Essay: Australia’s Unfair Dismissal Processes And Proposed Reforms' Effectiveness.

Do Australia’s unfair dismissal processes achieve their purpose, and if not, what reforms should be adopted, including alternatives (or complements) to unfair dismissal provisions?

Overview of Unfair Dismissal Legislation in Australia

The Fair Work Commission (FWC) has the responsibility of the labor court dealing with conciliation and arbitration offer wide range of labor disputes in Australia. It is divided in ten panels, and the most prominent is the Termination of Employment Panel (TEP). The judges of TEP are known as commissioners and their appointed on permanent, full-time basis. The appointing authority is the Gov. Gen. of Australia on the basis of the recommendations made by the government. The nominations for appointment to labor court are based on the demonstrating experience of the candidate in labor law, workplace relations, business management and knowledge of the workings of particular industries. Therefore, the judges are selected from a wide range of occupational backgrounds, however. Generally they are lawyers and attorneys, human resource managers, former businessman, industry experts, delegates of the unions of civil servants. Other panels of FWC (like Minimum Wages or Industrial Action) allocate cases to the judges on account of their industry-specific background. However is not the case with TEP. In this case, the allocation of cases is independent of specific background of the judge.

By legislating statute, the FWC applies a "balance of probabilities" standard while arbitrating unfair dismissal disputes, which is much weaker as compared to the standard of "beyond reasonable doubt" that is applied in the federal courts by the common law judges. Even in case of highly complex cases, it is considered as if the judge in charge, believes that the balance of probabilities, lies slightly in favor of one of the party made a decision, which confirms to the standard. In this regard, the social values as well as the work background of the Commissioner of the FWC may play an important role as compared to the common law courts.

The research question in the present work is to analyze the effectiveness of unfair dismissal processes in Australia. Therefore, it will be suitable to use the three major statutory regimes, which govern unfair dismissal processes. Federal regulation of unfair dismissal started in the regime of Keating government when the Industrial Relations Reform Act, 1993 was introduced under the external affairs power of the Commonwealth. This legislation was based on the Convention on Termination of Employment of the International Labor Organization. In this legislation, dismissal was described as unfair if, after review of the available evidence, third parties (labor courts and tribunals) can describe the dismissal as harsh, unjust or unreasonable. The responsibility of dealing with unfair dismissal cases was given to the Australian Industrial Relations Commission which also made orders for the reinstatement of providing compensation to the employees who were unfairly dismissed. The States in Australia, beginning with South Australia had also introduced their own dismissal regulations even before the enactment of the Federal legislation. The result was that the application of these State provisions continues even after the introduction of Commonwealth legislation. The result was a complex web of regulations and ambiguities in jurisdictions. In the early years of the 1993, civil cases were brought, which resulted in significant protests by the employers. During the years, the legislation and procedures were refined until a more workable balance could be achieved in the form of the introduction of Workplace Relations Act, 1996.

Role of the Fair Work Commission

In 1996, after the election of Howard government, there was renewed pressure by the organizations of employers for removing unfair dismissal regulation, particularly in case of small businesses. When Howard government in control of both houses of parliament in 2005, it declared the reform of unfair dismissal regulation as a major part of the WorkChoices changes introduced by the government, which were present in the Workplace Relations Amendment (Work Choices) Act, 2005. According to WorkChoices, the jurisdiction of Commonwealth increased as the corporations’ power of the Commonwealth was used to supersede the jurisdiction of the States regarding all employment contracts often incorporated businesses. But at the same time, the WorkChoices reforms also significantly reduce the coverage of law. The businesses that have less than 100 workers were exempted from the claims for unfair dismissal. The scope of the prediction was reduced for the employees who were making claims on the basis of procedural grounds. A new definition of redundancy as the dismissal for "genuine operational reasons" ruled out any claims that may have succeeded under the earlier regulations. According to an estimate by the then Department of Employment and Workplace Relations, WorkChoices decrease the coverage of protecting employees from 6.7 million to 3.7 million. There was a decrease of 45% in the coverage. Similarly, there was a drop in the number of claims lodged by the employees and arbitrated by the labor courts between 2006 and 2009.

The Fair Work Act was introduced in July 2009. It was administered by a new body, Fair Work Australia. The result of this legislation was that the coverage of workplaces by federal legislation was increased. State powers were transferred to the Commonwealth by all the states, except Western Australia. Once again the businesses having less than 100 employees were brought under the planes for unfair dismissal. The businesses having less than 15 employees fell under the purview of Small Business Fair Dismissal Code. It was a streamline compliance procedure described for the business, which arguably facilitated the demonstration of fair dismissal to third parties. The employees of businesses having less than employees were also prescribed along with qualifying period. For them, this period was one year as compared to six months prescribed for the employees of larger firms. Limited redress was available if such businesses were in a position to establish that they had followed the Code. The protection provided to the workers increased with the restoration of older definition of 'genuine redundancy'. Similarly, minor revisions were made to Fair Work Act in 2013.

The present research paper also tries to evaluate the level of ideological bias present in the decisions delivered by the liberal courts regarding unfair dismissal. If ideological bias exists in the decisions of the commissioners, then the composition of courts, that regularly changes on account of education and the appointments made by the government is another channel through which the social values of a particular political party may have an impact on judicial decisions. As compared to civil courts, the judicial ideology is likely to play an important role in labor courts. As stated above, in most of the countries, labor courts are quasi courts. They operate with weaker standards as compared to the common law courts. In case of Australia, the changes in labor court, while arbitrating unfair dismissal disputes, apply the standard of "balance of probabilities". This standard is much weaker as compared to the standard of 'beyond reasonable doubt' that is required to be applied by common-law judges operating in Federal courts. Even in case of very complex cases, it is considered to be sufficient that the judge in charge is of the opinion that the balance of probabilities lies slightly in favor of a party to make a decision, which confirms to such standard. In some extreme cases, for example, the judges have been successful in ruling in favor of the employee on account of non-procedural and nonsubstantive factors like the level of hardships faced by the dismissed employee. Even if such extreme use of discretionary powers can be seen rarely in decisions related with dismissal disputes, it reveals the level of scope for maneuver that the judges of labor courts can call upon as compared to the Federal court judges. 

Levels of Protection Offered to Workers

The life tenure enjoyed by the judges and independently set salaries are the significant safeguards that have been providing against any ideological influence the other branches of the government. However these safeguards are not necessarily efficient for deterring political interference. Politicians may still try to impact judicial decisions by adopting punish and reward strategies. The punishments can include barring the promotion of the judges to higher courts or to reduce the budget of the court and its jurisdiction. On the other hand, rewards can be present in the form of markets for political activism where the demand made by politicians for conducting policy through judicial rulings meets the judicial supply of ideological rulings. It is worth mentioning at this point that the credibility of judiciary as an institutional control of the powers of the government relies on its independence from executive and legislature. There are many who believe that the independence of judiciary is the "priceless possession of a country under the rule of law, protecting fundamental freedoms and the pursuit of economic prosperity". The evidence related with politically motivated behavior in the judiciary will therefore be a matter of major concern for public interest.  

Legal protection that has been provided against unfair termination of employment has remained significant in the industrial landscape of Australia, particularly during the last 30 years. Unfair dismissal in Australia, refers to the termination of service often employed without exercising due care by the employer regarding their right to procedural justice enjoyed by the workers. Unfair dismissal also takes place when a dismissal reveals disproportionate application of the third objective of the employer to terminate the relationship of employment. Therefore in this research paper, and evaluation has been made of the unfair dismissal protections provided to the workers in Australia by the government. The developments that the lesson the last 30 years reveal a time that coincides with a deed of neoliberal reforms which deregulated the relationship of employment. The scope of present protections provided to the employees against unfair dismissal is wide. The result is that most of the employees in Australia, have to follow the legislative requirements by terminating the employment contract offer workers as a result of misconduct on the performance or due to redundancy. The result is that the owners of businesses and managers are required to deal with the dismissal of an employee by strictly applying procedures and distributive justice in case they want to avoid any claim for unfair dismissal, which may escalate to binding arbitration.

The issue of a person losing his or her job as a result of unfair or arbitrary dismissal is also a matter of social interest. The reason is that it cuts to the core of justice and the right of the people to be "free from arbitrary and oppressive treatment, whether by the government or by private persons". The arbitration of the termination of an employment is now present under the law in Australia. It introduces a measure of public interest to a public ride that would otherwise be regulated only by the common law. The regulation by government makes employment security is the field of political interests instead of the subject of free market forces that are related with prevailing and socially tolerated, new liberal philosophy. Under the contract law, a right has been provided to the employers to dismiss the worker. But the just execution of these rights is now being mainly judged by a federal tribunal that has the word authority by federal legislation. The present obligations imposed on the employers have been strongly influenced by the results of federal elections held in 2007 during which the people of Australia provided majority to the government that promised to play a significant role in protecting the employment security.

Evaluation of Judicial Bias in Labor Court Rulings

For the purpose of conducting the present research, qualitative research has been adopted. Qualitative research is a scientific method of observation for collecting non-numerical data. This type of research is related with the meanings, characteristics, concepts definitions and descriptions of things and not to their "counts or measures". In this way, qualitative research approach is adopted, in case of several academic disciplines, mainly focusing on human elements of social and natural sciences. At the same time, this research approach is also applied in qualitative market research, service demonstration by nonprofits, business and journalism.

Limitations and delimitations: Limitations are the influences that cannot be controlled by the researcher. In this the limitations can be described as the shortcomings, influences of conditions that are not under the control of the researcher. As a result of the limitations that can be found in the present research, several restrictions have been placed on methodology and conclusions. For example in the present research, the vast amount of data was not possible to be analyzed in a short time. Moreover, the lack of resources was also a limitation for the present research.

On the other hand, delimitations are the choices that have been made by the researcher and then need to be stated. Delimitations described the boundaries that have been set for the present research. In this way, Delimitations explain the things that are not going to be done by the researcher, the literature that is not going to be reviewed, the population that is not going to be studied and the methodological procedures that are not going to be used. For example in the present research, case law is not being analyzed in order to explain the effectiveness of onset dismissal processes in Australia. As a result of the word limit, many cases could not be discussed in detail, which were related with unfair dismissal processes.

Ethical considerations in case of a research are very important. Ethics can be described as the standards on norms of conduct which separate between right and wrong. These ethics helps in deciding the difference between being acceptable and unacceptable behavior. Ethics are important consideration in research. First of all ethical standards prevent the fabrication or falsification of data. In this way promotes the pursuit of truth and knowledge. Ethical behavior will also important for collaborative work, because it encourages an environment of accountability, trust and mutual respect. In the present research, all the data has been collected ethically.

Addison, J. and Teixeira, P. (2003) The economics of employment protection, Journal of Labor Research, 24(1):85

Bertola, G. (1999). Microeconomic perspectives on aggregate labour markets, In Ashenfelter, O. and Card, D., editors, Handbook of Labour Economics, chapter I, North Holland , Amsterdam.

Booth, J. F. (2010). Judicial activism from a law and economics perspective: Party effects and partisan abuse. mimeo, Research School of Economics and Centre for Law & Economics, Australian National University.

Booth, J. F. and Freyens, B. P. (2014) A study of political activism in labour courts, Economic Letters, 123(3):370

Chapman, A. (2009). Unfair dismissal law and work choices: From safety net standard to legal privilege. Economic and Labour Relations Review, 16(2) 255

Cohen, M. A. (1992). The motives of judges: Empirical evidence from antitrust sentencing. International Review of Law and Economics, 12(1):237

Cross, F. B. (1999) The judiciary and public choice, Hastings Law Journal, 50(2):355

Eisenberg, T. (1990) Testing the selection effect: A new theoretical framework with empirical tests, Journal of Legal Studies, 19(2 (Part 1)):337

Eisenberg, T. and Johnson, S. L. (1991) The effects of intent: Do we know how legal standards work? Cornell Law Review, 76(6):1151

Epstein, L., Landes, W. M., and Posner, R. A. (2013) The Behavior of Federal Judges. Harvard University Press, Cambridge.

Feld, L. P. and Voigt, S. (2003) Economic growth and judicial independence: Cross countryevidence using a new set of indicators, European Journal of Political Economy, 19(3):497  

Ferejohn, J. A. and Kramer, L. D. (2006) Judicial Independence in a Democracy: Institutionalizing Judicial Restraint, Cambridge University Press, Cambridge, UK

Freyens, B. P. and Oslington, P. (2013) A First look at incidence and outcomes of unfair dismissal claims under fair work, work choices and the workplace relations Act, Australian Journal of Labour Economics, 16(2):295

Hansen, F. A. (2004) Is there a politically optimal level of judicial independence? American Economic Review, 94(3):712

J.Miceli, T. and Cosgel, M. M. (1994) Reputation and judicial decision-making. Journal of Economic Behavior & Organization, 23(1):31

Kessler, D., Meites, T., and Miller, G. P. (1996) Explaining deviations from the _fty percent rule: A multimodal approach to the selection of cases for litigation, The Journal of Legal Studies, 25(1):233

Klerman, D. and Lee, Y.-H. A. (2014) Inferences from litigated cases, Journal of Legal Studies, 43(2):209

Kulik, C. T., Perry, E. L., and Pepper, M. B. (2003) Here comes the judge: The influence of judge personal characteristics on federal sexual harassment case outcomes. Law and Human Behavior, 27(1):69