Federal Court of Australia

Euro Car Parts Pty Ltd v Cannon [2024] FCA 828

ORDERS

THE COURT ORDERS THAT:

1.    The appeal be allowed only insofar as it concerns whether there was a serious question to be tried as to whether there was an oral agreement, as alleged by Mr Cannon, that he was to be paid an increased salary of $68,000 after he completed a 3 month probation period, being from 21 April 2017.

2.    The orders of the Industrial Magistrates Court of Western Australia made on 17 August 2022 and 24 November 2022 be set aside.

3.    The matter be remitted to the Industrial Magistrates Court of Western Australia to be heard and determined according to law, and consistently with these reasons for judgment.

4.    The appeal is otherwise to be dismissed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

HALLEY J:

A.     Introduction

1    By a notice of appeal filed on 23 December 2022, the appellant, Euro Car Parts Pty Ltd (Company), appeals from orders made by an Industrial Magistrate of the Industrial Magistrates Court of Western Australia (Industrial Magistrates Court).

2    The principal issue raised in this appeal is whether the Industrial Magistrates Court, as an “eligible State or Territory court” for the purposes of the Fair Work Act 2009 (Cth) (FW Act), has the power to make an order to enforce contractual underpayments.

3    Between 19 January 2017 and 13 February 2020, the respondent, Daniel Cannon, was an employee of the Company, initially performing work as a sales consultant. It is accepted by the parties that relevantly during this period, Mr Cannon was a national system employee, and the Company was a national system employer, within the meaning of the FW Act.

4    On 12 May 2021, Mr Cannon filed a claim in the Industrial Magistrates Court seeking recovery of unpaid wages and unlawful deductions from his wages, pursuant to s 323 and s 324 of the FW Act.

5    On 17 August 2022, the Industrial Magistrate entered default judgment in favour of Mr Cannon, and ordered that the Company, having contravened s 323 and s 324 of the FW Act, to pay to Mr Cannon the judgment sum of $51,718.36, inclusive of pre-judgment interest.

6    On 30 August 2022, the Company filed an application to set aside the default judgment.

7    On 24 November 2022, the Industrial Magistrate made orders dismissing the Company’s application to set aside default judgment.

8    The Company appeals from the orders of the Industrial Magistrate on 17 August 2022 entering default judgment in favour of Mr Cannon, and on 24 November 2022 dismissing the Company’s application to have the default judgment set aside.

9    The notice of appeal set out four grounds of appeal. Ultimately, however, only grounds 2 and 4 were pressed.

10    Ground 2 alleges, in substance, that the Industrial Magistrate erred in finding that the Company did not have any evidentiary material of real substance demonstrating that there was a serious question to be tried.

11    Ground 4 alleges that the Industrial Magistrate erred in finding jurisdiction to make the orders on 17 August 2022, pursuant to s 545(3) of the FW Act.

12    The Company seeks orders that the orders made by the Industrial Magistrate on 17 August 2022 and 24 November 2024 be set aside, and for the matter to be remitted to the Industrial Magistrates Court to be heard and determined according to law.

13    Mr Cannon submits that the Industrial Magistrate adopted an orthodox approach consistent with established principles and authorities. He submits that there is nothing to warrant the Industrial Magistrate’s orders being set aside and the matter being remitted for trial. Mr Cannon seeks an order that the appeal be dismissed.

14    For the reasons that follow, I have concluded that the Industrial Magistrates Court did have jurisdiction to make the orders on 17 August 2022 pursuant to s 323 and s 545(3) of the FW Act, but the Industrial Magistrate erred in dismissing the Company’s application to set aside the default judgment on 24 November 2022 with respect to the alleged underpayment of wages in the period prior to the grant of a subclass 457 visa to Mr Cannon.

B.     Background

15    The Company is in the business of selling new and used European spare car parts in Australia. The Company’s head office is based in Villawood, New South Wales.

16    In or about December 2016, Mr Cannon came to Australia from the United Kingdom, on a working holiday visa.

17    On 19 January 2017, Mr Cannon commenced work at the Company’s Kenwick Branch, based in Kenwick, Western Australia, as a sales consultant. At the time of commencing work for the Company, Mr Cannon remained on a working holiday visa, which was to expire on 9 January 2018. There was no written contract of employment between Mr Cannon and the Company at that time, however, it was verbally agreed that Mr Cannon would be paid an annual salary of $50,000 plus superannuation.

18    On 9 November 2017, in order to support Mr Cannon’s visa application, the Company made a written offer of employment to Mr Cannon, for the position of a Technical Sales Representative. The letter of offer provided for an annual salary of $68,000 plus superannuation, but stated that it “will become operative upon grant of your Subclass 457 visa”.

19    On 3 December 2018, Mr Cannon was granted a subclass 457 visa. The Company was the sponsor for Mr Cannon’s visa.

20    On 13 February 2020, Mr Cannon resigned from his employment with the Company.

21    On 12 May 2021, Mr Cannon filed a claim in the Industrial Magistrates Court by way of a Form 1.3 application pursuant to reg 13(1) of the Industrial Magistrate’s Court (General Jurisdiction) Regulations 2005 (WA).

22    On 17 August 2022, when the Company failed to appear, the Industrial Magistrate entered default judgment in favour of Mr Cannon and made the following orders:

1. The respondent having contravened s 323 of the Fair Work Act 2009 (the Act), in that the respondent failed to pay the claimant’s salary in full for the period 1 November 2017 to 13 February 2020 and further that the respondent contravened s 324 of the Act, in that the respondent unlawfully deducted the amount of $5,200 from the claimant’s salary for the period 1 August 2017 to 1 August 2018, the respondent is ordered to pay the judgment amount of $51,718.36, inclusive of pre-judgment interest in the amount of $6,768.36.

2. The remainder of the claim for penalty be adjourned for hearing on a date to be fixed by the Registry.

3. In respect of the claim for penalty, the parties shall lodge and serve written submissions at least three business days prior to the penalty hearing.

4. The claimant’s attendance at the penalty hearing is excused if his representative appears.

23    On 30 August 2022, the Company filed an application to set aside the default judgment.

24    On 24 November 2022, the Industrial Magistrate made the following orders:

1. The application to set aside default judgment is dismissed;

2. The remainder of the claim for penalty is adjourned for hearing on a date to be fixed by the Registry;

3. In respect of the claim for penalty, the parties shall lodge and serve written submissions at least three business days prior to the penalty hearing;

4. The parties’ attendance at the penalty hearing is excused if their legal or industrial representative appears on their behalf;

5. The parties have liberty to apply at short notice.

25    On 3 February 2023, the Industrial Magistrate ordered the Company pay to Mr Cannon, by way of pecuniary penalty pursuant to s 539(2) of the FW Act, the sum of $45,000. This order was not challenged on appeal.

C.     The Industrial Magistrate’s reasons

26    The Industrial Magistrate’s reasons for refusing to set aside the default judgment were recorded on the transcript of the hearing on 24 November 2022.

27    The Industrial Magistrate noted that she had the power to set aside default judgment pursuant to reg 8(3) of the Industrial Magistrate’s Court (General Jurisdiction) Regulations 2005 (WA), however, in considering the exercise of discretion she was required to consider a number of factors. Her Honour said:

The respondent company should only be denied the opportunity to proceed in the ordinary way if there is a high degree of certainty about what the outcome would be should the matter proceed to trial.

The legal proposition for that is set out in a number of cases … However, the respondent is only entitled to an opportunity, sufficient to ensure the just resolution of the case. That’s very clear from the High Court decision of Aon Risk Services Australia Limited v Australian National University [2009] HCA 27 …

28    The Industrial Magistrate then referred to the Court’s duties in s 13(1) and s 13(2) of the Magistrates Court (Civil Proceedings) Act 2004 (WA) to ensure that cases are not only dealt with justly, but also, including ensuring that cases are dealt with efficiently, economically and expeditiously.

29    The Industrial Magistrate identified four issues which she was required to determine:

(a)    whether the Company had provided an adequate explanation for the failure to attend Court and for default judgment being entered against it;

(b)    whether the Company had provided an adequate explanation for any delay in commencing the application to set aside default judgment;

(c)    the merits of any proposed defence; and

(d)    whether Mr Cannon would suffer any irreparable prejudice if the default judgment were set aside.

30    On the first issue, the Industrial Magistrate ultimately concluded that in the interests of justice, but “by the barest of margins” she was satisfied that the Company had provided an adequate explanation for its failure to attend Court and default judgment being entered. Her Honour canvassed the history of case management since the claim was filed in May 2021, and considered that the Company had “ample opportunity” to seek legal advice and prepare for trial.

31    The Industrial Magistrate noted that the second issue, being whether the Company had provided an adequate explanation for any delay in commencing the application to set aside default judgment, did not arise because there was no real delay in the application being filed.

32    The Industrial Magistrate considered that the “most cogent” consideration was whether the Company had a defence on the merits to the claim, citing Crayden v Ottaviano [2003] WASCA 20 (Murray and Templeman JJ and Rolfe AJ). Her Honour said:

In relation to the merits of the action, as a general rule, a judgment entered regularly will not be set aside unless the Court is satisfied that there is a defence on the merits. That rule may be departed from in rare but appropriate cases, though I don’t consider, in this application, that there’s any valid reason to depart from the general rule.

33    The Industrial Magistrate ultimately concluded that having carefully considered the material filed with the Court, her Honour was not persuaded that there was any evidentiary material of real substance demonstrating that there was a serious question to be tried or the existence of a genuine dispute about the claim. The Industrial Magistrate therefore concluded that there would be no utility in setting aside the default judgment.

D.     Principles on appeal

34    The orders made by the Industrial Magistrate on 17 August 2022 and 24 November 2022, together, constitute a “decision”, being formal orders which dispose of, or deal with, the proceeding: Maughan Thiem Auto Sales Pty Ltd v Cooper (2013) 216 FCR 197; [2013] FCAFC 145 at [46] (Katzmann J, Greenwood and Besanko JJ agreeing).

35    This appeal is brought pursuant to s 565(1) of the FW Act, which provides:

An appeal lies to the Federal Court from a decision of an eligible State or Territory court exercising jurisdiction under this Act.

36    The Industrial Magistrates Court is an “eligible State or Territory court” as defined in s 12 of the FW Act: Manescu v Baker Hughes Australia Pty Ltd [2022] WASCA 94 at [50] (Buss, Murphy and Smith JJ).

37    The Federal Court has exclusive jurisdiction to hear and determine an appeal against a decision of an Industrial Magistrate exercising federal jurisdiction pursuant to the provisions of the FW Act: Manescu at [64].

38    It is not necessary to obtain leave of the Court in relation to an appeal brought under s 565(1) of the FW Act: s 565(2) of the FW Act.

39    This appeal invokes the general jurisdiction conferred by s 24 of the Federal Court of Australia Act 1976 (Cth) (FCA Act) and is to be dealt with in accordance with the principles that apply to appeals brought in this Court from primary decisions: Ghimire v Karriview Management Pty Ltd (No 2) (2019) 290 IR 331; [2019] FCA 1627 at [20] (Colvin J).

40    The appellant is required to demonstrate that there was an error of law, or an error infecting a finding of fact: Ghimire at [20] citing Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd (2001) 117 FCR 424; [2001] FCA 1833; Aldi Foods Pty Ltd v Moroccanoil Israel Ltd (2018) 261 FCR 301; [2018] FCAFC 93.

41    The principles to be applied are well settled and were summarised in Lee v Lee (2019) 266 CLR 129; [2019] HCA 28 at [55] (Bell, Gageler, Nettle and Edelman JJ):

A court of appeal is bound to conduct a “real review” of the evidence given at first instance and of the judge’s reasons for judgment to determine whether the trial judge has erred in fact or law. Appellate restraint with respect to interference with a trial judge’s findings unless they are “glaringly improbable” or “contrary to compelling inferences” is as to factual findings which are likely to have been affected by impressions about the credibility and reliability of witnesses formed by the trial judge as a result of seeing and hearing them give evidence. It includes findings of secondary facts which are based on a combination of these impressions and other inferences from primary facts. Thereafter, “in general an appellate court is in as good a position as the trial judge to decide on the proper inference to be drawn from facts which are undisputed or which, having been disputed, are established by the findings of the trial judge”.

(Footnotes omitted.)

42    Consistent with s 27 of the FCA Act, an appeal is by way of rehearing on the evidence before the Industrial Magistrate, with discretion for the Court to receive further evidence.

43    The same orders may be made as on any other appeal against the decision of a primary judge: Ghimire at [21].

E.     Grounds of Appeal

E.1.    Overview

44    As noted above, while the notice of appeal advanced four grounds of appeal, only grounds 2 and 4 were pressed.

45    Ground 2 challenges the Industrial Magistrate’s findings as to the merits of the Company’s proposed defence, specifically, the finding that the evidentiary material did not demonstrate that there was a serious question to be tried, or a genuine dispute about the claim.

46    Ground 4 challenges the Industrial Magistrate’s jurisdiction to make the orders her Honour made on 17 August 2022. This argument was not raised before the Industrial Magistrate.

47    It is convenient to address Ground 4 first because it raises a jurisdictional issue, that if successful, will be dispositive of the appeal.

E.2.     Ground 4

E.2.1.     Overview

48    Ground 4 was set out in the notice of appeal as follows:

The Magistrate erred in finding jurisdiction to make the orders on 15 August 2022 pursuant to s 545(3) of the Fair Work Act in circumstances where the Respondent was not required to pay the amounts alleged under the Fair Work Act or a fair work instrument.

49    Section 545(3) of the FW Act provides:

An eligible State or Territory court may order an employer to pay an amount to, or on behalf of, an employee of the employer if the court is satisfied that:

(a)     the employer was required to pay the amount under this Act or a fair work instrument; and

(b)     the employer has contravened a civil remedy provision by failing to pay the amount.

50    As noted above, the Industrial Magistrates Court is an “eligible State or Territory court” for the purposes of the FW Act.

51    The Company contends that the Industrial Magistrate did not have jurisdiction to make the orders under s 545(3) because the subsection only confers power on the Industrial Magistrate if an employer was required to pay an amount “under this Act or a fair work instrument”. It submits that the Company was not required to pay any amount under the FW Act or a fair work instrument to Mr Cannon, rather, any obligation to pay arose only on a purely contractual basis.

52    The Company submits that the following sections of the FW Act provide examples of amounts payable under the FW Act, (a) s 90 concerning the payment of annual leave, (b) s 117 concerning payment in lieu of notice of termination, and (c) s 119 concerning redundancy pay.

53    The Company drew to the Court’s attention and sought to place particular reliance upon an article by Tae Kim “Section 323 of the Fair Work Act 2009 (Cth): Can It Enforce Contractual Entitlements?” (2022) 35(3) Australian Journal of Labour Law 206 that reviewed recent authorities that had addressed the extent to which s 323 had been utilised to enforce contractual underpayments under the FW Act.

54    Mr Cannon submits that his claim for underpayment of wages falls within the jurisdiction conferred on the Industrial Magistrates Court by s 545(3) of the FW Act. He submits that the failure of the Company to pay the agreed amount of wages and the deductions it made from his wages, are underpayments and deductions that are payable by the operation of s 323 and thereby became amounts payable under the FW Act. He submits that as s 323 is a civil remedy provision both s 545(3)(a) and s 545(3)(b) are engaged.

E.2.2.     Consideration

55    The Company’s jurisdictional challenge to the decision of the Industrial Magistrate raises for determination the interrelationship between s 545 and s 323 of the FW Act and more generally the extent to which s 323 of the FW Act has been used to enforce contractual underpayments.

56    As submitted by the Company, it can readily be accepted that there has been a deliberate decision by the legislature to confer on the Federal Court and the Federal Circuit and Family Court broader powers to grant relief, than an eligible State or Territory court, for contraventions of civil remedy provisions of the FW Act.

57    In contrast to s 545(3) of the FW Act, ss 545(1) and (2) of the FW Act provide:

(1)    The Federal Court or the Federal Circuit and Family Court of Australia (Division 2) may make any order the court considers appropriate if the court is satisfied that a person has contravened, or proposes to contravene, a civil remedy provision.

(2)    Without limiting subsection (1), orders the Federal Court of Federal Circuit Court and Family Court of Australia (Division 2) may make include the following:

(a)     an order granting an injunction, or interim injunction, to prevent, stop or remedy the effects of a contravention;

(b)     an order awarding compensation for loss that a person has suffered because of the contravention;

(c)     an order for reinstatement of a person;

(d)     an order requiring a person to comply, either wholly or partly, with a notice (other than an infringement notice) given to the person by an inspector of the Fair Work Ombudsman.

58    There are two interrelated differences between the power conferred on the Federal Court (or the Federal Circuit and Family Court), and an eligible State or Territory court. First, in order to enliven the power to make orders, the Federal Court need only be satisfied that a person has contravened, or proposes to contravene, a civil remedy provision. An eligible State or Territory court, however, must also be satisfied that the employer was required to pay an amount “under this Act or a fair work instrument”. Second, once the preconditions for making an order have been satisfied, the Federal Court may make any orders it considers appropriate, whereas an eligible State or Territory court may only order an employer to pay the amount to the employee that it was required to pay under the FW Act or a fair work instrument.

59    In my view, the two differences are interrelated because confining the power to grant relief to make an order for the payment of a specific amount necessarily requires an identification of the specific source of an entitlement to be paid that amount. Given the absence of any restriction on the ability of the Federal Court (or the Federal Circuit and Family Court) to grant relief, it was not necessary to introduce any additional specification for the exercise by those Courts of their powers under s 545 of the FW Act.

60    Section 323(1) of the FW Act provides:

323     Method and frequency of payment

(1)     An employer must pay an employee amounts payable to the employee in relation to the performance of work:

(a)     in full (except as provided by section 324); and

(b)     in money by one, or a combination, of the methods referred to in subsection (2); and

(c)     at least monthly.

61    Section 539 of the FW Act sets out the standing, jurisdiction and maximum penalties available with respect to applications for orders in relation to contraventions of civil remedy provisions. Item 10 of the table relevantly provides that in respect of a contravention of s 323, an employee has standing to apply to an “eligible State or Territory court”.

62    Section 323 of the FW Act falls within Div 2 – Payment of wages etc. of Pt 2-9 – Other terms and conditions of employment.

63    The Explanatory Memorandum to the Fair Work Bill 2008 (Cth) (EM) stated that Div 2 is “about the frequency and methods of payment of amounts payable to an employee in relation to the performance of work and allowable deductions from such amounts”.

64    The EM otherwise provides in relation to s 323 of the FW Act:

1279. Subclause 323(1) requires employers to pay employees any amounts payable to the employees in relation to the performance of work:

•    in full (except as permitted by clause 324);

•    in money (i.e. not ‘in kind’) by one, or a combination, of the methods referred to in subclause 323(2);

•    at least monthly.

1280. A modern award, enterprise agreement or contract of employment may provide for more frequent payment.

1281. Subclause 323(1) does not provide an exception from the requirement for at least monthly payment to deal with the situation where payment of wages falls due on a public holiday. In such a case, the employer would need to ensure that appropriate arrangements are put in place so that employees are paid before the public holiday.

1282. This subclause is a civil remedy provision under Part 4-1 (Civil remedies).

1283. The legislative note after this subclause makes clear that the payment rule covers a wide range of payments, where they fall due during the relevant payment period – including incentive-based payments and bonuses, loadings, monetary allowances, overtime or penalty rates and leave payments. However, the amounts referred to in this subclause would not include superannuation contributions or non-monetary benefits.

1284. Subclause 323(2) lists the methods by which payments may be made, which include cash, direct deposit or cheque. This would, for example, prohibit payment by store credit vouchers. Alternatively, if a modern award or an enterprise agreement provides a method of payment, this must be complied with (subclause 323(3)).

1285. This subclause is a civil remedy provision under Part 4-1 (Civil remedies).

65    In Murrihy v Betezy.com.au Pty Ltd (2013) 238 IR 307; [2013] FCA 908, Jessup J observed at [142]:

A significant innovation introduced by the FW Act was the imposition of an obligation upon a “national system employer” (such as each of the respondents was) to pay its employees amounts payable to them in relation to the performance of work in full at least monthly: s 323(1) of the FW Act. Thus the legislation picks up, amongst other things, entitlements arising under contracts of employment and gives statutory consequences to an employer’s failure to make good on them. In this respect, s 323(1) is a civil remedy provision.

66    In Murrihy, Jessup J considered that there was a contravention of s 323 where the respondents failed to pay the applicant’s commission entitlements under a commission agreement. His Honour said at [119]:

It was not suggested by the respondents that their failure to pay the applicant’s commission entitlements did not involve a contravention of s 323(1). It clearly was such a contravention. Pursuant to cl 3 of the 2009 commission agreement, and the corresponding provision in the 2010 commission agreement, commission ought to have been paid monthly and, as it happens, that corresponds with the least frequent basis of payment for which s 323(1) provides. Subject to any submissions I may receive from the parties, it appears that there was, therefore, a contravention of the section at the end of every month during which a commission entitlement arose.

67    In Association of Professional Engineers, Scientists and Managers, Australia, v Wollongong Coal Ltd [2014] FCA 878, Buchanan J considered, with respect to an application for summary judgment, whether s 323 of the FW Act could be relied upon as giving rise to a statutory obligation to pay amounts promised under contract.

68    The applicant in Wollongong Coal commenced proceedings in a representative capacity as an employee organisation, claiming that employees were entitled to contractual bonuses that had not been paid. The applicant claimed that the employees were therefore not paid “in full” as required by s 323 of the FW Act, and that the respondent had therefore contravened a civil remedy provision. The applicant claimed compensation for loss arising from the contravention.

69    The respondents sought to have the proceedings dismissed on the basis that the applicant had no reasonable prospects of success. The respondents submitted that s 323, read together with s 324 of the FW Act, reflects the former “Truck Act” provisions. The respondents relied on the following statement by the High Court in Construction, Forestry, Mining and Energy Union v Mammoet Australia Pty Ltd (2013) 248 CLR 619; [2013] HCA 36 at [45]:

It is tolerably clear from the terms of s 323(3), and is confirmed by the Explanatory Memorandum which accompanied the Bill for the Fair Work Act 2009, that s 323(1) addresses the same mischief addressed by “Truck Acts“ as they had by then come to exist in each State, that is, that an employee’s entitlement to payment for work might be compromised by an employer requiring the employee to accept some form of payment in kind of less value than the payment of money forgone …

(Footnotes omitted).

70    With respect to the construction of s 323 of the FW Act, Buchanan J observed:

28     I referred earlier to reliance by the respondents on statements by the High Court in Mammoet. It is certainly apparent, as the respondents contend, that ss 323 and 324 of the FW Act are intended to provide for matters dealt with in the Truck Acts — ie payment in money (not in kind), without unauthorised deductions, and with specific and reasonable periodicity.

29     However, that conclusion does not suffice to exclude the possibility that s 323 of the FW Act has an additional role to play.

30     The ordinary language of s 323 is apt to identify, and provide for the enforcement of, an obligation to pay amounts which have become payable, as well as the more specific obligation to pay such amounts in full, in money and at least monthly (subject to the statutory exemptions which accompany the obligation). It does so by permitting the imposition of a civil penalty for contravention of the obligation.

31     The applicant does not rely on s 323 as a foundation for recovery of any underpayment. It relies on s 323 to establish breach of a civil remedy provision. Recovery of unpaid amounts is sought on a different statutory footing under s 545 of the FW Act, namely compensation for loss suffered as a result of contravention of a civil remedy provision.

32     The applicant’s construction of s 323 has direct support in the judgment of Jessup J in Murrihy.

33     Although the construction of s 323 argued by the applicant appears not to have been contested in Murrihy, it appears clear that Jessup J also subscribed to it…

71    His Honour therefore concluded that it could not be said that the applicant had no reasonable prospects of success, and at [36]:

[I]t seems to me that I should approach the question of construction of s 323 in conformity with the views expressed by Jessup J. I should do so as a matter of comity in any event, but I also regard the language of s 323 as sufficiently wide to accommodate the present proceedings. I do not accept the more confined construction advanced by the respondents.

72    Justice Buchanan thus accepted that s 323 of the FW Act could give rise to a statutory foundation for the imposition of a civil penalty with respect to the payment in full of amounts which have become payable pursuant to contractual arrangements, and that s 545 provided a statutory basis for a claim to recover unpaid amounts by way of compensation for loss suffered arising from a breach of a civil remedy provision.

73    A similar observation was made with respect to s 323 of the FW Act by Bromberg J in Australian Education Union v State of Victoria (Dept of Education and Early Child Development) (2015) 239 FCR 461; [2015] FCA 1196. His Honour said at [265]:

The right to receive monies deducted without authority will have vested with an employee as at the time that those monies were payable. In that situation, the employee would have a legal claim to the recovery of the underpayment. That claim may be statutory, contractual or both. Section 323(1) operates upon an existing obligation on the employer to pay. But it also imposes a further statutory obligation to pay in full, in money and at least monthly (except as provided for by s 324): Association of Professional Engineers, Scientist and Managers, Australia v Wollongong Coal Ltd [2014] FCA 878 at [28]–[33] (Buchanan J); and Murrihy v Betezy.com.au Pty Ltd (2013) 238 IR 307 at [142] (Jessup J).

74    In Association of Professional Engineers, Scientists and Managers Australia v Bulga Underground Operations Pty Ltd [2019] FCA 1960, Wigney J accepted that amounts payable to an employee under s 323 of the FW Act include leave entitlements due to the employee under the Coal Mining Industry (Long Service Leave) Administration Act 1992 (Cth):

115     Mr Mayhew and the Association sought declarations that Bulga breached s 323(1) of the Fair Work Act and s 39CB(2) of the Long Service Leave Act by failing to pay Mr Mayhew the full or correct amount payable to him in respect of long service leave upon termination.

116     Section 323(1) of the Fair Work Act relevantly provides that an employer must pay an employee amounts payable to the employee in relation to the performance of work “in full”. While Bulga initially submitted that s 323 did not apply to underpayments on termination under the Long Service Leave Act, it ultimately did not press that submission and appeared to concede that amounts payable to an employee upon termination under the Long Service Leave Act were “amounts payable to [an] employee in relation to the performance of work” for the purposes of s 323 of the Fair Work Act. It certainly did not submit otherwise.

117     That apparent concession by Bulga was properly made. The amounts payable to an employee referred to in s 323(1) include leave payments. In Stratton Finance Pty Ltd v Webb [2014] FCAFC 110; 314 ALR 166, the Full Court effectively approved declarations of contravention of s 323 of the Fair Work Act that related to the failure by an employer to pay the full amount due to an employee in respect of accrued but untaken annual leave on termination of employment. There is no reason to suppose that amounts payable to an employee under the Long Service Leave Act in respect of accrued but untaken long service leave would not also be covered by s 323(1). Bulga did not submit otherwise.

118     As noted earlier, s 39CB(2) of the Long Service Leave Act specifically provides for the amounts payable to an employee in respect of untaken long service leave when the employee’s employment ceases by reason of redundancy.

119    For the reasons already given, Bulga failed to pay the amount properly due to Mr Mayhew in respect of long service leave upon the termination of his employment. It accordingly contravened both s 323(1) of the Fair Work Act and s 39CB(2) of the Long Service Leave Act.

75    In my view, the conclusion that s 323 imposes a further statutory obligation to pay an amount due in full, whether the amount was payable under statute or contract or otherwise, is consistent with the natural and ordinary meaning of the text of s 323, its interrelationship with s 545 and a beneficial construction given the remedial and protective objectives of the civil penalty provisions in the FW Act in promoting the public interest in compliance: Australian Building and Construction Commissioner v Pattinson (2022) 274 CLR 450; [2022] HCA 13 at [15], [31] and [42].

76    It is necessary, however, to acknowledge that in Murrihy, Wollongong Coal and Bulga Underground Operations, the Court did not have to grapple with the additional hurdle imposed by s 545(3) of the FW Act for eligible State and Territory courts. The Court in each of those cases proceeded on the basis that compensation for loss could be ordered under s 545(2)(b) of the FW Act. An eligible State or Territory court however, is only empowered to order that an amount be paid to an employee where it is satisfied that the employer was required to pay that amount under the FW Act or a fair work instrument.

77    The Company placed significant reliance on the reasoning of the plurality of the Full Court of this Court in Qantas Airways Ltd v Flight Attendants’ Association of Australia (2020) 282 FCR 243; [2020] FCAFC 227 at [67]-[68] (Jagot and Wheelahan JJ) to submit that s 323(1) did not have the effect of creating any standalone payment obligation under the FW Act for the purposes of s 545(3), and therefore there was relevantly no amount that the Company was required to pay under the FW Act or fair work instrument, as the obligation to pay arose under contract.

78    The Full Court in Qantas Airways was concerned with the interpretation of s 789GDA(2) of the FW Act, which was inserted into the FW Act as part of the JobKeeper scheme. Section 789GDA(2) contained the same text as in s 323, namely “amounts payable to the employee in relation to the performance of work”.

79    The plurality said at [67]:

The very word “payable” in s 789GDA(2), in our view, necessarily calls up for consideration the question of the source of the obligation to pay. In common with s 323(1) of the Fair Work Act, the source of the obligation to pay is in the contract or industrial instrument which both statutory provisions pre-suppose govern the liability or requirement on the employer to pay.

80    Their Honours continued at [68]:

[T]he fact that subs 789GDA(2)(b) was copied from s 323(1) (including the copying over and adaptation of Note 2 to s 323(1)) takes on significance. It indicates that it is unlikely that Parliament intended that the same phrase in the two sections have a different meaning. The phrase “amounts payable to an employee in relation to the performance of work” in s 323(1) of the Fair Work Act does not mean the amounts earned by the employee. Nor does it mean the amounts earned by and payable to the employee. It means only that the employer is liable to pay the amounts to the employee. The amount to be paid and the time at which payment must be made are not regulated by s 323(1) (other than the requirement that employees be paid at least monthly). They are regulated by the applicable contract or industrial instrument.

81    Their Honours subsequently noted at [72] that s 323 is not concerned with when work is performed, but rather payment assumed to be regulated by a contract or industrial instrument.

82    I do not understand, however, any of the reasoning of the plurality to contradict the observation made by Bromberg J in Australian Education Union at [265]. The source, as in the origin of the obligation to pay, together with the specific amount to be paid and the time for payment, other than at least monthly, may well be found in a contract, not a discrete provision of the FW Act, but that does not preclude the imposition of a statutory obligation in s 323 to pay the contractual amount in full, in money and at least monthly. As the plurality stated in Qantas Airways at [7], after considering calculations undertaken by the appellant and the respondent of the amounts payable under the different constructions of s 789GDA(2) that they had propounded:

As the above examples make apparent, all three constructions assume that outside of s 789GDA(2) the employer is subject to an obligation to pay the employee wages. This is correct given the terms of s 323 of the Fair Work Act which provides that an employer must pay an employee amounts payable to the employee in relation to the performance of work in full, in money and at least monthly (further reference will need to be made to s 323 below).

83    Although in dissent in the ultimate result in Qantas Airways, the following statements made by Bromberg J at [97]-[98] are consistent with the statement by the plurality at [7] and expand upon his Honour’s earlier statement in Australian Education Union at [265]:

97     Section 323(1) does not identify the amount of money payable to the employee. That is left to the contract or relevant industrial instrument. Section 323(1) does, however, regulate when that amount is to be paid on the assumption that a periodic payment will be made for the performance of work. It does that by providing for the outer permissible temporal limit by which an amount payable in relation to the performance of work must be paid to the employee. The outer temporal limit is a month, meaning that all work performed by an employee must be paid for within the period of one month after its performance. The expression “at least monthly” acknowledges that a shorter period may be imposed by a contract or an industrial instrument and, if that is so, the shorter period will apply. The provision contemplated that (unless made earlier and in advance of the performance of the work), a payment in arrears must be made by the end of a period, for work performed during that period.

98     What that analysis reveals is that the amount that must be paid to the employee under s 323(1) is referable to the performance of work in the period prior to the time the payment falls due. The relevant period will be defined by the outer temporal limit applicable, either a month or some shorter period imposed by the relevant contract or industrial instrument. Section 323(1) imposes an obligation to pay in respect of a liability referrable to the performance of work performed in a particular period and not merely in respect of the performance of work whenever performed. If that was not so, the very purposes of the provision – that work performed must be paid for within the limited period allowed – would be defeated.

84    An expansive view of the scope of s 323(1) was also taken by White J in Augusta Ventures Ltd v Mt Arthur Coal Pty Ltd (2020) 283 FCR 123; [2020] FCAFC 194, consistently with the statements made in Qantas Airways by Bromberg J at [97]-[98] and the plurality at [7]. His Honour stated at [98]:

It is not necessary to note the various provisions in the FW Act, the industrial award or the enterprise agreements on which the group members’ claims in each proceeding are based but it is pertinent to note that s 323(1) of the FW Act requires an employer to pay an employee amounts payable to the employee in relation to the performance of work in full (subject to some exceptions which are presently immaterial) and at least monthly. As is noted by the authors of Creighton & Stewart’s Labour Law, Sixth Edition, The Federation Press at [15.59]:

Once an employee has accrued wages, the employer is obliged to make the payment. If the wages are due under an award, enterprise agreement or statute, then, in the absence of any provision to the contrary, this obligation is absolute in character.

85    I therefore do not consider it to be inconsistent with the reasoning of the Full Court in Qantas Airways, that while the source of the obligation to pay may be founded elsewhere, s 323 of the FW Act nonetheless imposes a further statutory obligation to pay an amount in full, in money and at least monthly, consistent with the observations of Jessup J in Murrihy and Bromberg J in Australian Education Union, as well as the remedial and protective objectives of the FW Act.

86    I am therefore satisfied that the Industrial Magistrate did have jurisdiction to make the orders on 17 August 2022, on the basis that her Honour was satisfied that the Company was required to pay an amount to Mr Cannon under s 323 of the FW Act, and contravened s 323 of the FW Act in failing to pay the amount.

87    For the foregoing reasons, Ground 4 has not been established.

E.3.     Ground 2

E.3.1.     Overview

88    Ground 2 was set out in the notice of appeal as follows:

The Magistrate erred in finding on the evidentiary material that the Appellant did not have any evidentiary material of real substance demonstrating that there was a serious question to be tried or the existence of a genuine dispute about the Respondent’s claim, in circumstances where the evidence was:

(a)     The Respondent agreed to deductions from salary in an email to the Appellant on 22 August 2017;

(b)     The terms of the Contract on 9 November 2017 specified that the salary of $68,000.00 and that this contract according to its terms only became operative when the Respondent obtained a subclause 457 visa; and

(c)     The Respondent obtained a 457 visa on 3 December 2018.

89    Ground 2 raises two issues for determination.

90    First, whether there was a serious question to be tried as to whether there was an oral agreement, as alleged by Mr Cannon, that he was to be paid the increased salary of $68,000 after he completed a 3 month probation period, being from 21 April 2017 (first issue).

91    Second, whether there was a serious question to be tried with respect to the Company’s claim that it was not liable to pay the increased salary from 3 December 2018 (when Mr Cannon obtained his subclass 457 visa and the terms of the written contract took effect), on the basis of the Company’s claim that it had made cash loans to Mr Cannon and the increase in salary was offset against Mr Cannon’s repayment obligations under those cash loans (second issue).

E.3.2.     Relevant principles

92    It is well established that a party should only be denied the opportunity to proceed in the ordinary way and after taking advantage of the usual interlocutory processes, if there is a high degree of certainty about what the outcome would be should the matter go to trial: Agar v Hyde (2000) 201 CLR 552; [2000] HCA 41 at [57] (Gaudron, McHugh, Gummow and Hayne JJ).

93    The most cogent consideration in setting aside a default judgment regularly entered, is therefore whether the defendant or respondent has a prima facie defence on the merits: Crayden v Ottaviano [2003] WASCA 20 at [16] (Templeman J, Murray J and Rolfe AJ agreeing).

94    It is not often that a defendant or respondent who has an apparently good ground of defence would be refused the opportunity of defending, even though a lengthy period of time has elapsed, provided that no irreparable prejudice is done to the plaintiff or applicant: Crayden at [16] quoting National Mutual Life Association of Australasia Ltd v Oasis Developments Pty Ltd [1983] 2 Qd R 441 at 449 (McPherson J).

E.3.3.     The Company’s submissions

95    The Company submits that a higher standard applied than that applied by the Industrial Magistrate, in that there needed to be “a high degree of certainty” about what the outcome would be should the matter go to trial.

96    The Company submits that such a level of certainty could not have been reached, and points to there being at least two serious questions to be tried on the evidence.

97    As to the existence of the first question, the Company submits that there was a serious question to be tried as to the existence of a term that the Company was to pay Mr Cannon at the higher salary of $68,000 per annum prior to December 2018, and that the Industrial Magistrate erred in finding otherwise and effectively reversed the onus by requiring the Company to disprove the alleged oral contract.

98    The Company submits that the evidence before the Industrial Magistrate gave rise to competing versions of when the appellant became obliged to pay Mr Cannon the increased salary of $68,000 per year. The Company submitted that the Industrial Magistrate’s approach assessed the competing evidence against the wrong standard, and wrongfully drew an inference when the Industrial Magistrate found “in the absence of any evidence from the Perth branch manager, it would be extraordinarily difficult to prove that no such oral contract was made”.

99    The Company submits that it did not bear the burden of disproving the oral contract, it was Mr Cannon who bore the burden of proving it.

100    The Company further submits that Mr Cannon’s evidence was “far from determinative of the issue”. His account of a conversation with the Perth branch manager in 2017 was unsupported by any documentary or circumstantial evidence and contradicted by the email dated 19 January 2017 and the pay records.

101    As to the second issue, the Company submits that there was a serious question to be tried with respect to the Company’s claim that it was not liable to pay the increased salary from 3 December 2018 to 3 February 2020 because Mr Cannon had borrowed money from the Company and was paying this back by foregoing wages. It submits that the absence of any record of the cash payments is because of a ransomware attack on the Company in October 2019.

102    The Company submits that the Industrial Magistrate erred in finding that there was “no evidence” to support the Company’s contentions with respect to the loans. The Company submits that the signed witness statements of Mr Soghomonian and the Company’s CFO, Kushan Jayarathne, together with the letter from Mr Jayarathne to the Industrial Magistrates Court dated 21 September 2021 supported the Company’s contentions in relation to the existence of the loans and the agreement by Mr Cannon to the deductions from his salary. The Company submits that the state of the evidence on this issue revealed a serious issue to be tried, and the Industrial Magistrate erred in finding otherwise.

103    The Company also submits that the Industrial Magistrate erred in placing any weight on the absence of any record of cash payments in the bank statements provided by Mr Cannon because they were heavily redacted and there could not be any expectation that cash payments would necessarily have been deposited into a bank account.

E.3.4.     Mr Cannon’s submissions

104    As to the first issue, Mr Cannon submits that his starting salary of $50,000 per annum was to be increased after the first 3 months of his employment, during which he was on probation. He submits that his probation period ended satisfactorily on 21 April 2017, and there was an oral agreement thereafter that his salary would be $68,000 per annum.

105    Mr Cannon submits that on that basis from 21 April 2017, his salary was to be $68,000, and in circumstances where he was only ever paid at the annual rate of $50,000 per annum, he was underpaid. Mr Cannon submits that the Company did not produce any evidence to refute the oral agreement relied upon.

106    As to the second issue, Mr Cannon submits that in the absence of a written authority the alleged deductions made from his salary would have been inconsistent with s 324 of the FW Act and his denials of any cash loans should be accepted. He submits that the absence of any notation on his payslips of any deductions gives rise to an inference that the cash loans explanation for the failure to pay his salary in full was of recent origin and only raised after he commenced the proceedings in the Industrial Magistrates Court.

107    Mr Cannon submits that the Industrial Magistrate adopted an orthodox approach and followed the appropriate authorities. He submits that the Company had to establish that there was a high degree of certainty that its defence to “what was nothing more than wage theft” would be successful at trial, and that it did not do so before the Industrial Magistrate.

E.3.5.     Consideration

108    I am satisfied that the Industrial Magistrate erred in finding that the Company had failed to establish the existence of a serious question to be tried with respect to the first issue.

109    The Industrial Magistrate determined that the first issue did not give rise to a serious question to be tried on the principal basis that the Company had not led any evidence from its Perth branch manager, identified as “Garvie”, disputing the existence of the oral contract alleged by Mr Cannon.

110    Mr Cannon gave evidence that he had negotiated a verbal contract with Garvie that he was to commence working for the Company on 19 January 2017 on a probationary basis for three months on a salary of $50,000 per annum plus superannuation, and on the completion of that period on 20 April 2017 his salary would increase to $68,000 per annum plus superannuation.

111    In my view, the absence of any evidence from Garvie disputing the existence of the alleged oral agreement provides significant, but not decisive, support for the Industrial Magistrate’s finding that the Company had not advanced any evidentiary material of real substance demonstrating that the first issue raised a serious question to be tried.

112    I am not satisfied, however, that there was a high degree of certainty that the Company would not succeed on the first issue, for the following reasons.

113    First, the alleged agreement was entirely oral with no contemporaneous documents suggesting that it included any term that Mr Cannon’s salary per annum would increase to $68,000 after the three month probation period.

114    Second, Aron Soghomonian, the Chief Operating Officer of the Company in an internal email to “Payroll” confirmed that “I have hired a new sales person for our Perth branch” on 19 January 2017 and he had engaged Mr Cannon “on trial for 3 months on 50k gross + super as full time Monday to Friday 8-5”. Mr Soghomonian, however, made no reference in his email to any increase in salary at the conclusion of the trial. Further, the email suggests that the engagement of Mr Cannon was undertaken by Mr Soghomonian, not Garvie.

115    Third, the Company’s written letter of offer dated 9 November 2017 that was signed by Mr Cannon stated that the “commencing salary” of $68,000 would only become operative upon the grant of Mr Cannon’s subclass 457 visa, in circumstances where the Company’s payroll records demonstrate that in the period up to the grant of Mr Cannon’s visa in December 2018, his annual salary remained at $50,000.

116    Fourth, establishing the terms of oral contracts can be challenging, particularly when they might be thought to be alleged to contain terms agreed in subsequent written contracts or where their existence is not supported by the apparent logic of events or any contemporaneous objective evidence.

117    For the foregoing reasons, I am satisfied that the first issue with respect to Ground 2 has been established.

118    I am satisfied, however, that the Industrial Magistrate did not err in finding that the Company had failed to establish the existence of a serious question to be tried with respect to the second issue.

119    The Industrial Magistrate provided the following reasons for finding that that second issue did not give rise to a serious question to be tried:

The company appears to be alleging that the contract prepared in November 2017 was simply drafted as a formality or a favour in order to secure a working visa for the claimant, rather than being a formal contract between the parties. Finally, the company alleges that the claimant borrowed large sums of money from the company, such that the company deducted these payments from the claimant prior to the payment of his fortnightly salary, and the company alleges that this was done with the consent of the claimant.

Apart from an email exchange, where the claimant agreed to the deduction of $200 per fortnight related to the legal fees for the visa, there has been no evidence filed that supports the proposition, firstly, that the claimant borrowed large sums of money, and secondly, that he agreed to have those sums deducted from his pay. In addition, those alleged deductions do not appear as they are required to be, if, in fact, they occurred, detailed on the employee payslip. The payslip filed by the claimant, and also filed by the respondent company, do not show any deductions at all, which, should the Court be satisfied the deductions were made, they should have been. And, indeed, the company does not deny that they were made, therefore, the failure to include those deductions on the payslip is a clear contravention of the Fair Work Act.

The respondent company has filed no documentary evidence in support of its alleged defence to the non-payment of the wages and the super. According to a letter, annexed as “F” to the respondent’s further and better particulars and addressed to the Court, and also, provided as part of the copies of records provided by the respondent company, Mr Jairathne alleges that much of the company’s evidence was unable to be retrieved due to an alleged ransomware attack on the company’s entire network in October 2019. In his letter, he attached correspondence related to the alleged attack, which shows nothing other than a quote. Within the quote, there is no reference to the compromise of any human resource files. Given that no other documents or witness statements have been filed, it appears that the sole evidence to be relied upon by the respondent company is that of Mr Jairathne and Mr Sogmonian.

The claimant wholly denies that he ever borrowed money from the respondent company and has filed and served all relevant bank statements for the employment period. None of those statements reveal any large sums of money transferred to the employee by the company. The statements reveal that the company continuously paid the claimant his fortnightly wage at a rate of $50,000 per annum gross for the entire employment period.

Putting aside for a moment, the proposed defence to the claim, and without making any specific findings of fact, it is clear, from the papers, that should the matter proceed to trial, it’s likely that evidence will emerge that demonstrates possible liability on the part of the company, pursuant to the sections of the Migration Act.

In addition, without considering the illegality of undocumented unilateral deductions from salary that don’t appear on a payslip, the company has no documentary evidence to support the proposition that the claimant borrowed any large sums of money, nor does it appear that the company will be able to present any cogent evidence that Mr Cannon agreed in writing to any deductions, other than the $200 fortnightly, to repay the legal fees associated with the grant of the visa. Since migration legislation does not allow for such a deduction to be made, that was not a deduction that could be authorised under the Fair Work Act. There is no defence to that portion of the claim.

120    I am satisfied that there was a high degree of certainty that Mr Cannon would succeed on the second issue if the second issue had gone to trial.

121    I accept that the absence of any evidence of cash payments being deposited in the redacted bank statements provided by Mr Cannon is of limited probative value and the witness statements of Mr Jayarathne and Mr Soghomonian, and the letter written by Mr Jayarathne, provide some support for the Company’s contentions in relation to the cash loans. Their evidence and the letter, however, does not rise above ex post facto assertions of loans and consents provided by Mr Cannon entirely divorced from and not supported by any contemporaneous documents. Moreover, the Industrial Magistrate’s reasons must be read in context. Her Honour expressly referred to the evidence of Mr Jayarathne and Mr Soghomonian in the same paragraph of her reasons in which she stated that the Company had filed no “documentary evidence” in support of its alleged defence to the non-payment of wages.

122    The email from Mr Cannon to ‘Payroll”, copying in Mr Soghomonian, sent at 12.30 pm on 22 August 2017 does not assist the Company. It is readily apparent from the subject line of the email “RE: Email Daniel Cannon 25 July 2017 – Cost invoice” that it relates to the cost invoice dated 25 July 2017 from York Immigration Services addressed to the Company in an amount of $5,430.67 with respect to Mr Cannon’s visa application. The agreement by Mr Cannon, recorded in the email, to pay $200 each pay day until his visa was obtained, at which time “we will look at increasing it to get it cleared quicker” could only plausibly have been a reference to the repayment of the York Immigration Services Invoice. It clearly was not an agreement to repay any alleged cash loans in that amount or any other amount.

123    Rather, the 22 August 2017 email reinforces the extent to which the cash loans explanation in the 21 September 2021 letter to the Industrial Magistrates Court for the deductions are an ex post facto attempt to justify the deductions. The letter included the following purported explanation:

Further to the request from our legal counsel, Mr. Atul Chadha, I would like to confirm the total outstanding from Mr. Daniel Cannon from the beginning of his employment and the reason for fortnightly deductions of $200 from his salary payments and the difference between what has been paid vs what was offered in the letter of offer dated 07 November 2017 from 03 December 2018 until 19 February 2020.

As per the information received from Sales Director/COO, Ara Soghomonian, Mr. Cannon has borrowed cash in few tranches during his employment totaling $22,400.00. In addition, he has also agreed to reimburse some of the legal fee incurred by the Company on behalf of his visa application process. Enclosed please find a copy of the Tax Invoice from York Immigration Services amounting to $5,430.67. He has agreed to deduct this from his salary from fortnightly instalments of $200.00 and the evidence of his acceptance was provided with the previous correspondence. Until the last date of his employment, the Company has managed to recover a total sum of $5,400.00.

The difference between employment offer letter issued for his visa subclass 457 with an increased salary amount of $68,000per annum effective from 03 December 2018 (date of subclass 457 visa was granted) and what has been paying ($50,000 per annum) him to offset his debts to the company was $21,846.58.

Therefore, he still owes to the Company an amount of $584.09.

124    The letter illogically attempts to rely on the $200 repayment commitment made by Mr Cannon with respect to the York Immigration Services invoice to substantiate the existence of the cash loans to him and his alleged agreement to the loan repayment deductions.

125    I note that the Industrial Magistrate’s finding that there was no defence to Mr Cannon’s claim that the fortnightly deductions of $200 by way of repayment of legal fees associated with obtaining Mr Cannon’s subclass 457 visa were unlawful, was not challenged in this appeal.

126    The absence of any written documentation substantiating the existence of the alleged cash loans, combined with the denials of Mr Cannon and the inherent implausibility of the arrangement given (a) its inconsistency with the terms of Mr Cannon’s employment contract that was provided by the Company to the Department to secure the grant of Mr Cannon’s subclass 457 visa, (b) the alleged deductions by way of repayment of the alleged cash loans which, if made, would have been inconsistent with s 324 of the FW Act, given the absence of any written authorisation from Mr Cannon, and (c) as the Industrial Magistrate noted, the deductions were not recorded on Mr Cannon’s payslips contrary to the requirement in reg 3.46(2) of the Fair Work Regulations 2009 (Cth) and thereby would have constituted a contravention of s 536(2) of the FW Act, provide compelling support for the finding by the Industrial Magistrate that the second issue did not give rise to any serious question to be tried.

127    I am not persuaded that the absence of any evidence of any contemporaneous written complaint by Mr Cannon that he was not being paid the agreed salary of $68,000 or the alleged ransomware attack relevantly diminish the high degree of certainty that Mr Cannon would succeed on the second issue. Mr Cannon’s evidence, that the absence of any written complaint was attributable to the vulnerability of his immigration status and his dependence on the Company as his sponsor for his subclass 457 visa is persuasive and consistent with the apparent logic of events.

128    Similarly, the relevance of the evidence advanced by the Company of a ransomware attack in late 2019 is not apparent. The evidence does not extend to any confirmation of the loss of any records of cash payments and more importantly no evidence was advanced by the Company as to the nature or type of records of cash payments that might have been lost because of the ransomware attack. Nor, significantly can any ransomware attack in October 2019 explain the absence of any records of cash payments or repayments after that date.

129    For the foregoing reasons, the second issue with respect to Ground 2 has not been established.

F.     Disposition

130    The appeal is to be allowed but only insofar as it concerns whether there was a serious question to be tried as to whether there was an oral agreement, as alleged by Mr Cannon, that he was to be paid an increased salary of $68,000 after he completed a 3 month probation period, being from 21 April 2017. The appeal is otherwise to be dismissed.

Associate:

Dated:    30 July 2024