Workplace Ombudsman v Golden Maple Pty Ltd

[2009] FMCA 664

FEDERAL MAGISTRATES COURT OF AUSTRALIA

WORKPLACE OMBUDSMAN v GOLDEN MAPLE PTY LTD & ORS [2009] FMCA 664

INDUSTRIAL LAW – Penalty – admitted breach of civil penalty provision – consideration of factors relevant to penalty – course of conduct – whether more than one penalty sought.

Migration Act1958 (Cth)
Restaurant, Tearoom and Catering Workers Award 1979 (WA), cls.11(4) and 26
Workplace Relations Act 1996 (Cth), ss.3(c), (f), 182(1), 185(2), 235(2), 719(1), (2), (4), 728
Workplace Relations Amendment (Work Choices) Act 2005 (Cth)

ACCC v IPM Operation and Maintenance Loy Yang Pty Ltd (No. 2) [2007] FCA 11
ASC v Forem-Freeway Enterprises Pty Ltd & Ors (1999) 30 ACSR 339; [1999] FCA 179
Australian Ophthalmic Supplies v McAlary-Smith (2008) 165 FCR 560; [2008] FCAFC 8
Buckingham v KSN Engineering Pty Ltd (2008) 177 IR 427; [2008] FMCA 546
CFMEU v Austral Bricks (Qld) Pty Ltd (2009) 178 IR 470; [2009] FMCA 143
Commonwealth Bank of Australia & Anor v Finance Sector Union (2007) 157 FCR 329; [2007] FCAFC 18
Cotis v Macpherson (2007) 169 IR 30; [2007] FMCA 2060
Cotis v Pow Juice Pty Ltd [2007] FMCA 140
CPSU v Commonwealth (2007) 168 IR 107; [2007] FCA 1634
Curyer v Bizpro SA Pty Ltd [2009] FMCA 30
Fair Work Ombudsman v Primrose Developments Pty Ltd & Anor [2009] FMCA 632
Finance Sector Union v Commonwealth Bank of Australia (2005) 224 ALR 467; [2005] FCA 1847
Flattery v Italian Eatery t/as Zeffirelli’s Pizza Restaurant (2007) 163 IR 14; [2007] FMCA 9
Hanssen Pty Ltd v Jones (2009) 179 IR 57; [2009] FCA 192
Jones v Hanssen Pty Ltd [2008] FMCA 291
Kelly v Fitzpatrick (2007) 166 IR 14; [2007] FCA 1080
Leighton Contractors Pty Ltd v CFMEU (2006) 164 IR 375; [2006] WASC 317
Olsen v Sterling Crown Pty Ltd (2008) 177 IR 337; [2008] FMCA 1392
Ponzio v B&P Caelli Constructions Pty Ltd (2007) 158 FCR 543; [2007] FCAFC 65
Rajagopalan v BM Sydney Building Materials Pty Ltd [2007] FMCA 1412
Secretary, Department of Health & Ageing v Pagasa Australia Pty Ltd [2008] FCA 1545
Sharpe v Dogma Enterprises [2007] FCA 1550
Workplace Ombudsman v KSN Engineering Pty Ltd [2009] FMCA 538
Workplace Ombudsman v Saya Cleaning Pty Ltd & Anor [2009] FMCA 38
Workplace Ombudsman v Securit-E Holdings Pty Ltd & Ors [2009] FMCA 700

Applicant: WORKPLACE OMBUDSMAN

First Respondent: GOLDEN MAPLE PTY LTD

Second Respondent: CITYTEAM PTY LTD

Third Respondent: LAWRENCE CHIA

File Number: PEG 180 of 2008

Judgment of: Lucev FM

Hearing date: 23 April 2009

Date of Last Submission: 23 April 2009

Delivered at: Perth

Delivered on: 31 July 2009

REPRESENTATION

Counsel for the Applicant: Mr T Woodland

Solicitors for the Applicant: Clayton Utz

Counsel for the Respondents: Mr A O Karstaedt

Solicitors for the Respondents: James Chong Lawyers

ORDERS

1. The first respondent pay a penalty of $36,000 for:

   (a)contravention of s.185(2) of the Workplace Relations Act 1996 (Cth).

   (b)contraventions of s.182(1) of the Workplace Relations Act 1996 (Cth).

   (c)contravention of clause 11(4) of the notional agreement preserving State awards (Golden Maple NAPSA).

   (d)contravention of clause 26 of the Golden Maple NAPSA.

   (e)contravention of s.235(2) of the Workplace Relations Act 1996 (Cth).

2. The second respondent pay a penalty of $4,125 for the contravention of s.235(2) of the Workplace Relations Act 1996 (Cth).

3. The third respondent pay a penalty of $3,300 for his contraventions of s.182(1) of the Workplace Relations Act 1996 (Cth).

4. Payment of the penalties prescribed in orders (1), (2) and (3) be made to the Commonwealth Consolidated Revenue Fund by 4.00pm on 31 August 2009.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
PERTH

PEG 180 of 2008

WORKPLACE OMBUDSMAN

Applicant

And

GOLDEN MAPLE PTY LTD

First Respondent

CITYTEAM PTY LTD

Second Respondent

LAWRENCE CHIA

Third Respondent

REASONS FOR JUDGMENT

Application

1. This application by the Workplace Ombudsman alleges that the respondents contravened:

   a)various sections of the Workplace Relations Act 1996 (Cth);[1] and

   b)the applicable notional agreement preserving State awards.

   [1] “WR Act”.

2. The Workplace Ombudsman is seeking the imposition of pecuniary penalty orders pursuant to s.719(1) of the WR Act.

3. The third respondent[2] is a director of the first and second respondent companies,[3] which trade as Japanese restaurants in Perth, and he indirectly holds shareholdings of:

   a)70 percent in Golden Maple; and

   b)approximately 50 percent in CityTeam.[4]

   [2] “Mr Chia”.

   [3] “Golden Maple” and “CityTeam” respectively.

   [4] Transcript at page 6.

Consent declarations and orders

1. On 4 February 2009, the parties consented to the Court making the following declarations and orders:

   1. That in contravention of section 185(2) of the Workplace Relations Act 1996 (Cth) (the Act), the First Respondent failed to pay casual loading, as contained in the Australian Fair Pay and Conditions Standard, during the period from 25 June 2006 until 25 March 2007, on 30 occasions, in relation to each of the following employees:

   (a) A Reum AHN;

   (b) Chiho CHIHO;

   (c) Ayumi HASHIMOTO;

   (d) Yukari HORIUCHI;

   (e) Tomoko MINAMINO;

   (f) Kang NAHYE;

   (g) Eri OSHIMA;

   (h) Kana SAITO;

   (i) Uba SATOMI; and

   (j) Tomimura Christine TIEMI.

   2.  That in contravention of section 182(1) of the Act, the First Respondent failed to pay Akiko FALCONER and Fumiko MATSUDA the basic periodic rate of pay, on two occasions, for the first 20 hours of their employment in or around October and August 2006 respectively.

   3.  That the Third Respondent contravened section 728 of the Act, on 2 occasions, by virtue of his involvement in the contravention by the First Respondent identified in paragraph 2 above.

   4.  That the First Respondent breached the notional agreement preserving State awards (the Golden Maple NAPSA), derived from the provisions of clause 11(4) of the Restaurant, Tearoom and Catering Workers Award 1979 (WA) (Former State Award), during the period from 25 June 2006 until 25 March 2007, on 57 occasions, by failing to pay the following employees the penalty rates on the periodic rate of pay for each of the hours worked by its employees on Saturday, Sundays and public holidays:

   (a) A Reum AHN;

   (b) Chiho CHIHO;

   (c) Ayumi HASHIMOTO;

   (d) Yukari HORIUCHI;

   (e) Jukang HYUN;

   (f) Tomoko MINAMINO;

   (g) Kang NAHYE;

   (h) Eri OSHIMA;

   (i) Kana SAITO;

   (j) Uba SATOMI;

   (k) Min Ju SONG;

   (l) Fusa TAUCHI; and

   (m) Tomimura Christine TIEMI.

   5.  That the First Respondent breached the Golden Maple NAPSA derived from clause 26 of the Former State Award, during the period from 18 September 2006 until 31 March 2007, on 17 occasions, by failing to pay a laundry allowance to Akiko FALCONER and Fumiko MATSUDA.

   6. That in contravention of section 235(2) of the Act, the First Respondent failed to pay annual leave entitlements on termination of employment, between the period from about 12 June 2006 to 15 July 2007, on 28 occasions, in relation to the following employees:

   (a) Law Teck Chiun ANTONY;

   (b) Ruixue Karen CHEN;

   (c) Machiko DAIRAKU;

   (d) Eri GOTOH;

   (e) Jae Sonia HWA;

   (f) Kaori HYUGA;

   (g) Ju Park HYUNG;

   (h) Nahee JUN;

   (i) Rie KANAZAWA;

   (j) Kim KEONWOO;

   (k) Yuichi KIDOGUCHI;

   (l) Teramoto KUMI;

   (m) Midori KUSU;

   (n) Ando KYOKO;

   (o) Keon Seo KYOUNG;

   (p) Jihye Elley LIM;

   (q) Fumiko MATSUDA;

   (r) Azura MORISHIMA;

   (s) Yoko NAKANO;

   (t) Ayako OKADA;

   (u) Akiko OSAWA;

   (v) Cindy TJIE;

   (w) Tomoko Tomoko;

   (x) Kinichige URAWA;

   (y) Yukiko WAKAGURI;

   (z) Nao YASUDA;

   (aa) Shiota YASUYO; and

   (bb) Huang ZOE.

   7.  That in contravention of section 235(2) of the Act, the Second Respondent failed to pay annual leave entitlements on termination of employment, between the period from about 5 February 2007 to 27 May 2007, on two occasions, in relation to the following employees:

   (a) Yoshiko KONDO; and

   (b) Sim Sunny Sun HEE.

   FURTHER, by consent, the parties seek that the Court makes the following orders:

   8.  That the matter is adjourned to a hearing on penalty at 10.15am on 23 April 2009.

   9.  That the parties file and serve a Statement of Agreed Facts on or before 6 March 2009.

   10.    That the Applicant file and serve an Outline of Submissions in relation to penalty on or before 20 March 2009, those submissions to include one copy of each authority relied upon.

   11.    That the Respondents file and serve an Outline of Submissions in relation to penalty on or before 3 April 2009, those submissions to include one copy of each authority relied upon.

   12.    That the Applicant file and serve its Outline of Submissions in Reply, if any, on or before 15 April 2009.

   13.    That costs be reserved.

   14.    That the parties have liberty to apply for a directions hearing on 24 hours' notice.

Agreed facts

1. On 23 March 2009, the parties filed an amended statement of agreed facts,[5] in the following terms:

   [5] “Amended Statement of Agreed Facts”.

   1.  The Court has made declarations in respect of the contraventions by the Respondents in its Orders (Orders) made on 4 February 2009.

   INVESTIGATION

   2.  The Applicant became aware of the breaches as a result of the National Restaurant Targeted Campaign (Campaign) in January 2007. The purpose of the Campaign was to audit employment records of various restaurant businesses.

   3.  The First Respondent (Golden Maple) was included in the Campaign as a result of an allegation received from the Health Services Union, in about December 2006, alleging that Golden Maple employees were being underpaid.

   4.  The Applicant sent a request for employment records to Golden Maple and the Third Respondent (Mr Chia), on about 10 January 2007. The request was mailed to Habourtown [sic] City Central Shop 29b 840 Wellington Street Perth WA 6000. The Applicant did not receive a response to the request from Golden Maple or Mr Chia.

   5. From about 31 January 2007 to about 21 August 2007, pursuant to section 169(2) of the Workplace Relations Act 1996 (Cth) (Act), the Applicant served various Notice to Produce requests on Golden Maple, the Second Respondent (Cityteam) and Mr Chia. Golden Maple, Cityteam and Mr Chia subsequently cooperated with the Applicant by complying with the Notice to Produce requests, by responding to various communications with the Applicant and by paying underpayments calculated by the Applicant.

   6.  The Applicant concluded that Golden Maple and Cityteam had underpaid their employees.  On 5 October 2007, the Applicant issued a Breach Notice to Golden Maple and Cityteam.

   7.  The employment records provided by Golden Maple, Cityteam and Mr Chia did not provide details of the employees' classification.

   8.  During the period from about 27 March 2007 to about 11 December 2007, Golden Maple and Cityteam made payments to a number of its employees. Based on the records provided by Golden Maple, Cityteam and Mr Chia, the Applicant is satisfied all quantifiable underpayments have now been paid to the relevant employees. 

   GOLDEN MAPLE

   9.  During the relevant period from 12 June 2006 to 30 July 2007, Golden Maple ran a Japanese restaurant (Business) from:

   (a)     Unit B29, Harbour Town, 840 Wellington Street, Perth, Western Australia, trading as "Shimizu Harbour Town"; and

   (b)     Unit 4A, 166 Murray Street Mall, Perth, Western Australia, trading as “Shimizu Donabe & Bento”.

   10.    It had carried on this Business since about 29 January 2004 and still does.

   11.    During part of the relevant period referred to in paragraph 10 (from 25 June 2006 to 25 March 2007 - approximately 9 months):

   (a)     the gross revenue of the Business was $1,317,074.50;

   (b)     Golden Maple employed approximately 63 employees to work in the Business; and

   (c) of those 63 employees, approximately 20% were employed on a full-time basis, 75% on a part-time basis and 5% on a casual basis.

   12.    Golden Maple currently employs approximately 19 employees and its gross revenue for the 2007-08 financial year was $1,653,877.47.

   13.    Golden Maple has not been previously prosecuted in relation to breaches of a similar nature.

   14.    At various times between 27 March 2006 and 30 July 2007, Golden Maple employed each of the following persons (Golden Maple Casual Employees) to work in the Business:

Name	Approximate date of commencement of employment
(a) A Reum AHN	22 June 2006;
(b) Chiho CHIHO	22 August 2006;
(c) Ayumi HASHIMOTO	22 January 2007;
(d) Yukari HORIUCHI	29 May 2006;
(e) Jukang HYUN	31 July 2006;
(f) Tomoko MINAMINO	24 June 2006;
(g) Kang NAHYE	2 March 2007.
(h) Eri OSHIMA	15 December 2006;
(i) Kana SAITO	14 July 2006;
(j) Uba SATOMI	16 December 2006;
(k) Min Ju SONG	23 September 2006;
(l) Fusa TAUCHI	1 September 2006; and
(m) Tomimura Christine TIEMI	6 March 2007.

15. At all relevant times, Tomoko MINAMINO was on a student visa and was studying at a Tertiary Institution in Perth.

16. The following Golden Maple Casual Employees were in Australia on a temporary basis on a working holiday visa:

(a) A Reum AHN;

(b) Chiho CHIHO;

(c) Ayumi HASHIMOTO;

(d) Yukari HORIUCHI;

(e) Jukang HYUN;

(f) Kang NAHYE;

(g) Eri OSHIMA;

(h) Uba SATOMI;

(i) Min Ju SONG;

(j) Fusa TAUCHI; and

(k) Tomimura Christine TIEMI.

17. Kana SAITO, one of the Golden Maple Casual Employees was, at all material times, a permanent resident of Australia and a Junior employee, that is, someone less than 18 years of age.

18. At various times between 27 March 2006 and 30 July 2007, Golden Maple employed the following persons (Golden Maple Part-time/Full-time Employees) to work in the Business, on a part-time or full-time basis:

(a) Law Teck Chiun ANTONY;

(b) Ruixue Karen CHEN;

(c) Machiko DAIRAKU;

(d) Eri GOTOH;

(e) Jae Sonia HWA;

(f) Kaori HYUGA;

(g) Ju Park HYUNG;

(h) Nahee JUN;

(i) Rie KANAZAWA;

(j) Keonwoo KIM;

(k) Yuichi KIDOGUCHI;

(l) Teramoto KUMI;

(m) Midori KUSU;

(n) Ando KYOKO;

(o) Keon Seo KYOUNG;

(p) Jihye Elley LIM;

(q) Fumiko MATSUDA;

(r) Azura Morishima;

(s) Yoko NAKANO;

(t) Ayako OKADA;

(u) Akiko OSAWA;

(v) Cindy TJIE;

(w) Tomoko TOMOKO;

(x) Kinichige URAWA;

(y) Yukiko WAKAGURI;

(z) Nao YASUDA;

(aa) Shiota YASUYO; and

(bb) Huang ZOE.

19. The Golden Maple Part-time/Full-time Employees were in Australia on a temporary basis on working holiday visas. 

Applicable Industrial Instruments

20. Prior to 27 March 2006 (Reform Commencement Date), the Restaurant, Tearoom and Catering Workers Award 1979 (WA) (as amended) (Former State Award) applied to the Business of Golden Maple. 

21. After the Reform Commencement Date:

(a) a preserved Australian Pay and Classification Scale (Preserved Pay Scale) came into existence on the Reform Commencement Date, containing provisions derived from the terms of the Former State Award.

(b) a notional agreement preserving State awards came into operation on the Reform Commencement Date pursuant to clause 31 of Schedule 8 to the Act (Golden Maple NAPSA) also derived from the Former State Award.

22. The Preserved Pay Scale and the Golden Maple NAPSA applied to each of the Golden Maple Casual Employees and to each of the Golden Maple Part-time/Full-time Employees during the period 12 June 2006 until 30 July 2007.

The Preserved Pay Scale and the Golden Maple NAPSA: General provisions

23. Both the Preserved Pay Scale and the Golden Maple NAPSA contained provisions (derived from the Former State Award) for the classification of employees, as follows:

(a) Employees, including casual employees worked in classifications which included the following:

(i) Introductory;

(ii) Food & Beverage Attendant Grade 1; and

(iii) Food & Beverage Attendant Grade 2;

(b) Clause 6 of the Former State Award defined:

(i) an Introductory level employee to mean an employee who, inter alia, “...enters the industry and who has not demonstrated the competency requirements of level 1.  Such an employee will remain at this level for up to three months...”; 

(ii) Food and Beverage Attendant Grade 1 to mean an employee who, “...is engaged in any of the following:

(a) picking up glasses;

(b) emptying ashtrays;

(c) general assistance to food and beverage attendants of a higher grade not including service to customers;

(d) removing food plates;

(e) setting and/or wiping down tables;

(f) cleaning and tidying of associated areas";

(iii) a Food & Beverage Attendant Grade 2 to mean:

“...an employee who has not achieved the appropriate level of training and who is engaged in any of the following...

(c) undertaking general waiting duties of both food and/or beverage including cleaning of tables;

(d) receipt of monies;

(e) attending a snack bar;

(f) engaged on delivery duties”;

24. The duties of each of the Golden Maple Casual Employees included preparing food, cleaning, customer service and general kitchen maintenance.

25. Each Golden Maple Casual Employee performed the duties of an Introductory employee during the first three months of their employment, within the meaning of that expression in:

(a) the provisions of the Preserved Pay Scale derived from clause 6 of the Former State Award; and

(b) clause 21 of the Golden Maple NAPSA.

26. After the first three months of employment as an Introductory employee, the following Golden Maple Casual Employees performed the duties of a Food & Beverage Attendant Grade 1, within the meaning of that expression in the provisions of the Preserved Pay Scale derived from clause 6 of the Former State Award:

(a) A Reum AHN; and

(b) Kana SAITO.

27. After the first three months of employment as an Introductory employee, the following Golden Maple Casual Employees performed the duties of a Food & Beverage Attendant Grade 2, within the meaning of that expression in the provisions of the Preserved Pay Scale derived from clause 6 of the Former State Award:

(a) Chiho CHIHO;

(b) Yukari HORIUCHI; and

(c) Tomoko MINAMINO.

28. The Preserved Pay Scale contained provisions derived from:

(a) Clause 21 of the Former State Award which provided for the following minimum fortnightly rates of pay payable to full-time employees:

Classification	Fortnightly rate of pay (on and from 7 July 2005)	1/76th of the Fortnightly Rate
Introductory	$968.80	$12.75
Food & Beverage Attendant Grade 1	$1002.20	$13.19
Food & Beverage Attendant Grade 2	$1052.40	$13.85

(b) Clause 11(3) of the Former State Award which provided for hourly rates of pay for casual employees of not less that 1/76th of the fortnightly rate prescribed for the relevant classification;

(c) Clause 12(2) of the Former State Award which provided for the hourly rate of pay of part-time employees, being a pro-rata rate of 1/76th of the fortnightly rate prescribed by the relevant classification; and

(d) Clause 22 of the Former State Award provided for junior rates of pay for an Introductory employee, a Food & Beverage Attendant Grade 1, and a Food & Beverage Attendant Grade 2, being:

(i) 50% of the lowest adult rate for juniors aged under 16 years of age;

(ii) 60% of the lowest adult rate for juniors aged between 16 and 17 years of age;

(iii) 70% of the lowest adult rate for juniors aged between 17 and 18 years of age;

(iv) 80% of the lowest adult rate for juniors aged between 18 and 19 years of age; and

(v) 90% of the lowest adult rate for juniors aged between 19 and 20 years of age.

29. The Australian Fair Pay Commission (Fair Pay Commission) adjusted the basic classification wage applicable to the Preserved Pay Scale, pursuant to section 22 of the Act, which took effect on and from 1 December 2006, as follows:

Classification	Basic Hourly Rate
Introductory	$13.47
Food & Beverage Attendant Grade 1	$13.91
Food & Beverage Attendant Grade 2	$14.57

Failure to pay Casual Loading

30. The Preserved Pay Scale contained a provision, derived from Clause 11(4) of the Former State Award, which provided for a casual loading of 25 per cent in addition to the basic hourly rate of pay for all hours worked by a casual employee.

31. Golden Maple breached the Preserved Pay Scale by failing to pay casual loading during the period 25 June 2006 until 25 March 2007, as declared in Order 1 of the Orders and Schedule 1 to the Statement of Claim (Schedule 1).  The amount of the underpayments is calculated in Schedule 1 and totals $1,394.85.

Failure to pay Penalty Rates

32. The Golden Maple NAPSA contained a term derived from clause 11(4) of the Former State Award which provided, inter alia, for penalty rates of 25 per cent of the basic periodic rate of pay for all hours worked on Saturday and Sunday, and of 100 per cent of the basic periodic rate of pay for all hours worked on a Public Holiday by a casual employee in addition to the basic periodic rate of pay and casual loading of 25 per cent provided in the Preserved Pay Scale (the Golden Maple NAPSA Penalty Rate clause).

33. Golden Maple breached the Golden Maple NAPSA on 57 occasions, by failing to pay the Golden Maple Casual Employees the penalty rates on the periodic rate of pay for each of the hours worked by the employee on Saturday and Sunday, and/or on a Public Holiday in accordance with the Golden Maple NAPSA Penalty Rate clause, as declared in Order 4 of the Orders and Schedule 1.  The amount of the underpayment is calculated in Schedule 1 and totals $1,998.42.

Failure to pay Basic Periodic Rate of Pay

34. Golden Maple, by its agent Mr Chia, employed Akiko FALCONER (née MATSUOKA) as a waitress pursuant to an oral contract of employment, from about 6 October 2006 until about 31 March 2007, being 13 fortnights. 

35. Mr Chia said to Akiko FALCONER words to the effect, that she would not be paid for the first 20 hours of her employment because this was to be 'unpaid training'.  

36. In contravention of section 182(1) of the Act, Akiko FALCONER was not paid by Golden Maple for the first 20 hours of her employment (in about October 2006), as declared by Order 2 of the Orders. During this period Akiko FALCONER was in Australia on a temporary basis on a working holiday visa.

37. Golden Maple, by its agent Mr Chia, employed Fumiko MATSUDA as a waitress pursuant to an oral contract of employment, from about 18 September 2006 to 26 November 2006, being 5 fortnights.

38. Mr Chia said to Fumiko MATSUDA words to the effect, that she would not be paid for the first 20 hours of her employment because this was to be 'unpaid training'. 

39. In contravention of section 182(1) of the Act, Fumiko MATSUDA, who is a Golden Maple Part-time/Full-time Employee, was not paid by Golden Maple for the first 20 hours of her employment (in about September 2006), as declared by Order 2 of the Orders.  During this period Fumiko MATSUDA was in Australia on a temporary basis on a working holiday visa.  The amount of the underpayment was $255 (20 hours x $12.75, which is the minimum hourly rate of pay for an Introductory employee).

Failure to pay Uniform Allowance

40. The Golden Maple NAPSA contains a term equivalent to clause 26 of the Former State Award which provides that an employer requiring employees to wear a uniform shall cause such clothing to be laundered at the employer’s expense or otherwise pay the employee concerned $6.20 per fortnight worked as a laundry allowance or $3.10 per fortnight where the employee works fewer than 38 ordinary hours (Golden Maple NAPSA Uniform Allowance clause).

41. Golden Maple required Akiko FALCONER and Fumiko MATSUDA to wear uniforms while at work.

42. Golden Maple did not cause their uniforms to be laundered at its expense.

43. Golden Maple did not pay Ms Falconer the $6.20 laundry allowance on 3 occasions, and did not pay Ms Falconer the $3.10 laundry allowance on 9 occasions. 

44. Golden Maple did not pay Ms Matsuda the $6.20 laundry allowance on 1 occasion, and did not pay Ms Matsuda the $3.10 laundry allowance on 4 occasions.

45. Golden Maple breached the Golden Maple NAPSA on 17 occasions, as declared by the Court in Order 5 of the Orders.

Failure to pay Annual Leave

46. Each of the Golden Maple Part-time/Full Time Employees was entitled to accrue annual leave in accordance with section 232(2) of the Act, being 1/13 of the nominal hours worked for each 4 week period of continuous service.

47. Golden Maple breached section 235(2) of the Act, by failing to pay the Golden Maple Part-time/Full-time Employees accrued but untaken annual leave or pro-rata annual leave at the conclusion of their employment with Golden Maple, as declared in Order 6 of the Orders and Schedule 2 to the Statement of Claim (Schedule 2).  The amounts of the underpayments are calculated in Schedule 2 and total $6,839.41.

48. Section 235(2) is a term of the Australian Fair Pay and Conditions Standard.

CITYTEAM

49. During the relevant period (from 5 February 2007 to 23 July 2007):

(a) Cityteam's gross revenue was $302,866.12;

(b) Cityteam employed approximately 16 employees; and

(c) of those 16 employees, 6 were employed on a full-time basis and 10 were employed on a part-time basis.

50. Cityteam currently employs about 61 part-time employees and its gross revenue for the 2007-08 financial year was $1,007,176.23. 

51. Cityteam has not been previously prosecuted in relation to breaches of a similar nature.

52. During the period from 5 February 2007 to 23 July 2007, Cityteam employed the following persons (Cityteam Employees) to work in Golden Maple premises at Unit 4A, 166 Murray Street Mall, Perth Western Australia, in an area that had been leased by Cityteam from Golden Maple:

(a) Yoshiko KONDO; and

(b) Sim Sunny Sun HEE.

53. The Cityteam Employees were in Australia on a temporary basis on working holiday visas. 

54. Pursuant to section 232(2) of the Act, the Cityteam Employees were entitled to accrue annual leave, being 1/13 of the nominal hours worked for each 4 week period of continuous service.

55. Cityteam breached section 235(2) by failing to pay the Cityteam Employees accrued but untaken annual leave or pro-rata annual leave at the conclusion of their employment with Cityteam, as declared in Order 7 of the Orders and Schedule 3 to the Statement of Claim (Schedule 3).  The amount of the underpayment is calculated in Schedule 3 and totals $394.40.

MR CHIA

56. Mr Chia was at all material times (from 12 June 2006 to 30 July 2007) and remains,:

(a) a director of Golden Maple; and

(b) in charge of the day-to-day operations of Golden Maple.

57. Mr Chia was at all material times (from 5 February 2007 to 23 July 2007) and remains,:

(a) the director of Cityteam; and

(b) in charge of the day-to-day operations of Cityteam.

58. Mr Chia has not been previously prosecuted in relation to breaches of a similar nature.

59. Mr Chia personally made the arrangements with Akiko FALCONER and Fumiko MATSUDA about non-payment for the first 20 hours of their employment, as described at paragraphs 34 to 39 above.

60. The Court declared that he was involved in Golden Maple’s contraventions.

Affidavit evidence

1. Affidavit evidence was tendered at the hearing, without objection,[6] in the form of an affidavit from Mr Chia sworn 21 April 2009.[7] That affidavit dealt with matters additional to, or in clarification of, matters referred to in the Amended Statement of Agreed Facts. Relevant aspects of Mr Chia’s Affidavit are discussed below.

   [6] Transcript at page 3.

   [7] “Mr Chia’s Affidavit”.

Issues for determination

1. The issues that remain for determination by the Court are:

   a)whether, in respect of the breach of s.182(1) of the WR Act:

   i)the manner in which the contravention is pleaded and has been subsequently dealt with prevents the Workplace Ombudsman from contending for and the Court imposing, separate penalties. That is two penalty orders, not one; and

   ii)there is one contravention by each of Golden Maple and Mr Chia, or two; and

   b)what penalties ought to be imposed on the respondents for the admitted contraventions.

WR Act contravened

1. The contraventions of the WR Act to which the respondents consented to declarations being made about were, in summary, as follows:

   a)that Golden Maple failed to pay casual loading on 30 occasions in relation to 10 employees, over a nine month period, in contravention of s.185(2) of the WR Act;

   b)that Golden Maple and Mr Chia failed to pay the basic periodic rate of pay on two occasions in September and October 2006, in relation to two employees, for the first 20 hours of pay, in contravention of ss.182(1) and 728 of the WR Act;

   c)that Golden Maple failed to pay annual leave entitlements on 28 occasions, in relation to 28 employees, over a 13 month period, in contravention of s.235(2) of the WR Act; and

   d)that CityTeam failed to pay annual leave entitlements on two occasions, in relation to two employees, over a four month period, in breach of s.235(2) of the WR Act.

Notional agreement contravened

1. The contraventions of the notional agreement preserving State awards,[8] derived from the Restaurant, Tearoom and Catering Workers Award 1979 (WA),[9] to which the respondents consented to declarations being made about were, in summary, derived from two separate clauses of the Former State Award, as follows:

   a)Golden Maple failed to pay penalty rates on the periodic rate of pay on 57 occasions, in relation to 13 employees, over a nine month period, in breach of the Golden Maple NAPSA, derived from the provisions of cl.11(4) of the Former State Award; and

   b)Golden Maple failed to pay a laundry allowance on 17 occasions, in relation to two employees, over a seven month period, in breach of the Golden Maple NAPSA, derived from the provisions of cl.26 of the Former State Award.

   [8] “Golden Maple NAPSA”.

   [9] “Former State Award”.

Assessment of penalty – general considerations

1. The Court observed as follows in Jones v Hanssen Pty Ltd:

   6.  Based on a series of decided cases in the Federal Court and this Court there does not appear to be a dispute about the relevant considerations for assessment of penalty, which are as follows:

   a) the circumstances of the conduct (including deliberate defiance or disregard of the WR Act);

   b)      relevant record of civil penalty contraventions;

   c)  whether the contraventions are distinct or arise from a single course of conduct;

   d)      the consequences of the contravening conduct;

   e)  deterrence, both general and specific;

   f)  the objects of the WR Act;

   g) the size and financial resources of the contravener;

   h) co-operation with regulatory authorities;

   i)  the contravener’s contrition;

   j)  the size of the prescribed penalty, and any recent increases to that prescription; and

   k)  the totality principle.[10]

   [10] [2008] FMCA 291 at para.6 per Lucev FM (“Hanssen”). Hanssen was successfully appealed, and the penalty reduced, because this Court placed too much emphasis on the vulnerability of the employees to exploitation, rather than making findings of exploitation and articulating the actual detriment, which in the circumstances, was no greater than, and no different to that of, non-vulnerable employees. However the ordinary principles used to assess penalty were not criticised: Hanssen Pty Ltd v Jones (2009) 179 IR 57 at 68 and 74 per Siopis J; [2009] FCA 192 at paras.61 and 99 per Siopis J (“Hanssen Appeal”) and in any event are also uncontroversial: see, for example, Olsen v Sterling Crown Pty Ltd (2008) 177 IR 337; [2008] FMCA 1392 (“Sterling Crown”); CFMEU v Austral Bricks (Qld) Pty Ltd (2009) 178 IR 470; [2009] FMCA 143.

2. The considerations identified above are not exclusive.[11]

   [11] Sharpe v Dogma Enterprises [2007] FCA 1550 at para.11 per Gyles J (“Dogma Enterprises”); Australian Ophthalmic Supplies v McAlary-Smith [2008] 165 FCR 560 at 580 per Buchanan J; [2008] FCAFC 8 at para.91 per Buchanan J (“Australian Ophthalmic Supplies”).

Circumstances of the conduct

1. The contraventions occurred:

   a)on the part of Golden Maple between June 2006 and July 2007;

   b)on the part of CityTeam between February and May 2007;

   c)by Mr Chia on two occasions in September and October 2006.

2. Of the 44 employees affected by the contraventions:

   a)one, an employee of Golden Maple, was a permanent resident of Australia, and under 18 years of age; and

   b)of the remaining 43 employees:

   i)41 were employees of Golden Maple;

   ii)two were employees of CityTeam; and

   iii)all were temporary residents in Australia, one on a student visa and 42 on working holiday visas.[12]

   [12] Amended Statement of Agreed Facts at paras.14-19 and 52-53.

3. An employee on a working holiday or student visa might also be vulnerable, and open to exploitation by reason of their migration status,[13] but not as vulnerable as an employee whose migration status was dependent upon the ongoing support of their employer. An employee who does not speak English well may also be regarded as a vulnerable employee. Both the Workplace Ombudsman and the respondents accept that employees who are:

   a)under the age of majority; or

   b)in Australia as temporary residents on student or working holiday visas; or

   c)who do not speak English well,

   may be regarded as vulnerable, and the Court so finds.[14] An employee under 18 years of age is regarded as generally vulnerable and at risk of exploitation in employment because of the employee’s age.[15]

   [13] Workplace Ombudsman v Saya Cleaning Pty Ltd & Anor [2009] FMCA 38 at para.20 per Simpson FM (“Saya Cleaning”).

   [14] Applicant’s Outline of submissions on penalty at para.32 (“Applicant’s Submissions on Penalty”); Respondents’ Outline of submissions on penalty at para.13 (“Respondents’ Submissions on Penalty”).

   [15] Cotis v Pow Juice Pty Ltd [2007] FMCA 140 at para.57 per Lloyd-Jones FM (“Pow Juice”).

4. A finding of vulnerability does not of itself support findings that:

   a)the employees were exploited because of their vulnerability;[16] and

   b)any detriment suffered by the employees was an additional material detriment by reason of the employees’ vulnerability,[17] that is, additional to what would otherwise have been the case for an employee who was not vulnerable.

   [16] Hanssen Appeal IR at 67 per Siopis J; FCA at paras.56-58 per Siopis J.

   [17] Hanssen Appeal IR at 67-68 per Siopis J; FCA at paras.60-62 per Siopis J.

5. In the circumstances of this case there is no evidence, either direct or from which it may be inferred, to support an assertion that these employees were exploited by reason of their vulnerability, or suffered additional material detriment because of their vulnerability, on the grounds of age or migration status.

6. As to whether the two employees, Akiko Falconer (nee Matsuoka) and Fumiko Matsuda, were exploited by reason of the fact that they did not speak English well, the Amended Statement of Agreed Facts simply indicates that they were not to be paid for the first 20 hours of employment because this was to be unpaid training.[18] The Amended Statement of Agreed Facts does not deal with the English speaking capacity of those two employees at all. Mr Chia’s evidence concerning these two employees is as follows:

   “…This situation arose in circumstances where the people concerned were not proficient in English and lacked experience and we wanted to let them try out if they could handle the job before they were hired and to let them see if they could fit into the job. At the time we understood that they considered this to be fair and were in agreement with this. I now appreciate that this was a mistake and that the people concerned should have been paid for this initial period.”[19]

   [18] See paras.35 and 38 of the Amended Statement of Agreed Facts.

   [19] Mr Chia’s Affidavit at para.6. The evidence as to fairness and agreement is admissible on the basis that it reflects the basis of the understanding of Golden Maple and Mr Chia. It is not evidence of the fact that arrangements were fair or agreed.

7. Under cross-examination Mr Chia admitted that the two employees were not proficient in English,[20] but otherwise the cross-examination did not take the matter further than the content of Mr Chia’s Affidavit. In re-examination Mr Chia said that the two employees were told that he and Golden Maple did not know whether their English was proficient enough for them to handle the job and he had therefore asked them to “try out” for the two days and then if the employees thought that they could do the job they would be hired.[21]

   [20] Transcript at page 11.

   [21] Transcript at page 15.

8. In the circumstances, the Court does not consider that there is sufficient evidence to conclude that Golden Maple and Mr Chia sought to exploit these two vulnerable employees because of their lack of English proficiency. If anything, the evidence demonstrates that the “try out” was an endeavour to ascertain whether or not the two employees concerned had sufficient English to enable them to do the job, and were suitable for the work, and was not a deliberate attempt to exploit the two employees by obtaining unpaid work. Despite the fact that there was a deliberate breach, in the sense that Golden Maple and Mr Chia knew that the two employees were not being paid, that deliberate breach was not motivated by any desire to exploit the employees, but rather by a desire to see if they were suitable for employment in the longer term. Further, there is no additional material detriment by reason of the employee’s vulnerability, when compared to an employee without that vulnerability placed in the same position. Another person with a perfect command of English might equally have had a two day “try out” for no payment, and the contravention and the effect of it would be the same.[22] Finally, it can be inferred, from the fact that only two of the employees concerned were given a “try out” on this limited basis, that neither Golden Maple nor Mr Chia were persons whose general mode of operation was to deny employees wages, and obtain free service from those employees, by means of unpaid trial employment.

   [22] Hanssen Appeal IR at 68 per Siopis J; FCA at para.61 per Siopis J.

9. Therefore, although the employees concerned are generally employees who are regarded as vulnerable, there is no sufficient evidence in this case to conclude that they were exploited by reason of their vulnerability or that there was any other additional material detriment suffered by them by reason of their vulnerability than would have been the case for an employee without the vulnerability.

10. The respondents had at no stage obtained legal advice prior to the contraventions being brought to their attention by the Workplace Ombudsman. The respondents did have an accountant engaged to advise them on payroll systems and matters. The respondents admit that they did not have adequate systems in place to ensure compliance with the relevant requirements. Mr Chia conceded in his evidence in chief that the respondents had “[b]asically nothing” in place by way of systems for checking on their industrial law obligations to employees.[23] The respondents argue that they were ignorant of the law, not as an excuse, but as proof that they were not deliberately defying or disregarding the WR Act.[24] In further support of this argument, the respondents argued that they had insufficient accounting systems to keep up with the growing business.[25] The fact that the business of Golden Maple and CityTeam grew rapidly but the systems did not when a person was engaged to look after the systems, does not mitigate the contravening conduct. The fact that the person engaged to do so did not maintain the systems does not exculpate the respondents. There is no evidence that the respondents had any system of checks to ensure that the person concerned was performing the task.[26] It is one thing to employ a person to do a task; it is another to ensure that it is done. The responsibility for the latter ultimately falls on the respondents.

    [23] Transcript at page 7.

    [24] Respondents’ Submissions on Penalty at para.14.

    [25] Mr Chia’s Affidavit at para.5; Transcript at page 7.

    [26] Transcript at page 7. Cf. Sterling Crown IR at 347-348 per Lucev FM; FMCA at para.38 per Lucev FM.

11. The Workplace Ombudsman accepted that the respondents had not acted in deliberate defiance of the WR Act, but said that their actions in not paying the employees for their entitlements had been deliberate.[27]

    [27] Transcript at page 19.

1. The circumstances of the conduct, in summary, are that:

   a)in the case of the first respondent, it occurred over a relatively long period, namely, 13 months and on a significant number of occasions involving a significant number of employees;

   b)in the case of the second respondent, it occurred over a relatively short period of four months and involved only two employees;

   c)in the case of the third respondent, it occurred on two separate occasions 18 days apart and concerned two employees;

   d)in the case of the third respondent, involved him directly as a director of the first and second respondents and the person responsible for their day to day operation, and therefore a person ultimately responsible, in a practical sense, for the breaches by the first and second respondents;

   e)they involved employees who were vulnerable to exploitation by reason of their age, or residency status in Australia or inability to speak English well;

   f)they were deliberate, but not deliberately defiant of the objects or provisions of the WR Act or the Golden Maple NAPSA; and

   g)they occurred during a period of rapid business growth not matched by growth in the systems of the business, in circumstances where a person was engaged to advise on payroll systems and matters, but with no compliance checking systems in place.

Relevant record of civil penalty contraventions

1. There are no relevant previous civil penalty contraventions by any of the respondents. The respondents are therefore, and must be treated as, first time contraveners. In the absence of aggravating circumstances, the respondents would therefore ordinarily be entitled to a discount of 20-30 percent as first time contraveners.

Distinct or single course of conduct

1. Section 719 of the WR Act relevantly provides as follows:

   (1) An eligible Court may impose a penalty in accordance with the Division on a person if:

   (a) the person is bound by the applicable provision; and

   (b) the person breaches the provision.

   (2) Subject to subsection (3), where:

   (a) two or more breaches of an applicable provision are committed by the same person; and

   (b) the breaches arose out of a course of conduct by the person;

   the breaches shall, for the purposes of this section, be taken to constitute a single breach of that term.

   (4) The maximum penalty that may be imposed under subsection (1) for a breach of an applicable provision is:

   (a) 60 penalty units for an individual; or

   (b) 300 penalty units for a body corporate.

2. The parties agree that each of the following contraventions arose out of a single course of conduct, and therefore should each be treated as one contravention, in accordance with s.719(2) of the WR Act;

   a)Golden Maple’s breaches of s.185(2) of the WR Act;

   b)Golden Maple’s breaches of s.235(2) of the WR Act;

   c)Golden Maple’s breaches of cl.11(4) of the Former State Award;

   d)Golden Maple’s breaches of cl.26 of the Former State Award; and

   e)CityTeam’s breaches of s.235(2) of the WR Act.

3. The parties disagree as to the contraventions of s.182(1) of the WR Act by Golden Maple and Mr Chia. Mr Chia is liable for breach of s.182 of the WR Act by Golden Maple by virtue of his being a “person involved in a contravention of a civil remedy provision”,[28] who in his capacity as a director of Golden Maple:

   a)knew the essential facts of the contraventions;

   b)was knowingly concerned in the contraventions; and

   c)was an intentional participant in the contraventions,

   but did not know (and need not have known) that the matters in question constituted a contravention.[29]

   [28] WR Act, s.728(1).

   [29] Buckingham v KSN Engineering Pty Ltd (2008) 177 IR 427 at 438-439 per Lucev FM; [2008] FMCA 546 at paras.39-40 per Lucev FM.

4. The paragraphs of the Amended Statement of Agreed Facts relevant to the contraventions of s.182(1) of the WR Act are set out above.[30]

   [30] See paras.34-39 of the Amended Statement of Agreed Facts.

5. The Workplace Ombudsman submits that the contraventions of s.182(1) by Golden Maple and Mr Chia were two separate and distinct contraventions, whilst Golden Maple and Mr Chia argue that the contraventions arose out of a single course of conduct.

6. The Workplace Ombudsman argues that they are separate and distinct contraventions because it says:

   a)the arrangements were made at different times with different employees through separate conversations;

   b)the arrangement was not a blanket policy of Golden Maple, so each employee was singled out; and

   c)each arrangement occurred during a clearly identifiable and different timeframe.

7. The first contravention occurred for employment of the first employee between 18 September 2006 and 26 November 2006. The second contravention occurred for employment of the second employee between 6 October 2006 and 31 March 2007. In relation to the arrangements being made at different times, with different employees and through separate conversations, the Workplace Ombudsman relied on the Court’s decision in Saya Cleaning. In Saya Cleaning, the Court held that the two contraventions of s.182(1) of the WR Act were separate and distinct contraventions because the employees were engaged at quite different periods of time, such that the contraventions, whilst similar, did not arise out of the same course of conduct.[31]

   [31] Saya Cleaning at para.24 per Simpson FM.

8. Golden Maple and Mr Chia classify the course of conduct as follows:

   a)that the first 20 hours of employment would be unpaid training; and

   b)that both employees:

   i)were in Australia on a temporary basis on a working holiday visa;

   ii)commenced employment 18 days apart;

   iii)were introductory employees and the amount underpaid was the same; and

   iv)were spoken to by Mr Chia.[32]

   [32] Respondents’ Submissions on Penalty at para.17.

9. Golden Maple and Mr Chia rely on Cotis v Macpherson[33] in this regard, in which this Court found that a single course of conduct arose even though a number of contraventions were involved, including in relation to superannuation benefits extending over a period of about two years.[34] Cotis is of limited assistance as the facts set out in the judgment are brief,[35] but it appears to be distinguishable in that the breaches affected all employees employed by the employer, giving rise to a single course of conduct.[36] In this case, the breaches of s.182(1) of the WR Act were only in relation to two employees, indicating that they were specifically selected.

   [33] (2007) 169 IR 30; [2007] FMCA 2060 (“Cotis”).

   [34] Cotis IR at 41 per Driver FM; FMCA at para.15 per Driver FM.

   [35] Understandably, as the judgment was both ex tempore and ex parte.

   [36] Cotis IR at 39-41 per Driver FM; FMCA at paras.11 and 15 per Driver FM.

10. The attempt of Golden Maple and Mr Chia to characterise the conduct as a single course of conduct must, in the Court’s view, fail for the reasons set out below.

11. First, Golden Maple and Mr Chia stating that the first 20 hours of employment would be unpaid training, might be part of a single course of conduct if done for each and every employee who commenced employment, or if done simultaneously or en masse to a group of commencing employees. In this case, however, two employees were specifically singled out on account of their lack of English proficiency, and arrangements made with them separately and at different times.

12. Second, the fact that these two employees were temporarily in Australia on working holiday visas does not, of itself, constitute part of a course of conduct by Golden Maple and Mr Chia. Rather, it is a part of the visa scheme under the Migration Act1958 (Cth). In this case the nature of the visa held by each of the two employees was no different to the visa held by other employees employed by Golden Maple, whose first 20 hours were not unpaid, and who were employed before, during and after the two employees the subject of the contravention of s.182(1) of the WR Act.[37]

    [37] Amended Statement of Agreed Facts, paras.16, 18-19 and 34-39.

13. Third, the fact that the two employees commenced employment 18 days apart will not ordinarily, or alternatively, necessarily, be indicative of a single course of conduct. If anything, it is a fact which indicates a separate course of conduct, particularly when viewed in the context of:

    a)the employment of the two employees:

    i)commencing at different times;

    ii)finishing at different times; and

    iii)being of different lengths,[38] and

    b)the overall circumstances of this contravention.

    [38] Saya Cleaning at para.24 per Simpson FM.

14. Fourth, the fact that both were so-called “introductory employees” and both were underpaid the same amount does not assist Golden Maple and Mr Chia. Other employees were “introductory employees” and were not similarly dealt with by Golden Maple and Mr Chia. Further, the same facts might apply to two employees employed one, three, five or seven years after each other, and could hardly, in those circumstances, generally be said to represent one course of conduct.[39]

    [39] It might be different if all “introductory employees” were treated this way as a consequence of a single decision to do so, but this is not the case.

15. Fifth, the fact that both employees were spoken to by Mr Chia might be an indicator of one course of conduct, but its effect is outweighed by other factors discussed above, including the different commencement times for the two employees.

16. The applicant’s argument that the breaches concerning these two employees arise from more than a single course of conduct is more consistent with the facts. In particular, the Court finds that:

    a)the arrangements resulting in contravention were made at:

    i)different times;

    ii)with different employees; and

    iii)in different conversations;

    b)each of the two employees was specifically selected to be employed under the arrangements; and

    c)the arrangements with each employee lasted for different periods.

17. In Sterling Crown two separate requests for records were made, related to different requests at different times for different records for different periods for different people, with no overlap of circumstances. The Court held that the two contraventions were not in respect of the same action or same course of conduct by the respondent.[40]

    [40] IR at 350 per Lucev FM; FMCA at paras.49-50 per Lucev FM.

18. The Court considers that the judgments in Saya Cleaning and Sterling Crown are more closely related to the facts found in this case than the judgment in Cotis, and that the application of the principles outlined in the former two cases to the facts of this case leads to a conclusion that there were two courses of conduct in relation to the contraventions.

19. In light of the above, the Court finds that there were two separate and distinct breaches of s.182(1) of the WR Act, by Golden Maple and Mr Chia, arising from separate courses of conduct.

20. Golden Maple and Mr Chia however argue that the Court can not, or should not, order separate penalties for the s.182(1) contraventions, because only one pecuniary penalty order was sought in the statement of claim.

21. The critical issue is whether the case pleaded by the Workplace Ombudsman was of one or multiple contraventions of s.182(1) of the WR Act by each of Golden Maple and Mr Chia, or whether Golden Maple and Mr Chia were otherwise put on notice that multiple contraventions were alleged.[41]

    [41] CPSU v Commonwealth (2007) 168 IR 107 at 109 per Branson J; [2007] FCA 1634 at paras.6 and (especially) 9 per Branson J (“CPSU”).

22. The application filed 26 November 2008 relevantly sought final orders as follows:

    THAT a pecuniary penalty order be imposed on the First Respondent pursuant to section 719(1) of the Act in respect of its failure to pay Akiko Falconer and Fumiko Matsuda the basic periodic rate of pay for the first 20 hours of their employment during October and August 2006 respectively, contrary to section 182(1) of the Act.

    THAT a pecuniary penalty order be imposed on the Third Respondent, pursuant to section 719(1) of the Act, by virtue of his involvement in the contravention by the First Respondent identified in paragraph 2 above, pursuant to section 728 of the Act.

    The application, on its face, refers to a single contravention by each of Golden Maple and Mr Chia.

23. The statement of claim, also filed 26 November 2008, provided as follows:

    Breach of section 182(1) of the Act - Unpaid Work

    18. In or about October 2006, the First Respondent, by its agent the Third Respondent, employed Akiko FALCONER (née MATSUOKA) as a waitress pursuant to an oral contract of employment.

    19. The First Respondent breached section 182(1) of the Act by failing to pay Ms Falconer the basic periodic rate of pay for work performed by the employee for the first 20 hours of her employment. Section 182(1) of the Act is a term of the Australian Fair Pay and Conditions Standard. Pursuant to section 719 of the Act, the Court may impose a penalty in respect of those breaches.

    20. In or about August 2006, the First Respondent employed Fumiko MATSUDA  as a waitress pursuant to an oral contract of employment.

    21. The First Respondent breached section 182(1) of the Act by failing to pay Ms Matsuda the basic periodic rate of pay for work performed by the employee for the first 20 hours of her employment. Section 182(1) of the Act is a term of the Australian Fair Pay and Conditions Standard. Pursuant to section 719 of the Act, the Court may impose a penalty in respect of those breaches.

    …

    The Third Respondent

    46. At all material times, the Third Respondent was involved in contravening the Act by the First Respondent pleaded at paragraphs 18 to 21 of this statement of claim, within the meaning of that expression in section 728 of the Act in that he:

    (a) entered into the contract of employment with Ms Falconer as pleaded in paragraph 17;

    (b) informed Ms Falconer that the first 20 hours of her employment would be ‘unpaid training’;

    (c) was a director of the First Respondent at all material times; and

    (d) was in charge of the day-to-day operations of the First Respondent.

    47. By virtue of section 728 of the Act, the Third Respondent is treated as having contravened section 182(1) of the Act.

    Relief Sought

    48. The Applicant claims the relief specified in the application.

24. In the Court’s view on an ordinary reading of the Statement of Claim it is apparent that multiple (two) contraventions of s.182(1) of the WR Act by each of Golden Maple and Mr Chia were pleaded, notwithstanding that in the particulars referred to in relation to Mr Chia the facts of only one of the pleaded contraventions are set out.

25. Declarations 2 and 3 of the consent declarations and orders[42] made on 4 February 2009 set out above indicate that there were “two occasions” on which Golden Maple acted in contravention of s.182(1) of the WR Act, and two occasions on which Mr Chia was involved in Golden Maple’s contravention. That is sufficient to warrant a finding that penalty orders are being sought in respect of two contraventions by each of Golden Maple and Mr Chia. That conclusion is supported by the Amended Statement of Agreed Facts filed on 23 March 2009 which sets out two separate contraventions.[43]

    [42] Set out above at para.4.

    [43] See paras.36 and 39 of the Amended Statement of Agreed Facts.

26. The Court therefore finds that both the consent declaration agreed by the parties and made by this Court, and the Amended Statement of Agreed Facts, set out two contraventions of s.182(1) of the WR Act by Golden Maple which Mr Chia was involved in, and in respect of which separate penalties were sought. The submissions filed by the Workplace Ombudsman on 24 March 2009 made it clear that two contraventions were alleged,[44] and this was reinforced at the hearing.[45]

    [44] Applicant’s Submissions on Penalty, paras.5(c), 35 and 36.

    [45] CPSU IR at 109 per Branson J; FCA at para.9 per Branson J.

27. In all the circumstances, the combination of the Statement of Claim, consent declarations, Amended Statement of Agreed Facts and the Applicant’s Submissions on Penalty, squarely put Golden Maple and Mr Chia on notice that two contraventions of s.182(1) of the WR Act were alleged in relation to each of them. The respondents’ contention that there was only one contravention of s.182(1) by each of Golden Maple and Mr Chia cannot be sustained.

Consequences of the contravening conduct

1. Because the declarations are admissions of each of the contraventions and the elements of those contraventions, the consequences of the contravening conduct must be that:

   a)Golden Maple:

   i)(A)    failed to pay casual loading as contained in the Australian Fair Pay and Conditions Standard on 30 occasions to ten employees over a nine month period; and

   (B)the amount of the non-payments was $1394.85;

   ii)(A)    failed to pay two employees the basic periodic rate of pay on two occasions in 2006; and

   (B)    the amount of the non-payments was $510.00;

   iii)(A)    contravened the Golden Maple NAPSA by failing to pay penalty rates on 57 occasions to 13 employees over a period of nine months in 2006/2007; and

   (B)the amount of the non-payments was $1998.42;

   iv)(A)    contravened the Golden Maple NAPSA by failing to pay laundry allowance on 17 occasions to two employees over a six month period; and

   (B)the amount of the non-payments was $65.10;

   v)(A)    in contravention of the WR Act failed to pay annual leave entitlements on termination of employment on 28 occasions to 28 employees over a 13 month period; and

   (B)    the amount of the non-payments was $6839.41;

   b)i)      CityTeam in contravention of the WR Act failed to pay annual leave entitlements on termination of employment on two occasions to two employees over a period of slightly longer than three months; and

   ii)the amount of the non-payments was $394.40;

   c)i)      Mr Chia was involved in the contravention by Golden Maple in relation to failure to pay the basic periodic rate of pay on two occasions to two employees in 2006; and

   ii)the amount of the non-payments was $510.00.[46]

   [46] This is the same amount as in sub-para.a)(ii)(B).

2. The consequences of the contravening conduct in this case involved loss to employees who were entitled to payments under the WR Act and Golden Maple NAPSA in the amounts set out above. The total amount of the non-payments by Golden Maple ($10,807.78) and CityTeam ($394.40) needs to be borne in mind. It is not large in Golden Maple’s case, and is very small in CityTeam’s case. However, Golden Maple’s conduct must be considered in the context that for individual low income earners[47] some of the sums involved are not insignificant. For example, two employees (Antony and Kuso) were not paid annual leave in excess of $800 each, and one employee was not paid annual leave in excess of $1,700 (Urawa).

   [47] The relevant hourly rates ranged from $12.75 to $14.57 over the periods concerned: Amended Statement of Agreed Facts at paras.28-29.

3. The non-payments are (notwithstanding the amounts) conduct undermining the utility and effectiveness of fundamental objects and purposes of the WR Act,[48] and in particular, the ensuring of compliance with minimum standards in relation to employee entitlements and the provision of an economically sustainable safety net of minimum wages and conditions for employees whose employment is regulated under the WR Act.[49] The consequences of the contravening conduct are therefore serious, because the conduct undermines the utility and effectiveness of the fundamental objects and purposes of the WR Act.

   [48] Hanssen at para.29 per Lucev FM: “conduct … unchecked … might undermine some of the statutory objects and purposes of the WR Act.” See also Secretary, Department of Health & Ageing v Pagasa Australia Pty Ltd [2008] FCA 1545 at para.56 per Flick J (“Pagasa”).

   [49] See WR Act, s.3(c) and (f) set out at para.64 below.

1. Golden Maple, by reason of the number of employees involved in the breaches, has engaged in conduct the consequences of which are far more wide reaching than that of CityTeam. The consequences of Mr Chia’s conduct are arguably more serious, because he was practically responsible, in an operational sense, for the conduct of the other respondents.

General and specific deterrence

1. A primary objective of penalties is deterrence.[50] Therefore, in imposing civil penalties, deterrence is a significant consideration.[51] It is assumed that an appropriate penalty will act as a deterrent to others who might be likely to offend.[52] Therefore it must be of a kind that demonstrates an appropriate assessment of the seriousness of the offending conduct.[53]

   [50] Kelly v Fitzpatrick (2007) 166 IR 14 at 21 per Tracey J; [2007] FCA 1080 at para.28 per Tracey J (“Kelly”); Leighton Contractors Pty Ltd v CFMEU (2006) 164 IR 375 at 391 per Le Miere J; [2006] WASC 317 at para.74 per Le Miere J; Sterling Crown IR at 351 per Lucev FM; FMCA at para.53 per Lucev FM.

   [51] Ponzio v B&P Caelli Constructions Pty Ltd (2007) 158 FCR 543 at 577 per Jessup J; [2007] FCAFC 65 at para.164 per Jessup J (“Ponzio”).

   [52] Ponzio 158 FCR 543 at 559 per Lander J; [2007] FCAFC 65 at para.93 per Lander J, citing Yardley v Betts (1979) 22 SASR 108; Kelly IR at 21 per Tracey J; FCA at para.28 per Tracey J.

   [53] Ponzio 158 FCR 543 at 559 per Lander J; [2007] FCAFC 65 at para.93 per Lander J.

2. Civil penalties imposed in industrial law proceedings must be meaningful and consistent in light of other considerations to be taken into account when determining appropriate penalty,[54] and are no longer to be approached by the Courts with a light hand. In that regard in Sterling Crown this Court observed that:

   The Federal Court has suggested, against a background of increased penalties in the WR Act, that the imposition of civil penalties in industrial law proceedings is no longer to be approached with a light hand, and that it might be appropriate for penalties under the WR Act to rise appreciably. The more heavy handed approach applies particularly where breaches are serious, wilful and ongoing.[55]

   [54] ACCC v IPM Operation and Maintenance Loy Yang Pty Ltd (No. 2) [2007] FCA 11 at para.66 per Young J; Sterling Crown IR at 351 per Lucev FM; FMCA at para.54 per Lucev FM.

   [55] Sterling Crown IR at 346 per Lucev FM; FMCA at para.32 per Lucev FM, citing Finance Sector Union v Commonwealth Bank of Australia (2005) 224 ALR 467 at 487 per Merkel J; [2005] FCA 1847 at para.72 per Merkel J; Commonwealth Bank of Australia & Anor v Finance Sector Union (2007) 157 FCR 329 at 364 per Branson J; [2007] FCAFC 18 at para.192 per Branson J.

3. The Workplace Ombudsman argues that the need for general deterrence is particularly high in industries such as the restaurant industry, where potentially vulnerable employees are often engaged.[56] The parties accept that these employees can be considered vulnerable.[57]

   [56] Applicant’s Submissions on Penalty at para.28.

   [57] See para.14 above.

4. The Court finds that the need for general deterrence is a significant factor in determining penalty in this case, given that potentially vulnerable employees, particularly those who are young, low paid, migrants or with poor English, are often engaged in the restaurant industry.[58]

   [58] Rajagopalan v BM Sydney Building Materials Pty Ltd [2007] FMCA 1412 at para.31 per Driver FM; Curyer v Bizpro SA Pty Ltd [2009] FMCA 30 at para.32 per Simpson FM. And see Flattery v Italian Eatery t/as Zeffirelli’s Pizza Restaurant (2007) 163 IR 14 at 29 per Mowbray FM; [2007] FMCA 9 at para.66 per Mowbray FM (“Italian Eatery”), where it was said: “In my view a clear message needs to be sent to both the Italian Eatery and the industry in general that underpayment of wages will not be tolerated.”

5. In relation to specific deterrence, the Court must assess the risk of the respondents re-offending, bearing in mind that the businesses run by Golden Maple and CityTeam continue to operate.[59]

   [59] Ponzio 158 FCR 543 at 559-560 per Lander J; [2007] FCAFC 65 at para.93 per Lander J.

6. The respondents argue that specific deterrence should not be taken into account as a factor in determining penalty in this case because the respondents have:

   a)at an early stage, accepted responsibility and liability for the contraventions;

   b)co-operated with all of the applicant’s requests;

   c)paid all underpayments owing to the relevant employees; and

   d)engaged Employment Services and Solutions Australia Pty Ltd (“ESSA”) to ensure that they comply with their industrial law obligations in the future.

7. The Court generally accepts the respondents’ arguments that they have acted in the manner described above. The respondents have acted in a manner which would suggest that they are unlikely to contravene again. Although the conduct was deliberate, it was not defiant, has been remedied and does not appear to have continued. Therefore, the Court finds that specific deterrence, whilst a consideration in determining penalty in this case, is not one which “loom[s] large”.[60]

   [60] Respondents’ Submissions on Penalty at paras.21-22; see also Kelly IR 14 at 21 per Tracey J; FCA at para.28 per Tracey J, where the Federal Court stated that specific deterrence did not loom large as a consideration in determining penalty because the respondents expressed contrition and had put in place mechanisms designed to ensure that there would be no repetition of the breaches which had led to the proceeding.

The objects of the WR Act

1. In assessing the seriousness of the respondents’ conduct, and what the level of penalty might be, the Court must have regard to the statutory purposes of the WR Act.[61]

   [61] Hanssen at para.29 per Lucev FM. See also Pagasa at para.56 per Flick J.

2. The objects of the WR Act are set out in s.3, and relevantly include the following:

   c)  providing an economically sustainable safety net of minimum wages and conditions for those whose employment is regulated by this Act; and

   f)  ensuring compliance with minimum standards, industrial instruments and bargaining processes by providing effective means for the investigation and enforcement of:

   i)   employee entitlements; and

   ii) the rights and obligations of employers and employees, and their organisations; and …[62]

   [62] WR Act, s.3(c) and (f)(i) and (ii).

3. Since the introduction of major reforms to the WR Act in 2005,[63] the courts have put more emphasis on the importance of employers complying with their obligations, including minimum standards of employment, and being responsible for their conduct, in the context of a more devolved and deregulated workplace relations environment under the provisions of the WR Act.[64] The maximum amount of penalties has increased significantly.[65]

   [63] Workplace Relations Amendment (Work Choices) Act 2005.

   [64] Pow Juice at para.63 per Lloyd-Jones FM; Hanssen at para.28 per Lucev FM.

   [65] See para.57 above, and the authorities there cited.

4. In the context of the objects of the WR Act requiring compliance with minimum standards and facilitating enforcement of the WR Act and industrial instruments,[66] a long period of deliberate (but not defiant) contravention involving dozens of employees by Golden Maple is serious, because it involved an undermining of the statutory objects and purposes of the WR Act, and particularly s.3(c) and (f)(i). In that context it is conduct that in this case warrants a meaningful penalty. The conduct of CityTeam and Mr Chia, for a lesser number of contraventions and over a lesser period still warrants a meaningful penalty in this context.

   [66] See the relevant WR Act provisions at para.64 above.

The size and financial resources of the contravener

1. As at 23 March 2009 Golden Maple employed approximately 19 employees. The first respondent’s gross revenue for the 2007-2008 financial year was $1,653,877.47.[67] As at 23 March 2009 CityTeam employed about 61 part-time employees. Its gross revenue for the 2007-2008 financial year was $1,007,176.23.[68] Mr Chia’s unchallenged evidence was that profit in the 2007-2008 financial year was in the region of 10 to 15 percent of gross revenue for the businesses.[69]

   [67] Amended Statement of Agreed Facts at para.12.

   [68] Amended Statement of Agreed Facts at para.50.

   [69] Transcript at page 7.

2. Mr Chia is a director of, and is responsible for the day-to-day operations of both Golden Maple and CityTeam.[70] There is no evidence as to his financial position.

   [70] Amended Statement of Agreed Facts at paras.56-57.

3. The Workplace Ombudsman submits that there should be no reduction in the quantum of any penalties on account of the size or financial resources of the respondents. The respondents argue that any penalty should not be increased because of a contravener’s “conceived or supposed” ability to pay.[71]

   [71] Transcript at page 40; Respondents Submissions on Penalty at para.28.

4. The size of the businesses should not affect their obligations to comply with the WR Act.[72] It is however appropriate to take into account the contravener’s size and financial resources, including their capacity to pay, in determining the quantum of any penalty.[73]

   [72] Kelly IR at 21 per Tracey J; FCA at para.28 per Tracey J; see Applicant’s Submissions on Penalty at para.52.

   [73] Sterling Crown IR at 356 per Lucev FM; FMCA at para.76 per Lucev FM applied in Fair Work Ombudsman v Primrose Developments Pty Ltd & Anor [2009] FMCA 632 at paras.73 and 79 per O’Sullivan FM. See also Workplace Ombudsman v KSN Engineering Pty Ltd [2009] FMCA 538 at para.13 per Lucev FM; Dogma Enterprises at para.15 per Gyles J.

5. There is no evidence that any of the respondents are in financial difficulty. There is nothing to suggest that penalties at an appropriate and meaningful level for a small to medium business and the director of such a business, will harm the businesses, or Mr Chia personally, or that it would be a “pointless exercise”,[74] or result in unemployment or non-payment of other entitlements.[75] There is, therefore, no reason associated with the size and financial resources of the respondents for the Court to adopt other than a normal approach to the setting of penalties.

   [74] ASC v Forem-Freeway Enterprises Pty Ltd & Ors (1999) 30 ACSR 339 at 352 per Madgwick J; [1999] FCA 179 at para.54 per Madgwick J.

   [75] Sterling Crown IR at 356 per Lucev FM; FMCA at para.75 per Lucev FM.

Co-operation with regulatory authorities

1. The Workplace Ombudsman says that the respondents have not co-operated fully with their requests, and in particular:

   a)did not immediately respond to an initial request for employment records; and

   b)took several months to pay the unpaid entitlements.

2. The Workplace Ombudsman argues that it was only after the applicant served notices to produce on the respondents that they began to co-operate with requests for employment records.[76]

   [76] Applicant’s Submissions on Penalty at paras.54-55.

3. Golden Maple argues that the initial request for employment records was sent to the wrong address, and therefore not received by them. An initial request by the Workplace Ombudsman for employment records was mailed to “Habourtown [sic] City Central Shop 29b 840 Wellington Street Perth WA 6000”.[77] No response was received by the applicant. Mr Chia stated that the request was not received by him or Golden Maple, and that the address as stated in the Amended Statement of Agreed Facts is the incorrect address for Golden Maple.[78] In examination-in-chief and re-examination, Mr Chia confirmed that there was no City Central Shop 29B.[79]

   [77] Amended Statement of Agreed Facts at para.4.

   [78] Mr Chia’s Affidavit at para.8.

   [79] Transcript at pages 6 and 16.

4. The Court accepts that the initial request for employment records was not likely to have been received by Golden Maple or Mr Chia, taking into account the evidence that:

   a)the address was wrong; and

   b)requests made by the Workplace Ombudsman since the initial request was made have been complied with.

5. The Workplace Ombudsman acknowledges that the respondents’ admissions of the contraventions have avoided the unnecessary expense, time and effort associated with a lengthy trial.[80]

   [80] Applicant’s Submissions on Penalty at para.57.

6. Golden Maple and CityTeam repaid all outstanding monies owed over a period of approximately eight and a half months.[81]

   [81] See Amended Statement of Agreed Facts, at para.8.

7. The Court finds that the respondents’ level of co-operation with the regulatory authorities is such that it entitles them to a reasonably significant penalty reduction in the order of 20-30 percent. The Court also recognises that there is potential for overlap between the factors of co-operation and contrition.

Contrition

1. The parties disagree on this point. The Workplace Ombudsman submits that the respondents have shown no contrition. The respondents argue that they have shown contrition.

2. The Workplace Ombudsman argues that acceptance of responsibility at an early stage, and co-operation with the applicant does not amount to contrition, and that there is no direct evidence of any contrition.

3. The respondents argue that the following are evidence of contrition and a willingness to facilitate the course of justice:

   a)acceptance of responsibility and liability for the contraventions at an early stage;

   b)co-operation in reaching agreement with the applicant on the facts which establish the contraventions;

   c)engaging ESSA to assist the respondents in ensuring compliance, and putting measures in place to ensure compliance in the future; and

   d)payment of all amounts owing to the employees concerned.[82]

   [82] Respondents’ Submissions on Penalty at paras.30-31.

4. There is direct evidence that Mr Chia regrets and apologises for what has occurred. On two occasions in the witness box, Mr Chia stated that he regretted what had happened, and on one of those occasions said he was sorry.[83] Given that Mr Chia effectively controlled Golden Maple and CityTeam, his expression of regret and sorrow must also be attributed to them.

   [83] See Transcript at pages 12 (cross-examination: “We regret that that’s happened.”) and 15 (re-examination: “We regret and we are sorry that that has happened.”)

5. In the Court’s view, the respondents have shown contrition, taking into account:

   a)each of the matters referred to above put forward in argument by the respondents as evidence of contrition;[84] and

   b)the expressions of regret and sorrow by Mr Chia whilst in the witness box, which can be taken as an expression of regret by all of the respondents.

   [84] See para.81 above.

6. The respondents’ expressions of contrition entitle them to a discount on penalty, again in the vicinity of 20-30 percent. Again, it has to be recognised that there is potential for overlap between the factors of contrition and co-operation.

The size of the prescribed penalty and any recent increases to that prescription

1. Under s.719 of the WR Act the maximum penalty for breaches of ss.182, 185 and 235 of the WR Act, and cls.11 and 26 of the Former State Award, is $33,000 for a body corporate, and $6,600 for an individual.

2. These penalties are the result of a marked increase in penalties following legislative reforms in 2005.[85] Any penalty in this case must take account of the increased penalties prescribed by Parliament.

   [85] See para.65 above.

The totality principle

1. The totality principle involves the consideration, by an approach of instinctive synthesis, of whether or not the overall penalty is just and appropriate.[86]

Consideration of penalty

[86] Australian Ophthalmic Supplies FCR at 567-568 per Gray J and 577 per Graham J; FCAFC at paras.27-28 per Gray J and para.78 per Graham J; Hanssen at para.49 per Lucev FM.

Generally

1. In general terms consideration of the factors set out above indicates that a penalty discount of between 60 to 90 percent is likely to apply to each of the contraventions by each of the respondents in these proceedings. However, in assessing penalty, it is necessary to have regard to each class of contravention separately.[87]

   [87] Hanssen Appeal IR at 74 per Siopis J; FCA at para.97 per Siopis J.

2. There was a submission on behalf of the respondents that no penalty ought to be imposed for some or all of the contraventions. Given the nature of the contraventions, and the seriousness with which the Parliament has indicated they ought to be treated (particularly by its increase in penalties in 2005), the Court does not consider that any of the contraventions are appropriate cases for the imposition of no penalty. Indeed, it is likely to rarely be the case that deliberate contraventions, or contraventions over a lengthy period of time, of statutory and award entitlements will result in the imposition of no penalty.

Golden Maple

1. The contravention of s.185(2) of the WR Act by failing to pay a casual loading on 30 occasions to 10 employees over a nine month period with the non-payments amounting to $1,394.84 constitutes a serious contravention over a lengthy period in relation to a number of employees (not small but not large). Having regard to all of the factors set out in these Reasons for Judgment, and accepting that a penalty discount generally in the range of 60 to 90 percent is appropriate, the Court considers that a penalty discount for this contravention of 75 percent is in order, resulting in a penalty imposed of $8,250 for the contravention of s.185(2) of the WR Act.

2. The two contraventions of s.182(1) of the WR Act by failing to pay two employees the basic periodic rate of pay on two occasions in 2006, in the amount of $510, is a serious breach because it entails a total non-payment of the employees concerned. However, there are only two employees, there are only two occasions on which it occurred, and the circumstances in which it occurred were such that it is clear that Golden Maple was not attempting to exploit the employees’ non-English speaking vulnerabilities. Again, accepting the 60 to 90 percent penalty discount range as applicable to those contraventions, the Court considers that a penalty discount of 80 percent ought to apply, resulting in a penalty of $6,600 for each contravention of s.182(1) of the WR Act. That is, a total of $13,200 for the two contraventions.

3. In relation to the contravention of clause 11(4) of the Golden Maple NAPSA by failing to pay penalty rates on 57 occasions to 13 employees over a period of nine months in 2006 and 2007, with a total non-payment of $1998.42, the Court considers that the same considerations apply as applied in respect of the contravention of s.185(2) of the WR Act set out above, and therefore a penalty discount of 75 percent is appropriate. This results in a penalty of $8,250 for the contravention of clause 11(4) of the Golden Maple NAPSA.

4. The contravention of clause 26 of the Golden Maple NAPSA by failing to pay laundry allowance on 17 occasions to two employees over a six month period with a total amount of $65.10 not being paid appears to the Court to be the least serious of all of the contraventions, involving only two employees and a small amount of underpayment, albeit over a reasonably lengthy period and on a number of occasions. Again accepting the 60 to 90 percent penalty discount range as being appropriate, the Court considers that a 90 percent penalty discount is appropriate for this contravention, resulting in a penalty of $3,300 for contravention of clause 26 of the Golden Maple NAPSA.

5. In relation to the contravention of s.235(2) of the WR Act by failure to pay annual leave entitlements on termination of employment on 28 occasions to 28 employees over a thirteen month period, the Court considers that this is a serious contravention by reason of the number of employees concerned, the amount of the non-payments (being $6,839.41) and the lengthy period involved. Again, accepting a general penalty discount range of 60 to 90 percent as being appropriate, the Court considers that a penalty discount of 65 percent ought to apply to this contravention, resulting in a penalty of $11,550 for breach of s.235(2) of the WR Act.

1. There remains to apply the totality principle in respect of the penalty imposed for the various contraventions. The total penalty in respect of all of the contraventions by Golden Maple is $44,550. Having regard for the total amount of underpayments ($10,807.78) by Golden Maple a penalty approaching $45,000 does, instinctively, seem a little large, and although this is a case in which general deterrence is a significant factor, a slightly lesser penalty would still have the requisite general deterrent effect in the Court’s view. In the Court’s view, on the application of the totality principle, the appropriate penalty for all of the contraventions found to have occurred by Golden Maple would be a total of $36,000. There will be an order accordingly.

CityTeam

1. CityTeam’s contravention of s.235(2) of the WR Act occurred in relation to two employees on two occasions over a period of slightly longer than three months in respect of a total amount of $394.40. Accepting that the appropriate penalty discount range is in the order of 60 to 90 percent, this contravention falls at the lesser end of that spectrum, and in the circumstances a penalty discount of 87.5 percent is considered appropriate by the Court. That would result in a penalty of $4,125 being payable by CityTeam, and there will be an order accordingly. The totality principle does not apply to a single contravention by a single respondent.[88]

   [88] Workplace Ombudsman v Securit-E Holdings Pty Ltd & Ors [2009] FMCA 700 at para.24 per Raphael FM.

Mr Chia

1. Mr Chia’s two contraventions of s.182(1) of the WR Act were in relation to Golden Maple’s failure to pay the basic periodic rate of pay on two occasions to two employees with a total amount of non-payment of $510. Having regard to Mr Chia’s role as the person responsible, both as a director and the person in charge of the day-to-day operations of Golden Maple, it appears to the Court to be appropriate to have a lesser penalty discount for Mr Chia than applied to Golden Maple, which was essentially acting at Mr Chia’s direction. Again, accepting the 60 to 90 percent penalty discount range as appropriate, and having regard to all of the relevant factors, a penalty discount of 75 percent ought to apply to Mr Chia. That results in a penalty of $1,650 payable by Mr Chia for each of the two contraventions, that is, a total of $3,300. There will therefore be an order that Mr Chia pay a penalty of $3,300 by reason of his involvement in the contraventions by Golden Maple under s.182(1) of the WR Act.

2. Having regard to the nature of the contraventions, the amount of the non-payments and the amount of the penalty, the Court, also having regard to the need for general deterrence, does not consider that there is any necessity for a reduction in the penalty applicable to Mr Chia’s conduct by reason of the application of the totality principle.

Conclusion and orders

1. For the reasons set out above, each of the respondents will have penalties imposed in the amounts set out above with respect to the various contraventions of the WR Act and the Golden Maple NAPSA. There will be orders accordingly.

2. The Court will hear the parties as to costs, if any.

I certify that the preceding one hundred (100) paragraphs are a true copy of the reasons for judgment of Lucev FM

Deputy Associate: Susan Dinon

Date:  31 July 2009