Unlawful JobKeeper cashback penalised

22 February 2022

The Fair Work Ombudsman has secured a $14,000 penalty in court against the operator of a Queensland transport business for implementing an unlawful cashback requirement involving JobKeeper payments.

The Federal Circuit and Family Court has imposed the penalty against Khan Andrew Buchanan, a sole trader who operates RiverCity Bus Service, a school and charter bus business servicing passengers in and around the Brisbane and Logan areas.

The penalty was imposed in response to Mr Buchanan’s conduct in relation to a bus driver he employed on a casual basis between 2017 and 2020.

For the period between March and September 2020, Mr Buchanan received fortnightly $1500 gross JobKeeper payments from the Commonwealth Government for the driver and transferred these payments in full, minus relevant tax, to the driver’s bank account.

The JobKeeper payments were more than the driver’s usual fortnightly wages.

Mr Buchanan then breached the Fair Work Act by requiring the driver to pay each week to Mr Buchanan an amount roughly equal to the difference between the net JobKeeper payment he received into his bank account and his wages received for hours worked in the previous week.

In total, Mr Buchanan unlawfully required the driver to repay him a total of $5805 in JobKeeper payments.

Mr Buchanan also committed a further breach of the Fair Work Act on one occasion, in September 2020, when he received a $1500 JobKeeper payment from the Commonwealth Government but paid the driver only $1035.60 of the payment, failing to satisfy the JobKeeper wage condition by the end of this JobKeeper fortnight.

Fair Work Inspectors investigated after the driver lodged a request for assistance. After Inspectors contacted Mr Buchanan, he rectified the underpayments in full last year, back-paying the employee a total of $6270.40.

Fair Work Ombudsman Sandra Parker said the regulator was prepared to take action to uphold the integrity of government programs.

“The deliberate failure to follow the law on how publicly-funded JobKeeper payments had to be used is disappointing. Cashbacks are treated particularly seriously by the Fair Work Ombudsman as they can imply a deliberate attempt by an employer to mislead the regulator. We will not tolerate any employers requiring workers to pay back any of their wages except where it is allowed by law,” Ms Parker said.

“Any employees with concerns about their pay or entitlements should contact us for free assistance,” Ms Parker said.

Judge Salvatore Vasta described Mr Buchanan’s conduct as “reprehensible”, “deliberate” and “calculated” and found Mr Buchanan had taken advantage of the driver and not apologised.

“Deterrence is the major factor in setting the appropriate pecuniary penalty and it is so even though the JobKeeper scheme has now ended. The trust that the government gave to (Mr Buchanan), in giving him payments to pass on to the employee, as well as the trust the employee had in (Mr Buchanan), has been breached in a most callous and despicable manner,” Judge Vasta said.

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. A free interpreter service is available on 13 14 50.

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Media inquiries:

Ryan, 0411 430 902, media@fwo.gov.au