Fair Work Ombudsman v Sushi Bay Pty Ltd (in liq) (No 2)

In the case of Fair Work Ombudsman v Sushi Bay Pty Ltd (No 2), the Federal Circuit and Family Court of Australia considered whether the companies within the Sushi Bay Group had contravened various provisions of the Fair Work Act 2009 and Fair Work Regulations 2009. The dispute involved allegations of wage underpayments, improper classification of employees, and record-keeping failures, among other claims. The key issue before the court was whether the companies had contravened specific sections of the Fair Work Act and whether these contraventions constituted serious contraventions warranting civil penalties.

The court found that the companies within the Sushi Bay Group had indeed contravened the relevant provisions of the Fair Work Act. The companies operated a centralised payroll system that involved paying certain employees award rates for specified hours while paying below-award cash rates for additional hours. This practice was found to be a breach of section 45 of the FW Act, which mandates the payment of the correct award rates. Furthermore, the court determined that the companies failed to pay overtime, public holiday, and weekend penalty rates, thereby violating section 45 again. Additionally, employees on temporary work visas were required to reimburse some of their earnings, which contravened section 323 of the FW Act. The court also held that the companies contravened section 535(4) of the FW Act and regulation 3.44 of the FW Regulations by knowingly maintaining false or misleading payroll records. The companies' failure to disclose cash payments and understate hours worked when providing documents to Fair Work inspectors further substantiated the contravention of section 718A of the FW Act.

The court concluded that the contraventions identified were serious, as they occurred after 15 September 2017, and that the companies had the requisite knowledge. The contravening conduct was found to be part of a systematic pattern of conduct. Consequently, the court ruled in favour of the Ombudsman on all counts, except for the classification of one employee. The court ordered the Fair Work Ombudsman to file and serve a document setting out the declarations and orders reflecting the reasons for judgment. The only active respondent, Ms Shin, was given an opportunity to respond to the proposed declarations and orders. The matter was scheduled for case management to address the remaining questions.