By Emilia Palka

For most employers, facing the prospect of terminating an employee’s employment is often unfortunately an inevitable part of an employment relationship, and can be awkward, emotional, and risky if not done correctly. If the termination process is not conducted in a manner that aligns with the requirements under the Fair Work Act 2009 (FW Act), employer’s open themselves up to an array of potential claims including breach of contract or unfair dismissal.

While there is not a one-size-fits-all approach when it comes to termination since the process will differ depending on the individual circumstances, in this article we explore best-practice considerations all employers should follow when enacting a termination.

How do you terminate an employee?

1. Gather all available information

Whether the termination relates to poor performance or misconduct, the first step in the process is to gather all the evidence.

In relation to poor performance, it is incumbent of an employer to assess the individual’s performance against the expected standards of the role and collate this information, including highlighting the employee’s shortcomings. Depending on the severity of the poor performance, you may consider placing your employee on a performance improvement plan (PIP). The purpose of the PIP is to support your employee to meet the expectations of their role.

In relation to misconduct, it is important to determine the precise nature of the misconduct, i.e. has the employee engaged in theft, or is it a case of the employee being accused of bullying behaviour? This may involve gathering witness statements or viewing video surveillance footage, with the primary goal being to determine the particular details of the misconduct. Depending on the nature of the alleged misconduct, you may even be required to conduct an investigation.

2. Invite the employee to a meeting

Once you have exhausted the PIP process and the employee’s performance is simply not improving, or you’ve finalised the investigation which has concluded that your employee has engaged in misconduct and therefore you have decided to terminate the employee’s employment, the next step in the process is to invite the employee to a meeting. This is commonly referred to as a show cause meeting. The show cause meeting provides the employee an opportunity to show cause as to why their employment should not be terminated.

During this meeting you will put the precise reasons as to why the business is currently considering the termination of their employment, i.e. for ongoing poor performance or established misconduct and allow the employee an opportunity to respond.

It’s important that you invite the employee to the meeting by providing at least 24 hours’ notice and offer them the opportunity to bring a support person. The role of the support person is not to advocate on the employee’s behalf but to provide emotional support as needed.

3. Review and consider the response

After providing the reasons why you’re considering terminating the employee’s employment, you must allow the employee an opportunity to respond. It may be that the employee provides a genuine reason and/or mitigating factors to support the continuity of their employment. Whatever response is provided, you must genuinely consider this. It is recommended adjourning the meeting to allow you the opportunity to genuinely consider the employee’s response. It may be sufficient to adjourn the meeting for 15 minutes, or you may need to adjourn the meeting for 24 hours, depending on the employee’s response provided.

4. The outcome

Once you’ve considered the employee’s response and made the decision to terminate, you’re required to reconvene the meeting to deliver the outcome. You must provide clear and unambiguous reasons for why you have decided to end the employment relationship.

You must remember that an employer is prohibited from terminating an employee’s employment unless the appropriate notice is provided. The National Employment Standards prescribes the amount of notice which is owed to an employee. However, be careful to cross-check this against the employee’s contract of employment which may prescribe for a more generous entitlement. As the employer, you may choose to have the employee work out their notice period or you can decide to pay the employee in lieu of notice.

How to calculate termination pay? Read our article about Australian employee termination pay and entitlements in our related article here.

5. Other post-employment considerations

There are also a number of considerations employers must take into account when exiting an employee from the business and include:

  • Ensuring employees return all company equipment, such as keys.
  • Ensuring handovers have been completed where necessary.
  • Reminding employees of any ongoing obligations under their contract of employment, such as those relating to confidentiality or post-employment restraints.
  • The collection of the employee’s personal items.

In part 2 of this series, we deep dive into summary dismissal, what it is, and we point out all the risks. You can read this article here.

Are you thinking of terminating an employee? Clients of HR Assured can contact the 24/7 Telephone Advisory service to immediately speak with an experienced workplace relations consultant.

Not an HR Assured client? If you’d like more information about the benefits of becoming an HR Assured client, contact us today for an informal chat.

Emilia Palka is a Workplace Relations Adviser who is currently studying for a Bachelor of Laws/Arts (Honours) at the University of Queensland. Working from HR Assured’s Brisbane office, Emilia is passionate about human rights and diplomacy, which together, drive her eagerness to ensure that employment settings are thriving.