Although excessive use of social media during work hours may be a valid reason for terminating an employee's employment, Fair Work Australia has found that a landscape architect who was accused of making over 3,000 transactions on a chat line during work time within a three month period was unfairly dismissed.

According to Fair Work Australia, the employer had failed to comply with its obligations under the Fair Work Act 2009 (Cth) and the dismissal was harsh, unjust or unreasonable.

Richard O'Connor commenced employment with Outdoor Creations in Melbourne in January 2009 and he gave notice that he intended to resign earlier this year, with his resignation due to take effect on Friday, 11 February 2011.

On Thursday, 10 February 2011 the employer reviewed its computer systems and formed the view that Mr O'Connor had conducted over 3,000 personal on-line chat transactions within the previous three months and been streaming on line when he should have been working. He had also forwarded copyright protected landscape architectural plans to an external email address and altered completed landscape architectural plans to show himself as the designer.

Outdoor Creations terminated Mr O'Connor's employment on Friday 11 February 2011, although that was his last day of work with the firm due to his notice of resignation.

Outdoor Creations is a "small business employer" as it employed fewer than 15 employees at the time of the dismissal.

To determine whether an employer is a small business employer at the time of a dismissal requires a head count of employees with two rules. These are that all employees, including the dismissed employee, are to be counted (including casual employees, but only those employed on a regular and systematic basis) and employees of any associated entities of the employer are to be counted.

A small business employer must comply with the Small Business Fair Dismissal Code which allows for summary (on-the-spot) dismissal for serious misconduct.

In other cases, the Code requires a small business employer to give the employee a valid reason for the dismissal based on the employee's conduct or capacity to do the job. The employer must also warn the employee verbally or preferably in writing of the risk of dismissal if there is no improvement and provide the employee with an opportunity to respond to the warning and give the employee a reasonable chance to rectify the problem, having regard to the employee's response.

Fair Work Australia determined that Outdoor Creations did not have sufficient evidence to establish that Mr O'Connor was in fact guilty of misconduct, it did not put any of the allegations to Mr O'Connor and he was given no opportunity to respond to those allegations. It was also determined that neither party had provided independent evidence about the extent of the employee's use of social media and the internet.

As Mr O'Connor's employment would have ended on 11 February 2011 due to his resignation, Fair Work Australia determined that he had suffered a loss of only one days pay and he was awarded one days pay less taxation.

This case reinforces the importance of complying with the Fair Work Act at all times when an employer is considering terminating an employee's employment.

This case also reinforces that all employers should consider introducing a social medial policy. Employers will have different views on the extent to which they are prepared to allow their employees to use social media during work hours. Some employers actively encourage the use of social media. For other employers, the use of social media is almost totally prohibited.

Bearing in mind those differences, a social media policy should prohibit employees from excessive use of social media during work hours and define the concepts of "reasonable use of social media during work hours" and "excessive use of social media during work hours" through objective, quantifiable measures. The policy should also make it clear that a breach of the policy may result in disciplinary action being taken, which may include termination of employment and make it clear that the employer is monitoring the employee's use of social media.

For employers in the Federal industrial relations system that are not small business employers, the issues that will be considered by Fair Work Australia in determining whether the termination of an employee's employment was harsh, unjust or unreasonable may include issues such as whether there was a valid reason for the termination related to the person's capacity or conduct (including its effect on the safety and welfare of other employees). They may also consider whether the employee was notified of that reason and whether the employee was given an opportunity to respond to any reason related to the capacity or conduct of the person.

Other issues that will be deliberated include any unreasonable refusal by the employer to allow the employee to have a support person present to assist at any discussions relating to termination. Also, if the termination related to unsatisfactory performance by the employee - whether the employee had been warned about that unsatisfactory performance before the termination.

Finally, Fair Work Australia will weigh up the degree to which the size of the employer's enterprise would be likely to impact on the procedures followed in effecting the termination and the degree to which the absence of dedicated HR management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal and lastly, any other matters that Fair Work Australia considers relevant.