Australian Education Union v Bendigo Kangan Institute
[2025] VCC 455
•15 April 2025
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMERCIAL DIVISION | Revised Not Restricted Suitable for Publication |
GENERAL LIST
Case No. CI-23-03585
| AUSTRALIAN EDUCATION UNION (ABN 446 733 986 74) | Plaintiff |
| v | |
| BENDIGO KANGAN INSTITUTE (ABN 748 029 428 86) | Defendant |
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JUDGE: | Her Honour Judge Burchell | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 27 February 2025 | |
DATE OF JUDGMENT: | 15 April 2025 | |
CASE MAY BE CITED AS: | Australian Education Union v Bendigo Kangan Institute | |
MEDIUM NEUTRAL CITATION: | [2025] VCC 455 | |
REASONS FOR JUDGMENT
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Subject:EMPLOYMENT LAW
Catchwords: penalty hearing – contraventions of s 50 of the Fair Work Act 2009 – breaches of Victorian TAFE Teaching Staff Agreement 2018 – claim for declaratory relief – quantum of pecuniary penalty orders
Legislation Cited: Fair Work Act 2009 (Cth), s 50, s 546(1), s 539(2); Evidence Act 1995 (Cth), s 191(2);
Cases Cited:Independent Education Union of Australia v Australian International Academy of Education Inc [2016] FCA 686; Australian Building and Construction Commissioner v Australian Workers’ Union [2021] FCA 861; Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate (2015) 258 CLR 482;Trade Practices Commission v CSR Ltd [1990] FCA 521; Kelly v Fitzpatrick [2007] FCA 1080; Mason v Harrington Corporation Pty Ltd [2007] FMCA 7; Australian Building and Construction Commissioner v Kevin Pattinson & Another [2022] HCA 13; ABCC v AWU (2021) 308 IR 195; Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2013) 250 CLR 640; Creative Smiles Pty Ltd & Anor v Ekera Dental Pty Ltd & Anor (No 2) [2023] VCC 745
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | F Knowles | Australian Education Union |
| For the Defendant | M Felman KC with T Duthie | Lander & Rogers |
HER HONOUR:
Introduction
1 In this proceeding, the plaintiff (“the AEU”) seeks declaratory relief and pecuniary penalty orders to be imposed on the defendant (“BKI”). By consent orders made on 18 December 2024 (as amended by orders made on 4 February 2025), the defendant has admitted to breaching clauses 12.2, 12.8, 12.12, 13.1, 13.2 and 14.1(g) of the Victorian TAFE Teaching Staff Agreement 2018 (“the 2018 Agreement”) and thereby contravening s 50 of the Fair Work Act 2009 (Cth) (“the FW Act”).
2 The parties rely upon a Statement of Agreed Facts (“SOAF”) filed on 6 November 2024. The SOAF contains facts that the parties have agreed, for the purposes of this proceeding, to be undisputed. By virtue of s 191(2) of the Evidence Act 1995 (Cth), evidence is not required to prove these agreed facts.
3 It is the quantification of the penalties to be imposed which presently divides the parties. The AEU and BKI have agreed that orders should be made imposing a pecuniary penalty on BKI within the range of $157,365.60 and $205,346.40. The AEU submits that the appropriate quantification of the penalties should total $205,346.40. Conversely, BKI submits that an order at the lower end of the agreed range of between $157,365.60 and $169,088.80 would be more appropriate.
4 As stated above, the parties agree that BKI contravened six clauses of the 2018 Agreement, and in doing so, contravened s 50 of the FW Act. It is for the Court to determine what pecuniary penalties are appropriate penalties in the circumstances, and whether it is appropriate to make the declarations sought.
5 For the reasons that follow, I am satisfied that it is appropriate to impose the following penalties upon BKI, being:
(a) In contravention of clause 12.2 of the 2018 Agreement – $41,250.00;
(b) In contravention of clause 14.1(g) of the 2018 Agreement – $6,660.00;
(c) In contravention of clause 12.8 of the 2018 Agreement – $65,730.00;
(d) In contravention of clause 12.12 of the 2018 Agreement – $56,340.00;
(e) In contravention of clause 13.1 of the 2018 Agreement – $57,750.00; and
(f) In contravention of clause 13.2 of the 2018 Agreement – $57,750.00.
6 In their written opening submissions filed with the Court, both parties provided their draft proposed form of order. During the penalties hearing, it was common ground that the appropriate order in relation to costs is no order as to costs. Accordingly, I will order no order as to costs.
Background Facts
7 As presented in the SOAF, it is agreed between the parties that:
(a) Mr Sharir Naga is, and since 4 June 2020, has been employed by BKI as a Teacher of Vocational English;
(b) Mr Nicholas Frewen was, between 31 January 2022 and 10 September 2023, employed by BKI as a “Sessional Carpentry Teacher”, between 11 September 2023 and 21 November 2023, employed as a Carpentry Teacher and resigned from his employment with BKI on 21 November 2023; and
(c) The 2018 Agreement is in operation and applies to the AEU, BKI, Mr Naga, Mr Frewen (until his employed ceased) and fixed-term or casual teachers employed by BKI.
Issues
8 In order for the Court to order any pecuniary penalties, it needs to be satisfied that BKI contravened the relevant civil remedy provisions. BKI has six sets of contraventions (together, “the admitted contraventions”), and thus resolved matters of liability. It is now for the Court to determine matters of penalty, rather than assess whether BKI has contravened the FW Act.
9 The parties have jointly submitted issues for determination by the Court as follows:
(a) Is the Court satisfied that BKI contravened the civil remedy provisions of the FW Act which BKI has admitted to contravening?
(b) What form should any declarations of contravention, in respect of the admitted contraventions made by the Court take?
(c) What pecuniary penalties are appropriate for the Court to order under s 546(1) of the FW Act in respect of BKI’s contraventions of the FW Act, noting the parties have put an agreed penalty range to the Court of $157,365.60 – $205,346.40?
(d) For the Court to determine penalties of an appropriate deterrent value, the Court should make factual findings including the following matters:
(i)What were the circumstances in which BKI’s contravening conduct occurred?
(ii)What is the nature of BKI’s contravening conduct?
(iii)Were the admitted contraventions deliberate?
(iv)What has been the level of BKI’s cooperation in respect of its contraventions?
(v)What corrective action has been taken by BKI following its contraventions?
(vi)Does BKI have any prior similar contraventions of the FW Act to those of the admitted contraventions?
(e) Finally, to whom should the Court order that the pecuniary penalties be paid pursuant to s 546(3) of the FW Act, noting that the AEU seeks orders that any pecuniary penalties be paid to it, and this is consented to by BKI?
Submissions
The AEU’s submissions
10 The AEU submitted that the “meat” of the issue for the Court’s determination is what pecuniary penalties are appropriate to be ordered under s 546(1) of the FW Act, in respect of BKI’s admitted contraventions.
11 Predominantly, it is contended that the admitted contraventions breached the 2018 Agreement in relation to insecure employment. There is an overarching commitment to secure ongoing employment.
12 Clause 12.1 of the 2018 Agreement provides:
“12.1 The standard mode of employment for an Employee is ongoing. However, some fixed term or casual employment will be necessary.”
13 The failure of BKI to hold the April 2019 review reflects issues of knowledge and the need for deterrence. The AEU’s interactions with BKI proved to be unfruitful in the past, and such unfruitfulness continued into the matters which are the subject of the admitted contraventions.
14 The AEU refers to Mr Michael McIver’s evidence, stating that BKI failed to conduct the April 2019 review – which was agreed in the parties’ chronology. The AEU wrote to BKI’s Acting CEO, Mr Phil Murphy on 2 August 2019, communicating, relevantly:
“Further it appears that BKI has not complied with its obligations in relation to conversion of employees from lesser to more secure employment. BKI did not conduct a review of fixed term and casual employees in April 2019 as it was required to do.
It appears that these contraventions are systematic and are wilful. BKI's approach to implementing the 2018 Agreement suggests that the Institute has taken the view that compliance with the 2018 Agreement is optional. This conduct has caused, and is causing, significant distress to AEU members. The AEU will continue to provide advice to members regarding their rights and BKI's obligations under relevant provisions of the 2018 Agreement and the Occupational Health and Safety Act 2004.”
15 On 8 August 2019, BKI’s response outlined budgetary constraints as follows:
“As you [AEU] would know, in March our then Chief Executive Officer resigned and the Chief Organisational Capability Officer became absent from BKI TAFE for an extended and continuing period.
In April, during the review of our first quarter financial results it was identified that BKI TAFE was required to immediately undertake a review of its budget across the organisation and that whilst this occurred a recruitment freeze would be imposed. I addressed our staff and both NTEU and AEU representatives including Ms Gillespie and explained our circumstances.”
16 The AEU outlines the nature of BKI’s contravening conduct, addressing each of the six sets of admitted contraventions, stating:
(a) The first contravention concerns fixed-term employment contracts, whereby BKI contravened clause 12.2 of the 2018 Agreement by engaging Mr Naga on a maximum-term basis, rather than a fixed-term basis on six separate occasions. The AEU noted that the six occasions had been agreed by parties to be treated as a single course of conduct. By engaging Mr Naga on a maximum-term basis, the AEU contends that it rendered his employment less secure as his contract was terminable on notice. This, for the AEU, is a contravention that is serious;
(b) The second contravention involves Mr Frewen’s casual employment status, and BKI’s failure provide him with a letter of appointment according to the requirements in the 2018 Agreement. Clause 14.1(g) provides that “[o]n appointment the Employer will provide Employees with a letter of appointment which stipulates the type of employment and contains the following information … for each casual Employees, the duties required, the estimated number of hours required, the rate of pay for each class of duty required and a statement that any additional duties required during the term will be paid for.” The AEU submits that the purpose of clause 14.1(g) is to provide a level of certainty for the employee about the number of casual hours estimated to be required – and BKI’s broad misuse of casual labour in respect to Mr Frewen is emblematic of such a contravention;
(c) The third contravention is in respect of BKI employing Mr Frewen as a “genuine industry expert”, allowing them to engage him (whilst being a casual employee) for longer than 13 weeks in a 12-month period. BKI admitted that Mr Frewen was not a genuine industry expert – he was engaged to teach carpentry, and was not even a licensed carpenter. The AEU submits that BKI’s use of Mr Frewen as a genuine industry expert, was a device to circumvent the 13 week limit. Mr Frewen was engaged for 44 weeks in a 12-month period between 31 January 2022 and 30 January 2023, and 29 weeks in the period between 31 January 2023 and 10 September 2023;
(d) The fourth contravention involves the engagement of casual employees to teach more than 40 hours in a two week period, contravening clause 12.12 of the 2018 Agreement. BKI engaged Mr Frewen for more than 40 hours of teaching in eight separate two-week periods between July 2022 and September 2023. The AEU argues it is an aggravating factor that senior management employees were involved in the contravention, as Mr Joe Ballato, Executive Director of Studies at BKI, had to approve for the engagement of Mr Frewen for more than 40 hours in a two-week period;
(e) The fifth contravention involves BKI’s failure to offer Mr Frewen ongoing employment, contravening clause 13.1 of the 2018 Agreement. BKI failed to offer Mr Frewen ongoing employment where a suitable ongoing position was available at all times between the period of 30 January 2023 and 5 September 2023. Again, the AEU notes that senior management employees were involved in this contravention and, when this was raised with BKI, the AEU observed a lack of urgency as to addressing the matter. BKI did not voluntarily comply when the AEU initially raised such issues with them, making this a contravention of a serious nature; and
(f) The sixth contravention concerns the failure to conduct the April 2023 review. The AEU outlines that the purpose of such a review was to mandate an annual process of identifying those employees who were engaged in insecure employment modes, and matching them to suitable ongoing employment positions where available. The review was designed to act as a check and balance on non-preferred modes of employment and manage such situations. The AEU asserts that the failure to engage in the review process, to identify and rectify non-preferred situations, needlessly extended the insecure engagement of a large number of people. When BKI conducted the review, of the 156 affected teachers, 33 indicated they wished to convert to ongoing employment positions.
17 The AEU’s position is that there were different states of mind relevant to each of the contraventions. In particular, the AEU contends that the clause 12.12 contraventions involved deliberate methods of flouting of the limits of casual engagement in certain time periods, with senior members of staff, such as Mr Ballato, involved in the contravention.
18 The AEU further submits that BKI treated the April 2023 review as an optional exercise, and such non-compliance did not occur accidentally. It is argued that BKI did not institute a proper system of compliance, thus allowing for a series of contraventions to occur. The AEU notes that the evidence of Ms Johnson under cross-examination indicated that there was an awareness the 2023 Review had not been done in May 2023, and it was agreed between parties that it was only completed in August 2023.
19 Treating obligations under the 2018 Agreement as optional, in terms of compliance, allowed for the excessive use of casual labour and facilitated a situation whereby not offering conversions to ongoing employment was the norm.
20 The AEU noted, throughout, that non-compliance does not occur by accident. The totality of the evidence indicates there were disadvantages in BKI utilising ongoing employment. The AEU refers to Ms Johnston’s evidence, stating that if no teaching work is available, BKI have to shoulder the cost of paying staff members on ongoing employment contracts. Therefore, BKI used casual labour as a method of reducing costs.
21 The AEU acknowledges that, by BKI admitting the contraventions, they have reduced the cost and complexity of contested proceedings. Accordingly, the AEU have adopted a 20% cooperation discount to acknowledge a level of contrition shown by BKI. This is agreed between parties.
22 The AEU also concedes that BKI has taken steps to ameliorate the disadvantage experienced by the 33 teachers who were belatedly converted to ongoing employment by backdating entitlements, had the review occurred in April 2023. Notwithstanding this acknowledgement, AEU submits that the corrective action was still inadequate. Referring to the cross-examination of Mr Bradley Nash, the AEU note that the email dated 20 January 2024, sent to two executive directors of teaching delivery by Mr Nash, contained a rider for discretion on a case-by-case basis to not comply. It was put to Mr Nash that “you’ve left open the possibility of considering teaching in excess of those hours on a case-by-case basis, haven’t you?”. The AEU contend that Mr Nash agreed with the proposition put to him.
23 According to the AEU, BKI’s willingness take responsibility for the contraventions, does show a level of contrition and remorse. However, it is noted that no individual took responsibility for the contraventions, highlighting a continued need for specific deterrence.
24 The AEU accepts that BKI was not found to have committed any prior similar contraventions of the FW Act, and notes that the lack of prior contraventions was a factor in the AEU consenting to mid-range penalties.
25 The AEU refers to the table annexed to my orders dated 4 February 2025, stating the top of the penalty range for each of the contraventions listed are appropriate. Specifically, the AEU, as a regulator, brings this action to send a message to other potential contraveners as to the seriousness of these circumstances.
26 Finally, the AEU asserts that the contraventions in regard to maximum term contracts may not be deliberate, but does cavil with the characterisation of them as “inadvertent”. The contraventions occurred in the context of inadequate measures to ensure compliance – and any corrective action was inadequate.
27 Citing Jessup J in Independent Education Union of Australia v Australian International Academy of Education Inc,[1] the AEU notes that seriousness is not to be assessed by reference to material impact.
[1] [2016] FCA 686 at [18]-[19] (“Independent Education Union”).
28 In relation to Mr Frewen signing a form that stated he was an industry expert and that his skills were in demand, the AEU state that the inclusion of “and/or you are able to commit to regular permanent employment with BKI” (emphasis added) means that Mr Frewen may have advised he was an industry expert and his skills were in demand, but did not say he was unable to commit to regular permanent employment. The drafting of the form makes the final point unclear and difficult to determine.
BKI’s submissions
29 BKI presented the context around the background circumstances of the admitted contraventions as:
(a) Within a highly regulated environment, as BKI cannot elect to run, or not run, a course without consultation or approval by either the relevant regulatory or government authority. This results in staffing challenges. BKI’s courses are taught on a rolling basis, with potentially multiple intakes a year. It is difficult to predict how many students BKI are going to have enrolled. As student enrolments are difficult to predict, but all staffing decisions have been made, BKI submits there is a situation where there is excess or not enough staff members. If this is the case, BKI engages individuals on fixed-term contracts, or casually, for flexibility purposes.
(b) BKI needs permission from the regulatory or government authority to make staff redundant. Therefore, in a situation where BKI has engaged not enough staff for the amount of enrolments – they wrongly engage people to work more than their permitted hours. BKI submitted that these contraventions do not all arise for a reason, but can be inadvertent and based on confusion.
(c) The 2018 Agreement is inappropriate for an entity like BKI to adhere to. BKI considered it to be analogous to a “square peg in a round hole” situation.
(d) Structural challenges including COVID-19 and an organisational program (the North Star program) that resulted in enrolment uncertainty and challenges in how courses were delivered. The North Star program was designed to improve BKI’s efficiency, effectiveness and sustainability, which resulted in 161 redundancies and a reduction in director portfolios. Such uncertainty was particularly felt in the HR Department. BKI labelled the staffing situation as a “shemozzle”, but not a deliberate design to subvert the 2018 Agreement.
30 BKI did not renounce the purposes of the 2018 Agreement and notes that security of employment is an important objective. It was contended that elements of Mr McIver’s witness statement refer to job security as much as flexibility and BKI relies on Mr McIver’s statement to indicate the environment is one where there is a balancing exercise between job security and flexibility – and that the 2018 Agreement attempts to strike that balance.
31 In addressing the first contravention, BKI accepts that the inclusion of a termination clause in a fixed-term contract technically transforms the contract into maximum-term. Citing a lack of appreciation as to the difference between a fixed and maximum term contract, BKI contend this was an inadvertent and relatively minor breach.
32 Reflecting on corrective action undertaken, BKI states it has since rolled out new fixed term contracts and notes that, at common law, an employer is entitled to terminate a fixed-term contract for serious misconduct.
33 BKI also contends that this is not a case about job insecurity and that this debate is not to be had in this forum. There is no evidence before the Court that Mr Naga or Mr Frewen suffered any loss, any damages or experienced the effects of any psychosocial hazard from having a termination clause included.
34 It is submitted that BKI sought legal assistance from its solicitors, Landers & Rodgers, to review and update the casual contract templates.
35 BKI disagrees with the characterisation of the breach of clause 14.1(g) as “subversion”. It admitted that there was a failure of BKI to provide Mr Frewen with information required to be included in the contract template, but such a failure did not result in any confusion. There was no evidence before the Court that Mr Frewen was unclear on his remuneration and the scope of his duties.
36 The contravention of clause 12.8 (read together with clause 12.9), is submitted by BKI to have occurred in nuanced and complex circumstances. Mr Frewen signed a form stating that he was an expert and sent in a resume detailing qualifications in carpentry. BKI now accepts that Mr Frewen may not have wanted to sign the form. BKI generally refers to a state of confusion as to how to define “expert” and again, sought advice from Landers & Rodgers in an attempt to rectify this issue.
37 BKI admits that it contravened clause 12.12 on eight occasions, but notes that it was running out of staff and wanted to keep classes open. It is argued that such a reason was non-capricious and non-arbitrary and renders these contraventions less serious.
38 BKI referred to Bromberg J’s decision in Australian Building and Construction Commissioner v Australian Workers’ Union,[2] stating that the “absence of enduring loss or damage diminishes the seriousness of the respondent’s contraventions”. Utilising Bromberg J’s reasoning, BKI disputes that its contraventions are at a level of seriousness that is on the upper level of the penalty range.
[2] [2021] FCA 861 at [32] (“ABCC v AWU”).
39 In relation to the contravention of clause 13.1, Mr Frewen was ultimately offered ongoing employment with BKI on 1 September 2023. BKI submits, in mitigation, that there has been a new automatic trigger reminder system embedded into the human resources payroll due to go live in late May or early June 2025.
40 Further, in relation to the failure to conduct the 2023 Review under clause 13.2, BKI contends that the review was eventually undertaken and only two out of the 55 who were offered ongoing employment accepted the offer. There was unchallenged evidence at the time the 2023 Review ought to have been conducted, that BKI’s human resources team was experiencing a state of significant flux and uncertainty, with a loss of leadership and expertise creating a sense of confusion. It was not a deliberate attempt to avoid their obligations and is of minimal significance. A review was conducted in 2020, 2021, 2022 and ultimately in August 2023 – after the contravention in April 2023. BKI argues that the evidence does not support a conclusion where it is a norm or practice of BKI not to engage in the review.
41 BKI accepted that its submissions outlined above are to provide context rather than excuses. Further, it is recognised that the conversion review is a high priority and important and should have been completed in April 2023.
42 Mr Bradley Nash has been allocated the ongoing responsibility to ensure the review occurs yearly, and Ms Johnson has set a personal reminder each year so that she can personally ensure future reviews are conducted in compliance with clause 13.2.
43 BKI contends there was no loss and there are no prior contraventions. As there have been no prior contraventions, the need for deterrence looms less large given BKI is a first-time offender. Ms Johnson, as senior BKI employee, also personally expressed contrition.
44 BKI’s corrective action is ongoing and there was an acknowledgement that it may be “imperfect”. It is contended that BKI has learnt its lesson, and is continuing to fix the problem to prevent any contraventions from occurring again. Further, it was argued that civil penalties have the single objective of deterrence, in contrast to criminal punishment.
45 A cooperation discount has been agreed upon between parties.
46 Finally, BKI asserts that the FW Act requires the Court to impose a penalty for each contravention and that it would be an error for the Court to provide a single figure of penalties, as well as requests that payment be made within 30 days.
The witnesses
Michael McIver
47 The evidence in chief of Michael Joseph McIver, Manager of the Industrial Department of the AEU, was tendered by way of witness statement and he was not required for cross-examination.
Michael Fry
48 The evidence in chief of Mr Michael Fry, Education Manager of BKI, was tendered by way of witness statement and he was not required for cross-examination.
Michelle Johnston
49 Ms Michelle Nicole Johnston, Chief Operating Officer (“COO”) of BKI, provided her evidence in chief by way of witness statement and was required for cross-examination.
50 Ms Johnson presented as a careful and considered witness.
51 Prior to her appointment as COO on 1 January 2025, Ms Johnston was the Chief People, Brand and Strategy Officer at BKI from July 2023 to January 2025, and the Chief People, Culture and Strategy Officer at BKI from January 2021 to July 2023. Between January 2021 to July 2023, she also occasionally performed the Chief Executive Officer role in an acting capacity.
52 In her role as Chief People, Brand and Strategy Officer, Ms Johnson was responsible for managing BKI’s People & Culture function, including workforce planning, organisational capability, cultural development, and health, safety and wellbeing and accountability for the teams that function within such branches. In this current role, Ms Jonhson manages BKI’s strategic and operation functions. Further, Ms Johnson is the Executive accountable for the Finance, Risk and Audit Committee, and the Governance and Culture Committee. Ms Johnson’s current position has nine direct reports.
53 In cross-examination, Ms Johnson noted she became aware that parties in this proceeding agree that BKI had failed to conduct the April 2019 review, as required under clause 13.2 of the 2018 Agreement, when the Court Book for the proceeding was published on approximately 20 February 2025.
54 There was a process in place to ensure compliance with the obligation to conduct a review in 2020 and 2021, and such processes were completed on time in those instances. Ms Johnston noted that she was unaware at the time that the processes instituted to ensure compliance in 2020 and 2021 were in response to the contravention in 2019.
55 Ms Johnson noted that whilst she did not personally participate in the review in 2021 and 2022, she was accountable for it.
56 On 18 May 2023, Mr Ian Grinter sent an email to Ms Johnston and Mr Joe Ballato, referring to conversion to ongoing employment under clause 13 of the 2018 Agreement, requesting that representatives from the AEU be informed as to what particular barriers to conversion exist. On 19 May 2023, Ms Johnston replied to Mr Grinter and asked if there was time available on that day, to “work through the items”.
57 On 22 May 2023, Ms Johnston, Mr Grinter and Mr Ballato attended the Multi Enterprise Agreement Implementation Group (“MEAIG”) meeting.
58 Afterwards, on 2 June 2023, Mr Grinter emailed Ms Johnston referring to discussion in the MEAIG meeting asking if there was any reason conversion was not occurring. Ms Johnson responded stating she was not aware of any reason of why conversion should not be occurring.
59 Ms Johnston was pressed as to BKI’s action in response to items identified by Mr Grinter from May 2023, contending that she wrote an email to her team saying that BKI “needed conversions”. This was when Ms Johnson became aware that conversion was not occurring. It was further admitted that, given these conversations were occurring in May 2023, the April 2023 review had not occurred and that conversion issues were arising as a result of the review not being completed.
60 Ms Johnston was taken to paragraph 124 of her witness statement where she stated that she was:
“… not aware the 2023 Review was not completed in April 2023, (as required by clause 13.2 of the Agreement), despite this being BKI’s usual practice and my expectation”.
It was clarified that, Ms Johnston did become aware in May 2023 that the April 2023 review had not be completed.
61 Ms Johnston confirmed that BKI’s ability to use fixed term and casual staff is of benefit to BKI to maximise flexibility and efficiency. It was put to Ms Johnston that, if BKI used ongoing employment, they would not need to use casual labour in excess of the clause 12.12 arrangements. In response, Mr Johnston stated that, there is a still a restriction on the hours that a teacher can work under the 2018 Agreement and such a restriction does not matter across the different classifications. Ongoing employees can only do so many hours of teaching and may only be able to teach for approximately 20 hours weekly (after time for professional development and planning is accounted for).
62 Ms Johnston agreed that, if BKI had to cancel classes due to a limitation on teaching hours, this would have reputational effects. Further, if the student did not attend class, it causes an inconvenience to both BKI and the student, as study time is elongated, and payout of government funding is also extended.
Bradley Nash
63 Mr Bradley John Nash, Workplace Relations Partner of BKI, provided his evidence in chief by way of witness statement and was cross-examined.
64 Mr Nash has been employed as a Workplace Relations Partner at BKI since 25 March 2024.
65 During examination-in-chief, Mr Nash clarified paragraph 13 of his witness statement, noting that the rectification work is ongoing, rather than completed.
66 In cross-examination, Mr Nash was directed to an email dated 27 November 2024, whereby he requested Ms Kerrie Gibson, the senior payroll manager at BKI, to provide “a written assurance that we’ve removed this exemption process and casual teachers will only be permitted to work the hours as specified in the agreement.” Included in this correspondence, was a table drawn up by BKI’s solicitors, Landers & Rodgers, whereby Mr Nash included in red commentary:
“… make immediate changes to prevent any further exemptions in future, in respect of both the 21 hour and the 40 hour caps on casual teaching hours for casual teaching staff”.
67 Mr Nash was then taken to email correspondence dated 20 January 2025, to Ms Jodie Scoble, an Executive Director at BKI, Mr Ballato and Ms Anne Howard, an Acting Executive Director of BKI at the time. The email states:
“One of the issues that arose in the recent and ongoing County Court matter was the use of casual employees and then teaching well over and above the MEA limits. We are due back in the County Court late February 2025 to finalise this matter and we need to be able to inform the Court that we have addressed the non-compliance issues which are the subject of this matter. As a result, I have asked Payroll to not accept exemptions automatically as may have previously occurred but that we would consider these on a case-by-case basis. We need to ensure that we are only using an exemption such as this at times of last resort rather than common practice.”
68 Mr Nash noted that previously, there was no oversight from the People & Culture team as to employment arrangements with teachers. He sought to ensure that genuine industry experts are actually genuine, and that there was a process put in place for that. Mr Nash also wanted a remediation plan in place, addressing what BKI was going to do to correct hours of casual teaching staff. Currently, Mr Nash is consulted by the payroll department if any issues arise regarding casual hours.
69 Mr Nash accepted that the possibility of teaching in excess of casual hours may be considered on a case-by-case basis, for BKI to examine the situation it is facing.
Analysis
70 As previously noted above, it is common ground and admitted by BKI that it contravened six clauses of the 2018 Agreement. However, what is not agreed is the quantification of the penalties.
The statutory framework
71 Section 546(1) of the FW Act allows the Court to order that a person pay a pecuniary penalty that the Court considers be “appropriate”, if the Court is satisfied the person has contravened a “civil remedy provision”. That expression is defined in s 539(2) of the FW Act and includes the provisions identified in column 1 of the table to s 539(2) of the FW Act. Column 1 includes s 44 and s 45 of the FW Act. It is well settled that these civil penalty provisions have a statutory function of securing compliance with the statutory regime.[3] The AEU, as an employee organisation to which the 2018 Agreement applies, is an eligible persons to bring proceedings of this nature pursuant to s 539(2) of the FW Act.
[3] Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate (2015) 258 CLR 482 at [24].
72 Further, an eligible State or Territory Court is defined as a “District, County or Local Court”.
73 Subsection 546(2) of the FW Act provides that the pecuniary penalty the Court may impose must not, where the person is an individual, be more than “the maximum number of penalty units referred to in the relevant item in column 4 of the table in subsection 539(2)”, and, if the person is a “body corporate”, must not be more than five times “the maximum penalty units specified in the table in s 39(2) of the FW Act.
Principles
74 In Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate, French CJ, Kiefel, Bell, Nettle and Gordon JJ agreed that there was a significant public policy framework necessary to promote the predictability of outcomes in civil penalty proceeding.[4] Further, subject to the Court being sufficiently persuaded of the accuracy of the parties’ agreement as to facts and consequences, and that the penalty to which the parties propose is an appropriate penalty, it is “high desirable” for the Court to accept the parties’ proposal and impose the agreed penalty.[5] The majority in the Agreed Penalties Case (citing French J (as he then was) in Trade Practices Commission v CSR Ltd[6]) noted that the principal objective of civil penalties was to attempt to “put a price on contravention that it is sufficiently high to deter repetition by the contravenor and by others who might be tempted to contravene the Act”.
[4] (2015) 258 CLR 482 at [46] (“Agreed Penalties Case”).
[5] Ibid at [58].
[6] [1990] FCA 521 at [40].
75 Relevantly, if the agreed penalty is within a permissible range, where it cannot necessarily be said to be more appropriate than another, the Court should not depart from the agreed penalty merely because it might have been disposed to select another figure.[7]
[7]The Agreed Penalties Case at [47].
76 In Kelly v Fitzpatrick, Tracey J set out a list of factors which a Court can properly take into account when addressing questions of penalty. These factors include:
(a) The nature and extent of the conduct which lead to the breaches;
(b) The circumstances in which that conduct took place;
(c) The nature and extent of any losses and damage sustained as a result of the breaches;
(d) Whether there had been similar previous conduct by the respondent;
(e) Whether the breaches were properly distinct or arose out of the one course of conduct;
(f) The size of the business enterprise involved;
(g) Whether or not the breaches were deliberate;
(h) Whether senior management was involved in the breaches;
(i) Whether the party committing the breach has exhibited contrition;
(j) Whether the party committing the breach had taken corrective action;
(k) Whether the party committing the breach had cooperated with the enforcement authorities;
(l) The need to ensure compliance with minimum standards by provision of an effective means for investigation and enforcement of employee entitlements; and
(m) The need for specific and general deterrence.[8]
[8] [2007] FCA 1080, citing Mason v Harrington Corporation Pty Ltd [2007] FMCA 7 per Mowbray FM.
77 The majority judgment of the High Court in Australian Building and Construction Commissioner v Kevin Pattinson & Another finds that it is important not to consider the above factors as “rigid catalogue of matters for attention as if it was a legal checklist”.[9] The Court’s primary task is to determine what is an “appropriate” penalty in the context of the particular facts presented. Justice Bromberg in ABCC v AWU also noted that such lists are usual guidance, but not to be “slavishly applied”.[10]
[9] [2022] HCA 13 at [19] per Kiefel CJ, Gageler, Keane, Gordon, Steward and Gleeson JJ (“Pattinson”).
[10]ABCC v AWU [2021] FCA 861 at [28].
78 Chief Justice Kiefel and Gageler, Keane, Gordon, Steward and Gleeson JJ in Pattinson relevantly noted that:
“where a contravention is an example of adherence to a strategy of choosing to pay a penalty in preference to obeying the law, the court may reasonably fix a penalty at the maximum set by statute with a view to making continued adherence to that strategy in the ongoing conduct of the contravener’s affairs as unattractive as it is open to the court to reasonably to do.” [11] [emphasis added]
[11] Pattinson at [50].
79 In Pattinson, a sub-contractor was engaged to install solar panels at a building site. Two of the sub-contractors employees arrived at the site and had to undergo an induction by Pattinson, who asked if they belonged to the union and if they had “tickets”. This was colloquially referred to the Construction, Forestry, Maritime, Mining and Energy Union’s (“CFMMEU”) “no ticket, no start” policy, whereby workers were to be CFMMEU union members, where there was a CFMMEU presence on site. This policy was deemed unlawful, and the Australian Building and Construction Commissioner (“the ABCC”) commenced civil penalty proceedings against Pattinson and the CFMMEU.
80 Alongside the points above, the plurality further acknowledged that civil penalties are primarily imposed, if not predominantly for, the purpose of deterrence. The imposition of a “financial disincentive” in the form of a pecuniary penalty looks to encourage compliance, and signal that contravention is an “economically irrational choice”.[12] In consideration of the overall circumstances, where contravention is a “one-off result of inadvertence”, it may be reasonable to order a modest penalty and it will still be sufficient to provide effective deterrence.[13]
[12] Ibid at [66].
[13] Ibid at [46].
81 The plurality further warned of an overreliance on retributive considerations (akin to those found in criminal sentencing principles) and limited the notion of proportionality employed by the Full Federal Court.[14]
[14] Ibid at [38], [42].
82 Justice Bromberg in ABCC v AWU commented on the necessary balance to strike between specific deterrence and general deterrence, and imposing civil penalties. It has been frequently observed that a pecuniary penalty must be fixed in regard to ensuring the penalty is not considered as an “appropriate cost of doing business”.[15] General deterrence is directed at “sending a message to a broader audience”, as to the serious nature of the contraventions.[16]
[15]ABCC v AWU at [27], citing French CJ, Crennan, Bell and Keane JJ in Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2013) 250 CLR 640 at [66].
[16] Ibid.
83 In Creative Smiles Pty Ltd & Anor v Ekera Dental Pty Ltd & Anor (No 2)[17], Judge Cosgrave (as his Honour then was) deftly analysed the purpose of the statutory penalties under the FW Act, and the nature of the contraventions of the defendant. In this case, his Honour found that the defendant’s contraventions arose not from deliberate intention, but inadvertence. The lack of deliberate recalcitrance allowed his Honour to distinguish the facts of Creative Smiles (No 2), to find that the statutory purpose would not be advanced in penalising the defendant significantly – nor realise the relevant deterrent effect.
[17] [2023] VCC 745 at [83].
84 Finally, in Independent Education Union, Jessup J summarised that seriousness is not to be assessed by reference to material impact, stating that:
The seriousness of these contraventions is not to be located as far towards the lower end of the spectrum as I considered appropriate in the case of the contraventions of cl 10.2(c). The evil to the avoidance of which cl 10.6 appears to be directed is the unrestrained use of fixed-term employment contracts, with the self-evident consequences for security of employment which that would bring with it. Whatever the purpose of the provision, it must be accepted that the award-maker considered it desirable to place strict limits on such a practice. The administration of those limits in practical settings must necessarily be the responsibility of the employer concerned. The way it was done in the present case, and the terms of the Academy’s appointment letters, tended to conceal the extent of its entitlement to proceed in this way consistently with cl 10.6. The fact that the Academy put the applicants to their proof, while undoubtedly its entitlement in penal litigation, did nothing to lay the groundwork for a submission that the court should take a lenient view of the contraventions."
"It was submitted on behalf of the respondents that no individual employee could be said to have suffered loss as a result of the Academy’s contraventions of cl 10.6. Indeed, it was said that the nine teachers in respect of whom the contraventions occurred might not have been employed at all if the Academy had carefully attended to its obligations under the award. Since the contravening acts were ones of commission - involving the employment of teachers - that point was, strictly, well-made so far as it went. But it went nowhere towards addressing considerations of the kind referred to in the previous paragraph. The inherent seriousness of the contraventions is not, in my view, to be measured only, or even mainly, by reference to the material impact which they had on the teachers concerned."[18]
[18] [2016] FCA 686 at [18]-[19].
85 For completeness, each admitted contravention will be analysed individually. In reference to the agreed penalty range in Annexure A, a penalty figure will be determined against each admitted contravention. It is not for the Court to impose penalties that exceed the penalty range as agreed between parties.[19]
[19]Agreed Penalties Case.
86 Additionally, it should be noted that BKI has agreed that it should pay some penalties. Whilst, it is not agreed between the parties as to the scale of the penalties, it is agreed that BKI has contravened the 2018 Agreement and is liable to pay civil penalties as a consequence.
Clause 12.2 of the 2018 Agreement
87 The AEU submitted this contravention was serious, and as such, BKI should be subject to penalties at the top of the agreed penalty range (being 70%, equalling $65,730.00). In engaging Mr Naga on a maximum term basis on six occasions between June 2020 and December 2023, BKI contravened s 50 of the FW Act – and arguably undermined the objective of secure employment. BKI submits that the lack of deliberateness coupled with a lack of appreciation of the difference between fixed term contracts and maximum term contracts goes against an order in the higher end of the maximum penalty range.
88 I accept BKI’s general premise that it operates in a highly regulated environment and oftentimes finds itself subject to bureaucratic checks that are difficult to navigate. BKI cannot elect to run or not run a course as it chooses – and can only offer courses that are within the scope of its registration with the Australian Skills Quality Authority (“ASQA”) and the Victorian Registration and Qualification Authority (“VRQA”). To add or remove courses from its offering, change delivery locations, course duration and delivery formats, BKI must make an application to ASQA. BKI cannot remove a course from offering if there is low attendance, but must go through multiple levels of government approval.
89 This is a distinct reality I do not oppose the existence of, and evidence of this as led by the defendant was not seriously challenged by the plaintiff. However, BKI is one of Victoria’s largest providers of vocational education and training, operating across nine campuses and employing approximately 1,400 members of staff. Further, BKI delivers approximate 200 courses across various education levels, teaching approximately 35,000 students yearly. The purpose of these proceedings, from the AEU’s perspective, is to ensure institutional compliance with the 2018 Agreement. Arguably, all institutions subject to the 2018 Agreement are ruled by similar constraints and all must undertake to comply with the 2018 Agreement notwithstanding such difficulties.
90 Whilst I understand there is a high threshold requirement for labelling conduct as deliberate, it is difficult to consider this conduct as merely inadvertent. In balancing the totality of principles in Kelly v Fitzpatrick (as directed by the majority in Pattinson), I note BKI’s relative power in the vocational and educational industry, coupled with the frequency in which Mr Naga was engaged on a maximum term basis (across two years), as well as the repeated involvement of BKI’s People and Culture team in utilising fixed term employment templates that allowed for termination of employment on notice (thus creating maximum term contracts). Against this is the unchallenged evidence led by BKI that Landers & Rogers has undergone an extensive review of all existing staff on fixed term contracts, and communicated to staff on fixed term contracts, that BKI would not seek to rely on the relevant termination clause. BKI has also rolled out new fixed term contracts, correcting the termination clause issue.
91 BKI submitted that the AEU did not tender any evidence from employees indicating that they suffered any loss, any damage, or any psychosocial hazard as a result of having a termination clause that was not relied upon. Further, BKI emphasised the minor nature of this breach – BKI put a termination clause in a fixed-term contract.
92 It is unlikely the highly regulated environment that BKI, and other similar vocational educational institutions find themselves in, will change drastically. The pressures faced by these institutions are also unlikely to be alleviated – thus, necessitating considerations of general deterrence to prevent repeated contraventions.
93 Accounting for Ms Johnson’s expression of contrition, and the effort detailed by Mr Nash to established mechanisms to ensure no future of repetition of the breaches which have led to the present proceeding, in my view it is appropriate to impose a penalty of 50% of the agreed penalty range, being $41,250.00.
Clause 14.1(g) of the 2018 Agreement
94 This clause required BKI to provide a letter of appointment to Mr Frewen upon his engagement that relevantly contained an estimate of the number of hours for which Mr Frewen was likely to be required and that additional duties required would be paid for.
95 In November 2024, BKI has since, through assistance from Landers & Rodgers, reviewed and updated its casual employment contract template.
96 The parties did not provide an agreed penalty range for this contravention, but instead agreed on an agreed penalty of 10% of the maximum (being $6,660.00). This was undisputed at trial.
Clause 12.8 of the 2018 Agreement
97 The AEU argued that BKI treated Mr Frewen incorrectly as an industry expert, and has since admitted he was not a genuine industry expert.
98 It is agreed between parties that Mr Frewen was not a “genuine industry expert” within the meaning of clause 12.9 of the 2018 Agreement. Mr Frewen was engaged on a casual basis for a period of greater than 13 weeks within a 12-month period, on each week that BKI so engaged him between 2 May 2022 and 30 January 2023, and 2 May 2023, and 10 September 2023.
99 An aggravating feature of this contravention was that senior management was directly involved. Mr Ballato provided the approval on four relevant occasions across 22 July 2022 to 20 March 2023, and allowed Mr Frewen to teach in excess of 40 hours in a two-week period. Such actions of Mr Ballato forms part of the agreed chronology submitted by parties to this present proceeding.
100 I accept the AEU’s submission that the form Mr Frewen signed to assert his status as a “genuine industry expert” was easily misinterpreted given the use of “and/or”. The form relevantly states as follows:
“You have advised that you are an expert in the field of our vocational delivery (industry expert), your skills are in demand and/or you are unable to commit to regular permanent employment with BKI.”
101 Mr Frewen’s signature on this document, without hearing his subjective intention, cannot be objectively construed as an awareness of guaranteeing his status as a “genuine industry expert” and may have simply been stating he was unable to commit to ongoing employment at the time. The conjunctive requirement of “and/or” allows for one requirement to be true, and the other not to be.
102 Again, BKI submitted it has sought advice from Landers & Rodgers as to how to navigate the interpretation of “genuine industry expert” going forward. During the course of the hearing, BKI also contended that (as per the unchallenged evidence in paragraphs 43 to 44 of Mr Nash’s witness statement) that there is an in-principle agreement to remove clauses 12.8 and 12.9 in the new enterprise agreement, given the confusion related to the definition of a “genuine industry expert”. In response, the AEU stated that there have been objections in relation to the change of the expert clauses, and any such discussion has occurred on a “without prejudice” basis. Given these submissions, I have not considered the status of future enterprise bargaining negotiation in relation to the expert clauses.
103 However, the repeated involvement of senior management cannot be discounted as a significant aggravating feature, and necessitates specific deterrence considerations – justifying the imposition of the maximum penalty of the agreed penalty range, being $65,730.00.
Clause 12.12 of the 2018 Agreement
104 By engaging Mr Frewen for greater than 40 hours of teaching in eight separate two-week periods between July 2022 and September 2023, BKI contravened clause 12.12 of the 2018 Agreement in breaching the cap on casual employment.
105 The AEU submits such breaches were deliberate, as there was a distinct system of engaging individuals as a way to get around the cap – BKI utilised the exemption to flout the limits. Similar to the contravention of clause 12.8, this occurred in circumstances where Mr Ballato was approving the extensions for Mr Frewen, and he was a senior employee of BKI.
106 Mr Fry’s evidence was that BKI was running out of staff and wanted classes to remain open as it had contractual and legislative requirements to adhere to. The AEU submitted that the penalty to be imposed is 60% of the agreed penalty range.
107 The 2018 Agreement is not solely directed at BKI, but to the TAFE sector at large. It is noted that the motivation of the regulator is to send a message to other contraveners that these are serious breaches. As detailed in the witness statement of Mr McIver, there are simultaneous references to flexibility and productivity gains, as well as job security. Whilst flexibility was a goal of the negotiations around the 2018 Agreement, it was not the central purpose and must be considered against the principles of job security, and ascertaining conversion opportunities. BKI clearly traversed outside the guidelines.
108 In light of these considerations, in my view it is appropriate to impose the maximum penalty of the agreed range being $56,340.00.
Clause 13.1 of the 2018 Agreement
109 It is agreed that BKI contravened clause 13.1 of the 2018 Agreement, by failing to provide ongoing employment to Mr Frewen between 30 January 2023 and 5 September 2023. Similar to the contravention of clause 12.12, senior management officials were involved. As detailed in Mr McIver’s witness statement, “barriers to conversion” were raised via email correspondence from Mr Grinter dated 18 May 2023, sent to, among others, Mr Ballato and Ms Johnston. It was stated that:
“It seems, from what [Mr Grinter] am hearing, that there are some barriers to Conversions at the moment, most particularly in the Construction teaching area. Can we (AEU representatives) be informed as to what particular barriers to Conversions currently exist, and whether it is more of an issue in some teaching areas and less in other teaching areas, and why?”
110 Whilst Ms Johnston noted that BKI intends to build in an automatic trigger in the SAP Success Factor system (due to go live in the next few months), there has been a distinct lack of urgency in this proceeding. Mr Frewen’s desire to be converted to ongoing employment, was raised by the AEU to BKI in May 2023 and June 2023, and he was not converted until 11 September 2023. BKI admit that this process was largely delayed due to organisational changes particularly within the human resources team. Citing significant HR turnover and uncertainty during the COVID-19 pandemic, BKI contended that the situation was “shemozzle” and cannot be characterised as a deliberate design to subvert clauses. However, this does not discount the seriousness of the contravention, and as admitted by BKI, is no excuse for contravention.
111 The AEU had been agitating this issue since June 2023 – and the failure in addressing issues of ongoing conversion does amount to involuntary compliance. For these reasons, I will order the maximum of the penalty range being $57,750.00.
Clause 13.2 of the 2018 Agreement
112 The purpose of the review function is to match suitable ongoing employment to staff who are employed on a fixed-term or casual basis. The AEU says there was a misuse of fixed term and casual employment – and such circumstances were allowed to fester as a result of failing to conduct the 2023 Review as required under clause 13.2.
113 The evidence indicated that when BKI did subsequently undertake the review of the 156 impacted teachers, 33 indicated they wished to convert to ongoing employment. In turn, this contravention affected a large number of staff (rather than just Messrs Frewen and Naga) and needlessly extended the insecure employment of those employees.
114 The AEU submits that BKI treated compliance with clause 13.2 as optional. In particular no steps were taken in response to the failure to conduct the review in 2019. Ms Johnson was not even made aware of it when she took on a senior management role – and was only made aware during the publishing of the Court Book for this current proceeding. The AEU further submits that such non-compliance cannot happen by accident and that entities like BKI must have systems to ensure compliance. In this circumstance, there was no system to prevent the multitude of contraventions that have occurred in the present proceeding and continued to occur in the face of the AEU requesting answers.
115 Further, Ms Johnston knew that the 2023 Review had not been done by May 2023. BKI knew it had an obligation under the 2018 Agreement to conduct the review in April 2023. Ms Johnston also knew, and it was not done until August 2023.
116 A consequence of not conducting the reviews on time, is that staff who were eligible for conversion, and wished to convert to ongoing employment, were stuck in insecure employment. The purpose of the review is to identify these individuals, and by failing to conduct reviews within the relevant timeframes simply further ingrains insecure employment modes into the fabric of BKI.
117 As stated by Ms Johnston in her witness statement:
“From my perspective, there is no excuse for why the 2023 Review was not completed in April 2023 as required by clause 13.2 of the Agreement. It should have been a higher priority for the staff members within the People functions at BKI than any other work that had to be done at the time. Unfortunately, this was not recognised at the time.”
118 Whilst Ms Johnson acknowledges the deficiencies in BKI’s response and shows contrition for that throughout her witness statement, it does not discount from the fact that BKI was told about issues around conversion, knew reviews had not been conducted in a timely fashion, and continued to delay beginning the process. As a whole, the evidence presented indicates that there were disadvantages in BKI converting employees to ongoing employment, and distinct benefits to allowing the use of casual labour. To use the language of BKI, casual labour allowed for “flexibility” whilst navigating staffing challenges – and meant that if teaching roles were not available, BKI would not have to “carry” casual staff resources like they have to do with ongoing employees. It was advantageous for BKI to continue to keep employees as casual (despite being eligible for conversion), and such advantage outweighed BKI’s obligations to the 2018 Agreement for a period of time. But for the agitation of the AEU, BKI would have continued to use casual labour excessively. Conversion is important and a high priority and should have been completed in April 2023, in compliance with the 2018 Agreement. BKI was not in a position to monitor itself and provide the necessary checks and balance in order to adhere to the 2018 Agreement.
119 Ms Johnson now has a personal reminder and calendar invite set, to ensure the review is completed within the given timeframe. Additionally, Mr Nash was engaged in March 2024, and a large focus of Mr Nash’s role is to ensure BKI complies with its obligations under the relevant industrial instruments going forward.
120 It cannot be said the behaviour of BKI in failing to conduct the April 2023 review is an overt example of an “adherence to a strategy of choosing to pay the penalty”[20] – however, in weighing all the factors discussed in the analysis of this contravention, it may be said that such inaction is more than simply inadvertent and accidental. It served a purpose for BKI to not comply with clause 13.2, as casual staff were more of a resource, than carrying ongoing staff in a precarious environment. It was more financially viable for BKI to rely on casual staff, hence, having no incentive to conduct review within an adequate timeframe. For these reasons, it is appropriate to order the maximum amount of the penalty range, being $57,750.00.
[20]Pattinson at [50].
Co-operation and contrition
121 The parties agreed upon a co-operation discount prior to the penalty hearing. The AEU accepted that by BKI admitting liability, it saved them a contested trial and such action is to be commended. As a result, a 20% co-operation discount is reflective of the co-operative measures undertaken by BKI. A further 15% totality discount has also been agreed upon between parties.
122 The admissions of BKI demonstrate a willingness to take responsibility for the contraventions, but it is noted that no individual has taken responsibility for the contraventions. The Court has been presented a multitude of excuses, but not one individual was prepared to step up and take the responsibility for what happened. Due to such circumstances, there remains a need for specific deterrence because of the mindset of the contravener.
Prior Contraventions
123 It is common ground between the parties that BKI had not been held to contravene the FW Act previously and this was taken into account in the proposed range of penalties as agreed.[21]
[21] See Annexure A.
Conclusion
124 Accordingly, for the foregoing reasons, I am satisfied that the facts underpinning the admitted contraventions have been made out, and that BKI contravened the relevant civil remedy provisions of the FW Act. Reflecting what I have found above, BKI are ordered to pay the penalties of:
(a) $41,250.00 in respect of the contravention of clause 12.2 of the 2018 Agreement;
(b) $6,660.00 in respect of the contravention of clause 14.1(g) of the 2018 Agreement;
(c) $65,730.00 in respect of the contravention of clause 12.8 of the 2018 Agreement;
(d) $56,340.00 in respect of the contravention of clause 12.12 of the 2018 Agreement;
(e) $57,750.00 in respect of the contravention of clause 13.1 of the 2018 Agreement;
(f) $57,750.00 in respect of the contravention of clause 13.2 of the 2018 Agreement; and
(g) A total quantum of (minus the 20% co-operation discount, and 10% totality discount) $194,126.40.
125 Further, the parties were in broad agreement at to their respective submitted form of declaration sought. BKI noted that the primary difference was that the AEU proposed for the penalty figure to be declared in a single figure, rather than imposing a penalty for each contravention as per the FW Act. BKI submitted it would be in legal error, to declare a single figure. Further, BKI also consented for payment to be made to the AEU, pursuant to s 546(3) of the FW Act. There was not much difference in the between the parties as to the time in which payment ought to be made.
126 For the foregoing reasons, I will order declarations in substantially the same form as submitted by BKI, and the pecuniary penalties be paid to the AEU within 21 days from the date of order.
- - -
Certificate
I certify that these 32 pages are a true copy of the judgment of Her Honour Judge Burchell delivered on 15 April 2025.
Dated: 15 April 2025
Alexandria Peck
Associate to Her Honour Judge Burchell
Annexure A
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