The Fair Work Commission has imposed $164,635 in penalties against the former operators of a bar and restaurant in Bondi for “extensive and deliberate” contraventions of the Fair Work Act. The fine comprised of a $137,196 penalty against the operating company, and a $27,439.20 penalty against the company’s former director.
The penalties were imposed as a result of a failure to comply with Compliance Notices from 2021, which required back-payments to be paid to eight workers.
The Fair Work Ombudsman became aware of the further breach after receiving a request for assistance from a worker.
A compliance notice is issued when an employer does not cooperate with a Fair Work Inspector to fix a breach. The compliance notice is issued instead of starting legal proceedings. A compliance notice will include information about:
- how the employer has breached a workplace law
- what the employer needs to do to fix the issue (eg. pay an amount to 1 or more employees and/or give evidence to show the issue has been fixed)
- the time the employer has to fix the issue (eg. that payment is made within 14 days)
- how the employer can apply to have the notice reviewed by a court
- what happens if an employer doesn’t comply with the notice.
If a compliance notice is complied with, the Fair Work Ombudsman cannot start legal proceedings.
In 2021 the Court imposed back-payments to one of the workers at Upper East Side Bondi, totalling $3,496. While the company had back paid the other seven workers, albeit seven months after it was required to do so, the eighth employee did not receive their payment.
The company also provided the Fair Work Inspectors with false information and documents on 12 separate occasions. The documents provided to the Inspectors showed that workers had been back paid, when in fact they had not. The Court found that this contravention was “extensive, and by their nature deliberate”.
There was a need to impose greater penalties on the company in order to deter other employers from failing to comply with Compliance Notices and for providing misinformation to inspectors in order to avoid paying the amounts owed under the Notices.
The Court made an additional order that the company provide evidence of the payments made to the ATO, of the PAYG amounts withheld from the payments made to employees.
These penalties show the seriousness with which employers must treat compliance notices. This was the second time that the company failed to comply with the notices, and the penalties increased substantially. It is also clear that the Court will hold individuals accountable for their failure to act on the Notices by imposing fines on Directors, particularly when the director is aware of the nature and significance of the notices.
The Fair Work Ombudsman provides free courses, including in relation to compliance notices, to ensure that employers are informed of what action they need to take and how they deal with compliance notices. They can be accessed though the Online Learning Centre – Online learning centre – Fair Work Ombudsman
Lessons for Employers:
- It is important for employers to educate themselves on their requirements and obligations should they receive a notice from an Inspector;
- Employers should conduct audits to ensure that they are not in breach of the relevant awards;
- Employers must promptly comply with any notices made by the Fair Work Ombudsman or risk having penalties significant increased;
- Directors need to be aware of their obligations in relation to compliance notices or risk having personal penalties imposed on them;
If you would like to discuss these or other workplace issues please contact Andrew Bland or call 02 9412 3077.