s 120 - Redundancy pay

Application to vary redundancy pay - application made in error - no entitlement to redundancy pay - application dismissed.

• [1] On 8 March 2025, Regal Cabinets Pty Ltd (the Applicant) applied to the Fair Work Commission for an order under s 120 of the Fair Work Act 2009 (Cth) (the Act) that the amount of redundancy pay due to Mr Christopher Hazel be reduced by 100 percent.

• [2] On 19 March 2025, a conference was convened with the parties. A Notice of Listing was provided for Mr Hazel to attend this conference. However, he did not attend.

• [3] During the conference, the Applicant disclosed that Mr Hazel had resigned from his employment in November 2024. The application to reduce a redundancy payment was made on 8 March 2025.

• [4] It was uncontroversial that the Applicant was covered by the Timber Industry Award 2020[1] (the Award) and that Applicant was a small business employer for the purposes of the Award.

• [5] Clause 39.4 of the Award sets out an entitlement to redundancy payments for employees of small business employers (clause 39.4(a) and (d)). It is understood that the Applicant is a small business employer - having had less than 15 employees at the relevant time.

• [6] Under clause 39.4 of the Timber Industry Award 2020 an employee of a small business employer is entitled to a redundancy payment if the employee's employment is terminated:

(i) at the employer's initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or

(ii) because of the insolvency or bankruptcy of the employer.

• [7] However, in circumstances where an employee has voluntary resigned from their employment there is not an entitlement to redundancy payment.
• [8] By email dated 19 March 2025, the Commission informed the Applicant and Mr Hazel that it was proposing to dismiss the application on the basis that the application had no reasonable proposes of success and/or the application had not been made in accordance with the Act (see s 587 of the Act). Parties were further informed that an application to vary an amount of redundancy pay is of no utility in the absence of there being an entitlement to redundancy pay (for example, where the employee has resigned).

• [9] The Applicant and Mr Hazel were provided with the opportunity to respond to the proposed dismissal of the application under s 587 of the Act. Neither party were forthcoming with a response, and I considered it appropriate to determine the matter on the papers.

• [10] The Commission's powers to dismiss an application are set out generally at s 587 of the Act. That section states:

(1) Without limiting when the FWC may dismiss an application, the FWC may dismiss an application if:

(a) the application is not made in accordance with this Act; or

(c) the application has no reasonable prospects of success.

Note: For another power of the FWC to dismiss an application for a remedy for unfair dismissal made under Division 5 of Part 3-2, see section 399A.

(2) Despite paragraphs (1)(b) and (c), the FWC must not dismiss an application under section 365, 536LU or 773, or an application under section 527F that does not consist solely of an application for a stop sexual harassment order, on the ground that the application:

• [11] Whenever exercising the power to dismiss an application under s 587, s 578 is relevant. It provides:

578 Matters the FWC must take into account in performing functions etc.

In performing functions or exercising powers, in relation to a matter, under a part of this Act (including this Part), the FWC must take into account:

(a) the objects of this Act, and any objects of the part of this Act; and

(b) equity, good conscience and the merits of the matter; and

(c) the need to respect and value the diversity of the work force by helping to prevent and eliminate discrimination on the basis of race, colour, sex, sexual orientation, breastfeeding, gender identity, intersex status, age, physical or mental disability, marital status, family or carer's responsibilities, subjection to family and domestic violence, pregnancy, religion, political opinion, national extraction or social origin.

• [12] The Commission has power to dismiss an application on its own initiative. It is accepted that there is no legislative or common law requirement pursuant to which the Commission must persevere with an application in circumstances where it is evident that an application would have no prospects of success.

• [13] Having regard to the circumstances of this matter, I am satisfied that the application has no reasonable prospects of success. Whilst the Applicant seeks to vary a redundancy payment for Mr Hazel, he was not, at the relevant time, entitled to a redundancy payment in light of the operation of clause 39.4 of the Award. The application is therefore misconceived.

• [14] It follows it is appropriate to dismiss the application pursuant to s 587(1)(c), therefore proving unnecessary to consider the applicability of s 587(1)(a).

• [15] An Order[2] to this effect is issued concurrently.

[2] PR785447.

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