By Stefan Chelper

14 July 2023

Established by the Australian government, the Fair Entitlement Guarantee (FEG) scheme provides financial support to eligible employees who have experienced job loss, unpaid wages, accrued annual leave, redundancy pay, and other outstanding entitlements due to their employer's insolvency.

Tisher Liner FC Law has been acting on behalf of one such ‘eligible employee’ over the past three (3) years. Our client, a real estate agent, found himself in the unfortunate situation of missing out on commission payments due to his employer falling into insolvency prior to the settlement of numerous off the plan apartments.

Our client sought solace in the FEG scheme, only to be greeted with a disappointing rejection. The reason? The properties he sought commissions for settled outside the wages entitlement period (i.e. the preceding 13 weeks up to the time that the person’s employment ended). Outrageous, right? We challenged this rejection on the basis that the relevant time to consider was the date that a property was sold rather than the time it settled. In our view, it was a fundamental and serious error to confuse the time that a commission was paid with the time that the obligation to pay it arose.

Administrative Appeals Tribunal

Our above argument with the Commonwealth’s Department of Employment and Workplace Relations (Department), fell on deaf ears, leading to our client appealing to the Administrative Appeal Tribunal (AAT). The AAT ultimately affirmed our client’s position, stating that our client was entitled to an advance under the scheme in respect of any commissions outstanding for properties sold within the wages entitlement period.

Federal Court of Australia 

Not willing to accept what was an unfavourable precedent for the Department, it appealed the AAT’S decision to the Federal Court of Australia, throwing everything but the kitchen sink at the AAT’s decision.

It was a fruitless and expensive exercise by the Department, with the result a resounding win for our client and our firm. The Court’s decision confirmed that the date of sale of the relevant properties was the critical date, and indeed that our client was entitled to the commission payments that he sought, pursuant to the FEG scheme. The battle for our client’s long-awaited commission payments under the FEG scheme finally came to an end.

Whilst it was a lengthy process to get to this point, these are defining decisions that will no doubt assist and empower other commission-based employees in years to come. We have included links to the decision below.

If you, or someone you know, have any queries about the operation of the FEG scheme, or if you have a question about being owed wages as a result of an employer being subject to liquidation or bankruptcy, please reach out to Tisher Liner FC Law’s litigation and employment team, as we would be very happy to assist.


AAT Decision;query=bhagwandas;mask_path=

Federal Court Decision;query=bhagwandas;mask_path=

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