A Melbourne business is facing legal action in the Federal Circuit Court after ignoring a Fair Work Commission order to pay compensation to an employee it was found to have unfairly dismissed.
The case comes after the Fair Work Ombudsman announced a push to ensure court penalties and back-payment orders are upheld in February last year.
On January 17, the Fair Work Commission ruled World Gym Sunshine had 14 days to pay $2200 compensation to a 24-year-old receptionist, Samaka Sophia Ndege.
Get daily business news.
The latest stories, funding information, and expert advice. Free to sign up.
Despite the order, the former employee contacted Fair Work claiming she had not been paid her compensation by the gym, which is located in the suburb of Sunshine in Melbourne’s west.
Following the complaint, the Fair Work Ombudsman issued several notices to the business requesting for it to comply with the order, which were also allegedly ignored.
As a result, World Gym Sunshine as well as its former sole director and part-owner, Wayne George Mailing, are set to face legal action, with a directions hearing listed for September 19.
The gym faces a maximum penalty of $51,000, while Mailing could potentially receive a penalty as high as $10,200.
World Gym Sunshine told SmartCompany Mailing sold the business in August of last year, and that it would not be commenting on the case further.
SmartCompany attempted to contact Mailing, but no comment was available prior to publication.
In its official statement, Fair Work Ombudsman Natalie James said she was prepared to take action where appropriate.
“Our inspectors made extensive efforts to engage with this business to try to resolve the matter, but were not able to secure any co-operation,” said James.
“Compliance is fundamental for the integrity of the workplace relations system and employers.”
Employment lawyer Peter Vitale told SmartCompany it is unusual for an industrial relations case to reach the Federal Circuit Court, and it might be the first time it’s happened since the current Fair Work Commission was introduced.
“The case is unusual in that when the Fair Work Commission makes an order, the vast majority of employers apply them,” Vitale says.
“Since 1956, the mechanism has always been that if an employer or employee ignored a ruling of the industrial relations tribunal, then it could only be enforced through a federal court,” he says.
“So this is an unusual example of the need to take action in the federal court to enforce a decision. Most people, whether they’re employers, employees or unions, will comply.”