The general protections of the Fair Work Act deal with prohibited or unlawful conduct in the sense that a breach of them, if established, constitutes a contravention of the law. This is to be contrasted with unfair dismissal, for which the Act allows a remedy without providing that an unfair dismissal is a contravention of the Act and thus unlawful.
In the same vein, the Act exposes individuals who are involved in a contravention, for example managers and directors of a company which is found to have acted in contravention of the general protections to be personally liable for the consequences to a victim, for example an employee who suffers adverse action for a prohibited reason.
The following extract from a recent decision of the Federal Circuit Court of Australia deals with the principles which apply to this area of liability, which is often called “accessorial liability”.
“Relief was sought against Mr Shen and Mr Baker on the basis that they were liable as accessories.
One of the important issues in this case was the nature of the second and third respondents’ liability. It was alleged to have been accessorial. The first respondent was the primary actor in the events, at least at a level consonant with proper legal personality. In other words, the applicant’s employer in law was the first respondent. It was true that the third respondent was the guiding mind and a controlling influence of the first respondent. Nevertheless, according to basic principles of the company law the first respondent was the separate legal entity the existence of which was independent of its corporator. That proposition is so entrenched in Anglo Australian jurisprudence that authority for it need not be cited. Lest authority is required, I have applied the reasoning in Salomon v Salomon & Co Ltd, Gas Lighting Improvement Co Ltd v Inland Revenue Commissioners, Australasian Temperance and General Mutual Life Assurance Society Limited v Howe, Hobart Bridge Co Ltd v Federal Commissioner of Taxation, Multinational Gas & Petrochemical Co v Multinational Gas and Petrochemical, Adams v Cape Industries Plc, Meridian Global Funds Management Asia Ltd v Securities Commission, Sons of Gwalia (Subject to Deed of Company Arrangement) v Margareticand New South Wales v The Commonwealth.……………….. One of the most useful explanations of the separate entity doctrine in company law was given by Isaacs J in Howe. There, his Honour held as follows –
A corporation once created is by common law a “person” (see Royal Mail Steam Packet Co. v. Braham (1); Pharmaceutical Society’s Case (2); Grant on Corporations, p. 4 (n.), and Foote on Private International Jurisprudence, 4th ed., p. 125). This is one of the most deeply rooted doctrines of our law (Coke’s Institutes, 2 Inst., 722) and it is the starting-point from which the Courts in England, basing themselves purely on the common law, have by its beneficial flexibility kept abreast in the case of corporations of the general advance of a progressive society.
 (1922) 31 CLR 290, 301
A helpful analysis of the principle is given in the most recent addition of Davies & Worthington, Gower & Davies’ Principles of Modern Company Law and following.
 (Sweet & Maxwell, 7th ed, 2003) 93
It is necessary to separately consider the liability of each.
Mr Shen was at all relevant times the guiding mind of ACA. ACA did nothing of significance unless authorised by Mr Shen. Mr Shen hired staff. He dismissed staff. He made important decisions. He left unimportant decisions in respect of operational issues to Mr Baker. Mr Shen was the relevant decision‑maker in this case. I entertain no doubt whatsoever that Mr Shen was an accessory to the contravention that I found above.
Mr Baker fell into a wholly different category. While he gave his occupation as operations manager, it was readily apparent that his authority within ACA was extremely limited. He may have had a say, even a significant say, in the operations of the factory but important decisions were squarely the preserve of Mr Shen. I do not accept that Mr Baker had any effective role in the employment or termination of the applicant. Mr Baker did have a role in the day‑to‑day discharge of the applicant’s tasks although that is not relevant to this proceeding.
In my judgment, accessorial liability should follow in respect of Mr Shen. However, it should not follow in respect of Mr Baker. I do not accept the contention of counsel for the applicant that Mr Baker was implicated on an accessorial liability basis merely because he completed the fair work form. Accessorial liability travels well beyond that as the authorities cited above bear out.
The further conduct of this case must deal with evidence and submissions that flow from there being a finding about Mr Shen’s personal liability for ACA’s contraventions.
I will adjourn this case to a date to be fixed.”
Butlin v ACA Home Improvements Pty Ltd (2018) FCCA delivered 5 December 2018 per Wilson J