Can a worker file a claim even after a settlement agreement?

A recent case from the Western Australian Industrial Relations Commission (WAIRC) has clarified an issue that has probably boggled the minds of some employers and HR personnel – can employees still file claims even after reaching a settlement agreement?

Find out how the WAIRC responded to an employee’s application for denial of contractual benefits even after a mutual settlement agreement has been made with the employer to resolve it.

According to records, the employee worked as an administrative assistant and provisional psychologist over the course of two years at the employer’s workplace. She worked both as an employee and independent contractor.

After termination of her employment, she then brought an unfair dismissal claim which was resolved by agreement following a conciliation conference.

The settlement agreement provided that the employer would pay her $7,500 gross, in addition to superannuation. The parties also agreed to “transitional arrangements” to allow the employee to access her emails and inform her clients of her separation from the employer. They also agreed to a “mutual release and a bar to further proceedings arising out of the employment and contracting relationship.”

The employee’s claim

Following the settlement, the employee filed a separate claim for denial of contractual benefits claim, seeking to recover “backpay still owing,” additional superannuation, and wages for work completed during the transitional period following settlement.

The Commission’s decision

In its decision, the WAIRC considered that while the worker “may not have intended to release the employer from payment for her services in the transitional period,” the wording of the settlement agreement “expressly barred all further claims in relation to the employment, which included the transitional period.” This case is a reminder for HR to carefully craft the provisions of any settlement agreement to express the parties’ intentions fully. It’s also helpful to note that stating the terms in a clear and unambiguous manner would prevent any misapplication or miscommunication between parties.

The WAIRC further reminded both employers and employees that “it is not in the public interest” for the matter to proceed if the issues had previously been settled by agreement, especially if the case was resolved under its dispute resolution processes.

The WAIRC also noted that the employer had paid her additional sums that exceeded the applicant’s claim for wages after the settlement. “Even if the settlement agreement did not bar further claims since she had been paid in relation to the performance of services during the transitional period,” the claim was deemed “trivial” by the WAIRC. Thus, the employee’s application was dismissed.