Applicant Seeks Imposition of Pecuniary Penalties Against Respondent

Fair Work Ombudsman v Housego [2022] FedCFamC2G 116 (23 February 2022)

The applicant filed an application for imposition of pecuniary penalties by reason of flagrant non-compliance by respondent with compliance notices.  The respondent has not made any appearances to the court despite notice.  The Court, in resolving this dispute relied upon relevant principles for imposition of penalty and the need for deterrence.

Facts:

On 30 July 2021, the applicant commenced proceedings against the respondent in respect of alleged contraventions of provisions of the Fair Work Act 2009 (‘the Act’).  On that day, the applicant filed an Application and a Statement of Claim.  In an affidavit filed on 8 February 2022, one Natasha Rice deposed that she had personally served the respondent with a copy of the Application and the Statement of Claim on 28 August 2021 at Kelso, in the State of Queensland.  Despite being ordered on 17 September 2021 to respectively file a Response and Defence to the Application and the Statement of Claim by 27 September 2021, the respondent has filed no such document.

The respondent has at no time entered any appearance, or appeared either by herself or by an agent, at any court hearing to the date of this judgement, notwithstanding that the respondent had been given notice of, and properly served documents in respect of, all such court hearings.  Under the Statement of Claim, it was provided that from in or around May 2020 to in or around October 2020, FWI Barney conducted an investigation into the Employer (Investigation).  FWI Barney formed a belief that the Employer employed Jasmin Baldwin (Baldwin), Crystal Beckett (Beckett), Matthew Garwell (Garwell), Dean Robinson (Robinson), Kayeley Souey (Souey) and Garret Magian (Magian) as employees (together, the Employees).  FWI Barney alleged that the Employer contravened the following terms of the Food Award and FW Act in respect of the Employees’ employment during the Employment Periods.  FWI Barney gave a compliance notice to the Employer in respect of the Contraventions.

The Applicant seeks a declaration that the Employer contravened section 716(5) of the FW Act by failing to comply with each of the Compliance Notices.  It is further sought that orders be made for the Employer take the steps that were required by each of the Compliance Notices by calculating and paying to Ms Baldwin, Mr Garwell, Ms Souey, Mr Robinson and Mr Magian the outstanding entitlements the Employer was required to pay to those Employees as specified in the Compliance Notices; calculating and paying superannuation contributions into the nominated superannuation funds of Ms Baldwin, Mr Garwell, Ms Souey and Mr Magian for additional superannuation contributions required to be paid on their outstanding entitlements; preparing and producing to the Applicant a schedule outlining the Employer’s calculation of the outstanding entitlements the Employer is required to pay each of Ms Baldwin, Mr Garwell, Ms Souey, Mr Robinson and Mr Magian and the superannuation contributions required; providing proof to the Applicant that the outstanding entitlements and additional superannuation contributions; and such further orders as the Court considers appropriate.

In an affidavit filed on 7 February 2022, it was deposed by one Natalie Barney that February 2022, the respondent had failed (save in one respect) to comply with the requirements in either the compliance notices which had been issued against the respondent, or orders made by this Court requiring compliance with such orders.   On 8 February 2022, submissions were made on behalf of the applicant seeking the imposition of pecuniary penalties against the respondent pursuant to the provisions of s. 546(1) of the Fair Work Act 2009 (Cth) (the Act). 

Issue:

Whether or not the sought penalty should be imposed. 

Applicable law:

Fair Work Act 2009 (Cth) s 716(5) - provided that failure to comply with a compliance notice was a civil remedy provision. 

Fair Work Act 2009 (Cth) s 546 - provides that the Federal Court, the Federal Circuit and Family Court of Australia (Division 2) or an eligible State or Territory court may, on application order a person to pay a pecuniary penalty that the court considers is appropriate if the court is satisfied that the person has contravened a civil remedy provision.

Fair Work Ombudsmen v VS Investment Group Pty Ltd (2013) FCCA 208 - provides that the failure to comply with compliance notices is in itself a serious contravention.

Fair Work Ombudsmen v NSH North Pty Ltd trading as New Shanghai Charlestown [2017] FCA 1301 - considered whether there should be further adjustment to ensure that, to the extent of any overlap between groups of separate aggregated contraventions, there is no double penalty imposed, and that the penalty is an appropriate response to what each respondent did.

Analysis:

For the purposes of deterrence, any penalty must have the necessary “sting or burden” to signify that the penalty as imposed will be seen to justify its imposition.  The maximum penalty able to be imposed by the Court upon the respondent in her capacity as an individual under ss. 539(2) and 546(2)(a) of the Act was in the amount of $6,660.00.  The respondent well knew of the contents of the compliance notices but failed to comply with them, or otherwise act so as to avoid litigation.  As earlier indicated, the only part-compliance by the respondent with any of the notices was in respect of the payment to the employee Beckett in respect of CN-1.

The evidence before the Court is that the applicant maintains a current Australian Business Number (ABN).  Hence, there is a need to specifically deter the respondent from engaging in the same or similar contravening conduct in the future.  There has been no demonstrated contrition on the part of the respondent, nor has the respondent meaningfully engaged in any respect with the applicant during the course of the litigation process.

Conclusion:

The Court accepts that the higher penalty ranges submitted on behalf of the applicant as being appropriate in respect of the contraventions of CN-1 and CN-4 are justifiable.  The Court imposes the following penalties against the respondent:

(a) In respect of CN-1, a penalty in the amount of $4,662.00.

(b) In respect of CN-2, a penalty in the amount of $3,330.00.

(c) In respect of CN-3, a penalty in the amount of $3,330.00.

(d) In respect of CN-4, a penalty in the amount of $4,662.00.