A Federal Court judge has rejected the notion that employment contracts in Australia attended by an implied term that employers are obliged to act in good faith when terminating the employment of an employee.
“226 The contract of employment arises in a field which, it is trite to say, is highly regulated. While the FW Act is not a code in the field of industrial and employment law, it provides employees with significant rights around terms of employment, workplace relations, and general protections against unfair dismissal and the kind of adverse actions dealt with above. It seems to me that a separate requirement that the employer act in good faith in relation to termination of employment is unlikely to be “necessary” given the protections around employment, and so would not be implied into Mr Gavin’s contract. That is because this is an area where, naturally, the interests of Svitzer and Mr Gavin diverge. He is already protected from retaliatory adverse actions and unfair dismissal; it is difficult to see why it would be naturally or necessarily implied into the contract that an overlay of good faith were required as well.”
Gavin v Svitzer Australia Pty Ltd [2025] FCA 1623 per NEEDHAM J delivered per 18 December 2025