The company entering liquidation could not identify what property was allegedly stolen
The Fair Work Commission (FWC) recently dealt with an unfair dismissal application from a manager who argued he was summarily dismissed for alleged theft of intellectual and real property just days before his employer entered liquidation.
The worker had been employed for over 12 years when he was told in May 2025 that his employment would cease owing to the company being liquidated.
However, after collecting equipment he owned from the premises, he received an email alleging theft and summarily dismissing him.
The worker argued he had only collected his own property and was not given any opportunity to respond to the theft allegations before dismissal.
The employer, now represented by a liquidator, was unable to identify what property was allegedly stolen.
The worker raised concerns that the characterisation of his dismissal as a summary dismissal for serious misconduct would adversely impact his eligibility for the Fair Entitlements Guarantee scheme.
The case required the FWC to examine whether there was a valid reason for the dismissal based on alleged theft, and whether proper procedures were followed before the worker was summarily dismissed.
Employment ended during liquidation process
The worker commenced employment in November 2012 and had been employed for over 12 years at the time of dismissal.
He was engaged as a full-time manager and was paid $1,222.84 gross per week. Some of the equipment used by the worker to perform his role was owned by him personally.
On 11 May 2025, the worker was advised that his employment would cease on 20 May 2025 owing to the employer being liquidated. A director suggested that the worker was not required to attend work during that period.
The worker advised that he would collect equipment at the employer's premises that was owned by him, and collected his property on 12 May 2025.
On 13 May 2025, the worker received an email that advised that he was summarily dismissed as a result of his theft of intellectual and real property owned by the employer.
The notice did not identify what intellectual property or items were allegedly stolen. The worker had not been advised of the allegations prior to his dismissal and did not have any opportunity to respond. The worker was not paid notice or any severance payments.
On 3 June 2025, the worker filed his unfair dismissal application. On the same day, pursuant to an order of the Federal Court of Australia, a liquidator was appointed for the employer.
The liquidator had no involvement with the employer prior to 3 June 2025. The FWC noted that, as the Commission is not a court, the appointment of a liquidator is no barrier to the unfair dismissal application being determined.
No evidence supported the theft allegation
The FWC examined whether there was a valid reason for the dismissal.
The FWC stated: "There is no evidence that [the worker] removed property (real or intellectual) that was not owned by him. There is no evidence to support the contention that [the worker] engaged in serious misconduct. This is no evidence on which a valid reason for a dismissal could be properly founded."
The employer was unable to identify the property, both real and intellectual, alleged to have been stolen. The worker denied removing property that was not owned by him.
The FWC found the worker was not notified of the reason for his dismissal prior to it taking effect. The FWC stated: "The Applicant was not provided with an opportunity to respond."
The worker was summarily dismissed without any prior discussion or opportunity to address the allegations. The FWC noted: "As there was no discussion, there was no opportunity for [the worker] to request a support person to be present."
The employer appeared to have been a small business employer with no evidence regarding the presence of dedicated HR support.
The termination was not based on unsatisfactory work performance. The liquidator advised that the employer had ceased trading and its liabilities exceeded its assets.
Dismissal found harsh, unjust and unreasonable
The FWC considered all factors under section 387 of the Fair Work Act. The Commissioner stated:
"Having considered each of the factors detailed in s.387 of the Act, I have concluded that the termination of [the worker's] employment was harsh, unjust and/or unreasonable."
The FWC noted that the characterisation of the dismissal would potentially adversely impact the worker's eligibility for the Fair Entitlements Guarantee (FEG) scheme.
The FWC was satisfied that reinstatement was not appropriate as the employer was no longer trading.
The Commissioner stated that "my finding that [the worker] did not commit serious misconduct and that there was no valid reason for the dismissal entitles [the worker] to receive notice and severance entitlements under the National Employment Standards either from [the employer] or via the FEG scheme."
The FWC found it reasonable to assume that but for the dismissal, the worker would have remained in employment until 20 May 2025 as originally advised.
The Commissioner stated: "In the circumstances, I believe it is reasonable to assess compensation in this matter on the basis that [the worker] would have continued to be employed for a further week and be entitled to notice."
One week's compensation awarded
The FWC found there was no misconduct, therefore, no discount arose as a result of any misconduct by the worker.
In accordance with section 392(4) of the Fair Work Act, the FWC made no allowance for any shock, distress or humiliation that may have been caused by the dismissal.
The Commissioner stated: "I believe that the compensation detailed below is appropriate, having regard to all of the circumstances of this matter and the considerations specified by the Act."
The FWC awarded compensation in the amount of $1,222.84, equivalent to one week's pay.
The employer did not seek any additional time to pay this amount, so the FWC allowed a period of 14 days for payment.
The decision confirmed that the finding of unfair dismissal entitled the worker to receive notice and severance entitlements under the National Employment Standards either from the employer or via the FEG scheme.
The case confirmed that employers must have evidence to support allegations of serious misconduct before summarily dismissing an employee, and must provide the employee with an opportunity to respond to such allegations.
The absence of any evidence to substantiate the theft allegation, combined with the failure to provide procedural fairness, resulted in a finding of harsh, unjust and unreasonable dismissal.
