When does a termination take effect?

In 2019, the Fair Work Commission (FWC) dealt with over 13,900 unfair dismissal cases. And while each case is different, The FWC examines, in some form, the way an employee was dismissed and whether it was fair. Since then, the FWC handed down a decision that has reiterated the importance for employers to engage in appropriate processes when terminating an employee and complying with legal obligations.

In this article, we’ll discuss how important it is for employers to follow correct dismissal procedures, confirm terminations appropriately, and explain when termination takes effect. So, let’s take a look at a case that highlights why confirming the termination date is so important.

Steve Petkovski v M J Luff Pty Ltd T/A Border Express [2021] FWC 5936 

A parcel sorter from Tullamarine, a suburb in northwest Melbourne, was dismissed via an email on 22 July 2021 containing a letter of termination “for serious misconduct, specifically [his] violent behaviour” in a meeting “where [they] had gathered to discuss other misconduct”. This “violent behaviour” referred to the employee’s actions of flying into a fit of rage, swearing, threatening, and damaging a room during a disciplinary meeting. The employee later received a confirmation letter via registered post on 27 July 2021, five days later.

The sorter filed an unfair dismissal claim following his termination. However, as per the statutory 21-day time limit to lodge a claim, the employee was a day late outside of this period, as calculated from the date of his termination was communicated by email. But the sorter alleged that he didn’t receive the email confirmation because he no longer used the email account, claiming that his termination date should instead be 27 July 2021 when he received the letter via registered post.

When hearing the matter as an out of time application, a third possible termination date was identified: when the Transport Workers Union representative told the parcel sorter of his termination on 22 July 2021 during a phone call. The Commissioner determined that in “circumstances where a relationship of agency was established between the [employee] and the [union]…the dismissal to an employee through their representative would constitute communication of the dismissal by the employer”. However, it was established that no evidence suggested such a relationship of agency existed in this case.

Ultimately, the FWC identified that the sorter wasn’t given a reasonable chance to find out he was dismissed on 22 July 2021, due to his inactivity with his email account, although it’s “understandable” the employer sent such an email as they didn’t know it was longer in use. The Commissioner concluded that the employee’s termination didn’t occur until 27 July 2021 when the letter was received by post, and because dismissal doesn’t take effect until it’s communicated with the worker, the employee’s right to lodge a claim within the 21-day time limit was upheld.

When is an employee dismissed? 

Following the FWC’s decision, “a dismissal does not take effect unless and until it is communicated to the employee who is being dismissed”.  Furthermore, an employer cannot terminate an employee’s employment unless written notice has been provided to that employee stipulating the date of termination, which must not be before the day the notice is given (other than in cases such as serious misconduct or for casual employees etc.).

It’s also important to note that once employment has been terminated, it’s best practice, and required by most modern awards, that the employer pays out all relevant entitlements and final pay within seven days of the employment ending.

What to remember

Employers should ensure the contact details they have on file for employees are kept up to date so they can send communications with confidence that they’ll be received. In this case, the employer’s decision to send a second letter by post meant that the employment was found to have eventually been terminated. Employers should also be conscious of who may constitute an employee’s ‘agent’ such as their union or representative.

When delivering important documents to employees, such as final termination letters and notifications, employers should always attempt to confirm with the employee if the document in question has been received.

Citation HR Software can help keep employee records up to date.

With an HRIS system housing your employee data and other important records, you’ll be saying goodbye to paper and embracing technology that allows you to access and update records whenever and wherever you need to. Employees will also have direct access to relevant resources, the ability to maintain and update their information, and acknowledge, report, and action important tasks. See how Citation HR can help your business today.