Fair Work Ombudsman v Golden Vision Food and Beverage Services Pty Ltd
[2017] FCCA 534
•21 March 2017
FEDERAL CIRCUIT COURT OF AUSTRALIA
| FAIR WORK OMBUDSMAN v GOLDEN VISION FOOD AND BEVERAGE SERVICES PTY LTD & ANOR | [2017] FCCA 534 |
| Catchwords: INDUSTRIAL LAW – Application for imposition of pecuniary penalties – consideration of penalty – non-payment of award entitlements – where single employee was underpaid – adverse action – threats to terminate employment where query made as to pay rates – employment terminated – misrepresentation as to binding effect of industrial award. |
| Legislation: Fair Work Act 2009 (Cth), ss.44, 45, 90, 117, 323(1), 340, 345, 550(1), 557(1) Hospitality Industry (General) Award 2010, cls. 20.1, 26.1, 32.1, 32.3, 33.3, 33.3, 34.1 |
| Cases cited: Fair Work Ombudsman v Total Project Marketing Pty Ltd (in Liquidation) & Ors [2014] FCCA 451 Pearce v The Queen [1998] HCA 57 Rocky Holdings Pty Ltd v Fair Work Ombudsman (2014) 221 FCR 153 |
| Applicant: | FAIR WORK OMBUDSMAN |
| First Respondent: | GOLDEN VISION FOOD AND BEVERAGE SERVICES PTY LTD |
| Second Respondent: | JIA NING WANG |
| File Number: | BRG 182 of 2016 |
| Judgment of: | Judge Jarrett |
| Hearing date: | 16 March 2017 |
| Date of Last Submission: | 16 March 2017 |
| Delivered at: | Brisbane |
| Delivered on: | 21 March 2017 |
REPRESENTATION
| Counsel for the Applicant: | Mr Dwyer |
| Solicitors for the Applicant: | Office of the Fair Work Ombudsman |
| Counsel for the Respondents: | Mr Fronis |
| Solicitors for the Respondents: | Aston Lawyers |
ORDERS
THE COURT DECLARES THAT:
Zoe Hollinger was an employee of the First Respondent.
The First Respondent contravened the following provisions of the Fair Work Act2009 (Cth):
(a) s.45 of the Fair Work Act 2009 (Cth) by failing to pay Ms Hollinger the minimum hourly rate of pay for ordinary hours worked in accordance with clause 20.1 of the Hospitality Industry (General) Award 2010;
(b) s.45 of the Fair Work Act 2009 (Cth) by failing to pay Ms Hollinger a penalty for hours worked on Saturday in accordance with clause 32.1 of the Hospitality Industry (General) Award 2010;
(c) s.45 of the Fair Work Act 2009 (Cth) by failing to pay Ms Hollinger a penalty for hours worked on Sunday in accordance with clause 32.1 of the Hospitality Industry (General) Award 2010;
(d) s.45 of the Fair Work Act 2009 (Cth) by failing to pay Ms Hollinger the evening penalty for work performed between 7:00pm and Midnight, Monday to Friday in accordance with clause 32.3(a) of the Hospitality Industry (General) Award 2010;
(e) s.45 of the Fair Work Act 2009 (Cth) by failing to pay Ms Hollinger overtime in accordance with clauses 33.2(a) and 33.3(a)(ii) of the Hospitality Industry (General) Award 2010;
(f) s.44 of the Fair Work Act 2009 (Cth) by failing to pay Ms Hollinger annual leave in accordance with s.90 of the Fair Work Act;
(g) s.45 of the Fair Work Act 2009 (Cth) by failing to pay Ms Hollinger annual leave loading on termination of her employment in accordance with clause 34.2 of the Hospitality Industry (General) Award 2010;
(h) s.44 of the Fair Work Act 2009 (Cth) by failing to pay Ms Hollinger payment in lieu of notice of termination in accordance with s.117 of the Fair Work Act 2009 (Cth);
(i) s.45 of the Fair Work Act 2009 (Cth) by failing to pay Ms Hollinger weekly in accordance with clause 26.1 of the Hospitality Industry (General) Award 2010;
(j) s.323(1) of the Fair Work Act 2009 (Cth) by failing to pay Ms Hollinger’s wages in full;
(k) s.340 of the Fair Work Act 2009 (Cth) by taking unlawful adverse action against Ms Hollinger in two separate instances in the form of:
(i)the threat to terminate Ms Hollinger’s employment; and
(ii)the termination of Ms Hollinger’s employment; and
(l) s.345 of the Fair Work Act 2009 (Cth) by knowingly or recklessly making a false or misleading representation about Ms Hollinger’s workplace rights.
The Second Respondent was involved, within the meaning of that phrase as used in s.550 of the Fair Work Act 2009 (Cth) in each of the First Respondent’s contraventions set out in declaration (2) hereof.
THE COURT ORDERS THAT:
Pursuant to s.545(1) of the Fair Work Act 2009 (Cth) and/or s.545(2)(a) of the Fair Work Act 2009 (Cth) the First Respondent be restrained and an injunction hereby issues restraining the First Respondent, whether by its officers, agents or otherwise, from engaging in conduct that contravenes the Fair Work Act 2009 (Cth) and the Hospitality Industry (General) Award 2010.
Pursuant to s.545(1) of the Fair Work Act 2009 (Cth) and/or s.545(2)(a) of the Fair Work Act 2009 (Cth) the Second Respondent be restrained and an injunction hereby issues restraining the Second Respondent from:
(a)aiding, abetting, counselling, procuring, or
(b)being in any way directly or indirectly knowingly concerned in conduct that contravenes the Fair Work Act 2009 (Cth) and Hospitality Industry (General) Award 2010.
Pursuant to s.546(1) of the Fair Work Act 2009 (Cth), the First Respondent pay penalties totalling $51,830 in respect of each of the contraventions the subject of the within declarations;
Pursuant to s.546(1) of the Fair Work Act 2009 (Cth), the Second Respondent pay penalties totalling $20,366 in respect of his involvement in each of the contraventions the subject of the within declarations;
Each of the First and Second Respondents pay the said penalties to the Commonwealth within 28 days of the date of this order, or within such other time as might be agreed.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT BRISBANE |
BRG 182 of 2016
| FAIR WORK OMBUDSMAN |
Applicant
And
| GOLDEN VISION FOOD AND BEVERAGE SERVICES PTY LTD |
First Respondent
| JIA NING WANG |
Second Respondent
REASONS FOR JUDGMENT
Zoe Hollinger was employed by Golden Vision Food and Beverage Services Pty Ltd between 2 December, 2014 and 15 December, 2014 as a waitress in Golden Vision’s Restaurant, Fire and Stone, at Tangalooma Island Resort, Moreton Island, Queensland. Ms Hollinger is citizen of the United States of America who held a higher education visa and was in Australia for the purposes of furthering her tertiary education. At the relevant time she was 21 years of age.
Jia Ning Wang is and was at the relevant times, the sole director and sole shareholder of Golden Vision. He was responsible for the overall management of the affairs of Golden Vision’s business. He is an experienced businessman, knowledgeable and experienced regarding the general application of industrial awards to employees. He holds a Masters qualification in Management. He was familiar with the relevant award in this case – the Hospitality Industry (General) Award 2010. He had been involved in dealing with the applicant in the past concerning employees of the first respondent and the first respondent’s employment practices.
The circumstances in which Mr Wang caused Ms Hollinger to be engaged by Golden Vision and her subsequent treatment by the respondents when she worked in Golden Vision’s business led to Ms Hollinger making a complaint to the Fair Work Ombudsman about those matters. The Fair Work Ombudsman investigated Ms Hollinger’s complaints and these proceedings are the result of her investigations.
Both respondents now agree that they have breached the Fair Work Act 2009 (Cth) in the respects that I have discussed more fully below. The respondents agree to the imposition of pecuniary penalties upon them for those contraventions. These reasons relate to the penalties that ought to be imposed upon the respondents for the admitted contraventions.
For the reasons that follow, I have determined that penalties totalling $51,830 for Golden Vision and $20,366 for Mr Wang are appropriate.
Background
In or around November 2014, Mr Wang offered Ms Hollinger a position as a waitress with Golden Vision. Subsequently, Mr Wang made arrangements for Ms Hollinger to be issued with a staff number and to travel by boat from Brisbane to Tangalooma Island.
Upon arriving at Tangalooma Island on 1 December 2014, Ms Hollinger was met by Pei Yuan Xiang (Ryan) on behalf of Golden Vision, who showed her the Restaurant, and gave her a roster setting out the hours she was to work. Ms Hollinger was also provided with, and signed, an Accommodation Agreement (which provided her with accommodation on Tangalooma Island while working at the Restaurant in exchange for a fee to be deducted from her wage).
Ms Hollinger commenced work on 2 December, 2014 in accordance with the roster given to her by Ryan and continued to work until 15 December 2014. During this period, Ms Hollinger worked a total of 69.75 hours.
Golden Vision did not, at any time during Ms Hollinger’s employment, pay her for this work. The parties agree that during her employment, Mr Wang provided Ms Hollinger with two written forms of employment contract with Golden Vision.
Ms Hollinger refused to sign either written form of contract on the basis that the amounts offered for her remuneration were less than the minimum wage. In particular:
a)In the first contract, given to Ms Hollinger by Mr Wang on 8 December, 2014 the first respondent offered to pay Ms Hollinger $20 per hour; and
b)the second contract, emailed to Ms Hollinger by Mr Wang on 14 December, 2014 (after Ms Hollinger made a further enquiry on 12 December, 2014), stated that Ms Hollinger would be paid a full time salary of $760 per week.
On 15 December, 2014 Ms Hollinger emailed Mr Wang to make several enquiries about the second contract, including the rate of remuneration and whether she would be required to work in excess of 38 hours per week without pay.
On or about 16 December, 2014 in response to this email, Mr Wang contacted Ms Hollinger during her shift, asking her not to work until she had signed an employment contract. Ms Hollinger was effectively stood down. Ms Hollinger complied and later that day, she and Mr Wang had a conversation in Mr Wang’s office.
An agreed transcript of that conversation forms part of the Statement of Agreed Facts to which the parties have agreed. The respondents admit that, during this conversation, Ms Hollinger made enquires with Mr Wang about the minimum wage and her employment and that Mr Wang made statements to her about the minimum wage and about her employment.
The respondents admit that, during the conversation, Mr Wang:
a)made statements which amounted to a threat to terminate Ms Hollinger’s employment if she did not agree to the terms offered;
b)made various statements to Ms Hollinger about the applicable award and minimum legal requirements, including that the applicable award “is just a guideline”, and that $20 per hour was the standard minimum wage across the industry.
After talking with Ms Hollinger Mr Wang sent a text message to her on 19 December, 2014 in which he stated that the employment “was not working out” and that “technically you don’t work for us”. The respondents admit that Ms Hollinger’s employment was terminated by that text message.
On 30 December, 2014 approximately 11 days after her employment ended, Ms Hollinger sent an email to Mr Wang requesting payment of the money she believed she was entitled to be paid during her employment. She provided her bank details and requested payment of $2,811.57 ($2,567.64 for wages and $243.93 for superannuation).
Mr Wang replied to Ms Hollinger by email on 2 January, 2015 arguing that Ms Hollinger had overstated her entitlement and suggesting that she was owed $1,345.90. Despite the clear acknowledgment that Ms Hollinger was owed something, she was not paid any amount at all by the respondents until 14 December, 2015, almost one year later and after the applicant had issued the respondents with a Findings of Contravention letter dated 27 November, 2015.
Contraventions
On the basis of the facts set out above, Golden Vision admits contravening the following provisions:
a)s.45 of the Fair Work Act by failing to pay Ms Hollinger the minimum hourly rate of pay for ordinary hours worked in accordance with clause 20.1 of the Hospitality Award;
b)s.45 of the Fair Work Act by failing to pay Ms Hollinger a penalty for hours worked on Saturday in accordance with clause 32.1 of the Hospitality Award;
c)s.45 of the Fair Work Act by failing to pay Ms Hollinger a penalty for hours worked on Sunday in accordance with clause 32.1 of the Hospitality Award;
d)s.45 of the Fair Work Act by failing to pay Ms Hollinger the evening penalty for work performed between 7:00pm and Midnight, Monday to Friday in accordance with clause 32.3(a) of the Hospitality Award;
e)s.45 of the Fair Work Act by failing to pay Ms Hollinger overtime in accordance with clauses 33.2(a) and 33.3(a)(ii) of the Hospitality Award;
f)s.44 of the Fair Work Act by failing to pay Ms Hollinger annual leave in accordance with s.90 of the Fair Work Act;
g)s.45 of the Fair Work Act by failing to pay Ms Hollinger annual leave loading on termination of her employment in accordance with clause 34.2 of the Hospitality Award;
h)s.44 of the Fair Work Act by failing to pay Ms Hollinger payment in lieu of notice of termination in accordance with s.117 of the Fair Work Act;
i)s.45 of the Fair Work Act by failing to pay Ms Hollinger weekly in accordance with clause 26.1 of the Hospitality Award;
j)s.323(1) of the Fair Work Act by failing to pay Ms Hollinger’s wages in full:
k)s.340 of the Fair Work Act by taking unlawful adverse action against Ms Hollinger in two separate instances in the form of:
i)the threat to terminate Ms Hollinger’s employment; and
ii)the termination of Ms Hollinger’s employment; and
l)s.345 of the Fair Work Act by knowingly or recklessly making a false or misleading representation about Ms Hollinger’s workplace rights.
Two or more contraventions of the Fair Work Act may, depending upon the particular circumstances of the case, attract the operation of s.557(1) of the Act. By that subsection the Court must treat multiple contraventions of certain civil penalty provisions of the Act as a single contravention if the contraventions are committed by the same person and they arose out of a course of conduct by that person.
Section 557(1) is engaged in this case. Leaving aside the contraventions of ss.323(1), 340 and 345 of the Act, each of the remuneration related contraventions involve multiple contraventions of each provision. The contraventions were committed by the same entity, namely Golden Vision. If they arose out of the same course of conduct by Golden Vision, they must be taken to constitute a single contravention. That is the legislatively mandated outcome.
There can be no doubt that the contraventions all arose out of a course of conduct described compendiously as the employment of Ms Hollinger by Golden Vision. However, as the decision in Rocky Holdings Pty Ltd v Fair Work Ombudsman (2014) 221 FCR 153 directs, s.557(1) does not operate so as to consolidate into a single contravention, multiple contraventions of s.45 (or s.44) of the Act where those contraventions are based upon breaches of different terms or obligations in an Award or (in the case of s.44 the National Employment Standards). Section 557(1) of the Act will operate to consolidate multiple contraventions of the same term or obligation in an Award, but it will not operate across different terms or obligations.
The parties are agreed, and I accept, that the application of s.557(1) of the Fair Work Act results in the following contraventions for the purposes of these proceedings:
No. Provision contravened Number of contraventions Before s.557 application After s.557 application 1 s 45: failure to pay minimum wage (cl 20.1 Hospitality Award) 2 1 2 s 45: failure to pay Saturday rates (cl 32.1 Hospitality Award) 2 1 3 s 45: failure to pay Sunday rates (cl32.1 Hospitality Award) 2 1 4 s 45: failure to pay evening rates (cl32.3(a) & 33.3(a)(ii) Hospitality Award) 2 1 5 s 45: failure to pay overtime (cl 32.3(a)& 33.3(a)(ii) Hospitality Award) 2 1 6 s 44: failure to pay annual leave (s 90 FW Act) 1 1 7 s 45: failure to pay annual leave loading (cl 34.2 Hospitality Award) 1 1 8 s 44: failure to pay notice on termination (s 117 FW Act) 1 1 9 s 45: failure to pay weekly (cl 26.1 Hospitality Award) 2 1 10 s 323: failure to pay wages in full 2 1 11 s 340: adverse action by threatening to terminate Ms Hollinger’s employment on 16 December 2014 1 1 12 s 340: adverse action by terminating Ms Hollinger’s employment on 19 December 2014 1 1 13 s 345: making a false or misleading misrepresentation about Ms Hollinger’s workplace rights 1 1
Both parties acknowledge that the authorities reveal that to the extent to which any two contraventions of which a person stands convicted contain common elements, it would be wrong to punish that person twice for the commission of the elements that are common: see Pearce v The Queen [1998] HCA 57 at [40]; Fair Work Ombudsman v Total Project Marketing Pty Ltd (in Liquidation) & Ors [2014] FCCA 451 at [84].
The parties, however, differ in the application of that principle in the present case.
The applicant argues that the respondents’ contraventions of ss. 44 and 45 of the Fair Work Act for failure to pay Ms Hollinger’s annual leave on termination and the failure to pay annual leave loading respectively have sufficient overlap to have a common element. However, the applicant submits that no further reduction in the number of contraventions in respect of the underpayment contraventions should be made because they “arise from the failure to pay different entitlements”. Thus, on the applicant’s approach the total number of contraventions would be reduced from 13 to 12.
The respondents submit that there is a common element to the first ten contraventions set out in the table above. They all relate to the remuneration to which Ms Hollinger was entitled. The common element is said to be the single decision by the respondents to not pay Ms Hollinger at all.
The respondents submit that the Court should take into account the commonality of contraventions of the first ten contraventions by imposing a larger penalty for one of the contraventions and a lessor or no penalty for others or to impose a lower penalty across the board for the contraventions, because:
a)those contraventions arose out of the one decision of the respondents, to not pay Ms Hollinger at all;
b)the contraventions relate to the one employee over only a two-week period; and
c)some of the contraventions arise out of only very small underpayments – as little as $16.87.
I will deal with the approach I intend to take in this case later in these reasons when fixing the appropriate penalties.
Consideration of Penalty
Maximum penalties
The maximum penalties that could be imposed on the respondents are identified by the applicants as:
a)$51,000 for Golden Vision in respect of each identified contravention; and
b)$10,200 for Mr Wang in respect of each identified contravention.
On the basis of the applicant’s approach that there are 12 contraventions to be dealt with for each Respondent, the maximum penalty that might be imposed on Golden Vision is $612,000 and the maximum that might be imposed on Mr Wang is $122,400.
Relevant matters
A principal object of the Fair Work Act is the preservation of an effective safety net for employee entitlements and effective enforcement mechanisms. Compliance with minimum standards is vital to the fundamental objects of the Fair Work Act.
The contraventions admitted by the respondents involved a complete failure to pay Ms Hollinger at all, which is a significant failure to adhere to the minimum standards of the Fair Work Act. To compound this conduct, the respondents took adverse action against Ms Hollinger (in the form of threatening to terminate her employment and later terminating her employment) because of her request to be paid her minimum entitlements.
The applicant submits that the admitted contraventions in this matter are serious. I agree. While Ms Hollinger worked for the respondent for a relatively short period (2 December to 15 December 2014), she performed over 69.5 hours of work during that time and was not paid at all until more than 12 months after the end of her employment. During that time, Golden Vision had the full benefit of those funds to which Ms Hollinger was entitled.
The respondents conduct in taking adverse action against Ms Hollinger after she sought to negotiate with the second respondent in relation to the second form of written contract is more serious. The transcript of the conversation between Ms Hollinger and the second respondent from which these contraventions arise reveals a blatant attempt by Mr Wang to convince Ms Hollinger that the award had very little relevance to her employment, was nothing more than a guideline and that industry practice governed her pay rates. He was, at the time, an experienced and qualified businessperson and the sole director and shareholder of Golden Vision. He was involved in the overall operations and management of affairs of Golden Vision. He was knowledgeable and experienced regarding the general application of industrial awards in respect of employees.
Nonetheless, the transcript reveals that his conduct was misleading and designed to be so. His subsequent termination of her employment because she insisted on proper payment is also very serious and represents the respondents taking advantage of the difference in the parties’ bargaining position and power.
The applicant submits that at the time of the contraventions, Ms Hollinger was a 21 year old student visa holder and that whilst she took proactive steps to educate herself about her rights, “as a young person from a foreign country seeking unskilled work”, she should not be considered “any less vulnerable”. If the submission is intended to suggest that Ms Hollinger was a member of a “vulnerable class of employees” as is sometimes suggested by the applicant, I accept that she was a member of such a class and that it is open to infer that initially the second respondent sought to take advantage of that. However, laudably Ms Hollinger revealed herself to be very proactive and effective in looking out for her own interests. The second respondent’s attempts to take advantage of her youth and her status as a visitor to this country were ineffective. I take those matters into account.
The respondents admit to underpaying Ms Hollinger, and further admit that the value of the underpayment was $1,963.43. Ms Hollinger was paid no money at all during her two week period of employment with Golden Vision. The respondents had the use of her remuneration. Ms Hollinger deposed that she found it “mentally exhausting” spending a year following up payment owed to her.
Furthermore, Ms Hollinger’s attempt during the Employment Period to ensure she was paid her minimum wage (both an exercise of her right to be paid correctly and her right to make the enquiries) resulted in the termination of her employment. Ms Hollinger deposes that, after her conversation with Mr Wang on 16 December 2014, “I left the restaurant and I called my mom in tears because I didn’t want to lose my job for doing the right thing and standing up for myself and my rights.”
The respondents should be left in doubt that its conduct and treatment of Ms Hollinger was an extremely serious contravention of Australian workplace laws.
The present contraventions took place against a background where:
a)Mr Wang had received a determination of contravention letter from the applicant and was the subject of four previous complaints made to the applicant in July, 2014;
b)in May to August, 2011 Mr Wang represented Red Vision Pty Ltd in communications with the applicant in his capacity as Director of Red Vision. The applicants wrote to Mr Wang and advised that Red Vision had contravened the Restaurant Industry Award 2010. Nine contraventions of the Restaurant Industry Award 2010 were identified including: non-payment of shift allowance; failing to pay superannuation contributions; failing to give meal breaks, failing to pay overtime, non-payment of penalty rates for weekend and public holidays, failing to pay morning and evening penalties and non-payment of annual leave. The letter advised Mr Wang that he should take action to correct the contraventions and noted that a possible consequence of the contravention was enforcement action;
c)another complaint was received by the applicants in July, 2014 in respect of alleged underpayments, failing to provide pay slips and failing to provide meal breaks (amongst other things). Mr Wang was the main point of contact with the applicant’s inspectors in regards to this complaint.
I accept that the background I have just described demonstrates that Mr Wang was familiar with the need to ensure that the first respondent’s operations were conducted in accordance with the Fair Work Act. I accept that the previous interactions between the applicants, Golden Vision and Mr Wang demonstrate that the respondents were on notice of their obligations to comply with applicable laws and industrial instruments. Mr Wang must have known that there were significant consequences for contravening the Act. Despite that knowledge, he engaged in the conduct complained of in this case, which he must have known was a contravention of the Fair Work Act.
I think the background is also relevant because it demonstrates that Golden Vision or Mr Wang seems to have done little to change their business practices.
The affidavits of Mr Wang and of Pei Yuan Xiang (known as Ryan and referred to above) provide some insight as to Golden Vision’s size and profitability and Mr Wang’s income. However, an employer cannot be absolved of its legal responsibility to comply with the law in relation to the employment of its employees, regardless of the size of the business or its financial position. The financial capacity of the respondents, however, is relevant to the size of the penalty that might be imposed and the obligation to avoid a penalty that is likely to be oppressive or crushing and which reflects the objective seriousness of the conduct.
The parties suggest that the conduct of the first and second respondents was reckless. I do not understand that position. In my view, the conduct of the respondents that constitute the contraventions was plainly deliberate and calculated. It was deliberate in the sense that it was not for some 12 months later that the respondents rectified the non-payment of Ms Hollinger’s wages. I do not accept that the misrepresentations made by Mr Wang about the nature of the Award were reckless. The second respondent plainly knew from his earlier dealing with the applicant that there were industrial awards in place that governed the employment of people such as Ms Hollinger. Indeed she even told him about an Award and gave him her figures and calculations for remuneration pursuant to that Award.
That he Mr Wang admits that he did not obtain any assistance or legal advice in calculating the payment owed to Ms Hollinger is of no moment in my view. He knew that the Fair Work Act imposed obligations on the first respondent as an employer. If he chose not to seek out advice to assist Golden Vision to meet those obligations, that is a matter that tells against both respondents in this proceeding.
Both respondents have admitted to all contraventions alleged against them in these proceedings despite initially denying the contraventions when the proceedings were commenced in February, 2016. The respondents also denied that Ms Hollinger was employed by Golden Vision. The respondents’ denials did not turn into admissions until November, 2015. The parties agreed to a statement of agreed facts that was filed on 9 December, 2015.
I accept that there is some evidence of contrition and remorse on the part of the respondents, which has been expressed by Mr Wang in his affidavit, filed 16 January, 2017. However, despite knowing that Ms Hollinger was entitled to be paid some monies, there is no evidence that Mr Wang made any enquiries or sought any advice about the amount or took any steps to pay Ms Hollinger any amount at all in the intervening period. I take that into account.
Golden Vision rectified the non-payment to Ms Hollinger on 14 December, 2015 after a Fair Work Inspector issued a Findings of Contravention letter on 27 November, 2015 albeit, almost one year after the end of Ms Hollinger’s employment.
Mr Wang has set out in his affidavit relied upon for the purposes of this hearing that he and Golden Vision have taken certain steps to ensure compliance with workplace laws. Those steps are said to include “reading through” the Hospitality Award, seeking legal advice, and joining the Queensland Hotels Association. The applicant submits, and I accept, that the steps taken are the bare minimum. There is no evidence, for example, of the form in which the employment contracts used by Golden Vision in respect of its employees now take.
The applicant acknowledges that Mr Wang co-operated in the investigation by providing documents that were requested by the Fair Work Inspector, and in rectifying the underpayment after it was identified by the applicant.
Specific deterrence is important in this case. I reach that conclusion given that the respondents committed these contraventions after some significant engagement with the applicant in respect of other employees. Golden Vision continues to employ workers and Mr Wang remains in control of the business.
However, the impetus for specific deterrence is ameliorated somewhat as Mr Fronis for the respondent’s points out, because the respondents have only recently been dealt with by the Court in the previous decision to which I have referred earlier in these reasons. The Court imposed penalties in that case. Further, there have been no further complaints against the respondents after the present contraventions in December, 2014. Mr Wang gave evidence that “it has been extremely costly in terms of not just penalties but legal fees and the time investment spent in resolving these issues. The cost of court proceedings and penalties has [sic] been substantial and quite costly, far costlier then [sic] complying with the legislation”.
General deterrence is also important and is directed at ensuring that the penalty will act as a deterrent to others who might be likely to offend. The Respondent operates in the hospitality industry. I accept that general deterrence is a significant factor in this case.
The Penalties
This is not a case of underpayment of an employee’s entitlements. It is a case of the complete non-payment of Ms Hollinger’s earnings to her for a period of nearly 12 months after she completed the work.
Whilst the conversation between Ms Hollinger and Mr Wang on 16 December, 2014 centred on pay rates, there was no payment at all made by Golden Vision. It is inapt, in my view to speak of an underpayment in those circumstances. The contravention is constituted by the non-payment of the required remuneration as required by the Hospitality Award (cl.26.1 – failure to pay weekly) and the failure to pay remuneration in full: s.323 of the Fair Work Act).
However, the period over which that offending conduct occurred was very brief – a period of two weeks. In those circumstances I intend to impose one penalty for the contravention of s.45 of the Fair Work Act constituted by the first respondent’s failure to pay Ms Hollinger weekly and another penalty for the failure to pay Ms Hollinger’s remuneration in full. I do not intend to impose a penalty for the other wage related contraventions. The penalties for those contraventions will be subsumed into the two penalties that I shall fix.
For the first respondent, the penalty for the failure to pay Ms Hollinger weekly should be 33% of the maximum or $16,830. There should be a similar penalty (in percentage terms) for Mr Wang, namely $3,366.00.
I intend to deal with the remaining non-wage related contraventions separately. Each is significant and is constituted by different statements or actions on the part of the respondents.
Having regard to the matters I have discussed above, and making due allowance for the respondents’ cooperation with the applicant and in these proceedings, it seems to me that in respect of Golden Vision the following penalties are appropriate:
a)one penalty of $10,000 for the contravention of s.340(1) of the Fair Work Act constituted by the threat to terminate Ms Hollinger’s employment;
b)one penalty of $15,000 for the contravention of s.340(1) of the Fair Work Act constituted by the threat to terminate Ms Hollinger’s employment; and
c)one penalty of $10,000 for the contravention of s.345(1) of the Fair Work Act constituted by the misrepresentations concerning the operation of the Award.
The total penalty for Golden Vision is $51,830. I am not satisfied that the penalty requires further reduction to take account of the totality of the penalty and its effect upon Golden Vision. I have factored in a reduction in penalty of 5% in each of the amounts specified above to take account of the first respondent’s cooperation. In my view, no further reduction is warranted.
In respect of Mr Wang the following penalties are, in my view appropriate:
a)one penalty of $5,000 for the contravention of s.340(1) of the Fair Work Act constituted by the threat to terminate Ms Hollinger’s employment;
b)one penalty of $7,000 for the contravention of s.340(1) of the Fair Work Act constituted by the threat to terminate Ms Hollinger’s employment; and
c)one penalty of $5,000 for the contravention of s.345(1) of the Fair Work Act constituted by the misrepresentations concerning the operation of the Award.
The total penalty for the second respondent is $20,366. The percentage of the maximum penalty for Mr Wang is different to the percentage for Golden Vision. That is deliberate. It reflects the second respondent’s role as the mind behind Golden Vision. It is he who is ultimately responsible for these contraventions because it was his words, acts and decisions that constitute the contraventions. By reason of s.550(1) of the Fair Work Act, he is to be treated as if he committed the contraventions.
Again, I am not satisfied that the total penalty for the second respondent requires further reduction to take account of the totality of the penalty and its effect upon Mr Wang. I have factored in a reduction in penalty of 5% in each of the amounts specified above to take account of the second respondent’s cooperation. In my view, no further reduction is warranted.
In my view those penalties are an appropriate response to the conduct which led to the contraventions. On the evidence I do not consider that they are oppressive or crushing although it may take the respondents some time to acquit them. They are sufficient to mark the Court’s disapproval of the respondent’s conduct and serve as a warning to others that similar conduct can have serious consequences and ought not be repeated.
I make the orders set out at the commencement of these reasons.
I certify that the preceding sixty-five (65) paragraphs are a true copy of the reasons for judgment of Judge Jarrett delivered on 21 March, 2017.
Date: 21 March, 2017
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