A termination is unlawful when it is done without the notice section 34 requires, without payment in lieu, and without a section 36 ground. This article deals with what follows.
The ordinary measure of damages
Where an employment contract has been terminated without the required notice, the ordinary measure of damages is the sum the employee would have earned during the notice period that should have been given — because the employer was entitled to end the contract lawfully by giving that notice.
So for an employee of three years’ service on a contract silent as to notice, the section 34(4) period is two weeks, and that is the measure. Where the contract provides a longer notice period, the contractual period governs — section 34(3) requires notice to be as specified in the contract or not less than the statutory minimum.
Where the contract is for a specified period and contains no right to terminate early, the loss is measured by the unexpired balance of the term, not by a notice period. That is why the length and the termination clause of a fixed-term contract matter so much.
And remember section 22(2): if the employee was permitted to work on after the term expired, the contract is deemed extended for an unspecified period, and the notice measure applies again.
What is owed regardless of lawfulness
These are debts, not damages, and they are payable whether or not the termination was lawful:
- Wages to the last day worked — Part V.
- Accrued recreation leave, or money instead of it.
- Any deferred wages held by the employer — section 90.
- Refund of repatriation deductions — section 90(2).
- Public holiday pay where the employment ended on the day immediately preceding a public holiday — section 86(3).
- Outstanding overtime, stand-by and call-out.
- Repatriation, where Division 7 applies.
An employer sometimes withholds final pay pending “an investigation” or as a set-off. Section 96 makes it an offence to fail, without reasonable excuse, to pay wages due on demand, and section 38(1)(a)(ii) shows that even on an attested contract deferred wages may be retained only if a court authorises it.
Section 38 — the wider award on an attested contract
A court may award an employee such amount as it determines of the value of loss of wages, allowances and any other expense to the employee caused by any wrongful act or default of the employer or of a person acting on his behalf or by his authority.
The award is deemed to be a judgement debt, and may be set off against any award made to the employer under section 38(1)(a).
Section 39 confirms that an order under the Division takes effect notwithstanding anything to the contrary in the Act, and that the Division does not prevent proceedings under another law — though amounts recovered count towards satisfaction of a judgment obtained elsewhere.
Where the employer is a public body
The Act binds the State and every authority and instrumentality of the State (s 2). Where a public authority makes the decision, two further sources of law may apply:
- Section 59 of the Constitution — the principles of natural justice, the minimum requirement being to act fairly and, in principle, to be seen to act fairly.
- Section 41 of the Constitution — an act that is harsh or oppressive, or disproportionate, or otherwise not reasonably justifiable in a democratic society, is unlawful even if specifically authorised by law.
Note also section 3(1)(b): except where specifically provided, the Employment Act does not apply to employment under any other law — so public servants employed under the Public Services (Management) Act 1995 are governed by that scheme and its own review process.
Reinstatement, and why it is rare
The common law does not ordinarily compel an employer to keep an employee it does not want; damages are the usual remedy for wrongful dismissal. Reinstatement is more realistically available:
- through the industrial process — section 36(4) preserves the right to make the termination an industrial dispute under the Industrial Relations Act; or
- where a statutory office or a public sector scheme provides for it, or where the decision is quashed on judicial review.
What to prove, and how
| Issue | Evidence |
|---|---|
| The contract and its terms | The signed contract, or the section 15(1) record — and if the employer has no record, your statement is conclusive under s 15(2) |
| Length of service | Pay statements, roster, first payslip, s 22(3) commencement rule |
| The rate | Section 82 statements; the s 83 wages register |
| How it ended | The letter or message; witnesses; the date; whether a ground was stated |
| Amounts unpaid | Leave records, deferred wage records, overtime records under s 57 |
| Mitigation | Your record of looking for other work |
In a non-criminal proceeding under the Act, the National Court or a District Court shall be guided by equity and good conscience and is not bound by the rules of evidence and legal procedure. Dated notes, photographs of a roster board and phone messages can be put before the court.
Steps to take
- Ask for the reason and the date in writing, immediately.
- Demand final pay in writing, itemised — wages, leave, deferred wages, overtime, repatriation.
- Collect your documents before you lose access to the workplace.
- Report it to a labour officer, and ask the Secretary to consider proceedings under section 145(a) and appearance on your behalf under section 145(c).
- If you are a union member, raise it as an industrial dispute under section 36(4).
- Keep looking for work and record the search — damages are reduced by what you earn or could reasonably have earned.
- Get advice promptly — the Public Solicitor, or a firm from the law firms directory. Time limits apply to court proceedings, and to claims against the State in particular.
Sources
- Employment Act (Chapter 373) — ss 2, 3, 15, 22, 34–39, 57, 82, 83, 86, 90, 96, 145, 149
- Constitution — ss 41, 59
- Public Services (Management) Act 1995
- Industrial Relations Act — PacLII 1986 Revised Edition
- Porgera Joint Venture v Kami [2010] PGSC 11; SC1060
- Sukuramu v New Britain Palm Oil Ltd [2007] PGNC 21; N3124
- Murua v Ramu Nico Management (MCC) Ltd [2013] PGNC 28; N5092
- Tawa v Mainland Holdings Ltd [2020] PGNC 469; N8727
Before relying on anything here, read the current text of the Employment Act (Chapter 373) and check for later amendments. If a decision matters to you, get advice — start with the Office of the Public Solicitor, or find a firm in the law firms directory.