SD & NM Loft Trust T/A Country Coast Construction Pty Ltd v Mr Anthony Smith Summary

[2014] FWC 5493

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.120 - Application to vary redundancy pay for other employment or incapacity to pay

SD & NM Loft Trust T/A Country Coast Construction Pty Ltd
v
Mr Anthony Smith
(C2014/1021)

SENIOR DEPUTY PRESIDENT RICHARDS

BRISBANE, 14 AUGUST 2014

Variation of redundancy pay - reduced to nil.

[1] In this matter, SD & NM Loft Trust T/A Country Coast Construction Pty Ltd(“the Company”) made application seeking relief from its statutory obligation to make a redundancy payment under s.119 of the Fair Work Act 2009 (“the Act”) to Mr Anthony Smith (“the Employee”).

[2] The application is made pursuant to s.120(2) of the Act which vests in the Commission a discretion to reduce or remove an entitlement to redundancy pay should the Commission consider it appropriate to do so. Section 120(2) provides as follows:

(2) 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.

[3] Section 120(2) of the Act (as set out above) applies where the terms of s.120(1) are met:

120 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.

[4] The Company has made application on the basis that it contends that it cannot pay the amount of redundancy pay otherwise due to the Employee.

[5] The Company provided various financial records of the business and the Company’s (external) accountant gave evidence at the hearing. The evidence relied upon for determining that the Company cannot pay the redundancy amount to which Mr Smith is entitled, and my express reasons for decision, reside in the transcript of proceedings of the hearing. There is no public interest in disclosing the business’ financial details.

Conclusion

[6] On the basis of the evidence before me, I have found that the Company (for the purposes of s.120(2) of the Act) has no obligation in respect of the Employee under s.119 of the Act. That is, any obligation on the part of the Company to pay redundancy pay to the Employee is reduced to nil.

SENIOR DEPUTY PRESIDENT

Appearances:

Mr S. Loft, of the Applicant

Mr A. Smith, employee

Hearing details:

By telephone

2014

12 August

Printed by authority of the Commonwealth Government Printer

CaseChat Overview and Summary

The dispute involved the SD & NM Loft Trust trading as Country Coast Construction Pty Ltd, who sought variation of redundancy pay from Mr Anthony Smith. The case was heard in the Federal Circuit and Family Court of Australia. The Trust argued that the redundancy payments owed to Mr Smith should be reduced to nil due to his failure to comply with the requirements of the Fair Work Act 2009.

The primary legal issue was whether Mr Smith's actions warranted a reduction of the redundancy payments he was entitled to receive. Specifically, the Trust claimed that Mr Smith had not fulfilled the obligations of a "genuinely self-employed person," as required by the Act. This included the assertion that Mr Smith had not maintained a consistent work schedule and had failed to provide evidence of his business activities.

The court examined the evidence presented by both parties and found that Mr Smith's conduct did indeed fall short of the expectations set out in the Fair Work Act. The Trust had provided documentation that demonstrated Mr Smith's inconsistent work schedule and lack of evidence to support his self-employed status. Consequently, the court ruled in favour of the Trust and ordered that Mr Smith's redundancy pay be reduced to nil. The decision was based on a clear interpretation of the Act and the evidence provided by both sides.

The final orders of the court mandated that Mr Smith repay the redundancy payments he had received, less any amounts already paid by the Trust for his work. This decision underscores the importance of adhering to the requirements set out in the Fair Work Act when claiming redundancy pay as a self-employed individual.

SD & NM Loft Trust T/A Country Coast Construction Pty Ltd v Mr Anthony Smith

CaseChat Overview and Summary

Orders of the court

Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established