Ianni v Platinum Estore Pty Limited (No 3)
[2022] FedCFamC2G 994
Federal Circuit and Family Court of Australia
(DIVISION 2)
Ianni v Platinum Estore Pty Limited (No 3) [2022] FedCFamC2G 994
File number(s): SYG 2935 of 2020 Judgment of: JUDGE HUMPHREYS Date of judgment: 28 November 2022 Catchwords: INDUSTRIAL LAW- Fair Work Act – determination of pecuniary penalty. Legislation: Crimes Act 1914 (Cth) s 4AA
Fair Work Act 2009 (Cth) ss 45, 90, 323, 324, 536, 547, 550, 546
Cases cited: 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 Zillion Zenith International and Anor [2014] FCCA 433
Ianni v Platinum eStore Pty Limited [2022] FedCFamG2 611
Mason v Harrington Corporation Pty Ltd [2007] FMCA 7
Mornington Inn Pty Ltd v Jordan (2008) 168 FCR 383
Seven Network (Operations) 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: 65 Date of last submission/s: 14 November 2022 Date of hearing: 14 November 2022 Place: Parramatta Solicitor for the Applicants: Mr Clarke of Marrickville Legal Centre Solicitor for the Respondents: Self-Represented
Table of Corrections 29 November 2022 In order 1, the value has been amended to $35,500.00. ORDERS
SYG 2935 of 2020 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: ROCCO IANNI
First Applicant
ISABELLA IANNI
Second Applicant
MADELEINE SNOXALL
Third Applicant
AND: PLATINUM ESTORE PTY LIMITED (ACN 168 825 321)
First Respondent
AZADEH ASHRAFINA
Second Respondent
order made by:
JUDGE HUMPHREYS
DATE OF ORDER:
28 NOVEMBER 2022
THE COURT ORDERS THAT:
1.Pursuant to s 546(3)(c) of the Fair Work Act 2009 (Cth) (“the Act”), the First Respondent is to pay a pecuniary penalty of $35,500.00 to the applicants.
2.Pursuant to s 546(3)(c) of the Act, the Second Respondent is to pay a pecuniary penalty of $7,350.00 to the applicants.
3.The pecuniary penalties set out in 1. and 2. above are to be paid within 28 days of the date of these orders.
4.The first and second respondent jointly and severally pay the First Applicant the sum of $265.63 in respect of interest payable on the amounts ordered to be paid to him pursuant to s 547 of the Act.
5.The first and second respondents jointly and severally pay the Second Applicant the sum of $369.27 in respect of interest payable on the amounts ordered to be paid to her pursuant to s 547 of the Act.
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 HUMPHREYS
Introduction
This judgement deals with the appropriate pecuniary penalties to be imposed in respect of breaches of the Fair Work Act 2009 (Cth) (“the Act”) found to have been committed by the first and second respondents: (see; Ianni v Platinum eStore Pty Ltd and Anor [2022] FedCFamG2 611).
The breaches are as follows:
In relation to the First Applicant:
•Failed to pay accrued annual leave and annual leave loading contrary to s 90 of the Act;
•Failed to issue payments (i) and (ii) within 7 days of employment termination contrary to cl 18.4, 28 and 37 of the General Retail Industry Award 2010 (“the Award”) and contravening s 45 of the Act;
•Failed to pay the full amount for performed worked between 27 January 2020 to 9 February 2020 contrary to s 323 of the Act;
•Made unauthorised deductions contrary to s 324(1) of the Act;
•Failed to issue a payslip within one day of making a payment contrary to s 536 of the Act.
In relation to the Second Applicant:
•Failed to pay accrued annual leave and annual leave loading contrary to s 90 of the Act;
•Failed to issue payments (i) and (ii) within 7 days of employment termination contrary to cl 18.4, 28 and 37 of the Award and contravening s 45 of the Act;
•Failed to accrue annual leave on hours worked between 14 January 2019 and 25 February 2019 contrary to cl 11 of the Award and contravening s 45 of the Act;
•Failed to pay the full amount for performance worked between 27 January 2020 to 9 February 2020 contrary to s 323 of the Act;
•Failed to issue a payslip within one day of making a payment contrary to s 536 of the Act.
In relation to the Third Applicant:
•Failed to pay accrued annual leave and annual leave loading contrary to s 90 of the Act;
•Failed to issue payments (i) and (ii) within 7 days of employment termination contrary to cl 18.4, 28 and 37 of the Award and contravening s 45 of the Act;
•Failed to issue a payslip within one day of making a payment contrary to s 536 of the Act.
The Court notes that the liability of the second respondent arises out of her position as the sole Director and shareholder of the first respondent and accordingly is liable under s 550 of the Act on the basis of accessorial liability in that she was involved in the contravention.
Evidence was tendered to the Court by way of an Affidavit from the applicant’s solicitor, Mr William Clarke, that as of the date of the hearing, 14 November 2022, the applicants have not received any payments as ordered by the Court being the amounts found to still be payable by the respondents.
Interest Payable
The Court notes the parties have not been able to agree on the amount of interest payable in respect of the orders made set out above. The Court has been provided with a worksheet prepared by the applicants’ solicitor, Mr Clarke. The Court has perused this document and is satisfied that it represents an appropriate calculation for interest payable. In the absence of any material disputing these calculations from the respondents, the Court makes the following orders.
a. The first and second respondent jointly and severally pay the first applicant, Rocco Ianni, the sum of $265.63 in respect of interest payable on the amounts ordered to be paid to him pursuant to s 547 of the Act.
b. The first and second respondents jointly and severally pay the second applicant, Isabelle Ianni, the sum of $369.27 in respect of interest payable on the amounts ordered to be paid to her pursuant to s 547 of the Act.
No claim for interest was made in respect of the third applicant.
The Law relevant to fixing Pecuniary Penalties under the Act
By reference to s 4AA of the Crimes Act 1914 (Cth), the upper limit for penalties for each breach committed in 2019 and 2020 is 300 penalty units for the first respondent or a maximum of $63,000, and 60 penalty units or a maximum of $12,600 for the second respondent, based on a penalty unit of $210.
The Court has a broad discretion as to penalty. 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].
The purpose of a civil penalty is primarily, if not wholly, promoting the public interest in compliance with the laws that have been contravened, and it does not engage principles of retribution or rehabilitation: (see; Fair Work Ombudsman v Nobrace Centre Pty Ltd (in Liquidation) [2019] FCCA 2979 (“Nobrace”) per Kelly J at [65]). As these principles of retribution or rehabilitation are not involved in the determination of a civil penalty, this intensifies the focus of a civil penalty determination on issues of specific and general deterrence: (see; Nobrace at [66]).
The Act does not set out any mandatory criteria, inclusive or exclusive, that the Court must consider when determining whether to impose a penalty or the amount of any penalty: (see; Canturi v Sita Coaches Pty Ltd (2002) 116 FCR 276 at [88]). The choice of penalty must be guided by the “individual circumstances of a case, not by a line-by-line comparison with another case”: (see; Australian Ophthalmic Supplies Pty Ltd v McAlary‑Smith (2008) 165 FCR 560 at [12]). The process is an intuitive one by the Court and not an application of a scientific process: (see; Mornington Inn Pty Ltd v Jordan (2008) 168 FCR 383 at [60]‑[63]).
In Mason v Harrington Corporation Pty Ltd [2007] FMCA 7, Mobray FCM set out what is a now well accepted non-exclusive set of factors relevant in assessing a pecuniary penalty. They are as follows:
a) the nature and extent of the conduct which led to the breaches;
b) the circumstances in which the conduct took place;
c) the nature and extent of any loss sustained as a result of the breaches;
d) whether there has been similar previous conduct by the Respondents;
e) whether the breaches were properly distinct or arose out of one course of conduct;
f) the size of the business enterprise involved;
g) whether or not the breaches were deliberate;
h) whether senior management was involved in the breaches;
i) whether the party committing the breach had exhibited contrition;
j) whether the party committing the breach had taken corrective action;
k) whether the party committing the breach had cooperated with enforcement authorities;
l) the need to ensure compliance with minimum standards by provision of an effective means for the investigation and enforcement of employee entitlements; and
m) the need for specific and general deterrence.
Merkel J in Seven Network (Operations) 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.
Step one – Identifying the Individual Contraventions
The individual contraventions have been set out in the orders of the Court and are referred to above.
Step two – Should the contraventions be dealt with separately or aggregated together?
The applicants submitted that the breaches identified by the Court should be aggregated into five separate categories:
a) The failure to pay accrued annual leave and leave loading pursuant to section 90 of the Act to both the first and second applicants with;
b) The failure to pay accrued annual leave and leave loading pursuant to section 90 of the Act of the third applicant;
c) The unauthorised deduction of $2,353.52 from amounts due to the first applicant contrary to ss 323 and 324 of the Act;
d) The failure to accrue annual leave on hours worked by the second applicant between 14 January and 24 February contrary to the award in section 45 of the Act; and
e) The failure to issue payslips to the first and second applicants within one day of payment contrary to s 536 of the Act and belatedly issuing a payslip to the third applicant.
The respondents submitted that the contraventions identified should be grouped into two categories only, being the failures to pay amounts owing and the failure to issue payslips. In relation to the failure to pay, it was submitted this was the result of a single decision of the second respondent not to pay further amounts to the applicants.
In the Courts view, the failure to annual leave loading and accrued annual leave identified in items (a) and (b) above should be aggregated together, thus leaving 4 separate contraventions to be assessed in relation to penalty. The Court does not accept that a single decision not to pay further amounts of money to the applicants results in two breaches only as they were in relation to different entitlements.
Step three – Overlap between the Contraventions
The Court is satisfied however, that there is some overlap between categories a), b) and d) identified above and will mitigate the penalties imposed, unlike individual penalties, to take account of this consideration.
Step four – Set the individual penalties for each identified contraventions
In relation to the particular factors identified by Mowbray FCM, the Court finds as follows:
The nature and extent of the conduct which led to the contraventions
On behalf of the applicants, it was submitted that the Respondents did not concern themselves with the provisions of the relevant Award benefitting the applicants. While the respondents demanded the Applicant’s comply with ‘end of employment’ processes, such as returning uniforms and company property, they made no acknowledgement of the applicants’ rights to be paid within seven days, or attending to payment or the provision of payslips. The Award is clear that payment of all wages and entitlements is to be made within 7 days of employment ceasing. As at the date of the hearing, no applicant had been paid their annual leave loading.
On behalf of the respondents, it was submitted that the failure to pay entitlements was in circumstances where the respondents considered they had already made full payments. The failure to provide payslips was an administrative breach only.
Payslips provide the only mechanism by which employees are able to understand what they have been paid and how that has been calculated. Without payslips, employees are not able to know if they have received their proper entitlements. It is something far more than a mere administrative breach oversight. A failure to provide payslips has attracted significant penalties in the past.
While the respondents may have considered that they had made full payment, the Court has found they did not do so. Full payments for the funds found to be still outstanding have yet to be made and as a result the conduct continues. This is an aggravating matter in terms of penalty.
The circumstances in which the conduct took place
The Court has found that the first and second applicants abandoned their employment following an incident with the second respondent. It is submitted the first and second respondents took immediate steps to notify the second respondent of their entitlement to be paid wages and accrued annual leave entitlements. The second applicant was paid annual leave but not annual leave loading, some 4 months after her employment ending with the first respondent. The first applicant’s entitlements were in part acknowledged, but were offset by unauthorised deductions, partially remedied by a payment of $365 after 3 months and a more significant payment a month later. The amounts involved were relatively small to the size of the business.
The respondents submit that they were advised by the Fair Work Ombudsman that annual leave was not payable due to the applicants receiving better than Award rates and the assertion by the respondent that there had been overpayments to the applicants. In Court, the second respondent told the Court that the advice she had received was incorrect and the Fair Work Ombudsman had apologised for this incorrect advice. No evidence of this assertion was produced to the Court. In relation to the payslips, the respondents assert the delay was due to the payslips being given to the Fair Work Ombudsman prior to them being given to the respondents, noting payment had been made earlier.
First, in relation to the payslips, the respondents were under a clear obligation to provide payslips within 1 day of a payment being made. The Court does not accept that the involvement of the Fair Work Ombudsman somehow relieved the respondents of a clear obligation. The Court is of the view that the submission of the respondents seeking to blame the Fair Work Ombudsman is evidence of the second respondent, in particular, seeking to blame others for clear failures on her part as the sole Director of the first respondent. In the absence of any evidence of incorrect advice being provided by the Fair Work Ombudsman, the Court does not accept the excuse offered by the respondents.
The nature and extent of any loss or damage sustained as a result of the contraventions
On behalf of the applicants, it was submitted that they were, to the knowledge of the respondents, young people, not well off, engaged in full-time study, and in the case the third applicant, working in her first job. In any event, the withholding of these payments denied each of the applicant’s financial security between jobs.
The treatment of the third applicant was particularly unfair and she was left in ignorance until shortly before bringing these proceedings of the very existence of entitlement to accrued leave and loading. She would have never been paid otherwise.
On behalf the respondents, it was submitted the loss and damage were, respectfully and relatively, quite small. It was asserted that payslips were provided to the applicant soon after payment was issued in each circumstance.
The Court does not accept that the loss or damage to the applicants was small. These were young people working in what is a relatively low paid area. Whilst in monetary terms the amounts may be small, the significance of those amounts to the applicants was relatively large. The fact that payments were delayed, have not yet been fully made, and proper payslips were not issued within the prescribed time period, is a significant issue. The Court needs to send a clear message to employers that the non-payment of full entitlements to employees will not be tolerated and will attract financial penalties which will outweigh any perceived financial benefit to the employer.
Whether there has been similar previous conduct by the respondents
No material has been put to the Court by either party of previous breaches. In these circumstances, the respondents are entitled to be dealt with as first offenders with appropriate consideration of that status in relation to the overall penalties that will be imposed.
Whether the breaches were properly distinct or arose out of one course of conduct
This has been dealt with above in determining the appropriate groupings of the breaches that have been found. The Court is satisfied that there should be a grouping of the breaches which will result in a reduction of the overall penalties that might otherwise have been imposed.
The size of the business enterprise involved
On behalf of the applicants, it was submitted that technically, the first respondent is a small business. However, no evidence has been given of financial or other impediments resulting in an inability to manage the first respondent’s business. It was noted that the second respondent frequently raised the COVID-19 pandemic as an issue however, the contraventions occurred prior to the COVID-19 lockdowns.
On behalf of the respondents, it was submitted that the business employs fewer than five persons and has a sole Director. There is now only a single kiosk location in a shopping centre.
While the Court accepts that the first respondent is a small business and is prepared to accept that it employs now only fewer than five persons, no financial information has been provided as to the turnover of the business and/or its profitability and thus, capacity to pay any financial penalty. In any event, capacity to pay is not a relevant consideration fixing penalties. Penalties must be assessed at the appropriate level, bearing in mind the need for specific and general deterrence is a significant consideration in the fixing of overall penalties.
Whether or not the contraventions were deliberate
On behalf of the applicants, it was submitted that the 2019 contraventions against the second and third applicants were deliberate, or at the very least, recklessly indifferent, negligent and wilful in the sense that the respondents obtained the benefit of work performance, navigating the minimum hourly rates under the Award, however neglecting the other statutory and Award obligations owed to the applicants. Further, the 2020 contraventions were clearly deliberate, insofar as, for the period of 3 to 4 months, the respondents chose not to pay the first or second applicants their wages and entitlements, whether by failing to pay them or making unauthorised deductions to wages and entitlements. Within 24 hours of the employment relationship ending, the first and second applicants put the respondents on notice of the existence and time for the payment of these entitlements.
On behalf of the respondents, it was submitted there was no deliberate action to commit any of the breaches. They were made as a result of honest mistakes. Before this matter, it was submitted that they were not aware of the requirement for payslips to be provided within a day. No evidence was provided that the applicant’s payslips were provided to the Fair Work Ombudsman after proof of payment was sought.
The Court does not accept that at least some of the actions of the respondents were not deliberate. The making of unauthorised deductions from the applicant’s entitlements is a clear indication of a deliberate decision not to pay what are otherwise the entitlements of the applicants.
In these circumstances, the Court considers that it needs to send a clear message to the respondents of the need to ensure compliance with Award entitlements. This includes the use of proper business systems to ensure the accurate accrual of leave entitlements, and leave loading.
Whether or not senior management was involved in the contraventions
This is not disputed. The second respondent is the sole Director of the first respondent. She is solely responsible for the overall management of the first respondent.
Whether the party committing the contraventions has exhibited contrition, taken corrective action and/or has cooperated with enforcement authorities
On behalf of the applicants, it was submitted that the second respondent has consistently delayed and frustrated the progress of the proceedings, demonstrating a lack of remorse or consideration for the impact her actions have had on the applicants. Even after orders for the payment of monies were made by the Court, the respondents have still failed to make any payments to each of the applicants to rectify the underpayments. While the respondents have appeal rights, to date these have not yet been exercised.
On behalf of the respondents, was submitted that they had an arguable case regarding overpayment. The respondent has taken the proceeding seriously and is taking measures to improve business practices, including seeking legal advice. The respondents now understand the obligation to provide payslips within the prescribed time period and had taken measures to ensure the systems do so. It was submitted that the respondents have made significant adjustments to the conduct of the business in that they now have specific employment contracts drafted and in use for each employee. There has been a change of methods for how credit card returns are processed, so that employees require upper management approval for each return transaction. They have continued to seek advice from Fair Work for all relevant pay scales. Further, they no longer allow employees to login to work through their personal mobile phones. They can only login via the kiosk at the relevant workplace. It was submitted that the respondent was actively engaged with the applicants in several forms of dispute resolution prior to the proceedings. Specific deterrence has been achieved through the changes that have been implemented to the work systems to ensure that the respondents do not commit any further breaches. It was submitted that the cost of the proceedings has been financially straining upon the respondents, and emotionally distressing to the second respondent. It was submitted that the costs of being embroiled in litigation alone, are a sufficient warning to employer to want to avoid committing breaches.
The actions of the second respondent indicate that she formed a view that the first and second applicants in particular had either stolen money from her, or had gamed the respondent’s time recording system such that they had been overpaid. This view persists to the current day and is clear from the oral submissions made by the second respondent during the course of the penalty hearing.
The Court is not satisfied that the second respondent today accepts that any breaches were committed, or if they were, the amounts owing to each of the applicant’s is less than the amount that they were overpaid and/or stole. This unfortunately does not take account of the fact the Court was unable to find the allegations of overpayment and/or stealing were sustained.
The most telling evidence of a lack of real contrition and remorse is the fact that no payments have been made to any of the applicants, including to the third applicant.
During the course of previous submissions to the Court, the second respondent suggested that she was not a particularly successful businesswoman. In the Courts view, this is an understatement. The second respondent clearly has particular views, and having once formed those views, appears reluctant to accept any professional advice which is not in accordance with her views. During the course of penalty submissions, she again was argumentative and reluctant to accept the Court’s findings.
The Court notes the submissions that significant adjustments have been taken in relation to workplace practices. Regrettably, no evidence of been provided of this other than through submissions made from the bar table.
The need to ensure compliance with minimum standards by provision of an effective means for the investigation and enforcement of employee entitlements
On behalf of the applicants, it was submitted that minimum standards were never observed or heeded by the respondents. Reliance was placed on Fair Work Ombudsman v Zillion Zenith International and Anor [2014] FCCA 433 (“Zenith”) at [74] where the following was said:
Compliance with minimum standards is an important consideration in the present case. A principal object of the Fair Work Act is the purpose of Asian of an effective safety net for employee entitlements and effective enforcement mechanisms. Compliance with minimum standards is also vital in creating an even playing field for employers within the same industry as the respondent’s who do not comply with workplace laws.
On behalf the respondent’s, it was submitted the respondents had actively engaged with the applicants and several forms of dispute resolution prior to these proceedings with.
The Court adopts the comments as set out in Zenith. While the respondent submits they engaged with the applicants and various alternative dispute resolution procedures, including with Fair Work Commission, the matter did not resolve and a defended hearing was necessary to determine the issues between the parties. Overall, the Courts considers this factor neutral in the assessment of penalty.
The need for specific and general deterrence
On behalf of the applicants, it was submitted the respondents demonstrated a pattern of behaviour across both its stores in the Greater Sydney region, and in the circumstances the third applicant, in a completely unrelated situation to that of the first and second applicants. The respondents’ actions indicate a trend of employing young and vulnerable staff and manipulating their entitlements as they see fit.
It was submitted that there is a clear need for general deterrence in the retail industry so that other employers might consider manipulating payslips with unauthorised deductions lacking foundation, will see that the cost of so doing is significant.
It was submitted the practice of selecting which entitlements will be paid to departing employees, and if they will be paid at all, is to be deplored. The fact that the respondents admitted that annual leave loading applied to the second applicant and that it has still not been paid should be factored into the level of penalties awarded against the respondent’s. It was submitted that the level of culpability of the respondents for the non-payment within the prescribed period of wages and accrued leave should be assessed as halfway of mid-range. The payslips and leave loading contraventions require a higher level of culpability, in the border line high range. This is the case because the failure to pay leave loading does not have any identified reason.
On behalf of the respondents, it was submitted that specific deterrence has been achieved through the institution of these proceedings. It was submitted the general deterrence is achieved to a small business, like the first respondent, and simply the costs are being embroiled in litigation alone and a sufficient warning to an employer to want to avoid committing the breach.
In this case, the Court considers that there is a significant need for there to be a higher than perhaps otherwise level of specific deterrence given the continuing failure of the respondents to correct the matters that were identified in the liability judgement.
The Court does not accept that the mere fact of being embroiled in litigation is a general deterrent. Litigation was only necessary due to the unwillingness of the respondents to recognise that entitlements were due and payable.
In terms of the appropriate penalty to be imposed for each contravention, in respect of items (a) and (b) the applicant submitted that a penalty in respect of the first respondent should be in the range of 13.7%-25% of the maximum or $8,500.00-$15,750.00. In respect of the second respondent it was submitted a penalty in the range of $1,700.00- $3,150.00.
In relation to item (c), the unauthorised deduction, it was submitted by the applicants that the first respondent should pay a penalty in the range of 16.6% to 25% of the maximum or $10,500.00-$15,750.00. In respect of the second respondent the percentage range was the same or $2,100.00-$3,150.00.
In respect of item (d), failure to accrue annual leave on the second applicant between 14 January to 24 February, it was recommended the first respondent pay a penalty in the range of 10-12.5% of the maximum or $6,300.00-$7,875.00. In respect of the second respondent, the percentage range is the same with the amounts being $1260.00- $1575.00.
In respect if item (e) above, the failure to provide payslips, a penalty in the range of 7.13% to 12.5% of the maximum was recommended or $4,500.00-$7,875.00. In respect of the second respondent, the penalty range was $900.00-$1,575.00.
This would result in a total penalty of $29,800-$55,125 in respect of the first respondent and $5,960-$9,540 in respect of the second respondent.
No penalty range was submitted on behalf of the first and second respondents. The Court was asked to take into account the respondents had paid $60,000 in legal costs to date. No evidence was submitted to support this claim.
Step Four – Set an individual penalty in respect of each contravention
In relation to the first respondent the Court is satisfied the appropriate penalties are as follows for each item:
a.+ b. $10,000
b.$12,500
c.$6,500
d.$6,500
Total $35,500
In respect of the second respondent, the Court is satisfied that the appropriate penalties are as follows:
a.+ b. $2,500
b.$2,500
c.$1,350
d.$1,000
Total $7,350
Step Five – Consider the overall penalties on the basis of them being appropriate and proportionate
The Court has considered the total amount proposed and considered overall, it is proportionate and appropriate to the conduct found to have occurred. Item e. has been reduced given a degree of overlap between it and items a. and b.
Conclusion
The first respondent is to pay a pecuniary penalty of $35,000.00 and the second respondent a pecuniary penalty of $7,350.00, pursuant to s 546(3)(c) of the Act. These penalties are to be paid to the applicants. The penalties are to be paid within 28 days of the date of these orders.
I certify that the preceding sixty-five (65) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Humphreys. Associate:
Dated: 28 November 2022
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