Introduction

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Snippet: Cost awarded against ex-employee in unfair dismissal case.

In somewhat rare event the FWC has awarded costs against the applicant in an unfair dismissal matter, after the applicant withdrew her application.

Background

The FWC in this matter requested that the parties file their written submissions by a certain date. The company requested and was granted further time to submit its arguments.

The applicant commenced performing work for the company on 18 April 2018 until she was notified on 11 January 2020 that she was not required to perform any further work.

The applicant (ie the ex-employee), presumably deciding that her case was not strong, sought to discontinue the matter.

Upon the applicant ceasing to sue for unfair dismissal, the respondent sought an award from the FWC for the applicant to pay its legal costs resulting from the unfair application. The FWC gave the parties time to make submissions on the subject, however the applicant – despite an extension of time – failed to respond the FWC’s request.

The company allegations included the embezzlement of its funds

The respondent argued that the application for unfair dismissal was made vexatiously and without reasonable cause and had no reasonable prospect of success causing reh company to incur costs as a result the applicant’s unreasonable acts and omission.

The company successfully argued that the applicant:

  • Was an independent contractor not an employee;
  • Was aware that the company employed three people (a small business employer); and
  • Made unauthorised transactions from the company’s bank account and redirected payments to her own account.

The Company sought costs of $14,150.

Outcome

In finding that the company had incurred significant legal costs, however was not satisfied that the application for unfair dismissal was vexatious or without reasonable cause, finding that the applicant would not have foreseen the number of jurisdictional issues; however found that the applicant had substantially drained funds from respondent’s account and on this basis the application had no reasonable prospect of success.

As a result, the applicant had caused respondent to incur costs because of an unreasonable act in connection with the continuation of the matter beyond the conciliation conference and applicant’s actions which would have significantly impacted on the company.

The FWC ordered the applicant to pay respondent $4,000 in weekly instalments of $100.