FWC warns against blind reliance on AI as worker ordered to pay employer’s costs
We continue to see a growing trend of self-represented litigants using generative artificial intelligence (AI) to prepare unfair dismissal and general protections claims. While AI can be a useful tool, the Fair Work Commission (Commission) has highlighted the risks of relying on AI-generated information without independently checking its accuracy and relevance.
In a recent decision, the Commission ordered an employee to pay $1,230 towards his former employer’s legal costs after finding his unfair dismissal application had no reasonable prospects of success because he did not meet the eligibility criteria.
Key facts
The applicant, Mr Sadnan Khan, commenced employment with his employer on 29 September 2025.
On 26 March 2026, his employer informed him that his employment was terminated and provided him with one week’s pay in lieu of notice. Later that same day, Mr Khan lodged an unfair dismissal application with the Commission.
Eligibility Criteria for Unfair Dismissal
Under section 382(a) of the Fair Work Act 2009 (Cth) (FW Act), a person is protected from unfair dismissal if, at that time, the person has completed a period of employment of at least the “minimum employment period”. “Minimum employment period” is defined under section 383(a) of the FW Act to be 6 months (where the employer is not a small business).
The key issue in Mr Khan’s case was whether he had completed the 6-month minimum employment period required to bring an unfair dismissal claim.
Mr Khan argued that he had completed six months’ service because his employment continued throughout his notice period and effectively ended when that period expired.
However, section 383(a) of the FW Act requires the minimum employment period to be calculated by reference to the earlier of:
- the time the employee is given notice of dismissal; or
- immediately before the dismissal occurs.
In Mr Khan’s case, he was notified of his dismissal on 26 March 2026, just three days short of completing six months’ service.
Key findings
The Commission’s warnings
What makes this decision unusual is the extent to which the Commission attempted to assist the applicant before the hearing. A week before the hearing, Deputy President Easton wrote to Mr Khan in plain English explaining:
- why the claim was unlikely to succeed;
- why he appeared not to meet the minimum employment period;
- that he should consider discontinuing the application; and
- that continuing the matter could expose him to a costs order.
The Deputy President later sent a second, even more direct email explaining that the date he was paid in lieu of notice was irrelevant and that there was a “very strong likelihood” the claim would fail.
The Commission’s view was that these explanations were clear and practical for a self-represented litigant.
The role of AI
The Deputy President acknowledged that using AI is not inherently unreasonable, stating at paragraph [54] that:
“Using AI to assist in drafting correspondence and even submissions is not, of itself, unreasonable. Artificial intelligence, in 2026 at least, is a drafting tool that can assist litigants when used properly.”
However, the Commission found that Mr Khan appeared to rely on AI as a “quasi-legal advisor” and blindly submitted AI-generated material that focused on the wrong legal question. Even after the Commission clearly identified the correct legal issue, the AI-assisted submissions continued to argue about the date the dismissal took effect, rather than the date the employee was notified of the dismissal.
The Deputy President was particularly critical of the fact that Mr Khan seemingly adopted AI-generated arguments without checking them against the legislation, publicly available Commission guidance, or the direct explanations he had received from the Commission.
The outcome
At the hearing, after the Deputy President again raised the minimum employment period issue, Mr Khan ultimately accepted that he had not completed the required six months of service. He then discontinued his unfair dismissal application.
Mr Khan’s employer sought a costs order, to which the Commission found that:
- Mr Khan acted unreasonably by continuing the claim after being clearly informed that it had no substantial prospects of success; and
- his conduct directly caused his employer to incur unnecessary legal costs preparing for and attending the hearing.
The Commission ordered Mr Khan to pay $1,230 towards his former employer’s legal costs. While the amount was relatively modest, the Deputy President noted that the employer had incurred significantly higher legal expenses. At paragraph [67] of the judgment, the Commission noted that:
“The risk of a costs order should have deterred him from continuing. The making of a costs order will now deter Mr Khan, and hopefully other applicants in the same position, from acting unreasonably.”
How can NRA Legal assist?
The increasing use of generative AI is contributing to a continued increase in workplace claims being lodged with the Commission.
If you receive a claim, NRA Legal can assist at every stage of the process, including preparing and filing the response, advising on the conciliation process and the prospects of success, and representing employers before the Commission at both conciliation conferences and hearings.
If you would like to discuss our services, or any of the content in this article, please call NRA Legal for a confidential conversation on 1800 572 679.
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