The Industrial Magistrate, in a supplementary Reasons for Decision, has ordered that a maintenance company pay a pecuniary penalty of $59,850 to an ex-employee for contravening civil remedy provisions of the Fair Work Act 2009 (Cth) (FWA) concerning a range of leave and record-keeping provisions.

In the first reasons, Industrial Magistrate Flynn upheld a claim for payments made under the FWA for accrued annual leave, public holidays, overtime and leave loading. A summary of those reasons can be read here.

The supplementary reasons are in relation to an application by the ex-employee for a pecuniary penalty pursuant to the FWA.

The ex-employee submitted that the appropriate total of penalties to be imposed should be $105,000. He claimed that the company engaged him as a sham contractor, applied illegitimate pressure to sign a waiver document and that its conduct could be described as a gross failure to comply with the FWA. The ex-employee also called for a substantial personal deterrent penalty as the company expressed no contrition and submitted that, as an unskilled older worker, is unlikely to work again.

The company submitted that the appropriate penalty should be $23,121. It submitted that it made an honest mistake in characterising the claimant’s arrangement and legal relationship, findings of ‘illegitimate pressure’ and ‘economic duress’ was isolated and occurred once and that it had taken adequate corrective action. The company rejected the ex-employee’s claims that it deliberately set out to evade the law or misrepresent the arrangement to the ex-employee.

Industrial Magistrate Scaddan found that her reading of the first reasons did not reveal that Flynn IM found, or inferred, that the company misrepresented the arrangement between the parties, engaged in deceitful conduct, or gave rise to the consideration of a sham arrangement. Her Honour also determined that the company did not attempt to ‘hide’ any contraventions and had taken further steps to ensure future compliance with the FWA. However, her Honour considered the fact that the ex-employee is an unskilled worker and suffered a loss (being the actual entitlements) that was reasonably significant.

Scaddan IM found that the appropriate penalty to be paid to the ex-employee was $59,850.

An order has been made accordingly.

The decision can be read here.