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15 August 2013 A Practical Guide to Warnings in the Workplace

By Richard Ottley, Partner and Laura Sowden, Solicitor


What is a workplace warning?

A warning is a communication be it verbal (more informal) or written (more formal) to an employee about their performance or conduct at work. They are a mechanism for communicating an identified area where an employee needs improvement, or where conduct does not meet the requisite standard. The aim is to improve employee performance or conduct.

The performance or conduct issues which would be the subject of a warning are usually of a less serious nature. That is, they do not warrant summary dismissal. Verbal warnings generally precede written warnings. Usually, once a warning is issued, the employee's performance or conduct is monitored for a set period of time.


Content of a written warning

A written warning should follow a warning meeting, at the conclusion of which, the employee is advised that a written warning letter will follow. The warning letter should follow in a day or so post the meeting. It is suggested that a written warning should:

  • record who was present;
  • record the fact the employee was invited to have a support person present (if they did not avail themselves of this opportunity);
  • outline the conduct or performance which is the subject of the warning;
  • where appropriate refer to a relevant policy or the employment contract;
  • where relevant refer to previous warnings given;
  • record the employee's responses to the matters in issue;
  • records the things which need to happen to address the performance or conduct in question;
  • make it clear that the employee needs to improve, including explaining the consequences of a repetition of the conduct or failure to improve, which could for example result in termination;
  • where relevant provide support for the employee to improve (this can involve the offer of further training);
  • where relevant, provide a timetable for periodic review of the employee's performance;
  • provide a clear paper trail should things not improve and termination result; and
  • preferably be countersigned by the employee to evidence receipt of the warning.
How many warnings should employers give prior to a termination?

There is no legal requirement to give any set number of warnings prior to termination, although the Small Business Fair Dismissal Code made pursuant to the Act, requires one written or verbal warning to be given by "Small Businesses" (employers having less than 15 employees) except in relation to those matters justifying summary termination.

The unspoken rule is to use anything from one to three written warnings prior to any termination. As general guidance, two written warnings should place an employer in a strong position to act decisively if the conduct continues, or the performance does not improve. However a word of warning, if employers have formalised their own performance management procedures into a policy, then they need to ensure that they comply with it, otherwise they may be leaving themselves open to the suggestion that they are in breach of their own policy. It is worth noting that the terms of a policy may be regarded as contractual terms.

Process has an increasingly important place in employment law because of claims for unfair dismissal. It is partly for this reason that support persons are offered to employees, that meetings are clearly documented and clear and unambiguous written warnings are issued.

It is also wise to consider the seriousness of the conduct or performance issues when deciding how many warnings should precede any termination. Two warnings for minor performance or conduct issues might still mean any resulting termination is unfair, whereas repeat conduct following one warning concerning a serious conduct or performance issue can be sufficient to result in a fair termination.

There can be advantages for employers in labelling a warning "Final Warning" in appropriate circumstances, but what is more important is that the letter itself advises as to the consequences of non compliance.

How long does a warning remain current?

Again there is no hard and fast rule, however it would generally be unusual for a warning to remain current after six months had passed with no warnings in between. This is especially relevant in seeking to rely on prior warnings in effecting termination. On the other hand, historical warnings from years past may be examined and considered relevant in court proceedings concerning termination. It will depend on the nature of the previous warnings, and the context surrounding the termination.

One easy way to attempt to give warnings a longer life is to incorporate some sort of monitoring mechanism and period into the warnings. If for instance the warning says, "we will monitor your conduct/performance for a period of six months after the date of this warning letter" then this creates an expectation that the warning has at least six months currency.

What to take away?

Warnings are important workplace tools to help ensure employees understand an employer's expectations. They are evidence of a fair performance management process and they support decisions made to terminate. Ultimately they may play a crucial role in defending unfair dismissal claims. Importantly a failure to implement or appropriately manage or document warnings can come at a high price.

For further information, please contact:

Richard Ottley, Partner  |  Phone: +61 2 9233 5544  |  Email: rbo@swaab.com.au

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This article is not legal advice and the views and comments are of a general nature only. This article is not to be relied upon in substitution for detailed legal advice.

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