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Get out of (Liability) Gaol Free under section 447A

By Jacob Reardon a Solicitor of Matthews Folbigg, in our Insolvency, Restructuring and Debt Recovery Group.

Section 447A of the Corporations Act 2001 (Cth) (“the Act”) enables the Court to make such orders as it thinks appropriate as to the operation of Part 5.3A of the Act. Since its introduction, the Courts have adopted an expansive construction of the provision and have liberally applied the power in a variety of contexts. Accordingly, the provision has become something of a panacea for multiple ills in the context of voluntary administration and has been used in various instances among others to: [...]  READ MORE →

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Employment – Personal Liability for Directors and Managers

Cause for Vigilance!

A string of recent employment cases involving the Fair Work Ombudsman have clearly illustrated the risk posed by the ‘accessorial liability’ provisions within the Fair Work Act.

In essence:

  • accessorial liability is a legal doctrine used to extend legal responsibility for an unlawful act to those involved in or associated with the act
  • in employment claims, accessorial liability can also render a director and/or manager liable for an employer’s contravention of the Fair Work Act

Accessorial Liability under the Fair Work Act

Under the Fair Work Act a person who is ‘involved’ in a contravention of the Fair Work Act is taken to have contravened that provision, where the person:

  • has aided, abetted, counselled or procured the contravention; or
  • has induced the contravention, whether by threats or promises or otherwise; or
  • has been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to the contravention; or
  • has conspired with others to effect the contravention.

Founding Employment Decision

The foundation for such claims brought under the Fair Work Act was the decision of Guirguis v Ten Twelve Pty Ltd & Anor where the court held that in order for a person to be liable under the accessorial liability provisions of the Fair Work Act the person must: [...]  READ MORE →