By Ross Levin, Partner, Malcolm Davis, Partner, Adam Lunn, Partner and Lisa Anaf, Partner
Most of the time proving that a termination of employment has occurred is a straightforward affair. What happens, however, when an employee claims that they were forced into a resignation? In those circumstances, when can it be said that the termination was actually at the instigation of the employer? And how does this play out in the context of a statutory unfair dismissal claim?
In a recent decision on the Fair Work Commission in Concannon v Portland District Health, an employee who resigned from his employment, after alleging a frustration of his employment contract, failed in his claim that he had been unfairly dismissed.
Section 386 of the Fair Work Act 2009 (Cth) (Fair Work Act) allows the Fair Work Commission to deal with unfair dismissal claims involving ‘constructive dismissal’ or, in the words of the section, an employee being “forced [to resign] because of conduct, or a course of conduct, engaged in by his or her employer.”
The employee claimed that while in his position as the human resources manager of Portland District Health (PDH), he was sidelined from many decisions and treated as a scapegoat for other controversial decisions. The employee claimed that the PDH’s Chief Executive Officer engaged in this activity and sought to undermine him.
It was held that the approach taken by the Chief Executive Officer in intervening in human resources matters was not unusual in other organisations. It was also held that there was ample opportunity for the employee to propose new management structures, and to utilise existing human resources policies, to advance grievances, as a means to alleviate the situation.
The Commission found that the conduct of the Chief Executive Officer, did not force the employee to resign his position, and that the employee had various other means at his disposal to address the matters with which he had issue. As such it was held, that the conduct did not satisfy the definition of dismissal in s 386 of the Fair Work Act.
Despite the fact that the employee was not successful in his complaint in this case, it is important to remember that it is still possible for employers to be subjected to unfair dismissal claims and claims for breach of contract claims revolving around constructive dismissal. Can it be argued that a course of conduct engaged in by an employer left the employee with not alternative but to resign? Has an employer sought to unilaterally change an employee’s term of employment such that it amounts to a termination of the employment?
Should these questions come to mind as an employer dealing with an employee, then the employer should consider obtaining appropriate legal advice, to mitigate the prospect of a claim.