Settlement agreements for unfair dismissal cases

An in-principle settlement agreement of an unfair dismissal case will not be regarded as binding upon the parties until it is rendered unconditional.

“We would also note that the Respondent has quite firmly, and contrary to the usual practice, demanded that the unfair dismissal matter be settled by way of consent orders. The usual practice is that when such matters are settled, they are done so by way of a notice of discontinuance. The fact that the Respondent continued to push so vigorously for a term to be included in the settlement deed that the matter be discontinued by consent orders rather than by a notice of discontinuance demonstrates that there was still some doubt as to whether the matter had been settled. If the Respondent was so sure that an agreement had been reached, it could have simply paid the money to the Appellant and considered the matter settled. It has not done so. The extensive legal costs billed to the Respondent by Maddocks after the matter had allegedly settled on 13 November 2019 indicates that the matter was far from settled. Those entries are indicative that there were still matters to be sorted between Maddocks and its client and the respective parties in relation to any settlement.

[65] Furthermore, we note that in an earlier decision, Tucker v State of Victoria (State Revenue Office) 22 the Deputy President made the following observation at paragraph [16]:

“At the Mention both parties agreed that the Application, while the subject of an in-principle agreement, had not been finally resolved. Accordingly, it appears uncontested that a binding settlement agreement has not been reached and there is therefore still a matter before the Commission.”

[66] The above finding was made in May of 2020, and the Decision, published a few months later in September of the same year suddenly concludes that a settlement agreement indeed had been reached. The Deputy President made note of this in paragraph [102] of the Decision:

“The decision in the Set Aside Application was handed down on 18 May 2020. On the basis of the material before the Commission at that time, the decision found, as a preliminary matter, that no final binding settlement agreement had been reached between the parties. In light of all the material now before the Commission, that conclusion appears to have been premature and in error.”

[67] It is curious that, after making the observation that the parties had not finally resolved the matter, the Deputy President continued with the prosecution of the unfair dismissal application only to then form the view that the matter had been settled with finality. It is not entirely clear what fresh evidence was produced that caused such a drastic change in the Deputy President’s findings as to whether a binding settlement agreement had been reached. So far as we can tell, the only fresh evidence put before the Deputy President was the oral evidence of Ms Ford and Ms Gallaher. Ms Gallaher’s evidence does not go towards whether an agreement was reached on 13 November 2019. In relation to Ms Ford’s evidence, we have already indicated the problems with that evidence.

[68] The Deputy President has committed a significant error of law in finding that an agreement was reached between the parties on 13 November 2019. Accordingly, she has erred in finding that a binding agreement of the kind described in Masters v Cameron 23 had been made.

[69] We are satisfied that the appeal enlivens the public interest. There is an appealable error, being an error of law, within the Decision. Appellate intervention is both warranted and necessary to correct the error and allow the Appellant’s unfair dismissal claim to proceed.”

Tucker v State of Victoria (State Revenue Office) (2021) FWCFB 6004 delivered 15 September 2021 per Catanzariti VP, Cross DP and Yilmaz C