A Brisbane-based technology company has been slapped with a record fine by the Fair Work Ombudsman (FWO) for failing to repay a former employee that was found to be unfairly dismissed.
Macquarie Technology Group International Pty Ltd and its owner were both found to have contravened the Fair Work Act in Australia’s Federal Circuit Court, with the company facing a $105,000 fine, and the business owner facing an additional $20,600 fine.
The penalties come after the business was ordered to compensate a former employee in 2014 who the Fair Work Commission found was unfairly dismissed, with the Commission ordering $20,769 in compensation to the worker and a further payment of $8,470.
However, despite multiple requests by the FWC for the company and its director to compensate the affected worker, no compensation was made. This led to legal action being instigated by the Fair Work Ombudsman due to the company failing to comply with the Commission’s orders.
The total penalties of $125,600 are the highest ever secured by the Fair Work Ombudsman against an employer who failed to repay an unfairly dismissed worker.
“The penalties obtained by the Fair Work Ombudsman send a strong message to businesses that there are serious consequences for failing to comply with Fair Work Commission Orders,” Fair Work Ombudsman Sandra Parker said in a statement.
“It is fundamental for the integrity of the workplace relations system that orders are complied with and we will take legal action to ensure employees receive compensation,” Ms Parker said.
On top of the significant penalties, the company has again been ordered to repay the nearly $30,000 in compensation owed to the employee, along with further interest of $5,646.
This is also the second time the FWO has taken action against Macquarie Technology Group International, with $6,380 in penalties secured against the company and its director in 2011 after it was found to have underpaid a worker $6,000.
“Court orders are court orders”
Further to the standard penalties, the Federal Circuit Court has also ordered that if the company fails to appropriately compensate the employee, the penalties directed at the business’ owner will be siphoned to the employee as way of partial compensation.
Speaking to SmartCompany, director at Workplace Law Shane Koelmeyer says the FWO choosing to step in on behalf of the employee is an unusual step and one he’s not seen happen before.
“Instead of the employee incurring more costs to try and get their compensation, the FWO has intervened and said if the owner pays their penalties before the compensation, then the money from that penalty will go to the employee,” he says.
Koelmeyer notes the size of the penalties imposed against the business and its director are significant, putting the size down to the fact the business is a repeat offender and that it had refused to comply with court orders, believing the FWO wanted to make an example.
“It’s unusual for the parties who faced court to ignore the orders to that extent. Everyone has the right to an appeal, but at the end of the day if you lose those appeals court orders are court orders,” he says.
“You have to abide by the umpire’s decision.”
Koelmeyer also believes this case shows the Fair Work Ombudsman is willing to demonstrate to businesses the extent of its reach, and its willingness to intervene where businesses are being non-compliant. He says the workplace watchdog and the Federal Circuit Court are “setting the watermark” to show businesses they are serious.
“If you look at this case, the business was better off paying the $20,000 in compensation first off, because now they have to face up to a $125,000 penalty. So it shows for businesses, you’re always better off paying the money you initially owe,” he says.
“And if you’re a party who turns up to court and you haven’t complied with former court orders, they’re always going to take a dim view on that.”
SmartCompany was unable to get in contact with Macquarie Technology Group International.
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