To avoid unwanted legal problems, ensure your business has the correct dismissal processes.

When can you legally fire an employee?

Productive and highly-skilled staff are an important part of the smooth running of any organisation, but there are times when certain employees simply do not meet this criteria.

If you have no choice but to dismiss someone who works for your business or company, you will need to make sure that the correct internal processes are in place to avoid unwanted legal problems or unexpected payouts.

An increasing number of workers are taking steps to sue managers and bosses after their employment has ended.

And while claims of wrongful termination may change from one case to another, it is not uncommon to hear of employers coming under scrutiny from industrial relations or other tribunals after accusations of harassment or discrimination have been lodged against them. These impose a much tougher legal standard on the employer.

With this in mind, it is now more important than ever for businesses to make sure that they have the right systems in place to effectively resolve workplace issues or disputes.

Grounds for legal dismissal often include consistent incompetence – which means that an employee simply can not succeed in their job despite been given the opportunity to fulfil work expectations.

If there is a clear violation of company policy or there is a case of repeated absenteeism – the last point can also extend to employees who constantly arrive late to work – then there may be grounds to justify a termination.

Physical violence, drug and alcohol abuse, illegal acts and falsifying information can also be viewed as valid grounds for dismissal.

Before you make the decision to terminate an employment contract, however, employee protection laws might require that you have given the person previous warnings and listened to their version of events so that you can prove it was a fair judgement.

For small businesses – organisations with less than 15 employees – you will also need to be aware of the ways that employment laws differ in this area and consult the Small Business Fair Dismissal Code for detailed information.

Free Download: Termination Letter Template

Need to let an employee go? Use our letter of termination template to ensure you are using the correct format. 

termination letter template