Fair Work Ombudsman v No Land Tax Incorporated
[2017] FCCA 2471
•6 December 2017
FEDERAL CIRCUIT COURT OF AUSTRALIA
| FAIR WORK OMBUDSMAN v NO LAND TAX INCORPORATED & ANOR | [2017] FCCA 2471 |
| Catchwords: INDUSTRIAL LAW – Determination of penalties to be imposed in relation to admitted contraventions – Relevant principles – Whether intention not to pay workers. |
| Legislation: Crimes Act 1914 (Cth), 4AA Fair Work Act 2009, ss.12, 293, 323, 535, 539, 542,545, 546, 550(2), 557, 712. Fair Work Regulations 2009, rr.3.32, 3.33 |
| Cases cited: ACE Insurance Limited v Trifunovski (No.2) [2012] FCA 793 |
| Applicant: | FAIR WORK OMBUDSMAN |
| First Respondent: | NO LAND TAX INCORPORATED |
| Second Respondent: | PETER JONES |
| File Number: | SYG 2204 of 2015 |
| Judgment of: | Judge Altobelli |
| Hearing date: | 27 September 2017 |
| Date of Last Submission: | 27 October 2017 |
| Delivered at: | Sydney |
| Delivered on: | 6 December 2017 |
REPRESENTATION
| Counsel for the Applicant: | Ms Brigden |
| Solicitors for the Applicant: | Office of the Fair Work Ombudsman |
| Counsel for the Respondents: | Mr Stewart |
| Solicitors for the Respondents: | Gillis Delaney Lawyers |
THE COURT ORDERS BY CONSENT THAT:
Pursuant to subsection 545(2)(b) and section 550 of the FW Act that the First and Second Respondents, jointly and severally, pay [G] and [D] their SNC Entitlements as set out in Schedule 1 within 28 days of the date of this order.
The First and Second Respondent pay penalties under subsection 539(2) of the FW Act in respect of the contraventions identified.
Under subsection 546(3)(a) of the FW Act, the penalties be paid to the Commonwealth within 28 days of the date of this order.
The First Respondent will, within three months of the date of the order, undertake a wages and entitlements audit for all employees engaged by the First Respondent on Election Day, to assess compliance with the FW Act, including but not limited to:
(a)the correct identification of each employee’s status of engagement and hours worked;
(b)the minimum entitlements that have been paid to each employee; and
(c)that each employee has received a pay slip.
The First Respondent will, within three months of the date of this order, provide to the Applicant:
(a)a copy of the audit report which will include a statement of the methodology used in the audit; and
(b)written details of any contraventions identified in the audit, the steps the First Respondent will take to rectify any identified contravention(s) and the date by which the rectification will occur.
The Applicant have liberty to apply on seven days’ notice in the event that any of the preceding orders are not complied with.
THE COURT FURTHER ORDERS THAT:
The penalty for the purposes of Order 2 above are to be:
(a)In relation to the First Respondent: $67,575
(b)In relation to the Second Respondent: $13,315.
Pursuant to s88F of the Federal Circuit Court of Australia Act 1999, publication of the names of the unpaid workers in this case (at paragraphs 15, 19, 26, 71, 74 and 109 of these reasons for Judgement) and of the email addresses of the Second Respondent (at paragraph 54 and 57 of these reasons for Judgement) is not to be published outside of the reasons for judgement provided to the parties.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 2204 of 2015
| FAIR WORK OMBUDSMAN |
Applicant
And
| NO LAND TAX INCORPORATED |
First Respondent
| PETER JONES |
Second Respondent
REASONS FOR JUDGMENT
INTRODUCTION
This case is about 21 ordinary Australian workers who were not paid for working on New South Wales Election Day on 28 March 2015. The youngest is only 14 years old. This was his first job. He was hoping to use his pay to buy his first drone to participate in competitions. He was “really disappointed” not to get paid. One of the workers was a receptionist and she was counting on the pay to meet household bills. She has “lost trust in elections and politicians”. Another unpaid worker was left feeling “taken advantage of” and that she could no longer trust people at face value. One worker chose to work on Election Day to earn money to pay her rent. She found the experience “horrible” and lost trust in people at face value. Yet another unpaid worker was in a difficult financial situation and was relying on the money that she was told would be paid.
THE AGREED FACTS
The parties agreed to the facts set out in paragraphs 3 to70 below.
THE APPLICATION
On 10 August 2015, the Applicant filed an Application and Statement of Claim in this Court against the First and Second Respondents in respect of various contraventions of the Fair Work Act (Cth) (FW Act), including underpayments of safety net contractual entitlements to 21 employees, named in paragraph 14 below, (Employees) who were employed by the First Respondent to hand out how to vote cards at the New South Wales election held on 28 March 2015 (Proceeding).
From 27 July 2016 to 19 August 2016, the Applicant filed its evidence in the Proceeding.
On 19 December 2016, the Applicant filed an Amended Statement of Claim in these proceedings (ASOC).
All defined terms contained in the ASOC apply to these agreed facts.
ADMITTED CONTRAVENTIONS
The First Respondent admits to contravening the following civil remedy provisions of the FW Act:
a)section 293 of the FW Act by failing to pay the Employees the national minimum wage for the hours each Employee worked on Election Day;
b)section 542 of the FW Act, by failing to pay the Employees their safety net contractual entitlements;
c)section 323 of the FW Act by failing to pay wages in full, in the prescribed method;
d)subsection 535(1) of the FW Act by failing to make, and keep for seven years, employee records pursuant to subsection 535(1) of the FW Act; and
e)subsection 712(3) of the FW Act, by failing to comply with a notice to produce records or documents.
The Second Respondent admits that he was, for the purposes of subsection 550(2) of the FW Act, involved in each of the First Respondent’s contraventions of the FW Act set out in paragraph 7 above.
The First and Second Respondents admit that the underpayment contravention in subparagraphs 7.a) and 7.b) above resulted in the First Respondent underpaying the Employees a total aggregate amount of $6,219.90 (Total Underpayment), with individual underpayments to each of the employees as set out in Annexure A.
The Rectification of Underpayments
In relation to the underpayment contraventions referred to in subparagraphs 7(a) and 7(b) above, as at the date of the hearing:
a)the First Respondent has paid 19 of the 21 Employees the respective amounts due, as set out in Schedule 1; and
b)the First Respondent has not paid 2 of the 21 Employees the respective amounts due, as set out in Schedule 1, because it does not have sufficient information to make payment, but it is continuing its efforts to locate the relevant Employees.
THE PARTIES AND THE EMPLOYEES
The Applicant
The Applicant is:
a)appointed by the Governor-General by written instrument to the office of the Fair Work Ombudsman, pursuant to section 687 of the FW Act;
b)a Fair Work Inspector pursuant to section 701 of the FW Act; and
c)a person with standing and authority to bring these proceedings pursuant to section 539 of the FW Act.
The First Respondent
The First Respondent is and was at all relevant times:
a)an incorporated association pursuant to the Association Incorporation Act 2009 (NSW) and able to sue and be sued in its own name;
b)a political party whose candidates stood for election at the New South Wales Election held on 28 March 2015 (Election Day) and;
c)a national system employer under section 30N of the FW Act.
The First Respondent was the employer of the Employees.
The Second Respondent
The Second Respondent is and was at all relevant times:
a)the Secretary of the First Respondent;
b)the First Respondent’s lead Upper House Candidate at the New South Wales Election in 2015;
c)the First Respondent’s apparent and/or actual authorised spokesperson to the public and the Employees both prior to and after the Election;
d)responsible for the employment and remuneration of the First Respondent’s employees;
e)a former trade union official and/or former employee of a trade union; and
f)by reason of the matters agreed in this paragraph, responsible in a practical sense for ensuring that the First Respondent complied with its legal obligations to its employees under the FW Act.
THE EMPLOYMENT
The Employees
The First Respondent employed the following Employees:
| [A] | [L] |
| [B] | [M] |
| [C] | [N] |
| [D] | [O] |
| [E] | [P] |
| [F] | [Q] |
| [G] | [R] |
| [H] | [S] |
| [I] | [T] |
| [J] | [U] |
| [K] |
The Employees were engaged to work for one day only on Election Day.
The Employees were employed on a casual basis by the First Respondent to hand out how to vote cards on Election Day.
The Employees were both junior and adult employees as at Election Day, for the purposes of the National Minimum Wage Order 2014, and were deployed to various polling booths across New South Wales on Election Day.
The Employees are categorised, as follows:
| Name | Adult/Age (if junior employee) | Name | Adult/Age (if junior employee) |
| [A] | Adult | [L] | Adult |
| [B] | Adult | [M] | Adult |
| [C] | Adult | [N] | Adult |
| [D] | 19 | [O] | 19 |
| [E] | Adult | [P] | Adult |
| [F] | Adult | [Q] | 17 |
| [G] | Adult | [R] | Adult |
| [H] | Adult | [S] | Adult |
| [I] | 19 | [T] | Adult |
| [J] | 19 | [U] | Adult |
| [K] | 14 |
Contract of employment
Each of the Employees held a contract of employment with the First Respondent (‘the contract’).
The contract was express and implied, in written form. To the extent that it was express, it was contained in cards/flyers sent by the First Respondent in the mail in or around March 2015, offering employment on Election Day.
The flyer/card stated as follows:
·“Earn $30 an hour;
·Plus a possible bonus of up to $500;
·From 7am to 6pm on Saturday 28 March;
·With a one hour break Must be good with people – outgoing and enthusiastic”.
The Employees accepted the employment by registering to work on the First Respondent’s website.
The contract, and its terms, was further contained in a leaflet sent on behalf of the First Respondent to the Employees at their home address prior to Election Day. The leaflet stated, inter alia:
“ABOUT YOUR PAY & BONUS
We receive $7 from the NSW Electoral Commission for every vote that the No Land Tax Party receives (not a very good use of your taxes - but they’re the rules). We are using this money from the government to pay your bonuses – so the more “how-to-votes” you hand out…the more likely you will receive a larger bonus.
If your local No Land Tax candidate gets 10% of the vote – you will get a $200 bonus.
If they get 20% you will get a $500 bonus.
Your base pay is $30 an hour – you will get paid this regardless of what vote your local candidate obtains...”
To the extent that it was implied, it is to be inferred from the conduct of the Employees, who worked the hours set out in paragraph 26 below.
Hours of work
The Employees worked between 9.5 and 10 hours on Election Day with a one hour break. The Employees’ hours of work were as set out below:
| Name | Start | Finish | Meal break | Hours Worked |
| [B] | 7:00 | 18:00 | 1 | 10 |
| [C] | 7:00 | 18:00 | 1 | 10 |
| [D] | 7:00 | 18:00 | 1 | 10 |
| [E] | 7:00 | 18:00 | 1 | 10 |
| [F] | 7:00 | 18:00 | 1 | 10 |
| [L] | 7:00 | 18:00 | 1 | 10 |
| [M] | 7:00 | 18:00 | 1 | 10 |
| [N] | 7:00 | 18:00 | 1 | 10 |
| [P] | 7:20 | 18:00 | 1 | 9.67 |
| [A] | 7:15 | 18:00 | 1 | 9.75 |
| [Q] | 7:00 | 18:00 | 1 | 10 |
| [O] | 7:00 | 18:00 | 1 | 10 |
| [T] | 7:30 | 18:00 | 1 | 9.5 |
| [G] | 7:10 | 18:00 | 1 | 9.83 |
| [R] | 7:00 | 18:00 | 1 | 10 |
| [S] | 7:00 | 18:00 | 1 | 10 |
| [I] | 7:00 | 18:00 | 1 | 10 |
| [H] | 7:30 | 18:00 | 1 | 9.5 |
| [U] | 7:30 | 18:00 | 1 | 9.5 |
| [K] | 7:15 | 18:00 | 1 | 9.75 |
| [J] | 7:10 | 18:00 | 1 | 9.83 |
THE FW ACT
At all relevant times, the First Respondent was bound by the FW Act in respect of the employment of the Employees.
ADMITTED CONTRAVENTIONS
Contravention 1: The National Minimum Wage Order
At all material times, the National Minimum Wage Order 2014 applied to the Employees as award/agreement free employees as defined in section 12 of the FW Act.
Pursuant to clause 4.2 of the National Minimum Wage Order 2014, the Employees were award/agreement free employees.
The First Respondent was required to pay at least the national minimum wage in accordance with the National Minimum Wage Order 2014 (as defined in section 12 of the FW Act) in respect of the Employees’ employment.
Pursuant to Clause 4.1 of the National Minimum Wage Order 2014, the national minimum wage rate was $640.90 per week, calculated on the basis of a week of 38 ordinary hours, or $16.87 per hour for adult employees.
Pursuant to Clause 8.2 of the National Minimum Wage Order 2014, junior employees were entitled to the following as a percentage of the adult rate:
| Age | % of rate of pay in clause 4.1 |
| Under 16 years of age | 36.8 |
| At 16 years of age | 47.3 |
| At 17 years of age | 57.8 |
| At 18 years of age | 68.3 |
| At 19 years of age | 82.5 |
| At 20 years of age | 97.7 |
Pursuant to Clause 5.1 of the National Minimum Wage Order 2014, the Employees were entitled to be paid a casual loading of 25%.
The First Respondent underpaid the Employees a total amount of $4006.66 based on the Employees’ entitlements under the National Minimum Wage Order 2014. Schedule 1 sets out the total underpayment details.
By reason of the matters set out in paragraphs 15 to 34 above, the First Respondent contravened the National Minimum Wage Order 2014.
Contravention 2: Safety Net Contractual Entitlement
The Employees had a contractual entitlement to wages which exceeded the statutory minimum hourly rate of pay due to the Employees.
At all relevant times, the Employees had a contractual entitlement to an hourly rate of pay of $30 per hour as set out in paragraph 21.
The contractual entitlement above constituted a Safety Net Contractual Entitlement (SNC Entitlement) within the meaning of section 12 of the FW Act.
Pursuant to section 542 of the FW Act, the SNC Entitlement is taken to be an entitlement of the Employees under the FW Act.
The First Respondent failed to pay the Employees their SNC Entitlement in relation to the relevant contractual rate of pay.
The Employees’ hours of work and amounts owing to each Employee for time worked are set out in Schedule 1.
By reason of the matters set out in paragraphs 15 to 34 and 36 to 41 above the First Respondent contravened section 542 of the FW Act by failing to pay the Employees their SNC Entitlement.
Contravention 3: section 323 of the FW Act
At all material times, the First Respondent was required by subsection 323(1) of the FW Act to pay the Employees in relation to the performance of work:
a)in full;
b)in money by one, or a combination, of the methods referred to in subsection 323(2) of the FW Act; and
c)at least monthly.
The First Respondent failed to pay the Employees in full, in money by one, or a combination, of the methods referred to in subsection 323(2) of the FW Act.
By reason of the matters set out in paragraphs 15 to 34, 43 and 44 above, the First Respondent contravened subsection 323(1) of the FW Act by failing to pay the Employees in full, in money by one, or a combination, of the methods referred to in subsection 323(2).
Contravention 4: section 535 of the FW Act
Pursuant to subsection 535(1) of the FW Act, at all relevant times the First Respondent was required to make, and keep for seven years, employee records of the kind prescribed by the Fair Work Regulations 2009 (‘FW Regulations’) in relation to the Employees.
Pursuant to subsection 535(2) of the FW Act, the records referred to in subsection 535(1) of the FW Act must include any information prescribed by the regulations.
Pursuant to regulations 3.32(c) and (d) of the FW Regulations, the records referred to in subsection 535(1) of the FW Act must state whether the employee’s employment is full-time or part-time and whether the employee’s employment is permanent, temporary or casual.
Pursuant to regulation 3.33(2) of the FW Regulations, the records referred to in subsection 535(1) of the FW Act require that if the employee is a casual or irregular part-time employee who is guaranteed a rate of pay set by reference to a period of time worked, the record must set out the hours worked by the employee.
The First Respondent did not make, and keep for seven years, employee records pursuant to subsection 535(1) of the FW Act.
By reason of the matters agreed at paragraphs 46 to 50 above, the First Respondent contravened subsection 535(1) of the FW Act which is a civil remedy provision pursuant to section 539 of the FW Act.
Contravention 5: section 712 of the FW Act
Pursuant to:
a)subsection 712(1) of the FW Act, a Fair Work Inspector may require a person, by notice, to produce a record or document to the Fair Work Inspector (Notice);
b)subsection 712(2) of the FW Act, the Notice must:
i)be in writing;
ii)be served on the person; and
iii)require the person to produce the record or document at a specified place within a specified period of at least 14 days;
c)subsection 712(3) of the FW Act, the First Respondent was required to comply with a Notice which was served on the First Respondent.
On 10 April 2015, Inspector Dougall required the First Respondent, by Notice under section 712 of the FW Act, to produce certain documents and/or records to the Applicant by 4 May 2015 (the NTP).
In particular the NTP:
a)was in writing and dated 10 April 2015;
b)was served in person on the Second Respondent on 10 April 2015 at the Applicant’s Canberra Office;
c)was also sent by email to the Second Respondent at (omitted) and (omitted);
d)required the First Respondent to produce the records and/or documents to Level 12, 255 Elizabeth St Sydney, the offices of the Applicant, by 4 May 2015.
The First Respondent failed to fully comply with the NTP by 4 May 2015.
The First Respondent did not produce the following categories of documents as required by the NTP by 4 May 2015 or at all:
a)Paragraph 1(d) of the NTP: “Any records or documents (including letters, emails, text messages or notes of meetings or telephone discussions) relating to offers of employment to any workers engaged to perform work on 28 March 2015”;
b)Paragraph 7 of the NTP: “A record of the names and details for each of the Committee members of the No Land Tax Campaign and the name of the Public Officer of the No Land Tax Campaign”; and
c)Paragraph 8 of the NTP: “All documents or records (including minutes of Committee meetings, file notes, emails or other memoranda) relating to No Land Tax Campaign’s decision to engage workers to perform work on 28 March 2015 at the New South Wales State Elections, including any document or record relating to the recruitment of workers or the remuneration to be paid to the workers”.
On 4 May 2015 the Second Respondent, on behalf of the First Respondent, sent an email to Fair Work Inspector Dougall of the Applicant from (omitted) and requested an extension to comply with the NTP. In the email, the Second Respondent stated that the First Respondent had not been able to fully comply with the NTP.
On 5 May 2015, Fair Work Inspector Dougall of the Applicant sent a reply email to the Second Respondent, in respect of the failure to comply with the NTP. The email stated that an extension was not granted. Fair Work Inspector Dougall encouraged the First Respondent to collate any relevant existing documents for production to the Applicant and provide written reasons as to why the documents were not provided within the required timeframe.
No further documents were received by the Applicant from the First Respondent.
As at the date of this SOAF, the First Respondent has not:
a)fully complied with the NTP; or
b)provided a reasonable excuse for failure to comply with the NTP.
By reason of the matters agreed in paragraphs 52 to 60 above the First Respondent contravened subsection 712(3) of the FW Act by failing to comply with the NTP.
ADMITTED ACCESSORIAL LIABILITY OF THE SECOND RESPONDENT
At all material times, the Second Respondent was responsible for ensuring the First Respondent complied with the FW Act in respect of the Employees’ entitlements, the record keeping provisions and the Notice to Produce issued on the First Respondent. In particular:
a)The Second Respondent was the Secretary of the First Respondent;
b)The Second Respondent was the lead Candidate and spokesperson of the First Respondent;
c)The Second Respondent was involved in the recruitment of the Employees;
d)The Second Respondent was a person who knew that the First Respondent was required to comply with Commonwealth workplace relations legislation;
e)The Second Respondent was a person who knew that the First Respondent was required to pay at least the minimum wages of the Employees;
f)The Second Respondent was a person who was involved in the Applicant’s investigation and was served with the NTP; and
g)The Second Respondent knew, determined and directed the extent to which the First Respondent complied, or failed to comply with, the NTP.
The Second Respondent was aware of the failure to pay the wages and/or statutory entitlements of the Employees as set out in paragraphs 28 to 45 above.
The Second Respondent communicated his awareness of the First Respondent’s non-payment of wages in writing through emails to the Employees, including but not limited to the following emails in respect of wages owing and payslips:
a)28 March 2015;
b)31 March 2015;
c)1 April 2015;
d)11 April 2015;
e)16 April 2015;
f)22 April 2015; and
g)16 May 2015.
The Second Respondent communicated his awareness of the First Respondent’s non-payment of wages in the Media, including on radio and in print media on the following dates:
a)14 April 2015 (The Australian); and
b)17 April 2015 (2GB Radio)
The Second Respondent failed to ensure that the said wages and/or statutory entitlements of the Employees were paid in a timely manner, or at all.
By reason of the matters set out in paragraphs 15 and 61 to 66 above, the Second Respondent:
a)had actual knowledge of the factual matters which comprise each of the contraventions by the First Respondent; and
b)was an intentional participant in the factual matters which comprise the contraventions by the First Respondent.
By reason of the matters agreed in paragraphs 62 to 67 above the Second Respondent admits he was involved in each of the admitted contraventions of the First Respondent set out in paragraph 7 above in that he:
a)aided, abetted, counselled or procured the contraventions;
b)induced the contraventions; or
c)was either directly or indirectly knowingly concerned in or party to the contraventions.
AGREED RELIEF
Declarations sought by consent
The parties seek the following declarations by consent that the First Respondent contravened:
a)section 293 of the FW Act by failing to pay the Employees the national minimum wage for the hours each Employee worked on Election Day;
b)section 542 of the FW Act, by failing to pay the Employees their safety net contractual entitlements;
c)section 323 of the FW Act by failing to pay wages in full, in the prescribed method;
d)subsection 535(1) of the FW Act by failing to make, and keep for seven years, employee records pursuant to subsection 535(1) of the FW Act; and
e)subsection 712(3) of the FW Act, by failing to comply with a notice to produce records or documents.
A declaration that the Second Respondent was, for the purposes of subsection 550(2) of the FW Act, involved in each of the First Respondent’s contraventions identified above.
Orders sought by consent
The parties request that the following orders be made by consent pursuant to section 545(1):
a)An order pursuant to subsection 545(2)(b) and section 550 of the FW Act that the First and Second Respondents, jointly and severally, pay [G] and [D] their SNC Entitlements as set out in Schedule 1 within 28 days of the date of the order.
b)An order that the First and Second Respondent pay penalties under subsection 539(2) of the FW Act in respect of the contraventions identified in paragraph 6 above.
c)An order under subsection 546(3)(a) of the FW Act that the penalties be paid to the Commonwealth within 28 days of the date of this order.
d)The First Respondent will, within three months of the date of the order, undertake a wages and entitlements audit for all employees engaged by the First Respondent on Election Day, to assess compliance with the FW Act, including but not limited to:
i)the correct identification of each employee’s status of engagement and hours worked;
ii)the minimum entitlements that have been paid to each employee; and
iii)that each employee has received a pay slip.
e)The First Respondent will, within three months of the date of this order, provide to the Applicant:
i)a copy of the audit report which will include a statement of the methodology used in the audit; and
ii)written details of any contraventions identified in the audit, the steps the First Respondent will take to rectify any identified contravention(s) and the date by which the rectification will occur.
f)An order that the Applicant have liberty to apply on seven days’ notice in the event that any of the preceding orders are not complied with.
g)Such further orders as the Court deems appropriate.
A number of injunctions originally sought by the Applicant were not pressed by it at the hearing.
PENALTY
The Applicant seeks the imposition of pecuniary penalties under the Fair Work Act 2009 (Cth) (FW Act) on the First Respondent and on the Second Respondent in his capacity as director of the First Respondent (on an accessorial liability basis), following the acceptance of liability by each of the Respondents on 1 June 2017 of the contraventions of the civil remedy provisions of the FW Act set out in the Statement of Agreed Facts filed 1 June 2017 (SOAF) in respect of the employment of 21 employees named in the SOAF (Employees) for work they carried out on 28 March 2015. The Respondents submit that no monetary penalty should be imposed on either of them.
Evidence relied upon
At the penalty hearing, the Applicant tendered without objection the SOAF, a Payment Detail Report dated 16 May 2017 and read the affidavit of Fair Work Inspector Steven Spiliotopoulos (FWI Spiliotopoulos), together with the following paragraphs of the following affidavits of the employees:
a)[C] sworn 26 July 2016 (paragraphs 1-8, 27-31, 35, 37) ([C] Affidavit).
b)[O] affirmed 26 June 2016 (paragraphs 1-5, 21 to 33) ([O] Affidavit).
c)[S] affirmed 28 July 2016 (paragraphs 1-3, 11-28) ([S] Affidavit).
d)[N] affirmed 9 August 2016 (paragraphs 1-5, 18-36) ([N] Affidavit).
e)[B] affirmed 9 August 2016 (paragraphs 1-4, 20-32) ([B] Affidavit).
f)[R] affirmed 11 August 2016 (paragraphs 1-3, 12-21) ([R] Affidavit).
g)[I] affirmed 11 August 2016 (paragraphs 1-3, 7, 8, 14-27) ([I] Affidavit).
h)[H] affirmed 12 August 2016 (paragraphs 1-3, 8, 14-23) ([H] Affidavit).
i)[M] affirmed 15 August 2016 (paragraphs 1-2, 5, 10, 19-25) ([M] Affidavit).
j)[J] affirmed 8 August 2016 (paragraphs 1-3, 16-28) ([J] Affidavit).
k)[T] affirmed 15 August 2016 (paragraphs 1-3, 9, 12-24) ([T] Affidavit).
l)[L] affirmed 16 August 2016 (paragraphs 1-2, 19-34) ([L] Affidavit).
m)[E] affirmed 16 August 2016 (paragraphs 1-4, 21-38) ([E] Affidavit).
n)[A] affirmed 18 August 2016 (paragraphs 1-6, 12, 23-39) ([A] Affidavit).
o)[U] affirmed 17 August 2016 (paragraphs 1-5, 17-34) ([U] Affidavit).
p)[K] affirmed 17 August 2016 (paragraphs 1-5, 15-25) ([K] Affidavit).
q)[Q] affirmed 16 August 2016 (paragraphs 1-5, 22-34) ([Q] Affidavit).
r)[F] affirmed 18 August 2016 (paragraphs 1-4, 18-33) ([F] Affidavit).
s)Luke Finegan affirmed 23 October 2017;
t)Outline of submissions dated 1 September 2017;
u)Outline of Submissions dated 22 September 2017; and
v)Outline of submissions dated 23 October 2017.
The Respondents relied on the following evidence:
a)Affidavit of Peter Jones affirmed 18 August 2017;
b)Submission dated 18 September 2017;
c)Supplementary submissions dated 27 October 2017; and
d)Affidavit of Peter Jones affirmed 9 October 2017.
The following documents were tendered during the hearing:
| Date | Exhibit No. | Tendered by (eg. A/W, R/H) | Description of Exhibit/MFI |
| 27.9.17 | A1 | A | ANZ Payment detail report |
| A2 | A | Statement of agreed facts |
Principles on Penalty
The approach to be taken by the Court in determining penalty is to:
a)Identify the separate contraventions involved. Each breach of each separate obligation found in the FW Act in relation to each employee is a separate contravention.[1]
b)Consider whether the breaches found constitute a single course of conduct.[2]
c)Consider the extent that two or more contraventions have common elements in considering what is an appropriate penalty in all the circumstances for each contravention. The relevant respondent should not be penalised more than once for the same conduct. The penalties imposed by the Court should be an appropriate response to what the respondent did[3] (this task is distinct from and in addition to the final application of the “totality principle”).[4]
d)Consider the appropriate penalty for the single breaches and, if relevant, each group of contraventions, taking into account all of the relevant circumstances.
e)Finally, consider whether the penalty is an appropriate response to the conduct which led to the breaches.[5] The Court should apply an “instinctive synthesis” in making this assessment.[6] This is known as an application of the “totality principle”.
[1] Gibbs v Mayor, Councillors and Citizens of City of Altona (1992) 37 FCR 216 at 223; McIver v Healey [2008] FCA 425 at [16] (unreported, Federal Court of Australia, 7 April 2008, Marshall J).
[2] Subsection 557(1) of the FW Act.
[3] Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8 at [46] (Graham J) (unreported, Full Court of the Federal Court of Australia, 20 February 2008, Gray, Graham and Buchanan JJ) (Merringtons).
[4]Mornington Inn Pty Ltd v Jordan [2008] FCAFC 70 at [41]-[46] (Stone and Buchanan JJ) (unreported, Full Court of the Federal Court of Australia, 7 May 2008, Gyles, Stone and Buchanan JJ) (Mornington Inn).
[5] See Kelly v Fitzpatrick (2007) 166 IR 14 at [30] (Tracey J) (Kelly); Merringtons, supra at [23] (Gray J), [71] (Graham J) and [102] (Buchanan J).
[6] Merringtons, supra at [27] (Gray J) and [55] and [78] (Graham J).
Identified contraventions
There are five admitted contraventions, for which penalties are sought to be imposed in respect of three categories:
a)failure to pay the Employees the national minimum wage in contravention of section 293 of the FW Act;
b)failure to make, and keep for seven years, employee records in contravention of subsection 535(1) of the FW Act; and
c)failure to comply with a notice to produce records or documents in contravention of subsection 712(3) of the FW Act.
Grouping of Contraventions – Course of conduct and common elements
Course of Conduct
Multiple breaches of particular provisions may, depending upon the particular circumstances, attract the operation of the course of conduct provisions contained in section 557 of the FW Act.
A relevant factor is whether the breaches arose out of separate acts or decisions of the employer, or out of a single act or decision. The latter case will constitute a course of conduct but the former will not.[7] The onus of establishing the benefit of section 557 of the FW Act is on the Respondent.[8]
[7] Seymour v Stawell Timber Industries Pty Ltd (1985) 9 FCR 241 at 266-267 per Gray J (with whom Northrop J agreed at 245).
[8] Workplace Ombudsman v Securit-E Holdings Pty Ltd (In Liquidation) & Ors [2009] FMCA 700 at [5].
The Applicant accepts that the First Respondent has the benefit of section 557 of the FW Act in relation to repeated breaches of each section of the FW Act regarding each of the Employees affected by that breach. Where a contravention relates to multiple Employees, section 557 applies so that the conduct is taken to constitute a single contravention.
No further grouping should apply to these contraventions. Following the application of the statutory course of conduct provision in section 557 of the Act, each of the three separate civil penalty contraventions as set out at [78] should be treated as a separate contravention attracting an appropriate penalty.
Maximum Penalties
Sections 539(2) and 546(2)(a) of the FW Act prescribe the maximum penalties that may be imposed by this Court for contraventions of civil penalty provisions, by reference to “penalty units” within the meaning of section 4AA of the Crimes Act 1914 (Cth) (Crimes Act).[9]
[9] Section 539(2) of the FW Act prescribes the maximum penalty that may be imposed by this Court for a contravention of each of the civil penalty provisions specified in the table in that section. Section 546(2) of the FW Act prescribes that a pecuniary penalty imposed by this Court must not be more than 5 times the amount referred to in section 539(2) in respect of a body corporate. Section 12 of the FW Act provides that “penalty unit” has the same meaning as section 4AA of the Crimes Act.
At the time of the contraventions, the amount of a penalty unit in section 4AA of the Crimes Act was $170.
The identification of maximum penalties is appropriate as part of the comparative exercise of assessing where the contraventions sit. The maximum penalties “taken and balanced with all of the other relevant factors [do provide] a yardstick.”[10]
[10] Markarian v R (2005) 228 CLR 357 at [31] per Gleeson CJ, Gummow, Hayne and Callinan JJ.
Based on the three civil penalty contraventions identified above, the total maximum penalty that could be imposed on No Land Tax is $127,500 (being ($51,000 x 2) + ($25,500 x 1)). The total maximum penalty that could be imposed on the Second Respondent is $25,500 (being ($10,200 x 2) + ($5,100 x 1)).
Factors relevant to Penalty and Totality
Factors relevant to the imposition of a penalty under the FW Act include:[11]
[11] See Kelly at [14], adopting Mason v Harrington Corporation Pty Ltd t/as Pangaea Restaurant & Bar [2007] FMCA 7 (Pangaea), [26]-[59]; Stuart-Mahoney v CFMEU [2008] FCA 1426 at [40].
a)the nature and extent of the conduct which led to the breaches;
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 breaches;
d)whether there had been similar previous conduct by the respondent;
e)whether the breaches 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 breaches were deliberate;
h)whether senior management was involved in the breaches;
i)whether the party committing the breach had exhibited contrition;
j)whether the party committing the breach had taken corrective action;
k)whether the party committing the breach had 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.
While a convenient summary, these factors do not prescribe or restrict the matters which may be taken into account in the exercise of the Court’s discretion.[12]
[12] Sharpe v Dogma Enterprises Pty Ltd [2007] FCA 1550 at [11]; Merringtons at [91] per Buchanan J.
The nature and extent of the conduct
The total non-payment of national minimum wage order entitlements in respect of the Employees was $4,006.66.[13] (The total non-payment of safety net contractual entitlements in respect of the Employees was $6,219.90.[14]) The first respondent failed to keep employee records in relation to the Employees recording the information required by regulations 3.32(c) and (d) and 3.33(2) of the Fair Work Regulations 2009 and failed to produce various categories of documents sought under the NTP (as defined in paragraph [52] of the SOAF) at all.[15]
[13] SOAF Annexure A (page 16)
[14] Ibid
[15] SOAF at [55].
As to the nature of the identified contraventions, the minimum standards governing the required frequency of payment obligation are mandated to ensure that employees have sufficient funds to cover the basic costs of living. The Applicant submits, and the Court agrees, that the nature of the First Respondent’s conduct in depriving the Employees of payment is thus serious.
The Respondents contend that they had a legitimate expectation of winning one or more seats in the NSW Election on 28 March 2015 and thus, on achieving this result, would have had funding to pay the workers for the day. The fact that this did not occur is described by the Respondents as “a grave miscalculation”. The relevance of this, if any, is discussed below.
Although the period for which they were not paid is only one day, none of the Employees were paid until after the commencement of these proceedings,[16] and (prior to that) they received no payment at all for the work they undertook for the First Respondent.
[16] See SOAF at [9]; [C] Affidavit at [37];
Whilst the Respondents concede this, they submit that the workers were not employed as casuals, but rather to perform a specific task on one Saturday of their lives. On the Respondent’s behalf it was contended that “it cannot seriously be accepted by the Court, that not being paid approximately $300 for the day, has had a material impact on their lives, wellbeing on finances”. Whether the unpaid workers were casuals or otherwise is irrelevant in the present context. What is relevant is that they were unpaid. In any event, the submission made on behalf of the Respondents is both inconsistent with the evidence before the Court from the workers themselves, and regrettably arrogant.
The maintenance of the required employment records, and production of those pursuant to notices to produce issued by the Applicant is integral to the functioning of the Applicant as a regulator.
The Respondents contend this breach is technical rather than one of substance. The Court does not agree. Barker J in Fair Work Ombudsman v Han Investments [2017] FCA 623 said at [13]-[15]:
113. This is an area of employment regulation where, unless record keeping obligations are met, the ability of a regulator, and indeed individual employees, to identify an employer’s breach of employment obligations is made difficult, if not on occasions impossible – as indeed this case emphasises.
114. The record keeping obligations are directed at ensuring the creation and retention of records as a critical tool in the assessment of compliance with workplace laws. Unless an employer complies with the law, and makes and keeps employment records, an effective safety net for employees is difficult to maintain. The result is that employees are more vulnerable to exploitation. The job of the FW Ombudsman, as regulator, in detecting and protecting employees’ workplace entitlements is reduced in effectiveness.
115. I therefore accept the submission made on behalf of the FW Ombudsman that the contraventions in this case should not be seen as mere contraventions of some lower order. The failure to maintain records truly strikes at the very foundation of the regulatory scheme which is designed to ensure that employees are paid their legal entitlements.
Circumstances in which the conduct took place
One material circumstance in which the conduct took place is that, on the respondents’ evidence, the Employees were engaged by the first respondent with the expectation that they would be paid and having been told that they would be,[17] in circumstances where the funding available to pay the Employees was contingent on the outcome of the election.
[17] As to which, see paragraph 98 below.
In the Second Respondent’s affidavit sworn on 18 August 2017 (Jones Affidavit) at [21(c)], the Second Respondent stated that the source of the funding to pay the Employees for their work on the election day on 28 March 2015 was the “public funding NLTC would thus be entitled to”. On the Second Respondent’s evidence, this funding was available only if an NLTC candidate was elected to the New South Wales Parliament.[18] The First Respondent therefore engaged the Employees knowing that it may not have funds available to pay them as a volunteer-based, not-for-profit association reliant upon the goodwill of members for its day-to-day operations.[19] The Applicant contents, and the Court accepts that the Respondents could not have assumed the public funding was a certainty, based as it was on the vagaries of the success of a minor political party in an election.
[18] Jones Affidavit at [17] – [18].
[19] Jones Affidavit at [12].
Many of the Employees were told, in a leaflet advertising the available work that they would be paid $30 an hour for their work.[20] They were told in an email on 28 March 2015 at the conclusion of their day’s work: “We are aware that you may have been subjected to harassment today – specifically from people telling you that you will not be paid for your work. This is a complete lie. You will be paid – and promptly”.[21]Nothing could have been further from the truth.
[20] [C] Affidavit at [6], [S] Affidavit at [3], [N] Affidavit at [4], [B] Affidavit at [4], [R] Affidavit at [3], [H] Affidavit at [4], Mr [L] Affidavit at [3], [J] Affidavit at [4], [T] Affidavit at [3], [L] Affidavit at [3], [E] Affidavit at [3], [A] Affidavit at [5], [K] Affidavit at [4], [Q] Affidavit at [4] and [F] Affidavit at [4]
[21] [C] Affidavit at [26], [O] Affidavit at [21], [N] Affidavit at [18], [B] Affidavit at [20], [R] Affidavit at [12], [I] Affidavit at [14], [H] Affidavit at [14], [T] Affidavit at [12], [E] Affidavit at [21], [A] Affidavit at [23], [K] Affidavit at [15], [Q] Affidavit at [23] and [F] Affidavit at [17]
As events transpired, the First Respondent did not receive the funding it relied on to pay the Employees because none of its candidates were elected.[22]
[22] Jones Affidavit at [49].
The Jones Affidavit at [53] refers to the financial position of the Respondent as follows:
“Since the 2015 Election, NLTC has essentially been dormant. It does not operate any longer and has no funds. It owes substantial debts to key party members, including myself.”
There is no evidence of the quantum of NLTC’s bank accounts or other documents to substantiate NLTC’s financial position. In any event, financial difficulty provides no justification for an employer to fail to comply with its statutory obligations: Fair Work Ombudsman v South Jin Pty Ltd (No 2)[2016] FCA 832 at [50] per White J.
In Lynch v Buckley Sawmills Pty Ltd,[23] Keely J stated in the context of breaches of an industrial award:
“…it is important that the respondent – and other employers bound by the award or by other awards under the Act – understand the importance of complying with an award and it follows that any decision taken by them which is regarded as affecting their obligations to comply with particular provisions of the award or the award generally should only be taken after careful consideration. They must not be left under the impression that in times of financial difficulty they can breach an award made under the Act either with impunity or in the belief that no substantial penalty will be imposed in respect of a breach found by a court to have been committed.”
[23] (1984) 3 FCR 503 at 508.
Burchardt FM stated in Fair Work Ombudsman v Promoting U Pty Ltd & Anor[2012] FMCA 58 at [49]:
“I think it is also important to bring home to any other employers who are experiencing the sort of cash-flow problems described by the Respondents that they nonetheless do not evade their responsibilities merely because of that circumstance. It is not properly open to an employer simply to avoid or evade their obligations under the Workplace Relations law simply because they are struggling.”
It is important to explain in these reasons the perspective of the Respondents as to the circumstances of the non-payment of their workers. On their behalf, it was contended that their conduct represented “a grave miscalculation that arose from blind optimism” such that the Respondents neither fully considered their prospects of success at the election, nor the timing of the payments to the workers. The emails to the workers referred to above contain a representation which is now conceded to be incorrect, but which was part and parcel of that grave miscalculation.
The Second Respondent, in his affidavit of 9 October 2017, deposed to his expectation of when funding would have been paid if the Respondents had succeeded at the election. He contends that payment would have been within 14 days of a claim being made. Quite apart from the obvious fact that, even if this were so, the workers would not have been paid when required by law, there are other obvious difficulties in accepting the contention. The Second Respondent’s own evidence about funding entitlements is problematic. The Election Campaign Fund Fact Sheet – 2015 NSW State Election, issued by the Electoral Commission of NSW, annexed to his affidavit, indicates:
The claim for payment is not valid unless:
(d) The expenditure included on the claims is vouched for in the correct manner. That is, all expenditure included in the claim is to be accompanied by the account or the receipt issued to the party or candidate in respect of the expenditure.
Where there is expenditure included in the claim for which no account or receipt has been attached, the claim is deemed invalidly lodged and no payments will made in respect of the claim”.
The evidence before the Court is quite clear: the workers were not paid, so there was no expenditure, and there were no accounts or receipts for any payments made. Moreover, there were no records kept for the purpose of s535(1) so it would have been impossible to make any claim.
There can be no basis for any reasonable apprehension of payment in the circumstances of the case.
The nature and extent of loss or damage sustained
The Court finds that the extent of the loss suffered by the Employees was substantial from their perspectives. While the total underpayment figure is not large, it represented 100% of the Employees’ entitlements as they were engaged for a single day and subsequently not paid for that day at all until 16 May 2017 in the case of 19 of the 21 Employees.[24] By this stage, the Employees had been without the benefit of their wages for over two years. The Court accepts that the remaining two of the Employees have now been paid. The extent of this loss was significant to many of the Employees who were motivated to seek employment with the First Respondent solely for the purpose of the money they would receive to be used for specific purposes.
[24] Payment Detail Report dated 16 May 2017, SOAF at [6].
The relevant circumstances of the Employees include those set out below:
a)[O] was a full-time student who also worked 15 to 20 hours per week as a bartender where he was paid $12 per hour.[25] The opportunity to earn $30 per hour appealed to him,[26] he was left out of pocket and felt conned due to the non- payment;[27]
[25] [O] Affidavit at [3].
[26] Id at [5].
[27] Id at [32].
b)[N] was working full-time as a receptionist,[28] in addition to this she worked from 7 am to 6 pm on Election Day[29] and had planned to use the money for a weekend away with her husband that she had booked;[30]
[28] [N] Affidavit at [3].
[29] Id at [11] and [17].
[30] Id at [36].
c)[B] was working full-time as an administrative assistant, she was in a difficult financial situation and was relying on the money that she was told she would be paid;
d)[H] had recently graduated and was unemployed at the time he worked on Election Day, working on Election Day was intended to provide him with spending money for the next few weeks and he was very disappointed not to be paid for the work he did;[31]
e)[J] was a university student studying architecture[32] and had expenses for model making materials.[33] He had cancelled working at his father’s warehouse to work for the First Respondent on Election Day;[34]
f)[T] was unemployed at the time[35] and worked a long day in the sun from 7:30 am to 6 pm because she wanted to be paid;[36]
g)[E] was a student, working part-time and not earning a lot of money. She chose to work on Election Day to earn extra money to pay her rent, she found the experience horrible and lost trust in people at face value;[37]
h)[A] was unemployed at the time, living in a rural area with limited work available and looking to re-enter the workforce. The experience with the First Respondent damaged her confidence, made her feel like she had been conned and set-back her job search;[38]
i)[U] was working as an administration and accounts clerk,[39] her experience left her feeling taken advantage of and like she can no longer trust people at face value;[40]
j)[K] was a year 10 student[41] and was hoping to use his pay to purchase his first drone to participate in competitions. It was his first job and he was really disappointed not to get paid;[42]
k)[Q] was a year 12 student.[43] She was very upset not to have been paid as $300 was a lot of money to her as a 17 year old;[44] and
l)[F] was working full-time as a receptionist and was counting on using her pay from the First Respondent for household bills.[45] As a result of not being paid she lost trust in elections and politicians.[46]
[31] [H] Affidavit at [23].
[32] [J] Affidavit at [3].
[33] Id at [27].
[34] Id at [28].
[35] [T] Affidavit at [3].
[36] Id at [9] and [23].
[37] [E] Affidavit at [37] and [38].
[38] [A] Affidavit at [37].
[39] [U] Affidavit at [3].
[40] Id at [34].
[41] [K] Affidavit at [3].
[42] Id at [24] and [25].
[43] Affidavit of [Q] at [5].
[44] Id at [33].
[45] [F] Affidavit at [3] and [32].
[46] Id at [33].
Thus, the Court finds that the loss and damage the Employees suffered as a result of the contraventions was material given their subjective circumstances.
Similar previous conduct
There is no evidence that the First Respondent has previously engaged in contraventions of workplace laws.
Size of the business enterprise involved
On 28 March 2015, the First Respondent had around 3,600 employees engaged for that day only.[47] It was clearly not a large institutional employer in the sense that this workforce was not permanent, but it did employ a significant number of employees for that day. Although this proceeding relates only to the underpayment of the 21 Employees, the evidence does not suggest that these employees were the only ones who were not paid for their work on that day. The Respondents did not dispute the non-payment of the other workers.
[47] Spiliotopoulos Affidavit at [9].
Courts have previously found that sanctions should be imposed at a meaningful level regardless of the employer’s size or financial position. In Kelly,[48] Tracey J stated:
“No less than large corporate employers, small businesses have an obligation to meet minimum employment standards and their employees, rightly, have an expectation that this will occur. When it does not it will, normally, be necessary to mark the failure by imposing an appropriate monetary sanction. Such a sanction “must be imposed at a meaningful level”: see Australian Competition and Consumer Commission v ABB Transmission and Distribution Ltd [2001] ATPR 41-815 at [13].”
[48] [2007] FCA 1080 at [28].
In Fair Work Ombudsman v Bosen Pty Ltd[49] the Court stated at [51]:
“There is a need to send a message to the community at large, and small employers particularly, that the correct entitlements for employees must be paid and that steps must be taken by employers (of all sizes) to ascertain and comply with minimum entitlements (as opposed to ignoring those obligations). Compliance should not be seen as the bastion of the large employer, with human resources staff and advisory consultants (accountants, consultants, lawyers) behind them.”
Even though the First Respondent is not a large institutional employer, this Court will mark its disapproval of the conduct in question and set a penalty which serves as a warning to others.[50]
[50] Kelly at [28].
Deliberateness of the breaches
The First Respondent as the employer was responsible for ensuring that entitlements were paid to the Employees in a timely manner.[51] The Applicant concedes that it may not have been the First Respondent’s original intention to fail to pay the Employees, but in circumstances where it engaged around 3,600 Employees not knowing whether or not it would be in a position to pay them until after their work was performed, depending on the outcome of the election, that was the inevitable consequence of its deliberate actions. Relevant to this assessment is the Respondents’ actions in what the Court accepts was misrepresenting that payment would be forthcoming in circumstances where the First Respondent knew that it did not have funds readily available to pay the Employees, unless and until public funding became available, depending on the outcome of the election for which the Employees were engaged, and subject to the acceptance of a claim.
[51] SOAF at [12].
Examples of instances disclosed in the evidence in which the Respondents assured the Employees that that they would be paid include the following:
a)on 28 March 2015 the Second Respondent emailed many of the Employees and said “We are aware that you may have being subjected to harassment today – specifically from people telling you that you will not be paid for your work. This is a complete lie. You will be paid – and promptly”;[52]
b)on 31 March 2015 the Second Respondent emailed many of the Employees and said “We expect to make the first payment on Tuesday 7 April 2015 (the first day after Easter). We expect to have completed ALL payments NO LATER than 30 April 2015”;[53]
c)on 11 April 2015 the Second Respondent emailed many of the Employees and said “We are legally obliged to pay you NO LATER than Tuesday 28 April 2015. Although we are working to pay everyone sooner than that. We will keep you updated on progress by email”;[54] and
d)on 16 April 2015 the second respondent emailed many of the Employees and said “Based on current information we expect to have your payslip to you on Monday (20 April 2015) and your pay to you before Friday 24 April 2015.”[55]
[52] [C] Affidavit at [6], [S] Affidavit at [3], [N] Affidavit at [4], [B] Affidavit at [4], [R] Affidavit at [3], [H] Affidavit at [4], [L] Affidavit at [3], [J] Affidavit at [4], [T] Affidavit at [3], [L] Affidavit at [3], [E] Affidavit at [3], [A] Affidavit at [5], [K] Affidavit at [4], [Q] Affidavit at [4] and [F] Affidavit at [4]
[53] [C] Affidavit at [27], [O] Affidavit at [22], [N] Affidavit at [21], [B] Affidavit at [24], [R] Affidavit at [13], [I] Affidavit at [16], [J] Affidavit at [16], [T] Affidavit at [13], [E] Affidavit at [22], [A] Affidavit at [25], [K] Affidavit at [16] and [Q] Affidavit at [24].
[54] [O] Affidavit at [24], [N] Affidavit at [26], [B] Affidavit at [26], [R] Affidavit at [15], [H] Affidavit at [17], [I] Affidavit at [18], [J] Affidavit at [19], [T] Affidavit at [16], [E] Affidavit at [25], [A] Affidavit at [28], [K] Affidavit at [18], [Q] Affidavit at [26] and [F] Affidavit at [19]
[55] [O] Affidavit at [26], [N] Affidavit at [26], [B] Affidavit at [27], [R] Affidavit at [16], [I] Affidavit at [19], [H] Affidavit at [18], [J] Affidavit at [20], [T] Affidavit at [17], [E] Affidavit at [27], [A] Affidavit at [30], [K] Affidavit at [19], [Q] Affidavit at [27] and [F] Affidavit at [21]
Given that the outcome of the election must have been known to the Respondents after 28 March 2015, the Respondents must have known that they would not be able to rely upon government funding as the source of funds to pay the Employees. The Jones Affidavit does not disclose any alternative funding source, and so the basis for the respondents’ assurances on 31 March 2015 and 16 April 2015 that the Employees would be paid, in the absence of any available funds to do so after 28 March 2015, has not been disclosed. The non-payment of the Employees was not due to an administrative error, and the Respondents were aware at all times that the Employees had not been paid, and that they were obliged to pay the Employees within one month after the performance of work.[56] In the circumstances, the Court finds that these assurances were sent in an attempt to delay the Employees while alternative funding was found. This is relevant to the Court’s assessment of the deliberateness of the contraventions.
[56] As demonstrated by the second respondent’s email dated 11 April 2015, referred to above.
If an employer expects an employee to attend for work, then it must also expect to pay that employee. The Applicant contends that the First Respondent ought to be found to have acted deliberately in regard to non-payment of the employees. The Respondents disagree.
The Respondents contended that there was no conscious and deliberate decision made not to pay the unpaid workers i.e. there was no mens rea. Whilst conceding that they committed “a grave miscalculation that arose from blind optimism”, it was submitted on their behalf that, similar to National Tertiary Education Industry Union v Swinburne University of Technology [2013[ FCA 1128, the contraventions arose through inadvertence. The Court rejects this contention. Even if the Court accepted that the Respondent’s actions were, in fact, “a grave miscalculation that arose from blind optimism”, it would not accept that this constitutes inadvertence. Inadvertence connotes inattention or oversight. It might conceivably apply for example, to non-payment of one worker, perhaps two, but could not possibly apply to 21 workers or 3600 unpaid workers.
The submissions on behalf of the Respondents that there was no mens rea is worth considering in light of the comments made by Barwick CJ in Iannella v French [1968] HCA 14 at [24]:
It is thus appropriate to consider the meaning and application of the word "wilful" in the specification of an offence. The Chief Justice of South Australia, having examined the case law, has repeated the view that the cases show that the word "wilful" is not a word of fixed meaning. But of this I cannot myself feel absolutely certain. I am inclined to think that in the description of a criminal offence its connotation is fairly constant: but that its denotation varies with the verbal context and the subject matter of the statutory provision. In my opinion, "wilful" connotes intention and knowledge: the problem is to determine in the particular circumstances what is to be intended and what known. The answer, as I have said, must vary with the nature of the act proscribed and the context of the statutory provision creating the offence. Further, the word intention itself obscures a difficulty. Thus it is said on some occasions to be satisfied by mere volition to do the specific act in question. But in truth, in my opinion, the word contains in its connotation elements of purpose. It is not merely that the mind goes with the act but that the mind intends by the act to achieve something. Of course, in some statutory circumstances, the mere doing without consequence or without purpose is forbidden, in which event the conscious doing of the act may suffice to make its performance intentional and in these circumstances wilful.
Section 323 of the FWA creates an obligation on an employer to pay an employee “… must pay an employee…”. The Respondents case is that there was no conscious and deliberate decision made not to pay and thus to the extent that the obligation to pay is dependent on a mens rea, this was absent. The fallacy in this argument is revealed in the passage from Iannella v French above. Where the FWA creates an obligation of payment, to focus on intention per se can distract from the real issue i.e. the “elements of purpose” to which Barwick CJ refers. Thus intention is established not just by reference to the final element of a purpose, but by all the elements that precede it. Whether there is an intention not to pay must be determined not just at the point of that final element of physical (or electronic) payment, but rather by the other elements of payment including whether, in this case, it was even reasonable for the Respondents to believe at the point of recruitment of the workers that there would be funds to pay them. Intention is thus inferred or deduced by reference to all the mental and physical elements of the act or omission in question, including the relationship of employer and employee that gives rise to the obligation to pay. If mens rea is requisite, it was present in this case.
The difficulty for the Respondents is that there is no evidence that satisfies the Court that they had a legitimate and considered expectation of winning one or more seats in the NSW Election on 28 May 2015. Moreover, even if they had won, on their own evidence (or lack thereof) they could not have reasonably satisfied the requirements for payment from the Election Campaign Fund due to lack of records.
The Respondent’s reliance on National Tertiary Education Industry Union v Swinburne University of Technology is misconceived. There is no comparison between the actions complained of in each case. The conduct in the present case is more severe. The Respondents conduct in National Tertiary Education Industry Union v Swinburne University of Technology was inadvertent but it was clearly not inadvertant in the present case. Moreover, there was no agreed penalty range in this case, as there was in National Tertiary Education Industry Union v Swinburne University of Technology.
The Applicant, quite correctly, accepts there is no evidence of a deliberate intention by the Respondents not to pay. If the focus is on the single act of non-payment, the Court accepts there was no intention not to pay.
Involvement of Senior Management
The Second Respondent was clearly a senior manager of the First Respondent and the person responsible for most of the administrative workload of the First Respondent, being its Secretary.[57]
[57] Jones Affidavit at [15].
Corrective Action and Contrition
The concept of contrition, as a mitigating factor in the imposition of penalty on sentencing, is a concept derived from the criminal law. In ACE Insurance Limited v Trifunovski (No.2) [2012] FCA 793 Perram J said as follows at [113]-[114]:
“It is not clear to me how an artificial construct such as a corporation can experience the complex human emotion of contrition made up, as it is, of an amalgam of distinctly human emotions such as regret, shame and sympathy. I do not doubt that a corporation may exhibit signs of regret but it is too much to expect that such an artificial construct can be meaningfully contrite.
For civil penalty cases involving corporations it would be more coherent to ask only whether the corporation has changed its behaviour. Nothing more can be expected; a person who does not literally or physically exist may not wear sackcloth.”
Almost immediately afterwards, a different view was taken by Katzmann J in CFME Union v Pilbara (No 4) [2012] FCA 894 where her Honour stated:[58]
[34] “While I naturally accept the force of Perram J’s remarks, I do not agree that nothing more can be expected of a corporation than that it has changed its behaviour. A corporation may admit its wrongdoing and spare the other parties the costs of prosecuting the case. In a jurisdiction, such as this, where costs can only be awarded in exceptional cases that is a meaningful expression of contrition. The corporation may also offer recompense. It may apologise. The decision-makers themselves could offer apologies. It may introduce precautions to guard against the risk of reoffending. In the present case …”
[35] “… the respondent did nothing. Moreover, it sought to shift all responsibility away from itself to the employee it wronged.” [emphasis added]
[58] See also Commissioner of Taxation v Arnold (No 2) [2015] FCA 34 at [196].
The Respondents by their admissions have spared the applicant from the costs of the liability aspect of the case. However, they did so late in the history of the proceeding, including after the matter had been set down for hearing and extensive evidence on liability filed by the Applicant. The Applicant submits, therefore, that although the Respondents are entitled to some discount on penalty for the ultimate admission as to liability, it ought not be as great a discount as they would have received had the admission come at the commencement of the proceeding. The Court agrees.
While the Jones Affidavit states that the First Respondent has been dormant since the March 2015 election and does not operate any longer, it is still registered as an incorporated association. There is no evidence of corrective action taken by the First Respondent in the event that the First Respondent employs a workforce in the future.
Failure to cooperate with authorities
The Respondents failed to cooperate with the Applicant through its investigation. The Second Respondent’s statement that he “endeavoured to co-operate and provide copies of documents to the best of my ability”[59] is not supported by:
a)the SOAF at [6] where the first respondent admits to failing to comply with a notice to produce records or documents and [7] where the second respondent admits to his involvement in each of the first respondent’s contraventions;
b)the SOAF at [55] where the first respondent admits that documents in respect of 3 paragraphs of the notice to produce records or documents were not provided; and
c)evidence of FWI Spiliotopoulos concerning the applicant’s multiple attempts to contact the first respondent in respect of non-compliance with the notice to produce records or documents, in particular the email from FWI Dougall to the second respondent dated 5 May 2015 encouraging the second respondent to continue to collate relevant documents to produce to the FWO.[60]
Compliance with minimum standards by provision of an effective means for investigation and enforcement of employee entitlements
[59] Ibid at [59]
[60] Affidavit of Steven Spiliotopoulos sworn 19 August 2016 at [28]
One of the principal objects of the FW Act is the maintenance of a safety net of minimum terms and conditions of employment and effective enforcement of the obligations imposed by awards and other industrial instruments: see Kelly at [27].
Ignoring the basic entitlements of employees is an aggravating factor relevant to penalty.[61] Those employers who fail to comply with minimum obligations gain an unfair competitive advantage over those employers who do comply with their workplace obligations.[62] Furthermore, compliance with notices to produce and maintenance of employment records are vital to the effective functioning of the applicant as a regulator. Without accurate records being kept, and produced when required to do so, the capacity of the regulator to identify contraventions and calculate underpayments is severely hindered. These obligations play a central role in the capacity of the regulator to monitor and enforce compliance with minimum employment standards. As noted by this Court in Fair Work Ombudsman v Zillion Zenith International Pty Ltd & Anor:[63]
“One of the principal objects of the FW Act is the maintenance of an effective safety net of employer obligations, and effective enforcement mechanisms. The failure to keep records by the respondents which is admitted arguably undermines and frustrates the attainment of that object. There is also the issue that the failure to keep the records themselves and the vice that conduct gives rise to. As was identified in Fair Work Ombudsman v Taj Palace Tandoori Indian Restaurant Pty Ltd & Anor [2012] FMCA 258 and Fair Work Ombudsman v Orwill Pty Ltd & Anor [2011] FMCA 730 the problem where employers don’t keep proper records is that it creates a structure ‘within which breaches of the industrial laws can easily be perpetrated’.”
[61] Fair Work Ombudsman v Liquid Fuel Pty Ltd & Ors (No.2) [2015] FCCA 3139 [56].
[62] Fair Work Ombudsman v AIMG BQ Pty Ltd ACN 148 012 284 & Anor [2016] FCCA 1024 at [118].
[63] [2014] FCCA 433 at [76].
In cases where breaches are found to exist, if the statutory obligations of agencies like the applicant are not capable of achieving a remedy of enforcement, it is likely that community standards of compliance will drop. This is clearly not the intention of the Parliament, who has from time to time increased penalties.[64]
[64] Fair Work Ombudsman v Ajsj Pty Ltd & Anor [2016] FCCA 1902.
Indeed, the penalties set by the legislature for contraventions of the FW Act themselves reinforce the importance placed on compliance with minimum standards.
The Court has regard to the Federal Court decision of Fair Work Ombudsman v A Dalley Holdings Pty Ltd:[65]
“In imposing a penalty, it is imperative for the Court to impose a penalty that reinforces the fundamental importance of compliance with the safety net of entitlements specified by the National Employment Standards and the general protection provisions of the FW Act.”
[65] [2013] FCA 509 at [19].
The Applicant submits, therefore that, the penalty to be imposed on the First Respondent must reflect an effective means of enforcement. The Respondents submit that the breach of the record keeping obligations were technical rather than of substance. The Court does not agree, as is reflected in the reasons stated above.
Specific and General Deterrence
The High Court decision of Commonwealth of Australia v Director, Fair Work Building Industry Inspectorate (2015) 326 ALR 476; [2015] HCA 46 (per French CJ, Kiefel, Bell, Nettle & Gordon JJ), (Commonwealth v FWBII) at [55] is apt with regard to notions of deterrence (references omitted): [66]
No less importantly, whereas criminal penalties import notions of retribution and rehabilitation, the purpose of a civil penalty, as French J explained in Trade Practices Commission v CSR Ltd, is primarily if not wholly protective in promoting the public interest in compliance:
"Punishment for breaches of the criminal law traditionally involves three elements: deterrence, both general and individual, retribution and rehabilitation. Neither retribution nor rehabilitation, within the sense of the Old and New Testament moralities that imbue much of our criminal law, have any part to play in economic regulation of the kind contemplated by Pt IV [of the Trade Practices Act]. ... The principal, and I think probably the only, object of the penalties imposed by s 76 is to attempt to put a price on contravention that is sufficiently high to deter repetition by the contravenor and by others who might be tempted to contravene the Act."
[66] See also: Pangaea at [26] – [59].
The need for general deterrence is a key factor warranting the imposition of penalties in this proceeding, where the contravening conduct was deliberate (even if the Court accepts that the failure to pay was not deliberate). The Applicant submits, therefore, that the Court should mark its disapproval of the first respondent’s conduct by setting a penalty that serves as a warning to others.[67]
[67] Kelly v Fitzpatrick [2007] FCA 1080 (2007) 166 IR 14 at [25].
In Fair Work Ombudsman v Maclean Bay Pty Ltd (No 2) [2012] FCA 557 at [29], Marshall J observed:
“It is important to ensure that the protections provided by the [FW Act] to employees are real and effective and properly enforced. The need for general deterrence cannot be understated. Rights are a mere shell unless they are respected.”
The Respondents have led evidence of their respective financial positions, including that the First Respondent “has no funds”[68] and that the Second Respondent “is in very difficult financial circumstances” and has “virtually no capacity to pay any penalty resulting from these proceedings”.[69] In this regard, the judgment of Edmonds J in Commissioner of Taxation v Arnold (No 2) [2015] FCA 34 states at [201] & [204]:
“[201] The proper balance between achieving general deterrence and a consideration of financial circumstances was explained in Australian Competition and Consumer Commission v High Adventure Pty Ltd [2005] FCAFC 247; [2006] ATPR 42-091 where the Full Court relevantly stated (at [11]):
[A]s deterrence (especially general deterrence) is the primary purpose lying behind the penalty regime, there inevitably will be cases where the penalty that must be imposed ... may be so high that the offender will become insolvent. That possibility must not prevent the Court from doing its duty for otherwise the important object of general deterrence will be undermined.
[204] The need for general deterrence must, of course, be balanced by an insistence that the penalty not be “so high as to be oppressive”: see Trade Practices Commission v Stohl Chain Saws (Aust) Pty Ltd [1978] ATPR 17,882 at 17,896; NW Frozen Foods per Burchett and Kiefel JJ at 293. However, this principle requires only that the penalty be no higher than what is required to achieve general deterrence. It does not require that the proper amount necessary to achieve general deterrence be mitigated by reference to notions of financial hardship. The result is that “a penalty that is no greater than is necessary to achieve the object of general deterrence, will not be oppressive: see Leahy Petroleum at [9].”[70]
[68] Affidavit of Peter Jones sworn 18 August 2017 at [53]
[69] Ibid at [74] and [78]
[70] Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd (No 2)& Ors [2005] FCA 254; (2005) 215 ALR 281
The Respondents submit that, whilst general deterrence may require that a penalty be fixed at a level which is sufficient to mark the Court’s disapproval of the offending conduct, it is met in this case by the imposition of findings of contraventions against both Respondents. The Respondents expect future adverse media coverage. Whether or not the Respondents receive adverse media coverage, the Court does not accept that merely finding against the Respondents is sufficient general deterrence. Such a finding would not, in this Court’s view, “put a price on a contravention that is sufficiently high to deter repetition by the contravener and by others who might be tempted to contravene the Act” (French J, Trade Practices Commission v CSR Limited [1990] FCA 521 at 40). Political parties and aspiring politicians need to be aware of the consequences on them of non-compliance with laws which protect the rights of workers.
The Applicant submits, and the Court agrees, that specific deterrence is also of some relevance in this proceeding. The First Respondent continues to be incorporated (although it is presently dormant). There is a possibility of it employing workers in the future. The penalties must be sufficient to deter the first and second respondents from engaging in further unlawful conduct of this type.
In Plancor Pty Ltd v Liquor Hospitality and Miscellaneous Union,[71] Gray J observed:
“Specific deterrence focuses on the party on whom the penalty is to be imposed and the likelihood of that party being involved in a similar breach in the future. Much will depend on the attitude expressed by that party as to things like remorse and steps taken to ensure that no future breach will occur.”
[71] (2008) 171 FCR 357 at [37]
There has been limited demonstration of contrition or remorse[72] in the circumstances of this case which is a relevant consideration in considering specific deterrence. The applicant acknowledges that the second respondent has apologised “that it has taken so long for the 21 Employees to be paid” and also admitted that “I wrongly concentrated on the interests of NLTC and of me to the detriment of the Employees.”[73]
[72] Workplace Ombudsman v Saya Cleaning Pty Ltd & Anor [2009] FMCA 38 at [41] and the cases there-cited.
[73] Affidavit of Peter Jones sworn 18 August 2017 at [66]
In the present case, while there has been an apology, the Respondents do not appear to take full responsibility for their contraventions. The Respondents maintain that:
a)“there was a sound and reasonable basis for believing the 2015 Election would result in there being sufficient funds to pay the Employees”; and
b)“largely, the result of the 2015 Election for NLCT and for me was the result of what I believe to be improper, and possibly illegal, action by others.”[74]
[74] Ibid at [69]
The Court does not accept the Respondents contentions.
Appropriate Penalty and Totality
The Applicant submits that taking the above into account, with multiple contraventions of civil penalty obligations under the FW Act, the contraventions being objectively of a serious nature, albeit limited to a duration of one day, involving a known and deliberate breach (although, it is accepted, not malicious), the loss of 100% of the Employees’ entitlements over the period they were employed, the number of employees affected, late rectification, a modest discount for admissions, and the need for specific and general deterrence, the applicant seeks between $59,670.00 and $71,145.00 by way of an appropriate aggregate pecuniary penalty against the First Respondent and between $11,934.00 and $14,229.00 by way of an appropriate aggregate pecuniary penalty against the Second Respondent. The Applicant’s calculations in this regard are set out in Schedule 2 of these Reasons. There is inconsistency, however, between this range, and the percentages sought by the Applicant.
Having fixed an appropriate penalty for each course of conduct, the Court should consider the aggregate penalty, to determine whether it is an appropriate response to the conduct which led to the breaches, and is not oppressive or crushing.[75]
[75] Kelly at [30]; Merringtons per Gray J at [23], per Graham J at [71], per Buchanan J at [102]
In Fair Work Ombudsman v Maclean Bay Pty Ltd (No.2) [2012] FCA 557, Marshall J after referring to Markarian v The Queen (2005) 228 CLR 351 noted at [49] the essential question to ask in relation to the application of the totality principle is whether the total penalties are appropriate having regard to the potential maximum.
Whilst the penalty imposed must not be crushing or oppressive, it must nevertheless bear relativity to the conduct engaged in by the first and the second respondents.[76]
[76] Fair Work Ombudsman v Promoting U Pty Ltd & Anor [2012] FMCA 58.
The Applicant submits that the accumulation of the penalties sought, compared with the maximum penalty, results in sum which is between 44% and 53% of the maximum. The Applicant submits that, this strikes an appropriate balance between the seriousness of the conduct and an amount which is not crushing.
The Respondents submit, by contrast, that the penalty range contended for by the Applicant cannot on any sensible view be said to be an appriopriate response to the conduct of the Respondents. Counsel emphasised that the contraventions occurred on one day only, related to 21 workers, and involved a total aggregated underpayment to the workers of $6,219.90
The Court does not accept this submission. It minimizes the significance of the actions and ommissions of the Respondents, as is explained elsewhere in these Reasons. The Court believes that, if anything, the penalty range sought by the Applicant was, having regard to the evidence before the Court, on the conservetative side. For reasons previously explained, the Court does not believe that National Tertiary Education Industry Union v Swinburne University of Technology assists it in assessing the appropriate penalty in this case. Indeed this Court is concerned that anything less than 53% might have the effect of reducing public confidence in the statutory regime established by the FWA.
The Court believes that the penalty should be 53% of the maximum.
The Court records that Counsel for the Second Respondent submitted that his mental health was not an irrelevant factor to the determination of penalty on him personally. The reality of the evidence, however, is that the only evidence about the Second Respondent’s mental health came from him. The Court places no weight on this. No expert evidence on this issue was admitted into evidence.
Declarations
The Court has a wide discretionary power to make declarations.[77] The declarations sought by consent (SOAF at [68]) have being framed to identify the contravening conduct accurately and concisely.[78]
[77] Federal Circuit Court of Australia Act 1999 (Cth) section 16, ACCC v Dataline.net.au Pty Ltd (2006) 236 ALR 665 (Dateline) at [58]; ACCC v Yellow Page Marketing BV (No 2) 2011 FCA 352 (Yellow Page) at [65]
[78] Dateline at [63] and Yellow Page at [69]
The Applicant submits that there will be utility in making the declarations sought. The declarations clearly identify the contravening conduct and there is a public interest to be served in that the declarations sought will help to deter future non-compliance with Safety Net Contractual Entitlements and the National Minimum Wage Order thereby reinforcing the integrity of the Australian workplace relations system.
Making the declarations sought would also mark the Court’s disapproval of the contravening conduct.[79]
[79] Yellow Page at [69]
I certify that the preceding one hundred and fifty nine (159) paragraphs are a true copy of the reasons for judgment of Judge Altobelli
Date: 6 December 2017
Schedule 1
NATIONAL MINIMUM WAGE ORDER AND SAFETY NET CONTRACTUAL ENTITLEMENTS UNDERPAYMENTS
| NMWO 2014 Adult rate | NMWO 2014 Junior Rate | Casual Loading | Entitlements | |||||||||
| Name | Age | Start | Finish | Meal break | Hours Worked | 25% | Ordinary hours | Casual loading | Totals | NMWO 2014 Underpayment | SNC Entitlement underpayment | |
| [B] | Adult | 7 | 18 | 1 | 10 | $16.87 | $4.22 | $168.70 | $42.20 | $210.90 | $210.90 | $300.00 |
| [C] | Adult | 7 | 18 | 1 | 10 | $16.87 | $4.22 | $168.70 | $42.20 | $210.90 | $210.90 | $300.00 |
| [D] | 19 | 7 | 18 | 1 | 10 | $13.92 | $3.48 | $139.20 | $34.80 | $174.00 | $174.00 | $300.00 |
| [E] | Adult | 7 | 18 | 1 | 10 | $16.87 | $4.22 | $168.70 | $42.20 | $210.90 | $210.90 | $300.00 |
| [F] | Adult | 7 | 18 | 1 | 10 | $16.87 | $4.22 | $168.70 | $42.20 | $210.90 | $210.90 | $300.00 |
| [L] | Adult | 7 | 18 | 1 | 10 | $16.87 | $4.22 | $168.70 | $42.20 | $210.90 | $210.90 | $300.00 |
| [M] | Adult | 7 | 18 | 1 | 10 | $16.87 | $4.22 | $168.70 | $42.20 | $210.90 | $210.90 | $300.00 |
| [N] | Adult | 7 | 18 | 1 | 10 | $16.87 | $4.22 | $168.70 | $42.20 | $210.90 | $210.90 | $300.00 |
| [P] | Adult | 7.2 | 18 | 1 | 9.67 | $16.87 | $4.22 | $163.13 | $40.81 | $203.94 | $203.94 | $290.10 |
| [A] | Adult | 7.15 | 18 | 1 | 9.75 | $16.87 | $4.22 | $164.48 | $41.15 | $205.63 | $205.63 | $292.50 |
| [Q] | 17 | 7 | 18 | 1 | 10 | $9.75 | $2.44 | $97.50 | $24.40 | $121.90 | $121.90 | $300.00 |
| [O] | 19 | 7 | 18 | 1 | 10 | $13.92 | $3.48 | $139.20 | $34.80 | $174.00 | $174.00 | $300.00 |
| [T] | Adult | 7.3 | 18 | 1 | 9.5 | $16.87 | $4.22 | $160.27 | $40.09 | $200.36 | $200.36 | $285.00 |
| [G] | Adult | 7.10 | 18 | 1 | 9.83 | $16.87 | $4.22 | $165.83 | $41.48 | $207.31 | $207.31 | $294.90 |
| [R] | Adult | 7 | 18 | 1 | 10 | $16.87 | $4.22 | $168.70 | $42.20 | $210.90 | $210.90 | $300.00 |
| [S] | Adult | 7 | 18 | 1 | 10 | $16.87 | $4.22 | $168.70 | $42.20 | $210.90 | $210.90 | $300.00 |
| [I] | 19 | 7 | 18 | 1 | 10 | $13.92 | $3.48 | $139.20 | $34.80 | $174.00 | $174.00 | $300.00 |
| [H] | Adult | 7.3 | 18 | 1 | 9.5 | $16.87 | $4.22 | $160.27 | $40.09 | $200.36 | $200.36 | $285.00 |
| [U] | Adult | 7.3 | 18 | 1 | 9.5 | $16.87 | $4.22 | $160.27 | $40.09 | $200.36 | $200.36 | $285.00 |
| [K] | Under 16 | 7.15 | 18 | 1 | 9.75 | $6.21 | $1.55 | $60.55 | $15.11 | $75.66 | $75.66 | $292.50 |
| [J] | 19 | 7.1 | 18 | 1 | 9.83 | $13.92 | $3.48 | $136.83 | $34.21 | $171.04 | $171.04 | $294.90 |
| TOTALS | $3205.03 | $801.63 | $4,006.66 | $4,006.66 | $6,219.90 | |||||||
Schedule 2
| First Respondent | ||||||||||||
| FW Act Provision | Number of Contraventions before s 557 FW Act | Amounts | Maximum possible penalty | Grouping - s 557 & to a/c for common elements | Total employees affected | Maximum possible penalty (post-grouping) | Maximum penalty (cooperation discount) | Penalty range | Proposed penalty % | Proposed penalty amount | ||
| 10% | Min | Max | Min | Max | ||||||||
| s 293 - national minimum wage | 21 | $4,006.66 | $51,000.00 | 1 | 21 Employees | $51,000.00 | $45,900.00 | High | 70 | 80 | $32,130.00 | $36,720.00 |
| s 323 - fail to pay wages in full and at least monthly | 21 | $4,006.66 | $51,000.00 | 1 | 21 Employees | $51,000.00 | $45,900.00 | No penalty | N/A | N/A | Nil | Nil |
| s 535(1) - fail to make and keep employee records | 21 | N/A | $25,500.00 | 1 | 21 Employees | $25,500.00 | $22,950.00 | Medium | 40 | 50 | $9,180.00 | $11,475.00 |
| s 712(3) - fail to comply with notice to produce records or documents | 1 | N/A | $51,000.00 | N/A | N/A | $51,000.00 | $45,900.00 | Medium | 40 | 50 | $18,360.00 | $22,950.00 |
| Total | $59,670.00 | $71,145.00 | ||||||||||
| Second Respondent | ||||||||||||
| FW Act Provision | Number of Contraventions before s 557 FW Act | Amounts | Maximum possible penalty | Grouping - s 557 & to a/c for common elements | Total employees affected | Maximum possible penalty (post-grouping) | Maximum penalty (cooperation discount) | Penalty range | Proposed penalty % | Proposed penalty amount | ||
| 10% | Min | Max | Min | Max | ||||||||
| s 293 - national minimum wage | 21 | $4,006.66 | $10,200.00 | 1 | 21 Employees | $10,200.00 | $9,180.00 | High | 70 | 80 | $6,426.00 | $7,344.00 |
| s 323 - fail to pay wages in full and at least monthly | 21 | $4,006.66 | $10,200.00 | 1 | 21 Employees | $10,200.00 | $9,180.00 | No penalty | N/A | N/A | Nil | Nil |
| s 535(1) - fail to make and keep employee records | 21 | N/A | $5,100.00 | 1 | 21 Employees | $5,100.00 | $4,590.00 | Medium | 40 | 50 | $1,836.00 | $2,295.00 |
| s 712(3) - fail to comply with notice to produce records or documents | 1 | N/A | $10,200.00 | N/A | N/A | $10,200.00 | $9,180.00 | Medium | 40 | 50 | $3,672.00 | $4,590.00 |
| Total | $11,934.00 | $14,229.00 | ||||||||||
[49] [2011] VMC 81 at [51].
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