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Consultation and notice required in employment termination

A RECENT decision by the New South Wales Industrial Relations Commission has indicated a termination can be considered harsh, unreasonable or unjust where there is a failure to provide reasonable consultation and notice prior to the termination.

The employee had been employed for more than 10 years as both a therapist and receptionist for the employer’s business.

Her employment was terminated on the ground the employer was restructuring the business.

No notice was provided to the employee and while an alternative casual position was offered, it was done so without any consultation with the employee.

In addition, the employer had discussed the new arrangements and given notice to two new employees in the week prior to the termination.

The employer gave evidence that the change of employment relationship was a result of professional advice to the effect that the business required the restructure in order to remain solvent.

The employee, however, submitted that the employer’s offer to the applicant to take up the new agreement was not genuine but was designed to remover her from employment and sever all contact between her and the business.

The commission found that the employer had a valid right to terminate the employee on the grounds of a genuine business restructuring.

However, he held that the lack of consultation, together with the pre-emptory means of termination of employment and the offer of an alternative arrangement without any notice at all, constituted harsh and unreasonable treatment.

The commission found that as reinstatement or re-employment was not appropriate, compensation was awarded for 10 weeks’ wages, totalling $8,000.

This decision is largely consistent with the Minimum Conditions of Employment Act, which applies in Western Australia.

This act states that where an employer has decided to take action that is likely to have a significant effect on an employee, or make an employee redundant, the employee is entitled to be informed by the employer as soon as reasonably practicable after the decision has been made of that action.

The employer must also discuss with the employee the likely effects of the action in respect of the employee and the measures that may be taken by the employee or the employer to avoid or minimise a significant effect.

Carla Paratore, solicitor

9288 6940

Ian Curlewis, partner

9288 6756

 

 

 

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