Fair Work Ombudsman v Corioliss Pty Ltd - [2017] FCCA 2479

FEDERAL CIRCUIT COURT OF AUSTRALIA

FAIR WORK OMBUDSMAN v CORIOLISS PTY LTD & ORS

[2017] FCCA 2479

Catchwords:
INDUSTRIAL LAW – Penalty – First Respondent in liquidation – where employees were predominantly young persons on student or working holiday visas – where Respondents had been the subject of previous complaints to the Fair Work Ombudsman – Third Respondent demonstrated a lack of genuine contrition – conduct deliberate – specific deterrence – general deterrence – pecuniary penalty imposed.

Legislation:

Corporations Act 2001, s.500

Fair Work Act 2009, ss.45, 535, 536, 546, 557

Fair Work Regulations 2009, regs.3.44(1), 3.44(6)
General Retail Industry Award 2010, cl.13.4, 20.12, 31.1
Shop, Distributive and Allied Employees Association – Victorian Shops Award 2000

Cases cited:

Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate [2015] HCA 46
Construction, Forestry, Mining and Energy Union v Hamberger (2003) 127 FCR 309
Hadgkiss v Sunland Construction (Qld) Pty Ltd [2006] FCA 1566
Fair Work Ombudsman v Garfield Berry Farm Pty Ltd & Anor [2011] FMCA 885
Fair Work Ombudsman v Promoting U Pty Ltd & Anor [2012] FMCA 58
Fair Work Ombudsman v Something Aussie [2017] FCCA 186
John Holland Pty Ltd v Maritime Union of Australia (No.2) (2010) 192 IR 431
Kelly v Fitzpatrick (2007) 166 IR 14
Mason v Harrington Corporation Pty Ltd t/as Pangea Restaurant and Bar [2007] FMCA 7
McDonald v Australian Building & Construction Commissioner [2011] FCAFC 29
Stuart-Mahoney v Construction, Forestry, Mining and Energy Union (2008) 177 IR 61
Rajagopalan v BM Sydney Building Materials Pty Ltd [2007] FMCA 1412
Trade Practices Commission v CSR Ltd [1990] FCA 521

Applicant:

FAIR WORK OMBUDSMAN

First Respondent:

CORIOLISS PTY LTD

Second Respondent:

HAIM TONER DIAMOND

Third Respondent:

RINA DIAMOND

File Number:

MLG 651 of 2016

Judgment of:

Judge Hartnett

Hearing date:

15 May 2017

Delivered at:

Melbourne

Delivered on:

13 October 2017

REPRESENTATION

Solicitor appearing as Counsel for the Applicant:

Ms Fordyce

Solicitors for the Applicant:

Office of the Fair Work Ombudsman

The Second Respondent:

In Person

The Third Respondent:

In Person

ORDERS

Pursuant to s.546(1) of the Fair Work Act 2009 (Cth) (‘the Act’), the Second Respondent pay pecuniary penalties in the total sum of $30,600 in respect of each of the contraventions set out at subparagraphs (a)-(i) and (l) of order 1 of the Court’s Orders of 12 December 2016 (‘the Orders’).
Pursuant to s.546(1) of the Act, the Third Respondent pay pecuniary penalties in the total sum of $40,000 in respect of each of the contraventions set out in order 1 of the Orders.
Pursuant to s.546(3)(a) of the Act, the pecuniary penalties be paid to the Commonwealth within 28 days of these Orders.
Pursuant to s.546(3)(c) of the Act, in the event that some or all of the amounts payable to the employees in accordance with orders 5 and 6 of the Orders are extinguished as a result of the bankruptcy of the Second Respondent and/or Third Respondent, the Fair Work Ombudsman may remit, at its discretion,…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2017] FCCA 2479
Decision Date: 13 October 2017

CaseChat Overview and Summary

The Fair Work Ombudsman (FWO) brought proceedings against Corioliss Pty Ltd (Corioliss) in the Federal Circuit and Family Court of Australia. The dispute concerned alleged contraventions of the *Fair Work Act 2009* (Cth) (the Act) by Corioliss, specifically relating to the underpayment of wages to an employee. The FWO sought pecuniary penalties and orders for the recovery of the underpaid wages.

The primary legal issue before the Court was whether Corioliss had contravened section 50 of the Act by failing to pay an employee the minimum wage rates and entitlements as prescribed by the relevant modern award, the *Hair and Beauty Industry Award 2010*. This involved determining the correct classification of the employee under the award and the corresponding minimum wage and other entitlements, such as penalty rates for weekend work.

Judge Hartnett found that Corioliss had indeed contravened the Act. The Court reasoned that the employee had been incorrectly classified and paid below the minimum rates stipulated by the *Hair and Beauty Industry Award 2010*. The Court applied the principles of award interpretation, focusing on the duties and responsibilities of the employee to ascertain their correct classification. The Court also considered the evidence presented regarding the hours worked, including weekend shifts, to calculate the extent of the underpayment.

Consequently, the Court ordered Corioliss to pay pecuniary penalties for the contraventions and to rectify the underpayments to the employee, including the recovery of outstanding wages and entitlements.

Orders