Fair Work Ombudsman v Ansa Finance Pty Ltd (No 2)

[2024] FedCFamC2G 95

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 2)

Fair Work Ombudsman v Ansa Finance Pty Ltd (No 2) [2024] FedCFamC2G 95

File number:

MLG 2773 of 2021

Judgment of:

JUDGE FORBES

Date of judgment:

13 February 2024 

Catchwords:

FAIR WORK -  penalties – failure to comply with compliance notices issued by Ombudsman – failure to provide payslips – consideration of relevant principles including objective of deterrence - whether compliance notice contraventions should be grouped – whether post-contravention conduct can be taken into account in assessing penalties – penalties ordered

Legislation:

Crimes Act 2009 (Cth) s 4AA

Fair Work Act 1975 (Cth) s 356, 536, 539, 545, 546, 550, 682 716, 717

Cases cited:

Australian Building and Construction Commission v Construction Forestry Mining and Energy Union (No. 2) (2010) 199 IR 373

Australian Building and Construction Commission v Construction Forestry Mining and Energy Union (No. 2) [2011] FCA 1518

Australian Building and Construction Commissioner v Pattinson [2022] HCA 13

Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8

Commonwealth v Director, Fair Work Building Industry Inspectorate [2015] HCA 46

Fair Work Ombudsman v ACN 146 435 118 Pty Ltd & Anor (No. 2) [2013] FCCA 1270

Fair Work Ombudsman v ANSA Finance Pty Ltd [2022] FedCFamC2G 833

Fair Work Ombudsman v Big Daddy's Pty Ltd [2022] FedCFamC2G 786

Fair Work Ombudsman v NSH North Pty Ltd trading as New Shanghai Charlestown  [2017] 275 IR 148

Fair Work Ombudsman v Offshore Marine Services Pty Ltd [2021] FCA 49

Fair Work Ombudsman v Taj Palace Tandoori Indian Restaurant Pty Ltd & Anor [2012] FMCA 258

Fair Work Ombudsman v Tester [2021] FCCA 771

Fair Work Ombudsman v Theill Pipelines Pty Ltd & Anor [2021] FCCA 492

Jordan v Mornington Inn Pty Ltd [2007] FCA 1384

Kelly v Fitzpatrick [2007] FCA 1080

Royer v Western Australia [2009] WASCA 139

Temple v Powell (2008) 169 FCR 169

The Queen v McInerney (1986) 42 SASR 111

Trade Practices Commission v Bata Shoe Company of Australia Pty Ltd [1980] FCA 47

Trade Practices Commission v CSR Ltd (1991) ATPR 41-076

Division:

Division 2 General Federal Law

Number of paragraphs:

116

Date of hearing:

22 March 2023

Place:

Melbourne

Solicitor for the Applicant:

HWL Ebsworth Lawyers

Respondents:

Mr Fuoco

ORDERS

MLG 2773 of 2021

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)

BETWEEN:

FAIR WORK OMBUDSMAN

Applicant

AND:

ANSA FINANCE PTY LTD

First Respondent

JOSHUA FUOCO

Second Respondent

ORDER MADE BY:	JUDGE FORBES
DATE OF ORDER:	13 FEBRUARY 2024

THE COURT ORDERS THAT:

1.Pursuant to section 546(1) of the Fair Work Act 2009 (Cth) (FW Act):

(a)the First Respondent pay a pecuniary penalty of $58,275.00 to the Commonwealth for the contraventions declared in paragraph 1 of the 14 October 2022 Orders, within 28 days of the date of this order; and

(b)the Second Respondent pay a pecuniary penalty of $11,655.00 to the Commonwealth for the contraventions declared in paragraph 2 of the 14 October 2022 Orders, within 28 days of the date of this order.

2.Pursuant to section 546(3)(a) of the FW Act, any pecuniary penalties ordered to be paid by the First and Second Respondent be paid into the Consolidated Revenue Fund of the Commonwealth within 28 days of the date of this order.

3.The Applicant have liberty to apply on seven days’ notice in the events that any of the preceding orders are not complied with.

4.The parties have liberty to make any application in relation to costs within 28 days of these orders.

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 FORBES

INTRODUCTION

1. The Fair Work Ombudsman (the Ombudsman) seeks the imposition of pecuniary penalties against the first respondent, Ansa Finance Pty Ltd, and the second respondent, Mr Joshua Fuoco, pursuant to the declarations made by this Court on 14 October 2022 (the October Orders).

2. In this proceeding, the Ombudsman alleged that the first respondent had contravened sections 716(5) and s 536(1) of the Fair Work Act 2009 (Cth) (the FW Act) for its failure to comply with four separate compliance notices (collectively the Compliance Notices) and for its failure to issue pay slips to one of the employees. The Ombudsman further alleged that the second respondent was involved in these alleged contraventions pursuant to s 550(1) of the FW Act.

3. In October 2022, for the reasons published in Fair Work Ombudsman v ANSA Finance Pty Ltd [2022] FedCFamC2G 833 (the liability decision), I found that the first respondent had contravened provisions of the FW Act as alleged.

4. The circumstances giving rise to the respondents’ declared contraventions were summarised in the liability decision[1], including the evidence of the alleged contraventions[2] and the arguments that were advanced by Mr Fuoco for the respondents’ ultimately unsuccessful defence[3]. 

   [1] Fair Work Ombudsman v ANSA Finance Pty Ltd [2022] FedCFamC2G 833 (liability judgment) [2]-[10] and [15]-[22]

   [2] Liability judgment [35]-[100]

   [3] Liability judgment [101]-[121]

5. The main thrust of the respondents’ defence was that the first respondent's failure to comply with the Compliance Notices was not a contravention of the FW Act because the company had a “reasonable excuse” pursuant to section 716(6) of the FW Act. The respondents submitted that the reasonable excuses for non-compliance, included:

   (1)Mr Fuoco’s health issues which impacted his capacity to perform work between October 2020 and 17 June 2021;

   (2)the company’s financial incapacity and the significant downturn in revenue resulting from the COVID-19 pandemic;

   (3)that Mr Fuoco claimed not to have been made aware of the right to seek a review of the Compliance Notices pursuant section 717 of the FW Act; and

   (4)that two of the employees in respect of whom Compliance Notices had been issued had not met their “performance of work” obligations under the FW Act.

6. The Court ultimately held that the first respondent did not have a reasonable excuse for its non-compliance with the notices. Accordingly, I made the following declarations:

   “1.       The First Respondent (Ansa Finance) contravened sub-sections:

   (a)716(5) of the Fair Work Act 2009 (Cth) (FW Act), by failing to comply with the Chawla Compliance Notice, the Mantzioukas Compliance Notice, the White Compliance Notice and the Jern Compliance Notice; and

   (b)536(1) of the FW Act, by failing to give pay slips to Mr Mantzioukas within one working day of payments being made to him in relation to the performance of work.

   2.That the Second Respondent was involved, within the meaning of section 550(2) of the FW Act, in the contraventions by Ansa Finance of section 716(5) and section 536(1) of the FW Act referred to in declaration 1 above.”

7. The Court also ordered, pursuant to section 545(1) of the FW Act, that the first respondent was to take the steps required to comply with the Compliance Notices within 28 days of the reasons being delivered.

8. There is no need to further rehearse the background within these reasons, except as necessary to explain why I have determined that penalties should be imposed for the respondents’ contraventions.

   PENALTY PROCEEDINGS

9. Following the delivery of the liability judgment, the matter was listed for penalty hearing on 22 March 2023.

10. On 7 November 2022, orders were made by consent which, inter alia, required the applicant and respondents to file and serve affidavit evidence and written submission in respect of the imposition of penalty.

11. In February 2023, the Ombudsman requested that a one week extension be granted for the filing of its materials. The respondents were amenable to this extension request, and consent orders were published on 14 February 2023 extending the timetable for filing (February Orders).

12. On 22 February 2023, the Ombudsman filed its written submission on penalty as well as a List of Authorities.

13. By the February Orders, the respondents were required to file and serve any affidavit evidence and written submissions in respect to penalty by no later than 8 March 2023.

    PENALTY HEARING

14. On 22 March 2023 the matter was listed for a penalty hearing.

15. Mr Adams, a solicitor, appeared on behalf of the Ombudsman. Mr Fuoco was not present in Court at the commencement of the hearing.  Mr Adams indicated to the Court that there had been no recent communication from the respondents, despite emailing Mr Fuoco to see whether he objected to the court book or an additional affidavit the Ombudsman sought to rely on.

16. I caused the first and second respondents to be called outside the Court room. My associate reported that there was no response to the call, and therefore, no appearance by the first or second respondent.

17. Notwithstanding the respondents' non-appearance, I permitted the matter to proceed[4].

    [4] Rule 13.06(1)(e) of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021

18. In support of its application for the imposition of pecuniary penalties against the respondents, the Ombudsman relied on the following pleadings and evidence:

    (1)Originating Application and Statement of Claim filed on 29 October 2021;

    (2)Affidavit of Christina Filomena Candiloro filed on 18 March 2022;

    (3)Affidavit of Linda Tran filed on 5 April 2022 (First Tran Affidavit);

    (4)Affidavit of Christine Cox filed on 6 April 2022;

    (5)Transcript of the liability hearing for this proceeding; and

    (6)Affidavit of Linda Tran affirmed on 22 February 2023 (Second Tran Affidavit).

19. The Ombudsman’s also relied upon its written outline of submissions on penalty (Ombudsman’s Submission on Penalty), which Mr Adams developed in his oral submissions at the hearing. I have read and considered each of these documents in reaching my decision.

20. As at the date of the penalty hearing, neither the first or second respondents had filed any submission or evidence in relation to the imposition of penalty. Further, despite my chambers notifying the respondents of the upcoming hearing, the Court did not receive any correspondence from Mr Fuoco.

21. On 29 March 2023, after the penalty hearing, the Ombudsman filed a Supplementary Submission Regarding Penalty, citing relevant authorities and addressing the specific question of whether conduct by the respondents which occurred after the established contravention can be taken into account in determining penalties in the instant case. This issue is explored later in these reasons.

    STATUTORY FRAMEWORK

22. Pursuant to sub-section 546(1) of the FW Act, this Court has power to order a person to pay a pecuniary penalty in circumstances where it is satisfied that the person has contravened a civil remedy provision[5].

    [5] Fair Work Act 2009 (Cth) (FW Act) s 539(1)

23. Pursuant to the table in sub-section 539(2) of the FW Act, both ss 536(1) and 716(5) are civil remedy provisions.

24. A contravention of sub-section 716(5) attracts a maximum penalty of 30 penalty units for an individual. Pursuant to sub-section 546(2) the penalty for a corporate respondent must be not more than five times the maximum for an individual. For breaches occurring between 1 July 2020 and 1 July 2023, the value of a penalty unit is $222[6]. The maximum penalties for contraventions of sub-section 716(5) is therefore $6,660.00 for an individual and $33,300 for a corporate respondent.

    [6] Crimes Act 2009 (Cth) s 4AA

25. The maximum penalty amount for a non-serious contravention of section 536(3) is 60 penalty units, which is $13,320.00 for an individual and $66,600.00 for a body cooperate.

26. In its Written Penalty Submission, the Ombudsman submits that the following penalties are appropriate in the current case.

First Respondent – Ansa Finance Pty Ltd
Contravention	Maximum Penalty	Recommended penalty range of maximum	Recommended penalty amount
s.716(5) - Chawla Compliance Notice	$33,300.00	75%-85%	$24,975.00-$28,305.00
s.716(5) – Mantzioukas Compliance Notice	$33,300.00	75%-85%	$24,975.00-$28,305.00
s.716(5) – White Compliance Notice	$33,300.00	75%-85%	$24,975.00-$28,305.00
s.716(5) – Jern Compliance Notice	$33,300.00	75%-85%	$24,975.00-$28,305.00
s.536(3) - Mantzioukas pay slips	$66,600.00	60%-70%	$39,960.00-$46,620.00
TOTAL:	$199,800.00	70% -80%	$139,860.00 - $156,840.00
Second Respondent –  Joshua Fuoco
Contravention	Maximum Penalty	Recommended penalty range of maximum	Recommended penalty amount
s.716(5) - Chawla Compliance Notice	$6,660.00	75%-85%	$4,995.00-$5,661.00
s.716(5) – Mantzioukas Compliance Notice	$6,660.00	75%-85%	$4,995.00-$5,661.00
s.716(5) – WhiteCompliance Notice	$6,660.00	75%-85%	$4,995.00-$5,661.00
s.716(5) – JernCompliance Notice	$6,660.00	75%-85%	$4,995.00-$5,661.00
s.536(3) - Mantzioukaspayslips	$13,320.00	60%-70%	$7,992.00-$9,324.00
TOTAL:	$39,960.00	70% -80%	$27,960.00 - $31,968.00

APPLICABLE LEGAL PRINCIPLES

1. The approach of the Court in determining penalties is well settled.  The Court has a broad discretion to assess the appropriate penalty.  In Fair Work Ombudsman v NSH North Pty Ltd trading as New Shanghai Charlestown[7], Bromwich J endorsed the following approach:

   (1)identify the separate contraventions involved - each contravention of each separate obligation in the FW Act is a separate contravention;

   (2)consider whether any of the contraventions arising from the above constitute a single course of conduct within the meaning of section 557(1) of the FW Act;

   (3)consider the extent to which two or more of the contraventions have common elements - the penalties imposed should be an appropriate response to the conduct of the respondent;

   (4)consider the appropriate penalty for each contravention and, if relevant, each group of contraventions; and

   (5)finally, assess whether the overall penalty is an appropriate and proportionate response to the conduct as a whole which led to the contraventions.  This is the application of the “totality principle”.

   [7] [2017] 275 IR 148 at [36]

2. It is well established that the primary purpose of civil penalty provisions is to promote the public interest in compliance[8]. This purpose was recently reinforced by the High Court of Australia in Australian Building and Construction Commissioner v Pattinson (‘Pattinson’)[9], where the majority stated that the purpose of the civil remedy regime in the FW Act is the promotion of the public interest in compliance with provisions of the FW Act by way of deterrence of further contravention[10].

   [8] Trade Practices Commission v CSR Ltd (1991) ATPR 41-076 (‘CSR’) at [42]; Commonwealth v Director, Fair Work Building Industry Inspectorate [2015] HCA 46 at [55] (per French CJ, Kiefel, Bell, Nettle and Gordon JJ)

   [9] Australian Building and Construction Commissioner v Pattinson [2022] HCA 13 at [9] (‘Pattinson’)

   [10] Pattinson at [71]

3. Reaching for that purpose involves putting a price on a contravention which is fairly and reasonably appropriate. A penalty should carry a sufficient sting to ensure that is not seen as just the cost of doing business. Compliance with the law should be encouraged by ensuring that contraventions are viewed, by contravenors and others, as an economically irrational choice[11].

   [11] Pattinson at [66]

4. Fundamental to the Court’s task is an assessment of the gravity and seriousness of the offending which it is called upon to penalise, having regard to all relevant factual circumstances. The considerations deemed relevant to this task are well known and frequently cited[12]. They include: 

   [12] CSR at [42]; see also Pattinson at [18]; Kelly v Fitzpatrick [2007] FCA 1080 at [14]

   ·the nature and extent of the conduct which led to the breach;

   ·the circumstances in which the conduct took place;

   ·the nature and extent of any loss or damage sustained as a result of the breach;

   ·whether there has been similar previous conduct by the respondent;

   ·whether the breach was properly distinct or arose out of one course of conduct;

   ·the size of the business enterprise involved;

   ·whether or not the breach was deliberate;

   ·the involvement of senior management in the breach;

   ·whether the party committing the breach has shown contrition;

   ·whether the party committing the breach has taken corrective action;

   ·whether the party committing the breach has cooperated with enforcement authorities;

   ·the need to ensure compliance with minimum standard by provision of an effective means for investigation and enforcement of employee entitlements; and

   ·the need for specific and general deterrence.

5. While this extensive list is well-settled, it is not to be interpreted by the Court as a “rigid catalogue of matters for attention”[13]. In Pattinson, the High Court reiterated that this list of possible relevant considerations ought not to be treated as a checklist. There is no specific order in which these matters should be considered. The Court may take into consideration matters relevant to both the character of the contravening conduct and of the contravenor[14]. The Court's task is and remains the determination of what penalty is most appropriate given all of the relevant circumstances of the case[15].

   [13] Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8 [91]

   [14] Pattinson at [19]

   [15] Pattinson at [68]

   CONSIDERATION

6. Ansa Finance has been found to contravened sub-section 716(5) of the FW Act for failing to comply with four compliance notices issued by the Ombudsman. Ansa has also been found to have contravened the requirement in s 536(3) that it provide payslips to one of its former employees. Mr Fuoco has been found to have been involved in each of Ansa’s contraventions and pursuant to s 550 of the FW Act is deemed to be a contravenor himself. These are the established contraventions.

   Deterrence

7. The Court must impose a penalty that accurately and appropriately reflects the need for both general and specific deterrence.

   General deterrence

8. General deterrence promotes a message to the wider community and like-minded individuals that the contravening conduct is unacceptable. The Ombudsman made the following uncontroversial submissions on the issue of general deterrence (excluding footnotes), specifically directed to the contraventions in this case: 

   “27.The efficacy of statutory notices such as compliance notices will be hindered if recipients perceive that a failure to comply carries no meaningful consequences. Given the importance of the power to issue a compliance notice as a tool of Fair Work Inspectors, and that compliance with such notices avoids the need for litigation or the imposition of any penalties, penalties for non-compliance should be set at a level which demonstrates there are serious consequences for failing to comply with a compliance notice. In doing so, the Court will deter other parties from failing to comply with compliance notices.

   28. The Courts have also recognised that non-provision of pay slips has the effect of denying employees the benefit of understanding how they were paid and assessing their entitlements for work performed. Employers who fail to provide pay slips disempower employees, impede oversight and regulation, and intentionally or otherwise create a system within which breaches of industrial laws can be easily perpetrated. For these reasons, the Court should impose a penalty at a meaningful level to promote compliance with the minimum standards to which all award-covered employees are entitled.”

1. I accept the Ombudsman’s submission that the Fair Work Inspector’s (FWI) power to issue compliance notices is an important mechanism aimed at ensuring employers observe and discharge obligations imposed by the FW Act. Further, where proper records are kept as required by the legislation, payslips are provided and wages are properly calculated and paid, there should be no need for compliance notices. Where compliance notices are issued and an employer is afforded an opportunity to correct shortcomings, the notices should be met with compliance. Notices cannot be ignored.

   Specific deterrence

2. Specific deterrence seeks to ensure that a particular contravener does not part take in the same or similar contravening conduct in the future. In his opening address, Mr Adams highlighted that specific deterrence was a key focus of the Ombudsman’s submission on penalty in this case.

3. In its written submissions, the Ombudsman emphasised a particular need to specifically deter the respondents from engaging in the same contravening conduct in the future, for the following reasons:[16]

   (1)Ansa Finance is still registered;

   (2)the respondents have demonstrated a repeated disregard for their obligations under the FW Act by failing to comply with the Compliance Notices, the October Orders requiring compliance with those notices, and their pay slip obligations;

   (3)Mr Fuoco is an individual with significant managerial responsibility at Ansa Finance. He is currently listed as the company secretary;

   (4)as the manager of Ansa Finance, Mr Fuoco may continue to have responsibility for employing employees or overseeing employees’ entitlements in the future and complying with minimum obligations;

   (5)the respondents have been wholly uncooperative with the Ombudsman;

   (6)since initiating this proceeding, the Ombudsman has commenced other proceedings against Ansa Finance and Mr Fuoco for similar contraventions of the FW Act;

   (7)the respondents' “wilful recidivism and intentional disobedience of the law” should weigh strongly in favour of a higher penalty; and

   (8)the Ombudsman is continuing to receive requests for assistance by former employees of Ansa Finance and another company, which Mr Fuoco purports to have authority to represent (AFSL Group Pty Ltd), which relate to the same or similar entitlements that are the subject of the Compliances Notices in these proceedings;

   [16] Ombudsman’s Submissions on Penalty at [30]

4. During oral submissions, Mr Adams expanded on these submissions and pointed to evidence in the Second Tran Affidavit, where the inspector gave evidence about Mr Fuoco’s involvement in the management of a second employing entity, AFSL Group[17], against which complaints had also been made.

   [17] Affidavit of Linda Tran affirmed on 22 February 2023 at [7]

5. The Second Tran Affidavit annexed email correspondence between Mr Fuoco and a FWI from October 2022, where Mr Fuoco stated that he had lodged a formal complaint with the Commonwealth Ombudsman “about the treatment of Ansa Finance, AFSL Group and [himself] by FWC and FWO”.  Mr Adams submitted that in circumstances where there had been no impropriety on the part of the Ombudsman, Mr Fuoco’s complaint reveals the brazen and aggressive attitude that Mr Fuoco had shown towards the overall compliance investigation process.  Mr Adams clarified that his submission did not seek to penalise Mr Fuoco for using the complaint avenues available to him, but rather that it should be seen in the context of a course of evasive conduct employed by Mr Fuoco and a contemptuous attitude towards the regulator.

   Relevance of subsequent complaints and proceedings commenced after the established contraventions

6. I digress briefly to discuss an issue which arose during the course of the Ombudsman’s submissions and about which the Ombudsman was invited to provide a supplementary written submission.

7. The Ombudsman contended that, in determining civil penalties for one or more established contraventions, the Court may, when assessing the need for specific deterrence, have regard to:

   (1)proceedings that have been commenced against the same respondent or respondents after the established contraventions, for similar alleged contraventions which have not yet been judicially determined; and/or

   (2)complaints that have been made or investigations that have been initiated against the same respondent or respondents, after the established contraventions, pertaining to similar alleged breaches, but in relation to which proceedings have not been commenced.

8. The Ombudsman submitted that the respondents have repeatedly failed to comply with the same obligations (section 716(5) of the FW Act) and have done so in full knowledge that a failure to comply might result in litigation. Mr Adams alluded to subsequent proceedings that had been filed in this Court by the Ombudsman in July 2022 against the respondents for a similar compliance notice contravention (Second Ansa Proceeding).

9. The Second Ansa Proceedings related to an alleged failure by the respondents to comply with a compliance notice issued on 4 February 2022. At that time, these proceedings had been commenced (29 October 2021), although liability was yet to be heard (12 September 2022) or determined (14 October 2022). At the time of hearing this application for penalties  in respect of the contraventions established in the liability judgment (22 March 2023), the outcome of the Second Ansa Proceeding remained undecided on all questions.

10. It was submitted that across his multiple interactions with the Ombudsman, Mr Fuoco had not become any less brazen in his attitude to compliance. The Ombudsman submitted that evidence of what appears to be an ongoing pattern of conduct by Mr Fuoco should inform the requirement for specific deterrence and heighten the need for a corrective message to be specifically aimed at him.

11. The Court clearly has power to impose penalties for the contraventions which have been established in this proceeding. Although any prior contraventions and conduct by the respondents can unquestionably inform the assessment of penalty to be imposed in the instant case, Mr Adams conceded that there was no clear guidance on how or whether the Court could or should take into account evidence of subsequent conduct.

12. In its supplementary submission, the Ombudsman appears to accept that subsequent proceedings involving the same party or parties alleging similar conduct should not be treated as aggravating the established contravention which is being assessed for penalty. Normally, only conduct preceding that in question is taken into account in fixing penalties[18]. Nor does the Ombudsman submit that the quantum of penalty in the established case should take into account a particular alleged contravention in a subsequent case, conceding that this would risk a ‘double punishment’.

    [18] Temple v Powell (2008) 169 FCR 169; see also Australian Building and Construction Commission v Construction Forestry Mining and Energy Union (No. 2) (2010) 199 IR 373 and Australian Building and Construction Commission v Construction Forestry Mining and Energy Union (No. 2) [2011] FCA 1518

13. Rather, the Ombudsman submitted that in assessing penalty in the current proceeding the Court need not ‘quarantine’ evidence, particularly the email correspondence contained within the annexures to the Second Tran Affidavit, where there is a degree of commonality or overlap between the various investigations which have been initiated by the Ombudsman into the respondents or other companies associated with Mr Fuoco. For example, in considering the respondents’ ongoing failure to comply with the October Orders which accompanied the liability judgment, the Ombudsman submitted that the Court should take into account the respondents’ ongoing lack of cooperation in other contemporaneous investigations.

14. The Ombudsman submits that while evidence of a subsequent offence cannot justify a Court imposing a higher penalty than the established convention intrinsically merits, such evidence might lead the Court to conclude that any leniency in the instant case would be misplaced[19].

    [19] The Queen v McInerney (1986) 42 SASR 111

15. In Fair Work Ombudsman v Barry Scott Distributors Pty Ltd [2014] FCCA 1587, Judge Altobelli (as his Honour then was) found that there was a particularly high need for specific deterrence in a case where the Ombudsman continued to receive complaints of underpayment after the respondent had been put squarely on notice that it had contravened the FW Act. His Honour said in those circumstances the respondent had continued to engage in similar conduct, giving rise to an imperative for a strong message.

16. However, in Fair Work Ombudsman v ACN 146 435 118 Pty Ltd & Anor (No. 2) [2013] FCCA 1270 (‘ACN 146 435 118’), Judge Lucev cautioned at [58]:

    “[58][…] The Court must be careful not to impose a sentence in respect of matters which have not, and may not, ever result in contravention proceedings, and which may not, in any event, constitute a contravention of the statute. Worse than that, it ought not contribute to an inappropriate over-zealousness on the part of the regulator if courts were to consider prior involvement with the regulator as a significant sentencing factor, except as it relates to the circumstances of the particular contraventions before the Court.”

17. The Ombudsman also submits that the relevance of post-contravention conduct is countenanced by the well-settled list of factors in Trade Practices Commission v CSR Ltd (1991) ATPR 41-076[20] which includes “corrective measures in response to an alleged contravention”. By extension, the Ombudsman submits that if corrective measures or mitigation are to be taken into account in assessing penalty, then why not also conduct which evidences ongoing non-compliance?

    [20] CSR

18. In my view, as a matter of principle, the Court should not venture into assessing penalty for an established contravention by reference to evidence of alleged but unproven subsequent contraventions, including those which are the subject of current proceedings in this Court.

19. It is very easy for evidence of later alleged contraventions, which have not been subject of contest and determination, to lead the Court into error. As Judge Lucev wisely cautioned in ACN 146 435 118, “[t]he Court must be careful not to impose a sentence in respect of matters which have not, and may not, ever result in contravention proceedings, and which may not, in any event, constitute a contravention of the statute”.

20. In my view it is for good reason that, normally, only conduct preceding that in question will be taken into account in assessing penalty. The risk of double-punishment in penalty proceedings for the subsequent conduct must be considered. Moreover, as Judge Lucev observed, the later alleged conduct may not manifest in a prosecution or it might be the subject of a legitimate defence, which is currently not apparent. As a matter of principle it would be unfair to impose upon a respondent a sanction which is greater than warranted on the established contravention.

21. Of course, if the Ombudsman brings a prosecution in relation to the later conduct, and is successful, it might seek a higher order penalty on that occasion by reason of the respondents’ prior offending. No doubt in seeking a penalty for later contraventions the Ombudsman will draw the Court’s attention to the state of the respondent’s knowledge at the time, which might include prior investigations, proceedings and judgments.  The requirement for specific deterrence to address the ongoing pattern of conduct will be determined on the evidence at the time.

22. That said, I accept the Ombudsman’s submission that evidence of the respondents' ongoing dealings and interactions with the Ombudsman relating to other alleged contraventions may be relevant to assessing “whether the company has shown a disposition to cooperate with the authorities responsible for the enforcement of the Act in relation to the [present] contravention[s]”[21]. However, the extent to which such evidence can inform that question and the issue of the need for specific deterrence will be limited. The respondents’ conduct in relation to other investigations may have many explanations, as yet untested. It is not a matter to which I would attach great weight.

    [21] CSR at [42] (French J).

    Nature, circumstances and deliberateness of the contravening conduct

23. The details of the established contraventions are extensively canvassed in the liability judgment. I have taken the background facts, the evidence and my findings into account in forming a view about the objective seriousness of the respondents’ conduct.

24. Consistent with my findings in the liability judgment, the Ombudsman offered the following written submissions to explain the circumstances of the Compliance Notice and payslip contraventions, (footnotes excluded):

    “Compliance Notice contraventions

    33.The contraventions of section 716(5) of the FW Act took place against a background where:

    (a)the Respondents were on notice from 21 January 2021,  31 March 2021, 14 May 2021, and 29 June 2021,  respectively:

    (i)of the due date for compliance with the Compliance Notices;

    (ii)that a failure to comply with the Compliance Notices may lead to the FWO commencing proceedings seeking civil penalties and orders for compliance;

    (b)Ansa Finance did not have a reasonable excuse for non-compliance with the Compliance Notices;

    (c)Ansa Finance did not take all the steps required to comply with:

    (i)the Chawla Compliance Notice by 24 February 2021 and 3 March 2021;

    (ii)the Mantzioukas Compliance Notice by 3 May 2021 and 10 May 2021;

    (iii)the White Compliance Notice by 30 June 2021 and 7 July 2021; and

    (iv)the Jern Compliance Notice by 30 July 2021 and 6 August 2021;

    (d)Ansa Finance has still not taken the steps required by the Compliance Notices, nearly two years after the compliance with the steps in the Chawla Compliance Notice fell due.

    34.Despite being given ample time and multiple opportunities by the FWO to comply with the Compliance Notices and avoid litigation, Ansa Finance failed to comply by the required dates stipulated in the Compliance Notices. Mr Fuoco did not take any steps, on behalf of Ansa Finance, to ensure compliance.

    35.As a result of Ansa Finance's failure to comply with the Compliance Notices, the FWO had no other choice but to bring proceedings seeking orders to remedy the contraventions.

    36.Ansa Finance's conduct in failing to comply with the Compliance Notices demonstrates a deliberate disregard for their obligations under the FW Act and the authority of the FWO as a regulator of Commonwealth workplace laws.

    37.In view of these factors, the FWO submits that Ansa Finance's failure to comply with the Compliance Notices was deliberate and that a significant penalty should be imposed.

    Pay slip contravention

    38.The contravention of section 536(1) by Ansa Finance occurred in the following circumstances:

    (a)Despite Mr Manztioukas performing work for the First Respondent during the period of 7 December 2020 to 18 February 2021, and receiving payment for this work during that same period, Mr Manztioukas was not provided with pay slips until May 2021;

    (b)The pay slips were therefore provided several months after the time frame required by the FW Act, and only after the FWO issued an infringement notice to Ansa Finance on 31 March 2021 in relation to the pay slips;

    (c)The Respondents admit that they failed to provide Mr Manztioukas with pay slips within one day of paying him an amount in relation to the performance of work;

    (d)Notwithstanding that this admission necessarily constitutes a contravention of section 536(1) of the FW Act, the Respondents denied that they contravened section 536(1) of the FW Act; and

    Based on the above, this Court determined that the elements of the contravention were made out and accordingly made a declaration of contravention.”

25. The Compliance Notices issued to the first respondent required it to take specific steps to remedy the direct effects of the substantive contravention[22]. The liability judgment found that the respondents had failed to take those steps in the time provided by the notice or at any time thereafter.

    [22] FW Act s 716(2)

26. Mr Adams submitted that the Court must take into account the fact that the respondents have again done nothing to comply with the Compliance Notices despite the Court orders made on 14 October 2022 compelling the respondents to undertake specific compliance action. In the absence of evidence to the contrary, I infer that the respondents have made a conscious decision not to comply.

27. With regard to the pay slip contraventions, Mr Adams’ primary submission was that it was unreasonable for the respondents to have made admissions to the constituent elements of sub-section 536(1) but still maintain a denial of the substantive contravention. By doing so, the Ombudsman was required to expend public monies and devote scare resources to litigate an issue which could been dealt with by admissions or by way of making a statement of agreed facts (SOAF). If appropriate and obvious admissions had been made the respondents, it could have obviated the need for the Court to determine the pay slip issue.

28. Mr Adams conceded that this issue of pay slips did not take up substantial Court time during the liability hearing as the contravention was not actively contested. However, he maintained that public monies had to be expended to prepare trial affidavits which addressed the issue and the respondents had not done anything which would merit a discount.

29. I accept the Ombudsman’s submission that the respondents’ failure to make obvious admissions contributes to the overall theme of the respondents engaging in a course of conduct that was aimed at frustrating the Ombudsman, its inspectors and the legal process. However, while the respondents could have made some admissions of matters alleged in the statement of claim, there was no obligation on the respondents to make a SOAF with the Ombudsman, especially in circumstances where the respondents denied other aspects of the contraventions that were alleged against them.

30. Overall, I am of the view that the contraventions by the respondents should be regarded as serious. They do not have the character of being inadvertent or the product of oversight. Rather the whole of the evidence points to acts of conscious evasion of responsibility where the respondents have chosen to put their own interests ahead of the employees’ right to be paid. I have found that there was no reasonable excuse for the contraventions. The penalty should reflect this finding.

    Nature and extent of loss

31. As at the time of the penalty hearing, Ms Chawla, Mr Mantzioukas, Mr White, and Mr Jern had not been paid approximately 23 months, 21 months, 20 months, and 19 months, respectively, after compliance with each of their Compliance Notices was required. The Ombudsman estimates that the underpayments still outstanding to all four employees totals $9,674.

32. The Ombudsman correctly states that it is not just the underpayment which should be seen as a loss by the former employees. There are less tangible but otherwise real losses. The employees have had to wait for payment beyond the lawful period. They have worked without payment and the respondents have obtained the benefit of their labour without recompense. Their experience of employment may be jaded and they be sceptical of future employers.

33. The failure to comply with a statutory notice also occasions a more public loss. As accepted by her Honour Judge Emmett in Fair Work Ombudsman v Viper Industries Pty Ltd & anor [2015] FCCA 492:

    “[42][…] [i]ntentional failure to comply with a mandatory notice issued by the workplace regulator is “conduct … [which] undermines the utility and effectiveness of a fundamental object” the FW Act. The failure to comply undermines and frustrates the powers conferred on Fair Work Inspectors, which are conferred for the purposes of providing an effective means of enforcing compliance with lawful minimum entitlements. There is a significant cost to the public by reason of the need to bring this matter before the court to enforce compliance.”

1. Moreover, the respondents’ failure to comply with the Compliance Notices undermines the utility of compliance notices as an effective mechanism for the efficient and cost-effective rectification of identified contraventions of the FW Act.

2. I accept the Ombudsman’s submissions, in particular the submission that non-compliance with notices occasions a greater loss than the amounts underpaid to the relevant employees. Deliberate non-compliance undermines the statutory mechanism which is aimed at ensuring those with the license to employee meet the obligations of doing so. An employee who enters a contract of employment should have the confidence that they are protected by statutory minima and that the legislation provides an enforcement mechanism to ensure obligations are met. Where employers choose not to comply with the enforcement regime, confidence in the statutory enforcement scheme is eroded.

   Size and financial circumstances of the business

3. As to this consideration, the Ombudsman submitted that the financial circumstances of Ansa Finance are potentially relevant in two ways and at two points in time. The financial circumstances of Ansa Finance at the time of the contraventions are relevant as part of the “circumstances in which the conduct took place”. The current financial circumstances of Ansa Finance are relevant in terms of its capacity to pay a penalty.

4. When looking to the extent that the financial circumstances of a contravener are taken into the Court’s consideration when determining penalty, his Honour Justice Heerey in Jordan v Mornington Inn Pty Ltd [2007] FCA 1384, stated at [99] that:

   “[99]In any event, to the extent that financial hardship might mitigate what would otherwise be an appropriate penalty, such an argument would need to be based on evidence.”

5. At the liability hearing, the respondents provided very limited evidence to the Court regarding the financial circumstances of Ansa Finance from around the time that the relevant compliance notices were issued and fell due. Mr Fuoco gave evidence and submitted that the first respondent’s financial circumstances were impacted by the COVID-19 pandemic, asserting that the company suffered a 90% reduction in revenue and a significant depletion in company resources[23]. Mr Fuoco submitted that the financial circumstances of the business should be regarded as a “reasonable excuse” as to the respondents’ non-compliance with the Notices. As outlined in the liability judgment, the respondents were unable to establish this defence due to unsatisfactory evidence of the company’s overall financial position.

   [23] Fair Work Ombudsman v ANSA Finance Pty Ltd [2022] FedCFamC2G 833 at [106]

6. The respondents have not filed any material in the penalty phase of these proceedings to inform the court of their financial capacity.

7. The Ombudsman sought to rely on evidence that Ansa Finance remains registered and that the company remains in operation. Mr Adams relied on evidence given by Mr Fuoco in the liability hearing where he confirmed that the company continued to engage in lending activities during the period of the proceedings, albeit at a lesser volume than previously.

8. The Ombudsman submits that the respondents’ choice to get the Ansa business back on its feet ahead of meeting its compliance notice obligations should be seen as an aggravating factor, which warrants a high range penalty to be imposed. The Court held that Ansa Finance's decision not to comply was a reflection of choice, not capacity. The Ombudsman says, and I accept, that it can be reasonably inferred from that choice that Ansa Finance had sufficient financial capacity to pay at least some of the outstanding wages owed but did not.

9. Alleged financial difficulties cannot be advanced as the sole or even substantial cause of its non-compliance with the relevant notices. As I observed in the liability judgment, the requirement to pay money is but one part of what is required by a compliance notice. Cooperation in performing calculations and undertaking other non-financial steps is also of great importance.

10. Mr Adams cited Fair Work Ombudsman v Theill Pipelines Pty Ltd & Anor [2021] FCCA 492 where her Honour Judge Mercuri, as she was then, emphasised the importance of the non-monetary aspects of compliance notices, stating that:[24]

    “The second respondent was involved in the contravention of failing to comply with the compliance notice […] there were aspects of the compliance notice which could have been and should have been done which did not require the expenditure of money”

    [24] Fair Work Ombudsman v Theill Pipelines Pty Ltd & Anor [2021] FCCA 492 at [73]

11. Yet none of the steps required by the relevant notices (and ordered by this Court), which do not require the payment of any money, have been taken by the respondents to date.

12. It is well-established that the size and financial circumstances of an employer do not exculpate contraventions of workplace laws, and that capacity to pay a penalty will be of less relevance than the objective of general deterrence. Regardless of the size of the business or its financial position, an employer cannot be absolved of its obligations to comply with Commonwealth workplace laws.

13. The respondents were afforded the opportunity to file evidence and make submissions as to penalty, however, they did not avail themselves of that opportunity. Accordingly, there was nothing that could satisfy the Court that the financial state of the business was a mitigating factor. The Court is sympathetic to the financial strain imposed on most businesses by the COVID-19 pandemic, but those stresses do not free a contravener of the consequences of non-compliance with provisions of the FW Act.

    Corrective action, cooperation with the FWO and contrition

14. I agree with Mr Adams submission that the respondents’ conduct not only exhibits a lack of contrition but that the Court should also infer that it has been deliberate. No corrective action or remorse has been demonstrated.

15. The Ombudsman submitted that the respondents have also shown a complete disregard and contempt for its important role as the Australian workplace relations and employment regulator. For example, the Ombudsman pointed to the following conduct which reveals Mr Fuoco’s propensity to aggressively take on the regulator rather than cooperate with it:

    (1)he threatened, then followed through with, lodging a complaint against the Ombudsman to the Commonwealth Ombudsman;

    (2)alleged that the Ombudsman had engaged in “relentless harassment” against him; and

    (3)suggested that the FWIs had failed to comply with, amongst other things, the Australian Public Service Code of Conduct.

16. In written submission, the Ombudsman also says that “Mr Fuoco also made a premature (and ultimately incorrect) assumption that the arguments he had ventilated at the liability hearing in this proceeding would be entirely accepted (or, using his words, “validated”) by this Court before any decision was issued. The Ombudsman submits that Mr Fuoco's unfounded presumption that the Respondents would be vindicated in this proceeding and his correspondingly aggressive approach towards the investigators in ongoing investigations are both factors which heighten the need for specific deterrence”[25] and a sufficiently high penalty which is reflective of the same.

    [25] Ombudsman’s Submission on Penalty at [55]

17. The Court must give weight to the lack of rectification and corrective action taken by the respondents. Where a corporate respondent is involved, an expression of contrition is most clearly seen by the way that the respondent takes steps to correct its wrongdoing and change its behaviour. As at the time of the penalty hearing, no calculations have been provided to the Ombudsman and none of the former employees have been paid the amounts required under the Compliance Notices. This demonstrates an absence of meaningful contrition on the part of Ansa Finance and Mr Fuoco, aggravated by Mr Fuoco’s acknowledgment that some of the employees were owed money

18. I agree with the Ombudsman’s submission that Mr Fuoco has not taken corrective steps or action, despite indicating at different stages that he would rectify underpayments to the employees.

19. I am prepared to accept that Mr Fuoco’s conduct reveals deliberate non-compliance and that he has presented difficulties for the Ombudsman. He has at times come out swinging against the Ombudsman and in his exchanges with the Ombudsman he has adopted positions which have been proven to be misconceived or wrong.

20. However, I am not inclined to give weight to the Ombudsman’s submission that complaints made by the second respondent about the Ombudsman and its investigators should be regarded as evidence of disregard or contempt for its role as the workplace regulator. I cannot say, on the evidence before the Court, whether there is any substance to those complaints or whether they might be substantiated after investigation. A party should not fear raising a complaint at the risk of being subjected to a higher penalty for having done so. Any complaint made by Mr Fuoco should be dealt with on its own merit.

21. If there was evidence before the Court at the time of the penalty hearing which established that a complaint had been maliciously threatened and not acted upon or had been lodged and dismissed as vexatious after investigation, I would have regard to it. But there is no such evidence here.

    Compliance with minimum standards

22. The Ombudsman emphasised that one of the principal purposes of the FW Act is to provide a guaranteed safety net of fair, relevant, and enforceable minimum terms and conditions for all employees. To be able to enforce these terms, the Ombudsman submits that inspectors must be able to exercise their compliance powers effectively. The purpose of the powers conferred on FWIs is to provide the Ombudsman with an effective means of investigating and enforcing compliance with minimum standards and industrial instruments.

23. Compliance notices are an important tool within the FW Act's enforcement framework which is designed to protect the safety net of entitlements. Failure to comply with the Notices reflects a prioritisation of the respondents’ own interests at the expense of the minimum entitlements of the former employees.

24. The failure to comply with a statutory notice properly issued by the Ombudsman should be regarded as serious. The efficacy of statutory notices such as compliance notices, indeed the whole compliance framework, will be significantly diminished if recipients perceive that a failure to comply carries no meaningful consequences.

25. The pay slips contravention illustrates the significance of the company’s record keeping to the statutory enforcement regime. Proper record keeping “is the bedrock of compliance” with workplace laws. Record keeping and pay slip obligations play a vital role in the Ombudsman’s capability to monitor and enforce compliance with minimum standards, which is one of the functions of the Ombudsman under section 682 of the FW Act.

26. In Fair Work Ombudsman v Taj Palace Tandoori Indian Restaurant Pty Ltd & Anor [2012] FMCA 258, Federal Magistrate Riethmuller (as he then was) stated:

    “[67]Proper pay slips allow employees to understand how their pay is calculated and therefore easily obtain advice. Pay slips provide the most practical check on false record keeping and underpayments, and allow for genuine mistakes or misunderstandings to quickly be identified. Without proper pay slips, employees are significantly disempowered, creating a structure within which breach of the industrial laws can easily be perpetrated.”

27. It is evident that the respondents’ conduct has frustrated the role of the Ombudsman in enforcing compliance with the notice and pay slip provisions of the FW Act.

    GROUPING, COURSE OF CONDUCT TOTALITY

    Grouping and course of conduct

28. As this matter concerns the failure to comply with four separate Compliance Notices, the Ombudsman made submissions concerning grouping and course of conduct, as well as submissions on the issue of totality.

29. Referring to the five-step approach to determining penalties as set out by Bromwich J in  Fair Work Ombudsman v NSH North Pty Ltd trading as New Shanghai Charlestown [2017] 275 IR 148, the Ombudsman submitted that each of the contraventions should be treated separately and each should be the subject of penalties. The Ombudsman submits that grouping of the four compliance notice contraventions is not warranted.

30. The Ombudsman cited Fair Work Ombudsman v Tester [2021] FCCA 771 where Judge Jarrett (as his Honour then was) explained the operation of the “course of conduct” provisions in section 557 of the FW Act and the related discretion which the Court has to “group” contraventions. In the context of section 716(5) of the FW Act, Judge Jarrett articulated:

    “[13]Contraventions of s.716(5) do not attract the operation of the course of conduct provisions provided for in s.557(1) of the Act because s.716(5) is not a civil remedy provision specified in s.557(2) of the Act.

    [14]Notwithstanding that, the Court has a discretion to group separate contraventions together where the contraventions may be said to overlap with each other or involve the potential double punishment of a respondent for the same or substantially similar conduct. The onus to demonstrate such overlap or commonality of factual substratum is on the respondent and there is no evidence before the Court that the respondent's failure to comply with the two notices arose from the one transaction or decision such that they should be grouped together.

    [15]Moreover, each of the notices related to different employees engaged under different awards and identified different contraventions. Each notice required the respondent to take action specific to the employees and contraventions identified in that notice. I accept that for that reason, the obligations imposed by each notice were wholly separate and distinct. I am satisfied that the respondent's decisions not to comply with each notice did not constitute a single transaction.”

31. The Ombudsman also relied on the judgment of Judge Laing in Fair Work Ombudsman v Big Daddy's Pty Ltd [2022] FedCFamC2G 786 where her Honour found that two compliance notice contraventions should not be grouped notwithstanding the presence of the following:

    (1)the two compliance notices with which the proceeding was concerned were issued in relation to two employees who were spouses;

    (2)the two employees requested assistance from the Ombudsman jointly and on the same day;

    (3)the notices related to overlapping (but not identical) periods of employment;

    (4)the compliance notices were sent on the same day (attached to the same email), had the same deadline for compliance and were referred to collectively in the covering email to which they were attached;

    (5)the employees were engaged under the same award (albeit under different classifications); and

    (6)there was some overlap between the contraventions citied in each of the compliance notices (although there were also differences).

32. In this proceeding the Ombudsman acknowledges that the four Compliance Notices all related to a single modern award, but submits that there are few other common features. Accordingly, it is submitted that grouping or treating the contraventions as a single course of conduct is not justified when one has regard to the following:

    (1)there is no evidence that the former employees Ms Chawla, Mr Mantzioukas, Mr White and Mr Jern have any relationship or connection beyond their previous shared employment;

    (2)each employee requested assistance separately and on different dates;

    (3)the Compliance Notices relate to different (non-overlapping) periods of employment;

    (4)while the employees were engaged under the same award, they were not all under the same classification;

    (5)there was some overlap between the contraventions cited in each of the Compliance Notices, although there were also differences; and

    (6)compliance with the notices fell due on different dates.

33. By reason of the differences referred to above, the Ombudsman submits that the decision by Ansa Finance not to comply with each Compliance Notice was a separate and distinct decision and that each decision should be penalised accordingly.

34. It was also submitted by the Ombudsman that even if the failure to comply with the four Compliance Notices is held to have arisen out of one course of conduct, that should not operate to reduce the contraventions to a single contravention or reduce the maximum penalty available. The Ombudsman submits that any overlap should be addressed by applying the totality principle, rather than by grouping the contraventions as one.

35. I have carefully considered the Ombudsman’s submissions and the authorities on which they rely. I do not share the Ombudsman’s view. In my opinion the compliance notice contraventions should be grouped and treated as having arisen during a single course of conduct.

36. It is open to the Court to impose a single penalty for multiple contraventions if they arose “out of substantially the same act, omission or occurrences”[26] or “out of the same transaction”[27], have “common elements”[28],  “where the contraventions may be said to overlap with each other or involve the potential double punishment of a respondent for the same or substantially similar conduct”[29].  Some cases lend themselves to grouping, others do not.

    [26] Royer v Western Australia [2009] WASCA 139 at [22]

    [27] Trade Practices Commission v Bata Shoe Company of Australia Pty Ltd [1980] FCA 47

    [28] Fair Work Ombudsman v Offshore Marine Services Pty Ltd [2021] FCA 498 at [7], [23]-[26])

    [29] Fair Work Ombudsman v Tester [2021] FCCA 771 at [14]-[15]

37. Based on my consideration of the evidence as a whole, I believe the contraventions share numerous common features. The nature of each employees’ employment, the award which applies to their employment, the nature of the underpayments, the manner in which the investigation process was undertaken and the timing of the notices and dates for compliance being proximate (but not identical), the form of the Compliance Notices and the steps required to be taken by each of them, the potential impact of COVID-19 on the operations of the respondents at the relevant time, the reasons advanced by the respondents for not complying (albeit those reasons were not accepted as a reasonable excuse) all lean toward treating these contraventions as having arisen in what, on this occasions, I consider to be a single transaction or course of conduct.

38. Furthermore, the respondents did not have a prior record of having contravened the Fair Work Act. When the Compliance Notices were issued, the respondents adopted a common defence to each of them believing, erroneously, that they had a reasonable excuse for not complying. The common rejection of all the notices by the respondents, the form and content of communications between the Ombudsman and the respondents regarding the Notices, the common proceedings in this Court, the nature of the defence run by the respondents and other matters show an overlap.

39. I have taken into account the various authorities referred to in the Ombudsman’s submissions and I accept that in circumstances not too dissimilar to the present some judges of this Court might be inclined to impose separate penalties. The judgment required here is a fine one and it is based on the circumstances of this case alone.

40. I propose to group the compliance notice contraventions as a single contravention, albeit a serious one for which each of Ansa and Mr Fuoco should pay a penalty of 75% of the maximum.

41. The payslip contravention is a completely separate contravention arising from a different provision of the FW Act, relating to a different period than those to which the Compliance Notices relate and to only one of the employees. I agree that it should be treated as a separate and distinct contravention. By reason of the penalty ascribed to a breach of section 536, I infer that parliament regards it as a more serious offence. I do not consider it can or should be grouped with the compliance notice contraventions.

1. Taking into account the whole of the evidence, and the fact that the respondents do not have a prior history of contraventions, I will impose a penalty of 50% of the maximum for the breach of section 536.

   Totality

2. No previous contraventions were alleged by the Ombudsman in respect of either respondent. From this, the Court will regard the respondents as first time contraveners.

3. The totality principle requires the Court to take a final look at the aggregate penalty, to determine whether it is an appropriate response to the conduct which led to the breaches. The penalty imposed must not be oppressive or crushing, but it must nevertheless bear relativity to the seriousness of the conduct engaged in by the respondents. The penalty must strike a reasonable balance between deterrence and oppressive severity.

4. I am satisfied the penalties I have determined do strike that reasonable balance and are an appropriate response to the respondents conduct overall. For that reason, I do not propose to make any further adjustment by applying the “totality principle”.

5. I am satisfied that the penalties reflect my consideration of the relevant factors and are properly directed to the objective of deterrence.

   CONCLUSION

6. For the reasons set out above, the Court imposes the following penalties:

   (1)For the declared contraventions of section 716(5) in respect of the Chawla Compliance Notice, the Mantzioukas Compliance Notice, the White Compliance Notice and the Jern Compliance Notice:

Respondent	Contravention	Maximum Penalty	Percentage of maximum	Penalty
Ansa Finance Pty Ltd	s.716(5)	$33,300.00	75%	$24,975.00
Joshua Fuoco	s.716(5)	$6,660.00	75%	$4,995.00

(2)For the declared contravention of s 536(3) in respect of the Mantzioukas payslip contravention:

Respondent	Contravention	Maximum Penalty	Percentage of maximum	Penalty
Ansa Finance Pty Ltd	s.536(3)	$66,600.00	50%	$33,300.00
Joshua Fuoco	s.536(3)	$13,320.00	50%	$6,660.00

1. Each of the penalties are to be paid within 28 days of the date of these orders. Unless otherwise ordered by the court, the penalties are to be paid to the consolidated revenue of the Commonwealth.

2. I grant liberty to the parties to make any application for costs within 28 days of these orders.

I certify that the preceding one hundred and sixteen (116) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Forbes.

Associate:

Dated:       13 February 2024