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Company ordered to pay CIO’s retention bonus

Introduction In a recent Victorian Court of Appeal decision, an employer was ordered to pay almost half a million dollars in unpaid entitlements to an employee following a restructure. Factual Background Mr Stevens entered into an arrangement with the employer on October 2011 which entitled him to shares in the company.  The share value was equivalent to 12 months’ salary. Under the arrangement Mr Stevens accrued the shares if he remained in continuous employment with the company from 1 September 2011 to 1 September 2013 (the retention bonus) or he was made redundant. In August 2012, new management took over the employer. The new Managing Director and CEO, Mr Bruce Dixon, had several meetings with Mr Stevens in relation to a restructure of his role and the possibility of his role being made redundant. Much of what transpired during those discussions were disputed during trial. The key contention made b...

14 February 2017

Swapping redundant positions

Introduction Section 389 of the Fair Work Act 2009 sets out the meaning of genuine redundancy. If the requisite requirements of the section are met, this provides the employer with a defence to an unfair dismissal application. One of the obligations under subsection 389(2) is a requirement for the employer to consider whether in all the circumstances it was reasonable to redeploy the employee within:        (a)    the employer's enterprise; or        (b)    the enterprise of an associated entity of the employer. A recent decision on redeployment In a January 2017 decision, a Full Bench of the Fair Work Commission (the Full Bench) determined that whilst “there is no general obligation for an employer to implement or facilitate a process whereby employees whose positions are redundant can swap with other employees who wis...

14 February 2017

Redundant employees reinstated

Introduction Recently the Fair Work Commission (the Commission) found that employees dismissed for redundancy were unfairly dismissed because the employer failed to: meet the consultations obligations that operate under the applicable enterprise agreement; and consider reasonable redeployment opportunities. Further, as redeployment opportunities were available, the Commission ordered their reinstatement with back pay. Facts Staples Australia Pty Ltd (Staples) dismissed 12 permanent warehouse employees from its Erksine Park site for redundancy.  The warehouse was performing overbudget for several years and labour accounted for 60% of the costs.  Staples made its decision to reduce the number of permanent warehouse staff on 5 July 2016.   The decision was announced on 11 July 2016 at the Joint Consultant Committee (the JCC) which is provided for ...

13 February 2017