1 Fair Work Act 2009 s.120 - Application to vary redundancy pay for other employment or incapacity to pay Islington One Hotel Pty Ltd t/a Islington Hotel v Sam Ling (C2026/2028) COMMISSIONER SLOAN SYDNEY, 20 MARCH 2026 Variation of redundancy pay [1] Until recently, Islington One Hotel Pty Ltd operated the Islington Hotel in Hobart. It employed Sam Ling in the position of “Maintenance and Gardener” at the Hotel. His employment commenced on 22 August 2022. [2] Islington One negotiated a sale of the Hotel. As a consequence, in a letter to Mr Ling dated 16 January 2026 the company stated: “As previously advised, Islington One Hotel Pty Ltd is currently in the process of being sold. We can now confirm the anticipated completion date is 6 February 2026, subject to the sale proceeding as planned. Following the completion of the sale, Islington One Hotel Pty Ltd will cease operating the business under the current ownership, and as a result we will no longer be able to offer ongoing employment beyond this date. Due to the operational changes arising from the sale, your position is no longer required. Accordingly, this letter serves as formal notice that your employment will end on 6 February 2026. This termination is on the grounds of genuine redundancy. Final Pay & Entitlements You will be paid all outstanding wages and entitlements owing up to your final day of employment, including: • Wages up to and including 6 February 2026; • Redundancy pay (where applicable, and to be confirmed); • Any accrued but unused annual leave and other leave entitlements (if applicable); and [2026] FWC 919 DECISION [2026] FWC 919 2 • Any other outstanding allowances and entitlements payable to you. … We have been working with the incoming owner to make this transition as smooth as possible. The incoming owner has indicated they may wish to retain members of the existing team and will meet with you to discuss any potential employment opportunities. Any offer of employment (including terms and conditions) will be made directly by the incoming owner.” [3] As it transpired, the sale of the Hotel was delayed until 15 March 2026. Mr Ling remained employed by Islington One until that date. [4] Mr Ling secured employment with the new operator of the Hotel, Boxwood Spa Pty Ltd, to take effect immediately on that company taking over the management of the Hotel. He will remain employed at the Hotel as “Maintenance and Gardener” on largely similar terms to those he had enjoyed with Islington One. [5] Islington One has applied to the Commission under section 120 of the Fair Work Act 20091 for an order to reduce Mr Ling’s redundancy pay to two weeks’ pay. The premise of the application is that the offer of employment from Boxwood Spa was “other acceptable employment”. [6] Mr Ling opposes the application. [7] For the following reasons I have determined to dismiss Islington One’s application. Relevant law and principles [8] Section 120 relevantly provides: Variation of redundancy pay for other employment or incapacity to pay (1) This section applies if: (a) an employee is entitled to be paid an amount of redundancy pay by the employer because of section 119; and (b) the employer: (i) obtains other acceptable employment for the employee; or (ii) cannot pay the amount. (2) On application by the employer, the FWC may determine that the amount of redundancy pay is reduced to a specified amount (which may be nil) that the FWC considers appropriate. [9] The approach that I should take to Islington One’s application is well established.2 The first step is to determine whether section 120 applies, which requires the conditions in [2026] FWC 919 3 section 120(1) to be met: that Mr Ling has an entitlement under section 119 to redundancy pay, and that Islington One has obtained other acceptable employment for him. An employer “obtains” other acceptable employment when it acquires or gets the employment by its conscious, intended acts. [10] If section 120 applies, the next step is to decide whether Mr Ling’s entitlement to redundancy pay should be reduced and, if so, by how much. This requires the exercise of a broad discretionary power. Consideration [11] The first condition in section 120 is met: under section 119, Mr Ling was entitled to 7 weeks redundancy pay.3 However, I am not satisfied that his employment with Boxwood Spa was obtained by Islington One. [12] Islington One submitted: “Islington Hotel submits that the Commission should reduce the redundancy entitlement to two weeks’ pay, on the basis that Mr Ling has obtained acceptable alternative employment.” (My emphasis) [13] But the question is not simply whether Mr Ling has secured ongoing and comparable employment with Boxwood Spa. Islington One is required to demonstrate that he did so as a result of its conscious, intended acts. [14] In its application, Islington One stated: “We have negotiated offers of employment with the new business owner on a like-for- like role, Maintenance and Gardener, Part-time 20-25 hours per week. Plus weekly call allowance of $50.00.” [15] But there was little evidence of such negotiations. Islington One’s material in chief was in large part confined to a comparison of Mr Ling’s existing terms of employment with those that Boxwood Spa had offered him. It led no evidence in chief to demonstrate that it had obtained that employment for Mr Ling. [16] It is significant that Islington One’s letter to Mr Ling of 16 January 2026 did not suggest that it had secured him an offer of employment with Boxwood Spa. The potential for such employment was couched in terms that made it clear that this was a matter entirely within Boxwood Spa’s discretion, that is: “The incoming owner has indicated they may wish to retain members of the existing team and will meet with you to discuss any potential employment opportunities.” (My emphasis) [17] Mr Ling relied on a letter from Katrina Green, the Manager of Operations at Boxwood Spa, dated 3 March 2026, in which she stated: [2026] FWC 919 4 “Boxwood Hospitality confirms that Sam has been offered employment with our organisation following settlement of the purchase of Islington Hotel. Sam was interviewed as part of our transitioning process during the purchase of the hotel. His employment offer was made based on our independent assessment of his skills, experience, and suitability for the role. Boxwood Hospitality was under no obligation to employ any existing staff of Islington Hotel. Sam’s employment with Boxwood Hospitality will be under a new contract of employment and as a new employee of our organisation. It is our understanding that, prior to settlement, Islington Hotel was to finalise the employment of its existing staff and address any outstanding entitlements in accordance with their obligations. Boxwood Hospitality will not be carrying over prior leave entitlements from Islington Hotel.” [18] In its evidence in reply, Islington One filed a series of emails which I understand to be between representatives of Islington One (through an entity described as “La Vie Hotels & Resorts”) and Boxwood Spa. The high point of the evidence was as follows: (1) On 7 January 2026, Ryan Isemonger, the Group Director of People and Culture at La Vie Hotels & Resorts, sent an email to Paul Lanzone at a Boxwood email address stating: “As we move into a tighter timeframe, we’re keen to work closely together to ensure the communication to team members around the sale and their potential employment options is handled as smoothly and thoughtfully as possible. From our perspective, aligning the timing of the sale notification, termination notice, and any offers of ongoing employment will be important in helping reduce uncertainty and providing the team with confidence around continuity. We’re planning to issue the notices by this Friday at the latest, and it would be ideal if your team were also in a position to issue offers of employment on the same day, to provide reassurance to those who may be concerned. Please confirm that this is achievable for your team. I understand you are speaking with most of the team on Thursday to get a feel for their suitability, would it be possible to receive the target list by Friday morning? This will allow us to ensure we provide the appropriate notice periods in line with the NES and manage the process consistently for the Team.” (My emphasis) (2) On the same day, Ms Green sent an email to Mr Isemonger stating: “We can meet the proposed timeframe and are comfortable issuing offers on Friday to align with the sale notification and termination notices. We’re also looking forward to meeting with the core Islington team tomorrow to further understand suitability and roles. [2026] FWC 919 5 To help ensure we can provide offers that are as close to like-for-like as possible, it would be greatly appreciated if you could please share the existing staff contracts with us. This will allow us to align terms appropriately and support a smooth and consistent process for the team.” (3) Also on 7 January 2026, Mr Isemonger sent an email to Ms Green stating: “I have attached a zip file of the contracts for the Team at Islington.” (4) On 15 January 2026, Nelsy Zreik, the Group Director of Finance – Australia for La Vie Hotels and Resorts, sent an email to Mr Lanzone stating: “In addition, if you are proceeding with employing the employees, would you be able to share the offers of employment with us? As you are aware, we are working to a tight turnaround with notices, and having this information will help us mitigate any potential issues.” (My emphasis) [19] These emails reveal that Islington One provided information regarding its employees to Boxwood Spa to facilitate Boxwood deciding whether to make offers of employment to them, and if so on what terms. The emails fall short of demonstrating that such offers were the subject of negotiation, much less that Boxwood Spa was under any obligation to offer employment to Islington One employees. The emails make no reference to Mr Ling. [20] Having regard to the available evidence, I am not satisfied that Islington One acquired or got Mr Ling’s employment with Boxwood Spa by its conscious, intended acts. [21] It follows that the pre-condition in section 120(1)(b)(i) is not met. Consequently, section 120 does not apply. Determination [22] The application is dismissed. COMMISSIONER Printed by authority of the Commonwealth Government Printer <PR797823> [2026] FWC 919 6 1 In this decision, references to legislative provisions are to provision of the Fair Work Act 2 See Australian Commercial Catering Pty Ltd v Marcelia Powell and Maria Togia; Marcelia Powell v Australian Commercial Catering Pty Ltd [2016] FWCFB 5467 at [35]-[38] 3 This was not a matter of controversy. I note for completeness that the exclusions in s 121(1) of the Act do not apply in Mr Ling’s circumstances.