Willis v Health Communications Network Ltd

The appeal concerned a dispute between an employee, Mr Willis, and his former employer, Health Communications Network Ltd (HCN). Mr Willis had accepted employment as Chief Financial Officer in December 1999, with his terms and conditions of employment detailed in a letter dated 6 December 1999 and a separate document titled 'Terms and Conditions of Employment'. Subsequent variation letters were issued, including one dated 26 November 2002 which extended the notice period for termination to six months and allowed HCN to pay in lieu of notice. A further variation letter dated 11 January 2005 outlined a "total remuneration" package, specifying a base salary and a superannuation component. Mr Willis's employment was terminated, and he instituted proceedings in the District Court of New South Wales, claiming redundancy benefits and superannuation contributions. The primary judge rejected both claims, and Mr Willis appealed to the Court of Appeal.

The Court of Appeal was required to determine two principal legal issues. Firstly, whether an unpublished redundancy policy was impliedly incorporated into Mr Willis's contract of employment, either by law or by custom, such that he was entitled to benefits under it. Secondly, the court had to consider whether the payment in lieu of notice made by HCN to Mr Willis should have included superannuation contributions that would otherwise have been due during the notice period. The court also had to consider whether supplementary submissions filed after the hearing, without leave, could be taken into account.

The court's reasoning addressed the redundancy claim by affirming the primary judge's finding that Mr Willis was dismissed for misconduct, rather than made redundant. The court accepted the evidence that the employer's decision to terminate Mr Willis's employment was based on a belief that he was not fulfilling his duties, and that his position was not abolished. Regarding the superannuation issue, the court agreed with the primary judge that a payment in lieu of notice did not constitute "salary or wages" for the purposes of the Superannuation Guarantee (Administration) Act 1992, and therefore did not attract a compulsory employer superannuation contribution.

The Court of Appeal directed the parties to file written submissions within 14 days on the costs of the appeal, the costs of litigating the superannuation issue in the District Court, and whether any such costs should be paid on an indemnity basis.