The Victorian Chamber’s expert Workplace Relations Consultants outline their top five tips to help you navigate your responsibilities and make sure employees understand your expectations.

1. Verbal warnings

Human Resources professionals may refer to an employee being given one or more ‘verbal warnings’. ‘Warning’ indicates a formal process, but verbal warnings are often informal and rarely documented. It can send mixed messages to the employee and comes across as punitive but without certainty about its enforceability.

The point of this ‘informal counselling’ is to inform an employee that they have not met the expected workplace behaviour or performance. Informal counselling ensures the employee understands the benchmark they are required to meet. The required standard is usually detailed in a company policy, procedure, law, or “lawful and reasonable direction” from a manager.

An organisation should ensure it has informed the employee of the expected conduct before proceeding with a written warning. For this reason, the supervisor is encouraged to make their own file note of informal counselling with an employee for future reference and risk management. Occasionally a disciplinary outcome might include a ‘Letter of Expected Behaviour’ to the employee, which operates to the same effect.

2. Three warnings

It is a common misconception that an employer needs to give three written warnings before terminating a person’s employment. For performance issues (separate and distinct from conduct issues), the Fair Work Act 2009 (Cth) section 387 instead requires that an employer has provided at least one warning and opportunity to improve before termination.

However, this does not give employers an automatic right to terminate for conduct issues or even once one warning is given for performance. The Fair Work Act still requires that the ‘punishment fits the crime’ for factors including: the seriousness of the issue, whether the employee has accepted responsibility and the employer accepts they will remedy the issue, length of service and employment record, and other issues.

If you intend to operate with fewer than three warnings, it is important to notify the staff early on that a disciplinary outcome may include employment termination, even if only one (or no) previous warning was issued. Many unfair dismissal claims arise because a worker mistakenly assumed they had a right to three warnings.

3. Disappearing warnings

Unions can seek an arrangement with employers – via an enterprise agreement, organisational policy or individual circumstance – where a warning is removed from an employee’s file after a certain period (often 12 months). There is no obligation for an organisation to do this and these arrangements can be problematic.

‘Removing’ the warning from the file can create an assumption over time that the warning never happened. However, it is artificial to expect managers to completely forget past occurrences. In deciding future disciplinary outcomes, an organisation is lawfully entitled to consider a person’s employment record – for example, if they had been warned about the same thing previously or received a warning every year for the past 10 years.

While the weight of a previous warning should diminish as time goes on, and usually carries little weight after 12 months, it nevertheless should remain recorded on the employee’s file.

4. Labelling the warning

Employers are often tempted to label warnings such as ‘first,’ ‘second,’ ‘final.’ Some enterprise agreement disciplinary processes will require this, but otherwise there are no obligations.

It may be preferrable to simply state someone is receiving a ‘warning’ which may lead to further disciplinary action, up to and including termination of employment, if the issue is repeated or performance requirements are not met. Therefore, the employer has more latitude to decide the most appropriate outcome if a subsequent issue arises.

While a ‘final warning’ is important for putting the employee on notice, organisations that don’t tend follow through (issuing a “final warning” and then a “second final warning”) may encourage managers to simply issue a ‘warning’ to not undermine final warnings. In short, a final warning should be just that!

5. Failing to note the employee’s response

Written warnings are often focused on the employer’s perspective and ‘telling’ the employee what they have done wrong. However, the FWC will examine if the employee had an opportunity to explain their actions and if any mitigating factors were considered before a disciplinary outcome was issued. It is also important to ensure the process was perceived by the employee to be fair.

A written warning should include the issues put to the employee and a brief description of the employee’s response (and what the organisation thinks of this response) to demonstrate that their views were genuinely considered.

How the Victorian Chamber can help

If you need an independent review of a disciplinary process or proposed outcome, or consultation for a complex performance or conduct management issue, the Victorian Chamber can help. Our Workplace Relations Advice Line and experienced consulting team provides advice across all industries and occupations on best practice performance and conduct management. Call 03 8662 5222.