If an employee previously worked for an associated entity of your company, does that period of employment count as service for the purposes of unfair dismissal?

s22 of the Fair Work Act 2009 defines the meaning of ‘transfer of employment’.

Section 22(7) states there is a transfer of employment if the following conditions are satisfied:

• The employee becomes employed by the second employer not more than three months after the termination of the employee’s employment with the first employer, and
• The first employer and the second employer are associated entities when the employee becomes employed by the second employer.

If both of these conditions apply, service with both associated entities would count as total service.

This has been further supported in the Explanatory Memorandum to the Fair Work Bill 2009 which states that “where there is a transfer of employment between entities, service with the first employer will always count towards service with the second employer”.

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