Can You Actually Sack Someone in Australia? Here’s the Reality

When Pauline Hanson stood up at the National Press Club last week and said businesses can’t sack people anymore, I was excited when ABC News called me for a comment.

And honestly? Her comments resonated.

Not because I agree with everything Hanson stands for. I don’t. But on this point, the feeling that the employment system is stacked against employers, she was describing something real. Something I hear from small business owners every single week.

“They are absolutely terrified of unfair dismissal claims and adverse action claims, which are both on the rise.” Emily Jaksch, ABC News, June 2026

So let me give you my two cents as someone who is dealing with this on the ground every single day.

The law hasn’t changed as much as people think

Australia’s unfair dismissal framework has been in place at a federal level since 1993. The basic requirements have stayed largely the same: you need a valid reason, and you need to follow a fair process.

That means:

• Clearly communicating the issue to the employee
• Giving them an opportunity to respond
• Documenting everything along the way
• Acting consistently and reasonably

Serious misconduct, including theft, violence, and serious safety breaches, can justify immediate dismissal. For performance or behavioural issues, you need a documented process first.

So no, you can sack someone. But you have to do it properly.

So why do business owners feel like they can’t?

This is where the conversation gets more interesting.

The law on paper is one thing. The lived experience of a business owner in Australia right now is another.

Here is what I actually see in my work every day:

1. The cost to lodge a claim is around $90 bucks.

That’s it. Ninety dollars. With AI now helping employees draft applications, the volume of Fair Work Commission claims is surging. In 2024-25, the Commission received more than 44,000 applications, a 10 per cent increase on the year before.

There is very little stopping someone from lodging a claim, even if it has limited merit. And once a claim is lodged, the investigation process is time-consuming and expensive for the business, regardless of the outcome.

2. Most claims never reach a formal ruling

The majority of unfair dismissal claims settle before a formal hearing. Not because the employer did anything wrong, but because settling is cheaper than fighting.

I have sat with business owners who followed every step of the process correctly and still paid a settlement, because the alternative was months of legal fees, time off the tools, and the mental load of carrying the risk around, not to mention lying in bed stressing and ruminating about the claim and the ongoing distraction this causes. This is even when they haven’t done anything wrong and they know they made the right decision to terminate.

The system feels broken and stacked against employers.

3. Small businesses have less capacity to absorb it

A large corporation with a legal team and an HR department can manage a Fair Work claim without it derailing the business. A 12-person hospitality business or a regional trades company cannot. Most cannot afford legal fees of $600 – $1000 per hour.

But the compliance burden is the same. The capacity to absorb it is not.

The bigger picture: Small businesses are carrying too much

The Fair Work claims issue doesn’t sit in isolation. It’s one part of a much heavier load.

In recent years, small business owners have had to absorb:

• Payday super, welcome in principle but operationally complex for small operators
• Expanding leave entitlements, making Australia one of the most generous in the world
• New work from home rights, introduced with little meaningful consultation with small business
• Wage theft criminalisation
• Same job, same pay laws
• Capital gains tax changes affecting how business owners exit

Each reform arrives with the expectation that business owners will figure it out. There is rarely a consultation process that genuinely includes the people running businesses under 20 staff. And there is rarely support for implementing what gets introduced.

Small businesses are the largest employers in Australia. The policy environment doesn’t always reflect that.

“The cost to lodge a claim at the Fair Work Commission is only $89.90, and there’s been a huge increase in employees exercising workplace rights to drag out investigations and secure payouts.” Emily Jaksch, ABC News

What you can actually do about it

Let’s be honest. The system is not designed with small business in mind. The burden of proof sits squarely on you as the employer, and even when someone has been aggressive, or has physically assaulted a colleague, you still have to follow procedural fairness. Skip a step and you hand the other side a case.

That is genuinely frustrating. And it is also just the reality.

The only answer is to get advice before you act. Not after. Not when the claim has landed. Before.

Here is where most small businesses come unstuck:

• They avoid the conversation for too long, hoping the problem resolves itself
• When they finally act, they skip steps or document poorly
• They get advice too late, once the horse has already bolted

The IR laws in Australia could do with some changes. The unfair dismissal laws and general protection jurisdiction exist for a reason. In my view, the Award frameworks and carve-outs for small businesses need to be reviewed. For a start, the 15-employee threshold is outdated and seemingly counterintuitive. Coupled with this, small business owners need someone in their corner before things blow up, not someone to clean up the mess afterwards.

How HR Gurus can help

This is exactly what we do. We work with small and medium businesses across Australia to make the employment system navigable, not to say no to everything, but to give you a clear, risk-managed path forward.

Whether you’re managing a performance issue right now, thinking about a termination, or just want to make sure your processes are solid before something blows up, we can help.

• HR Gurus Membership Club: flat fee, unlimited HR questions, someone who knows your business
• Retainer and ad hoc support: for businesses that need more hands-on help
• Book a call: if you have a situation you need to sort out now

The system isn’t impossible. But you need to know the rules, and ideally, you need someone in your corner who does.

As seen in ABC News, June 2026. Read the full article.