Employee fined for not giving notice of resignation

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Employee fined for not giving notice of resignation

The Federal Circuit Court has enforced an award clause against an employee who resigned without providing the prescribed notice, fining him $2550.

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The Federal Circuit Court has enforced an award clause against an employee who resigned without providing the prescribed notice.

[Full text of this case: Jetgo Australia Holdings Pty Ltd v Gl (No.2) [2015] FCCA 1911 (3 July 2015)]

Judge Vasta awarded the penalty of $2550 to the Commonwealth, not the employer.

Employers sometimes seek remedies against employees who resign without providing notice. There are limited avenues available, but this case demonstrates a possible deterrent available through court action.

Background


The employee resigned without providing any notice to the employer. The court was of the view the employee was oblivious to the requirements under the award that he was required to give two weeks’ notice and, in fact, believed he had to give eight weeks’ notice.

The court concluded that two weeks’ notice was the extent of the breach. It noted: “When one looks at what has happened, it has been more than inconvenient for the applicant that the respondent left his position when he did and as he did, given he had just completed training in the United States".

Penalty imposed


When looking at common factors relevant to the imposition of a penalty the case of Mason v Harrington Corporation Propriety Limited (2007) FMCA 7  was noted – referring to the following factors:

  • the nature and extent of the conduct which led to the breaches
  • the circumstances in which the conduct took place
  • the nature and extent of any loss of damage sustained as a result of the breaches
  • whether there had been similar previous conduct by the respondent
  • whether the breaches were properly distinct or arose out of the one course of conduct
  • the size of the business enterprise involved
  • whether or not the breaches were deliberate
  • whether senior management was involved in the breaches
  • whether the party committing the breach had exhibited contrition
  • whether the party committing the breach had taken corrective action
  • whether the party committing the breach had cooperated with enforcement authorities
  • the need to ensure compliance with minimum standards by provision of an effective means for investigation and enforcement of employee entitlements, and
  • the need for specific and general deterrence.

Was breach deliberate?


A significant factor was whether the breaches were deliberate. The  court commented:

“As I found, they were most certainly deliberate, though at that stage, I do not think that the espondent [employee] believed he was breaching the FW Act. I am of the view that he believed he was breaching the contract which allowed for eight weeks’ notice rather than the two weeks’ notice. I need to look at whether there is the need for specific and general deterrence.”

The maximum penalty for this conduct is 60 penalty units (which currently equates to $10,200). The court determined the employee's conduct as an individual was worthy of 25 per cent of the maximum – a total of $2550.

Payment to Commonwealth


The Act talks about the pecuniary penalty needing to be paid to the Commonwealth or a particular organisation. The court concluded the penalties imposed be paid to the State in this case.

The legislation allowed otherwise “but, in my view, such should be the exception rather than the rule. Prosecutions for breaches should not be seen as another method by which aggrieved applicants can be compensated. Persons should pursue breaches of the FW Act, not because it may enrich them but because it is the right thing to do in a fair and just society.”

There was no order in relation to costs.

The bottom line: Employees are subject to penalties for award breaches – as are employers. However, there is little satisfaction for an employer in a case like this as the penalty was awarded to the Commonwealth.

Jetgo Australia Holdings Pty Ltd v Goodsall (No 2) [2015] FCCA 1911

See also: Notice of termination — common issues for employers

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