sat down with a top employment lawyer to find out.
Bryony Binns, partner at Baker & McKenzie, said that there is an idea among employers that in order to terminate employment, they have to have first given three warnings.
“It is correct that employers need to go through a process before terminating an employee in order to meet a potential unfair dismissal claim (and as a matter of best practice),” Binns told HC
“However, there’s no legislative requirement or any decisive judicial statement to suggest that three warnings are required in all termination scenarios.
“At best, giving 3 warnings might be considered best practice in particular scenarios, although this number of warnings may not be appropriate in every instance.”
Binns added that employers should be careful not to “pigeon-hole” themselves into any particular pre-termination process – they should simply be ensuring that their dismissal processes are procedurally fair at a more general level.
“Whether or not the number of warnings given prior to termination is fair should depend entirely on the individual circumstances,” she said, adding that confusion often arises around what needs to occur in terms of the different procedures applied to terminations for inappropriate conduct, as opposed to poor performance.
“With a performance-related termination, and from an unfair dismissal perspective, the Fair Work Commission expects the employee to have been put on notice of their poor performance, given a reasonable opportunity to improve, and given support and feedback so they know how they’re doing along the way – these employees must be given the opportunity to succeed before being written off as a failure,” Binns explained.
“With conduct-related terminations, the process required for a fair termination may be a little different.
“Sometimes the relevant conduct is so egregious as to warrant instant dismissal – that is, without multiple warnings not to repeat the conduct. Of course, the employer must put the individual on notice of their alleged misconduct, and provide the employee with an opportunity to respond before taking steps to terminate, and make sure that they go through the procedure properly.”
Under the Fair Work Act, the Fair Work Commission will consider the following when deciding whether a dismissal was fair – and Binns suggests the criteria be used by employers instead of a ‘three strike’ approach:
- Whether there was a valid reason for the dismissal related to the person's capacity or conduct (including its effect on the safety and welfare of other employees)
- Whether the person was notified of that reason
- Whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person
- Any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal
- If the dismissal related to unsatisfactory performance by the person – whether the person had been warned about that unsatisfactory performance before the dismissal
- The degree to which the size of the employer's enterprise would be likely to impact on the procedures followed in effecting the dismissal
- The degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal
- Any other matters that the FWC considers relevant.
“Any employer’s termination policies should be drafted so that they provide sufficient leeway for the employer to deal with the circumstances based on the facts, at their discretion,” Binns continued.
“They must also give the employee the opportunity to explain their actions. In an unfair dismissal case, it is expected that the individual was given the opportunity to respond.”
She added that when deciding whether or not to dismiss an employee, employers must consider the nature of the conduct as well as other things that impact on whether a termination may be harsh, unjust or unreasonable.
“These factors include things like the length of the employee’s service, their track record and whether or not other employees have engaged in similar behaviour – and what discipline those other comparable employees have been subjected to,” Binns said.
“It’s also important to consider that having a ‘three strike’ might give employers a false sense of security over the fairness of a termination – particularly if the three warnings involve different types of inappropriate conduct over a lengthy period of time.
“Relying upon prior events like this is risky unless the employer has gone through a proper and fair procedure in relation to the last event triggering the termination decision, and that trigger event is sufficient to warrant termination.”
Overall, Binns was sceptical over using a ‘three strike’ approach to employment terminations.
“The necessity of a ‘three strike’ rule is a bit of an urban myth,” she told HC
'But you haven't given me three warnings!' - it's a phrase many HR managers would have heard from aggrieved employees during disciplinary meetings. But does this commonly held belief hold any real legal weight?