If a Fair Work Inspector reasonably believes that a business or person has failed to comply with provisions contained in the Fair Work Act 2009 (Cth) such as the National Employment Standards, then they can issue a compliance notice.
If issued with a compliance notice, employers must take action to remedy the contraventions outlined in the notice. Once complied with, employers must produce reasonable evidence of the compliance i.e. they must show that they have remedied the breach.
Failure to comply with a notice could mean that businesses have to front up the cost of a hefty civil penalty. A recent example of this is outlined below.
Summary of a Recent Court Case
In September 2022, the Federal Circuit and Family Court determined the matter of Fair Work Ombudsman v Adept Trolly Collection Services Pty Ltd.
In summary, Adept Trolly Collection Services (the employer), had contravened the relevant employment standards by failing to pay minimum wages, junior rates, part-time allowances, shift work penalty rates, Saturday penalty rates, Sunday penalty rates, public holiday rates, overtime and even superannuation.
A Fair Work Inspector issued a compliance notice under the Fair Work Act, ordering that the employer remedy the multiple underpayments suffered by five employees.
The employer was required to back-pay approximately $42,000 according to the compliance notice.
The employer ultimately failed to comply with the compliance notice. The employer did not have a reasonable excuse regarding why it had failed to comply with the compliance notice, and accordingly the Fair Work Ombudsman decided to litigate against the employer for the back-pay.
After the conclusion of the Court case, both the employer and its sole Director in his personal capacity were found liable for the breaches. The Director was found to have had knowledge of the breach and did not do anything to rectify the breaches from occurring.
The business was ordered to pay the full back-pay amount with interest and a penalty of $16,650, and the Director in his personal capacity was fined $3,300.
Key Takeaway for Employers
The Fair Work Ombudsman and Courts do not take breaches of compliance notices lightly. Compliance notices create serious obligations regardless of the size of your business.
If you are an employer who has a question regarding compliance notices, please contact Aaran Johnson or Simon Kumar to discuss how Marsdens can assist your business.
The contents of this publication are for reference purposes only. This publication does not constitute legal advice and should not be relied upon as legal advice. Specific legal advice should always be sought separately before taking any action based on this publication.