Fair Work Ombudsman v Mamak Pty Ltd (in Liquidation)

FEDERAL CIRCUIT COURT OF AUSTRALIA

FAIR WORK OMBUDSMAN v MAMAK PTY LTD (IN LIQUIDATION) & ORS

[2019] FCCA 3582

Catchwords:
INDUSTRIAL LAW – Contraventions of the Fair Work Act 2009 (Cth) – contraventions of the FairWork Regulations 2009 (Cth) – admitted contraventions by each of the second, third and fourth respondents pursuant to s.550 of the Fair Work Act 2009 (Cth) – underpayment of wages – record-keeping and pay slips contraventions – whether taxation withheld or paid to employees – whether payroll advices were false or misleading – whether there was a course of conduct by the respondents in terms of s.557 of the Fair Work Act 2009 (Cth) – whether a penalty should be imposed for admitted contraventions – declarations made – ancillary orders made – no financial penalty.

Legislation:

Fair Work Act 2009 (Cth) ss.44, 45, 125, 535, 536, 545, 550, 557, 793

FairWork Regulations 2009 (Cth) reg.3.44

Corporations Act 2001 (Cth) s.500

Cases cited:

Fair Work Ombudsman v NSH North Pty Ltd trading as New Shanghai

Charlestown [2017] FCA 1301

Mason v Harrington Corporation Pty Ltd t/as Pangaea Restaurant & Bar

[2007] FMCA 7

Kelly v Fitzpatrick [2007] FCA 1080

Sharpe v Dogma Enterprises Pty Ltd [2007] FCA 1550

Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8

Fair Work Ombudsman v Mamak Pty Ltd & Ors [2016] FCCA 2104

Re: Australasian Meat Industry Employees Union v Meneling Station Pty

Limited [1987] FCA 4

Commonwealth of Australia v Director, Fair Work Building Industry

Inspectorate Construction, Forestry, Mining and Energy Union v Director, Fair

Work Building Industry Inspectorate [2015] HCA 46

Fair Work Ombudsman v Transpetrol TM AS [2019] FCA 400

Applicant:

FAIR WORK OMBUDSMAN

First Respondent:

MAMAK PTY LTD (ACN 118 546 857) (IN LIQUIDATION)

Second Respondent:

JOON HOE LEE

Third Respondent:

JULIAN LEE

Fourth Respondent:

ALAN WING-KEUNG AU

File Number:

SYG 1392 of 2017

Judgment of:

Judge Emmett

Hearing date:

1 April 2019, 29 May 2019, 30 July 2019

Date of Last Submission:

9 August 2019

Delivered at:

Sydney

Delivered on:

11 December 2019

REPRESENTATION

Counsel for the Applicant:

Ms Vanja Bulut

Solicitors for the Applicant:

Fair Work Ombudsman

Counsel for the Respondents:

Ms Deborah Dinnen

Solicitors for the Respondents:

Comasters Law Firm and Notary Public

FAIR WORK OMBUDSMAN v MAMAK PTY LTD (ACN 118 546 857) (IN LIQUIDATION) & ORS [2019] FCCA 3582

Index

A. Documents relied on

B. Admitted Contraventions

C. Industrial Instruments

D. Total Underpayments and Rectifications

E. Agreed Knowledge and Responsibilities of Respondents

F. Taxation Treatment and Payroll Advices

(i) Taxation Treatment of amounts paid to the Employees

(ii) Basis on which Payroll Advices were False or Misleading

G. Principles Relevant to Determination of Penalty

(i) Section 557 of the FW Act and Course of Conduct

(ii) Contrition

(iii) Cooperation

(iv) Deterrence

H. Conclusion

Declarations

Ancillary Orders

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT SYDNEY

SYG 1392 of 2017

FAIR WORK OMBUDSMAN

Applicant

And

MAMAK PTY LTD (ACN 118 546 857) (IN LIQUIDATION)

First Respondent

JOON HOE LEE

Second Respondent

JULIAN LEE

Third Respondent

ALAN WING-KEUNG AU

Fourth Respondent

REASONS FOR JUDGMENT

The proceeding before this Court concerns appropriate penalties for admitted contraventions of the Fair Work Act 2009 (Cth) (“the FW Act”) and the FairWork Regulations 2009 (Cth) (“the FW Regulations”) by each of the respondents in relation to two employees of the first respondent (“Mamak”), Ms Nur Faraha Natasha Binte Ibrahim and Mr Timothy Duncan Lee (“the Employees”).
On 2 March 2018, Mamak was placed in liquidation. The proceeding against Mamak is stayed by operation of s.500(2) of the Corporations Act 2001 (Cth).
The applicant (“the FWO”) seeks penalties against each of the second, third and fourth respondents pursuant to s.550 of the FW Act in relation to their admitted knowing involvement in Mamak’s contraventions.

A. Documents relied on

The FWO relied on the following evidence:
a)Affidavits of Xiaobing Wang – filed 26 April 2019, 17 May 2019.
b)Affidavits of Timothy Duncan Lee – filed 26 April 2019, 17 May 2019.
c)Affidavit of Nur Faraha Natasha Binte Ibrahim – filed 6 May 2019.
d)Exhibit 1A – Further Statement of Agreed Facts – filed 8 April 2019.
e)Exhibit 2A – Page 378 of Affidavit of James Gregory Robertson – filed 17 May 2019.
The respondents relied on the following evidence:
a)Affidavit of Alan Wing-Keung Au – filed 30 May 2019.
b)Affidavit of Joon Hoe Lee (Clement Lee) – filed 30 May 2019.
c)Affidavit of Julian Lee – filed 30 May 2019.
The FWO also relied on the Applicant’s Submissions on Penalty filed on 17 May 2019 and the FWO’s Submissions in Reply on Penalty filed 24 June 2019.
The respondents also relied on Submissions on Penalty filed on 24 May 2019.
Both parties relied on an Agreed Statement of Issues filed 9 August 2019.

B. Admitted Contraventions

The admitted contraventions are as follows:
“3. On the basis of the facts set out below, each of the Second, Third and Fourth Respondents admit to being involved, pursuant to section 550 of the FW Act, in Mamak's contraventions of the following civil remedy provisions of the FW Act and the FW Regulations in respect to Ms Nur Faraha Natasha Binte Ibrahim (Ms Ibrahim) and Mr Timothy Duncan Lee (Mr Timothy Lee) (collectively, the Employees):
(a) section 45 of the FW Act, by failing to pay each of the Employees the minimum rates of pay required by clauses 20.1 and A.2.5 of Schedule A to the Restaurant Industry Award 2010 (Restaurant Award);
(b) section 45 of the FW Act, by failing to pay each of the Employees the casual loading required by clauses 13.1 and A.5.4 of Schedule A to the Restaurant Award;
(c) section 45 of the FW Act, by failing to pay each of the Employees the Saturday penalty rates required by clause 34.1 of the Restaurant Award;
(d) section 45 of the FW Act, by failing to pay each of the Employees the Sunday penalty rates required by clauses 34.1 and A.7.3 of Schedule A to the Restaurant Award;
(e) section 45 of the FW Act, by failing to pay each of the Employees the public holiday penalty rates required by clause 34.1 of the Restaurant Award;
(f) section 45 of the FW Act, by failing to pay each of the Employees additional penalty, amounts for work performed between 10:00 pm and midnight on Monday to Friday as required by clauses 34.2 and A.7.3 of Schedule A to the Restaurant Award;
(g) subsection 535(1) of the FW Act, by failing to keep records that Mamak was required to keep under the FW Act and the FW Regulations for 7 years;
(h) subsection 536(2) of the FW Act, by failing to ensure that pay slips that it gave to the Employees included information prescribed by the FW Regulations;
(i) sub-regulation 3.44(1) of the FW Regulations, by making and keeping employee records in relation to Mr Timothy Lee's Employment Period, knowing that those records were false or misleading;
j) sub-regulation 3.44(1) of the FW Regulations, by making and keeping employee records in relation to Ms Ibrahim's Employment Period, knowing that those records were false or misleading;
(k) sub-regulation 3.44(6) of the FW Regulations, by making use of entries in the employee records in relation to Mr Timothy Lee's Employment Period, by providing those records to the offices of the Applicant on 3 June 2016, knowing that those records were false or misleading;
(l) sub-regulation 3.44(6) of the FW Regulations, by making use of entries in the employee records in relation to Ms Ibrahim's Employment Period, by providing those records to the offices of the Applicant on 24 November 2016, knowing that those records were false or misleading;
(m) subsection 535(2) of the FW Act, by failing to keep records that Mamak was required to keep under the FW Act that included information prescribed by the FW Regulations; and
(n) subsection 44(1) of the FW Act, by failing to provide the Fair Work Information Statement to each of the Employees as required by subsection 125(1) of the FW Act.”
Each of the second, third and fourth respondents admits to being responsible for the overall direction, control, management and supervision of Mamak’s operations in relation to industrial instruments and arrangements, settling and adjusting pay rates and determining conditions of employment.
Further, each of the second, third, and fourth respondents admits that they were a person who authorised decisions regarding Mamak’s operations including decisions regarding the employment of staff and employee entitlements.
Further, each of the second, third and fourth respondents admits they are a person responsible for deciding what pay would be made to employees and if, when and in what form, pay slips would be issued.
Each of the second, third and fourth respondents admits that they were responsible for record keeping, including in relation to the employment of staff on behalf of Mamak.
Each of the second, third and fourth respondents admit that they were a person responsible for ensuring that Mamak complied with its legal obligations under the FW Act, including its obligations to its employees.
Each of the second, third and fourth respondents admit that by reason of s.793(1) of the FW Act they were a person whose conduct was conduct engaged in by Mamak, as if it was engaged in on behalf of Mamak, and was within the scope of actual or apparent authority.
Further, each of the second, third and fourth respondents admits that by reason of s.793(2) of the FW Act they were a person whose state of mind was the state of mind of Mamak for conduct engaged in within the scope of the actual or apparent authority.
The relevant particulars in respect of the Employees are summarised in the Further Statement of Agreed Facts, filed on 9 April 2019, as follows:
“Employees
9. The Employees were employed by Mamak in the Chatswood Restaurant during the following periods (Employment Period):
(a) Mr Timothy Lee - from 21 October 2014 to 24 January 2016; and
(b) Ms Ibrahim - from 30 June 2014 to 2 February 2015 (First Ibrahim Employment Period) and from on or about 14 June 2015 to on or about 29 June 2016 (Second Ibrahim Employment Period).
Mr Timothy Lee
10. At all times during his Employment Period, Mr Timothy Lee:
(a) was employed by Mamak as wait staff at the Chatswood Restaurant;
(b) worked less than an average of 38 hours per week and did not have reasonably predictable hours of work;
(c) was employed by Mamak on a casual basis; and
(d) performed tasks required of wait staff, including cleaning tables, clearing tables, taking orders from and serving food to customers, incidental cleaning of the Chatswood Restaurant and stacking chairs when the Chatswood Restaurant closed for the night.
11. During his Employment Period, Mamak paid Mr Timothy Lee the following wages:
(a) a base hourly rate of $13 from 21 October 2014 to on or about 20 September 2015;
(b) a base hourly rate of $13.15 from on or about 21 September 2015 to 2 November 2015;
(c) a base hourly rate of $14.15 from 2 November 2015 to 24 January 2016; and
(d) time and a half (150%) when he performed work on a public holiday.
12. During his Employment Period, Mr Timothy Lee performed ordinary hours of work for Mamak at the Chatswood Restaurant on:
(a) Monday to Friday before 10:00pm;
(b) Monday to Friday between 10:00pm and midnight;
(c) Saturdays;
(d) Sundays; and
(e) public holidays.
Ms Ibrahim
13. At all times during her Employment Period, Ms Ibrahim:
(a) was employed by Mamak as wait staff at the Chatswood Restaurant;
(b) worked less than an average of 38 hours per week and did not have reasonably predictable hours of work;
(c) was employed by Mamak on a casual basis; and
(d) performed tasks required of wait staff, including cleaning tables, clearing tables, taking orders from and serving food to customers, incidental cleaning of the Chatswood Restaurant and stacking chairs when the Chatswood Restaurant closed for the night.
14. During her Employment Period, Mamak paid Ms Ibrahim the following wages:
(a) a base hourly rate of between $12 from 30 June 2014 to $16 on or about 30 June 2016; and
(b) time and a half (150%) when she performed work on a public holiday.
15. During her Employment Period, Ms Ibrahim performed ordinary hours of work at Mamak on:
(a) Monday to Friday before 10:00pm;
(b) Monday to Friday between 10:00pm and midnight;
(c) Saturdays;
(d) Sundays; and
(e) public holidays.”

C. Industrial Instruments

It is also agreed that the relevant legislation and industrial instruments are as follows:
“16. At all times during their respective Employment Periods, Mamak was bound in respect of each of the Employees by the FW Act and the FW Regulations.
17. At all times during their respective Employment Periods, the Restaurant Award covered and applied to Mamak in relation to the employment of each of the Employees.
18. The Employees were properly classified in the following classifications of the Restaurant Award during their respective Employment Periods:

Employee	Period	Classification
Mr Timothy Lee	21 October 2014 to 19 January 2015	Introductory Level (Introductory)
Mr Timothy Lee	20 January 2015 to 24 January 2016	Food & Beverage Attendant Grade 2 (F&B 2)
Ms Ibrahim	30 June 2014 to 29 September 2014	Introductory
Ms Ibrahim	30 September 2014 to on or about 30 June 2016	F&B 2

19. From 30 June 2014 to 6 July 2014 (being the end of the last pay period commencing before 1 July 2014), Mamak was required to pay Ms Ibrahim in accordance with the transitional arrangements in Schedule A of the Restaurant Award, being pay rates calculated with reference to the relevant transitional minimum wage instrument. The relevant transitional instrument was the Australian Pay and Classification Scale derived from the Restaurants, &c., Employees (State) Award (Restaurant Pay Scale).
20. During the period from 30 June 2014 to 6 July 2014, Ms Ibrahim performed duties falling within the scope of a Grade 1 employee provided in clause 3 of the Restaurant Pay Scale.”

D. Total Underpayments and Rectifications

It is also agreed the that the total underpayments and rectification is as follows:
“21. The parties agree that during their respective Employment Periods, the Employees were
underpaid a total of $23,195.68 (including tax) as follows:

Entitlement	Tim Lee Employment Period	First Ibrahim Employment Period	Second Ibrahim Employment Period
Monday to Friday before 10:00pm	$2,468.41	$2,190.11	$1656.71
Monday to Friday between 10:00pm and midnight	$165.44	$105.41	$38.19
Saturday	$965.55	$604.03	$1,299.00
Sunday	$2,166.62	$2,168.18	$1,299.00
Public holidays	$594.06	$349.82	$504.78
Casual loading	$2,406.83	$2,148.32	$1,877.74
Total	$$8,766.91 (Lee Underpayment)	$$7,565.87 (First Ibrahim Underpayment)	$$6862.900 (Second Ibrahim Underpayment)

22. On or around 30 August 2016, Mamak issued Mr Timothy Lee with PAYG payment summaries for the 2014-2015 financial year and the 2015-2016 financial year (Lee PAYG Payment Summaries). Mr Timothy Lee subsequently used the Lee PAYG Payment Summaries to obtain from the Australian Taxation Office (ATO) a tax refund for the 2014-2015 and 2015-2016 financial years.
23. On 6 October 2016, Mamak provided the Applicant with a copy of Ms Ibrahim's PAYG payment summary for the 2014-2015 financial year (Ibrahim PAYG Payment Summary). Christine Wang, a Fair Work Inspector appointed under section 700 of the FW Act (Inspector Wang) subsequently provided the Ibrahim PAYG Payment Summary to Ms Ibrahim, who used it to obtain from the ATO a tax refund for the 2014-2015 financial year.
24. The Parties agree that the amounts which are recorded as being tax withheld in the Lee PAYG Payment Summaries and Ibrahim PAYG Payment Summary can be taken into account for the purposes of rectification of the agreed underpayments.
25. On 4 February 2019 Mr Clement Lee provided a cheque to the liquidator of Mamak, Jirsch Sutherland Insolvency Solutions (the Liquidator), in the amount of $8,112.83 for the purpose of rectifying the remaining underpayments to Mr Timothy Lee and Ms Ibrahim.
26. On 8 March 2019, the Respondents requested the Liquidator make payments to Mr Timothy Lee and Ms Ibrahim as soon as possible to satisfy the outstanding underpayment amounts, specifically:
(a) $106.58 in respect of the Lee Underpayment; and
(b) $6,862.90 in respect of the Second Ibrahim Underpayment,

and sought confirmation and acknowledgement of the payments from the Liquidator.
27. On 25 March 2019, the Liquidator confirmed that the remaining underpayments had been paid but that it had remitted PAYG Withholding Tax to the ATO (of its own volition), which resulted in the following net amounts being paid:
(a) $4,495.20 net to Ms Ibrahim (as the result of withholding $2,367.70 in tax from the $6,862.90 gross amount); and
(b) $69.81 net to Mr Timothy Lee (as the result of withholding $36.77 in tax from the $106.58 gross amount).”

The contraventions essentially comprise underpayment contraventions and record-keeping and payslip contraventions.
Pursuant to the Further Statement of Agreed Facts, the following facts in respect of each are admitted by the respondents:
“UNDERPAYMENT CONTRAVENTIONS
Contraventions of section 45 of the FW Act - failure to pay minimum rates of pay as required by clauses 20.1 and A.2.5 of Schedule A to the Restaurant Award
28. During the Employees' respective Employment Periods, Mamak was required to pay the Employees the following minimum rates of pay prescribed by clauses 20.1 and A.2.5 of Schedule A to the Restaurant Award, in respect of each ordinary hour worked on Monday to Friday:

*Dates*	Introductory minimum rate (including tax)	*F&B minimum rate (including tax)*
01/07/2013 - 06/07/2014	$16.37	N/A
07/07/2014 - 05/07/2015	$16.87	$18.02
06/07/2015 - 30/06/2016	N/A	$18.47

29. During their Employment Periods, Mamak paid:
(a) Mr Timothy Lee the rates of pay specified at paragraph 11 above; and
(b) Ms Ibrahim the rates of pay specified at paragraph 14 above;

30. By reason of the matters agreed at paragraphs 28 to 29 above, the amounts paid by Mamak to the Employees were insufficient to satisfy the Employees' entitlement to minimum rates of pay for ordinary hours worked, pursuant to clauses 20.1 and A.2.5 of Schedule A to the Restaurant Award, thereby causing the Employees to be underpaid.
31. By reason of the matters agreed at paragraphs 12(a), 15(a) and 28 to 30 above, Mamak:
(a) contravened a term of a modern award, being clause 20.1 of the Restaurant Award and, in the period up to 6 July 2014, clause A.2.5 of Schedule A to the Restaurant Award; and
(b) thereby contravened section 45 of the FW Act, which is a civil remedy provision under subsection 539(2) of the FW Act.

Contraventions of section 45 of the FW Act - failure to pay casual loading as required by clauses 13.1 and A.5.4 of Schedule A to the Restaurant Award
32. During the Employees' respective Employment Periods, pursuant to clauses 13.1 and A.5.4 of Schedule A of the Restaurant Award, Mamak was required to pay the Employees the following casual loadings, for ordinary hours of work on Monday to Friday:
(a) 24% in the period from 1 July 2013 to 6 July 2014; and
(b) 25% in the period from 7 July 2014 onwards.

33. By reason of the matters agreed at paragraph 29 above, the wages paid to each of the Employees were insufficient to satisfy the Employees' entitlement to casual loading for the ordinary hours worked, pursuant to clauses 13.1 and A.5.4 of Schedule A of the Restaurant Award, thereby causing the Employees to be underpaid.
34. By reason of the matters agreed at paragraphs 12, 15 and 32 to 33 above, Mamak:
(a) contravened a term of a modern award, being clause 13.1 of the Restaurant Award and, in the period up to 6 July 2014, clause A.5.4 of Schedule A to the Restaurant Award; and

(b) thereby contravened section 45 of the FW Act, which is a civil remedy provision under subsection 539(2) of the FW Act.

Contraventions of section 45 of the FW Act - failure to pay Saturday penalty rates as required by clause 34.1 of the Restaurant Award
35. During the Employees' respective Employment Periods, Mamak was required to pay the Employees a penalty rate of 150% (inclusive of casual loading) for ordinary hours of work performed on a Saturday in the period from 7 July 2014 onwards, pursuant to clause 34.1 of the Restaurant Award.
36. By reason of the matters agreed at paragraph 29 above the wages paid to the Employees were insufficient to satisfy the Employees' entitlement to Saturday penalty rates for the ordinary hours worked on a Saturday, pursuant to clause 34.1 of the Restaurant Award, thereby causing the Employees to be underpaid.
37. By reason of the matters agreed at paragraphs 12(c), 15(c) and 35 to 36 above, Mamak:
(a) contravened a term of a modern award, being clause 34.1 of the Restaurant Award; and
(b) thereby contravened section 45 of the FW Act, which is a civil remedy provision under subsection 539(2) of the FW Act.

Contraventions of section 45 of the FW Act - failure to pay Sunday penalty rates as required by clauses 34.1 and A.7.3 of Schedule A of the Restaurant Award
38. During the Employees' respective Employment Periods, Mamak was required to pay the Employees the following penalty rates (including tax) for ordinary hours of work performed on a Sunday (inclusive of casual loading), pursuant to clauses 34.1 and A.7.3 of Schedule A to the Restaurant Award:
(a) 164% in the period from 1 July 2013 to 6 July 2014; and
(b) 150% in the period from 7 July 2014 onwards.

39. By reason of the matters agreed at paragraph 29 above, the wages paid to the Employees were insufficient to satisfy the Employees' entitlement to Sunday penalty rates for the ordinary hours worked on a Sunday, pursuant to clauses 34.1 and A.7.3 of Schedule A of the Restaurant Award, thereby causing the Employees to be underpaid.
40. By reason of the matters agreed at paragraphs 12(d), 15(d) and 38 to 39 above, Mamak:
(a) contravened a term of a modern award, being clause 34.1 of the Restaurant Award and, in the period up to 6 July 2014, clause A.7.3 of Schedule A to the Restaurant Award; and
(b) thereby contravened section 45 of the FW Act, which is a civil remedy provision under subsection 539(2) of the FW Act.

Contraventions of section 45 of the FW Act - failure to pay additional penalty amount for work done from 10.00 pm to midnight on Monday to Friday as required by clauses 34.2 and A.7.3 of the Restaurant Award
41. During the Employees' respective Employment Periods, Mamak was required to pay the Employees the following additional penalty amounts (including tax) for each hour or part of an hour for work performed between 10:00 pm and midnight on Monday to Friday, pursuant to clauses 34.2 and A.7.3 of Schedule A to the Restaurant Award:
(a) 8% in the period from 1 July 2013 to 6 July 2014; and
(b) 10% in the period from 1 July 2014 onwards.

42. By reason of the matters agreed at paragraph 29 above, the wages paid to the Employees were insufficient to satisfy their entitlement to the additional penalty amount for the ordinary hours worked between 10.00 pm and midnight, pursuant to clauses 34.2 and A.7.3 of Schedule A to the Restaurant Award, thereby causing each of the Employees to be underpaid.
43. By reason of the matters agreed at paragraphs 12(b), 15(b) and 41 to 42 above, Mamak:
(a) contravened a term of a modern award, being clause 34.2 of the Restaurant Award and, in the period up to 6 July 2014, clause A.7.3 of Schedule A to the Restaurant Award; and
(b) thereby contravened section 45 of the FW Act, which is a civil remedy provision under subsection 539(2) of the FW Act.

Contraventions of section 45 of the FW Act - failure to pay public holiday penalty rates as required by clause 34.1 of the Restaurant Award
44. During the Employees' respective Employment Periods, pursuant to clause 34.1 of the Restaurant Award, Mamak was required to pay the Employees a penalty rate of 250% (including tax) in the period from 7 July 2014 onwards for ordinary hours of work performed on a public holiday (inclusive of casual loading).
45. By reason of the matters agreed at paragraph 29 above, the wages paid to the Employees were insufficient to satisfy their entitlement to public holiday penalty rates for the ordinary hours worked on a public holiday, pursuant to clause 34.1 of the Restaurant Award, thereby causing each of the Employees to be underpaid.
46. By reason of the matters agreed at paragraphs 12(e), 15(e) and 44 to 45 above, Mamak:
(a) contravened a term of a modern award, being clause 34.1 of the Restaurant Award; and
(b) thereby contravened section 45 of the FW Act, which is a civil remedy provision under subsection 539(2) of the FW Act.

RECORD-KEEPING AND PAY SLIP CONTRAVENTIONS
48. On 20 May 2016, Inspector Wang issued a notice to produce pursuant to section 712 of the FW Act to Mamak (May NTP), seeking production of records or documents with respect to Mamak's employment of Mr Timothy Lee for the period between 12 October 2014 and May 2016, by 5pm on 6 June 2016.
49. On 3 June 2016, Mamak produced documents in response to the May NTP (June Response).
50. As part of the June Response, Mamak provided to the offices of the FWO, documents titled “Payroll Advice”, (Lee Payroll Advices) which state that they are for the period from 20 October 2014 to 25 January 2016 that displayed:
(a) a base hourly rate of $21.09, $22.53 or $23.09 (when rounded to two decimal places);
(b) a casual late night loading of $1.96 or $2.01;
(c) a casual weekend hourly rate of $25.31, $27.04 or $27.71 (when rounded to two decimal places);
(d) a casual public holiday rate of $45.06 or $46.18 (when rounded to two decimal places);
(e) gross and net amounts of pay calculated using the above pay rates;
(f) PAYG income taxation deductions made from Mr Timothy Lee's gross salary by Mamak; and
(g) amounts remitted in respect of superannuation contributions.

51. On 10 November 2016, Inspector Wang issued a notice to produce pursuant to section 712 of the FW Act to Mamak (November NTP) seeking production of records or documents with respect to Mamak's employment of Ms Ibrahim, for the period between July 2014 and July 2016, by 5pm on 24 November 2016.
52. On 24 November 2016, Mamak produced documents in response to the November NTP (November Response).
53. As part of the November Response, in response to the November NTP which requested wage records, Mamak provided to the offices of the FWO documents (Ibrahim Payroll Advices) which state that they are for the period from 30 June 2014 to 8 February 2015 that displayed:
(a) a base hourly rate of $22.53 (when rounded to two decimal places);
(b) a casual late night loading of $1.96;
(c) a casual weekly hourly rate of $27.07 (when rounded to two decimal places);
(d) a casual public holiday rate of $45.05 (when rounded to two decimal places);
(e) gross and net amounts of pay calculated using the above pay rates;
(f) PAYG income taxation deductions made from Ms Ibrahim's gross salary by Mamak; and
(g) amounts remitted in respect of superannuation contributions.

54. In response to the November NTP, Mamak did not provide any payroll advices to the FWO for the Second Ibrahim Employment Period.
Contraventions of subsection 535(1) of the FW Act - failing to keep records as prescribed by regulation 3.33 of the FW Regulations
55. At all material times, pursuant to subsection 535(1) of the FW Act, Mamak was required to make and keep for a period of 7 years, certain records in respect of the Employees.
56. At all material times, pursuant to subsection 535(1) of the FW Act and regulation 3.33 of the FW Regulations, Mamak was required, relevantly, to make and keep a record:
(a) of the rate of remuneration paid to the Employee; and
(b) of the gross and net amounts paid to the Employee; and
(c) of any deductions made from the gross amount paid to the Employee; and
(d) if the Employee is entitled to be paid a loading or a penalty rate, of details of the loading or penalty rate, (collectively the Pay Records); and
(e) if the employee is a casual, the hours worked by the Employee (Casual Hours Records).

57. During the Second Ibrahim Employment Period, Mamak:
(a) failed to make and keep Pay Records for Ms Ibrahim, as prescribed by regulation 3.33 of the FW Regulations;
(b) failed to keep Casual Hours Records in respect of the hours worked by Ms Ibrahim between 4 September 2015 and 14 December 2015, as prescribed by regulation 3.33 of the FW Regulations; and
(c) failed to make and keep Casual Hours Records in respect of the hours worked by Ms Ibrahim from 14 June 2015 to 3 September 2015 and 15 December 2015 to 29 June 2016, as prescribed by regulation 3.33 of the FW Regulations; and
(d) thereby contravened subsection 535(1) of the FW Act, which is a civil remedy provision under subsection 539(2) of the FW Act.

Contraventions of subsection 536(2) of the FW Act - failing to give a pay slip that includes information prescribed by the FW Regulations
58. At all material times during their respective Employment Periods, pursuant to section 536 of the FW Act, Mamak was required to:
(a) give each of the Employees a pay slip within one working day of paying an amount to the employee in relation to the performance of work (subsection 536(1) of the FW Act); and
(b) give each of the Employees a pay slip that was in a form prescribed by the FW Regulations (subsection 536(2) of the FW Act).

59. At all material times, pursuant to regulation 3.46 of the FW Regulations, Mamak was required to make and keep pay slips that included (relevantly) the following information:
(a) Mamak's name (sub-regulation 3.46(1)(a));
(b) the date on which the payment to which the pay slip relates was made (sub-regulation 3.46(1)(d));
(c) the gross amount of the payment (sub-regulation 3.46(1)(e));
(d) any amount paid to the employee that is a bonus, loading, allowance, penalty rate, incentive-based payment or other identifiable entitlement (sub-regulation 3.46(1)(g));
(e) on and after 1 January 2010, the Australian Business Number (if any) of Mamak (sub-regulation 3.46(1)(h));
(f) if an amount was deducted from the gross amount of the payment, the name, or the name and number, of the fund or account into which the deduction was paid (sub-regulation 3.46(2)); and
(g) details of any superannuation contributions (sub-regulation 3.46(5)).

60. During the Employees' respective Employment Periods, Mamak provided the Employees with a pay slip each week.
61. The pay slips provided to the Employees during their respective Employment Periods, as described at paragraph 60 above, failed to record:
(a) Mamak's name;
(b) the date on which the payment to which the pay slip related was made;
(c) the gross amount of the payment;
(d) any amount paid to the Employee that was a bonus, loading, allowance, penalty rate, incentive-based payment or other identifiable entitlement;
(e) the Australian Business Number of Mamak; and
(f) details of any superannuation contributions.

62. By reason of the matters agreed at paragraphs 58 to 61 above, Mamak:
(a) made and kept pay slips, and provided those pay slips to the Employees, that did not comply with the requirements prescribed in regulation 3.46 of the FW Regulations; and
(b) thereby contravened subsection 536(2) of the FW Act, which is a civil remedy provision under subsection 539(2) of the FW Act.

Contraventions of sub-regulations 3.44(1) and 3.44(6) of the FW Regulations - keeping records that Mamak knew to be false or misleading and making use of such records
63. At all material times, pursuant to sub-regulation 3.44(1) of the FW Regulations, Mamak was required to ensure that a record it was required to keep under the FW Act or the FW Regulations was not false or misleading to its knowledge.
64. At all material times, pursuant to sub-regulation 3.44(6) of the FW Regulations, Mamak was required to not make use of an entry in an employee record made and kept by it for Subdivision 1 of Chapter 3, Part 3-6, Division 3 of the FW Regulations, if it did so knowing that the entry was false or misleading.
65. At all material times during the Employees' Employment Periods, pursuant to regulations 3.33(1), 3.33(3) and 3.37 of the FW Regulations, Mamak was required to make and keep a record that specified, relevantly:
(a) the rate of remuneration paid to the Employees;
(b) the gross and net amounts paid to the Employees;
(c) any deductions made from the gross amounts paid to the Employees;
(d) details of the payment of a loading or penalty rate, if the Employees were entitled to be paid those amounts; and
(e) superannuation contributions made for the benefit of the Employees.

66. The Lee Payroll Advices and the Ibrahim Payroll Advices (collectively, the Payroll Advices) (referred to at paragraphs 50 and 53 above) were records of the type that Mamak was required to keep, as agreed at paragraph 65.
Payroll Advices
67. The Lee Payroll Advices produced by Mamak to the offices of the FWO were false or misleading.
68. The Ibrahim Payroll Advices produced by Mamak to the offices of the FWO were false or misleading.
69. When Mamak created the Payroll Advices, Mamak knew that the Payroll Advices were false or misleading.
70. When Mamak provided the Payroll Advices to the offices of the FWO, Mamak knew that the Payroll Advices were false or misleading.
Admitted resulting contraventions
71. By reason of the matters agreed at paragraphs 63 to 69 above, Mamak:
(a) failed to ensure that each of the Payroll Advices were not false or misleading to its knowledge; and
(b) in doing so, contravened sub-regulation 3.44(1) of the FW Regulations, which is a civil remedy provision pursuant to sub-regulation 4.01A(2) of the FW Regulations.

72. By reason of the matters agreed at paragraphs 69 to 70 above, Mamak made use of an entry in an employee record by:
(a) producing the Lee Payroll Advices to the offices of the FWO in the June Response; and
(b) producing the Ibrahim Payroll Advices to the offices of the FWO in the November Response.

73. By reason of the matters agreed at paragraphs 63 to 72 above, by providing the Lee Payroll Advices and the Ibrahim Payroll Advices to the offices of the FWO, Mamak, on two occasions:
(a) made use of an entry in an employee record made and kept by it for the purposes of Part 3-6, Division 3 of the FW Regulations, knowing that the entry was false or misleading; and
(b) in doing so, contravened sub-regulation 3.44(6) of the FW Regulations, which is a civil remedy provision pursuant to sub-regulation 4.01A(2) of the FW Regulations.

Contraventions of subsection 535(2) of the FW Act - failing to keep records that include information prescribed by the FW Regulations
74. At all material times, pursuant to subsection 535(2) of the FW Act, Mamak was required to make and keep employee records of the kind contemplated in subsection 535(1) of the FW Act:
(a) in a form prescribed by the FW Regulations; and
(b) including any information prescribed by the FW Regulations.

75. The Payroll Advices produced by way of the June Response and the November Response failed to include information required by regulation 3.33 of the FW Regulations records, namely:
(a) the actual rate of remuneration paid to the Employees (sub-regulation 3.33(1)(a)); and
(b) the gross and net amounts paid to the Employees (sub-regulation 3.33(1)(b)),

in relation to Mr Timothy Lee's Employment Period or Ms Ibrahim's First Ibrahim Employment Period.
76. By reason of the matters agreed at paragraphs 74 to 75 above, during Mr Timothy Lee's Employment Period and Ms Ibrahim's First Ibrahim Employment Period, Mamak:
(a) failed to make and keep records that included the information prescribed by regulation 3.33 of the FW Regulations; and
(b) thereby contravened subsection 535(2) of the FW Act, which is a civil remedy provision under subsection 539(2) of the FW Act.

Contraventions of subsection 44(1) of the FW Act - failing to give the Employees the Fair Work Information Statement
77. Pursuant to subsection 125(1) of the FW Act, Mamak was required to give each of the Employees the Fair Work Information Statement (FWIS) before, or as soon as practicable after, the commencement of their respective Employment Periods.
78. Mamak did not provide the Employees with a FWIS at any stage before or during their employment.
79. By reason of the matters agreed at paragraphs 77 and 78 above, Mamak:
(a) contravened subsection 125(1) of the FW Act, which is one of the National Employment Standards by reason of subsection 61 (1) of the FW Act; and
(b) thereby contravened subsection 44(1) of the FW Act, which is a civil remedy provision under subsection 539(2) of the FW Act.”

E. Agreed Knowledge and Responsibilities of Respondents

In relation to the agreed knowledge and responsibility of each of the respondents, the Further Statement of Agreed Facts is as follows:
“Underpayment contraventions
80. At all material times during the Employees' respective Employment Periods, each of Mr Clement Lee, Mr Julian Lee and Mr Au:
(a) knew the duties performed by each of the Employees, as agreed at paragraphs 10(d) and 13(d) above;
(b) knew that each of the Employees were engaged on a casual basis;
(c) knew that each of the Employees performed work:
(i) on Mondays to Fridays before 10:00pm;
(ii) on Mondays to Fridays between 10:00pm and midnight;
(iii) on Saturdays;
(iv) on Sundays;
(v) on public holidays;
(d) knew the amounts paid by Mamak to each of the Employees during their respective Employment Periods;
(e) knew that Mamak was bound in respect of each Employee by the FW Act and the FW Regulations during the Employee's respective Employment Periods; and
(f) knew that, during their respective Employment Periods, Mamak was covered by the Restaurant Award with respect to the employment of the Employees.
Record-keeping and pay slip contraventions
81. At all material times during the Employees' respective Employment Periods, each of Mr Clement Lee, Mr Julian Lee and Mr Au were:
(a) the persons responsible for authorising the creation of employee records kept by Mamak; and
(b) aware that Mamak was required to make and keep certain records in relation to Ms Ibrahim as prescribed by the FW Regulations.
82. At all material times during the Employees' respective Employment Periods, each of Mr Clement Lee, Mr Julian Lee and Mr Au were:
(a) the persons responsible for authorising the creation of pay slips to be provided to each of the Employees;
(b) aware that Mamak gave the pay slips to the Employees;
(c) aware that Mamak was obliged by the FW Act and FW Regulations to ensure that the pay slips contained certain information;
(d) aware of the content of Mamak's pay slips; and
(e) aware that the pay slips issued to the Employees did not contain the information detailed at subparagraphs 61 (a) to 61 (f) above.
83. At all material times, each of Mr Clement Lee, Mr Julian Lee and Mr Au were:
(a) the persons responsible for authorising the creation of the Payroll Advices;
(b) aware that the Payroll Advices were false or misleading; and
(c) aware that the Payroll Advices were provided to Inspector Wang on 3 June 2016 and 20 November 2016.
84. At all material times during the Employees' respective Employment Periods, each of Mr Clement Lee, Mr Julian Lee and Mr Au were aware that Mamak did not provide the Fair Work Information Statement to the Employees.”
Accordingly, I make findings in respect of all the admitted facts as referred to in the paragraphs above.

F. Taxation Treatment and Payroll Advices

There exists a dispute between the parties in relation to the following:
i)What was, in fact, the taxation treatment (by the First Respondent) of the amounts paid to the Employees during their respective Employment Periods (and, consequently, what was the taxation treatment of the total underpayment of wages to the Employees during their respective Employment Periods).
ii)What was, in fact, the basis upon which the payroll advices produced to the Applicant by the First Respondent were false or misleading.
iii)What is, as a matter of law, the appropriate penalty to be imposed on the Respondents.

i) Taxation Treatment of amounts paid to the Employees

The respondents submit that the amounts paid to the Employees were paid as net amounts which excluded tax.
The FWO submits that the amounts paid were the total amounts paid to the Employees and that no amounts were withheld by Mamak for the purposes of being remitted to the Australian Taxation Authority (“the ATO”) in respect of the Employees during their respective Employment Periods.
It is common ground that the amounts paid to the Employees were insufficient to satisfy the Employees gross entitlement under the Restaurant Award, even if they included tax.
The FWO submits that the respondents’ suggestion that Mamak paid the Employees more than the admitted flat rates of pay or had a practice of withholding additional taxation amounts is misleading.
The respondents assert that initially they were not provided with the actual figures of underpayment. Once those details were received, the respondents reviewed their accounting systems. That exercise revealed that the discrepancy between what was recorded as having been paid to the Employees and what the FWO was now claiming as the quantum of underpayment included, inter alia, an amount of taxes withheld by Mamak in the usual course of paying wages to the Employees.
There is no other evidence provided by the respondents in support of that assertion.
The FWO refers to the following evidence in support of its assertion that the payments made were gross amounts and that no further amount was withheld in satisfaction of an amount of taxes:
“21. Further, the following evidence supports that during the period in which the contraventions arose, the amounts paid by Mamak to the Employees were treated as gross amounts and no further amount was withheld in satisfaction of “an amount of taxes”:
(a) the pay slips provided to the Employees throughout their Employment Periods did not show any deductions for PAYG withholding amounts;
(b) neither Mr Timothy Lee nor Ms Ibrahim were ever asked for or provided their Tax File Numbers (TFNs) to anyone at Mamak during their Employment Periods;
(c) as at 3 June 2016, Mamak did not have a TFN declaration for Mr Timothy Lee;
(d) the first time Mamak (through its officer Shernice Sing Pin, Kitchen Manager) asked for Ms Ibrarum's TFN was on 21 September 2016, after the FWO issued Mamak with a further Notice to Produce Records or Documents (NTP) on 20 September 2016 in respect of Ms Ibrahim's employment. In that request Shernice stated “Timothy has provided the rosters to fair work n u r one of the randomly picked by them to ask mmk to provide them with ur payg summary…So now mamak needs to pay back all the tax and super with the hours that u worked during 7/2014-…6/2015…So in other words you will get extra money dear”;
(e) neither Mr Timothy Lee or Ms Ibrahim were ever issued with a PAYG withholding payment summary (PAYG Summary) during the time they worked at Mamak; and
(f) when FWI Wang met with the Respondents on 19 May 2015 they admitted that “no tax is paid” in respect of Mamak's employees.”
(Footnotes omitted)
I have had regard to the explanations by the respondents in respect of each of those subparagraphs. They are as follows:
“(3) The FWO asserts at paragraph 21 of its submissions that there is evidence purporting to demonstrate that tax was not being withheld during the period in which the contraventions arose. The Respondents address each piece of ‘evidence’ as follows:
(a) Paragraph 21(a): The pay slips (or the “pay strips”) provided as evidence by the Two Employees were temporary records they were provided, in addition to full versions of the pay slips (“payroll advice”) that the Employees were supposed to also receive. At that time, because of the circumstances explained at paragraphs 18 and 19 of Clement Lee's affidavit dated 13 May 2019, the Respondents would not have been aware of circumstances in which any employees did not receive their payroll advice unless the employees had notified them. As explained at paragraphs 29, 30 and 33 of Clement Lee's affidavit, neither Ms Ibrahim nor Mr Lee raised this concern with the Respondents during their employment.
(b) Paragraph 21(b) and (c): There is no obligation under the FW Act or the FW Regulations for an employer to obtain or keep a record of employees' TFNs. See Part 3-6, Division 3, Subdivision 1 of the Regulations which identifies which specific records must be obtained and kept from employees. The exclusion of TFN records in the Regulations is acknowledged by the FWO in their online record-keeping template. Whether or not the Respondents actually sought or obtained the TFN declarations from Ms Ibrahim and Mr Lee is irrelevant to the issue of whether or not they withheld tax, or the correct amount of tax, pursuant to their ATO obligations.
(c) Paragraph 21(d): This occurred at the time that the Jag Ludher Audit was being prepared, shortly after the penalty decision and as the Respondents continued to try to identify and fix the payroll system issues: see Clement Lee's affidavit. Although the Respondents have no specific knowledge of this conversation between their staff, and have therefore provided no evidence in relation to it, it is likely that this occurred in the context of the Respondents instructing their branch managers to obtain and collect employee records for the purpose of assisting and complying with the audit and their industrial obligations.
(d) Paragraph 21(e): The Respondents provided employees with their PAYG summaries via post to their recorded home address. See paragraph 33 and Annexure I, pages 76 to 79 of Clement Lee's affidavit.
(e) Paragraph 21(f): This is a serious misrepresentation of the evidence. At the meeting with FWI Wang on 19 May 2015, Clement stated that "no tax is paid" in respect of the six employees concerned in the First Proceedings, and not as a general statement applying to all of their employees at all times. This statement does not and did not apply to the two Employees concerned in the current proceedings.”
(Footnotes omitted)
Nevertheless, on the evidence before me, I am satisfied that the amounts paid to each of the Employees during the employment period was the gross amount paid and that there was no other amount withheld for tax.
I do accept that subsequently upon notification of the defects in its records in the PAYG summaries, the records did disclose an amount remitted to the ATO as PAYG tax. This was part of the rectification undertaken by Mamak and may be taken into account for the purposes of accepting that Mamak has now rectified the underpayment amounts.
However, I am satisfied that the subsequent rectification does not alter the nature of the underpayments at the time they arose. It was Mamak’s responsibility to fulfil its obligations to its employees and to have a system which ensured those obligations to its employees would be met. I accept the submission of the FWO that the system created by Mamak had the effect of systematically and not insignificantly underpaying the Employees throughout their Employment Periods.
Further, based on the evidence before me I accept that the Employees were not provided with proper payslips in the form of payroll advices. I do not accept that the pay strips provided by the respondents were sufficient to comply with their obligation to provide proper payslips to each of the Employees.

Basis on which Payroll Advices were False or Misleading

In relation to the content of the false or misleading payroll advices, whilst the respondents have agreed that each of Mr Lee and Ms Ibrahim payroll advices are false or misleading, the respondents do not agree upon the basis on which the documents were false or misleading.
The respondents submit that the payroll advices were only false or misleading because they did not accurately record the amounts of tax withheld during the Employees Employment Periods.
The FWO identified the following evidence in support of its submission regarding the extent to which the documents are false or misleading:
“29. The following evidence clearly supports the FWO's submission regarding the extent to which the documents are false and misleading:
(a) the Employees evidence that they were never paid the hourly rates of pay or penalty rates set out in the Payroll Advices during their Employment Periods;
(b) a simple comparison of the information contained in the Payroll Advices provided in respect of Mr Timothy Lee and the actual payslips received by Mr Timothy Lee during his employment demonstrates that the documents contain completely different rates of pay and total amount paid;
(c) Ms Ibrahim's evidence that no superannuation contributions were ever made on Ms lbrahim'·s behalf by Mamak, where deductions for superannuation contributions were shown in the Ibrahim Payroll Advices;
(d) Mr Timothy Lee's evidence that only one lump sum superannuation contribution was made by Mamak on Mr Timothy Lee's behalf on 9 June 2016 for the first half of his Employment Period only (20 October 2014 to 30 June 2016);36 and
(e) for the reasons detailed above at paragraphs 20 to 23 above, the 'gross amounts' purportedly recorded on the Payroll Advices were not in fact the gross amounts paid to the Employees during the relevant pay periods.”
(Footnotes omitted)
In particular in relation to this issue the FWO made the following submissions:
“47. This submission is a clearly inconsistent with the facts agreed between the parties at paragraph 57 of the FSOAF, which specifies that during the Second Ibrahim Employment Period, the Respondents failed to make and keep Pay Records and failed to make and keep Casual Hours Records (except in respect of a 14 week period between 4 September 2015 and 14 December 2015). As such, it is inadmissible to the extent that it seeks to contradict or qualify the facts agreed between the parties at paragraph 57 of the FSOAF, in contravention of section 191 of the Evidence Act 1995 (Cth) (Evidence Act).
48. Additionally, irrespective of how it arose, the Court should find that this contravention of section 535(1) of the FW Act by the Respondents is significant in light of the impact it had on the FWO’s ability to conduct its investigation, and Ms Ibrahim’s ability to recover the amounts she was owed.
False or misleading records
49. The Respondents submissions attempt to conflate four separate Admitted Contraventions – specifically, the Respondents’:
(a) failure to keep records in relation to Ms Ibrahim (in breach of section 535(1) of the FW Act);
(b) decision to make and keep records they knew to be false or misleading (in breach of reg 3.44(1) of the FW Regulations); and
(c) decision to provide those false or misleading records to the FWO (in breach of reg 3.44(6) of the FW Regulations) on two separate occasions,
and suggests that each of those contraventions simply arose from some unspecified, “inadvertent” deletions of employee records.
50. Each of the contraventions set out above arise from distinct and separate conduct by the Respondents. There is simply no evidence before the Court to support the submission that there was an “inadvertent” deletions of employee records.
51. At paragraph 15 of the Respondents’ submissions, they have stated that “The FWO has not identified any evidence supporting a finding that a deliberate decision was made by any of the Respondents to provide false or misleading records”.
52. In actual fact, the Respondents have agreed in the FSOAF that:
(a) the Lee Payroll Advices and Ibrahim Payroll Advices were false or misleading;
(b) at all material times, the Respondents were responsible for authorising the creation of the Payroll Advices, knew they were false or misleading and knew they had been provided to the FWO; and
(c) one of these productions occurred after the Respondents had already been the subject to a court penalty for producing false or misleading records.
53. The evidence that the Respondents claim supports their submission that the records were provided inadvertently principally refers to the fact that the Respondents were in the process of reviewing and improving their record keeping systems after the First Proceedings and/or had inadvertently deleted some records relating to Natasha’s Second Employment Period. The sole references to the collation of the Payroll Advices are in paragraphs 10 and 11 of the Clement Lee Affidavit. In those paragraphs Mr Clement Lee does not provide any evidence that he was unaware that the records were false or misleading, or that they were somehow provided inadvertently, only stating that he was “unaware that there were any documents or records which were missing or which had been inadvertently deleted” and that “these deletions were not a deliberate attempt to withhold records or provide false or misleading records to the FWO”.
54. This evidence provides absolutely no explanation for how the Respondents could have “inadvertently” authorised the creation and provision of records to the FWO on two separate occasions that:
(a) contained rates of pay which were far above those they knew were paid by Mamak to the Employees;
(b) specified net amounts that did not match the amounts that were actually paid to the Employees;
(c) contained superannuation contributions that were not being made,
and then proceed to repeatedly insist that they were not false or misleading when issues with the Payroll Advices were brought their attention.
55. In these circumstances the Respondents’ submissions that the provision of the false or misleading records was “inadvertent” (and the claim at paragraph 51(8) of the Respondents Submissions that they were “doing their best in the circumstances to comply with the Notices to Produce”) must be rejected. Those submissions are inconsistent with the Respondents’ admissions that they knew (at all material times) that the Payroll Advices were false or misleading, and the FWO submits that the Court should instead find that the provision of these records was a deliberate attempt by the Respondents to mislead the FWO and conceal their wrongdoing.”
(Footnotes omitted)
However, there was no cross examination of Mr Clement Lee’s sworn affidavit evidence of the “inadvertence” explanation. I accept the unchallenged evidence of second respondent, Mr Clement Lee, of the respondents’ explanation as to the inaccuracy of the Payroll Advices. The rectification by the respondents upon the inaccuracies being brought to their attention supports the veracity of that explanation.
In the circumstances, I find that the provision of inaccurate records to the FWO was not a deliberate attempt to provide false or misleading records to the FWO.

G. Principles Relevant to Determination of Penalty

The principles relevant to the determination of penalty are well established. The authorities establish that the Court has a broad discretion to assess the appropriate penalty (see Fair Work Ombudsman v NSH North Pty Ltd trading as New Shanghai Charlestown [2017] FCA 1301 per Bromwich J at [36]).
The factors relevant to the imposition of a penalty have been summarised by Mowbray FM in Mason v Harrington Corporation Pty Ltd t/as Pangaea Restaurant & Bar [2007] FMCA 7 at [26] to [59], as follows:
a)the nature and extent of the conduct which led to the contraventions;
b)the circumstances in which that conduct took place;
c)the nature and extent of any loss or damage sustained as a result of the contraventions;
d)whether there had been similar previous conduct by the respondent;
e)whether the contraventions were properly distinct or arose out of the one course of conduct;
f)the size of the business enterprise involved;
g)whether or not the contraventions were deliberate;
h)whether senior management was involved in the contraventions;
i)whether the party committing the contravention has exhibited contrition;
j)whether the party committing the contravention has taken corrective action;
k)whether the party committing the contravention has cooperated with the enforcement authorities;
l)the need to ensure compliance with minimum standards by provision of an effective means for investigation and enforcement of employee entitlements; and
m)the need for specific and general deterrence.
This summary was adopted by Tracey J in Kelly v Fitzpatrick [2007] FCA 1080 at [14]. While the summary is a convenient checklist, it does not prescribe or restrict the matters which may be taken into account in the exercise of the Court’s discretion (see Sharpe v Dogma Enterprises Pty Ltd [2007] FCA 1550 at [11] per Gyles J; Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8 at [91] per Buchanan J).

Section 557 of the FW Act and Course of Conduct

Section 557(1) of the FW Act provides that, for certain specific contraventions of the FW Act, two or more contraventions of the same civil remedy provision will be treated as a single contravention where that contravention was committed by the same person and arose from the same course of conduct.
The FWO accepted that the effect of s.557(1) of the FW Act was to reduce the number of contraventions in this matter to the 14 separate admitted contraventions agreed by the parties.
However, the issue raised by the respondents is whether or not the respondents were punished for those contraventions in an earlier proceeding in respect of 6 employees employed by Mamak at the Haymarket restaurant where the respondents were punished for breaches of ss.45, 535 and 536 of the FW Act (being the same contraventions in this proceeding but in respect of 2 different employees, namely, Mr Lee and Ms Ibrahim) in Fair Work Ombudsman v Mamak Pty Ltd & Ors [2016] FCCA 2104 (“the First Proceeding”) per Judge Smith.
The respondents have the burden of proving that the admitted contraventions arose from the same course of conduct as those subject to the First Proceeding (see Re: Australasian Meat Industry Employees Union v Meneling Station Pty Limited [1987] FCA 4 at [45] per Evatt J).
The respondents submitted that Judge Smith was not confident that the adopted business model for which the respondents were penalised had been applied to “every employee”. The respondents submitted that on the balance of probability the underpayments to the Employees the subject of these proceedings fell within the earlier business model which by 2016, the respondents were actively attempting to rectify. The respondents submit that the courses of conduct are the same courses of conduct in both the First Proceeding and this proceeding and arose from the same decisions made by the respondents which led to the contraventions.
The respondents made the following submission in relation to this issue:
“32. With the exception of the contraventions pleaded pursuant to s125 (being the failure to provide a Fair Work Information Statement) and Regulation 3.44(6) (making use of records), the nature of all other contraventions of the Fair Work Act 2009 (FWA) admitted in the Further Agreed Statement of Facts is identical to those admitted by the Respondents in the First Proceedings in relation to six other employees, and arises as a result of the same decisions which were penalised as a course of conduct in the First Proceedings.

Category of Contravention	Contraventions – The First Proceedings	Alleged contraventions – The Second Proceedings
Section 45 FWA minimum wage breaches	Failure to pay minimum adult and junior hourly rate	Failure to pay minimum rates of pay (SOC [17]-[21])
	Failure to pay casual loading	Failure to pay casual loading (SOC [22]-[25])
	Failure to pay Saturday penalty rates	Failure to pay Saturday penalty rates (SOC [26]-[29])
	Failure to pay Sunday penalty rates	Failure to pay Sunday penalty rates (SOC [30]-[33])
	Failure to pay public holiday penalty rates	Failure to pay public holiday penalty rates (SOC [38]-[41])
	Failure to pay additional penalty amounts for work performed between 10pm-12 midnight Monday to Friday	Failure to pay additional penalty amounts for work performed between 10pm-12 midnight Monday to Friday (SOC [34]-[37])
Section 535 FWA record-keeping breaches	Failure to keep records with information prescribed by the Regulations	Failure to keep records with information prescribed by the Regulations (SOC [42]-[48]); (SOC [72]-[75])
Reg 3.44(1) Reg 3.44(6)	Making and keeping employee records knowing those records were false or misleading Making use of entries in the employee records knowing that those records were false or misleading	Keeping records knowing those records were false and misleading Making use of those records (SOC [56]-[71])
Section 536 FWA pay slip provision breaches	Failure to ensure that pay slips included information provided by the Regulations	Failure to ensure that pay slips included information provided by the Regulations (SOC [49]-[55])
“New” contraventions
Section 125 FWA	Failure to give employees the Fair Work Information Statement (SOC [76]-[78])

33. The following summary chronology makes clear the overlap between the First Proceedings brought by the FWO, and the FWO’s conduct of its investigations leading to the institution of the Second Proceedings.

Date	Event
1 December 2015	Ombudsman filed Statement of Claim in the First Proceedings, regarding the Six Employees
10 February 2016	Respondents’’ attendance at Industrial training workshop
29 March 2016	Ombudsman receives requests for assistance from the Two Employees
9 May 2016	Penalty hearing before Judge Smith in relation to the Six Employees
13 May 2016	Ombudsman meets with Mr Lee (one of the Two Employees) to obtain further information
19 May 2016	Ms Ibrahim (one of the Two Employees) withdraws her request for assistance
20 May 2016	Ombudsman advises Respondents of commencement of Second Investigation in relation to the Two Employees
20 July 2016	Ombudsman visit to Respondents’ chartered accountants
11 August 2016	Ombudsman visit to Respondents’ Chatswood restaurant
18 August 2016	PAYG Summary provided to Timothy Lee as per his email request
19 August 2016	Penalty decision of Judge Smith in relation to the Six Employees Audit ordered for period 1 March 2016 31 December 2016, by 1 March 2017
September and November 2016	Ombudsman issues notices to produce to the Respondents and to the Commonwealth Bank
6 December 2016	Ombudsman issues findings of contravention letter to the Respondents
27 February 2017	Audit completed and reported as per court orders
27 March 2017	Ombudsman requests additional auditing
9 May 2017	Ombudsman filed Statement of Claim in the Second Proceedings, regarding the Two Employees
21 May 2017	Additional auditing completed

34. The chronology makes clear that at the time of the penalty hearing before Judge Smith, the FWO had received requests for assistance alleging against the Respondents further contraventions of the same nature and during the same time period as those already before the Court. Having received such information, the FWO chose to take no formal actions in response, including to notify the Respondents, until after the penalty hearing had taken place, and did not provide the Court with any such information or notice prior to its decision being published in August 2016, despite the Second Investigation being commenced in May 2013. The Respondents should not be penalised for the FWO’s decision in this respect, by additional penalties for the same course of conduct contraventions dealt with in the First Proceedings.
35. The following timeline of contraventions (as admitted in relation to the Six Employees in the First Proceedings and as admitted in relation to the Two Employees in these proceedings) demonstrates that the conduct the subject of the Second Proceedings is also almost wholly subsumed in the timeframe of the conduct which has already been the subject of admitted contraventions and penalty orders in the First Proceedings. The only exception is the end date of Ms Ibrahim’s Second Employment Period, which is after the penalty hearing on 9 May 2016. However, it is also after the FWO notified the respondents of the Second Investigation on 20 May 2016. On the basis that no issues were raised by Ms Ibrahim with the Respondents in relation to her employment or any underpayments during her employment, the Respondents could not locate any records in their systems regarding her second employment period when requested by the FWO, and the FWO did not provide any detail or specifics regarding the allegations relevant to her second employment period until the letter of 6 December 2016, this should be considered of no or minimal weight when viewing the overlapping timeframe of contraventions.
Table 2: Contraventions in First and Second Proceedings by time period

2012	2013	2014	2015	2016
First Proceedings – the Six Employees
Ms Vun	3 December 2013 - 16 December 2014
Mr Woon	4 November 2013 – 29 March 2015
Mr Tan	18 February 2013 – 1 February 2015
Ms Lim	12 May – 7 September 2014
Mr Leong	6 February 2012 – 2 February 2014
Mr Lee	6 August 2012 – 19 April 2015
Second proceedings – the Two Employees
Mr Lee	21 October 2014 – 24 January 2016
Ms Ibrahim	30 June 2014 – 2 February 2015; 14 June 2016 – 29 June 2016

36. When properly considered in the relevant context of the First Proceedings and the penalty orders made there, the effects of ss 556 and 557 of the FWA when applied to the agreed contraventions of ss 45, 535, 536 and r 3.44(1), are:
(1) Pursuant to s 557, because the contraventions in these proceedings were committed by the same person/s and arose out of a course of conduct by them, the contraventions must be treated as single contraventions, as was done in the First Proceedings.
(2) Properly assessed, the contraventions agreed in these proceedings in fact arise from the same course of conduct as the contraventions in the First Proceedings, and therefore fall within the existing single contraventions which the Respondents have already admitted and been penalised for by this Court.
(3) Whether considered as falling within the existing single contraventions, or within further single contraventions, the current alleged contraventions arise from particular conduct for which the Respondents have already been penalised. As a result, because of the operation of s 556, the Respondents cannot be the subject of any further pecuniary penalty as sought by the FWO in relation to this conduct.

37. None of the alleged conduct claimed to support contraventions of sections 45, 535, 536 of the FWA or Regulation 3.44(1) of the FWR in these proceedings occurred after the penalties and orders imposed on 19 August 2016 in the First Proceedings. It cannot be reasonably said therefore that there is any specific deterrence value to be gained by penalties imposed as a result of the Second Proceedings in relation to those contraventions.
38. In any event, the penalties and orders made in the First Proceedings were made with an appreciation of the potential for the broader (business-wide) effect of the Respondents’ conduct giving rise to the admitted contraventions. Judge Smith found (at reasons [56]): ‘I accept that Mamak certainly adopted a business model that included the underpayment of its waiting staff, and propose to take that into account in determining the appropriate penalty’.
39. In Fair Work Ombudsman v Lycamobile Pty Ltd [2018] FCCA 1892 (Lycamobile) this Court dealt with proceedings in which the Respondent had been subject to previous prosecution by the FWO for the same or similar conduct. In its consideration of an appropriate pecuniary penalty to be imposed on the Respondent, the Court separated the contraventions into those which occurred during the first proceedings, and those which occurred in the second proceedings, and imposed varying ranges of pecuniary penalties accordingly. We submit that the Court should take a similar approach in these proceedings.”
(Footnotes omitted)

The FWO submits that the contraventions arose from different factual circumstances and from separate decisions by the respondents and that there is no other overlap that would warrant any different grouping of the admitted contraventions.
The FWO submits that where contraventions arise at different points in time and from different decisions made by the employer, the contraventions are properly treated as separate and distinct and not arising from a course of conduct. The FWO submitted that Ms Ibrahim and Mr Lee were employed at a separate restaurant and in separate, albeit overlapping, time periods to the First Proceeding employees. The FWO submits that the admitted contraventions continued to occur for 18 months after the contraventions which were the subject of the First Proceeding.
However, the chronology provided by the respondents, shows that the FWO filed a Statement of Claim in the First Proceedings in respect of 6 employees which resulted in a penalty hearing before Judge Smith on 9 May 2016. On 10 February 2016, the respondents attended an industrial training workshop.
On 29 March 2016, Ms Ibrahim and Mr Lee contacted the FWO and on 20 May 2016 the FWO advised the respondents of the commencement of the second investigation in relation to Ms Ibrahim and Mr Lee.
On 19 August 2016, in relation to the First Proceeding, Judge Smith ordered an audit for the period of 1 March 2016 to 31 December 2016, which was completed on 27 February 2017. A further audit was requested by the FWO on 27 March 2017 and completed by 21 May 2017.
On 9 May 2017, the FWO filed the Statement of Claim in this proceeding regarding Ms Ibrahim and Mr Lee.
That chronology makes clear that at the time of the penalty hearing before Judge Smith, the FWO had received requests for assistance from Ms Ibrahim and Mr Lee alleging further contraventions by the respondents of the same nature of those already before the Court arising from the same decision made by the employer in overlapping time periods.
The FWO made the following submissions in relation to the First Proceeding insofar as the issue of the grouping of contraventions is concerned:
“In particular, the following is relevant:
(a) the First Proceedings Employees were employed for varying periods between February 2012 and April 2015;
(b) Mr Timothy Lee was employed from 21 October 2014 to 24 January 2016 and the underpayment, record keeping and pay slip contraventions in respect of Mr Timothy Lee continued until 24 January 2016;
(c) Ms Ibrahim was employed for two periods between 30 June 2014 and 29 June 2016, and the underpayment, record keeping and pay slip contraventions in respect of Ms Ibrahim continued until 29 June 2016;
(d) the Respondents were involved in Mamak providing records that they knew to be false or misleading to the FWO on 3 June 2016 in relation to Mr Timothy Lee; and
(e) the Respondents were involved in Mamak providing records that they knew to be false or misleading to the FWO on 24 November 2016 in relation to Ms Ibrahim,
in circumstances where:
(f) the Respondents were informed of the FWO’s investigation into the Haymarket Restaurant as early as 26 March 2015 when the first NTP was issued;
(g) on 19 May 2015, FWI Wang met with the Respondents regarding Mamak’s non- compliance with respect to the Haymarket Restaurant (and during that meeting the Respondents admitted that they knew that the Restaurant Award applied to Mamak’s employees, but that they had deliberately chosen not to pay in accordance with it);
(h) on 10 July 2015, FWI Wang spoke with each of the Respondents to confirm if they had rectified the issues at Mamak’s Haymarket Restaurant, and they confirmed that they were still not complying with the Restaurant Award;
(i) on 25 September 2015 the First Proceedings Contravention Letter was issued to the Respondents in relation to the First Investigation;
(j) on 30 November 2015, the First Proceedings against the Respondents were commenced;
(k) on 10 February 2016, the Respondents attended a Workplace Issues Workshop conducted by NSW Industrial Relations to gain a better understanding of their obligations;
(l) on 26 or 27 January 2016, when Mr Timothy Lee met with the Third Respondent (Mr Julian Lee) and raised his concerns about Mamak’s low rates of pay, Mamak ceased providing him with any further shifts;
(m) on 31 March 2016, the Second Respondent, Joon Hoe Lee (Mr Clement Lee) filed an affidavit in the First Proceedings on behalf of the Respondents in which he apologised for their conduct and stated that he understood that Mamak’s business fell under the Restaurant Award;
(n) in April 2016, Mamak finally increased Ms Ibrahim’s pay rate to $16/hr (a rate that was still significantly below her entitlements under the Restaurant Award at this time),and the Front of House Manager at the Chatswood Restaurant stated to Ms Ibrahim that this was as a result of Mr Timothy Lee lodging a claim with the FWO;
(o) on 9 May 2016, the First Proceedings were heard by the Federal Circuit Court;
(p) in May 2016, Mamak altered the form of Ms Ibrahim’s pay slips (so that they no longer showed her hourly rate of pay or the hours that she had worked) and inevitably made it harder for her to determine her entitlements;and
(q) on 19 August 2016, the judgment in the First Proceedings was delivered, in which the Respondents were found to have been involved in 13 contraventions by Mamak, and the Court specifically commented on the “very serious” nature of the Respondents’ conduct in producing false records to the FWO.
…
That timeline demonstrates that of the 28 month period in which the Admitted Contraventions occurred:
(a) 19 months occurred after the Respondents were on notice that the FWO had concerns regarding Mamak’s Haymarket restaurant (when FWI Wang issued the first NTP and spoke to Clement Lee on 26 March 2015);
(b) 18 months occurred after the contraventions in respect of the First Proceeding Employees had ended (in April 2015);
(c) 14 months occurred after the First Proceedings Contravention Letter was issued on 25 September 2015; and
(d) 12 months occurred after the First Proceedings were commenced on 30 November 2015.”
The FWO submits that the practical effect of the respondents’ submission is that where an employer is on notice and admits contraventions of the FW Act, FW Regulations and Restaurant Industry Award 2010 and has been the subject of penalty proceedings in respect of that conduct, yet continues to commit contraventions in respect of other employees in another section of their business for more than a year, no penalty can be imposed in respect of that ongoing contravening conduct. The FWO submits that the decision to continue to contravene in such circumstances cannot be characterised as a single course of conduct and therefore cannot attract the benefit of s.557 of the FW Act.
In the circumstances of this case I do not accept the characterisation contended for by the FWO. In my view, the FWO chose not to take any formal action in response to those further complaints by Mr Lee and Ms Ibrahim, which were received during the First Proceeding, until after the penalty hearing in the First Proceeding had taken place. The FWO took no step to include those contraventions in that First Proceeding despite that being a course of action open to the FWO.
I accept the submission of the respondents that the respondents endeavoured to rectify underpayments once informed by the FWO in December 2016, in circumstances where the respondents were unable to confirm for themselves the quantum of underpayments alleged. Of course the reason the respondents were in this position was because of the inadequacy of their record keeping systems and their failure to properly discharge their obligations to all their employees, thereby prompting the intervention of the FWO. Nevertheless, the respondents did engage in corrective conduct in respect of the underpayments and inaccuracies in Mamak’s record keeping system as evidenced in their affidavits quoted in paragraph 65 below in these Reasons.
In the circumstances, I find that the admitted contraventions of ss.45, 535 and 536 of the FW Act and reg.3.44(1) of the FW Regulations form part of the same course of conduct as the contraventions considered in the First Proceeding. I also find that the respondents’ contraventions occurred in the context of the conduct by them of the review of their record keeping, payroll and management systems arising from the First Proceeding.

(ii) Contrition

Moreover, the respondents’ contrition and remorse is to be found in the rectification and corrective action taken the by the respondents in relation to the underpayments to Mr Lee and Ms Ibrahim and the subsequent steps taken to address the deficiencies in their systems that led to the contraventions.
Each of the respondents also expressed contrition in their evidence:
a)The first respondent, Joon Hoe Lee (Clement Lee), stated as follows:
“The last few years of my life have been filled with disappointment, remorse and regret due to the shortcomings of our business and its practices, which have inadvertently caused harm to a number of our employees. We had started the business in 2007 in our late 20s without any prior experience. Many of our business practices have been developed based on advice from other business owners. We have since realised that we should have checked with the relevant authorities on any business practices we were unsure of before implementing them, such as wage practices and record keeping practices.
Since the judgment of the First Proceedings, we have spent considerable time and expenses to improve and rectify any shortcomings of our businesses, based on advice and recommendations from trained professionals…I am confident that any payroll and business issues of the past would not occur again.”
b)The second respondent, Julian Lee, stated as follows:
“I acknowledge that there were deficiencies in the company's payroll practices and record keeping for which I am sincerely sorry. I am especially sorry that those deficiencies have had a negative impact on my employees.
Since the first prosecution I have made significant changes to our company's payroll procedures to ensure greater compliance. This included implementing staff entry checklists and providing employment contracts, payslips and cash receipts for casual workers. I believed this was important to ensure that the same mistakes were not repeated
Since the first prosecution, we now ensure that all casual staff (new and existing) sign employment contracts and sign cash receipts confirming that amounts match their payslips each time they collect their pay. Managers are provided with staff entry checklists to ensure all documents are signed and collected for more accurate and comprehensive record keeping.
In late January 2016 I met with Timothy Lee because I was informed by other staff that Timothy was planning to make a complaint to FWO. In good faith, I attempted to communicate with him with the aim of addressing and rectifying any concerns he had.
On 25 May 2016 I was disappointed to learn that FWO were commencing a new investigation. Despite this, I remained committed to being cooperative with the FWO. I felt disappointed that the FWO seemed more determined to prosecute us than to resolve or even clarify what the issues the two employees had with their employment. This was especially frustrating since we were still engaged in the court-ordered audit process and were actively trying to fix our past mistakes
…
I do wish to express my apologies to Timothy and Natasha if any inadvertent mistakes that were made of my part, had caused any negative impact. I hope they would accept that I have made efforts to rectify their claims.
I acknowledge that prior to the first investigation and prosecution, I had focused too much on restaurant operations and growth, and not nearly enough on payroll procedures, which I acknowledge were lacking at the time. I believe that since the audit process, our payroll and record keeping procedures have greatly improved, where I can be assured that any of the mistakes that have occurred previously will not be repeated.”
c)The third respondent, Alan Wing-Keung Au, stated as follows:
“I deeply regret our mistakes of the past and feel remorseful for the unintentional harm it had caused some of our employees. I am also sorry for any inadvertent harm caused to Timothy and Natasha and regret that we were not able to address their concerns sooner.
…
Since the first prosecution, a court ordered third party audit of our payroll was completed to ensure compliance with the Restaurant Award. While identified deficiencies were rectified immediately, the report identified improvement areas primarily around casual employee payroll record keeping and documentation. To avoid further recurrence of similar proceedings the business has been actively working on ensuring implementation of these recommendations. We have invested significant time and energy into ensuring we are compliant. This includes implementation of employment contracts for all new and existing casual staff, and signed cash receipts during pay collection. Staff entry checklists have also been introduced to help ensure completeness of documentation for all new employees. We are also discussing the opportunity to engage further professional review of our payroll processes and procedures to identify any further shortfalls.”

(iii) Cooperation

I also accept the respondents’ submission that the respondents engaged cooperatively with the FWO both in the rectification of their contraventions and in the litigation that ensued. I also accept the respondents’ submission that they actively sought to rectify their systems and processes, identify any mistakes or errors and compensate for any underpayments identified prior to the commencement of the proceeding before this Court.
I do note the respondents’ early Application in a Case seeking orders to stay this proceeding and declarations to the effect that the FWO be estopped from prosecuting the respondents for conduct alleged by the respondents which should have been the subject of the First Proceeding.

(iv) Deterrence

In relation to general deterrence, I accept that the restaurant and hospitality industry is notorious for noncompliance with the FW Act in relation to the payment of wages and entitlements to its employees. In Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate Construction, Forestry, Mining and Energy Union v Director, Fair Work Building Industry Inspectorate [2015] HCA 46, Keane J stated at [110] as follows:
“110. It is because the Commissioner may, on occasion, be too pragmatic in taking such a stance that the court must exercise its function to ensure that the penalty imposed is just, bearing in mind competing considerations of principle, including that of equality before the law and the need to maintain effective deterrence to other potential contraveners. In this latter regard, in Australian Competition and Consumer Commission v TPG Internet Pty Ltd [146], French CJ, Crennan, Bell and Keane JJ approved the statement by the Full Court of the Federal Court in Singtel Optus Pty Ltd v Australian Competition and Consumer Commission [147] that a civil penalty for a contravention of the law:
"must be fixed with a view to ensuring that the penalty is not such as to be regarded by [the] offender or others as an acceptable cost of doing business".”
In Fair Work Ombudsman v Transpetrol TM AS [2019] FCA 400 at [98] Rares J stated as follows in relation to civil pecuniary penalties:
“98. The principal purpose of civil pecuniary penalties is to promote the public interest in compliance with the provisions in the enactment that the contravenor has infringed by putting a sufficiently high price on contravention “to deter repetition by the contravenor and by others who might be tempted to contravene the Act”: Director 258 CLR at 506 [55], per French CJ, Kiefel, Bell, Nettle and Gordon JJ…”
Further, at [105] Rares J stated:
“105. Ordinarily, the public denunciation by a court of a wrongdoer’s conduct that contravened the law by imposing a civil pecuniary penalty and or making declarations, has the salutary effect of bringing to the market’s and community’s attention the need to comply with the law and to warn of the severity and likelihood of punishment for later infractions…”
The parties have agreed to declarations in respect of the contraventions. The respondents have also agreed to an order requiring the respondents to provide each of its employees with a copy of any orders or reasons published by the Court; a copy of the Fair Work Information Statement in the language of the employees choice; and, a letter in a form to be provided to the Court by the FWO providing the employees with information on the current rates of pay under the Restaurant Award. Those orders and the declarations constitute a public denunciation by the Court of the respondents’ contravening conduct.
I am satisfied that no further specific deterrence is necessary in this case beyond the Declarations and Ancillary Orders. The respondents were required to pay penalties in the First Proceeding in respect of the same contravening conduct.

H. Conclusion

I am not satisfied that it is appropriate to impose a further penalty on the respondents in respect of the contraventions the subject of this proceeding in the light of the First Proceeding and its relevant chronology to the proceeding before this Court as well as having regard to the respondents’ profound expressed remorse, cooperation and corrective conduct.
I am also satisfied that the admitted contraventions of s.125 of the FW Act and reg.3.44(6) of the FW Regulations are more appropriately dealt with by the making of the agreed declarations and ancillary orders only. Accordingly, I do not propose to make any further order in respect of those contraventions.
The parties have agreed to the following Declarations and Ancillary Orders which should be made:

Declarations

The Second Respondent (Joon Hoe Lee, also known as "Clement Lee"), the Third Respondent (Julian Lee) and the Fourth Respondent (Alan Wing-Keung Au) were involved, pursuant to section 550 of the FW Act, in Mamak's contraventions of the following civil remedy provisions of the FW Act and the FW Regulations:
i)Section 45 of the FW Act, by failing to pay each of the Employees the minimum rates of pay required by clauses 20.1 and A.2.5 of Schedule A to the Restaurant Award.
ii)Section 45 of the FW Act, by failing to pay each of the Employees the casual loading required by clauses 13.1 and A.5.4 of Schedule A to the Restaurant Award.
iii)Section 45 of the FW Act, by failing to pay each of the Employees the Saturday penalty rates required by clause 34.1 of the Restaurant Award.
iv)Section 45 of the FW Act, by failing to pay each of the Employees the Sunday penalty rates required by clauses 34.1 and A.7.3 of Schedule A to the Restaurant Award.
v)Section 45 of the FW Act, by failing to pay each of the Employees the public holiday penalty rates required by clause 34.1 of the Restaurant Award.
vi)Section 45 of the FW Act, by failing to pay each of the Employees additional penalty amounts for work performed between 10:00 pm and midnight on Monday to Friday as required by clauses 34.2 and A.7.3 of Schedule A to the Restaurant Award.
vii)Section 535(1) of the FW Act, by failing to keep records that Mamak was required to keep under the FW Act and the FW Regulations for 7 years.
viii)Section 536(2) of the FW Act, by failing to ensure that pay slips that it gave to the Employees included information prescribed by the FW Regulations.
ix)Regulation 3.44(1) of the FW Regulations, by making and keeping employee records in relation to Mr Timothy Lee's Employment Period, knowing that those records were false or misleading.
x)Regulation 3.44(1) of the FW Regulations, by making and keeping employee records in relation to Ms Ibrahim's Employment Period, knowing that those records were false or misleading.
xi)Regulation 3.44(6) of the FW Regulations, by making use of entries in the employee records in relation to Mr Timothy Lee's Employment Period, by providing those records to the offices of the FWO on 3 June 2016, knowing that those records were false or misleading.
xii)Regulation 3.44(6) of the FW Regulations, by making use of entries in the employee records in relation to Ms Ibrahim's Employment Period, by providing those records to the offices of the FWO on 24 November 2016, knowing that those records were false or misleading.
xiii)Section 535(2) of the FW Act, by failing to keep records that Mamak was required to keep under the FW Act that included information prescribed by the FW Regulations.
xiv)Section 44(1) of the FW Act, by failing to provide the Fair Work Information Statement to each of the Employees as required by section 125(1) of the FW Act.

Ancillary Orders

An order pursuant to section 545(1) of the FW Act requiring the Second, Third and Fourth Respondent within 30 days of the date of this order, to provide to each of the employees employed by Mamak Haymarket Pty Ltd (ACN 615 890 607), Mamak Chatswood Pty Ltd (ACN 615 890 590), Mamak Melbourne Pty Ltd (ACN 615 893 000), Mamak Marrickville Pty Ltd (ACN 615 894 758) and Mamak Australia Pty Ltd (ACN 615 885 188) with:
i)A copy of any orders made and any reasons published by the Court.
ii)A copy of the Fair Work Information Statement, in a language of the employee’s choice.
iii)A letter providing the employees with information on the current rates of pay under the Restaurant Award.

I certify that the preceding seventy-five (75) paragraphs are a true copy of the reasons for judgment of Judge Emmett

Deputy Associate:

Date: 11 December 2019

[2019] FCCA 3582

11 December 2019

Key Legal Topics

Areas of Law

Employment Law

Insolvency

Statutory Interpretation

Legal Concepts

Breach

Statutory Construction

Intention

Remedies