Failure to comply with National Employment Standards – Employer and HR manager fined

11 December 2015 Topics: Workplace relations and safety

In the recent matter of Cerin v ACI Operations Pty Ltd & Ors [2015] FCCA 2762, the Federal Circuit Court ordered the employer and its HR manager to pay a penalty to the employee for failing to give him adequate notice of termination, therefore breaching s 44 and s 117 of the Fair Work Act 2009.

The employee, who was on workers’ compensation, was given 28 days’ notice of termination of employment and the employer argued that this complied with s 58B of the Workers Rehabilitation and Compensation Act 1986 (SA).

However, the Court found that this was in breach of s 44 of the Fair Work Act, which required the employer to comply with the National Employment Standards (NES) and give the employee five weeks’ notice. The employee was therefore entitled to a further two days’ notice and suffered a loss of $181.66 as a result of the breach.

The Court found that the employer’s conduct in terminating the employee’s employment without proper notice or payment in lieu was bizarre since no satisfactory excuse was given for not complying with the Fair Work Act. Further, the HR manager admitted that she was aware of the NES under the Fair Work Act and its requirements as to the amount of notice to be given on termination depending upon length of service of the employee.

Based on her evidence, the Court found that the HR manager was involved in the contravention of the NES due to the accessorial liability provision in the Fair Work Act, although her conduct was found to be significantly less serious than that of the employer.
The employer argued that the failure to provide the correct amount of notice was procedural and not a deliberate failure. However, the Court found that there was no excuse for the employer to ignore their obligations under the Fair Work Act and came to the conclusion that the actions of the employer and the HR manager were deliberate.

In an attempt to reflect the seriousness of such breaches, the Court imposed substantial penalties on the employer and the HR manager. The maximum penalty for a corporation at the relevant time was $51,000 and $10,200 for an individual. The Court ordered the employer to pay $20,400 and the HR manager $1,020 to the employee.

This article originally appeared in Cooper Grace Ward’s Workplace Relations & Safety Risk Management Adviser – December 2015. Click here to download the full newsletter.



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