What is the Small Business Fair Dismissal Code and when does it apply?

The Small Business Fair Dismissal Code applies to businesses with fewer than 15 employees. If you follow the Code and can complete its checklist — a valid reason based on conduct or capacity, a warning and chance to improve, an opportunity to respond, and a support person allowed — the Fair Work Commission will treat the dismissal as fair. The Code does NOT apply to a genuine redundancy.

How do I make a redundancy 'genuine' so it can't be challenged as unfair dismissal?

Under section 389 of the Fair Work Act 2009, a redundancy is genuine only if the job is no longer required because of operational change, you have consulted as required by the applicable award or enterprise agreement, and you have considered whether the employee could reasonably be redeployed. Skipping consultation or redeployment can make the redundancy not genuine and open the door to an unfair dismissal claim.

How long does an employee have to lodge an unfair dismissal claim?

An employee has a strict 21-day time limit from the date the dismissal takes effect to apply to the Fair Work Commission for unfair dismissal or a general protections claim. The minimum employment period is 12 months for a small business and 6 months for larger employers — below that, an employee generally cannot claim unfair dismissal, but general protections under Part 3-1 apply from the first day.

Employer Dismissal Process Builder

Free step-by-step plan for small-business employers to dismiss an employee fairly and lower the unfair-dismissal risk. Covers misconduct, poor performance and genuine redundancy, completes the Small Business Fair Dismissal Code checklist, and downloads a PDF. General information, not legal advice.

Last verified: 2 August 2026

This is a process map — not a finding that a dismissal is lawful. It helps a small-business employer plan a fair, well-documented dismissal process and lower the risk of an unfair dismissal claim. You make the decision. It is general information, not legal advice. If the situation is serious, get advice from the Fair Work Ombudsman (13 13 94 / fairwork.gov.au) or a lawyer first.

Why are you considering dismissal?

MisconductPoor performanceGenuine redundancy

How big is the business?

Small business (under 15)15 or more employees

A small business (fewer than 15 employees) that follows the Small Business Fair Dismissal Code will have a conduct or capacity dismissal treated as fair. The Code does not apply to a genuine redundancy.

Employee details

Employee name (optional)Role title (optional)Employee tenure (months)State / territory

Your business

Business nameYour name (decision-maker)Planned start date

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General information and estimates only — not legal, financial or tax advice. Always check your specific award, agreement or contract, or a qualified professional, before you rely on the result.