s.365 - Application to deal with contraventions involving dismissal

Application to deal with contraventions involving dismissal - jurisdiction - whether out of time - date dismissal took effect - written notice of termination - application within time - jurisdictional objection dismissed

• [1] On 19 February 2025 Mr. Rajendra Ranabhat (Applicant) filed an application alleging that he had been dismissed by his former employer, Lincoln Brokerage Services Pty Ltd (Respondent), in contravention of Part 3-1 of the Fair Work Act 2009 (Cth) (Act). The Respondent denied the contravention and objected to the application on the basis that it had been made outside the 21-day time period prescribed by s.366(2) of the Act.

• [2] Whether the application was made within the relevant statutory time period depends on the date the dismissal took effect.[1] The parties were in dispute as to that date. The Applicant said the dismissal took effect on 31 January 2025 and therefore the application was within time and no extension was required. The Respondent submitted that the dismissal took effect on 21 January 2025, that the application was therefore out of time and that the Applicant had not established that there were any exceptional circumstances justifying an extension of time.

• [3] The essential facts were uncontentious. On 14 January 2025 the Applicant was sent a "show cause" letter by the Respondent outlining various concerns with his performance and asking the Applicant to give reasons as to why his employment should not be terminated. The Applicant provided a response.

• [4] On 17 January 2025 the Applicant was sent an email (termination notice) by the Respondent in the following terms:

Thank you for your response. Unfortunately, you fail to effectively address the elements of our concerns detailed in our letter of 15 January 2025 and expressed to you during numerous verbal discussions over the past 4 months.

As detailed in this correspondence, our concerns relate specifically to your employment with Lincoln Brokerage Services from 9 September 2024 and your failure to perform your role to the level expected. You have received the highest levels of support, training and direction however fail to perform critical elements in your daily role.

As a result, your employment contract with Lincoln Brokerage Services Pty Ltd will be terminated. You are hereby given 2 weeks-notice of termination. You will not be expected to work during the notice period which will end Friday 31 January 2025. Your Supervisor will contact you on Monday 20th January to coordinate the return of your Company vehicle and other Lincoln assets. Once received back in good condition your final pay will be processed along with any unused leave accrued.

• [5] On 21 January 2025 the Applicant was paid his termination pay, including payment for the period until 31 January 2025 and accrued entitlements. On that day he also returned company property to the Respondent as requested.

• [6] The letter of offer from the Respondent to the Applicant dated 23 August 2024 was in evidence.[2] It provided for a notice period of two weeks.

• [7] The Respondent submitted that where payment in lieu of notice is made, the dismissal usually takes immediate effect. Reliance for that proposition was placed on the often-cited decision in Siagian v. Sanel Pty Ltd.[3] In that case the Industrial Relations Court of Australia (Wilcox CJ) was concerned to identify the date of the Applicant's dismissal, that date being critical to the availability of the relief sought. The Court said:

"Counsel's second argument is that, because of the payment in lieu of notice, the termination did not occur on 29 March but at the date of expiration of the period for which payment was made, 15 April. If this argument is correct, s.170EE orders are available.

This argument also raises a complex problem. The problem arises because of the ambiguity inherent in the words "payment in lieu of notice". The ambiguity was pointed out by Waite J, in Leech v Preston Borough Council [1985] ICR 192 at 196:

"... it is clear from the authorities cited to us, ... all of which are confirmed by the experience of our lay members, that the expression 'payment in lieu of notice' is regularly used throughout industry in one or other of two quite different senses. The first, which is the grammatically correct one, is when it is used to describe the payment to an employee whom it is proposed to dismiss summarily of a lump sum representing compensation for the wages or salary which he would have received if he had been given the notice to which he is entitled by law. The second, which is the colloquial and grammatically inaccurate one, is when the term is used as a convenient shorthand way of telling an employee that he is being given the full period of notice to which he is entitled by law but is at the same time excused any duty (and refused any right) that he would otherwise have under his employment contract to attend at the workplace during the notice period."

Although Waite J did not spell out the result that flowed from each meaning, it is clear from other decisions that, in the first case, the employee's employment terminates upon the date of payment of the lump sum. In the second case, the employment extends until the expiration of the period for which the payment was made.

The question whether a payment in lieu of notice immediately terminates the employment is always one of fact. In Leech at 196-197 Waite J said that the proper inference as to the sense in which the expression is used may turn upon "very subtle indications or nuances of wording which will have to be weighed carefully accordingto their context". The difficulty, of course, is that the parties will normally not have made the position clear. They will probably not have averted to the distinction made by Waite J. The Court will be left to put its own interpretation on their actions."

• [8] In Siagian there was no written termination notice as there was here. The Court determined the question of the effective date of the termination by a consideration of the conduct of the parties.

• [9] In this case the terms of the written termination notice were very clear. By that notice the Respondent had determined to bring Mr. Ranabhat's employment to an end on 31 January 2025. He was given two weeks' notice on 17 January 2025 consistent with the terms of his contract of employment as set out in the letter of offer. He was told on 17 January that the notice period would end on 31 January 2025. He was told he would not be required to work during the notice period. He was told that his final pay would be processed at some later date once company property had been returned in good condition. The Respondent did not intend to bring Mr. Ranabhat's employment to an end summarily on 17 January 2025 by paying him an amount in lieu of notice on that day, or by any other communication to him that this was what was occurring. In any event, what must be considered is what the parties by their words and conduct would have led a reasonable person in the position of the other party to believe, rather than subjective intentions.[4] Objectively construed, the termination notice conveyed an intention to bring the employment to an end on 31 January 2025.

• [10] The payment of the amount in lieu of notice following the termination notice does not change the effect of the termination notice. A notice of termination, once sent, cannot be unilaterally withdrawn or varied in a way which changes its effect.[5]

• [11] I conclude that the Applicant's dismissal took effect on 31 January 2025 and not on 21 January 2025 as contended for by the Respondent. The application made on 19 February 2025 was therefore made within 21 days of the dismissal taking effect as required by s.366(1)(a). The Applicant does not require an extension of time to lodge his application and the Respondent's objection is dismissed.

The matter will be relisted for a conference under s.368 of the Act on a date to be fixed.

By video using Microsoft Teams at 2:00pm AEST on 14 April 2025.

[1] Section 366(1).

[3] [1994] IRCA 1; (1994) 122 ALR 333.

[4] Patrone v Unique Muscle Pty. Ltd [2022] FWC 319 at [9], citing Nathan Jackson v Mahmoud Hasan Abulamoun [2020] FWC 4056.

[5] Mihajlovic v. Lifeline Macarthur [2013] FWC 9804 at [13]. See also Kot v. Health Axis Pty Ltd t/a The Hader Clinic [2018] FWC 1153.

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