Subsequently changing an employee's role may not constitute
misleading and deceptive conduct or breach of contract where the
change is brought about by evolution in thinking and in
In Keays v JP Morgan Administrative Services Australia Ltd
 FCA 1603 an employee, Mr Keays, sued his employer JP
Morgan for damages for breach of contract and misleading and
deceptive conduct when his employment ended in June 2008. During
his employment, his role changed from public sector banking to
private sector banking and upon termination JP Morgan agreed to pay
him a severance payment consisting of three months pay in lieu of
notice and leave entitlements.
Prior to joining JP Morgan, he claimed JP Morgan promised him
pay (including stock options) totalling $1.275 million, and
managing director status. He argued that the representations made
by JP Morgan were not fulfilled. The case centred upon a change to
his position throughout his two years of employment, during which a
foreign exchange portfolio was removed and given to another
In handing down his decision, Justice Robert Buchanan ruled that
Mr Keays was unable to show that he was entitled to the unvested
stock and that it survived the termination of his employment. He
also found that Mr Keays had a contractual right to remuneration,
but had not suffered any financial prejudice as a result to the
change of his role. The judge found that "no occasion arose to
assess the impact of this change on any bonus". Therefore it
was impossible to assess any damages. The judge was also not
satisfied that JP Morgan mislead Mr Keays about the nature of his
position that he was offered. He ruled that the changes that were
made to Mr Keays' position were a consequence of
"evolution in thinking and in direction" and that the
implications for Mr Keays' position emerged well after he was
The case demonstrates that where an employee's position
changes over time due to the natural evolution of the business, it
does not necessarily mean that the employee was misled if their
position also changes.
Truman Hoyle is a Sydney based law firm serving the new
economy industries across the Asia Pacific region. Australasian
Legal Business has recently ranked the firm's
Telecommunications, Media & Technology and Intellectual
Property practices as top-tier in Sydney. The firm was named
Australian Law Firm of the Year in 2005 and again in 2006, for
firms with 50 lawyers or less. In 2009 our firm was awarded the
prestigious ACOMM Award for Professional Services Excellence at the
annual Australian telecommunications industry awards.
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Long experience representing many of Australia's leading employers has taught us that in employment litigation the identity of an employee's representative is a major factor in how employee litigation runs.
Australian employees receive certain entitlements (such as annual leave and superannuation) where contractors do not.
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