The Federal Governments IR Review is considering proposals to implement penalties onto employees that bring unfair dismissal cases and then fail to actively pursue them, in an effort to address disturbing waste of business and Commission time.

IR Minister Christian Porter in unveiling the key areas of the Review and calling for submissions and discussions outlined that the Prime Minister had clearly articulated criteria for any future changes to the industrial relations legal framework, namely that; any change would create jobs and put an upward pressure on wages; any change would help boost productivity; and any change would demonstrably help the overall economy to grow.  Outlining that if any proposed changes did not meet these criteria they would not be implemented.

Based on these criteria, and the engagement of stakeholders, key issues areas have been selected for discussion papers.  “There have been many recurring themes – complex awards, complex agreement requirements, delayed resolution of disputes, unpredictability of decisions, inconsistent levels of compliance, lack of flexibility, inconsistent meanings of casual employment, inconsistent codes dealing with small business dismissals” explained the Minister.

While the impact of recent court cases on casual status and further cases on the application of paid leave entitlements to all staff remain key areas of focus, it is noted that there is also to be a focus on exploring solutions to the issue of employees commencement of unfair dismissal proceedings with no intention or action to pursue them properly.  This practice is a draw on the time and resources of the businesses that are required to respond as well as to the Commission, and ultimately to all taxpayers, and has been categorised by some commentators as a perversion of the system.

“If someone takes a claim for unfair dismissal to the Commission, it is reasonable to expect that they are serious in that claim and are actually prepared to present their case and co-operate with the requirements of the Commission.  Failure to properly pursue a matter, once commenced, and without formally withdrawing the claim means wasted resources, funded by the taxpayer – plus an unfair burden on the small business employer that has to spend precious time and money to defend a non-pursued claim to its conclusion” the Minister outlined.

This is a pattern ACAPMA is familiar with, as Elisha Radwanowski, outlines; “We have been assisting more and more Members with responding to unfair dismissal claims where the Applicant (or employee) has refused to participate in the Conciliation phase of the process or has actively frustrated its success, resulting in the Matter proceeding to the Hearing stage.  As part of the Hearing process Applicants are required to produce documents in accordance with the Commissions Directions (as is the Respondent or business), however, our Members are often faced with situations where the employee simply does not meet these requirements and fails to submit documents. 

“In such instances Members are understandably confused as to why the Matter is not immediately dismissed at that point given the employee has failed to follow instructions and failed to therefore prove their claim.  However, what happens instead is a series of contacts from the Commission to the employee seeking the documents or discussion about when they will be received.  If that process is not fruitful then another Hearing is listed to offer employees another chance to submit, an approach that is out of balance, as if the business failed to meet a single deadline the Matter would proceed immediately to a final Hearing with no further contact.  All of these elements take time and effort and cause a great deal of stress for the Members”. 

In a recent case that ACAPMA assisted with; the employee initially lodged the claim for unfair dismissal in an incomplete fashion and was allowed to lodged further documents after the initial claim.  A formal response from the business was produced and submitted.  The Conciliation hearing date was set and the business attended, only to have the employee not appear.  The Matter was then listed for Hearing and a timetable for the submission of documents was ordered.  The business spent significant time, effort and money producing documents, however the employee did not submit documents in accordance with the Commissions directions.  Two further Hearings were held before the employee submitted documents that were again lodged incomplete and late, resulting in reduced time to prepare a defence by the business.  Travel to the Hearing for the business and the Commission was arrange booked and undertaken and on the eve of the Hearing, at literally the eleventh hour, the employee withdrew the claim.  Other than the filing fee paid by the employee there was no cost or effort on their part in brining a claim that they not only did not pursue according to the Commissions Directions, but that also lacked fundamental merit and involved serious safety breaches and gross misconduct.  The business and the Commission however, invested significant time, effort, resources and money in catering to, preparing for and addressing this claim.

“It is important to have a system that facilitates employees with a genuine claim, and a genuine interest in pursuing that claim, in having that claim heard and determined by a professional and impartial Commissioner.  However, the current system places an undue burden on the business in the sadly common event of employees bringing claims with no or little merit, and no genuine interest in pursuing them, beyond the deliberate causing of stress and effort to the business.  It is understood that achieving a balance will be difficult, but it is hoped that the exploration of penalties for such non compliance on the part of the employees will result in fewer of these hurtful and wasteful spurious claims” notes Mrs Radwanowski.

Unions argue that the proposed penalties will create a situation where employers will feel empowered to dismiss employees without following due process, knowing that there are more hurdles to proving an unfair dismissal case.

ACAPMA will be participating in stakeholder engagement on this issue and will keep Members informed.