Labour Hire Employee dodges the short end of the candy stick

Labour hire companies operate to connect potential employees to businesses of a particular industry that matches their skillset and attributes. Suitability is attained when the attributes of an employee overlap with the operational needs of the business, known as the host employer.

However, the nature of the relationship between employee and labour hire company, in the presence of the third party host employer, can pose legal concerns and implications for the parties involved.

Recently this situation arose in a case before the Fair Work Commission. Labour hire company Adecco Industries found itself liable for the unfair dismissal of an employee who was dismissed by Nestle, the host employer. It is not in dispute that this employee was treated unfairly; she was not offered the rights that the Fair Work Act (1999) affords an employee faced with the prospect of termination.

Despite Adecco’s assertion that the employee remained contracted by Adecco and was merely removed from Nestle, the Fair Work Commission determined that the labour hire relationship cannot be use to abrogate the responsibility to ensure fair treatment of employees.

It was deemed that if the dismissal of an employee would be considered unfair if executed by the Labour Hire company directly, then such a dismissal does not cease to be unfair if executed by a third party to the employment relationship. If such a determination were not reached, it would be effectively permissible for labour hire companies to contract out of the legislative provisions regarding unfair dismissals.

Despite the involvement of host company Nestle, the Fair Work Commission requires that Adecco remedy the employee for the unfair dismissal.

Whilst the employee ultimately enjoys compensation candy, it seems that Adecco must endure the cane. 

To discover the best way to insure and protect your business against such penalties when terminating an employee, speak to one of Nevett Ford’s workplace relations team members on (03) 9614 7111.

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Don’t take it so seriously – the difference between misconduct and serious misconduct

A pool supplies business in Sydney summarily dismissed its general manager for going “behind their back”, making disparaging comments about the business and “betraying the business”. Entram Pty Ltd accused its general manager of preventing a sale of business and breaching his implied duties to act in good faith.

Judge Shenagh Barnes of the Federal Circuit Court accepted the employee’s conduct amounted to misconduct; however, it was not found to warrant serious misconduct and, therefore, summary dismissal.

As a consequence, the employer was ordered to pay $30,283 in damages for failing to provide the employee with notice of termination.

For an employer, the key difference between terminating an employee for misconduct versus serious misconduct will be the provision of notice.

An employee who commits serious misconduct can be terminated on the spot and the employer will not be required to provide notice of termination.

An employee who is dismissed for misconduct must be provided notice of termination. They can be directed to work out their notice period or paid in lieu of notice, at the employer discretion.

As demonstrated by Jeavons v Entram Pty Ltd [2015] FCCA 3457 the consequences of summarily dismissing an employee for misconduct can be significant. Although the employee was terminated in June 2012, a judgment was not handed down until December 2015, meaning the business was in legal limbo for three and a half years. 

To protect your business and insure yourself against such penalties, speak to one of Nevett Ford’s workplace relations team members on (03) 9614 7111 about the right way to terminate an employee for misconduct and serious conduct.

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Redundant one day and offered alternate employment the next equals no redundancy pay

DRW Investments Pty Ltd v Richards [2016] FWC 461 is a decision in which a large transport company having lost a major hauling contract found work for affected drivers with the new contractor.


The affected drivers argued that they had been made redundant by their old employer entitling them to redundancy payments but the old employer disagreed.


Commissioner Sams found that the drivers had resigned from their old employer to take up work with the new employer. As a result their employment had not been terminated at the initiative of the old employer so as to bring into operation section 119 of the Fair Work Act.


Commissioner Sams also commented that redundancy pay was for a specific beneficial purpose and not meant as a windfall where employees, whilst being made redundant one day are offered and accept suitable alternative employment the next day.

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Swearing in the workplace

A recent decision of Horner v Kailis Bros Pty Ltd [2016] FWC 145 concerns a dismissal of an employee for swearing.

In this case the employer got it right and was able to successfully oppose an application for compensation and/or reinstatement for unfair dismissal by the foul mouthed employee.

The employee had been disciplined previously for swearing. The Commission found there was a valid reason for his dismissal because the employee did more than swear but also abused his supervisor.

The employer wisely asked the employee for his version of events as to what happened when the verbal altercation with his supervisor took place. He was told that his job could be under threat. Therefore the Commission was satisfied that the employee had an opportunity to respond and put his version of the events, and that he was aware of the reason why his job could be under threat.

The case is a good example of an employee’s conduct that justified dismissal.

Employers need to make sure they deal with conduct issues properly and employees are afforded procedural fairness, that is given the opportunity to put their version of events.

In dealing with conduct issues we recommend that all employers obtain advice from Human Resource Management specialists or a lawyer who is an Accredited Specialist in Workplace Relations before dismissing a worker for conduct issues.

Nevett Ford Lawyers provide advice on all aspects of Employment Law.

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