Unfair dismissal, reinstatement and lost pay

This dicta deals with the legal issue of when to order payment of lost pay in conjunction with an order for reinstatement of employment as a remedy for unfair dismissal. .

“Reinstatement – is it appropriate to make an order to restore lost pay?
[114] Section 391(3) of the FW Act provides that, if the Commission makes an order for
reinstatement and considers it appropriate to do so, the Commission may also make any order
that the Commission considers appropriate to cause the employer to pay to the Applicant an
amount for the remuneration lost, or likely to have been lost, by the Applicant because of the
dismissal.
[115] Section 391(4) of the FW Act provides that, in determining an amount for the purposes
of such an order, the Commission must take into account:
[2023] FWC 2032
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(a) the amount of any remuneration earned by the Applicant from employment or other
work during the period between the dismissal and the making of the order for
reinstatement; and
(b) the amount of any remuneration reasonably likely to be so earned by the Applicant
during the period between the making of the order for reinstatement and the actual
reinstatement.
[116] An order to restore lost pay does not necessarily follow an order for reinstatement. The
Commission may only make an order if it considers it appropriate to do so and only make an
order that the Commission considers appropriate.131 Where an employee has engaged in
misconduct, the Commission may refuse to make any order to restore lost pay.132
[117] I consider it to be appropriate in the circumstances to make an order to restore lost pay.
Such amount should take account of each of the matters referred to in s.391(4). Mr Lewin has
taken reasonable steps to mitigate his loss. He obtained comparable employment from 1 May
2023. His earnings should be taken into account in accordance with s.391(4)(a). I note that the
parties had indicated an intention to file Agreed Facts as to the employment of Mr. Lewin postdismissal.133 Mr. Comer had made only limited efforts to obtain further employment by the time
of the hearing. Ms. Philippe had not applied for alternative employment at the time of the
hearing. Ms. Philippe’s pregnancy may have impacted on her capacity to mitigate loss through
alternative employment. I consider that any amounts payable to Mr. Comer and Ms Philippe
should be reduced given the limited attempts to mitigate their loss. Given the conduct engaged
in by each of the Applicants that resulted in the terminations I also consider it appropriate to
reduce that amount otherwise payable to Mr. Comer and Ms. Philippe by an amount of 20%. In
the case of Mr. Lewin I consider it relevant that he was the only one of the Applicants who
stood to gain any benefit from the sales transfer and in his case the relevant amount should be
reduced by an amount of 35%.
[118] The parties are directed to confer and provide agreed orders as to the amount of lost pay
for each of the Applicants within seven days from the date of this decision. In the absence of
agreement, brief written submissions should be provided to enable me to determine the
appropriate amount to be included in any order.”

Comer and others v Rentokil Initial Pty Ltd [2023] FWC 2032 delivered 15 August 2023 per Roberts DP