It depends. And the biggest risk probably isn’t unfair dismissal.
“Can I sack an employee who has been here for 15 years?”
The short answer?
Yes.
There is no rule in Australian employment law that says someone becomes “unsackable” because they have been with the business for 10, 15 or 20 years.
However the “it depends” part will lie solely in the answer to this particular question:
Why are you sacking them and can you provide evidence to prove or support your answer?
When a long-serving employee is terminated, the biggest legal risk may not be unfair dismissal.
It could be what happened in the weeks, months or even years leading up to the decision.
As such it can make things very expensive.
The Employee Who Had Been There Since He Was 18
A useful example is Ruttley v Willis Brothers Installation [2022] FedCFamC2G 430.
The employee, Timothy Ruttley, wasn’t a new starter. He had worked for the business since he was 18. He had worked his way into senior management and even held shares in the company.
Then something significant happened.
Following workplace screening for silica exposure, he was diagnosed with silicosis.
His diagnosis meant he could no longer safely undertake certain physical duties involving silica dust, although he continued performing administration and management work.
From there, the employment relationship deteriorated.
This deterioration in the relationship is where the case becomes particularly important for CEOs, Managing Directors and CFOs.
Reason for Termination
When executives call an employment lawyer about terminating someone, the conversation often starts with something like:
“Do We Have a Valid Reason?”
That’s important, but it is also not the whole story.
In Ruttley, a series of things occurred before the employment ultimately ended.
Issues arose concerning the employee’s leave, wages, company vehicle, fuel card and work phone. Individually, some of those decisions might not look particularly significant.
Collectively?
They can start telling a story and in particular provides enormous risk in a potential General Protections claim.
What Is The “Real” Reason For The Termination Of Employment?
Employees have a range of workplace rights under the Fair Work Act 2009.
They can include making complaints or inquiries about their employment, taking leave, making workers’ compensation claims, requesting flexible work, raising safety concerns and exercising other rights contained under workplace laws.
The legal problem can arise when adverse action is taken because an employee exercised one of those rights. And adverse action isn’t confined to dismissal.
It can potentially include disciplinary action, demotion, reductions in pay, disadvantageous changes to duties or the removal of benefits.
That is why I would be very cautious about looking at a termination decision in isolation.
The real risk may have started months earlier.
“But They’ve Been Underperforming for Years”
Maybe they have.
Long service does not excuse poor performance. It does not prevent misconduct being dealt with. And it does not mean an employer must retain someone indefinitely. However, long service can create another practical problem.
Your Evidence Needs To Match Your Story.
Imagine telling a Court:
“This employee had been performing poorly for years.”
The obvious questions become:
- Where are the performance reviews?
- Where are the warnings?
- Did the employee know what standard or even good performance looked like?
- What did their previous appraisals say?
- Were bonuses still being paid?
- Were salary increases approved?
- Was the employee ever actually told their performance was unacceptable?
- Why did the issue suddenly become serious enough to justify termination now?
That last question can become particularly uncomfortable if something else has recently happened.
Perhaps the employee:
- made a complaint;
- took extended sick leave;
- raised a safety concern;
- made a workers’ compensation claim;
- questioned their pay;
- missed out on a promotion;
- requested flexible working arrangements; or
- complained about a manager.
Suddenly the chronology becomes very relevant!
The Reverse Onus Changes the Risk
This is one of the reasons General Protections claims can be particularly dangerous for employers.
The employer may ultimately need to establish that adverse action was not taken for a prohibited reason.
Think about what that means for the CEO, Managing Director or executive who actually made the decision.
Months or years later, you could be sitting in a witness box being asked:
Why did you terminate this person?
And:
What was going through your mind when you made that decision?
That is why documentation matters.
Memory fades. Contemporaneous documents don’t. And neither do emails, text messages and Teams or Slack messages.
The Expensive Part Can Happen Before the Termination
One of the more extraordinary aspects of Ruttley involved a confrontation between the employee and the majority shareholder.
The Court heard that the shareholder entered the employee’s office, slammed his fist on the desk and demanded his shares back.
The employee subsequently left work distressed, obtained a medical certificate and did not return.
His employment was later terminated, officially because of excessive absence.
This illustrates an important point.
A termination letter does not wipe the slate clean.
A beautifully drafted termination letter prepared at the end of the process does not necessarily fix months of problematic conduct leading up to it.
Same goes for a show cause letter as well.
The Court can look at what actually happened.
- Who said what?
- What decisions were made?
- What changed?
- What was the real reason?
“But We Have a Valid Reason”
This is probably one of the most dangerous assumptions an employer can make.
You may have a genuine performance issue.
You may have legitimate concerns about absenteeism.
You may have a genuine operational problem.
You may even have a perfectly legitimate reason for wanting the employment relationship to end.
But that does not automatically defeat a General Protections claim.
You can have a legitimate business issue … and still lose.
The reason for the decision still matters.
So Can You Sack the 15-Year Employee?
Potentially, yes.
But before doing so, I would want the CEO, MD, CFO or HR leader making that decision to be able to answer at least these questions:
- What is the actual reason we are considering termination?
- What evidence supports that reason?
- Have we previously communicated the issue to the employee?
- Does our documentation match what we are now saying?
- Has the employee recently exercised a workplace right or made a complaint?
- Is there an illness, injury, disability or other protected attribute involved?
- Who is actually making the termination decision?
- What documents, emails or messages exist about that decision?
- Have emotion, frustration or personality conflict influenced the decision?
- What claims could this employee potentially bring if we terminate?
If those questions are difficult to answer, that is probably telling you something.
What Did Ruttley Cost?
The employee ultimately recovered:
$142,631 in economic loss.
$20,000 for distress and hurt.
And $75,600 in civil penalties.
More than $238,000 before you even start talking about the time, legal costs, disruption and management attention involved in litigation.
And remember:
This wasn’t someone who had been employed for six months.
This was a long-serving senior employee who had been with the business since he was 18.
The Question I Would Ask Instead
So next time someone around the executive table asks:
“Can we sack them?”
I would change the question.
Ask:
“If we sack them, what story will the evidence tell anyone (and in particular a Judge or Commissioner) about why we did it?”
In our experience most serious employment disputes don’t suddenly appear on the day someone gets terminated.
There is usually a history.
- A complaint.
- A performance discussion.
- A medical issue.
- A leave request.
- A safety concern.
- A manager who has become frustrated.
- A poorly worded email.
- A decision that made commercial sense at the time but wasn’t properly documented.
Then eventually comes the termination.
By then, the legal narrative may already have been written.
That is why I continue to say this to employers:
The most valuable employment law advice usually happens before the decision is made.
Actually, well before the decision is made.
