End of probation terminations – the timing really matters…

A recent Federal Court decision emphasises the importance of timing when dismissing an employee during probation.

The case is also important because it considers when a dismissal preventing an employee from becoming eligible to apply for unfair dismissal can contravene the general protections rights ?in the Fair Work Act.

The Facts

The Australian Federation of Islamic Councils employed a CEO in September 2023.

On 9 August 2024, the CEO was notified of allegations of sexual harassment of a female colleague and was stood down. ?An investigation was commenced, in which he substantially disputed the allegations.

Although the investigation was not finalised, the employer’s executive committee arranged a meeting on 2 September 2024 and decided to terminate his employment.

The employer was a small business, and so the CEO was only eligible to apply for unfair dismissal from 4 September 2024 which was 12 months after his employment commenced.

The termination was notified by an email sent at 4.40pm on 3 September 2024, only 7 hours before he would have been eligible to lodge an unfair dismissal application.

The Decision

The Court found that:

1. There was a strong inference that a decision was made to dismiss the CEO before 4 September, when he would have been eligible to make an unfair dismissal claim.
2. There was a 'prima facie case' that this was unlawful adverse action to prevent his exercise of a future workplace right to apply for unfair dismissal.

The Court made an order reinstating the CEO to his former position, until a final hearing of the case.

Implications

Although the case has not yet gone to final hearing, a clear implication is that an end-of-probation dismissal occurring immediately before an employee becomes eligible to make a claim for unfair dismissal is at greater risk of contravening the general protections provisions of the Fair Work Act.

Employers should carefully consider when end-of-probation processes are arranged to occur.

At WorkLegal our experienced team can answer your questions and put you on the right track.? A range of fixed-price Initial Consultations will suit most people’s needs in quickly learning what their options are.

Some more information is available here or you can book an initial no-obligation chat online to review an employment contract or contractor agreement.