If you run payroll, courts infer you know what's in it
An HR officer who sent a dismissal letter faces continued exposure in a Fair Work civil penalty proceeding after a court declined to strike out the pleadings against her and instead granted the applicant leave to replead.
The Federal Circuit and Family Court's 23 April 2026 decision in Sha v Snap Innovations Pte Ltd has direct implications for HR professionals across Australia.
Nong Sha was employed as a C++ Engineer by Snap Innovations Pte Ltd, a company which represented to him that it was incorporated in Singapore, from 6 November 2023 until 24 January 2025. He worked entirely in Australia, was paid into an Australian bank account and paid tax to the Australian Taxation Office.
During his employment, Sha alleged he was directed by the Chief Technology Officer and Chief Executive Officer to perform substantial work for a separate Australian company, Utrada. After raising questions about working across two entities, he claimed the company cited redundancy but indicated it was conditional: had he agreed to take on the Utrada role, his job would have been retained.
Sha filed proceedings alleging Snap had dismissed him for exercising workplace rights under the Fair Work Act, failed to make superannuation contributions, provided only 14 days of annual leave per year rather than the statutory minimum, and required him to work excessive hours including evenings and weekends.
Alongside Snap, Sha named three individuals: Chief Technology Officer Kerching Choo, HR Officer Crystal Foo and Chief Executive Officer Ting Shang Ping. All three declined to plead to the allegations, invoking their privilege against civil penalty exposure.
Snap sought to strike out the pleadings against the individual respondents, arguing insufficient connection to Australia and inadequate pleading. Judge Doust rejected the connection argument, finding the pleadings disclosed enough facts to go to trial.
Foo's position drew the most attention from an HR perspective. She was not alleged to have decided to dismiss Sha or designed the company's leave and superannuation arrangements. Her involvement, as pleaded, was sending the formal termination notice on 24 December 2024 and a follow-up email on 3 January 2025, confirming the dismissal had been made collectively by management.
On the wrongful dismissal claim under s 340 of the Fair Work Act, the court found the pleadings against Foo and the CEO to be insufficient. As against Foo, the court found Sha had not pleaded sufficient facts to establish that she was part of "management," that she was aware of his exercise of workplace rights, or that she was party to the making of the decision to take adverse action. The same core deficiency, no pleading that either knew of his exercise of workplace rights, was found as against the CEO. Rather than striking out those paragraphs, however, Judge Doust granted the applicant leave to replead, leaving open the possibility that Foo could remain in the proceeding on the dismissal claim if a sufficient amended pleading is filed by 15 May 2026.
On the annual leave and superannuation claims, however, the court reached a different conclusion.
As Judge Doust put it, "However, I do not regard the pleading as fundamentally deficient as it is apparent from the third respondent's administration of the applicant's employment records and payroll that there is a basis to infer the third respondent's knowledge of the failures to pay the amounts payable under the NES."
There was one qualification. Both Foo's and the CEO's NES pleadings used the phrase "was aware, or ought reasonably to have been aware." The court was clear that actual knowledge is required for personal liability, not constructive knowledge, and those words would need to be removed.
The pleading against the CTO was found sufficiently pleaded on both the claims attributed to him: the wrongful dismissal claim and the unreasonable hours NES contravention.
Case law cited in the decision, drawn from Thawley J in Whitby v ZG Operations Australia Pty Ltd (No 2) [2019] FCA 201, draws attention to the personal stakes: "A pleading that a person was knowingly concerned in a contravention, exposing them to personal liability and seeking the imposition of civil penalties, should be drafted with some considerable care."
Sha was granted leave to file an amended originating application and Amended Points of Claim by 15 May 2026. No findings on the merits of any allegation have yet been made.
For HR leaders, the case raises a pointed question: if an employment agreement fails to meet minimum statutory entitlements and you process the payroll, what does a court infer that you knew?
