FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Fair Work Ombudsman v Chen [2025] FedCFamC2G 1430
ORDERS
SYG 2172 of 2024 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: FAIR WORK OMBUDSMAN
Applicant
AND: KAILIANG CHEN
First Respondent
ALEX DU
Second Respondent
ORDER MADE BY:
JUDGE LAING
DATE OF ORDER:
3 SEPTEMBER 2025
THE COURT DECLARES BY CONSENT THAT:
1.The Respondents contravened s 716(5) of the Fair Work Act 2009 (Cth) (FW Act) by failing to comply with the compliance notice given to the Respondents on 25 August 2023 (Compliance Notice).
THE COURT ORDERS BY CONSENT THAT:
2.Pursuant to ss 545(1) and 545(2)(d) of the FW Act, the Respondents jointly and severally take the steps that…
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- AGLC
- Fair Work Ombudsman v Chen [2025] FedCFamC2G 1430
- Case
- [2025] FedCFamC2G 1430
- Decision Date
CaseChat Overview and Summary
The legal issues the court had to resolve included whether the penalties proposed by the parties were appropriate and whether the orders agreed upon by the FWO and the respondents should be enforced. The court examined the seriousness of the contraventions, the respondents' level of cooperation and contrition, and the need to ensure compliance with minimum standards to maintain the integrity of the Fair Work Act. The court also took into account the deterrence of similar breaches in the future, ensuring that the penalties served as a meaningful consequence for non-compliance.
The court concluded that the penalties and orders proposed by the parties were appropriate. It found that the respondents' cooperation, while significant, was not enough to warrant a substantial reduction in penalties, given that not all outstanding steps required by the Compliance Notice had been taken. The court highlighted the importance of ensuring compliance with minimum standards and the need to maintain the efficacy of statutory notices to protect the safety net of entitlements. The court accepted the submissions of the FWO that the penalties should reflect the seriousness of the contraventions and the importance of deterrence. Consequently, the court made orders requiring the respondents to pay the penalties and associated orders as agreed.
The court's decision was based on a holistic assessment of the circumstances, ensuring that the penalties and orders served their intended purpose of compliance and deterrence. The court's reasoning underscored the importance of upholding the Fair Work Act and protecting employees' entitlements. The final orders required the respondents to pay the penalties and comply with the agreed associated orders.
Orders
Orders of the court
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Background
Background to the litigation
Evidence
Evidence Before The Court
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Decision
Reasons for decision
Ratio Decidendi
Legal Principle Established
In the present case, the evidence does not establish the size of the business or its financial circumstances in any detail. As noted above, although reference has been made to a “cash flow situation”, no clear evidence in this regard has been provided. In any event, as the FWO submitted, the financial position of the business provides no excuse for failure to comply with the FW Act.Cooperation, contrition and corrective action As set out above, the Respondents have partially complied with the requirements of the Compliance Notice. However, the Respondents acknowledge that full compliance has not occurred. Underpayment Amounts acknowledged to be owing to certain Employees have not been paid. The Respondents have admitted the contraventions and entered into the SOAF, thereby avoiding further costs associated with a fully contested hearing. However, as the FWO observed, this only occurred after the commencement of litigation and some perseverance on the part of the FWO. It was also after an initial lack of engagement by the Respondents with the proceeding, resulting in the FWO expending resources in applying for default judgment: SG Affidavit at [12]-[24]; SG Supplementary Affidavit at [7]-[20]. I accept the FWO’s submission that cooperation by the Respondents, including through the SOAF, ought to be given appropriate weight in considering the issue of penalties. However, I also accept the FWO’s submission that the weight that ought to be given to this is impacted by the fact that there are still outstanding steps required by the Compliance Notice regarding the calculation and payment of entitlements. I also accept that it may be inferred that steps towards rectification may not have been taken without the FWO’s pursuit of this proceeding and that the entry into the SOAF may have been an acceptance by the Respondents of the “inevitable”: see Fair Work Ombudsman v Matcraft Pty Ltd [2021] FCCA 272 at [78] (Judge Kendall). The FWO submits that a discount of 10% should be applied on account of the Respondents’ admissions and cooperation. I prefer to consider the question of penalties in this matter holistically, rather than by reference to such a percentage. This is in circumstances where there is potential overlap between the considerations that may inform the Court’s reasoning under a number of headings.The need to ensure compliance with minimum standards The FWO submitted that a failure to comply with a statutory notice is serious. Failure to comply undermines the FW Act’s enforcement framework and the safety net of entitlements it is designed to protect: Fair Work Ombudsman v Tester [2021] FCCA 771 at [27] (Judge Jarrett). The efficacy of statutory notices would be hindered or made redundant if the recipients perceive that failure to comply will not carry meaningful consequences: Fair Work Ombudsman v Nobrace Centre Pty Ltd & Anor (No.2) [2019] FCCA 2144 (Judge Blake) at [40]. I accept these submissions and have taken them into account in determining penalties.Deterrence