Lepore and Secretary, Department of Employment

This matter concerned an application for an advance under the Fair Entitlements Guarantee Act 2012 (FEG Act) by an employee whose employer, UFCO Pty Ltd, became insolvent. The applicant sought payment for long service leave entitlements accrued during his employment with UFCO and its predecessor, Universal Forme Pty Ltd. The Secretary of the Department of Employment had previously determined that the applicant was not eligible for an advance, a decision the applicant sought to have reviewed by the Tribunal.

The central legal issues before the Tribunal were whether the applicant's long service leave entitlements, accrued with Universal Forme and subsequently with UFCO, had effectively transferred to Entegro Group Pty Ltd, the entity that acquired the business, and consequently, whether the applicant was entitled to an advance under the FEG Act. The Tribunal was required to consider the operation of the Long Service Leave Act 1992 (Vic) and the terms of the sale of business contract in determining the locus of responsibility for these entitlements.

The Tribunal reasoned that the sale of business contract, while requiring UFCO to assume responsibility for "Employee Liabilities" including long service leave, did not effect a transfer of the applicant's entitlements accrued with Universal Forme to UFCO. It found that these entitlements remained with Universal Forme. However, the Tribunal determined that long service leave entitlements accrued during the applicant's employment with UFCO did transfer to Entegro. As a result, the Tribunal concluded that the applicant was not entitled to an advance under section 14 of the FEG Act, as the liability for the accrued long service leave had not fallen to the insolvent employer, UFCO, in a manner that would trigger FEG Act assistance. The Tribunal affirmed the delegate's decision.