Automotive, Food, Metals Engineering, Printing and Kindred Industries Union v Mechanical Engineering Services Pty Ltd (No 2) [2008] FCA 1249

Automotive, Food, Metals Engineering, Printing and Kindred Industries Union v Mechanical Engineering Services Pty Ltd (No 2) [2008] FCA 1249

The award drew a distinction between standard rates of pay and actual rates of pay; in the absence of a contrary indication, redundancy payments calculated by reference to a "week's pay" and "ordinary time rate of pay" were to be based on the standard award or replacement rate, not the rate actually paid. Payment in lieu of notice was recoverable because, although the award required assessment by reference to what would have been payable had employment continued, s 507 did not apply to a simple contract debt payable to former employees after termination. For penalty purposes there were two breaches, failing to make redundancy payments and failing to make payments in lieu of notice,...

Jurisdiction
Australia
Judgment Date
19 August 2008
Procedural Posture
Industrial and Employment Application for Breach of Award / Determination of Outstanding Issues After Earlier Finding of Breaches: Penalties, Calculation of Unpaid Redundancy Payments, and Entitlement to Payment in Lieu of Notice
Outcome
Outstanding issues determined: redundancy payments to be calculated by the standard award or replacement ordinary time rate; dismissed employees entitled to payment in lieu of the short notice period; penalties imposed for two breaches.
Legal Topics
['breach of Award' 'redundancy Payments' 'ordinary Time Rate of Pay' 'payment in Lieu of Notice' 'industrial Action' 'civil Penalties']
['industrial and Employment Law'] ['breach of Award' 'redundancy Payments' 'ordinary Time Rate of Pay' 'payment in Lieu of Notice' 'industrial Action' 'civil Penalties']

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 1 Authorities cited 2 Party arguments 2 Amounts and remedies 1
Sign in to unlock

Procedural Posture

Industrial and Employment Application for Breach of Award / Determination of Outstanding Issues After Earlier Finding of Breaches: Penalties, Calculation of Unpaid Redundancy Payments, and Entitlement to Payment in Lieu of Notice

Legal Issues

  1. 1 ["What penalty ought be imposed for the respondent's breaches of the Metal, Engineering and Associated Industries Award 1998." 'How unpaid redundancy payments are to be calculated, including the meaning of "ordinary time rate of pay" in the definition of "week\'s pay".' "Whether dismissed employees are entitled to recover an amount equal to one week's pay where the notice of termination was short, despite industrial action and s 507(2) of the Workplace Relations Act 1996 (Cth)."]

Ratio Decidendi

The award drew a distinction between standard rates of pay and actual rates of pay; in the absence of a contrary indication, redundancy payments calculated by reference to a "week's pay" and "ordinary time rate of pay" were to be based on the standard award or replacement rate, not the rate actually paid. Payment in lieu of notice was recoverable because, although the award required assessment by reference to what would have been payable had employment continued, s 507 did not apply to a simple contract debt payable to former employees after termination. For penalty purposes there were two breaches, failing to make redundancy payments and failing to make payments in lieu of notice,...

Court Disposition

Outstanding issues determined: redundancy payments to be calculated by the standard award or replacement ordinary time rate; dismissed employees entitled to payment in lieu of the short notice period; penalties imposed for two breaches.

Orders

  • ['Penalty of $3,000 for breach of cl 4.3.1 of the award.' 'Penalty of $10,000 for breach of cl 4.4.3 of the award.' 'The penalty amounts are to be paid to the applicants.' 'The respondent may make the redundancy payments and payments in lieu in three equal monthly instalments, with the $13,000 in penalties to be...