Fair Work Ombudsman v Kentwood Industries Pty Ltd (No 2)

In the case of Fair Work Ombudsman v Kentwood Industries Pty Ltd (No 2), the Fair Work Ombudsman brought proceedings against Kentwood Industries Pty Ltd and its director, Mr Zhang, for breaches of the National Employment Standards (NES) and the National Australian Processing Standard (NAPS) under the Fair Work Act 2009. The breaches included underpayments to Chinese employees who were on a Subclass 457 visa and sponsored by Kentwood. The employees were promised certain terms of employment in China, but upon arrival in Australia, they found that the written agreements provided to them were different and did not reflect the oral agreements made prior to their arrival.

The court had to determine the appropriate rate of interest for pre-judgment and post-judgment periods and the penalties to be imposed on Kentwood and Mr Zhang for the contraventions. The Fair Work Act sets out the prescribed rates for interest, which are 6% above the cash rate published by the Reserve Bank of Australia. The court found that a higher rate post-judgment serves as an incentive for satisfying the judgment, while a lower rate should be considered for pre-judgment interest due to variables that may not be the judgment debtor's responsibility.

Regarding penalties, the court followed a structured approach in determining the appropriate penalty for each contravention. The court considered each contravention of the NES and NAPS as separate contraventions but also allowed for the possibility of treating multiple contraventions as a single contravention if they arose out of a course of conduct. The maximum penalty for a body corporate like Kentwood was 300 penalty units, and for an individual like Mr Zhang, it was 60 penalty units. The court then considered the appropriate penalty for each contravention, taking into account the circumstances of the case and any common elements among the contraventions. Finally, the court reviewed the aggregate penalty to ensure it was an appropriate response to the conduct leading to the contraventions.

In conclusion, the court ordered Kentwood and Mr Zhang to pay penalties for the contraventions, as well as declarations, orders to remedy the detriment suffered by the employees, pre-judgment interest, and costs. The specific amounts and rates of interest were determined based on the court's findings and the provisions of the Fair Work Act.