Employer disillusioned with FWO investigation slapped with thousands in fines

A Perth real estate agency that was deeply critical of the investigative process adopted by the Fair Work Ombudsman (FWO) in response to a former employee’s claim for unpaid notice of termination has been slapped with nearly $20,000 in fines by the Federal Court, despite the employer belatedly correcting the underpayment from 2019, which amounted to just $2,700 (plus superannuation).

The Agency’s initial dealings with the FWO in February 2021 were less than conciliatory, with the employer’s Director responding to the FWO’s compliance notice decrying the investigation as “bulls**t”, asserting the FWO inspectors were “all fools” and labelling the FWO’s paperwork and correspondence, “very amateurish and full of threats”. “That being said, we are not able to comply with any requests from the Fair Works (sic) Ombudsman,” the Director added.

The process had started out on shaky ground when, during a phone discussion with one of the FWO inspectors in January 2021, after the employer was advised the next step would likely be a compliance action, he was quoted as telling the inspector “he [did] not give a f*** and [the FWO] could take him to the highest court in the land if [the FWO] wished”.

The employer refused to comply with the compliance notice, largely due to his “annoyance” with the FWO’s method of investigating the ex-employee’s claim, which he perceived as “amateurish and inappropriate” because it involved “nothing but telephone calls to me by the FWO asserting the employee’s position without according (sic) me an opportunity to present ‘my side of the story'”. It was only after taking legal advice, when the FWO commenced proceedings in the Federal Circuit and Family Court, that the employer conceded to pay the former employee his two weeks’ notice, plus superannuation, meaning it was no longer necessary for the Court to hold a liability hearing.

Despite the employer arguing for no penalty, or a nominal amount of only $1, Judge Lucev determined a penalty was necessary to deter the employer from future non-compliance with workplace laws, observing the employer’s submission to be “one of the most extraordinary submissions, if not the most extraordinary submission, that the court as presently constituted has heard as to quantum of penalty in more than 15 years of determining penalty cases under the Fair Work Act and the former Workplace Relations Act”. In addition, Judge Lucev noted he could level “no criticism” against the FWO or its officers “in respect of their conduct in this matter”, while the circumstances of the investigation would not justify a penalty reduction.

His Honour concluded the employer failed to convey appropriate contrition or understand the “gravity” of its conduct and imposed fines totalling $15,000 for the business and $3,000 for the Director.

Fair Work Ombudsman v Darrell Crouch & Associates Pty Ltd [2023] FedCFamC2G 80 (10 February 2023)