Former motor vehicle smash repair business operators penalised for deliberate breaches
The Fair Work Ombudsman has secured $131,268 in penalties, plus back-pay orders, in court against the former operators of a motor vehicle smash repair business in Western Sydney.
The Federal Circuit and Family Court has imposed a $113,886 penalty against ESR Group Pty Ltd, which operated ‘Essential Motor Body Smash Repairs’ in Seven Hills until the business closed, and a $17,382 penalty against the company manager, Paul Silvestro.
The penalties were imposed in response to ESR Group failing to comply with three Compliance Notices requiring it to calculate and back-pay entitlements owing to four workers it employed, and for failing to provide the workers with pay slips.
Mr Silvestro was involved in two of the Compliance Notice contraventions and the pay slip breaches.
The Court has also ordered the company to back-pay the workers a combined total of $10,924 still owed to them under the Compliance Notices, plus superannuation and interest.
The workers included three panel beaters, including an apprentice aged 19 to 20 at the time, and a spray painter.
Fair Work Ombudsman Anna Booth said employers that fail to act on Compliance Notices need to be aware they can face substantial penalties in court on top of having to back-pay workers.
“We do not tolerate the deliberate failure to act on Compliance Notices, and we will continue to take legal action to protect employees’ hard-earned wages,” Ms Booth said.
“Pay slips provide employees with the clarity they need about their pay, and we expect every employer to follow laws requiring them to be provided to an employee within one working day of each pay day.
“Employers should also be aware that taking action to protect young workers is a priority for the FWO. Any employees with concerns about their pay or entitlements should contact us for free advice and assistance,” Ms Booth said.
The FWO investigated after receiving requests for assistance from the affected workers, who were employed full-time by ESR Group for various periods between March 2020 and December 2021.
Fair Work Inspectors issued three Compliance Notices to ESR Group between August 2021 and August 2022 in response to the company failing to pay the workers’ accrued but untaken annual leave entitlements when their employment ended, owed under the Fair Work Act’s National Employment Standards.
In addition, two of the workers were not paid any wages for some work performed, owed under the Vehicle Repair, Services and Retail Award 2020, and one worker was not paid personal leave entitlements.
Judge Nicholas Manousaridis said that despite the company and Mr Silvestro admitting to the contraventions, the “admissions have not been met by action” and “significant amounts” are still owed to the workers because of the “deliberate” failure to comply with the Compliance Notices.
“Also relevant is the fact that ESR has failed to comply with three Compliance Notices. That manifests a strong propensity to act in defiance of industrial laws; and the assessment of pecuniary penalties should be set at a level that will eliminate such propensity,” Judge Manousaridis said.
His Honour also found that ESR Group’s failure to issue pay slips to the workers was “persistent intentional action” and a “complete disregard” of the Fair Work Act.
Judge Manousaridis said the penalties imposed needed to be at the “higher end of the scale” to deter Mr Silvestro and other employers from similar “contravening conduct”.
Employers and employees can visit www.fairwork.gov.au or call the Fair Work Infoline on 13 13 94 for free advice and assistance about their rights and obligations in the workplace. An interpreter service is available on 13 14 50. Employees can also seek information from their employer or their union, if they are a member.
The FWO provides a free online course to help employers understand what a Compliance Notice is and how to respond if they get one. The Compliance Notice course, among a suite of free interactive courses on offer for employers, managers and employees, is available in our online learning centre.
Small businesses can find targeted resources at the Small Business Showcase and information is available for employees and employers at our young workers and students and apprentices and trainees webpages.
