Griffiths v Hanselmann
[2019] FCCA 710
•21 March 2019
FEDERAL CIRCUIT COURT OF AUSTRALIA
| GRIFFITHS v HANSELMANN | [2019] FCCA 710 |
| Catchwords: INDUSTRIAL LAW – Application made pursuant to the Fair Work Act 2009 (Cth) – contraventions found – orders made for payment – submissions on appropriate calculation. |
| Legislation: Fair Work Act 2009, ss.545, 546 |
| Cases cited: Griffiths v Hanselmann [2018] FCCA 1374 |
| Applicant: | CHRISTOPHER EDWARD GRIFFITHS |
| Respondent: | RUDOLPH HANSELMANN |
| File Number: | SYG 2522 of 2016 |
| Judgment of: | Judge Nicholls |
| Hearing date: | 21 February 2019 |
| Date of Last Submission: | 21 February 2019 |
| Delivered at: | Sydney |
| Delivered on: | 21 March 2019 |
REPRESENTATION
| Counsel for the Applicant | Ms L. Andelman |
| Solicitors for the Applicant: | Legal Aid NSW |
| Respondent: | In person |
ORDERS
Pursuant to s.545(2)(b) of the Fair Work Act 2009 (Cth) (“the Act”) the respondent pay the applicant on or before 20 May 2019 the following sums for the contraventions referred to above:
(a)failing to pay wages pursuant to clause 24.1 of the Manufacturing and Associated Industries and Occupations Award 2010 (Modern Award) as C14 Engineering/Manufacturing Employee Level 1 in the sum of $5,872.84.
(b)failing to make superannuation contributions pursuant to cl.35 of the Modern Award in the sum of $8,588.74.
(c)failing to pay of notice of termination pursuant to s.117 of the Act of five weeks in the sum of $3,110.30.
(d)failing to pay accrued annual leave on termination pursuant to s.90 of the Act in the sum of $23,265.04.
(e)failing to pay annual leave loading pursuant to s.90 of the Act in the sum of $4,071.38.
Pursuant to s.12 of the Long Service Leave Act 1955 (NSW) the respondent pay the applicant the sum of $8,626.11 on or before 20 May 2019.
Pursuant to s.76 of the Federal Circuit Court Act 1999 (Cth), interest from 20 June 2014 (date of termination of employment) up to judgment on the sum of $67,034.66 in the amount of $13,500.25 on or before 20 May 2019.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
SYG 2522 of 2016
| CHRISTOPHER EDWARD GRIFFITHS |
Applicant
And
| RUDOLPH HANSELMANN |
Respondent
REASONS FOR JUDGMENT
On 1 June 2018, judgment was handed down in Griffiths v Hanselmann [2018] FCCA 1374 (“Griffiths v Hanselmann (No 1)”). I made the following declarations and orders:
“THE COURT DECLARES THAT:
(1) The respondent contravened s.45 of the Fair Work Act 2009 (Cth) by failing to pay the applicant wages pursuant to cl.24.1 of the Manufacturing and Associated Industries and Occupations Award 2010 C14 Engineering/Manufacturing Employee Level I.
(2) The respondent contravened s.45 of the Fair Work Act 2009 (Cth) by failing to make superannuation contributions on behalf of the applicant in the years ending June 2012, 2013 and 2014 pursuant to cl.35 of the Manufacturing and Associated Industries and Occupations Award 2010.
(3) The respondent contravened s.44 of the Fair Work Act 2009 (Cth) by failing to provide the applicant with written notice of termination pursuant to s.117(1) of the Fair Work Act 2009 (Cth).
(4) The respondent contravened s.44 of the Fair Work Act 2009 (Cth) by failing to make a payment in lieu of notice of termination to the applicant pursuant to s.117(3) of the Fair Work Act 2009 (Cth) of five weeks.
(5) The respondent contravened s.44 of the Fair Work Act 2009 (Cth) by failing to pay the applicant accrued annual leave for the period 1 January 2001 to the date of termination, on termination, pursuant to s.90(2) of the Fair Work Act 2009 (Cth).
(6) The respondent contravened s.44 of the Fair Work Act 2009 (Cth) by failing to pay the applicant annual leave loading for the period 1 January 2001 to the date of termination, on termination, pursuant to s.90(2) of the Fair Work Act 2009 (Cth) and cl.41.5 of the Manufacturing and Associated Industries and Occupations Award 2010.
(7) The respondent contravened s.4 of the Long Service Leave Act 1955 (NSW) by failing to pay the applicant long service leave.
THE COURT ORDERS THAT:
(1) Pursuant to s.545(2)(b) of the Fair Work Act 2009 (Cth) the respondent pay the applicant the following:
(a) Wages pursuant to cl.24.1 of the Manufacturing and Associated Industries and Occupations Award 2010 as C14 Engineering/Manufacturing Employee Level I.
(b) Superannuation contributions pursuant to cl.35 of the Manufacturing and Associate Industries and Occupations Award 2010 for the years ending June 2012, 2013 and 2014.
(c) A payment in lieu of notice of termination pursuant to s.117(3) of the Fair Work Act 2009 (Cth) of five weeks wages.
(d) Accrued annual leave pursuant to s.90(2) of the Fair Work Act 2009 (Cth).
(e) Annual leave loading pursuant to s.90(2) of the Fair Work Act 2009 (Cth) and cl.41.5 of the Manufacturing and Associated Industries and Occupations Award 2010.
(2) Pursuant to s.12 of the Long Service Leave Act 1955 (NSW) the respondent pay the applicant long service leave.
(3) Pursuant to s.76 of the Federal Circuit Court Act 1999 (Cth), interest from 20 June 2014 (the date of termination of employment) up to the date of judgment on the total sum.
(4) The parties provide written submissions, setting out the relevant calculations with respect to each of the orders.
(5) The applicant must file and serve written submissions on the calculations, as set out in order 4, on or before 8 June 2018.
(6) The respondent to file and serve any written submissions on the calculations, as set out in order 4, on or before 22 June 2018.
(7) The matter of penalties be set down for hearing on a date to be administratively advised to the parties.
(8) The applicant file and serve written submissions on the matter of penalties or before 14 days before the date of the hearing on penalties.
(9) The respondent file and serve written submissions in reply on or before 7 days before the date of the hearing on penalties.”
This judgment concerns the determination of the amount payable to Mr Griffiths pursuant to orders 1, 2, and 3. Pursuant to orders 4, 5, and 6, in particular, the parties were required to file and serve written submissions on the appropriate calculations of these amounts. Mr Griffiths filed written submissions on 8 June 2018, and amended further submissions on 14 February 2019. Mr Hanselmann filed written submissions on 22 June 2018.
Before the Court on 21 February 2019, Mr Griffiths was represented by counsel. Mr Hanselmann appeared on his own behalf.
Mr Hanselmann stated that he had only recently received Mr Griffiths’ amended submissions of 14 February 2019 and he was not in a position to comment on them. In this circumstance I gave Mr Hanselmann a further two weeks to file his written submissions in response. These are now before the Court.
This judgment is concerned with the calculations of the various amounts that Mr Hanselmann should pay to Mr Griffiths given the contraventions of the Fair Work Act 2009 (Cth) (“the Act”) and consequent declarations as set out in Griffiths v Hanselmann (No 1).
What was immediately apparent from Mr Hanselmann’s oral submissions before the Court is that he appeared unwilling, or unable, to accept that the contraventions under the Act alleged against him have already been considered and determined by the Court following a hearing of those matters. For example, Mr Hanselmann submitted that Mr Griffiths was not “underpaid”, he was “overpaid”.
Mr Hanselmann’s view, as expressed before the Court, is that Mr Griffiths was “handicapped” (to use Mr Hanselmann’s term) and he looked after him “from the beginning”.
As an example of this, he allowed Mr Griffiths to come to the factory at 5:00am or 6:00am to “beat the traffic” and to have breakfast, even though he only lived 10 minutes away. Mr Hanselmann submitted (although not in evidence before the Court) that he had been content for Mr Griffiths to use the factory for this personal purpose which did not help the business, and indeed, supplied him with “full lightings and all facility”.
None of this assists Mr Hanselmann in the calculations, which are the current focus in these proceedings. In any event, I subsequently understood from Mr Hanselmann that this argument was otherwise put primarily in support of the proposition that there should be “no penalty” in this case.
It may be that Mr Hanselmann saw some overlap between the payment of compensation to Mr Griffiths (pursuant to s.545(2)(b) of the Act) because of the contraventions, and the payment of pecuniary penalties pursuant to s.546(1).
In his submissions of 22 June 2018, Mr Hanselmann takes issue with some of Mr Griffiths’ calculations, as set out in his submissions of 8 June 2018. Mr Griffiths has presented a new set of calculations dated 14 February 2019 and in understanding Mr Griffiths’ position it is to these calculations to which the Court’s current consideration is directed.
In his latest written submissions Mr Hanselmann continues to seek to revisit matters already determined by the Court. For example, he submits that it was a “lie” that he had not paid holiday pay, holiday loading and “separation payment”. In short, in the circumstances, this does not assist Mr Hanselmann in relation to the issue currently under consideration. That is, the calculation of the amounts to be paid in relation to the contraventions found by the Court.
I should also note that in his written submissions, Mr Hanselmann states that Mr Griffiths’ counsel did not act in good faith.
Even as a lay person, Mr Hanselmann should know this is a serious allegation to make against counsel. Simply because Mr Hanselmann disagreed with what counsel submitted to the Court on 21 February 2019 is not a basis on which to allege a lack of good faith. In any event, counsel’s submissions on behalf of Mr Griffiths proceeded from the findings already made by the Court.
In his submissions Mr Hanselmann also argues that Mr Griffiths has made an “ambit claim”, built on “generality assumption and proceedings”. At best, this can be understood as arising from the different calculations provided by Mr Griffiths in his submissions of 8 June 2018 and then subsequently on 14 February 2019.
Mr Hanselmann is correct to say that there are differences in the calculations provided by Mr Griffiths as seen in his two sets of submissions.
For example, in the calculations of June 2018 Mr Griffiths calculated an amount payable of $6,134.15 for wages payable to him after applying the appropriate award classification (as found by the Court in Griffiths v Hanselmann (No 1) [2018] FCCA 1374. (See order (1)(a) of 1 June 2018). In his subsequent calculations of February 2019, Mr Griffiths calculates a sum of $5,872.84.
Similarly with superannuation contributions payable (Order 1(b)), accrued annual leave and leave loading (order 1(d) and (e)).
However all of these make “reductions” in the amounts sought by Mr Griffiths. It is difficult to see what is meant by the term “ambit claim” in these circumstances.
In any event, one of the reasons for requiring further submissions in this regard was to ensure that the amounts as assessed by the parties arose from the judgment (in Griffiths v Hanselmann (No 1) [2018] FCCA 1374), and the evidence on which the judgment was based, and further, were accurate in the calculations and reflected the Court’s findings. Mr Griffiths’ subsequent submissions fulfilled this expectation.
I make the following findings in relation to the contraventions pursuant to s.545(2)(b).
Wages (Pursuant to Order 1(a))
Mr Griffiths submitted that he is owed $5,872.84 in wages. His calculations are set out, ultimately, in his written submissions of 14 February 2019 as follows ([4] of his written submissions):
Financial Year Ending Gross earnings Hourly rate paid Correct Hourly rate for C14 Level 1 Correct Gross payment Difference, amount owed 30/06/2011 (commencing 16/9/2010) 29713 14.9965679 14.99 29719.8 30/06/2012 29650 14.964771 15.51 30647.76 997.76 30/06/2013 28954 14.61349 15.96 31536.96 2582.96 30/06/2014 30055 15 16.37 32347.12 2292.12 Total $5872.84
Mr Hanselmann submitted that Mr Griffiths is owed $2,941.40 in wages. His calculations are set out as an attachment to his written submissions as follows:
Financial year ending Hours worked and paid Hourly rate paid Hourly rate claimed by Applicant difference Correct Hourly rate for C 14 Claimed underpaid Actual underpaid 30/06/11 1824 $15.00 14.9965679 $0.00 $15.00 $6.80 $0.00 30/06/12 1824 $15.00 14.964771 $0.04 $15.00 1080.2732 Nil 30/06/13 1824 $15.00 14.61349 $0.51 $15.51 2667.8672 $930.24 30/06/14 1468 $15.00 $15.00 $1.37 $16.37 2379.2084 $2,011.16 11/06/14 $16.37 $15.00 $16.37 $0.00 Total amount owed to the Applicant $2,941.40
From their calculations, it appears that the parties agree that the appropriate hourly rate to be paid to Mr Griffiths is as a C14 employee under the relevant Award. The difference in their submissions appears to be the hourly rate actually paid to Mr Griffiths in respect of hours worked. The only relevant evidence is to be found in the payslips at Annexure “CG1” to Mr Griffiths’ affidavit of 15 September 2016. This shows rates for the financial year ending June 2014.
Mr Hanselmann submitted that Mr Griffiths’ calculations are based on the “incorrect” base rate as to what rate Mr Griffiths was actually paid for hours worked. However, he bases this on what he says is the “comparison” of the two rates in Mr Griffiths’ calculations of 8 June 2018. For current purposes I have proceeded on the calculations as set out in Mr Griffiths’ submissions of 14 February 2019.
What Mr Griffiths was paid (in terms of hourly rate) and the hours worked, from when the underpayment is to be calculated, is to be derived from MFI – A2, which is the only document before the Court as to what should be relevantly paid to Mr Griffiths. If Mr Hanselmann had other relevant evidence, noting that, after all, he was the employer, then this was not, or he was not able to, put this before the Court.
The Court can only proceed on the evidence provided. In the absence of any other evidence to the contrary, and on the evidence before the Court, I agree with Mr Griffiths on the hourly rate actually paid to him and hours worked. I therefore find that he is owed $5,872.84 in unpaid wages.
Superannuation (Pursuant to Order 1(b))
Mr Griffiths submitted that he is owed $8,588.74 in superannuation payments. His calculations were as follows ([5] of Mr Griffiths’ written submissions of 14 February 2019):
Financial Year Ending
Superannuation Guarantee rate
Income that should have
been paid to the
ApplicantSuperannuation payable
30/6/2012 9% 30 647.76 2758.30 30/6/2013 9% 31 536.96 2838.33 30/6/2014 9.25% 32 347.12 2992.11 Total $8588.74
Mr Hanselmann did not make any submissions in relation to superannuation. On the evidence that is before the Court, I accept Mr Griffiths’ submission that he is owed $8,588.74 in unpaid superannuation.
Payment in lieu of notice of termination (Pursuant to Order 1(c))
Mr Griffiths submitted that he is owed $3,110.30 for payment in lieu of notice of termination. This is calculated using the weekly rate of $622.06 multiplied by five (for five weeks’ notice) ([6] of Mr Griffiths’ written submissions of 14 February 2019).
Mr Hanselmann submitted that payment in lieu of notice of termination “does not apply as proper notice had been given” ([3] of Mr Hanselmann’s written submissions of 22 June 2018). This submission is contrary to the finding at [122] of Griffiths v Hanselmann (No 1) and the corresponding declaration.
I find that Mr Griffiths is owed a payment of $3,110.30 in lieu of notice of termination.
Accrued annual leave and annual leave loading (Pursuant to Orders 1(d) and 1(e))
Mr Griffiths submitted that he is owed $23,265.04 in accrued annual leave, and $4,071.38 in annual leave loading. His calculations were as follows ([7] of Mr Griffiths’ written submissions):
Calendar Year Ending Annual leave days owing 1/1/2002 16 1/1/2003 16 1/1/2004 16 1/1/2005 16 1/1/2006 16 1/1/2007 16 1/1/2008 16 1/1/2009 16 1/1/2010 16 1/1/2011 16 1/1/2012 16 1/1/2013 16 1/1/2014 -5 Total days 187 Total amount owing at $16.37 per hour, 7.6 hours per day $23265.04 Annual leave loading at 17.5% $4071.38
Mr Hanselmann submitted that annual leave had been paid to Mr Griffiths in relation to the period he was employed on a “permanent bas[is]” and that “previous to that time [Mr Griffiths] was employed as a casual employee”. Therefore, he was not entitled to annual leave at that time ([4] of Mr Hanselmann’s written submissions of 22 June 2018).
The finding at [96] of Griffiths v Hanselmann (No 1) was that Mr Griffith’s was a full time permanent employee from 1 January 2001. He is therefore entitled to annual leave and annual leave loading from that time.
The relevant declaration and finding was that Mr Griffiths was owed annual leave from when he was employed on a permanent basis, which was from 1 January 2001.
Mr Griffiths is therefore owed $23,265.04 in annual leave and $4071.38 in annual leave loading.
Long service leave (Pursuant to Order 2)
Mr Griffiths submitted that he is owed long service leave in the amount of $8,626.11. His calculations were set out in his written submissions as follows ([8] of Mr Griffiths’ written submissions of 14 February 2019):
Correct weekly rate Yearly accumulation 18 years 622.06 0.8
13.867 weeks$8626.11
Mr Hanselmann submitted that Mr Griffiths “has not had a uninterrupted employment to qualify [for long service leave]” ([5] of Mr Hanselmann’s written submissions of 22 June 2018). This submission is contrary to the finding at [132] of Griffiths v Hanselmann (No 1) and the relevant declaration.
I find that Mr Griffiths is entitled to receive $8,626.11 in long service leave.
Interest (Pursuant to Order 3)
Mr Griffiths calculated the interest payable as follows ([9] of Mr Griffiths’ written submissions):
Period
Pre-judgment interest rate
Interest payable on principal of $57773.75
20/6/14 to 30/6/2014 (using daily rate)
6.5
$102.88
1/7/14 to 31/12/14
6.5
1893.08
1/1/15 to 30/6/15
6.5
1862.21
1/7/15 to 31/12/15
6
1747.46
1/1/16 to 30/6/2016
6
1723.74
1/7/16 to 31/12/16
5.75
1670.07
1/1/17 to 30/06/17
5.5
1575.72
1/7/17 to 31/12/17
5.5
1601.83
1/1/18 to 1/6/18 (using daily rate)
5.5
1323.26
Total interest payable
$13500.25
Mr Hanselmann did not make any submissions regarding interest. I accept Mr Griffiths’ submission on the relevant pre-judgment interest rates. Mr Hanselmann is to pay Mr Griffiths $13,500.25 in interest.
At the hearing the parties also made submissions on penalties. It is not appropriate that the Court proceed to consider these submissions at this time without giving Mr Hanselmann the opportunity to consider the Court’s determination as to the amount payable (and its constituent parts) pursuant to s.545(2)(b) for the contraventions, and how these would be relevant to the assessment on penalties.
The parties were given the opportunity to make further submissions. In particular I note that I raised specific matters with Mr Griffiths at the hearing, in respect of which I required further submissions.
I propose to now make the orders, as derived from what is set out above, that pursuant to s.545(2)(b) Mr Hanselmann pay Mr Griffiths an amount of $67,034.66. This is calculated as follows:
Order 1(a): $5,872.84 +
Order 1(b): $8,588.74 +
Order 1(c): $3,110.30 +
Order 1(d): $23,265.04 +
Order 1(e): $4,071.38 +
Order 2: $8,626.11 +
Order 3: $13,500.25 +
TOTAL = $67,034.66
Before the Court on 21 February 2019, Mr Griffiths provided a set of “Proposed Orders”. I have used this document as the form of the orders to be made now:
1. Pursuant to section 545(2)(b) of the Fair Work Act 2009 (Cth) the respondent pay the applicant the following sums for the contraventions referred to above:
a. failing to pay wages pursuant to clause 24.1 of the Manufacturing and Associated Industries and Occupations Award 2010 (Modern Award) as C14 Engineering/Manufacturing Employee Level 1 in the sum of $5 872.84.
b. failing to make superannuation contributions pursuant to clause 35 of the Modern Award in the sum of $8 588.74.
c. failing to pay of notice of termination pursuant to section 117 of the FW Act of five weeks in the sum of $3 110.30.
d. failing to pay accrued annual leave on termination pursuant to section 90 of the FW Act in the sum of $23 265.04.
e. failing to pay annual leave loading pursuant to section 90 of the FW Act in the sum of $4 071.38.
2. Pursuant to section 12 of the Long Service Leave Act 1955 (NSW) the respondent pay the applicant the sum of $8 626.11.
3. Pursuant to section 76 of the Federal Circuit Court Act 1999 (Cth), interest from 20 June 2014 (date of termination of employment) up to judgement on the sum of $67 034.66 in the amount of $13 500.25.
Mr Griffiths has requested that I also make an order that this amount be paid within 28 days of the date of the making of these orders.
It is appropriate given the history of this case that the parties be given some certainty as to the period within which the payment must be made. The issue, however, is whether the time proposed by Mr Griffiths is reasonable in the circumstances.
Mr Hanselmann has made various statements during the course of these proceedings. These include that his business is no longer operating, he is a “pensioner”, is 80 years old, and the like. His evidence before the Court is that he is a “retired pensioner” (Mr Hanselmann’s affidavit of 8 May 2017) and that: “…the factory and office [the business in which he employed Mr Griffiths] has closed down on 30 June 2014.” (Mr Hanselmann’s affidavit of 8 May 2017). There was no evidence from Mr Griffiths to dispute this.
The amount in the order of over $67,000 is large. Mr Griffiths has not satisfactorily explained why 28 days is a reasonable period to impose on Mr Hanselmann in the circumstances of this case as outlined above.
I am not persuaded that 28 days, given the large amount to be paid by an individual, and who is now an aged pensioner, is reasonable. I will make the order sought, but give Mr Hanselmann a period of 60 days within which to make the payment.
Mr Griffiths proposed, and there did not appear to be any objection from Mr Hanselmann, that upon expiry of that period, and subject to any, yet further, submissions from the parties, that the Court proceed to consider penalties without holding any further hearings. I note both parties have taken the opportunity already to make submissions on this issue. I agree with this course.
Conclusion
I will make the orders as set out above as proposed in this judgment.
I certify that the preceding fifty-three (53) paragraphs are a true copy of the reasons for judgment of Judge Nicholls
Date: 21 March 2019
0