Published in (2016) 29 Australian Journal of Labour Law 257 Understanding the phoenix landscape for employees Helen Anderson* The adverse effect of phoenix activity on employees is well-established. Much attention is given to the size of the problem and possible law reform measures to tackle it. This article takes a different approach and looks at the issue from the perspective of an employee affected by phoenix activity. It suggests that an understanding of the political and regulatory environment in which phoenix activity exists is necessary before making suggestions for improvements. These include better transparency and the sharing of information, an emphasis on prevention rather than cure, some minor law reform and a different focus on funding. The article concludes that meaningful gains for employees are hard to achieve without significant structural change. Nonetheless, a proper understanding of the underlying complexities of the phoenix landscape will ensure that reform proposals of whatever size or nature have a better chance of acceptance and success. I Introduction The capacity of phoenix activity to adversely affect the recovery of employee entitlements is well recognised. 1 While there is no generally accepted definition, the concept of phoenix activity broadly centres on the idea of a second company, often newly incorporated, arising from the ashes of its failed predecessor where the second company’s directors and officers and its business are essentially the same. While not all phoenix activity is illegal or even problematic, 2 the abuse of the business rescue process to deliberately shed debts to creditors, including employees and revenue authorities, is of great concern. Government enquiries 3 and scholarly commentary 4 have discussed the relevant legal provisions, and lack of them, at * Professor, Centre for Employment and Labour Relations Law, Melbourne Law School, University of Melbourne. The author thanks the Australian Research Council for its generous support for this research: DP140102277, ‘Phoenix Activity: Regulating Fraudulent Use of the Corporate Form’. The author also thanks the referees for their helpful comments but any errors remain her own. 1 See, eg, Australian Government, Treasury, Action Against Fraudulent Phoenix Activity, Canberra, 2009 (Treasury Phoenix Proposals Paper), at [2.1]; PriceWaterhouseCoopers and Fair Work Ombudsman, Phoenix Activity – Sizing the Problem and Matching Solutions, June 2012 (PWC Report), at 15. 2 H Anderson et al, Defining and Profiling Phoenix Activity, Centre for Corporate Law and Securities Regulation, University of Melbourne, 2014, at [2.2.2]. 3 See, eg, Treasury Phoenix Proposals Paper, above n 1; Parliament of Victoria Law Reform Committee, Curbing the Phoenix Company – First Report on the Law Relating to Directors and Managers of Insolvent Corporations, Report No 83, Melbourne, June 1994; Australian Securities Commission, Project One: Phoenix Activity and Insolvent Trading Public Version, Research Paper 95/01, May 1996, at 39; Parliamentary Joint Committee on Corporations and Financial Services, Parliament of Australia, Corporate Insolvency Laws: A Stocktake, Canberra, 2004; Royal Commission into the Building and Construction Industry, Final Report, 2003, Vol 8, at 111–219. 4 See, eg, the work of H Anderson et al cited at <http://law.unimelb.edu.au/centres/cclsr/research/major- research-projects/regulating-fraudulent-phoenix-activity (accessed 30 September 2016).; see also A Matthew,