Employee fails in bid for costs over redundancy payout

Cases

Employee fails in bid for costs over redundancy payout

An employee has failed in an attempt to be awarded costs when his employer abandoned an FWA claim that it was not liable for a redundancy payout because it had found him other work.

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An employee has failed in an attempt to be awarded costs when his employer abandoned an FWA claim that it was not liable for a redundancy payout because it had found him other work.
 
 
The employer then paid him out, but the employee claimed it had cost him more than $1200 to dispute the employer’s claim.
 
Senior Deputy President Anne Harrison said Delando Corporation had sought not to pay the redundancy because it had found the worker, S, alternative work.

Reduced hours
 
However, the alternative work was at reduced hours and S had not accepted it.
 
He then hired Keystone Lawyers to represent him in opposing Delando’s claim that it did not owe him the redundancy payment.
 
However, the matter was settled between the parties and S was paid seven weeks of redundancy.
 
Delando then discontinued the matter, but S said he had not consented to the discontinuation and would apply for costs.
 
In his claim for costs, S’s lawyer submitted:
  • S incurred the cost of obtaining legal advice and his legal representative appeared before Fair Work Australia on two occasions, together with daily advice and correspondence with Delando.
  • S incurred $1200 plus GST in legal costs. S would also be liable for preparation of these submissions. The likely amount of legal costs would excede $1200 plus GST, but S was simply seeking $1200 plus GST from Delando.
  • Since there was no agreement for settlement, yet a voluntary payment by Delando of S’s full redundancy entitlements, S had been put to the expense of defending legal proceedings which were clearly commenced vexatiously or without reasonable cause [and which had no reasonable prospect of success].
  • Accordingly, S was applying under cl611 of the Fair Work Act 2009 for Delando to pay S’s costs incurred in the proceedings.

However, DP Harrison ruled against S, saying the claim that Delando had no reasonable prospect of success was not sustainable.

She said the outcome of arbitration on the matter ‘is by no means certain’.

DP Harrison said Delando had an arguable case, and the reasons for the withdrawal of the case ‘may be many and varied’.

‘The costs incurred by S were of his own volition,’ she said.
 
‘The application for costs is refused and the matter concluded.’
 
 
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