Fair Work Australia (FWA) may take in to
account, among other things, 'any matter that FWA considers
relevant' when determining an amount for payment of
compensation for unfair dismissal. In Wong v Nytro Pty Ltd
trading as Nitro Gym  FWA 1927, FWA accepted that
additional child care costs incurred by the applicant in looking
for and taking up new employment could be taken into account when
determining appropriate compensation.
The employee was dismissed from her part time job and originally
told that she was redundant. FWA found that the dismissal was not a
'genuine redundancy' because there had been no consultation
in accordance with the relevant award. Alleged misconduct and
performance issues were later raised by the employer. FWA found
that the employer did not tell the employee that she was terminated
for misconduct and had failed to give the employee an opportunity
to respond to any reason for dismissal related to capacity or
performance. In the circumstances, FWA found that the dismissal was
harsh, unjust and unreasonable.
As to remedy, FWA determined that reinstatement was impractical
and so was required to determine appropriate compensation. During
the proceedings, the employee led evidence to show that she had
incurred additional child care costs while looking for and taking
up new employment. FWA accepted and was prepared to take into
account when determining compensation additional child care costs
equal to the applicant's period of unemployment as 'a
cost incurred directly as a result of the termination of
This decision represents the first known occasion that child
care costs have been taken into account when determining unfair
dismissal compensation orders.
Key lessons for employers
Employers should always have a valid reason for dismissal and
ensure procedural fairness by giving an employee the opportunity to
respond to any conduct or performance issues before taking the
decision to terminate employment. There are potentially a wide
range of costs – including and in addition to childcare
costs - that may be incurred by a former employee as a result of
termination of employment. Where termination is found to have been
the result of unfair dismissal, such costs may be awarded against
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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