Key Takeaways
- Where a contract is formed matters as much as where an employee lives. If your employment agreement was received in Australia, the Fair Work Act may apply.
- A performance warning needs to actually warn. If an employee’s job is on the line, communicate that clearly in writing and keep that paper trail.
- A termination clause in an employee agreement doesn’t override due process. Employees must be given ample opportunities to respond before any decision is made.
- A bad dismissal can impact your finances and brand reputation. Partnering with an established outsourcing provider means that employment obligations are managed on your behalf, avoiding a similar Fair Work Commission case.
A ruling by the Fair Work Commission reminds Australian employers that offshore workers may still have access to remedies under the Fair Work Act of 2009.
In David Sanderson v Brightest Australia Pty. Ltd. [2026] FWC 1633, a New Zealand-based sales employee was let go by his employer via text message. He wasn’t given a formal warning, nor was he invited to a meeting where he could have responded to concerns. The FWC found the dismissal “harsh, unjust, or unreasonable,” and ordered the employer to pay the equivalent of two weeks’ gross pay in compensation.
This case comes a little over a year after the FWC upheld its decision in the landmark Pascua case, which was used here as a precedent to determine whether unfair dismissal applies.
Case Background
David Sanderson started working as a “Project Consultant” for app development company Brightest Australia on 16 September 2024.
The role required Sanderson to sell a “minimum of 5 Flexi Plans a month” to customers in New Zealand, where he resides. He’d join weekly sales meetings with two other sales employees located in Australia and the VP Project Consulting.
On 22 July 2025, Sanderson received two emails from the VP with the subject line “Performance Warning.”
On 8 December 2025, he received a text message indicating that his employment had been terminated. An email then followed, stating the decision was “due to the performance not meeting the standards and expectations required for [the] role.”
Over the duration of his employment, Sanderson made 32 sales against his total obligation of 75. Of those 32, a number didn’t lead to any payment, even after he introduced a procedure to obtain payments from new customers within 24 hours of a sale.
Sanderson lodged a Fair Work Commission unfair dismissal application.
On 6 May 2026, the Commission deemed Sanderson eligible for remedy, finding that he falls within the primary definition of “Australian-based employee.” The ruling also determined that Brightest had failed to comply with the Small Business Fair Dismissal Code and must pay Sanderson NZD 2,884.83 as compensation by 19 May 2026.
The Written Decision and Its Implications
Hiring remote workers directly is hardly new. Many businesses across different industries are already doing it, or thinking seriously about it, to address local talent shortages. But Sanderson shows how easy it can be to overlook relevant compliance obligations.
Whether you’re in accounting, healthcare, or property development, the arrangement and risks are the same. Your firm is just as susceptible. We’ve outlined the factors that led to the FWC ruling.
On Whether Unfair Dismissal Applies
In determining if Part 3-2 (Unfair Dismissal) of the Fair Work Act applies to Sanderson’s case, Deputy President Kamal Farouque cited Doessel Group Pty. Ltd. v Joanna Pascua [2025] FWCFB 43. In particular, the observation that:
“Part 3-2 is extended to operate with respect to any Australian-based employee in relation to the employee’s Australian employer without territorial limitation.”
The Fair Work Commission then considered whether both parties met the relevant definitions. Brightest was clearly an “Australian employer.” And while Sanderson was based in New Zealand, he qualified as an “Australian-based employee” because Brightest had offered him a role and an Employment Agreement by way of email, which he accepted. Sanderson returned a signed copy on 10 September 2024, confirmed as received by Brightest that same day.
Under the Electronic Transactions Act 2000, “the place of receipt of a document is the place where the contract is.” In this case, the signed Employee Agreement was received by Brightest in Victoria, Australia, meaning the agreement was formed there for legal purposes. Sanderson’s physical location was therefore not determinative of his employment standing.
So, if you’re a firm owner hiring remote or offshore workers, you must give equal consideration to where the employment relationship is formed, not just where that employee lives.
Related Reading: Avoiding Another Unfair Dismissal Case: Lessons from Pascua
On Performance Warnings That Don’t Warn
Brightest submitted the two July emails as evidence that Sanderson had been notified of his role being at risk. However, the emails didn’t explicitly indicate the possibility of termination due to poor performance. “The content of the email is more in the nature of an exhortation to improve,” noted the Deputy President.
Brightest also failed to substantiate claims that verbal warnings had been given. Sanderson himself denied receiving any.
The company pointed to clause 24 of Sanderson’s contract, which allowed for termination on one week’s notice if he failed to meet sales targets. But as a small business employer (fewer than 15 staff), Brightest was required to give Sanderson an opportunity to respond to warnings against him and to rectify concerns. In its decision, the Fair Work Commission found no satisfactory proof for either.
The manner of dismissal—by text—also compounded the procedural failure. It bypassed any meaningful process entirely.
On the Harsh, Unjust, or Unreasonable Dismissal
Sanderson claimed that his failure to meet targets was due to the company’s marketing efforts generating “inadequate or insufficient leads.” Indeed, weekly meetings with the marketing team were held from February to April 2025 but ceased when the assigned manager stopped attending. The ruling also noted that Sanderson’s Australian peers performed just as poorly.
The Fair Work Commission acknowledged that Brightest faced legitimate commercial concerns, including weak sales and the product’s apparent lack of viability in New Zealand. But because the company failed to comply with the Small Business Fair Dismissal Code, the dismissal was deemed harsh regardless.
Compensation was set at two weeks’ gross pay, corresponding to how long the FWC assessed Sanderson’s employment would have lasted had the dismissal not happened.
What This Fair Work Commission Case Means for You
It wasn’t too long ago that the Pascua case drove Australian firms and businesses to review their outsourcing arrangements. Sanderson suggests that the message has not yet fully landed.
Working through the fine print of every employment obligation is time-consuming, especially if you run a small firm. But that due diligence should be the default when you’re hiring remote or offshore workers directly. Otherwise, the compliance risk can follow you straight to the Fair Work Commission.
Notably, the FWC itself drew a direct line between under-resourcing HR and ending up with an unfair dismissal issue:
“It is apparent that the respondent lacks any dedicated human resource management specialist or expertise which likely negatively impact it on its ability to meet procedures to affect the dismissal.”
If you want to avoid that exposure, consider partnering with an established outsourcing provider. As the legal employer of your outsourced staff, the provider takes on all employment obligations. They also have dedicated HR and legal teams whose job is to prepare and execute contracts that don’t contradict themselves.
The Ultimate Guide to Outsourcing
Then there’s brand reputation. Even if two weeks of compensation were something your firm could manage, you’d still be publicly linked to substandard employment practices.
FWC decisions are published—company names and all—and they get shared. On LinkedIn and Facebook groups frequented by candidates and potential clients. The blast radius can be wider than anticipated. And as more accounting and finance firms engage offshore talent, they’ll be paying closer attention to how peers handle it.
The Bottom Line: Process is Protection
Sanderson was a combination of procedural missteps, which could have been prevented if caught earlier. Regardless of firm size, it’s always worth investing in HR expertise when outsourcing. Because regulations will only become more complicated to deal with as you also manage workload, client demands, and onshore teams.
Beyond being an HR function, good procedures are business insurance. Be sure to work with an outsourced talent provider that treats them accordingly.
Get Outsourcing Right with TOA Global
As a registered company in the Philippines, TOA Global’s 4,200+ outsourced accounting professionals spread across five office locations are full-time employees covered by the country’s workplace laws.
When you partner with us, you get Australian-trained talent, we take care of compliance. Interested?
