The attached document replaces the document previously issued with the above code on 7 July 2025.

Corrected the Applicant's name on paragraph [46].

[2025] FWC 1945

Fair Work Act 2009

s.365 - Application to deal with contraventions involving dismissal

Application to deal with contraventions involving dismissal

• [1] Mr Brian Folan has made an application to the Fair Work Commission (Commission) under s.365 of the Fair Work Act 2009 (Cth) (FW Act) for the Commission to deal with a dispute arising out of allegations that he has been dismissed from his employment with Freo Group Pty Ltd (Freo) in contravention of Part 3-1 of the FW Act.

• [2] Freo has objected to the application on the ground that Mr Folan was not dismissed from his employment.

• [3] Before dealing with the dispute under s.368, I must be satisfied that Mr Folan was dismissed.

• [4] In summary, I have found that Mr Folan was not dismissed within the meaning of s.365 of the FW Act and I have dismissed the application.

• [5] The matter was initially listed for case management conference on 20 February 2025, then for hearing on 10 April 2025. At the hearing, Mr Folan represented himself and Freo was represented by Mr Patrick McGurk, Human Resources Business Partner. The parties relied upon written material filed in accordance with directions made by the Commission. Both Mr Folan and Mr McGurk gave evidence during the hearing.

• [6] Mr Folan commenced employment as a Health Safety and Environment (HSE) Advisor with Freo on the Goyder Wind Farm Project, Burra, South Australia on 2 September 2024. Freo is engaged in high risk crane operations and provides crane services to clients. Mr Folan lives in Western Australia and attended work on a 'fly in fly out' basis.

• [7] Freo explained that given the nature of high risk crane operations, the use of mandatory drug and alcohol testing is commonplace in the industry and that Freo has a drug and alcohol policy and procedure. On 16 November 2024, Freo Group issued a seven-day notification to all employees working on the Goyder Wind Farm Project of the introduction of a client mandated drug and alcohol testing process, whereby all employees would undertake drug and alcohol testing on their return to work from Rest and Recreation (R & R). Freo said that this related to the high risk nature of the work and was a consequence of recent non-negative testing conducted on a random basis on employees returning from R & R.

• [8] Both Mr Folan and Freo agreed that if an employee initially recorded a non-negative result, the employee would be stood down without pay and required to obtain a confirmatory test with a negative result before being able to return to work.

• [9] On 16 November 2024, Mr Folan left the Burra site on his R & R. On Sunday 24 November 2024, Mr Folan called Ms Alex Austvik, HSE Advisor, and advised that he was concerned that he would test positive for his prescription medication, diazepam, upon his return from R & R and that he would be prevented from returning to work pending the outcome of the confirmatory result, which was likely to take five days.

• [10] On 25 November 2024, Mr Folan sent an email to Freo raising concerns in relation to the new drug and alcohol testing process for employees returning to work from R & R.

• [11] There was a dispute between Mr Folan and Freo about whether Mr Folan had declared he was taking prescribed medication to Freo as required by its drug and alcohol procedure. Mr Folan said that he disclosed that he was taking the medication when he did his initial medical examination when he first joined Freo through a labour hire company and again during his pre-employment medical examination when he became directly engaged by Freo in September 2024. Further, Mr Folan said that it was known in the workplace that he was taking diazepam. Mr Folan said that he believed that he filled out a declaration about taking diazepam as required by the drug and alcohol policy but this was disputed by Freo.

• [12] Freo contended that from Monday 25 November 2024 until 3 December 2024, Mr Folan was in daily contact with Mr Pete Papas, National Health, Safety and Wellbeing Manager, Mr Clint Gibson, Freo Group General Manager Occupational Health, Safety and Environment and Mr Carlo Francis, Freo Group General Manager - Renewables Projects.

• [13] On 3 December 2024, Freo sent a letter to Mr Folan which relevantly stated:

1. He must undertake and provide a negative drug and alcohol test prior to his return.
2. He must provide information on the medications that he was prescribed and provide a copy of the prescriptions certified by a licenced Medical Practitioner.
3. His continued refusal and failure to attend a drug and alcohol test would be deemed as a non-negative result pursuant to Freo's drug and alcohol procedure.
4. He would be paid personal leave and annual leave for his current absences, as the reason he had not returned to site was related to Freo's reasonable and lawful request for him to undertake a drug and alcohol test in alignment with its policy and procedure, and to also declare the medication he was taking by providing a copy of all prescriptions by a licenced Medical Practitioner.
5. He must provide details of the medications that he was taking so Freo is able to manage its duty of care with him on site and the provision of this information is confidential and would be managed as such.
6. All correspondence should be directed only to Mr Francis, and not to other members of the Site Team.

• [14] The letter also requested that Mr Folan attend a meeting on 4 December 2024 and stated that matters contained in the letter were serious and may be deemed as failure to follow company policy, procedure and reasonable lawful requests made by Freo and if substantiated, may result in further investigations and possible disciplinary proceedings.

• [15] Mr Folan advised Freo he was not able to attend the meeting on 4 December 2024, that he was covered by a medical certificate and that he needed to have his union representative at the meeting.

• [16] On 7 December 2024, Mr Folan undertook a drug and alcohol test as required by the letter dated 3 December 2024. The results were provided to Freo and indicated that Mr Folan required further testing. Mr. Folan was then stood down on pay, pending an investigation into his behaviour and conduct over the period since his R & R, including his failure to notify Freo of his usage of prescribed drugs and his delay in taking a drug and alcohol test. On 10 December 2024, Freo issued a letter to Mr Folan asking him to show cause why his employment should not be terminated during the probationary period.

• [17] According to Freo, over the next two days a series of e-mail exchanges and telephone calls took place, and this concluded with general agreement that it would be better for the parties to agree to a mutual separation. Mr McGurk said that Freo was considering terminating Mr Folan's employment during his probation period but decided that it would agree to a mutual separation if Mr Folan signed a Deed of Release. On 12 December 2024, it was agreed that Mr Folan's employment would cease on 12 December 2024 by mutual agreement pursuant to a Deed of Mutual Release (the Deed). The Deed was signed by Mr Folan on 16 December 2024 and by Freo on or about 18 December 2024.

• [18] Mr Folan said that he had no money and was broke and that is why he signed the Deed. Mr Folan claims his employment was terminated at the initiative of Freo.

• [19] On 12 December 2024, Ms Narelle Aucote, HR Manager sent a message to Mr Folan and his representatives in relation to the return of Mr Folan's property from the site in South Australia to his home in Western Australia. In the first of these emails, dated 12 December 2024, Ms Aucote stated:

Once the deed is signed, we will pack [Mr Folan's personal property] all up and arrange for it to be couriered to his home.

• [20] Mr Folan responded the following day on 13 December 2024 advising that he wanted his housemate Colin to pack up his belongings. The email relevantly provided:

[Colin] is a gem of a human being and of the most trustworthy character. I can't think of anyone better to get it done swiftly, simply and securely.

that allows me the piece of mind to sign the deed now and return in kind.

I will raise a glass (and double drop the Valium) to you all for seeing this out in an admirable and professional fashion.

• [21] Later that day, Ms Aucote sent a reply which relevantly provided:

We will have missed payroll for today, however I will do my best to get the payment actioned as soon as I have the signed deed.

• [22] The same day Mr Folan sent a further email reiterating his request that Colin pack his belongings and relevantly stating:

I'm grateful for your intention to have me financially assisted as soon as possible but I will survive until next week without the money, to then be safe in the knowledge that everything over there has been conducted in alignment with company and legal standards so this deed can signed sealed and delivered.

• [23] Mr Folan signed the Deed and sent it to Freo by email on 16 December 2024. The Deed provided that the settlement monies, which comprised leave, stand down payment, payment in lieu of notice and an ex gratia payment would be paid within seven days of the parties signing the Deed. The Deed required Mr Folan to acknowledge that he had entered into the Deed voluntarily and without any duress from any party and that he was aware of and understood the consequences of entering into the deed, including the consequences of providing the release and indemnity.

• [24] On 18 December 2024, Mr Folan sent an email to Freo which relevantly provided:

Can I please have confirmation that the money has begun processing?

I will drop the company laptop to the main office today in person to make sure there's no outstanding issues to stop payment.

I have been out of work a month now and the debts are accumulating. I'm paying $600 a week rent and no income. I am the only person who has suffered and whose life has been impacted quite heavily.

• [25] Mr McGurk gave evidence that Mr Folan was earning an annual salary of $150,000 and was paid:

• $7,274 (in respect of salary) on 10 November 2024
• $6,249 (in respect of salary) on 24 November 2024
• $1,153 (in respect of leave) on 8 December 2024
• $12,618 (in respect of outstanding salary and statutory entitlements) on 22 December 2024

• [26] Mr McGurk confirmed that Freo was required to pay Mr Folan in respect of the period that he was stood down but did not pay this amount until 22 December 2024.

• [27] On 23 December 2024, Mr Folan sent an email to Freo as he had not yet received his personal belongings. Mr Folan then sent a further email to Freo on 24 December 2024 advising that he had not been provided with a reference. Emails provided by Mr Folan show that he continued to experience delays in receiving his personal belongings until early January 2025.

• [28] The application has been brought under s.365 of the FW Act which provides:

365 Application for the FWC to deal with a dismissal dispute

(b) the person, or an industrial association that is entitled to represent the industrial interests of the person, alleges that the person was dismissed in contravention of this Part;

the person, or the industrial association, may apply to the FWC for the FWC to deal with the dispute.

• [29] The dictionary at clause 12 of the FW Act refers to s.386 for the definition of 'dismissed'. Section 386 provides:

(a) the person's employment with his or her employer has been terminated on the employer's initiative; or

(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.

(2) However, a person has not been dismissed if:

(a) the person was employed under a contract of employment for a specified period of time, for a specified task, or for the duration of a specified season, and the employment has terminated at the end of the period, on completion of the task, or at the end of the season; or

(ii) whose employment was for a specified period of time or was, for any reason, limited to the duration of the training arrangement;

and the employment has terminated at the end of the training arrangement; or

(i) the demotion does not involve a significant reduction in his or her remuneration or duties; and

(ii) he or she remains employed with the employer that effected the demotion.

(3) Subsection (2) does not apply to a person employed under a contract of a kind referred to in paragraph (2)(a) if a substantial purpose of the employment of the person under a contract of that kind is, or was at the time of the person's employment, to avoid the employer's obligations under this Part.

• [30] I have considered the submissions made by the parties and all the evidence in my determination of this matter and the conclusions I have reached.

• [31] Mr Folan alleged that he was terminated by Freo due to temporary absence from work because of illness or injury. However, this claim cannot be determined until the Commission deals with the matter under s.368, and only if the Commission issues a certificate of attempted conciliation under s.368(3). Under s.368, the Commission may deal with the matter in numerous ways including by mediation or conciliation, or by making a recommendation or expressing an opinion.

• [32] If there is a dispute as to whether an alleged dismissal has occurred, this is a preliminary issue which, according to the Federal Court Full Court decision in Coles Supply Chain Pty Ltd v Milford,[1] "must be resolved before the powers conferred by s 368 can be exercised at all".[2]

• [33] In this regard, the Full Bench in Lipa Pharmaceuticals Ltd v Mariam Jarouche[3] stated,

Where the respondent to a s 365 application contends, in its response to the application or otherwise, that the application was not validly made because the applicant was not dismissed, this must be determined prior to the Commission 'dealing' with the dispute under s 368 including by conducting a conciliation conference.[4]

• [34] Mr Folan did not articulate whether he was relying on s.386(1)(a) or s.386(1)(b) of the FW Act in claiming that he was dismissed. After reviewing the relevant authorities, the Full Bench in Bupa Aged Care Australia Pty Ltd T/A Bupa Aged Care Mosman v Tavassoli[5] stated the following in relation to the proper construction of s.386(1) of the FW Act with respect to resignation:

(1) There may be a dismissal within the first limb of the definition in s.386(1)(a) where, although the employee has given an ostensible communication of a resignation, the resignation is not legally effective because it was expressed in the "heat of the moment" or when the employee was in a state of emotional stress or mental confusion such that the employee could not reasonably be understood to be conveying a real intention to resign. Although "jostling" by the employer may contribute to the resignation being legally ineffective, employer conduct is not a necessary element. In this situation if the employer simply treats the ostensible resignation as terminating the employment rather than clarifying or confirming with the employee after a reasonable time that the employee genuinely intended to resign, this may be characterised as a termination of the employment at the initiative of the employer.

• (2) A resignation that is "forced" by conduct or a course of conduct on the part of the employer will be a dismissal within the second limb of the definition in s.386(1)(b). The test to be applied here is whether the employer engaged in the conduct with the intention of bringing the employment to an end or whether termination of the employment was the probable result of the employer's conduct such that the employee had no effective or real choice but to resign. Unlike the situation in (1), the requisite employer conduct is the essential element.[6]
• [35] Given that the cessation of Mr Folan's employment arose from the parties agreeing to the Deed on 12 December 2024 and signing it several days later, I believe that it is unlikely that Mr Folan is alleging that he resigned in the 'heat of the moment'. Mr Folan's contention that he was forced to sign the Deed appears to be a submission that he was forced to resign from his employment because of conduct, or a course of conduct, engaged in by Freo. I have therefore applied s.386(1)(b), and not s.386(1)(a), when determining this matter.

• [36] It appears that the circumstances which led to the cessation of Mr Folan's employment could have been avoided if Freo had information from Mr Folan's doctor about his medication and confirmation that the medication would not have a detrimental impact on Mr Folan's ability to perform his job safely. Such information was required by Freo's drug and alcohol policy as well as a declaration by Mr Folan that he was taking the medication. There is insufficient evidence before me to establish that Mr Folan provided this information to Freo. In any event, even if Mr Folan had already provided this information, he could have provided it again in response to the letter dated 3 December 2024 but there is no indication that he did so.

• [37] Mr Folan provided extensive email correspondence between Freo and himself during the period from 25 November to 10 December 2024, which is the date that he received the 'show cause' letter. It is clear from this correspondence that Mr Folan was feeling aggrieved and distressed about not being able to return to the workplace. Following this date, Mr Folan's union representative entered into negotiations with Freo on behalf of Mr Folan and these negotiations led to Mr Folan signing the Deed which confirmed his employment would terminate by mutual agreement on 12 December 2024.

• [38] The parties did not provide any emails to the Commission which showed the negotiations about the Deed or which show Mr Folan being consulted about the negotiations or the terms of the Deed. There is no indication that Mr Folan's feelings of distress continued beyond 10 December 2024 and during the period which culminated in the signing of the Deed. There is therefore no evidence before the Commission, apart from Mr Folan's verbal testimony at the hearing, that establishes that Mr Folan was pressured by Freo or his financial circumstances to sign the Deed.

• [39] The emails in evidence between Ms Aucote, and Mr Folan in relation to the return of Mr Folan's property on 13 December 2024, three days before Mr Folan signed the Deed, establish the following:

• Ms Aucote asked Mr Folan whether the Deed had been signed, noted that payroll had already been processed that day, and said that she would do her best to get the payment actioned as soon as she had the signed Deed.
• Mr Folan said in his response that he would 'survive until next week without the money.'

• [40] On 18 December 2024, Mr Folan raised concerns about his financial situation, but this was two days after he signed the Deed.

• [41] Freo claimed during the hearing that it paid Mr Folan the settlement monies on 22 December 2024. This was not disputed by Mr Folan and I note that this timeframe complied with the terms of the Deed.

• [42] Given that Freo did not dispute that it was required to pay Mr Folan during the period that he was stood down, I believe that it should have paid Mr Folan his full fortnightly salary on 8 December 2024 and not waited until 22 December 2024 to do so. However, there is nothing in the correspondence before me which indicates that this is the reason that Mr Folan signed the Deed on 16 December 2024 and agreed to his employment ending on 12 December 2024.

• [43] As noted above, Mr Folan stated on 13 December 2024 that he would 'survive until next week without the money' which suggests that he was not experiencing financial stress at the time the parties reached agreement on 12 December 2024 or when he signed the Deed on 16 December 2024. I accept that Mr Folan's email dated 18 December 2024 shows that he was concerned about his financial situation at that time. However, as this email was sent after Mr Folan signed the Deed, these concerns cannot be relied upon by Mr Folan as the reason that he signed the Deed, especially in light of the statements in his email of 13 December 2024.

• [44] For these reasons, I do not accept that Mr Folan was forced to agree to the termination of his employment because of conduct, or a course of conduct, engaged in by Freo. As such, I find that Mr Folan was not dismissed.

• [45] If I had found that Mr Folan was dismissed, it is unlikely that I would have been able to deal with Mr Folan's application because of the Deed. During the case management conference on 20 February 2025, and at the commencement of the hearing of the matter, I spent some time explaining to the parties that the Commission does not have power to set aside a deed of release. After receiving this information, Mr Folan advised that he wished to proceed with his application but did not make any submissions in relation to the Commission's powers with respect to dealing with a matter involving parties who had signed a deed of release. Ultimately, I do not need to consider the issue of the Deed further given my finding that Mr Folan was not dismissed.

• [46] I have found that Mr Folan was not dismissed within the meaning of s.386(1) of the FW Act. Mr Folan is therefore not eligible to make an application under s.365. The application is dismissed.

[1] [2020] FCAFC 152.

[3] [2023] FWCFB 101.

[5] [2017] FWCFB 3941.

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