Unfair constructive dismissal principles

This extract from a recent unfair dismissal case is a classic summary of the legal principles which determine a constructive dismissal case.

“I now turn to consider whether Mr Singh was dismissed as alleged.

[77] Sections 385(a) and 394 require a dismissal to have occurred as a jurisdictional fact. A

mere allegation that a person has been dismissed will not establish that as fact.23

“Dismissal”

for these purposes (and other purposes of the FW Act) is defined in s 386(1). It provides:

“386 Meaning of dismissed

(1) A person has been dismissed if:

(a) the person’s employment with his or her employer has been terminated on the

employer’s initiative; or

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(b) the person has resigned from his or her employment, but was forced to do so

because of conduct, or a course of conduct, engaged in by his or her employer.”

[78] A full bench of the Commission in Bupa Aged Care Australia Pty Ltd t/a Bupa Aged

Care Mosman v Tavassoli set out the background to s 386:24

“[33] Notwithstanding that it was clearly established, prior to the enactment of the FW

Act, that a “forced” resignation could constitute a termination of employment at the

initiative of the employer, the legislature in s.386(1) chose to define dismissal in a way

that retained the “termination at the initiative of the employer” formulation but

separately provided for forced resignation. This was discussed in the Explanatory

Memorandum for the Fair Work Bill as follows:

“1528. This clause sets out the circumstances in which a person is taken to be

dismissed. A person is dismissed if the person’s employment with his or her

employer was terminated on the employer’s initiative. This is intended to capture

case law relating to the meaning of ‘termination at the initiative of the employer’

(see, e.g., Mohazab v Dick Smith Electronics Pty Ltd (1995) 62 IR 200).

  1. Paragraph 386(1)(b) provides that a person has been dismissed if they

resigned from their employment but were forced to do so because of conduct, or

a course of conduct, engaged in by their employer. Conduct includes both an act

and a failure to act (see the definition in clause 12).

  1. Paragraph 386(1)(b) is intended to reflect the common law concept of

constructive dismissal, and allow for a finding that an employee was dismissed

in the following situations:

  • where the employee is effectively instructed to resign by the employer in

the face of a threatened or impending dismissal; or

  • where the employee quits their job in response to conduct by the

employer which gives them no reasonable choice but to resign.”

[34] It is apparent, as was observed in the decision of the Federal Circuit Court (Whelan

  1. J) in Wilkie v National Storage Operations Pty Ltd, that “The wording of s.386(1)(b) of

the Act appears to reflect in statutory form the test developed by the Full Court of the

then Industrial Relations Court of Australia in Mohazab v Dick Smith Electronics Pty

Ltd (No. 1) and summarised by the Full Bench of the Australian Industrial Relations

Commission in O’Meara v Stanley Works Pty Ltd” (footnotes omitted). The body of

pre-FW Act decisions concerning “forced” resignations, including the decisions to

which we have earlier referred, has been applied to s.386(1)(b): Bruce v Fingal Glen

Pty Ltd (in liq); Ryan v ISS Integrated Facility Services Pty Ltd; Parsons v Pope

Nitschke Pty Ltd ATF Pope Nitschke Unit Trust.” (footnotes omitted)

Termination at the employer’s initiative

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[79] Termination at the initiative of an employer within the meaning of s 386(1)(a) of the

FW Act arises where the action of the employer is the principal contributing factor leading to

the termination of the employment relationship.25

[80] It is not contended and nor do I find that Mr Singh’s employment was terminated on 14

March 2023 effective 10 March 2023 at the employer’s initiative. Leaving aside whether the

employer’s conduct was reasonable, its notification of a roster change did not bring the

employment relationship to an end. Mr Singh was not employed to work a particular or set

roster such that a change to that roster by the employer in and of itself terminated the

employment relationship.

[81] Further, the termination at the employer’s initiative that is said to have occurred on 14

April 2023 is not the subject of this application. It is irrelevant to the consideration of this

matter.

Resignation

[82] Whether an employee has resigned from their employment is a question of fact. It is

well established that, like termination on an employer’s initiative, a resignation must be clear

and unequivocal given the significant consequence of it bringing an employment relationship

to an end.

[83] Did Mr Singh resign on 14 March 2023 effective 10 March 2023?

[84] For the following reasons he did not do so.

[85] Firstly, Mr Singh threatened to resign but did not in fact resign. At its highest, the

evidence establishes that Mr Singh foreshadowed (and in that sense, threatened) to resign if the

employer continued to press its demand that he work the new roster. A threat to end one’s

employment by resignation is different to conduct actually ending that employment. Mr Singh

neither by word nor deed brought his employment to an end. On 14 March 2023 he maintained

his earlier threat (made to Mr Mykytyschyn on 23 February 2023) to resign if the employer did

not back down. He did not carry through with that threat.

[86] Secondly, the evidence clearly establishes that the employment relationship between Mr

Singh and Certis Security continued beyond the meeting of 14 March. It is not in dispute that

that meeting concluded on the basis of Mr Koh’s intimation that the parties would reconvene

in one to two weeks after Mr Singh considered his position further and on Mr Koh’s further

intimation that Mr Singh would not be required to work the new roster during that intervening

period. There is no evidence that Mr Singh said or did anything once the meeting concluded on

this understood basis that brought the employment relationship to an end. The fact that during

the week following Mr Harms spoke to Mr Singh about a further alternative roster in the

Adelaide city centre to try and break the impasse and that Mr Singh did not accept the

suggestion is further evidence that a continuing employment relationship existed.

[87] In summary, there is no evidence that permits a finding to be objectively made that Mr

Singh resigned or notified his resignation on or around 14 March 2023. All of the evidence

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points in the other direction, that Mr Singh was employed between 10 March 2023 and 14

March 2023 and remained so employed in the days immediately thereafter.

[88] Mr Singh’s case is based on an incorrect premise that he was “dismissed” because he

had been removed from a roster that he had worked prior to going on leave.26 Mr Singh conflates

the fact that he was removed from that roster with the proposition that this constituted a

dismissal such that his refusal to work the new roster was a resignation. A requirement that an

employee work a new or different roster that is met with a refusal by the employee to do so is

not a resignation. Mr Singh’s conduct on or around 14 March 2023 was a refusal to work the

new roster because of his circumstances and because performance concerns had not been

plainly put and resolved. There was a standoff been he and his employer but it was not a

resignation.

[89] In reaching this decision I have taken into account Mr Singh’s submission that he “does

not have a thorough grasp of Australian law; as a result, he assumed a verbal resignation” and

that he “didn’t give any official resignation in his life before”.

27 This submission, whilst

relevant, does not take the matter any further. I have observed that a resignation can be written

or oral. However, I have not found that Mr Singh verbally resigned. I have found that, at its

highest, Mr Singh verbally and by text foreshadowed or threatened to resign but not that he in

fact resigned. Just as cultural differences do not obviate the need for an employer to express a

dismissal in clear and unequivocal terms,28 so too with an employee’s resignation.

[90] Mr Singh submitted that Mr Koh texted him on the evening of 17 March indicating that

he (Mr Koh) intended to resign and take responsibility for the situation, and that this is relevant

to the jurisdictional issue.29 I do not agree. Without making any finding as to the meaning of

the text exchanges between the two that evening, and without expressing a view as to whether

such texts are relevant to merit, they do not bear on whether Mr Singh resigned on 14 March

2023.

[91] Mr Singh did not resign from his employment on or around 14 March 2023 effective to

10 March 2023 as alleged.

Forced resignation

[92] Having found that Mr Singh did not resign from his employment the question whether

he was forced to resign does not arise.

[93] There is no utility in considering whether the conduct of the employer was such that it

objectively forced a resignation given that the jurisdictional fact of resignation has not been

established.

Conclusion

[94] I have not found that Mr Singh’s employment was terminated by Certis Security at its

initiative on or about 14 March 2023 within the meaning of s 386(1)(a) of the FW Act.

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[95] I have not found that Mr Singh resigned from his employment on or about 14 March

2023 effective 10 March 2023. Given this, there was not and could not have been a forced

resignation within the meaning of s 386(1)(b).

[96] I have found that Mr Singh was employed by the respondent at the time he made this

unfair dismissal application. He had not resigned nor had he been dismissed.

[97] Accordingly, as Mr Singh was not dismissed as alleged his unfair dismissal application

fails for want of jurisdiction.

[98] There being no jurisdiction, the application must be dismissed.

[99] I make one final observation. Given the above, I have not made any finding as to the

reasonableness of the new roster required of Mr Singh on his return from annual leave nor the

reasonableness of the conduct of the employer or Mr Singh relating thereto except as necessary

to decide this jurisdictional matter. Nor have I made any finding as to whether performance

concerns existed or whether any such concerns had objective merit.

[100] An order giving effect to this decision will be issued in conjunction with its

publication.30″

 

Singh v Certis Security Australia [2023] FWC 1375 delivered 14 June 2023 per Anderson DP