Woldenberg v NSI Retail Pty Ltd
[2015] FCCA 3026
•27 October 2015
FEDERAL CIRCUIT COURT OF AUSTRALIA
| WOLDENBERG v NSI RETAIL PTY LTD | [2015] FCCA 3026 |
| Catchwords: INDUSTRIAL LAW – Small claims application – non-payment of wages – respondent in default – undefended hearing. |
| Legislation: Fair Work Act 2009 (Cth), s.548 |
| Aon Risk Services Australia Limited v Australian National University (2009) HCA 27 McShane v Image Bollard Pty Ltd [2011] FMCA 215 Black v Young Republic & Anor [2012] FMCA 729 Jones v Groovy Freighters Pty Ltd [2010] FMCA 673 Lebot v Energetic IT Pty Ltd [2011] FMCA 755 Josephson v Walker (1914) 18 CLR 691 Textile, Clothing and Footwear Union of Australia v Givoni Pty Ltd (2002) 121 IR 250 |
| Applicant: | MAYTAR WOLDENBERG |
| Respondent: | NSI RETAIL PTY LTD T/A PREMIER COSMETICS |
| File Number: | MLG 678 of 2015 |
| Judgment of: | Judge O'Sullivan |
| Hearing date: | 27 October 2015 |
| Date of Last Submission: | 27 October 2015 |
| Delivered at: | Melbourne |
| Delivered on: | 27 October 2015 |
REPRESENTATION
| The Applicant: | Appeared in person |
| The Respondent: | Ms Berrebi, Director, appeared in person. |
ORDERS
THE COURT ORDERS THAT:
The respondent’s oral application for an adjournment be refused.
The applicant have leave to proceed undefended pursuant to Rule 13.03A(2) (a) (b) (ii) (iii) (vii) and 13.03B(2)(d) of the Federal Circuit Court Rules 2001.
THE COURT DELARES THAT:
The respondent contravened the General Retail Industry Award 2010 and the Fair Work Act 2009 (“the FW Act”).
THE COURT ORDERS THAT:
Pursuant to s.545(2)(b) of the FW Act the respondent within 21 days pay the applicant $9,847.42 (gross) by electronic funds transfer to BSB 082 155 Account Number 740 164 959.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLG 678 of 2015
| MAYTAR WOLDENBERG |
Applicant
And
| NSI RETAIL PTY LTD T/A PREMIER COSMETICS |
Respondent
REASONS FOR JUDGMENT
(Revised from transcript)
Before the Court today, 27 October 2015, is an application filed on 1 April 2015 by Maytar Woldenberg (“the applicant”). The application was filed in the small claims list of the Fair Work Division of the Court. It was supported by a form 5 also filed on 1 April 2015. The respondent to the application as filed was NSI Retail Pty Ltd T/A Premier Cosmetics (“the respondent”). Aside from an interlocutory application filed on 24 June 2015, the respondent has not filed any material.
The application was given a first court date on 22 July 2015.
On that occasion the applicant appeared in person. There was no appearance by the respondent. A solicitor did seek leave to appear and to make, inter alia, an application for leave to appear, and if granted to deal with the abovementioned interlocutory application. When leave was refused, for the reasons given extempore, there was then an oral application for an adjournment as the Court was told the respondent’s director was overseas.
On 22 July 2015 the Court made the following orders:
“THE COURT ORDERS THAT:
1. Pursuant to Rule 13.03A(2)(a)(b)(ii)(vii) and 13.03B(2)(d); and 13.03C(1)(e) of the Federal Circuit Court Rules 2001 the respondent’s interlocutory application filed 24 June 2015 be dismissed.
2. The small claims application filed 1 April 2015 be listed for hearing in the Federal Circuit Court of Australia at Melbourne at 10:00 am on 27 October 2015.
3. The applicant have leave to make an oral application to appear by phone on the adjourned date.
4. The applicant have leave to appear by phone on the adjourned date.
5. The respondent appear represented by its Director at Court in Melbourne on the adjourned date.
6. The Respondent file and serve a response to the small claims application and any supporting affidavit within 14 days.
7. No further material be filed by the respondent without an order of the Court.
8. The applicant’s costs of this day be fixed to the amount of $320.00 and the question be reserved.”(emphasis added)
The matter has returned to Court today 27 October 2015. The applicant (pursuant to the orders of 22 July 2015) has appeared by telephone and Ms Berrebi, the director of the respondent, appeared in person. Since the last Court date the applicant has filed an amended form 5 and affidavit on 11 October 2015, which the respondent confirmed today had been served.
In the amended form 5 the applicant said at Part I:
“Wages:
The Respondent failed to pay me the award wage for time worked during the following periods:
- 9 of July 2014 to 9 January 2015 - $23.15 per hour for 20 hrs of work a week.
24 Sundays, 22 Saturdays and 73 Monday to Fridays
A total of 119 working days
- Please refer to Attachment A – payment records showing the 119 days I worked for the employer.
- Attachment B – Bank statements for salary transfer from NSI Retail Pty LTD (sic) to Maytar Woldenberg showing the underpayment
-Attachment C – Fair Work paycheck plus rates for the General Retail Industry Award 2010- Attachment D – NSI Retail Pty LTD (sic) Company details from the ASIC
Hours of work:
24 Sundays working 12 hours = 288 hours
22 Saturdays working 2 hours = 44 hours
73 Regular days working 2 hours =146 hours
Total of 478 working hours
Regular hour rate of $23.15
146 regular hours * 23.15$ = 3,379.9$
Sunday hour rate of 37.04$
288 Sunday hours * 37.04$ = 10,667.52$
Saturday hour rate of 25$
44 Saturday hours * 25$ = 1,100$
Total: 15,147.42$
Minus $5,300 amount paid by the employer for base monthly salary for September, October and November 2014.
A total of 9,847.42
Other:
1. An unlawful deductions (sic) of $50 every week for 24 weeks which was not in the initial agreement.
In the salary slips it is called “Accounting”.
A total of $1,200.
2. Flight Ticket payback was 1,800USD according to the working agreement and was to be paid back to me after 6 months work. The company paid for the ticket and then fully deducted out of my (sic) salary as shown in ATTACHMENT A and only 75% was paid back to me.
In the salary slips there are 3 credit payments of $479 with the words “flight payback” next to it.
Left to pay $479
3. My employer (Ms Stav Berrebi) and I agreed to fund my education ($5,500) equally in the initial working agreement. Secondly half of my education fee (2,750$) was deducted out of my salary and Ms Stav Berrebi paid a very small amount of my money she took (1,700$) to the college and left the debt under my name.
Left to pay: $3,800
4. An unlawful deductions (sic) of 10% out of my commission, which was not in the initial working agreement.
I have sold a total gross of $91,202, My (sic) Commission was 30% out of the gross amount and from that an unlawful deduction of 10%. Which is $91, 202 * 30% * 10% = $2,736
Left to pay: $2,736
5. Summary
$1,200
$479
$3,800
$2,736Total: $8,215
6. The employer terminated the agreement after 6 months.”
In the above mentioned affidavit the applicant deposed:
“…1. The terms of the initial agreement were unlawful because the award rates were lower than fair work hour rate and other terms were not fulfilled.
2. The terms of the initial working agreement were:
– Salary base 100$ for a working day and Commission of 30% from my gross sales
– Living expenses deduction of 150$ a week
– Flight Ticket 1800USD to be paid back to me after 6 months work. The company paid for the ticket and then fully deducted out of my salary and only 75% was paid back to me.
– My employer and I agreed to fund my education (5,500$) equally, secondly half of my education fee (2,750$) was deducted out of my salary and Ms Stav Berrebi paid a very small amount of it (1,700$) to the college and left the debt under my name.
3. After appearing in court on July 22th (sic), Work Fair suggested to file an amendment because the hour rates I calculated were incorrect. Also suggested (sic) to consult with Justice Connect for assistance. Justice Connect were very helpful in this process.”
The applicant told the Court the amended form 5 reflected a reduced amount she alleges is owing to her following her employment with the respondent for the reasons set out therein.
The applicant told the Court these amended calculations were arrived at with the assistance of officers of the Fair Work Ombudsman who were at Court on the last occasion who were provided with details of the material on which the applicant relied.
On 22 July 2015 there was a solicitor at Court with instructions to act on behalf of the respondent when the above mentioned orders were made. The respondent is clearly aware of the orders made on 22 July 2015. The respondent, despite being given the opportunity under the orders of 22 July 2015, has not filed with the Court a response or affidavit. Ms Berrebi told the Court today she had sent documents to the Court when she was overseas and had thought that was sufficient. However, no response or affidavit has been filed.
The respondent then, having had the opportunity to see the duty lawyer today, sought to make an oral application for an adjournment. These are proceedings in the small claims list of the Fair Work Division of the Federal Circuit Court. The aim of that list is to deal with matters on the first court date. This matter was adjourned for hearing today on the first Court date so the respondent could have the opportunity to properly participate and hasn’t done so.
Given the decision of the High Court of Australia in Aon Risk Services Australia Limited v Australian National University (2009) HCA 27 (Aon) and the factors set out therein, having considered the stated reason for the adjournment given and weighing the prejudice to the respondent if it was refused, against the prejudice to the applicant if it was granted that application was refused.
The applicant’s small claims application is governed by section 548 of the Fair Work Act 2009 (Cth) (“the FW Act”) which states:
“Plaintiffs may choose small claims procedure
(1)Proceedings are to be dealt with as small claims proceedings under this section if:
(a)a person applies for an order (other than a pecuniary penalty order) under Division 2 from a magistrates court or the Federal Circuit Court; and
(b)the order relates to an amount referred to in subsection (1A); and
(c)the person indicates, in a manner prescribed by the regulations or by the rules of the court, that he or she wants the small claims procedure to apply to the proceedings.
(1A) The amounts are as follows:
(a)an amount that an employer was required to pay to, or on behalf of, an employee:
(i) under this Act or a fair work instrument; or
(ii) because of a safety net contractual entitlement; or
(iii) because of an entitlement of the employee arising under subsection 542(1);
(b)an amount that an outworker entity was required to pay to, or on behalf of, an outworker under a modern award.
Limits on award
(2)In small claims proceedings, the court may not award more than:
(a)$20,000; or
(b)if a higher amount is prescribed by the regulations--that higher amount.
Procedure
(3)In small claims proceedings, the court is not bound by any rules of evidence and procedure and may act:
(a) in an informal manner; and
(b) without regard to legal forms and technicalities.
(4)At any stage of the small claims proceedings, the court may amend the papers commencing the proceedings if sufficient notice is given to any party adversely affected by the amendment.
…”
In McShane v Image Bollards Pty Ltd,[1] Lucev FM (as His Honour then was) said of this process:
[1] McShane v Image Bollards Pty Ltd [2011] FMCA 215
“Section 548(3) of the FW Act provides as follows:
5.Procedure
(3)In small claims proceedings, the court is not bound by any rules of evidence and procedure and may act:
(a) in an informal manner; and
(b) without regard to legal forms and technicalities.
6.Rule 45.11(2) of the FCCA Rules provides as follows:
(2)The Court is not bound by the rules of evidence when dealing with a small claim application, but may inform itself of any matter in any manner as it thinks fit.
7.Although the Court is not bound by the rules of evidence, and may act informally, and without regard to legal forms and technicalities in small claims proceedings in the Fair Work Division, this does not relieve an applicant from the necessity to prove their claim. The Court can only act on evidence having a rational probative force. The necessity to prove the claim was pointed out with particularity to the parties at the directions hearing on 18 March 2011. That particularity was necessary because Mr McShane had described the hearing, which the Court had just ordered be listed for 31 March 2011, as the “next get-together” (or words to that effect). The Court was at pains to point out that it was in fact a hearing at which the claim would need to be proved. Thus, Mr McShane was on notice that he would need to attend the hearing and prove his claim.”[FOOTNOTES OMITTED].
I also refer to the decision of Nicholls FM (as His Honour then was) in Black v Young Republic & Anor [2012] FMCA 729 where His Honour noted the provisions in section 548 set out above and the decision in Jones v Groovy Freighters Pty Ltd [2010] FMCA 673 and said:
“6.Further, Burnett FM noted that (at [10]):
“... Commonly small claims applications are conducted in the States by their Tribunals rather than courts. They are called upon to determine these disputes in a manner which can be described as somewhat “quick and dirty” to provide flexibility to dispose of such proceedings both informally and cost effectively.”
7.In McShane v Image Bollards Pty Ltd [2011] FMCA 215, Lucev FM (at [7]) also commented on the nature of small claims proceedings and the exercise of the Court’s judicial power within the proceedings informal structure:
“Although the Court is not bound by the rules of evidence, and may act informally, and without regard to legal forms and technicalities in small claim proceedings in the Fair Work Division, this does not relive an applicant from the necessity to prove their claim. The Court can only act on evidence having a rational probative force.”
[Footnote omitted.]
8.The observations made by Burnett FM and Lucev FM are, in my respectful view, important. While the small claims process allows for the Court to act in an informal manner, without regard to legal forms and technicalities and to not be bound by rules of evidence and procedure (s.548(3)), those allowances must be balanced against the Court’s exercise of its judicial power. That is, the Court can only make a decision where a claim is supported by some probative basis in fact. Further, that decision must be supported by a reasoned judgment that addresses the issues in the case.
9.In this light, I also have regard to what was said by:
Federal Magistrate Lucev in Lebot v Energetic IT Pty Ltd [2011] FMCA 755:
“Small claims jurisdiction – practice and procedure
[7] Section 548(3) of the FW Act provides as follows:
· Procedure
· (3) In small claims proceedings, the court is not bound by any rules of evidence and procedure and may act:
· (a) in an informal manner; and
· (b) without regard to legal forms and technicalities.
[8] Rule 45.11(2) of the FMCA Rules provides as follows:
(2)The Court is not bound by any rules of evidence and procedure when dealing with a small claims application and may act:
· (a) in an informal manner; and
· (b) without regard to legal forms and technicalities.
[9]Although the Court is not bound by the rules of evidence, and may act informally and without regard to legal forms and technicalities in small claims proceedings in the Fair Work Division, this does not relieve an applicant from the necessity to prove the claim. The Court can only act on evidence having a rational probative force. For that reason the Court had Mr Lebot give evidence which confirmed the detail of his claim as it appeared in the Form 5 claim form, plus other details which the Court considered it necessary to enquire about.”
Rules 13.03A and 13.03B of the Federal Circuit Court Rules2001 (“the Rules”) provide:
“Rule 13.03A:
1.For rule 13.03B, an applicant is in default if the applicant fails to:
(a)comply with an order of the Court in the proceeding; or
(b)file and serve a document required under these Rules; or
(c)produce a document as required by Part 14; or
(d)do any act required to be done by these Rules; or
(e)prosecute the proceeding with due diligence.
2.For rule 13.03B, a respondent is in default if the respondent:
(a) has not satisfied the applicant's claim; and
(b) fails to:
(i) give an address for service before the time for the respondent to give an address has expired; or
(ii) file a response before the time for the respondent to file a response has expired; or
(iii) comply with an order of the Court in the proceeding; or
(v) file and serve a document required under these Rules; or
Rule 13.03B
1.If an applicant is in default, the Court may order that:
(a)the proceeding be stayed or dismissed as to the whole or any part of the relief claimed by the applicant; or
(b)a step in the proceeding be taken within the time limited in the order; or
(c)if the applicant does not take a step in the time mentioned in paragraph (b)--the proceeding be stayed or dismissed, as to the whole or any part of the relief claimed by the applicant.
(2)If a respondent is in default, the Court may:
(a)order that a step in the proceeding be taken within the time limited in the order; or
(b)if the claim against the respondent is for a debt or liquidated damages--grant leave to the applicant to enter judgment against the respondent for:
(i) the debt or liquidated damages; and
(ii) if appropriate--costs; or
(c)if the proceeding was commenced by an application supported by a statement of claim or the Court has ordered that the proceeding continue on pleadings--give judgment against the respondent for the relief that:
(i) the applicant appears entitled to on the statement of claim; and
(ii) the Court is satisfied it has power to grant; or
(d)give judgment or make any other order against the respondent; or
(e)make an order mentioned in paragraph (b), (c) or (d) to take effect if the respondent does not take a step ordered by the Court in the proceeding in the time limited in the order.
…”
The Rules provide the Court with authority to give judgment or to make any other order against the respondent. I am satisfied the respondent has not satisfied the applicant’s claim. The respondent has not filed a response or affidavit as required under the Rules and the orders of 22 July 2015. The respondent has not complied with an order of this Court and having regard to rules 13.03A(2)(a), 13.03A(2)(b)(i), (ii), (iii), (iv) and (vii) the respondent is in default for the purposes of rule 13.03B(2). A combination of the abovementioned parts of rules 13.03A(2) and 13.03B(2)(d) provides the Court with ample authority to give judgment or make any other order against the respondent.
Given the default by the respondent and the material that the applicant has filed, I am satisfied that I am able to make orders in the terms sought by the applicant for the amount particularised in the amended form 5, having regard to the provisions of section 548 of the FW Act and on the evidence before the Court.
It has been well established that it is not possible to contract out of award rights and obligations (see Josephson v Walker (1914) 18 CLR 691). The applicant’s claim, and the material on which she relied, makes clear the respondent deducted monies from wages due to her under the relevant modern award and there is no evidence of any lawful basis for this.
The principles applicable to determining whether payments made by an employer to an employee can be off-set against payments due under an award have been considered in a number of authorities. These authorities were discussed by Goldenberg J in Textile, Clothing and Footwear Union of Australia v Givoni Pty Ltd (2002) 121 IR 250 and those principles don’t assist the respondent in this case.
I am satisfied on the balance of probabilities that the applicant has made out her case. I therefore make the necessary declaration of contravention and order pursuant to section 545 of the FW Act that the respondent pay to the applicant the amount of $9, 847.42 (gross) within 21 days.
I certify that the preceding twenty (20) paragraphs are a true copy of the reasons for judgment of Judge O'Sullivan
Associate:
Date: 11 November 2015
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