The Advantages of Lodging a General Protections Claim – A Guide by Adverse Action Lawyers, Perth

If an employee has had their employment terminated, an employee can commence various claims arising from the dismissal, including a general protections claim (also known as an adverse action claim), an unfair dismissal claim, or a discrimination claim.

This article explores the advantages of commencing a general protections claim over an unfair dismissal claim.

Section 725 of the Fair Work Act 2009 specifies that a person must not commence, among other things, a general protections claim and an unfair dismissal claim at the same time. This forces a dismissed employee to choose one or the other.

We often advise dismissed employees who have the option of making both claims. If you are faced with the choice of commencing both an unfair dismissal claim and general protections claim, which one do you choose?Generally speaking, it is more advantageous to commence a general protections claim for the reasons mentioned below.

No Compensation Cap

A general protections claim does not have a limit on the amount of money that a person can receive if successful in their claim. 

While an unfair dismissal claim does have a maximum compensation cap of six months’ salary or wages, provided the amount is no more than 50% of the high-income threshold (which from1 July 2016 is $138,900); therefore the maximum compensation in unfair dismissal claims is $69,450.

Generally, the losses that an employee suffers arising from dismissal include lost income during periods of unemployment, lost income arising from missing out on future promotion opportunities, and losses arising from accepting an alternative lower-paying position found after dismissal. Under the unfair dismissal system, a dismissed employee often misses out on recovering all these losses.

Under the general protections system, a dismissed employee can recover their entire lost income losses without it generally being reduced. Statistically, damages for general protections claims are higher than for unfair dismissal claims.

No Onerous Prerequisites

Unfair dismissal laws have certain qualifying provisions which must occur before the dismissed employee has a right to lodge an unfair dismissal claim.

The first such prerequisite includes a minimum period of service, which is either six months or 12 months, depending on how many employees a business has.

The second prerequisite is that the employee cannot earn more than the high-income threshold(which from 1 July 2016 is $138,900) unless the employeeis covered by modern award or enterprise bargaining agreement.

Thirdly, independent contractors do not have the right to lodge an unfair dismissal claim, whereas independent contractors do have the right to lodge a general protections complaint.

Fourthly, casual employees do not have the right to lodge an unfair dismissal claim unless they worked on a regular and systematic basis,whereas casual employees do have the right to lodgea general protections claim, irrespective of whether they worked on a regular and systematic basis or not.

The above restrictions do not apply to general protections complaints and, therefore, the general protections system is open to more people than the unfair dismissal system.

You Can Recover Penalties

Under the unfair dismissal system, a successful employee is only entitled to compensation at the above capped amount, and also to reinstatement in limited circumstances.

Under the general protections provisions, a successful litigant is entitled to compensation as well as the ability to have civil penalties imposed against the business. A civil penalty is a further payment that the business is required to pay as a penalty for their breach of the general protections laws. 

Some Tips When Dismissing an Employee from a Termination of Employment Lawyer

In Australia, if an employee is terminated unlawfully, then the business can be exposed to various types of claims including unfair dismissal, general protections, or discrimination claims. Therefore, it is important to make sure that the procedures are followed correctly when dismissing an employee.

Valid Reason

An employer must have a valid reason to dismiss an employee. An employee should be notified of the reason for their dismissal before their employment is terminated.

It is best practice to either sit down with the employee and advise the employee of the reason, or send written correspondence to the employee setting out the reasons before the dismissal occurs.

An often relied on reason for termination is redundancy. Redundancy occurs when the employee’s position is no longer required to be performed by anyone. Redundancy is about removing the position and not about removing the employee. The business must also ensure that the redundancy is a genuine redundancy and not a sham redundancy. The business must also ensure that they consult with the employee beforehand and also look for alternative work that the employee may be suited to perform before terminating the employee for redundancy.

Another reason is dismissal for poor performance. Before an employee is dismissed for this reason, an employee must be given a reasonable opportunity to improve. This often means that the employee should be put on a performance improvement plan, and the employee must be advised on what they are doing wrong and how to improve it. A business should not act with too much haste in terminating an employee who is performing poorly.

However, if the employee has been with the business for less than six months, then the employee is not covered by unfair dismissal laws, and their employment can be terminated without giving the employee a proper opportunity to improve. This often is applicable in cases where the employee is on probation. However, if the business is relying on this type of dismissal, it is important to ensure that this dismissal only relates to performance and it does not relate to any other issue which may be unlawful. For example, it is unlawful to terminate an employee because they have made a complaint regarding their employment (which is known as exercising your workplace right).

Another common reason for termination is misconduct. Misconduct can take various forms and can be further classified into serious misconduct or regular misconduct. Serious misconduct is usually an act that is done intentionally, and is often more than just a mere error of judgment. It is misconduct of such a serious nature that it would be unreasonable to continue the employment relationship. Serious misconduct includes things such as stealing from the employer, swearing at the employer, or assaulting the staff.

Regular misconduct includes other wrongdoing by the employee.

Serious misconduct allows the employee to be terminated without notice. In the case of regular misconduct, the employee must be given notice before they are terminated.

Opportunity to Respond

The employee must be given an opportunity to respond before they are dismissed. This is usually done by having a meeting with the employee and giving all the proposed reasons the business intends to rely on to terminate their employment. In other words, give the employee an opportunity to have their say. This can be done at a meeting, or alternatively, this can be done after the meeting, where the employee puts in a written response addressing the proposed reasons.

The business should not make the definitive decision to terminate the employee before they have given the employee a chance to respond.

Document Everything

It is important that the business documents everything. The reason for this is that if the matter proceeds to a hearing, then it can be difficult to establish what was said if it is not in writing. After each important meeting, it is good practice to send a summary of what occurred at that meeting to the employee.

Support Person

If the employee requests a support person, then the business must allow that support person to be present at the meeting. It should also be noted that the support person is not an advocate of the employee but simply attends for moral support. The support person is not authorised to speak on the employee’s behalf.

Navigating the Laws on Unfair Dismissal

The laws on unfair dismissal can be complicated and difficult to navigate. The purpose of this article is to provide some information to help the readers navigate this often complicated system.

No Double Applications

When an employee is terminated, they have the right to lodge many different types of applications, including an unfair dismissal application, general protections application, and even a discrimination application in the Human Rights Commission.

Sections 725 and 734 of the Fair Work Act 2009 specify that an employee can only make one such application if they are dismissed.

If an employee makes two applications, then only one will be permitted to remain active and the others will be dismissed because it contravenes this rule. The policy consideration behind this rule is to minimise the number of claims that the Commission and the courts hear regarding issues involving termination of employment. This rule forces an employee to make a decision on which application they are to commence. Sometimes this decision is difficult, because an employee may, for example, have the right to file both an unfair dismissal claim anda general protections claim.

Cost Orders

The unfair dismissal laws specify that, generally, a party to an unfair dismissal application will have to carry their own legal costs. In most instances, this will be the case. However, there are some exceptions to this general rule which anyone commencing such an application should be aware of.

The Fair Work Act 2009 is the primary legislation which governs the law on unfair dismissal.

Sections 400A and 611 of the Act sets out the circumstances in which legal costs can be ordered to be paid by one of the parties to the proceedings. These sectionsspecify that the Commission can order a party to pay the costs incurred by the other party if such costs arose because of an “unreasonable act or omission” in connection with the unfair dismissal application.

What counts as an unreasonable act may include things such as rejecting a reasonable settlement offer in circumstances where the offer is close to or equal to what a party may obtain if they are successful at trial. In unfair dismissal claims, an employee is entitled to a maximum of six months’ wages or salary, or 50% of the annual high-income threshold, less allowable deductions such as payments made in lieu of notice to the employee.

For example, if the employee is offered six months’ salary less the four weeks’ notice which was paid to the employee in lieu upon termination, this would represent a very generous offer. This would represent the maximum the employee would be entitled to if the employee were successful at the hearing. Therefore, if the employee rejects such an offer, it is likely that the employee would need to pay the employer’s legal costs because a rejection of this offer would clearly fall within the meaning of unreasonable act as specified in the legislation.

Alternatively, if an employee has lodges claim that would be unlikely to succeed at trial and the employee rejects a reasonable offer made by the employer, then if it can be shown that the employee’s case had no reasonable prospect of success at the time that the offer was rejected, then that would also amount to an unreasonable act which will entitle the employer to obtain legal costs if the matter proceeded to hearing.

Costs can also be obtained against a party if they commence legal proceedings which have no basis and are doomed to fail.

The decision on whether or not a case has no reasonable prospect of success must be determined objectively at the time of filing the proceedings. The law specifies that such a conclusion  should only be reached with extreme caution.

Reaching such a finding is generally difficult in practice. A common example where such a finding would be made would be if the employee and the employer reached a settlement agreement under which the employee agreed to release the employer from all claims, including the unfair dismissal claim. If the employee continues with the unfair dismissal claim, then the employee would be running a case that has no reasonable prospect of success (because of the settlement agreement). In this situation, the employee is at risk of having costs ordered against them.

Quick Tips by Workplace Discrimination Lawyers

Anti-discrimination laws in Australia prohibit discrimination based on the protected attributes. The protected attributes include a person’s sex, relationship status, parental status, age, race, disability, political belief, trade union membership, gender identity, sexuality, family responsibility, and pregnancy.

Discrimination can also be separated into direct discrimination and indirect discrimination.

Direct Discrimination

Direct discrimination occurs when a business or a person within the business treats a person less favourably because of the protected attributes mentioned above.

A business refusing to hire pregnant women is an example of direct discrimination.

Indirect Discrimination

Alternatively, indirect discrimination occurs when a person or a business imposes terms which a person with the particular protected attribute cannot possibly comply with, and that which a higher percentage of people without the protected attribute can comply with, and the term is unreasonable.

An example of this would be if an employer requires its workers to wear a uniform which includes a cap purely for appearance reasons and not for hygiene or safety reasons. This is not direct discrimination, but it could be classified as indirect discrimination because it prevents people who have a religious or cultural belief from wearing a particular headdress. In that circumstance, for the business to not be seen as engaging in indirect discrimination, it must allow the opportunity for people to wear a religious or cultural headdress if they so choose.

Motives

It is also important to realise that the motive for treating another person less favourably is not relevant. This is because direct and indirect discrimination can be unintentional or unconscious, and the Commission will not look at the reasons why such behaviour was instituted.

Protection at Work

It is important to remember that the discrimination laws protect workers in Australia while they are at work, while they are applying for work, and while they are attending a work-related activity.

The protection protects both employees and contractors. It does not matter whether the employee is full-time, part-time, or casual – they are all protected. The anti-discrimination law also applies to work performed on a voluntary or unpaid basis, work performed by students conducting work experience, work under an apprenticeship training programme or anything similar.

Some Exceptions for Discrimination on the Basis of Age

There are certain situations where conduct which may be perceived as discrimination may be lawful.

The first common exception is payment of workers who are under 21 years of age. Modern awards, enterprise bargaining agreements, and other industrial instruments often specify a lower pay for workers under the age of 21. It is not age discrimination to pay these workers the lower rates set under these provisions.

It is also not unlawful to institute a compulsory retirement age in certain allowable circumstances. Compulsory retirement age applies to some occupations includingjudges, fire officers, police officers, directors of public companies, members of the Australian Defence Force and some members of the public service.

If a business is intending to institute compulsory retirement, it is important that they obtain legal advice on whether it is lawful. It is only lawful if there is a law in place that justifies compulsory retirement. If there is no such law, then compulsory retirement can amount to discrimination based on age.