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Pregnant worker’s redundancy costs company $60k

By Andrew Hobbs on October 9th, 2017

A GAS welding company has been ordered to pay $57,843, made up of lost leave payments and court-imposed penalties, after making a pregnant employee’s position redundant two days before her parental leave was to begin.

The employee’s redundancy was part of a broader program being instigated by BOC at the time, with eight workers expected to lose their jobs on 12 November, 2015.

BOC brought the employee’s redundancy forward to 4 November because, as it told the Federal Circuit Court in Brisbane last week, her parental leave was due to begin on 6 November.

The employee’s supervisor, Andrew Finnie, and BOC’s general manager, Tony Newnham, felt it was in the employee’s best interests that she be informed of the decision before going on maternity leave.

Judge Salvatore Vasta heard that there was a rush to have the redundancy occur on that eafrlier date, meaning that BOC’s policies were not followed in this instance and thereby denying the employee the safeguards of the company’s redundancy policy.

While he accepted that there was a genuine business case for the redundancy, he found that the decision to bring the redundancy date forward meant that the employee could not rely on the return to work guarantee within the Fair Work Act (2009).

This entitles people on unpaid parental leave to return to their previous position or, should it no longer exist, an available position near in status and pay to their previous role.

Judge Vasta found that by making the employee redundant before her leave began denied the employee this, making it an adverse action. He said the date of redundancy had been brought forward because of a prohibited reason.

Penalties

In handing down his findings, Judge Vasta said that the company should have made the position redundant on 12 November.

“If the contravention had not occurred, the [employee] would have been made redundant on 12 November 2015. She would have been entitled to … the full amount of the paid parental leave.”

Paid over 21 weeks, this leave would have been $36,029.91 – with Judge Vasta noting that the employee was paid $11,826 by the Federal Government during this time because she still met the criteria of the government’s paid parental scheme.

BOC was ordered to make up the difference – $24,203.91 – as well as paying an additional interest cost of $4,639.08 and another $9,000 for suffering and humiliation.

Judge Vasta also set a pecuniary penalty of $20,000 – but said in this instance, the money ought to be paid to the employee rather than the court.

“It would be very rare for another member of the community to be in the position that this applicant has found herself,” he wrote.

“While the breach of the [Fair Work] Act is an affront to the community as a whole… the circumstances that have led to this breach are extremely rare indeed.”

No space for ‘motherhood statements’

Understanding the laws governing leave is a challenge for many employers, with different variables and new laws making it challenging for any manager to be fully across all the nuances of what is permitted under Australian law.

In the case of parental leave, it is not only a matter of understanding who is eligible for leave and for how long, but what your obligations are as an employer throughout the duration of that leave.

The Parental Leave Guide provides a rundown of the Paid Parental Leave scheme and explains what the notice requirements are. It also has guidelines on how you can determine which type of parental leave your employees are entitled to and how to calculate their continuous service.

Written in plain English by Employment Law Practical Handbook Editor in Chief Charles Power, the 32-page eBook covers topics including:

  • When does parental leave start?
  • Dad and Partner Pay Scheme
  • Changing the return date
  • What happens if the pregnancy ends unexpectedly?
  • Do paid leave entitlements accrue during unpaid parental leave?

Don’t make a decision without having first consulted The Parental Leave Guide eBook – it can help you deliver parental leave better and avoid exposure to costly charges of unfair dismissal. Get your copy today.





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