Can an Employer Terminate Employment for Serious Misconduct?

An allegation of serious misconduct forces an employer to make a high-stakes decision quickly, usually with incomplete information and often while other staff are watching. The temptation is to treat the label as the answer: if the conduct is described as serious misconduct, the reasoning goes, the employee can be walked out the same afternoon with no notice and no further process. That is where most defensible cases are lost. The concept of serious misconduct answers one question — whether notice is required — and it does not answer the separate statutory questions the Fair Work Commission asks if the employee applies for an unfair dismissal remedy.

This article sets out how to keep those questions separate, what the Fair Work Regulations actually say, how the Commission assesses conduct dismissals, how the Small Business Fair Dismissal Code changes the analysis for employers with fewer than 15 employees, and what a defensible decision file looks like at the end of the process. It is written for employers, boards and HR practitioners, and it links to our specialist articles on investigations, procedural fairness, underperformance, redundancy, suspension and general protections rather than repeating them.

Five Separate Legal Questions

Almost every serious misconduct problem contains five distinct questions. Conflating them is the single most common source of error, because each has a different source, a different test and a different consequence.

• Is the conduct “serious misconduct” as defined? Regulation 1.07 of the Fair Work Regulations 2009 (Cth) supplies the definition used across the Fair Work system. It is a definitional provision, not a licence.
• May notice, or payment in lieu of notice, be withheld? That depends on the National Employment Standards in section 117 of the Fair Work Act 2009 (Cth), and on any applicable modern award, enterprise agreement, policy and contract of employment. Section 123 also excludes some employees from the notice provisions.
• Was there a valid reason relating to conduct? Section 387(a) asks whether there was a valid reason for the dismissal related to the person’s capacity or conduct, including its effect on the safety and welfare of other employees.
• Was the dismissal harsh, unjust or unreasonable? That is the overall assessment required by section 385(b), answered by weighing every matter in section 387(a) to (h). A valid reason is a necessary part of the employer’s case, not the whole of it.
• Does the Small Business Fair Dismissal Code apply? Where the employer is a small business employer, section 385(d) makes consistency with the Code a separate element, assessed on its own terms.

Two propositions follow, and both are worth stating plainly. Regulation 1.07 does not mechanically decide an unfair dismissal application. And a valid reason for dismissal does not necessarily justify immediate termination without notice: conduct can be serious enough to end the employment while still falling short of the wilful, repudiatory quality required before notice is withheld.

What Regulation 1.07 Actually Says

Regulation 1.07 defines serious misconduct by reference to two principal limbs:

• conduct that is wilful or deliberate and that is inconsistent with the continuation of the contract of employment; and
• conduct that causes serious and imminent risk to the health or safety of a person, or to the reputation, viability or profitability of the employer’s business.

The regulation then identifies examples. They include theft, fraud or assault in the course of the employee’s employment; being intoxicated at work; and refusing to carry out a lawful and reasonable instruction that is consistent with the employee’s contract of employment. The regulation also addresses intoxication in more detail, treating an employee as intoxicated where their faculties are, by reason of the employee being under the influence of alcohol or a drug (other than a drug administered or taken in accordance with the directions of a medical practitioner or prescription), so impaired that the employee is unfit to be entrusted with their duties or with any duty they may be called upon to perform.

Three cautions matter in practice. First, the examples remain fact-sensitive: each is a category of conduct that will usually be serious, not a conclusion that dispenses with evidence. Second, a label does not prove anything. Describing conduct as serious misconduct in a policy, a letter or an internal report does not establish that it occurred or that it had the required quality. Third, an employer’s policy classification is relevant context — it can show that the employee knew the standard expected — but it cannot convert conduct into serious misconduct if the conduct does not meet the statutory description.

Notice, Payment in Lieu and Summary Dismissal

“Summary dismissal” means dismissal without notice or payment in lieu of notice. The starting point is section 117, which requires written notice of the day of termination and a minimum notice period based on continuous service and age. Section 123 removes the notice entitlement in defined cases, including an employee dismissed for serious misconduct.

The statutory position is fixed by regulation 1.07 together with sections 117 and 123: those provisions, and not the parties’ own documents, determine whether the National Employment Standards notice entitlement is excluded. Other instruments still have to be worked through, because they can add obligations even though they cannot subtract from the standards:

• the contract of employment, which cannot exclude or diminish an entitlement under the National Employment Standards, but which may confer more beneficial notice rights, impose procedural obligations, or create contractual or common-law rights of summary termination whose operation is construed separately from the statutory question. A broader contractual definition of serious misconduct does not control the section 123 question;
• any applicable modern award or enterprise agreement, which may contain termination, disciplinary or consultation provisions that must be complied with, but which cannot exclude the National Employment Standards;
• any policy, which may be relevant evidence of the standard the employee knew was expected, and may impose procedural or contractual obligations depending on its legal effect, but which cannot convert conduct into statutory serious misconduct or displace the National Employment Standards; and
• any statutory or public-sector framework that applies to the particular employer.

Where the conduct is established but its wilful or repudiatory quality is genuinely arguable, dismissal with notice or payment in lieu is often the lower-risk course. It preserves the reason for dismissal while removing the separate contractual argument about notice, and the amount in dispute is usually modest compared with the cost of litigating the point.

Valid Reason Relating to Conduct

Section 387(a) asks whether there was a valid reason for the dismissal related to the employee’s capacity or conduct, including its effect on the safety and welfare of other employees. The reason must be sound, defensible and well founded. It cannot be capricious, fanciful, spiteful or prejudiced.

Where conduct is alleged, the Commission determines for itself, on the balance of probabilities, whether the conduct actually occurred. The question is not whether the employer believed on reasonable grounds, after sufficient inquiry, that the employee was guilty of it — that formulation belongs to the Small Business Fair Dismissal Code pathway discussed below. Nor does the Commission substitute its own view of what it would have done in the employer’s position; it asks whether there was a valid reason and then whether the dismissal was harsh, unjust or unreasonable.

Two consequences follow for employers. Evidence, not conviction, decides the conduct question in an ordinary unfair dismissal case, so the material that will be available to a tribunal matters more than the strength of internal belief. And a finding of dishonesty, or of a single serious lapse, does not automatically make a dismissal fair: the Commission has repeatedly accepted that a single foolish or dishonest act may not, in the circumstances, justify summary dismissal.

The Overall Section 387 Assessment

Section 387 requires the Commission to take into account each of the following in deciding whether a dismissal was harsh, unjust or unreasonable:

• whether there was a valid reason related to conduct or capacity;
• whether the employee was notified of that reason;
• whether the employee was given an opportunity to respond to any reason related to conduct or capacity;
• any unreasonable refusal by the employer to allow a support person to be present to assist at discussions relating to dismissal;
• where the dismissal related to unsatisfactory performance, whether the employee had been warned about it;
• the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed;
• the degree to which the absence of dedicated human resource management specialists or expertise would be likely to impact on those procedures; and
• any other matters the Commission considers relevant.

It is inaccurate to say that a procedural defect makes a dismissal unfair regardless of the conduct. The correct position is more demanding to apply and more useful to know:

• every relevant section 387 matter is weighed, and no single factor is determinative;
• notification of the reason and a genuine opportunity to respond should occur before the decision is made, not after it;
• the response must be genuinely considered — a meeting held after the termination letter is drafted is not an opportunity to respond;
• a procedural defect can be decisive, particularly where a fair process may have produced a different outcome, but it does not operate as an automatic rule; and
• serious misconduct does not remove the need for a defensible process, although the size and resources of the business are expressly relevant to the standard of process expected.

The practical implication is that section 387 rewards employers who can show what they knew, when they knew it, what the employee said and why the decision-maker reached the conclusion they did. For the detailed treatment of process design, see our article on procedural fairness in workplace investigations.

Support Persons and Section 387(d)

Section 387(d) is frequently misdescribed as imposing a duty to offer a support person. It does not. The statutory question is whether there was any unreasonable refusal by the employer to allow a support person to be present to assist at discussions relating to the dismissal. The provision is engaged by a refusal, ordinarily in response to a request, not by the absence of a proactive offer.

Four points follow:

• there is no general positive obligation under section 387(d) to offer a support person;
• offering one in writing is nevertheless prudent, because it removes an easy criticism and evidences a fair process;
• a policy, contract, enterprise agreement or the Small Business Fair Dismissal Code may impose additional obligations, and those obligations are enforceable on their own terms; and
• a support person ordinarily attends to assist the employee rather than to act as an advocate, subject to the applicable instrument and the circumstances. Refusing a support person outright, or insisting the employee attend alone, is difficult to defend.

Small Business Fair Dismissal Code

For employers with fewer than 15 employees, the Small Business Fair Dismissal Code is the most important provision in this area, and the most frequently misunderstood.

Who is a small business employer. A small business employer generally employs fewer than 15 employees, counted by headcount rather than full-time equivalents, at the relevant time. The count includes employees of associated entities, and includes regular and systematic casual employees. It generally includes the employee being dismissed and any other employee being dismissed at the same time. Whether an entity is an associated entity, and whether a particular casual is engaged on a regular and systematic basis, are questions that need to be worked through on the facts rather than assumed.

Why the Code matters. Under section 385(d), a dismissal that was consistent with the Code is not an unfair dismissal. Consistency with the Code therefore prevents a finding of unfair dismissal without the Commission proceeding to the ordinary harsh, unjust or unreasonable assessment.

The summary dismissal limb. The Code provides that it is fair for a small business employer to dismiss an employee without notice or warning where the employer believes, on reasonable grounds, that the employee’s conduct is sufficiently serious to justify immediate dismissal. The examples given in the Code and in the Commission’s current guidance on it are theft, fraud, violence, sexual harassment and serious breaches of occupational health and safety procedures. No category automatically proves compliance: the employer must genuinely hold, on reasonable grounds, the belief that the employee’s conduct was sufficiently serious to justify immediate dismissal.

Reporting to police or a regulator. Where suspected theft, fraud, violence, sexual harassment or a serious safety breach is reported to police or another regulator, the report may be relevant to the reasonableness of the employer’s belief. It is neither essential nor determinative of Code compliance, and the Code does not establish a general rule that an employer should, or may simply, await the external investigation. The employer must still decide the employment issue in a timely and procedurally defensible way, while managing any risk of prejudicing a police or regulatory process.

How the inquiry differs. The Code inquiry is not identical to the ordinary section 387 inquiry. Because the question is directed to the employer’s belief and the grounds for it, the Commission does not necessarily have to determine that the alleged conduct objectively occurred. What the employer must be able to show is the belief, its seriousness, and the reasonable grounds — which in practice means the inquiries actually made before the decision, the material considered, and any account the employee gave. Contemporaneous records are powerful evidence of the inquiries made and the grounds for the belief. Their absence can make Code compliance materially more difficult to establish, although compliance may still be proved through credible oral and other evidence.

Burden and limits. The employer bears the practical burden of establishing compliance with the Code. The Code’s procedural provisions — including its provision for another person to be present at a discussion to assist, which cannot be a lawyer acting in a professional capacity — are distinct from the section 387(d) test, and should not be conflated with it. The Code also contains a separate pathway for dismissals other than summary dismissal, which requires a valid reason based on conduct or capacity, a warning that the employee risks dismissal, a reasonable chance to rectify the problem, and an opportunity to respond. Completing the Code checklist is useful evidence of the process followed. It does not immunise the employer, and it does not remove the need for the belief to be genuinely held on reasonable grounds.

Evidence and the Standard of Satisfaction

Employment findings are not proved beyond reasonable doubt. Even where the allegation would also be a criminal offence, the question for an employer, and later for the Commission, is whether the conduct occurred on the balance of probabilities.

That does not make serious allegations easy to establish. The seriousness of an allegation, and the inherent improbability of the conduct alleged, affect the strength and quality of the evidence needed before a decision-maker can be reasonably satisfied that it occurred. A grave allegation supported only by an untested assertion will usually not reach that point. This is a matter of the persuasiveness of evidence, not a separate or higher standard of proof, and it is better expressed that way than by treating a case name as a third standard sitting between the civil and criminal tests.

Practically, that means attending to:

• Credibility and corroboration. Who says what, what interest they have, and whether anything independent supports the account.
• Contemporaneous documents. Rosters, file notes, messages, incident reports and diary entries made at the time usually carry more weight than later recollection.
• System evidence. CCTV, access-control and door logs, point-of-sale data, email and file-transfer logs, telematics and till reconciliations, obtained in accordance with the applicable surveillance and privacy restrictions.
• Metadata and chain of custody. Where digital evidence matters, preserve it in a way that records who extracted it, when and how, and avoid working on originals.
• Inconsistent accounts. Identify the inconsistency, put it to the person, and record the explanation rather than assuming dishonesty.
• Admissions. Note precisely what was admitted, in what terms and in what context; a partial admission is not an admission of the whole allegation.
• Circumstantial evidence. A combination of facts may support an inference, but the inference must be reasoned and alternatives considered.
• Suspicion versus a sustainable finding. Suspicion, however reasonable it feels, is not a finding. Where the evidence stops short, the honest conclusion is that the allegation is not substantiated.

Suspension and Stand-Down

An employer who wants to exclude an employee from the workplace during an investigation should first identify its lawful authority to do so. That authority is usually found in an express contractual term, an applicable award or enterprise agreement, a policy that has contractual force, a statutory or public-sector framework, or the employee’s agreement. Directing an employee not to attend work without authority, or without pay, invites a claim for breach of contract and can itself be characterised as adverse action.

Where suspension is available, it should generally be:

• on full pay, including any regular allowances or benefits the employee would ordinarily receive;
• precautionary rather than punitive, and described as such;
• based on an identified risk to safety, witnesses, evidence, clients or operations;
• proportionate — consider alternative duties, a change of reporting line, restricted system access or relocation before full exclusion;
• confirmed in writing, stating the reason, the expected duration, the employee’s obligations, contact arrangements and that no finding has been made;
• confidential so far as reasonably possible, with a neutral internal message; and
• reviewed at sensible intervals rather than allowed to continue indefinitely.

Suspension is not the same as a stand-down under section 524, which permits an employer to stand an employee down without pay only in defined circumstances where the employee cannot usefully be employed — such as industrial action other than by the employer, a breakdown of machinery or equipment for which the employer is not responsible, or a stoppage of work for which the employer is not responsible. Section 524 is not a general mechanism for suspending an employee during a misconduct investigation, and using it that way is a common and expensive error. Our article on suspension pending investigation deals with the mechanics in detail.

Categories of Conduct and Proportionality

The categories below are the conduct types that most often lead to summary dismissal. None of them automatically justifies it. In each case the outcome depends on the evidence, the employee’s role and seniority, the applicable policies and the training actually given, the actual or potential harm, whether the conduct was deliberate or reckless, consistency with how comparable conduct has been treated, the employee’s prior record and length of service, and any mitigating circumstances including health, remorse and personal circumstances.

• Theft, fraud and dishonesty. Taking cash, stock or property; falsifying timesheets or expense claims; misusing a company card. Value is relevant but not decisive; the breach of trust and the employee’s role often matter more. Dishonesty is not, of itself, an automatic answer.
• Violence and credible threats. Assault, fighting, throwing objects or threats that a reasonable person would take seriously, particularly where other staff or customers were exposed to risk. Provocation, self-defence and context still require consideration.
• Sexual harassment, bullying and discriminatory conduct. Serious or repeated conduct of this kind can justify dismissal, and an employer has separate positive obligations to eliminate it. A complaint is not a finding, and the complainant’s safety and the respondent’s right to respond both require management.
• Deliberate or reckless safety breaches. Bypassing isolation procedures, disabling guarding, ignoring critical instructions or falsifying safety records. Whether the employee was trained, supervised and equipped, and whether the practice was tolerated in the past, are central.
• Intoxication at work. Regulation 1.07 addresses impairment that makes the employee unfit to be entrusted with their duties. Testing must be lawful and consistent with policy, and prescribed medication and dependence issues may raise disability and adjustment considerations.
• Refusal of lawful and reasonable directions. The direction must be both lawful and reasonable, and consistent with the contract. A refusal grounded in a genuine safety concern, a medical restriction or a right to refuse unsafe work is a different matter.
• Misuse of confidential information or systems. Exporting client lists or pricing data, unauthorised access to records, or forwarding material to a private account, especially before a move to a competitor. Preserve the forensic evidence before confronting the employee.
• Falsification of records. Altering clinical, financial, compliance, delivery or safety records is treated seriously because of the reliance placed on them and the regulatory consequences.
• Conflicts of interest. Undisclosed secondary employment, related-party dealings, secret commissions or diverting opportunities. The seriousness usually turns on concealment and the employee’s fiduciary or managerial position.

Out-of-Hours and Social Media Conduct

Conduct outside working hours can support dismissal where there is a sufficient connection with the employment. The connection may arise where the conduct damages the employment relationship, damages the employer’s legitimate interests, or is incompatible with the employee’s duties or position. The same analysis applies to social media: a post that identifies the employer, harasses a colleague, discloses confidential information or is incompatible with the employee’s role can be connected to the employment, while genuinely private conduct with no such connection generally is not. A policy can inform employees of the standard expected, but it cannot manufacture a connection that does not exist.

Investigation, Particulars and Disclosure

There is no rule that a formal investigation must precede every conduct dismissal. What is required is that the allegations be sufficiently particularised, and the adverse material disclosed sufficiently, for the employee to give a meaningful response. Particulars should identify what is alleged, when and where it occurred, who was involved, the rule, policy or standard said to have been breached, and that dismissal is a possible outcome.

Sufficient disclosure is not the same as attaching every document. The test is whether the employee can understand and answer the case. Legitimate qualifications include:

• Witness confidentiality and safety. The substance of an account can often be put without identifying the witness where there is a genuine risk of retaliation.
• Privacy. Third-party personal information, health information and unrelated material should be redacted rather than distributed.
• Surveillance restrictions. Workplace surveillance and privacy laws limit how camera, computer and tracking material may be obtained and used, and those limits apply to the investigation as well as to the dismissal.
• Privilege. Legal advice and investigations conducted for the dominant purpose of legal advice may be privileged; distribution can waive it, and the structure should be decided at the outset.
• Parallel processes. Police, regulator, OHS or insurer processes may affect timing and disclosure. The employer is generally not obliged to await a criminal outcome, but a documented decision about sequencing is important.
• Lawful preservation of evidence. Secure records, devices and footage early, using proper authority and without destroying originals.
• No retaliation. Complainants, whistleblowers and employees exercising workplace rights must not be disadvantaged. Retaliation converts a manageable dispute into a general protections or whistleblower claim.
• Findings separate from sanction. The investigator establishes what happened; the decision-maker decides the consequence. Merging the two invites a prejudgment complaint.

For the detail, see our articles on workplace investigations, common investigation mistakes and procedural fairness.

Making the Decision and Choosing the Sanction

The decision stage is where defensible investigations are most often undone. A workable framework looks like this:

1. Identify the decision-maker and confirm they have authority and have not prejudged the outcome. Someone who witnessed the conduct or made the complaint is a poor choice.
2. Deal with each allegation separately. Do not roll several allegations into a global conclusion.
3. Record the evidence accepted and rejected, and why. Reasons that engage with the competing accounts are far more durable than conclusions.
4. Consider the employee’s response genuinely, including any new information, and make further inquiries if the response calls for them.
5. Weigh the relevant personal factors — role, length of service, disciplinary record, consistency with how others have been treated, remorse, health, and the consequences of dismissal.
6. Determine whether the conduct is substantiated on the balance of probabilities, or not substantiated.
7. Separately determine the proportionate outcome. Substantiation and sanction are two decisions, not one.
8. Confirm which outcome is justified — summary dismissal, dismissal with notice or payment in lieu, a final written warning, a warning with training or supervision, a change of duties, or no action.
9. Give written reasons that reflect the reasons actually relied upon, in language the employee can understand.
10. Do not manufacture or improve reasons later. Reasons constructed after the event are usually detected and badly damage the employer’s credibility.

Misconduct discovered after the dismissal raises different questions in different jurisdictions. At contract law, conduct that already amounted to a repudiatory breach at the date of termination may be relied upon to justify termination without notice even if it was discovered later. In an unfair dismissal application the Commission is concerned with the reason the employer actually acted upon, so after-acquired evidence does not automatically cure a decision that was defective when made, though it may be relevant to remedy. If the temptation to “shore up” a decision arises, that is the point at which to obtain advice.

Notice, Final Pay and Surviving Entitlements

Summary dismissal concerns entitlement to notice or payment in lieu of notice. It does not erase:

• wages and other amounts already earned;
• accrued and untaken annual leave, and any annual leave loading payable on termination;
• any applicable long service leave entitlement, which depends on the employee’s service and the governing regime — Victorian long service leave legislation, a portable scheme, or an award or agreement entitlement;
• superannuation contributions;
• authorised expense reimbursements; and
• contractual, award or enterprise-agreement entitlements that survive termination on their proper construction.

Deductions from final pay require a lawful basis, and the applicable award, enterprise agreement or contract must be checked for the timing of final payment and any special provisions. Do not apply a universal conclusion about long service leave on termination for serious misconduct without verifying the employee’s actual service and the regime that governs it. The Fair Work Ombudsman’s guidance on notice and final pay is a useful cross-check, and the applicable instrument prevails over any general summary.

Unfair Dismissal Exposure in Outline

The unfair dismissal jurisdiction is dealt with in detail in our article on unfair dismissal claims in Australia. In summary:

• the employee must be a national system employee who was protected from unfair dismissal at the time;
• they must have completed the minimum employment period — six months, or 12 months where the employer is a small business employer;
• they must be covered by a modern award, covered by an applicable enterprise agreement, or earning below the high income threshold;
• an application must be made within 21 days after the dismissal took effect, extendable only in exceptional circumstances;
• the Commission then makes the overall section 387 assessment; and
• reinstatement is the primary remedy under section 390, with compensation available only where reinstatement is inappropriate.

Compensation, stated accurately. Compensation is not capped at the high income threshold. Section 392(5) caps compensation at the lesser of two amounts: half the high income threshold immediately before the dismissal, and the employee-specific amount worked out under section 392(6). That employee-specific limb is the total amount of remuneration received by the employee, or to which the employee was entitled, whichever is higher, for any period of employment with the employer during the 26 weeks immediately before the dismissal, subject to the statutory and regulatory qualifications — with regulation 3.06 relevant to how that period is calculated in some cases. Section 392(4) provides that the amount ordered must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused by the manner of the dismissal. Compensation is directed at lost remuneration, and section 392(2) requires the Commission to consider matters including the employer’s viability, the employee’s length of service, remuneration the employee would have received, efforts to mitigate and any misconduct that contributed to the dismissal.

Figures verified for 2026–27. The high income threshold is $190,100 for the period 1 July 2026 to 30 June 2027, and the general maximum compensation amount for dismissals taking effect on or after 1 July 2026 is $95,050 — half the threshold. Both amounts are indexed each 1 July, and the employee-specific 26-week remuneration limb may produce a lower cap. Always confirm the current figures against the Commission’s published guidance before relying on them.

Most Victorian private-sector employment falls within the national system. Contracts of employment, Victorian discrimination and occupational health and safety legislation, Victorian long service leave law, workers’ compensation and some public-sector arrangements can require separate analysis, and a dismissal that survives the Fair Work Act can still generate exposure under one of them.

General Protections and Other Exposure

Unfair dismissal is rarely the only risk, and it is often not the largest. A dismissal-related general protections application ordinarily has a 21-day deadline, and general protections compensation is not subject to the unfair dismissal cap: a court may order compensation for proved loss, together with penalties, and accessorial liability can extend to individuals knowingly involved.

Prohibited reasons commonly arise where the employee had recently:

• made a complaint or inquiry in relation to their employment;
• made or foreshadowed a workers’ compensation claim;
• taken or requested leave, including personal or carer’s leave;
• disclosed a disability, illness or injury;
• engaged in union or other industrial activity;
• raised a health and safety concern or refused unsafe work;
• made a discrimination or harassment complaint; or
• made a protected disclosure.

Where the objective elements are established and a prohibited reason is alleged, section 361 presumes that the action was taken for that reason unless the employer proves otherwise, and under section 360 a prohibited reason need only be one of the operative reasons. That reverse onus makes the actual reasoning of the decision-maker, and the contemporaneous documents recording it, decisive. It is also why the identity of the decision-maker and the sequence of events should be recorded carefully at the time.

Depending on the facts, a dismissal for alleged serious misconduct can also generate a contractual claim for notice or damages, a discrimination complaint, a whistleblower claim, an underpayment or final-pay dispute, defamation or confidentiality issues arising from how the reasons were communicated internally, and occupational health and safety exposure where the process itself creates a psychosocial hazard. Each of those is its own field; the point here is to identify them early enough to manage them.

Resignation and Forced Resignation

A voluntary resignation is not a dismissal, and an employee who chooses to resign rather than face a disciplinary process ordinarily has no unfair dismissal claim. Section 386(1)(b) captures the different case of a person who resigned but was forced to do so because of conduct, or a course of conduct, engaged in by the employer. That threshold is not satisfied merely because the resignation occurred during an investigation, or because the employee found the process stressful. It may be satisfied where the employer left the employee no real choice — for example, by requiring a resignation as the alternative to immediate dismissal without any process.

When a resignation arrives mid-process, acknowledge it in writing in neutral terms, confirm the end date and the treatment of notice, avoid pressuring the employee either way, and decide deliberately whether to complete the investigation — which may still be necessary for a complainant, a regulator or a recurrence risk.

Common Employer Mistakes

• Treating the label as the analysis. Deciding the conduct is “serious misconduct” and assuming that answers notice, valid reason and fairness at once.
• Prejudgment. Drafting the termination letter before the meeting, so that the process becomes a formality.
• Vague allegations. Alleging “unprofessional behaviour” without the conduct, date, place, people and standard breached.
• Ambush meetings. No notice, no particulars and a demand for an immediate answer.
• Mishandling a support person request. Refusing a request, or telling the employee the discussion is “not that kind of meeting” when dismissal is a realistic outcome. Section 387(d) does not require an offer, but an unreasonable refusal is expressly relevant.
• Unlawful or unpaid suspension. Excluding the employee without identifying the source of authority, or relying on section 524 for a misconduct investigation.
• Ignoring mitigation and consistency. Failing to consider service, record, remorse or health, or dismissing for conduct that previously attracted a warning for someone else.
• Blending findings and sanction. Letting the investigator recommend dismissal and the decision-maker adopt it without independent consideration.
• Thin records. No particulars letter, no note of the response, no reasons — which makes even a sound decision hard to defend.
• Mishandling final pay. Withholding accrued entitlements on the basis that the dismissal was summary.

Staged Employer Checklist

This checklist is a practical sequence, not a guarantee. Following it does not make a dismissal lawful; the merits still depend on the evidence, the instruments and the decision actually made.

1. Stabilise. Address immediate safety, separate the people involved if necessary, and preserve evidence including footage, records, devices and system logs.
2. Check the framework. Confirm jurisdiction and coverage, identify the contract, award or enterprise agreement, locate the relevant policies, and confirm who has authority to decide.
3. Consider suspension. Only with lawful authority, on pay, precautionary, proportionate and in writing.
4. Particularise the allegations. What, when, where, who, which standard, and that dismissal is a possible outcome.
5. Investigate proportionately. Match the depth of inquiry to the seriousness and the extent of the dispute; use an external investigator for sensitive or senior matters.
6. Disclose adverse material sufficiently. Enough for a meaningful response, with proper redaction and attention to confidentiality and privilege.
7. Handle support-person requests correctly. Allow a request unless there is a genuine reason; offering the opportunity is prudent.
8. Consider the response. Without prejudgment, and with further inquiry where the response requires it.
9. Make findings, then decide the sanction. Two separate steps, recorded separately.
10. Test consistency and mitigation. Compare previous outcomes and record why any difference is justified.
11. Obtain advice before summary dismissal where the risk is material — senior employees, contested facts, recent complaints or leave, or likely general protections exposure.
12. Prepare accurate written reasons reflecting the reasons actually relied upon.
13. Calculate final entitlements correctly, including leave, long service leave where applicable, superannuation and reimbursements.
14. Preserve the decision file in an organised form, including the particulars, the evidence, the response and the reasons.
15. Notify insurers where an employment practices or management liability policy may respond.
16. Diarise the 21-day windows for unfair dismissal and general protections applications, and prepare the response material while recollection is fresh.

How We Can Help

We act for employers, boards and HR teams on serious misconduct matters, usually at one of three points: at the outset, when the allegation lands and the immediate decisions are suspension, evidence preservation and scope; mid-process, when the particulars, disclosure and meeting structure need to be right; and at the decision point, when the question is whether summary dismissal, dismissal on notice or a lesser sanction is defensible. We also defend unfair dismissal and general protections applications, and we brief and instruct external investigators where independence matters. Advice at the start is almost always cheaper than a remedy at the end.

Related Reading

• Unfair dismissal claims in Australia — eligibility, Form F2 and F3, jurisdictional objections, process and remedies.
• Workplace investigations — scope, investigator selection, interviews and reports.
• Procedural fairness in workplace investigations — notice, disclosure, response and impartiality.
• Common investigation mistakes — the errors that most often undo a defensible decision.
• Suspension pending investigation — authority, pay, duration and communications.
• General protections and adverse action — the reverse onus and uncapped compensation risk.
• Managing underperformance — warnings and improvement plans where the issue is performance rather than misconduct.
• Genuine redundancy and consultation — where the role, not the conduct, is the issue.
• Employment law for employers — how we work with employers on workplace risk.

Official Sources

• Fair Work Act 2009 (Cth) — current compilation — including sections 12, 23, 117, 123, 385, 387, 388, 390, 392, 394, 400A, 524 and 611.
• Fair Work Regulations 2009 (Cth) — current compilation — including regulation 1.07 (serious misconduct) and regulation 3.06 (compensation).
• Small Business Fair Dismissal Code and the Commission’s explanation of what the Code is and how the headcount works.
• Fair Work Commission — Unfair Dismissals Benchbook and the Benchbook material on conduct and valid reason.
• Fair Work Commission — compensation for unfair dismissal — the statutory cap and how compensation is assessed.
• Fair Work Commission — unfair dismissal — eligibility, the 21-day deadline and the process.
• Fair Work Ombudsman — notice and final pay and dismissal, including serious misconduct.
• Long Service Leave Act 2018 (Vic) — where Victorian long service leave applies to the employment.
• Occupational Health and Safety Act 2004 (Vic) — duties relevant to safety-related misconduct and to the conduct of the process itself.

Frequently Asked Questions