A summary dismissal is the exercise of an election by the employer to terminate the employment contract in response to repudiation by the employee, and an election to terminate puts an end to the contract at the time the termination is communicated to the other party.

The Full Bench endorsed the approach that an employer's reasonable belief test focuses on whether the employer held the belief and whether there are reasonable grounds for it, not on whether the belief was ultimately correct.

For summary dismissal under the Small Business Fair Dismissal Code, there are two steps: first, whether the employer held a belief that the employee's conduct was sufficiently serious to justify immediate dismissal; secondly, whether that belief was based on reasonable grounds, which incorporates the concept that the employer carried out a reasonable investigation. It is not necessary to determine whether the employer was correct in the belief it held.

To assess whether a summary dismissal is consistent with the Small Business Fair Dismissal Code, there are two steps: (1) whether at the time of dismissal the employer held the belief that the employee's conduct was sufficiently serious to justify immediate dismissal; and (2) whether that belief was based on reasonable grounds, incorporating the concept that the employer carried out a reasonable investigation.

Acting reasonably does not require a single course of action; different employers may approach matters differently and form different conclusions while still acting reasonably. The legislation requires consideration of whether the particular employer carried out a reasonable investigation and reached a reasonable conclusion in all circumstances, including the experience and resources of the small business employer.

It is not necessary to determine whether the employer was correct in the belief it held regarding whether an employee's conduct was sufficiently serious to justify immediate dismissal. However, the belief must be based on reasonable grounds, and often it will be necessary to put the allegations to the employee and consider their response.

The test for summary dismissal under the Small Business Fair Dismissal Code requires the employer to establish: (i) that the employer did in fact hold the belief that the conduct was by the employee, was serious, and justified immediate dismissal; and (ii) that there are reasonable grounds for the employer holding that belief, ordinarily requiring an establishment of what inquiries or investigations were made.

The function of the FWC in applying the Small Business Fair Dismissal Code is not to determine on the evidence whether there was a valid reason for dismissal, but rather to determine whether there were reasonable grounds on which the respondent reached the view that the applicant's conduct was serious enough to justify immediate dismissal, based on the knowledge available to the employer at the time of dismissal.

Where the Small Business Fair Dismissal Code applies, there are different considerations; the Code requires that the employer had reasonable grounds to reach the view that the applicant's conduct is serious enough to justify immediate dismissal; s.396 of the Act requires the determination whether the dismissal is consistent with the Code before considering merits.

For the summary dismissal provisions of the Small Business Fair Dismissal Code, there needs to be consideration whether the employer held a belief that the employee's conduct was sufficiently serious to justify immediate dismissal and whether that belief was based on reasonable grounds; the element of reasonable grounds incorporates the concept that the employer has carried out a reasonable investigation into the matter.

In assessing summary dismissal under the Small Business Fair Dismissal Code, there are two steps: first, whether the employer held a belief that the employee's conduct was sufficiently serious to justify immediate dismissal; second, whether that belief was based on reasonable grounds, which incorporates the concept that the employer carried out a reasonable investigation. It is not necessary to determine whether the employer was correct in its belief.

In assessing a summary dismissal under the Small Business Fair Dismissal Code, there are two steps: first, whether the employer held a belief that the employee's conduct was sufficiently serious to justify immediate dismissal, and second, whether that belief was based on reasonable grounds. The second element incorporates the concept that the employer has carried out a reasonable investigation. It is not necessary to determine whether the employer was correct in its belief. Acting reasonably does not require a single course of action and different employers may approach matters differently, but the legislation requires consideration of whether the particular employer, in its circumstances, carried out a reasonable investigation and reached a reasonable conclusion.