Fair Work Ombudsman v Hu (No 2)

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FEDERAL COURT OF AUSTRALIA

Fair Work Ombudsman v Hu (No 2) [2018] FCA 1034

File number: QUD 708 of 2016
Judge: RANGIAH J
Date of judgment: 12 July 2018
Catchwords: INDUSTRIAL LAW – alleged contraventions of s 45 of the Fair Work Act 2009 (Cth) – piecework workers under Award – whether piecework rates enabled employees to earn minimum hourly rate – whether respondents were knowingly involved in contraventions by another entity – consideration of essential elements of contraventions – where not proved that respondents knew that employees were casual employees – respondents were not knowingly involved in contraventions
Legislation:

Corporations Act 2001 (Cth)

Evidence Act 1995 (Cth) ss 56, 60 and 140

Fair Work Act 2009 (Cth) ss 21, 45, 134, 138, 550 and 793

Workplace Relations Act 1996 (Cth) (repealed) s 576L
Cases cited:

ASIC v Rich (2004) 213 ALR 338

Australian Building and Construction Commissioner v Parker (2017) 266 IR 340

Australian Communications and Media Authority v Mobilegate Ltd A Company Incorporated in Hong Kong (No 8) [2010] FCA 1197

Australian Securities and Investments Commission v ActiveSuper Pty Ltd (in liq) (2015) 235 FCR 181

Banque Commerciale SA, En Liquidation v Akhil Holdings Limited (1990) 169 CLR 279

Briginshaw v Briginshaw (1938) 60 CLR 336

City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union [2006] FCA 813

Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australiav Australian Competition and Consumer Commission (2007) 162 FCR 466

Dare v Pulham (1982) 148 CLR 658 at 664;

Ex parte McLean (1930) 43 CLR 472

Fair Work Ombudsman v Al Hilfi [2012] FCA 1166

Fair Work Ombudsman v Devine Marine Group Pty Ltd [2014] FCA 1365

Fair Work Ombudsman v Grouped Property ServicesPty Ltd [2016] FCA 1034

Fair Work Ombudsman v South Jin Pty Ltd [2015] FCA 1456

Fitzgerald v FJ Leonhardt Pty Ltd (1997) 189 CLR 215

Gnych v Polish Club Ltd (2015) 255 CLR 414

Gore v Australian Securities and Investments Commission (2017) 249 FCR 167

Gould v Mount Oxide Mines (in liq) (1916) 22 CLR 490

Hamzy v Tricon International Restaurants (2001) 115 FCR 78

Jones v Dunkel (1959) 101 CLR 298

Potter v Fair Work Ombudsman [2014] FCA 187

Taylor’s Central Garages (Exeter) Ltd v Roper [1951] 2 TLR 284

Telum Civil (Qld) Pty Ltd v Construction, Forestry, Mining and Energy Union [2013] FWCFB 2434

Yorke v Lucas (1983) 49 ALR 672
Date of hearing: 9-11 and 25 October 2017
Date of last submissions: 9 November 2017 (Applicant)
13 November 2017 (Second and Third Respondents)
Registry: Queensland
Division: Fair Work Division
National Practice Area: Employment & Industrial Relations
Category: Catchwords
Number of paragraphs: 273
Counsel for the Applicant: Mr J Bourke QC with Ms A Coulthard
Solicitor for the Applicant: Fair Work Ombudsman
Counsel for the First Respondent: Mr R Brown (9–11 October 2017)
The First Respondent did not appear on 25 October 2017
Solicitor for the First Respondent: Johnsons Solicitors (9–11 October 2017)
Counsel for the Second and…
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Details
Case
[2018] FCA 1034
Decision Date

CaseChat Overview and Summary

Fair Work Ombudsman v Hu (No 2) concerns an action brought by the Fair Work Ombudsman against three respondents, alleging contraventions of section 45 of the Fair Work Act 2009. The dispute centres on whether piecework rates paid to employees were sufficient to meet the minimum hourly rate stipulated under the relevant award. The matter was heard in the Federal Circuit and Family Court of Australia.

The legal issues that the court had to address were whether the respondents were knowingly involved in the contraventions committed by HRS Country, an entity they controlled. This involved examining the essential elements of the alleged contraventions, including whether the respondents were aware that their employees were being paid at rates below the minimum hourly rate. The court had to determine if the respondents' involvement was knowing, given the evidence presented.

The court found that HRS Country did contravene the award in relation to employment agreements entered into between 7 February and 31 August 2014. However, it was not established that the respondents knew that their employees were casual employees, which was a critical element in determining their knowledge of the contraventions. As a result, the court concluded that the respondents were not knowingly involved in the contraventions. Consequently, the proceeding against the second and third respondents was dismissed.

The court ordered that the proceeding against the second and third respondents be dismissed. Additionally, the court noted that procedural orders would be required to facilitate the hearing of the Fair Work Ombudsman's application for declarations, penalties, and compensation against the first respondent.

Orders

Orders of the court

1. The proceeding against the second and third respondents is dismissed.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

Counsel for Ms Hu submitted that if it were found that HRS Country did not contravene cl 15 of the Award, Ms Hu’s admissions should be disregarded and the proceeding against her should be dismissed. That issue does not arise as I have found that HRS Country did contravene cl 15 in respect of employment agreements it entered after 7 February and before 31 August 2014, and it has not been necessary to make findings in respect of earlier agreements.Conclusion I have found that the Marland parties were not knowingly involved in HRS Country’s contraventions of s 45 of the FWA. Therefore, the proceeding must be dismissed against those parties. It will be necessary to make procedural orders to facilitate the hearing of the FWO’s application for declarations, penalties and compensation against Ms Hu.

Ratio Decidendi

Legal Principle Established

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