Fair Work Ombudsman v Tipene

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FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 2)

Fair Work Ombudsman v Tipene [2023] FedCFamC2G 296

File number(s): SYG 1693 of 2022
Judgment of: JUDGE D HUMPHREYS
Date of judgment: 21 April 2023
Catchwords: INDUSTRIAL LAW – Fair Work Act – Plumbing and Fire Sprinklers Award 2020 – default by respondent – matter determined on the papers – determination of pecuniary penalty.
Legislation:

Fair Work Act 2009 (Cth) ss 539, 546, 716

Federal Circuit and Family Court of Australia (Division 2) (General Federal law ) Rules 2021 (Cth)

Plumbing and Fire Sprinklers Award 2020   
Cases cited:

Australian Building and Construction Commissioner v Pattinson [2022] HCA 13

Australian Ophthalmic Supplies Pty Ltd v McAlary‑Smith (2008) 165 FCR 560

Canturi v Sita Coaches Pty Ltd (2002) 116 FCR 276

Fair Work Ombudsman v Nobrace Centre Pty Ltd  (in Liquidation) [2019] FCCA 2979

Fair Work Ombudsman v NSH North Pty Ltd t/as New Shanghai Charlestown [2017] FCA 1301

Fair Work Ombudsman v Tipene [2022] FedCFamC2G 853

Mason v Harrington Corporation Pty Ltd [2007] FMCA 7

Seven Network (Operations) Pty Ltd v Communications, Electrical, Electronic, Energy Information, Postal Plumbing and Allied Services Union of Australia (2001) 110 IR 372

Division: Division 2 General Federal Law
Number of paragraphs: 29
Date of last submission/s: 30 March 2023
Date of hearing: In Chambers
Place: Parramatta
Solicitor for the Applicant: Mr Lodge of the Fair Work Ombudsman
Solicitor for the Respondent: No appearance by or on behalf of the Respondent

ORDERS

SYG 1693 of 2022

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

FAIR WORK OMBUDSMAN

Applicant
AND:

WINIATA TIPENE

Respondent

order made by:

JUDGE D HUMPHREYS

DATE OF ORDER:

21 APRIL 2023

THE COURT ORDERS THAT:

1.Pursuant to s 546 of the Fair Work Act 2009 (Cth), the Respondent pay a pecuniary penalty of $6,660.00 to the Commonwealth for the contravention declared in order 2 of the orders of 24 February 2023 to be payable within 28 days of the day of this order.

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 D HUMPHREYS

INTRODUCTION

  1. On 21 November 2022, the Fair Work Ombudsman (FWO) filed a Statement of Claim alleging that the Respondent Mr Wainata Tipine, breached s 716(5) of the Fair Work Act 2009 (Cth) (“the Act”) by failing to comply with a Compliance Notice issued on him.

  2. That Compliance Notice followed an investigation launched by the FWO after receiving information that a Mr Josh Jackson had been underpaid by Mr Tipene in breach of the Plumbing and Fire Sprinklers Award 2020.

  3. The Compliance Notice required…

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Details
Case
[2023] FedCFamC2G 296
Decision Date

CaseChat Overview and Summary

In the matter of Fair Work Ombudsman v Tipene, the Fair Work Ombudsman (FWO) sought penalties against Mr. Tipene for failing to comply with a Compliance Notice under the Fair Work Act 2009. This case before the Federal Circuit and Family Court of Australia involved a dispute over non-compliance with a Compliance Notice, which mandated specific financial obligations towards employees. Mr. Tipene, the respondent, did not file any submissions or evidence, and the matter was decided based on the material submitted by the FWO. The FWO presented affidavits and other documents to substantiate its claims against Mr. Tipene for non-compliance with the Compliance Notice and failure to make payments to employees as ordered by the Court. The legal issues centred around the determination of an appropriate penalty for Mr. Tipene's contravention of the Fair Work Act, particularly for his failure to comply with a Compliance Notice. The Court had to consider factors such as the nature of the contravention, the deliberateness of the breach, the impact on the employees, and the need for deterrence against future non-compliance. The Court also had to assess whether any penalty should be reduced for lack of contrition or corrective action by Mr. Tipene.

The Court exercised its discretion to impose a penalty under the Fair Work Act, guided by the principles articulated in Pattinson and other relevant case law. It took into account the seriousness and deliberateness of the breach, the financial impact on the employees, and the need for deterrence. The Court found that Mr. Tipene displayed a belligerent and obdurate attitude, with a complete disregard for his obligations under the Act and the authority of the Court. Given the circumstances and the lack of any mitigating factors presented by Mr. Tipene, the Court determined that the penalty should not be excessive but sufficient to achieve the objectives of deterrence and protection of workplace laws. After considering all the relevant factors, the Court imposed a penalty of $6,660.00 on Mr. Tipene, which was the maximum allowable under the Act for the contravention identified. This decision underscores the importance of compliance with workplace laws and the Court's role in enforcing these laws to protect employees' rights.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

Unsurprisingly, given the history of the matter, Mr Tipene has failed to file any submissions or evidence. Accordingly the matter is being determined on the material filed by the FWO in Chambers.EVIDENCE RELIED UPON The FWO relied upon the following evidence:a. Statement of Claim filed 21 November 2022.b. Affidavit of Megan Carter made on 3 February 2023; andc. Affidavit of Vanessa Camilleri made on 30 March 2023. The Court is satisfied that both before default judgement was made by the Court and following, the FWO has extensively tried to engage with Mr Tipene to resolve the matter. As at the date of this judgement no payment as required by the Court’s orders has been made to Mr Jackson.EARLIER COURT PROCEEDINGS The Court notes this is the second time that the FWO is found it necessary to take proceedings against Mr Tipene in relation to failing to comply with a Compliance Notice. In Fair Work Ombudsman v Tipene [2022] FedCFamC2G 853 the Court imposed a pecuniary penalty of $6300 on Mr Tipene together with orders for the payment of amounts in respect of underpayments to two employees. The Court has been advised that the orders made on 7 October 2022 at not been complied with in that no payments have been made to the underpaid employees and the pecuniary penalty remains outstanding. At paragraph 17 of that judgement the Court said as follows:Evidence has been given of a belligerent and obdurate attitude by the respondent. The Court is of the view that the respondent has displayed a complete disregard for his obligations under the Compliance Notice and is in serious and wilful disregard of his responsibilities under the Act, as towards the applicant as the regulator of Commonwealth workplace laws and the Court. The above, is equally applicable in the current proceedings.RELEVANT LAW IN RELATION TO PENALTY The Court has a broad discretion as to penalty. In Australian Building and Construction Commissioner v Pattinson [2022] HCA 13 (“Pattinson”) at [71] it is said that the Court should fix a penalty ‘it considers fairly and reasonably to be appropriate to protect the public interest from future contraventions of the Act’. Further at [10] and [12], the High Court stated that the penalty must not exceed what is ‘reasonably necessary to achieve the purpose of section 546: the deterrence of future contraventions of a like kind by the contravener and others’. In Fair Work Ombudsman v NSH North Pty Ltd t/as New Shanghai Charlestown [2017] FCA 1301 Bromwich J summarised how the discretion is to be approached at [36], as follows:1) Identify the separate contraventions, with each breach of each obligation being a separate contravention, and each breach of a term of the Award being a separate contravention. 2) Consider whether each separate contravention should be dealt with independently or with some degree of aggregation for those contraventions arising out of a course of conduct, noting that s 557 of the Act provides that two or more contraventions of a given civil remedy provision are to be taken to be a single contravention if committed by the same person and arising out of a course of conduct by that person. 3) Consider whether there should be further adjustment to ensure that, to the extent of any overlap between groups of separate aggregated contraventions, there is no double penalty imposed, and that the penalty is an appropriate response to what each respondent did.4) Consider the appropriate penalty in respect of each final individual group of contraventions, taken in isolation.5) Consider the overall penalties arrived at, including by reference to those which may be proposed by the FWO (as permitted by Commonwealth v Director, Fair Work Building Industry Inspectorate [2015] HCA 46; 258 CLR 482 (CFMEU Civil Penalties Case) at [64]) and what is proposed by the respondents, and apply the totality principle, to ensure that the penalties for each respondent are appropriate and proportionate to the conduct viewed as a whole, making such adjustments as are necessary: see Kelly v Fitzpatrick [2007] FCA 1080; 166 IR 14 at [30]; Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8; 165 FCR 560 at [23]. [71] and [102].

Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

Merkel J in Seven Network (Operations) Pty Ltd v Communications, Electrical, Electronic, Energy Information, Postal Plumbing and Allied Services Union of Australia (2001) 110 IR 372 set out some guiding considerations for the Court at 374:matters to be taken into account in determining the appropriate penalty include the cost of the contravention, deterrence, the flagrancy and deliberateness of the breach, the offender’s past record of behaviour and any contrition displayed by the offender. CONSIDERATION The current proceedings concern one contravention of s 716(5) of the Act. Pursuant to ss 539(2) and 546(2)(a) of the Act, the maximum penalty the Court may impose on the respondent for the contravention is $6,660.00. In terms of the nature, circumstances and deliberateness of the contravention, the underpayment took place in circumstances where the Compliance Notice gave the respondent an opportunity to rectify the contraventions and therefore be protected from civil remedy proceedings. It also occurred in a background where the respondent was on notice from as early as 30 April 2022 of the need to comply with the Compliance Notice and that it may lead to the imposition of civil penalties if not complied with. The Court is satisfied the failure to comply with a Compliance Notice demonstrates a serious and deliberate disregard for his obligations under the Act and the authority of the applicant as a regulator of Commonwealth workplace laws. In terms of the nature and extent of the loss, Mr Jackson has been directly impacted by the respondent’s failure to comply with a Compliance Notice. At a time of significant inflation, any underpayment to a worker will be keenly felt and have most likely significant impact on the worker. The non-compliance has required the FWO to institute proceedings in this Court and has taken up valuable Court time in circumstances where Mr Tipene has ignored the Court and its authority. In terms of the size and financial circumstances of the respondent, the Court notes that he has not adduced any evidence that establishes the reason he did not comply with the Compliance Notice either due to financial hardship or otherwise. Further, the respondent has expressed on multiple occasions to the FWO an intention to make payments to rectify the non-compliance but is not done so. Further, it is well established the size and financial circumstances of an employer do not exculpate breaches of workplace laws and that the capacity to pay a penalty will be of less relevance in the objective of general deterrence. In terms of cooperation, contrition and corrective action, the Court notes the respondent has not displayed one iota of contrition or remorse. By failing to engage with the Court has put the respondent to considerable further additional time and expense in having to obtain default judgement. The Court is of the view that no discount on any appropriate penalty can be given in respect of contrition and corrective action. In terms of general deterrence, the penalty imposed must aim to deter “future contraventions of a like kind… by others”: Pattinson at [10]. There should be some reasonable relationship to the maximum penalty such that the penalty imposed does not exceed what is reasonably necessary. Thus any penalty imposed must be sufficient to deter others so that penalties are not regarded as “an acceptable cost of doing business”: Pattinson at [17].