FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Fair Work Ombudsman v New Switch Electrical Pty Ltd [2024] FedCFamC2G 1124
File number: MLG 576 of 2024 Judgment of: JUDGE SYMONS Date of judgment: 1 November 2024 Catchwords: INDUSTRIAL LAW – Fair Work – application for default judgment pursuant to rule 13.05(2)(c) of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) – applicant seeking declaration of contravention of the Fair Work Act 2009 (Cth) by reason of failure of first respondent to comply with compliance notice – applicant seeking declaration that second respondent involved in the contravention and liable as an accessory – acts of default established – statement of claim establishes basis for declarations – where applicant seeks orders that would require first respondent to make payment to employee of specified amount identified as underpayment – where question of relief to be addressed at hearing on penalty Legislation: Fair Work Act 2009 (Cth), ss 12, 14, 87, 90, 550, 700, 716
Electrical, Electronic and Communications Contracting Award 2020, cll 16.3, 21.4
Federal Circuit and Family Court of Australia (General Federal Law) Rules 2021 (Cth), rr 1.06, 4.03, 4.04, 6.01, 13.04, 13.05
Federal Court Rules 2011 (Cth)
Federal Court Rules 1979 (Cth)
Cases cited: Australian Competition and Consumer Commission v Dataline.net.au Pty Ltd (2006) 236 ALR 665; [2006] FCA 1427
Australian Competition and Consumer Commission v MSY Technology Pty Ltd (2012) 201 FCR 378; [2012] FCAFC 56
Fair Work Ombudsman v Carers Portland Inc [2023] FedCFamC2G 620
Fair Work Ombudsman v Cobra Security Services Pty Ltd [2024] FedCFamC2G 336
Fair Work Ombudsman v Double Hao International Pty Ltd [2024] FedCFamC2G 343
Fair Work Ombudsman v Taing [2024] FedCFamC2G 270
Macquarie Bank Limited v Seagle (2005) 146 FCR 400; [2005] FCA 1239
Phonographic Performance Ltd v Maitra (1998) 41 IPR 225; [1998] 2 All ER 638
Rathner; in the matter of Mildura Grand Pty Ltd (in liq) v Bendigo Skyrider Pty Ltd [2011] FCA 626
Division: Division 2 General Federal Law Number of paragraphs: 38 Date of last submissions: 31 October 2024 Date of hearing: 31 October 2024 Place: Melbourne Solicitor for the applicant: Ms A Mitchell Respondents: No appearance ORDERS
MLG 576 of 2024 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: FAIR WORK OMBUDSMAN
Applicant
AND: NEW SWITCH ELECTRICAL PTY LTD (ACN 646 823 396)
First Respondent
MARK LADORES TAN
Second Respondent
ORDER MADE BY:
JUDGE SYMONS
DATE OF ORDER:
31 OCTOBER 2024
THE COURT DECLARES THAT:
1.Upon admissions taken to have been made by reason of the first and second respondents’ default pursuant to rule 13.04(2) of the Federal Circuit and Family Court of Australia (General Federal Law) Rules 2021 (Cth) (Rules):
(a)the first respondent contravened section 716(5) of the Fair Work Act 2009 (Cth) (FW Act) by failing to comply with the compliance notice issued on 16 December…
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- Case
- [2024] FedCFamC2G 1124
- Decision Date
CaseChat Overview and Summary
The primary legal issues before the court were whether the FWO's statement of claim complied with the rules of pleading and whether it properly pleaded a cause of action against both New Switch and Mr Tan. Additionally, the court had to consider whether it was appropriate to grant declaratory relief in the absence of a contradictor and whether the FWO's proposed orders for payment and interest were permissible.
The court found that the FWO's statement of claim complied with the rules of pleading and adequately established a cause of action against both New Switch and Mr Tan. It was satisfied that the facts alleged in the statement of claim established that both entities contravened section 716(5) of the Fair Work Act. The court noted that it had a wide discretion to make declarations, including in circumstances where a respondent had defaulted. It concluded that this was an appropriate case for declaratory relief, particularly to mark the court’s disapproval of the contravening conduct. However, the court highlighted that the declarations would be made upon admissions taken to have been made by the respondents due to their non-compliance with the rules of court. The court also found that orders requiring New Switch to comply with the compliance notice and for payment of interest were not appropriate in this context, aligning with recent jurisprudence.
The court ordered that declarations be made against New Switch and Mr Tan, establishing their contravention of the Fair Work Act and their respective liabilities. The court refrained from making orders for specified payments and interest at this stage, noting that these matters would be addressed at a later hearing on penalty.
Orders
Orders of the court
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Background
Background to the litigation
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Evidence
Evidence Before The Court
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Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
I am satisfied that the statement of claim filed in this matter and upon which the applicant relies complies with the rules of pleading and properly pleads a cause of action against both New Switch and Mr Tan. In particular, I am satisfied that the facts alleged in the statement of claim establish that both New Switch and Mr Tan contravened s 716(5) of the FW Act.Should declarations be made? It is not in doubt that this Court has a wide discretion to make declarations, including in circumstances where due to an act of default, a respondent is deemed to have made admissions. In this respect, there is no requirement, as there once was, for there to be a proper contradictor before declaratory relief can be granted. The requirement for a contradictor is met if there is a party who had an interest to oppose the declaratory relief that was being sought.[15] However, it has been recognised that when considering declaratory relief in cases such as the present, the particular characteristics of an application for default judgment should be borne in mind. In particular, default judgment is given on the basis of the claim as pleaded by the applicant and in the absence of a defence or contradictory evidence. Accordingly, as the FWO by its proposed form of declarations has recognised, it is appropriate to make clear that there has been no adjudication on the merits of the applicant’s claims by including wording in the declaration to the effect that the declarations are made “upon admissions which the respondent in question is taken to have made consequent upon their non-compliance with the requirements of the rules of Court”, as suggested by Kiefel J (as her Honour then was) in Australian Competition and Consumer Commission v Dataline.net.au Pty Ltd [2006] FCA 1427 at [59].[15] Australian Competition and Consumer Commission v MSY Technology Pty Ltd [2012] FCAFC 56 at [30] per Greenwood, Logan and Yates JJ. I am satisfied that this is an appropriate case for declaratory relief, if for no other reason than to mark the Court’s disapproval of the contravening conduct.Orders requiring New Switch to comply with the requirements of the compliance notice and for payment of interest As recorded earlier, the FWO seeks orders that would require New Switch to make a payment of a specified amount said to be referable to the underpayment contraventions alleged in the compliance notice (identified as the “outstanding amount”). The FWO also seeks an order for the payment of any additional superannuation arising from the outstanding amount as well as interest on the outstanding amount. The FWO appears to suggest that these orders can be made under s 545(1) of the Act. This position has in recent times been questioned and there are several decisions of this Court that suggest that an order requiring payment by an employer of a predetermined amount is not one that can or should be made in compliance notice proceeding.[16] [16] For example, Fair Work Ombudsman v Carers Portland Inc [2023] FedCFamC2G 620; Fair Work Ombudsman v Cobra Security Services Pty Ltd [2024] FedCFamC2G 336; Fair Work Ombudsman v Taing [2024] FedCFamC2G 270 and Fair Work Ombudsman v Double Hao International Pty Ltd [2024] FedCFamC2G 343.