Nabi v New ERA Balustrading Pty Ltd

[2020] FCCA 1939

FEDERAL CIRCUIT COURT OF AUSTRALIA

NABI v NEW ERA BALUSTRADING PTY LTD & ANOR [2020] FCCA 1939

Catchwords:
INDUSTRIAL LAW – Fair Work Proceedings – application for unpaid wages and superannuation – whether the applicant was entitled to paid annual leave – whether respondents breached relevant Acts and Awards in regards to those underpayments – whether the second respondent is involved in the contraventions pursuant to s 550 of the Fair Work Act 2009 (Cth) – whether the first and second respondent pay penalties pursuant to s 546(1) of the Fair Work Act 2009 (Cth) – first and second respondent knowingly involved in contraventions – penalties payable to the applicant.

Legislation:

Fair Work Act 2009 (Cth), ss.45, 232, 323, 546, 550

Federal Circuit Court Rules 2001 (Cth), r.9.04

Manufacturing and Associated Industries and Occupations Award 2010, cl.2.4.1

Cases cited:

Fair Work Ombudsman v South Jin Pty Ltd [2015] FCA 1456

Applicant: MD SAIFUL ISLAM NABI

First Respondent: NEW ERA BALUSTRADING PTY LTD (ACN 604 390 329)

Second Respondent: ANDREW GEORGE TORNYA

File Number: SYG 1911 of 2019

Judgment of: Judge Humphreys

Hearing date: 15 July 2020

Date of Last Submission: 15 July 2020

Delivered at: Parramatta

Delivered on: 17 July 2020

REPRESENTATION

Counsel for the Applicant: Mr Moir

Solicitors for the Applicant: Australian Business Underwriter

First Respondent: No appearance

Second Respondent: In person

ORDERS

1. The First Respondent contravened s 232(1) of Fair Work Act 2009 (Cth), by failing to pay the Applicant amounts payable to him in respect of performance of work, during the period of 25 October 2018 to 1 March 2019, in the amount of $30,780.00.

2. The First Respondent contravened s 45 of the Fair Work Act 2009 (Cth), by failing to pay the Applicant for the period of 26 October 2018 to 12 February 2019:

   (a)A minimum weekly/hourly wage, contrary to cl 2.4.1 as determined by the Manufacturing and Associated Industries and Occupations Award 2010 (“the Award”).

   (b)Superannuation contributions to a superannuation fund for the benefit of the applicant, contrary to cl 35.2 of the Award, in the amount of $2,924.10.

3. Interest on the above amounts.

4. That the First and Second Respondents are to pay the above amounts within 28 days of the date of these orders.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT PARRAMATTA

SYG 1911 of 2019

MD SAIFUL ISLAM NABI

Applicant

And

NEW ERA BALUSTRADING PTY LTD (ACN 604 390 329)

First Respondent

ANDREW GEORGE TORNYA

Second Respondent

REASONS FOR JUDGMENT

Introduction

1. This is an application under the Fair Work Act2009 (Cth) (“the FW Act”). The applicant claims that he was employed as a Metal Fabricator by the First Respondent. The Second Respondent is the sole Director of the First Respondent.

2. The Applicant seeks the following orders:

   1.   The First and Second Respondents pay the Applicant the sum of $30,780.00 for unpaid wages within 28 days of this Order.

   2.   The First and Second Respondents, within 28 days, make contributions on behalf of the Applicant, to his nominated superannuation fund, in respect of the loss of wages referred to in Order 1 at the superannuation guarantee charge rate prescribed by applicable superannuation legislation.

   3.   The First and Second Respondents pay the Applicant the sum of $2,367.63 for untaken annual leave within 28 days of this Order.

   4.   The First and Second Respondents pay interest on the sums set out in Orders 1 to 3 above.

   5.   The First and Second Respondents pay penalties pursuant to
   s 546(1) of the Fair Work Act 2009 (Cth) for the contraventions set out in Orders 1 to 3 above.

   6.   The First and Second Respondents are to pay the said penalties to the Applicant within 28 days of this Order.

The Applicant’s Case

1. The applicant asserts he commenced full-time employment with New Era Balustrading on 1 July 2015. The applicant’s employment was regulated by the Manufacturing and Associated Industries and Occupations Award 2010 (“the Award”). It was agreed that the applicant would be paid $45.00 per hour, for each ordinary hour worked.

2. It is claimed that due to financial difficulty, the first respondent ceased to pay any wages and superannuation to the applicant, for the period 26 October 2018 until 15 February 2019, despite the applicant continuing to perform work, on a full-time basis during that period. Until 11 January 2019, the first respondent continued to issue weekly payslips, in respect of the applicant, without making any payment of wages or superannuation. From 16 February 2019 to 1 March 2019, the respondents refused to provide the applicant with any shifts, despite the applicant being willing to perform work.

3. It is asserted that the applicant continued to accrue annual leave from the period 26 October 2018 to 1 March 2019 at a rate of 2.9 to 3 hours per week. During this period, the applicant did not take any annual leave.

4. It is claimed that the applicant was not provided any paid public holidays for the period from 26 October 2018 until 1 March 2019.

5. In support of the applicant’ case, he swore an affidavit dated 25 February 2020. In that affidavit, the applicant states that he commenced employment with the respondents on 1 July 2015. The applicant further swears that in early 2018, Md Mostafizur Rahman, also known as Musa, commenced employment with the first respondent as a labourer. The applicant asserts that he was assigned to supervise and provide training to Musa.

6. The applicant states that Musa told him, on 11 February 2019, that they should stop working for “Andrew” (second respondent), as Musa said Andrew did not pay him for the last ten to twelve weeks. The applicant states that he agreed that they would not come into work from 14 February 2019.

7. The applicant further asserts that around 18 February 2019, he drove past the factory and saw Musa inside. When the applicant spoke to Musa, Musa stated that his problem was solved, as he had been offered a 50% partnership in all ongoing and future jobs.

8. In annexures to the applicant’s affidavit, there is material indicating that the second respondent is the sole director of the first respondent. PAYG payment summaries for the applicant are provided for the years ending 30 June 2016, 2017 and 2018.

9. Payslips covering the period 7 September 2018 until 11 January 2019 are provided, which show that the applicant was employed by the first respondent and was paid $45.00 per hour. These same payslips indicate that employer superannuation contributions, amounting to $1,798.14, were to be paid to the applicant’s superannuation fund.

10. Data in relation to annual leave shows a zero balance of accrued leave, together with a zero balance of time used to date for the financial year, for the period covered by the payslips.

11. The applicant has also provided a copy of his superannuation documentation for the year ending 30 June 2018.

The Respondent’s Case

1. At the first return date, on 23 August 2019, the Court made directions that the respondents were to file and serve their defence, on or before 13 September 2019. In a defence filed on 20 September 2019, the respondent asserts that the applicant commenced casual employment with the first respondent on 3 July 2017. It is agreed that the applicant was paid $45.00 per hour. As the applicant was employed as a casual, he was not entitled to annual leave, leave loading, public holidays or sick leave.

2. It is asserted that the applicant did not wish to commence work on a full-time basis, as he worked a second job and preferred the higher rate of pay. It is asserted that the applicant was informed that the first respondent was experiencing financial difficulty.

3. The respondents asserts that the applicant provided them with false timesheets and that he was overpaid as a result. During the period 16 February 2019 to 1 March 2019, the applicant was offered work but refused. The applicant asserts that from 26 October 2018 to 15 February 2019, he was paid by the first respondent, after considering he falsified his timesheets to the gross amount of $18,292.50 or 406.5 hours, at $45.00 per hour.

4. On 13 January 2020, Orders were made by the Court that the respondents were to file and serve any cross-claim upon which they intend to rely, giving complete particulars of each ground by 15 January 2020. That Order was not complied with. On 28 February 2020, further Orders were made that the respondents file and serve any amended defence and affidavit evidence relied upon within 14 days of that date. No further documentation was filed.

5. On 20 May 2020, the matter was fixed for hearing at 10:00am on 15 July 2020. The respondents was directed to file and serve any written submissions 14 days prior to the hearing. Short written submissions were subsequently received.

6. On 3 June 2020, Orders were made that the first respondent was to obtain legal representation, pursuant to r 9.04 for the Federal Circuit Court Rules 2001 (Cth). Leave for the further filing of an amended defence, cross-claim of affidavit evidence by the respondents was refused and the final hearing date of 15 July 2020 was confirmed.

7. On 8 July 2020, the second respondent contacted chambers seeking an adjournment of the hearing date of 15 July 2020. The covering email indicated that the first respondent was unable to obtain legal representation, due to lack of funds. In support of that application for an adjournment, was a medical certificate from Dr Daniel Hameiri, of Double Bay. The medical certificate is regrettably hand written and as a result, difficult to decipher. It states that the applicant suffers from an undecipherable medical condition, most likely cancer and is not advised to attend Court at present, due to the greatly increased risk from COVID-19. Not surprisingly, the applicant objected to the adjournment application, pointing out the failure of the respondents, on numerous occasions, to comply with Court orders and the need for the matter to be determined.

8. In the circumstances, the Court indicated to the second respondent that he could appear by telephone at the hearing, but that any documents upon which he sought to rely, should be filed with the Court prior to the hearing. Notwithstanding this, the second respondent attended Court in person.

The Hearing

1. Given the second respondent was unrepresented, the Court outlined to him the procedure that would be followed.

2. The applicant was called to give evidence. The applicant’s affidavit of 25 February 2020 was tendered. During cross-examination, Counsel for the applicant objected to many of the questions that were put to the applicant, by the second respondent, on the basis that they related to a claim by the second respondent, that he was owed money by the applicant, due to the submissions of his timesheets.

3. It was necessary to point out to the second respondent, that as there was no cross-claim before the Court, the Court could not consider any evidence in relation to allegations of money owed by the applicant, to the first respondent, for overpayment of wages.

4. In response to questions put to him by the Court, the second respondent candidly admitted that the applicant had worked for the first respondent, for the period claimed and had not been paid. Further, superannuation payments had also not been paid for the time worked. The only matter that remained for consideration then fell to the type of employment the applicant was engaged in, either permanent or casual. If the applicant were employed on a casual basis, an issue arose as to whether or not he was entitled to annual holidays and holiday pay.

5. The only evidence that was proposed to be called, on behalf of the respondents, was an affidavit from Md Mostafizur Rahman dated 20 September 2019. That affidavit detailed a conversation that took place between the applicant and the second respondent. Objection was taken to the affidavit, on the basis that it was firstly, first-hand hearsay and secondly, that it was only relevant to the issue of a cross-claim, which was not before the Court. The tender of the affidavit and evidence from Mr Rahman was rejected in that the Court was not satisfied it was relevant to the matters before the Court.

6. No other evidence was called, on behalf of the respondents.

Consideration

1. In order for the claim to succeed, the Court needs to be satisfied that there is evidence to support each of the claims made by the applicant. The evidence, which is outlined above, is surprisingly deficient in relation to many of the matters that the Court is required to determine.

2. Based on the admissions of the second respondent, the Court is reasonably satisfied that the applicant commenced employment with the first respondent in July 2015. The Court is also satisfied that from late October 2018 until about 11 February 2019, the applicant worked for the first respondent for 38 hours per week. The Court is reasonably satisfied that the applicant suffered loss of wages in the amount of $30,780.00, being $45.00 per hour x 38 hours x 18 weeks. This amounts to a breach of s 323(1) of the FW Act.

3. The Court is also reasonably satisfied, based on the admissions of the second respondent, that the applicant was not paid superannuation contributions to a superannuation fund, for the benefit of the applicant, for the period 26 October 2018 to 11 February 2019. This loss amounts to $2,924.10. The failure to pay superannuation contributions amounts to breach of s 45 of the FW act.

4. This then leaves the issue of annual leave and public holiday pay. The applicant asserts he was employed on a permanent full-time basis. The respondents asserts that the applicant was employed on a casual basis, which is evidenced by the much higher than award hourly rate. Payslips for the relevant period, were attached to the applicant’s affidavit. Those payslips indicate that there was zero hours of personal and holiday time either available or indeed had been used, in the year to the date of the payslip. The second respondent submitted that this was evidence that the applicant was indeed a casual employee. The applicant freely admitted in cross-examination that he worked a second job, but this was in the evenings, on top of the time he worked for the respondents.

5. The applicant only stated in his affidavit that “I was employed in the position of Metal Fabricator”. No evidence has been presented to the Court, by way of a contract of employment or other material, which would indicate whether or not the applicant was employed on a casual or permanent basis. The group certificates or payment summaries that were attached to the applicant’s affidavit, show that his income in the year 2015/16 was $50,707.00, in 2016/17 was $23,205.00 and in 2017/18 was $82,055.00. The applicant claimed that he was employed as permanent full-time, during the entire period.

6. The payment summaries do not support such an assertion, in that one would reasonably expect that the applicant’s pay would not vary so widely, if he was employed on a permanent full-time basis. The Court cannot be reasonably satisfied, on the evidence provided, that the applicant was employed on a permanent full-time basis and not on a casual basis. That aspect of the claim fails.

7. Given the above findings, it is appropriate that the Orders of the Court include that the first and second respondents pay interest on the sum, found to be due and owing, as set out above.

8. Counsel for the applicant submitted that the second respondent was “involved in” each of the first respondent’s contraventions, identified above. Thus, pursuant to s 550 of the FW act, the second respondent should be treated as having committed those contraventions himself (see Fair Work Ombudsman v South Jin Pty Ltd [2015] FCA 1456 at [227] - [234] per White J). It is not disputed that the second respondent was the sole director of the first respondent. In these circumstances the Court is satisfied that the second respondent was knowingly concerned in the conduct of the first respondent and that accessorial liability is established.

Conclusion

1. Accordingly, the orders of the Court are as follows:

   1. The First Respondent contravened s 232(1) of Fair Work Act 2009 (Cth), by failing to pay the Applicant amounts payable to him in respect of performance of work, during the period of 25 October 2018 to 1 March 2019, in the amount of $30,780.00.

   2. The First Respondent contravened s 45 of the Fair Work Act 2009 (Cth), by failing to pay the Applicant for the period of 26 October 2018 to 12 February 2019:

   a) A minimum weekly/hourly wage, contrary to cl 2.4.1 as determined by the Manufacturing and Associated Industries and Occupations Award 2010 (“the Award”).

   b) Superannuation contributions to a superannuation fund for the benefit of the applicant, contrary to cl 35.2 of the Award, in the amount of $2,924.10.

   3.   Interest on the above amounts.

   4.   That the First and Second Respondents are to pay the above amounts within 28 days of the date of these orders.

2. The Court will set a timetable for the provision of submissions in relation to the assessment of civil penalties, pursuant to s 546(1) of the FW Act.

I certify that the preceding thirty-seven (37) paragraphs are a true copy of the reasons for judgment of Judge Humphreys

Associate:

Date: 17 July 2020