Aitken v Virgin Australia Airlines and Vandeven v Virgin Australia Airlines (No.2)

In *Aitken v Virgin Australia Airlines and Vandeven v Virgin Australia Airlines (No.2)*, the Federal Court of Australia considered penalties to be imposed on Virgin Australia Airlines for contraventions of the *Fair Work Act 2009* (Cth) and the costs consequences arising from the rejection of settlement offers. The proceedings concerned alleged breaches of the National Employment Standards, specifically regarding the termination of employment and the provision of notice.

The primary legal issues before the Court were the appropriate quantum of penalties for the contraventions and whether the respondents should be ordered to pay the applicants' costs, notwithstanding the applicants' success in establishing liability. This latter issue turned on whether the applicants' refusal of certain settlement offers made by Virgin Australia, which were designated as *Calderbank* offers, was unreasonable in the circumstances.

Judge Burnett determined that while Virgin Australia had contravened the Act, the penalties should be moderated due to factors including the company's cooperation with the investigation, the absence of prior similar contraventions, and the fact that the contraventions were not driven by senior management. The Court also found that the *Calderbank* offers made by Virgin Australia were not unreasonable in their terms, and therefore, the applicants' refusal to accept them warranted an order that the applicants pay the respondents' costs incurred from the date of the offers.

Consequently, the Court ordered Virgin Australia to pay penalties totalling $10,000 for the contraventions. In relation to costs, the applicants were ordered to pay the respondents' costs from the date of the first *Calderbank* offer, with those costs to be assessed on an indemnity basis.