissals must align with:
- The Fair Work Act 2009;
- The National Employment Standards (NES);
- Any applicable Modern Award or Enterprise Agreement;
- The employee’s contract of employment; and
- Your business’s own workplace policies and procedures.
Failure to meet these legal and procedural obligations can turn a justified dismissal into a costly and frustrating legal dispute. In some cases, procedural missteps have resulted in significant compensation payouts, even where the underlying behaviour clearly warranted termination.
Why Doesn’t Australia Follow the U.S. ‘At-Will’ Employment Model?
If you’ve ever wondered why, you can’t simply dismiss an employee on the spot as they do seem to do in some U.S. workplaces, the reason lies in the foundations of Australia’s employment law.
Unlike the United States which allows for ‘at-will’ employment, meaning employees can be terminated at any time without cause, Australia has long prioritised a more structured and fair approach.
Our system grew out of early 20th-century compulsory arbitration, where courts and tribunals played a central role in resolving disputes. This led to the development of industry-wide Awards and a national emphasis on industrial fairness, often captured in the principle of a ‘fair go all round.’
By the 1990s, the introduction of statutory unfair dismissal laws through the Industrial Relations Reform Act 1993 (and later, the Fair Work Act 2009) formalised this commitment. This was underscored when Australia also ratified ILO Convention 158, which requires that dismissals be based on valid reasons and carried out fairly.
For employers, this can sometimes feel like a frustrating, resource-heavy process, especially when it seems obvious that someone just isn’t working out, but it’s important to remember procedural fairness isn’t just a hoop to jump through. It’s a legal and cultural safeguard that, when followed well, actually protects your business as much as the employee.
What is Procedural Fairness?
Procedural fairness ensures that dismissal decisions are made fairly, transparently, and in accordance with legal standards. It doesn’t mean you can’t dismiss someone, it means you need to do it the right way.
Under section 387 of the Fair Work Act, the Fair Work Commission considers:
- Whether the employee was told what the issue was;
- Whether they had a genuine opportunity to respond;
- Whether they were allowed to bring a support person; and
- Whether the dismissal was proportionate and reasonable in the circumstances.
But it’s not just about ticking boxes, it’s about consistency and process. Employers must also follow any steps required by the employee’s Award or contract, and their own workplace procedures.
Where Employers Often Get It Wrong
Overlooking Contracts, Awards or Policies: Sometimes the employee’s contract or Award requires a formal process, like issuing written warnings or offering improvement plans. Skipping those steps can make even a justified dismissal legally risky. You may wish to read our article about the pros and cons of incorporating policies and procedures into an employment contract.
Procedurally Unfair: Sometimes the procedural errors made by the employer have rendered what would have otherwise been an entirely fair dismissal with notice, to be an unreasonable and unjust summary dismissal. In Jimenez v Accent Group, an employee was terminated for serious misconduct (failing to properly record and receipt the cash provided for a sale of shoes to a friend). However, the employer had consciously permitted the applicant to come to work following a workplace investigation in the full knowledge of the nature and extent of the misconduct for which it later summarily dismissed him. Allowing the applicant to continue work was considered inconsistent with decision to then summarily dismiss him based on that misconduct.
Treating Similar Cases Differently: Consistency is critical. In Fagan v Department of Human Services, an employee was dismissed for conduct (taking toilet paper to an inmate during lockdown in breach of the employer’s policy) that another team member wasn’t penalised for. The Fair Work Commission found that differential treatment made the dismissal harsh.
Failing to document: It is not uncommon for employers to fail to document discussions, warnings, or the employee’s responses. This can be a costly mistake. In contrast, Rooney v Pickles Auctions upheld a dismissal where the employer had clearly documented each step of a structured performance management process and given the employee the opportunity to explain or make out his defence for failing to attend for work at or before his scheduled start time and without prior notification of his lateness.
Make sure your business remains legally compliant, call us on (02) 9199 8597 or email us to discuss your employment law needs.
What Does a Fair Process Look Like?
A procedurally fair process doesn’t mean dragging things out unnecessarily, it just means being deliberate, clear, and consistent:
Be specific: Clearly communicate the concern, whether it’s performance, misconduct, or breach of policy, and refer to relevant obligations in the Award or contract.
Give the employee a chance to respond: This needs to be more than a formality; the employee should genuinely have an opportunity to tell their side of the story.
Allow a support person: Denying this right can be a procedural flaw, especially in formal meetings that could result in dismissal.
Keep written records: Document everything, warnings, meetings, performance reviews, and the employee’s responses.
How to Protect Your Business
The biggest business risk for employers is ignoring the cultural and legal entrenchment of procedural fairness in workplace relations law:
Know your obligations: Familiarise yourself with the applicable Award, the employee’s contract, and your internal procedures.
Train your managers: Equip them to spot performance or misconduct issues early and handle the process lawfully.
Document consistently: Good notes and clear records can make all the difference if the dismissal is challenged.
Seek advice before dismissing: A short call with a legal advisor can confirm whether your intended process is compliant, and help you avoid missteps.
How we can help
Procedural fairness isn’t about red tape for the sake of it. It’s a legal requirement, but also a protective mechanism for businesses doing the right thing. Yes, the process may feel drawn out, especially when an employee clearly isn’t a good fit. But handled properly, it gives your dismissal decisions legal weight and reputational integrity. And if you’re dealing with a challenging staff member now, the best time to get your process right is before you take action.
We’re here to help you protect your business. Call us on (02) 9199 8597 or email usto discuss your employment law needs.
The information contained in this post is current at the date of editing – 9 May 2025.
