Unfair dismissal and settlement agreements

It is not uncommon for parties to agree to settle an unfair dismissal case but subsequently cannot agree about what was agreed  and may seek to walk away from a settlement. In those circumstances it is often necessary for the Fair Work Commission to rule on whether a binding settlement was reached. These passages are an example of that.

“Consideration

[16] Whether a binding settlement agreement was reached by the parties is a matter of fact to be determined on the basis of the material before the Commission.

[17] The question to be determined is if an agreement was reached either at the conciliation or the following day when Mr Kvisle put the revised offer to Mr Dixon through the Conciliator who apparently said it was accepted by Mr Dixon or when a written offer was put to Mr Dixon by Reach on 5 January 2022.The conduct of the parties following the time the agreement is said to have been reached is relevant to the determination of whether an agreement, in fact, had been reached.

[18] In this case I am not satisfied that a binding settlement agreement was reached between the parties. I have reached this conclusion for three reasons.

[19] Firstly, within four hours of the written terms of settlement being sent from Mr Kvisle on 5 January 2022 Mr Dixon responded that he did not agree with the terms. His response, as written, was unequivocal:

I don’t agree. with clause four on settlement agreement as i didnt resign from the company i was told to leave and dont come back so can you remove clause four from the agreement as this is the only part i dont agree with so i will wait for your reply

[20] This reply by Mr Dixon supports a conclusion that the terms of settlement, as presented to his, did not reflect what he had agreed to.

[21] Second, in the email of 6 January 2022 from Mr Kvisle to Mr Dixon Mr Kvisle said “I confirm our offer as outlined in the Terms of Settlement I sent you yesterday will stay open for a period of 14 days from today.” This correspondence suggests that what was being put to Mr Dixon in the “terms of settlement” was an “offer” and not a document that purported to reflect an agreement already reached between the parties. Further, that email strongly suggests that the contents of the “terms of settlement” were still subject to negotiations between the parties.

[22] Thirdly, on 10 January 2022 Mr Kvisle sent an email to the Conciliator in which he said:

After discussing the matter further, I can confirm that it is Reach’s position that yes, James agreeing that he resigned is a deal-breaker for us to come to an agreement.

If he is now unwilling to agree to that, then we are unfortunately in a position where the matter can’t be resolved informally.

[23] That is, Reach acknowledged that there was no settlement reached between the parties.

[24] In these circumstances I cannot conclude that there was any agreement reached between the parties as to the settlement of the dispute between them with such terms only to be reduced to writing.

[25] In reaching my conclusion I do not cast doubt on the credibility of either Mr Kvisle or Mr Dixon. Rather it appears that, while the parties were intent and willing to settle the matter, the details of the settlement got “lost in translation”. This is not a criticism of the Conciliator who made all reasonable attempts and provided assistance beyond the conciliation itself to provide assistance to settle the matter. Rather, the circumstances of this matter demonstrate the risk in not bringing parties back together to jointly work through the proposed terms of settlement so that any misunderstanding or miscommunication is identified at the earliest possible time. I would note that the Conciliator made further attempts in January 2022 to resolve the matter but without success.

[26] Given my finding that no settlement agreement was reached either at or after the conciliation on 15 December 2021, whether what was put in writing accurately reflects the terms discussed is a moot point such that I do not need to consider the principals in Masters v Cameron. 1

Conclusion

[27] Being satisfied that an agreement was not reached in conciliation or following conciliation the application for relief from unfair dismissal will be referred for arbitration. The parties should receive correspondence in relation to the application within the next week.”

Dixon v Reach Crane Trucks (2022) FWC 694 delivered  30 March 2022 per Bissett C