Speaking before the Senate’s dedicated COVID-19 inquiry, Bernadette O’Neill, general manager of the Fair Work Commission (FWC), said that while dismissal claims have been “reasonably constant” over a number of years, recent numbers show an unprecedented spike of 70 per cent.
“I think it’s fair to say that it is clearly COVID-19,” Ms O’Neill said.
“Internal research that we’ve done, for example, points to a positive correlation between unemployment levels and retrenchment rates and unfair dismissal claims, which makes a lot of sense when you think about it.”
Asked whether the increase in claims is higher than that seen during the global financial crisis, Ms O’Neill said: “I think that is absolutely the case.
“I don’t have the 2008–09 figures in front of me. Of course, at that time, 2009, the Fair Work Act commenced and the whole jurisdiction of employment was consolidated, so it might be difficult to draw a direct parallel, but there’s no doubt that what we’ve seen in terms of a spike is unprecedented, as I’ve said.”
Commenting on the FWC’s findings, Employsure managing director Ed Mallett expressed some doubt.
“I am not seeing that yet,” Mr Mallett said.
“Last month, they said 60 per cent, now 70 per cent this month. I don’t think they’ve got any particular self-interest in making up numbers, I’m not suggesting that in any way, but we do respond to more Fair Work claims than anyone else would do.
“Our volume of clients means we see roughly speaking 40 to 50 claims made against our clients a week. That number has gone up slightly, but by about 15 to 20 per cent.”
Speaking about the GFC, he explained that unfair dismissal claims actually dropped during that period on the back of a shared sense of misfortune.
“Doing employment law during the GFC, what I saw in the UK was actually unfair dismissal claims went down, in that people getting dismissed sort of looked at their neighbour who had also been dismissed and said, ‘Maybe we’re all just getting dismissed, I’m not going to sue for it.’
“But there was an uptick in discrimination claims during the GFC. So maybe we will see that here.”
Earlier this month, data from the Australian Bureau of Statistics revealed that a total of 594,300 people lost their jobs in April alone, with hours worked dropping at a record pace.
The ABS revealed that total hours worked fell by around 9.2 per cent in April, meaning that, when taken together with people leaving the workforce, around 2.7 million people either lost their job or had their hours reduced between March and April.
According to the Treasury’s predictions, unemployment will hit its peak at 10 per cent by end-June.