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Fair Dismissal Code Difference Between Dismissal Resignation And Abandoning Employment

It is important to properly classify a termination of employment as a dismissal, resignation or abandonment of employment.

The final question (no 8) of the Small Business Fair Dismissal Code asks whether an employee voluntarily resigned or abandoned his/her employment.

If the correct answer is yes, then a claim of unfair dismissal by the employee will fail and the ‘procedural fairness‘ steps explained in previous articles (see Related Material on this webpage) in this series on the Code will not apply. However, you may still be required to prove that an employee voluntarily resigned or abandoned employment, and this requires the employer to follow certain procedures.

This article, the final one in the series on the Code, distinguishes between dismissal, resignation and abandonment, and explains those procedures. The other articles in this series are noted under Related Material on this webpage.

Question 8 of the Fair Dismissal Code asks the employer to answer yes or no as to whether the employee voluntarily resigned or abandoned employment, and to provide details if the answer is yes. It is not clear what ‘details’ would be sufficient to satisfy Fair Work Australia that the employer had complied with the Code. Possibly, it simply requires the employer to state whether the employee resigned or abandoned employment.

If abandonment has occurred, it is recommended that the employer provide some further details (see discussion below).

Dismissal, resignation or abandonment?

The fundamental difference between these terms is that dismissal is termination of employment at the initiative of the employer, and the other two are termination at the initiative of the employee.

Most resignations are straightforward; an employee chooses to resign because he/she has obtained another job or has decided to stop working. In such cases, you should following these steps:
Ask the employee to confirm the resignation in writing. If you cannot do this, at least keep a record of all relevant conversations, and if possible have them witnessed, and put your own correspondence to the employee in writing.
Ensure the resignation notice complies with notice requirements. Determine a final day of work and confirm that day in writing with the employee.
If the employee does not comply with notice requirements, confirm the actual date of leaving and advise him/her of any adjustments to termination pay or entitlements that will be made.
Greater caution is needed, however, if there is conflict or controversy at the workplace leading up to a resignation. The employee may still ‘voluntarily’ resign, but there may be some element of coercion in the decision. Even if the employee has handed over a letter of resignation and the employer has ticked ‘yes’ to Q8 of the Code, circumstances may have led to the employee reaching a decision that he/she had no option other than to resign — which, of course, is no longer ‘voluntary’. Common examples of those circumstances are:

‘Forced resignation’. The employer has basically said ‘resign or you will be dismissed’, or issued some other threat.
Bullying or harassment at work.
Behaviour that amounts to ‘squeezing out’ an employee, such as ostracism, withdrawal of work tasks, or various other means of applying pressure on the employee, in the hope that he/she will resign.
Some other action that makes continued employment difficult or impossible for the employee, such as a demotion, transfer to an inconvenient location, changes to working arrangements that disadvantage him/her, withdrawal of significant employment benefits.
Courts and tribunals have sometimes found that situations such as the above are actually constructive dismissal rather than resignation. If that is the case and the employee is eligible to make a claim of unfair dismissal, then completing the Code may not prevent an employer from a finding that the ‘resignation’ was in fact an unfair dismissal, and the employee may become entitled to reinstatement, compensation or more generous termination entitlements. As noted in the previous articles, Fair Work Australia may decide to investigate an employee’s claim rather than accept the employer’s reliance on the Code without question. If so, the employer needs to have evidence that backs up the declaration it made when completing the Code questionnaire.

Abandonment of employment

This term describes the situation where an employer ceases to attend work and either fails to communicate his/her intentions to anyone or fails to provide a reasonable explanation for failure to attend. The employee is deemed to have ‘resigned’ voluntarily by repudiating the contract of employment.

Because contact with the employee is usually lost in such cases, it can be very difficult to clarify the situation, and therefore you should proceed with caution and take positive steps to attempt to contact the employee. The following steps are recommended:
Check any award, agreement or employment contract provisions that may apply. There are no standard provisions, but sometimes there will be a clause that defines ‘abandonment’, such as a prescribed amount of absenteeism without reasonable explanation.
For example, the Manufacturing and Associated Industries & Occupations Award 2010 (cl 21) provides that the absence of an employee from work for a continuous period exceeding three days without the employer's consent and without notification to the employer is prima facie evidence that the employee has abandoned employment. The employee then has 14 days from the last day of attending work or notifying the employer to satisfy the employer that he/she was absent for a reasonable cause.

Try to establish why the employee is not attending work.
For example, illness or family emergency that makes it difficult to contact the employer (eg having to travel overseas at short notice) will not give you a right to terminate employment without notice.
Attempt to contact the employee by phone, email and registered post, enquiring about the reasons for absence. If there is no reply after a reasonable period of time, or the reply is unsatisfactory, you can then send written notice of termination of employment. That notice must specify the reason for terminating employment.
If there are reasonable grounds to believe that the employee does not intend to return to work (eg reliable ‘tip-offs’ or hard evidence), write (registered post) or email the employee stating that if he/she does not return to work by a specified date, does not provide a likely date of return to work, or does not provide a satisfactory explanation for his/her absence, then employment will be deemed to have been terminated without notice as at the last day of attending work.
If you do not follow steps such as the above, it is possible that the employee may return to work at a later date with a reasonable explanation (eg a medical certificate). Depending on the circumstances of each case, termination of employment could be held to be unfair or unlawful. For example, s352 of the Fair Work Act 2009 makes it unlawful to dismiss an employee for temporary absence from work due to illness or injury.

In cases of abandonment of employment, the employer should complete the Fair Dismissal Code questionnaire on the day that employment is terminated.

Summary

An employer can answer yes to Q8 of the Code if termination of the employment was definitely a voluntary decision by the employee. If termination of employment occurred in controversial circumstances, it is recommended that you provide an explanation of what happened.
Article sourced from Workplaceinfo, A daily Bureau service for HR & IR professionals. For a free 14 day trial, contact us!
 
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