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Small business employers

Last updated October 2o26

This chapter explains when employer obligations differ for small businesses and what you need to do to comply with them.

What is a small business employer?

For the purposes of the Fair Work Act 2009 (Cth) (FW Act), a small business employer is a national system employer that employs fewer than 15 employees at a particular time.

Tip: When calculating how many employees you have at a particular time, exclude casual employees unless the employee is a regular casual employee (i.e. employed on a regular and systematic basis), but include employees employed by associated entities and employees who are being dismissed.

Case Law: Alison Garner v Redmako RTO T/A Red Aussie (2015)

In Alison Garner v Redmako RTO T/A Red Aussie (2015), Ms Garner filed an unfair dismissal claim in the Fair Work Commission. The employer objected, claiming it was a small business employer and the employee had not served the 12-month minimum employment period required to bring a claim.

The FWC found that while the employer only employed 14 employees at the time of Ms Garner's dismissal, an incorporated company based in the Philippines was an associated entity of the employer.

Given this, the incorporated company's employees were included in the count of employees used to determine whether the employer was a small business. The combined total of employees was more than 15, meaning that the employer was not a small business.

Therefore, the minimum qualifying period for Ms Garner to bring an unfair dismissal claim was only 6 months. As Ms Garner had been employed for more than 6 months, she could continue with her unfair dismissal claim.

Read more on this case here.

When do small businesses have different obligations or rights from other businesses?

The legal rights and obligations of small business employers can be different from those of other employers in some ways, including in relation to:

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