The case of Bowden v KSMC Holdings Pty Ltd t/as Hubba Bubba Childcare on Haig & Chapman  NSWDC 98 is a cautionary tale for employees that demonstrates that employers need to exercise care and discretion when communicating to others the reason when an employee’s employment came to an end.
The case involved a part time staff member of a child care centre who resigned from his employment as it was not fitting in with his child care studies. During the notice period the employer then elected to bring the employment to an end.
Following his resignation the employer sent the following email to 35 parents whose children attended the child care centre.
“[Matt] is unfortunately no longer with us due to disciplinary reasons. Whilst being good with the children in general, Matt was not truthful with us regarding his studies and some other issues, and I felt it was better for him to move on and possibly gain a bit more life experience. We wish him well with his future.”
The employee commenced a proceeding in defamation. He claimed the statements in the email meant that he was dishonest. The employer pleaded the defence of qualified privilege. The defence was not upheld as:
- the clients have an interest in knowing the employee left, but not the reasons for termination;
- the content of the email was not reasonable given the evidence, that the employee had initiated the termination by tendering his resignation
- the employer acted maliciously as they did not give the employee a chance to comment on the email before it was sent.
The Court found that the comments were defamatory and awarded the employee $237,970 in damages with costs. (This is likely to exceed $400,000). A salutary lesson for the employer.