Ever wondered how much notice you are required to give when terminating employment?
Other than looking to the employment contract itself, the first point of reference is always section 117 of the Fair Work Act 2009 (Cth).
This section outlines the minimum notice periods which an employer is required to give an employee upon termination:
Not more than 1 year: 1 week
More than 1 year but less than 3: 2 weeks
More than 3 but less than 5: 3 weeks
More than 5 years: 4 weeks
It’s important to note that employees who are over 45 years of age and have contributed at least 2 years service to the employer are entitled to an additional notice period of one week.
However, it’s not always as simple as following section 117 of the Fair Work Act 2009 (Cth), especially when a disgruntled ex-employee decides to commence legal proceedings against you. The Courts focus more on what’s reasonable under the circumstances rather than just what is set out in the legislation.
By way of background, Mr Macauslane was a financial controller with Fisher & Paykel, on a salary which started at $90,000 and increased to $100,000 per annum. He held a Bachelor and Masters degree and moved his family to Brisbane to take up the position. Mr Macauslane was made redundant at the age of 36 and given one months notice.
In deciding what a reasonable notice period was, the court considered:
- the length of employment;
- the nature of employment,
- seniority and salary of the employee;
- the employee’s age, qualifications and experience.
It was ultimately held that Mr Macauslane was entitled to a 9 month period of notice prior to the termination of his employment.
Therefore, when terminating employment, don’t just consider the employment contract and section 117 of the Fair Work Act 2009 (Cth). Consider what is reasonable in all the circumstances.
If you have any further questions, please do not hesitate to contact me.