Generally, employers are required to engage in consultation prior to an employee’s dismissal, beyond perfunctory advice about what is occurring. However, in a recent decision the Fair Work Commission (FWC) found that there can exist specific circumstances that will render a dismissal valid despite a lack of meaningful consultation. In this case, a small real estate agency was downsizing and restructuring its business as a result of an industry downturn and changes to the relevant award, which prevented employees from being paid solely on commission. The employee was informed that given his low sales, he presented a financial risk to the business and therefore his employment was to be terminated in two days. This led the employee to lodge an unfair dismissal claim. Ultimately the FWC found that the employer should have more fully consulted with the employee, however, the dismissal was not harsh, unjust or unreasonable. In reaching this finding the FWC emphasised that the circumstances of the dismissal proved that consultation was ‘unlikely to negate the operational reasons for dismissal or lead to any other substantive change.’ It is important to recognise that this was an exceptional decision based on very specific circumstances. In general, where consultation is required under an industrial instrument, employers should adequately consult with employees prior to termination for any reason. Contact M+E for further information or advice on employment matters.


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