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Ending employment

Most businesses lose staff, whether it’s through resignations, retirement, restructuring or poor performance issues.

As an employer, you need to know your legal obligations in ending an employee’s service, and how to support the people leaving, and those who remain, through what may be an emotional and even traumatic experience.
 
For your business, the loss of an employee may mean you lose valuable knowledge and experience, but it may also be an opportunity to maximise the potential of existing employees or recruit new skills and expertise.
 
Having accurate and up-to-date records of employees’ service, leave and other entitlements is a legal requirement, and will help if you need to resolve a dispute with a former employee.
  • Resignations

    Any of your employees has the right to resign at any time. However, your workplace agreement or internal policy may state how employees give notice, such as in writing, and a minimum amount of warning.
     
    When an employee leaves, you must calculate remaining entitlements, such as annual leave, according to your workplace agreements. Learn more here.
  • Redundancies

    You may find that your business changes and needs different structures, especially if you expand, downsize or move into new or additional business premises.
     
    Restructuring your business operations may change the workforce you need. New technology may also cause workforce changes.
     
    When the work performed by an employee is no longer necessary due these to changes a job becomes ‘redundant’. Depending on your employee's length of service and the award, agreement or contract they are on, the employee in that job may be entitled to redundancy benefits.
     
    The Fair Work Ombudsman provides more information about redundancy.
  • Dismissals

    You must have a valid reason to dismiss an employee – either the employee’s poor performance or conduct, or a significant change to your business requirements.
     
    There are processes you must follow to dismiss an employee, to avoid any legal problems.
     
    If the reason is poor performance or misconduct, you should have evidence that you have followed necessary processes, such as providing coaching to address poor performance.
     
    The manner in which you dismiss an employee and communicate the decision within your business will have an impact on your business culture and your reputation as a ‘good employer’.
     
    Read more about dismissing employees fairly. The Fair Work Ombudsman also has information about ending employment, and there is specific legislation for small businesses with fewer than 15 employees – the Small Business Fair Dismissal Code.

Planning templates

Use these free planning templates and guides to help you better plan, prepare, manage, and exit a business. Investing time into proper research and planning can help turn your ideas into reality, and prepare you for what’s to come.

Business plan

A business plan works as a guide when your business is operating; how you operate, planning the future and preparing for risks. It is also often a required document for finance applications.

Marketing plan

An effective marketing plan can help you set clear, realistic and measurable marketing objectives for your business. It can boost your customer base increasing your bottom line.

Emergency plan

Your business is critical to your financial wellbeing, so you’ll want to protect it as much as you can against emergencies and disasters.

Succession plan

Planning for the day you leave your business is a valuable investment.

Our friendly team is here to help

If you need any assistance, please call 1300 142 820 for information relating to small business or visit our contact page for more information.