Just because a Deed of Release was not signed did not mean it was not a binding agreement, according to a recent Fair Work Australia full bench appeal decision.
An employee of Darwin City Council lost her job after being diagnosed with epilepsy, and restricted from performing fundamental requirements of her job. Her union advised her the best result it could gain was an amicable separation, not reinstatement. In evidence to FWA the union official maintained the employee had agreed to this course. A draft Deed of Release reflecting this was drawn up but never signed by the parties.
On appeal, the employee argued that she had never given such instructions and she had not signed the Deed. Therefore there was no agreement to the course of action which the union advised.
FWA disagreed, indicating the union official was highly experienced. The evidence supported the official’s version of events. Importantly, FWA said the Deed did not need to be signed to be in force. It was clearly the intention of the parties to act in the manner the Deed outlined. There was no provision in the Deed requiring signatures to bring it into force.
The lesson for employers in this case is twofold; just because a document isn’t signed does not necessarily mean it can’t be enforced; and, if the intention is to make a document enforceable only after is has been signed, then the document should clearly and forcefully state that.