Terminating employment

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Overview

Subsection 29(1) of the Public Service Act 1999(PS Act) provides that an Agency Head may at any time terminate the employment of an Australian Public Service (APS) employee in the agency, by notice in writing.

Any decision to terminate employment must be consistent with:

  • the PS Act and subordinate legislation
  • the Fair Work Act 2009(FW Act), including in relation to unfair dismissal and adverse actions
  • other employment and administrative law, including in relation to procedural fairness and
  • any relevant employment instruments.

When an APS employee moves to a new agency under section 26 of the PS Act, this agency becomes the employee’s current agency (the employer), even if it is on a temporary basis. An APS employee in the agency:

  • includes employees who are currently employed in the agency on a temporary transfer made under section 26 of the PS Act
  • does not include employees who normally belong to the agency but are on temporary transfer to another APS agency.

Ongoing APS employees

In accordance with subsection 29(3) of the PS Act, the decision to terminate the employment of an ongoing APS employee can only be made on the following grounds:

  1. the employee is excess to the requirements of the agency
  2. the employee lacks, or has lost, an essential qualification for performing their duties
  3. non-performance, or unsatisfactory performance of duties
  4. inability to perform duties because of physical or mental incapacity
  5. failure to satisfactorily complete an entry-level training course
  6. failure to meet a condition of engagement imposed under subsection 22(6) of the PS Act
  7. breach of the APS Code of Conduct
  8. any other grounds prescribed by the Public Service Regulations 2023 (the PS Regulations).

In accordance with subsection 29(3)(h) of the PS Act, subsection 15(2) of the PS Regulations prescribes that a recommendation by the National Anti-Corruption Commission (NACC) to terminate the employment of an APS employee is a ground for termination.

In accordance with subsection 29(2) of the PS Act, the grounds for termination must be specified in the written notice of termination.

Excess to requirements

An agency’s employment instrument will detail the steps required when an employee or a group of employees are likely to become excess to the requirements of the agency.

Where an agency determines that an employee is excess to requirements, the employee may be made redundant (voluntarily, or involuntarily) under subsection 29(3)(a) of the PS Act. The FW Act sets out the minimum entitlement for an employee who is excess to requirements, therefore an agency should be referring to both the FW Act and its employment instruments to ensure the correct entitlements are provided. Further information is on the Fair Work Ombudsman (FWO) Redundancy website.

The Australian Public Service Commissioner’s Directions 2022 (the Directions) sets out certain limitations on the employment of a person who has received a redundancy benefit from an APS agency or the Australian Parliamentary Service, where their ‘redundancy benefit period’ has not expired.

Further information on the redundancy benefit period is on the Engagement of People who have Received a Redundancy Benefit page.

Where an employee lacks, or has lost, an essential qualification

An Agency Head may terminate employment due to the employee’s loss of an essential qualification. An essential qualification can include a formal educational or vocational standard that is necessary to perform a particular set of duties. It can also refer to, for example, professional accreditation, a driver’s licence, a security clearance, or a prescribed level of physical fitness.

Where an essential qualification is required, this should be made clear prior to the employee accepting the new role.

Non-performance, or unsatisfactory performance, of duties

The APS Employment Principles in section 10A of the PS Act provides that the APS is a career-based service that requires effective performance from each employee. Sections 49, 50 and 51 of the Directions prescribe how effective performance is achieved.

Non-performance of duties

Non-performance of duties includes situations where an employee has:

  • taken an unauthorised absence and has not responded satisfactorily to reasonable attempts by the agency to have them return to duty or
  • attended the workplace but is not undertaking the assigned duties.

An unauthorised absence also includes where the employee was granted leave but has not returned to work at the end of the period of approved leave. An unauthorised absence can give rise to an ‘abandonment of employment’ situation.

In considering whether to terminate the employment of an employee because of an absence from work, an agency will need to have regard to:

  • section 352 of the FW Act, which prohibits termination of employment where an employee is temporarily absent from work because of illness or injury of a kind prescribed by the FW Regulations and
  • obligations under the FW Act in relation to procedural fairness.

Agencies are advised to seek legal advice before proceeding with termination of employment in these circumstances.

Unsatisfactory performance of duties

Terminating the employment of an ongoing APS employee on the grounds of unsatisfactory performance of duties should be handled as part of an agency's performance management process.

An agency’s procedures for managing non-performance or unsatisfactory performance should have regard to procedural fairness and outline the circumstances where termination of employment is likely to be considered. Agencies are encouraged to ensure that performance management policies contain:

  • provisions for employees to be notified about unsatisfactory performance, and
  • reasonable opportunities for the employee to improve performance.

Underperformance cases should be managed in accordance with the relevant agency procedures. Failure to do so could result in the Fair Work Commission (FWC) or another review body determining that any decision to terminate employment should be set aside and the employee reinstated to their original position.

Termination of employment during probation is normally actioned under provisions in relation to failure to meet a condition of engagement.

Further information on performance management in the APS is on the Performance page.

The Australian Government Solicitor’s 2020 Legal Briefing 114 Dealing effectively with unsatisfactory performance in the Australian Public Service provides information on the management of underperformance cases.

Inability to perform duties because of physical or mental incapacity

Termination of employment due to an inability to perform duties because of physical or mental incapacity raises complex issues. Agencies are advised to seek legal advice before proceeding with termination of employment in these circumstances.

The FW Act, anti-discrimination legislation and the legislation governing Commonwealth superannuation arrangements provide limitations on the powers of the Agency Head to terminate employment in these circumstances.

Where termination for this reason is being considered and the employee is a member of a Commonwealth superannuation scheme, agencies are encouraged to review the information available on the Commonwealth Superannuation Corporation website.

Failure to satisfactorily complete an entry-level training course

Terminating on the grounds of failure to satisfactorily complete an entry-level training course may be considered where the employee:

  • is engaged or assigned duties in a training classification or
  • is not in a formal training classification however
    • it was clearly advised that completion of the relevant training was the basis of their employment (including where the employee moves into a new role that requires them to undertake an entry-level training course) or
    • the requirement to undergo training is specified as a formal condition of engagement imposed under subsection 22(6) of the PS Act.

An employee should be notified of the requirement to complete an entry level training course prior to accepting the role. The notification should include:

  • at what stage in the training course a failure to meet certain requirements can potentially lead to termination of employment and
  • the grounds for termination.

Where failure to complete an entry level training course could also be a failure to meet a condition of engagement, agencies should consider which ground for termination is most appropriate.

Failure to meet a condition of engagement

An agency may terminate the employment of an employee where they fail to meet a condition of engagement.

An employee must be notified of any conditions of engagement prior to their commencement, for example in the letter of offer. This should provide information on how and by when, the condition of engagement must be satisfied and that failure to do so may result in the termination of their employment. Further information is on the Conditions of Engagement page.

Breach of the APS Code of Conduct

An Agency Head may terminate employment of an employee who has been found to have breached the APS Code of Conduct. A decision to terminate employment for a breach of the APS Code of Conduct must:

  • follow a determination that a breach has occurred in accordance with the procedures established under subsection 15(3) of the PS Act and
  • be notified in the Public Service Gazette (PS Gazette) in accordance with section 40(1)(e) of the Commissioners Directions. Further information on PS Gazette requirements is on the Public Service Gazette Requirements page.

Further information on APS Code of Conduct matters is on the Handling misconduct: a human resource manager's guide page.

Recommendation of the National Anti-Corruption Commission

Subsection 15(2) of the PS Regulations prescribes that it is a ground for the termination of the employment of an ongoing APS employee that an investigation report, within the meaning of the National Anti-Corruption‑ Commission Act 2022, includes a recommendation to terminate the employment of the APS employee. Agencies are expected to provide procedural fairness to an employee before a decision is made to terminate their employment on this ground.

Further information on the NACC is on the Attorney-General’s Department webpage, National Anti-Corruption Commission.

Non-ongoing APS employees

Where a person is engaged as a non-ongoing APS employee for a specified term, a specified task, or on an irregular or intermittent basis, the employment ceases at the end of the engagement period or at the completion of the task. In this circumstance, the employment has not been terminated for the purpose of the FW Act, and the employee is not entitled to notice of termination or redundancy provisions.

In accordance with subsection 29(4) of the PS Act and subsection 15(2) of the PS Regulations, a recommendation by the National Anti-Corruption Commission (NACC) to terminate the employment of a non-ongoing APS employee is a ground for termination.

Where an Agency Head terminates the employment of a non-ongoing employee, the FW Act may (depending on individual circumstances) provide an entitlement to:

  • notice or payment in lieu of notice in accordance with section 117 of the FW Act
  • compensation for early termination in accordance with section 119 of the FW Act.

The FW Act sets minimum entitlements, therefore an agency should be referring to both the FW Act and its own employment instruments to ensure the correct entitlement is provided. For further information visit the FWO Redundancy webpage.

Notice of termination or payment in lieu of notice

APS employees must be given notice of termination or payment in lieu of notice that is at least equal to the amount set out in the FW Act, unless the situation is excluded as prescribed in section 123 of the FW Act.

An employment instrument may provide an entitlement to a longer period of notice than is available under the FW Act.

SES employees

Additional requirements must be satisfied before the employment of a Senior Executive Service (SES) employee can be terminated.

Further information is on the Senior Executive Service – Ending Employment page.

Review of termination decisions

The FW Act is the principal review framework for termination of employment decisions, providing rules and entitlements including minimum periods of notice, protections against unfair dismissal and dismissals that are in breach of the general protections provisions of the FW Act.

There is no right of appeal or review under the PS Act or the PS Regulations for a decision to terminate the employment of an ongoing or non-ongoing APS employee.

A former employee has a right under section 72 of the PS Regulations to request an investigation of their separation entitlements.

APS employees may also be able to apply for judicial review of termination decisions on the ground of failure to comply with the requirements of administrative law.

Re-engagement of a former APS employee

An Agency Head may re-engage a former APS employee in accordance with section 38 of the Directions, if one of the following applies:

  • they are satisfied that the employment should not have ended
  • the engagement will settle legal action relating to the termination of the employee’s employment or
  • an appropriate authority has recommended or ordered the reinstatement of the person.

Appropriate authorities include the Federal Court of Australia, the FWC and the Australian Human Rights Commission.

In this circumstance, the employee would be engaged on the same basis that they were previously employed, either as ongoing or non-ongoing‑ and at the same or lower classification.

An engagement in these circumstances is not subject to the merit requirements outlined in sections 23A and 24 of the Directions.

Further information

HR practitioners seeking more information on the provisions within the PS Act relating to terminating employment can contact the Employment Policy team via employmentpolicy@apsc.gov.au or call the advice line on (02) 6202 3857.

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