By Paul Moorhouse -
Snapshot
- Under the Fair Work Act 2009 (Cth), unpaid employee entitlements can be recovered from the employer and, in appropriate cases, from a director or other knowing participant.
- A director or other knowing participant will be liable if they were ‘involved’ in the relevant contraventions in the sense required by s 550 of the Act.
- The recent Federal Circuit Court decision in CFMEU v RGN Mining Services Pty Ltd [2017] FCCA 1546 provides an example of the recovery of unpaid entitlements from an individual director where the corporate employer was in liquidation.
- In that case the director was ordered to pay not only unpaid award and agreement entitlements, but also contractual entitlements not paid by the employer.
Most readers would be aware that employees can make an application under the Fair Work Act 2009 (Cth) (‘the Act’) to recover unpaid statutory and award or agreement entitlements from their employer. Applications are usually brought in the Federal Circuit Court, although the Federal Court and some state courts also have jurisdiction to deal with such applications.
One aspect of such proceedings may be less well known. In appropriate cases a company director or other knowing participant in the failure to pay the employee entitlements can be ordered to meet the unpaid entitlements, on the basis that he or she was involved in the relevant contraventions and is thus deemed by the Act to also have committed the contraventions.
The recent Federal Circuit Court decision in CFMEU v RGN Mining Services Pty Ltd [2017] FCCA 1546 provides an example of the recovery of unpaid entitlements from an individual director in circumstances where the corporate employer had gone into liquidation. The case also shows that a director can be ordered to pay unpaid contractual entitlements.
