The Fair Work Commission has reinforced an important principle for employers: conduct that is embarrassing, frustrating or commercially uncomfortable does not necessarily amount to a valid reason for dismissal.

In James (Gemma) Moore v Bytewize Pty Ltd, the Commission found that an employee was unfairly dismissed after sending a resignation email to her employer which also copied in various Department of Education personnel connected with the employer’s client services. In the email, the employee stated that she had spent “yet another month with no money” and that the role had become unsustainable for her mental and physical health.

The following day, the employer accused the employee of attempting to “defame” the business, described the conduct as “completely unacceptable” and directed her to immediately return company assets, keys and passwords. The employer argued that the employee had breached contractual obligations by communicating directly with clients without approval.
While the Commission accepted that the email had the potential to embarrass the employer, affect its commercial interests and was circulated more broadly than necessary, it concluded that the conduct did not amount to a valid reason for dismissal under section 387(a) of the Fair Work Act 2009 (Cth).

Importantly, the Commission distinguished between conduct that an employer may legitimately dislike and conduct sufficiently serious to justify termination. While the employer may have preferred to control communications with clients itself, the employee’s actions did not rise to the level of misconduct warranting dismissal.
The Commission also rejected the employer’s reliance on a broad contractual clause restricting communications relating to the services being performed. It considered that, if interpreted literally, the clause would be excessively broad and declined to accept that every communication required prior written approval.

The dismissal was further undermined by procedural fairness deficiencies. Although the employer attempted to telephone the employee before sending its response, the Commission found there was no meaningful opportunity for the employee to respond before the termination decision was made.

What employers can learn from this decision
• Not every reputational or commercially uncomfortable issue will justify dismissal.
• Even where a policy or contractual term is breached, the Commission will assess whether dismissal was a proportionate response.
• Procedural fairness remains critical, particularly in emotionally charged situations.

Before dismissing an employee, employers should ordinarily:
• clearly identify the alleged misconduct;
• notify the employee of the concerns;
• provide an opportunity to respond; and
• genuinely consider alternatives to dismissal.

The decision is a reminder that reputational embarrassment and valid misconduct are not always the same thing. Employers should exercise caution before treating emotionally charged or commercially uncomfortable communications as grounds for termination.

If you would like to discuss this or other workplace issues, please contact Andrew Bland or call 02 9412 3077