Caveat emptor; this is very dry; how and when does a dismissal take effect?

When and how does a dismissal take legal effect?

At common law, a contract of employment may unilaterally be terminated by the employer with notice or by way of a summary dismissal. The general principle is that to effect the termination of a contract of employment, an employer must, subject to any express provision in the contract, communicate to the employee by plain or unambiguous words or conduct that the contract is terminated. Where the communication is in writing, the communication must at least have been received by the employee in order for the termination to be effective. 3 Where notice is given of the termination of the employment contract, then the contract will terminate at the end of the period of notice specified in the communication to the employee.4 The principles in this respect were summarised by the Supreme Court of NSW (White J) in Fardell v Coates Hire Operations Pty Ltd5 as follows:
“[82] To be effective, a notice of termination of a contract of employment must specify a time when termination is to take effect, or that time must be ascertainable (G J McCarry, Termination of Employment Contracts by Notice (1986) 60 ALJ 78 at 79; Burton Group Ltd v Smith [1977] IRLR 351 at 354). The notice is to be construed according to how it would be understood by a reasonable person in the position of the recipient who had knowledge of the background of the dealings between the parties (Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd [1997] UKHL 19; [1997] AC 749 at 767-768; Carter v Hyde [1923] HCA 36; (1923) 33 CLR 115 at 126; Prudential Assurance Co Ltd v Health Minders Pty Ltd (1987) 9 NSWLR 673 at 677; Fightvision Pty Ltd v Onisforou [1999] NSWCA 323; (1999) 47 NSWLR 473 at [99]).”
[18] A notice of termination may validly operate notwithstanding that it is stated to take effect subject to a condition, provided that the notice is expressed with sufficient certainty so that conditional date of termination is ascertainable, the condition upon which the termination becomes operative has been fulfilled and the employee is in a position to know that the condition has been satisfied. 6
[19] When the termination occurs without notice on the basis that a sum of money is paid in lieu of the notice that would otherwise be required, then the termination would take effect when communicated to the employee subject perhaps to the additional requirement that the amount in lieu of notice has actually been paid to the employee. 7
[20] A termination of employment may also occur by way of a summary dismissal. In contractual terms, a summary dismissal is to be characterised as the exercise of an election by the employer to terminate the employment contract in response to a repudiation of the employment contract by the employee constituted by a breach of an essential term, a serious breach of a non-essential term, or conduct on the part of the employee manifesting an intention not to be bound by the contract in the future. An election to terminate a contract on this basis puts an end to the contract at the time the termination is communicated to the other party. 8
[21] In Stevanovski v Linfox Transport 9 the Australian Industrial Relations Commission (Lacy SDP) rejected the proposition that at common law an employment contract could be terminated with effect from a date prior to that upon which the termination was communicated to the employee:
“[47] The notion of the termination of an employment contract retrospectively, as seems to be the purport of the letter of 9 October 2000, is inconsistent with the rule of law to the effect that the giving of a notice terminating a contractual employment, whether by employee or employer, is the exercise of the right under the contract of employment to bring the contract to an end, either immediately or in the future: Riordan v. War Office (1959) 1 WLR 1046 per Diplock J. When the respondent called the applicant to come to work on 9 October 2000, and decided to terminate his employment, it was entitled to terminate his employment either upon notice or with immediate effect. It did neither of those things. It terminated his employment with effect from a prior date. It would appear that the applicant might have been deprived of one day’s pay as a result of the respondent’s retrospective termination of his employment.”
[22] It is conceivable that a contract of employment might expressly provide for its termination by the employer immediately without the termination first being communicated to the employee. However, other than in that circumstance, it is difficult to contemplate that an employment contract could ever terminate retrospectively even by agreement between the employer and the employee. 10
[23] Notice of termination of employment may be given to an agent of an employee who has actual or ostensible authority to receive that notice. 11
[24] We now turn to the proper construction of s.394(2)(a) itself. It may immediately be observed that the provision which operates by reference is concerned with the date of effect of the dismissal. Section 386(1), which we have earlier set out, makes it clear that a dismissal for the purpose of Pt.3-2 of the FW Act is constituted by the termination of the employment relationship. As was observed by the High Court in Visscher v Giudice 12 the termination of an employment relationship and the termination of an employment contract are different concepts, and a wrongful dismissal from employment may not be effective in discharging the contract if the employee elects not to accept the employer’s repudiatory breach. This will rarely be of legal significance, since the employee will not after dismissal be entitled to remuneration if he or she keeps the contract on foot, and will not other than in exceptional circumstances be able to obtain specific performance of the contract.13 This led it to be said in Byrne v Australian Airlines Ltd14 that “[t]he possible continuation of the contract of employment after a wrongful dismissal will, therefore, ordinarily be of no real significance as it will for all practical purposes be at an end”. There is no reason to conclude therefore that the relevant legal principles applicable to the termination of the employment contract which we have earlier summarised would not equally be applicable to the termination of the employment relationship.
[25] The unfair dismissal regime in Pt.3-2 of the FW Act applies to “national system employees” and “national system employers”: s.380. Those expressions are defined in ss.13 and 14 respectively. National system employees are employees of national system employers, being employers which bear certain characteristics such as to make them amenable to particular heads of the legislative power of the Commonwealth in s.51 of the Constitution. Beyond this, the FW Act does not seek to establish a statutory definition of what constitutes an employee; national system employees for the purposes of Pt.3-2 are otherwise parties to an employment relationship at law. Presumptively therefore the common law principles concerning when a termination of employment by the employer takes effect are applicable to s.394(2)(a) in the absence of any express statutory provision deeming when a dismissal takes effect.
[26] Decisions under the FW Act and its statutory predecessor, the Workplace Relations Act 1996 (WR Act), have approached the question of when a termination of employment takes effect in a manner consistent with the common law principles earlier identified. Under the WR Act, the issue was the subject of the most significant analysis in the AIRC Full Bench decision in Commonwealth of Australia (Australian Taxation Office) v Wilson. 15 In that matter an application had been made under s.170CE(1) for relief in respect of a termination of employment. The employer contended that the application was beyond the jurisdiction of the AIRC because of the exclusion applicable to probationary employees effected by s.170CC(1)(a) and reg.30B(1)(c) of the Workplace Relations Regulations. The employee’s probation period ended on 21 May 2000. The employer sent her a letter by registered post on 19 May 2000 informing her that her employment was terminated effective that day, but the letter was not received by the employee until 22 or 23 May 2000. The question was whether the employee was serving a period of probation at the time of the termination of employment. The Full Bench said:
“[11] Counsel for the Commonwealth referred us to a number of authorities but conceded that there are few on point. One decision which appears to us to bear directly on the issue is Transport Workers’ Union of Australia v National Dairies Limited (1994) 57 IR 183. In National Dairies Keely J, sitting in the Industrial Relations Court of Australia, was required to decide whether the employment in question terminated before or after the date on which legislation providing statutory remedies for unfair dismissal commenced to operate. In the course of his judgment His Honour said:
“It was accepted by the respondent’s counsel, for the purpose of the present hearing, that the employer’s letter of purported termination was not received by the applicant until 30 March 1994. In my opinion the mere posting of the letter of termination does not in itself amount to a termination of the employment of the employee concerned until its contents are communicated to the employee. I am unable to uphold the respondent’s submission that the intention of the legislature was to make it a contravention of the Act for an employer to perform actions ‘pursuant to which the employer seeks to terminate an employee even if that wish is never communicated to the employee ie even if a letter of termination posted by an employer is never received by the employee.”
With respect we agree with His Honour’s conclusion. Whilst it is clear that a contract can be terminated unilaterally, it is beyond contemplation, unless there is special provision in the contract to the contrary, that a contract could be terminated without communication of the termination to the other party. We think that at common law, where termination occurs by letter, generally the termination is not effective until the letter is received. There may be a qualification to that general position. It may be that, in some circumstances, a termination is effective when its communication could ordinarily be expected to have been received. If an employer has attempted in good faith to communicate the termination and the Commission forms the view that the employee has deliberately avoided receipt of such communication, it may be arguable that in such circumstances termination occurred despite the fact that it has not physically been communicated to the employee. Those circumstances did not, however, exist in this matter and we therefore refrain from further discussion of the point.
[12] The Commonwealth seeks to meet this argument. It submits that while the termination could not occur until the respondent received the termination letter, once the letter was communicated the termination operated according to the terms of the letter. Relevantly the letter specified Friday 19 May 2000 as the date of termination. The Commonwealth submits that while the termination did not operate until at least 22 May 2000, once it operated it was effective from 19 May 2000 and within the probationary period.
[13] We reject this submission. We do so primarily because its adoption has the potential to frustrate the operation of the legislation. It would permit a party to select an operative date for termination which bore no relationship to the date on which the termination was to be communicated to the other party. A range of examples could be constructed but it is sufficient to mention only one. We are not prepared to construe the statutory provisions in a way which would permit an employer to deprive an employee of a right of action pursuant to s.170CE (subject to the discretion in s.170CE(8) to receive an application lodged out of time) by delivering a letter purporting to terminate the contract 3 weeks earlier. Whilst this may be thought a fanciful example, the meaning of the word “termination” in s.170CE(1) is a legal question which must be answered consistently regardless of the facts of the case. It seems to us that in a case of this kind “termination” must be construed to refer to the date on which the termination is communicated to the employee. The same conclusion was reached by Senior Deputy President Williams in Grzelka v Peel Training and Employment (Inc) [Print T3393] at para [13].
[14] We note that a similar conclusion was reached by a Full Bench of the Commission in Burns v Aboriginal Legal Service of Western Australia (Inc) [Print T3496 esp. at para 24]. That case was concerned with the question of whether to accept an application which had been lodged out of time. The date of termination was relevant in order to calculate the number of days by which the application was out of time. It is submitted by the Commonwealth that cases involving a consideration of whether an application lodged out of time should be accepted are to be distinguished from the present case because of the terms of s.170CE(7). That section reads:
“An application under subsection (1) or (3) must be lodged within 21 days after the day on which the termination took effect.”
While we doubt whether any relevant distinction can be made between the meaning of the expression “termination” in s.170CE(1) and the meaning of the expression “termination took effect” in s.170CE(7) this is not a matter which requires resolution in this case. We have reached our decision independently of the decision in Burns by construing the expression “termination” in s.170CE(1).”
[27] The Full Bench went on to consider a separate submission that the employee’s employment terminated earlier than when communicated because of the operation of s.29 of the Public Service Act 1999 (Cth). The Full Bench said:
“[15] We turn now to the submission based on s.29 of the Public Service Act 1999. We can find nothing in the terms of the section to support the suggestion that an Agency Head may terminate employment in such a way as to render the termination effective prior to its communication to the employee. It is to be inferred, therefore, that the legislature was using termination in its usual sense at common law. But even if it were supposed that the letter took effect according to its terms and that the termination occurred for the purposes of the Public Service Act 1999 on 19 May 2000, that could not affect the outcome here. For the purposes of s.170CE(1) of the Workplace Relations Act 1996 the termination occurred when the notice was received on 22 May 2000.”
[28] We understand that conclusion to be that, whatever might be the date of effect of the termination of employment for the purposes of the Public Service Act 1999, the date of termination for the purposes of s.170CE(1) could not be earlier than the date that the notice of the termination was received by the employee.
[29] It may be noted that the Full Bench decision in Burns v Aboriginal Legal Service of Western Australia (Inc) 16 that was referred to in ATO v Wilson concerned the operation of the 21-day time limit in s.170CE(7), which ran from “the day on which the termination took effect”. The facts of that matter, and the Full Bench’s conclusion concerning the date of effect of the termination of employment, were briefly stated as follows:
“[24] As we have already stated, the facts of this matter are not in dispute. The letter of termination purports to make the termination effective from 14 April 2000. The letter, however, was dated 18 April 2000 and was delivered by courier to the appellant’s home address on 19 April 2000. In our view, a termination of employment does not take effect unless and until it is communicated to the employee whose employment is being terminated. The earliest that such communication could be said to have occurred in this case was the date upon which the letter of termination was received at her home address, i.e. 19 April 2000.”
[30] The operation of the 21-day time limit in s.643(14) of the WR Act, as amended by the Workplace Relations Amendment (Work Choices) Act 2005, was further considered by a Full Bench of the AIRC in Makenja v Baptist Community Services. 17 In that matter, the employee had taken authorised annual leave and had travelled to Tanzania where she fell ill and was unable to return to Australia as planned. Her employer formed the conclusion, after she failed to return to work after her period of annual leave ended and it was unable to contact her, that she had abandoned her employment. It eventually sent her a letter dated 13 July 2006 notifying her that her employment had ceased as at that day. The employee did not return to Australia until 22 August 2006 whereupon she became aware of the dismissal letter. She filed her application for relief from termination of employment on 12 September 2006, 21 days later. The Full Bench determined the matter on the basis that it was appropriate to extend time to file the application. However the Full Bench also stated:
“[18] There is an additional matter which was not raised in argument. Section 643(14) requires an application to be lodged within 21 days of “the day on which the termination took effect.” Normally a termination of employment would not “take effect” before it was communicated to the employee concerned, although that may not always be the case. In this case it does not seem to be in contest that the appellant was not aware of the letter of termination until 22 August 2006. The application for relief was filed within 21 days of that date. In cases in which abandonment of employment is alleged the time at which the termination took effect may only be ascertainable after resolving factual and legal issues. It will be rare for such issues to be resolved fairly without a hearing. But if on one view of the material before the Commission the application was within time, there is a strong case for allowing the application under s.643(14).”
[31] The circumstances in which it might be the case that a termination of employment took effect before it was communicated to the employee were not identified in Makenja.
[32] The general approach taken under the WR Act whereby a dismissal takes effect when it is communicated to the employee, but subject to possible but unidentified exceptions, has been followed in decisions under the FW Act. The most notable of these was the Full Bench decision in WorkPac Pty Ltd v Bambach. 18 In that matter, the employer appealed a conclusion that a particular ex-employee was a person protected from unfair dismissal. One of the grounds of appeal was a contention (not advanced at first instance) that the ex-employee’s application had not been filed within the prescribed 21-day period and no consideration had been given as to whether there were exceptional circumstances justifying an extension of time. This contention was based on the factual circumstance described in the decision as follows:
“[6] On 17 October 2011, Mr Bambach received an Employment Separation Certificate from WorkPac stating that his employment had ceased on 24 September 2011 and that the reason for separation was ‘unsuitability for this type of work’.”
[33] The Full Bench rejected this ground of appeal for reasons which included the following (footnotes omitted):
“[17] In any event we are not persuaded that the Commissioner erred in the manner contended by the appellant. In the circumstances of this case we are not persuaded that the occasion arose for the exercise of the discretion to extend time under s.394(3). This is so because in our view the date of dismissal was 10 October 2011 and not 24 September 2011 as found by the Commissioner. It was common ground at first instance and on appeal that 10 October 2011 was the date that the dismissal of Mr Bambach’s employment took effect. This was the date on which the appellant informed Mr Bambach that there was no work available for him.
[18] We acknowledge that the Employment Separation Certificate identified the date of termination as 24 September 2011. But that fact is not determinative of this issue, for three reasons:
(i) The author of the Employment Separation Certificate was not called and the only witness called by WorkPac (Ms Jessica Patricia Deen) had no knowledge of the procedure involved in the preparation of these documents.

(ii) WorkPac’s Form 3 response to the application is also relevant, it states:
“The Applicant requested that WorkPac complete a Separation Certificate in [sic] to facilitate his access to unemployment benefits. WorkPac complied with this request, but made it clear that they would continue in efforts of securing him work…
Upon the request of the Applicant, WorkPac issued a Separation Certificate. This was done solely to assist the Applicant in securing unemployment benefits.
The reference on the Separation Certificate should not be considered determinative of any position taken by WorkPac with respect to the Applicant.”
We note that the last observation was made in relation to the notation on the Certificate that the reason for termination was ‘unsuitability for this type of work.’ But nevertheless the observation illustrates WorkPac’s disavowal of information contained in the document.
(iii) The Employment Separation Certificate was signed on behalf of WorkPac on 13 October 2011 and was received by Mr Bambach on 17 October 2011.
[19] In relation to the last point there is ample authority for the proposition that a termination of employment takes effect when it is communicated to the employee. There may be some exceptions to this general proposition but none are relevant in the context of this matter. On this basis even if the Employment Separation Certificate constituted the instrument which terminated Mr Bambach’s employment it did not take effect until he received it, on 17 October 2011.
[20] Accordingly, on any view of it, the application was filed within the prescribed time.”
[34] A footnote to the second sentence in paragraph [19] in the passage quoted above referred to ATO v Wilson and Makenja v Baptist Community Services to which reference has earlier been made, and to Transport Workers’ Union of Australia v National Dairies Limited 19 (which was quoted in the passage from ATO v Wilson set out above).
[35] We see no reason to depart from the above line of authority insofar as it is consistent with the general principle at common law that a dismissal may not take effect prior to it being communicated to the employee. Neither party submitted otherwise. However two questions remain. The first is whether there are any exceptions to this principle, the existence of which are suggested but not identified in Makenja andWorkPac. The second is whether the mere receipt of a communication (whether a letter, fax or email) is sufficient to constitute the communication of the dismissal to the employee in circumstances where the employee has not read the communication immediately upon receipt.
[36] Having regard to the language, purpose and context of s.394(2)(a), we do not consider in relation to either question that the provision should be interpreted or applied so that the 21-day period to lodge an application for an unfair dismissal remedy could begin to run before an employee who has been dismissed at the initiative of the employer became aware that he or she had been dismissed, or at least had a reasonable opportunity to become aware of this. The combination of the very restricted time period to lodge an application under s.394(2)(a), together with the very high bar of “exceptional circumstances” required to be surmounted in order to obtain an extension of time to lodge an application, clearly demonstrates that it was intended that the timeframe to agitate such an application was to be strictly limited. Indeed s.394(2)(a) of the FW Act as originally enacted provided for a 14-day period only; this was extended to 21 days by the Fair Work Amendment Act 2012. On any view, the period allowed by s.394(2)(a) is extremely short having regard for the need for a dismissed person to take stock of his or her situation, seek advice or information about his or her rights, make a decision to seek a remedy, and complete and lodge an application. In that context it would require express language to justify an interpretation of the provision under which the 21-day time period allowed is further shortened because a dismissal is taken to have had effect before the employee has become aware that it has occurred. Were it otherwise, it would be possible for a dismissal with retrospective effect to be constructed which significantly diminished or even entirely eliminated the time allowed for an employee to lodge an unfair dismissal remedy application.
[37] The object of Pt 3-2 is stated in s.381 as follows:
381 Object of this Part
(1) The object of this Part is:
(a) to establish a framework for dealing with unfair dismissal that balances:
(i) the needs of business (including small business); and
(ii) the needs of employees; and
(b) to establish procedures for dealing with unfair dismissal that:
(i) are quick, flexible and informal; and
(ii) address the needs of employers and employees; and
(c) to provide remedies if a dismissal is found to be unfair, with an emphasis on reinstatement.
(2) The procedures and remedies referred to in paragraphs (1)(b) and (c), and the manner of deciding on and working out such remedies, are intended to ensure that a “fair go all round” is accorded to both the employer and employee concerned.
Note: The expression “fair go all round” was used by Sheldon J in re Loty and Holloway v Australian Workers’ Union [1971] AR (NSW) 95.
[38] The restricted timeframe provided for by s.394(2)(a) is certainly consistent with that part of the object which refers to the procedures for dealing with unfair dismissal being “quick”. It may also be the case that the emphasis on reinstatement as a remedy in s.381(1)(c) is supported by a requirement to initiate proceedings in a short period after dismissal. However it would not be consistent with a system that addresses the needs of employees as well as employers and is intended to ensure that a “fair go all round” is accorded to employees as well as employers that the practical opportunity to lodge an application is diminished or eliminated by treating any dismissal as having retrospective effect.
[39] At least in relation to dismissals on notice, support for the conclusion that s.394(2)(a) is to be read as requiring the communication of a dismissal to the employee for it to take effect is derived from s.117(1), which is part of the National Employment Standards provisions concerning termination of employment and redundancy. It provides (underlining added):
Notice specifying day of termination
(1) An employer must not terminate an employee’s employment unless the employer has given the employee written notice of the day of the termination (which cannot be before the day the notice is given).
Note 1: Section 123 describes situations in which this section does not apply.
Note 2: Sections 28A and 29 of the Acts Interpretation Act 1901 provide how a notice may be given. In particular, the notice may be given to an employee by:
(a) delivering it personally; or
(b) leaving it at the employee’s last known address; or
(c) sending it by pre-paid post to the employee’s last known address.
[40] Section 117(1) prohibits a termination of employment to which it applies taking effect before the day on which notice of the termination is given. Section 123 has the effect of excluding from the operation of s.117(1), among other things, employees dismissed for serious misconduct and casual employees. These exceptions are ones in relation to which the common law does not require a period of notice of termination to be provided. However s.117(1) establishes that a termination of employment cannot occur by way of a retrospective notice.
[41] We therefore do not consider that there is any proper exception to the general proposition established by the authorities under the WR Act and the FW Act that a dismissal cannot take effect for the purposes of those statutes before it is communicated to the employee. There is little support for the existence of any such exception which may be derived from the common law. While it is not inconceivable, as earlier stated, that a contract of employment might expressly provide that it may be terminated by the employer on notice to the employee effective from a time prior to receipt of the notice by the employee, we do not consider for the reasons we have stated that any such contract could be treated as determining the date of effect of a dismissal for the purposes of s.394(2)(a). Termination of employment in accordance with such a provision would be in contravention of s.117(1). Statutory industrial instruments such as modern awards and enterprise agreements could also conceivably allow a date of dismissal which is effectively retrospective (although we are not aware of any which actually do so), but again this could not be treated as determinative of the operation of s.394(2)(a) in a particular case such as to deprive a dismissed employee of the full time period allowed by the provision. In relation to statutory provisions governing public sector employment, we have already noted what was said by the Full Bench in ATO v Wilson about the Public Service Act 1999. We do not consider that such legislation could establish an effectively retrospective date of effect of a dismissal for the purpose of s.394(2)(a) of the FW Act unless that was made clear by express words or by necessary implication. There is no such provision in the Public Service Act as it currently stands.
[42] We likewise consider that the mere delivery of a document to an employee’s usual address notifying the employee of his or her dismissal would not of itself constitute communication of that dismissal, and concomitantly the time at which the dismissal took effect, if the circumstances were that this did not constitute a reasonable opportunity for the employee to actually read the document. That is, we do not consider that s.394(2)(a) requires the strict application of a “postal delivery rule” where the employee has a legitimate explanation for not being able to read the document immediately upon delivery. 20 The circumstances in which this may be the case are undoubtedly manifold, but for example if an employee is on an approved period of annual leave and is holidaying away from home when a dismissal letter is delivered, there is no reason to conclude that the date of dismissal is the date of delivery and not when the employee returns home and first has a reasonable opportunity to read the letter.
[43] In support of this approach, we find persuasive the critical aspects of the analysis of the Supreme Court of the United Kingdom in Gisda Cyf v Barratt. 21 That matter concerned the proper interpretation and application of s.97(1) of the Employment Rights Act 1996 (UK), which among other things establishes a right not to be unfairly dismissed (s.94) and establishes a system under which dismissed employees may complain that a dismissal was unfair and seek an order for reinstatement, re-engagement and/or compensation. Section 111(2)(a) provided that a complaint of unfair dismissal had to be lodged within three months “beginning with the effective date of termination” (with there being a limited capacity to obtain an extension of time under s.111(2)(b)). Section 97(1) relevantly identified the definition of the “effective date of termination” as follows:
(1) … in this Part ‘the effective date of termination’ –
(a) in relation to an employee whose contract of employment is terminated by notice, whether given by his employer or by the employee, means the date on which the notice expires,
(b) in relation to an employee whose contract of employment is terminated without notice, means the date on which the termination takes effect …
[44] The facts of the case were as follows. Ms Barratt, the relevant employee, was suspended by her employer for alleged misconduct on 19 October 2006. The employer conducted a disciplinary hearing on 28 November 2006, and at its conclusion she was informed that she could expect to receive a letter informing her of the outcome on 30 November 2006. On the morning of 30 November 2006 Ms Barratt visited her sister, who had just given birth. On that day a letter arrived at her home, which was from her employer advising that she was summarily dismissed for gross misconduct. It was received by her partner’s son but left unopened because she had left no instructions for it to be opened and read. Ms Barratt did not return home until late on the evening of 3 December 2006. The following morning she inquired whether any mail had arrived, and the letter was produced, whereupon Ms Barratt learned that she was dismissed. She initially pursued her internal review rights, with the result that her complaint of unfair dismissal was not lodged until 2 March 2007. Whether it was within time or not depended on whether her dismissal took effect on 28 November 2006 (when the letter arrived) or on 3 December 2006 (when she opened the letter).
[45] In its unanimous judgment the Court began by saying:
“[1] Determining what is the effective date of the termination of a person’s employment has fundamental implications for any claim for unfair dismissal. This case illustrates the substantial penalty that will be paid by an employee who fails to recognise its significance, for the effective date of the termination of employment is the effective date on which time begins to run on the short period within which an employee must launch his or her claim for unfair dismissal.”
[46] In response to the employer’s argument that s.97(1)(b) was to be interpreted consistent with contractual principles, so that the dismissal took effect when the dismissal letter was delivered to the employee and she had an opportunity to read it, the Court said:
“[29] In examining the question whether Ms Barratt had the opportunity to learn of the contents of the letter, should the focus be on the reasonableness of her behaviour in failing to avail of the chance to discover what it contained, or should it be on the existence of the opportunity to do so? The Employment Judge, the EAT and all the members of the Court of Appeal were unanimous in the view that to include consideration of the behaviour of the respondent in an assessment of whether she had a reasonable opportunity to find out what the letter contained was not an error of law. We agree.
[30] The circumstances of the present case exemplify the need to be mindful of the human dimension in considering what is or is not reasonable to expect of someone facing the prospect of dismissal from employment. To concentrate exclusively on what is practically feasible may compromise the concept of what can realistically be expected…
[32] The genesis of the “reasonable opportunity to discover” test is to be found in the decision of the EAT in Brown v Southall & Knight. In that case it was held that where dismissal is communicated to an employee in a letter, the contract of employment does not terminate until the employee has actually read the letter or has had a reasonable opportunity of reading it. It was not enough to establish that the employer had decided to dismiss a person or had posted a letter saying so. If, however, the employee deliberately did not open the letter or if he went away to avoid reading it, he might well be debarred from saying that notice of his dismissal had not been given to him.

[34] Underlying both decisions (although not expressly articulated in either) is the notion that it would be unfair for time to begin to run against an employee in relation to his or her unfair dismissal complaint until the employee knows – or, at least, has a reasonable chance to find out – that he or she has been dismissed. This is as it should be. Dismissal from employment is a major event in anyone’s life. Decisions that may have a profound effect on one’s future require to be made. It is entirely reasonable that the time (already short) within which one should have the chance to make those decisions should not be further abbreviated by complications surrounding the receipt of the information that one has in fact been dismissed.
[35] These considerations provide the essential rationale for not following the conventional contract law route in the approach to an interpretation of section 97. As Mummery LJ said, it is a statutory construct. It is designed to hold the balance between employer and employee but it does not require – nor should it – that both sides be placed on an equal footing. Employees as a class are in a more vulnerable position than employers. Protection of employees’ rights has been the theme of legislation in this field for many years. The need for the protection and safeguarding of employees’ rights provides the overarching backdrop to the proper construction of section 97.
[36] An essential part of the protection of employees is the requirement that they be informed of any possible breach of their rights. For that reason we emphatically agree with the EAT’s view in McMaster that the doctrine of constructive knowledge has no place in the debate as to whether a dismissal has been communicated. For the short time of three months to begin to run against an employee, he or she must be informed of the event that triggers the start of that period, namely, their dismissal or, at least, he or she must have the chance to find out that that short period has begun. Again, this case exemplifies the need for this. During the three months after Ms Barratt’s dismissal, she pursued an internal appeal; she learned that she was unsuccessful in that appeal; she sought advice in relation to the lodging of a complaint of unfair dismissal; and she presumably required some time to absorb and act upon that advice. Viewed in the abstract, three months might appear to be a substantial period. In reality, however, when momentous decisions have to be taken, it is not an unduly generous time.

[39] The need to segregate intellectually common law principles relating to contract law, even in the field of employment, from statutorily conferred rights is fundamental. The common law recognised certain employment rights, but the right at common law not to be wrongfully dismissed is significantly narrower than the statutory protection against unfair dismissal. The deliberate expansion by Parliament of the protection of employment rights for employees considered to be vulnerable and the significance of the creation of a separate system of rights was recognised by the House of Lords in Johnson v Unisys Ltd [2001] UKHL 13, [2003] 1 AC 518. In that case the employee had succeeded in an unfair dismissal claim but, because of the statutory cap on compensation, sought to bring a claim at common law for breach of an implied term of trust and confidence during the dismissal process. The House of Lords refused to permit the supplanting of the legislative scheme by entertaining a second claim at common law. The leading judgment of Lord Hoffmann recognised the deliberate move by Parliament away from the ordinary law of contract as governing employer/employee contractual relations….”
[47] Of course the above decision is not an Australian one, and important aspects of its reasoning must be approached with at least two significant reservations in mind. First, the unfair dismissal regime in the FW Act is not, unlike the UK statute, founded on an employee right not to be unfairly dismissed, but rather is “intended to ensure that a “fair go all round” is accorded to both the employer and employee concerned” (s.381(2)). Accordingly the weight given in Gisda Cyf to the protection of the employee’s right in interpreting the statute cannot apply to the FW Act. Second, the segregation between the general law concerning employment contracts and the statutory regime emphasised in Gisda Cyf is perhaps less marked in the FW Act. Most of the key provisions of the FW Act have a long antecedent history in Australian industrial law, and many of its concepts have over the course of that history been drawn from the general law of employment. We have already referred to the fact that Pt.3-2 operates with respect to persons who at common law are party to employment relationships recognised as such at law. It is therefore less safe to assume that the parliamentary intention in respect of particular provisions in the FW Act is divorced from common law principles.
[48] Nonetheless the critical point made in Gisda Cyf that the shortness of the period allowed to lodge a claim must inform the way in which the time-limiting provision is interpreted is valid in the context of the FW Act. Indeed the proposition is a fortiori given that time period allowed by the FW Act is much shorter and the circumstances in which an extension of time may be obtained are more constrained. 22 An interpretation of s.394(2)(a) which would have the practical effect of reducing further what is already a very limited opportunity to lodge an unfair dismissal claim would be rejected if another is reasonably available. Our conclusion is that, in respect of a dismissal without notice, s.394(2)(a) is to be interpreted on the basis that the dismissal cannot not take effect for the purposes of Pt.3-2 of the FW Act until an employee knows, or at least has a reasonable opportunity to find out, that he or she has been dismissed. It is in that sense the dismissal is regarded as having been communicated to the employee.
[49] In relation to a dismissal with notice, drawing on the common law principles earlier identified, the dismissal would take effect upon the date of the expiration of the specified period of notice. It is necessary however for that date to be clearly identifiable. This would equally apply to a conditional notice of termination. In the case of a dismissal with a payment in lieu of notice, the dismissal would need to be communicated to the employee in such a way that the employee knows, or at least has a reasonable chance to find out, that he or she has been dismissed. There may also be an additional requirement that the payment in lieu of notice has actually been received by the employee.
[50] In a situation where an employee is informed by email that he or she has been dismissed, the employee can usually be regarded as knowing or having a reasonable opportunity to know of the dismissal when the email is received in the inbox of the employee’s usual email address. We note in this connection that s.14A of the Electronic Transactions Act 1999 (Cth) provides that an email is deemed to have taken place when the email becomes capable of being retrieved by the addressee at an email address designated by the addressee. There may be circumstances in which mere receipt of an email may not constitute a reasonable opportunity to become aware of a dismissal – for example when the employee has not read the email because of an incapacitating illness or is legitimately unable to access their email for other reasons. However a simple refusal to read an email would of course not operate to delay the date of effect of the dismissal.

Ayub v NSW Trains (2016) FWCFB 5500 delivered 30 September 2016 per Hatcher VP, Wells DP and Johns C