Getting into a relationship at work with a colleague can be more trouble than its worth, especially when personal issues start intruding into the workplace, or when the personal relationship breaks down. Managing the blowout by an employer needs to be handled sensibly, professionally and objectively to ensure productive relationships continue for all involved.

A disastrous example of a personal and employment relationship breakdown can be found in Ray v Priority ERP Pty Ltd [2020].

The Facts

Mr Unsworth was the director of Priority ERP and Ms Ray was an employee of the business for approximately 15 months. Mr Unsworth and Ms Ray were in an intimate relationship for seven years.

In March 2020, the COVID pandemic hit Australia, and all states and territories started the process of closing borders, with the Governments implementing lock downs and restrictions to stop the spread of COVID 19.

On a Sunday night in late March, Ms Ray was upset with Mr Unsworth because he had spent the weekend with another woman. Mr Unsworth was upset with Ms Ray’s reaction to his ‘weekend activities’ and the impending closure of his business due to COVID 19.

In a ‘WhatsApp’ chat that Mr Unsworth had with his 4 employees, he communicated the possible standing down of employees. In response, Ms Ray posted in the WhatsApp group chat that she would not bother coming into work the next day. This angered Mr Unsworth, and after a heated exchange of messages in the WhatsApp group which culminated in a resignation and termination, both the personal and employment relationship came to an end.

Mr Unsworth’s final words resulted in him telling Ms Ray to take the matter to court if she didn’t like the decision, to which she indulged by lodging an unfair dismissal application.

The Fair Work Commission found that Ms Ray was summarily dismissed at the initiative of the employer. Some of the reasons for the dismissal included (from the message exchange on WhatsApp):

• disrespecting Mr Unsworth in the group WhatsApp chat;
• refusing to apologise for the WhatsApp chat post;
• not attending work on the following day; and,
• asking for a contract for work as ‘blackmail’.

The Outcome

Despite Ms Ray giving back as good as she got from Mr Unsworth, the Commission concluded that her conduct was a reasonable response to the ‘appalling conduct’ of Mr Unsworth. The above reasons used to justify the termination weren’t consistent with the Small Business Fair Dismissal Code, nor was Ms Ray afforded procedural fairness to the extent that she did not get an opportunity to respond and there were no prior warnings. Accordingly, it was an unfair dismissal.

However, the Commission did not award any compensation because of the poor financial viability of the business in light of the COVID 19 pandemic and because Ms Ray was employed as a Teacher and still had an income.

Key Lessons

The moral of the story is that what an employee does outside of work should not be of any concern in the workplace. However, a close personal relationship with a colleague at work can be a challenge, especially when that personal relationship sours.

It is recommended that businesses have appropriate policies and procedures in place (for example, a Relationships at Work policy, disclosure forms) to manage these relationships and set expectations between the parties. Like with any workplace issue, employers must still have a valid reason to take action against an employee and procedural fairness must still be observed. If these two key ingredients do not exist, the business can be exposed to legal claims.

If you have any questions about any of the items discussed in this blog, please do not hesitate to contact a member of Coleman Greig’s Employment Law Team, who would be more than happy to assist you today.