Summary Dismissal: What is it and What Does an Employer Need to Consider?

Author: Megan Adams & Petro Kaloterakis, Progressive Legal

Whether you’re an experienced business owner or just starting out, a clear understanding of summary dismissal is essential for fostering a positive and legally compliant workplace.

On this page, we’ll unravel the concept of summary dismissal, provide valuable insights into what summary dismissal is and the cover the basic knowledge employers need.

What is summary dismissal?

Summary dismissal is a serious and immediate termination of an employee’s contract due to a severe breach of employment terms. In simpler terms, it’s the swift and decisive termination of employment without notice.  

This action should be reserved exclusively for cases of serious misconduct, where the employee’s actions are so egregious that continuing the employment relationship is untenable.

What constitutes serious misconduct in a summary dismissal?

Procedural fairness in summary dismissal

While summary dismissal is swift, employers must adhere to the principles of procedural fairness. This means that the employee must be given an opportunity to respond to the allegations before any decision is made.  

This can involve standing an employee down pending investigation, holding a disciplinary hearing or investigation to ensure the employee’s side of the story is considered.

Utilising written employment contracts in cases of summary dismissal

A well-drafted employment contract is an employer’s first line of defence in cases of summary dismissal.  

The contract should clearly outline the types of behaviour that constitute gross misconduct and warrant summary dismissal. This provides a legal basis for such actions and reduces the risk of legal challenges. 

The Fair Work Act 2009 emphasises the importance of having clear workplace policies and procedures. Employers should ensure that their policies cover expected standards of behaviour, disciplinary procedures, and the consequences of serious misconduct.

Immediate action

The essence of summary dismissal lies in its immediacy. Employers should act promptly once they become aware of the misconduct. Delay in taking action may weaken the employer’s position that the conduct was so egregious that the only solution was summary dismissal and further could be viewed as condoning the behaviour. 

It’s important to note that summary dismissal should be a last resort. In less severe cases of misconduct, employers may choose to issue warnings, implement performance improvement plans, or use other less severe disciplinary measures.

What is the process of summary dismissal?

Understanding the process of summary dismissal is crucial for employers seeking to navigate this sensitive area of employment law.

While urgent and immediate action is typically warranted in cases of summary dismissal, a careful and measured approach is still necessary. 

Standing Down

Noting the balance that employers must strike between urgent action and taking a careful approach, many employers choose to stand down employees who may be accused of serious misconduct.

This usually must be done with pay pending the investigation. The investigation should still move at a brisk pace even if an employer has stood an employee down pending the investigation.

Investigation

Before deciding on summary dismissal, it’s imperative for employers to conduct a thorough investigation into the alleged misconduct.  

This involves gathering evidence, interviewing relevant parties, and ensuring a fair and unbiased examination of the situation. The findings of this investigation will play a significant role in justifying the subsequent dismissal. 

Disciplinary Meeting

Once the investigation is complete, employers should arrange a disciplinary meeting with the employee.

During this meeting, the employee should be informed of the allegations, provided an opportunity to present their side of the story, and given a chance to respond to the accusations.  It is best practice to allow the employee to have a support person present at this meeting.

This aligns with the principles of procedural fairness and contributes to the overall fairness of the dismissal process.

Decision-Making 

Following the disciplinary meeting, the employer must make a decision on whether to proceed with summary dismissal or opt for an alternative disciplinary action.  

This decision should be well-founded, taking into account the severity of the misconduct, the employee’s response, and the overall circumstances.

What are the consequences and legal risks of summary dismissal?

Following summary dismissal, employers must be prepared for potential legal challenges. 

Unfair Dismissal Claims

One of the primary legal risks associated with summary dismissal is the possibility of an employee lodging an unfair dismissal claim.  

Under the Fair Work Act 2009, employees who believe they were unfairly dismissed can seek remedies such as reinstatement, compensation, or other forms of redress. 

To minimise this risk, employers must ensure that the dismissal meets the requirements outlined in the Act. This includes demonstrating that the dismissal was not harsh, unjust, or unreasonable given the circumstances.  

Procedural fairness and adherence to the terms of employment contracts and workplace policies are critical factors in defending against unfair dismissal claims. 

Employers should also keep careful records of the sequence of events that led to the stand down, the process of the investigation, the outcome of the investigation, and how they considered what the employee had to say in response to the allegations. 

If an employer is able to prove that an employee behaved in a way that constitutes serious misconduct, then that employer has a stronger case before the Fair Work Commission if an employee files an Unfair Dismissal Claim. 

Breach of Contract Claims

Summary dismissal can also expose employers to the risk of breach of contract claims.  

If the terms of employment contracts are not followed precisely or if the dismissal lacks a legal basis, the terminated employee may pursue legal action for breach of contract. 

To mitigate this risk, employers should regularly review and update employment contracts to ensure they accurately reflect the expectations and consequences of employee behaviour.

Seeking legal advice during the drafting and revision of contracts can provide an additional layer of protection. 

Defamation Claims 

In certain cases, employees may pursue defamation claims if they believe their reputation has been unjustly damaged by the circumstances surrounding their summary dismissal.  

Employers should be cautious in their communications about the dismissal and ensure that statements made are factual and defensible. 

Seeking legal advice during the termination process and carefully managing communications can help mitigate the risk of defamation claims. 

Key Takeaways 

Summary dismissal is a powerful tool, but its application requires strategic planning, adherence to legal standards, and respect for procedural fairness.  

By understanding the process, potential consequences, and associated legal risks, employers can make informed decisions. These decisions align with both the law and ethical workplace practices.  

At Progressive Legal, our experienced workplace lawyers are committed to assisting you in navigating these complexities. We strive to ensure that your actions are legally sound.  

Contact us at 1800 820 083 or request our advice below for tailored workplace legal advice and support.

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