Bank advisers' exit deeds did not sign away their award rights

Macquarie Bank paid its advisers through commission plus a package it called 'Basic Cost Responsibility', part of which was paid as fixed monthly amounts. After leaving, many sued, arguing they had in effect been paid commission only and were owed award wages and leave entitlements. Forty-eight took the case to the Full Federal Court.

Fifteen of the former advisers in the appeals had signed deeds of release on the way out. Nicholas Sandford signed his in May 2015, when he resigned and retired from the industry; it gave him two years of revenue from his former clients and released all present and future claims, including those 'arising under any award'. Many others were signed on redundancy in 2018. The trial judge held that Mr Sandford's and Mr Edwards's deeds barred their claims and ordered them to pay the bank's costs, but that 13 others did not.

The Full Court held that none of the deeds barred the claims. Rights under awards and the Fair Work Act generally cannot be contracted out of. A genuine compromise of an existing dispute about them can bind, but there has to be a dispute to compromise. Nothing in any of the deeds, or their circumstances, pointed to such a dispute; Mr Sandford said he did not then know he had an underpayment claim. None of the money paid under the deeds was said to be for those entitlements. The costs orders against Mr Sandford and Mr Edwards were overturned.

Winning the deeds point did not mean winning the money. Most of the advisers' pay claims failed, including those for wages and for leave and public holiday pay. Only a claim for annual leave loading survived. After the judgment, the bank and the advisers settled, and in August 2023 the Court made consent orders dismissing the proceedings with no order as to costs.