When Small Business Doesn’t Mean Small Responsibility: How One Worker Beat the Code
It’s a common misunderstanding that small businesses can dismiss staff however they like—especially if you’re a casual or part-time worker. But the Small Business Fair Dismissal Code isn’t a free pass for poor treatment. And when employers don’t follow the Code properly, employees can win their unfair dismissal cases.
Just ask the employee in Shaw v Pat Thomas Memorial Community House Inc [2012].
In this case, Ms Shaw was working for a small community organisation. She was fired for allegedly contacting the Department of Child Protection in breach of a directive. But when her dismissal was challenged, the Fair Work Commission found serious problems.
There was no written direction on file stating that Ms Shaw couldn’t contact the department. There was no mention of this issue in any prior warnings. And she wasn’t given a proper chance to explain herself or respond to the dismissal decision before it was made.
In other words, the employer made a serious decision with no proper process to back it up.
The Small Business Fair Dismissal Code Is Not Optional
Under the Fair Work Act, small businesses (with fewer than 15 employees) can rely on the Code to defend a dismissal. But only if they’ve followed it properly.
That means:
Giving clear warnings if dismissal is being considered (unless it’s serious misconduct).
Letting the employee respond to any allegations.
Allowing a support person in relevant meetings.
Keeping proper records to show what happened.
None of this happened in Ms Shaw’s case. The Commission found the employer did not comply with the Code, and without that protection, the dismissal was judged on broader unfair dismissal principles.
It didn’t hold up.
Why This Matters for You
Too many workers assume that if they’re fired by a small business, they have no rights. But that’s not true. Small businesses can only rely on the Fair Dismissal Code if they can prove they followed it step by step.
If you’ve been fired without:
A warning,
A proper explanation,
Or any chance to respond...
...then it might not matter how big your employer is. You could still be eligible to challenge the dismissal as unfair. And if your employer kept things vague or informal? That works against them. The law requires more than just assumptions.
Just because your employer is small doesn’t mean your rights are too. If you’ve been fired and something feels off—maybe the explanation was unclear, or you were dismissed via text, or you were never warned in writing—you might have a case. Workers like Ms Shaw have proven that when small businesses ignore procedure, the Commission takes it seriously.
