FEDERAL COURT OF AUSTRALIA
Fair Work Ombudsman v Lam [2021] FCA 205
File number: NSD 1001 of 2019 Judgment of: PERRAM J Date of judgment: 11 March 2021 Catchwords: INDUSTRIAL LAW – application for declarations and pecuniary penalties for breaches of Fair Work Act 2009 (Cth) and Miscellaneous Award 2010 (Cth) – where Respondents employed domestic worker and nanny – quantum of penalties Legislation: Evidence Act 1995 (Cth) s 144
Fair Work Act 2009 (Cth) Pt 2-3, ss 44, 45, 48, 62, 90, 535, 536, 545, 550, 557
Miscellaneous Award 2010 (Cth) cll 4.1, 4.2, 14.1, 22.1, 22.3
Cases cited: 4 yearly review of modern awards – Miscellaneous Award 2010 [2020] FWCFB 754; 292 IR 373
Australian Securities and Investments Commission v Australian Property Custodian Holdings Limited (Receivers and Managers appointed) (in liquidation) (Controllers appointed) [2014] FCA 1308; 322 ALR 45
Division: Fair Work Division Registry: New South Wales National Practice Area: Employment and Industrial Relations Number of paragraphs: 28 Date of hearing: 1 September 2020 Counsel for the Applicant: Ms G Walker Solicitor for the Applicant: Office of the Fair Work Ombudsman Counsel for the Respondents: Mr D Chin SC with Mr T Liu Solicitor for the Respondents: Bartier Perry Lawyers ORDERS
NSD 1001 of 2019 BETWEEN: FAIR WORK OMBUDSMAN
Applicant
AND: KIT ANTHONY LAM
First Respondent
MING WEI TONG
Second Respondent
ORDER MADE BY:
PERRAM J
DATE OF ORDER:
11 MARCH 2021
THE COURT ORDERS THAT:
1.The parties bring in short minutes of order to give effect to these reasons within 7 days.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
PERRAM J:
The Applicant, the Fair Work Ombudsman (‘FWO’), seeks declarations against, and the imposition of pecuniary penalties upon, the Respondents, Mr Lam and Ms Tong. Mr Lam and Ms Tong were at the times relevant to this case married with two young children. They lived as a family near Haymarket in Sydney. On 3 May 2016 Mr Lam employed Ms Romero as the family’s domestic worker and nanny. Ms Romero ceased working for Mr Lam (and the family) on 2 May 2017 and so worked for him for exactly a year. During that year, Mr Lam paid into Ms Romero’s bank account in the Philippines as wages an amount in Philippine pesos equivalent to $12,574.39.
It is now accepted by Mr Lam and Ms Tong that Ms Romero’s employment was, in fact, governed by the Miscellaneous Award 2010 (Cth) (‘the Award’). When regard is had to all of the hours worked by Ms Romero and the terms of the Award the parties agree that Mr Lam ought to have paid her an amount equivalent to $105,809.72. There was therefore an underpayment by Mr Lam of some $93,235.33.
On 19 June 2019 the FWO commenced proceedings in this Court under the provisions of the Fair Work Act 2009 (Cth) (‘the Act’) seeking orders that Mr Lam pay Ms Romero the sum of the…
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- Fair Work Ombudsman v Lam [2021] FCA 205
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- [2021] FCA 205
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CaseChat Overview and Summary
The court found that Ms Lam, one of the respondents, was knowingly involved in requiring Ms Romero to work more than 38 hours per week, which constituted a contravention of section 44(1) of the Fair Work Act. Under section 550, knowingly being involved in another's contravention is treated as contravening the provision. Therefore, Ms Lam was also in breach, with a maximum penalty of $10,800. Given the similar circumstances, the court imposed a penalty of $5,000 on Ms Lam, the same as that imposed on Mr Lam. The court granted declaratory relief for contraventions of the Act that did not depend on the application of the Award, but did not grant relief for those that did. It ordered Mr Lam to pay a pecuniary penalty of $32,500 and Ms Lam to pay $5,000 within 28 days. The court also ordered Mr Lam to undergo online training as part of his consent to an order under section 545.
The final orders required the parties to bring in short minutes of order to give effect to the court's reasons within seven days. This included the payment of the specified penalties and the completion of the online training by Mr Lam. The decision underscores the importance of adhering to employment laws and the potential penalties for non-compliance.
Orders
Orders of the court
1. The parties bring in short minutes of order to give effect to these reasons within 7 days.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
Full text does not contain this section.
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
Ratio Decidendi
Legal Principle Established
Mr Lam and Ms Tong, of course, agree that the Award applied to Ms Romero’s employment. Given the potential complexities of the question and its uncertain outcome, it was sensible for them to agree that the Award did apply. However, their agreement does not provide a basis for the Court declaring to be correct a particular legal proposition when the evidence before the Court does not justify that conclusion and where the proposition may be legally contestable.DECLARATIONS OF CONTRAVENTION AND PENALTIES Having concluded that the Court ought not to declare that the Award applied to Ms Romero’s employment, I am unable to see how it can sensibly declare Mr Lam to have contravened the Act where the contravention alleged is founded on the application of the Award either, for example, a declaration that Ms Romero was not paid the correct wage. A declaration of such a contravention would carry with it a necessary implication of the anterior application of the Award. On the other hand, I see no reason why the Court ought not to grant declaratory relief in relation to those contraventions of the Act which do not depend on the application of the Award. Mr Lam admits eight sets of contraventions of the Act as follows:(i)Contraventions of s 45 of the Act in failing to comply with a term of an award (being a failure to pay Ms Romero the minimum wage specified in cl 14.1 of the Award);(ii)Contraventions of s 45 in failing to comply with a term of an award (being a failure to pay Ms Romero penalty rates for work performed outside the hours of 7 am to 7 pm specified in cl 22.3(a) of the Award);(iii)Contraventions of s 45 in failing to comply with a term of an award (being a failure to pay Ms Romero the overtime specified in cl 22.1 of the Award);(iv)Contraventions of s 45 in failing to comply with a term of an award (being a failure to pay Ms Romero penalty rates for work performed on public holidays as required by cl 22.3(e) of the Award);(v)Contraventions of s 44(1) in failing to comply with the National Employment Standards (being a failure to pay accrued annual leave on termination contrary to s 90(2));(vi)Contraventions of s 44(1) in failing to comply with the National Employment Standards (by unreasonably requiring Ms Romero to work more than 38 hours per week contrary to s 62(1));(vii)Contraventions of s 535(1) in failing to make and keep prescribed records; and(viii)Contraventions of s 536(1) in failing to provide Ms Romero with pay slips. I am satisfied that Mr Lam did contravene each of the provisions just set out on many occasions. For example, each time Mr Lam underpaid Ms Romero he committed a fresh contravention of s 45. Each of the eight sets of contraventions represents therefore a single course of conduct under s 557 (ie there are 8 courses of conduct). Section 557 requires each course of conduct to be treated as a single contravention. Further, in terms of assessing any penalty, I am also satisfied that the wrongdoing implied by each of the courses of conduct will be adequately addressed if each course of conduct were treated as if it were a single contravention. I do not think the penalty needs to be set with a view to deterring Mr Lam from future contraventions because I am quite satisfied that he will not contravene again. However, cases such as this do require the penalty to be set with a view to deterring others who might otherwise be tempted to contravene the Act.