Skip to content

Who’s a manager?


Environmental, WHS and many other statutes hold company directors, managers and officers personally liable for corporate transgressions.   Staff often ask whether they are exposed to liability in that way.    But there’s no brightline test to identify which employees are sufficiently concerned in management to attract derivative liability.  That’s why the Victorian Supreme Court decision in Hodgson v Amcor [2012] VSC 94 is useful.

The case resolved a complicated dispute between a company and a former senior manager about his role in the sale of operating assets. Among other things, the company alleged that the manager had breached the Corporations Act.  Although the Court’s reasons are limited to a specific scenario, they provide useful guidance about other legislation.  The Court took into account:

  • the employee’s nominal position within the company
  • the extent to which the employee took part in decisions which affected the company’s high-level business undertakings.
  • the limit of the employee’s capital expenditure authority  (a limit of $250,000 indicated an employee was not an officer  and, in another case, a $10m trading limit meant a trader wasn’t an “officer”).
  • the employee’s reporting line (an officer generally reports directly to the board or is allowed to deal directly with board members)
  • the employee’s capacity to endorse recommendations to the Board (they’re more likely to be an officer if they do).
  • how many others report to the employee and what senior are they (in this case, that the manager headed and managed the largest departmental headcount, resources and revenue in the company)
  • the employee’s accountability and control over a budget
No comments yet

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s