1 Fair Work Act 2009 s.400A - Application for a costs order against a party Maker Store Pty Ltd v Zane Petty (C2026/5873) COMMISSIONER YILMAZ MELBOURNE, 9 JULY 2026 Application for costs – costs incurred because of unreasonable acts and omissions – costs not awarded. [1] On 13 April 2026, I issued a decision on transcript and an order1 with respect to an application made by Mr Zane Petty (Mr Petty or the Costs Respondent) for an unfair dismissal remedy (the s.394 application). [2] On 20 April 2026, Maker Store Pty Ltd (the Costs Applicant) applied for costs against Mr Zane Petty and relies on s400A of the Fair Work Act 2009 (Cth) (the Act) [3] In the s.394 application I found that the application should be dismissed as Mr Petty failed to comply with Directions from my Chambers and his failure to attend a conference or hearing held by the Fair Work Commission (the Commission). [4] In the s.394 application a Mention (Case Management Conference) was scheduled for 17 March 2026 at 2:00pm the applicant did not attend, and the Mention lasted roughly 5 minutes. [5] Directions were issued and are as follows, Mr Petty was to file and serve by no later than 4:00pm Wednesday, 25 March 2026, their outline of argument, a statement of evidence and any other documents they intend to rely on. The Costs Applicant was to file and serve by no later than 4:00pm Wednesday, 1 April 2026, their outline of argument, a statement of evidence and any other documents they intend to rely on. [6] The s.394 application was listed for Jurisdictional Hearing (Minimal Employment Period), by video on Microsoft Teams at 2:00pm on Monday, 13 April 2026, the hearing lasted roughly 12 minutes. [7] The Costs Applicant has now made an application pursuant to s.400A of the Act for costs against the Costs Respondent. 1 PR798571 [2026] FWC 2610 DECISION [2026] FWC 2610 2 [8] In summary supporting their application, the Costs Applicant’s submissions include: • The Costs Applicant claims that the Costs Respondent acted unreasonably in connection with the conduct and continuation of the proceedings. The Costs Respondent commenced an unfair dismissal application under s.394 of the Act despite lacking the requisite minimum employment period. The Costs Respondent’s employment was approximately 11 months falling short of the minimum employment period of 12 months as the Cost Applicant is a small business. • The Costs Respondent failed to attend the listed proceedings before the Commission being: o Conciliation Conference on 13 March 2026; o Mention (Case Management Conference) on 17 March 2026; o Determinative Conference/Hearing (Jurisdiction) on 13 April 2026. • The Costs Respondent failed to file or serve any evidence or submissions in support of the application. • The Costs Respondent failed to engage with the Commission including emails and phone calls. • As a direct result of the Costs Respondent’s conduct, the Costs Applicant has incurred costs such as legal fees and internal management time, which would not have been incurred had the Costs Respondent acted reasonably. • The Costs Applicant claims that it is appropriate in all circumstances for the Commission to exercise its discretion to award costs. [9] The Costs Applicant has provided an itemised schedule of costs in their Form F6 totalling $3,675. This is made up by $2,550 of legal costs and $1,125 of internal costs. [10] Legal costs incurred by the Costs Applicant are made up of two invoices, the first invoice between 19 and 28 February totals $550 and includes; • Review of Mr Petty’s unfair dismissal application and related correspondence • Drafting and amendment of Form F3 Employer Response • Review of correspondence from the Commission • Telephone conference with the Costs Applicant [11] The second invoice between March and April 2026 totals $2,000 and includes; • Review of Commission directions and procedural requirements • Review and consideration of evidence provided by the Costs Applicant • ASIC searches relevant to jurisdictional issues • Drafting and settling witness statement • Drafting the Costs Applicant’s submissions (including jurisdictional submissions) • Correspondence with Commission and client (incidental) [12] Internal costs incurred by the Costs Applicant between February and April 2026 totals $1,125 and includes; • Review of application and Commission correspondence • Preparation of documents and provision of instructions to legal representatives • Preparation for and attendance at proceedings (13 March, 17 March, 13 April 2026) [2026] FWC 2610 3 [13] The costs Respondent has not engaged with any correspondence from my Chambers regarding this application for costs. Consideration [14] The sections of the Act that deal with costs in this circumstance is s400A and 611. [15] The Commission may make a costs order in respect to an unfair dismissal claim if any of the terms of either s400A or 611 have been satisfied. [16] Section 400A of the Act provides as follows: 400A Costs orders against parties (1) The FWC may make an order for costs against a party to a matter arising under this Part (the first party) for costs incurred by the other party to the matter if the FWC is satisfied that the first party caused those costs to be incurred because of an unreasonable act or omission of the first party in connection with the conduct or continuation of the matter. (2) The FWC may make an order under subsection (1) only if the other party to the matter has applied for it in accordance with section 402. (3) This section does not limit the FWC’s power to order costs under section 611. [17] Section 611 of the Act provides as follows: 611 Costs (1) A person must bear the person’s own costs in relation to a matter before the FWC. (2) However, the FWC may order a person (the first person) to bear some or all of the costs of another person in relation to an application to the FWC if: (a) the FWC is satisfied that the first person made the application, or the first person responded to the application, vexatiously or without reasonable cause; or (b) the FWC is satisfied that it should have been reasonably apparent to the first person that the first person’s application, or the first person’s response to the application, had no reasonable prospect of success. Note: The FWC can also order costs under sections 376, 400A, 401 and 780. (3) A person to whom an order for costs applies must not contravene a term of the order. Note: This subsection is a civil remedy provision (see Part 4-1). [2026] FWC 2610 4 [18] The Costs Applicant relies on s.400A of the Act to obtain costs against the Costs Respondent because it incurred costs with defending an unfair dismissal application. However, the Commission must be satisfied that the Costs Respondent caused those costs to be incurred. [19] Section 400A was inserted into the Act by the Fair Work Amendment Act 2012. The Explanatory Memorandum to the Fair Work Amendment Bill 2012 states: ‘168. Item 4 inserts a new section 400A to enable the FWC to order costs against a party to an unfair dismissal matter (the first party) if it is satisfied that the first party caused the other party to the matter to incur costs by an unreasonable act or omission in connection with the conduct or continuation of the matter. 169. As with the new power to dismiss applications under section 399A, the power to award costs under section 400A is not intended to prevent a party from robustly pursuing or defending an unfair dismissal claim. Rather, the power is intended to address the small proportion of litigants who pursue or defend unfair dismissal claims in an unreasonable manner. The power is only intended to apply where there is clear evidence of unreasonable conduct by the first party. 170. The FWC’s power to award costs under this provision is discretionary and is only exercisable where the first party (whether the applicant or respondent) causes the other party to incur costs because of an unreasonable act or omission. This is intended to capture a broad range of conduct, including a failure to discontinue an unfair dismissal application made under section 394 and a failure to agree to terms of settlement that could have led to the application being discontinued. 171. However, the power to award costs is only available if the FWC is satisfied that the act or omission by the first party was unreasonable. What is an unreasonable act or omission will depend on the particular circumstances, but it is intended that the power only be exercised where there is clear evidence of unreasonable conduct by the first party.’2 [20] Where a party chooses to incur legal expenses, they bear their own costs in a matter before the Commission.3 Section 400A sets out additional circumstances where a party may make an application for costs orders where the other party caused the party to incur costs because of unreasonable conduct or an unreasonable manner that the party defends or pursues an unfair dismissal claim. [21] Section 400A requires the Commission to firstly be satisfied that costs have been incurred because of an unreasonable act or omission in relation to the conduct or the matter or its continuation. In this matter, the Costs Respondent filed the Application but thereafter failed to engage with the Commission in relation to his application. The costs claimed for by the Costs Applicant were not directly caused by the Costs Respondent. The Costs Applicant elected to obtain legal advice; leave to be legally represented was not granted by the Commission. At the Directions hearing the Costs Applicant was in attendance and an explanation was given in 2 Explanatory Memorandum, Fair Work Amendment Bill 2012. 3Fair Work Act 2009 (Cth) s 611(1). [2026] FWC 2610 5 relation to how the matter may be dealt with if the Costs Respondent again failed to engage with the Commission. The additional costs incurred were self-inflicted. [22] Section 400A does not limit the Commission’s power to award costs in relation to s.611 of the Act. While the Costs Applicant has not applied for costs under s.611, it is helpful to consider the general provision under s.611. Firstly s.611(1) sets out the general rule that all parties must bear their own costs in relation to a matter before the Commission. [23] Section 611(2)(a) allows that the Commission to order a person to bear some or all of the costs if the Commission is satisfied that the Application was made vexatiously or without reasonable cause. The Commission must first be satisfied that the Costs Respondent made the application or responded to the application vexatiously or without reasonable cause. This requires the Commission to be satisfied that it should have been reasonably apparent to the Costs Respondent that the application had no reasonable prospects of success. There is no evidence before the Commission to satisfy it. It is observed that the Costs Applicant has not directly addressed s.611(2)(a) of the Act in their application and do not to rely on it. [24] Section 611(2)(b) allows that the Commission may order a person to bear some or all of the costs if the Commission is satisfied that it should have been reasonably apparent that the application had no reasonable prospect of success. The Costs Applicant states that the s394 application was jurisdictionally deficient and had no reasonable prospect of success from the time it was made as: 1. The employer is a small business within the meaning of the Act, and 2. Mr Petty’s employment was approximately 11 months which is less than the 12-month minimum employment period required to bring an unfair dismissal application. [25] There is no evidence before the Commission that the Costs Respondent ought to have been aware of the jurisdictional objection and its likely success. Therefore, I do not find that this ground is satisfied to award costs. [26] Applications before the Commission under the Fair Work Act 2009 are not a costs jurisdiction, therefore the Commission should cautiously consider awarding costs. The authority on the approach to s.611 of the Act is Keep v Performance Automobiles Pty Ltd. 4 The Commission’s power to award costs only arises where the Commission is satisfied as to the matters in s.611(2)(a) or s.611(2)(b). This means caution and a clear case is required.5 [27] Legal representation is not automatic in the Commission and leave to appear must be sought. It is the discretion of the Commission Member as to whether leave is granted. If a party wishes to have legal representation, they should file a Form F53 and brief submissions under s.596 of the Act as to why leave should be granted. In this matter the Costs Applicant did not file a Form F53 and did not have any legal representation in proceedings in the Commission nor was permission granted. Consistent with my finding in relation to the s.400A application legal costs incurred were self-inflicted and not caused by the Costs Respondent. 4 Keep v Performance Automobiles Pty Ltd [2015] FWCFB 1956 5 Church v Eastern Health t/as Eastern Health Great Health and Wellbeing [2014] FWCFB 810. [2026] FWC 2610 6 Conclusion [28] I am not satisfied that the Costs Applicant has substantiated the costs application under s.400A or s.611 of the Act for the Commission to use its discretionary power to award either legal or internal costs. [29] It is unfortunate for the Costs Applicant to have incurred internal costs having devoted time to defending an unfair dismissal application where justifiably it raised a jurisdictional objection. The Costs Applicant was thorough and individually engaged legal advice, which was unnecessary but nevertheless costly. For Mr Petty to simply disengage after filing the Application is wasteful of both the resources of Maker Store Pty Ltd and the Commission. It is not difficult for an unfair dismissal applicant to simply advise the Commission that they no longer intend to pursue their claim; in fact, it is courteous to do so. Unfortunately, in this matter this did not occur. [30] For the reasons outlined above, the costs Application is dismissed. COMMISSIONER Printed by authority of the Commonwealth Government Printer <PR811949>