Worker argues employer forced resignation through misconduct probe process
The Fair Work Commission (FWC) recently dealt with a case involving an employee who resigned while under investigation for serious misconduct, then later claimed she had been constructively dismissed by her employer's conduct.
The worker argued that her employer's investigation process had forced her to resign, claiming the company's conduct left her with no real choice but to quit.
She contended that despite formally resigning, she had actually been dismissed within the meaning of employment law and sought compensation for unfair dismissal.
The worker had been employed by the major bank for over 17 years. She worked in various roles throughout her employment and from August 2020 until her employment ended, she worked at a Newcastle branch as a personal banking adviser.
Her situation became complicated in early 2025 when serious allegations emerged about her conduct.
In February 2025, the regional general manager was notified by the bank's investigation team that an investigation was being conducted into the worker's conduct.
The allegations included submitting loan applications and conducting identity verification procedures without customers being present, transferring funds from customer accounts for personal benefit, using her personal email to handle customer documents, and submitting loan applications for individuals she had personal relationships with.
The general manager explained these allegations were serious because "if established, the conduct would amount to serious breaches of [the employer's] policies, including banking procedures, conflicts of interest, and anti-money laundering and counter-terrorism financing obligations."
The bank immediately placed the worker on special paid leave while the allegations were investigated.
Two bank employees interviewed the worker and put the allegations to her, then sent an email setting out six allegations in writing with detailed particulars.
The worker's response came just six days after receiving the written allegations. On 24 February 2025, she sent a resignation email to her direct manager and the general manager.
She wrote that she had decided to resign "effectively immediately" due to "a high level of stress" and explained she would not be able to return to work due to sickness.
She described considering a career change over the past 12 months and said recent events had reinforced that it was time to move on.
The worker acknowledged mistakes in her role, stating: "I acknowledge that I have made mistakes in my role, and I have found myself struggling with the pressure of always needing to be right. I've been beating myself up over these mistakes, and it has taken a toll on me."
In a passage that would later undermine her constructive dismissal claim, the worker wrote:
"While the ongoing investigation has certainly been stressful, I want to make it clear that my decision to leave is not directly related to it. Rather, it is based on a personal choice to move forward in a new direction, pursuing support work, which aligns with my passion for helping people."
The bank's initial response confirmed receipt of the resignation but explained that immediate departure was inconsistent with her contractual notice obligation, confirming she would remain employed until 21 March 2025.
The investigation concluded on 26 February 2025, with all six allegations substantiated. On 7 March 2025, the general manager sent a letter advising the worker that the allegations had been substantiated and that the bank was considering terminating her employment for serious misconduct.
The letter invited her to provide a response before a decision was made. The worker's response on 10 March 2025 proved significant. In two emails to the general manager, she wrote:
"I take full responsibility for my actions and understand the impact they have had. I sincerely regret all of this deeply. However, I want to make it clear that my choices were never made with any intention of personal gain. They were mistakes – poor decisions that I now fully acknowledge and deeply regret."
She also requested: "I would be extremely grateful if you were to allow me to exit with a record of resignation. I am losing my job and I am aware that due to Australian Bankers' Association Code of Conduct Protocols my employability within the banking industry will be difficult if not impossible. A resignation would allow me to seek work outside the finance industry."
The bank responded on 14 March 2025, accepting her resignation with immediate effect and confirming that without her resignation, her conduct would have warranted dismissal.
Remarkably, on 21 March 2025, the worker sent an email to the general manager titled "Thank You !!!" stating: "Firstly thank you so much for every you have done for me. I really appreciate it immensely."
The FWC noted that at no time did the worker seek to withdraw her resignation or express any intention to continue her employment.
The worker filed her unfair dismissal application on 14 April 2025, which was 10 days outside the statutory 21-day limit under section 394(2)(a) of the Fair Work Act 2009 (FW Act).
She sought an extension of time under section 394(3), which requires "exceptional circumstances." The worker explained her delay was due to miscalculating the time period, believing it referred to weekdays only rather than calendar days.
The FWC applied the established test for determining constructive dismissal under section 386(1)(b) of the FW Act.
This test asks whether the employer engaged in conduct with the intention of bringing employment to an end, or whether termination was the probable result of the employer's conduct such that the employee had no effective choice but to resign.
The Commission must consider whether the employer's actions forced the resignation.
The FWC found that the bank's conduct was entirely appropriate for dealing with serious misconduct allegations. The Commission stated:
"[The employer's] conduct is what could reasonably be expected from an employer when dealing with similar allegations of misconduct. I am satisfied that [the employer's] intentions were to investigate the allegations and, if substantiated, impose a disciplinary sanction on [the worker]."
The Commission found the worker resigned before the bank had determined whether the allegations were substantiated or decided on any disciplinary action.
The Commission noted: "[The worker] could have elected to await [the employer's] determination as to whether the allegations were substantiated or not. [The worker] could have elected to await [the employer's] decision as to any disciplinary sanction."
The worker's own words proved decisive in defeating her claim. The Commission found her resignation "cannot be both 'a personal choice to move forward in another direction' and forced by [the employer's] conduct or course of conduct."
Her subsequent thank you email further supported the finding of voluntary resignation. Regarding the extension application, the Commission found insufficient exceptional circumstances, noting she took no action to dispute her alleged dismissal and had limited prospects of success.
The Commission concluded: "[The worker] was not dismissed within the meaning of section 386(1)(b) of the FW Act. On both grounds, I am required to dismiss [the worker's] application for an unfair dismissal remedy."
