Callous transfer directive backfires on childcare employer

17 August 2020

A childcare worker has been reinstated to her former role after the Fair Work Commission (FWC) found that she was forced to resign due to her employer’s unreasonable relocation directive.

This matter involved an unfair dismissal application made by Ms Penelope Phair (Ms Phair) pursuant to s 394 of the Fair Work Act 2009 (the Act) against the respondent employer Active Kids Pre School Centre of Excellence (Active Kids).

The background

March 2014 – January 2019

During the first period of employment, Ms Phair was stationed at Active Kid’s childcare centre as ECT in Vaucluse, Sydney. In 2016, Active Kids advised her that she would be required to transfer to another centre located at World Square, Sydney CBD. Ms Phair objected to this and following opposition by parents, Active Kids decided not to proceed with the relocation.

April 2019 – 30 December 2019

In late 2018, due to dropping enrolment numbers at Vaucluse, Ms Phair was advised that Active Kids was unable to continue her employment. Ms Phair then left Active Kids in January 2019 when she secured a new job with childcare operator Good Start.

Ms Phair enquired about an opening for a role at Active Kids’ Bondi centre. As a result, Ms Phair was re-employed with Active Kids on a part-time basis in April 2019. She had left Good Start because she was required to change nappies rather than perform teaching.

Events leading up to the resignation

On the morning of 19 December 2019, Active Kids gave Ms Phair one weeks’ notice of her relocation to Narwee (25 kilometres away). The relocation directions was given because the person who previously occupied Ms Phair’s current position had returned.

  • Ms Phair was informed that her work would be
  • confined to younger children between ages 0 to 3 years;
  • involved nappy changing; and
  • her working hours would be altered and reduced.

Ms Phair was extremely upset with this news and expressed her discontent to Active Kids. Active Kids then sent Ms Phair an email which formally notified her of the transfer to Narwee and required her to sign an acceptance. A time limit was imposed on the response, otherwise the agreement would be deemed unaccepted.

On 30 December 2019, Ms Phair’s solicitors asserted that by giving her the transfer directive it had breached the consultation and part-time employment provisions of the Award, and further the transfer directive was asserted to be in breach of the employment contract. The solicitors also gave notice of Ms Phair’s resignation saying:

“Our client hereby gives notice of her resignation but this termination of employment as a result of Active Kid’s conduct is deemed to be at the initiative of Active Kids and is a constructive dismissal.”


  1. Were Active Kids entitled to relocate Ms Phair?
  2. Was the relocation directive reasonable?
  3. Was this a case of constructive dismissal?

The decision

While accepting that employers were ordinarily entitled to transfer employees, the FWC asserted that Active Kids strayed far from the usual circumstances contemplated:

"The transfer directive was neither reasonable nor lawful because it ... altered the [worker's] ordinary hours of work contrary to the stated terms in the contract of employment document."

The relocation directive was held to be unreasonable because:

  • it was issued without any consultation whatsoever;
  • it involved the applicant being transferred to work at a different location;
  • with reduced ordinary hours of work;
  • increased span of daily hours; and
  • it involved performance of duties that the employer knew the applicant disliked.

Relevantly, the transfer directive was issued as a non-negotiable fait accompli, and on any reasonable expectation, it would be unacceptable to the applicant.

The FWC ruled that constructive dismissal had occurred pursuant to ss 386 (1) (b) of the Act which establishes that if an employee is forced to resign because of conduct engaged in by the employer then the resignation is held to be a dismissal.

The conduct of Active Kids’s approach to informing Ms Phair of the transfer directive, was held to be conduct that intended to produce, or was likely to result in, the resignation of the applicant. As such, dismissal had taken place. Further,

“there was no identifiable reason for the dismissal of the applicant. Consequently, the applicant [Ms Phair] was dismissed without valid reason related to her capacity or conduct.”

Implications for you

This case serves as a reminder that the decision to relocate an employee should be considered meticulously alongside their employment contract and the day to day terms of their engagement.

Although an employer may have the ability to transfer workers, care should be taken to follow all the correct procedures, especially consulting with the individual as the FWC may reverse this if it finds that directions were unreasonable or unfair.

This aritle was authored by Simon Black, Laura Sowden and Theresa Au.

Penelope Mary Kathleen Phair v Active Kids Pre School Centre of Excellence Pty Ltd [2020] FWC 4034

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