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Category: Workplace Investigations

  • Largest ever Court Imposed Fine for Breaching 457 Visa Sponsorship Obligations

    Five weeks after ordering Darwin-based Choong Enterprises to pay the largest-ever court-imposed fine for breaching 457 visa sponsorship obligations, the Federal Court has directed the Company to backpay 7 of the Filipino workers involved, totalling more than $100,000.

    Justice Mansfield found in April 2015 that Choong Enterprises Pty Ltd (which operates a number of fast food restaurants and cafés) had underpaid the workers who were 457 visa holders, only $12 an hour between 2009 and 2012.

    The Company failed to pay entitlements such as loadings, sick leave and superannuation contributions and failed to comply with record-keeping obligations, produced false pay records and had recovered the costs of migration agent fees from 4 of the visa holders.

    Justice Mansfield in April ordered the Company to pay $175,400 in pecuniary penalties and ordered its sole director and shareholder, Ronald Choong, to pay $800, finding he had aided and abetted the Company’s actions.

    However, his Honour refused to impose a penalty on the director’s wife (who was not a company officer), finding that while she was aware “more broadly” of the Company’s failure to comply with its sponsorship obligations, she “was not doing so in a considered and consistent way“.

    The government subsequently sought $125,956 in total reimbursements for 7 of the affected employees (all from the Phillippines) under the Migration Regulations 1994.

    The judge rejected the Company’s application for periodic payments, noting that while Choong Enterprises’ trading assets had been reduced to operating a fish and chip shop in Nightcliff, it had sold most of its business to D & C Gourmet Pty Ltd, whose director shared an address with Ronald Choong.  He noted the “stark” difference in restitution payable under the Migration Act to the exploited employees, depending on whether it was calculated using the base rate prescribed for the purposes of section 140(1) of that Act, or the relevant award.

    His Honour said, “Without going into the detail of each of the 7 sponsored employees involved, as the PAYG tax adjustment in each case is different, the total claimed by way of reimbursement of regulation 2.79 fixes the entitlement, the total reimbursement sought by the Minister is $125,956 compared to $52,480 if the Award is the appropriate starting point.”

    After Justice Mansfield made the initial ruling in April, Assistant Minister for Immigration and Border Protection, Senator Michaelia Cash, in a statement said it was the department’s first Federal Court civil penalty application and the largest civil penalty any court had imposed for a breach of sponsor obligations.

    Senator Cash said, “The stiff penalty this company has received should send a warning to other sponsors: if you fail to meet your requirements, my Department may impose administrative sanctions, issue an infringement notice, execute an enforceable undertaking, or apply to the federal court for a civil penalty order” .

    [Minister for Immigration and Border Protection v Choong Enterprises Pty Ltd (No 2) [2015] FCA 553 (4June 2015)]

    Taskforce Cadena

    Senator Cash in a statement issued Friday 5 June 2015, welcomed the Federal Court result and said to expect further investigations with the commencement of Taskforce Cadena from 1 July.

    Senator Cash said, “The Coalition Government understands that at times businesses need to access foreign labour for positions that cannot be filled locally, however we are committed to ensuring integrity is maintained across our migration programmes through rigorous enforcement of the rule of law“.

    The task force (headed by the Department of Immigration and Border Protection and the Fair Work Ombudsman) will work with the Australian Federal Police, Australian Securities and Investment Commission, the Australian Tax Office, and various state and territory agencies to investigate instances of worker exploitation and visa fraud.

    Senator Cash said, “The Department of Immigration and Border Protection and the Fair Work Ombudsman are active in ongoing compliance campaigns to ensure that temporary visa holders are being paid in accordance with Australian pay and conditions. This taskforce will greatly complement those existing efforts.”

  • Fair Work Commission – “bullying” was reasonable management action and rejected a long-serving employee’s bullying claim.

    The Fair Work Commission said, “bullying” was reasonable management action, and has rejected a long-serving employee’s bullying claim.  The Commission accepted that the employer, Salvation Army Employment Plus, took reasonable management action when it performance-managed its employee after she resisted changes to workplace practices.

    Commissioner Lee in a ruling issued 4 June 2015 said the issues raised by the Salvation Army Employment Plus job placement consultant in her bullying claim “are reasonable management action undertaken in a reasonable manner”.  The Commissioner said the consultant particularly objected to a change that involved her seeking to place in jobs clients from the full “rainbow” of applicants, rather than just the “generally job ready” clients she had dealt with in her 9 years with the organisation.

    The placement consultant told the Commission at the hearing in April that the change meant she was now required to deal with stream-4 clients who “may be somebody who is recently out of prison and they have drug issues, mental health issues, schizophrenia, they are considered not job-ready”.  The consultant refused to deal with the stream-4 clients claiming it was unsafe, but Commissioner Lee, after considering evidence including a recent Worksafe inspection, said he was satisfied there was no such risk.  Commissioner Lee said the change in client mix, alongside the employer’s new approach to performance management, “is a major driver” of the consultant making the bullying claim.

    The consultant claimed she was being unreasonably performance managed and micro-managed.

    The Commissioner said the consultant was “deeply distressed that her refusal to service ‘stream 4’ clients was the basis for the finding [in a performance assessment] that she was not meeting the values of the organisation”.  The employer gave her a score of 57 out of 100 in her most recent assessment, against an average across all employees of 62, marking her down for failing to service the stream 4 clients.

    Commissioner Lee said that it was “not unreasonable” for her refusal to “become a matter of note in her performance appraisal“, given that it was part of her position description.  The Commissioner said Employment Plus had in the past failed to assess individual performance but while its introduction had been “a significant change” for the consultant, “the manner in which it has been introduced or administered does not appear to be unreasonable.”

    Organisation shifting from “moribund” to “performance focussed“

    Commissioner Lee said the organisation had shifted from “a long period of moribund management to an environment where the organisation is performance focussed… However, while this represents a significant change in her working environment, the fact that it occurred and the method of its implementation did not amount to bullying”.

    Commissioner Lee said the change within Employment Plus was a response to the Salvation Army seeking to implement a “high performance culture” to turn around losses that meant the job agency was being subsidised.

    Commissioner Lee said “She was forced to adjust to a more active management after a lengthy period of the organisation managing her and her colleagues very poorly… However, while this was a change that had a personal impact on the [consultant], particularly with the high turnover, there is no evidence that the approach taken amounted to bullying behaviour directed at the [consultant], particularly given the evidence of the timely replacement of vacancies in the organisation.”

    [A. B. [2015] FWC 3353 (4 June 2015)]

  • Employer Liable Vicariously for Sexual Harassment of Employee

    The Queensland Civil and Administrative Tribunal has found a Gold Coast resort vicariously liable for the sexual harassment of a female employee, further, that its mishandling of her complaint contributed to a psychiatric injury. [McCauley –v- Club Resort Holdings Pty Ltd (no 2) [2013] QCAR 243 (13 May 2013).

    Image
    The Tribunal Member, Jeremy Gordon, found Club Resort Holdings Pty Ltd vicariously liable for a male Chef’s sexual harassment of the female Food and Beverage Attendant, who ran the buffet in the Kalinda Restaurant in the RACV Royal Pines Resort.

    Member Gordon was particularly critical of the HR manager who mismanaged the Attendant’s allegations by failing to obtain a full account of events from her, and instead focusing on obtaining a statutory declaration from the Chef, making it almost impossible to test his version of events.

    The Attendant alleged that during the Australian Ladies Masters Golf tournament over 3 days in early March 2010, the Chef sexually harassed her and discriminated against her based on her sex and age, by:

    • commenting that she smelt like “Old Spice” – a scent he associated with his grandfather and asking whether anyone else could smell it;
    • sniffing the air when in her vicinity, invading her personal space; and
    • referring to her as a cougar and making growling noises, including growling in her ear and around her neck.

    The Attendant attempted to ignore the Chef, but she was unable to stop his actions.  The Attendant claimed she told him, “this kind of behaviour is unnatural Steve, I’m old enough to be your mother, this is disgusting“.

    He replied: “you have nothing to be worried about, I’m a happily married man“.

    After 3 days the Attendant told the Chef that he was an “arsehole” and that he should back off and “f@#k off“.  The Chef apologised, but did not stop his comments.

    The resort’s investigation into the incidents concluded that the Attendant’s allegations were unfounded.

    The Attendant went on leave for 3 months and made 2 WorkCover claims for permanent impairment caused by the sexual harassment and the Resort’s inadequate investigation.

    The Attendant further alleged that the Resort victimised her in response to her complaint by:

    • failing to carry out an adequate investigation, and failing to find that her complaint was proven;
    • requiring her in June 2010 to conduct contract negotiations with the Resort’s HR Manager, despite her known lack of trust in the Manager;
    • disciplining her for talking to colleagues about the progress of her sexual harassment claim and for failing to perform her duties; and
    • subjecting her to unwarranted disciplinary action for failing to give 2 hours’ notice that she was taking sick leave as a result of experiencing a panic attack.

    Member Gordon found that the Chef had subjected the Attendant to unsolicited acts of physical intimacy and engaged in unwelcome conduct of a sexual nature, saying that a reasonable person would have anticipated the possibility that the Attendant would be offended or humiliated by the conduct.

    He also found the Chef made the cougar and “Old Spice” references in response to the Attendant’s age (49 years of age).

    Member Gordon said it was “very surprising” that the Resort failed to corroborate the Attendant’s allegations, especially given WorkCover’s later conclusion “without a doubt that the events alleged by [the attendant] did take place“, injuring her as a direct result.

    He described as “extraordinary” the fact that the HR Manager failed to obtain a full version of the events from the Attendant’s point of view before asking the Chef to make a statutory declaration.   He said, “This error was compounded by the fact that [the Chef] was not interviewed again. This meant that his statutory declaration made on the day of that meeting stood as his statement in the investigation. The first time [the Attendant’s] allegations in full were put to [the Chef] was at the hearing before me“.

    The Resort’s Employee Relations and Remuneration Manager concluded that while the Chef had made the Old Spice and cougars comments, he said “a reasonable person in similar circumstances would view the comments as light hearted and not derogatory“.
    But Member Gordon found this conclusion was inadequate because the Resort failed to:

    • give the Manager a copy of an interview between the HR Manager and the Chef in March 2010, when he admitted telling the Attendant “you are a bit of a cougar“;
    • ensure the Attendant was interviewed by the investigator (she didn’t know one had been appointed); and
    • provide the Attendant an opportunity to comment on the Resort’s findings before she was told the result.

    Further, 3 witnesses (including the HR Manager) who the Attendant alleged were present in the kitchen, including when she told the Chef to “f@#k off“, were not called to give evidence during the investigation.

    Member Gordon found that the sexual harassment, discrimination and the mismanagement of the Attendant’s complaint contributed to and caused her to suffer from an adjustment disorder and depression, leaving her unable to work at the resort.

    Member Gordon found that while the Resort had a Fair Treatment Policy, it was unable to provide details of training provided to its employees.   He described the Resort’s response to the Attendant’s sexual harassment complaint as “inept and unprofessional” and ordered it to pay her $35,490 in compensation for loss and damage, and ordered the Chef to pay her $4,500.

  • Employer Escaped Liability in Sexual Harassment Case before NSW ADT

     In the most recent case before the NSW Administrative Decisions Tribunal Cooper v. Western Area Local Health Network [2012] NSWADT 39 (9 March 2012)

    Sexual Harassment

    , a male health care worker, who was employed by the Western Area Local Health Network, was fined $10,000 for sexually harassing a colleague.

    The employer, however, has escaped liability, and was not vicariously liable because it had taken the appropriate “reasonable steps” to educate the worker about sexual harassment, including the penalties for taking such action.

    The case involved two colleagues who had worked together for 5 years and who had socialised outside work.

    At the end of a staff training day in October 2010, the male employee gave his female colleague a folded piece of paper, which she said she would read later.

    When she did read it, she said she felt “physically sick” and concerned enough about the further potential behaviour of her male colleague that she made a complaint to her local police station in Orange, in the state’s central western.

    While the Tribunal said it was not necessary to record the content of the note in its decision, the Tribunal members said the note described, “a series of actions of a sexual nature proposed to be done by a male to a female“.

    The note was unsigned and it was not obvious who had written it.

    The female employee believed the note had been written by her male colleague and was directed at her.

    The male employee argued that another person had written the note, however, the other employee was cleared of any possible breaches of the workplace Code of Conduct after investigation.

    The ADT members said they were satisfied that the case met all the necessary tests to establish that sexual harassment had occurred (and the worker had breached s.22B of the Anti-Discrimination Act 1977) in providing the note to his colleague.

    These tests, established in Sharma v. QSR Pty Ltd. t/as KFC Punchbowlinclude:

    –       proving that conduct of a sexual nature had occurred and been unwelcome,

    –       that the conduct related to the applicant, and

    –       that a reasonable person would have anticipated that the other person would have felt intimidated, offended or humiliated by the conduct.

    In considering the employer’s liability, and whether it had authorised the employee to engage in the conduct in question, or failed to take all necessary steps to prevent the conduct – the ADT warned that it, “is not enough for an employer merely to institute policies – the policies need to be implemented and brought to the attention of the employees in a meaningful way“.

    The Tribunal found that the steps taken by the employer in:

    –       regularly requiring employees to re-commit to the relevant Code of Conduct, and

    –       regularly attend training in bullying and harassment

    “were sufficient, in the sense that all steps that could have been taken were in fact taken“.

    It ordered the male employee to pay his colleague $10,000 in damages.

  • Sexual Harassment and/or Sex Discrimination Complaints in the Workplace in Australia

    Employers should recognise that the areas of risk when dealing with a sexual harassment and/or sex discrimination claim are expanding.  The way in which sexual harassment and sex discrimination complaints are being brought and litigated is increasingly becoming more sophisticated and complex.  This includes bringing claims that rely not only on the anti-discrimination legal framework, but also obligations under contract, tort and trade practices and the adverse action provisions under federal workplace relation laws.

    Sexual Harassment Sex Discrimination

    Sexual Harassment and/or Sex Discrimination Complaints in the Workplace in Australia

    Until recently, damages payouts for cases of sexual harassment and/or sex discrimination in Australia did not generally compare to the US, being by and large modest amounts.  However, the sexual harassment claim brought by Kristy Fraser-Kirk against David Jones and its CEO, Mark McInnes, gave Australian employers some concern.

    At the time, Ms. Fraser-Kirk was claiming, amongst other things, approximately $37 million in punitive damages, based upon 5% of David Jones’ profit earned from 2003 to 2010, being the time Mr. McInnes was the CEO, together with 5 % of Mr. McInnes’ remuneration and benefits earned over the same period.

    The matter never proceeded to trial, and reportedly settled out of court for $850,000.

    While significantly less than the initial multi-million dollar claim, it was still a significant amount given the trend in damages in Australia for sexual harassment claims.

    In Federal Discrimination Law, which is a publication of the Australian Human Rights Commission (2011), it was reported that damages awarded by the Federal Magistrates Court and Federal Court in sexual harassment cases pursuant to the Sex Discrimination Act 1984 (Cth), ranged from $1,000 up to $392,422, with matters at the upper end being reserved for the more serious cases.

    However, it is worth noting that claims like the one brought against David Jones and its former CEO, were not initiated using the traditional path of first making an anti-discrimination complaint under the Sex Discrimination Act with the Commission.  Rather, in conjunction with a complaint lodged with the Human Rights Commission, Ms. Fraser-Kirk’s lawyers filed directly in the Federal Court alleging, amongst other things, breach of contract, tortious duties and trade practices legislation.  The effect was to “fast track” the claim process by circumventing the Commission’s conciliatory function.

    While the David Jones case was not ultimately tested in court, Australia may see matters similarly brought forward in the future.

  • Pizza Shop on the Gold Coast – Alleged Underpayment of $20,000 – Fair Work Ombudsman Prosecution

    The Office of the Fair Work Ombudsman is prosecuting the operator of a Surfers Paradise pizza shop for allegedly underpaying 27 cooks, kitchen-hands, customer service attendants and delivery drivers almost $20,000.

    It is alleged the 27 Mondo Pizza staff were underpaid $19,093 between December 2009 and October 2010.

    Many of the workers were from non-English speaking backgrounds and were aged from 20 to 37 while working at the pizza shop.  They were allegedly underpaid minimum hourly wages, overtime and weekend penalties, with one employee allegedly underpaid evening work allowances.

    The largest amount owed to an individual employee was allegedly $2,313.

    The FWO is seeking penalties to be imposed against the company and its owner and orders for the company to pay back the alleged underpayments to the employees.

  • Workplace Investigations assist with Complaints of Sexual Harassment

    ImageSexual harassment is unwanted and unwelcome behaviour of a sexual nature. State and Federal legislation make it unlawful to sexually harass another person in the workplace.

    Sexual harassment takes place when a person makes an unwelcome advance, or engages in other unwelcome conduct of a sexual nature in relation to another person in circumstances, where a reasonable observer would have anticipated that the person would be offended, humiliated or intimidated.

    Sexual harassment can occur as a result of a single incident or a pattern of behaviour.  It can be committed regardless of whether or not the behaviour concerned was intended to cause offence, humiliation or distress.

    Sexual harassment encompasses a broad range of physical, written or verbal behaviour, which may include, but is not limited to, the following:

    • Unwelcome physical contact or attempted physical contact, e.g. kissing, touching (some of which may constitute assault);
    • Insinuations about an individual’s private life;
    • Requests for dates;
    • Insults or jokes of a sexual nature;
    • Unwelcome sexual advances, suggestions, innuendoes or requests for sexual favours;
    • Offensive printed or photographic material; or
    • Offensive information transmitted electronically, e.g. via email or the internet.

    Unless workplace issues are dealt with quickly, effectively and impartially, the effect upon the organisation may be costly in terms of loss of valuable personnel, time, money and productivity and may adversely affect your organisation’s good reputation.

    An independent, external investigator who investigates complaints of sexual harassment and provides well considered findings and recommendations, based on facts, is invaluable to any workplace.  Do not attempt to investigate internally and risk the investigation process being flawed by partiality and inability to maintain confidentialty.

    The benefits of an external, independent investigator cannot be overlooked in maintianing workplace harmony, allowing minimal disruption, and providing findings that all parties involved are more likely to accept than if the investigation were conduicted internally.

    Please feel free to contact Brooke Pendlebury today to discuss external investigation options.

  • Fair Work Ombudsman Investigation – Unregistered Apprentice and Underpayment

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    A teenager, employed as a carpenter, was allegedly underpaid more than $8,000 by a construction company in Queensland, according to a further Fair Work Ombudsman prosecution.

    JDAC Pty Ltd (JDAC), the employer and construction company, allegedly paid the full-time carpenter apprentice rates between June 2008 and February 2009, despite the fact that the employee was not formally registered as an apprentice. The employee was aged 18 and 19 years of age at the time.

    Apprentice rates may only be paid by an employer to an employee when the employee and employer have formally lodged an apprenticeship contract, and the employee is formally registered as an apprentice.

    JDAC allegedly paid the employed carpenter between $7.46 and $7.73 per hour, while he was entitled to be paid in excess of $15 per hour.

    The employee lodged a complaint with the Office of the Fair Work Ombudsman and as a result has had part of the alleged underpayment rectified.

    An order seeking the repayment of the remaining money owed shall be sought in the Brisbane Magistrates Court in May this year.

     

  • Independent Investigations in Your Workplace – Bullying, Harassment and Discrimination – Training in Your Workplace

    Brooke Pendlebury conducts investigations in your workplace to assist you in managing bullying and harassment or discrimination complaints, reduce the risk of escalation of these complaints through early intervention, and provide thorough, efficient and independent investigation findings, when necessary.

    A full and thorough investigation provides your workplace with the information needed to make effective business decisions about individuals and teams helping you target resources to improve employee relations and team culture, as well as ensure compliance with the Work Health & Safety Act 2011 (NSW).

    Brooke offers the following services:

    • Full consulting services with respect to management of staff and conflict.
    • Independent investigations into complaints between staff and management, including bullying, harassment, discrimination, victimisation.  Detailed reports are provided to your organisation at the conclusion of the investigation.
    • Supported investigations for organisations that require guidance and support through the process of internally invetsigating complaints.
    • Training in investigation skills to help your staff managing complaints internally.
    • Training in prevention and zero-tolerance, and gradual workplace culture shifts, away from bullying and harassing to respectful and productive.
    • Mediations to assist staff overcome conflict situtaions.

    Please, call Brooke today to discuss how investigations and training may assist your workplace.

  • General Protection Claims FWA

    General protections claims brought under the Fair Work Act 2009 – how you can defend these claims?  How can you pursue these claims?

    Understanding what is a workplace right, what constitutes an adverse action, and how to manage these in your workplace.