When does a discussion about company finances become a termination notice?
The Fair Work Commission (FWC) recently dealt with a case about whether a project manager's departure from his employment constituted a dismissal under the Fair Work Act 2009. The worker claimed he was told during a company meeting that it would be his last day of work.
The employer, a Melbourne-based construction company, maintained that no dismissal occurred. Instead, they said the worker had mentioned having a job interview lined up and asked permission to approach clients for work opportunities.
The case hinged on differing accounts of what was said during a Facebook Messenger meeting on 2 July 2024, where the company discussed its financial difficulties with key staff members.
The project manager was employed from November 2022 until July 2024. By July 2024, the company was experiencing serious financial problems - with cash flow below $10,000 and unable to process new invoices due to unpaid client bills.
On 2 July 2024, a meeting was held via Facebook Messenger with five attendees: the project manager, the company director, the director's wife, his business partner, and an estimator. During this meeting, the company's trading difficulties were discussed.
The project manager testified to the Commission: "We were informed that today, being the date of the call, was the last day of work. I confirmed do you need me for any additional days. [The business partner] confirmed no. I was given instructions for what to do for the remainder of the day, which was largely informing clients that I was no longer working with the company."
According to the FWC, under Section 386 of the Fair Work Act 2009, a dismissal occurs in two circumstances: when employment is terminated at the employer's initiative, or when an employee resigns but was forced to do so because of the employer's conduct.
The company director gave a different account of the meeting: "I was basically going over our finances for the month, or for the fortnight. I knew that we weren't going to make the payroll, and then I told everyone that this isn't good, we need to find other ways to keep it rolling, and that's when we came up with COD, cash on delivery."
In Facebook Messenger exchanges following the meeting, the project manager wrote that he was "wrapping up my position here today."
Two weeks later, a dispute arose when his separation certificate listed his departure as voluntary.
The Commission found that neither party used formal language about termination during the meeting.
As the decision noted: "At one level such is understandable: the meeting on 2 July discussed catastrophic news not only for the business, but for the personal future of each person attending."
The Commission explained the burden of proof: "A finding that a person has been dismissed requires a positive finding about one or more of the elements within s.386 with the onus being on [the worker] to establish their case on the subject."
Ultimately, the Commission concluded: "I cannot be satisfied from these matters that [the worker] has discharged his onus as [a worker] to prove he has been dismissed, to be entitled to commence an application for unfair dismissal remedy."
The unfair dismissal application was dismissed.
