Performance Management – Legal Framework (2)

Unfair Dismissal

  • Capability is one of five potentially fair reasons (s98 ERA)
  • Assessed in relation to “skill, aptitude, health or any other physical or mental quality”
  • (s98(3)(a), ERA)
  • Capability therefore covers 1) performance, 2) health
  • Only “potentially fair” >> Will depend on:
    • (a) whether in the circumstances (including the size and administrative resources of the employer’s undertaking) the employer acted reasonably in treating it as a sufficient reason for dismissing the employee, and
    • (b) shall be determined in accordance with “equity and the substantial merits of the case”
  • So how does this translate into practice?