Corporations Act 2001

A person contravenes this subsection if:

the person enters into a relevant agreement or a transaction (within the meaning of subsection 596AB(3)); and

the person knows, or a reasonable person in the position of the person would know, that the relevant agreement or the transaction is likely to:

avoid or prevent the recovery of the entitlements of employees of a company; or

significantly reduce the amount of the entitlements of employees of a company that can be recovered.

This subsection is a civil penalty provision (see section 1317E).

A person who is involved in a contravention of subsection (1) contravenes this subsection.

Section 79 defines involved.

This subsection is a civil penalty provision (see section 1317E).

A person contravenes this subsection if:

the person is an officer of a company; and

the person causes the company to enter into a relevant agreement or a transaction (within the meaning of subsection 596AB(3)); and

the person knows, or a reasonable person in the position of the person would know, that the relevant agreement or the transaction is likely to:

avoid or prevent the recovery of the entitlements of employees of the company; or

significantly reduce the amount of the entitlements of employees of the company that can be recovered.

This subsection is a civil penalty provision (see section 1317E).

A person who is involved in a contravention of subsection (3) contravenes this subsection.

Section 79 defines involved.

This subsection is a civil penalty provision (see section 1317E).

Subsections (1) and (2) apply even if the company is not a party to the relevant agreement or the transaction.

Subsections (1), (2), (3) and (4) apply even if:

the relevant agreement or the transaction is approved by a court; or

the relevant agreement or the transaction has not had the effect or effects mentioned in paragraph (1)(b) or (3)(c), as the case may be; or

despite the relevant agreement or the transaction, the entitlements of the employees of the company are recovered.

However, subsections (1), (2), (3) and (4) do not apply if:

the relevant agreement or the transaction is, or is entered into under:

a compromise or arrangement between the company and its creditors or a class of its creditors, or its members or a class of its members, that is approved by a Court under section 411; or

a deed of company arrangement executed by the company; or

a restructuring plan made by the company; or

a liquidator or provisional liquidator of the company causes the relevant agreement or the transaction to be entered into in the course of winding up the company.

A person who wishes to rely on subsection (7) in a proceeding for, or relating to, a contravention of subsection (1), (2), (3) or (4) bears an evidential burden in relation to that matter.

Proceedings under section 1317E for a declaration of a contravention of this section may only be begun after a liquidator has been appointed to the company.

If a person contravenes this section by incurring a debt (within the meaning of section 588G), the incurring of the debt and the contravention are linked for the purposes of this Act.

If there is a contravention of this section involving a disposition of property of a company that is voidable under subsection 588FE(6B), the disposition and the contravention are linked for the purposes of this Act.

In this section: