International calls: +61 3 9653 9123

International calls: +61 3 9653 9123

Call 1300 789 302 to speak to an employment lawyer

Wrongful termination and the law of contract

What is the difference between Wrongful Termination and Unfair Dismissal claims?

To clarify, Wrongful Termination occurs when an employee’s employment is terminated by the employer breaching the contract of employment. Depending upon your contractual position regarding the termination provision (including seniority), a wrongful termination claim may mean you have a reasonable notice claim at common law. That may be worth up to 12 months remuneration on a total package basis.

This is to be distinguished from an Unfair Dismissal claim, which is a statutory cause of action created by the Fair Work Act 2009. Under that Act, unfair dismissal occurs when an employee is dismissed from their position in a harsh, unjust or unreasonable manner. Under these provisions, the damages are capped at 6 months remuneration and it is possible to obtain reinstatement, although that is rare. Proceedings must be commenced within 21 days of date of termination. With respect to Unfair Dismissal claims, this avenue of redress is not available to any executive who earns above the “high income threshold”. Currently that is set at $175,000 per annum but is reviewed on 1 July of each year. Because of the existence of this threshold, most executives do not have access to this remedy.

(See also The Fair Work Act 2009 – unfair dismissal and implications for executives)

Other causes of action that may apply to your circumstances

Adverse Action/General Protections claims

Termination of Employment

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Wrongful Termination claims are also to be distinguished from Adverse Action claims.

Under the Fair Work Act 2009, there is also a separate cause of action known as an Adverse Action/General Protections claim. Under these provisions, you can claim damages due to being treated “adversely” because of exercising a workplace right. With respect to this type of claim, proceedings can either be commenced while you are still employed or within 21 days of termination date. Damages are not capped at 6 months and there are certain procedural advantages with this type a claim that are not available in an Unfair Dismissal claim. In addition, proceedings of this nature are not subject to the high-income threshold as in the case of unfair dismissal claims.

Unfair Dismissal and Adverse Action claims are both commenced in the Fair Work Commission by the filing of an application form and payment of a lodgement fee. Prior to commencing either proceeding, legal advice should be taken as to your preferred course of action.

Discrimination/Harassment and Misleading/Deceptive Conduct claims

Wrongful Termination claims should also be distinguished from Discrimination/Harassment claims under State or Federal Equal Opportunity legislation or a claim based on Misleading/Deceptive Conduct under the Competition and Consumer Act 2010 (Cth).

If you have been a victim of workplace bullying

If you are being bullied in the workplace then there are provisions in the Fair Work Act 2009 that are available to you. However, they are not designed to confer monetary compensation on the victim being bullied. They are simply there to provide a mechanism in which appropriate orders can be made by a Fair Work Commissioner that will address the bullying that is being suffered by the victim.

These provisions are only available to an employee who is still employed by the employer. Immediately the Contract of Employment ceases so does the right to file an application.

For an executive, bullying applications in the Fair Work Commission are of limited utility. However in the circumstances where events may lead to a wrongful termination, it’s possible that they may be used as a vehicle for generating settlement discussions. This is on the assumption that there are genuine grounds for filing such an application the first place.

Common-Law Rights and Reasonable Notice claims

Some of the most important employment law rights and remedies are based on the law of contract. Our legal system has continued to recognise the right of a person whose employment contract has been wrongfully terminated to commence civil proceedings for compensation. This remains the case. Breach of common-law rights may well open up for you a Common-Law Reasonable Notice Claim.

See Your common-law rights and reasonable notice claims

Irrespective of which legal avenue you may have open to you, there are certain basic survival rules you should always follow.

10 Basic rules to follow to survive a work-related crisis

To summarise, you should adhere to the following rules:

1. Do not resign without taking prior legal advice.

2. Do not slacken off or create any further issues that could be used against you in the context of termination of your employment. In addition, always remain scrupulously honest when it comes to handling company property and money, especially your company credit card.

3. Do not reveal that you are taking legal advice.

4. Do not sign any documents that relate to your employment contract without obtaining prior legal advice.

5. By all means provide explanations for your conduct, but don’t make unnecessary admissions.

6. Do not agree to unilateral changes in your employment contract.

7. Keep a diary.

8. Keep a copy of all relevant employment-related documents off-site.

9. Trust no-one in the office.

10. Do not use the office e-mail system to correspond with your lawyer.

Please note that we cannot stress enough the importance of obtaining early legal advice. It is very easy to compromise your claim and, once the damage is done, it may be very difficult to retrieve your case.

Wrongful Termination Lawyers – Legal Advice

Executive Rights Employment Lawyers have extensive experience in achieving excellent results for senior employees facing Wrongful Termination of their employment.

Our aim is always to assist our clients to achieve the best possible outcome in their circumstances, preferably without resorting to the stress, expense and disruption of ligation.

As well as maximising the payout and exit terms, preserving your reputation in the business community and minimising risks associated with Director responsibilities etc. are always a high priority.

If you are seeking legal advice from an employment lawyer about Wrongful Termination of your employment, please don’t hesitate to contact us.

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The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult a lawyer for individual advice regarding your own situation.