FEDERAL CIRCUIT COURT OF AUSTRALIA
| FAIR WORK OMBUDSMAN v MAHOMET | [2014] FCCA 1872 |
| Catchwords: INDUSTRIAL LAW – Penalty hearing – agreed contraventions of Fair Work Act – underpayment of wages – penalty rates – casual loading – failure to keep employee records and provide pay slips – statement of agreed facts – appropriate penalty. |
| Legislation: Fair Work Act 2009 (Cth) ss.45, 323, 536, 539, 545, 546, 547, 557 Evidence Act 1995 (Cth) s.191 Crimes Act 1914 (Cth) ss.4AA, 12 Crimes Legislation Amendment (Serious Drugs, Identity Crime and Other Measures) Act 2012 (Cth) |
| Murrihy v Betezy.com.au Pty Ltd (No.2) [2013] FCA 1146 McIver v Healey [2008] FCA 425 Kelly v Fitzpatrick (2007) 166 IR 14 |
| Applicant: | Fair Work Ombudsman |
| Respondent: | Vivien Mahomet (trading as Academy For Kids) |
| File Number: | MLG 936 of 2013 |
| Judgment of: | Judge O'Sullivan |
| Hearing date: | 15 September 2014 |
| Date of Last Submission: | 15 September 2014 |
| Delivered at: | Melbourne |
| Delivered on: | 15 September 2014 |
REPRESENTATION
| Counsel for the Applicant: | Mr Crick |
| Solicitors for the Applicant: | Fair Work Ombudsman |
| The Respondent: | In Person |
THE COURT DECLARES THAT:
Having regard to the admissions made in the Statement of Agreed Facts filed 17 April 2014 the Respondent contravened:
(a)section 45 of the Fair Work Act 2009 (Cth) (FW Act) by:
(i)failing to pay Priti Pandya (Pandya) the casually loaded rate of pay required by clause 10.5(a) of the Children’s Services Award 2010 (Modern Award) in the course of five fortnightly pay periods (Pay Periods) between 13 August 2012 and 9 November 2012;
(ii)failing to pay Ankita Mithsagar (Mithsagar) the casually loaded rate of pay required by clause 10.5(a) of the Modern Award in the course of the Pay Periods between 23 July 2012 and 31 August 2012;
(b)section 45 of the FW Act by:
(i)failing to pay Kamalpreet Riyat (Riyat) an allowance required by clause 15.1 of the Modern Award of 1.91% of the standard rate of pay (as defined by the Modern Award) (broken shift allowance) for each day on which Riyat was required to work two shifts in one day (broken shift), on 53 occasions during the period between 10 September 2012 and 14…
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- Case
- [2014] FCCA 1872
- Decision Date
CaseChat Overview and Summary
The court was required to determine the appropriate penalty to be imposed on the respondent for the contraventions. In doing so, the court considered the extent to which the respondent had demonstrated contrition, taken corrective action, and cooperated with the authorities during the investigation and proceedings.
Justice O'Sullivan noted that the respondent provided limited cooperation during the initial investigation period, failing to participate in a recorded interview or comply with a Notice to Produce. While the respondent later admitted to the contraventions and consented to an amended statement of claim after proceedings commenced, which saved costs, the court found no evidence of corrective action or genuine remorse. The court applied the principles from *Mornington Inn*, stating that a discount for cooperation should be reserved for cases where an admission indicates acceptance of wrongdoing and a willingness to facilitate justice, rather than simply avoiding a contested trial.
The applicant submitted that a 10% discount on penalty was appropriate, reflecting the respondent's admissions and subsequent cooperation. The court incorporated this discount into the proposed penalty ranges.
Orders
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Background
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Evidence
Evidence Before The Court
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Ratio Decidendi
Legal Principle Established
In written submissions the applicant contended:“Contrition, corrective action, cooperation with authoritiesCooperation with authorities 85.The Respondent provided limited co-operation to the Office of the Applicant during the investigation period, being the period between 7 January 2013 and 26 June 2013. She did not participate in a recorded interview regarding the allegations and did not comply with the NTP. The Applicant attempted to contact the Respondent on at least 15 occasions during that time, including by sending not less than four emails and six letters, making six telephone calls (leaving detailed voicemail messages on five occasions and speaking to the Respondent once) and conducting a site visit. The majority of attempts were met with no response or reply from the Respondent. [33][33] SOAF [100] to [118].86.Once proceedings were commenced, it was necessary for the Applicant to: (a)obtain an order for substituted service, as service was difficult to effect on the Respondent;[34][34] Refer to the Application in a Case and supporting materials filed by the Applicant on 17 September 2013, and the Orders of Judge O’Sullivan, made in this proceeding on 18 September 2013.(b)make an application for default judgment (notwithstanding that application was subsequently discontinued as a result of the Respondent’s admissions);[35] and [35] SOAF [126] and [134].(c)file an amended statement of claim, to account for fresh information contained in pay records provided by the Respondent in November and December 2013 which ought properly to have been produced in compliance with the NTP (although it is noted that the amended statement of claim was filed by consent of the Respondent).[36][36] SOAF [135].87.The Applicant acknowledges that the Respondent has demonstrated co-operation to enable this matter to proceed by statement of agreed facts, with the Respondent admitting to the alleged contraventions after these proceedings were commenced. The Respondent’s admissions, and her consent to the filing of an amended statement of claim, have saved considerable costs to the public purse by avoiding the need for a fully contested hearing and providing a more efficient use of Court resources.Corrective action 88.There is no evidence before the Court of any steps taken by the Respondent to prevent further contraventions.Contrition89.There is no evidence that the Respondent has made any apology to the Employees, or has expressed any regret or genuine remorse.[37][37] See Fair Work Ombudsman v Bound for Glory Enterprises & Anor [2014] FCCA 432 per O’Sullivan J, where the Court noted at [99] the respondent’s general lack of co-operation, which hamstrung the Applicant’s ability to confirm the affected employees’ entitlements, and prevented the Court finding that the respondents were genuinely remorseful.Discounts for Contrition, Corrective Action and Co-operation90.Where respondents co-operate and make admissions early in the course of an investigation or soon after the commencement of proceedings, it is appropriate to allow a discount of penalty (in the criminal jurisdiction, the maximum discount for this factor is “sometimes thought to be 25%”).[38] In considering the application of a penalty discount for co-operation and contrition, the statements of Stone and Buchanan JJ in Mornington Inn are apposite:[38] Mornington Inn at [75] per Stone and Buchanan JJ.“…a discount should not be available simply because a respondent has spared the community the cost of a contested trial. Rather, the benefit of such a discount should be reserved for cases where it can be fairly said that an admission of liability:(a)has indicated an acceptance of wrongdoing and a suitable and credible expression of regret; and/or(b)has indicated a willingness to facilitate the course of justice.”91.Whilst the Respondent has made admissions and co-operated with the Applicant in the proceeding to a point, the Applicant holds concern about the extent to which the Respondent’s co-operation answers the description of Stone and Buchanan JJ extracted above.[39] Specifically, and in addition to the matters already set out in paragraphs 0 and 0 above:(a)the co-operation was not offered at the earliest opportunity, and came only after the Applicant was put to the expense of making an application for default judgment;[40] 92.The Applicant submits that a discount of 10% on penalty is appropriate in this case.[41] The Applicant has incorporated that discount into the proposed penalty ranges set out in Attachment A.”[39] Noting the observations of Judge Jarrett in Fair Work Ombudsman v VS Investment Group Pty Ltd & Anor [2013] FCCA 208 at [38] to [45].[40] SOAF [121] to [126].[41] Cf. Fair Work Ombudsman v Australia China Trading Investment Consultancy Group Pty Ltd & Anor [2014] FCCA 407 at [76] to [78]; [93].