Small business win on unfair dismissal

Under Labor's system, small-business employees will be entitled to one warning and a "reasonable opportunity" to improve their conduct before being at risk of dismissal.

"It's as simple as that," Deputy Prime Minister, Julia Gillard said, addressing a National Press Club lunch in September. "Multiple warnings are not required. There is no requirement for 'three strikes and you're out'.

"As long as employers comply with this (Fair Dismissal Code for Small Business), the dismissal will be held to be fair."
The rules would allow small business to get on with running their operations, making a profit and giving people jobs, Ms Gillard said.

Commenting, Australian Chamber of Commerce and Industry Chief Executive, Peter Anderson said there were concerns from small business about the reintroduction of the unfair-dismissal system. "The Government is trying a new approach with the code. The code, if properly structured, needs to be given a go," he said. Mr Anderson said the plans put faith in the ability of the new industrial umpire, Fair Work Australia, to screen out illegitimate claims. He said businesses being required to pay money to deal with illegitimate claims had been a well-documented problem in the past.

Under the new rules, compensation will be capped at six months' pay for the most serious cases of unfair dismissal and legal representation at Fair Work Australia will be allowed only in "exceptional circumstances".

The National Farmers Federation said the move struck a "sensible, practical balance" for employers and employees. "The new Fair Dismissal Code is thorough, but not onerously restrictive, and it makes provision for addressing issues around staff performance," said President David Crombie.

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