The Case

Marson v Coral Princess Cruises (N.Q.) Pty Ltd T/A Coral Expeditions (2020)

Mr Marson was a Marine Superintendent with Coral Princess Cruises (N.Q.) Pty Ltd T/A Coral Expeditions (Coral Princess Cruises). Coral Princess Cruises was required to suspend its operations to comply with the Federal Government’s COVID-19 requirements. This resulted in Coral Princess Cruises completely ceasing to trade. Coral Princess Cruises stood down half of its workforce (107 employees), with the remainder working reduced hours and wages in caretaker roles.

Mr Marson was stood down. As a result of Coral Princess Cruises ceasing to trade, Mr Marson’s duties were severely reduced and his few remaining duties were given to the small group performing caretaker roles.

Mr Marson lodged a dispute in the Fair Work Commission (FWC) alleging Coral Princess Cruises’ decision to stand him down was unlawful. Mr Marson alleged there was work for him to do that had been given to other employees.

The Verdict

The FWC held the stand down was lawful and dismissed Mr Marson’s application.

The FWC found Coral Princess Cruises had complied with the Fair Work Act 2009 (Cth) (FW Act) in that:

• Mr Marson had been stood down during a time when he could not be usefully employed;
• the stoppage of work was not something for which Coral Princess Cruises could reasonably be held responsible, as it resulted from a direction issued by the Government due to the COVID-19 pandemic;
• the reason Mr Marson could not be usefully employed was because of the stoppage of work, a decision made in difficult financial circumstances;
• Coral Princess Cruises had acted in good faith and not every employee could be used to perform caretaker roles; and
• Coral Princess Cruises had ceased trading and completely stopped its normal operations of conveying passengers on its cruise ships. The fact there was a small caretaker group did not mean it was trading. The existence of this group did not constitute a downturn in work rather than a stoppage of work.

The Lessons

To use the stand down provisions in the FW Act, there must be a complete stoppage of work for which you cannot be reasonably held responsible. Furthermore, it is this stoppage of work that causes the stand down. A downturn in trade is not sufficient. If the business ceases to trade, resulting in some employees not being able to perform all their duties, you can temporarily reassign those duties to other employees and stand some employees down. This does not mean all employees can be usefully employed.

Please note: Case law is reported as correct and current at time of publishing. Be aware that cases in lower courts may be appealed and decisions subsequently overturned.