ATO Tip-Off Leads to Dismissal: Fair Work Commission Finds Dismissal Unfair
Mr Jian Zhang worked at the same restaurant for six years. In February 2025, after receiving a letter from the ATO identifying a discrepancy in his reported income, he discovered he had likely been underpaid. He raised this with his employer. Less than two weeks later, he was dismissed without notice or explanation.
The Fair Work Commission found the dismissal was unfair. The employer initially claimed protection under the Small Business Fair Dismissal Code but failed to engage in the process or provide evidence. As a result, the Commission proceeded without their input.
The Commission accepted Mr Zhang’s evidence and concluded there was no valid reason for his dismissal. He had not been given notice, a chance to respond, or any proper process. The timing of the dismissal shortly after Mr Zhang raised concerns about underpayment suggested a retaliatory motive. His replacement had already been hired when he returned to request paperwork and entitlements.
The Commission rejected the employer’s vague claims of misconduct and determined the dismissal was harsh, unjust and unreasonable. Compensation was awarded.
This case reinforces several key points for employees:
Raising concerns about pay can lead to adverse treatment, but legal protections exist.
Small businesses are still required to follow basic fairness in dismissals, especially when relying on the Fair Dismissal Code.
The Fair Work Commission can proceed even if the employer fails to participate.
A dismissal made shortly after an employee raises a workplace concern may be treated as retaliatory if no proper reason is shown.
Mr Zhang’s case is a reminder that process matters—and failing to follow it can render a dismissal legally unfair and reinforces that where an employee raises concerns about wages or entitlements, any subsequent dismissal will be closely scrutinised. If the employer cannot show a clear, valid reason and fair process, the Commission may infer a retaliatory motive.
