When is a resignation a dismissal? When is a resignation a dismissal?

When is a resignation a dismissal?

27 February 2020 | Employer's Liability

In what circumstances can an employee's resignation be treated as a "dismissal" under the Fair Work Act? The case of Sathananthan v BT Financial Group.

In Issue

  • Whether an employee’s resignation constituted a constructive dismissal
  • Whether the dismissal was unfair

The Background

The applicant brought a claim in the Fair Work Commission alleging he had been unfairly dismissed by the respondent. The applicant was a Business Development Manager at the time he resigned in April 2019, after serving out a 1-month notice period.

Prior to resigning, the applicant had made a number of complaints to the respondent about his work circumstances during the course of his employment including: (1) an excessive workload where the applicant regularly worked 70 hours or more each week, (2) the inadequate work performance of a support officer with whom he worked, (3) his poor personal relationship with the support office, and (4) that his grievances about the support officer had not been properly dealt with (despite the respondent investigating 2 complaints made by the support officer about the applicant).

The Decision

Was the applicant “dismissed”?  

The Commission accepted that the respondent did not intend to cause the applicant to resign. Nevertheless, the respondent knew about the applicant’s complaints but did not do anything substantial to address them. Given the respondent’s inaction, the Commission considered the applicant had no reasonable option but to resign, hence the applicant had been “constructively dismissed”.  In reaching its conclusion the Commission:

  1. Emphasised the applicant’s excessive workload; and
  2. Considered that the 1 month notice period served by the applicant, after tendering his resignation, did not change the finding as to dismissal.

Was the dismissal unfair?

The Commission was satisfied that there was no valid reason for the applicant’s dismissal. Bearing in mind its findings regarding the “constructive dismissal” issue, the Commission ultimately concluded that the dismissal was harsh, unjust and unreasonable and thus unfair within the meaning of the Fair Work Act 2009 (Cth).

In the circumstances the Commission awarded the applicant $45,990 in compensation for lost income.

Implications for you

This decision contains 2 “takeaway” messages for employers:

  • Beware of constructive dismissals! In particular circumstances a resignation doesn’t stop an employee succeeding in an unfair dismissal claim; and
  • Workplace conflicts and complaints ought be investigated and dealt with in a timely and effective manner to avoid the potential for criticism or adverse findings by the Commission.

Ravi Sathananthan v BT Financial Group Pty Limited [2019] FWC 5583

Author

Adrian Lewis

Adrian Lewis

Senior Associate