Select Committee Backs Employment Termination Bill
A parliamentary select committee has endorsed a new bill that would allow employers and employees to end an employment relationship by mutual consent, without triggering a personal grievance claim. The measure aims to create a fairer, more cooperative process for managing employment exits.
Background and Intent
The private member’s bill, introduced by ACT MP Laura McClure, seeks to enable “pre-termination negotiations” focused on mutual agreement rather than conflict. It offers employers the ability to propose an exit package when an employee is not a good fit, while still respecting both parties’ interests.
“This bill fosters a collaborative approach, empowering employees and employers to approach the sensitive issue of employment termination not as adversaries but as partners,” McClure told Parliament during the bill’s first reading in April.
She emphasized that the goal is to avoid unnecessary stress and to resolve such situations “quickly and fairly.”
Committee Review and Concerns
The Education & Workforce Select Committee supported the general intent of McClure’s proposal but recommended revisions. Members warned that, in its current form, the bill “could risk future legal challenges, undermine certainty and make employee protections less clear.”
Key Features of the Bill
- Allows termination by mutual consent through pre-termination negotiations.
- Permits settlement agreements that may include financial compensation.
- Aims to reduce legal disputes and stress for both employees and employers.
- Proposes additional safeguards to balance fairness and legal clarity.
Author Summary
The bill introduces a cooperative model for ending employment by consent, seeking to simplify dispute resolution while ensuring fairness for both employers and employees.