Construction, Forestry, Maritime, Mining and Energy Union v Asbestos Removalist Pty Ltd
[2019] FCCA 2977
•17 October 2019
FEDERAL CIRCUIT COURT OF AUSTRALIA
| CONSTRUCTION, FORESTRY, MARITIME, MINING AND ENERGY UNION v ASBESTOS REMOVALIST PTY LTD & ANOR | [2019] FCCA 2977 |
| Catchwords: INDUSTRIAL LAW – Application for civil penalty – first respondent in liquidation – findings as to liability of second respondent – subsequently declared bankrupt – appropriate penalty. |
| Legislation: Bankruptcy Act 1966 (Cth) ss.60, 82 Fair Work Act 2009 (Cth), ss.539, 546, 557 |
| Cases cited: Construction, Forestry, Maritime, Mining and Energy Union v Asbestos Removalist Pty Ltd & Anor [2019] FCCA 529 |
| Applicant: | CONSTRUCTION, FORESTRY, MARITIME, MINING AND ENERGY UNION |
| First Respondent: | ASBESTOS REMOVALIST PTY LTD (ACN 098 820 181) (IN LIQUIDATION) |
| Second Respondent: | TIZIANO BETTINSOLI |
| File Number: | MLG 1056 of 2017 |
| Judgment of: | Judge O'Sullivan |
| Hearing date: | 16 October 2019 |
| Date of Last Submission: | 16 October 2019 |
| Delivered at: | Melbourne |
| Delivered on: | 17 October 2019 |
REPRESENTATION
| Counsel for the Applicant: | Ms Burke |
| Solicitors for the Applicant: | Slater and Gordon |
| Counsel for the First Respondent: | No appearance |
| Solicitor for the First Respondent: | No appearance |
| Counsel for the Second Respondent: | No appearance |
| Solicitor for the Second Respondent: | No appearance |
ORDERS
Pursuant to s.546(1) of the Fair Work Act 2009 (Cth) (“FW Act”), the second respondent pay a penalty of $3,300.00 in respect of the contraventions set out in declaration 1(a) of the orders of Judge Hartnett dated 8 March 2019.
Pursuant to s.546(1) of the FW Act, the second respondent pay a penalty of $2,200.00 in respect of the contraventions set out in declaration 1(b) of the orders of Judge Hartnett dated 8 March 2019.
Pursuant to s.546(1) of the FW Act, the second respondent pay a penalty of $2,200.00 in respect of the contraventions set out in declaration 1(c) of the orders of Judge Hartnett dated 8 March 2019.
Pursuant to s.546(1) of the FW Act, the second respondent pay a penalty of $5,100.00 in respect of the contraventions set out in declaration 1(d) of the orders of Judge Hartnett dated 8 March 2019.
Pursuant to s.546(1) of the FW Act, the second respondent pay a penalty of $10,200.00 in respect of the contraventions set out in declaration 1(e) of the orders of Judge Hartnett dated 8 March 2019.
Pursuant to s.546(1) of the FW Act, the second respondent pay a penalty of $6,000.00 in respect of the contraventions set out in declaration 1(f) of the orders of Judge Hartnett dated 8 March 2019.
Pursuant to s.546(1) of the FW Act, the second respondent pay a penalty of $4,000.00 in respect of the contraventions set out in declaration 1(g) of the orders of Judge Hartnett dated 8 March 2019.
Pursuant to s.546(1) of the FW Act, the second respondent pay a penalty of $10,200.00 in respect of the contraventions set out in declaration 1(h) of the orders of Judge Hartnett dated 8 March 2019.
Pursuant to s.546(3) of the FW Act, the second respondent pay the total penalties of $43,200.00 in orders (1) to (8) above to the applicant, within 28 days of the date of this order.
The applicant serve the second respondent, and his trustee in bankruptcy, with a copy of these orders within 14 days.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLG 1056 of 2017
| CONSTRUCTION, FORESTRY, MARITIME, MINING AND ENERGY UNION |
Applicant
And
| ASBESTOS REMOVALIST PTY LTD (ACN 098 820 181) (IN LIQUIDATION) |
First Respondent
| TIZIANO BETTINSOLI |
Second Respondent
REASONS FOR JUDGMENT
Introduction
1.These reasons concern the civil penalties that should be imposed as a result of the findings made in March 2019 of breaches of the Fair Work Act 2009 (Cth) (“the FW Act”).
Background
2.In 2017, the Construction, Forestry, Maritime, Mining and Energy Union (“the applicant”), as it then was, commenced proceedings against Asbestos Removalists Pty Ltd (“the first respondent”) and Tiziano Bettinsoli (“the second respondent”).
3.The applicant alleged breaches by the first respondent, which the second respondent was involved in, of the FW Act and applicable industrial instruments arising from the employment of three employees.
4.In summary form, it was alleged, between 2010 and 2015, Messrs Castillo, Torres and Jopling were employed by the first respondent and were variously covered by the ‘Asbestos Removalist Pty Ltd and CFMEU Building and Construction Industry Enterprise Agreement 2008-2011’ (“the 2008-2011 Agreement”), the ‘Asbestos Removalist Pty Ltd and CFMEU Building and Construction Industry Enterprise Agreement 2011-2015’ (“the 2011-2015 Agreement”) (“the Agreements”) and the FW Act.
5.It was further alleged that the above mentioned employees were not paid various allowances, rates of pay and superannuation by the first respondent and as the second respondent (who was a director of the first respondent) was involved in those contraventions he was also separately liable.
6.After the proceedings had been commenced, the first respondent, who had previously made admissions in relation to the alleged contraventions, was placed into liquidation. The applicant did not seek to pursue the first respondent and the proceedings continued as against the second respondent who denied liability.
Liability Judgment
7.On 8 March 2019, and for the reasons set out in Construction, Forestry, Maritime and Energy Union v Asbestos Removalist Pty Ltd & Anor [2019] FCCA 529 (“the Liability Judgment”), Judge Hartnett (as Her Honour then was) declared that the second respondent, for the purposes of s.550 of the FW Act, was involved in contraventions of the FW Act and the Agreements by the first respondent.
8.In the Liability Judgment, Her Honour set out the background, allegations made, orders sought and material relied on at paragraphs [1] to [12]. The Liability Judgment then set out the relevant provisions of the FW Act and the authorities on same at paragraphs [13] to [20] before dealing with a submission made by the second respondent, the evidence and pleadings before the Court and the findings Her Honour made in relation to same at paragraphs [21] to [47] inclusive.
Declarations and orders made
9.For the reasons set out in the Liability Judgment, the following orders were made:
“THE COURT DECLARES THAT:
(1)The second respondent was involved in each of the following contraventions, in relation to Mr Cesar Torres, Mr James Jopling and Mr Jimmy Alexis Castillo Soto, pursuant to s.550 of the Fair Work Act 2009 (Cth):-
(a)breach of Clause 25.1.12 — Asbestos eradication of the National Building and Construction Industry Award 2000 (‘the Award’) which was incorporated into the Asbestos Removalist Pty Ltd and the CFMEU Building and Construction Industry Enterprise Agreement 2008 - 2011 (‘the 2008-2011 Agreement’);
(b)breach of Appendix B — Pay Rates of the 2008-2011 Agreement;
(c)breach of Clause 22 — Fares and Travelling Allowance of the 2008-2011 Agreement;
(d)breach of Clause 29 — Superannuation of the 2008-2011 Agreement;
(e)breach of Clause 2 of Appendix K - Wages and Conditions of Employment for Workers engaged in asbestos eradication of the Asbestos Removalist Pty Ltd and the CFMEU Asbestos Removal Enterprise Agreement 2011-2015 ('the 2011-2015 Agreement');
(f)breach of Appendix B – Pay Rates of the 2011-2015 Agreement;
(g)breach of Clause 24- Fares and Travelling Allowance of the 2011-2015 Agreement;
(h)breach of Clause 31- Superannuation of the 2011-2015 Agreement
THE COURT ORDERS THAT:
(2)The proceedings be adjourned for a penalty hearing on a date to be fixed.”
10.Following these orders, and the appointment of Her Honour to the Family Court of Australia, the proceedings were re-docketed to the Court as currently constituted.
11.There were then, by consent, orders made for payment of compensation and interest to the employees to reflect the finding in the Liability Judgment[1] and directions made for the proceedings to be set down for a penalty hearing[2] on 16 October 2019.[3]
[1] see orders of 1 April 2019
[2] see orders of 3 May 2019
[3] Annexure A to these reasons is Exhibit A2 (a chronology prepared by the applicant’s solicitors) which provide details of events between the directions hearing in May 2019 and the penalty hearing on 16 October 2019.
Bankruptcy and the second respondent
12.Following the matter being fixed for a penalty hearing, and on 11 July 2019, the second respondent was declared bankrupt and Mr Matthew Gollant was appointed trustee pursuant to s.60(2) of the Bankruptcy Act 1986 (Cth). He had notice of the proceedings and wrote to the Court in August 2019.
13.In Fair Work Ombudsman v Al Hilfi [2016] FCA 193 the Federal Court considered whether to impose a civil penalty in circumstances where a party had been made bankrupt and said:
“…
44.As to the first matter, s 58(3) of the Bankruptcy Act 1966 (Cth) provides as follows:
(3)Except as provided by this Act, after a debtor has become a bankrupt, it is not competent for a creditor:
(a) to enforce any remedy against the person or the property of the bankrupt in respect of a provable debt; or
(b) except with the leave of the Court and on such terms as the Court thinks fit, to commence any legal proceeding in respect of a provable debt or take any fresh step in such a proceeding.
45.This subsection does not act as a bar to the imposition of pecuniary penalties in this proceeding. The FWO is not a creditor of Mr Albarouki and the proceedings do not concern a provable debt owed by Mr Albarouki.
46.Section 60(1) of the Bankruptcy Act permits the Court to stay legal proceedings in certain circumstances. It provides as follows:
(1)The Court may, at any time after the presentation of a petition, upon such terms and conditions as it thinks fit:
(b) stay any legal process, whether civil or criminal and whether instituted before or after the commencement of this subsection, against the person or property of the debtor:
(i)in respect of the non-payment of a provable debt or of a pecuniary penalty payable in consequence of the non-payment of a provable debt; or
(ii)in consequence of his or her refusal or failure to comply with an order of a court, whether made in civil or criminal proceedings, for the payment of a provable debt;
and, in a case where the debtor is imprisoned or otherwise held in custody in consequence of the non-payment of a provable debt or of a pecuniary penalty referred to subparagraph (i) or in consequence of his or her refusal or failure to comply with an order referred to in subparagraph (ii), discharge the debtor out of custody.
47.Neither Mr Albarouki nor his controlling trustees in bankruptcy have applied to the Court for a stay of this proceeding under s 60(1) of the Bankruptcy Act. As the FWO submits, in any event, this subsection has no application to the proceedings because the proceedings do not relate to the non-payment of a provable debt owed by Mr Albarouki or a penalty payable in consequence of the non-payment of a provable debt owed by him. In the circumstances, there is no need for the Court to consider staying the proceedings of its own motion. The pecuniary penalties in this case are in respect of Mr Albarouki’s alleged involvement in contraventions of Commonwealth workplace laws by Mr Al Hilfi. The remedy sought against Mr Albarouki is not, and does not concern, debts provable in the bankruptcy.
48.Section 82 of the Bankruptcy Act provides for debts provable in bankruptcy and, relevantly, is to the following effect:
(1)Subject to this Division, all debts and liabilities, present or future, certain or contingent, to which a bankrupt was subject at the date of the bankruptcy, or to which he or she may become subject before his or her discharge by reason of an obligation incurred before the date of the bankruptcy, are provable in his or her bankruptcy.
…
(3)Penalties or fines imposed by a court in respect of an offence against a law, whether a law of the Commonwealth or not, are not provable in bankruptcy.
49.The pecuniary penalties that may be imposed in this case under s 546 of the FW Act fall within the terms of s 82(3) of the Bankruptcy Act and are not debts provable in the bankruptcy: Mathers and Another v Commonwealth (2004) 134 FCR 135; Cotis v MacPherson (2007) 169 IR 30; Fair Work Ombudsman v Bundy Market Meats Pty Ltd (2009) 190 IR 180.
50.I accept the FWO’s submission that the pecuniary penalties sought in this case are not provable against Mr Albarouki in bankruptcy and s 60(1) of the Bankruptcy Act has no application to this proceeding.” (emphasis added)
14.Later, and in Fair Work Ombudsman v Grouped Property Services Pty Ltd (No.2) [2017] FCA 557 at [386] the Federal Court noted that:
386.All the contraventions involve breaches of “civil remedy provisions” of the FW Act. That means that the Court has the power to make orders for the payment of pecuniary penalties: FW Act, s 546(1). An order for a pecuniary penalty may be made in addition to any other order: FW Act, s 546(5). The penalty, or part of it, may be made payable to the Commonwealth, a particular organisation, or a particular person: FW Act, s 546(3). The Court is not precluded from making an order against Rosario for the payment of a pecuniary penalty as penalties or fines imposed by courts are not provable debts in bankruptcy: Bankruptcy Act, s 82(3). I am well satisfied that this is a proper case for the imposition of pecuniary penalties.” (emphasis added)
Penalty Hearing
15.At the penalty hearing on 16 October 2019, the applicant, who was represented by Ms Burke of Counsel, relied upon the following:
· affidavit of James Jopling dated 6 August 2018;
· affidavit of Cesar Torres dated 13 August 2018;
· affidavit of Jimmy Alexis Castillo Sotto dated 15 November 2018;
· oral evidence of Cesar Torres led at liability hearing;
· affidavit of Peter Clark dated 14 August 2018;
·letter from the CFMEU to Mr Bettinsoli dated 23 October 2015 – tendered as Exhibit PC-1 to the affidavit of Peter Clark dated 14 August 2018;
·letter from the CFMEU to Mr Bettinsoli dated after 23 September 2015 – tendered as Exhibit PC-2 to the affidavit of Peter Clark dated 14 August 2018;
·initial report to Creditors of Asbestos Removalist Pty Ltd (the First Respondent) by liquidators Robyn Erskine and Adrian Hunter, dated 15 June 2018 – tendered as Exhibit PC-3 to the affidavit of Peter Clark dated 14 August 2018;
· evidence to be tendered at the penalty hearing;
·extract from the National Personal Insolvency Index dated 11 September 2019 for Tiziano Claudio Bettinsoli;
·initial Information for Creditors of Tiziano Bettinsoli by trustee Matthew Gollant, dated 6 August 2019;
·affidavit of Carita Jaime Kazakoff dated 15 October 2019;
·extract from ASIC records of current and historical records of Asbestos Removalist Pty Ltd (ACN 098 820 181) (the First Respondent) as at 14 October 2019;
·extract from ASIC records of current and historical records of Asbestos Removalist (Aust) Pty Ltd (ACN 132 993 438) as at 14 October 2019;
·second report to Creditors of Asbestos Removalist Pty Ltd (the First Respondent) by liquidators Robyn Erskine and Adrian Hunter, dated 28 August 2018;
· document titled ‘Current Structure: Bettinsoli Group’;
· the Asbestos Removalist (Aust) Pty Ltd Enterprise Agreement 2018.
16.There was no appearance by or on behalf of the respondents.
17.Civil penalties may be imposed under s.546 of the FW Act against the second respondent because they fall within the exception in s.82(3) of the Bankruptcy Act 1966 (Cth) and the debts are therefore, not debts provable in bankruptcy.
18.Given the orders made on 3 May 2019, that the Court was satisfied that the second respondent (and his trustee in bankruptcy) had notice of those orders, and that the applicant intended to press for orders for civil penalties against the second respondent, the applicant was granted leave to proceed in the face of his non-appearance.
Principles relevant to the determination of penalty
19.In Fair Work Ombudsman v NSH North Pty Ltdtrading as New Shanghai Charlestown [2017] FCA 1301 at [36] the Court recorded the approach the Court must take in determining penalties:
(a)Step One: the Court is to identify the separate contraventions involved. For the purposes of s 539(2), each contravention of an obligation located in the FW Act constitutes a separate contravention of a civil remedy provision of the FW Act;[4]
(b)Step Two: the Court should consider whether any of the breaches taken together constitute a single course of conduct pursuant to s 557(1) such that multiple contraventions should be treated as a single contravention;
(c)Step Three: to the extent that two or more contraventions have common elements, this should be taken into account in considering what an appropriate penalty is in all the circumstances for each contravention. The respondents should not be penalised more than once for the same conduct. The penalties imposed by the Court should be an appropriate response to the respondents’ actions.[5] Importantly, this third task is distinct from, and in addition to, the final application of the “totality principle”;[6]
(d)Step Four: the Court will consider an appropriate penalty to impose in respect of each contravention, whether a single contravention, a course of conduct, or group of contraventions, having regard to all of the circumstances of the case; and
(e)Step Five: having fixed an appropriate penalty for each contravention, the Court should then review the aggregate penalty so as to determine whether it is an appropriate response to the contravening conduct.[7] In doing so, the Court should apply an “instinctive synthesis” in making this assessment.[8] This final step is commonly known as the “totality principle”.[9]
[4] Gibbs v The Mayor, Councillors and Citizens of City of Altona (1992) 37 FCR 216, 223 (Gray J); McIver v Healey [2008] FCA 425, [16] (Marshall J).
[5]Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8, [71] (Graham J).
[6]Mornington Inn Pty Ltd v Jordan [2008] FCAFC 70, [41]-[46] (Stone and Buchanan JJ).
[7] see Kelly v Fitzpatrick [2007] FCA 1080, [30] (Tracey J): Australian Ophthalmic Supplies, [23] (Gray J), [71] (Graham J) and [102] (Buchanan J).
[8] Australian Ophthalmic Supplies, [27] (Gray J), [55] and [78] (Graham J).
[9] see Fair Work Ombudsman v NSH North Pty Ltdtrading as New Shanghai Charlestown (2017) FCA 1301.
20.The applicant’s submissions addressed the non-exhaustive considerations identified in Kelly v Fitzpatrick [2007] FCA 1080, which were as follows:
(a)the nature and extent of the conduct which led to the breaches;
(b)the circumstances in which that conduct took place;
(c)the nature and extent of any loss or damage sustained as a result of the breaches.;
(d)whether there had been similar previous conduct by the respondents;
(e)whether the breaches were properly distinct or arose out of the one course of conduct;
(f)the size of the business enterprise involved;
(g)whether or not the breaches were deliberate;
(h)whether senior management was involved in the breaches;
(i)whether the party committing the breach had exhibited contrition;
(j)whether the party committing the breach had taken corrective action;
(k)whether the party committing the breach had co-operated with the enforcement authorities;
(l)the need to ensure compliance with minimum standards by provision of an effective means for investigation and enforcement of employee entitlements; and
(m)the need for specific and general deterrence.
The contraventions
21.The applicant’s submissions at paragraph [9] helpfully set out each of the contraventions recorded in the Liability Judgment, as follows:
“(a) in relation to Mr Castillo:
i.clause 25.1.12 of the Award as incorporated into the 2008-2011 Agreement by Clause 6 and Appendix G (asbestos allowance;
ii.clause 29 of the 2008-2011 Agreement (superannuation);
iii.clause 2 (asbestos allowance) of Appendix K of the 2011-2015 Agreement;
vi.clause 2 (consolidated allowance) of Appendix K of the 2011- 2015 Agreement;
v. appendix B (wages) of the 2011-2015 Agreement;
vi.clause 24 of the 2011-2015 Agreement (fares and travelling allowance);
vii.clause 31 of the 2011-2015 Agreement (superannuation);
(b) in relation to Mr Torres:
i.clause 25.1.12 of the Award as incorporated into the 2008-2011 Agreement by Clause 6 and Appendix G (asbestos allowance;
ii.appendix B of the 2008-2011 Agreement (pay rates);
iii.clause 22 of the 2008-2011 Agreement (fares and travelling allowance);
iv.clause 29 of the 2008-2011 Agreement (superannuation);
v.clause 2 (asbestos allowance) of Appendix K of the 2011-2015 Agreement;
vi.clause 2 (consolidated allowance) of Appendix K of the 2011- 2015 Agreement;
viiappendix B (wages) of the 2011-2015 Agreement;
viii.clause 24 of the 2011-2015 Agreement (fares and travelling allowance);
ix.clause 31 of the 2011-2015 Agreement (superannuation);
(c) in relation to Mr Jopling:
i.clause 2 (asbestos allowance) of Appendix K of the 2011-2015 Agreement;
ii.clause 2 (consolidated allowance) of Appendix K of the 2011- 2015 Agreement;
iii.appendix B (wages) of the 2011-2015 Agreement;
iv.clause 24 of the 2011-2015 Agreement (fares and travelling allowance);
v.clause 31 of the 2011-2015 Agreement (superannuation).”
Course of conduct and grouping
22.Section 557(1) of the Act provides as follows:
“For the purposes of this Part, two or more contraventions of a civil remedy provision referred to in subsection (2) are, subject to subsection (3), taken to constitute a single contravention if: (a) the contraventions are committed by the same person; and (b) the contraventions arose out of a course of conduct by the person.”
23.In summary, s.557 does not apply to contraventions of different terms even if such contraventions arise out of the course of conduct and even if the contraventions only affect one person. Instead, s.557 applies to multiple contraventions of the one term (of, for example, a modern award), even where it may affect two or more persons.
24.The applicant’s submissions set out each of the contraventions found in the Liability Judgment which amounted to 21 separate contraventions. However, Annexure B to these reasons contain what Counsel for the applicant (who tendered same) described at the penalty hearing as her client’s alternative submissions.
25.It was conceded by Counsel for the applicant at the penalty hearing that were the Court to proceed by applying the approach to s.557 of the FW Act as set out in Rocky Holdings Pty Ltd v Fair Work Ombudsman [2014] FCAFC 62 to those contraventions this would result in 8 contraventions grouped as follows:
Proposed Grouping Maximum Penalty 2nd Respondent Cl 25.1.12 of Award 2008-2011 (Asbestos Allowance) $6,600.00 Cl 29 of 2008-2011 Agreement (Superannuation) $6,600.00 Cl 2 of Appendix K of 2011-2015 Agreement (Asbestos & Consolidated Allowance) $10,200.00 Cl B of Appendix K of 2011-2015 Agreement (Wages) $10,200.00 Cl 24 of 2011-2015 Agreement (Fares & Travelling Allowance) $10,200.00 Cl 31 of 2011-2015 Agreement (Superannuation) $10,200.00 Appendix B of 2008-2011 Agreement (Wages) $6,600.00 Cl 22 of 2008-2011 Agreement (Fares & Travelling Allowance) $6,600.00 26.This approach also properly reflects the overlap or commonality between the contraventions recorded in the Liability Judgment.
The nature, extent and circumstances of the conduct which led to the breaches;
27.The applicant’s written submissions address this consideration at paragraphs [15] to [17].
28.The applicant submitted that the employees undertook heavy and potentially dangerous work for the first respondent. It was submitted two of the employees commenced work within a reasonably short period of arrival in Australia and were therefore open to exploitation due to their lack of understanding of Australian workplace regulation.[10]
[10] see for example, PCB 288-289 at [1-3] and PCB 573-574 at [1-3].
29.The contravening conduct continued over an extended period of approximately five and a half years and resulted in substantial underpayments of a range of entitlements. It was also submitted the Court should note the complaints made by the employees to the second respondent during the claim periods and the second respondent’s failure to take corrective action.
30.The applicant also submitted that, as a result of the first respondent’s record keeping practices, it was difficult to accurately determine employee entitlements.[11] The applicant submitted that perhaps even more egregiously, the second respondent had also made excuses for the underpayments and provided the employees with incorrect information about their entitlements.[12]
[11] see for example, PCB 289 at [6], 290 at [13], PCB 574 at [9] and PCB 242 at [9]
[12] see paragraphs [38] to [40] of Construction, Forestry, Maritime, Mining and Energy Union v Asbestos Removalist Pty Ltd & Anor [2019] FCCA 529
The nature and extent of any loss or damage sustained as a result of the breaches;
31.The applicant’s written submissions addressed this consideration at paragraph [18].
32.As noted above, the applicant submitted the employees suffered significant financial loss as shown by the orders made for compensation. The total compensation ordered in the proceeding was $54,263.26 and the second respondent, who was represented when those orders were made, had not complied.
Whether there has been similar previous conduct by the respondents;
33.The applicant’s written submissions addressed this consideration at paragraph [19].
34.Although there are no previous findings about the second respondent’s previous conduct, the applicant submitted that there was evidence before the Court that substantial breaches of particularly, the obligations to pay superannuation had been occurring prior to the claim periods.[13]
[13] see transcript 18 November 2018 p 66- 8 and PCB 513-514 and 708.
35.The applicant submitted that the lack of any prior matter having been brought against the respondents in the current proceedings counts for little in circumstances where the first and second respondents were plainly on notice as to what was required to comply with the FW Act.[14]
[14] see Fair Work Ombudsman v NHS North Pty Ltd trading as New Shanghai Charleston [2017] FCA 1301
36.The absence of previous similar conduct is not a mitigating factor, but means that there is no evidence of that nature which might otherwise have contributed to an increase in the penalty imposed.[15]
[15] Sayed v Construction, Forestry Mining and Energy Union (No.2) [2015] FCA 338 at [51]
Whether the breaches were properly distinct or arose out of one course of conduct
37.The applicant’s written submissions addressed the consideration at paragraph [20].
38.It is alleged that there are distinct contraventions arising for each no-compliance with an entitlement or obligation in each cause for each relevant employee. The applicant initially submitted that the Court should consider that there were 21 distinct contraventions of the Agreements. However, for the reasons referred to earlier, given the provisions of s.557 of the FW Act there are 8 contraventions grouped as set out earlier.
The size of the business enterprise involved;
39.The applicant’s written submissions addressed this consideration at paragraph [21].
40.The applicant submitted there was evidence that the first respondent had approximately 20 employees.[16] It was submitted there was also evidence that the first respondent engaged supervisors and an operations manager.[17] The first respondent was of a size to tender for work on Melbourne commercial building sites and held licences to remove asbestos. Beyond this, Counsel for the applicant accepted this wasn’t a relevant factor.
[16] see PCB 439 at [6]
[17] see PCB 245, 293 and 577
Whether or not the breaches were deliberate;
41.The applicant’s written submissions addressed this consideration at paragraphs [22] to [26].
42.The applicant submitted as the proceeding sought findings and consequential orders against the second respondent as an accessory pursuant to s.550 of the FW Act, the Liability Judgment made finding as to the relevant mental element required for accessorial liability of the second respondent.[18]
[18] the relevant part of the Liability Judgment is at [24]-[46], particularly at [33]-[43].
43.The Court concluded at that
“…the evidence …confirms the involvement of the second respondent, and the second respondent’s actual knowledge and active participation in failing to pay the employees pursuant to the Enterprise Agreements, breaches in relation to payments; and other obligations in the Enterprise Agreements, which breaches were ongoing.”[19]
[19] the relevant part of the Liability Judgment is at [35]-[37]
44.On the material in the Liability Judgment it is clear that the second respondent acted as “the mind and the hands” of the first respondent and therefore:
“The inference to be drawn from the evidence of the employees is that the second respondent knew the correct hourly rates and allowances under the Enterprise Agreements, but was seeking to avoid payment in accordance with the Enterprise Agreements.”
45.At [41] of the Liability Judgment, the Court stated:
“…the evidence does not support any “genuine mistake” claim pleaded to by the second respondent. Rather the evidence suggests a deliberate strategy, of which the second respondent had actual knowledge, to underpay or not pay employees their rates and entitlements as provided for in the Enterprise Agreements.”
46.The applicant submitted that the failure of the respondents to correct the breaches after those breaches were brought to the respondents’ attention by the employees, the applicant and the issuing of Court proceedings, indicates that the conduct of the second respondent was deliberate and calculated.
47.The applicant submitted that the second respondent has failed to comply with the orders made by this Court on 1 April 2019. No payments have been received pursuant to these orders. This is despite the fact that the second respondent indicated to Mr Torres in November 2018, that the second respondent had access to funds to pay Mr Torres.[20]
[20] see transcript 19 November 2018, p 33 L35-45
Whether senior management was involved in the breaches;
48.The applicant’s written submissions addressed this consideration at paragraph [27] to [28].
49.As stated above, the Court found that the second respondent was “the mind and the hands” of the first respondent, and the second respondent was personally involved in the contravening conduct, had actual knowledge of the conduct and was the decision maker of the business. The applicant submitted there was a causative nexus between the second respondent’s involvement and the loss suffered by the employees.
50.The Court also found that the second respondent was:
“A director shareholder, secretary and manager of the first respondent:
·responsible for managing the employment of employees on behalf of the first respondent;
·responsible for making the payment of wages to the employees of the first respondent;
·responsible for approving and processing employees’ pays on behalf of the first respondent;
·responsible for managing employment relations between the first respondent and its employees on behalf of the first respondent and ensuring that the second respondent and the first respondent were aware of, and complied with, all relevant laws including the Fair Work Act.”[21]
[21] see [25] (a) to (d) of the Liability Judgment
Contrition, corrective action and co-operation;
51.The applicant’s written submissions addressed the consideration of contrition at paragraph [29] to [36]. It was submitted there had been no contrition shown. The second respondent did not cooperate with the applicant (or the employees) in resolving the underpayments despite repeated requests. The employees have not received any of the entitlements that were underpaid. Even the lesser amounts which were effectively admitted as owed in the defence, dated 8 August 2017, have not been paid to the employees.
52.The applicant submitted that the calculations made in the defence were incorrect and indicated a much lower level of underpayment than the amounts the Court found were owed. The applicant noted that the Court found that the applicant’s amended calculations were correct and the other calculations were not relied upon by the second respondent at the hearing.
53.The applicant noted the evidence of Mr Torres of his conversation with the second respondent shortly before 19 November 2018, and submitted that this confirmed that the second respondent has shown no contrition and remained committed to avoiding his obligations.
54.The applicant submitted that the second respondent contested the proceeding, there was no ‘plea’. The employees were required to attend court on 19 November 2018 and therefore suffered further loss of wages for that day and for attendances to prepare affidavits and to prepare for the hearing. The applicant submitted (and I accept) that no discount in the level of penalties assessed should be made as the second respondent has not shown contrition.
55.In addition, the applicant submitted that the Court should conclude that the conduct of the second respondent goes further than merely a failure to show contrition. It was submitted that the evidence indicates that the second respondent has continued to pursue a strategy to avoid the consequences of the conduct. It was submitted that just as contrition may mitigate a potential penalty, adopting a strategy to avoid the consequences of contravening conduct can aggravate the contravention.
56.The applicant’s submissions at paragraph [34] identified the relevant material facts contained within the Liability Judgment as follows:
“a) deliberate conduct as found in the Liability Judgment;
b)the applicant placed the first and second respondents on notice of the employees’ underpayment claims from 2015;
c)on 23 May 2017, the applicant issued the present proceeding against the First and second respondents.
d)ASIC records indicate that the second respondent’s sons, Pablo Bettinsoli and Matias Bettinsoli, ceased to be directors of the first respondent on 26 May 2017. The notice to ASIC of this change of directors was not received by ASIC until 23 June 2017. This change left the second respondent as the sole director of the first respondent;
e)the second respondent told the liquidator that the business of the first respondent ceased in June 2017;
f)on 22 or 23 June 2017, ASIC was advised that the second respondent had ceased to be a director of another company, Asbestos Removalist (Aust) Pty Ltd on 26 May 2017. By 23 June 2017, the second respondent’s sons Pablo Bettinsoli and Matias Bettinsoli were the only directors of Asbestos Removalist (Aust) Pty Ltd, of which the second respondent had previously been a director;
g)by 23 June 2017, the second respondent’s sons, Pablo Bettinsoli and Matias Bettinsoli, were the sole shareholders in Asbestos Removalist (Aust) Pty Ltd;
h)Asbestos Removalist (Aust) Pty Ltd entered into an enterprise agreement with the Applicant on behalf of its workforce to undertake asbestos removal work in 2018;
i)the registered address of Asbestos Removalist (Aust) Pty Ltd is 33 The Concord, Bundoora which was the registered address of the first respondent;
j)on 28 May 2018, the First Respondent entered into a sale agreement with a related party to sell certain assets that had remained in the company after had ceased to trade as noted in the liquidators report;
k)on 31 May 2018, the second respondent placed the first respondent into liquidation. The date of 31 May 2018 is just over twelve months after the date the second respondent’s sons ceased being directors of the first respondent;
l)the second respondent has attempted to place his own assets beyond legal reach. The second respondent has advised Mr Torres that he has “nothing under my name” and that he can “pay $10 a week” but at the same time indicating that the second respondent has access to funds to pay Mr Torres.”
57.The applicant contended that the second respondent had adopted a strategy to effectively transfer the business previously conducted by the first respondent to another entity previously controlled by him, but now formally controlled by his sons. This entity has the goodwill, business premises and equipment of first respondent. It was submitted that the second respondent removed himself as a director of Asbestos Removalist (Aust) Pty Ltd, to distance himself from the entity which now controls the business.
58.It was submitted that the inference should be drawn that the second respondent entered into a series of transactions with the first respondent, Asbestos Removalist (Aust) Pty Ltd and his sons, to avoid a pecuniary penalty and compensation to ensure the business continued to operate under another corporate entity.[22]
Corrective Action
[22] see Cowdroy J in FWO v Wongtas Pty Ltd and Ors (No 2) [2012] FCA 30 at 57-9.
59.The applicant’s written submissions addressed this consideration at paragraph [37] to [38].
60.The applicant submitted that the second respondent has not taken any corrective action in relation to any of the breaches. The matter was raised with the first and second respondents by the employees and the applicant. Proceedings were issued on 23 May 2017. No action has been taken to resolve the matter and the Liability Judgment recorded the true situation. The second respondent has failed to comply with the orders made by this Court on 1 April 2019 to reflect the findings made of underpayment in the Liability Judgment.
Co-operation with enforcement authorities
61.The applicant’s written submissions addressed this consideration at paragraph [39] to [41]. The applicant submitted the second respondent took no action when the issue was raised by the employees and the applicant. It was not until the applicant commenced proceedings that first and second respondents’ made any admissions to the applicant.
The need to ensure compliance with minimum standards;
62.The applicant’s written submissions addressed this consideration at paragraph [42] to [45]. The applicant noted that penalties for breach in the predecessor legislation were significantly increased in 2004. The applicant also noted that in Fair Work Ombudsman v Specialised Security Services Pty Ltd [2016] FCCA 1482 at [77]-[78], this Court referred to the public policy issues in deciding remedies to be applied to accessories in cases of breaches of industrial standards, as including requiring the prevention of people retaining a benefit resulting from their misconduct and encouraging them to take steps to ensure the corporation they control meets its statutory obligations as they arise.
63.The applicant submitted that the amounts involved here were very significant to the employees. The Court found in the Liability Judgment that the second respondent undertook a deliberate strategy to avoid the relevant obligations. It was submitted that the second respondent has pursued further deliberate strategies after the issuing of the proceedings to avoid the consequence of the conduct.
64.The applicant submitted that the second respondent has received significant financial benefit from the deliberate contraventions and that should attract the opprobrium by way of a significant penalty.
The need for specific and general deterrence.
65.The applicant’s written submissions addressed these considerations at paragraph [46] to [48].
66.The primary purpose of the imposition of a civil penalty is deterrence. The overarching importance of deterrence as a means of ensuring compliance with the statutorily ordained norms of behaviour, such as compliance with the FW Act, was confirmed by the High Court in Australian Building and Construction Commission v Construction, Forestry, Mining and Energy Union [2018] HCA 3; (2018) CLR 157 at [116] where the following statement was made by Keane, Nettle and Gordon JJ:
“As has been observed, the principle object of an order that a person pay a pecuniary penalty under s.546 is deterrence: specific deterrence of the contravener and, by his or her example, general deterrence of other would-be contraveners. According to orthodox sentencing conceptions as they apply to the imposition of civil pecuniary penalties, specific deterrence inheres in the sting or burden which the penalty imposes on the contraveners. Other things being equal, it is assumed that the greater the sting or burden the penalty, the more likely it will be that the contravener will seek to avoid the risk of subjection to further penalties and this the more likely it will be that the contravener is deterred from further contraventions; likewise, the more potent will be the example that the penalty sets for other would—be contraveners and therefore the greater the penalty’s general deterrent effect. Conversely, the less the sting or burden that a contravener is deterred from further contraventions and the less the general deterrent effect of the penalty. Ultimately, if a penalty is devoid of sting or burden, it may not have much, if any, specific or general deterrent effect, and so it will be unlikely, or at least less likely, to achieve the specific and general deterrent effect that are the raise d’etre of its imposition.” (emphasis added)
67.As noted earlier, the applicant submitted that the Court found in the Liability Judgment that the second respondent pursued a deliberate strategy of avoiding the relevant obligations. This strategy produced a large financial benefit personally to the second respondent. It was submitted that therefore it was necessary that the appropriate penalty for each contravention reflect an element of specific deterrence.
68.Furthermore it was submitted that the penalty arrived at should act as a deterrent to others who may be minded to flout the law and so the penalties for each contravention should contain an element of general deterrence and the penalties should be at a level such that the payment of a penalty is not regarded as simply the cost of doing business.
Totality principle
69.Having fixed an appropriate penalty for each contravention, the Court should take a final look at the aggregate penalty, to determine whether it is an appropriate response to the contravening conduct.
70.Essentially the totality principle requires the Court, once it has arrived, in light of the evaluation of the relevant factors, at an appropriate aggregate penalty to examine one final time the aggregate penalty to determine whether it is appropriate.[23] Whilst the penalty imposed must not be crushing or oppressive, it must nevertheless be proportionate to the seriousness of the conduct engaged in by the respondents. The application of the totality principle does not mean the penalties arrived at before its application must be reduced.
[23] Australian Ophthalmic Supplies Pty Ltd v Mc Alary-Smith [2008] FCAFC 8 at [27]-[28] per Gray J and [78] per Graham J.
71.In this case on the material before the Court there is no warrant to apply a further reduction at this stage.
Appropriate penalties
72.The maximum penalties have already been referred to and the position of the applicant on where (on a percentage basis) each of the grouped contraventions fall (which are accepted) is set out at Annexure B.
73.Therefore in relation to the second respondent it is appropriate to impose penalties for the contraventions as follows:
| Grouping | Penalty |
| Failing to pay Cl 25.1.12 of Award 2008-2011 (Asbestos Allowance) | $3,300.00 |
| Failing to pay Cl 29 of 2008-2011 Agreement (Superannuation) | $5,100.00 |
| Failing to pay Cl 2 of Appendix K of 2011-2015 Agreement (Asbestos & Consolidated Allowance) | $10,200.00 |
| Failing to pay Cl B of Appendix K of 2011-2015 Agreement (Wages) | $6,000.00 |
| Failing to pay Cl 24 of 2011-2015 Agreement (Fares & Travelling Allowance) | $4,000.00 |
| Failing to pay Cl 31 of 2011-2015 Agreement (Superannuation) | $10,200.00 |
| Failing to pay Appendix B of 2008-2011 Agreement (Wages) | $2,200.00 |
| Failing to pay Cl 22 of 2008-2011 Agreement (Fares & Travelling Allowance) | $2,200.00 |
| TOTAL: | $43,200.00 |
74.The applicant sought an order, that will be made, that the second respondent pay the civil penalties to the applicant pursuant to s.546(3) of the FW Act. That an order in such terms is usual is clear from principles explained by the Full Court in Sayed v Constructions, Forestry, Mining and Energy Union [2016] FCAFC 4.
Conclusion
75.The Court is directed by the relevant authorities to consider what is appropriate in all the circumstances of this case and in its discretion in relation to penalty is not fettered by a checklist of mandatory criteria and is satisfied the penalty for the whole of the contravening conduct is appropriate
76.Therefore for the reasons set out above I make the orders as set out at the beginning of these reasons for decision.
I certify that the preceding seventy-six (76) paragraphs are a true copy of the reasons for judgment of Judge O'Sullivan
Associate:
Date: 17 October 2019
ANNEXURE A: CHRONOLOGY
| Date | Event | Evidence |
| 2008–30 April 2012 | The Asbestos Removalist Pty Ltd and the CFMEU Building and Construction Industry Enterprise Agreement 2008–2011 applies. | Agreement, PCB 1126 (tendered at hearing, Ex A2) |
| 2010 | ||
| June 2010 | Mr Castillo commenced working for the First Respondent. | Castillo Affidavit, [3], PCB 573 at 574 |
| ‘A few months after’ Mr Castillo started work Notice | Mr Castillo asked the Second Respondent why he was not being paid correctly, and “what was going on” with his superannuation and Incolink. Mr Bettinsoli told him that there was not enough work for everyone and did not otherwise respond. | Castillo Affidavit, [6]–[7], PCB 573 at 574 |
| 2011 | ||
| July 2011 Notice | Mr Torres commenced working for the First Respondent. He was offered $28 per hour by the Second Respondent. Mr Torres informed Mr Bettinsoli that he is to be paid at least $32 per hour as he has a union ticket. He was told words to the effect of “OK, but don’t tell the other boys”. | Torres Affidavit, [3], PCB 288 at 289, |
| About a month after Mr Torres started work Notice | Mr Torres asked Mr Bettinsoli why he was not being paid superannuation, Coinvest, and Incolink. He is told by Mr Bettinsoli that he has to work for six months before getting paid superannuation, Coinvest, and Incolink. | Torres Affidavit, [6]–[7], PCB 288 at 289 |
| 2012 | ||
| 1 May 2012 | Commencement of the Asbestos Removalist Pty Ltd and the CFMEU Asbestos Removal Enterprise Agreement 2011–2015. Signed by Tiziano Bettinsoli. | Agreement, PCB 1040 (tendered at hearing, Ex A1), and see PCB 1084 |
| 2014 | ||
| 2014 Notice | Mr Torres informed Mr Bettinsoli that he had not received superannuation, Coinvest, or Incolink, and he was not being paid the correct asbestos allowance. Mr Bettinsoli told Mr Torres that he would fix it up. Mr Torres repeated his queries of Mr Bettinsoli “many times” afterwards. He was told that Mr Bettinsoli’s son was calculating everything and Mr Torres would be paid everything at the end of the year. He was not. | Torres Affidavit, [8]–[10], PCB 288 at 289 |
| November 2014 | Mr Jopling commenced working for the First Respondent. | Jopling Affidavit, [2] |
| ‘Early in my employment’ Notice | Mr Jopling (who started work in July 2015) asked Mr Bettinsoli why his payslips did not show Incolink or superannuation, and was told “a computer program needed to do the pays properly costs $10,000” and he was not going to pay it. | Jopling Affidavit, [7] |
| 5 December 2014 Notice | The CFMEU wrote to Mr Bettinsoli regarding non-payment of the all-purpose allowance per Appendix K of the enterprise agreement. | Referred to in the letter at PC-2 [Clark Affidavit], |
| 16 December 2014 Notice | The CFMEU and Mr Bettinsoli hold a meeting to discuss the non-payment of the all-purpose allowance per Appendix K of the enterprise agreement. | Referred to in the letter at PC-2 [Clark Affidavit], |
| 2015 | ||
| June 2015 | Mr Jopling ceased working at Asbestos Removalists. | Jopling Affidavit, [2] |
| 1 September 2015 Notice | The CFMEU wrote to Mr Bettinsoli inviting him to attend a meeting to discuss the dispute regarding non-payment of allowances. | Referred to in the letter at PC-2 [Clark Affidavit], |
| Some time after Notice | The CFMEU wrote to the Second Respondent stating that as a result of the continued failure of the First Respondent to remedy breaches of the Agreement, it would take legal action without further notice. | Letter at PC-2 [Clark Affidavit], |
| 23 October 2015 Notice | The CFMEU wrote to the Second Respondent stating that they were aware of recent contraventions to workplace laws, and requesting copies of employment and pay records. | Letter at PC-1 [Clark Affidavit], |
| November 2015 Notice | Mr Torres and Mr Castillo ceased working at Asbestos Removalists. | Torres Affidavit, [3], PCB 288 at 289, Castillo Affidavit, [3], PCB 573 at 574 |
| 2017 | ||
| 23 May 2017 | CFMMEU commenced proceedings against the Respondents. | Originating Application and SOC |
| 26 May 2017 | Mr Bettinsoli ceased to be a director and secretary of Asbestos Removalist (Aust) Pty Ltd. He also ceased to be a director of Asbestos Removalist (Vic) Pty Ltd (ACN 122 849 772) and Cuyen Pty Ltd. (He remained a director of the First Respondent, Asbestos Removalists Pty Ltd, until his bankruptcy.) | Company search, See Trustee’s Report, CB 961 at 980–981 Company search, |
| 26 May 2017 | Mr Bettinsoli’s sons, Pablo and Matias are removed as directors of the First Respondent. They are thereafter the sole directors of Asbestos Removalist (Aust). | Company search, SPCB 1235 at 1237 Company search, SPCB 1242–43 |
| 21 and 28 May 2017 | The principal place of business and registered office of Asbestos Removalist Pty Ltd is changed to 33 The Concord, Bundoora, which has been the principal place of business of Asbestos Removalist (Aust) Pty Ltd since 23 June 2015. | Company searches, SPCB 1235, |
| June 2017 | Mr Bettinsoli advised the liquidators of the First Respondent that the First Respondent ceased to trade in June 2017. | Liquidator’s First Report, PCB 447 at 449 See also FBPs to Second R’s defence at [3(g)]. |
| 18 September 2017 | Mr Bettinsoli, as director of the First Respondent, first spoke to the liquidators. | Liquidator’s First Report, PCB 447 at 455 |
| 2018 | ||
| 18 May 2018 | Mr Bettinsoli, his accountant (Mark Spittal) and his son (Pablo Bettinsoli) met with liquidators. | Liquidator’s First Report, PCB 447 at 455 |
| 28 May 2018 | The First Respondent entered into a sale agreement with a related party for certain assets that had remained in the company after it ceased to trade. | Liquidator’s First Report, PCB 447 at 451 |
| 31 May 2018 | Robert Erskine and Adrian Hunter are appointed liquidators of the First Respondent pursuant to a Creditor’s Voluntary Liquidation. Mr Bettinsoli advised the liquidators that the company had exhausted all funds and did not have the funds needed to continue to defend this proceeding. There are no secured creditors. There are two unsecured creditors: CW Spittal and Associates ($6,500) and Tiziano Bettinsoli ($5,939). The CFMEU is listed as a contingent creditor. | Liquidator’s First Report, PCB 447 PCB 447 at 449 PCB 447 at 476 |
| 15 June 2018 | Initial Notice to Creditors and First Report of liquidators of the First Respondent (Liquidator’s First Report). As stated above, the report noted that the liquidators investigations “had identified that on 28 May 2018, the company entered into a sale agreement with a related party to sell certain assets that had remained in the company after it had ceased to trade”. | Tendered by PC-3 [Clark Affidavit], PCB 447 and see page PCB 451 |
| 28 August 2018 | Letter and Statutory Report to Creditors by liquidators of the First Respondent (Liquidator’s Second Report). The report notes that “preliminary investigations … indicate that the company may have made some preferential payments” and that the liquidators “have written to the director seeking further information regarding certain payments made to related parties”. | SPCB 1265 SPCB 1265 at 1269 |
| 27 September 2018 | The Asbestos Removalist (Aust) Pty Ltd Enterprise Agreement 2018 is approved by the Fair Work Commission. It comes into effect from 4 October 2018 with a nominal expiry date of 26 September 2022. The Agreement is signed by Pablo Bettinsoli. | SPCB 1284 |
| 3 October 2018 | Mr Torres is contacted by Mr Bettinsoli, who told him that he “doesn’t want to pay anything to the Union and he can pay me; otherwise – what he say, he say, “I’m… I don’t… nothing under my name. And I can just pay $10 a week”. | Transcript P33.37–45 PCB 792 at 824 |
| 19 and 20 Nov 2018 | Hearing on liability. | Transcript: PCB 792 |
| 2019 | ||
| 8 March 2019 | Judgment on liability hearing. | Reasons at PCB 24 |
| 1 April 2019 | Compensation orders made against the Second Respondent by Judge O’Sullivan: 1–2: Pay Jimmy Castillo $15,474.22 in compensation plus $4059.94 in interest. 3–4: Pay Cesar Torres $33,777.74 in compensation plus $9,405.10 in interest. 5–6: Pay James Jopling $5,011.30 in compensation plus $1,085.02 in interest. | Orders at PCB 892 |
| 29 April 2019 | Due date for payment of compensation and interest. | Orders at PCB 892 |
| 29 April 2019 | Tracy Rothwell, solicitor for Mr Bettinsoli, spoke to Matthew Gollant, trustee in bankruptcy, “in relation to the financial situation of … Mr Bettinsoli.” The Trustee’s Report noted that Mr Bettinsoli was overseas during this time. | Trustee’s First Report, PCB 961 at 971 |
| 8 July 2019 | Mr Bettinsoli submitted his Debtor’s Petition and Statement of Affairs to AFSA. The First Report to Creditors by Matthew Gollant stated that Mr Bettinsoli “attributes the main cause of his insolvency [as] due to adverse legal action [this proceeding]” and that this proceeding is “the reasons for the Regulated Debtor’s financial difficulties with the estimated debt owing to the CFMEEU as $80,000”. | Trustee’s First Report, PCB 961 at 975–76 |
| 11 July 2019 | Mr Bettinsoli entered bankruptcy. Matthew Gollant of Courtney Jones and Associates is trustee. | Extract of records, |
| 6 August 2019 | Initial Information for Creditors of Tiziano Bettinsoli by trustee Matthew Gollant. Total debts owing is $304,500, of which: $80,000 is stated as owing to the CFMEU. $63,000 is stated as owing to Bettinsoli Family Trust, a related company. $152,000 is stated as owing to Westpac (under a guarantee provided for a loan facility held by his wife). | Trustee’s First Report, PCB 961 PCB 961 at 985 (and 978) |
ANNEXURE B: PROPOSED PENALTIES – ALTERNATIVE SUBMISSION
| Dec’n | Contravention | Employee/s | Nature of contravention | Maximum penalty | Proposed penalty |
| Contraventions of the 2008–2011 Agreement (Agreement in force until 30 April 2012) | |||||
| 1(a) | Failure to pay asbestos allowance (cl 25.1.12 of the Award as incorporated into the 2008–2011 Agreement) | Mr Castillo | Allowance not paid at all for 18 months: Sch [1].[24] For one month, allowance underpaid by $0.01 per hour, and not paid at all on overtime: Sch [2]. Total underpayment (including under the 2011–2015 Agreement): $2,830: SOC 18(a). | Max penalty for individual: 60 units. $110 x 60 = $6,600 | $3,300 |
| Mr Torres | Total underpayment (including under the 2011–2015 Agreement): $4,631.10: SOC 18(c). | ||||
| 1(b) | Failure to pay correct wages (App B of 2008–2011 Agreement) | Mr Torres | Underpayment of between $0.34 and $1.95 per hour; not paid overtime rates, for a period of nearly 8 months: Sch [16]. Total underpayment (including under the 2011–2015 Agreement): $6,932.69: SOC 26(c). | As above. | $2,200 |
| 1(c) | Failure to pay fares and travelling allowance (cl 22 of 2008–2011 Agreement) | Mr Torres | Allowance not paid at all for a period of four months: Sch [21]. Total underpayment including under the 2011–2015 Agreement): $2,088.02: SOC 34(c). | As above. | $2,200 |
| 1(d) | Failure to pay superannuation (cl 29 of the 2008–2011 Agreement) | Mr Castillo | Total underpayment (including under the 2011–2015 Agreement): $4,735: SOC 41(a). | As above. | $5,100 |
| Mr Torres | Total underpayment (including under the 2011–2015 Agreement): $9,446.81: SOC 41(c).[25] | ||||
| Total penalties for contraventions of terms of the 2008–2011 Agreement (maximum penalties for four contraventions = $26,400): | $12,800 | ||||
[24]References to ‘Sch’ in this table are references to the Schedule to the judgment of Hartnett J.
[25]The amount claimed in the Statement of Claim of $8,592.40 was corrected at the hearing, without objection: see T6.6–T7.8.
| Dec’n | Contravention | Employees | Nature of contravention | Maximum penalty | Appropriate penalty |
| Contraventions of the 2011–2015 Agreement (Agreement in force from 1 May 2012) | |||||
| 1(e) | Failure to pay asbestos allowance (cl 2 of App K of the 2011–2015 Agreement) | Mr Castillo | For a period of nearly 2.5 years, allowance underpaid by between $0.45 and $0.65 per hour; not paid for overtime; sometimes not paid on RDOs; sometimes not paid at all: Sch [3], [4], [5]. | For the first five months of this period, max penalty was $6,600 | $10,200 |
| Thereafter, the penalty unit increased to $170 and the maximum penalty was $10,200. | |||||
| Allowance paid at correct rate for a period of two months, but not paid on overtime or RDOs; not always paid at all: Sch [6] | As above. | ||||
| For a period of eight months, allowance underpaid by $0.15 per hour; not paid on overtime or RDOs; not always paid at all: Sch [7]. Total underpayment (including under the 2011–2015 Agreement: $2,830): SOC 18(a). | For 3.5 months, as above. | ||||
| For the remaining 4.5 months, the penalty unit increased to was $180 and the max penalty was $10,800 | |||||
| Mr Torres | Total underpayment (including under the 2008–2011 Agreement): $4,631.10: SOC 18(c). | For the majority of the period, max penalty was $10,200. | |||
| Mr Jopling | Total underpayment: $832.60: SOC 18(b). | ||||
| Failure to pay consolidated allowance (cl 2 of App K of the 2011–2015 Agreement) | Mr Castillo | For nearly 2.5 years, allowance underpaid between $0.70 and $1.95 per hour; not paid on overtime; sometimes not paid at all, or on RDOs: Sch [9], [10], [11]. | For the first five months of this period, max penalty was $6,600. | ||
| Thereafter, the penalty unit increased to $170 and the maximum penalty was $10,200. | |||||
| For 11 months, allowance paid at or slightly above ($0.25) correct rate, but not paid on overtime or RDOs; sometimes not paid at all: Sch [12], [13], [14] Total underpayment: $7,019.11: | As above. | ||||
| For the last 2 months, the penalty unit increased to was $180 and the max penalty was $10,800 | |||||
| Mr Torres | Total underpayment: $10,679.12: SOC 20(f). | For the majority of the period, max penalty was $10,200. | |||
| Mr Jopling | Total underpayment: $1,565: SOC 20(e). | ||||
| 1(f) | Failure to pay correct wages (cl B of Appendix K of 2011–2015 Agreement) | Mr Castillo | Total underpayment: $497.51: SOC 26(a). | For the majority of the period, max penalty was $10,200. | $6,000 |
| Mr Torres | For 18.5 months, underpayment of between $0.16 and $2.84 per hour; not paid or underpaid overtime: Total underpayment (including under the 2008–2011 Agreement): $6,932.69: SOC 26(c). | Maximum penalty = $10,200. | |||
| Mr Jopling | Total underpayment: $347.75: SOC 26(b). | For the majority of the period, max penalty was $10,200. | |||
| 1(g) | Failure to pay fares and travelling allowance (cl 24 of 2011–2015 Agreement) | Mr Castillo | Total underpayment: $505.95: SOC 34(a). | For the majority of the period, max penalty was $10,200. | $4,000 |
| Mr Torres | For a period of 1.5 years, underpayment of between $5.66 per day (for one week) and otherwise between $2.15 and $0.35 per day; some days not paid at all: Sch [24], [25], [26]. | Maximum penalty = $10,200. | |||
| For a period of 7.5 months, correct rate paid, but not paid for each day he was entitled to receive it: Sch [26]. Total underpayment including under the 2011–2015 Agreement): $2,088.02: SOC 34(c). | For the first 4 months, the max penalty was $10,200. | ||||
| For the last 3.5 months, the max penalty was $10,800.0 | |||||
| Mr Jopling | Total underpayment: $505.95: SOC 34(a). | For the majority of the period, max penalty was $10,200. | |||
| 1(h) | Failure to pay superannuation (cl 31 of 2011–2015 Agreement) | Mr Castillo | Underpayment of $3,690.07 in superannuation for the financial year ending 30 June 2015: Sch [37]. Total underpayment (including under the 2011–2015 Agreement): $4,735: SOC 41(a). | Maximum penalty = $10,200. | $10,200 |
| Mr Torres | Underpayment of $6,061.81 in superannuation for the financial year ending 30 June 2014: Sch [28]–[29]. | As above, except for last 4 months of this period, when the max penalty increased to $10,800 | |||
| Underpayment of $2,500 in superannuation for the financial year ending 30 June 2015: Sch [30]–[31]. | |||||
| Underpayment of $888 in superannuation for the period 1 July 2015 to 30 November 2015: Sch [32]–[33]. Total underpayment (including under the 2008–2011Agreement): $8,592.40: SOC 41(c). | |||||
| Mr Jopling | Underpayment of $1,575 in superannuation for the period 3 Nov to 30 June 2015: Sch [35]. Underpayment of $185 for the first week of July 2015: Sch [36]. | Maximum penalty = $10,200. | |||
| Total penalties for contraventions of terms of the 2011–2015 Agreement (average maximum penalties for four contraventions = $40,800): | $30,400 | ||||
| Total maximum penalties for eight contraventions: $87,200 | $43,200 | ||||
Key Legal Topics
Areas of Law
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Employment Law
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Insolvency
Legal Concepts
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Penalty
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Remedies
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