Compensation plus Confirmation of Coexistence of Claims Across Jurisdictions

The ‘Good’ in ‘the Good the Bad the Ugly’ from our 29 July 2025 podcast on Restraint of Trade, Part 1.

An ex-employee received a big win in an unfair dismissal case, after nearly a decade of service with a healthcare and IT recruitment agency based in Sydney.

Background

An employee had not received a pay review in 2 years, and in the current cost of living crisis, asked for what he considered a long overdue review. The Company’s director responded to this request, noting he had little choice despite the Company struggling financially. Eventually an agreement was reached for a $5,000 pay increase.

Unfortunately, this agreed pay rise was not reflected in the next pay slip. The employee enquired about the missing pay increase and was advised by the director that:

his base salary was enough;
they had not agreed on a pay rise; and
asked whether he wanted to continue working there or not.

The employee was then blocked from the company email system, meaning he was unable to respond or perform his duties. Later, the director initiated a chain of text messages which culminated in the employee being terminated, effective immediately. The employee was not paid notice of termination, his annual leave entitlements, long service leave entitlements or his commissions.

The Application

The employee lodged an unfair dismissal claim which was upheld by Deputy President Boyce. DP Boyce determined that he had been dismissed, and that that dismissal was unfair. In determining the amount of compensation DP Boyce considered that the employee would have remained employed for a further six months, if it had not been for the unfair dismissal, resulting in an award for compensation of approximately $45,000 plus super to be paid to the employee.

The employer made an application to reduce this amount due to the business’s financial hardship, and further requested any compensation be payable by instalments over a 12-month period.

DP Boyce noted that the onus falls on employers to bring relevant evidence as to the specific impacts of compensation on the viability of the business when seeking reductions. In this case, the evidence presented was unsatisfactory to establish the specific impacts the proposed compensation would have on the business. As such, no reduction was made.

Further to this, the employer failed to specify in any detail how many instalments he proposed to make, or how much the company could afford to pay in each instalment. As such, DP Boyce ordered that the compensation be paid to the Applicant across a 6-week period. Any failure to meet one of the ordered instalments would result in the entire balance being payable immediately.

Concurrent Applications in Various Jurisdictions

It was acknowledged that the Applicant had made claims in the Federal Circuit and Family Court and the NSW Industrial Relations Commission for his unpaid entitlements relating to annual leave, long service leave, unpaid commissions, and notice of termination. The Fair Work Commission noted that the current award for compensation was for unfair dismissal only, and it was separate to, and did not impact any of the other claims for entitlements payable to him under statute or contract.

Key takeaways

This decision serves to:

Reinforce the need for procedural fairness and protection of employee rights under Australian Law;
Highlight the requirement of clear and reliable evidence in such proceedings; and
Confirm that unfair dismissal rulings can coexist with separate claims for entitlements.

Ilias Kadji v Sigma Resourcing Pty. Ltd. [2025] FWC 1737 (20 June 2025)

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July 11

Heat of the Moment Resignation Questioned, but Ultimately, Dismissal Found not to be Unfair

The ‘Bad’ in ‘the Good, the Bad and the Ugly’ from our 11 July 2025 podcast on Working From Home, is a striking Fair Work Commission (FWC) decision where an organisation has successfully defended the dismissal of a worker who had issued chilling threats to his managers, despite claims the employee had resigned in the “heat of the moment.” The case offers a powerful reminder of the standards surrounding workplace conduct and resignation protocols.

Background

An employee had allegedly engaged in concerning conduct in the workplace, including:

Watching disturbing content and playing inappropriate music at work;
Regularly using female bathrooms despite being asked not to;
Accusing a co-worker of illicit and inappropriate activities;
Operating a forklift then stating he would fail a drug test; and
Stating to co-workers that he had been in prison with another volunteer for the organisation, and that that volunteer had been incarcerated for murder.

The employer scheduled a performance management meeting, in which a formal warning was to be issued. The meeting quickly unravelled, with the employee losing his temper.

The Incident

During the meeting, the employee reportedly became confrontational and threatening, inciting bikie violence and telling his managers that they “better watch their backs” and “there is a bullet with your name on it”. The incident culminated in a heated resignation, where he declared, “I’m done. I’m out of here,” and tossed his keys at management. He then collected his belongings and left.

Later, the employee sent a text message asking when he could return to work. Management confirmed via text message that his resignation had been accepted, and he would not be returning to work. The employee denied resigning and asserted that his employment had been terminated.

An application to the FWC for remedies for unfair dismissal was lodged shortly after. The employer resisted this application with a jurisdictional objection, asserting that the employee was not dismissed, rather he had resigned, and in the alternate, if there was a dismissal it was not unfair as the employment came to an end due to serious misconduct.

The Commission’s Analysis

Commissioner Schneider concluded that it was likely that a resignation did occur at the conclusion of the meeting, however, he acknowledged that the resignation had occurred in a heated moment and suggested that the employer should have provided the employee an opportunity to reconsider his resignation, after a cooling off period. He further noted that while resignations “may usually be taken as they come, in some circumstances, there arises a duty to clarify a resignation.”

After hearing competing evidence on the resignation, Commissioner Schneider noted that if a resignation had not occurred, he would be satisfied that a dismissal at the initiative of the employer had occurred. However, that dismissal was not unfair given the seriousness of the employee’s conduct at the meeting.

As such, the application was dismissed. This case serves as a timely reminder to employers that:

Heat of the moment resignations are not always final; employers should allow time for reflection after emotionally charged exchanges and seek confirmation or clarification after the fact.
Threats alone justify summary dismissal; safety in the workplace is paramount.
Emphasis on the importance of adequate documentation during performance management processes, the production of and reliance on verbal and written warnings, file notes of conversations and plans for a performance review assisted the employer in this case.

Mr Thor Dewar v Pek Care [2025] FWC 1587 (1 July 2025)

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August 19

The Right to Disconnect

The ‘Right to Disconnect’ has been widely publicised but what does it actually mean for employees and employers? What about staff who need to be “on call” outside normal working hours? What happens if an employer fails to respect the right to disconnect?

The introduction of the right to disconnect marks a significant shift in workplace relations, ensuring that employees can maintain a healthy work-life balance by setting boundaries on work-related communications outside of their ordinary hours. As this workplace right takes effect, it is crucial for both employers and employees to understand and respect these new guidelines.

What is the Right to Disconnect?

Starting 26 August 2024, employees working for businesses with more than 15 employees will have the right to disconnect, meaning they can refuse employer or third-party contact outside of their working hours. This right will extend to employees of small businesses (with 15 or fewer employees) beginning 26 August 2025. Under this policy, employees have the right to decline monitoring, reading, or responding to any contact from their employer or a third party outside of their working hours, unless such refusal is deemed unreasonable. This right also applies to any attempted contact made outside of an employee’s working hours.

When Is Refusal Considered Unreasonable?

A key element of this new workplace right is determining whether an employee’s refusal is reasonable.

The new law provides some guidance as to what matters will be taken into account in assessing whether a refusal is reasonable (e.g. the level of disruption to the employee, the employee’s level of responsibility and, importantly, the extent to which the employee is compensated for being available outside of ordinary hours of work) but ultimately it will be important to see how these matters are applied by the Courts to practical scenarios. From 26 August 2024, all awards will be amended to include a ‘right to disconnect’ provision and additional guidance may also be provided in these amendments.

Employers should evaluate whether contacting employees outside of their ordinary hours is necessary and whether it would be considered “reasonable” based on the criteria outlined above. It will also be important to consider whether any amendments to your standard employment agreements or workplace policies are needed to make sure employees are aware of the level of availability that is expected of them under their current remuneration arrangements.

Understanding Business Hours and Reasonable Additional Hours

Another important thing for employers to be clear on is what an employee’s ordinary working hours are. These hours should be clearly outlined in their employment contract or terms, and may of course differ from the business’s operating hours. For example, a hospitality establishment might operate from 10:00 am to 11:30 pm, but an employee’s ordinary hours could fall within this timeframe without covering the entire span. Therefore, when considering an employee’s right to disconnect, remember that this right applies once the employee has completed their ordinary hours, as stipulated in their roster or employment contract.

Maximum weekly hours are part of the National Employment Standards (NES), which apply to all employees covered by the national workplace relations system, regardless of any award, agreement, or contract. Employers must not request or require an employee to work more than the maximum (38 hours for full-time employees) unless the additional hours are reasonable:

When determining whether additional hours are reasonable or unreasonable, employers must consider the following factors:

Any risk to employee health and safety;
The employee’s personal circumstances, including family responsibilities;
The needs of the workplace or enterprise;
Whether the employee is entitled to overtime payments, penalty rates, or other compensation for working additional hours, or whether their level of remuneration reflects an expectation of additional hours;
The amount of notice given by the employer to work the additional hours;
The amount of notice given by the employee regarding their intention to refuse additional hours;
The usual patterns of work in the industry;
The nature of the employee’s role and level of responsibility;
Whether the additional hours align with averaging provisions included in an applicable award or agreement, or an averaging arrangement agreed upon by the employer and an award/agreement-free employee.

This list is not exhaustive, and employers should take into account all relevant factors concerning their employees. If additional work hours are needed, employers should consider the terms of the Award, and any contact with employees should be based on the specific circumstances that necessitate it. In circumstances where additional advice is required.

Who is covered by the new law?

Any employee of a ‘national system employer’, can seek protection under this new right to disconnect. A national systems employer includes all corporations under Australia’s workplace relations laws and encompasses the majority of businesses within Australia.

What to do if there is a dispute

Where a dispute arises between employer and an employee around the right to disconnect, they must firstly attempt to resolve this dispute within the organisation. This is an essential step before either the employer or employee apply to the Fair Work Commission (FWC) for assistance.

The right to disconnect is expressly designated as a protected workplace right under Part 3-1 of the Fair Work Act 2009 (Cth) (the FW Act). Therefore, while the FWC encourages workplaces and employees to work collaboratively to resolve disputes, the FWC also has certain powers to deal with such disputes, for example by making a stop order and/or by holding a conference with the parties to try to resolve the dispute.

In addition to these orders, the FWC has jurisdiction to handle disputes if an application is filed under the General Protections regime. Under this framework, employees who have faced adverse actions, such as dismissal, demotion, or being passed over for promotion, can apply to the FWC for a resolution.

Fair Work Commission Dispute Resolution

The FW Act offers employees both new and existing mechanisms to address disputes over the right to disconnect, including requirements for workplace resolution and the ability to seek intervention from the FWC. In addition to protection and recourse if adverse action is taken against employees for exercising or proposing to exercise their right to disconnect.

New Powers:

In accordance with section 333N FW Act, employees and their employer must attempt to resolve any dispute regarding the right to disconnect at the workplace level. This can involve open dialogue, conferences and forms of mediation. If these efforts are unsuccessful, either party may apply to the FWC to make either:

(a) make an order under section 333P (orders to stop refusing contact or to stop taking certain actions);

(b) otherwise deal with the dispute.

To clarify section 333N (3) (B) regarding the phrase ‘deal with the dispute’, section 333V of the FW Act outlines the powers of the FWC to:

Deal with the dispute as it considers appropriate, including by mediation, conciliation, making a recommendation or expressing an opinion, in accordance with section 595 FW Act; and
If the employee and employer notify the FWC that they agree to the FWC arbitrating the dispute—the FWC may deal with the dispute by arbitration.

The relevance of the new powers exists in situations where adverse action has not been taken by an employer, however, the taking of the right to disconnect is disputed and has not been resolved at a workplace level.

Existing powers

Under section 340 of the Fair Work Act, employers are prohibited from taking adverse action against employees for exercising a workplace right, proposing to exercise a workplace right, or preventing employees from exercising a workplace right.

Adverse action includes situations where an employer, in response to an employee exercising a workplace right, including right to disconnect:

Dismisses the employee; or
injures the employee in his or her employment; or
alters the employee’s position to their detriment; or
discriminates against the employee compared to other employees

Eligible employees and prospective employees may file general protections claim. Remedies for adverse action claims include compensation for non-economic losses and financial damages resulting from the employer’s conduct. The Federal Court has unlimited authority to award damages in these cases.

The right to disconnect is now recognised as a workplace right, but, under the existing powers, it only becomes relevant only when an employer takes adverse action against an employee for exercising it. Beyond providing protection in such cases, the right to disconnect has no further significance. We anticipate that this right will play a significant role in general protections claims for individuals who are ineligible for unfair dismissal claims, such as those earning above the high-income threshold.

By leveraging these powers, the FWC can issue stop orders, implement alternative dispute resolution mechanisms, provide recommendations or opinions, and, if agreed upon, arbitrate disputes concerning the right to disconnect.

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April 21

Being a Small Business is no Excuse

Ignorance is bliss. However, when it comes to the law this is not so. Just because someone does not know the law does not discharge them of their liability for any breaches. This is so even for small business employers. Though small businesses are less likely to have the funds to employ or retain dedicated employment law specialists they are still required to fulfil their employment law obligations.

Two recent unfair dismissal cases in the Fair Work Commission (the FWC) provide a warning to small business employers that ignorance is no excuse. In both cases the employers did not comply with the Small Business Fair Dismissal Code.

Mr Troy Currie v The Trustee for B & S Hambleton Trust T/A Perfect Coat Painting [2019] FWC 7462, concerned the dismissal of Mr Currie, a second-year apprentice painter for Perfect Coat Painting. Mr Currie agreed to the employer’s request to receive a flat rate of pay, meaning he received no overtime or penalty rates. Mr Currie was dismissed by text message after not attending work on a Sunday after working the Monday to Saturday before. Mr Currie’s request not to work on the Sunday was denied. Perfect Coat Painting required all employees to work in order to meet the deadline.

Commissioner Hunt held that Mr Currie had been dismissed unfairly. Commissioner Hunt held that it was unreasonable for Perfect Coat Painting to require Mr Currie to work the Sunday after Mr Currie had worked the Monday to Saturday before and would not be paid penalty rates. Commissioner Hunt stated that it was ‘inconceivable’ that in 2019 an employer, even a small business employer, did not know they were required to pay penalty rates to employees who worked weekends in addition to working all week. The amount of compensation payable to Mr Currie is to be determined at a further decision.

Gail Ayton v You Come Pty Ltd t/a Foodworks Ashmont [2019] FWC 6585, concerned the dismissal of Ms Gail Ayton, a casual shop assistant employed for over 20 years, though under different ownership. Ms Ayton was also dismissed by text message. Mr Wang, owner of You Come Pty Ltd, submitted that Ms Ayton was dismissed because her register was short on multiple occasions and she did not notify him when she was absent from work. Ms Ayton submitted that Mr Wang wanted to fire her because she was not Chinese. Due to the lack of evidence Deputy President Sams conducted his own investigation which found job advertisements on Chinese Australian job forums stating, ‘Asian lady preferred’, ‘Asian staff preferred’ and ‘prefer oversea people’.

Deputy President Sams found that Ms Ayton was unfairly dismissed. Deputy President Sams held that Ms Ayton’s non-attendance on the day she was dismissed and the minor cash shortages did not amount to serious misconduct, Ms Ayton was not informed of any risk to her employment and Ms Ayton was not dismissed because of conduct or performance. The job advertisements supported the view that Ms Ayton was dismissed because she was not Asian. Deputy President Sams stated that being a small business with no HR expertise did not justify Mr Wang terminating Ms Ayton in a ‘disgraceful and grossly unfair’ way.

In the decision for remedy, Gail Ayton v You Come Pty Ltd t/a Foodworks [2019] FWC 7029, You Come Pty Ltd was ordered to pay Ms Ayton six months wages minus the amount she had earned in her new position, amounting to $11,803.01 less tax. The matter has been referred for consideration of whether You Come Pty Ltd breached anti-discrimination laws.

Take Home

Ignorance of the law is not bliss. Though the FWC takes into consideration the size of a business and its lack of expert HR support, the FWC does not accept ignorance of the law as an excuse or justification for failing to comply with the law. Any breaches can be quite costly for a small business. Small business employers should learn about their obligations to employees under employment law.

It should be noted that in both cases the employees were dismissed via text message. Employers are strongly advised against this method of communicating dismissal. To learn more about the pitfalls of dismissing an employee via text message, please see the article by my colleague Brian Powles.

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December 6

Podcast | Legal Issues Arising from Christmas Parties

Published 6 December 2019

As we rapidly approach the silly season, this episode of the podcast covers some important issues for employers, and employees, when organising and attending your upcoming end of year parties.

You can listen to the podcast below, or by clicking the links to subscribe on your preferred streaming service:

Spotify: https://spoti.fi/2YiRq5K

Google Podcasts: http://bit.ly/2LFbjxQ

Pocket Casts: https://pca.st/c2V2

Breaker: http://bit.ly/32PIkgk

Radio Public: http://bit.ly/2K1rZwq

The content of this podcast is general in nature and provides a summary of the issues covered. It is not intended to be, nor should it be relied upon, as legal or professional advice for specific employment situations.

Working Knowledge recommends that specialist legal advice should be sought about specific legal issues.

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October 15