She proposed the deal, accepted the payout, then told the Commission she was pushed out
A worker who negotiated her exit package from a government department couldn't later claim she was sacked, the Fair Work Commission ruled.
In a decision issued on August 21, 2026, the Commission dismissed a general protections application brought by a senior executive, finding she had not been dismissed at all. The case turned on a distinction HR teams deal with constantly: the difference between resigning, agreeing to leave, and being terminated by your employer. Only the last of those can support a general protections claim - the kind that lets a worker argue they were pushed out for an unlawful reason.
The worker had been with the Department of Families, Fairness and Housing, a Victorian government department, since 2015. She was a senior executive on a five-year contract that still had years to run. In March 2025 she went on personal leave and never returned, after raising allegations that she had been bullied by two colleagues. According to the decision, the department assessed those allegations but decided they did not need further investigation, and a WorkCover claim she lodged was later rejected. The Commission did not rule on whether any bullying occurred - that was never the question before it.
By October 2025, it was the worker who first raised the idea of a negotiated separation. Over the following weeks the two sides exchanged offers. The department proposed a Targeted Separation Package, plus a payment covering a redeployment period, and her lawyers accepted it, subject to a handful of conditions. One was agreed wording for staff saying she had “decided to resign.”
The final day of negotiations involved some last-minute back-and-forth. The department wanted a deed of release and asked her to formally resign; her lawyers declined both. Without a deed, the department said, it was “not prepared to terminate employment at our initiative.” The parties eventually agreed that her employment would simply end at 5:30pm on October 24, 2025. She was paid $163,417.95 gross.
The day after the payment came through, she lodged a claim arguing she had been dismissed.
The Commission dismissed the application. It found the exit was a mutually agreed termination, made voluntarily by both sides, rather than something the employer set in motion. The worker had raised the separation, accepted the offer and even proposed the finishing date, which made her acceptance the “principal contributing factor” behind the end of her employment. There was no evidence, the Commission noted, that the department would have ended her employment if she had turned the offer down.
The size of the payout supported that conclusion. It was well above the roughly $75,000 the department would have owed had it simply ended the contract with notice. She had negotiated a larger sum, not been retrenched against her will.
Her backup argument also failed. She had contended that a “right of return” to a non-executive role, under Victoria's Public Administration Act, was triggered when her executive contract ended and then wiped out by the payout. The Commission held that right never arose, because the exit was agreed rather than employer-driven. On that basis, the general protections regime did not apply to her termination, and the Commission had no power to hear the claim.
For HR, the lessons are practical. Agreeing to describe a departure as a “resignation” in a staff announcement does not make it one in law - but it can weaken a later argument that the worker was forced out. And an exit that an employee proposes, negotiates and signs off on is hard to recast as an employer-initiated dismissal, however the final announcement is worded.
The application was dismissed.
