ARTICLE · 03 MARCH 2012

One ex-officeholder, multiple contracts: refreshing the statutory exemption for termination payments to executives

Clayton Utz

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The statutory exemption can be refreshed each time a person signs a new contract, even if he/she continues to hold the same position.

AustraliaEmployment and HR

Joe Catanzariti

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Key Points:

The statutory exemption can be refreshed each time a person signs a new contract, even if he/she continues to hold the same position.

Receivers of a failed company have been unable to convince the Federal Court that statutory restrictions on termination payments reduced the payout entitlement of a senior executive (White v Norman; In the Matter of Forest Enterprises Australia Limited (Receivers and Managers Appointed) (in Administration) [2012] FCA 33).

Background

Mr White was employed as CEO by FEA in 2003. He continued in that role under a series of contracts. In mid-2009, he signed a new contract which included a provision for payment of a sum in lieu of notice of termination.

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