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Author: PWLadmin

  • High Income Threshold Rises to $133,000

    High Income Threshold Rises to $133,000

    The Fair Work Commission has increased the High Income Threshold to $133,000 effective 1 July 2014.

    The high income threshold affects how modern awards apply to employees and affects their ability to access unfair dismissal.

    The high income threshold affects 3 main entitlements:

    1. Employees who earn more than the high income threshold and who are not covered by a modern award or enterprise agreement, cannot make an unfair dismissal claim;
    2. Employees who are covered by a modern award and have agreed to a written guarantee of annual earnings that is more than the high income threshold, do not get modern award entitlements. However, they can make an unfair dismissal claim.
    3. The maximum amount of compensation payable for unfair dismissal is capped at either half the high income threshold, or 6 months of the dismissed employee’s wage – whichever is less.

    What’s counted under the high income threshold?

    An employee is affected by this if their ‘earnings’ are more than the high income threshold. To calculate ‘earnings’, include:

    • Wages
    • Money that is paid on their behalf (e.g. superannuation top-ups or salary sacrifice)
    • The agreed value of non-monetary benefits (e.g. laptops and mobile phones).

    An employee’s earnings do not include:

    • Payments that cannot be set in advance (e.g. commissions, bonuses or overtime)
    • Reimbursements
    • Superannuation contributions that the employer has to make.

    Lessons for employers

    The increase will enable more employees to access the unfair dismissal provisions. Employers should remain mindful that employees who cannot access the unfair dismissal provisions of the Fair Work Act may still have other legal options to challenge a dismissal. These other avenues include the general protections provisions of the Fair Work Act, anti-discrimination laws, and the common law for breach of contract claims.

  • Court frowns on rewarding workers with Coke and pizza – and issues penalties

    Court frowns on rewarding workers with Coke and pizza – and issues penalties

    Paying with pizza and Coke
    Paying with pizza and Coke

    Giving teenage employees free and discounted pizzas and soft drink instead of wages has been frowned on by the Federal Circuit Court as a practice belonging “in the dark ages rather than twenty first century Australia,” and has cost a pizza franchise, La Porchetta, operator $335,000 in fines; Fair Work Ombudsman v Bound for Glory Enterprises Pty Ltd & Anor [2014] FCCA 432 (6 June 2014), and Fair Work Ombudsman v Zillion Zenith International Pty Ltd & Anor [2014] FCCA 433 (6 June 2014).

    Federal Circuit Court Judge John O’Sullivan found Mr. Ruby Chand, owner of two (2) companies that operated La Porchetta pizza and pasta restaurant franchises in outer eastern Melbourne, guilty of underpaying more than 100 young employees a total of $258,000 between 2009 and 2012.

    His Honour said, “on any description of the conduct involved here the nature and extent of it warrants severe sanction by way of penalty…Where the conduct involved represents such a fundamental breach of the safety net payments that are at the heart of the objects of the Fair Work Act and where the [companies] are still operating, any penalty arrived at must send a clear and unambiguous message to the [companies] by way of penalty to deter the possibility they will repeat the breaches.” 

    After a Fair Work Ombudsman investigation, the two (2) companies admitted to:

    • failing to pay correct minimum pay rates;
    • failing to pay casual loadings;
    • failing to accrue annual or personal leave; 
    • failing to pay outstanding annual leave entitlements on termination; and 
    • failing to keep accurate records.

    Judge O’Sullivan said he was particularly concerned that the two (2) companies claimed more than $45,000 from the Federal Government for employing trainees who were then not given the minimum number of hours required by the traineeship contracts.

    Judge O’Sullivan said that investigations in 2007, 2008 and 2009 had also found problems with unpaid wages and entitlements and that Mr. Chand had been warned that he had to meet legal requirements.

    The employees affected by the contraventions were mostly teenage part-time and casual cooks, kitchen attendants and waiting staff, with underpayments ranging from $3 to $25,358.

    Judge O’Sullivan fined the two (2) companies $139,507.50 each, and Mr. Chand a further $56,000 personally.

    His Honour also ordered that $80,000 in outstanding entitlements be repaid to employees who had not been fully reimbursed.

     

  • General Protection Claim – Myer proves dismissal NOT linked to workplace right or to gender

    General Protection Claim – Myer proves dismissal NOT linked to workplace right or to gender

    General Protection Claim
    Sales Manager Dismissed

    In the decision of Vukovic v Myer Pty Ltd [2014] FCCA 985 (2 June 2014), a Myer sales manager, Vukovic, who did not disclose he had an anxiety condition to his employer, or make any plan to seek workers compensation, has failed to argue that these were the real reasons for his dismissal, rather than concerns with his performance.

    The sales manager, Vukovic, was employed at the North Ryde Myer’s store from April to June 2013.  Vulovic was advised that he was being dismissed within his three (3)- month probationary period because of his apparent disengagement at several internal staff events, unsatisfactory customer performance, and his failure to take notes and follow up concerns raised during regular inspections of his departments.

    Vukovic, however, alleged that Myer dismissed him because of ongoing panic attacks he had been experiencing at work, the physical symptoms of which, he believed, would have been apparent to his managers and colleagues.

    Vukovic argued in the Federal Circuit Court that, because his anxiety condition qualified as a disability and would have meant he had a workplace right to seek compensation, Myer had taken adverse action against him when it sacked him.

    Judge Cameron dismissed Vukovic’s General Protections claim, finding that Myer management had been able to show that the concerns which led to Vukovic’s dismissal related to “performance of his duties and were quite unrelated to any workers compensation rights he might have had“.

    Judge Cameron said that the script that his store manager read from when notifying Vukovic of his dismissal “recorded the bases” for the dismissal and that none of the issues raised reflected a concern that he suffered from an anxiety condition, which Vukovic conceded he had not disclosed.

    In addition, Judge Cameron found there was no evidence that Vukovic intended to pursue a workers compensation claim.

    His Honour also rejected a further allegation that Vukovic had been dismissed because he was male, and accepted Myer’s evidence that while some female employees had complained that he had been looking at their breasts, his explanation that he was checking their name tags to make sure he got the right names was “accepted as an adequate explanation and the issue did not arise again”.

    LESSONS FOR EMPLOYERS?

    It is apparent that an employee can raise virtually any issue of concern that has some loose and indirect connection with their employment, and rely on that as a workplace right in an adverse action claim under Part 3-1 the Fair Work Act.

    However, this does not mean that an employer cannot appropriately and fairly manage employees’ performance and conduct and make decisions to discipline or dismiss, when such complaints have arisen.

    The critical issue for an employer is being able to explain, justify and defend the decision making process through clear evidence.

    The employer should consider these issues:

    • What “paper trail” will exist about the reasons of the relevant decision makers, leading up to any decision to dismiss or discipline?
    • Are complaints properly investigated?
    • Who within the business will be involved in any decision?
    • Who makes the final decision?
    • Will they be available to give evidence?

  • Fair Work Act’s General Protections provisions covered a WIDE range of employment complaints

    Workplace Update – Fair Work Act’s General Protections provisions covered a WIDE range of employment complaints

    General ProtectionIn May, the Federal Court ruled that the Fair Work Act’s general protections provisions covered a wide range of employment complaints.

    However, it found that these were not the reason for a client services manager’s dismissal in the case at hand, Walsh v Greater Metropolitan Cemetries Trust (No 2) [2014] FCA 456 (9 May 2014).

    Justice Bromberg dismissed the client manager’s (“Walsh”) adverse action claim against the Greater Metropolitan Cemeteries Trust (“GMCT”), finding that she had been dismissed for poor performance and not because she made complaints about a linen supplier and its links to one of the trust’s employees.

    GMCT, which operates 19 cemeteries across metropolitan Melbourne, engaged Walsh on a three (3)-year contract on 24 September 2012, but stipulated that her employment was subject to a six (6)-month probation period.

    GMCT dismissed Walsh on 20 March 2013, four (4) days prior to the expiration of her probation period.

    Walsh told the Court she had made four (4) complaints to her Director on 7 March 2013, and repeated them in a meeting with GMCT’s Chief Executive five (5) days later.

    The complaints related to:

    • the shortage of GMCT staff at a Greek Orthodox memorial service, leading to workplace safety concerns and the unlawful consumption of alcohol by some of the attendees;
    • linen supplier, Alsco, providing sub-quality service;
    • Alsco’s employment of her Director’s Executive Assistant’s daughter, and probity issues arising from the Assistant dealing with her daughter in relation to the contract; and
    • the Executive Assistant undermining Walsh in discussions with other employees.

    GMCT argued to the Court that the complaint about the probity of the Alsco contract did not relate to Walsh’s employment under section 341(1)(c)(ii).

    Justice Bromberg said that the words “in relation to” in the section 341(1)(c)(ii) were of “wide import“, and the relationship could be direct or indirect.

    Relying on the Court’s CFMEU v Pilbara Iron decision, his Honour said the nexus would likely be satisfied “where the subject matter of the complaint raises an issue with potential implications for the complainant’s employment”.  His Honour said Walsh had raised a probity issue in relation to a contract with a supplier who provided services to an operation which she managed in the course of her employment, and Walsh’s “failure to report suspected wrong-doing had the potential to reflect badly upon her and cause prejudice to her in her employment“.

    His Honour said, “By reason of either of those two factors, the Alsco contract complaint made [by Walsh] raised an issue with potential implications for [her] employment and was ‘in relation to…her employment’ within the meaning of s 341(c)(ii) of the FW Act”.

    Justice Bromberg accepted evidence from GMCT’s Chief Executive, however, that the complaints had nothing to do with her decision to dismiss Walsh.  The Chief Executive told the Court that she had decided to dismiss Walsh after having discussions with the Director and GMCT’s HR Manager, and set up a meeting on 12 March 2013 with her to communicate her decision.

    When Walsh made the complaints at the meeting, the Chief Executive adjourned the meeting to investigate Walsh’s complaints, but ultimately concluded that they were without substance.

    The Chief Executive said that nothing Walsh had raised in the 12 March meeting concerned her enough to change her view that her employment should be ended, and that the reasons were that she was not a “good cultural fit for the organisation“, was not focused on the strategic aspects of her job, and had become involved in too many conflicts with other employees.

    LESSONS FOR EMPLOYERS?

    It is apparent that an employee can raise virtually any issue of concern that has some loose and indirect connection with their employment, and rely on that as a workplace right in an adverse action claim under Part 3-1 the Fair Work Act.

    However, this does not mean that an employer cannot appropriately and fairly manage employees’ performance and conduct and make decisions to discipline or dismiss, when such complaints have arisen.

    The critical issue for an employer is being able to explain, justify and defend the decision making process through clear evidence.

    The employer should consider these issues:

    • What “paper trail” will exist about the reasons of the relevant decision makers, leading up to any decision to dismiss or discipline?
    • Are complaints properly investigated?
    • Who within the business will be involved in any decision?
    • Who makes the final decision?
    • Will they be available to give evidence?

    Does the employer want the most senior people in the business to be directly involved in any decision making process?  If they are involved, given the nature of the evidentiary burden on the employer, their evidence will be needed. Does the business want its CEO or Managing Director to be in the witness box? If not, then query whether they should be directly involved in any decision making process, and consider delegating the authority to make such decisions to others such as the Human Resources department and direct managers.

  • Federal Court Decision on Labour Hire Sham Contracting Arrangement – Avoiding Employer Obligations

    Farm Workers
    Farm Workers not contractors

    The Federal Court has found that shifting seasonal workers to a new employer after they had worked 40 hours a week constituted a “sham” contracting arrangement with the purpose of avoiding paying overtime.

    Her Honour, Justice Collier held that a Queensland fruit farm owned by a family trust was in fact the employer of the workers for the entire period, rather than the two (2) labour hire companies that appeared on the workers’ payslips after they had completed their ordinary hours.

    Eastern Colour Pty Ltd ran the family trust, with the parents of the farming family its sole directors and shareholders.

    The sole director and shareholder of each of the two (2) additional companies; SB Employments and NB Employments, were the sons.

    Eastern Colour Pty Ltd gave evidence that it was not economically viable to pay overtime, and that after seeking advice, it set up “internal” labour hire arrangements.

    Justice Collier accepted evidence from Eastern Colour Pty Ltd that there were low profit margins in the industry, that the major supermarkets set the price for the farm’s produce, and that many of those performing seasonal work wanted as many hours as possible.  However, her Honour stated, “these facts do not detract from the legal position under the Act, which this Court is required to apply”.

    The Office of the Fair Work Ombudsman (’the FWO’) launched the prosecution on behalf of four (4) former casual workers after it investigated their complaints from 2008.  The FWO found that Eastern Colour Pty Ltd was the “true employer.”

    Justice Collier agreed with this finding and noted:

    • The workers considered that it was the sons’ parents who were “the bosses,” and who could hire and fire, and “this did actually appear to be a correct perception“;
    • The workers believed they were working for Eastern Colour Pty Ltd.  Those working on the farm wore shirts bearing the name Eastern Colour, while the only applicable WHS guidelines were in the name of Eastern Colour;
    • The workers performed the work on a farm owned by Eastern Colour Pty Ltd by packing fruit in boxes labelled as “produced by Eastern Colour“;
    • The workers had limited knowledge of SB Employments or NB Employments other than as entities whose name appeared on their pay slips;
    • There was no practical difference in the workers’ work environment or practice after an employee had worked 40 hours;
    • The workers were not aware that they worked up to 40 hours for one company and any additional hours for another, despite the parents’ evidence that they informed them of the arrangement;
    • The sons had no involvement in employing staff;
    • The “clear fact that SB and NB existed only to provide services to [Eastern Colour]“; and
    • Apart from time sheets and pay slips, the “absence of any contract of employment between either SB or NB, and the relevant employees“.

    Justice Collier noted that Eastern Colour Pty Ltd repeatedly gave evidence that no farms paid overtime rates to their harvesting and packing staff.

    Justice Collier further noted that while “this may have been the practice, it is very clear that [the company] was aware of the legal obligation on employers to pay overtime once an employee had worked 40 hours. Indeed, it was for this very reason that SB and NB were created – namely to be entities who could be the nominal employers of employees on the farm to obviate the legal requirements of Eastern Colour as employer to pay overtime for more than 40 hours work… That the directors of SB and NB were the children of [the parents] simply supports the inference that SB and NB functioned in the context of the family business.”

    Her Honour found that it was clear that all three (3) companies “aided and abetted the contravention, and/or were knowingly concerned in the contravention“, which was underpaying the workers (under the former Workplace Relations Act 1996).

    Justice Collier asked the parties to make submissions on the FWO’s call for penalties.

    [Fair Work Ombudsman -v– Eastern Colour Pty Ltd (No 2) [2014] FCA 55 (11 February 2014)]

    Employer’s Lesson:

    It is apparent that creating a labour hire arrangement to avoid paying employee entitlements is no protection from a prosecution of ‘sham’ contracting, despite what the industry standard or practice may be.

    I hear companies say to me, ‘but I know that other companies are doing this’…. That maybe so, however, as Justice Collier has stated clearly in this decision:

    “these facts do not detract from the legal position under the Act, which this Court is required to apply”.

    As always, please do not hesitate to contact me to discuss.

  • Anti Bullying Provisions

    From 1 January 2014, amendments were made to the Fair Work Act 2009 which allow a worker, who believes that they have been bullied at work, to apply to the FWC for an Order to Stop the Bullying.

    This provision is not limited to employees, but extends to:

    –                contractors,

    –                labour hire personnel and

    –                persons engaged under other workplace arrangements.

    The FWC is required to commence dealing with an Application for an Order to Stop Bullying within 14 days of an Application being made.

    The FWC may make any orders it considers appropriate to stop the bullying, other than an order for the payment of a pecuniary penalty.

    Before making an order, the FWC must be satisfied that the worker would continue to be bullied.

    If the bully breaches the FWC Orders, it may lead to penalties of up to $10,200 for an individual, or $51,000 for a corporation. 

  • Changes to Queensland Workers Compensation Legislation – What this means for you!

    Following the release in May 2013 of the report of the Inquiry into the Operation of Queensland’s Workers’ Compensation Scheme, the Workers Compensation Rehabilitation & Other Legislation Amendment Bill 2013 was passed on 17 October 2013.

    Significant changes were made to the Queensland Workers’ Compensation and Rehabilitation Act 2003 (‘the Act‘).  The Act was assented to on 29 October 2013, and the changes are now in effect.

    Workers-Compensation-Claims-in-LouisianaThe purpose of the changes was to “strike a better balance between providing appropriate benefits for injured workers and ensuring the costs incurred by employers are reasonable“. Whether that goal will be achieved and whether the number of claims will decrease, is yet to be seen.

    Regardless, it is critical that employers remain vigilant with the workers’ compensation process and understand their rights and obligations to deal with the changes, and to defend against claims.

    The Queensland scheme

    • The laws aim to ensure Queensland maintains the leading workers’ compensation scheme in Australia.
    • Queensland is the only state where ALL workers are covered during their journey to and from work.
    • The changes are to ensure that the premiums paid by businesses will be the lowest in Australia.
    • Queensland has the lowest common law threshold of any state in Australia (for example – Queensland’s starting threshold is greater than 5%, while Victoria’s is 30%. South Australia, the Northern Territory and the ACT have abolished workers’ rights to make common law claims).

    The key changes include:

    • Replacing Q-Comp with the “Workers Compensation Regulator” and merging it into the Office of Fair and Safe Work Queensland.  The explanatory notes regarding the change identify that the Workers Compensation Regulator will operate in a similar manner to the regulator under the Work Health & Safety Act 2011.
    • Allowing employers to seek disclosures from prospective workers about previous injuries/conditions and obtain their workers compensation claims history.
    • To make a common law claim a worker must now have a 5% Degree of Permanent Impairment (‘DPI‘) arising from the injury, which replaces the concept of whole person impairment.
    • The table of injuries has been removed from the Workers Compensation and Rehabilitation Regulation 2003 and replaced with a new calculation for lump sum compensation under the relevant DPI.
    • The definition of “injury” under section 32 of the Act, has been amended.

    Who can make a common law claim for work related injuries?

    The Act now contains a threshold the worker must meet so to make a common law personal injury claim in relation to a work related injury sustained on or after 15 October 2013.

    The concept of “work related impairment” has been replaced with a method of assessment of “degree of permanent impairment” (‘DPI‘).

    Workers are now only able to file a common law damages claim for a work related injury where a worker’s DPI is assessed as being greater than 5% or, who have a terminal condition.  Dependents retain their ability to seek damages if the work related injury resulted in the worker’s death.

    [Workers who sustain an injury prior to 15 October 2013 will have their workers compensation claims processed and dealt with under the old provisions of the Act.]

    What is an “injury”?

    The definition of “injury” in relation to physical injuries remains unchanged.  For physical injuries, employment still needs to be “a significant contributing factor” to the injury.

    However, the definition of “injury” in relation to psychiatric or psychological injuries has changed to require that employment be “the major significant contributing factor to the injury”.  This change will represent a higher threshold to be met by claimants seeking compensation for psychological injuries.

    The exemption of psychiatric/psychological injuries arising from reasonable management action taken reasonably in relation to the worker’s employment remains unchanged.

    Workers also remain able to make journey claims (injuries that occur during certain journeys).

    Employers to Seek Disclosures to History

    From 29 October 2013, prospective workers, upon receiving a written request by a prospective employer, are required to disclose all pre-existing injuries of which they are aware could reasonably be aggravated by performing the duties of the position they applied for.

    A prospective employer must advise the prospective worker:

    (a) Of the nature of the duties the subject of the position he prospective worker has applied for; and

    (b) that if they do not comply with the request, or they supply false or misleading information, the worker will not be entitled to compensation or damages under the Act for any event that aggravates the non-disclosed pre-existing injury.

    Where the prospective worker fails to disclose relevant pre-existing injuries or provides false or misleading information and aggravates the non-disclosed pre-existing injury, the worker will lose their entitlement to compensation and damages.

    For employees who were engaged before being requested to make the disclosure, their ability to make claims for pre-existing/non-disclosed injuries remain unchanged.

    Furthermore, with the consent of the worker, and payment of a fee to the Regulator, a prospective employer is now able to access a prospective worker’s claims history summary. The amended Act provides that the prospective employer must maintain confidentiality of the summary and not disclose the contents.  The summary may only be utilised with respect to considering and selecting the prospective worker for employment.

    However, the prohibition in the Act on obtaining and using “workers’ compensation documents” (as defined in the Act) for selecting a person for employment or determining whether a workers’ employment is to continue, still exists.  The application of the Fair Work Act 2009, and discrimination laws, also continue to apply.  Hence, access to information about a prospective worker’s workers compensation history and pre-existing conditions will need to be carefully managed and considered in order to ensure legal compliance.

    Now What?

    Employers need to understand the implications of the recent amendments of the Act, in order to defend against workers’ compensation claims.

    While significant changes have been made, key processes and obligations under the Act remain unchanged, including, employers having 8 business days to provide a response to a workers compensation claim to the insurer.

    Employers should ensure that policies and procedures:

    (a) maintain reasonable management action;

    (b) meet work, health and safety requirements, to minimise injuries;

    (c) address access to medical and workers compensation documents and use of those documents.

  • Recent Case in Federal Circuit Court Confirms Calculation of Reasonable Notice where no Written Contract

    Miller v Sunland Park Pty Ltd [2014] FCCA 89 (31 January 2014) 

    The Federal Circuit Court has awarded a general manager six (6) months’ pay upon finding no justification for his summary dismissal over personal spending on his company credit card. 

    Sunland Park Pty Ltd (the Company) engaged the general manager on an oral contract with the Company’s owner.  The oral contract did not specify the notice to be given by either party to end the employment. 

    After 13 months of service, the owner dismissed the general manager, accusing him of unauthorised spending while on an overseas trip on behalf of the Company. 

    Justice Simpson found there was no basis for the summary dismissal.   His Honour preferred the general manager’s evidence that the owner had instructed him to utilise the Company credit card for personal items whilst travelling in Europe and in North America, and to reimburse the Company upon his return. 

    His Honour said that as the employment contract had not been reduced to writing, its terms were to be found in conversations between the parties leading up to the general manager’s engagement as well as, “those terms that are to be implied as a matter of law“. 

    His Honour said the general manager was entitled to damages that may be quantified “by determining the length of time that would be needed were the [Company] to have given [the general manager] reasonable notice of termination“. 

    The general manager proposed that 12 months notice would be reasonable notice, however, the judge found that 6 months would be reasonable notice, taking into account factors including:

    • The general manager’s $60,000 salary,
    • Length of service with the Company,
    • Age,
    • Seniority in the Company,
    • Duties, and
    • The likelihood of him finding suitable employment elsewhere. 

    His Honour supported the general proposition that, “The general rule is that the longer the employee has worked for the employer and the more senior and important the position they occupy, the longer their entitlement… Senior managers can generally expect at least 6 months’ notice even when they have been in their job for only a short period of time.” 

    ImageJustice Simpson also observed that the Company had unlawfully suspended the general manager for one week without pay, the week prior to terminating his employment: “It is not permissible at common law for an employer to suspend an employee without pay even in circumstances where it is thought that the employee has breached his or her contract of employment in some way.  If an employer suspends, it must be on the basis that the employee continues to be paid their full entitlements”. 

    Justice Simpson awarded the general manager $35,808 in damages, which included unpaid salary, annual leave and superannuation, as well as the 6 months’ notice. 

    Use of Company credit card for personal items reasonable

    Justice Simpson provided that the general manager’s use of the Company credit card for all expenditure, personal and business, while on the overseas trip accorded with some “common sense“, particularly because the Company was claiming some of the expenses from Austrade. 

    Furthermore, he found that it would have been difficult for the general manager to determine whether a particular expense transaction was claimable as a business expense or a private expense. 

    His Honour stated, “Far better to have all business and all private transactions made with the use of the one card and to then determine, on return to Australia, which items should be considered private (and therefore refundable to the Company) and which items business and therefore claimable in the submission to Austrade.” 

    His Honour said that it did not accord with common sense that the general manager was using the credit card dishonestly as he knew that “very soon afterwards [the Company owner] would be able to see the entries on the Mastercard statement“. 

    Summary Dismissal
    His Honour found that if the owner believed the general manager was acting unlawfully, it was up to him to terminate his employment “as soon as he held that belief…An employer exercising the power to summarily dismiss must act without undue delay. Undue delay may result in the employer waiving the employee’s breach of the employment contract.” 

    Finally, Judge Simpson said the owner’s action in encouraging the general manager “to go on a lengthy and expensive overseas trip after he had only been with the company for eight months is hard to understand.  A more cautious approach was called for.” 

  • Implied mutual term of trust and confidence – Commonwealth Bank v Barker

    There is now an implied mutual term of trust and confidence in about 9 million Australian employment contracts, according to Victorian barrister, Mark Irving, who appeared for the ACTU in the Federal Court case that confirmed the term’s existence. 

    In a paper on the Commonwealth Bank v Barker decision, Mark Irving presented to a seminar hosted by the Australian Institute of Employment Rights and the Australian Labour Law Association in Melbourne last week, Irving said that because the trust and confidence term was implied by law, not fact, it was incorporated into all contracts of employment. 

    A term implied “in fact” had to satisfy the five tests in the High Court’s BP Westernport decision, which included that it was needed to give business efficacy to the contract, he said. 

    Irving said that a term that the parties not do anything to destroy mutual trust and confidence in an employment relationship would not pass that test, because contracts of employment could work without it. 

    Instead, the majority judges in Barker had for the first time confirmed the existence of the term in Australia’s common law, although Irving noted that the Bank had sought leave to appeal the decision in the High Court.  Irving said the implied term had been part of UK law since at least 1998, when the House of Lords ruled in Malik v BCCI. 

    Irving said the Barker majority judges had pointed to 11 Australian appellate court decisions in which the issue had previously been considered but not unequivocally determined. 

    He said the Court’s acceptance of the term was part of the necessary development of the common law.  “The common law is more than a system of static rules. It is the story of a nation. And the story never ends. The common law develops as public policy changes; and as our prejudices (read preferences and predispositions) evolve, and as the experience of modern life changes,” he said. 

  • Superannuation and Termination Payments in NSW

    Superannuation Guarantee contributions are payable on the payment in lieu of notice amount, and is directed into the employee’s superannuation fund.

    Superannuation is not paid in relation to the following termination payments:

    • accrued annual leave, 
    • redundancy pay,
    • other payments made on termination of employment.