urban creature: Unfair Dismissal

Friday, November 19, 2004
Unfair Dismissal
Unfairly dismissing employees is innately unfair, hence the term "unfair dismissal". Unfair dismissal can range from the ludicrous to the borderline. Sometimes employees challenge their sacking on the basis of unfairness when they know full well that they were at fault and rightly should have been sacked. These cases can obviously incur substantial legal costs and this can sometimes threaten the very survival of some small businesses.

On the other hand, employers who do sack their employees unfairly should be legally accountable for their actions. This is called "justice". I would argue that justice should always be served regardless. If people or businesses face hardship in attempting to access the legal system or defend their charges, they should be given assistance by the state.

For those of you who are oblivious to the concept of justice or the necessary intervention of the state, let me put it another way.

Howard will be attempting to exclude small businesses from unfair dismissal claims. He claims that by doing this it will decrease the unemployment rate. I am well aware of the lunacy in his reasoning... that by making it easier for people to be sacked it will mean more people will be employed. Certainly small businesses might be more willing to employ new staff if they didn't have the threat of suffering financial hardship if things didn't work out. This willingness on the part of employers to employ someone for the role and test them out for a while rather than engage in a rigorous and sometimes inhuman interviewing process at the beginning. Some employees do well at selling themselves at interviews and then generally show themselves to be lazy, thoughtless and incompetent later. For many others, including myself, who are hopeless at interviews yearn for the opportunity to simply prove ourselves where it really matters - on the job. This is part of Howard's reasoning and something I would agree with - on its basic level. However, this argument is simplistic and pretty weak as a basis for major legislative change.

Howard's changes would fundamentally result in a two-tiered system. One system for those who run small businesses and another system for those who don't run small businesses. I would be very interested to find out how a small business is defined by the government. If it is defined by the number of full-time (or equivalent) staff - let's say under 50. Those with 49 full-time employees will obviously be thinking twice about taking on an extra person after these changes are made to the law - presuming that their ability to unfairly sack anyone outweighs the benefit they would get from that additional employee. Small businesses mostly grow incrementally - they take on 1 or 2 additional employees as they see the need. These changes to unfair dismissal laws may have the negative effect of keeping small businesses "small". By creating a two-tiered system by setting an arbitrary line in the sand we may actually do more damage to the small business sector of the economy than we mean to.

Furthermore, small businesses often suffer from lack of employees with specialised skills and experience. Larger companies often have prestige and have the ability to further an employee's career without them needing to leave the company. Small businesses have two choices: they can employ younger people who are just entering the job market and train them up; or they can employ those who are close to retirement or have become disillusioned with larger companies. Howard's changes could effectively wipe out any remaining perception of job security small businesses currently have - making it harder for small businesses to find quality staff.

Having worked almost continuously for small businesses (including running my own) throughout my working life I am sympathetic to small business owners. However, the proposed changes are fundamentally short-sighted and could present the small businesses sector with many more problems than they appear to solve - as well as being contrary to our national concept of a "fair go".

  Scribbled by urban creature @ 6:51 pm - [Permanent Link]

At 11:28 pm, Blogger MelbLefty said...

ANd I love the euphemism the libs are using - they're calling their bill to overturn unfair dismissal laws (which prevent unfair dimissal) - "the FAIR dismissal bill".

That's hilarious.

Because of course, as the unfair dismissal laws make it less likely a dismissal will be unfair, the fair dismissal bill will make it less likely that it will be fair...


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