Construction, Forestry and Maritime Employees Union v AMK Imaging Pty Ltd

[2024] FedCFamC2G 361

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 2)

Construction, Forestry and Maritime Employees Union v AMK Imaging Pty Ltd [2024] FedCFamC2G 361

File number(s):

CAG 37 of 2022

Judgment of:

JUDGE W J NEVILLE

Date of judgment:

20 March 2024 (oral reasons)
24 April 2024 (provision of written reasons)

Catchwords:

INDUSTRIAL LAW – parties agreed in relation to liability of the Respondents regarding contraventions of the Fair Work Act  2009 (Cth) – considerations regarding appropriate penalty in the light of the High Court decision in ABCC v Pattinson – particular regard to “first time offender” here and “inadvertence” and “ignorance of the law” as opposed to concerted strategy of “deliberate recalcitrance” – in such cases, according to the High Court, a “modest penalty, if any” may be appropriate to achieve the principle of deterrence – modest penalties imposed.

Legislation:

Fair Work Act 2009 (Cth) ss.45, 323, 536, 550

Cases cited:

Australian Building and Construction Commissioner v Pattinson (2022) 274 CLR 450

Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith (2008) 165 FCR 560

Fair Work Ombudsman v Devine Marine Group Pty Ltd [2014] FCA 1365

Trade Practices Commission v CSR Ltd [1991] ATPR 41-076

Division:

Division 2 General Federal Law

Number of paragraphs:

38

Date of hearing:

20 March 2024

Place:

Canberra

Counsel for the Applicant

Ms Erian of Counsel

Solicitors for the Applicant

Construction, Forestry and Maritime Employees Union

Counsel for the Respondents

Ms Costin of Counsel

Solicitors for the Respondents

Mills Oakley

ORDERS

CAG 37 of 2022

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)

BETWEEN:

CONSTRUCTION, FORESTRY AND MARITIME EMPLOYEES UNION
Applicant

AND:

AMK IMAGING PTY LTD
Second Respondent

ANTHONY GAVRAN
Third Respondent

ORDER MADE BY:	JUDGE W J NEVILLE
DATE OF ORDER:	20 MARCH 2024

THE COURT NOTES THAT:

A.The parties resolved matters of liability in principle on the first day of the Final Hearing;

B.The matter returned Court to determine matters of penalty, with oral reasons being delivered on 20^th March 2024; accordingly,

THE COURT ORDERS THAT:

1.By consent and pursuant to Part 13.3 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021, orders are made in terms of the attached document entitled “Proposed Orders” signed by the parties’ respective lawyers and placed with the Court record as attached hereto.

2.The Second Respondent is to pay a total penalty for the five contraventions of s.45 of the Fair Work Act 2009 (Cth) in the sum of $6,500.

3.The Second Respondent is to pay a penalty for the contravention of s.323 of the Fair Work Act 2009 (Cth) in the sum of $1,000.

4.The Second Respondent is to pay a penalty for the contravention of s.536 of the Fair Work Act 2009 (Cth) in the sum of $1,500.

5.Pursuant to s.550 of the Fair Work Act 2009 (Cth), the Third Respondent is to pay a total penalty for the admitted contraventions of the Fair Work Act 2009 (Cth) in the sum of $3,500.

6.The penalties ordered in Orders 1 – 5 hereof be paid to the Applicant within 90 days of this Order.

7.The funds to be paid to Mr Jayson Cocos, as set out in Consent Order 4, being the principal sum plus interest, are to be paid to him within 45 days.

Note: The form of the order is subject to the entry in the Court’s records.

Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).

REASONS FOR JUDGMENT

JUDGE W J NEVILLE

Introduction

1. In order to expedite the finalisation of this quite modest matter, ex tempore reasons were delivered on 20^th March 2024, shortly after the conclusion of a brief hearing regarding penalties.  They have been revised for publication from the transcript, and citations added, as follows.

2. The current Application was brought on behalf of a painter (Mr Cocos), who came from the Philippines.  By an Application filed 22^nd November 2022, together with a Statement of Claim filed at the same time, the Applicant alleged various contraventions for (among other things) under-payment of wages, non-payment (or under-payment) of various allowances, and payslips not provided, and therefore breaches of ss.323 and 536 of the Fair Work Act 2009 (Cth) (“the FW Act”), in relation to the individual Respondent, and accessorial liability in relation to the corporate Respondent under s.550 of the FW Act. An Amended Statement of Claim was filed on 21^st July 2023.

3. In its pleadings in Response, the Respondents denied liability and sought to have the Application dismissed.  Other matters were also pleaded, such as (a) Mr Cocos did, in fact, receive sufficient remuneration to compensate him for the entitlements sought in the Application, and that, (b) for example, Mr Cocos was not terminated but instead, his employment ceased when his visa expired.

4. During the course of the hearing, the parties ultimately (a) reached agreement regarding liability, and (b) prepared a Statement of Agreed Facts.  The agreed Orders and declarations regarding liability were made by consent and are set out herein.  It will be seen that, pursuant to those Orders, further payments were agreed to be paid by the Respondents to the Applicant.  The Statement of Agreed Facts is set out below.

   Statement of Agreed Facts

5. The Statement of Agreed Facts, dated 19^th March 2023, was as follows:

   Background

   1.This statement of agreed facts (SOAF) is made for the purposes for s 191 of the Evidence Act 1995 (Cth) and any admissions made are only for the purposes of these proceedings.

   2.This SOAF sets out the facts that the Applicant and the Second and Third Respondents have agreed for the purpose of these proceedings.

   Agreed Facts

   3.Between 2 January 2019 and 23 September 2022 (the Relevant Period), the Second Respondent was the employer of Jayson Cruz Cocos.

   4.Mr Cocos performed work as a painter under a contract of employment with the Second Respondent and was eligible to be a member of the Applicant during some or all of his employment by the Second Respondent.

   5.The Third Respondent was the Director of the Second Respondent and had active managerial control of the Second Respondent during the Relevant Period. The Third Respondent knew that an award applied to Mr Cocos’ employment but did not know the contents of the specific award. Mr Cocos advised the Third Respondent of the hours he was working, and the Third Respondent knew the amount that Mr Cocos was being remunerated. 

   6.Between 2 January 2019 and 28 February 2021, Mr Cocos’ employment was covered by the Building and Construction General On-Site Award 2010 (the 2010 Award). Between 1 March 2021 and 23 September 2022, Mr Cocos’ employment was covered by the Building and Construction General On-Site Award 2020 (the 2020 Award).

   7.The Second Respondent employed Mr Cocos on a full-time basis. Mr Cocos was classified as a CW3 worker under the Award.

   8.During his employment, Mr Cocos (a) started and finished work each day on job sites; and (b) frequently worked more than 38 hours per week.

   9.        During the Relevant Period, the Second Respondent:

   (a)did not provide Mr Cocos with copies of the National Employment Standards or the Award, as required by clause 5 of the 2010 Award and clause 3.3 of the 2020 Award; and

   (b)did not pay meal allowances to Mr Cocos, as required by clause 20.2 of the 2010 Award and clause 21.2 of the 2020 Award;

   (c) did not pay Mr Cocos’s wages on a regular, weekly schedule, as required by clause 31.3 of the 2010 Award and 20.3 of the 2020 Award;

   (d)did not provide Mr Cocos with payslips, as required by s 536 of the Fair Work Act 2009 (Cth) (the Act).

   10.Between 1 July 2021 and 23 September 2022, the Second Respondent did not pay travel allowances to Mr Cocos, as required by clause 26.1 of the 2020 Award.

   11.Between 21 January 2022 and 30 September 2022, the Second Respondent made deductions to Mr Cocos’ wages for rental accommodation which were not agreed to in writing, as required by 324 of the Act.

   12.On termination of his employment, the Second Respondent did not make a redundancy payment to Mr Cocos, as required by clause 41.3 of the 2020 Award.

   Oral submissions on behalf of the Applicant

6. At the outset of what I will call the “penalty hearing” on 20^th March 2024, and in the light of what had been earlier advised to the Court, the Court sought to clarify with Counsel for the Applicant that in relation to penalties, (a) an Affidavit would be provided by Mr Anthony Gavran (the Third Respondent), (b) there would be no Affidavit provided by the Applicant, and (c) there would be no opposition from the Applicant to the Respondents’ submissions regarding the penalty “range”.  It was confirmed that there would indeed be no opposition from the Applicant in respect of the penalty range, however, the Applicant intended to make brief submissions on relevant matters for the Court to consider regarding the determination of penalties.  The exchange was as follows (emphasis added):[1]

   … I had understood that there would be no argument regarding range of penalty, and perhaps I had misunderstood Ms Costin, but I had understood her to suggest that whatever submissions she would be making on behalf of the respondents, that there was not going to be any opposition to whatever the submission was in relation to penalties.  Have I misunderstood that?

   MS ERIAN:   There would be no opposition from the applicant – or rather there would be no response from the applicant – in respect of the penalty range, but we do intend to make fairly brief submissions on relevant factors that your Honour would have consideration of when determining an appropriate penalty.

   [1] T 19.  For completeness, and in no way critical of Counsel for either party, in oral submissions there was little or no reference to citations of authorities.  Written submissions were provided but only regarding liability.  Further, the Lists of Authorities provided by each party related solely to those concerning liability, not penalty.  I have provided the citations of cases referred to regarding penalty in these revised reasons.

7. An Affidavit was indeed provided on behalf of the Applicant, affirmed by Mr Cocos on 19^th March 2024, intended to contextualise the contravening conduct.  The parties also provided a Statement of Agreed Facts in addition to a Consent Minute of Orders on matters of liability, as set out above.

8. It was submitted that the Court must have regard to what is reasonably necessary to protect the public interest and to ensure deterrence from future conduct of a similar kind.  The list of non-exhaustive factors was identified by French J, as his Honour then was in Trade Practices Commission v CSR Ltd.[2]  It was accepted that the admitted contraventions are not of the most serious kind, and also that the Respondents have not previously contravened the provisions of the Fair Work Act. Despite this, it was submitted that the Court should have regard to the circumstances of Mr Cocos as set out in his Affidavit.[3]

   [2] Trade Practices Commission v CSR Ltd [1991] ATPR ¶41-076 at 52,152 – 52,153 (“TPC v CSR” or similar abbreviation).

   [3] Mr Cocos was not required for cross examination.  Nor was Mr Gavran so required.

9. It was submitted that, as a migrant worker, Mr Cocos is within a class of persons susceptible to employment exploitation due to his right to stay in Australia and visa requirements being connected to his employer or visa sponsor.  Mr Cocos arrived in Australia from the Philippines, sponsored by the Respondent, and it was submitted that he was, thereby, dependent on the Respondent to remain in Australia.  Under this arrangement, he would send money back to his family in the Philippines.  When he arrived, it was submitted that Mr Cocos’ language skills were not particularly sophisticated, he did not know Australian laws or employees’ rights, nor did he know how to navigate the employment “system” and ask the right questions.  The Respondent did not provide Mr Cocos with a copy of the National Employment Standards or the relevant Award, nor was he provided with pay slips.  It was submitted that this compounded his “limitations”.  It was submitted that Mr Cocos was entirely reliant on the Respondents to ensure that his rights were protected, and that he was properly remunerated.  It was submitted that these circumstances of the conduct would fall into the non-exhaustive list of factors set out by  French J in TPC v CSR Ltd.[4]

   [4] T 21 – 22

10. It was submitted also that the length of time that the contravening conduct persisted was an additional feature of the case.  Mr Cocos commenced employment with the Respondents in January 2019, and the contravening persisted across almost the entire period of employment.  It was accepted that the Respondents had admitted a failure to pay the travel allowance from July 2021 onwards, and that a sum of $17,000 was paid to Mr Cocos in June 2023 to pay back some of the underpayments, which were estimated to amount to $45,000.  It was submitted that this was a significant sum of money for Mr Cocos given his circumstances, and that effectively, Mr Cocos was underpaid more than $10,000 per year, which was approximately a 15 per cent underpayment.[5]  Counsel for the Applicant confirmed that there was no specific authority she could refer to that supported the Court having regard to the particular vulnerabilities of the worker involved.  However, she noted the broad categories identified by French J in CSR Ltd.[6]

    [5] T 22 – 23

    [6] See T 22 – 23

11. Thirdly, it was submitted that the Court should have regard to both general and “operative” deterrence.  Regarding general deterrence, the need to ensure employers take greater care in protecting employees’ rights, particularly those who are on business-sponsored visas, was highlighted.  Further, it was submitted that there exists a need to protect painters, a sub-category of the construction industry, who are a vulnerable category of worker.  With respect to operative specific deterrence, it was submitted that AMK Imaging continues to operate with Mr Gavran as the sole director.  Aside from the $17,000 payment, no further evidence has been adduced by the Respondents to demonstrate corrective action.[7]

    [7] T 23 – 24

12. Briefly, it was submitted that the admissions made by the Respondents were done on the first day of the liability hearing, after the parties had incurred most of the costs.  Accordingly, the cost savings were minimal.[8]

    [8] T 24

    Oral submissions on behalf of the Respondent

13. The Respondents relied on the same Affidavit filed for the purpose of the liability hearing deposed to by Mr Anthony Gavran (the Third Respondent) on 19^th February 2024, save for not reading a number of identified paragraphs.[9]

    [9] T 20; those include paragraphs 26, 40, 44 and 55.

14. It was submitted that Mr Gavran is remorseful, and that there was indeed a cost saving to the Court due to his admissions.  Further, this prevented Mr Cocos from having to be put through the difficult experience of cross-examination.  It was submitted that as soon as Mr Gavran was made aware of the $17,000 to be paid, he did so, acknowledging that it took him six months to make the payment which, according to the Respondents, was down to “calculation” issues.  It was also submitted that Mr Gavran provided a favourable reference for Mr Cocos to assist him in obtaining further employment.[10]

    [10] T 26

15. In relation to the five contraventions under s.45, relating to the breach of a “modern award”, the Respondents submitted the following.

16. The first contravention related to the failure to provide copies of the National Employment Standards as well as the relevant Awards to Mr Cocos.  It was submitted that, although not an excuse, the Respondents did not have the understanding of what was necessarily required under the award.  Hence, it was submitted that this was a reason for the contravention.  It was submitted that this matter concerns very unsophisticated respondents, where Mr Gavran himself is in the trade, and he does not have a sophisticated understanding of the law.  It was, therefore, submitted that the Court should impose a penalty of $1500, and that the five contraventions should be treated as a single course of conduct.[11]  There was no challenge from the Applicant to this submission.

    [11] T 26 – 27

17. In relation to meal allowance payments, it was stated that the award requires that a meal allowance be provided for at least one and a half hours after working ordinary hours, inclusive of time worked for actual accrual proposed, as prescribed in clauses 34 and 38 of the 2010 Award.  Hence, the amount which should have been paid was $15.38.  Under the 2020 award, the amount was $17.57.  It was submitted that this allowance was not to have been paid on a daily basis, and only when overtime occurred.  It was further submitted that the Respondents had already paid the amount sought by Mr Cocos to take reasonable steps to compensate any loss that he would have been entitled to.  There was no dispute that further money would be paid within 28 days to Mr Cocos.[12]

    [12] T 27 – 28

18. The third contravention under s.45 was the failure to pay wages on a weekly schedule as required by the Award. It was submitted that the nature of the trade was that Mr Gavran was not paying himself a regular wage either, and occasionally this meant that there was no money that was available for payment. When the cash flow was sufficient, the amount was paid when it fell due. This was not to excuse the conduct, but to highlight the reality of the trade.[13]

    [13] T 28

19. With respect to travel allowances, it was submitted that those should have been paid between 1^st July 2020 until 13^th September 2021, a period of 14 and a half months.  It was not disputed that a vehicle was provided to Mr Cocos and the other employees for a period of seven months, nor was it disputed that Mr Gavran did not request for it to be returned.  In fact, after a period of time, Mr Cocos instead purchased his own vehicle.  The vehicle provided to him by the Respondents was allowed to be used by Mr Cocos outside of work hours.  It was submitted that this showed that the Respondents had “goodwill” towards Mr Cocos, thereby also implying that there was no intention to exploit him.  Further, Mr Gavran was aware that it would have been impossible for Mr Cocos to obtain accommodation (which was also provided at relatively nominal cost, albeit that there was no written agreement that such cost was taken out of the pay of Mr Cocos, which was also acknowledged) and a vehicle without any assistance, including both rent payments and referees.  Accordingly, it was submitted that this showed that the Respondents should be penalised in the lowest range.[14]

    [14] T 28

20. In relation to s.44 and the breach of the National Employment Standards by failing to make a redundancy payment to Mr Cocos, it was submitted that the difference in defining redundancy in the 2020 version of the Award versus that captured under the FW Act would have been challenging to pick up on for an unsophisticated person such as Mr Gavran. Accordingly, it was submitted that although it was not paid, it was not due to ill intent but due to a lack of understanding. There was a full-time employment contract which covered four years, however, there was no permanency contract.[15]

    [15] T 29

1. With respect to s.546 of the Act, in relation to payslips, somewhat surprisingly, the Respondents had no relevant understanding that payslips were to be provided. 

2. In relation to the s.550 contravention, the matter of Fair Work Ombudsman & Devine Marine Group Pty Ltd was cited but not explained how it applied or was relevant to the submission here made.[16]  It was submitted that the contravention does not involve intent.  It was accepted that Mr Gavran had knowledge of the Award and Mr Cocos’ working time, as Mr Cocos would provide Mr Gavran with timesheets.  Mr Gavran never asked Mr Cocos whether the work that he said he worked was true.  There was no supervision, nor any challenge, to the hours in the timesheet.[17]

   [16] Fair Work Ombudsman v Devine Marine Group Pty Ltd [2014] FCA 1365.

   [17] T 29 – 30

3. In relation to the actual contravention under s.45, it was submitted that the Court should have regard to paragraphs 46-48 of the High Court decision in Pattinson.[18]It was submitted that there be a penalty in relation to the five contraventions under s.45 of $10,000, the contravention of s.323 in the sum of $1000 and the contravention of s.536 in the sum of $1500. Under s.550, a total of $5000 was submitted to be appropriate. Those payments would be made to the Applicant. Further, by consent, it was agreed that Mr Cocos pay Mr Cocos an additional $29,000, plus interest, in the amount of $650, within 28 days.[19]

   [18] Australian Building and Construction Commissioner v Pattinson (2022) 274 CLR 450.

   [19] T 33

4. In closing, submissions were reiterated as to the Third Respondent’s contrition, including a reference to Mr Gavran being a ‘religious man.’[20]

   [20] T 31

   Oral submissions on behalf of the Applicant in reply

5. In reply, it was submitted that the monies to be paid to Mr Cocos should not be considered in the assessment of penalties as those funds are agreed to be owing to Mr Cocos from the course of his employment with the Second Respondent.  Secondly, although no issue was taken to the submissions on Mr Gavran’s good character, it was highlighted that these do not mitigate penalties in respect of the Second Respondent.[21]

   [21] T 34

   Consideration & disposition

6. Earlier in these reasons I noted that there is now a Statement of Agreed Facts, which is of significant assistance.  Likewise, there is an agreed set of declarations and Orders to be made.  Those declarations and Orders were made by consent, which include provision for a further payment to be made to the Applicant.

7. The only remaining issue for the Court to determine relates to the appropriate penalty for the breaches of the Act, and certain awards.  There is no dispute that relevant principles regarding making such a determination was recently confirmed by the High Court in ABCC v Pattinson.[22]  From that case, it is sufficient, and important, to note the following principles, beginning with the plurality’s comments at [9] and [10] (internal citations omitted; emphasis added):

   [9] The Commissioner's contentions should be accepted and the appeal allowed. Under the civil penalty regime provided by the Act, the purpose of a civil penalty is primarily, if not solely, the promotion of the public interest in compliance with the provisions of the Act by the deterrence of further contraventions of the Act. In that context, the penalties fixed by the primary judge were appropriate because they were no more than might be considered to be reasonably necessary to deter further contraventions of a like kind by Mr Pattinson, the CFMMEU or others. They represented a reasonable assessment of what was necessary to make the continuation of the CFMMEU's non‑compliance with the law, amply demonstrated by the history of its contraventions, too expensive to maintain.

   [10] The Full Court's critical error was that it was distracted by a concern, drawn from the criminal law, that a penalty must be proportionate to the seriousness of the conduct that constituted the contravention. The power conferred by s.546 of the Act is not subject to constraints drawn from the criminal law and there is no place for a "notion of proportionality", in the sense in which the Full Court used that term, in a civil penalty regime. Further, and relatedly, their Honours were misled by the view that the Act required that the maximum penalty be reserved for only the most serious examples of the offending comprehended by s.349(1), and that this principle could prevent the court from imposing the maximum penalty even though a penalty in that amount might reasonably be considered to be necessary to deter future contraventions of a like kind. Nothing in the text, contextor purpose of s.546 requires that the maximum penalty be reserved for the most serious examples of misconduct within s.349(1).  What is required is that there be "some reasonable relationship between the theoretical maximum and the final penalty imposed".  That relationship is established where the maximum penalty does not exceed what is reasonably necessary to achieve the purpose of the deterrence of future contraventions of a like kind by the contravenor and by others^.

   [22] (2022) 274 CLR 450.

8. Matters to be considered in determining the appropriate penalty were set out by French J in TPC v CSR, and somewhat more recently by the Full Federal Court in Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith, where (at [89]) Buchanan J set out an even longer list of considerations, noting that such matters are not meant to be treated as a check-list, nor are they meant to be considered to be exhaustive.[23]  At [18] and [19] in Pattinson, the High Court noted the following (internal citations omitted):

   [23] Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith (2008) 165 FCR 560 at [89] – [91]. Both CSR Ltd and McAlary-Smith were cited with approval by the High Court in Pattinson, at [18] and [19] respectively.

   [18] In CSR, French J listed several factors which informed the assessment under the Trade Practices Act 1974 (Cth) of a penalty of appropriate deterrent value:

   "The assessment of a penalty of appropriate deterrent value will have regard to a number of factors which have been canvassed in the cases. These include the following:

   1. The nature and extent of the contravening conduct.

   2. The amount of loss or damage caused.

   3. The circumstances in which the conduct took place.

   4. The size of the contravening company.

   5. The degree of power it has, as evidenced by its market share and ease of entry into the market.

   6. The deliberateness of the contravention and the period over which it extended.

   7. Whether the contravention arose out of the conduct of senior management or at a lower level.

   8. Whether the company has a corporate culture conducive to compliance with the Act, as evidenced by educational programs and disciplinary or other corrective measures in response to an acknowledged contravention.

   9. Whether the company has shown a disposition to co‑operate with the authorities responsible for the enforcement of the Act in relation to the contravention."

   [19] It may readily be seen that this list of factors includes matters pertaining both to the character of the contravening conduct (such as factors 1 to 3) and to the character of the contravenor (such as factors 4, 5, 8 and 9). It is important, however, not to regard the list of possible relevant considerations as a "rigid catalogue of matters for attention" as if it were a legal checklist. The court's task remains to determine what is an "appropriate" penalty in the circumstances of the particular case.

9. I should note here that, among the range of disparate submissions, there was not much attention paid to the size or financial circumstances of the Respondents, other than it being noted that the Second Respondent had a maximum number of employees of perhaps 15, at any one time, and that cash-flow, from time to time, was tight (my words).

10. Returning to the High Court’s comments in Pattinson, at [46] – [48], the plurality said (emphasis added):[24]

    [46] It is important to recall that an "appropriate" penalty is one that strikes a reasonable balance between oppressive severity and the need for deterrence in respect of the particular case. A contravention may be a "one‑off" result of inadvertence by the contravenor rather than the latest instance of the contravenor's pursuit of a strategy of deliberate recalcitrance in order to have its way. There may also be cases, for example, where a contravention has occurred through ignorance of the law on the part of a union official, or where the official responsible for a deliberate breach has been disciplined by the union. In such cases, a modest penalty, if any, may reasonably be thought to be sufficient to provide effective deterrence against further contraventions.

    [47] The penalty that is appropriate to protect the public interest by deterring future contraventions of the Act may also be moderated by taking into account other factors of the kind adverted to by French J in CSR. For example, where those responsible for a contravention of the Act express genuine remorse for the contravention, it might be considered appropriate to impose only a moderate penalty because no more would be necessary to incentivise the contravenors to remain mindful of their remorse and their public expressions of that remorse to the court. Similarly, where the occasion in which a contravention occurred is unlikely to arise in the future because of changes in the membership of an industrial organisation, a modest penalty may be appropriate having regard to the reduced risk of future contraventions.

    [48] It is not necessary to multiply examples further. It is sufficient to say that a court empowered by s.546 to impose an "appropriate" penalty must act fairly and reasonably for the purpose of protecting the public interest by deterring future contraventions of the Act.

    [24] In oral submissions, Counsel for the Respondents emphasised [46] from Pattinson in particular as crucial for the Court’s determination of penalties in the current proceeding.

11. In my view, [46] in Pattinson neatly summarises the situation here, where inadvertence (and ignorance) more so than anything else, seems to have led to the unfortunate circumstances that gave rise to this Application.  Summarily, I note the following considerations that inform the Court’s determination of penalty in the light of the principles set out above:

    (a)The total underpayment was approximately $45,000.  Of this, the Respondents have already paid to the Applicant something in the order of $17,000.  It is agreed that the balance of funds owing will be paid;

    (b)The Respondents have no prior history of contravention;

    (c)The Respondents are contrite in relation to the errors that led to the under-payments (I mean no offence to anyone, however, Mr Gavran’s religious affiliation or convictions, which are not before the Court, as submitted, have no relevance to his “contrition” before the Court.  Among other observations, devout atheists can be, and often are, properly contrite in similar circumstances);

    (d)Admissions were reasonably made.  The parties reached agreement regarding liability, albeit after the hearing commenced;

    (e)The difficult circumstances of the Applicant, who supports his family by work in Australia (which continues with another company);

    (f)It is agreed that the contraventions, and circumstances that gave rise to them, are at the lower end of seriousness or gravity; and

    (g)The Respondents have shown, certainly before the Court during the hearing, a significant disposition not only of contrition but also of co-operation.

12. The Applicant has confirmed that it will not oppose the Respondents’ submissions regarding penalty.  I do not take this to mean, necessarily, that they, therefore, put a consent position, regarding the proposed penalties.

13. There are 5 contraventions of s.45 of the Act admitted. It is also agreed that these should be treated as a single course of conduct. The Applicant submitted that a total penalty of $10,000 should apply to these five contraventions. In the light of the Statement of Agreed Facts, and the High Court’s principles in Pattinson, perhaps especially since this is a “first time offender” (to speak colloquially), in my view, an appropriate penalty for these contraventions should be, in total, $6,500.

14. I accept the Respondents’ submissions regarding the admitted contravention of s.323 of the Act. In the light of the agreed factual matters, and the principles set out by the High Court in Pattinson, the penalty here shall be fixed at $1,000.

15. In relation to the admitted breach of s.536 of the Act, regarding the failure to provide the Applicant with pay-slips, I also accept the Respondents’ submissions for the imposition of a penalty of $1,500.

16. In relation to the liability of the company under s.550 of the Act, the penalty for this admitted contravention shall be $3,500.

17. The Applicant indicted that it would accept a time-payment arrangement for the payment of penalties.  For my part, I would simply make an Order that, in the absence of any other agreement in writing between the parties, the penalties are to be paid to the Applicant within 90 days.

18. In relation to the funds to be paid to Mr Cocos, set out in Consent Order 4, the principal sum, plus interest, are to be paid to him within 45 days.

I certify that the preceding thirty-eight (38) numbered paragraphs are a true copy of the Reasons for Judgment of Judge W J Neville.

Associate:

Dated:       24 April 2024