Termination of Employment : A reminder on procedural fairness

The procedural steps taken during the termination process are crucial.

In a recent FWC decision Mr Simon Ronchi v Johns Lyng Group [2022] FWC 326 (available here) FWC has again emphasised the importance of procedural fairness during the termination process, even where there is a valid reason for dismissal.

The employee was terminated for promoting his personal business to clients of his employer without authorisation, neglecting his duties during work hours on 2 occasions and sending inappropriate text messages to a co-worker. 

The employee attended a meeting with his direct manager in order to ‘discuss issues and concerns’. During this meeting the allegations were put to the employee, and he was asked to provide a response. The employee denied the allegations and his employment was subsequently terminated, effective immediately. The duration of the meeting was between 10 – 15 minutes in total.

FWC found that the employee’s actions constituted a valid reason for dismissal on the basis that the conduct was grave and intended to cause damage to the employment relationship. Almost every reasonable person would have expected such a result. Right?

But, FWC held that the employee’s dismissal was procedurally unfair. While the employee was given sufficient information and evidence to understand the allegations and an opportunity to respond, he was not given a genuine opportunity to consider the allegations. FWC stated that:

“Given the serious nature of the allegations and the breadth of evidence against Mr Ronchi, an opportunity to digest the allegations and show cause why he should not be dismissed would have been a more appropriate and fair dismissal process.”

As a consequence, the employee was awarded $1,635.00 compensation. This must have been very upsetting for the employer!

So – what can employers take away from this?

• Don’t rush through or take shortcuts during the termination process, particularly when you have a good reason for dismissal.

• The financial costs of compensation and going through a hearing (legal fees, time wasted for key employees involved) are likely to be enormous compared to what it would have cost to conduct the process properly.

• The emotional satisfaction of a quick termination is likely to be outweighed by the ‘emotional tax’ of going through a hearing.

Treating employees with respect during the termination process is likely to reduce the risk of a claim.

Edge Legal

Relationships.  Respect.  Results