Fortnightly Newsletter
Fortnightly newsletter
Workplace Law is ever-changing, whether through decisions of the courts and commissions or changes to the many pieces of State and Federal legislation that regulates the relationship between Employee and Employer. We’ve put together this fortnightly update to assist by giving you easy to understand snapshots of some of the recent changes that affect Employers.
Unfair contract term struck out by FWC
A contract term was struck out by the Fair Work Commission (FWC) in the first successful unfair contract case. The contractor worked as an adult entertainer and was contracted by Diva Girl Pty Ltd (Diva Girl) to complete a two-week circuit that involved significant travel and set shifts across multiple venues. However, the contractor left the circuit early due to safety concerns, after a man came knocking on her motel door at night.
As set out in the contract, Diva Girl required the contractor to forfeit all wages, deposits and commissions due to her failure to complete the circuit. While the forfeited amount and additional travel assistance was later paid back to the contractor, the FWC maintained its decision to strike out the contract term such that that the contractor was in fact entitled to receive the payment/s, rather than payment being at the discretion of Diva Girl.
The FWC also held the contract term was unfair as it imposed more obligations and risks on the contractor. Particularly Diva Girl, as the principal, should have understood the costs and risks associated with the adult entertainment industry and the nature of the work contracted, and thus bear greater responsibility ‘as the principal who has set up their operation on that basis’.
Source: Tessa Bell v Diva Girl Pty Ltd trading as Delicious Entertainment [2026] FWC 3283 (7 September 2026) and the FWC’s order
$177k fine for company caught exploiting worker
A $177,000 fine was imposed on an accounting firm and its director after they exploited a worker and knowingly misled a Fair Work Inspector. The worker, who was on a temporary graduate visa, paid the company and its director in, what the Federal Circuit and Family Court of Australia (FCFCOA) called, a ‘cashback’ scheme. The amounts paid by the worker were then transferred to a company bank account, which were used to falsely ‘pay’ the worker her entitlements using her own money.
In addition to the deliberate and unlawful cashback scheme, the company knowingly provided false and misleading information to a Fair Work Inspector investigating the exploitation. Further, the company did not start repaying the worker until two years after the Fair Work Investigation began.
The FCFCOA held that despite the company having corrected their contraventions by the time of the decision, the $177,000 fine was appropriate and balanced between the severity of the conduct, and deterrence against such exploitation happening again. After this decision, the Fair Work Ombudsman (FWO) issued a statement that ‘Unlawful cashback schemes are one of the most blatant and appalling forms of exploitation’ and will not be tolerated by the FWO.
Source: Fair Work Ombudsman v Innovative Associates Pty Ltd [2026] FedCFamC2G 1645 (27 August 2026) and Accounting and financial services company penalised for unlawful cashback scheme – Fair Work Ombudsman (1 September 2026)
Severe sexual assault leads to record general damages
A $255,000 compensation, including a record $220,000 in general damages, was awarded to a victim who was raped and sexually assaulted by her former employer.
After starting work to help pay off her mortgage, the victim experienced escalating assault, sexual harassment and verbal threats from her ex-employer. Including after she stopped working for him, the ex-employer contacted the victim, lying that he would apologise and pay her for any outstanding wages. However, after luring the victim, the ex-employer subsequently raped and left the victim pregnant.
While the victim sought higher general damages awards than what was awarded by the FWC, the FWC acknowledged the need for general damage awards to compensate the harm caused by the sexual harassment than to be punitive. However, the case also appears to favour towards increasing general damages awards for sexual harassment and victimisation.
Fuel prices on the rise, and so are fuel allowances
With fuel prices on the rise, the FWC has increased fuel allowances by 4c per kilometre for workers under the Social, Community, Home Care and Disability Services Award 2010 (SCHADS) and Aged Care Award 2010 (Aged Care).
The Australian Council of Trade Unions initially sought an urgent increase to fuel allowances for workers across 41 different awards, to which many employer associations opposed. However, the FWC declined to increase fuel allowances for the 39 other awards. It stating that the evidence put forward was generalised, vague and focused on the effect of increased fuel prices than the nature of private vehicle use under those awards.
For SCHADS and Aged Care workers, the FWC accepted the (often) frequent travel required to be undertaken by workers to provide services to its clients. Thus, the FWC was satisfied that a fuel allowance increase would have a material impact and assist in absorbing the rising fuel expenses incurred from work. These changes are expected to apply from the first full pay period on or after 1 September 2026.
Perception of employees not grounds for dismissal
A sacked general manager (GM) was awarded $14,000 after the FWC decided he was unfairly dismissed. The employer dismissed the former GM after alleging he had fraudulently misclassified his partner, who was also an employee, so that she received higher award payments, and allowed employees to drive company vehicles while intoxicated or on drugs.
In a meeting before his dismissal, the GM accepted he had misclassified his partner but did not notify the error as his partner was finalising her employment with the company. The GM also claimed he had ‘no knowledge’ of employees operating vehicles while under the influence of alcohol or drugs, but ‘took action’ where he was made aware of those allegations. The employer did not offer the GM to take part in a performance improvement plan before his dismissal.
Although the GM had misclassified his partner, the FWC found no fraudulent intent behind the misclassification. Further, the employer’s director and operations manager admitted to colluding in preparing their statements which, though not done dishonestly, held some weight on the FWC’s decision. Ultimately, the FWC held that the employer’s perception that the GM fraudulently misclassified his partner, prematurely convinced them the GM was not worth working with and was unfairly dismissed.
Source: Mr Aaron Laws v Hotham Operations Pty Ltd [2026] FWC 1981 (11 August 2026)
We hope you have enjoyed this fortnight’s employment law news. See you next fortnight!
