Dismissal System for Small Business

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9. A simple, fair dismissal system for small business A new, fair dismissal system has been introduced as part of the Fair Work system. New dismissal laws took effect on 1 July 2009. Under Work Choices, employees in businesses with up to 100 workers could be dismissed for any reason without any right to challenge the dismissal as being harsh, unjust or unreasonable. For other employees, the employer had only to demonstrate the dismissal was for ‘operational reasons’ and there would be no right of challenge or redress. The removal of these rights resulted in clear hardship for many, and in real feelings of insecurity when workers realised they could be dismissed at any time for no reason. A new fair dismissal system The Government has established new laws regarding unfair dismissal that are fair to small business owners and their employees. The objective of these laws is to ensure good employees are protected from being dismissed unfairly, while enabling employers to manage under-performing employees with fairness and with confidence. Special arrangements for small businesses Within the overall unfair dismissal system, special arrangements apply for small businesses. A small business is a business with fewer than 15 employees based on a simple headcount. These arrangements recognise the special circumstances of small business owners. They do not have human resource management departments, they cannot afford to lose time and they cannot readily redeploy employees into other positions or workplaces. Compared with larger businesses, small business owners benefit from: 1. A doubling of the minimum employment period from six to 12 months, during which time employees cannot take a claim for unfair dismissal, and 2. A short and simple Fair Dismissal Code which, if followed by the small business owner, will ensure a dismissal is not unfair. In

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