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Remedies

Information about what can be done if an employee has been dismissed unfairly.

If he Fair Work Commission (FWC) decides that an employee was unfairly dismissed they may order the employer to:

  • reinstate the employee to the same or an equivalent position
  • reinstate the employee and move them to a different part of the organisation or a related entity
  • pay for lost wages between date or termination and reinstatement
  • compensate the employee instead of reinstating them (this may happen if another employee has been hired or where it is otherwise inappropriate).

See ss. 390 and 391—Fair Work Act 2009 (Cth)(opens in a new window)

Compensation

Reinstatement is the principle remedy contemplated by FWC but where this is not possible compensation in lieu of reinstatement can be paid. FWC must take into account all the circumstances of the case including:

  • the effect of a compensation order on the viability of the employer's business
  • how long the employee has worked for the employer
  • money they would have earned if the termination had not happened
  • efforts by the sacked employee to find other work
  • income earned since the termination occurred and reasonably expected up to the time compensation may be paid
  • any other matters.

See s. 342—Fair Work Act 2009 (Cth)(opens in a new window)

Reduced compensation for contributing factors

Compensation can be reduced for factors contributing to the situation. That is, any behaviour of the employee that contributed to the termination. For example, in Heffernan case (link below) the employee's compensation was reduced because it was held that his driving of a fork lift truck contributed to his dismissal.

See s. 392—Fair Work Act 2009 (Cth)(opens in a new window)

How much compensation can be paid?

The maximum amount of compensation payable for employees who are covered by an award is the equivalent of 6 months pay or half of the high income threshold. Thus the lesser amount of:

  • up to half of the current high income threshold (high income threshold is $136, 700 at 29 December 2015)
  • 6 months pay.

The Fair Work Commission may order that the amount of compensation be paid in installments.

More information

Legislation

Fair Work Act 2009 (Cth)

  • Part 3-2—Unfair dismissal
  • s. 387 sets out the factors that Fair Work Commission must take into account when they are making a decision about whether a dismissal is unfair
  • ss. 390, 391, 392—remedies

See Fair Work Act 2009 (Cth)(opens in a new window)

Fair Work Commission

See:

Fair Work Ombudsman

See Fair Work Ombudsman—Ending employment(opens in a new window)

Relevant cases

Contributing factors may reduce compensation payable

See Heffernan v Tabro Meat Pty Ltd [2010] FWA 8192 (28 October 2010)(opens in a new window)

Updated