Clerke v Vortex Aircraft Maintenance Pty Ltd

Note: The form of the order is subject to the entry in the Court's records.

Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 24.04(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2025 (Cth)), or to record a variation to the order pursuant to r 24.04 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2025 (Cth).

1. On 9 October 2025 I made orders and published reasons in the primary judgment in Clerke v Vortex Aircraft Maintenance Pty Ltd [2025] FedCFamC2G 1629 (PJ).
2. I dismissed Mr Clerke's claim of a breach of the general protections in Part 3.1 of the Fair Work Act 2009 (Cth) (FW Act) as against his employer, Vortex (sometimes referred to as VAM), and as against Mr Woodland, Vortex's CEO and the Second Respondent.
3. These reasons concern:

(a) a penalty as to Vortex's admission that it failed to give notice or make a payment in lieu of notice under s. 117(2) of the FW Act; and

(b) a consequential issue as to interest under s. 547(2) of the FW Act on the late payment in lieu of notice.

A PENALTY AS THE FAILURE TO PAY AN AMOUNT IN LIEU OF NOTICE

1. Before trial, Vortex admitted that it had failed to provide notice, or a payment in lieu of notice, on the termination of Mr Clerke's employment under s. 117(2)(b) of the FW Act_._ As a result, I made a declaration in the primary judgment as follows:

On 1 June 2023 the First Respondent contravened s. 44 of the Fair Work Act 2009 (Cth) by failing to give the Applicant notice or pay the Applicant in accordance with s. 117(2) of the _Fair Work Act 200_9 (Cth).

1. I necessarily held over an appropriate penalty as to Vortex's admitted contravention of s. 44 of the FW Act (PJ, [10], [174]).
2. The crux of my finding as to Vortex's admitted contravention was set out in the primary judgment as follows (at [174]):

Vortex admitted that it did not provide notice or payment in lieu of notice to Mr Clerke under s. 117(2)(b) because it did not provide "notice of the termination before it took effect or pay in lieu of notice until 17 April 2025" (Amended Defence, 21(b)). The requirement to provide "notice of termination" as a National Employment Standard is a minimum standard which cannot be "displaced" under s. 61(1) and s. 61(2)(j) of the FW Act. Vortex made the notice payment - very late, on 17 April 2025 - some 22 months after the date Vortex itself identified as the date of dismissal (and I have found in fact to be the date of dismissal), 1 June 2023.

1. The parties have consented to the determination of an appropriate penalty "on the papers" based on their submissions and unchallenged affidavit evidence. I am satisfied it is expedient to proceed on the papers on the basis that there are not contested factual issues which require determination.
2. The essential facts set out in the primary judgment which frame the decision as to an appropriate penalty are as follows:

(1) on 20 April 2023, Mr Clerke attended Vortex's workplace for the last time (PJ, [29]);

(2) on that day Mr Woodland issued Mr Clerke with three written warnings and made a written request for him to advise a meeting time to discuss the warnings as soon as possible (PJ, [31] - [34]:

(3) from 21 April 2023 Vortex regarded Mr Clerke as on annual leave. Mr Clerke communicated that he would not be available for meeting until 27 April 2023 (PJ, [36] -[37]);

(4) by 27 April 2023, the "proposed meeting ... had apparently fallen by the wayside" (PJ, [44]);

(5) further, by 27 April 2023, "the parties seemed resigned to the inevitability of the end of Mr Clerke's employment" (PJ, [45]);

(6) thereafter, between 27 April 2023 and 1 June 2023, there was no direct communications between the parties except for the issue of weekly payslips by Vortex to Mr Clerke (PJ, [46]);

(7) on each of "11, 18 and 25 May 2023 Vortex paid Mr Clerke one week's annual leave" (PJ, [49]); and

(8) on 1 June 2023 Vortex paid Mr Clerke "approximately 506 hours of accrued but untaken annual leave, his remaining annual leave balance" (PJ, [50]).

1. In those circumstances, I concluded that the date Vortex dismissed Mr Clerke from employment was 1 June 2025 (PJ, [59]).
2. Mr Clerke's period of service with Vortex and his age meant that he was entitled to not less than 5 weeks' notice of the termination of his employment. Vortex did not provide notice, or payment in lieu, to Mr Clerke.
3. On 30 April 2025 - about a week before the trial commenced on 5 May 2025 - Vortex amended its defence and admitted that it terminated Mr Clerke's employment without providing the required minimum statutory notice to him of the dismissal before it took effect or payment in lieu of notice until 17 April 2025 (Amended Defence, [21]).
4. On 17 April 2025, shortly before it amended its defence, Vortex paid Mr Clerke $14,903.85 an amount equal to 5 weeks' pay in lieu of notice.
5. It was therefore common ground that the court may order that Vortex pay a pecuniary penalty under s. 546(1) of the Act because Vortex has contravened a civil penalty provision,

1. It was also common ground that the value of a penalty unit at the date of the contravention was $275. As a result, the maximum penalty for Vortex as a corporate contravener for the single contravention is $82,500 (s. 546(2)(b)).

1. For the purposes of the penalty hearing, each party filed written submissions. Mr Clerke filed an affidavit made on 30 October 2025 (marked in the penalty hearing A1) and Mr Woodland filed an affidavit made on 25 November 2025 (R1).
2. Mr Clerke submitted that a penalty at 75% of the statutory maximum in the amount of $61,875 was appropriate.
3. Vortex submitted that an appropriate penalty is 7.5% of the statutory maximum in the amount of $6,200.

1. Under s. 546(1) of the FW Act I may order a person to pay a pecuniary penalty that is "appropriate".
2. As to the purpose of civil penalties, in Australian Building and Construction Commissioner v Pattinson (2022) 274 CLR 540_;_ [2022] HCA 13 the High Court said at [9]:

... the purpose of a civil penalty is primarily, if not solely, the promotion of the public interest in compliance with the provisions of the Act by the deterrence of further contraventions of the Act...

1. Deterrence encompasses both specific and general deterrence.
2. In Pattinson, the High Court explained the various factors - pertaining both to the character of the contravening conduct and to the character of the contravener - which French J (as he then was) identified in Trade Practices Commission v CSR Ltd (1991) ATPR 41-076; [1990] FCA 521, [42] - which are relevant to determining the quantum of the penalty which would achieve deterrence in a particular case (Pattinson, [18], [55]).
3. The deterrence objective requires the imposition of a penalty with "a view to ensuring that the penalty is not such as to be regarded by [the] offender or others as an acceptable cost of doing business": Singtel Optus Pty Ltd v Australian Competition and Consumer Commission (2012) 287 ALR 249; [2012] FCAFC 20, [62].
4. Tracey J in Kelly v Fitzpatrick [2007] FCA 1080 distilled nine non-exhaustive factors at [14] (which reflect the factors French J had identified in CSR) relevant to the fixing of a penalty:
   • The nature and extent of the conduct which led to the breaches.
   • The circumstances in which that conduct took place.
   • The nature and extent of any loss or 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 the 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.
5. The High Court noted these matters do not constitute a "rigid catalogue of matters for attention" (Pattinson, [19], citing Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith (2008) 165 FCR 560; [2008] FCAFC 8, [91]).
6. I turn next to those factors as far as they are relevant in this case (some of which I have dealt with together).

THE APPLICATION OF THE PRINCIPLES TO THE CIRCUMSTANCES OF THIS CASE

Nature and extent of the conduct and the circumstances in which the conduct took place

1. I accept Mr Clerke's submission that the payment in lieu of notice was very late, 17 April 2025, 22 months after his dismissal on 1 June 2023. Mr Clerke was kept out of his money for an extended period. On the Applicant's submissions, the "extended non-compliance" actuated the need for the substantial penalty for which Mr Clerke contended.

1. To a degree, the nature and extent of Vortex's conduct is ameliorated by the fact that Vortex remedied the contravention before trial without the need for a court order.
2. As a result of the remedying of the contravention, aside from an interest claim (dealt with below), there is no financial loss and damage which Mr Clerke continues to suffer because of the contravention.
3. The concept of loss and damage is not limited to monetary loss and damage. Mr Clerke says that the "delay in payment caused substantial stress to me and my family" (Ex A1, [8]). I accept that the non-payment of a payment in lieu of notice would have caused stress. The purpose of the statute in providing for a minimum payment in lieu of notice is to cushion the financial stress of an employee's job loss in circumstances when the employee will need to find alternative employment but continues to have the financial commitments of day-to-day life. If the payment is not made, the financial stress which inheres in an employee's job loss is increased.
4. On the other hand, the penalty must be imposed referable to the contravention and not extraneous matters such as loss because Mr Clerke was only able to find alternative employment at a lower level of income and litigation stress which factors are distinguishable from Vortex's contravention as to a failure to make a payment in lieu of notice. Beyond Mr Clerke's assertion that he and his wife's well-being have been affected, Mr Clerke has not adduced any admissible evidence as to these issues. To the extent that Mr Clerke's stress was occasioned by the court case generally, Mr Clerke has not been successful in his principal general protections claims.
5. Further, the quantum of the contravention was modest in the amount of $14,903.85 by reference to Mr Clerke's annual remuneration.

Whether there has been similar previous conduct by the respondent

1. Mr Woodland deposed (and I accept) that he had "never previously been involved in a proceeding this type" (Ex R1, 5(c)).
2. Mr Woodland says that to the best of his knowledge there have not been underpayment or notice related issues as to an employee other than Mr Clerke (Ex R1, 7(i)):
3. There is no evidence of similar previous conduct by Vortex.

1. The evidence at trial was that Vortex was a small business. Mr Clerke was the most senior employee in Vortex's small maintenance team of about 4 employees (PJ, [21]). Overall, the business had fewer than 15 employees.
2. There was no evidence of Vortex's financial circumstances.

1. In Dorsch v HEAD Oceania Pty Ltd (Penalty) [2024] FCA 484 Raper J noted that "the deliberateness of a contravention is a factor indicating an increased need for specific deterrence." Her Honour said the concept of deliberateness was "spectral." Her Honour wrote that the concept of deliberateness at [12] "may also include additional aggravating features such as deliberately flouting the law, being reckless, wilfully blind, "courting the risk" or otherwise being negligent."
2. Mr Woodland deposed (Ex R1, [4(c)):

the reason VAM didn't pay [Mr Clerke] any pay in lieu of notice at around the time of his dismissal was because I was confused about whether it was owed to [Mr Cleke] because he had been away from work for more than 5 weeks as at 1 June 2025 when Justin was dismissed, and I thought that this period was like a notice period

1. Mr Woodland deposed that in the 20 April 2023 - 1 June 2023 period, he "was unsure whether Mr Clerke had resigned, whether he was still employed but on some form of stand down, or whether he would return to work" (Ex R1, 5(a)).
2. He deposed that (Ex R1, 5(d)):

With the benefit of hindsight, I accept that at that point [1 June 2023] I should have appreciated that, separate from what had occurred while he was away from work, VAM was required to pay Justin 5 weeks' pay in lieu of notice. At the time I did not turn my mind to this, and I did not calculate or pay any separate amount for notice;

1. Mr Clerke deposes that his lawyer made written requests to Vortex for his notice pay in 2023 and 2024 (Ex A1, [5]). He does not, however, attach the correspondence. Mr Woodland deposes that he has "no recollection of receiving correspondence ... in 2023 and 2024 seeking payment ... in lieu of notice" (Ex R1, [6]). At trial, the date of dismissal remained disputed, because of the particular way in which Mr Clerke's employment came to an end. In the absence of clear evidence as to the nature of the correspondence which passed between the parties, I do not find that any unanswered demand (or unanswered demands) for payment constitute an aggravating feature of the Vortex's conduct.
2. Mr Clerke asserted that Vortex's "delay in payment notice pay was deliberate" (Cf Ex A1, [10]).
3. Mr Woodland deposed that the failure to pay notice was an "oversight" and not a "deliberate decision" (Ex R1, 5(i)).
4. I conclude that the contravention was a result of a failure to exercise sufficient care rather than a deliberate flouting of the law. I accept that there was genuine confusion around the series of events leading up to the end of Mr Clerke's employment with Vortex and Mr Clerke's employment status in the period 20 April 2023 - 1 June 2023. Once Mr Woodland authorised the payment in lieu of accrued and unused annual leave to Mr Clerke on 1 June 2023 he ought to have realised that Vortex had to make a notice payment and he exercised insufficient care to take the necessary steps to ensure that Vortex met its minimum legal obligations.

Whether senior management was involved in the breaches

1. Mr Woodland's own evidence is that he processed Mr Clerke's accrued and untaken annual leave payment on 1 June 2023, which crystallised his entitlement to a payment in lieu of notice (Ex R1, 5(d)).
2. Because Mr Woodland was the CEO and a director of Vortex, it follows that senior management was involved in the breach.

Whether the party committing the breach had exhibited contrition.

1. Mr Woodland has apologised in his affidavit to Mr Clerke for any impact upon him by his failure to pay the notice (Ex R1, 5(j)).

Whether the party committing the breach taken corrective action

1. I have already noted that Vortex - very belatedly, but before trial - remedied the contravention.
2. Mr Woodland also deposed that Vortex has taken steps since these events to prevent similar issues arising in the future. The business has "established a dedicated HR/accounts function" and engaged payroll employees with direct responsibility in this area rather than Mr Woodland himself managing these issues (Ex R1, 7(a)-(c)).

The need for compliance with minimum standards and specific and general deterrence

1. The purpose of a civil penalty is general and specific deterrence. Contraventions of minimum entitlements are to be viewed seriously.
2. As Raper J said in Dorsch at [29]:

In order to achieve general deterrence a clear signal must be sent to the Australian community at large that all employers have an obligation to know and understand their obligations under the FW Act and that lack of care and ignorance of the law is no excuse: Fair Work Ombudsman v Lifestyle SA Pty Ltd [2014] FCA 1151 at [156].

1. The fixing of appropriate penalties continues to require a process of instinctive synthesis to the extent that the court must integrate a number of identified input factors into a single, numerical outcome with the aim of achieving deterrence (Australian Competition and Consumer Commission v Reckitt Benckiser (Australia) Pty Ltd (2016) 340 ALR 25; [2016] FCAFC 181, [175]).

1. In that process, I have given some weight to the fact that to achieve general deterrence it is necessary to send a clear signal that all employers (regardless of their size) have an obligation to know and meet their minimum obligations, including as to payments in lieu of notice. If, as Mr Woodland says, he was confused as to the circumstances of the end of Mr Clerke's employment it was incumbent on Mr Woodland to interrogate Vortex's obligations as of 1 June 2023. Vortex offered no cogent explanation as to why it only really focused on remedying the situation - in early 2025 - in the lead up to trial. Its inaction exposed a certain level of indifference to compliance with its obligations and, as Mr Clerke submitted, led to an extended period of non-compliance.
2. On the other hand, the single contravention of modest dimensions was remedied before trial. There is no prior history of non-compliance. Vortex has taken broader corrective action within its business as to its payroll processes which is likely to avoid any recurrence of the situation and reduces the need for specific deterrence.
3. In all the circumstances I intend to impose a penalty of $16,500 which is equal to 20% of the maximum penalty.

1. As a final check and application of the totality principle, I must ensure that the total penalty is not, in all the circumstances, excessive. I am satisfied that the total penalty of $16,500 is appropriate.

1. It was common ground that there was no reason to deviate from the usual order that the penalty be paid to the Applicant (Sayed v Construction, Forestry, Mining and Energy Union (2016) 239 FCR 33; [2016] FCAFC 4, [101]).

1. At trial, I also held over consequential matters (PJ, [177]).

1. The first consequential matter is that the Applicant seeks interest on the late payment of the payment amount in lieu of notice for the period between 1 June 2023 and 17 April 2025 under s. 547(2) of the FW Act. Vortex's submissions are silent as to interest.
2. Section 547(2) is as follows:

(2) In making the order the court must, on application, include an amount of interest in the sum ordered, unless good cause is shown to the contrary.

1. As to the rate of interest, note 2 to r. 24.05 of the Federal Circuit and Family Court of Australia (Division 2)(General Federal Law) Rules 2025 (Cth) sets out that s. 211(3) of the Federal Circuit Court and Family Court of Australia Act 2021 (Cth) provides that in the making of orders that include pre-judgment interest the court will have regard to the Federal Court's Interest on Judgments Practice Note (see also Taylor v Peninsula Sports Academy Pty Ltd [2019] FCCA 1929, [27]). Note 2 sets out that:

In making such an order, the Court will have regard to the rate specified in paragraph 2.2 of the Federal Court's Interest on Judgments Practice Note.

1. I have calculated - and will order - interest in accordance with pre-judgment interest rates under the Federal Court's Interest on Judgments Practice Note as follows:

1. I also held over an issue of whether compensation ought to be ordered as to any unpaid superannuation on the notice payment (PJ, [177]). Vortex had accepted that superannuation should be paid on the payment in lieu of notice.
2. Mr Woodland deposed that the relevant superannuation has now been paid - albeit very recently - on 24 November 2025 (Ex R1, 5(g)). In circumstances in which Mr Clerke has not disputed Mr Woodland's evidence as to the payment of superannuation, I accept Mr Woodland's evidence. The delayed payment of the superannuation means that Mr Clerke has lost earnings which might have been expected to accrue had the superannuation on the notice payment been paid in a timely fashion, but the amounts involved are de minimis, and do not warrant any separate order_._

1. I will make orders that Vortex pay interest fixed in the amount of $2,304.83 as to the late payment of the payment in lieu of notice. Ordinarily, if no time is specified for compliance with the order, an order must be complied within 14 days under r. 24.02(b). Given the Christmas break, I will order the interest payment to be made by 16 January 2026. If it is not paid, post- judgment interest will accrue.
2. I will order that Vortex pay a penalty of $16,500 be paid by 22 January 2026 (that is, within 42 days of the date of these orders) with the penalty to be paid to Mr Clerke.

1. I set out in the primary judgment that it appeared necessary to consider costs issues (if any) at a third stage of the proceeding (PJ, [182]).
2. Any application for costs by any party should be made not later than 4.00 pm on 29 January 2026.

I certify that the preceding sixty-eight (68) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Champion.