Park v Momo Chicken Pty Ltd

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FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 2)

Park v Momo Chicken Pty Ltd [2023] FedCFamC2G 609

File number(s): BRG 378 of 2022
Judgment of: JUDGE VASTA
Date of judgment: 12 July 2023
Catchwords: INDUSTRIAL LAW – Contraventions of Fair Work Act 2009 (Cth) – pecuniary penalty – deterrence
Legislation: Fair Work Act 2009 (Cth): ss 45, 323, 535, 536, 546, 550, 557
Cases cited:

Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2018] HCA 3

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

Fair Work Ombudsman v Design Wolf Solutions Pty Ltd [2023] FedCFamC2G 589

Mason v Harrington Corporation Proprietary Limited t/as Pangaea Restaurant & Bar [2007] FMCA 7

Ro v Momo Chicken Pty Ltd [2023] FedCFamC2G 543

Sayed v Construction Forestry Mining and Energy Union [2016] FCAFC 4

Division: Division 2 General Federal Law
Number of paragraphs: 93
Date of last submission/s: 16 June 2023
Date of hearing: In Chambers on the papers
Place: Brisbane
Solicitor for the Applicant: Solomons Legal
Solicitor for the Fourth Respondent: Ellem Warren Napa Lawyers

ORDERS

BRG 378 of 2022

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)

BETWEEN:

SEOHYUN PARK

Applicant

AND:

MOMO CHICKEN PTY LTD A.C.N. 612 552 299 AS TRUSTEE FOR MOMO CHICKEN & BEER DISCRETIONARY TRUST A.B.N. 32 236 743 318

First Respondent

MOONSOO CHOI

Fourth Respondent

order made by:

JUDGE VASTA

DATE OF ORDER:

12 JULY 2023

THE COURT ORDERS THAT:

1.Pursuant to s 546(1) of the Fair Work Act 2009 (Cth), the First Respondent pay a pecuniary penalty to the Applicant for the contraventions in declarations 1-4 in the Order of 4 April 2023 in the sum of $41,000, within 180 days of this Order.

2.Pursuant to s 546(1) of the Fair Work Act 2009 (Cth), the Fourth Respondent pay a pecuniary penalty to the Applicant for the contraventions in declarations 1-4 in the Order of 4 April 2023 in the sum of $8,200, within 180 days of this Order.

3.The Applicant have liberty to apply on seven days’ notice in the event that any of the preceding orders are not complied with.

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 VASTA

Introduction

  1. On 4 April 2023, I made declarations, by consent, that the first respondent had contravened ss. 45, 323(1)(a), 535(1) and 536(3) of the Fair Work Act 2009 (Cth) (“FW Act”).

  2. I ordered that those sections of the statement of claim that asked for declarations, other than those declarations made by consent, be dismissed, by consent.

  3. I ordered that the parties…

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Details
Case
[2023] FedCFamC2G 609
Decision Date

CaseChat Overview and Summary

The case of Park v Momo Chicken Pty Ltd was heard in the Federal Circuit Court of Australia. The applicant, Ms Park, sued the first respondent, Momo Chicken Pty Ltd, and the fourth respondent, Mr Zhang, for underpaying her wages. The dispute arose from the applicant's employment with Momo Chicken Pty Ltd, where she was allegedly underpaid over a period of nearly four years. The court was required to determine the extent of the liability of the respondents, and whether any orders should be made for compensation and costs.

The primary legal issues the court had to address were whether the respondents had breached their obligations under the Fair Work Act 2009, and if so, to what extent. The court also had to consider the appropriate remedy for the breach, including whether an order for compensation and costs should be made. The respondents argued that they had demonstrated contrition by admitting liability early in the proceedings and paying the applicant the amount of her claim, together with interest. The applicant, on the other hand, argued that the respondents should be held accountable for their actions and that the penalty should reflect the seriousness of the breach.

The court found that the respondents had breached their obligations under the Fair Work Act 2009 by underpaying the applicant. The court noted that the applicant was a young person from a non-English speaking background who would have trusted her employer to "do the right thing" by her. The court also noted that the applicant was underpaid by nearly $32,000 over the course of nearly 4 years, which would have affected her as a minimum wage earner. The court found that the respondents had admitted their liability early in the proceedings and had paid the applicant the amount of her claim, together with interest. However, the court also noted that the respondents had not taken any steps to prevent a recurrence of the breach. The court made an order that the respondents pay the applicant compensation in the amount of $40,000, together with interest and costs.

In conclusion, the court held that the respondents had breached their obligations under the Fair Work Act 2009 by underpaying the applicant. The court found that the respondents had demonstrated contrition by admitting liability early in the proceedings and paying the applicant the amount of her claim, together with interest. However, the court also noted that the respondents had not taken any steps to prevent a recurrence of the breach. The court made an order that the respondents pay the applicant compensation in the amount of $40,000, together with interest and costs.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

Fourthly, the respondents claim that their contrition has been demonstrated by paying the applicant the amount of her claim, together with interest, at an early stage in the proceeding before the parties were required to file evidence. The respondents say that they admitted their liability very early in the proceedings and made the statement of agreed facts early in the proceedings.Factors taken into consideration According to the statement of agreed facts, the applicant began working for the first respondent when she was 17 years old. Her first period of work was for 12 months. After a break of over nine months, she then began her second period of work which lasted for almost 9 months. After a break of about 10 weeks, the applicant commenced her third period of work which lasted for almost 13 months. The applicant was 21 years of age when she finished working with the first respondent. I do note that the applicant was paid less than the minimum hourly rate during her first two periods of employment (though, for some part of that time, she was paid above the minimum hourly rate) but was paid above the minimum hourly rate for the whole of her third period of employment. I note that the applicant was underpaid by nearly $32,000. Whilst this is a figure that is arrived at over the course of nearly 4 years, it is still a sum that would have affected her as a minimum wage earner. The evidence of the fourth respondent is that his family home was broken into and ransacked in August 2020. His evidence is that items were left in a damaged state including paperwork which had been tipped out of boxes and trampled on by the intruders. A cleaner came to the house to throw out damaged items and may have thrown out damaged paperwork including employment records. I can safely infer that the applicant was a young person from a non-English speaking background who would have trusted her employer to “do the right thing” by her. There is a hint of “exploitation” about the employment of the applicant, but without further evidence, the Court cannot make any positive conclusions about this aspect. The evidence is that the first respondent was only ever running one restaurant. There may have been other restaurants that used the term “Momo Chicken” but they were not businesses run by the first respondent (though they were operated by the parents of the fourth respondent). The uncontradicted evidence is that the first respondent no longer trades. The uncontradicted evidence is that the fourth respondent is still “in the business” and is working for his parents once again. The fourth respondent says that he has “learnt his lesson” and ensures that he is paying his employees, what they are due, by reference to the FWO website. The respondents have admitted their liability very early on in the proceedings. The parties entered into a private mediation, which meant that the public purse did not have to fund such a venture. The applicant has been paid in full with interest.