The Fair Work Ombudsman has secured the maximum available penalty in court - $41,250 - against Perth company My IT Partner Pty Ltd, for failing to comply with a compliance notice requiring it calculate and back-pay a full-time helpdesk worker’s entitlements the Ombudsman alleged were owed.
The Federal Circuit and Family Court imposed the penalty against My IT Partner Pty Ltd, which operates a business trading as My Info Tech Partner, which lists services including cyber security, managed IT, data backup and recovery and cloud on its website.
The Ombudsman investigated after receiving a request for assistance from the affected worker.
A Fair Work Inspector issued a compliance notice to My IT Partner Pty Ltd in May 2023 after “forming a belief” the company had underpaid the worker’s minimum wages and failed to pay him any wages for the final three weeks of work he performed. The worker was employed on a full-time basis in an IT helpdesk support role between August 2019 and August 2022.
The wages were allegedly owed under the Miscellaneous Award 2010 and 2020.
The inspector also formed a belief the worker was not paid accrued but untaken annual leave entitlements at the end of his employment, owed under the Fair Work Act’s National Employment Standards.
In his judgment, Judge Sandy Street found that My IT Partner Pty Ltd displayed a “deliberate and intentional defiance of the notice” referring to correspondence from sole director and shareholder, Aaron Fisher, as part of the company’s response. According to the Ombudsman’s media statement, the correspondence threatened to commence a lawsuit against the Fair Work Ombudsman if it continued to seek to enforce compliance with the compliance notice.
Judge Street found that the company’s “deliberate and defiant refusal” to comply reflected “conduct of a kind that shows there is a very real need for subjective deterrence”.
“The evidence as to continued existence of [My IT Partner Pty Ltd] and [its] engaging employees and the absence of any culture conducive to compliance and the role of senior management in the deliberate and intentional contravention in the present case warrants the Court imposing the maximum penalty on [the company],” Judge Street said.
The Court has ordered My IT Partner Pty Ltd to calculate and back-pay the entitlements still owed to the worker under the compliance notice, plus interest and superannuation.
Small business perspective
In a statement to techpartner.news, Fisher – who was not personally penalised in the case – argued: “When a director pays themselves between a half to two thirds less than their employee, struggling to survive themselves, just to keep someone employed and not make that employee a burden on the taxpayer... and Fair Work is able to take them to court over that, then the Australian industrial relation system is too one sided.”
"No company or business can afford to pay employees more than the company or business is making in income. They certainly can’t do that after losing their biggest client, who was contributing 90% of the employees salary.
"If the company does pay employees more than it earns in income, then the company is forced to close down and everyone loses their job."
Fisher said that he believed it was time every small business owner and company director in Australia rallied in Canberra to lobby for a return of balance to Australia’s workplace relations system.
"What happened to us in this instance could happen to every business and company in Australia," he said.
"Ultimately, it would negatively affect the business owner, and they may make a decision to close down their business.
"If Labor, Fair Work and ultimately the union movement continue to push this line, they will find they will cause mass unemployment, due to the number of people employed by small businesses across Australia. Then everyone will lose, and the taxpayer gets lumped with the bill.”
"We will continue to take legal action to protect employees"
Fair Work Ombudsman Anna Booth said business operators that fail to act on compliance notices need to be aware they can face penalties in court on top of having to back-pay workers.
“When Compliance Notices are not followed, we will continue to take legal action to protect employees,” she said.
“The case highlights that employers who fail to act on these notices – including those who deliberately seek to defy them – risk substantial penalties in addition to being ordered to back-pay workers."
Last week, the Fair Work Ombudsman commenced legal action against David Mark Blumentals, who it described as the former owner-operator of IT services company D365.Group Pty Ltd, alleging he was involved in underpaying workers almost $150,000.
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