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FWC finds employee resignation was not a constructive dismissal

When conducting a disciplinary process, it is crucial to ensure that a final decision on disciplinary action is not made until the employee is given a proper opportunity to respond to any allegations made against them.

When conducting a disciplinary process, it is crucial to ensure that a final decision on disciplinary action is not made until the employee is given a proper opportunity to respond to any allegations made against them.

This is because one of the factors that the Fair Work Commission (FWC) will consider in an unfair dismissal application is whether the employee was provided with what is known as “procedural fairness” or an opportunity to explain their version of events.

In addition to this, it minimises the risk of an employee successfully claiming that the dismissal was an inevitability and they therefore had no choice but to resign, as they were going to be dismissed regardless of what they said in the disciplinary process.

Take, for example, the recent decision of the FWC in Dellicastelli v Healius Pathology Pty Ltd t/a Dorevitch Pathology [2022] FWC 2747.

In this matter, a former employee claimed that she had been forced to resign (or “constructively dismissed”) from her employment because of the conduct of her employer during a disciplinary process, amongst other things.

The disciplinary process concerned allegations that she would make persistent and intimidating telephone calls to her team members, during which she would yell at them.

The employee had learnt from her union representative that the employer was going to dismiss her as a result of her conduct. However, the employer’s human resources manager rang the employee and confirmed that she would not be dismissed but other disciplinary action would be taken instead. The human resources manager also discussed the employee’s unrelated request to cash out two weeks of her annual leave – clarifying that the employer would not agree to the request, but that if she decided to resign, all of her accrued leave would be paid out.

The employee subsequently handed in her resignation, citing her conversation with the human resources manager in which he allegedly indicated that the best thing for her would be her immediate exit from the company.

The employer objected to the employee’s application for unfair dismissal on the basis that she had not been constructively dismissed; rather, she had freely resigned on her own initiative.  

The FWC agreed with the employer, finding that, on the employee’s own evidence, the human resources manager never told her that she should immediately exit the company but that she had inferred this from his tone. It found that even if the human resources manager did say or imply that it was in the employee’s best interests to resign, the employee had no obligation to do so as she could have simply ignored him or contacted her union to seek advice.

The FWC also found that the human resources manager’s statement that the employee’s accrued leave would be paid out if she resigned was not a means of pressuring her to resign. The FWC considered it was a reasonable observation to make and it was not a proposal to dismiss her.

The FWC therefore found that the employee voluntarily made the decision to resign from her employment and the employer did not engage in any conduct which caused her to do so. It therefore dismissed the employee’s application.

Lessons for employers

It is important that employers carefully consider their communications with an employee during the course of a disciplinary process.

As can be seen from this decision, clear and transparent communication will assist an employer in proving that an employee was provided with procedural fairness during the disciplinary process and minimise the risk of an employee being found to have been constructively dismissed.

Information provided in this blog is not legal advice and should not be relied upon as such. Workplace Law does not accept liability for any loss or damage arising from reliance on the content of this blog, or from links on this website to any external website. Where applicable, liability is limited by a scheme approved under Professional Standards Legislation.

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