FWAFB 2670
FAIR WORK AUSTRALIA
Workplace Relations Act 1996
s.120 - Appeal to Full Bench
VICE PRESIDENT LAWLER
SYDNEY, 9 APRIL 2010
Appeal – termination of employment – whether termination at the initiative of the employer – employee required to show cause why her employment should not be terminated – employer rejected employee’s response, maintained that summary dismissal was warranted and offered resignation – offer not accepted – no formal termination – whether repudiation of contract of employment by the employer accepted by the filing of an application for relief against termination of employment.
 This is an application for leave to appeal and, if leave is granted, an appeal against the decision of Commissioner Raffaelli given on 30 October 2009 upholding a jurisdictional objection by the respondent and dismissing the appellant’s application for relief against termination of employment. The jurisdictional objection upheld by the Commissioner was that there was no termination at the initiative of the employer.
 It is common ground that the effect of the transitional provisions means that, although this appeal is being heard and determined by Fair Work Australia, it does by reference to the provisions of the Workplace Relations Act 1996 (Cth) (“WR Act”).
 The appellant made a complaint of sexual harassment against a manager. The respondent conducted an investigation in relation to that complaint and concluded that it was not substantiated because the conduct as alleged did not occur. It wrote to the appellant on 1 May 2009 informing her of this outcome of the investigation. In a separate letter to the appellant’s solicitor on that day (‘show cause’ letter) the respondent stated:
“I refer to our telephone conversation on 24 April 2009 regarding the Company’s finding in relation to an investigation into a complaint made by Ms Dover-Ray (“the Investigation”). I enclose a letter that confirms the Company’s finding and the outcome of the investigation.
Unfortunately, since our telephone discussion, the Company has been made aware of conduct by Ms Dover-Ray that demonstrates her willingness to act in a way that is contrary to the interests of the Company by:
Ms Dover-Ray's actions have caused the Company to assess its position in relation to Ms Dover-Ray's ongoing employment with the Company. By her actions Ms Dover-Ray has willfully and deliberately conducted herself in a way that is inconsistent with the continuation of her contract of employment. Ms Dover-Ray has demonstrated this by:
In light of the totality of Ms Dover-Ray's above conduct, the Company has determined that Ms Dover-Ray should show cause by or before 5pm Tuesday, 5 May 2009 as to why she should not be summarily dismissed from the Company.”
 Throughout the period from early May 2009 the appellant was on leave with the knowledge and informal endorsement of the respondent.
 On 5 May 2009 the appellant sent an email to the respondent’s corporate counsel expressing her shock and disappointment at the respondent’s approach and stating “[i]t is with total disbelief that I find myself, whilst representing the company and its best interests in this position where you continue to ‘blame the victim’.” The email asserts that “the charges against me are trivial and without substance” and proceeds to offer a response to those ‘charges’.
 On 6 May 2009, the appellant’s solicitor also wrote to the respondent providing a response to the matters raised in the respondent’s letter of 1 May 2009. In summary, the position adopted on behalf of the appellant was that she had “no reason to show cause as requested. She has undertaken no behaviour that would permit the company to dismiss her as suggested.”
 The appellant had been due to return to work on 18 May 2009. Shortly before 18 May 2009 the appellant had a telephone conversation with Ms Marissa South, another employee of the respondent, and was told that her position had been advertised.
 The appellant gave evidence that on 8 May 2009 she spoke to Ms Katerina Romanelli of the human resources department by telephone. The appellant claimed that the purpose of this call was to ascertain her employment status. She gave the following evidence:
“I had spoken to Katerina regarding my employment there and said I didn't know what, where I stood or what would happen, but in the likelihood that I was going, if I was to be terminated I would need to get a reference and if she would be able to provide a reference for me, and she didn't at the time know what my position within the company was going to be because she'd been taken off it and said that she would see about getting a reference for me.”
 In terms of proof that the respondent was advertising the appellant’s position, this evidence is hearsay. However, Commissioner Raffaelli was not bound by the rules of evidence. He admitted that evidence and the respondent chose not to call any evidence to contradict it.
 Later that day Ms Romanelli wrote a letter to relevant managers saying:
“Please note I received a text from Tamicka [Ms Dover-Ray] today, asking me to provide a verbal reference for her. I called her back to let her know that I am not in a position to give her a reference.
She stated that she needs to move on with her life and find employment if she is terminated from Real Insurance. I did not respond to this statement.”
 On 21 May 2009 the respondent wrote to the appellant’s solicitor in the following terms:
“We understand that you act for Ms Dover-Ray.
I refer to your letter dated 6 May 2009 (“the Reply”).
1. With respect, the Reply does not justify nor mitigate your client’s conduct and in our view, the conduct warrants summary dismissal. Notwithstanding that view, we re-issue our earlier offer that the employment end by mutual agreement and that your client provided the Company with a full release in relation to her employment and its cessation (save in respect of workers’ compensation). In that regard, attached is a Deed of Release in the same form as previously provided, save that it also provides for a statement of services and one point of contact the to [sic] to any requests for references in accordance with an agreed script. The offer is open until 4.00 pm on Tuesday, 26 May 2009 subject to paragraph (2).
2. Importantly, if the Offending Publication remains on your client’s My Space blog at noon on 25 May 2009, this offer will automatically terminated at that time.
3. Your request for documents in the Reply is a fishing expedition and presents issues regarding the confidentiality of the statements and evidence that the Company has collected. Your request is rejected.”
(bold emphasis in original, underline emphasis added)
 On 22 May 2009 the appellant’s solicitor again wrote to the respondent responding further to the ‘show cause’ letter but also in relation to the respondent’s letter of 21 May 2009. The letter included the following:
“… Our client does not accept the findings [in the letter of 1 May 2009], and believes the investigation was flawed, and biased against her for the following reasons:
We refer to the letters dated 1 May 2009, and 21 May 2009, which clearly indicate the company’s intention to terminate our client’s employment. There is nothing in our client’s conduct to justify or support the conclusion that her behaviour warrants summary dismissal. … There has been no breach of confidentiality as alleged. It may be that management is unable to cope with the clear criticism of its conduct, but the blog referred to does not disclose any identifying information that would permit the ordinary person to believe or know that the Company was involved.
It appears that the Company in now attempting to terminate our client is continuing its victimisation of our client which commenced with the interview process after she lodged her complaint. Clearly, the threat to her employment is a detriment and in breach of S50(1)(c) Anti-Discrimination Act: S94(2)(g) Sex Discrimination Act.
We are instructed that our client believes that any attempt to terminate her employment would be an unfair dismissal, and also in breach of the Anti-Discrimination legislation. If the Company continues with this course of action, we are instructed to file appropriate proceedings in regard to the employer's flagrant breaches, and to seek compensation for our client.
Therefore, our client does not accept the Company's proposal in regard to her employment, and considers it as offensive and further evidence of the victimisation the Company is attempting to inflict upon her. …”
 On 4 June 2009 the appellant’s solicitor wrote to the respondent’s corporate counsel in the following terms:
“We refer to this matter and note we have responded to the Director of Operations letter of 21 May 2009, on 22 May. We have not had the courtesy of a reply. This is clearly unsatisfactory.
Our client has had the threat of summary dismissal made, with no subsequent advice as to whether it has occurred. Further, it has been made clear to her that she is not to attend the work premises.
We also note that our client was on medically approved leave due to the stress caused by sexual harassment at her place of employment and was due to return on 18 May 2009. She was receiving workers’ compensation payments, but they ceased on 30 April 2009. Our client has received no wages since then.
We can only assume there has been a constructive dismissal of our client’s employment with effect since 26 May when summary dismissal was threatened, although no confirmation of such has been provided. We are instructed to commence proceedings for unfair dismissal, unless a positive response is received by 4 pm on June 5 next.
We also demand that the employer pay our client her outstanding wages from 30 April, forthwith. In this regard we note our client’s instructions that the Director of Operations during the interview process informed our client to take as much leave as necessary, to recover, and he would ensure her wages were paid.
Clearly, the employer’s behaviour to date evidences our client’s assertions that she is being victimised as a consequence of her sexual harassment complaint, in clear breach of State and Federal legislative provisions.
We await your response.”
 The respondent’s corporate counsel was on leave for the period 11 May 2009 to 22 June 2009. Arrangements had been made for her correspondence to be opened and also for any correspondence relating to the appellant’s matter was forwarded to the appropriate manager, Mr Grubler. The respondent does not deny receipt of the letter of 4 June 2009, however, Mr Grubler’s evidence was that he did not see it. The better inference is that there was some misunderstanding or inefficiency in communication which meant that the letter, although received by the respondent, did not find its way to Mr Grubler’s desk.
 The appellant received no response to her solicitor’s letter of 4 June 2009.
 On 15 June 2009 the appellant filed her application for relief against termination of employment. It is common ground between the appellant and the respondent that the appellant’s employment with the respondent came to an end. The respondent’s central contention is that although it threatened “summary dismissal” it did not take the final step of actually dismissing the appellant. The respondent submitted that in all the circumstances the proper conclusion was that the employment had come to an end through an abandonment of employment by the appellant. 1
 On 29 June 2009, that is, after the appellant filed her application for relief against termination of employment, the respondent wrote to the appellant claiming that it had not terminated her employment:
“We are pleased to advise that although the Company maintains that it has valid grounds to terminate Ms Dover-Ray’s employment, it has decided not to do so. Indeed, the Company is genuinely hopeful that never again will there be grounds upon which it can validly terminated Ms Dover-Ray’s employment or take any other disciplinary action…
Ms Dover-Ray will be welcomed back to work (and should return to work), as soon as she is fit for work, subject to her compliance with the “return plan” set out in Annexure 1 to this letter…” (emphasis in original)
 Section 643(1) of the WR Act confers a right on an employee whose employment has been terminated to apply to the AIRC for relief in respect of that termination but only if that employee’s employment “has been terminated by the employer”. It is well established that the Commission has no jurisdiction to deal with an application for relief against termination of employment unless such termination was at the initiative of the employer.
 Section 642(4) of the WR Act provides:
(4) for the purposes of this Division, the resignation of an employee is taken to constitute the termination of that employee at the initiative of the employer if the employee can prove, on the balance of probabilities, that the employee did not resign voluntarily but was forced to do so because of conduct, or a course of conduct, engaged in by the employer.
 Section 642(4) has no application in this case because it only has application where an employee has resigned. The appellant did not resign her employment: at all times she was objecting to the prospect that her employment would be terminated and was seeking to contest the respondent’s decision or apparent decision that her employment should be terminate either by resignation or dismissal. The appellant’s discussion with Ms Romanelli seeking a reference was predicated on the respondent terminating her employment.
 This case is properly analysed by reference to principles of repudiation. In Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd 2 Gleeson CJ, Gummow, Heydon and Crennan JJ noted:3
“The term repudiation is used in different senses. First, it may refer to conduct which evinces an unwillingness or an inability to render substantial performance of the contract. This is sometimes described as conduct of a party which evinces an intention no longer to be bound by the contract or to fulfil it only in a manner substantially inconsistent with the party's obligations. It may be termed renunciation. The test is whether the conduct of one party is such as to convey to a reasonable person, in the situation of the other party, renunciation either of the contract as a whole or of a fundamental obligation under it. … Secondly, it may refer to any breach of contract which justifies termination by the other party. … There may be cases where a failure to perform, even if not a breach of an essential term (as to which more will be said), manifests unwillingness or inability to perform in such circumstances that the other party is entitled to conclude that the contract will not be performed substantially according to its requirements. This overlapping between renunciation and failure of performance may appear conceptually untidy, but unwillingness or inability to perform a contract often is manifested most clearly by the conduct of a party when the time for performance arrives. In contractual renunciation, actions may speak louder than words.
In the past, some judges have used the word "repudiation" to mean termination, applying it, not to the conduct of the party in default, but to the conduct of the party relying upon such default. It would be better if this were avoided.”
 As is apparent from this extract, the test for intention is not a subjective one depending on the actual intention of the repudiating party. Intention is to be judged from what the other party reasonably infers from the actions or words of the party who is alleged to have repudiated the contract. 4
 A repudiation of a contract does not automatically terminate that contract. Rather, the contract comes to an end only when the other party elects to accept such repudiation. 5 Such acceptance may be by words or conduct. The learned authors of Macken’s Law of Employment6 note that acceptance of a repudiation may be easily inferred.7
 Viewed in their totality, the actions of the respondent evinced an unwillingness to continue the employment of the appellant amounting to a repudiation of her contract of employment, which repudiation was accepted by the appellant when she filed her application for relief against termination of employment. The ‘show cause’ letter of 1 May 2009 demonstrated that the respondent regarded the appellant as having engaged in misconduct warranting summary dismissal and sought to provide her with an opportunity to show cause why she should not be dismissed. By the email of 5 May 2009 and the letter of 6 May 2009, the appellant, both directly and through her solicitor, provided a substantive response to that invitation to show cause. The respondent’s letter of 21 May 2009 demonstrated that:
(i) the respondent did not regard the appellant’s response as an acceptable response to the matters raised in the ‘show cause’ letter; and
(ii) notwithstanding that appellant’s response, the respondent considered that summary dismissal was still warranted.
 The respondent’s letter of 21 May 2009 offered a mutually agreed separation by way of resignation and specified a clear timeframe within which that offer was open for acceptance. A reasonable person in the position of the appellant would have concluded that the respondent had decided that the appellant’s employment should terminate and the only issue was whether this would be by way of resignation or dismissal. On a fair reading of the correspondence, the letter of 21 May 2009 made it clear that the respondent would proceed to summarily dismiss the appellant in the event that its offer of separation by resignation was not accepted. To the extent that there may have been any doubt in the mind of a reasonable person in the position of the appellant that the respondent had resolved to summarily dismiss the appellant and all that remained was the formality of dismissal in the event that separation by resignation could not be agreed, such doubt was removed by the solicitor’s letter of 4 June 2009 and the absence of any response to that letter. It matters not that such failure to respond may have been due to the letter not finding its way to Mr Grubler or another responsible manager. Whether the contract of employment was repudiated by the respondent is a matter to be determined objectively by reference to the facts conveyed or apparent to the parties.
 In summary, the contract of employment in this case was repudiated by the respondent, albeit for reasons that the respondent regards as sound. That repudiation was accepted by the appellant by the act of filing her application for relief against termination of employment. As such, the contract of employment was terminated on the date that application for relief was filed but is nonetheless properly to be regarded as a termination at the initiative of the employer because it was the respondent’s repudiation which, accepted by the appellant, brought the employment to an end. The letter of 29 June 2009 has no relevance to the issue at hand: the contract of employment had already terminated by the time that letter was sent.
 We note that a finding in relation to whether or not there has been a termination at the initiative of the employer is a finding of jurisdictional fact. This is not an appeal that is to be determined by reference to the principles in House v King 8. Rather, we are concerned with whether the finding of jurisdictional fact made by the Commissioner was correct. The finding by the Commissioner that there was no termination at the initiative of the employer was not made by reference to competing oral evidence. Rather, it was a finding made by reference to the terms of documents and uncontested matters of underlying fact. For this reason, we are in as good a position as the Commissioner to determine that finding of fact for ourselves.9 In our respectful view, the Commissioner erred in failing to recognise that on the facts before him the contract of employment had been terminated at the initiative of the employer in the manner we have explained.
 We grant leave to appeal and quash the decision of the Commissioner and his order dismissing the application for relief. On the rehearing of the respondent’s motion to dismiss, for the reasons we have given, we find that there was a termination at the initiative of the employer. We dismiss the respondent’s jurisdictional motion. It appears from the file that a conciliation may have been conducted by Commissioner Raffaelli in this matter, however, it also appears from the file that no certificate has issued. The file will be returned to Commissioner Raffaelli for him to determine whether a certificate should issue and thereafter the file should be dealt with in accordance with the usual administrative processes. In other words, it will be either allocated to another member for conciliation or to another member for arbitration as the case may be.
Mr D Currie of Counsel for the appellant.
Mr A Britt of Counsel for the respondent.
1 Appeal transcript at PN359-PN360.
2 (2007) 233 CLR 115.
3 (2007) 233 CLR 115 at paras  – .
4 See, for example, Loughridge v Lavery  VR 912 at 923.
5 Automatic Fire Sprinklers v Watson (1946) 72 CLR 435 at 450-453, 461-463, 465-467; Byrne v Australian Airlines Ltd
(1995) CLR 410 at 427-428; Visscher v The Honourable President Justice Guidice (2009) 239 CLR 361.
6 Sappiedeen, O’Grady, and Warburton, Macken’s Law of Employment (Lawbook Co, 6th edn).
7 Ibid at [7.220].
8 (1936) 55 CLR 499 at 505.
9 Warren v Coombes (1979) 142 CLR 531 at 552-553; Fox v Percy (2003) 214 CLR 118 at .
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