Compo for reduced work hours after parental leave

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Compo for reduced work hours after parental leave

An employee returning from parental leave was given only casual work, then part-time work and was then made redundant. His termination pay was wrongly calculated according to the part-time rate he was being paid at the time of the redundancy.

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An employee returning from parental leave was given only casual work, then part-time work and was then made redundant. His termination pay was wrongly calculated according to the part-time rate he was being paid at the time of the redundancy.

The employer was ordered to pay the difference between the actual pay and what the employee’s full-time pay would have been.

[Full text of this case: S v Coffey Projects (Australia) Pty Ltd [2015] FCCA 1514 (4 June 2015)]

Employer suffered downturn after the GFC


A man employed full-time as a project manager took paid parental leave from 2 to 6 May 2011 to help his wife care for their newborn twins. He also took long service leave at half pay from 9 May to 4 November 2011, annual leave from 5 to 30 November 2011, and then further parental leave without pay from 1 December 2011 to 30 April 2012.

The employer suffered a downturn during and after the GFC and staff numbers had been reduced during 2011 and 2012. When the project manager returned from his leave, he was first given only casual work, and then from September 2012 offered part-time work – 18.5 hours per week instead of 37.5 hours. He was made redundant on 31 May 2013.

The project manager alleged that the employer had breached his contract of employment and also the Fair Work Act 2009 by contravening:

  • ​s340 by taking adverse action against him; namely, failing to return him to his pre-leave position, requiring him to work casual and then part-time and only remunerating him on that basis
  • s351 by discriminating against him; namely, taking adverse action against him because of his family responsibilities
  • s345 by knowingly or recklessly making a false or misleading statement about his workplace rights in relation to parental leave
  • s44 by contravening provisions of the National Employment Standards.

Breach of NES


The Federal Circuit Court of Australia found that the project manager’s reduction of work hours and pay had been caused by the downturn of work available to the employer’s company as a result of the GFC and the subsequent downturn in business, and not for any reason prohibited by the Act.

The project manager contended that the other project managers had not suffered similar deterioration in workplace benefits. The court said that was true, but other positions had also been declared redundant. Discrimination or adverse action was not established.

The court found that the employer had breached the National Employment Standards by failing to apply the correct parental leave provisions. However, it had not been a reckless misrepresentation. The court confirmed that unpaid parental leave was a workplace right under s70 of the Act.

The project manager had been entitled to return to full-time work after his leave. The employer had repudiated his contract of employment when it offered him the part-time contract.

The project manager’s termination payment had been incorrectly calculated on the basis of his part-time pay. He was entitled to damages representing the difference between part-time and full-time rates from when he returned to work and when his position was made redundant. He was also entitled to payment in lieu of accrued annual leave and severance pay at a full-time rate. These items added up to a total of $169,347.

The court dismissed the claims of adverse action, discrimination and misrepresentation and ordered the employer to pay the project manager a total of $169,347.

The bottom line: Employees returning from parental leave have certain guaranteed rights and employers breaching these rights can be confronted with both civil action and prosecution.

S v Coffey Projects (Australia) Pty Ltd [2015] FCCA 1514 (4 June 2015) 

See also: Can someone on parental leave be made redundant?

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