INDUSTRIAL LAW – general protections claims – adverse action – constructive dismissal – claims for wages and entitlements – claims for accrued employee entitlements paid on eve of trial – claims for compensation and penalties – applicant constructively dismissed from employment – contraventions of Fair Work Act 2009 (Cth) established – individual respondents held liable as accessories – applicable principles – compensation awarded for the period from dismissal until obtained new employment – penalties awarded for contraventions – where applicant party to scheme involving payment of one half of fortnightly net pay in order to provide evidence to meet criterion for graduate program and funding via Commonwealth government grant – penalties ordered to be paid to the Commonwealth.
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
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AGLC
Xie v Ecot Pty Ltd [2022] FedCFamC2G 104
Case
[2022] FedCFamC2G 104
Decision Date
CaseChat Overview and Summary
In the case of Xie v Ecot Pty Ltd, the applicant, Mr Xie, brought proceedings against Ecot Pty Ltd and related entities, asserting claims under the Fair Work Act 2009. The applicant, who was employed by Ecot, alleged various breaches of employment standards and unfair dismissal, among other claims. The court was required to determine whether the applicant's claims were substantiated and, if so, to provide appropriate remedies, including pecuniary penalties and compensation.
The court considered several legal issues, including whether Ecot had breached employment standards by making unreasonable requirements, constructively dismissing the applicant, underpaying wages, and failing to provide payslips. Additionally, the court examined whether the applicant was entitled to penalties under the Fair Work Act for the alleged breaches. The court's analysis involved a detailed review of the evidence presented by both parties, including documentary evidence and witness testimonies.
The court found that Ecot had indeed contravened several provisions of the Fair Work Act. Specifically, the court determined that Ecot had made unreasonable requirements for the repayment of salary and the execution of a Direct Debit Authority, constructively dismissed the applicant, underpaid the applicant's wages, failed to pay superannuation, did not provide payslips within the required timeframe, and provided misleading payslips. The court also concluded that the applicant was entitled to penalties for these contraventions. However, in determining the appropriate penalty, the court noted that the applicant had been actively involved in the arrangements that led to the contraventions, leading the court to decide that the penalties should be paid to the Commonwealth rather than the applicant.
The court ordered declaratory relief in relation to the established contraventions and awarded the applicant $20,000 in compensation, along with interest at a rate of 4.75% from August 2018 to March 2022, amounting to $3,500. Additionally, the court imposed penalties on Ecot for the contraventions, specifying that these penalties should be paid to the Commonwealth. The court's decision reflects a careful consideration of the evidence and the statutory provisions applicable to the case, ensuring that the remedies provided are both appropriate and just.
Orders
Orders of the court
Full text does not contain this section.
Background
Background to the litigation
Having regard to the whole of the evidence adduced at the hearing, it is also convenient to set out my findings upon the evidence as it relates to each of the topics addressed. My findings are drawn from the parties’ respective outlines of evidence together with their viva voce evidence as given in chief and in cross examination together with the documentary evidence upon which they relied and the inferences which I consider may properly be drawn upon the whole of the facts and circumstances of the case.Parties & background The applicant is fluent in English but his native language is Chinese Mandarin. The applicant obtained a Bachelor of Economics from the University of Macau in 2014, and a Master of Information Systems from the University of Melbourne in 2016. He first came to Australia in 2015 to commence his master’s degree. After completing this study, the applicant undertook a Professional Year Program with Navitas Professional, which he completed on 30 November 2017. As a part of that program, he completed an internship with Action OHS Consulting, working as a business analyst. Ecot, which develops and sells inventory management software, conducted its business activities from premises situated in Clayton South. It was common ground Mr Tian and Ms Trieu also conducted other business activities through a series of other companies including KCrown Pty Ltd and F&G Pty Ltd and that those companies also carried on their businesses from the same premises. There were perhaps 4-5 employees working in these businesses. It was common ground Mr Tian had been Ecot’s general manager at all material times (Ecot contended this title had not actually been employed for Mr Tian). By their opening statement, the respondents agreed Mr Tian had been Ecot’s sole director and secretary until 8 November 2017 and that thereafter, Ms Trieu had been the companies’ sole director and secretary from that date until 19 October 2018. Since that date, Mr Tian has resumed is holding the office of sole director and Company secretary. It was also agreed that Mr Tian and Ms Trieu were husband and wife and that Ms Trieu made all final decisions in relation to Ecot’s business. Each of Mr Tian and Ms Trieu (who also uses the name Kate Ttian), held email addresses styled [name]@KCrown.com.au and did not use an Ecot email address. While the applicant maintained he was not supplied a work email address until mid-January 2018, one of the WeChat communications from Mr Tian on 9 January 2018 confirms he had been supplied a work email address by 6:22 p.m. on that date (the day after he commenced work). There was some evidence that a shareholder dispute had arisen in either KCrown or F&G, as a result of which it was said that Mr Tian and Ms Trieu had experienced significant financial hardship, being left some $900,000 out-of-pocket as a result of the departure of another shareholder. Such was the scale of this dispute that when he commenced employment in January 2018, the applicant was instructed to call the police in the event of any intrusion at the premises by the now departed shareholder.
Evidence
Evidence Before The Court
On 23 March 2021, an order was made that the respondents file and serve a submission identifying all references on which they seek to rely in support of their allegations of criticism of the applicant’s work performance, any WeChat references which they contend to have been inaccurately translated and any email transmitting the Confidentiality Agreement which was to be signed by the applicant in relation to his employment. They did so. To the extent their submissions sought to identify particular translation errors, they were of little significance.Claims, defences & evidence Although the issues had narrowed somewhat by the time of the commencement of the trial and again by closing addresses, it is convenient to summarise the pleaded case and defence, doing so with recognition that the responses of the second and third respondents to the applicant’s amended claim (and as settled by their solicitors who had also filed the defence to the General Protections Claim before the Fair Work Commission) merely advanced a bare denial of the applicant’s claims, thereby putting him to proof on contested issues. Ecot’s defence to the claim as originally pleaded and as amended was settled by counsel. Collectively, those matters, including that they provide a reflex of the respondents’ instructions upon all relevant event, are of some significance in relation to the question of penalty. Beyond recognising that the applicant sued for compensation, pecuniary penalties, interest and declaratory relief, it is convenient to trace in further detail below the manner in which, and reasons why, the relief sought by the applicant had evolved up to the point of closing addresses. Having regard to the whole of the evidence adduced at the hearing, it is also convenient to set out my findings upon the evidence as it relates to each of the topics addressed. My findings are drawn from the parties’ respective outlines of evidence together with their viva voce evidence as given in chief and in cross examination together with the documentary evidence upon which they relied and the inferences which I consider may properly be drawn upon the whole of the facts and circumstances of the case.Parties & background The applicant is fluent in English but his native language is Chinese Mandarin. The applicant obtained a Bachelor of Economics from the University of Macau in 2014, and a Master of Information Systems from the University of Melbourne in 2016. He first came to Australia in 2015 to commence his master’s degree. After completing this study, the applicant undertook a Professional Year Program with Navitas Professional, which he completed on 30 November 2017. As a part of that program, he completed an internship with Action OHS Consulting, working as a business analyst. Ecot, which develops and sells inventory management software, conducted its business activities from premises situated in Clayton South. It was common ground Mr Tian and Ms Trieu also conducted other business activities through a series of other companies including KCrown Pty Ltd and F&G Pty Ltd and that those companies also carried on their businesses from the same premises. There were perhaps 4-5 employees working in these businesses.
Decision
Reasons for decision
Although I accept the authorities provide the usual order is for the penalty to be paid to a successful applicant, I do not accept that this is a usual type of case. In particular, I am in no doubt that upon the case advanced by the applicant he was actively involved in the arrangement of which he now complains. In those circumstances, I am not prepared to exercise the statutory discretion confirmed on the court to order that the penalty, or any part thereof, be awarded in his favour. To the extent relevant, no other party or organisation is suggested as being a fitting recipient. Each of the penalties will be ordered to be payable to the Commonwealth.Conclusion On 24 March 2021, the applicant’s counsel provided a draft of the orders sought. I have paid regard to those proposed orders in moulding the relief that I consider appropriate to the case. The court records its gratitude to counsel for the manner in which the hearing was conducted, particularly in the circumstance that the respondents were self-represented at trial.
Ratio Decidendi
Legal Principle Established
Applying the Interest on Judgments Practice Note (GPN-INT) and prevailing applicable interest rates in the period August 2018 – March 2022 (44 months), the applicant is to be allowed interest on such compensation at a rate of 4.75%. On a broad evaluation of the claim for compensation, the applicant will be awarded $3,500 by way of interest on $20,000.Relief – declarations & penalties I agree the applicant is entitled to declaratory relief in relation to the several contraventions which are established and involving contraventions of the following provisions: (1) the making of unreasonable requirements in relation to the repayment of one half of the applicant’s salary and the execution of the Direct Debit Authority in favour of TL Rentals: Act, s 325; (2) Ecot’s constructive dismissal of the applicant from his employment; further, its having injured the applicant in his employment and having altered his position to his prejudice: Act, s 340; (3) Ecot’s breach of cll 15 and 17 of the Award for underpayment of the applicant’s minimum wage entitlements; further, for failing to pay superannuation during his employment: Act, s 45; (4) Ecot’s breach of the National Employment Standards by failing to pay the applicant his annual leave within seven days of the conclusion of his employment: Act, s 44; (5) Ecot’s failure, on eight occasions, to give the applicant payslips within one day of payment: Act, s 536(1); Ecot’s having given the applicant to payslips which were false or misleading: Act, s 536(3). Although I have condensed the contraventions under six headings, I do not ignore that in several cases they involved separate contraventions. I have addressed accessorial liability. The applicant also applies for penalties rising from the proven contraventions of the Act. Chapter 4, Compliance and Enforcement, is arranged in two parts comprising ss 537 – 572 of the Act. Part 4-1, Civil Remedies, comprises ss 537 – 559. The Act entitles a person to apply for an order of a kind provided by Div 2 of Pt 4-1 of Ch 4. However, he or she may do so only if they are a person affected by a contravention of a civil remedy provision: Act, s 540(1). Within Pt 4-1, Div 2 concerns Orders and by Sub-div A provides for Applications for orders. Sub-div B concerns Orders and comprises ss 545-547. Section 546 provides for the making of Pecuniary penalty orders. The power conferred by s 546 is to make an order that a person pay a pecuniary penalty. The power so conferred is not engaged unless the court is satisfied a person has contravened a civil remedy provision. Upon being so satisfied, where application has been made, power is conferred on this court to order a person to pay a pecuniary penalty that the court considers ‘appropriate’: Act, s 546(1). The conferral of power to quantify the penalty is also framed in terms which require the court to be satisfied that it is ‘appropriate’ to do so. As employed in each of ss 545 and 546, the term ‘appropriate’ constrains the exercise of power in the determination whether to award compensation, impose a penalty and in quantifying those respective amounts: CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384, 408. Upon being satisfied it is appropriate a contravener pay a penalty, the scope of the liability for the debt created by the making of the order is to be such sum as the court considers ‘appropriate’ having regard to the particular type of civil remedy provision that was contravened and the unique facts and circumstances of the particular case.