Dismissed worker’s fight to clear reputation muddied by appeal decision

In an unusual set of circumstances, an appeal hearing held by the Fair Work Commission has thrown out a former employee’s grievance despite being initially found to be unfairly dismissed.

The initial decision

The initial decision issued in November 2017 found that the former Business Manager was unfairly dismissed on account of procedural error; however the Commission found the employer had a valid reason to dismiss which diluted the final compensation awarded to the employee.

The former employee had worked for approximately eight months within two of the employer’s dealerships before the termination occurred. The employer had submitted an objection on the grounds of the former employee resigning, in response the employee stated that he had been constructively dismissed.

The employee was dismissed based on two incidents involving inappropriate comments directed toward a young female employee. The second incident was characterised as being in breach of the employer’s sexual harassment policy despite the employee having received training and signing a document confirming his understanding of the policy.


During the course of the Arbitration hearing it became clear that, despite confusion over whether the termination was made at the employer’s initiative, the employer believed the applicant to have committed serious misconduct. It was claimed that the applicant had proposed a set of terms to the employer so that he may leave his employment under the guise of resignation, however the applicant felt that he was forced to make such a compromise as he was due to be terminated in any event and had to protect his future employment interests and a constructive dismissal occurred.

The Commissioner determined that a letter sent from the employer to the employee was supporting evidence that the decision to terminate was at the employer’s initiative. The letter indicated the employer’s position to terminate employment (even asking the employee to remove personal belongings) before allowing the employee to provide a response to the allegations.

Commission finds in favour of the former employee

The Commission found that a valid reason for termination did exist, finding the former employees evidence to contain ‘issues of credit’ coupled with prior employment history and interactions with work colleagues, the comments deemed to be “serious, hostile, derogatory and sexual harassment, in line with the Respondent’s policy”.

However, in what was described as a ‘significant procedural flaw, the fact that the meeting where the allegations were first put to the employee was also the same meeting where the Business responded with the letter stating that “both incidents are deemed unacceptable and will result in your instant dismissal for Gross Misconduct” meant that the sound method of conducting an investigation. This gave the employee an opportunity to respond and then considering all the information before making a fully communicated decision, was lacking. As a result of the errors in the process and the denying of procedural fairness, the employee was awarded $7459.41.

Plot twist – the winner appeals

In a final (and unusual) twist, it was the successful former employee who decided to appeal the decision. Firstly arguing that the Commissioner displayed bias against him (by way of the hearing location and amending the filing directions) and secondly by arguing the Commissioner made ‘significant errors of fact’. The argument of bias being displayed was quickly dismissed by the Full Bench hearing the appeal, and each basis for claiming significant errors of fact (including arguing that the conduct was not sexual harassment and a miscalculation of the compensation amount) was also dismissed with justification by the Full Bench.

The argument the former employee put forward about the standard of proof adopted in matters involving sexual harassment was wholly rejected by the Full Bench. The employee argued that the Commission was required to consider a more onerous standard upon the employer to prove the harassment. It was pointed out in the judgment that the civil standard of proof (balance of probability) was all that the employer required to prove the sexual harassment claim.

The appeal is unsuccessful

Ultimately the Full Bench determined that it was not in the Public Interest to grant the appeal and quashed the matter from progressing further.