Fair Work Ombudsman fines transport company, orders it to pay $220,000 back to staff
A Victorian transport company has been fined $11,880 and ordered to pay workers more than $220,000 in backpay, after the Fair Work Ombudsman pursued action against the company.
The operators of Bendigo-based company Symes Transport, Michael Symes and Janice Symes, were fined $5,940 each by the Federal Magistrate's Court, following prosecution by the Fair Work Ombudsman.
The case comes as last week the FWO announced a push for greater compliance with court penalties and back-payment orders.
Michael and Janice Symes admitted their business underpaid 44 employees a total of $251,942 between November 2005 and December 2009. The biggest underpayment of an individual employee was $29,914.
In her judgment of the case, Federal Magistrate Norah Hartnett said Michael and Janice Symes had not made enough effort in understanding current pay rate information, causing an "extremely large" amount of underpayments.
"The employees who have been underpaid have been deprived of the benefits of these amounts for a lengthy period of time," Hartnett said.
Slater and Gordon industrial and employment lawyer Yasser Bakri told SmartCompany such an amount could hugely impact upon an individual.
"An underpayment of such a large amount for an individual is the difference between being able to pay your mortgage or not and whether you're able to put food on the table each day," he says.
The workers were employed to either drive or load trucks and were underpaid their minimum hourly rates, overtime rates, shift and meal allowances and annual leave loading entitlements.
Industrial relations lawyer Peter Vitale told SmartCompany a small business underpaying staff by close to $230,000 was a significant breach.
"I guess the interesting thing is that for a small business to have underpaid their employees this amount of money in four years is a fairly substantial breach."
"We often see cases where you're dealing in cases of $20,000 or $50,000, but this is a substantial sum for a small business and probably reflects the observations that were made by the magistrate that they hadn't done enough," he says.
Bakri and Vitale also say the penalty rates issued by the court are at the upper-end of the spectrum.
"What's interesting about the levels of the fines in this case is that they are quite close to the maximums that can be ordered against individuals, reflecting the seriousness with which the court viewed the breaches," Vitale says.
"Fines can vary depending on a range of factors including cooperation with authorities, the seriousness of the breach and steps that have been taken to rectify the breach, previous incidences of similar conduct."
Bakri says the excuse used by some businesses that it's difficult to determine payment rates is a "cop out".
"There are many services provided to businesses of all sizes to determine how much to pay their employees. Unsure employers can find the answer through public information, ignorance is no excuse," he says.
In a statement, Fair Work Ombudsman Nicholas Wilson said underpaying staff was a serious matter and would not be tolerated.
"It is the obligation of employers to ensure they pay their employees their full entitlements," Wilson said.
SmartCompany contacted Symes transport but they were unable to comment prior to publication.