"To the advantage of all concerned" : practical and principle-based arguments for a revised remedy regime for unfair dismissal in Australia

Among the extensive literature on the merits of unfair dismissal laws, comparatively little attention has been paid to the key issue of which remedies, and in what form, can best give effect to those laws. In order to address this gap in the literature, this thesis examines remedies for unfair dismissal through an empirical study of all unfair dismissal decisions handed down in Australia during the 2010-2011 financial year by the Australian federal employment tribunal. This thesis also contains a detailed analysis of the theoretical underpinnings of the current remedy regime for unfair dismissal in Australia – which comprises reinstatement and monetary compensation subject to a statutory cap – to assess the merits of those remedies from the perspective of principle. The results of the analysis reveal some troubling issues of both practice and principle. First, there is a significant divergence between the law as it appears on the statute books in relation to remedies for unfair dismissal (which emphasises reinstatement and making whole the loss suffered by the unfairly dismissed employee) and the law as it actually operates in practice (in which reinstatement is awarded infrequently and the quantum of compensation ordered in lieu of reinstatement is generally small). Second, this problem is particularly acute for self-represented applicants. An economic decision-making model is used to show that, in particular, it is likely that this problem causes self-represented applicants to reject settlement offers which they should rationally accept. Third, neither compensation nor reinstatement is capable of fully realising the purposes that the remedy regime is designed to achieve. In particular, the availability of the remedy of reinstatement against the will of an employer is unsupportable in principle and fails to afford employers a “fair go all round”. The thesis concludes by proposing that the remedy regime for unfair dismissal in Australia be modified to provide only the remedy of compensation, subject to a significantly larger statutory cap than that which presently applies. It is likely that similar modifications would benefit other jurisdictions around the world, such as Canada and the United Kingdom, which have similar statutory unfair dismissal laws to Australia.Law, Faculty ofGraduat