Fair Work Ombudsman v Buffalos Cairns Operations Pty Ltd
[2023] FedCFamC2G 355
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Fair Work Ombudsman v Buffalos Cairns Operations Pty Ltd [2023] FedCFamC2G 355
File number(s): BRG 446 of 2021 Judgment of: JUDGE EGAN Date of judgment: 9 May 2023 Catchwords: INDUSTRIAL LAW – Application for imposition of pecuniary penalties for non-compliance with compliance notices – where no contrition or co-operation shown by Respondent – where money owed to employees has not been paid – where the Respondent has failed to comply with Court orders – pecuniary penalty orders made accordingly. Legislation: Fair Work Act 2009 (Cth) ss. 545(1), 546(1), 716(5) Cases cited: Fair Work Ombudsman v Promoting You Pty Ltd [2012] FMCA 58
Kelly v Fitzpatrick [2007] FCA 1080
Division: Division 2 General Federal Law Number of paragraphs: 16 Date of last submission/s: 8 May 2023 Date of hearing: 8 May 2023 Place: Brisbane Solicitor for the Applicant: Ms Dwight - Fair Work Ombudsman The Respondent: No appearance ORDERS
BRG 446 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: FAIR WORK OMBUDSMAN
Applicant
AND: BUFFALOS CAIRNS OPERATIONS PTY LTD
Respondent
order made by:
JUDGE EGAN
DATE OF ORDER:
9 may 2023
THE COURT ORDERS THAT:
1.Pursuant to the provisions of s. 546(1) of the Fair Work Act 2009 (Cth) (‘FWA’), the Respondent shall pay pecuniary penalties in the amount of $29,970.00 to the Consolidated Revenue Fund of the Commonwealth by reason of its contravention of the provisions of s. 716(5) of the FWA, such payment to be made on or before 4.00pm on 5 June 2023.
2.Each party have liberty to apply on the giving of three (3) days’ notice, each to the other.
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 Egan
Introduction
On 16 November 2022, the Court made the following orders:
“IT IS ORDERED THAT:
1.Summary judgment be entered in favour of the Applicant pursuant to rule 13.10(1)(b)(ii) of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law Rules) 2021 (General Federal Rules).
2.Pursuant to s 545(1) of the Fair Work Act 2009 (Cth) (FW Act), the Respondent remedy the direct effects of the contraventions set out in the First CN within 28 days of this order, by paying $3,599.17 (the Patel Outstanding Amount) and $2,699.06 (the Bahadir Outstanding Amount) to the Applicant.
3.Pursuant to s 547(2) of the FW Act, the Respondent pay the Applicant interest on the Patel Outstanding Amount in the sum of $255, and in respect of the Bahadir Outstanding Amount, interest in the sum of $197, calculated in accordance with the Federal Court of Australia’s Interest on Judgments Practice Note (GPN-INT) and for the period from 1 March 2021 to the date of the Court’s orders, to the Applicant.
4.Pursuant to s 545(1) of the FW Act, the Respondent remedy the direct effects of the contraventions set out in the Second CN within 28 days of this order, by paying $992.03 in respect of the amount owed to Ms Kerbid for her first period of employment (the First Kerbid Outstanding Amount) to the Applicant.
5.Pursuant to s 547(2) of the FW Act, the Respondent pay the Applicant interest on the First Kerbid Outstanding Amount in the sum of $75, calculated in accordance with the Federal Court of Australia’s Interest on Judgments Practice Note (GPN- INT) and for the period from 1 March 2021 to the date of the Court’s orders, to the Applicant.
6.Pursuant to s 545(1) of the FW Act, the Respondent remedy the direct effects of the contraventions set out in the Third CN within 28 days of this order, by paying $1,466.43 in respect of the amount owed to Ms Kerbid for her first period of employment (the Second Kerbid Outstanding Amount) to the Applicant.
7.Pursuant to s 547(2) of the FW Act, the Respondent pay the Applicant interest on the Second Kerbid Outstanding Amount in the sum of $107, calculated in accordance with the Federal Court of Australia’s Interest on Judgments Practice Note (GPN-INT) and for the period from 1 March 2021 to the date of the Court’s orders, to the Applicant.
8.Pursuant to s 545(1) of the FW Act and s 140 of the Federal Circuit and Family Court of Australia Act 2021 (Cth), the Applicant, within 90 days of receipt, distribute the amounts referred to in paragraphs 2, 3, 4, 5, 6 and 7 to Mr Patel, Mr Bahadir and Ms Kerbid respectively.
IT IS FURTHER ORDERED THAT:
9.The Respondent’s Application in a Case to dismiss the proceedings filed on 14 February 2022 be dismissed pursuant to rule 13.06(1)(d) of the General Federal Rules.
10.The Applicant have liberty to apply on the giving of two (2) days’ notice.”
Since the making of the Court orders, the respondent has failed to comply with the orders which required the payment of monies to former employees. Further, there has been no co-operation in any respect by or on behalf of the respondent with the applicant in relation to the making of any arrangement for the payment of such monies in the future. Neither has there been any contrition shown by or on behalf of the respondent for the respondent’s failure to comply with its legislative obligations under the provisions of s. 545(1) of the Fair Work Act 2009 (Cth) (‘FWA’).
An expression of contrition for offending conduct is most clearly observed by the way the corporation has sought to alleviate its wrongdoing and change its behaviour. [1]
[1] Ace Insurance Limited v Trifunovski (No 2) [2012] FCA 793 at [113] – [114] per Perram J.
The application before the Court today was an application for the imposition of pecuniary penalties for non-compliance with three (3) compliance notices issued against the respondent. Each compliance notice was dated 22 January 2021.
The first compliance notice related to the non-payment of $3,854.17 in respect of an employee named Patel, and the non-payment of $6,750.23 in respect of an employee named Bahadir.
The second compliance notice related to the first non-payment of $1,067.03 in respect of an employee named Kerbid.
The third compliance notice related to the second non-payment of the sum of $1,573.43 in respect of the employee named Kerbid.
On the question of general deterrence, Tracy J in Kelly v Fitzpatrick [2007] FCA 1080 at [28] said as follows:
“[28] The respondents have expressed contrition and have put in place mechanisms which are designed to ensure that there will be no repetition of the breaches which have led to the present proceeding. Specific deterrence does not, therefore, loom large as a consideration in determining penalty. It does not follow that the need for general deterrence may be disregarded. As Finkelstein J said in CPSU v Telstra Corporation Limited [2001] FCA 1364; (2001) 108 IR 228 at 231: "even if there be no need for specific deterrence, there will be occasions when general deterrence must take priority, and in that case a penalty should be imposed to mark the law’s disapproval of the conduct in question, and to act as a warning to others not to engage in similar conduct ..." No less than large corporate employers, small businesses have an obligation to meet minimum employment standards and their employees, rightly, have an expectation that this will occur. When it does not it will, normally, be necessary to mark the failure by imposing an appropriate monetary sanction. Such a sanction "must be imposed at a meaningful level": see Australian Competition and Consumer Commission v ABB Transmission and Distribution Ltd [2001] FCA 383; [2001] ATPR 41-815 at [13].”
Though any penalty must be commensurate with the seriousness of the conduct engaged in, any such penalty must not be crushing or oppressive. [2]
[2] Fair Work Ombudsman v Promoting You Pty Ltd [2012] FMCA 58
There was no appearance on behalf of the respondent on either 16 November 2022 when orders for the payment of monies were made, or on 8 May 2023 when the application for the imposition of pecuniary penalties was listed for hearing before the Court. Hence, any penalty imposed by the Court in the present matter must reflect the need for specific as well as general deterrence principles to be applied.
It was appropriately acknowledged by Ms Dwight on behalf of the applicant that the conduct of the respondent was similar in respect of each of the named employees the subject of the compliance notices. It was for that reason that it was submitted that the penalties to be imposed under s. 716(5) of the FWA ought to be weighted according to the submitted seriousness of each contravention as follows:
(a)First Compliance Notice $19,980.00 (60% of maximum penalty)
(b)Second Compliance Notice $3,330.00 (10% of maximum penalty)
(c)Third Compliance Notice $6,660.00 (20% of maximum penalty)
When making submissions as to general deterrence principles to be adopted by the Court when imposing a penalty, particularly in relation to an appropriate message being sent to those entities operating in the café and restaurant industries, it was submitted at [24] – [27] of the applicant’s written submissions on penalty filed on 21 February 2023 as follows:
“General Deterrence
[24]The Respondent’s refusal to comply with the Compliance Notices arguably undermines the enforcement framework in the FW Act, and the safety net of entitlements it is designed to protect. 31 Recipients of statutory notices issued by Government regulators such as the Applicant must be under no misapprehension about their obligations to comply with those notices,32 and that failure to do so will result in consequences.
[25]As part of its functions, the Applicant collects data and prepares reports in relation to compliance and disputes across industries in Australia.33 On 25 November 2022, the Applicant prepared a report titled ‘Fair Work Ombudsman Industry profile and FWO Interactions: Cafes and Restaurants’ (Industry Report).34
[26]The Respondent operated in the restaurant industry in Cairns, Queensland. During the time the Former Employees were employed, the Industry Report indicates that 20% of disputes in that industry arose in Queensland, and that of the contraventions identified, 7% related to annual leave and 10% concern termination of employment. The Industry Report also indicates that, during the period, the Applicant issued 354 compliance notices in the cafe and restaurant industry, being 17.5% of all compliance notices issued by the Applicant.
[27]The Applicant submits that it is open to the Court to conclude that there is a higher level of non-compliance in the restaurant industry, in which the Respondent operated, and that this amplifies the need for general deterrence.”
In circumstances where the respondent’s principal director was aware of the existence of the compliance notices but failed to respond in a positive way notwithstanding follow up telephone calls, letters and emails sent to him and to the respondent by the applicant, the Court is of the view that the submitted penalties which ought to be imposed are in all respects reasonable.
There is no evidence before the Court that the respondent company was at any material time unable to make the payments ordered to be made by the Court. The fact that the respondent was a small company does not relieve it from complying with all relevant legislative requirements imposed upon it pursuant to the provisions of the FWA. The respondent remained a registered company as at the date of the hearing before the Court.
Having weighed up all of the relevant considerations submitted as being appropriate, and as contained in the written submissions filed on behalf of the applicant, it is ordered that pecuniary penalties be imposed as follows:
(a)First Compliance Notice $19,980.00 (60% of maximum penalty)
(b)Second Compliance Notice $3,330.00 (10% of maximum penalty)
(c)Third Compliance Notice $6,660.00 (20% of maximum penalty)
The parties shall have liberty to apply on the giving of three days’ notice, each to the other.
I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Egan. Associate:
Dated: 9 May 2023
0
5
0