Jordavaire Pty Ltd T/A Creative Productions Australia Pty Ltd

[2020] FWC 5572

[2020] FWC 5572

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.120—Redundancy pay

Jordavaire Pty Ltd T/A Creative Productions Australia Pty Ltd
(C2020/3161)

COMMISSIONER SIMPSON BRISBANE, 26 OCTOBER 2020

Variation of redundancy pay.

[1] Jordavaire Pty Ltd T/A Creative Productions Australia Pty Ltd (the Applicant)has made an application pursuant to s.120(1)(b)(ii) and sought a determination under s.120(2) of the Fair Work Act 2009 (the Act) to have the Commission reduce the redundancy entitlement of Mr Lenny Ramp, a former employee of the Applicant, on the basis that the Applicant cannot pay the amount due.

Legislation

[2] Section 119 of the Act provides as follows:

“119 Redundancy pay

Entitlement to redundancy pay

(1) An employee is entitled to be paid redundancy pay by the employer if the employee’s employment is terminated:

(a) at the employer’s initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or

(b) because of the insolvency or bankruptcy of the employer.

Note: Sections 121, 122 and 123 describe situations in which the employee does not have this entitlement.

Amount of redundancy pay

(2) The amount of the redundancy pay equals the total amount payable to the employee for the redundancy pay period worked out using the following table at the employee’s base rate of pay for his or her ordinary hours of work:

Redundancy pay period
Employee’s period of continuous service with the employer on termination	Redundancy pay period
1	At least 1 year but less than 2 years	4 weeks
2	At least 2 years but less than 3 years	6 weeks
3	At least 3 years but less than 4 years	7 weeks
4	At least 4 years but less than 5 years	8 weeks
5	At least 5 years but less than 6 years	10 weeks
6	At least 6 years but less than 7 years	11 weeks
7	At least 7 years but less than 8 years	13 weeks
8	At least 8 years but less than 9 years	14 weeks
9	At least 9 years but less than 10 years	16 weeks
10	At least 10 years	12 weeks

[3] Section 120 of the Act further provides:

“Variation of Redundancy Pay for Other Employment or Incapacity to Pay

(1) This section applies if:

(a) an employee is entitled to be paid an amount of redundancy pay by the employer because of section 119; and

(b) the employer:

(i) obtains other acceptable employment for the employee; or

(ii) cannot pay the amount.

(3) On application by the employer, the FWC may determine that the amount of redundancy pay is reduced to a specified amount (which may be nil) that the FWC considers appropriate.”

[4] The matter was allocated to me and listed for Conference by telephone on 14 May 2020. At this Conference, the parties reached an agreement. On 4 June 2020, a Deed of Release and Settlement executed by both parties was provided to my chambers. The Respondent to the application consents to the application and does not seek to be heard on it.

[5] On 11 June 2020, the Applicant provided a revised letter of redundancy that read as follows:

“I am recinding (sic) the redundancy as per the letter issued in May 2020. As agreed in conference with Commissioner Simpson from fair work commission, we are making your position redundant as of the 9th of August 2020 and as such we have extended the period of notice until that time and reduce the redundancy payment to nil. The period of notice will comprise of 5 weeks at full pay and accruing entitlements, followed by the remaining weeks using the Job Keeper Payment of $750/week.

At the conclusion of your employment, being the 9th of August 2020, you will be paid any entitlements to you.”

[6] On 27 July 2020, I listed the matter for a further Mention and directed the Applicant to provide submissions regarding its financial position.

[7] On 14 September 2020 my chambers contacted the Applicant to follow up on whether it intended to file submissions as directed. The Applicant advised it intended to file submissions as soon as possible.

[8] On 1 October 2020, my chambers received an email from the Applicant providing the submissions as requested as to why the Applicant cannot pay the amount.

[9] When taking all of the criteria and agreement of the parties into account, in accordance with s.120(1)(b)(ii) and (3), and for the reasons set out above, the redundancy payment of eight (8) weeks is reduced to nil.

[10] I Order accordingly.

COMMISSIONER

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