Terminating Employees via Text and Email

Considering the public outrage and media hype surrounding Hutchinson’s termination of nearly 100 employees, it is not surprising the Maritime Union of Australia (MUA) has been successful in its last minute bid to seek an injunction to reverse the termination.

In late July, Hutchinson circulated an internal memorandum to workers highlighting the likelihood of redundancies, but providing all workers an opportunity to respond to the redundancy. On 6 August 2015 at 11.30pm, 97 Hutchinson employees received a text message asking them to check their email accounts for an important letter concerning the business’s redundancy program. The email contained confirmation that each of the 97 employees would no longer be retained by Hutchinson in their existing roles, and there would be no chance of redeployment opportunities within the organisation.

MUA alleges that Hutchinson has breached the terms of its enterprise agreement with its employees, by terminating its employees without honouring the agreement’s consultation or dispute resolution clauses. By failing to follow the stipulated consultation process, Hutchinson’s termination of its employee was always likely to attract claims of unfair dismissal, and there is no surprise in the court’s decision to grant the injunction to MUA. Although Hutchinson argue the overturning of the termination is tantamount to forcing a business to retain employees for whom there was no work, it is required to rescind its termination, pending a final decision.

Except for instances where employers have no other practical way of contacting employees, termination via text or email should not be utilised when the option of a face to face meeting is possible. Under the Fair Work Act, there is no assurance that by utilising unorthodox termination methods such as text or email, an employer will be guaranteed a win for unfair dismissal against their employer. Realistically, the Fair Work Tribunal is not so much interested in the manner in which the dismissal occurred, but rather, whether it was harsh, unjust or unreasonable.

At the end of the day, Hutchinson’s only saving grace will be for the stevedore to prove, that regardless of the manner in which its employees were dismissed, employees would still have been made redundant, even if Hutchinson had complied with its consultation obligations. If Hutchinson can prove the result would not have been any different, they may be able to maintain the redundancies were genuine and not harsh, unjust or unreasonable.

Although, it is unlikely there will be any light at the end of the tunnel for Hutchinson’s employees, the court’s decision does provide a stark reality for all employers seeking to circumvent contractual obligations to save time and costs.Employers should endeavor to follow the terms agreed to with respect to the termination of employees, and avoid any attempts to cut corners. Employers should be mindful of the likelihood of prolonged legal proceedings and the burden of adverse costs orders for failing to follow simple steps in restructuring or downsizing. By disregarding basic contractual obligations, employers often commit themselves to starting off on the wrong foot, a mistake Hutchinson is unlikely to repeat.

For industrial relations advice in this area, McLaughlins Lawyers on the Gold Coast can assist employers with respect to their rights, entitlements and obligations under their Enterprise Agreements and at law with respect to terminating employees.

Author: Joshua Rath

Partner: Ian Kennedy

Date: 18/08/2015