Does employment start when a contract is signed?

One Minute Summary

The employee resigned from their current job once the parties had signed the employment contract with her new employer.
The contract provided a future start date approximately 4 weeks later.
Before commencement of employment the new employer withdrew the employment contract.
The employee filed a General Protections application citing termination of employment based on the contract being in place.
The Fair Work Commission stated no termination had taken place because the contract had not yet commenced.

On 31 October 2025 the employee, Ms Perri, signed a contract of employment with Oral Health Victoria (OHV). The contract stated employment would commence on 1 December 2025. The employment was subject to successful pre-employment screening which included Police checks, immunisation, reference checks and a work rights check.

On 3 November 2025 Ms Perri resigned from her then current employer relying on her new employment contract with OHV.

On 27 November 2025 she received a welcome email from the OHV Operations Manager which confirmed her start on Monday 1 December 2025. It also provided detailed onboarding information, hospital tour, rostered shifts. The email ended with “looking forward to you starting on Monday”.

However, Ms Perri didn’t start Monday.

On 28 November OHV advised Ms Perri the employment offer had been withdrawn following due diligence. No details were provided.

Ms Perri lodged a Fair Work General Protections application involving dismissal of employment.

The question is whether an employment relationship existed at the time it was withdrawn on 28 November.

In examining the matter Deputy President O’Neill acknowledged the above facts and added that:

Ms Perri had not performed any work for OHV nor had she attended any training, meetings or onboarding steps at that time.
The employment commencement date of 1 December, as stipulated in her contract, had not been reached.

Ms Perri submitted an employment relationship existed from the date the employment contract was signed on 31 October 2025 – not on 1 December when work was to commence.

The Deputy President disagreed stating: ‘During the period after an employment contract is executed to commence work at a later date and the start of work, the ordinary position is there is an employment contract but no employment relationship in place’

The Deputy President further explained that if the employment commences from the date the contract is signed the employee’s period of service and employment entitlements would commence before service is performed. Secondly, it cannot be the intention that new employment rights are established while existing rights were still current from the previous employer – during the notice period.

The Deputy President stated that on 28 November 2025 there was a contract for future employment but there was no relationship of employment. Therefore, the applicant had not been dismissed on 28 November 2025 and no General Protections involving dismissal could apply. The matter was dismissed.

The Deputy President stated that S346 of the Fair Work Act (General Protections not involving dismissal) could apply in respect to a prospective employer who refuses to employ a prospective employee for proscribed reasons.

Casual Employment

While not immediately relevant to this case the Deputy President briefly explored the above question in relation to casual employment: ‘Does the employment commence once on the books, or only when an employee accepts an offer of to work a particular shift, or only when work is performed? There is no single correct answer in all contexts.’ The DP stated it would be necessary to examine the particular contract terms and all surrounding circumstances.

Commentary

On the surface the matter appears quite unfair to the employee given they had resigned from their previous employment and were not left without any work after the new contract was withdrawn. However, the interpretation of the law in such matters doesn’t take that into account.

If the applicant had attended for meetings, on boarding with OHV the decision may have been different. At the time the employment contract was withdrawn no such actions had taken place.

While outside the jurisdiction of the Fair Work Commission there is a possible argument at common law that the contract should have been fulfilled once signed by both parties. Such action would more likely occur with senior employees on more substantial remuneration packages as common law actions tend to be more costly.

It is recommended that employers review their employment contracts to ensure clarity of the starting date of the contract. Additionally, consideration should be given to any actions taken by the employer and prospective employee prior to the commencement date of the contract which could trigger an earlier date.

With no clarity on casual contracts, it may be useful to insert a contract clause stating when the parties recognise that a contract officially starts.

Employers looking to review their employment contracts should contact Hunter Employee Relations. We have developed comprehensive employment contract templates which are a cost-effective option where employers need to upgrade their employment contracts.

Kind Regards

Michael Schmidt

M 0438 129 728

[email protected]

www.hunteremployeerelations.com.au