Table of Contents
Unfair dismissal is a situation in which a worker is discharged from their work in a harsh, unfair or perverse manner. Unfair discharge, also known as unfair termination or unfair dismissal illustrates a situation in which a worker’s contract of employment is terminated by the employer in such a way that the dismissal violates one or more of the contract terms. It follows that the extent of unfair dismissal varies depending on the terms of employment contract as well as on the jurisdiction. The lack of a proper contact of employment does not prevent unfair discharges in jurisdictions in which a de facto contract subsists by virtue of employment relationship.
Terms of a contract may perhaps comprise worker’s rights and obligations in a worker handbook. The following terms constitute unfair dismissal:
Retaliation: An employer cannot send home a worker because he or she has filed a claim of unfairness or is taking part in an inquiry for discrimination. In the U.S, this retaliation is prohibited by civil rights laws.
Employee’s refusal to commit an illegal act: An employer is not allowed to send home a worker because the worker has denied committing an illegitimate act.
Discrimination: An employer cannot terminate employment of a worker because the worker is of a certain nationality, age, sex, race, religion, or in certain jurisdiction, sexual orientation.
Employer is not following own termination procedures: In most instances, the worker handbook or company regulations draw a procedure that should be followed prior to a worker’s termination. If an employer sends home a worker without following this procedure, such worker has a right to claim an unfair dismissal and receive compensation for it (Hepple et al 2004).
In Australia the term wrongful discharge is more frequently used to illustrate an illegitimate dismissal. This term is used in the United States for illustrating an illegal or illegitimate termination. A worker may claim wrongful dismissal when he/she is terminated on grounds that appear unjust to the worker, but do not necessarily infringe any laws (Batten 2011). Reasonable grounds for dismissal generally include constant poor performance or dismissal for causes such as a situation when a worker steals or undertakes another illegal act.
The research question is based on the topic of the paper. The research question of this paper is:
Comparative unfair dismissal laws: assessing Australia and the United States.
Comparing Australian and American Unfair Dismissal Laws
In the United States, there is no distinct law for unfair dismissal. Instead, there are numerous federal and state laws as well as court rulings that regard this notion. Sometimes, employers delegate their workers to be ‘workers at will.’ Even in such cases, however, it is normally considered an ‘unfair dismissal’ to terminate a worker on lawfully forbidden grounds. Unfair termination has become the most widespread labour claim in the United States (Hepple et al 2004).
Even though claims of common law violation of employment contract exist in Australia, the Fair Work Act of 2009 offers protection against unfair terminations (Hagglund and Provis 2005, 65-86). The Act, which also provides protection against discrimination at the workplace, took place of the Workplace Relations Act of 1996. A single example of the FWA’s extended reach is its coverage. By expanding protection from unfair termination to the earlier excused firms comprising of less than 100 workers, the Act covers an additional 4.3 million employees. The Act’s central protection from wrongful termination applies to employers with 15 or more workers and does not allow terminations that are unkind, unfair or perverse (Bronstein 2009).
Employers have a task of establishing that a termination was not malicious, unfair or perverse. They should rely on a non-exhaustive set of aspects in order to determine it: whether there was a suitable ground for the termination that is related to the employee’s conduct or his/her capacity; whether the employee was informed of that reason; whether the individual was offered a chance to react to any problem related to his/her conduct or capability; if the termination is caused by a substandard performance of the employee he or she should be been warned prior to the dismissal and any other issues that the Fair Work Commission deems relevant (Riley and Sheldon 2008).
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Under this legislation, in addition to necessitating an adequate work-related reason for the dismissal, an inquest into whether the termination was unjust lies heavily on the existence or nonexistence of given procedural protectors. Workers are not sheltered by the unfair dismissal provision up to the time they have worked for the employer for six months. In addition, some categories of workers like the trainees, workers on fixed-term contracts as well as those who earn high salaries are not included in the claims of unjust termination (Hepple et al 2004).
The United States is short of any national unfair termination protection. A single state, Montana, consists of an unfair dismissal law; every other state utilizes the at-will default regulation. The state is short of any permitted severance or redundancy obligation, leaving such benefits to the employer’s judgment or parties’ accord. It does not also offer protection, although restricted, for workers subject to collective terminations. The federal WARN Act necessitates employers consisting of more than 100 workers to offer at least 60 days’ notice to the workers, unions that stand for the affected workers, and government officials prior to a given plant or firm closing and mass dismissal (Sims 2001). A qualified firm closure is restricted to circumstances whereby at least 50 workers will lay off over a 30-day period, and a qualified mass dismissal entails job losses for either 500 workers or up to one-third of workers over a 30-day period.
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Nevertheless, as compared to Australia, the WARN Act call for the employers to discuss with the workers or their representatives before putting into practice a collective termination. The United States is comprised of a national unemployment protection, but the extent of benefits can differ quite a bit among the individual states (Forsyth 2009, pp. 723-731). This is due to the fact that when unemployment system was instituted in 1935, it formed a joint federal state-scheme that persuades states to establish their agendas.
In general, Australian administration imposes employment termination laws proficiently. To start, lack of a justifying situation, a dismissed worker has only 21 days to forward a claim of unjust termination. Claims should first be brought before the Fair Work Commission, even though they can eventually be brought to a court case in federal court. The Fair Work Commission then tries to resolve the disagreement in a process of pacification related to mediation. The vast majority of dismissal cases filed with the department is resolved at, or prior to the phase of reconciliation (Forsyth and Stewart 2009).
The United States is exceptional and is short of an extensive protection against termination without cause. Despite the fact that due to the numerous exceptions to the United States at-will default and the restrictions on other states’ unfair termination protection, there are fewer differences between the United States and Australia. The area in which the United States is truly outstanding is its enforcement system that is characterized by a low likelihood of workers winning cases involving employment, but usually offers high awards in instances where such cases take place. Workers are in most instances far more successful in undertaking court cases in Australia, but the compensation for damage and awards are considerably lower as compared to the United States (Gilliver-Smith 2003, pp. 112).
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Developments in the Law on Unfair Dismissal
The employment at-will principle, a creation of formalistic contract principle and laissez faire economic theory have customarily been a crucial structural aspect of the employment relationship in the U.S. The policy offers that in a lack of certain contractual restrictions an employer is liberated to dismiss a worker for a good cause, a bad cause, or at no cause. A number of advances in the law on unjust termination in the United States, however, defy the sustained vigor of the employment at-will principle (Odeku, K 2014). To begin with, several state and federal laws forbid employers from terminating their workers on some grounds like sex, colour, race, national origin or age. Secondly, the judiciary has been vigorous in restricting the prudence of an employer in termination cases. When compelling actions forwarded by workers claiming that the employer violated a contract by terminating them, some state courts make use of oblique agreements of good faith and just dealing in a bid to restrict the operation of the employment at-will principle. Other courts find employers accountable in tort for breaching public rule when they dismiss workers devoid of a legitimate cause (Southey 2010, pp. 81-102).
Finally, under most procedures of complaint negotiations in the United States, an employer cannot terminate a worker except where there is a just cause for the termination. This is in essence an unswerving challenge to the employment-at-will principle in the extent at which an employer must stick to the requirements of a collective bargaining accord in regards to the terms and conditions of a bargaining element member’s employment. Nearly all of the collective bargaining accords guarantee that a termination is for fair cause only by offering a multistep complaint declaration scheme that concludes in fastening negotiation between the parties (Robbins and Voll 2005, pp.76-87). These strides in law of unfair termination in the United States alleviate some of the penalties linked to the principle of employment-at-will. The law remains insufficient due to its non-systematic nature. For instance, non-unionized private sector workers are subject to random terminations under the employment-at-will principle if they find themselves outside of the defensive shield of the aforesaid legal and judge-made protection. This state of affairs creates a discrepancy between the substantive rights of workers that are safeguarded by collective bargaining accords and those workers who are not shielded.
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Currently, Australian dismissal laws have become more worker-friendly, covering a broader range of workers and making the employers safeguard terminations (Chelliah and D’Netto 2006, pp. 483-495). Furthermore, the country’s dismissal law offers the victims of redundancy termination with exceptional benefits provided they worked at a bigger enough form, and necessitates a particular procedure for collective termination of 15 or more workers. The state also offers a distinctive program of unemployment assistance that aims at assisting the low-income families with unemployed family members. Remarkably, the great majority of workers in Australia are contended with the application and enforcement of the laws that govern termination.
Case Studies of Unfair Dismissal
CASE 1(MATTER NO. IRC 1146/2003): The applicant started work as a casual worker with a local branch of a nationwide removalist firm in December of 1997 and became an ordinary casual worker in 1998. She undertook her work habitually, permitting for recurrent variations for the firm until late January 2003. During this time, she grew to become very competent and had gained experience with the firm and began to be well thought-out for being a good employee. She also grew quite sociable with the branch manager. Gerry Voll 542 AIRAANZ 2005 the applicant had in some years undergone through workplace aggravation from a fellow casual employee and reported the matter to the branch manager, who ultimately terminated the insulting worker.
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In early February 2003, the branch manager was dismissed and this turned out to be a subject of an unjust dismissal claim before the AIRC. The applicant anticipated to be notified to report to work on 4th of February 2003, but that did not happen. A few days after the inquiring, she was told by a fellow worker that the State Manager had ordered that no friends of the dismissed manager would be employed. The applicant deduced that a new branch manager would soon be selected and since she had knowledge of the individual, the applicantdecided to wait until she took over in order to verify whether she still had a job with the firm or not (Wilcox 2008, pp. 79-84).
The new manager took over on 18 February the same year and the applicant was told by the branch manager that she did want to get involved in the supposed termination of the applicant. It was at this point that she finally acknowledged that she had been terminated and made an unjust termination claim. At the preliminary pacification hearing, the respondent employer, who was not represented, refused the allegation that the worker had been terminated and upheld that she was a casual worker who was still on the firm’s records as a casual worker, but had not been called to work since other casuals were there to cover. The respondent also refused the claims concerning the conversations he claimed to have had in regarding the applicant. The end result was that the commissioner established that the applicant was a long-term casual worker and had a right to make an unfair termination claim, but discharged the out of time claim hence the claim could not carry on.
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CASE 2: A bank manager who violated the trust of AIB Bank and was dismissed, has won the case for unreasonable termination and was rewarded €25,000. According to the Employment Appeals Tribunal, the action of Maher Declan of Clifden, Co Galway, summed up to ‘a clear conflict of interest’ and necessitated a grave sanction, but not termination. The Tribunal granted him €25,000, but decided that Declan’s behaviour was so egregious as to necessitate a considerable cutback in the amount compensation that was supposed to be paid to him. The Tribunal, in a session in Galway earlier this year heard that following a widespread internal examination, AIB ruled that a letter printed by Declan as bank manager of AIB Clifden was a letter of permit for a 60 million dollar loan in principle to a firm of which he was a joint owner.
Until the time of his termination in 2011, Declan had worked for AIB for 28 years. His termination followed an inquiry of the letter he wrote in April 2005, specifying the availability of finances to BMB Partnership for a property transaction in the United States. AIB’s manager of operations who evaluated the case resolved that Declan was involved in illegal departures, violated his duty of fidelity and trust to the bank, and exposed the bank to possible financial losses. Declan denied the allegations and said that the letter was meant for a loan sanction, asserting that it was a marketing letter meant to draw a new business to the bank from the investors who had interest in Florida. The Tribunal was content that the violation of trust and the clear disagreement of interest necessitated a solemn sanction, but not a dismissal. Therefore, it concluded that Declan was unfairly terminated, but his behaviour was so egregious as to necessitate a cutback in the degree of compensation awarded (Wilcox 2008, pp. 79-84).
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Research and Arguments
Workers usually do not make unfair termination claims at a time when they are terminated. This is due to the fact that they do not possess the facts and information regarding the system and to a certain extent due to a sense of hopelessness as compared with the employer. Also, some workers acknowledge and comply with the grounds for termination. Therefore, if the applicants do not receive a representation and advice, some of them cannot carry on with their claims. These workers also find it complicated to acquire better advice concerning how to react to termination, how the system both at federal and state level function, their opportunities for success as well as their potential remedies present. In general, the only way to receive advice is if a worker is a member of a union.
After investigating the issue of unfair dismissal, this paper recommends that the United States and Australia create an all-inclusive law that would allow all of the workers to confront the property of their terminations in a practically fair and consistent way. In devising such a law, legislators must keenly assess the experiences of the British law. In Britain, the devotion to a purpose typical of rationality and commonly a greater apprehension with the substantive fairness of a dismissal would set right several of the many shortfalls now linked to the operation of the unjust termination law. It is also recommended that the workers and small businesses in Australia do not overestimate the opinion of costs and the real costs that are linked to cases of unfair termination.
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The United States employment relationships remain persistently dismissible at will. Nevertheless, there are several statutory and common-law exclusions to the at-will evasion rule. The exclusions together with a chance for applicants to gain access to the civil courts without losing all of their resources and opportunities to recover the outsized grants advocate that the U.S has an option system of employment dismissal statutory in which employers internalize the considerable costs of non-compliance with employment law by formulating a de facto cause system. Two points can be deduced in relation to the procedure that is demonstrated in the case studies. The first is that the procedure involved in unjust termination is not difficult and that most employers are capable of concluding affairs with no representation. Secondly, reinstatement of the worker is seldom offered as a solution, where there is any proof that the employment relationship has been broken.