Australia - Jurisdictional Objections In The Fair Work Commission.
Legal News & Analysis - Asia Pacific - Australia - Insurance & Reinsurance - Labour & Employment
24 February 2021
A recent decision of the Full Federal Court is likely to significantly reduce the number of general protections dismissal applications progressing from the Fair Work Commission (FWC) to a federal court for hearing. The FWC will now decide whether there has been a dismissal, if that issue is in question, when the application is lodged with the FWC rather than leaving it to a federal court to decide. If the FWC decides that there has been no dismissal and declines to issue a certificate, the matter will end, saving employers and their insurers the costs of a federal court proceeding.
Coles Supply Chain Pty Ltd v Milford  FCAFC 152 (Coles Case)
The Coles Case last year, found that the Full Bench of the FWC was incorrect in determining that it did not have the authority to make a finding as to whether the applicant had been dismissed from his employment.
Prior to the Coles Case, the FWC would have considered that it lacked the jurisdiction to determine whether there had been a dismissal, and the employee would have needed to commence proceedings in the Federal Court or the Federal Circuit Court for a determination as to whether there had been a dismissal.
By way of background, an employee who alleges that he or she had been dismissed as a result of exercising a workplace right can make a general protections application to the FWC within 21 days. The FWC is authorised to deal with an application involving a dismissal pursuant to section 365 of the Fair Work Act 2009 (Cth) (FW Act). The FWC must then deal with the dispute in accordance with section 368 of the FW Act. This usually involves the FWC conducting a conciliation between the parties to attempt to resolve the dispute. In the absence of a resolution, the FWC issues a certificate to that effect. An employee cannot issue general protections dismissal proceedings in a federal court unless a certificate from the FWC had been obtained.
FWC approach since the Coles case
Since the Coles Case, in general protections dismissal applications where there is a dispute as to whether an applicant has been dismissed or not, the FWC has been offering parties the opportunity to attend a voluntary conciliation, putting aside for the moment the jurisdictional issue. This at least gives the parties a chance to settle the matter before engaging in difficult and expensive litigation on the jurisdictional objection. If the matter does not settle, then the jurisdictional objection can be heard. To avoid costs an employee may well be keen to have an early conciliation, and to settle at that conciliation, before a hearing on the jurisdictional objection.
Where an employer does not consent to a voluntary conciliation, the FWC lists the matter for a hearing on the issue of the jurisdiction objection. For employers, this is an opportunity to have the objection dealt with early, with the potential to avoid the future costs of a federal court proceeding.
Strategic considerations for employers and their insurers
Decide whether it helps to participate in a voluntary conciliation
If there is a dispute as to whether there is a dismissal, employers may see that an early voluntary conciliation is the best opportunity to settle the matter with least cost. At that point, an employee would also be keen to avoid costs, so it may be a good opportunity to settle.
Assess the strength of the case and the likelihood of an early outcome
If the employer is in a particularly strong position, and the employee has unrealistic settlement expectations, a hearing in the FWC on the jurisdictional objection is an opportunity to have the matter dismissed at an early stage without the need to incur additional costs in a federal court.
Make strategic offers to resolve the matter
If the employer makes strategic written offers to resolve the matter during the course of the proceedings, and if the matter is ultimately dismissed for lack of jurisdiction, it may be possible for the employer to use the employee’s failure to settle on an application for costs under section 375B of the FW Act.
For further information, please contact:
Chris Molnar, Kennedys