Following notification of an unfair dismissal claim, our client was confused and not sure where they stood. They engaged us to support them in the claim as well as assess the current gaps and risks in compliance. Basically, how did this happen and where else were they exposed?
The client is a local takeaway small business that also provides tourism services for the local community. They employ staff in their business, and volunteers within the tourism services. This is a long standing business within the community and many of the tourism services volunteers have actively been working and receiving financial compensation for many years.
None of the employees or volunteers had agreements in place, clear position descriptions or expectation for conduct when performing duties, and all payments were processed the same way as subject to PAYE tax. Management team members were unaware that this might pose an issue with regards to employment expectations.
One of the volunteers was dismissed, as the management team had enough of ongoing behavioural issues, and decided to let what they thought was a ‘casual volunteer’ go. But then unfortunately the business received notice of an unfair dismissal case.
After comprehensive discussions with the management team, we were able to clearly advise the business that due to the regular and consistent shifts the individual had performed over many years, there may be grounds for the individual to argue that there was an expectation for ongoing work. Together with the regular payments where they had received and been taxed as an employee rather than processing any costs as an expense, there would also potentially be a strong argument to indicate that there was a casual employment relationship rather than a volunteer. The employee sought reinstatement.
In conjunction with employment lawyers, the outcome of the claim was settlement following conciliation, by reinstatement in the individual’s former duties.
In parallel to the settlement of the Fair Work claim, we worked with the business to mitigate any further risk to the business by developing and rolling out a volunteer agreement, position description and code of conduct so that there was clear agreement on the nature of the relationship as well as the expectation for performing volunteer duties and the reimbursement of out of pocket costs, rather than being paid for time.
A settlement was reached for the unfair dismissal claim, which prevented the business from going to a hearing, which would have further drawn out the issue and cost the business time and resources, and could have resulted in being court ordered a resolution that may have included monetary compensation.
The business mitigated further risk exposure with the individual and remaining volunteers by putting agreements and compliance expectations in place.
“Lauren and the team have been very helpful in providing advice and documentation on a range of different HR matters for us. They helped us streamline our HR management to a point where it is now a strength of our business, rather than a headache!”