The Cost of Disgruntled Employees – When to Sensibly Settle?

Led by Senior Associate Rebecca Richardson from the Employment Law & Investigations team, the July 2025 edition of the HR Breakfast Club focused on assisting HR practitioners in effectively managing workplace disputes and making informed decisions about when to resolve matters early. Below is an overview of the key takeaways:

The Importance of Early Assessment and Management of Workplace Disputes

Workplace disputes, if not addressed promptly, can escalate into costly and time-consuming litigation. Early assessment and management are critical to minimising the hidden and direct costs associated with unresolved grievances, such as lost productivity, diminished team morale, legal fees, and reputational damage.

Options for Employers When Disputes Arise

When a workplace issue arises, employers generally have three options:

• Resolve the dispute at the workplace level by addressing employee concerns or making payments if owed.
• Make offers to settle the matter.
• Choose not to make offers to settle, particularly if the claim appears vexatious or lacks merit, or wait for the employee to file a formal claim before considering settlement.

Key Considerations for Decision-Making

Employers should consider the following factors when deciding how to proceed:

• Potential legal liability and the value of the claim. Certain issues may signal the likelihood of legal action, including:
  • Complaints about incorrect pay or entitlements.
  • Allegations of bullying, discrimination, or sexual harassment.
  • Workplace injuries, particularly long-term mental health injuries.
  • Disgruntlement following termination of employment.
  • Combative behaviour from employees.
• The number of employees involved and the risk of multiple claims.
• The sensitivity of the subject matter and potential reputational risks.
• Applicable rules, such as employee contracts, awards, enterprise agreements, and workplace policies. In some cases, resolving the matter may be more practical than adhering to onerous procedural requirements.

As always, it is important to get legal advice early to assist you in assessing the risks involved and facilitating early resolution of workplace disputes where possible.

About Us

If you are an HR professional and would like to attend our future HR Breakfast Club forums, please visit our monthly forum page and register to attend.

If you have any questions or queries about the information in this summary, or if you are experiencing any issues and need advice, please contact the BAL Lawyers Employment & Investigations team on 02 6274 0999.