Fair Work Ombudsman v The Palcon Group Pty Ltd - [2009] FMCA 974

FEDERAL MAGISTRATES COURT OF AUSTRALIA

FAIR WORK OMBUDSMAN v THE PALCON GROUP PTY LTD

[2009] FMCA 974

INDUSTRIAL LAW – Pre-reform AWAs – breach – civil penalty – consideration of matters relevant to penalty.

Workplace Relations Act 1996, ss.167, 717, 718, 719, cl.1 of sch.7, cl.20(d) of sch.7
Workplace Relations Amendment (Work Choices) Act 2005
Workplace Relations (Transition to Forward with Fairness) Act 2008
Fair Work (Transitional Provisions & Consequential Amendments) Act 2009, item 2 of sch.1, item 11 of sch.2, item 12 of sch.18, item 13 of sch.18
Fair Work Act 2009, ss.682, 701
Crimes Act 1914, s.4AA

Kelly v Fitzpatrick (2007) 166 IR 14
Mason v Harrington Corporation Pty Limited [2007] FMCA 7
A&L Silvestri Pty Limited v Construction, Forestry, Mining & Energy Union [2008] FCA 466
Ponzio v B&P Caelli Constructions Pty Ltd (2007) 158 FCR 543
Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith (2008) 246 ALR 35

Applicant:

FAIR WORK OMBUDSMAN

Respondent:

THE PALCON GROUP PTY LTD
ACN 103 799 677

File Number:

PEG 103 of 2009

Judgment of:

Cameron FM

Hearing date:

9 September 2009

Date of Last Submission:

9 September 2009

Delivered at:

Sydney (by audio-link to Perth)

Delivered on:

8 October 2009

REPRESENTATION

Counsel for the Applicant:

Mr N. Ellery

Solicitors for the Applicant:

Corrs Chambers Westgarth

Counsel for the Respondent:

Mr D.S. Ellis

Solicitors for the Respondent:

Karp Steedman Ross-Adjie

ORDERS

THE COURT DECLARES THAT:

In contravention of clause 11 of the Australian Workplace Agreement between the respondent and Glenn Gordon Impson, and the undertaking to which that agreement was subject, the respondent failed to pay the totality of the production bonus due to the said Glenn Gordon Impson during the period of his employment with the respondent from 14 February 2005 to 19 February 2007.
In contravention of clause 11 of the Australian Workplace Agreement made between the respondent and Geoffrey Norris Shaddick, the respondent failed to pay the totality of the production bonus due to the said Geoffrey Norris Shaddick during the period of his employment with the respondent from 15 August 2005 to 9 June 2006.

THE COURT ORDERS THAT:

The respondent pay a pecuniary penalty of $22,500 for breaches of s.719(1) of the Workplace Relations Act 1996 in respect of its Australian Workplace Agreement with Glenn Gordon Impson and in respect of its Australian Workplace Agreement with Geoffrey Norris Shaddick.
The respondent pay the penalty to the Commonwealth.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
PERTH

PEG 103 of 2009

FAIR WORK OMBUDSMAN

Applicant

And

THE PALCON GROUP PTY LTD ACN 103 799 677

Respondent

REASONS FOR JUDGMENT

Introduction

In these proceedings the Fair Work Ombudsman seeks the imposition of pecuniary penalties under s.719 of the Workplace Relations Act 1996 (“WRA”) in respect of admitted breaches by the respondent of provisions of Australian workplace agreements (“AWAs”) made by it and two of its former employees.
For the reasons which follow, the respondent will be ordered to pay a pecuniary penalty of $22,500.

Statutory…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2009] FMCA 974
Decision Date: 8 October 2009

CaseChat Overview and Summary

The Fair Work Ombudsman sought a declaration and pecuniary penalty against The Palcon Group Pty Ltd, alleging that it had failed to pay production bonuses to two employees, Glenn Gordon Impson and Geoffrey Norris Shaddick, as stipulated in their Australian Workplace Agreements. The matter was heard in the Federal Circuit and Family Court of Australia. The primary legal issue the court had to address was whether the respondent had contravened the terms of the agreements by not paying the bonuses owed to the employees. Specifically, the court needed to determine if the bonuses specified in clause 11 of the agreements were indeed due and if the respondent had failed to make the full payments as required.

The court examined the terms of the Australian Workplace Agreements and the obligations of the parties under them. It found that the agreements clearly stipulated the conditions for the payment of production bonuses, and the respondent had failed to fulfil these obligations. The court noted that the agreements were legally binding, and the failure to pay the bonuses constituted a breach of these agreements. The court also highlighted that the respondent had not provided any legitimate justification for not making the payments as required. Consequently, the court held that the respondent had contravened the agreements and failed to pay the bonuses due to the employees.

In light of the findings, the court made several declarations and orders. It declared that the respondent had failed to pay the production bonuses to Glenn Gordon Impson and Geoffrey Norris Shaddick as required by their respective Australian Workplace Agreements. Furthermore, the court ordered the respondent to pay a pecuniary penalty of $22,500 for the breaches of section 719(1) of the Workplace Relations Act 1996. The penalty was to be paid to the Commonwealth. This decision underscored the importance of adhering to the terms of workplace agreements and the consequences of failing to do so.

Orders

Orders of the court

THE COURT DECLARES THAT:

In contravention of clause 11 of the Australian Workplace Agreement between the respondent and Glenn Gordon Impson, and the undertaking to which that agreement was subject, the respondent failed to pay the totality of the production bonus due to the said Glenn Gordon Impson during the period of his employment with the respondent from 14 February 2005 to 19 February 2007.

In contravention of clause 11 of the Australian Workplace Agreement made between the respondent and Geoffrey Norris Shaddick, the respondent failed to pay the totality of the production bonus due to the said Geoffrey Norris Shaddick during the period of his employment with the respondent from 15 August 2005 to 9 June 2006.

THE COURT ORDERS THAT:

The respondent pay a pecuniary penalty of $22,500 for breaches of s.719(1) of the Workplace Relations Act 1996 in respect of its Australian Workplace Agreement with Glenn Gordon Impson and in respect of its Australian Workplace Agreement with Geoffrey Norris Shaddick.

The respondent pay the penalty to the Commonwealth.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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