s.365 - Application to deal with contraventions involving dismissal

Application to deal with alleged contraventions involving dismissal - whether applicant "dismissed" within the meaning of s.386(1)(a) - employment relationship and contract of employment

• [1] On 19 October 2025 Ms. Izabela Dembowska filed an application under s.365 of the Fair Work Act 2009 (Cth) (Act) for the Fair Work Commission to deal with a dispute in which it was alleged that Ms. Dembowska had been dismissed by the respondent, Abergeldie Personnel Pty Ltd, in contravention of the general protections provisions in Part 3-1 of the Act. The respondent objected to the application on the basis that the applicant was never employed by them and so could not have been 'dismissed' for the purposes of s.365 of the Act. I am required to deal with that objection before the application can proceed any further.[1]

[2] The facts are largely uncontroversial. On 29 July 2025 the applicant applied for a position with the respondent as commercial manager. On 29 August 2025 a letter of offer was sent to the applicant by the respondent. It provided, relevantly, that the full-time position was to commence on 7 October 2025 and that to accept the offer the applicant should sign the document by 1 September 2025. It also provided that "a more detailed employment agreement, based on the above conditions will be sent to you upon acceptance of this letter of offer." The letter of offer also included the following:

1. By accepting this offer, you warrant that there are no limitations on your ability to fully perform all of your duties and responsibilities for Abergeldie, including but not limited to physical or psychological limitations.

[3] The letter of offer was signed by the applicant on 3 September 2025. On the same day a deed of confidentiality and restraint (Deed) was provided to the applicant by the respondent. The applicant was defined as 'the Employee' in the Deed. The recitals in the Deed included the following:

1. The Employee is employed by Abergeldie Personnel Pty Ltd ABN 34 128 796 047 which is a subsidiary company of Abergeldie Holdings Pty Ltd ABN 76 126 110 594.

1. The Employee is or, is to be, engaged by the Company as Commercial Manager ('Engagement'). The Employee acknowledges that during the course of and as a result of the Engagement, the Employee has or will have access to or has or may become acquainted with Confidential Information and Trade Secrets.

1. The Company and Employee have agreed to enter into this Deed of Confidentiality and Restraint and an Employment Agreement has been entered with Abergeldie Personnel Pty Ltd to record the terms and conditions of the Employee's employment.

• [4] The Deed provides that the Employee must not, during 'the Engagement and enduring after termination of employment,' disclose or otherwise deal with confidential information other than on certain terms.[2] It provides that 'during the term of the Employee's employment' title to materials and intellectual property rights arising from materials will vest in the respondent.[3] It imposes restrictions on the Employee from doing certain things 'during the Engagement and for the Restricted Period.'[4] It further provides that breach by the Employee of the terms of the Deed will be regarded as serious misconduct giving rise to, among other things, the right to terminate the employee's employment.[5]

[5] The Deed is dated 3 September 2025, but the electronic records indicate that it was signed by the applicant on 16 September 2025. I accept that it was signed on that latter date.

[6] On 4 September 2025 the respondent sent the applicant an email which required the applicant to provide documents and complete mandatory induction modules. The email said in part, "Welcome to Abergeldie Complex Infrastructure! We're thrilled to have you joining our team. To ensure a smooth start please complete the following information prior to your first day...Additionally, please upload the following documents to your Rapid portal. The following must be completed prior to your commencement ... Degree/Qualification (if applicable)."

• [7] Initially the applicant's evidence was that she signed an employment agreement with the respondent on 3 September 2025[6] but it was later clarified in cross-examination that the agreement was signed on 16 September 2025. The employment agreement was in evidence (and dated 3 September 2025) as was the electronic record associated with the generation, transmission and signing of the document. The latter record indicates that the document was signed by the applicant on 16 September 2025. The document itself records the date of the applicant's signature to be 16 September 2025. I accept that to be the date of signature by the applicant.

• [8] The employment agreement provides, in the recitals, relevantly, that the employer has offered the employee employment as commercial manager and the employee has accepted that offer. It also provides that the parties have agreed to enter into the agreement and the Deed to record the terms and conditions of the employee's employment. The agreement goes on to provide that, the employee's commencement date is on 7 October 2025,[7] the employee is employed by the employer in the position of commercial manager,[8] the agreement commences on the date of the agreement[9] and that except for the Deed, the agreement constitutes the entire agreement between the parties and supersedes any prior agreement between them. The agreement also says that a conditional (sic) precedent of the agreement is the execution of the Deed.[10]

[9] On the 16 September 2025 the applicant resigned her employment with her then employer and indicated to them that her last day would be 3 October 2025. The applicant continued to work for that employer until 3 October 2025.

[10] The respondent's evidence was that by 23 September 2025 the respondent's onboarding team had raised concerns with the respondent's General Manager, Ms. Owen, that the applicant had not completed certain 'pre-employment requirements' including providing confirmation of working rights and educational credentials. Ms. Owen emailed the applicant on that day asking for certain documents to be provided.

[11] On 25 September 2025 the applicant provided two translated documents. According to the respondent, by 29 September 2025 the applicant had not uploaded a construction induction card and had not commenced or completed online inductions. I accept that evidence. The respondent said that the applicant had been provided with access to the respondent's Rapid Induction System for this purpose but did not have access to the respondent's internal system which requires separate secure access which is only provided when an employee is issued with a company laptop on their first day of employment after they have completed their inductions. I also accept that to be the case.

[12] By 29 September 2025 Ms. Owen had developed concerns that the applicant was not suitable for the position of commercial manager based on her reassessment of business needs and concluded that the applicant did not meet the pre-employment requirements. Ms. Owen telephoned the applicant on that day to say that the pre-employment process had ceased and the offer was withdrawn. Written correspondence from Ms. Owen was provided on that day which included the following:

I am writing to you to confirm that following a review of business requirements, we are no longer proceeding with the role of Commercial Manager and ending the employment agreement effective today, 29 September 2025. You will receive one week's payment in lieu of notice.

[13] The applicant did not commence or undertake any work for the respondent.

[14] Section 386 of the Act sets out when a person is taken to have been dismissed for the purposes of s.365. It provides, relevantly:

(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.

[15] The applicant maintained that she had been dismissed within the meaning of subclause (a) of s.386(1). She submitted that a binding employment contract was formed between the parties on 3 September 2025 when she said initially that the employment agreement was signed. The applicant said that the express terms of the agreement provided that the agreement was to commence on that day and that there were no other terms that had the effect of delaying the commencement of the contract until onboarding or induction completion or actual attendance at work. She said that the contract contained only one condition precedent and that was the completion of the Deed, a condition which had been fulfilled. Further, the applicant said that the agreement contained the full range of employment rights and obligations and was not in the nature of a pre-employment agreement. The applicant said that the 'welcome email' of 4 September 2025 confirmed that a binding agreement had been entered into and indicated at most, that delays with pre-commencement processes might delay the commencement of work but did not provide that a binding employment agreement was vitiated by such delays. The applicant said that the contract had been accepted and executed and was binding on the parties. The applicant said that there was no 'withdrawal of offer' by the respondent but rather a termination of the contract and therefore a dismissal on the respondent's initiative.

[16] The respondent contended that the letter of offer was subject to any limitations the applicant had on her ability to perform her duties and that there could be no employment relationship until those conditions were met. They said one of those conditions was satisfactory proof of the applicant's legal qualifications and that this had not been provided. The respondent said that there had been an offer of future employment but that 'acceptance was not fulfilled as the pre-employment requirements were not met in accordance with the terms contained within the offer.' Consequently, according to the respondent, the offer was 'withdrawn.'

[17] The respondent also submitted that the applicant's employment had not commenced because, amongst other things, onboarding was not completed, there was no formal commencement of the job, no services were performed by the applicant, and no payment was received by her. The respondent submitted that as the applicant's employment had not commenced the applicant could not therefore have been dismissed by them.

• [18] Employment contracts and employment relationships are related but distinct concepts.[11] It is commonplace for a contract of employment and an employment relationship to co-exist and begin and end at or about the same time. Typically, the employment relationship has its origins in, and rests upon, a contract of employment.[12] In Broadlex Services Pty Ltd v United Workers' Union[13] Katzmann J said:

[61] The employment relationship is "inherently" a contractual one. Consequently, there can be no employment relationship without a contract of employment. As McHugh and Gummow JJ observed in Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 436:

The evolution in the common law as to the relationship of employment has been seen as a classic illustration of the shift from status (that of master and servant) to that of contract (between employer and employee).

[62] Nevertheless, there is a difference between the employment relationship and the contract of employment. A contract of employment can come into existence before the employment relationship is formed and an employer who withdraws an offer of employment after it has been accepted or an employee who resigns before the starting date can be liable for breach of contract.

• [19] In Khayam v Navitas English Pty Ltd t/a Navitas English[14] (Khayam) a Full Bench of the Commission considered a situation in which a series of fixed term contracts had operated and an employer had advised the employee that they would not be renewing the contract when the last of those contracts came to an end. After a detailed consideration of the history of legislative provisions relating to termination of employment and the case law in which those provisions had been considered, the majority in Khayam said:

The analysis of whether there has been a termination at the initiative of the employer for the purpose of s 386(1)(a) is to be conducted by reference to termination of the employment relationship, not by reference to the termination of the contract of employment operative immediately before the cessation of the employment. This distinction is important in the case of an employment relationship made up of a sequence of time limited contracts of employment, where the termination has occurred at the end of the term of the last of those contracts. In this situation, the analysis may, depending on the facts, require consideration of the entire employment relationship, not merely the terms of the final employment contract.[15]

• [20] In NSW Trains v. James[16] (James) the Full Bench was dealing with circumstances in which an employee had been demoted but remained in an employment relationship with the employer. In concluding that the first instance decision-maker had erred by not holding that the expression 'the person's employment with his or her employer has been terminated on the employer's initiative' was capable of being a reference to the termination of the employee's contract of employment on the employer's initiative, the majority said:

We agree with the proposition that the expression 'employment ... has been terminated' in s.386(1)(a) means termination of the employment relationship and/or termination of the contract of employment. Contrary to the Deputy President's view at first instance, on this construction, unless the circumstances in s.386(2)(c) apply, an employee may be dismissed within the terms of s.386(1)(a) if the employer has repudiated the employee's contract of employment by demoting the employee and the employee has accepted that repudiation but has continued to be employed by the employer under a new employment contract.[17]

[21] It should be noted that the conclusion in James arose in circumstances where there was a longstanding employment relationship between the parties which was a relationship that also endured beyond the contractual repudiation constituted by the demotion.

• [22] It is apparent from the above authorities that in different factual scenarios, the termination of employment referred to in s.386(1)(a) can embrace the bringing to an end of either the employment relationship or the contract of employment, or both. More recently, and in the context of considering whether the termination of an 'outer limit' contract at the expiry of its term could constitute a dismissal, a Full Court of the Federal Court of Australia in Alouani-Roby v. National Rugby League Ltd[18] said:

[63] ....At least for present purposes, distinctions between employment relationships and employment contracts are artificial: the termination of an employment relationship and the termination of an employment contract are the same thing. Employment relationships can be created, changed and brought to an end; but (leaving aside possible exceptions involving repudiatory breach, as to which see Visscher v Giudice [2009] HCA 34; (2009) 239 CLR 361) only ever upon the execution, variation or termination of an employment contract. That being so, the reference in s 386(1)(a) of the FW Act to "the person's employment with his or her employer [having been] terminated" can only be understood as a reference to the person's contract of employment being brought to an end (or, perhaps in some cases, repudiated).

• [23] The observations of the Full Court in Alouani-Roby above must however be considered in the context of the matter with which the Court was dealing. First, the comments were obiter dicta; the disposition of the appeal had been determined on another basis, namely that the exclusion in s.386(2)(a) for contracts for a specified period of time applied and applied irrespective whether the contract provided for earlier modes of termination.[19] The appellant's circumstances were therefore incapable of constituting a dismissal for the purposes of s.386(1)(a). Second, the comments were made in circumstances where the Court was considering a series of successive outer-limit contracts and how the ongoing employment relationship established by those contracts bore upon the appellant's expectation of a contract renewal and a continuation of the relationship. The Court observed that employment was by its nature, a product of contract[20] and that the existence and nature of the relationship would inevitably be influenced by the existence or nature of the contract which underpinned it. I do not however take the comments to mean that absent any employment relationship at all, the termination of an employment contract can by itself constitute a termination of a person's employment on the employer's initiative, and therefore a dismissal for the purposes of s.386(1)(a).

• [24] In Lattouf v Australian Broadcasting Corporation (No 2)[21] Rangiah J considered the meaning of the words "terminate an employee's employment" in s 772(1) of the Act and concluded:

In my opinion, the phrase refers to termination of the employment relationship. This construction is consistent with the way similar phrases have been construed in ss 119 and 386(1) of the FWA: see Broadlex Services Pty Ltd v United Workers' Union [2020] FCA 867; 296 IR 425 (Broadlex) at [90]; Quirk v Construction, Forestry, Maritime, Mining and Energy Union [2021] FCA 1587; 312 IR 359 (Quirk) at [223].[22]

[25] In the present case I am of the view that the parties entered into a binding employment contract when the applicant signed the letter of offer on 3 September 2025. The parties had capacity to enter into such a contract. The terms of the document make it clear that they intended to enter into binding legal relations with the other. The document is couched in terms of offer and acceptance and by signing the document the applicant plainly accepted the respondent's offer. The terms are clear and relatively comprehensive and there is consideration in the form of mutual promises to perform work in a particular role and be remunerated accordingly.

[26] To the extent the respondent argues that the agreement was not binding because the applicant warranted that there were no limitations on her ability to perform her duties and she was unable to do so because she had not provided sufficient evidence as to her qualifications, I would reject the argument. At most, the clause in the letter of offer is a warranty on the part of the applicant. A failure to fulfil the warranty given may sound in a remedy for breach of contract, but it does not render the contract itself of no effect.

[27] In any event, the letter of offer and the agreement ultimately reflected in it was overtaken by the subsequent employment agreement. That agreement was executed by the applicant on 16 September 2025 and upon execution, became a binding employment contract with effect from 3 September 2025. Its terms make clear that the parties intended to create a binding agreement from that date. Moreover, the written employment agreement was expressed as being the entire agreement between the parties, save for the Deed, and one which superseded all previous agreements and warranties made by either party. There were no equivalent provisions or warranties as to limitations on the applicant's ability to perform as were contained in the earlier letter of offer. The only condition precedent referred to in the employment agreement was the execution of the Deed, which by that stage the applicant had already signed.

[28] I am therefore of the view that there was a binding employment contract between the parties as at 29 September 2025. The respondent's own correspondence on that date acknowledges the existence of such a contract and proceeds to bring the agreement to an end. That correspondence amounted to a termination of the applicant's contract of employment.

• [29] However, that is not the end of the matter. Although a binding contract had been entered into, there was no employment relationship between the parties at any time, including as at 29 September 2025. The applicant had not commenced any work for the respondent and had not contracted to do so until 7 October 2025. The applicant had not attended the workplace and had not been directed to undertake any work. The applicant had only been asked to complete pre-employment tasks such as the induction modules. The 'onboarding' processes had not been completed. The applicant did not have secure access to the respondent's information systems. Moreover, the applicant remained in an employment relationship with her previous employer as at 29 September 2025 and beyond.[23] I conclude that the applicant's employment with her employer was not terminated on the employer's initiative because the applicant's employment had not commenced by 29 September 2025. The applicant was therefore not dismissed for the purposes of s.365.

[30] The applicant resigned her previous position to accept the offer of employment that had been made by the respondent and which was later 'withdrawn' by them. Whether the applicant has a cause of action for breach of the employment contract between herself and the respondent is a different issue to the question I have been required to determine here.

Ms O Valaire, appearing on behalf of the respondent

[1] Coles Supply Chain Pty Ltd v Milford [2020] FCAFC 152.

[11] See Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd [2022] HCA1 at [40]-[41], [105], [110]-[111].

[12] Barnett v Territory Insurance Office [2011] FCA 968; (2011) 196 FCR 116 at [24].

[13] [2020] FCA 867; 296 IR 425. See also Kelly v Melba Support Services Australia Ltd T/A Melba Support Services [2021] FWCFB 4845 at [20]- [21].

[14] [2017] FWCFB 5162.

[16] [2022] FWCFB 55.

[18] [2024] FCAFC 161.

[21] [2025] FCA 669.

[23] See Anastasia Perri v Oral Health Victoria [2026] FWC 507 at [12].

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