Employers need to exercise caution when presented with a resignation lest it not constitute a real one.
“Was Mr Yang dismissed?
[48] Section 386 of the FW Act relevantly provides as follows:
“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
(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.
… ….” ”
41
[2023] FWC 1325
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[49] Mr Yang, in effect, relies upon s.386(1)(a) of the FW Act. Having put the parties on
notice during the hearing, I have also considered whether there was a resignation, whether any
purported resignation was effective, and whether any resignation was forced. Ultimately, I
would not consider that any valid resignation would have been forced, but this final aspect does
not arise for reasons that are set out below.
[50] Although applied under the predecessor to the FW Act,42 the following approach of the
Full Bench of the Australian Industrial Relations Commission in O’Meara v Stanley Works Pty
Ltd43 in my view remains generally apposite to the consideration of s.386(1) of the FW Act:
“[21] In this Commission the concepts have been addressed on numerous occasions
and by a number of Full Benches. In Pawel v Advanced Precast Pty Ltd (Pawel) a Full
Bench said:
“[13] It is plain that the Full Court in Mohazab considered that an important
feature in the question of whether termination is at the initiative of the employer
is whether the act of an employer results directly or consequentially in the
termination of the employment and that the employment relationship is not
voluntarily left by the employee. However, it is to be noted that the Full Court
described it as an important feature. It plainly cannot be the only feature. An
example will serve to illustrate this point. Suppose an employee wants a pay rise
and makes such a request of his or her employer. If the employer declines and
the employee, feeling dissatisfied resigns, can the resignation be said to be a
termination at the initiative of the employer? We do not think it can and yet it
can be said that the act of the employer i.e. refusing the pay rise, has at least
consequentially resulted in the termination of the employment. This situation
may be contrasted with the position where an employee is told to resign or he or
she will be terminated. We think that all of the circumstances and not only the
act of the employer must be examined. These in our view, will include the
circumstances giving rise to the termination, the seriousness of the issues
involved and the respective conduct of the employer and the employee. In the
instant case the uncontested factual findings are that the applicant had for almost
the whole of his employment performed welding duties; that there was no
objective threat to his health and safety involved in the requirement that he
undertake welding duties so long as it was not on a continuous basis and that the
welding he was required to do was not continuous.”
[22] In the Full Bench decision of ABB Engineering Construction Pty Ltd v Doumit
(ABB Engineering) it was said:
“Often it will only be a narrow line that distinguishes conduct that leaves an
employee no real choice but to resign employment, from conduct that cannot be
held to cause a resultant resignation to be a termination at the initiative of the
employer. But narrow though it be, it is important that that line be closely drawn
and rigorously observed. Otherwise, the remedy against unfair termination of
employment at the initiative of the employer may be too readily invoked in
circumstances where it is the discretion of a resigning employee, rather than that
[2023] FWC 1325
10
of the employer, that gives rise to the termination. The remedies provided in the
Act are directed to the provision of remedies against unlawful termination of
employment. Where it is the immediate action of the employee that causes the
employment relationship to cease, it is necessary to ensure that the employer’s
conduct, said to have been the principal contributing factor in the resultant
termination of employment, is weighed objectively. The employer’s conduct
may be shown to be a sufficiently operative factor in the resignation for it to be
tantamount to a reason for dismissal. In such circumstances, a resignation may
fairly readily be conceived to be a termination at the initiative of the employer.
The validity of any associated reason for the termination by resignation is tested.
Where the conduct of the employer is ambiguous, and the bearing it has on the
decision to resign is based largely on the perceptions and subjective response of
the employee made unilaterally, considerable caution should be exercised in
treating the resignation as other than voluntary.”
[23] In our view the full statement of reasons in Mohazab which we have set out
together with the further explanation by Moore J in Rheinberger and the decisions of
Full Benches of this Commission in Pawel and ABB Engineering require that there to
be some action on the part of the employer which is either intended to bring the
employment to an end or has the probable result of bringing the employment
relationship to an end. It is not simply a question of whether “the act of the employer
[resulted] directly or consequentially in the termination of the employment.” Decisions
which adopt the shorter formulation of the reasons for decision should be treated with
some caution as they may not give full weight to the decision in Mohazab. In
determining whether a termination was at the initiative of the employer an objective
analysis of the employer’s conduct is required to determine whether it was of such a
nature that resignation was the probable result or that the appellant had no effective or
real choice but to resign.” (footnotes omitted)
[51] A more recent Full Bench reinforced the relevance of the above approach in Bupa Aged
Care Australia Pty Ltd t/a Bupa Aged Care Mosman v Tavassoli44 in the following terms:
“[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).
- 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
[2023] FWC 1325
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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).
- 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 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)
[52] An employer is generally able to treat a clear and unambiguous resignation as a
resignation. However, where a resignation is given in the heat of the moment or under extreme
pressure, special circumstances may arise. That is, in some circumstances it may be
unreasonable to assume a resignation and accept it immediately. Further, the employer may
have a duty to confirm the intention to resign if, during that time, they are put on notice that the
resignation was not intended.45
[53] Accordingly, the general principles to be applied in this case are well settled. Stated
succinctly, they include:
- The question as to whether there was a dismissal within the meaning of the FW Act
is a jurisdictional fact that must be established by the Applicant;
- A termination at the initiative of the employer involves the conduct (or course of
conduct) engaged in by the employer as the principal constituting factor leading to
the termination. There must be a sufficient causal connection between the conduct
and the resignation such that it “forced” the resignation;
- The employer must have engaged in some conduct that intended to bring the
employment relationship to an end or had that probable result;
- Conduct includes an omission;
[2023] FWC 1325
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- Resignations that are clear and unambiguous may be treated on face value unless
special circumstances are present which warrant the employer confirming the
intention of the employee;
- Considerable caution should be exercised in treating a resignation as other than
voluntary (forced) where the conduct of the employer is ambiguous and it is
necessary to determine whether the employer’s conduct was of such a nature that
resignation was the probable result such that the employee had no effective or real
choice but to resign; and
- In determining the question of whether the termination was at the initiative of the
employer, an objective analysis of the parties’ conduct is required.
[54] I have found that during one of the discussions between the Applicant and Mr Wang,
the Applicant did advise to the effect that he intended to quit his job. This was stated during a
highly emotional discussion, and it could not be said that an actual resignation was provided.
In any event, given the context, I do not consider that it was reasonable for the Respondent to
treat this as a resignation and seek later in the day to rely upon it. The actions of the Applicant
in seeking to resolve his sense of unfairness with the General Manager and later again with
Mr Wang, and his return to the workplace to do so, should have created uncertainty about
whether any resignation was intended. These are the kind of exceptional circumstances46
referred to earlier. In that context, the Respondent made no further inquiries to determine
whether the Applicant’s purported resignation was really intended. Further, given the conduct
of both parties on the day in question, at the time when it was purportedly accepted by SAL, I
do not consider a reasonable period of time had lapsed, after the Applicant advised or implied
to the Respondent that he intended to quit his job, for an objective understanding about that
intention to be reached.
[55] Mr Wang, on behalf of the Respondent and later confirmed by Mr Rong, in accepting
the purported resignation, actually brought the employment to an end at the employer’s
initiative.
[56] This was a dismissal within the meaning of the FW Act. There is jurisdiction to deal
with the merit of this application.”
Extract from Yang v SAL HR Services Pty Ltd [2023] FWC 1325 delivered 4 July 2023 per Hampton DP