Federal Court of Australia

Cropper v Energy Action (Australia) Pty Ltd (No 3) [2025] FCA 950

ORDERS

THE COURT ORDERS THAT:

1.    There be judgment for the applicant in the amount of $130,698.60, together with interest pursuant to s 51A of the Federal Court of Australia Act 1976 (Cth) and/or s 547(2) of the Fair Work Act 2009 (Cth), such interest to be calculated from 28 February 2020 at the rates referred to in paragraph 2.2 of the court’s Interest on judgments practice note (GPN-INT).

2.    The matter be listed for a case management hearing at 9:30am on Monday, 1 September 2025.

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

REASONS FOR JUDGMENT

SNADEN J:

1.    By judgment dated 23 June 2025, this court resolved questions concerning the liability of the respondent (“EAAPL”) to pay various sums to the applicant, Mr Cropper, in respect of his employment between 2006 and 2020: Cropper v Energy Action (Australia) Pty Ltd (No 2) [2025] FCA 663 (“Cropper”; Snaden J). The cornerstone of the case that Mr Cropper advanced—namely that he was, from 20 January 2006, a permanent employee of EAAPL’s—was found proved. I accepted that, during his engagement and upon its termination, EAAPL had failed to pay Mr Cropper certain entitlements that he was due.

2.    Mr Cropper’s hours of work with EAAPL were neither fixed nor agreed. Instead, he “worked the hours that he considered were necessary to deliver the work that he was engaged to perform”: Cropper, [52] (Snaden J). His hours and, therefore, his pay varied from week to week and month to month. In that context, it is more challenging than it might otherwise be to assess the amount of statutory compensation and damages to which Mr Cropper is entitled in respect of various unpaid (or underpaid) entitlements.

3.    Notwithstanding this difficulty, I made findings in Cropper regarding the quantum of compensation payable to Mr Cropper by EAAPL in respect of certain of EAAPL’s breaches of the Fair Work Act 2009 (Cth) (“FW Act”). In particular, I determined the amounts that were payable in respect of EAAPL’s failure to afford Mr Cropper paid personal/carer’s leave ($628.39) and to pay out his accrued but untaken annual leave on termination ($91,129.22).

4.    I declined, however, to make final orders as to relief. Instead, I invited the parties to provide supplementary submissions on two issues of quantum. The first concerns the statutory compensation payable in respect of EAAPL’s failure to afford Mr Cropper public holiday pay. The second concerns the calculation of Mr Cropper’s loss arising from EAAPL’s failure to afford him reasonable notice of his dismissal (or pay in lieu thereof).

5.    The parties have now had (and availed themselves of) that opportunity. They have each also filed affidavits, which are mostly chronological in nature. I have not had regard to that material. It was filed without leave and inconsistently with an exhortation recorded in the primary judgment: Cropper, [206] (Snaden J). In any event, the differences between the parties’ respective histories are not material.

6.    Presently, then, the tasks for the court are twofold: first, to assess the total quantum of damages and compensation; and second, to make related orders as to interest.

Damages and statutory compensation

7.    There are two components of Mr Cropper’s claims that remain to be quantified: the amount that he ought to have been paid in respect of public holidays; and the amount that he ought to have been in paid in lieu of notice of his dismissal. It is convenient to address each in turn.

Compensation for public holiday pay

8.    The first issue—being the quantum of statutory compensation for public holiday pay not provided to Mr Cropper—can be dealt with summarily. Mr Cropper and EAAPL have each endorsed the court’s suppositions (Cropper, [189]-[193] (Snaden J)) about how that amount ought to be calculated. In the result, $20,176.85 in compensation is payable to Mr Cropper in respect of EAAPL’s breach of s 114 of the FW Act.

Damages for breach of contract

9.    The parties remain sharply divided in relation to how to calculate the damages payable in respect of EAAPL’s failure to provide pay—or, more accurately, sufficient pay—in lieu of notice of Mr Cropper’s dismissal.

10.    Some context is warranted. The court has already concluded that the period of reasonable notice to which Mr Cropper was entitled was three months: Cropper, [166] (Snaden J). Upon the termination of his employment, EAAPL paid to Mr Cropper certain sums as a “gesture of good faith”, notwithstanding its view that, as a contractor, he was not entitled to them. Mr Cropper was relevantly paid $12,567.85 in lieu of notice and $30,162.85 by way of severance.

11.    Mr Cropper submits that the amount of damages to which he is entitled is the shortfall between the amount actually paid in lieu of notice and the amount of pay that he would have earned had he worked the three-month notice period to which he was entitled.

12.    The difficulty in assessing the value of the three-month notice period inheres in the variability of Mr Cropper’s working hours and the absence of any agreement about what they were. The focus of the enquiry is, therefore, upon the hours that Mr Cropper might be assumed to have worked had his employment continued in the three-month period following 28 February 2020 (being the date of his dismissal).

13.    In Cropper, I set out (at [204]) four different ways in which that question might defensibly be answered, each involving some form of extrapolation from the hours that Mr Cropper worked in the leadup to his dismissal. By their submissions, the parties each purport to identify additional or modified paths by which the court might address the question. The task for the court is to identify the “most defensible” calculation of the amount that, on the evidence, best reflects what Mr Cropper would have earned had he worked during the three-month notice period.

14.    EAAPL invites the court to find that that amount is zero. It submits that it was not obliged to afford Mr Cropper any work during the notice period, and that he would not have worked—or been paid—at all. That, it says, is a consequence of the reality that Mr Cropper was dismissed for reasons of redundancy, the genuineness of which was not challenged.

15.    Whether his dismissal was a case of genuine redundancy or not is a separate question from whether Mr Cropper would have had work to perform during his notice period. The evidence as to the latter is sparse (if there is any at all).

16.    The letter of dismissal that was given to Mr Cropper on 28 February 2020 stated (in part):

The purpose of this letter is to confirm that as a consequence of the Business Transformation Program going live, the Company no longer requires the services of a Senior Application Developer.

At your request, we reviewed our organisational structure and future IT needs and regretfully advise that the Company does not have any associated entities into which you could be assigned and nor does it have any suitable alternative positions available.

17.    That was consistent with discussions that EAAPL had with Mr Cropper at around the time of his dismissal. In his oral evidence-in-chief, Mr Cropper referred to a conversation had with his manager on 18 February 2020, wherein he was told words to the effect that “we’ve just gone live with the EnAct replacement system; therefore we don’t have any need for an Access developer any more so they’re terminating [your] contract”.

18.    There is no detail in the evidence before the court as to the timing of the rollout of the “Business Transformation Program” or the likely effect of that rollout on Mr Cropper’s workload. Notwithstanding that the EnAct system upon which Mr Cropper had worked was apparently being phased out, the evidence before the court records that Mr Cropper’s role was not always confined to that program. There is no evidence to support EAAPL’s submission that “the IT work had come to an end” and Mr Cropper does not make anything as clear as a concession in this regard. There is no explanation given by either party as to why Mr Cropper’s hours were lower in February 2020 and whether that was related to or foreshadowed a decline in his workload. Mr Cropper’s working reduced hours in a particular month was not without precedent. In those circumstances, EAAPL’s submission that Mr Cropper’s hours (and pay) for the notice period should be assessed as zero cannot be sustained.

19.    There is, then, no need to address the more fundamental question about whether, where an employee’s hours and salary solely depend on the demands of their role, the contractual obligation to provide notice (or pay in lieu thereof) can be rendered inutile if that employee has no work to perform for the notice period. It suffices to say that I am doubtful that a term entitling contractual termination upon notice would ever lack substance in the way for which EAAPL contends.

20.    In the alternative, EAALP submits that the court should assess Mr Cropper’s contractual damages by one of two of the potential methods that the court identified in Cropper: namely by extrapolating a hypothetical work pattern from Mr Cropper’s hours in the month prior to his dismissal; or, alternatively, by extrapolating from his working hours in the three months prior to his dismissal.

21.    I have already identified that the month preceding Mr Cropper’s termination was an outlier (albeit not wholly unique) in Mr Cropper’s overall work history. There is no evidence from which the court might properly infer that that quieter month foretold of similarly quiet months thereafter. Whilst it would be open to the court to adopt either of the alternative methods contended for by EAAPL, the court’s task remains to identify the method that most closely accords with what Mr Cropper was likely to have earned had he worked out his notice period.

22.    Mr Cropper invites the court to take account of the following when fixing the amount that EAAPL ought to have paid him in lieu of notice of his dismissal, namely:

(1)    his average hours of work in the preceding 12-month period (which he says yields a weekly average of 37.7 hours); and

(2)    the public holiday hours for which he was entitled to be paid over the same period (which he says together with the hours in sub-para (1) would yield an average of 38.93 hours per week).

23.    Notwithstanding the average identified in sub-para (2) above, Mr Cropper ultimately presses for the calculation of his loss based on the assumption that he would have worked 38 hours per week throughout his notice period.

24.    EAAPL seeks to impugn that approach on the basis that the court has already rejected Mr Cropper’s submission that he was employed on a full-time basis: Cropper, [181] (Snaden J). However, the point is put differently now: Mr Cropper’s submission proceeds on the basis of the average hours that he worked over a period, not on the factual premise that the parties had agreed that Mr Cropper was engaged on a full-time basis.

25.    I have already said (in Cropper, [204]) that it would be open to adopt a method that leverages Mr Cropper’s average hours over the preceding 12-month period. It is not clear to me why Mr Cropper has applied a ceiling of 38 hours, but, given the conclusions I reach below, it is unnecessary to say anything more about this.

26.    The evidence being limited as it is, I consider that it is preferable to assess Mr Cropper’s contractual loss by reference to his working hours over multiple years. Additionally, the evidence suggests that Mr Cropper was, at least in recent years, disposed to work more hours in certain months compared to others. That being so, I consider that it would be preferable to compare Mr Cropper’s working hours in the months specific to his notice period (March, April and May).

27.    Those observations made, I consider that Mr Cropper’s contractual loss is equal to what he would have been paid for the number of hours of work equal to the average of his working hours in the relevant months (March, April and May) of prior years.

28.    Before proceeding with that analysis, something should be said about the second aspect of Mr Cropper’s calculus (above, [20]). There is no reason not to take account of public holidays in establishing Mr Cropper’s working hours. EAAPL has not advanced any and the analysis that follows proceeds on that basis.

29.    On the strength of the observations recorded above, Mr Cropper was entitled to be paid a total of $31,331.99 in lieu of his three-month notice period. That figure is reached by:

(1)    adding Mr Cropper’s working hours over the period of March to May in 2017, 2018 and 2019 (488.25, 441 and 429 respectively), together with the public holiday hours for each of those three-month periods (20.6375, 19.65 and 22.4875 respectively) (see Cropper, Schedule 1);

(2)    dividing the resultant figure (1,421.025) by three to generate an average for those months over the three years in question; and

(3)    multiplying that figure (473.675) by Mr Cropper’s rate of pay ($66.1466).

30.    One further issue remains to be addressed: namely, how the sums that were paid to Mr Cropper upon his dismissal should bear upon the calculation of his contractual loss. It is common ground—and, in any case, it is appropriate—that the damages to be awarded should be reduced by the amount that EAAPL paid Mr Cropper in lieu of notice of his dismissal. However, EAAPL submits that the sum paid in lieu of redundancy ought also to bear on the calculation. If that submission is accepted, EAAPL would not now be required to pay any damages to Mr Cropper for breach of contract.

31.    The position that EAAPL advances now represents a departure from a concession that it offered at the trial, namely that “redundancy pay would not be set off…because that is a separate entitlement”.

32.    In support of its current position, EAAPL relies on the following passage from Black v Brimbank City Council (1998) 77 IR 405 (“Black”), 422 (Moore J):

In my opinion, there is no reason in principle why severance payments should, in a case such as the present, not be brought to account in assessing damages even though the rationale for severance payments has been said to be, at least as a primary reason, not to provide income during a period of unemployment.

33.    The facts with which Moore J was confronted in Black were quite different to those of the present matter. There, Mr Black’s role had been made redundant, notwithstanding that an applicable industrial agreement served to prevent his employer from retrenching him at the particular time that he was dismissed. It was to the addressing of that wrong that damages were to be assessed. Importantly, had Mr Black been terminated lawfully (that is to say, after the moratorium on retrenchments and at the end of Mr Black’s fixed-term contract), he would not have been entitled to the redundancy payment. In those respects, there was a correspondence between the two amounts (the damages for breach of contract and the redundancy payment made by the employer). It was that reciprocity that authorised the offsetting to which Moore J referred. So much is apparent from Moore’s J reasons (at 505–7, my emphasis):

Brimbank’s liability for damages arises because, it is to be assumed for present purposes, it breached the contract of employment by terminating it other than in the manner contemplated by the contract itself. This act would expose it to damages which, prima facie, are the benefits Mr Black would have derived while employed for the residue of the contractual term. However, the act which constituted the breach was also the act that founded the entitlement of Mr Black to the payment of severance entitlements under the agreement. Had the contract not been breached by its premature termination and it had run its course and the employment terminated by the effluxion of time, there would have been no payment under the agreement.

The purpose of compensatory damages, whether in actions in tort or contract, is to place the injured party in the same position he or she would have been in had the contract been performed or the tort not committed … The payment of severance entitlements arose directly from the act which constituted the breach for which compensatory damages are now sought. It would, in my opinion, be inconsistent with the purpose for which compensatory damages are awarded to ignore the payment of severance entitlements directly arising from the act which constituted the breach when assessing damages flowing from it.

34.    That Black does not stand for the broader principle that EAAPL now seeks to advance is consistent with White’s J observations in Heldberg v Rand Transport (1986) Pty Ltd (2018) 280 IR 93, 115-6, [108]-[110].

35.    There is a more fundamental barrier to the set off for which EAAPL contends. It inheres in Mr Cropper’s separate entitlement to redundancy. EAAPL dismissed Mr Cropper because it no longer required him. That being so, Mr Cropper was entitled to 12 weeks’ redundancy pay under s 119 of the FW Act. So much was conceded at the trial and, with respect, rightly so. The proposition that EAAPL should be able to set off, against the damages for which it is liable in contract, the payment that it made on account of Mr Cropper’s redundancy cannot be accepted.

Conclusion

36.    Having regard to the statutory compensation payable in respect of unpaid personal leave, public holiday pay and annual leave entitlements due on termination, together with damages for breach of contract, judgment should be entered for Mr Cropper in the sum of $130,698.60.

Interest

37.    Damages and compensation having been calculated, Mr Cropper’s claim for interest should be accepted absent good reason not to: FW Act, s 547(2); Federal Court of Australia Act 1976 (Cth), s 51A.

38.    The parties jointly submit that the starting point for the calculation of interest should be the date of Mr Cropper’s dismissal (28 February 2020). There is no reason not to give effect to that joint position.

39.    EAAPL submits that some reduction ought to be applied to account for Mr Cropper’s delay in bringing his application. Specifically, it is said that no interest should be payable in respect of the period spanning 3 April 2020 (when Mr Cropper first issued a letter of demand to EAAPL) to 27 January 2021 (when he commenced this action). That delay, it says, was unreasonable to a point that warrants deviation from the usual course. Reliance is placed upon the observations of Halley J in Carter v Chubb Insurance Australia Ltd [2024] FCA 1464.

40.    I do not accept that any such deviation is warranted. This court has been clear about the purpose for which interest is awarded and the implications that attend a matter’s delayed prosecution: Qube Logistics (Rail) Pty Ltd v Australian Rail, Tram and Bus Industry Union (2021) 308 IR 39, 50 [63]-[64] (Bromberg, Katzman and O’Callaghan JJ); Roufeil v Tarrant Enterprises Pty Ltd (2023) 299 FCR 204, 222 [63] (Derington, Abraham and Jackman JJ). Mr Cropper has been denied the benefit of the sums to which he is entitled since those entitlements became payable. The purpose of interest is compensatory and delay (of itself) is not a basis upon which to reduce it. Mr Cropper is entitled to recover, by way of pre-judgment interest, the benefit that he would have had had the sums owed to him not been withheld.

41.    Section 570 of the FW Act likely precludes the court from making any order for costs; but, if I am wrong about that, Mr Cropper can inform my chambers. The matter will otherwise need to proceed further to assess what, if any, penalties should be imposed in respect of EAAPL’s contraventions of the FW Act; and, to that end, will be listed for case management.

Associate:

Dated:    14 August 2025