The top five mis­takes employ­ers make when ter­mi­nat­ing employ­ment: No.3 Min­i­mum employ­ment periods

For employ­ers with less than 15 employ­ees*, an employ­ee will only be able to make a claim for unfair dis­missal where they have a peri­od of con­tin­u­ous ser­vice of at least 12 months. For employ­ers with 15 employ­ees or more*, a claim for unfair dis­missal is only poten­tial­ly avail­able where an employ­ee has at least 6 months of con­tin­u­ous service**.

Whilst it is com­mend­able to give employ­ees every chance to suc­ceed in their role, the truth is that due to the unfair dis­missal rules, it is usu­al­ly safer to ter­mi­nate an employ­ee’s employ­ment dur­ing the first 6 months of their employ­ment (or 12 months for employ­ers with less than 15 employ­ees), rather than delay­ing tak­ing this action to a lat­er date.

Unless there is a spe­cif­ic pro­vi­sion in an employ­ment con­tract or in an award or enter­prise agree­ment which deals with the process for ter­mi­nat­ing employ­ment, an employ­ee who has not yet worked for the min­i­mum employ­ment peri­od can be ter­mi­nat­ed with­out being giv­en a rea­son for the ter­mi­na­tion. There is also no require­ment for the employ­ee to have been issued with writ­ten warn­ings, to have been sub­ject to a per­for­mance improve­ment plan or to have been required to attend for­mal or dis­ci­pli­nary meet­ings pri­or to the ter­mi­na­tion, etc.

It is only once an employ­ee has worked the min­i­mum employ­ment peri­od that warn­ings, per­for­mance improve­ment plans and for­mal meet­ings become rel­e­vant (as evi­dence of a dis­missal not being unfair).

For the above rea­sons, employ­ers often include in employ­ment con­tracts a pro­ba­tion­ary peri­od with­in which the employ­ee’s ini­tial per­for­mance is assessed. To be clear: a con­trac­tu­al pro­ba­tion­ary peri­od does not (and can­not) affect an employ­ee’s abil­i­ty (or inabil­i­ty) to make a claim for unfair dis­missal. How­ev­er, a pro­ba­tion­ary peri­od set to expire pri­or to the employ­ee hav­ing worked the min­i­mum employ­ment peri­od for unfair dis­missal is a use­ful tool to remind employ­ers to con­sid­er the ongo­ing suit­abil­i­ty of an employ­ee before an employ­ee has a right to bring an unfair dis­missal claim.

All this said, remem­ber that – regard­less of whether an employ­ee has a right to claim unfair dis­missal – there are oth­er legal reme­dies avail­able to employ­ee which do not depend on the length of ser­vice. Claims in gen­er­al pro­tec­tions and dis­crim­i­na­tion being the most obvi­ous exam­ples of claims that are avail­able from day one of employment.

Fol­low­ing a dis­ci­pli­nary process and hav­ing an audit trail of warn­ings etc may there­fore be advis­able in the con­text of poten­tial gen­er­al pro­tec­tions or dis­crim­i­na­tion claims. The accu­mu­la­tion of evi­dence of poor performance/​conduct and dis­ci­pli­nary steps tak­en, will gen­er­al­ly be of assis­tance to employ­ers in demon­strat­ing that the rea­son for dis­miss­ing an employ­ee was not for a rea­son pro­hib­it­ed under gen­er­al pro­tec­tions or dis­crim­i­na­tion legislation.

* The cal­cu­la­tion of the num­ber of employ­ees includes employ­ees of asso­ci­at­ed enti­ties”. It includes full time and part time employ­ees and cer­tain casu­al employees.

** There may be oth­er rea­sons why an employ­ee is not enti­tled to bring a claim for unfair dis­missal, such as that they earn more than the high income thresh­old” (unless they are cov­ered by a mod­ern award or enter­prise agreement).