Building on the HR Highlight Series on Unfair Dismissal, this week in Part 4, we will explore the two very different pathways that will need to be followed after the Conciliation Conference…either processing a Settlement, or preparing for Hearing. We will also explore the options for negotiating an out of session Settlement.
Unfair Dismissal Process Review
As outlined earlier in the series on HR Highlights on Unfair Dismissal, Part 1: A Fair Dismissal (procedural fairness) https://acapmag.com.au/2020/07/hr-highlight-unfair-dismissal-series-part-1-what-does-fair-dismissal-look-like/ and Part 2: Claim of Unfairness (responding to a claim) https://acapmag.com.au/2020/07/hr-highlight-unfair-dismissal-series-part-2-claim-of-unfairness/, when an employee believes that the end of the employment relationship was unfair they have the right to lodge an unfair dismissal claim. As explored in Part 3: The Conciliation Conference https://acapmag.com.au/2020/07/hr-highlight-unfair-dismissal-series-part-3-the-conciliation-conference/ when a claim is received the Conciliation Conference is touted as the last point at which the parties can come to an agreed Settlement before the matter is passed to a Hearing and a Commissioner will make a decision and someone will be at fault.
Conciliation Conferences will either result in a Settlement or in a continuing dispute…one that is on its way to a Hearing. This weeks installment will focus on the steps to take after a Conciliation Conference in both of these outcome scenarios.
As touched on in Part 3, if there is a settlement reached in the Conference the Conciliator will offer to issue the standard Fair Work Commission Deed or Terms of Settlement, which is a legal document that outlines the agreement.
All Settlements reached at Conciliation Conference stage are “no fault” which means that just because there is a settlement does not mean that the business did anything wrong, or accepts any liability.
The Deed also covers confidentiality and mutual non disparagement clauses.
1. Review the Deed
- Once the business receives a copy of the Terms of Settlement from the Concilliator care should be taken to review the terms to ensure that they reflect the agreement, and if they do not then the Conciliator should be contacted urgently to address this.
2. Sign the Deed
- Once satisfied that the Deed reflects the agreement the Deed should be signed and returned to the Employee (and the Employees Representative if they have one). There is no need to provide the Deed to the Conciliator.
3. Receive the Signed Deed
- The employee may sign the copy of the Deed that the business has already signed, or may sign a “clean” copy – either is fine. The Terms of Settlement are noted as being able to be signed in “counterparts” which means as long as the business (and the employee) has a copy of the Deed signed by itself and a copy signed by the employee (even if they are two different pieces of paper) then the Deed is counted as signed by both parties.
4. Process the Settlement
- Once the Deed has been signed by both parties (see above) the settlement items will need to be processed.
- It is important to note that the agreed Settlement is dependent on the business providing the items that were agreed, in the timeframe that was agreed. If the business fails to provide the agreed items, then the Settlement will be void and the unfair dismissal claim will proceed to Hearing.
- Processing Monetary Settlement – If the settlement was a monetary amount, then this will need to be processed through the payroll system. It is important to note that the Deed will usually state if the settlement amount is to be “taxed as a termination payment” or “taxed as a wage payment” and that the appropriate taxation as reflected in the Deed must be applied. Settlements should be recorded in the wages system for the employee but should show on the payslip as Settlement, and must not be used to reduce any other unpaid entitlements (like annual leave). A copy of the payslip and proof of payment should be provided to the employee (and the Employees Representative if they have one).
- Processing Non Monetary Settlements – if the settlement was for something that was not money, such as a Statement of Service or a Reference, this should be prepared and checked to ensure that it is in line with the terms of the Deed. Often the Deed will call for Statements of Service that do not make mention of the reason for the employment ending. It is important that the documents are provided to the employee (and their Representative if they have one) as outlined in the Deed.
Settlement … Notice of Discontinuance
After the Settlement is Processed the Employee should complete the Form F51 – Notice of Discontinuance, to alert the Fair Work Commission that the claim is now settled and no fuhrer action is needed.
The employee is supposed to copy the business on this communication, though it is very common for the employee to forget. The business should not be concerned by this. A note should be made however, if the business receives further correspondence from the Commission on the Matter that has settled, that it would be appropriate at that time to communicate to the Commission that it is the businesses understanding that the Settlement was signed and processed and that the Matter is closed. This will allow the Commission to pursue the employee for completion of the Form F51 to close the matter.
The business should not chase or hassle the employee for a copy of the Form F51.
No Settlement…what now?
As covered in Part 3, if the parties can not come to an agreement on a settlement, then the Conciliator requests information on “preferences” for a Hearing and goes onto have the matter Listed before the Commission.
1. Await Listing
- It will be some time between the Conciliation Conference and the receipt of a Notice of Listing for the Hearing. How long will depend on many factors, including the location of the employee and the number of cases currently before the Commission. It could be a matter of days or weeks before the business receives the Notice of Listing.
- The Notice of Listing for Hearing is similar to the Notice of Listing for Conciliation Conference, it will outline the steps each party needs to take and by which date, and will come with some links and instructional information to allow the business and employee to comply with the requirements.
- In some localities the business may receive a Notice of Mention, where the a teleconference will be held by a Commissioner to explain to the parties what needs to happen, who needs to do what and by when. This is not always the case, many Hearings go straight to Listing without Mention.
- While the business is awaiting the Listing it should commence preparing for the Hearing, by gathering information and reviewing the Unfair Dismissal Benchbook – which is a resource from the Fair Work Commission that aims to inform parties about the process and requirements of a formal Commission Hearing on Unfair Dismissal.
2. Processing the Listing
- Once the Notice of Listing has been received the business should take pains to ensure that it clearly understands the timelines it is required to meet, the evidence it will be required to produce and the arguments (including any relevant legal arguments) it is going to need to make.
- If the unfair dismissal case has Jurisdictional Objections or is of a complex nature it may be appropriate at this time for the business to seek legal advice, and if appropriate, seek permission to be represented by legal council (noting that the right for representation is automatic if the representative is from the business registered Employer Organisation – like ACAPMA, or from the employees registered Employee Organisation – like a Union – otherwise legal representation has to come with permission of the Commission).
3. Out of Session Settlement?
- There remains the option for the business and the employee to come to a settlement anytime before the Commission Hearing actually starts, in fact the Commission encourages the parties to come to an agreement if at all possible.
- The business should use caution when tabling a settlement offer and should ideally start with an email – clearly noted as “Without Prejudiced and In Confidence” – that starts by outlining that the last offer of the business is still on the table (or a different one if appropriate) and that the business is willing to enter into further settlement discussions via email in the interests of saving the time of the Commission if the employee is amenable.
- Any such settlement offer should be sent to the employee AND to the Employees Representative if they have one. These should not be sent to the Commission or to the Conciliator.
- It is strongly recommended that any settlement that is agreed this way is formalised using the standard Fair Work Commission Deed of Settlement to ensure both parties are protected.
- It is also strongly recommended that after any out of session settlement agreement is made and executed that the business ensure that the employee provides the business and the Commission with the completed Form F51 Notice of Discontinuance.
Next Step: Preparing for a Hearing
If the Matter has been Listed for Hearing, and there is no outlook of settlement occurring out of session the business needs to prepare statements and papers to provide as outlined in the Listing prior to the Hearing date and prepare witnesses for the Hearing. This, thankfully, rare occurrence, will be the focus of Part 5 of this HR Highlight Series on Unfair Dismissal next week.
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Elisha Radwanowski BCom(HRM&IR)
Executive Manager for Employment and Training