The Fair Work Ombudsman reveals why it “names and shames” small businesses

feature-name-and-shame-200Hairdresser Craig Lane was shocked to hear the Fair Work Ombudsman was prosecuting him for underpayment of wages but his surprise turned to anger when he was “named and shamed” in a press release that hit the media before the case against Lane even went to court.

The Melbourne hairdresser says the Ombudsman “publicly destroyed my business” after the press release was picked up by four local newspapers and radio stations 3AW, Fox FM and Triple M.

The hairdresser who the FWO says underpaid an apprentice

The press release issued by the FWO earlier this year announced the prosecution of Lane and fellow salon owner Anne-Marie Drummond for underpaying a young apprentice at the Hennesy Lane Hair Design salon $3,627.

In the release, the Ombudsman claimed the apprentice hairdresser was not paid for a series of training sessions she was required to attend. However, the salon repaid the money claimed once the investigation by the Ombudsman commenced.

The press release noted a date for a court hearing in October and stated that Drummond and Lane faced maximum penalties of up to $6,600 per breach and the salon faced maximum penalties of up to $33,000 per breach.

“I was always under the impression that you can’t name someone until you have actually won the case,” says Lane.

“In the local paper that I was named in, on the same page someone robbed a house, someone was a paedophile and they didn’t name the person.”

Lane says the FWO is attacking an industry it has “no idea” about.

“The FWO should work for the employer and employee; they’re not a watchdog, they are a killer. They go out and destroy businesses bit by bit.”

Despite the damage to the reputation of Lane and Hennesy Lane Hair Design, the case didn’t make it as far as the court room.

“One, it’s not even going to  court; we had a mediation meant to go for two days and it went for two hours as their figures were totally wrong,” says Lane.

“And two, they actually owe me money, I don’t owe them money.”

Lane says he incurred substantial legal fees fighting the FWO’s prosecution.

“We have spent $40,000 in legal fees for a case that has no merit. I’m a big salon and I’ve been around a long time, but for a little salon it would destroy them,” says Lane.

“I reckon [the Ombudsman] spent $100,000 of taxpayers’ dollars on me, I had about 40 meetings with them.”

For Lane, however, the concern isn’t so much the money as his reputation.

He believes the FWO targeted him to try to make an example of a prominent business in the sector.

“I’ve won hairdresser of the year four times, salon of the year six times, and they’ve basically gone after a big person in the industry, someone who does do training,” he says.

“Fair Work are trying to destroy people who are trying to do the right thing.”

“It’s crazy what they are doing. They will destroy an industry that works on very, very small margins.”

The panel beater who the FWO claims sacked an employee with cancer

It’s not unusual for the FWO to publicise a prosecution before it takes it to court.

More recently the FWO issued a press release claiming Pasquale Minniti, who part-owns and runs panel beating business Hi-Lite Automotive, dismissed a full-time spray painter – after the employee was diagnosed with cancer – in an effort to prevent him from taking paid personal leave.

Minniti hit back at the claims by the Ombudsman and told SmartCompany he planned to defend the allegations but is limited in what he can say as the court proceedings are on foot.

“I would never sack a guy with cancer,” he says.

“At the end of the day, I am not worried about it as I have not done anything wrong.

“There is a lot more behind this than the FWO is saying.”

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