Employment is terminated when an employee resigns, is made redundant or is dismissed.
Resignation
An employee has a right to resign but should give the employer notice in writing.
Redundancy
A position becomes redundant when the work performed by an employee is no longer necessary, because the position has been replaced by technology or the work is restructured.
Employees may be entitled to redundancy benefits, depending on the state award or the agreement under which they were employed.
Dismissal
In order to dismiss an employee you must have a valid reason. The reasons can be many and varied and include poor performance and gross misconduct . The employer must give notice in writing and in accordance with the notice period stated in the employment agreement.
Dismissing an employee can take a number of forms, each with differing requirements. You must make sure you understand these requirements to ensure you avoid any legal problems.
A dismissal is unfair when it is 'harsh, unreasonable or unjust'. There are both federal and state laws governing unfair dismissal. States and territories have publications outlining whether a termination is lawful and whether the reasons for termination are valid and fair considerations.
Under the new national workplace system, there are new unfair dismissal laws for small businesses and their employees. View “The Small Business Fair Dismissal code” for more information.
Tax implications
There are certain taxation implications when termination of employment occurs. The Tax Office provides guidance on meeting your obligations to employees who stop working for you.
What to do...
Source: business.gov.au