Soon after the last federal election a banner was draped, briefly, from Sydney Harbour Bridge. It proclaimed: ‘Australians have voted to live in an economy, not in a society.’ Within days, the Howard Government announced it would introduce industrial relations changes in Parliament once it had obtained the majority in the Senate. One of these changes would be to exempt from unfair dismissal laws companies with fewer than 20 employees, a number that was later extended to 100. It is just one of many changes the Government intends to make, but the detail of the new legislation is yet to be seen.
The Government says removing unfair dismissal laws will lead to greater workplace flexibility, and has won praise for its plans from the International Monetary Fund. Of course, the downside of such flexibility is that it will remove protection against unfair dismissal for up to 95 per cent of Australian employees. Although the Government’s plans directly affect only those employees covered by federal legislation, it is to be assumed the new laws will override state legislation.
In the main, the existing system provides a relatively speedy, cost-effective and simple process for resolving disputes between employers and employees. Those employees covered by the federal Workplace Relations Act 1996 come under the jurisdiction of the Australian Industrial Relations Commission.
Employees not covered by federal legislation are covered by state legislation, and each state has its own Industrial Relations Commission. Once a claim for unfair dismissal has been lodged in the commission, the matter is listed for a conciliation conference that explores whether it can be resolved by negotiation. If not, the applicant can proceed to arbitration. The commission’s 2003-04 annual report says 75 per cent of cases are resolved at the conciliation stage. Of the remaining cases, 16 per cent are settled post-conciliation, six per cent are abandoned and just three per cent actually proceed to arbitration.
In a nutshell, most unfair dismissal cases concern two main questions: whether the employer has a valid reason for terminating the employee’s employment; and whether the employee was accorded procedural fairness in all the circumstances of the case. Where the employer can demonstrate there has been ‘serious misconduct’ (such as theft, fraud, assault, or being intoxicated at work), there is no need to show that the employee has been warned or counselled; such conduct, if established, warrants summary dismissal. Section 170 CA (2) of the Act provides the