Reducing an employee’s hours of work; a dismissal?

The vexed issue of whether a unilateral reduction in the number of hours available for an employee to work by an employer is on show in the difference between the following two cases of the Fair Work Commission

In the first, the Commission decided that the employer’s actions in the first meant that the employee’s resignation constituted a constructive dismissal

“Ms Hogan also relied on the decision in Urand v Beaconsfield Children’s Hub [2014] FWA 2024:

‘ What is clear, is that even on the employer’s own version of events, the employer had reduced the shifts of Ms Urand from four to two shifts for next week and that, as conceded by the employer, there was a possibility only, no guarantee, that there would be more shifts than two a week. This is a substantial reduction in shifts and a substantial reduction in pay… Even on the employer’s own version of events, Ms Urand makes it quite clear “that she cannot survive on two shifts and that she would have to give notice”. That is a statement by Ms Urand at the meeting that she is being forced to resign……

On both versions of events it cannot be said that Ms Urand left her employment of her own volition. Rather, she was forced to resign because of a very substantial reduction of hours and she made that plain at the time. The extent of the reduction of the hours and the circumstances of the reduction led her to tender her resignation… In my view, there was a constructive dismissal within s.386 of the Act and Ms Urand’s employment was terminated.’

See Urand v Beaconsfield Children’s Hub [2014] FWA 2024

However in the following case , the second, the Commission decided that the employee’s response to the temporary reduction in hours was irrational and unreasonable and therefore the employee could not have the resignation regarded as a dismissal and could not accordingly prosecute a claim for unfair dismissal.

“Relevant to the test in O’Meara, and having regard to the Full Bench authority in Fingal Glen28 at [21], I do not accept that Ms Hogan had no effective or real choice but to resign because of conduct or a course of conduct engaged in by Mr Samios on behalf of TB Hotels.

Ms Hogan had available to her avenues to make inquiries of her employer as to why she had been given reduced shifts for the week returning from an illness she had been experiencing for at least three weeks. She did not take up the opportunity to discuss the reduced shifts with Mr Samios, or await Mr McFarland’s return call. She attempted to call Mr McFarland only once, and did not leave a voice message detailing any of her concerns.

I do not consider that Mr Samios engaged in conduct, or a course of conduct that would contribute to Ms Hogan reasonably considering she was forced to resign her employment. I am satisfied that Mr Samios was genuinely trying to ease Ms Hogan back into the workplace after a reasonable period of time away from work. Of course, a telephone call to Ms Hogan informing her of the transition for one week only would have assisted, but I do not consider the failure by Mr Samios to inform Ms Hogan could be said to constitute a dismissal at the employer’s initiative, or give rise to a constructive dismissal.”

See Hogan v TB Hotels Pty Ltd T/A The Jubilee Hotel (2017) FWC 4662 delivered 28 September 2017 per Hunt C