Wollermann v Fortrend Securities Pty Ltd (No 2)

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FEDERAL COURT OF AUSTRALIA

Wollermann v Fortrend Securities Pty Ltd (No 2) [2025] FCA 443  

File number(s): VID 209 of 2024
Judgment of: O’CALLAGHAN J
Date of judgment: 6 May 2025
Catchwords: INDUSTRIAL LAW – final orders – pecuniary penalties – contraventions of ss 323 and 536 of the Fair Work Act 2009 (Cth) (FW Act) – scope of serious contravention under s 557A of the FW Act – consideration of principles relating to imposition of pecuniary penalties – penalties imposed
Legislation:

Crimes Act 1914 (Cth) s 4AA

Fair Work Act 2009 (Cth) ss 323, 324, 536(1) and (2), 539(2), 546, 550, 557 and 557A

Trade Practices Act 1974 (Cth)

Long Service Leave Act 2018 (Vic)
Cases cited:

Ahmed v Al-Hussain Pty Ltd t/as The Cheesecake Shop (No 3) [2019] FCA 848

Australian Building and Construction Commissioner v Pattinson (2022) 274 CLR 450

Australian Securities and Investments Commission v Wooldridge [2019] FCAFC 172

Construction, Forestry, Mining and Energy Union v Cahill [2010] FCAFC 39; (2010) 269 ALR 1

Fair Work Ombudsman v Australian Workers’ Union [2020] FCA 60

Fair Work Ombudsman v Foot & Thai Massage Pty Ltd (in liq) (No 8) [2024] FCA 483

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

Fair Work Ombudsman v Tac Pham Pty Ltd [2018] FCA 120

Fortrend Securities Pty Ltd v Wollermann (No 2) [2025] FCA 96

Kirwan v Fortrend Securities Pty Ltd [2019] FCCA 3119

National Tertiary Education Industry Union v University of Sydney (Relief) [2023] FCA 537

Trade Practices Commission v CSR Ltd [1990] FCA 521; (1991) ATPR ¶41-076

Wollermann v Fortrend Securities Pty Ltd [2025] FCA 103
Division: Fair Work Division
Registry: Victoria
National Practice Area: Employment and Industrial Relations
Number of paragraphs: 56
Date of last submission/s: 15 April 2025
Date of hearing: Determined on the papers
Counsel for the Applicants: M Minucci
Solicitor for the Applicants: Seyfarth Shaw
Counsel for the Respondents: J Francis
Solicitor for the Respondents: Cornwalls

ORDERS

VID 209 of 2024
BETWEEN:

CHRISTOPHER JAMES WOLLERMANN

First Applicant

STEPHEN MATTHEW LYLE
Second Applicant
AND:

FORTREND SECURITIES PTY LTD
First Respondent

JOSEPH BURKE FORSTER
Second Respondent

ORDER MADE BY:

O’CALLAGHAN J

DATE OF ORDER:

6 MAY 2025

THE COURT DECLARES THAT:

1.The first respondent contravened:

(a)s 323 of the Fair Work Act 2009 (Cth) (FW Act) by:

(i)failing to pay to the first applicant, in full and at least monthly, his commission on sales earned in May, June, July, August and October 2022 (Wollermann Bonus Payment Contravention);

(ii)failing to pay to the second applicant, in full and at least monthly, his commission on sales earned in May, June, July, August and October 2022 (Lyle Bonus Payment Contravention); and

(iii)deducting, from on or about 16 March 2015 until the cessation of the first applicant’s employment on 16 December 2022, $500 per month from the first applicant’s gross salary (Wollermann Deduction Contravention);

(b)s 536 of the FW Act by:

(i)failing…

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Details
Case
[2025] FCA 443
Decision Date

CaseChat Overview and Summary

In Wollermann v Fortrend Securities Pty Ltd (No 2), the applicant, Mr Wollermann, sought an order for pecuniary penalties against the respondents, Fortrend Securities Pty Ltd and its managing director, Mr Forster, for breaches of the Fair Work Act 2009 (Cth). The applicant argued that the respondents had contravened the Act by withholding bonus payments, unilaterally deducting amounts from pay, and failing to provide pay slips as required. The respondents argued that the contraventions should be treated as a single course of conduct, but the court disagreed, finding that each contravention should be treated separately. The court considered the principles relating to the imposition of pecuniary penalties, including the need for penalties to be reasonable and proportionate to the offence.

The court found that the respondents had contravened the Act by withholding bonus payments from Mr Wollermann and Mr Lyle, unilaterally deducting amounts from Mr Wollermann's pay, and failing to provide pay slips to both employees. The court also found that Mr Forster was liable as an accessory for the Bonus Payment Contraventions and the Wollermann Deduction Contravention. The court considered the seriousness of the contraventions, the respondents' conduct, and the need to deter future breaches when determining the appropriate penalty. The court found that the penalties should reflect the gravity of the contraventions and the need to ensure compliance with the Act.

The court ordered that the respondents pay pecuniary penalties to the applicants for each contravention. The penalties were calculated based on the seriousness of the contraventions, the respondents' conduct, and the need to deter future breaches. The court also ordered that the respondents pay the applicants' unpaid commissions and long service leave entitlements, along with interest. The penalties imposed were intended to reflect the seriousness of the contraventions and to deter future breaches of the Act. The court emphasised the importance of compliance with the Act and the need to protect employees' rights.

Orders

Orders of the court

4. Pursuant to s 545 of the FW Act, within 28 days of the date of these orders, the first respondent is to pay to the first applicant the following sums:

(a) in respect of the Wollermann Bonus Payment Contravention, the sum of $66,313.58 comprised of the following:

(i) $55,396.80 in unpaid commission on sales; and

(ii) $10,916.78 in interest; and

(b) in respect of the Wollermann Deduction Contravention, the sum of $37,839.83 comprised of the following:

(i) $29,500 as compensation for the deductions made between 16 February 2018 and 16 December 2022; and

(ii) $8,339.83 in interest.

5. Pursuant to s 545 of the FW Act, within 28 days of the date of these orders, the first respondent is to pay to the second applicant, in respect of the Lyle Bonus Payment Contravention, the sum of $66,313.58 comprised of the following:

(a) $55,396.80 in unpaid commission on sales; and

(b) $10,916.78 in interest.

6. Pursuant to s 26 of the LSL Act, the first respondent is to pay to:

(a) the first applicant the sum of $149,667.02 comprised of the following:

(i) $122,954 in payment of the first applicant’s unpaid long service leave entitlement; and

(ii) $26,713.02 in interest; and

(b) the second applicant the sum of $120,083.37 comprised of the following:

(i) $98,650.53 in payment of the second applicant’s unpaid long service leave entitlement; and

(ii) $21,432.84 in interest.

7. Pursuant to s 546 of the FW Act, within 28 days of the date of these orders, the first respondent is to pay the following penalties to the first applicant:

(a) in respect of the Wollermann Bonus Payment Contravention, the amount of $13,320;

(b) in respect of the Wollermann Deduction Contravention, the amount of $133,200; and

(c) in respect of the Wollermann Pay Slip Contravention, the amount of $6,660.

8. Pursuant to s 546 of the FW Act, within 28 days of the date of these orders, the first respondent is to pay the following penalties to the second applicant:

(a) in respect of the Lyle Bonus Payment Contravention, the amount of $13,320; and

(b) in respect of the Lyle Pay Slip Contravention, the amount of $6,660.

9. Pursuant to s 546 of the FW Act, within 28 days of the date of these orders, the second respondent is to pay the following penalties to the first applicant:

(a) in respect of the Wollermann Bonus Payment Contravention, the amount of $2,664; and

(b) in respect of the Wollermann Deduction Contravention, the amount of $2,664.

10. Pursuant to s 546 of the FW Act, within 28 days of the date of these orders, the second respondent is to pay to the second applicant, in respect of the Lyle Bonus Payment Contravention, a penalty in the amount of $2,664.

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

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

In Wollermann v Fortrend Securities Pty Ltd [2025] FCA 103 (the principal judgment), I relevantly found that:(a)contrary to s 323(1) of the Fair Work Act 2009 (Cth) (the FW Act or the Act), Fortrend Securities Pty Ltd (Fortrend):(i)withheld bonus payments from Mr Wollermann and declined to pay him such amounts that had already been earned on termination (Wollermann Bonus Payment Contravention); and(ii)withheld bonus payments from Mr Lyle and declined to pay him such amounts that had already been earned on termination (Lyle Bonus Payment Contravention)(together, the Bonus Payment Contraventions);(b)contrary to s 323(1) of the Act, Fortrend unilaterally deducted amounts from Mr Wollermann’s monthly pay without authorisation under s 324 of the Act (Wollermann Deduction Contravention), which amounted to a serious contravention by Fortrend under s 557A(1) of the Act;(c)contrary to ss 536(1) and (2) of the Act: (i)Fortrend failed to provide pay slips to Mr Wollermann within one working day of being paid each month (or at all), and those that were provided were deficient (Wollermann Pay Slip Contravention); and(ii)Fortrend failed to provide pay slips to Mr Lyle within one working day of being paid each month (or at all), and those that were provided were deficient (Lyle Pay Slip Contravention)(together, the Pay Slip Contraventions); and(d)Mr Forster, the managing director of Fortrend, was “involved in” each of Fortrend’s above contraventions of the Act (other than in respect of the Pay Slip Contraventions) and was therefore liable as an accessory pursuant to s 550 of the Act for the Bonus Payment Contraventions and the Wollermann Deduction Contravention. I also found that Fortrend failed to pay the applicants their long service leave entitlements in accordance with the Long Service Leave Act 2018 (Vic), but that finding is not relevant to the question of penalties. I must now impose a penalty in respect of each of the breaches of the FW Act, and make final orders. I asked the parties to file written submissions on the issue, which they did. The applicants also sought to rely on a written penalty submission in reply dated 15 April 2025, which was filed with leave. Having considered them, I formed the view that it was an appropriate matter to decide on the papers. These reasons assume a familiarity with the principal judgment, and with my reasons in Fortrend Securities Pty Ltd v Wollermann (No 2) [2025] FCA 96, in which I dismissed the case brought by Fortrend against Mr Wollermann and Mr Lyle for alleged breaches of their equitable duties of confidence, their fiduciary duties and statutory obligations, and for their alleged breaches of contract. (This proceeding was originally issued in the Federal Circuit and Family Court of Australia, but it was transferred to this court and allocated to my docket because it was said to be sufficiently related to Fortrend’s claims against Mr Wollermann and Mr Lyle.)APPLICABLE LEGAL PRINCIPLES There was no dispute about the applicable legal principles.

Ratio Decidendi

Legal Principle Established

This relationship of “reasonableness” may be established by reference to the circumstances of the contravener as well as by the circumstances of the conduct involved in the contravention. See Pattinson at 472 [55]. CONSIDERATION OF PRELIMINARY ISSUESCourse of conduct Section 557 of the FW Act relevantly provides as follows:557 Course of conduct (1)For the purposes of this Part, 2 or more contraventions of a civil remedy provision referred to in subsection (2) are, subject to subsection (3), taken to constitute a single contravention if:(a)the contraventions are committed by the same person; and (b)the contraventions arose out of a course of conduct by the person. (2) The civil remedy provisions are the following:…(g) subsection 323(1) (which deals with methods and frequency of payment);…(o) subsections 536(1), (2) and (3) (which deal with employer obligations in relation to pay slips);… At [23]–[26] of its written penalty submissions dated 2 April 2025, the respondents submitted that, for the purposes of penalty, the court should treat both Bonus Payment Contraventions as constituting a single course of conduct and both Pay Slip Contraventions as constituting a separate, single course of conduct. Those submissions are misconceived for the reasons that follow. Dealing first with the Bonus Payments Contraventions, each of the Wollermann Bonus Payment Contravention and the Lyle Bonus Payment Contravention comprises the non-payment of commissions earned by an employee in May, June, July, August and October 2022. For each employee, each monthly non-payment of commission was sufficient to ground an individual contravention of s 323(1) of the FW Act. Fortrend committed each individual contravention against each employee, and those contraventions against that employee arose out of a course of conduct by Fortrend. Section 557(1) of the FW Act is therefore satisfied. It follows that the Wollermann Bonus Payment Contravention and the Lyle Bonus Payment Contravention should each be taken to constitute a single course of conduct — i.e. one in respect of Mr Wollermann and one in respect of Mr Lyle. However, it does not follow that those two courses of conduct — namely, the course of conduct which relates to the Wollermann Bonus Payment Contravention and that which relates to the Lyle Bonus Payment Contravention — should in turn be taken to constitute a single “Bonus Payment Contraventions” course of conduct. A critical feature of the contravening conduct was that it related to two distinct employees, and the penalties imposed on the respondents should reflect this fact. In any event, the single course of conduct principle is “a tool of analysis… which a court is not compelled to utilise”. See Construction, Forestry, Mining and Energy Union v Cahill[2010] FCAFC 39; (2010) 269 ALR 1 at 13 [41] (Middleton and Gordon JJ). “[E]ven if offences are properly characterised as arising from the one transaction or a single course of conduct, a judge is not obliged to apply concurrent terms if the resulting effective term fails to reflect the degree of criminality involved”. See Cahill at [42].