No Opportunity to Respond: The #1 Reason Small Businesses Lose Unfair Dismissal Claims (2026 Update)
If you ask me what trips up Australian small business owners more than anything else at the Fair Work Commission, my answer is always the same — and it’s not the reason for the dismissal. No opportunity to respond
It’s the process
Specifically: the employee was never properly told what they were being dismissed for, and never given a real chance to respond (no opportunity to respond) before the decision was made.
The reason can be rock-solid. The employee can be the most difficult person you’ve ever managed. The behaviour can be exactly what you say it is. None of that matters if you skip the step where they get to put their side of the story on the table. That single missing step is what turns a defensible dismissal into a six-month dispute, a conciliation payout, or — increasingly in 2026 — a reinstatement order.
This article walks through what “opportunity to respond” actually means in Australian employment law, what the Fair Work Commission expects you to do, and why getting this one element right is the difference between a clean termination and a $15,000–$25,000 problem.
What the Law Actually Says
Section 387 of the Fair Work Act 2009 sets out the criteria the Fair Work Commission must consider when deciding whether a dismissal was harsh, unjust or unreasonable. There are seven factors. Two of them are about your reason. The remaining five are about your process. Here are the ones the Commission goes to first:
- s387(a) — Was there a valid reason for the dismissal related to capacity or conduct?
- s387(b) — Was the employee notified of that reason?
- s387(c) — Was the employee given an opportunity to respond to any reason related to capacity or conduct?
- s387(d) — Was there any unreasonable refusal to allow a support person?
- s387(e) — Had the employee previously been warned about unsatisfactory performance?
You can be ticking the box on (a) and still lose on (b) and (c). And losing on (b) and (c) is exactly what happens to small business owners every single week.
|
In a recent 2026 Fair Work Commission decision (Thomas v Bin Boy Environmental Pty Ltd [2026] FWC 917), the Commissioner found that even though the employer had valid reasons for dismissal, the employee was not notified of the reasons and not given an opportunity to respond, and the dismissal was ruled unfair. Compensation was ordered. This is happening monthly. The valid reason isn’t enough. |
What “Opportunity to Respond” Actually Means
This is where most small businesses think they’ve done the right thing — and haven’t.
An “opportunity to respond” is not:
- A casual “we need to chat” conversation in the car park
- An email saying “your performance has been poor lately”
- A meeting where you’ve already drafted the termination letter sitting on your desk
- Putting the allegations on the table and dismissing the employee in the same meeting
- Giving them ten minutes “to think about it” before going back in
An opportunity to respond is:
- Specific allegations or concerns should be put to the employee in writing, in plain language they can understand.
- A reasonable amount of time to consider those allegations — usually 24 to 48 hours minimum, longer for complex matters.
- A formal meeting where the employee can present their side of the story, with a support person of their choice present.
- Genuine consideration of that response by the decision-maker before any termination decision is made, not after.
- Written documentation of every step.
The legal phrase that gets used is “a fair go all round.” If a reasonable third party watching the process would say “yeah, that person had a fair shot at defending themselves”, — you’re in good shape. If they’d say “that looked like a setup”, — you’re not.
The Most Common Ways Small Businesses Get This Wrong
Twenty-plus years of helping Australian small businesses through dismissals, and the same six mistakes show up over and over:
1. The "predetermined" dismissal
You’ve already decided. The meeting is theatre. Even if the employee says something brilliant in their response, you’re going through with it. The Commission can spot this from a mile away — and increasingly, employees are being coached to ask “had you already decided before this meeting?” That answer ends up in a witness statement.
2. Combining allegations and termination into one meeting
You hand the employee the allegations and the termination letter in the same sitting. They’ve had no time to respond. The Commission will rule this is not a genuine opportunity to respond, no matter what was said in the room.
3. Vague or shifting reasons
The dismissal letter says “performance.” The witness statement says “behaviour.” The text messages reference “attitude.” If you can’t articulate the single, specific, valid reason — neither can the Commission, and your defence falls apart.
4. Refusing or "forgetting" the support person
The employee asks to bring a support person. You say no. Or you don’t tell them they’re allowed one. Or you push back on who they choose. s387(d) lights up immediately, and your procedural fairness defence is in trouble.
5. No prior warnings about performance
You’ve been frustrated for months. You’ve vented to your business partner. You’ve made notes on your phone. But there’s not a single written warning the employee has actually been given and signed for. The Commission looks at s387(e) and finds you didn’t warn them — and a dismissal “out of the blue” almost always falls.
6. No documentation
If it isn’t written down, it didn’t happen. This is the single most painful lesson small business owners learn at conciliation. Verbal warnings, “everyone in the team knew,” “we had a chat about it” — none of it carries weight without a paper trail.
Why This Has Become Harder, Not Easier, in 2026
A few things have shifted in the last 18 months that make procedural fairness more critical for small business owners — not less:
- Wage theft is now a criminal offence (from 1 January 2025). Final pay errors that used to be a civil dispute now sit in a much higher-risk category.
- The Fair Work Commission has continued to emphasise process over substance in unfair dismissal rulings throughout 2025 and 2026 — meaning a flawed process can sink a dismissal even when the reason was rock-solid.
- More employees are aware of their rights and are lodging claims within the 21-day window. Conciliation settlements are in the $8,000–$20,000+ range for most small-business matters.
- Generic AI-drafted dismissal letters are flooding small businesses’ inboxes — and the Commission is openly sceptical of them. “ChatGPT told me it was fine” is not a defence.
- Cost-of-living pressure means dismissed employees are far more willing to pursue a claim. They have less to lose and a real financial incentive to lodge.
The economics have changed. The cost of getting a dismissal wrong is higher than it’s ever been — and the cost of getting it right is a fraction of what it was even three years ago.
What a Proper “Opportunity to Respond” Process Looks Like
You don’t need a law degree. You need a process. At its simplest:
- Identify the issue precisely — what, when, where, who, and why it’s a problem.
- Put it in writing — a show-cause letter or letter of allegations, in plain English.
- Give the employee reasonable time — at least 24–48 hours, more for complex matters.
- Hold the meeting — with a support person, with a note-taker, with a clear agenda.
- Listen — genuinely. Take notes. Ask questions. Don’t argue.
- Adjourn — never decide in the room. Take time to consider their response.
- Decide and document — write your reasoning. Be able to explain why their response didn’t change the outcome (if it didn’t).
- Communicate the outcome in writing — clearly, fairly, and with the correct notice and final pay.
It sounds simple. It’s not. The detail is where dismissals are won and lost — and the detail is exactly where small business owners run out of road.
For a fuller walk-through of the entire dismissal landscape — notice, redundancy, final pay and the Small Business Fair Dismissal Code — see our companion guide: Ending Employment in Australia: How to Protect Yourself from Unfair Dismissal Claims.
You Don’t Have to Wing This
Most small business owners only ever dismiss one or two people in their entire business life. Why would you be expected to know how to do it properly?
The Fresh HR Insights Termination Sprint is built for exactly this moment — one employee, one situation, the right process from start to finish.
For $695 + GST ($764.50 incl. GST), you get:
- ✅ A 30-minute coaching call with Paulette covering grounds, process, the Small Business Fair Dismissal Code checklist, what to say in the meeting and what not to say.
- ✅ A drafted letter — warning, show-cause, or termination — tailored to your situation, not a generic template.
- ✅ A meeting script you can read from word-for-word.
- ✅ A risk assessment — how exposed are you if this person files a Fair Work claim?
- ✅ Most clients go from booking to “ready to hold the meeting” inside a week.
- ✅ The $695 is credited toward your first month if you decide you need ongoing support.
Book your termination sprint
The Bottom Line
A dismissal that’s right in substance but wrong in process is still an unfair dismissal. The Fair Work Commission has said it, written it, and continues to apply it in case after case in 2026.
If you’re reading this article because you’ve got a difficult employee on your mind right now, the smartest decision you can make today is to pause before you act. Get the process right, get the letter right, get the meeting right — and the rest looks after itself.
The most expensive sentence in Australian small business is “I didn’t know I had to do that.”
You know now.
Frequently Asked Questions — Opportunity to Respond & Procedural Fairness
Q1. What does "opportunity to respond" mean in an unfair dismissal context?
It means giving an employee a genuine chance to defend themselves before you make the final decision to dismiss them. That involves putting the specific reason for the dismissal to them in writing, giving them a reasonable time to think about it (usually at least 24–48 hours), holding a meeting where they can respond with a support person present, and genuinely considering what they say before deciding the outcome. The Fair Work Commission specifically considers this under s387(c) of the Fair Work Act 2009, and it’s one of the most common reasons small business dismissals are ruled unfair — even when the underlying reason for the dismissal was perfectly valid.
Q2. Can I dismiss an employee in the same meeting where I raise the allegations?
Almost never — and it’s one of the fastest ways to lose an unfair dismissal claim. Combining allegations and termination into a single meeting strips the employee of any meaningful chance to respond. The Fair Work Commission consistently rules these dismissals procedurally unfair, regardless of whether the reason was valid. The only narrow exception is summary dismissal for serious misconduct — where the conduct is so serious it makes continued employment untenable (theft, assault, fraud, serious safety breach). Even then, you still need to investigate, give the employee a chance to respond to the allegation, and document everything. “On the spot” dismissals for performance or attitude are a red-flag-waving signal at the Commission.
Q3. How much time do I need to give an employee to respond?
There’s no fixed legal minimum, but the rule of thumb is 24 to 48 hours at the very least for straightforward matters, and longer for complex or serious allegations. The Commission looks at whether the time was reasonable in the circumstances — taking into account the complexity of the allegations, whether the employee needs to gather documents or speak to others, whether they need to arrange a support person, and whether they’re affected by illness, English as a second language, or any other relevant factor. If you’re rushing the timeline because you want it over with, you’re probably rushing it too much.
Q4. What is the Small Business Fair Dismissal Code and how does "opportunity to respond" fit into it?
The Small Business Fair Dismissal Code applies to businesses with fewer than 15 employees (headcount, including casuals). It’s a simplified, checklist-based process for handling dismissals — and following it properly gives small business employers a strong defence against unfair dismissal claims. The Code requires the employer to give the employee reasons for the dismissal and a chance to respond, except in summary dismissal situations involving serious misconduct. If you can show you followed the Code (and you have the paperwork to prove it), the dismissal is generally deemed fair. The key word is “prove.” Verbal assurances that you “followed the Code” won’t hold up — you need written warnings, meeting notes, the allegations letter, and the employee’s response on file.
Q5. Does an employee have a right to bring a support person to a dismissal meeting?
Yes — and unreasonably refusing one is captured under s387(d) of the Fair Work Act. Any employee facing a meeting that could result in disciplinary action, including dismissal, has the right to bring a support person of their choice. That person can be a friend, family member, colleague, or union representative. Their role is to provide support, take notes, and observe — not to advocate, negotiate, or speak on the employee’s behalf (though small business owners often allow some latitude here in practice). You should proactively offer the right to a support person in the meeting invitation letter, in writing. Don’t wait for them to ask. “I didn’t know I was allowed one” is a classic line in an unfair dismissal witness statement — and one that makes the Commission frown.
Q6. What if the employee refuses to attend the meeting or won't engage?
You can still proceed — but the bar for doing so is higher. You need to make multiple, documented attempts to engage the employee. Send the show-cause letter or meeting invitation by every reasonable means (email, registered post, SMS), with a clear written record of each attempt. Give them a final opportunity in writing. If they still refuse to engage and you proceed to dismiss them, your defence is that you offered the opportunity to respond and they declined it — which is different from never offering it in the first place. This is high-risk territory — get expert input before you act, because exactly how you’ve documented those attempts will be picked apart at the Commission.
Q7. Can I rely on warnings I gave verbally?
Not reliably. A verbal warning isn’t worth the paper it isn’t written on. The Fair Work Commission consistently gives little weight to warnings the employer can’t actually produce in writing. If you’ve been raising issues verbally for months, your paper trail is essentially empty — and a dismissal at the end of it looks like it came “out of the blue” from the employee’s perspective. The fix going forward is simple: every performance or conduct conversation that matters gets followed up in writing, ideally by email, summarising what was discussed, what’s expected, and by when. Keep copies. Have the employee acknowledge receipt. If you’re staring at a situation right now where the warnings have all been verbal, stop and get advice before you act — there’s usually a way to reset the process, but you need to do it correctly.
Q8. Does "opportunity to respond" apply if I'm making a role redundant?
The procedural fairness obligations in a redundancy are different — but no less important. With a genuine redundancy, the obligation is consultation, not “respond to allegations.” The employee must be consulted about the proposed change, given information about the redundancy, given an opportunity to put forward alternatives (including redeployment), and have their feedback genuinely considered. If you skip consultation, even a perfectly genuine redundancy can be challenged. We cover this in detail in our Redundancy Sprint. If you’re not sure whether your situation is a dismissal or a redundancy, that distinction alone is worth a 30-minute call before you act — calling something a “redundancy” when it’s really a dismissal in disguise is a fast track to an unfair dismissal claim and a general protections claim.
Q9. What's the difference between "valid reason" and "opportunity to respond"?
A valid reason is the substance of the dismissal — was there a genuine, fact-based reason related to the employee’s capacity or conduct? An opportunity to respond is the process — did the employee get a fair shot at defending themselves before you decided? You need both. A valid reason without procedural fairness is still an unfair dismissal. Procedural fairness without a valid reason is also an unfair dismissal. The Fair Work Commission looks at all the s387 factors and weighs them together — which is why small business owners with rock-solid reasons still lose claims they assumed would be open-and-shut.
Q10. I think I've already messed up the process — what should I do now?
Stop. Don’t dismiss the employee today. The single most important thing you can do is press pause. Almost every flawed dismissal process can be reset before the dismissal happens — but once the termination is delivered, it can’t be undone, and you’re playing defence at the Commission. Book a Termination Sprint straight away. We’ll look at what’s already happened, identify the gaps, and help you decide whether to reset the process from a clean point, continue from where you are with corrective steps, or take a different path entirely. The cost of one Sprint is dramatically less than the cost of the cheapest unfair dismissal settlement we’ve ever seen.
Q11. Where can I get expert help with the dismissal process?
Fresh HR Insights specialises in helping Australian small business owners navigate dismissals fairly, lawfully, and confidently. Our Termination Sprint is built for exactly these situations — focused, practical, expert-led support to get you through the process without the panic. We work with businesses across the Gold Coast, Brisbane, South East Queensland, and Australia-wide via Zoom. For ongoing support, our monthly HR Support Packages start at $295 + GST per month with no lock-in contracts.
👉 Book Your Termination Sprint | 📅 Book a Free Discovery Call
Real HR experts. Real-world experience. Plain English advice. Before you make a decision you can’t take back.
Useful Resources for Australian Employers
- Fair Work Ombudsman — Ending Employment: fairwork.gov.au/ending-employment
- Fair Work Commission — Unfair Dismissals Benchbook: fwc.gov.au
- Small Business Fair Dismissal Code: Download here
- Companion article: Ending Employment in Australia — How to protect yourself from unfair dismissal claims
- Free resource: The 10 HR Mistakes That Could Cost Your Business Thousands
Article updated by Paulette McCormack, CAHRI, MAHRM, MER — Founder, Fresh HR Insights Pty Ltd. Originally published April 2021; last updated May 2026 to reflect current Fair Work Commission jurisprudence and the criminalisation of wage underpayments (effective 1 January 2025). This article is general information and not legal advice. For advice on your specific situation, book a Termination Sprint or a free 30-minute discovery call.

