Worker wins compensation, unfair dismissal claim
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An employee has won over $10,000 in compensation following his resignation, after five months of being paid just $5,000.
The Fair Work Commission has awarded compensation to an employee who resigned after not being paid his wage and superannuation entitlements for five months.
Although the company did not expressly terminate his employment, the commission ruled that it had dismissed him by repudiating the contract by its failure to pay wage entitlements.
Richard Chan was employed as a management accountant at Dilato Investments from late 2013 until his employment ended in early 2026.
Dilato is an investment company for a family office and had only two employees at the time.
Under his contract, Chan was entitled to $10,416.66 per month plus superannuation. Chan told the commission that he had experienced late payments until September 2025, when he stopped receiving wages apart from a $5,000 partial payment on 31 December 2025.
The commission also found that he had not been paid superannuation since April 2025.
Repudiation
While still employed, Chan pursued his employer for unpaid wages and superannuation.
Chan emailed his employer an ultimatum: “If full payment is not made by close of business on 6 February 2026 at 5:00PM, I will have no option but to treat these ongoing breaches of my employment contract as a repudiation of the agreement.”
Upon the demand not being met, Chan considered the failure to pay as Dilato’s repudiation of his employment and ceased working following this email.
“He says that had he not accepted the repudiation of his contract with immediate effect, he would probably have just given notice of his resignation, because the situation of not being paid is not something he could live with,” the commission said in its decision.
A contract can be repudiated when an employer is in serious breach of the contract of employment – where the employee can choose to terminate the employment by resigning, the commission noted.
“An election to resign in response to a repudiation is properly regarded as a termination at the initiative of the employer … in the sense that it is the employer’s conduct which is the principal contributing factor in bringing about the end of the employment relationship, being conduct that had the probable effect of doing so,” it said.
Thus, the commissioner was satisfied that Chan had been terminated at the initiative of Dilato by way of repudiation.
“There is no doubt that the Applicant was dismissed,” it said.
Upon consideration of all evidence, the commissioner found that Chan had attempted to obtain alternative employment following the end of his employment, finding that the remuneration lost is the equivalent of four weeks at his pay rate, being $10,416.66.
“The Applicant had been both persistent and patient in seeking the recovery of his unpaid wages, and perhaps some of his losses may have been avoided if the Respondent had acted to bring the matter to a head at an earlier stage,” the commissioner said.
“I am satisfied in the present matter that the dismissal of the Applicant was harsh and unreasonable. The Applicant was a long-serving employee who was entirely blameless in the circumstances that led to his dismissal. The employer was derelict in its obligations to pay the Applicant for his services for four months yet continued to benefit from his services.”
The case citation: Mr Richard Chan v Dilato Investments Pty Ltd Atf Plan B Trust [2026] FWC 3448 (11 September 2026).
RELATED TERMS
Compensation is a term used to describe a monetary payment made to a person in return for their services. Employees get pay in their places of employment. It includes income or earnings, commision, as well as any bonuses or benefits that are connected to the particular employee's employment.
When a company terminates an employee's job for improper or illegitimate reasons, it is known as an unfair dismissal.
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