Loss of Trust and Confidence: Why it’s not enough to dismiss you

Being told by your employer that they’ve "lost trust and confidence" in you can feel like the end of the road. Many employees think they have no choice but to accept it — that trust, once broken, can’t be repaired.

But under Australian workplace law, it’s not enough for an employer to simply claim a loss of trust to justify a dismissal. The law requires more than feelings or suspicions. It demands evidence. It demands fair process. Without those, a dismissal may be found to be unfair, unjust, and unreasonable.

Loss of Trust Must Be Proven

Employers can’t just assert that the employment relationship is damaged. To lawfully dismiss someone for loss of trust and confidence, they must:

• Substantiate the alleged conduct or behaviour that caused the loss of trust

• Provide proper reasoning and evidence that supports the decision

• Follow a fair process, including giving the employee an opportunity to respond

It’s not enough to say, “We no longer trust you.” They must be able to show why—and that the reasons are solid, factual, and justified.

Simply put: loss of trust must be based on real evidence, not gut feelings.

This principle was reinforced clearly in a recent Fair Work Commission case.

Case Study: Mammarella v Department of Parliamentary Services [2019]

In this case, Mr Mammarella worked as an Electoral Officer for the Victorian Department of Parliamentary Services. His job involved managing assets and representing a Member of Parliament in the local community.

When allegations of fraudulent conduct emerged in the office, an independent anti-corruption body began an investigation. Although no findings had been made, and no internal disciplinary process had been completed, Mr Mammarella was charged with criminal offences connected to the investigation.

The Department dismissed him, stating that they had lost trust and confidence in his ability to perform his role.

But the Fair Work Commission disagreed.

The Commission found that while concerns may have existed, there was no substantiated evidence proving that Mammarella had engaged in wrongdoing. Importantly:

• No criminal findings had been made at the time of dismissal

• No independent findings within the Department’s own processes had been reached

• No evidence was presented that directly linked Mammarella to misconduct

The Commission ruled that it was not sufficient to rely solely on a perceived loss of trust without proper justification. As a result, his dismissal was found to be unfair and unjust.

Why This Matters to Employees

It’s critical for employees to understand that employers must back up serious allegations with evidence. A vague claim of mistrust is not enough to lawfully end your employment.

You have legal rights, including:

• The right to know the reasons for any proposed dismissal

• The right to respond to allegations made against you

• The right to a fair, unbiased process

If these rights are not respected, you may have strong grounds to challenge your dismissal through the Fair Work Commission.

What to Do If Your Employer Claims a Loss of Trust

If you’re told there’s been a loss of trust and confidence in you:

• Ask for specific reasons. What is the basis for the alleged loss of trust?

• Request evidence. Feelings and suspicions are not enough; there must be facts.

• Seek advice quickly. Time limits apply to unfair dismissal claims, so early action is critical.

If you’ve been dismissed because of a supposed loss of trust, get in touch. You may have a strong claim — and a second chance.