United Voice v Lloyds Services Act Pty Ltd

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FEDERAL COURT OF AUSTRALIA

United Voice v Lloyds Services ACT Pty Ltd [2017] FCA 1007

File number(s): ACD 132 of 2015
Judge(s): JAGOT J
Date of judgment: 1 September 2017
Catchwords: INDUSTRIAL LAW – first and second respondents contravened provisions of the Fair Work Act 2009 (Cth) –pecuniary penalties under the Fair Work Act 2009 (Cth)
Legislation: Fair Work Act 2009 (Cth) ss 50, 536, 345, 557
Cases cited:

Commonwealth v Director, Fair Work Building Industry Inspectorate [2015] HCA 46; (2015) 326 ALR 476

Fair Work Ombudsman v Grouped Property Services Pty Ltd (No 2) [2017] FCA 557

Sayed v Construction, Forestry, Mining and Energy Union (2016) 239 FCR 336; [2016] FCAFC 4

United Voice v Phillip Cleaning Service Pty Ltd [2017] FCA 392

Date of hearing: 3 August 2017
Registry: Australian Capital Territory
Division: Fair Work Division
National Practice Area: Employment & Industrial Relations
Category: Catchwords
Number of paragraphs: 19
Counsel for the Applicants: Mr O Fagir
Solicitor for the Applicants: Mr S Russell-Uren of United Voice
Counsel for the Respondents: Mr D Allen
Solicitor for the Respondents: Kekatos Lawyers

ORDERS

ACD 132 of 2015
BETWEEN:

UNITED VOICE

First Applicant

NEEKA MWEE

Second Applicant

EH HTOO GYI (and others named in the Schedule)

Third Applicant

AND:

LLOYDS SERVICES ACT PTY LTD

First Respondent

ANGELO DI DIO

Second Respondent

JUDGE:

JAGOT J

DATE OF ORDER:

1 SEPTEMBER 2017

THE COURT ORDERS THAT:

1.The first respondent pay a pecuniary penalty of $110,000 for its contraventions of ss 50, 345(1) and 536(2)(b) of the Fair Work Act 2009 (Cth).

2.The second respondent pay a pecuniary penalty of $20,000 for his contraventions of ss 50, 345(1) and 536(2)(b) of the Fair Work Act 2009 (Cth).

3.The pecuniary penalties be paid to the first applicant, United Voice, within 28 days.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

JAGOT J:

  1. These reasons for judgment concern penalties to be imposed on the respondents for contraventions of the Fair Work Act 2009 (Cth) as found in my principal judgment, United Voice v Phillip Cleaning Service Pty Ltd [2017] FCA 392. At [50] of my principal judgment I found that:

    PCS and Mr Di Dio have each contravened:

    (1)s 50 of the Fair Work Act by:

    (a)failing to pay employees their ordinary rate of pay for their usual hours worked during each period of school holidays;

    (b)failing to have regard to the language skills of the fourth to sixth and eighth applicants in preparing their letters of appointment;

    (c)not providing any employee with an off-site induction; and

    (d)not paying the third, fourth, tenth, fourteen, fifteenth and twenty-second applicants a 17.5% loading on their ordinary pay in respect of the annual leave which they took in December 2015,

    in breach of a provision or provisions of the Phillip Cleaning Services and LHMU Clean Start Union Collective Agreement 2010 for ACT Government Schools which is an enterprise agreement within the meaning of s…

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Details
Case
[2017] FCA 1007
Decision Date

CaseChat Overview and Summary

United Voice took proceedings against Lloyds Services Act Pty Ltd and Mr Di Dio for contraventions of the Fair Work Act 2009 (Cth). The court found that Lloyds Services Act Pty Ltd and Mr Di Dio had contravened sections 50, 345(1), and 536(2)(b) of the Fair Work Act by failing to pay employees their ordinary rate of pay, not having regard to employees' language skills, not providing off-site inductions, not paying a 17.5% loading on annual leave, knowingly making false and misleading representations about workplace rights, and not providing payslips identifying the employer and employer's ABN. The court considered that the respondents had taken steps to place their assets beyond the reach of the applicants, and had not paid the moneys found to be owed. The court found that the considerations of deterrence, both specific and general, were of particular significance in this case.

The court considered the legal issues of whether the respondents had contravened the Fair Work Act and, if so, what pecuniary penalties should be imposed. The court found that the respondents had contravened the Fair Work Act and imposed pecuniary penalties of $110,000 on Lloyds Services Act Pty Ltd and $20,000 on Mr Di Dio. The court considered that the penalties should be significant to ensure specific and general deterrence, and to reflect the seriousness of the contraventions. The court also considered that the penalties should be proportionate to the respondents' ability to pay.

The final orders of the court were that Lloyds Services Act Pty Ltd pay a pecuniary penalty of $110,000 and Mr Di Dio pay a pecuniary penalty of $20,000. The court ordered that the penalties be paid to United Voice within 28 days. The court considered that the penalties would provide specific and general deterrence, and reflect the seriousness of the contraventions. The court also considered that the penalties were proportionate to the respondents' ability to pay.

Orders

Orders of the court

1. The first respondent pay a pecuniary penalty of $110,000 for its contraventions of ss 50, 345(1) and 536(2)(b) of the Fair Work Act 2009 (Cth).

2. The second respondent pay a pecuniary penalty of $20,000 for his contraventions of ss 50, 345(1) and 536(2)(b) of the Fair Work Act 2009 (Cth).

3. The pecuniary penalties be paid to the first applicant, United Voice, within 28 days.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

These reasons for judgment concern penalties to be imposed on the respondents for contraventions of the Fair Work Act 2009 (Cth) as found in my principal judgment, United Voice v Phillip Cleaning Service Pty Ltd [2017] FCA 392. At [50] of my principal judgment I found that:PCS and Mr Di Dio have each contravened:(1)s 50 of the Fair Work Act by:(a)failing to pay employees their ordinary rate of pay for their usual hours worked during each period of school holidays;(b)failing to have regard to the language skills of the fourth to sixth and eighth applicants in preparing their letters of appointment;(c)not providing any employee with an off-site induction; and(d)not paying the third, fourth, tenth, fourteen, fifteenth and twenty-second applicants a 17.5% loading on their ordinary pay in respect of the annual leave which they took in December 2015,in breach of a provision or provisions of the Phillip Cleaning Services and LHMU Clean Start Union Collective Agreement 2010 for ACT Government Schools which is an enterprise agreement within the meaning of s 50 of the Fair Work Act; (2)s 345 of the Fair Work Act by knowingly making a false and misleading representation to the fourth to sixth and eighth applicants in their letters of appointment about their workplace rights;(3)s 536(2)(b) of the Fair Work Act by not providing employees with a payslip identifying their employer and employer’s ABN in the periods of about 26 October 2010 and 19 December 2011, August 2012 and June 2013, and 2 December 2014 and 24 February 2015. These reasons are to be read with my principal judgment. I continue to use the terms defined in the principal judgment in these reasons, albeit recognising that the first respondent has since changed its name to Lloyd’s Cleaning ACT Pty Ltd. Subsequent to the principal judgment the respondents have carried out or failed to carry out certain acts which persuade me that the considerations of deterrence, both specific and general, are of particular significance in the present case. They also persuade me that the respondents continue to refuse to acknowledge their responsibility for the contraventions or any obligation to rectify them. As such, it is not merely that the respondents cannot be found to be contrite; the respondents may be inferred to have deliberately taken steps to place their assets beyond the reach of the applicants who have been systematically underpaid as a result of Mr Di Dio’s view, as found at [14] of the principal judgment, that he “felt entitled to run PCS as he thought fit irrespective of any legal obligations of PCS to its employees”. Given their conduct it may come as no surprise that the respondents have not paid the moneys found to be owed to the applicants. Further, as the applicants submitted, the additional evidence establishes that:(a)On 27 May 2016, immediately before the filing of the defence, charges over all PCS property were registered in favour of two Cassiniti entities, Accolade Advisory and Reliance Financial Services. (b)On 22 June 2016, immediately after filing the defence, a further charge over all PCS property was registered in favour of Reliance Financial Services. (c)On 21 April 2017, that is the date of the Decision, Mr Di Dio transferred real estate owned by him to his wife. The transfer instrument was witnessed by Mr Cassiniti.(d)On 1 May 2017 Mr Di Dio changed the name of the first respondent to “Lloyd’s Cleaning ACT Pty Ltd”. (e)On 18 July 2017 a caveat over real estate owned by Mr Di Dio and his wife as joint tenants was registered in in favour of Accolade Advisory.

Ratio Decidendi

Legal Principle Established

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