The Small Business Fair Dismissal Code (the Code) is a legislative instrument declared by the Minister for Employment.

The Code provides the following:

Summary Dismissals
It is fair for a small business employer to dismiss an employee without notice or warning when the employer has reasonable grounds to believe that the employee was guilty of serious misconduct. Serious misconduct includes theft, fraud, violence and serious breaches of occupational health and safety procedures. For a dismissal to be deemed fair, it is sufficient, though not essential, that an allegation of theft, fraud or violence be reported to the police.

Other Dismissals
In other dismissals, a small business employer must give the employee a valid reason based on their capacity or conduct to do the job if they are at risk of being dismissed. The employee must be warned verbally (or preferably in writing), that they risk being dismissed if there is no improvement. Further, the employer must provide the employee with an opportunity to respond to the warning and give them a reasonable chance to rectify the problem, having regard to the employee’s response. Rectifying the problem might involve the employer providing additional training and ensuring the employee knows the employer’s job expectations.

Procedural matters
Employees can have another person present to assist them in discussions in circumstances where dismissal is possible. However, the other person cannot be a lawyer acting in a professional capacity.

If the employee makes an unfair dismissal claim to the Fair Work Commission, the small business employer will be required to provide evidence of compliance with the Code. This evidence may include that a warning has been given (except in cases of summary dismissal), a completed checklist, copies of written warning(s), a statement of termination or signed witness statements.