Fair Work Ombudsman v Polyfone Telecom Pty Ltd

Link copied
Case Copied 16 min read

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 2)

Fair Work Ombudsman v Polyfone Telecom Pty Ltd [2023] FedCFamC2G 807

File number(s): BRG 89 of 2022
Judgment of: JUDGE MANSINI
Date of judgment: 16 October 2023   
Catchwords: INDUSTRIAL LAW – application for declaratory relief – where Second Respondent contravened the Fair Work Act 2009 (Cth) by being involved in the First Respondent’s contravention of s.716(5) – question of penalty (if any) to be determined separately.
Legislation:

Fair Work Act 2009 (Cth) ss.90(2), 99, 539, 545(2), 546, 550, 716

Federal Circuit and Family Court of Australia Act 2021 (Cth) s.190

Corporations Act 2001 (Cth) s.471B

Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) r.13.10

Clerks – Private Sector Award 2020

Telecommunications Services Award 2020  
Cases cited: Fair Work Ombudsman v Tsurc Pty Ltd [2014] FCCA 2472
Division: Division 2 General Federal Law
Number of paragraphs: 47
Date of hearing: 4 September 2023
Place: Melbourne (by web conference)
Counsel for the Applicant: Ms P Willoughby
Solicitor for the Applicant: Fair Work Ombudsman
First Respondent: No appearance
Second Respondent: Litigant in person

ORDERS

BRG 89 of 2022

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN:

FAIR WORK OMBUDSMAN

Applicant
AND:

POLYFONE TELECOM PTY LIMITED (ACN 109 390 490)

First Respondent

PAUL DESMOND WALLACE

Second Respondent

ORDER MADE BY:

JUDGE MANSINI

DATE OF ORDER:

16 OCTOBER 2023

THE COURT ORDERS THAT:

1.The proceedings against the First Respondent be permanently stayed.

THE COURT DECLARES THAT:

2.The Second Respondent was involved, within the meaning of s.550(2) of the Fair Work Act 2009 (Cth) (Act), in the First Respondent’s failure to comply with the statutory compliance notice dated 11 February 2021 and contravention of s.716(5) of the Act.

THE COURT FURTHER ORDERS THAT:

3.The matter be listed for directions before Judge Vasta at 9.30 am (AEST) on 23 October 2023 in-person in the Brisbane registry.

4.The parties have liberty to apply.

Note: The form of the order is subject to the entry in the Court’s records.

Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).

REASONS FOR JUDGMENT

JUDGE MANSINI

INTRODUCTION

  1. This is an application by the Fair Work Ombudsman (FWO) in relation to a telecommunications and parts business that did not comply with a statutory compliance notice.

  2. The notice was issued following a FWO investigation by which the FWO concluded that there had been underpayments in respect of minimum entitlements to paid personal or carer’s leave and paid annual leave on termination.

  3. Since these proceedings commenced, the First Respondent company was placed into liquidation and the FWO no longer sought to continue against it. The Second Respondent initially opposed…

CaseChat AU logo

Keep reading for free

Create a free CaseChat account to read Fair Work Ombudsman v Polyfone Telecom Pty Ltd and more:

  • Read every judgment in full
  • Ask AI and get answers linked to paragraphs
  • See how each paragraph was cited in later cases
  • Download judgments as PDF or Word
Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details
Case
[2023] FedCFamC2G 807
Decision Date

CaseChat Overview and Summary

The Fair Work Ombudsman (FWO) filed an application against Polyfone Telecom Pty Ltd and its director, Mr Paul Desmond Wallace, seeking declaratory relief for contraventions of the Fair Work Act 2009 (Cth). The dispute centred around the failure to comply with obligations under sections 716(5) and 550(1) of the Act, specifically concerning the non-payment of accrued annual leave and personal leave entitlements of a former employee. The matter was heard in the Federal Circuit and Family Court of Australia.

The primary legal issues before the court were whether the First Respondent, Polyfone Telecom Pty Ltd, had contravened the Fair Work Act by failing to comply with the statutory compliance notice and whether the Second Respondent, Mr Paul Desmond Wallace, was involved in this contravention under section 550(1) of the Act. Furthermore, the court had to determine whether it was appropriate to grant the declaratory relief sought by the FWO.

In reaching its decision, the court considered the evidence provided by the FWO, which was not disputed. The FWO demonstrated that it had the statutory authority to bring these proceedings and that the First Respondent had indeed contravened the Act by not paying the former employee's accrued annual leave and personal leave entitlements. Additionally, the court found that Mr Wallace, as the director and majority shareholder, was involved in the contravention as he was responsible for the overall operation and management of the First Respondent. The court concluded that the declaration sought was appropriate given the contraventions identified.

The court granted the declaratory relief sought by the FWO, finding that both the First and Second Respondents had contravened the Fair Work Act. The question of any penalty to be imposed was to be determined separately.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

It falls then to consider the material before the Court as to whether there was a contravention and it is appropriate to make the declaration sought.THE EVIDENCE The Court received evidence of the following, which ultimately was not disputed, and constitutes findings I have made. The FWO is and was at all material times:(a)a statutory appointee of the Commonwealth appointed by the Governor-General by written instrument pursuant to s.687(1) of the Act;(b)a Fair Work Inspector pursuant to s.701 of the Act; and(c)a person with standing to bring these proceedings and to apply for orders for contraventions of civil remedy provisions pursuant to s.539(2) of the Act. The First Respondent, Polyfone Telecom Pty Ltd (ACN 109 390 490) (in liquidation), at all material times:(a)was a company incorporated under the Corporations Act 2001 (Cth) and registered since 4 June 2004;(b)was a “national system employer” within the meaning of s.14 of the Act and required to comply with the Act in respect of its employees;(c)was the trustee of the Polyfone Telecom Trust ABN 53 796 096 629, which operated a business that sold wholesale internet and VOIP services to schools and businesses (Business); and(d)from at least 1 December 2014 to 15 October 2019, was an associated entity of Macquarie Technology Group International Pty Ltd ACN 123 183 451 (since deregistered) (MTGI) within the meaning of s.50AAA(7) of the Corporations Act 2001 (Cth). The Second Respondent, a Mr Paul Desmond Wallace, at all relevant times:(a)is and was a natural person capable of being sued;(b)was the sole director and secretary and the majority shareholder of the First Respondent from 4 June 2004;(c)was the sole director of MTGI from 18 December 2006 to 15 October 2019;(d)was the sole shareholder of MTGI from 18 December 2006 to 10 May 2020;(e)is a person who was responsible for:(i)the overall operation, management and control of the First Respondent; and(ii)ensuring the First Respondent complied with its legal obligations under the Act; and(f)is and was a person whose conduct (engaged in on behalf of the First Respondent and within the scope of his actual or apparent authority) is taken to be that of the First Respondent under s.793(1) of the Act. On or about 25 November 2020, the FWO commenced an investigation into the First Respondent in respect of a former employee of the First Respondent. The investigator, Fair Work Inspector (FWO Inspector) O’Leary, was at all relevant times appointed under s.700 of the Act. On 6 January 2021, FWO Inspector O’Leary prepared a decision record which reflected that he had formed a belief that:a.from 1 December 2014 to 4 September 2020, the First Respondent employed Mr Ian Kerr (Employee) to work at the Business on a full-time basis;b.the Second Respondent was a director and shareholder of the First Respondent;c.between 20 April 2009 and 30 November 2014, the Employee was employed by Macquarie Technology Group International Pty Ltd (MTGI) on a full-time basis;d.MTGI had been deregistered at the date of the investigation, but the Second Respondent had been a director and shareholder of MTGI;e.the Employee’s accrued annual leave entitlements transferred from MTGI to the First Respondent on or around 1 December 2014;f.MTGI had previously been the subject of litigation by the Applicant;g.the Fair Work Act 2009 (Cth) (FW Act) and the Clerks – Private Sector Award 2020 (Clerks Award), a modern award under the FW Act, covered and applied to the First Respondent in respect of the employment of the Employee;h.at the time the Employee’s employment ended on 4 September 2020, the Employee:a.had 600.19 hours of untaken accrued annual leave; andb.had not been paid any amount for 4 days of paid personal leave taken from 1 September 2020 to 4 September 2020;i.the First Respondent had not paid the Employee:a.any amount in respect of his entitlement to accrued and untaken annual leave on termination; andb.any amount in respect of his entitlement to paid personal leave for the period 1 September 2020 to 4 September 2020;j.for the reasons above, the First Respondent contravened:a.section 99 of the FW Act and clause 33 of the Award; andb.section 90(2) of the FW Act and clause 32 of the Award.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Accordingly, the First Respondent had not complied with the statutory compliance notice by 22 March 2021 and had since partially (but not entirely) complied with the statutory compliance notice. CONSIDERATION Pursuant to s.190 of the Federal Circuit and Family Court of Australia Act 2021 (Cth), the overarching purpose of the civil practice and procedure provisions is to facilitate the just resolution of disputes according to law and as quickly, inexpensively and efficiently as possible. That overarching purpose includes the objectives of just determination of all proceedings before this Court, the efficient use of the judicial and administrative resources available, the efficient disposal of this Court’s overall caseload, disposal of all proceedings in a timely manner and resolution of disputes at a cost that is proportionate to the importance and complexity of the matters in dispute. It may be appropriate to dispose of a matter by summary judgment pursuant to r.13.10 of the Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) (GFL Rules) where, in a proceeding:(a)there is evidence of the facts on which the claim or part is based; and (b)there is evidence given by a party or some responsible person that the opposing party has no answer to the claim or part of the claim or the Court is satisfied that the opposing party has no reasonable prospect of successfully defending the claim or part of the claim. Sections 716(5) and 550(1) of the Act are civil remedy provisions. Section 716(5) provides (and at all relevant times provided):Compliance notices…Person must not fail to comply with notice(5) A person must not fail to comply with a notice given under this section.Note: This subsection is a civil remedy provision (see Part 4-1). Section 550 provides (and at all relevant times provided):Involvement in contravention treated in same way as actual contravention(1)A person who is involved in a contravention of a civil remedy provision is taken to have contravened that provision.Note:If a person (the involved person ) is taken under this subsection to have contravened a civil remedy provision, the involved person's contravention may be a serious contravention (see subsection 557A(5A)). Serious contraventions attract higher maximum penalties (see subsection 539(2)).(2)A person is involved in a contravention of a civil remedy provision if, and only if, the person:(a) has aided, abetted, counselled or procured the contravention; or(b)has induced the contravention, whether by threats or promises or otherwise; or(c)has been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to the contravention; or(d) has conspired with others to effect the contravention. A fair work inspector may apply to this Court for orders in relation to contraventions of ss.716(5) and 550(1): s.539(2). The Court may make any order it considers appropriate where satisfied that a person has contravened a civil remedy provision: s.545(2). The Court may also make a pecuniary penalty order for such contravention: s.546.