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Repudiation: employee’s position advertised behind her back

Vabec v Fourth Marsupial [1995] IRCA 530

The facts:

Mrs. Vabec, an experienced chef and caterer of fifteen years standing, had been employed at Southgate’s River Walk Café as head chef for eight months. Worried about the restaurant’s high turnover of casual staff, in late April 2005 she made her concerns known to her employer, Mr. Fourniotis. In the weeks following this conversation their employment relationship – which had until then been very good – soured.

In early May, Mrs. Vabec opened a copy of the Saturday Age newspaper, finding – to her distress – an advertisement for her position as full-time chef, with Mr. Fourniotis’ phone number listed as the contact. On 8 May Mrs. Vabec confronted Mr. Fourniotis at work over the advertisement, engaging in a “clearly unorchestrated litany of bad language”, hurling abuse, smashing a plate and refusing to hand back her keys to the shop at security’s request.

What the court decided:

The issue was whether Mrs. Vabec resigned or whether she could consider herself terminated. While Mrs. Vabec’s outburst would no doubt have provided grounds for dismissal, Judicial Registrar Fleming found that Mr. Fourniotis had repudiated her employment contract the moment he placed the job advertisement. Mrs. Vabec had accepted the repudiation and was in the circumstances entitled to compensation for unfair dismissal.

Gavel and block beside the scales of justice

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Notable quotes from the judgment:

“While [counsel for Fourth Marsupial] submitted that the placement of the advertisement was an invitation to treat, I am not persuaded by the submission.”

“While Mrs. Vabec’s conduct on the 8 May was inappropriate, in all the circumstances it was understandable that she was angry and upset. Mrs. Vabec was terminated at the initiative of her employer.”

Take-away message:

This case can be taken to illustrate how the courts might view an employer’s decision to covertly advertise an executive’s position. Placement of such an advertisement may well be considered a repudiation of the contract of employment, allowing the executive to terminate the contract and sue for damages at common law.

As a decision of the now defunct Industrial Relations Court, Vabec v Fourth Marsupial is binding on courts of lower status than the Federal Court, and would be persuasive, though not binding authority, for a Federal Judge.

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