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3.2.4 Termination of Employment

Lesson Progress

3.2.4 Termination of Employment

In the final step in managing under-performance, termination of employment is mentioned as a last-ditch option you may use if an employee’s performance does not improve to an acceptable standard. Once again, the Fair Work Ombudsman’s site discussion of this will be helpful to note.

As the site suggests, you cannot dismiss your employees in circumstances that are ‘harsh, unjust or unreasonable’.  Remember to be fair to your employees, especially when you are about to terminate their employment. In this case, you must provide clear reasons for their termination and a chance for them to respond to these.

Notably, businesses with fewer than 15 employees are covered by special dismissal arrangements that vary from those that apply to larger organisations. As detailed by the Fair Work Ombudsman’s site, the special arrangements that apply to employers with fewer than 15 employees are: 

  • Employees will need to have worked for the business for 12 months in order to be eligible to make a claim for unfair dismissal, and 
  • If a small business employer adheres to the Small Business Fair Dismissal Code and the dismissal of their employee is not harsh, unjust or unreasonable, then the dismissal is considered fair. 

You should also ensure that you provide the employee with their entitlements, such as their notice of termination and any annual leave that they have accrued.

Further Reading

Managing under-performance is considered a best practice. To learn more about best practices, you may read through the Fair Work Ombudsman’s guide linked here Best Practice Guide: Managing underperformance.