Fair Work Ombudsman cracks the whip with strategy to chase penalties and debts from employers

The Fair Work Ombudsman announced today a push to ensure court penalties and back-payment orders are upheld.

The new strategy aims to deter recalcitrant employers who ignore court orders and ensure underpaid employees receive their full back-payments.

The FWO has so far initiated around 30 legal actions enforcing back-payment orders and payment of outstanding court penalties.

These legal actions include issuing creditor’s statutory demands for payment, requiring directors to swear under oath and securing warrants for the seizure of property, land, income and revenue owned by non-compliant companies and directors.

FWO acting chief counsel Mark Davidson said in a statement most issues are solved without litigation.

“We resolve the large majority of non-compliance issues that come to our attention by assisting employers to voluntarily rectify their issues and correct their processes to ensure ongoing compliance, and no further action is necessary.

“However, where employers commit deliberate or serious contraventions, or where they refuse to cooperate, we will consider litigation,” Davidson says.

Recent cases of the FWO needing to take legal action to recover money include executing a seizure warrant on a 1970s Holden Torana owned by Jason and Kelly Bjorksten, whose company Burko Automotive and Transmissions was fined $13,200 in 2007 for underpaying a young apprentice.

Other examples included issuing legal notices to people who failed to pay penalty fines and arresting a security firm director to ensure he attended an examination hearing.

Industrial and employment lawyer with Slater and Gordon, Yasser Bakri, spoke to SmartCompany and said this FWO strategy was a positive step toward holding employers to account.

“I think there are some employers who ignore their obligations to their employees and need to be taken to court.

“In some industries there are some cowboy employers that ignore their obligations to their employees and snub their nose at the law,” Bakri says.

He says there have been a number of cases from the hospitality industry.

“The hospitality industry is one such industry where many employers pay below the minimum wage and ignore their obligations under the industrial act.

“I think the issue that is highlighted by some employers refusing to comply with court orders when they’re held to account really highlights the importance of employees safeguarding their rights,” Bakri says.

He says for many employees who are being mistreated or underpaid by their employer, stepping forward can feel confronting.

“It can be very hard for employees to rectify their rights,” Bakri says.