Fair Work Ombudsman v Clark Projects Pty Ltd

Case [2025] FedCFamC2G 24

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 2)

Fair Work Ombudsman v Clark Projects Pty Ltd [2025] FedCFamC2G 24

File number(s): SYG 1981 of 2024
Judgment of: JUDGE DOUST
Date of judgment: 28 February 2025
Catchwords: FAIR WORK – compliance notice issued under s 716 of the Fair Work Act 2009 (Cth) (the Act) – whether contravention of s 716(5) of the Act – default judgment – whether orders for payment of compensation should be made – whether declaration of contravention should be made
Legislation:

Corporations Act 2001 (Cth) s 109X

Fair Work Act 2009 (Cth) ss 545, 547, 716, 717

Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) rr 4.03, 4.04, 6.01, 6.08, 13.04(2), 13.05(2)

Federal Court Rules 2011 (Cth) rr 5.23(2), 16.07
Cases cited:

Australian Building and Construction Commission v Construction, Forestry, Mining and Energy Union (2018) 262 CLR 157; (2018) 92 ALJR 219; [2018] HCA 3

Chappel v Hart (1998) 195 CLR 232; (1998) 72 ALJR 1344; [1998] HCA 55

Dafallah v Fair Work Commission (2014) 225 FCR 559; [2014] FCA 328

Fair Work Ombudsman v Carers Portland Inc [2023] FedCFamC2G 620

Fair Work Ombudsman v Cobra Security Services Pty Ltd [2024] FedCFamC2G 336

Fair Work Ombudsman v Pure Telecom Pty Ltd [2024] FedCFamC2G 664

Fair Work Ombudsman v Sails Waterfront Bar & Grill Pty Ltd (No.2) [2021] FCCA 1511

Fair Work Ombudsman v Taing [2024] FedCFamC2G 270

Kazal v Thunder Studios Inc (California) [2023] FCAFC 174

March v Strahmare (E & MH) Pty Ltd (1991) 171 CLR 506; (1991) 65 ALJR 334; [1991] HCA 12

Patrick Stevedores Holdings Pty Ltd v Construction, Forestry, Maritime, Mining and Energy Union (No 4) [2021] FCA 1481

Thomson v STX Pan Ocean Co Ltd [2012] FCAFC 15
Division: Fair Work
Number of paragraphs: 74
Date of hearing: 22 November 2024
Place: Sydney
Counsel for the Applicant: Mr C McDermott
Solicitor for the Applicant: Ms R O’Brien, Office of the Fair Work Ombudsman
The Respondent:  No appearance

ORDERS

SYG 1981 of 2024

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN:

FAIR WORK OMBUDSMAN

Applicant
AND:

CLARK PROJECTS PTY LTD ACN 617 266 501

Respondent

ORDER MADE BY:

JUDGE DOUST

DATE OF ORDER:

28 FEBRUARY 2025

THE COURT ORDERS THAT:

1.Upon the default by the respondent, the Court declares that the respondent contravened s 716(5) of the Fair Work Act2009 (Cth) (FW Act) by failing to comply with the compliance notice issued to it by Fair Work Inspector Heidi-Marie Brown on 22 June 2023.

2.Pursuant to s 545(1) of the FW Act, the respondent shall take the following steps to remedy the direct effects of its non-compliance with the compliance notice:

(a)within 28 days of this order pay $5,183.35, being the Underpayment Amount of $4,583.18, along with interest, to Mr Nathan Lee;

(b)within 42 days of this order calculate and pay any additional superannuation contributions payable in respect of the Underpayment Amount…

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Fair Work Ombudsman v Clark Projects Pty Ltd [2025] FedCFamC2G 24
Case
[2025] FedCFamC2G 24
Decision Date

CaseChat Overview and Summary

In the case of Fair Work Ombudsman v Clark Projects Pty Ltd, the Fair Work Ombudsman sought relief against Clark Projects Pty Ltd for contraventions of the Fair Work Act 2009 (Cth). The primary dispute centred on whether the respondent had contravened section 716(5) of the Act, which pertains to compliance notices. The Fair Work Ombudsman sought default judgment, compensation for the employees, and a declaration of contravention.

The legal issues the court had to address were whether the respondent had contravened section 716(5) of the Act, and if so, whether the court should order the payment of compensation and make a declaration of contravention. The court examined whether the respondent had been provided with sufficient opportunities to contest the allegations and the quantum of the underpayment before any compensation order was made. The court also considered the statutory purpose of ordering compensation and whether it would be a proper exercise of the court’s power under section 545(2)(a) of the Act.

The court found that it was appropriate to make orders for the payment of compensation in the sum of the underpayment amount by the respondent to the employee. The respondent had been on notice of the quantum of compensation sought and the basis for the calculation, had an opportunity to contest the making of any such orders and the quantum of compensation, but had declined to defend the proceeding. The court also found it appropriate to order the respondent to calculate and pay additional superannuation contributions on the underpayment amount, but granted additional time for compliance due to the administrative complexity of such an order. The court concluded that making these orders was a proper exercise of its power to remedy the effects of a contravention.

The final orders included the payment of the underpayment amount by the respondent to the employee and the calculation and payment of additional superannuation contributions, with additional time granted for the latter. The court also made a declaration of contravention against the respondent.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

Nothing about that approach affects the manner in which the provisions in the FW Act concerning contraventions of Awards operate. Compensation being awarded in an instance like the present does not raise the prospect of a raft of proceedings where compensation is granted without a proper basis being made out. The class of matters where this question arises is limited. Only inspectors, as defined in the FW Act, may issue, and bring proceedings for, failure to comply with, compliance notices. An application for compensation arising from failure to comply with a compliance notice may only be made where the respondent has not approached the Court to vary or cancel the notice pursuant to s 717 of the FW Act, or has approached the Court and failed to have the notice set aside, and has then also failed to comply with the compliance notice without having a reasonable excuse. That is, compensation will only be ordered after the employer has had two opportunities to contest the allegation of the underlying contravention and the quantum of the underpayment. If in that event the Court is satisfied, whether on the basis of admissions (as was Judge Cameron in Fair Work Ombudsman v Pure Telecom Pty Ltd [2024] FedCFamC2G 664), or after a contest as to quantum, that the compensation being sought reflects the true measure of an employer’s compliance obligation, it is not clear what statutory purpose would be served by declining to make orders for such compensation but to instead require the regulator or some other party to commence another proceeding, exposing the employer to a possible further civil penalty, before such compensation may be ordered. CONCLUSION It is appropriate for the Court to make orders for the payment of compensation in the sum of the Underpayment Amount by the respondent to the employee in the present circumstances. Those circumstances include that the respondent has been on notice since the commencement of the proceeding of the quantum of compensation sought by the applicant and the basis of the calculation of that compensation, has had an opportunity to be heard as to the making of any such orders and the quantum of any compensation to be ordered, and has declined to appear to defend the proceeding. I am also satisfied that such orders would be a proper exercise of the Court’s power to make orders to remedy the effects of a contravention, as contemplated in s 545(2)(a) of the FW Act, as discussed by Judge Manousaridis in Fair Work Ombudsman v Sails Waterfront Bar & Grill Pty Ltd (No.2) [2021] FCCA 1511. I am satisfied, for the same reasons that it is appropriate to make orders for the respondent to calculate and pay additional superannuation contributions on the Underpayment Amount. Those steps were also required by the compliance notice. However, I consider it appropriate in the circumstances to allow the respondent additional time to comply with such order, anticipating that such step may be more administratively complicated than the payment to the employee of the outstanding monies.

Ratio Decidendi

Legal Principle Established

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