Fair Work Ombudsman v Sakuraya Warrigal Pty Ltd

The Fair Work Ombudsman (FWO) brought proceedings against Sakuraya Warrigal Pty Ltd (the Company) and its sole director, Mr. David John Smith, alleging contraventions of the *Fair Work Act 2009* (Cth) (the Act). The dispute concerned the Company's failure to pay two employees their minimum entitlements, specifically their minimum hourly rates, overtime, and annual leave entitlements, over a period of approximately 18 months. The FWO sought pecuniary penalties against both the Company and Mr. Smith, as well as orders for the repayment of the outstanding entitlements.

The primary legal issue before the Federal Circuit and Family Court of Australia was whether the Company, through the actions of Mr. Smith, had contravened various provisions of the Act by failing to pay the correct minimum wages and entitlements to its employees. A further issue was whether Mr. Smith was personally liable for these contraventions, given his role as the sole director and his alleged involvement in the decision-making process that led to the underpayments. The court was required to determine the extent of Mr. Smith's knowledge and participation in the Company's failure to meet its statutory obligations.

Judge Vasta found that the Company had indeed contravened the Act by failing to pay the minimum hourly rates, overtime, and annual leave entitlements to the two employees. The court determined that Mr. Smith was personally liable for these contraventions, applying the principle of accessory liability under section 550 of the Act. His Honour found that Mr. Smith was knowingly concerned in the Company's contraventions, having been aware of the employees' entitlements and the Company's failure to meet them. The court considered the deliberate nature of the underpayments and the lack of any genuine attempt by the Company or Mr. Smith to rectify the situation until proceedings were commenced.

The court ordered the Company to pay pecuniary penalties totalling $20,000 and Mr. Smith to pay pecuniary penalties totalling $4,000. Additionally, the court ordered the Company to rectify the underpayments, which amounted to $10,988.90, plus superannuation.