Bittner Holdings Pty Ltd v Fair Work Ombudsman
[2021] FCCA 1455
•8 JULY 2021
FEDERAL CIRCUIT COURT OF AUSTRALIA
Bittner Holdings Pty Ltd v Fair Work Ombudsman [2021] FCCA 1455
File number(s): ADG 11 of 2020 Judgment of: JUDGE BROWN Date of judgment: 8 JULY 2021 Catchwords: INDUSTRIAL LAW – compliance notices – application to review – whether fair work inspector compiled with statutory criteria applicable to issue of notice – reasonable belief – whether applicant has contravened applicable modern award – matters to be considered Legislation: Evidence Act1995 (Cth) s 140
Fair Work Act 2009 (Cth) ss 539, 682, 700, 703, 706, 716, 717
Liquor Licencing Act 1997 (SA) ss 100, 107, 107A, 110, 110A.
Restaurant Industry Award 2020 cl 2, 15.1, 18.1, Sch A, cl A.2.2 and A.2.3Cases cited: Downes v FB’S 2 Pty Ltd t/as Fancy Burgers [2015] SAIRC 25
Fair Work Ombudsman v Matcraft Pty Ltd & Ors [2021] FCCA 272
Fox v Percy (2003) 214 CLR 118
George v Rockett & Anor (1990) 170 CLR 104
Hana Express Group Pty Ltd v Fair Work Ombudsman (2020) 350 FLR 359
Minister for Immigration & Citizenship v Li (2013) 249 CLR 332
Re 4 yearly review of modern award [2018] FWCFB 7263
Swissport Australia Pty Ltd v Australian Municipal Administrative Clerical & Services Union (No 3) [2019] FCA 37Number of paragraphs: 184 Dates of hearing: 25 & 26 March 2021 Place: Adelaide Solicitor for the Applicant: Dentons Counsel for the Applicant: Ms Bosboom Solicitor for the Respondent: The Australian Government Solicitor Counsel for the Respondent: Ms Walker ORDERS
ADG 11 of 2020 BETWEEN: BITTNER HOLDINGS PTY LTD TRADING AS MONTAGNA CAFE
Applicant
AND: FAIR WORK OMBUDSMAN
Respondent
ORDER MADE BY:
JUDGE BROWN
DATE OF ORDER:
8 JULY 2021
THE COURT ORDERS THAT:
1.The Compliance Notice issued on 25 November 2019 by Fair Work Inspector Zeballos pursuant to the provisions of section 716(2) of the Fair Work Act 2009 (Cth) (“the Act”) is confirmed pursuant to the provision of section 717(3) of the Act.
2.There be no order as to costs.
3.The application filed on 18 February 2020 is dismissed.
REASONS FOR JUDGMENT
JUDGE BROWN:
INTRODUCTION
These proceedings arise under the provisions of sections 716 and 717 of the Fair Work Act 2009 (Cth) (“the Act”) relating to a Compliance Notice issued by a Fair Work Inspector against the applicant, in the case, Bittner Holdings Pty Ltd (“the applicant” or “Bittner Holdings”).
Amongst other objectives, the Act is directed towards guaranteeing enforceable minimum wages and standard conditions in respect of workplaces in Australia through provisions which mandate employer compliance with various applicable industrial awards.
In order to achieve this object, the Act creates the office of the Fair Work Ombudsman,[1] one of whose functions is to enforce compliance with the Act, including any workplace obligations residing on employers, as a consequence of relevant industrial awards, mandating rates of pay and conditions of employment.
[1] See Fair Work Act 2009 (Cth) s 682. Hereinafter referred to as the respondent or “the FWO”.
In turn, the FWO may appoint Fair Work Inspectors, who are authorised to utilise what are characterised as compliance powers.[2] In general terms, inspectors are directed to investigate complaints in respect of breaches of the industrial law and are authorised to enter workplaces and determine whether an employer has contravened the law, including in respect of the application of any relevant modern award or a provision of the National Employment Standards or otherwise failed to comply with the industrial safety net.
[2] Ibid s 706.
Bittner Holdings operates a licenced café – Montagna Café (“Montagna Café” or “the Café”) – in Blackwood, a suburb of Adelaide. The proprietors of the business are Raelene Bittner and her husband Noel. Their son is the head chef. Ms Bittner describes the Café as a family business. It is open from about 8.00 am until 9.00 pm, 7 days a week. It seats 89 people, both inside and out. It serves breakfast, lunch and dinner, each day, which are prepared on the premises.
Patrons can order a variety of drinks, which are listed on its wine, beer and beverages menu. The main drinks offered are coffee, tea, commercially manufactured soft drinks and milkshakes prepared on the premises. The business also has a liquor licence, which enables it to sell beer, wine and spirits, between 10:00 am and 10:00 pm. Wine is sold either by the glass or the bottle, whilst beer and cider are sold in standard bottles. The Café does not offer beer on tap. As such, it is not required to manage and replace large kegs.
In order to serve its various beverages, the Café has a bar that keeps bottles of spirits and red wine, alongside racks of glasses. Underneath the bar are refrigerators, which hold cold bottles of white wine, beer, milk and cans of soft drink. On top of the bar is a coffee machine, grinder, milk flavourings and a milk blender.
The bar operates interchangeably as the counter for the Café. It is where the cash register is located and the terminal where electronic transactions are finalised. It incorporates a refrigerated glass cabinet that displays cakes for sale.
It is adjacent to a sink and dishwasher, which are used to clean glasses and cups. Given the nature of the Café business all front of house staff are required to work from the counter and bar area to some degree, not just those involved in the dispensation of alcohol. All such staff are required to take payment and ensure the area is kept clean.
Ms Bittner has operated the business since 2012. It employs staff to take food and drink orders, serve customers food and drink, clean tables, make coffee and milkshakes and, of course, take payment. Alcoholic drinks must be taken, by staff, from the bar to the appropriate customer seated at a table.
This process involves, in the case of wine, either opening the bottle or pouring wine into a glass and, in the case of beer, opening the relevant bottle and, if requested, pouring it into a glass. In the case of spirits, it is necessary for a staff member to place a measure, in a glass, along with the requested mixer. The Café does not serve cocktails or alcoholic drinks, which require special skills to concoct.
Staff are employed pursuant to a variety of rosters, which coincide with busier meal times. The nature of the work appeals to younger people, particularly as it is not highly skilled in nature, and those skills which are necessary can be readily learnt while on the job, from more experienced staff members, particularly Ms Bittner herself.
As such, staff progress from taking orders at the table to working behind the bar, making coffee and other hot drinks, as well as dispensing alcohol, which can be taken to the table by less experienced staff.
Necessarily, the provision of alcohol imposes stringent responsibilities on the holder of a liquor licence and, in turn, on any persons nominated by the relevant licenced holder to do so. These responsibilities include ensuring the recipient of any alcoholic drink is over the age of 18, not subject to intoxication, and the correct measure of alcohol is served to every customer.
Such responsibilities are also likely to be an incident of the successful operation of a licenced business. For obvious reasons, it is important that alcoholic drinks are poured accurately to alleviate waste, and the appropriate container or glass is utilised for each drink provided.
It is a less complex and so an inherently less onerous task to convey a poured or opened alcohol beverage that has been prepared by another person, from the location at which it has been poured or prepared, to the patron sitting at a table within a licenced café or restaurant.
The applicable award, for staff at the Montagna Café, is the Restaurant Industry Award 2020 (“the Award”). It provides for the payment of junior employees. For the sake of these proceedings, a junior employee is one who is less than 20 years of age.
Relevant to the current matter, clause 15.1 of the Award provides as follows:
Junior employees will be paid in accordance with cl 20.3. Where the law permits, junior employees may be employed in the bar or other places where liquor is sold. Junior employees working as liquor service employees must be paid at the adult rate of pay in cl 20.1 for the classification of the work being performed.
The expression liquor services employee is not defined within the Award or utilised again. South Australian regulation, made pursuant to the Liquor Licencing Act 1997 (SA) prohibits individuals under the age of 18 being involved in the dispensation of alcohol, in any way.[3]
[3] See Liquor Licencing Act 1997 (SA) ss 100, 107, 107A, 110, 110A.
In addition, the South Australian Liquor Commissioner mandates that licensees must ensure that all staff members involved in the dispensation of alcohol have undertaken a recognised course in the responsible service of alcohol and must hold a certificate in this regard.
The term ‘liquor service employee’ is not defined in the Award. However, the relevant classification of employees within the Award includes the category of ‘food and beverage attendant’.[4] There are three levels or grades within this classification.[5]
[4] Restaurant Industry Award 2020 cl 2, 18.1.
[5] Ibid cl 18.1.
In respect of both grades two and three, the prescribed duties include ‘supplying, dispensing or mixing liquor’ as well as for grade two ‘undertaking general waiting duties for food or beverages, including cleaning tables’ and in respect of grade three, ‘undertaking general waiting duties for both food and liquor, including cleaning tables’.[6]
[6] Ibid Sch A cl A.2.2-A.2.3.
On 8 April 2014, Amy Martin began work at Montagna Café. Ms Martin was born on 16 August 1997. Accordingly, she was approximately 16 years and 9 months old at the time. She was employed after being interviewed by Ms Bittner and was designated as a ‘food and beverage attendant level two’. This designation also appeared on her payslips.
Ms Martin obtained a Responsible Service of Alcohol Certificate on 18 August 2015, some two days after her 18th birthday. She left the employment of Bittner Holdings on 14 June 2019. When she turned 18 years of age, it is common ground, between the parties concerned, that Ms Martin had some involvement with the provision of alcohol at the Café, which at a minimum, included taking drinks from the bar to seated patrons.
The central evidentiary issue arising in the case is whether, at relevant times, Ms Martin was discharging the duties of a liquor services employee and should have been paid at the adult rate, from the date of her 18th birthday onwards, according to clause 15.1 of the Award. Ms Martin states that she was, however, the applicant disputes this assertion.
On 25 November 2019, Claudia Zeballos, an authorised Fair Work Inspector, issued a Compliance Notice to Bittner Holdings Pty Ltd in respect of the company’s employment of Ms Martin.
The Notice was issued pursuant to the provisions of section 716(2) of the Act and required Bittner Holdings to rectify its underpayment of Ms Martin, on the basis that she had not been paid at the required adult rate, whilst working at the Café.
Bittner Holdings commenced proceedings, in this Court, on 9 January 2020 seeking to review the Compliance Notice issued to it on the basis that it was not in contravention of the Award, so far as its employment of Ms Martin was concerned. On this basis, it seeks that the applicable Compliance Notice should be cancelled.
In its Amended Application, filed 18 February 2021, Bittner Holdings asserts that it has not committed the alleged contraventions of the Award by failing to pay Ms Martin at the adult rate because she was not, at relevant times, working as a liquor services employee. In the alternative, if Ms Martin was so employed, it is submitted that it was not a legally reasonable exercise of the FWO’s discretion to issue such a Notice.
In her supporting affidavit, Ms Bittner outlined that she has been led to believe, by the industry association of which she is a member and the FWO itself, that it was only necessary for an employee, to be categorised as a liquor service employee, if such an employee was involved in the mixing or serving of alcohol, as a principal or significant part of their duties. From her perspective, this was not the case, so far as Ms Martin was concerned.
In this context, it is the effect of Ms Bittner’s evidence that the service of alcohol, by Ms Martin, was an incidental and minor part of her duties. She asserts that Ms Martin’s duties largely consisted of wiping down tables; taking orders from customers; taking food and beverages to tables; taking payment and operating the cash register and EFTPOS machine; and washing up cups, saucers, glasses and plates, and otherwise maintaining a clean workspace, within the Café, including behind the bar.
Accordingly, it is Ms Bittner’s evidence that any involvement of Ms Martin, in the service of alcohol at the Café, particularly anything involving the obligations arising under its liquor license, was subject to the supervision of either herself or some other senior member of staff. Ms Bittner has indicated that Ms Martin only occasionally poured alcoholic drinks, and more often she took poured drinks and open bottles, prepared by others, as a waiter, to customers seated at their tables. In the jargon of hospitality, her job entailed running drinks out. [7]
[7] See Affidavit of Amy Martin’s filed 6 August 2020 at [20].
In addition, Ms Bittner asserts that the sale of alcohol was only a small part of the Café’s business, which mostly comprised the provision of hot drinks, milkshakes, cakes and the like, as well as café style meals. In these circumstances, on behalf of the applicant, of which she is a director, she seeks the cancellation of the relevant Compliance Notice.
In its response, filed 20 March 2020, the FWO asserts that Ms Martin was a liquor services employee, for the purposes of clause 15.1 of the Award and was entitled to be paid adult rates from the date of her 18th birthday until she turned 20 years of age. As a consequence, the FWO seeks confirmation of the relevant Compliance Notice.
Given its statutory obligations and public responsibilities, the FWO is to be regarded as a model litigant. It concedes there is a lack of clarity in respect of the provisions of the applicable award, which has the potential to affect many small businesses operating in South Australia.
Although, the failure of an employer to comply with a notice issued under section 716 of the Act is a civil remedy provision potentially attracting a fine of up to 60 penalty units,[8] it has been agreed that the present litigation can be approached as a test case regarding the possible parameters of the relevant award.
[8] Fair Work Act 2009 (Cth) s 539.
Accordingly, this is not a penalty hearing and it has been agreed that no issue of costs will arise. In addition, the applicant concerned has been assisted in the presentation of her case by Justice Net, a provider of pro bono legal advice. I express my thanks to the service and those who have provided assistance to the applicant in these proceedings.
THE RELEVANT LEGISLATIVE PROVISIONS
Section 716 of the Act provides that, if an inspector believes, on reasonable grounds, that a person has contravened a term of a modern award, the inspector concerned may issue that person with a ‘Compliance Notice’ requiring the person nominated to take action to remedy the contravention in question.
In this particular case, the relevant Compliance Notice, requires the applicant to make good the alleged underpayment to Ms Martin, within 28 days of the date of the Compliance Notice and provide evidence that it had done so.
Section 717 of the Act provides the recipient of a Compliance Notice, issued pursuant to section 716(2), with the right to review such a notice in this Court. The section provides as follows:
Review of compliance notices
(1)A person who has been given a notice under section 716 may apply to the Federal Court, the Federal Circuit Court or an eligible State or Territory Court for a review of the notice on either or both of the following grounds:
(a)the person has not committed a contravention set out in the notice;
(b)the notice does not comply with subsection 716(2) or (3).
(2)At any time after the application has been made, the court may stay the operation of the notice on the terms and conditions that the court considers appropriate.
(3)The court may confirm, cancel or vary the notice after reviewing it.[9]
[9] Fair Work Act 2009 (Cth) s 717.
The functions of the FWO are multifarious and are set out in section 682(1) of the Act. They include both ensuring compliance with the provisions of the Act and its objects, but also the promotion of co-operative workplace relations. In this context, the FWO has an educative role in relation to providing advice, to both employees and employers, in respect of the application of the Act to their workplaces.
In this context, the application of Compliance Notices issued under section 716 must be considered. In Fair Work Ombudsman v Matcraft Pty Ltd & Ors,[10] Judge Kendall explained the legislative intention of Compliance Notices, as an alternative to litigation, in the following terms:
As explained in the Explanatory Memorandum to the Fair Work Bill 2008 (Cth), the purpose of s 716 of the Act is to provide an alternative to litigation. Section 716 is an informal mechanism whereby the applicant can identify potential contraventions of the Act and seek rectification without an employer having to admit liability.
One of the objects of the Act is to provide accessible and effective procedures to resolve grievances and disputes and provide effective compliance mechanisms. Section 716 encapsulates this objective by allowing employees to make a request for assistance which the applicant can then resolve through the use of s 716.[11]
[10] [2021] FCCA 272.
[11] Ibid at [34]-[35] (Kendall J).
Section 716(1) and (2) of the Act delineates the criteria, which must be satisfied before an inspector may issue a Compliance Notice. Firstly, the power itself is a discretionary one and like all administrative decisions must be exercised reasonably.
Whether a discretion, conferred by statute, is exercised in a legally reasonably manner, it must be determined by reference to the statute itself, particularly its ‘subject-matter, scope and purpose’.[12] In this particular case, one of the purposes of the FWO is to provide an industrial safety net, for workers, so far as the application of industrial awards is concerned, as well as to educate employers in regard to their industrial responsibilities.
[12] See Minister for Immigration & Citizenship v Li (2013) 249 CLR 332, 370-1 [90] (Gageler J).
Secondly, the discretion may be exercised only once a reasonable belief is formed by the relevant inspector. The discretion must be exercised appropriately and not in an arbitrary, illogical or capricious manner. The exercise of the relevant discretion cannot be disproportionate to the issue raised. To be exercised reasonably, it must be possible to glean from the relevant decision record ‘an evident and intelligible justification’ for the pertinent decision.[13]
[13] Ibid at [75]-[76] (Hayne, Kiefel & Bell JJ).
In the current matter, the relevant discretion was exercised by Fair Work Inspector Zeballos. The applicant is critical that she did not make her decision to issue the Compliance Notice in a legally reasonable manner. It is submitted that the pertinent decision was disproportionate to the issues raised in the complaint, which Ms Zeballos was called upon to investigate.
Section 717(1) of the Act confers a discretionary right, on a person affected by a Compliance Notice, to seek a review of the Notice itself, in this Court. The review is open on the satisfaction of two grounds:
•The applicant has not committed any of the contraventions set out in the Notice;
•The Notice itself does not comply with the statutory machinery applicable, as contained in subs 716(2) or (3).[14]
[14] Fair Work Act 2009 (Cth) s 717(1).
These latter machinery provisions require the inspector concerned to give the person affected by the relevant Compliance Notice sufficient time to remedy any alleged breach of a workplace obligation and produce evidence of compliance.
Further, the Notice must provide particulars of the contraventions, and outline any rights of review that arise under the Act. As I understand the applicant’s case, there is no assertion that the Compliance Notice in question does not comply with the provisions contained in sections 716(2) and (3). Rather, Ms Bittner asserts that the company did not commit any of the contraventions set out in the relevant Notice.
The issue of whether the applicant has committed any of the contraventions set out in the relevant Compliance Notice is an evidentiary one. As a consequence, a question arises as to which party bears the onus of establishing whether or not any relevant contravention has been established on the balance of probabilities.[15]
[15] Evidence Act 1995 (Cth) s 140.
In Hana Express Group Pty Ltd v Fair Work Ombudsman,[16] Judge Driver found that a plain reading of section 717 of the Act established that an applicant seeking to review a Compliance Notice bears the onus of establishing that an alleged contravention of a modern award or similar workplace determination had not been committed.[17] This seems to me to be the only logical and reasonable interpretation available in respect of section 717 of the Act.
[16] (2020) 350 FLR 359.
[17] Ibid at [54] (Driver J).
Accordingly, in the present case, Bittner Holdings bears the onus of proving that it did not commit the alleged contraventions. If it discharges this onus, pursuant to the provisions of section 717(3) of the Act, the Court may cancel or vary the Notice in question, upon completion of the relevant review.
THE EVIDENCE
The applicant relies on the evidence of Ms Bittner alone. I assess her to be an experienced and highly competent business person, with a deep understanding of the responsibilities entailed in the management of a successful small hospitality business, such as the Montagna Café.
I have no reason to doubt the credibility of her evidence, although in its intricacies and emphases, it differs from that of Ms Martin and other employees, who worked at the Café concurrently with her. The main issue in contention being the involvement of staff members, under the age of 20 years, in serving of alcoholic drinks at the Café.
This does not strike me as being either surprising or anomalous. Rather, in my view, it reflects the fact that Ms Martin and those associated with her, approach the issues in dispute from one perspective, whilst Ms Bittner approaches them from an entirely different viewpoint.
Inevitably, these disparate perspectives must cause the parties to view and recollect the same events, which occurred a number of years ago now, through very different lenses. It would be impossible for any person to remember the minutiae of what he or she did, in a busy workplace, such as the Montagna Café, at some years removed.
In addition, the concept of what is meant by the expression liquor service employee, in the context of the present matter, is somewhat an abstruse one. The word liquor is used as a qualifier to the word service. However the degree or extent to which the service must be associated with liquor alone, or in combination with food and other drinks, is not specified.
It is clear, based on Ms Martin’s own evidence that her duties, at relevant times, were not confined to the provision of alcoholic drinks only. The Café provides many services related to the provision of meals and a variety of drinks. Ms Martin was involved in all these aspects of the Café’s business.
I make these preliminary observations because it is important that I point out that my view of the evidence does not support any finding that either Ms Bittner or anyone associated with her have consciously set out to exploit vulnerable young workers by underpaying them.
In my view, this is the type of matter in which different minds, being familiar with the relevant background, could reach different conclusions about the meaning of the relevant award and how it applies to a business such as Montagna Café, which is relatively small in scope, frequently very busy, and from time to time may require that all of its staff work quickly, under some pressure, to satisfy the demands of its customers.
I concede that it is not strictly necessary for me to make such a finding but consider it is appropriate to do so, given my finding that Ms Bittner is a credible witness, who has not attempted to mislead the Court in any way.
In addition to Ms Zeballos, the FWO called Ms Martin and three of her former colleagues at the Café, Cassandra Netz; Jordan Colette and Courtney Phillips. Each of these witnesses presented as honest individuals, who bore no particular animus for either Ms Bittner or anyone associated with the Montagna Café. However, some degree of solidarity is to be expected, in recollection, between the various employee witnesses.
In these reasons for judgment, findings of fact are made on the balance of probabilities, from my observation of the demeanour of each of the witnesses concerned.[18] I have attempted to base my conclusions on credibility and reliability after considering contemporary materials, objectively established facts, and importantly, the apparent logic of events.[19]
[18] See Evidence Act1995 (Cth) s 140.
[19] See Fox v Percy (2003) 214 CLR 118, 129 [31] (Gleeson CJ, Gummow and Kirby JJ).
(a) Ms Bittner
Ms Bittner deposed that, during the day, both food and drink orders, at the Café, were usually placed at the counter, where the coffee machine was situated. It is her evidence that hot drinks, particularly coffee, were the most popular beverage sold, by a marked degree. Table service begins with dinner, which commences at 5:00 pm.
Ms Bittner estimates that seven percent of the Café’s sales are made up of alcoholic drinks. In respect of overall beverage sales, beer constituted 2.5%; red wine 2.13%; sparkling wine 0.96%; white wine 2.48%; and spirits 0.33%. Hot drinks and soft drinks made up the remainder, constituting over 90% of the total sales.
As a consequence of the Café being issued a liquor licence, Ms Bittner, her husband and son are required to hold responsible person cards. These are issued by the Liquor and Gambling Commission and are required to ensure that a business, with a liquor licence, has an approved person to supervise and manage the liquor operations of such a business. Such an approved person is ordinarily required to be physically on the premises at any time a liquor licence is in operation.
Ms Bittner deposes that, in 2018, due to the low level of alcohol sales, at the Montagna Café, the business applied for an exemption requiring such a card holder to be present in respect of the Café. This exemption was granted provided the relevant card holders were easily contactable and there was ‘ample adult supervision of staff’.[20]
[20] See Affidavit of Raelene Sandra Bittner filed 9 January 2020 at [9].
It is the effect of Ms Bittner’s evidence that she or her husband, or one of a small number of trusted and experienced staff, over the age of 20, supervised staff members, who were under 20 years of age, in respect of their engagement with every aspect of the Café’s business. This included the dispensation of alcohol, if either she or her husband were not on the premises, which on her evidence, was a rare event.
In this context, she disputes any suggestion that Ms Martin personally ever engaged in such a supervisory role. In Ms Bittner’s estimation, she was neither old enough nor sufficiently experienced to do so. On the other hand, Ms Martin deposed that Ms Bittner was frequently away from the Café floor working in her office on the floor above and as such she performed this role, essentially by default. Ms Bittner accepts that she was away from the main Café floor, from time to time, during quieter periods. However, it is her evidence that she was still able to monitor activities, in the Café, by means of closed circuit television.
Ms Bittner accepted that she provided on the job training for staff and staff members over the age of 18, who were encouraged by her to obtain a Responsible Service of Alcohol Certificate. The training, which related to the service of alcohol, provided by Ms Bittner, consisted of how to pour wine correctly, to ensure that a patron did not receive a greater quantity of alcohol than expected; the correct glass to use for particular wines; how to carry a glass correctly – white wine to be carried by the stem so it is not warmed by the hand; and how to open a bottle safely, without cutting oneself.
The effect of Ms Bittner’s evidence is that the most important aspect of this training was to ensure accuracy in measuring alcoholic beverages to ensure customers were not overindulging, and so if subsequently breathalysed would not be found to be over the limit because of any misapprehension about the quantity of alcohol consumed. In respect of mixed drinks, Ms Bittner deposed that these were rarely served but training was provided in respect of measuring spirits was to be measured and the right amount of ice to add.
Ms Bittner accepted that staff members under the age of 20, who were front of house staff, when aged between 18 and 20, took alcohol orders from customers and also conveyed such drinks from the bar to seated customers. Ms Bittner asserted that such staff only occasionally or very rarely poured or mixed drinks but conceded that it did occur from time to time.
As previously indicated, she also conceded that she required her staff who were over the age of 18 years to hold Responsible Service of Alcohol Certificates, and she trained them to accurately measure alcoholic drinks. However, she disputed that such staff members had any significant legal interaction with customers in respect of the dispensation of alcohol.
It is her position that either she or another staff member, over 20 years of age, ensured that no liquor was sold to anybody under the age of 18 or who was inebriated. This is a matter of controversy. It being the evidence of Ms Martin and her colleagues that they did perform such functions.
It seems clear that, as a result of her awareness that staff members over 18 but under 20 were carrying and pouring alcohol at the Café, Ms Bittner sought advice from her industry association – the Restaurant and Catering Association – as to the application of the relevant award to such individuals.
In this context, Ms Bittner has provided an email, dated 12 March 2014, from the Association, which advised her that the FWO was of the view that junior employees, who were primarily engaged in waiting duties, including taking alcoholic drinks to customers, were not to be paid as liquor service employees, particularly if mixing or supplying alcohol did not form a significant part of such an employee’s duties.
Essentially, such juniors were not to be paid the adult rate, if they were engaged in general waiting duties, such as clearing food and tables. However, the email also cautioned Ms Bittner about allowing such junior employees to go behind the bar and mix/supply alcohol without her consent, as this would entail the discharge of the duties of a liquor services employee.
Ms Bittner deposed that, on three occasions, between 2012 and 2014, she contacted the FWO herself to obtain advice as to how the award pertained to her situation, as she saw it, namely that junior staff were carrying and pouring not a lot of alcohol, in the context of a business which had alcohol sales as seven percent of its turnover.
In this context, Ms Bittner asserted that she had been unable to get a definitive answer, from the FWO, and certainly nothing was provided to her in writing. It was in this context that she contacted her own industry association and acted in good faith on what she was told by it.
Following the involvement of Ms Zeballos in investigating the issues raised by Ms Martin as to her underpayment, Ms Bittner went back to the Restaurant and Catering Association in an attempt to clarify the source of the advice given to her in February 2014.
This led to her being provided with what can be described as a FWO enquiry details pro forma document, which posed questions to the FWO and, in particular, requested information about pay rates, under clause 15.1 of the Award. The relevant advice was received in early September of 2017 and was to the effect that employees would not be regarded as liquor service employees, if they were required to collect alcoholic beverages from the bar to serve customers as part of their general waiting duties.
For reasons which will become pertinent later, Ms Walker, counsel for the FWO, outlines that, if this advice was relied upon by Ms Bittner, in her decision as to what rates of pay were applicable to Ms Martin, it was received after her 20th birthday and so, as a matter of logic, could not have been germane in any decision making process, on her part, so far as the applicable rate of pay, for Ms Martin, was concerned.
The enquiry details pro forma document, referred to above, made reference to written advice prepared by Romit Tappoo, who, at relevant times, was an Assistant Director of the FWO. Alice Ashby, the solicitor retained by the FWO to pursue this matter, on its behalf, has obtained a copy of this response, which is annexed to her affidavit.[21]
[21] See Affidavit of Alice Ashby filed 20 March 2020 at Annexure AA-9.
In this advice, Mr Tappoo wrote as follows:
We consider that a liquor service employee is an employee mixing or serving alcohol in about or other places where liquor is sold as a principle or significant part of their duties. If mixing or serving alcohol is not a significant part of an employee’s duty, we will generally not consider them to be a liquor service employee. For example, it is our view that this does not refer to staff primarily engaged on table weighting duties who take alcoholic drinks to customers in the course of their general weighting duties.[22]
[22] Ibid.
Ms Bittner conceded that she had not seen a copy of this advice and her knowledge of it came indirectly through her correspondence, in September of 2019, with her industry association. However, in a letter drafted by her, to the FWO dated 10 March 2020, Ms Bittner refuted any assertion that Ms Martin should have been paid anything other than as a junior, citing the reference number to the above enquiry details pro forma document, which as Ms Walker submits apparently came into existence after the contentious pay period germane to Ms Martin.
As will become apparent, these considerations are relevant as to whether Ms Zeballos had formed the prerequisite reasonable standard of belief that the applicant had breached the provisions of the Act and so was legally entitled to issue the Compliance Notice which is the subject of these proceedings.
This is relevant in the context of Ms Bittner’s assertion that she had acted, in a bona fide manner, on the basis of her view of the advice provided to her by the FWO and Ms Zeballos’ own view of what was the sort of advice available, in this regard, which was available in the public domain.
In summary, in my view, the effect of Ms Bittner’s evidence was that staff members, aged between 18 to 20, employed at the Café, who were engaged in front of house duties:
·Took alcohol orders;
·Delivered alcohol from the bar to customers;
·Were trained to pour and carry alcohol correctly;
·On occasions, or very rarely, poured alcohol drinks, but were not expressly prohibited by her to do so;
·All such employees had a Responsible Service of Alcohol Certificate; and
·Were told the importance of not serving alcohol to under age or inebriated patrons.
The areas of controversy, arising from her evidence, centre on issues to do with supervision. It is Ms Bittner’s position that either she or a senior member of staff were always available to be consulted regarding the terms of the applicable liquor licence, and to make the ultimate decision about issues of service.
In this context, in my view, the following passage of her evidence is relevant:
And the reason you taught staff about how to pour alcohol and required them to – I will start again. The reason you taught staff how to carefully pour alcohol from when they turn 18 was because they would pour alcohol from time to time? --- And they would be doing that for some time. We’ve – most of our staff stay with us for a long time. We expect them – we know by the time they have their 20th birthday that they know exactly what they are doing. We just expect that.
Yes. Because they’ve been doing it when they’re 18 and 19 as well? --- They are being trained. They’re doing it. Yes.[23]
Necessarily, in my view, this evidence concedes that Ms Bittner acquiesced in her junior staff pouring alcoholic drinks so that they would be fully proficient in this aspect of service when they reached the age of 20.
[23] Transcript of proceedings, page 21, lines 15, 20.
In my view, in this aspect of training, it is more likely than not that junior staff were regularly pouring and opening alcoholic drinks, including wine bottles and measuring mixed drinks, during the course of their employment, at Montagna Café. It also seems likely that they were significantly engaged in other general waiting duties, pertaining to taking orders and the clearing of tables.
In her affidavit, Ms Bittner referred to this as appropriate training, within the hierarchy of hospitality. Junior staff carry out the more mundane duties, such as waiting on tables, clearing and taking food and drink orders, whilst more senior staff management work behind the bar, which includes learning how to operate the coffee machine and being a competent barista. One of the significant issues, in dispute, in this case, is the degree to which Ms Martin was behind the bar, and the implications of this so far as the application of the Award is concerned.
Given staff members who held Responsible Service of Alcohol Certificates were taking alcohol orders, it seem to me to be more probable than not that they played at least some role in ascertaining the age of the patron concerned and their entitlement to consume alcohol. This does not seem to have been a major issue given the nature of the Café’s business. However, it seems to me that it was likely to be integral to what Ms Martin was required to do in discharging her duties at the Café.
(b) Ms Martin
Ms Martin started working at the Montagna Café in April of 2014, when she was around 16 years and 8 months of age and still attended school. When she left school, at the end of 2015, it is her evidence that she began to take on more shifts at the Café and her responsibilities were increased.
In cross-examination, Ms Martin agreed that a number of duties were conducted by staff members working on the bar. These included being a barista, preparing milkshakes, serving soft drinks and pieces of cake. It was also the area of the Café from where alcoholic drinks were dispensed.
In her affidavit, Ms Martin deposes as follows:
I started to work behind the bar when I turned 18. There was a custom that on a shift the person who had worked at the Café for the longest period of time would work behind the bar. When I turned 18 in August 2015, I had worked at the Café for about 1.5years. During night shifts I was almost always behind the bar for a portion of the shift from 2016 onwards.
On 18 August 2015 I obtained my Responsible Service of Alcohol certificate (RSA).
I also poured and served alcohol to customers, on occasion, prior to turning 18. When this happened, Rae Bittner would say words to the effect of ‘it’s your birthday, start running’. It was my understanding that ‘start running’ meant you would take the alcoholic drinks to customers at their table. …
Most drinks were sold at night as most tables would buy at least one glass of wine or beer. As soon as a customer was seated, we would give them a wine list. There were stand up advertisements for wine and beer on the tables which we would point to when speaking to customers. Rae Bittner told me and other wait staff to encourage every table to buy alcohol. She would tell me and other wait staff off if any customer came to the counter to order a drink.
Processing a drinks order would involve a member of the staff taking a customer’s order at their table, processing it through the till, and the person behind the bar making the drink. The person behind the bar would then put the drink on the cake fridge, and the staff on the floor would take it to the customer’s table.
Preparing a beer order involved opening a beer bottle with a bottle opener and placing it next to a glass on the cake fridge. All beers were kept in the beer fridge and were served with a glass. Cider was served with ice. I had to tell other staff to open the beer bottles with a bottle opener as I had previously cut myself.
Preparing a mixed drink involved mixing straight spirits with tonic water, soda or lemonade. I would use shot glasses to measure the quantity of alcohol. We would pour this into either a short or tall glass. We would serve women’s drinks with a straw and men’s drinks without a straw.
I would show new staff members how to pour wine by pouring water to the marker on a wine glass as an example. We would keep this glass of water at the bar for the younger or less experienced staff when they were working on a night shift.[24]
[24] See Affidavit of Amy Elizabeth Martin filed 6 August 2020, at [18]-[25].
In my view, none of these aspects of Ms Martin’s evidence were undermined by her cross-examination. On balance, it seems to me that it is more probable than not that, particularly at times when the Café was busy, which occurred when it had special meal offers, on weekends and Fridays, responsibility for being behind the bar, which entailed a number of duties, including the dispensation of alcohol, devolved onto Ms Martin, who felt sufficiently authorised, by the applicant, to discharge a variety of duties. These included opening and pouring alcoholic drinks and by necessary implication determining whether those orders should be fulfilled.
(c) Ms Netz
Ms Netz worked at the Montagna Café for about a year from June 2016 onwards. She is approximately three months older than Ms Martin. When she began work at the Café, she already had a Responsible Service of Alcohol Certificate, which she had obtained at a previous hospitality job.
It is the effect of Ms Netz’s evidence that the ordering of alcoholic drinks was a reasonably frequent occurrence, at the Café, particularly at dinner.
In her affidavit, Ms Netz deposes that she was trained to pour wine, prepare beer and mix spirits by both Ms Bittner and Ms Martin, who as a consequence of her length of service at the Café, was regarded as a senior staff member, although she was not, at the time, over 20 years of age. This evidence rings true to me.
In her affidavit, Ms Netz explained the process that occurred when a patron made an order for an alcoholic beverage.[25] Once such an order was made, the waiter concerned would enter it into a touch screen computer, which printed a docket indicating the type of drink ordered. The docket resulted in a staff member behind the bar preparing the drink concerned and on its completion placing it on the bench next to the coffee machine, where another staff member would take it to the applicable table.
[25] See Affidavit of Cassandra Netz filed 6 August 2020 at [13]-[17].
Usually, the alcoholic drink concerned was prepared by a person operating behind the bar, who was over 18 years of age and viewed as being experienced. Wine would be poured into a glass up to the designated line, while beer would be prepared by removing the lid off the bottle concerned and placing it next to the appropriate beer glass.
Mixed drinks would be prepared by a senior person behind the bar through placing ice in a glass, then measuring the designated spirit with a triangular shaped measure, which would be poured into the relevant glass. The requested diluting soft drink would be provided in a can, placed next to the glass.
Ms Netz estimates that she worked at the Café between three to seven occasions each week, involving a variety of shifts. It is her recollection that she frequently worked with Ms Martin.
I accept Ms Netz’s evidence that she was trained, by Ms Martin, in the preparation of alcoholic beverages. I also accept her evidence that she herself frequently saw Ms Martin prepare wine and beer, when she worked behind the bar. Ms Martin also regularly delivered drinks from the bar to customers.
Ms Netz’s recollection is that around 60% of tables ordered an alcoholic drink at lunch time, with the percentage reaching 80% at dinner. The most popular drinks were wine, particularly red wine and beer. Mixed drink orders were rare.
Given the figures provided by Ms Bittner regarding alcohol sales, Ms Netz’s recollection about the volume of alcohol sales may be inflated. However, I accept that the provision of alcoholic drugs was part and parcel of the provision of the Café’s services. As such, it seems more probable than not, particularly when the Café was busy, which all the witnesses agree that it was from time to time, that the role of dispensing alcoholic drinks devolved onto the shoulders of waiting staff in whom Ms Bittner had confidence. Undoubtedly, this included Ms Martin.
(d) Mr Colette
Mr Colette was born on 26 April 1998 and began working at the Montagna Café, in December 2013, when he was around 15 years and 8 months of age. He ceased his employment at the Café in January 2018, prior to his 20th birthday. Accordingly, he worked with Ms Martin for around three years. It was the effect of his evidence, which I accept, that he accepted Ms Martin as one of the more senior staff members at the Café.
In cross examination, Mr Colette accepted that Ms Bittner was present, at the Café for the majority of the times he worked there. However, he rejected the proposition that there was always someone who was over the age of 20, working behind the bar when alcohol was being served. In addition, he did not accept the proposition that alcoholic drinks were a fairly small proportion of drinks sold. He conceded, that the dinner sitting, particularly on weekends, was when most alcoholic drinks were sold and some particular nights, particularly involving special offers, such as two-for-one pizza specials were busier than normal.
(e) Ms Phillips
Ms Phillips was born on 29 December 1997 and commenced working at the Montagna Café, in early 2015, when she was 17 years of age. She left the Café’s employ in early January of 2017.
Ms Phillips accepted that Ms Bittner worked long hours at the Café and was present there most days. She also conceded that there was another senior staff member, who was over 20, present at the Café most of the time but not always.
Ms Phillips also deposed that Ms Martin worked behind the counter/bar and prepared a variety of drinks, including milkshakes, soft drinks and coffee. She emphatically rejected the proposition that Ms Martin only occasionally poured alcoholic drinks, when she was behind the bar area. Ms Phillip’s evidence was that, when she reached the age of 18, she began to pour wine, prepare beers and she saw Ms Martin do the same.
Overall, the effect of the evidence of Ms Martin, Ms Netz, Mr Colette and Ms Phillips, in combination, is that Ms Martin was engaged in the dispensation of alcoholic drinks, from the bar area of the Café, where she received the alcoholic drinks orders of other staff members. This was because she was regarded as a more senior member of staff and had a quasi-training role derived from her significant level of experience in the business.
The effect of this evidence was that Ms Bittner had a more onerous supervisory role and was the ultimate decision-maker in the Café. However, the day to day exigencies of the business, particularly when it was busy, necessarily resulted in employees, such as Ms Phillips, being heavily involved in the disposition of alcoholic drinks, which represented an integral part of the Café’s business, particularly at lunch and dinner services.
(f) Ms Zeballos
Ms Zeballos has been a Fair Work Inspector since March of 2016. She presented as a balanced, experienced and professional witness. I found her evidence to be credible.
Ms Zeballos deposed, in her oral evidence, that she became involved with the Montagna Café as a result of being directed to attend to an enquiry, made by Ms Martin, through the Fair Work Info Line regarding pay rates for junior employees in the hospitality industry. As a consequence, she administered a questionnaire to Ms Martin. Subsequently, Ms Zeballos administered the same questionnaire to Ms Phillips, Ms Netz and Mr Colette. Ms Martin provided her answers on 6 August 2019, whilst the others provided theirs on 6 November 2019.[26]
[26] See Exhibits ‘A’-‘D’.
In her questionnaire, Ms Martin indicated that she commenced serving alcohol, at the Café, when she attained the age of 18 and trained other staff members. She indicated that she had decided to query her rates of pay, at the Café, because she had changed her employment, within the hospitality industry, and had been paid at a higher level, to that which she had enjoyed at the Montagna Café.
Ms Zeballos asked Ms Phillips, Ms Netz and Mr Colette specific questions about their involvement with the provision of alcohol at the Montagna Café. Each acknowledged that they poured wine, served beers and mixed drinks, when they had attained the age of 18. Ms Netz indicated that this occurred, when she had been allowed to work behind the bar.
Mr Colette indicated that he was predominantly involved with the service of beers and wine but also mixed scotch and coke and vodka and lemonade. He also indicated that Ms Bittner was insistent that employees involved in this way obtained a Responsible Service of Alcohol Certificate before they started running alcohol.
Following her interview with Ms Martin, Ms Zeballos spoke to Ms Bittner, who informed her that she (Ms Bittner) had previously received advice from the FWO regarding the classification of employees as liquor service employees, particularly in the context of the correct rate of payment.
In particular, Ms Bittner indicated her view that employees who were ‘pouring alcohol or who were mixing alcohol, but very little, as part of their duties … and were being managed by someone as just juniors [were] not liquor service employees’.[27]Ms Bittner indicated that she had received this advice in writing but would have to search for it. Ms Zeballos requested the advice but it was never produced to her.
[27] See Affidavit of Raelene Sandra Bittner’s filed 9 January 2020.
Between August and September of 2019, correspondence passed between Ms Zeballos and Ms Bittner and subsequently Ms Bittner’s solicitor, regarding their respective views on the nature of Ms Martin’s employment at Montagna Café. In this context, Ms Zeballos also sought wage records pertaining to Ms Martin from Ms Bittner.
In particular, on 18 September 2019, Ms Zeballos wrote to Ms Bittner and informed her that she had formed the view that Ms Martin had been required to serve alcoholic beverages, at the Café, once she turned 18 years of age in August 2015. As a consequence, it was Ms Zeballos’ view that Ms Martin should have been classified as a liquor service employee and paid accordingly.[28]
[28] See Exhibit ‘L’.
In her response, via her solicitors, issued on 31 October 2019, Ms Bittner relied upon the advice, which had been provided to her, via the Restaurant and Catering Association, that junior employees, primarily engaged in waiting duties, which included taking alcoholic drinks to customers but not mixing or supplying alcohol, were not to be required as liquor service employees. Accordingly, it was asserted that Ms Bittner had acted, at all times, in good faith and reasonably sought advice to ensure she met her obligations as an employer.[29]
[29] See Annexure ‘J’.
In her affidavit evidence, Ms Zeballos deposed that the FWO maintained an electronic and paper record in respect of enquiries made to it in areas relating to its statutory obligations. Ms Zeballos deposed, in cross–examination, that she had searched these records and had not found any advice provided by the FWO to Bittner Holdings, prior to the issue of the Compliance Notice.
As previously indicated, in correspondence from her to the solicitors for the FWO, in response to a letter dated 13 February 2020, Ms Bittner alluded to a particular FWO enquiry, which referenced the advice of Mr Tappoo. As previously indicated, this advice post-dated Ms Martin’s 20th birthday and so cannot logically have been available to Ms Bittner, when she made her decision as to the rates of pay of Ms Martin.[30]
[30] See Annexure ‘AA-3’ to the Affidavit of Alice Ashby filed 20 March 2020.
Having responded to Ms Martin’s complaint about her employment at Montagna Café and having made various enquiries into it, including interviewing both the relevant manager and other employees, prior to her being able to issue a Compliance Notice against Bittner Holdings, Ms Zeballos was statutorily obliged to consider whether it was reasonable for her to do so. This required her to consider the nature of the evidence gathered by her, and then determine what beliefs she could objectively form, from that evidence.
Accordingly, in general terms, it is not an intuitive task or one which requires a subjective opinion. Rather, it must be objectively based. To this end, systems devised within the office of the FWO have devised a schematic fact evaluation tool, which Fair Work Inspectors are required to follow to assist them in determining whether the evidence available to them is sufficient to enable them to have reached the prerequisite standard of objective belief required to issue a Compliance Notice within the context of the Industrial Regulatory Scheme. In the applicable jargon, this tool is referred to as the reasonable belief matrix.[31]
[31] See Exhibit ‘G’.
As part of the process of completing the matrix, Ms Zeballos summarised her interviews with Ms Martin, Ms Netz, Ms Phillips and Mr Colette; made reference to the fact that Ms Bittner had confirmed, during conversation with her, that Ms Martin had served alcohol since she turned 18 years of age; and had examined relevant pay records, provided by Bittner Holdings, in respect of Ms Martin’s rate of pay, which confirmed that she had not been paid at the full adult rate.[32]
[32] See Exhibit ‘H’ Employer/Manager Questionnaire.
In addition, the reasonable belief matrix envisaged Ms Zeballos as being able to access information, from the FWO’s database regarding advice provided generally to the community, as well as to individual employers, regarding the meaning of the expression liquor service employee. Ms Zeballos referred to these as knowledge articles. These include an internet search site, created by the Fair Work Commission, directed towards answering employer and employee queries regarding the application of awards, entitled The Pact.[33]
[33] See Exhibit ‘E’.
This site indicates that ‘juniors who sell or serve alcohol, including as part of their general waiting duties, have to be paid the adult rate for their classification regardless of their age’.[34]This same statement also appears on the Fair Work Commission website where information is provided about age restrictions when serving alcohol under the heading ‘Special Rates for Working around Alcohol’.[35]
[34] See Exhibit ‘F’
[35] Ibid.
Ms Zeballos correlated this information with the payslips she had examined in respect of Ms Martin, and when completing the reasonable belief matrix, she formed the belief that Ms Martin had been a liquor services employee, when she had attained the age of 18 years, but had been paid at a junior rate rather than an adult rate. As a consequence, Ms Zeballos made the decision to issue the relevant Compliance Notice to Bittner Holdings.
DISCUSSION
These proceedings relate to a judicial review of a Compliance Notice issued by Ms Zeballos against Bittner Holdings on 25 November 2019. The review can be successful only if one or both of the limbs stipulated in section 717(1) of the Act have been satisfied, namely the relevant person has not committed the contravention specified in the Notice, or the Notice itself is not compliant with the provisions of the Act set out in sections 716(2) or (3).
There is no controversy that Ms Zeballos was, at relevant times, a person appointed by the FWO to be a Fair Work Inspector pursuant to the provisions of section 700(1)(a) of the the Act. In general terms, such inspectors are conferred with functions and powers to ensure that employers meet their obligations, to their employees, arising under the Act, particularly in regard to ensuring that such employees are remunerated in accordance with any applicable award. These are referred to as compliance powers.[36]
[36] Fair Work Act 2009 (Cth) s 703.
However, inspectors are only authorised to exercise these compliance powers if they reasonably believe an employer has contravened:
•a provision of the National Employment Standards; or
•a term of a modern award; or
•a term of an enterprise agreement; or
•a term of workplace determination; or
•a term of a national minimum wage order; or a term of an equal remuneration order.[37]
[37] Ibid s 716(2).
Again, there is no controversy that the Award is a modern award, and therefore Ms Zeballos was conferred with compliance powers in respect of its terms, which applied to employees of Bittner Holdings Pty Ltd at the Montagna Café, particularly Ms Martin.
Pursuant to section 716(1), Ms Zeballos was authorised to issue the impugned Compliance Notice only if she believed, on reasonable grounds, that the respondent had breached a term of a modern award. In this case the relevant term is clause 15.1 of the Award which requires payment of junior employees at the adult rate if working as liquor service employees.
At relevant times, the evidence unequivocally indicates that Ms Martin was a junior employee, in the sense that she was over 18 years of age but not over 20. The more nuanced issue was whether she was working as a liquor service employee. It was to this issue Ms Zeballos was required to turn her mind and consider whether it was reasonably open for her to conclude that Ms Martin was such an employee.
In conducting this task, Ms Zeballos followed the protocol mandated by the FWO. She interviewed Ms Martin herself, a number of her co-employees at relevant times, and her direct employer, who was also her direct supervisor. Significantly, Ms Zeballos also had access to the relevant pay records which enabled her to ascertain at what rate Ms Martin had been paid following her reaching the age of 18.
The evidence provided to Ms Zeballos by Ms Martin herself, as corroborated by Ms Netz, Mr Collette and Ms Phillips, was that Ms Martin took alcoholic drink orders, opened alcohol, and poured alcoholic beverages, which she conveyed to customers, or directed other staff to take to customers. In addition, Ms Bittner herself conceded that Ms Martin had been trained to serve alcohol, including pouring it.
In all these circumstances, I am of the view that Ms Zeballos did form a reasonable belief that the respondent had breached a relevant term of a modern award in respect of the payment of Ms Martin and therefore she was entitled and authorised to issue the Compliance Notice under section 716 of the Act.
In addition, I am satisfied that the Compliance Notice drafted by Ms Zeballos complied with the requirements of sections 716(2) and (3) of the Act. In particular, it provided a prerequisite level of detail in respect of how the alleged contravention had arisen and provided sufficient time for the contravention to be rectified, which was 28 days.
The Notice was addressed to the respondent and was formally signed by Ms Zeballos. It complied with other formalities requiring Notice be provided of the ability to apply to the Court for a review in accordance with the Act’s civil remedies provisions.[38]
[38] Ibid s 716.
In my view, there is no substance to any criticism that Ms Zeballos’ decision to issue the Compliance Notice was tainted by any specifies of legal unreasonableness, in the sense identified by the High Court in Minister for Immigration & Citizenship v Li.[39]
[39] Minister for Immigration & Citizenship v Li (2013) 249 CLR 332, 364 [68]-[76] (Hayne, Kiefel and Bell JJ).
The reasonable belief matrix that Ms Zeballos assiduously followed, containing as it does, references to her interviews with not only Ms Martin but other employees, and Ms Bittner herself, provides an evident and intelligible justification for issuing the relevant Compliance Notice.
Equally significant, the Notice itself clearly falls within the ambit of the compliance powers conferred upon Ms Zeballos, as a Fair Work Inspector, particularly within the scope of her authority to investigate whether the terms of any relevant award have been contravened. There was evidence available to Ms Zeballos, which enabled her to reach a conclusion that Ms Martin had been engaged in the duties of a liquor service employee. As such, the decision to issue the Notice cannot be characterised as capricious or lacking in logic in some way.
Certainly, in my view, the completion of the matrix, by Ms Zeballos, in the context of the evidence which it encapsulated, demonstrates the state of belief, which she had reached in her mind, regarding the non-compliance by the respondent with the relevant award. It was reasonable in the sense that it was founded on demonstrable facts, which she personally had elicited from Ms Martin, Ms Bittner and other previous employees of the Café.[40]
[40] George v Rockett & Anor (1990) 170 CLR 104, 111-2 (Mason CJ, Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ).
The first limb of section 717(1) being satisfied, the onus now shifts to the respondent to establish that it has not committed the contravention as set out in the Notice. This requires it to establish that it was not obligated to pay Ms Martin, at an adult rate, for the work performed by her at the Montagna Café, from when she turned 18 until she left its employment.
This aspect of the case turns on the interpretation of clause 15.1 of the Award. Subject to the applicable State law provisions, junior employees may be employed in a bar or other place where liquor is sold, and when working as liquor service employees, such juniors must be paid at the adult rate.
The parties have differing views on the construction of this provision. On the one hand, Ms Bittner approaches the award on the basis that junior employees can work in and around the premises, such as the Montagna Café, where alcohol is sold but not be liquor service employees because their involvement with alcohol is not a significant part of their duties, in the sense that they may merely carry it to table or collect its empty receptacles, after consumption by patrons.
On the other hand, the FWO, in reference to how Ms Martin and her former colleagues have describes her duties, would characterise this as being an inaccurate description of what Ms Martin did at the Café, once she turned 18. The respondent would assert that Ms Martin was clearly a liquor service employee, working in a place where liquor was sold, who was integrally involved in the sale and preparation of alcohol.
The resolution of this controversy depends both on the Court’s interpretation of the Award itself and on finding of fact. In respect of evidentiary issues, for the reasons which follow, I prefer the evidence of Ms Martin, Ms Netz, Mr Collette and Ms Phillips to that of Ms Bittner. Although, in my view, there are few major discrepancies between them, and what discrepancies arise involve matters of emphasis and perspective rather than significant evidentiary controversy.
I also appreciate that in resolving the issue, the Court is involved in something of a test case, which has implications for the operators of other licenced premises, who employ junior staff, in establishments similar to the Montagna Café, throughout South Australia and perhaps Australia generally.
Rangiah J in Swissport Australia Pty Ltd v Australian Municipal Administrative Clerical & Services Union (No 3) summarised the principles applicable to the construction of awards in the following terms:
•The Acts Interpretation Act 1901 (Cth) applies to the construction of awards;
•Awards are to be constructed by applying the natural and ordinary meaning of the words used;
•An award is to be constructed in the light of its industrial context and purpose;
•An award is also to be constructed in the light of its commercial and legislative context;
•Awards should not be interpreted in a vacuum divorced from industrial realities;
•The origin of a particular clause in an award is relevant;
•Undue emphasis should not be place on infelicitous expressions utilised in drafting. Sense should derive from the basis conventions of the English language, avoiding pedantry. In this context, it is not open to the court to give effect to some notion of what is fair, derived from a source extraneous to the written award;
•However, ultimately, the Court is required to give effect to the meaning of an award as expressed in its actual words, objectively construed.[41]
[41] Swissport Australia Pty Ltd v Australian Municipal Administrative Clerical & Services Union (No 3) [2019] FCA 37 at [52] (Rangiah J).
There can be no doubt that the Montagna Café was a licenced premises, which offered alcoholic drinks on its menu. The evidence of Ms Bittner is that she required her waiting staff, who were over 18 years, to have Responsible Service of Alcohol Certificates. Ms Bittner trained them to pour alcoholic drinks, which were, in my finding, incidental to the serving of many meals, at both lunch and dinner, at the Cafe.
In my view, the actual physical act of pouring alcoholic beverages connotes a significant level of involvement with alcohol, particularly in the sense of ensuring that there is neither over nor under dispensation of a measured quantity of alcohol. The same is true of mixed drinks. It is less so in respect of pre-packaged beer.
Ms Martin, supported by Ms Netz, Mr Collette and Ms Phillips, outlined that her role, at the Café, included being behind the bar as well as front of house, and that she poured and made alcoholic drinks ready to be taken to tables and this occurred, from time to time, in the absence of supervision by a person over the age of 20 years. In addition, I accept Ms Martin’s evidence that there was an understanding that she would have such a quasi-supervisory role whilst Ms Bittner or other older staff members were absent from the Café floor.
Ms Bittner, on the one hand, and Ms Martin and the other junior staff members on the other, disagree about the extent that alcohol sales made up the turnover of the Café’s business. In this context, I consider that the gross figures relied upon by Ms Bittner have the capacity to be misleading. No doubt, on some occasions more alcohol was served than on others. Evening and weekends being more significant than other days.
However, in my finding, the service of alcohol, particularly its pouring behind the bar, was more than an incidental or occasional part of Ms Martin’s duties at the Café. In my view, her responsibilities in respect of bar duties were more than just occasional or rare ones. This was a licenced café, with a bar and it regularly served alcohol as an integral part of its meal services.
In my view, a contrary finding would not fit comfortably with the tenor of Ms Bittner’s own evidence that she took pains to ensure that her staff, including junior staff (over 18 but under 20) were trained to pour wine in the applicable glasses, to the appropriate measure, in order to ensure the Café’s patrons were able to calculate their own personal alcohol consumption.
Ms Bittner also conceded that juniors, such as Ms Martin, were responsible for assessing whether a particular patron was over 18 years of age and were legally able to consume alcohol on a licenced premises because they took alcohol orders, albeit she asserts that such decisions were subject to her oversight, if necessary.
In addition, the manner in which the Café was configured, with an obvious bar area complete with bottles, glass fronted fridges containing white wine and beer, glass racks and similar utensils, clearly indicated that the Café was a licenced premises, and the sale of alcohol was integral to its service of meals and other comestible items. This was also obvious from the contents of its menu, which had a discrete wine and beverage list.
I agree with Ms Walker’s submission that the relevant clause of the Award is sparse in terms of what a liquor service employee is and what is entailed in such a person’s duties. However, in my view, Ms Martin was doing more than taking alcohol orders at table and delivering drinks to patrons. She was mixing alcoholic drinks, albeit not as frequently as she poured wine and opened beer bottles, and this was, at times, a significant portion of her duties, particularly when the Café was busy.
It seems unlikely that Ms Bittner could have had access to the Tappoo advice from the FWO prior to Ms Martin turning 20 years of age. She did, however, have access to advice from March 2014, which indicated that juniors, who were primarily engaged in waiting duties, including taking alcoholic drinks to customers, were not to be paid as liquor service employees, particularly if mixing or supplying alcohol did not form a significant part of such an employee’s duties.
What is noteworthy about this advice was that it contained a caution in respect of allowing such junior employees to go behind the bar and mix or supply alcohol as this would have the effect of translating such an employee into a liquor services employee. In my view, the effect of Ms Martin’s evidence, when viewed in conjunction with that of her colleagues, was that she was indeed working behind the bar and was engaged in the actual mixing and supply of alcohol.
Clause 15.1 of the Award is not restricted to employees who only work behind a bar. The natural import of its words are that it applies to any place where liquor is sold. Clearly, in my view, it has application to a licenced premises, such as the Montagna Café.
The term liquor service employee is not defined in the Award. However, there are other classifications in it relating to the service of alcohol. These are ‘Food and Beverage Attendant Grades 2 and 3’, which encompass ‘supplying, dispensing or mixing liquor in the case of the former, and undertaking general waiting duties of both food and liquor’.[42]
[42] Restaurant Industry Award 2020 Sch A cl A.2.2-A.2.3.
The parties themselves, particularly Ms Bittner, make much of the extent to which a front of house person, at the Montgagne Café, was involved with the carriage of alcohol. Ms Bittner asserting it was peripheral and occasional; Ms Martin and the others asserting otherwise. However, clause 15.1 of the Award does not specify that the status of a liquor services employee is conditional on there being a particular proportion of regularity in the engagement of such tasks.
The ordinary meaning of the words involved, is that they connote a form of service involving liquor. In ordinary parlance service, as a noun, involves the doing of work for another. In my view, the service provided by Ms Martin, at relevant times, for the applicant, was taking orders for liquor; opening bottles of liquor; pouring liquor within prescribed parameters; ensuring the basic competencies, within the framework of the responsible service of alcohol certification, were met; and conveying alcohol, in appropriate vessels to tables.
In my view, on any ordinary construction of the words involved, Ms Martin was a liquor services employee given what she did and where she did it, both behind a bar and in licenced premises generally. In addition, it seems evident to me that much of the services she provided as an employee of the respondent involved alcohol to some degree or another. In particular, every lunch and dinner service, in which she was engaged, had the potential to involve her in dispensing alcohol in the manners outlined above.
Issues broadly analogous to those arising in the current matter were considered by Industrial Magistrate Lieschke in Downes v FB’S 2 Pty Ltd t/as Fancy Burgers (“Fancy Burgers”).[43]The main difference between this case and the matter at hand is the age of the worker. In Fancy Burgers, the case concerned the involvement of a 17 year old in the dispensation of alcohol in which there were issues relating to the level of supervision and who opened the bottles of alcohol concerned.
[43] Downes v FB’S 2 Pty Ltd t/as Fancy Burgers [2015] SAIRC 25.
The licenced premises in Fancy Burgers, as the name suggests, sold hamburgers which could be taken away or eaten on the premises. It sold beer, cider and wine. Emphasis was on the speed of services, with orders placed at the cash register. In general terms, it was a melange of a restaurant and fast food outlet, with a greater emphasis on the former than the latter.
Industrial Magistrate Lieschke summarised his findings in respect of what the junior employee concerned in the case was required to do as follows:
While I accept the respondent’s goal of an older colleague opening, pouring and handing the drink to the customer I also accept the applicant’s evidence of the reality of the arrangements she worked under such that as a 17-year-old she usually completed all parts of the transaction save for opening the bottle.
The respondent’s policy was to serve a customer within eight to ten minutes of an order being placed. It considered fifteen minutes to be unacceptable. If the wait was going to be fifteen minutes or longer the applicant would warn the customer. The applicant estimated the likely waiting time by the number of order dockets lined up in the kitchen. Towards the end of the applicant’s employment a system of timed coloured lights was installed as an obvious reminder of the lapsed time since each order was placed.
The applicant sold alcohol every day she worked. Beer with burgers was quite regular. Alcohol was sold more on weekends than midweek and more at night than at lunchtime. Alcohol sales made up 4.3% of the store’s gross sales. Alcohol beverages were to be consumed on the premises and could not be taken away in accordance with the respondent’s liquor license.
In the role of team leader the applicant worked as a supervisor of team members and was the senior employee on duty when the store manager was not present. She was given keys to the premises, the alarm code and keys to the safe. She was in charge of opening and closing, and was sometimes the last person to leave. She was responsible for monitoring efficient utilisation of casual hours, counting and recording takings, and banking. Towards the end of her employment she received a Responsible Person’s badge relating to the supply of alcohol.[44]
[44] Ibid at [20]-[23] (Industrial Magistrate Lieschke).
In my view, similar considerations were germane to Ms Martin. The Café was frequently busy. Orders, including alcohol orders had to be completed quickly. She took orders for alcohol frequently and was responsible for ensuring it was conveyed to patrons efficiently. This meant she was engaged in its dispensation from start to finish, hence, in my view, she was a liquor service employee.
In Fancy Burgers, Industrial Magistrate Lieschke found similarly:
In my opinion the facts of another person opening the bottle, and the existence of a policy but not a standard practice of another person pouring and handing the drink to the customer, do not negate the applicant’s central role and legal responsibility in supplying and dispensing liquor. While she was not completing all steps in the process of supplying and dispensing liquor she was nonetheless performing an essential part of the process as a 17-year-old. The fact that only a small proportion of the respondent’s gross sales were of liquor cannot negate this conclusion. Accordingly I conclude the applicant was engaged in the supplying or dispensing of liquor throughout her employment.[45]
[45] Ibid at [41] (Industrial Magistrate Lieschke).
I reach the same conclusion so far as Ms Martin’s employment is concerned. She had a central role and legal responsibility, in terms of measuring alcohol correctly and checking the age of potential consumers of alcohol, in respect of all aspects arising from supplying and dispensing liquor at the Montagna Café. Although Ms Bittner was the ultimate decision maker in regard to service and alcohol issues at the Café, she was not always on the floor or available to take part in the supply chain of alcohol.
This role and the responsibilities it entailed was assumed by Ms Martin. In my view, with the tacit imprimatur of Ms Bittner. It was also the understanding of other more junior employees working at the Café. As such, Ms Martin is to be regarded as a liquor services employee so far as the application of the Award is concerned. In my view, for the reasons which follow, this is a significant finding when the industrial, commercial and legislative context of the Award is considered.
The supply of alcohol, to members of the public, at a licenced premises, is a significant duty and responsibility. Ms Bittner was aware of this responsibility, which she confirmed in a number of ways during her evidence. Firstly, the requirement that her staff over 18 years of age hold Responsible Service of Alcohol Certificates entailed some level of responsibility to check the entitlement of patrons to consume alcohol. Secondly her stipulation that all staff dispensing alcohol, including Ms Martin, pour the right amount so that patrons could calculate accurately, for themselves, how much they had consumed in the context of whether it was both safe and legal for them to drive.
As such the employment relationship between Ms Martin and Ms Bittner was one grounded in both trust and reliance. Ms Bittner trusted Ms Martin to pour the correct amount of alcohol, for each customer and relied upon her to do it correctly without direct supervision. In addition, for obvious reasons, the correct dispensation of alcohol, at least in terms of not over-serving, makes sound, commercial sense.
In my view, these are sophisticated tasks, within the context of a licenced premises, such as the Montagna Café. They are not the tasks of junior employees, entailing as they do, trust and a significant level of responsibility.
These were issues which drew the attention of the Fair Work Commission, when it conducted its Four Yearly Review of the Modern Award in respect of the Hospitality Industry.[46] The Commission said as follows:
It also needs to be born in mind that all employees who serve alcohol in restaurants are required to have a responsible service of alcohol qualification – regardless of the age of the employee. Further, wait staff face significant penalties under State liquor laws if they serve alcoholic beverage to an intoxicated person. These responsibilities merit the payment of adult wages to those 18 and 19 year old wait staff who serve alcohol.
…
A waiter is likely to have the most direct contact and engagement with a customer in a restaurant. Consequently they are likely to be in the best position to assess whether or not a customer is intoxicated – not a barman mixing drinks some distance away.[47]
[46] Re 4 yearly review of modern award [2018] FWCFB 7263.
[47] Ibid at [163]-[164] (Ross P, Masson DP and Commissioner Lee).
In the context of the current case, I concede that the effect of Ms Martin’s evidence was that she was frequently behind the bar. However, she was also on the floor engaging with patrons. As such, it was Ms Martin who was having this significant degree of direct engagement with the service and dispensation of alcohol. Ms Bittner and other senior staff in the kitchen relied on Ms Martin performing this role, whilst she and they performed other tasks elsewhere, from time to time.
In all these circumstances, it is my view that the basis on which Bittner Holdings sought review of the Compliance Notice under section 717 of the Act is not established. As a consequence, the relevant Compliance Notice must be confirmed in accordance with the provisions of section 717(3) of the Act.
The FWO makes no submission or claim for costs. Accordingly, there will be no order as to costs. For all these reasons, the orders of the Court will be as set out at the commencement of these reasons for judgment.
I certify that the preceding one hundred and eighty-four (184) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Brown. Associate:
Dated: 8 July 2021
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