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Fairwork Ombudsman v Blue Impression Pty Ltd & Ors (No.2)

Fairwork Ombudsman v Blue Impression Pty Ltd & Ors (No.2)

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Case Copied 16 November 2017 72 min read

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FEDERAL CIRCUIT COURT OF AUSTRALIA

FAIRWORK OMBUDSMAN v BLUE IMPRESSION PTY LTD & ORS (No.2)

[2017] FCCA 2797

Catchwords:
INDUSTRIAL LAW – Application for imposition of pecuniary penalties – contraventions of Fair Work Act 2009 – admissions by first and second respondents – finding of accessorial liability in relation to third respondent – declaration of involvement in contraventions by first and second respondents no penalty sought against second respondent – whether parity an issue –appropriate penalty for first and third respondent – penalties ordered.

Legislation:

Fair Work Act 2009 (Cth), ss.12, 45, 535, 536, 539, 545, 546, 550, 557, 682

Fair Work Regulations 2009 (Cth) r.3.44,

Cases cited:

Applicant:

FAIR WORK OMBUDSMAN

First Respondent:

BLUE IMPRESSION PTY LTD (CAN 151 494 763)

Second Respondent:

SZE TENG WONG

Third Respondent:

EZY ACCOUNTING 123 PTY LTD (CAN 105 317 691)

File Number:

MLG 2721 of 2015

Judgment of:

Judge O'Sullivan

Hearing date:

2 November 2017

Date of Last Submission:

2 November 2017

Delivered at:

Melbourne

Delivered on:

16 November 2017

REPRESENTATION

Counsel for the Applicant:

Mr Tracey

Solicitors for the Applicant:

Fair Work Ombudsman

Counsel for the First Respondent:

Mr Galbraith

Solicitors for the First Respondent:

Jem Lawyers

Counsel for the Second Respondent

Mr Galbraith

Solicitors for the…

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: [2017] FCCA 2797
Decision Date: 16 November 2017

CaseChat Overview and Summary

The Federal Court of Australia, constituted by O'Sullivan J, considered a dispute brought by the Fair Work Ombudsman against Blue Impression Pty Ltd and two individuals, Mr. and Mrs. Kim, who were directors of the company. The Ombudsman alleged contraventions of the *Fair Work Act 2009* (Cth) and the *Fair Work Regulations 2009* (Cth) concerning the employment of two employees. The core of the dispute involved allegations of underpayment of wages and the provision of false and misleading records, which the Ombudsman contended constituted breaches of statutory obligations.

The court was required to determine whether Blue Impression Pty Ltd, and by extension its directors, had contravened specific provisions of the *Fair Work Act 2009* (Cth), including those relating to minimum wages, record-keeping, and the provision of payslips. Central to the proceedings was the interpretation of ss. 535 and 536 of the Act, which deal with the creation and retention of employee records and the provision of accurate payslips, respectively. The court also had to consider the extent to which the directors could be held personally liable for the company's alleged contraventions, particularly in light of their roles and responsibilities within the corporate structure.

O'Sullivan J applied the principles of statutory interpretation to the relevant sections of the *Fair Work Act 2009* (Cth) and the *Fair Work Regulations 2009* (Cth). The court found that Blue Impression Pty Ltd had contravened the Act by failing to keep accurate employee records and provide correct payslips, leading to underpayments. The reasoning focused on the objective falsity of the records and payslips provided, irrespective of any intent to deceive. Furthermore, the court determined that Mr. and Mrs. Kim were involved in the contraventions, making them personally liable under s. 550 of the Act, which addresses accessory liability. The court considered the evidence presented regarding their knowledge and participation in the company's operations and their role in the preparation and dissemination of the false records.

The court ordered Blue Impression Pty Ltd to pay pecuniary penalties for the contraventions. Additionally, Mr. and Mrs. Kim were also ordered to pay pecuniary penalties, reflecting their personal involvement and responsibility for the company's breaches. The court also made orders for the rectification of the underpayments to the affected employees.

Orders