Fair Work Ombudsman v Phone Collection Pty Ltd
[2016] FCCA 2886
•15 November 2016
FEDERAL CIRCUIT COURT OF AUSTRALIA
| FAIR WORK OMBUDSMAN v PHONE COLLECTION PTY LTD & ANOR | [2016] FCCA 2886 |
| Catchwords: INDUSTRIAL LAW – Fair work – pecuniary penalties – breaches of award – agreed statement of facts – consideration of matters relevant to penalty – grouping of breaches. |
| Legislation: Fair Work Act 2009, ss.45, 550, 571(1) General Retail Industry Award 2010, cl.12.7, 17 |
| Cases cited: Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith (2008) 246 ALR 35 Mornington Inn v Jordan (2008) 168 FCR 383 Mason v Harrington Corporation Pty Ltd t/as Pangaea Restaurant & Bar [2007] FMCA 7 |
| Applicant: | FAIR WORK OMBUDSMAN |
| First Respondent: | PHONE COLLECTION PTY LTD |
| Second Respondent: | KAM MAN YAU |
| File Number: | MLG 2517 of 2015 |
| Judgment of: | Judge McNab |
| Hearing date: | 26 September 2016 |
| Date of Last Submission: | 26 September 2016 |
| Delivered at: | Melbourne |
| Delivered on: | 15 November 2016 |
REPRESENTATION
| Counsel for the Applicant: | Mr Tracey |
| Solicitors for the Applicant: | The Office of the Fair Work Ombudsman |
| Counsel for the Respondents: | Mr Champion |
| Solicitors for the Respondents: | Victor Tse & Associates |
IT IS DECLARED THAT:
The First Respondent has contravened:
(a)Section 45 of the Fair Work Act 2009 (Cth) (“FW Act”) by failing to pay Mr Bai the minimum hourly rate of pay for ordinary hours worked as required by cl.12.7 and cl.17 of the General Retail Industry Award 2010 (Cth) (“the Modern Award”);
(b)Section 45 of the FW Act by failing to pay Mr Bai the evening penalty rate for hours worked after 6pm, as required by cl.29.4(c) of the Modern Award;
(c)Section 45 of the FW Act by failing to pay Mr Bai the penalty rate for all hours worked on a Sunday, as required by cl.29.4(c) of the Modern Award;
(d)Section 45 of the FW Act by failing to pay Mr Bai the public holiday penalty for ordinary hours worked on a public holiday, as required by cl.29(d) of the Modern Award;
(e)Section 44 of the FW Act by failing to pay Mr Bai his accrued but untaken annual leave entitlements upon termination of his employment as required by subsection 90(2) of the FW Act;
(f)Section 45 of the FW Act by failing to pay Mr Bai superannuation contributions as required by cl.22.2 of the Modern Award;
(g)Subsection 535(1) of the FW Act by failing to keep employee records of the kind prescribed by the Fair Work Regulations 2009 (Cth) (“FW Regulations”); and
(h)Subsection 536(1) of the FW Act by failing to provide Mr Bai with a pay slip within one working day of payment with respect to work performed by him.
The Second Respondent was involved in each of the contraventions of the First Respondent set out in paragraph 1(a) to (h) above.
ORDERS
The First Respondent pay a penalty in the amount of $20,000 pursuant to s.546(1) of the Fair Work Act 2009 (Cth) (“FW Act”) for the contraventions set out in the declarations made this day.
The Second Respondent pay a penalty in the amount of $3,000 pursuant to s.546(1) of the Fair Work Act 2009 (Cth) (“FW Act”) for the contraventions set out in the declarations made this day.
Pursuant to s.546(3)(a) of the FW Act, the First and Second Respondents pay their respective penalty amount to the Commonwealth.
The proceedings are otherwise dismissed.
The Court orders that a stay be granted for a period of 60 days from the date of this order.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLG 2517 of 2015
| FAIR WORK OMBUDSMAN |
Applicant
And
| PHONE COLLECTION PTY LTD |
First Respondent
| KAM MAN YAU |
Second Respondent
REASONS FOR JUDGMENT
Introduction
In this litigation, a civil penalty proceeding for contravention of industrial instruments, the parties filed a Statement of Agreed Facts on 11 March 2016.
The Applicant relies upon the following in support of the Applicant’s Submissions filed 21 June 2016 and the Applicant’s Reply Submission on Penalty filed 19 August 2016:-
a)Amended Application and Amended Statement of Claim filed on 02 March 2016;
b)Statement of Agreed Facts (“SOAFS”) filed on 11 March 2016;
c)Affidavit of Fair Work Inspector Katherine Lucy Goonan (“FWI Goonan”), affirmed 22 March 2016 (“Goonan affidavit”); and
d)Affidavit of the Second Respondent, Mr Kam Man Yau, affirmed 2 May 2016 (“Yau affidavit”).
The Respondents rely upon an Affidavit of the Second Respondent,
Mr Kam Man Yau, affirmed 2 May 2016. In support of the affidavit, the Respondents also rely upon their Submissions filed on26 July 2016.
The Applicant seeks the imposition of pecuniary penalties on the Respondents in relation to contraventions of the Workplace Relations Act 2006 (Cth) (‘the WR Act’), the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth) (‘the Transitional Act’) and the Fair Work Act 2009 (Cth) (‘the FW Act’) and the Regulations made under the legislation.
The contraventions concern the employment of Mr Jingxi Bai
(“Mr Bai”) by the First Respondent. Mr Bai was employed by the
First Respondent between 1 April 2014 and 19 September 2014.
In summary, during the Applicant’s employment, the First Respondent failed to pay the Applicant:a)the minimum hourly rate of pay for ordinary hours worked as required by cl.12.7 and cl.17 of the General Retail Industry Award 2010 (Cth) (“the Modern Award”);
b)the penalty rates for evening work, weekend work and work on public holidays; and
c)annual leave loading and superannuation contributions.
In addition, the First Respondent did not provide the employee with pay slips, nor did it provide Mr Bai with a pay slip within one working day of payment with respect to work performed by him.
The contraventions resulted in the employee being underpaid a total amount of $4,028.96 over the period of his employment by the
First Respondent.At all relevant times, the Second Respondent was the sole director and secretary of the First Respondent (excluding the period from
24 June 2014 to 17 July 2014 inclusive). He was responsible for the financial and operating policies, management and operation of the business, including in relation to compliance with industrial instruments and arrangements, setting pay rates and commissions, authorising and effecting payment of wages to its employees. He was responsible for ensuring that the First Respondent complied with its legal obligation under the FW Act including for the making and keeping of records for the First Respondent in relation to its employees. Also, he was responsible for making decisions on behalf of the First Respondent regarding the terms and conditions upon which its employees would be employed by the First Respondent, the work to be performed, the rostering, and the time, method and manner of payment to its employees.From 1 April 2014 to 19 September 2014, the First Respondent employed Mr Bai to work in its “Express Repair” kiosk at the Bayside Shopping Centre in Frankston, Victoria as a part time employee.
He repaired mobile phones, such as screen repairs and repairs to components inside the phone, including but not limited to the camera and speakers and selling mobile phone accessories.
Mr Bai was paid an average of $13.16 per hour through his employment with the First Respondent in respect of all hours he worked including evening hours, Sunday hours and public holiday hours.
A Statement of Agreed Facts was filed by the Applicant and Respondents in these proceedings for the purposes of s.191 of the Evidence Act 1995 (Cth). The First Respondent accepted that Declarations of contraventions of the FW Act would be made and there would be an order for payment of the balance of the underpayment. The Second Respondent admitted accessorial liability. They each had actual knowledge of the factual matters which comprised the contraventions admitted by the First Respondent.
The Applicant’s Submissions on Penalty filed 19 August 2016 argue that the contraventions were deliberate; that the Second Respondent can be said to be the ‘controlling mind’ of the First Respondent; the Court should not differentiate between the Second Respondent’s culpability and that of the First Respondent; the Second Respondent does not show true contrition and the proposed penalties are just and appropriate and act as a deterrent.
The proposed 25% discount was included in recognition of an apology to Mr Bai, an acceptance of responsibility and corrective action taken by the Respondents.
The First Respondent’s conduct is admitted to have resulted in multiple contraventions of the FW Act and the Modern Award.
The Second Respondent admits that he was the controlling mind of the First Respondent and involved in each of the Contraventions set out at [4] of the SOAFS, within the meaning of s.550 of the FW Act and is therefore treated as having himself contravened each of those Contraventions.
Section 557(1) of the FW Act provides that two or more contraventions of a term of a civil remedy provision are taken to constitute a single contravention if the contraventions are committed by the same person and arose out of a course of conduct by that person.
The Applicant accepts that the First Respondent is entitled to the benefit of the course of conduct provision in relation to repeated breaches of each relevant provision; for instance that the multiple contraventions of s.45 of the FW Act arising from the failure to pay minimum wages under the Modern Award, should be treated as a single breach. The repeated failure over a period of time to make and keep records containing particular content also attracts the operation of this provision.
If the Court were to adopt the grouping proposed by the Applicant in relation to determination of penalty, the admitted contraventions would be grouped into 8 groups of contraventions. That would give rise to a maximum penalty that could be imposed on the First Respondent of $357,000 and on the Second Respondent of $71,400.
The Applicant submitted that the appropriate aggregate penalties (including the application of a discount of 25%) in this matter falls within the following ranges:
a)for the First Respondent: $130,050.00 - $183,600.00; and
b)for the second Respondent: $26,010.00 - $36,720.00.
If the Court were to adopt the grouping proposed by the Respondents, there would be 5 groups of contravention. These groupings would be:
i)failure to pay minimum rates;
ii)failure to pay evening penalties, Sunday penalties and public holiday penalties;
iii)failure to pay annual leave;
iv)failure to pay superannuation contributions;
v)failure to keep proper employee records.
Factors relevant to penalty
[1] [2007] FMCA 7 at [26] to [59]
A non-exhaustive list of factors relevant to the imposition of a penalty was usefully summarised by Mowbray FM (as he then was) in
Mason v Harrington Corporation Pty Ltd t/as Pangaea Restaurant & Bar.[1]Those factors include:-
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 Respondents;
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, taken corrective action and co-operated with the enforcement authorities;
j)the need to ensure compliance with minimum standards by provision of an effective means for investigation and enforcement of employee entitlements; and
k)the need for specific and general deterrence.
This summary was adopted by Tracey J in Kelly v Fitzpatrick.[2] While the summary is a convenient checklist, it does not prescribe or restrict the matters which may be taken into account in the exercise of the Court’s discretion.[3] The discretion remains at large.
[2] [2007] FCA 1080 at [14]
[3] Sharpe v Dogma Enterprises Pty Ltd [2007] FCA 1550
The factors which are material to this matter and the question of appropriate penalties are addressed below. What the Court needs to determine is an appropriate penalty proportionate to the gravity of the contravention.
Nature, extent and circumstances of the contravening conduct
Mr Bai was subject to a subclass 485 temporary graduate visa during his Employment Period. From 1 April 2014 to 19 September 2014, the First Respondent employed Mr Bai to work in its “Express Repair” kiosk at the Bayside Shopping Centre in Frankston, Victoria as a part time employee. He repaired mobile phones, such as screen repairs and repairs to components inside the phone, including but not limited to the camera and speakers and selling mobile phone accessories.
Mr Bai was paid an average of $13.16 per hour resulting in an underpayment of $4,028.96 over a period of approximately five and a half months. The Respondents submitted that the intended arrangement was for Mr Bai to receive a base salary of $15 an hour and an additional $6.50 “bonus” hourly upon the achievement of necessary sales. However, no provision was made in the event that he did not achieve the required sales to receive the bonus payment. He was not paid the appropriate penalties in respect of all hours he worked including evening hours, Sunday hours and public holiday hours.
No submission was made by the Applicant that the arrangement entered into was in breach of the Act had the “bonus” been paid.
The Applicant submitted that the Respondents engaged in a concerted effort to avoid meeting their obligations under the FW Act and the Modern Award prior to the commencement of proceedings. The Second Respondent sent an email to FWI Goonan on 25 May 2015, explaining that: “[B]ecause our bonus is quite big, therefore we do not offer the penalty rate as part of the basic wages.”
Mr Yau gave evidence of his reasons for the arrangement he entered into with the employee as follows:
23.The arrangement for payment to Mr Bai was intended to be that he would receive a base salary of $15.00 hourly + $6.50 “bonus” hourly on achieving necessary sales. It has been my experience that a “bonus” component gives a good incentive to retail employees.
24.My understanding of the Award was that provided the base salary and the “bonus” were more than the award minimum rates, Phone Collection complied with its minimum obligations. Most employees received their bonuses most hours. I did not deliberately underpay employees because my intention was to satisfy the award obligations in this way. With the incentive of the bonus payment most retail employees of Phone Collection were paid more than the minimum rates under the Award. Because I knew about the Award (and minimum rates) the hourly bonus was intended to mean that employees would be paid minimum rates. I anticipated that employees would earn sufficient bonuses to earn more than the minimum rates under the award. The system was not adequate, however, to ensure that an employee, such as Mr Bai, who did not make enough sales to earn an hourly bonus was paid minimum rates under the Award. I have now changed the system.
25.Phone Collection’s systems and processes on the hiring of Mr Bai were inadequate. Phone Collection did not obtain Mr Bai’s Tax File Number (“TFN”) during employment. Details as to Mr Bai’s preferred superannuation fund were not obtained in a timely way.
26.As it happened, Mr Bai actually received an average amount of $13.16 per hour. That was the amount he actually received. He was not paid the necessary loadings for evening hours, Sunday hours and public holiday hours. As I have explained in paragraph 24 above, I intended that bonuses cover all minimum rates under the award but I did not have adequate systems in place to ensure this occurred.
The Applicant further submits that the Second Respondent knew that the Modern Award applied, after being expressly made aware of the application of the Modern Award to the First Respondent’s business (including the existence of penalty payments and other relevant entitlements) from correspondence issued by the Applicant to the Second Respondent dated 1 March 2013. Further, the First Respondent advertised for staff on the basis of a payment of a base rate, plus commission, plus a bonus. The advertisement did not mention that staff wages would be ‘topped up’, nor did it say that the advertised rates only apply after a training period.
The Respondents accept that Phone Collection had inadequate systems in place to ensure that if an employee did not achieve the “bonus” that employee nonetheless received the award minimum entitlements and that the First Respondent paid most employees more than the Award minimum rates.
The advertisement was published in Korean and purported to encourage prospective employees to apply for a position with the First Respondent as a means of improving their English language skills. The Applicant submitted that a heightened responsibility is imposed on the First Respondent to ensure that it complied with its obligations to employees from non-English speaking backgrounds, who could be described as vulnerable, as their language skills and knowledge of Australian workplace laws may leave them with limited understanding of their rights under Australian workplace laws.[4] I accept that submission.
[4] Applicant’s Submission on Penalty, filed 21 June 2016 at [47]
Similar previous conduct
The Respondents have not previously been the subject of proceedings by the Applicant or its predecessors for contraventions of Australian workplace laws. However, the Respondents have previously been the subject of the Applicant’s attention as they have engaged in similar conduct in the past. The Applicant’s submissions refer to the
“Lee Complaint” and “Ren Complaint” which involved underpayments and where the Second Respondent was sent in both instances, the rates contained in the Modern Award and informed that the Respondents were bound by that award by the Applicant.
Size and financial circumstances
In Rajagopalan v BM Sydney Building Materials Pty Ltd [2007] FMCA 1412, Driver FM (as he then was) provided a summary of the case law at [27] in this respect:-
Employers must not be left under the impression that because of their size or financial difficulty that they are able to breach an award. Obligations by employers for adherence to industrial instruments arise regardless of their size. Such a factor should be of limited relevance to the Court's consideration of penalty. As stated recently, by Tracey J in Kelly v Fitzpatrick [2007] FCA 1080, at [28]:
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.
The First Respondent operates a business which includes the operation of seven mobile phone kiosks in shopping centres in Victoria and South Australia, with approximately 40 employees. The Second Respondent, along with I Collection Pty Ltd, is involved in the operation of 14 phone kiosks, and is the current director and secretary of nine corporate entities. I bear the above authority in mind when fixing penalties in this matter, which requires a “meaningful” penalty to be imposed.
Deterrence
It is well-established that the need for specific and general deterrence is a factor that is relevant to the imposition of a civil penalty.
In Ponzio v B & P Caelli Constructions Pty Ltd Lander J. said:
“The penalty must recognise the need for deterrence, both personal and general. In regard to personal deterrence, an assessment must be made of the risk of re-offending. In regard to general deterrence, it is assumed that an appropriate penalty will act as a deterrent to others who might be likely to offend: Yardley v Betts (1979) 22 SASR 108. The penalty therefore should be of a kind that it would be likely to act as a deterrent in preventing similar contraventions by like-minded persons or organisations. If the penalty does not demonstrate an appropriate assessment of the seriousness of the offending, the penalty will not operate to deter others from contravening the section. However, the penalty should not be such as to crush the person upon whom the penalty is imposed or used to make that person a scapegoat. In some cases, general deterrence will be the paramount factor in fixing the penalty.”[5]
[5] [2007] FCAFC 65 at [93]
Totality
It is important for the Court to take a final look at 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.[6]
[6] See Kelly v Fitzpatrick [2007] FCA 1080 at [30], Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith (2008) 246 ALR 35
Conduct of the Respondents in relation to this proceeding
A factor relevant to the imposition of a penalty under the FW Act is the contrition, corrective action and cooperation with the authorities of the Respondents in relation to this proceeding. The conduct of the Respondents is as follows:
a)the employee Mr Bai raised concerns directly with the Fair Work Ombudsman rather than his employer;
b)the employer became aware of the complaint on 21 May 2015;
c)
the employer acted to make good the underpayment on
1 June 2015 and when he was subsequently advised by the Applicant on 14 September 2015 that a further payment was required ($1766) that was paid shortly thereafter;
d)the Applicant commenced these proceedings after the underpayment was rectified;
e)the employer admitted to contravening the Act shortly after proceedings were issued and before filing a defence. The conduct of the employer has meant that there has been no need for a liability hearing.
I accept that in this case, there are considerations of general deterrence and specific deterrence arising directly because of the fact that there have been two similar complaints made in relation to underpayment prior to proceedings being issued. I also accept the evidence of Mr Yau that the present underpayment arose in circumstances where his business expanded rapidly, that he was under a certain amount of personal stress because of the expansion of the business and the fact that he had become a new father.[7] I accept that he has put into place, with the assistance of its legal and accounting advisers, systems to rectify the issues. In [34] to [37] of his affidavit, Mr Yan has deposed to the corrective changes to the business system to avoid repetition of the breaches.
[7] Response affidavit [33]
Grouping of Breaches
In my view, the breaches although constituting separate breaches of the Act do all arise out of a common course of conduct deriving from the decision to pay a base rate with a bonus.
I accept the submission of the Respondents that where the contraventions have common elements, this should be taken into account in considering the appropriate penalty for each contravention, which practice is referred to as the grouping principal.[8] I am also conscious that although the underpayment is a serious matter for the employee, the quantum of it is a relatively small amount when compared to the quantum of the penalty sought by the Applicant. In my view, the penalty sought by the Applicant in this case is disproportionate to the level of contravention.
[8] Respondent’s submissions at [27] and Fair Work Ombudsman v Lifestyle SA Pty Ltd [2014] FCA 1151 Mansfield J at 160
I also accept the submission that it is appropriate to deal with the Second Respondent as separate to that of the company. This is particularly in circumstances where the Second Respondent did not hire the employee and has no recollection of ever meeting the employee.[9] The penalties sought to be imposed by the Applicant represent a sum in excess of 60 times the quantum of the underpayment. In my view, this is disproportionate. I have had regard to the submissions made on behalf of the Applicant and I have also had regard to the maximum penalties which may be imposed.
[9] Mr Yau’s affidavit at [14]
In this matter, having regard to the admissions that were made at the earliest possible time and the cooperation that the Respondents have extended through the course of this proceeding, the Respondents have engaged in significant mitigating conduct by paying the Applicant in full upon having notice of the underpayment. In my view, the methodology for the fixing of penalty proposed by the respondents is based on a submission that gives a careful consideration of the evidence before the court and a thorough and even-handed analysis of the relevant authorities.
In this case, the Applicant proposes a penalty at the upper end of the range as to underpayment (70% to 90%) for 8 contraventions. The adoption of that position suggests that the conduct is in the category of the worst possible case before the court. I do not accept that is the position of the Respondents in circumstances where the conduct involves one employee, where the employee has been repaid in full and the employer has admitted contraventions and cooperated with the Applicant at the first opportunity.
The Applicant submitted that the 8 contraventions should be treated so that contraventions 2-4 and 7-8 be grouped. The Applicants have proposed a more limited penalty for contraventions 2 and 4 to reflect the fact that each contravention occasioned a loss to Mr Bai of about $100. The maximum penalty for each contravention is attached and marked Annexure “A”. Annexure “B” sets out the penalties sought by the Applicant and the proposals put by the Respondents (including grouped and ungrouped contraventions).
In my view, the grouping of breaches as proposed by the Respondents is appropriate in circumstances where the breaches arise out of one multifaceted course of conduct.[10] The methodology for the fixing of penalty proposed by the Respondents is based on a submission that gives a careful consideration of the evidence before the court and a thorough and even-handed analysis of the relevant authorities.
[10] Mornington Inn v Jordan (2008) 168 FCR 383 at [40] to [46].
I accept the submission that the offending parties should not be treated as immune in respect of the breach of an obligation because it arises from a course of conduct.[11] However, the grouping proposed takes into account the competing views in relation to the treatment of offending conduct which results in multiple breaches.
[11] Gibbs v Mayor Councillors and Citizens of the City of Altona [1992] FCA 553; 37 FCR 216; 42 IR 255 (Gray J) at 233.
Conclusion
In my view, it is appropriate to impose a penalty taking into account the above matters and that the appropriate level of penalty in the exercise of my discretion is $20,000 in respect of the First Respondent and $3000 in respect of the First Respondent. I stay the payment of the penalties for 60 days from this date ( such order not being opposed by the Applicant).
The penalties are significant in comparison to the loss occasioned. They take into account the prior complaints made and the failure to implement a system in response to those complaints. The penalties will act as a general and specific deterrent. They also take into account the Respondents’ cooperation, mitigating conduct and the costs of actively participating in these proceedings.
The applicant sought orders in the form of an injunction directed to the Respondents not further breaching the Act. I decline to make that order as it is simply an order requiring the respondents to comply with the law and as such has no real utility other than to expose the Respondents to a criminal sanction in the event that they breach an court ordered injunction.
I certify that the preceding forty-eight (48) paragraphs are a true copy of the reasons for judgment of Judge McNab
Date: 15 November 2016
Annexure “A”
| Contravention | Number of penalty units | Maximum penalty individual | Maximum penalty body corporate |
| Failure to pay required minimum hourly rate of pay for ordinary hours worked (s 45 FW Act, clauses 12.7 and 17 of the Modern Award) | 60 | $10,200 | $51,000 |
| Failure to pay applicable evening penalty for ordinary hours worked after 6 pm (s 45 of the FW Act, subclause 29.4(a) and clause A.7.3 of Schedule A of the Modern Award) | 60 | $10,200 | $51,000 |
| Failure to pay penalty rate for all hours worked on a Sunday (s 45 of the FW Act, subclause 29.4(c) of the Modern Award) | 60 | $10,200 | $51,000 |
| Failure to pay penalty rate for ordinary hours worked on a public holiday (s 45 of the FW Act, subclause 29.4(d) of the Modern Award) | 60 | $10,200 | $51,000 |
| Failure to pay accrued but untaken annual leave on termination of employment (s 44 of the FW Act, s 90(2) of the FW Act) | 60 | $10,200 | $51,000 |
| Failure to pay superannuation contributions (s 45 of the FW Act, clause 22.2 of the Modern Award) | 60 | $10,200 | $51,000 |
| Failure to keep employee records (s 535 of the FW Act) | 30 | $5,100 | $25,500 |
| Failure to provide pay slips (s 536 of the FW Act) | 30 | $5,100 | $25,500 |
| Total: | $71,400 | $357,000 |
Annexure “B”
First Respondent
| Contravention | Maximum penalty | With 25% discount | Applicant’s Proposed range Min Max | Respondent’s proposed range grouped Min Max | Respondent’s proposed range Ungrouped Min Max | ||
| (1) Failure to pay required minimum hourly rate of pay for ordinary hours worked (s 45 FW Act, clauses 12.7 and 17 of the Modern Award) | $51,000 | $38,250 | 70% $26,775 | 90% $34,425 | 20% 35% $7,650 $13,387 | 20% 35% $7,650 $13,387 | |
| (2)Failure to pay applicable evening penalty for ordinary hours worked after 6 pm (s 45 of the FW Act, subclause 29.4(a) and clause A.7.3 of Schedule A of the Modern Award) | $51,000 | $38,250 | 40% $15,300 | 60% $22,950 | 15% 30% Note: | 5% 10% $1,912 $3,825 | |
| (3)Failure to pay penalty rate for all hours worked on a Sunday (s 45 of the FW Act, subclause 29.4(c) of the Modern Award) | $51,000 | $38,250 | 60% $22,950 | 80% $30,600 | Note: Contraventions 2-4 are grouped | 10% 20% $3,825 $7650 | |
| (4) Failure to pay penalty rate for ordinary hours worked on a public holiday (s 45 of the FW Act, subclause 29.4(d) of the Modern Award) | $51,000 | $38,250 | 40% $15,300 | 60% $22,950 | Note: Contraventions 2-4 are grouped | 5% 10% $1,912 $3,825 | |
| (5) Failure to pay accrued but untaken annual leave on termination of employment (s 44 of the FW Act, s 90(2) of the FW Act) | $51,000 | $38,250 | 40% $15,300 | 60% $22,950 | 10% 25% $3,825 $9,562 | 10% 25% $3,825 $9,562 | |
| (6) Failure to pay superannuation contributions (s 45 of the FW Act, clause 22.2 of the Modern Award) | $51,000 | $38,250 | 30% $11,475 | 50% $19,125 | 10% 25% $3,825 $9,562 | 10% 25% $3,825 $9,562 | |
| (7) Failure to keep employee records (s 535 of the FW Act) | $25,500 | $19,125 | 60% $11,475 | 80% $15,300 | 10% 25% $1,912 $4,781 | 5% 15% $956 $2,868 | |
| (8) Failure to provide pay slips (s 536 of the FW Act) | $25,500 | $19,125 | 60% $11,475 | 80% $15,300 | Contraventions 7- 8 are grouped | 5% 15% $956 $2,868 | |
| Total: | $357,000 | $267,750 | $130,050 | $183,600 | $22,949 $48,767 | $24,861 $53,547 | |
| Apply 15% further reduction in an application of the totality principle | |||||||
| Total after application of totality principle: | $65,025.00 | $84,532.50 | $19,507 $42,806 | $21,132 $45,515 | |||
Second Respondent
| Contravention | Maximum penalty | With 25% discount | Applicant's Proposed range Min Max | Respondent’s proposed range grouped Min Max | Respondent’s proposed range Ungrouped Min Max | |
| (1)Failure to pay required minimum hourly rate of pay for ordinary hours worked (s 45 FW Act, clauses 12.7 and 17 of the Modern Award) | $10,200 | $7,650 | 70% $5,355 | 90% $6,885 | 15% 30% $1,147 $2,295 | 15% 30% $1,147 $2,295 |
| (2) Failure to pay applicable evening penalty for ordinary hours worked after 6 pm (s 45 of the FW Act, subclause 29.4(a) and clause A.7.3 of Schedule A of the Modern Award) | $10,200 | $7,650 | 40% $3,060 | 60% $4,590 | 10% 25% $765 $1,912 | 5% 10%$382 $765 |
| (3) Failure to pay penalty rate for all hours worked on a Sunday (s 45 of the FW Act, subclause 29.4(c) of the Modern Award) | $10,200 | $7,650 | 60% $4,590 | 80% $6,120 | Note: Contraventions 2-4 are grouped | 5% 10% $382 $765 |
| (4) Failure to pay penalty rate for ordinary hours worked on a public holiday (s 45 of the FW Act, subclause 29.4(d) of the Modern Award) | $10,200 | $7,650 | 40% $3,060 | 60% $4,590 | Note: Contraventions 2-4 are grouped | 5% 10% $382 $765 |
| (5) Failure to pay accrued but untaken annual leave on termination of employment (s 44 of the FW Act, s 90(2) of the FW Act) | $10,200 | $7,650 | 40% $3,060 | 60% $4,590 | 5% 20% $382 $1,530 | 5% 20% $382 $1,530 |
| (6) Failure to pay superannuation contributions (s 45 of the FW Act, clause 22.2 of the Modern Award) | $10,200 | $7,650 | 30% $2,295 | 50% $3,825 | 5% 20% $382 $1,530 | 5% 20% $382 $1,530 |
| (7) Failure to keep employee records (s 535 of the FW Act) | $5,100 | $3,825 | 60% $2,295 | 80% $3,060 | 5% 20% $191 $765 | 10% $382 |
| (8) Failure to provide pay slips (s 536 of the FW Act) | $5,100 | $3,825 | 60% $2,295 | 80% $3,060 | Contraventions 7-8 are grouped | 10% $382 |
| Total: | $71,400 | $53,550 | $26,010 | $36,720 | $2,867 $8,032 | $3,057 $8,414 |
| Apply 15% further reduction in an application of the totality principle | ||||||
| Total after application of totality principle: | $14,305.50 | $19,507.50 | $2,437 $6,827 | $2,598 $7,152 | ||
Key Legal Topics
Areas of Law
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Employment Law
Legal Concepts
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Breach
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Penalty
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Remedies
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