The Fair Work Ombudsman has secured $8,491 in penalties in court against a home construction contract company in Melbourne and its director.
The Federal Circuit and Family Court has imposed a $7,076 penalty against Local Builders Direct Pty Ltd, which has an office in Ravenhall and a display home centre on a site in Diggers Rest, and a $1,415 penalty against the company’s sole director and shareholder, Angelo Adamo.
The penalties were imposed in response to Local Builders Direct failing to comply with a Compliance Notice requiring it to calculate and back-pay entitlements in full to a worker it employed as a sales consultant between November 2020 and May 2021. Mr Adamo was involved in the contravention.
Local Builders Direct back-paid the worker the entitlements owing to her in full only after the Fair Work Ombudsman commenced legal action.
Fair Work Ombudsman Sandra Parker 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 are prepared to take legal action to ensure workers receive their full lawful entitlements. Any employees with concerns about their pay or entitlements should contact us for free advice and assistance,” Ms Parker said.
The FWO investigated after receiving a request for assistance from the affected worker.
A Fair Work Inspector issued a Compliance Notice to Local Builders Direct in July 2021 after forming a belief that the worker had been underpaid minimum wages and payment in lieu of notice of termination, as well as personal and annual leave entitlements, under the Miscellaneous Award 2020 and the Fair Work Act’s ³Ô¹ÏÍøÕ¾ Employment Standards.
Local Builders Direct responded by partially back-paying the worker, but did not comply with the Compliance Notice which required the company to rectify the underpayments in full, plus superannuation and interest.
Judge Amanda Mansini found the company’s failure to fully comply with the Compliance Notice was deliberate and that the partial back-payment “did not constitute compliance.”
“The failure to comply with a statutory notice issued by the FWO is serious and such conduct ultimately undermines the (Fair Work) Act’s enforcement framework and the safety net of entitlements it is designed to protect,” Judge Mansini said.
Judge Mansini said the penalty should deter Local Builders Direct, which continues to trade, from similar future conduct and “impress upon other employers the importance of complying with the legal obligations owed to their employees.”
