To Act or Not to Act – Employee resignation in the heat of the moment

There have often been questions asked about whether to accept an employee’s resignation in the heat of the moment. If previous rulings are anything to go by, then the general rule of thumb is no. A point which was recently emphasised in Audrey Campbell v Gold Tiger Logistics Pty, where the employer was deemed to act too hastily when an employee resigned in the heat of the moment. A ‘hasty’ decision which saw the maximum compensation of 26 weeks pay handed down by the Fair Work Commission (FWC), totalling $32,000.

Key Issues

The central issue in this case was whether the applicant had resigned from her employment following a heated argument with her manager. The evidence presented differed on whether the applicant said words to the effect of “I quit,” as alleged by her employer, or if she had said, “This is sh*t,” as she claimed.

During the hearing, the applicant conceded that her manager might have misheard her due to her thick Scottish accent.

FWC Findings

The FWC ultimately favoured the applicant’s evidence, determining that she had not resigned during the discussion. Even if the applicant had said “I quit,” the FWC held that this was said in the heat of the moment and not intended as a resignation.

The FWC referenced a passage from Mr Sumeet Thakur v Assetlink Services Pty Limited, which considers whether a resignation is effective in the heat of the moment:

“A resignation that is given in the heat of the moment or under extreme pressure may constitute special circumstances, such that a period of time should be allowed to elapse and/or further enquiries made as to whether the resignation was intended. If a resignation is not withdrawn within a reasonable time, this may suggest the resignation was intended.”

As the applicant had not resigned, the FWC found she had been dismissed and that:

• there was no valid reason for the dismissal
• she was not given an opportunity to respond; and
• the dismissal was harsh, unjust, and unreasonable.

Compensation

The Commission deemed reinstatement inappropriate and awarded the applicant the maximum compensation of 26 weeks’ wages, totalling $32,000. This award was significantly influenced by the fact that the applicant was close to retirement and intended to work with the respondent until then.

Key Takeaways

Employers who hastily accept an employee’s resignation in the heat of the moment risk facing an unfair dismissal application and a subsequent finding of wrongful dismissal. In such situations, employers should allow a reasonable period before acting on the resignation and/or make inquiries to ascertain if the employee intended to resign.

Need More?

Ending an employee’s employment is not always straight forward. Before you act reach out to the Workplace Relations and Legal Team on 02 6175 5900 for timely support and advice when you need it most.