You’ve just dismissed an employee who wasn’t performing. Two weeks later, you receive an unfair dismissal claim. Then another letter arrives, a general protections claim for the same termination. Your stomach drops. Which one is worse? Can they do both? And how much could this cost you?
You’re not alone. Every year, thousands of Australian employers face these claims, often unsure of the difference between them, or the very different risks each one carries.
When an employment relationship ends, it is rarely simple. The way a dismissal is managed can make all the difference between a clean break and a costly legal dispute. In Australia, two of the most common avenues for employees to challenge their termination are unfair dismissal claims, and general protections claims under the Fair Work Act 2009 (Cth). At first glance these claims may appear similar, but in reality they are grounded in very different legal concepts, apply to different groups of employees, and carry different risks for employers.
Unfair dismissal
Unfair dismissal is about fairness in the process and substance of a termination. In these cases, the Fair Work Commission (FWC) asks whether the dismissal was ‘harsh, unjust or unreasonable’. This requires employers to show that they had a valid reason for the dismissal such as poor performance or misconduct, and that the employee was given an opportunity to respond before the final decision was made.
Not every employee can make an unfair dismissal claim. Only those who have completed the minimum employment period (6 months for larger employers and 12 months for small businesses) are eligible. There is also an income threshold, meaning that high-earning employees often cannot use this pathway unless they are covered by an award or enterprise agreement. Claims must be lodged quickly, within 21 days of termination, which places pressure on both employees and employers to act promptly.
For employers, the risk in unfair dismissal claims lies primarily in the possibility of reinstatement or capped compensation. While the financial exposure is limited compared to general protections, the reputational and operational disruption of being drawn into an FWC process can still hurt your business, your time, and your team morale.
The best protection against an unfair dismissal claim is to be prepared, read this article to learn more, or call us on 1300 654 590 or email us for comprehensive advice and documentation for your business.
General protections
General protections, sometimes called adverse action claims, are a much broader and more powerful weapon for employees. These claims focus not on the fairness of the process, but on the motivation behind the dismissal or other adverse action. An employer must not take action against an employee because the employee exercised a workplace right such as lodging a complaint, requesting flexible work, or taking parental leave; or because of a protected attribute such as race, sex, disability or family responsibilities.
Unlike unfair dismissal, the general protections regime applies to all employees regardless of their length of service or income level. The most challenging feature for employers is the reverse onus of proof: once an employee alleges that a dismissal was linked to a prohibited reason, the burden shifts to the employer to prove that this was not the case. Without detailed documentation and careful decision-making, employers may struggle to discharge that burden.
The potential consequences are also more serious. There is no cap on compensation and damages may include not only economic loss but also injury to feelings. Civil penalties can also apply. A claim that begins in the FWC can escalate to the Federal Court, making it more costly and protracted.
Can an employee bring both?
Yes, and many do. Employees sometimes face the choice between unfair dismissal and general protections. In certain cases they may technically qualify for both, for example, a long-serving employee dismissed after making a workplace complaint. The Fair Work Act does not allow them to pursue both claims to judgment, but it does allow them to file both applications and then elect which one to proceed with. In practice, many employees begin down both paths, using the early stages of conciliation to determine which claim offers them the greatest leverage.
This dynamic means that you must prepare to defend on both fronts. Even if the circumstances appear to point towards an unfair dismissal claim, an employee might prefer a general protections approach because the remedies are uncapped and the burden of proof is heavier on you as the employer.
Facing an unfair dismissal or general protections claim? Contact us on 1300 654 590 or email us for practical, timely advice on your position to defend the claim.
Practical scenarios
Consider the employee who has struggled with sales targets but was never given written warnings. If they are dismissed abruptly, the legal issue is one of process: they were not given a fair chance to improve. That is a textbook unfair dismissal claim.
Now consider the employee who lodges a bullying complaint and is let go two weeks later for being a “bad cultural fit.” Here the employer’s reasons will be carefully scrutinised, because the timing suggests the complaint itself may have triggered the dismissal. That is the territory of general protections.
There are also situations where the two overlap. An employee with five years’ service applies for parental leave and is then made redundant in a “restructure.” They may be able to argue both that the dismissal was procedurally unfair and that it was motivated by their request for leave. Ultimately, they must choose a single pathway, but the threat of both claims increases pressure on the employer to justify their decision.
What employers should take away
The essential difference is this: unfair dismissal is about whether you acted fairly, while general protections is about why you acted at all. The first can usually be managed with sound processes and documentation. The second requires a more strategic awareness of how employee complaints, leave requests and personal characteristics intersect with termination decisions.
For employers, the message is clear. To protect your business:
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Always document the reasons for dismissal and follow a fair, transparent process (warnings, performance improvement plans, and opportunities to respond);
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Separate performance management from protected activities – Never let issues like complaints, leave requests, or discrimination concerns overlap with termination timing;
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Train managers to avoid careless remarks or rushed decisions that could later be characterised as discriminatory or retaliatory; and
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Seek legal advice before high-risk dismissals – If an employee has recently made a complaint, requested leave, or raised a grievance, get advice before taking any adverse action.
Final word
Both unfair dismissal and general protections claims can cause headaches for employers, but general protections claims carry far greater risk because of uncapped damages and the reverse onus of proof. If you are considering terminating an employee, or if a claim has been lodged against your business, the safest course is to get advice before you act.
We can help. Contact us on 1300 654 590 or email us for practical, timely advice to protect your business.
