There are two remedies available to an employee claiming unfair dismissal under the Fair Work Act 2009 (Cth) (FW Act) – reinstatement (with any required back-pay) and compensation.
Section 390 of the FW Act makes it clear that reinstatement will be the primary remedy and that the Fair Work Commission (FWC) must not make an order for compensation unless it is satisfied that reinstatement of the person is inappropriate.
When considering whether reinstatement is appropriate in the circumstances, the FWC has shown that it will have regard to a number of factors, including the employee’s skills and attributes, their length of service and employment record, as well as the circumstances of the particular matter.
For example, the FWC recently ordered that a bus driver be reinstated to his position despite finding that the bus driver had engaged in “particularly unnecessary and unprofessional” conduct which provided a valid reason for his dismissal (Thomas v ACT Government – Transport Canberra and City Services T/A ACTION  FWC 6167).
The conduct in question concerned a road-rage incident with a car driver during which the bus driver engaged in the following acts:
The employee accepted that his conduct was inappropriate and warranted disciplinary action. He argued however that this was an “exceptional” circumstance and that the disciplinary action should have been something less than termination.
In arguing that its dismissal of the bus driver was not unfair, the employer pointed to the potentially serious consequences of the bus driver’s conduct on its reputation as well as the risks such conduct posed to drivers, passengers and the public. The employer also noted that road rage incidents were not uncommon for bus drivers and that their employees were “trained to avoid and diffuse conflict situations”.
In considering an order for reinstatement, the FWC found that, even though there was a valid reason for his dismissal, there were mitigating factors that were relevant and which made the employer’s response disproportionate to the conduct. The FWC noted that the employee:
It was also noted that, out of the three people that gave evidence for the employer, only one of them said that he had lost all trust and confidence in the employee but that he only interacted with the employee, at best, once a year. The FWC therefore found that the employment relationship was likely to be “bruised” but not beyond repair.
Employers should not operate on the assumption that the only possible consequence of dismissing an employee is to pay them compensation and that this is “the cost of doing business”.
The FW Act requires an FWC member to exercise some discretion when it comes to ordering a remedy. Reinstatement is the primary remedy and should not be discounted as a possible outcome.
When considering termination in the course of a disciplinary process, employers must be certain that the employment relationship is no longer tenable in the circumstances.
Shane Koelmeyer is a leading workplace relations lawyer and Director at Workplace Law. Workplace Law is a specialist law firm providing employers with legal advice, training and representation in all aspects of workplace relations, employment-related matters and WH&S.
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Information provided in this blog is not legal advice and should not be relied upon as such. Workplace Law does not accept liability for any loss or damage arising from reliance on the content of this blog. Where applicable, liability is limited by a scheme approved under Professional Standards Legislation.
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