How one small underpayment spiralled into a major court loss
A Federal Court has ruled a Perth home builder unlawfully dismissed a manager days after he launched a pay case, despite only minor underpayments.
On January 30, 2026, the Federal Court of Australia delivered its decision in Chambers v Broadway Homes Pty Ltd (No 2) [2026] FCA 28. The judgment examines how Broadway Homes dealt with the return, pay and dismissal of Peter Chambers, a senior sales figure in the Delstrat Group.
Chambers worked with Broadway Homes from 2019 until June 2021 as a sales consultant and later as a manager in luxury home sales. After he left in 2021, he pursued claims in the Fair Work Commission over dismissal and unpaid commissions. In July 2022, a Full Bench of the Commission held that he had been an employee, paving the way for settlement.
By late 2022, the parties had agreed on a settlement of $500,000 to resolve the earlier dispute. That sum, reflected in internal spreadsheets and paid in instalments, was split between commissions owed to his mother’s company, Jamrok Pty Ltd, and back pay and superannuation owed directly to Chambers.
The more difficult issue was Chambers’ new role.
In October and November 2022, the parties discussed his return to set up a new division, later branded Katura Homes, as a business name of Broadway Homes. Job titles, salary figures and possible commission structures were canvassed, but the Court found there was no final, binding agreement on the essential terms of future employment at that time.
On January 9, 2023, Chambers started work as General Manager of Katura Homes, based at another Delstrat office. Justice Jackson held that from that date an employment contract existed with Broadway Homes, formed orally or by conduct. Initially, Chambers focused on establishing the new operation. From May 17, 2023, after he was given access to sales leads, his role also involved selling homes under the Katura and Broadway brands.
For the first several fortnights after January 9, 2023, Chambers was paid at a level equivalent to $180,000 per year inclusive of superannuation. From late April 2023, his pay dropped to a level equivalent to $52,000 per year plus super. He challenged the reduction and maintained that his salary should have stayed at $180,000 plus superannuation for at least four years.
The Court rejected that claim and also rejected Broadway’s position that he was entitled only to the lower base. Because the parties had never settled all of the employment terms, Justice Jackson held that Chambers was entitled to reasonable remuneration for the work he performed. From January 9
to May 17, 2023, that meant the higher rate. From May 18, 2023 onwards, it meant a lower base combined with a 4 per cent commission on home sales.
On that basis, the Court identified an underpayment confined to eight days: April 24 and 25, 2023, and six working days between May 10 and May 17, 2023. In the judge’s words, “Broadway Homes underpaid Mr Chambers and so breached s 323 of the FWA for part of the period of his employment in 2023.”
The more serious finding concerned what happened after Chambers complained.
On June 6, 2023, Chambers sent Broadway a detailed letter setting out his understanding of the settlement and employment arrangements and alleging underpayment. He referred to potential breaches of the Fair Work Act and flagged possible proceedings. On June 14, 2023, he lodged a general protections application with the Fair Work Commission.
On June 20, 2023, while that Commission matter was on foot, Chambers received a termination letter signed by Broadway’s operations manager. It stated that his position was no longer required and that his employment would end immediately with two weeks’ pay in lieu of notice. A similar letter signed by a director followed the next day.
Broadway argued in Court that the dismissal was driven by performance and viability concerns: Chambers had made no sales and the Katura Homes venture was not commercially promising. The judge accepted that these concerns existed but examined the timing, the lack of formal performance warnings and the wording of the letters.
Under the Fair Work Act, once an employee alleges they were dismissed because they exercised a workplace right, the employer must prove that was not a reason for the decision. Justice Jackson was not satisfied that Broadway had done so. The Court declared that “the first respondent breached s 340 of the FWA by dismissing the applicant from its employment on or about 20 June 2023 because the applicant had exercised a workplace right by commencing proceeding number C2023/3465 in the Fair Work Commission.”
The Court also held that, in the absence of an agreed fixed term, Chambers’ employment was ongoing and terminable on reasonable notice. In the circumstances, reasonable notice was four weeks, more than the two weeks’ pay he received. Broadway’s director, Mark Basso‑Brusa, was found to be involved in the underpayment and adverse action breaches within the meaning of section 550 of the Fair Work Act. Compensation and penalties will be set at a later hearing.
The judgment highlights the importance of clear written contracts, careful handling of pay complaints and consistent, well‑documented reasons when ending employment.
