By Charlotte Harding
We often hear that dismissing an employee can be one of the most stressful and challenging situations in the workplace. Depending on the circumstances, employers may have to manage difficult, emotional or even disgruntled employees, while also have to navigate the complex legal system that governs the termination of employees.
There are a lot of issues to consider when terminating an employee, which can include how to manage any potential misconduct, notice periods, termination payments, probationary periods, award coverage and unfair dismissal.
It’s also important that you follow all the proper, lawful processes when dismissing an employee, and understand your rights as well as the rights of the employee.
Having a solid understanding of the different types of termination, the processes involved and how to minimise your risk can help to reduce your stress.
When does an employment relationship end?
An employment relationship can end in the following ways:
- An employee may resign from their employment;
- An employer may dismiss an employee;
- The employee’s contract may come to an end; and
- The employee’s contract may become “frustrated”.
When it comes to actually dismissing an employee, reasons can include:
- Unsatisfactory performance of an employee;
- The employee doesn’t have the ability complete the work;
- The employee has engaged in misconduct; and
- The job is no longer needed to be performed, and the employee’s job is redundant.
What’s the difference between dismissal and resignation?
It’s important to understand the difference between the dismissal and resignation of an employee as this will affect the steps you need to take before, and after, the employee’s employment ends.
- Resignation – is when the employee decides they want to end their employment.
- Dismissal / termination – is when the employer decides to end the employee’s employment.
How do you terminate an employee for misconduct?
There’s no one-size-fits-all guide on how to terminate an employee: it all depends on the reason for termination and how long the employee has been with you. For example, a termination due to underperformance will differ from a termination for serious misconduct. Likewise, a termination due to a genuine redundancy will require a completely different approach. You can download our Employee Termination Checklist here:
To make the process as easy as possible for you, we’ve outlined some general steps that you should take when terminating an employee for misconduct. Given today’s climate, where claims of harassment, sexual harassment and discrimination are common, termination for misconduct can affect any workplace. Below are the best-practice steps we recommend:
- Gather as much information as you can:
Firstly, gather as much information as you can about the misconduct allegations made against the employee. You should complete this step before inviting the employee to a disciplinary or counselling meeting. Evidence could include gathering witness statements, video surveillance, and collecting any past warnings and copies of workplace policies.
- Hold an investigation interview:
Next, you will need to invite the employee – in writing – to a meeting to discuss the allegations or their conduct. This invitation could be sent to the employee by email or by letter, and you should keep a copy. We also recommend giving the employee at least 24 hours’ notice of the meeting, and invite the employee to bring a support person. This gives the employee time to arrange a support person and gather any evidence they would like to present to you.
Something important to note is that a support person is only there to support the employee and not to advocate on behalf of them. This means that the support person is not able to ask or answer any questions on the employees’ behalf. However, they are allowed to take notes during the meeting, and if the employee wishes to confer with their support person, you should provide a short break to allow this.
In this meeting, you will need to explain what the allegations against the employee are and give them a proper chance to respond to all the allegations and information. Giving the employee an opportunity to respond is extremely important and is not a step you should skip!
- Consider the employee’s response:
Once you have the employee’s version of events, you will need to adjourn the meeting and take time to consider the employee’s response and any other information provided. This step needs to be taken before making the decision to terminate the employee.
In some cases, this may involve preparing an investigation report, containing the relevant facts and whether the allegations are proven on the balance of probabilities.
You might find that, upon reflection, termination may be too harsh, and a warning may be more appropriate. It is important to contact your HR Advisor if you are in any doubt as to the appropriate course of action.
- Schedule a termination/outcome meeting with the employee:
Once the conduct has been established and you decide that dismissal is appropriate, the next step is to invite the employee to a meeting to discuss this outcome. Again, we recommend that you give the employee at least 24 hours’ notice and tell the employee they can bring a support person.
During the meeting you will need to advise the employee of your decision to terminate, and explain your reasons for the termination. Either in the meeting, or shortly after, you will need to give the employee a letter of termination which will also outline the reasons for termination and the notice period that the employee will be given. There are important considerations regarding the amount of notice to be provided to the employee (if any) and whether there are any outstanding entitlements to be paid. (For more on how to calculate termination pay, see our article here).
- Other post-employment considerations:
There are some other things to consider when exiting an employee from the business. These include:
- Ensuring employees return any company equipment they possess;
- Ensuring handovers have been completed, where necessary;
- Reminding employees of any ongoing obligations under their contract of employment, such as those relating to confidentially or post-employment restraints; and
- Ensure the employee collects their personal items.
Ways to minimise your risk
Minimising your risk starts long before the termination process. We find that employers tend to focus on minimising the risk of a successful unfair dismissal claim and not minimising the risk of a claim being made at all. However, there are ways of discouraging claims, and key to this is employees not feeling genuinely hard done by.
Don’t get caught in the same traps as other employers and avoid the common mistakes that can make or break a termination process. The following list outlines some key mistakes people make:
- Not being prepared with all details, evidence, etc
- Not listening to employee responses
- Providing vague feedback
- Being overly critical
- Relying on opinion or personal standards
- Taking it personally
- Leaving it all for the annual review
Don’t let a poorly handled termination come back to bite you. Do your best to avoid the above mistakes. Follow best-practice processes, and seek professional advice when you’re not sure of something, and you’ll be setting yourself (and your business) up for the best possible outcome.
Charlotte Harding is a qualified workplace relations consultant at HR Assured and FCB Group. She has a special interest and expertise in WHS, and has helped many businesses institute best-practice WHS solutions to build safer and legally compliant workplaces.