Albino Miotto and Danilo Benvenuto quit their administration jobs at the diplomatic outpost during the furore over the Italian Government’s threat to shut it down at the beginning of 2014.
South Australian Premier Jay Weatherill was eventually able to lobby the Italian Government to reverse its decision to close the diplomatic outpost, but the reversal came after Miotto and Benvenuto had found new jobs elsewhere.
The former employees, both dual Australian and Italian citizens, took the Republic of Italy to the South Australian Industrial Relations Court, arguing that they were entitled to Australian-standard long service leave payments and superannuation.
The pair were not paid any long service leave and received no superannuation contributions after 15 years of employment.
The Italian Government argued it was “immune” to the legal proceedings, because, its lawyers said, the workers’ contracts implied they were not employed under the provisions of Australian laws.
The Italian Government argued part of the (Australian) Immunities Act exempted it from the legal action.
However, Industrial Magistrate Stephen Lieschke ruled that while the contracts contained no terms that referred to any Australian employment entitlements, and contained several references to Italian laws, no part of the contract asserted “exclusivity of Italian law as to legal proceedings”.
“Reference to Italian laws as sources of entitlement could not have been intended to mean the same as claiming immunity from Australian proceedings,” Lieschke’s judgement says.
He writes that “the circumstances are consistent with the respondent [the Italian Government] simply assuming Italian source entitlements would not be challenged in Australian courts as they were incorrectly thought to necessarily be superior to Australian entitlements,” but there had been “no specific attention given to the issue of immunity from Australian legal proceedings”.
“Furthermore, the circumstances are consistent with the respondent simply assuming it would be immune from proceedings about the employment rights of locally engaged Australian citizens if they were also Italian citizens, as the applicants were.”
According to the judgement, the Italian Acting Consul in Adelaide Orietta Borgia explained that she had also deducted 68 days’ worth of salary from the pair, because they gave 22 days’ notice of their resignation.
The Italian Government argued it was able to withhold the money from the pair because, under Italian law, they were required to give 90 days’ notice of termination.
But Miotto and Benvenuto’s representatives argued they were only required to give four weeks’ notice, based on provisions of the Clerks Award (an Australian employment award) and Fair Work Act (an Australian law).
The Italian Government countered that the Clerks Award covers private sector employees in Australia, and would not apply because the pair was employed in the Italian public sector.
However, Lieschke ruled that employment in the Italian public sector “falls outside of the concept of public sector employment in the current context, and falls within the concept of private sector employment for the purposes of the Act and Award”.
“In my opinion, the appropriate conclusion is that the Clerks Award applied to both applicants [the former employees] due to the operation of Australian law.
“This means the maximum period of notice both applicants were required to give was four weeks.
“The required 90 day notice period was an unlawful detriment imposed on the applicants.
“As only 22 days’ notice was given the respondent is only permitted to deduct an amount equal to the wages the applicants would have earned over the remaining six calendar days.”
Lieschke also ruled that the pair were also entitled to payment in lieu of long service leave owed to them under South Australian law.
He said their employment contracts did not contain any term that denies the long service leave entitlement, and “even if there was, it would be inconsistent with the Long Service Leave Act”.
The Italian Government further argued that performance bonuses that were paid to the former employees since 2002 “should now be a set-off against their respective long service leave entitlements”.
However, ruled Lieschke, “the only basis for this contention, unsupported by any evidence,” was that the pair earned more in performance bonuses under the contract they switched onto in 2002 than they would have been paid in long service leave under a “local law” contract with the Italian Government under which they were previously employed.
“I reject this contention,” Lieschke’s judgement says.
The Industrial Magistrate did, however, rule that the employer contributions to the Italian pensions of each former employee could, in principle, “properly be considered as contributions to the employees’ superannuation entitlements”.
Lieschke said that “provided there is reliable evidence” of these employer contributions, they could offset the former employees’ Australian superannuation entitlements.
According to the judgement, delivered on November 9, the Italian Government was given 14 days to address what it contributed to the former employees’ the Italian pension.
Both parties were invited to make submissions regarding the total payments due, following the judgement, to the employees.
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