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Unfair Dismissal

If you have been dismissed from your employment, you may be able to make an unfair dismissal claim.

Unfair dismissal applications can be complicated, so we recommend seeking legal advice from an experienced employment lawyer before making such a claim. Early advice can be particularly important because unfair dismissal matters are subject to strict time limits and eligibility requirements.

What is unfair dismissal?

A dismissal is said to be unfair when it is found to be harsh, unjust, or unreasonable by the Fair Work Commission (FWC). However, not all employees have access to unfair dismissal. Whether a dismissal is unfair will depend on the particular facts, including the reason for the dismissal and the procedure followed by the employer.

Who is eligible to make a claim?

To be able to make an unfair dismissal claim, a person must:

  • have been an employee,
  • have been dismissed at the initiative of the employer,
  • have six months’ service if working for a large employer (15 employees or more). Note that a casual employee’s period of service will not count unless they had a reasonable expectation of continuing, regular and systematic employment.
  • have one year of service if working for a small employer (fewer than 15 employees). Service does not include periods of unpaid leave.
  • have earned below the high-income threshold. From 1 July 2025, the high-income threshold was $183,100. The amount is indexed and goes up on 1 July each year. An employee who earns above the threshold may still make an application if they are covered by an award or agreement.

Eligibility issues, such as award coverage and earnings, are not always straightforward, and the above points often require professional advice.

When to apply for an unfair dismissal

To make an unfair dismissal claim, an employee must lodge an application with the FWC within 21 days of the dismissal taking effect. This deadline is strict. The FWC may extend the time to make a claim, but only in exceptional circumstances. Because of this short time limit, it is usually best to obtain advice as soon as possible after the dismissal takes effect.

How does the FWC determine an unfair dismissal?

In determining whether the dismissal was unfair, the FWC will consider:

  • whether there was a valid reason for termination
  • whether the employee was notified of that reason
  • if the reason relates to performance, whether the employee was given an opportunity to respond to the reason
  • whether the employee was given warnings about their poor performance
  • whether there was an unreasonable refusal to have a support person present in discussions relating to the dismissal
  • the size of the employer’s enterprise and its human resources capacity
  • any other matter the FWC considers relevant.

In other words, the FWC looks not only at the reason for dismissal but also at whether the process leading to the dismissal was fair.

What does dismissed mean?

It may sound obvious, but the employee must be dismissed in order to make an application. Under the Fair Work Act 2009, dismissed means that the employment was terminated at the initiative of the employer. Please note:

  • A person who has resigned is usually taken to have not been dismissed, unless they can show that they were forced to resign. ‘Constructive dismissal’, as it is known, is something frequently raised by employees, but only rarely recognised by the FWC.
  • An employee engaged for a specified period of time or engaged for a specified task and whose time has expired is taken not to have been dismissed.
  • A person who has been demoted and who continues to work is also not taken to have been dismissed unless the demotion is a significant reduction in pay or duties.

If you are not sure if you have been dismissed, seek professional advice.

Jurisdictional objections

A jurisdictional objection is where an employer says that the FWC does not have the power to deal with the dispute. There are several grounds for a jurisdictional objection in an unfair dismissal application:

  • The Application is out of time (i.e., the application has not been made within 21 days).
  • The Applicant was not an employee (for example, they were an independent contractor).
  • The Applicant was not dismissed (i.e., they were not terminated at the initiative of the employer. For example, they resigned.)
  • The dismissal was a genuine redundancy (please refer to Henry Bournes’ redundancy page).
  • The Applicant was not employed for the minimum employment period.
  • The Applicant earned above the high-income threshold and was not covered by an award or agreement.
  • The employer is a small business employer and complied with the Small Business Dismissal Code.

Jurisdictional objections can be critical because, if successful, they may prevent the application from proceeding any further.

Remedies

If the dismissal is found to be unfair, the FWC can order:

  • Compensation, though the FWC can only award a maximum amount of six months’ pay or half the high-income threshold, whichever is less. In awarding compensation, the FWC considers the amount the employee would have received had they not been dismissed, less income earned since termination. The FWC will not compensate for hurt or humiliation, and will also consider whether and to what extent the employee sought to mitigate (reduce) their loss.
  • Reinstatement, though this is uncommon. The FWC indicates that this is awarded in fewer than 1% of applications.

The appropriate remedy will depend on the circumstances of the case, including whether the employment relationship can realistically continue.

Unfair dismissal claims can be difficult to manage on your own. If you require advice or assistance in relation to an unfair dismissal claim, please click ‘book now’ for a confidential consultation with Henry Bournes. This information only relates to employees under the Fair Work Act (Cth) 2009. It is information only and is not legal advice.

Liability limited by a scheme approved under Professional Standards Legislation.