Home' Hotel Management : HM AUGUST 2016 Contents UNDERPAYMENTS COMING OUT
OF YOUR OWN BACK POCKET
Not only may individuals be personally liable for penalties in relation to
breaches of the Fair Work Act 2009 (Cth), but a recent decision handed down
by the Federal Circuit Court has ordered the director of a security company
to personally repay eight underpaid casual security guards, with the total
amounting over $20,000.
Step Ahead Security Services Pty Ltd ("Step Ahead Security Services")
operated a security business which provided security guards for static and
mobile patrols. Mr Jennings is the sole director of Step Ahead Security
Services. Between May 2014 and August 2014, Step Ahead Security Services
employed eight casual employees to work as security guards.
Following an audit conducted by the Fair Work Ombudsman ('FWO'), the
FWO determined that the employees had been underpaid.
The employees were employed on the basis that they would be paid a flat
rate for all hours worked, disregarding the entitlements the employees were
entitled to under the Security Services Industry Award 2010 (the "Award").
Paying the employees in that way, without regard to the rates of remuneration
set out in the Award or to the various loadings and other entitlements is a
contravention of the Fair Work Act 2009 (Cth).
The Court held that Mr Jennings was the controlling mind of Step Ahead
Security Services and that he was well aware of the requirements of the
Award, having had previous dealings with the FWO relating to underpayment
of wages and entitlements. The Court determined that Mr Jennings
demonstrated calculated and deliberate conduct which plainly amounted
to a blatant disregard for Australia's workplace laws and the rights and the
entitlements of the employees.
While the underpayments caused significant financial hardship to the
employees a ected, the Court also took into consideration that Mr Jennings
and Step Ahead Security Services showed no contrition and failed to
apologise for the contraventions.
The Court ordered that Step Ahead Security Services and Mr Jennings were
jointly and severally liable for the underpayment. However given that Step
Ahead Security Services was, at the time of the judgment, in the process of
being wound-up this meant that responsibility for the underpayment was likely
to fall on Mr Jennings. Additionally, the Court imposed an injunction restraining
Mr Jennings from underpaying security industry workers in the future.
Penalties of more than $308,000 were also imposed on both Step Ahead
Security Services and Mr Jennings, with Mr Jennings ordered to pay $51,400
(25% of which was suspended unless and until the legislation was contravened
within five years) and Step Ahead Security Services in the amount of $257,000.
Acting Fair Work Ombudsman Mark Scully has commented on rogue
business operators that think they can short-change their employees saying
they should think again before thinking about hiding behind a corporate veil
because the FWO will seek to lift it.
This case further reinforces that Courts are willing to impose significant
penalties on both corporations and individuals and even go as far as imposing
personal liability for compensation on individuals considered to be directing
minds in an organisation if that individual consciously disregards Australian
workplace laws. Employers and persons within an organisation who are
responsible for compliance with Australian workplace laws should not only
be aware of their obligations (corporate and individual) under Awards and
legislation, but also take all steps in order to comply with these obligations.
By Elizabeth Kenny, Associate with People + Culture Strategies, WPR Legal
at Accommodation Association of Australia
AAoA and ATHOC
The Accommodation Association of Australia (AAoA) and the Australian
Timeshare and Holiday Ownership Council (ATHOC), the main body for
the timeshare industry, have signed a formal alliance between the two major
"The new Accommodation Association-ATHOC alliance will help to unite
the entire accommodation industry in all political, industrial and commercial
forums," said AAoA President, Julian Clark.
"For many years, the Accommodation Association has endeavoured
to establish strong working relationships with other representative bodies
for the tourism and accommodation industries, through both formal and
"The more the accommodation industry can speak with one voice to
government -- and other key external stakeholders -- the lower the regulatory
risk to the industry," he said.
The Accommodation Association-ATHOC alliance adds to the
Accommodation Association's existing formal membership agreements with
the Australian Resident Accommodation Managers Association (ARAMA),
the Caravan Industry Association of Australia (CIAA), the Caravan and
Camping Industry Association (NSW) (CCIA) and the administrative support
the Accommodation Association provides to the Motor Inn and Motels
Association of Australia.
"Combined with our close connection with the Backpacker Operators
Association and Hosted Accommodation Australia, this is another step
forward in securing the interests of one of Australia's leading employment
sectors," Clark said.
ATHOC President (and Managing Director of Wyndham Vacation Resorts
Asia Pacific), Barry Robinson said: "This is a fantastic outcome for Australia's
"ATHOC and the Accommodation Association have enjoyed a terrific
working relationship for years and ATHOC looks forward to assisting the
Accommodation Association with an enhanced presence in Queensland,
delivering even more benefits for members of both organisations," he said.
The alliance, that commenced on Friday 8 July, will see the Accommodation
Association and ATHOC share membership benefits, events, o ce space and
resources, among other things.
Sharing resources means the role of ATHOC General Manager,
Laura Younger is being expanded to include her leading support for the
Accommodation Association in Queensland.
In addition, Robinson has become a Director of the Accommodation
Association to ensure regulatory challenges facing the timeshare industry
continue to be addressed in a strategic manner which minimises risk and
maximises outcomes for operators of timeshare businesses.
Deal done: Barry Robinson and Julian Clark
14 HM The Business of Accommodation
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