[2026] FWC 54
Citation: [2026] FWC 54
What happened
Loan Base Pty Ltd sought costs against the Applicant, who had previously filed and then discontinued an unfair dismissal application against the company. The Applicant was dismissed as CEO and director of Loan Base in April 2025, due to performance issues and allegations of serious misconduct, including diverting clients to his own company, Secure Finance Pty Ltd. He claimed procedural deficiencies in his dismissal and lack of payment of entitlements. Loan Base argued it complied with the Small Business Fair Dismissal Code and offered to settle the costs application for $50,000, which was rejected.
What was decided
The Fair Work Commission Deputy President Slevin dismissed Loan Base’s application for costs against the Applicant. The Commission found that the preconditions under sections 611(2) and 400A of the Fair Work Act 2009 were not met. This means Loan Base will bear its own costs. The Deputy President noted that the power to award costs should be exercised with caution and that the Applicant’s case, while ultimately unsuccessful, was not manifestly groundless.
What it means for employers
Employers should be aware that seeking costs against former employees is difficult and requires a clear demonstration of unreasonable conduct or a case with no reasonable prospect of success. Simply losing a case is not enough to justify a costs order. Following the Small Business Fair Dismissal Code does not automatically guarantee the right to recover costs.
What it means for employees
Employees who discontinue unfair dismissal claims should be aware that their employer may seek costs. However, the Commission will carefully consider the circumstances before ordering an employee to pay those costs. Having a reasonable basis for the claim, even if ultimately unsuccessful, can help avoid a costs order.
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This summary was drafted from the published decision and reviewed before publishing. It is general information, not legal advice. For your specific situation, speak to the Fair Work Ombudsman (13 13 94) or a qualified lawyer. About these summaries & corrections