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Compliance and enforcement outcomes

The compliance and enforcement outcomes that resulted from the campaign included:

  • 12 formal cautions
  • 14 infringement notices were issued totalling $6 660
  • four compliance notices were issued recovering $31 324.17 for 20 employees
  • three litigations1.

Case study – Formal Caution

Twelve formal cautions were issued to employers during the campaign. Formal cautions are a written warning issued to an employer when the FWO has found non-compliance and seeks to put a business on notice that future non-compliance could result in the FWO seeking financial penalties. If the FWO becomes aware of any further instances of non-compliance, the fact the business was issued with a formal caution will be taken into account in deciding whether to commence civil proceedings against the business and may be used as evidence in any penalty determinations.

Fair Work Inspectors audited an architectural firm in the Albany-Manjimup region and found that there were inconsistencies with some aspects of their record keeping, in particular, a lack of records concerning hours worked as overtime. The business offered employees time off in lieu (TOIL) of payment for any overtime worked, however they had not kept records regarding the amount of overtime their staff had accrued.

In discussing the matter with the office manager, inspectors were advised that the business took an informal approach to these records due to the small size of the business and the good relationships between staff and management.

The director of the business was advised of her obligations to keep time records, particularly regarding TOIL. The business was issued with a Formal Caution detailing the obligations of the business as an employer under the FW Act.

Case study – Infringement notice

Fourteen infringement notices were issued to employers during the campaign resulting in the payment of $6 600 in fines. An Infringement Notice is a fine given to a business for non-compliance with record-keeping or pay slip requirements of the Act and the Regulations.

Fair Work Inspectors audited a hairdressing business in the Southern Perth region. After receiving limited co-operation from the employer initially, a Notice-to-Produce was issued to recover the time and wage records from the business.

Upon receiving the records, it became apparent that the time records were insufficiently kept, pay slips were not provided to staff and pay records were not kept. This was a breach of the Regulations. As the inadequately kept records made it difficult for inspectors to accurately test for compliance against the Award, the business was issued with an Infringement Notice and fined $900.

Case Study - Compliance notices

Four compliance notices were issued to employers during the campaign. A compliance notice is a written notice legally requiring a business to rectify breaches of the Act. Failure to comply with a compliance notice results in the FWO commencing legal proceedings where it can seek significant financial penalties against a business. A total of $31 324.17 was recovered from four businesses for 20 employees as a result of the compliance notices issued.

Fair Work Inspectors audited a winery in the Albany-Manjimup region. While assessing the wage records, they discovered that workers were being paid a flat hourly rate that was below the minimum award rate under the Wine Industry Award 2010. They were also working weekends and public holidays with no additional penalty rates.

Inspectors calculated the wages paid to three members of staff and determined an underpayment of $8 750.63. A Compliance Notice was issued to the employer requiring the rectification of all wages denied. The Compliance Notice was complied with.

Case Study - Litigation

Three litigations were filed against businesses during the campaign due to the seriousness of the non-compliance uncovered. Litigation is a legal process where the FWO files against a company and/or individual in a court of law seeking financial penalties against the employers for allegedly breaching the Fair Work Act 2009. Litigation is the most significant enforcement tool used by FWO and is reserved for those serious matters that are in the public interest as detailed in the FWO Litigation Policy.

Litigation against Phua and Foo Pty Ltd and Tac Pham Pty Ltd trading as Han's Cafe

In 2017, the FWO commenced proceedings against two Han’s Café franchisees as a result of the campaign’s findings:

- Phua and Foo Pty Ltd, the legal entity operating a Han's Cafe franchise, located at Jull Street in Armadale;

   and

- Tac Pham Pty ltd, the legal entity operating a Han's Cafe franchise, located in Rockingham.

Fair Work Inspectors found that both franchisees were paying flat rates of pay to staff that were insufficient to cover minimum entitlements under the Restaurant Industry Award 2010.  Employees at both of the franchises were employed in various roles including kitchen attendants, cooks and food and beverage attendants.

All workers at both outlets have been back-paid in full as a result of the legal action.

Phua and Foo Pty Ltd - Armadale outlet

Phua and Foo Pty Ltd had underpaid 27 employees $67 161 over nine months at the Armadale outlet, including one junior aged 18-19. On 22 February 2018, penalties amounting to $35 000 were imposed against the business Phua & Foo Pty Ltd. In addition, an order was made by the Court requiring the company to arrange workplace relations training for its managerial staff.

The court found the conduct was serious because it was the product of a deliberate decision by the company to deny weekend penalty rates. 

Tac Pham Pty Ltd - Rockingham outlet

Tac Pham Pty Ltd had underpaid 22 employees, an amount of $27 920 at the Rockingham outlet, including nine juniors aged between 17-19 and seven overseas workers, mostly international students from Vietnam. The Rockingham outlet also contravened pay slip laws.

On 22 February 2018, the court imposed a penalty of $37 500 against the Rockingham business Tac Pham Pty Ltd and a separate amount of $7 500 against the General Manager, Ms Cuc Ti Thu Pham.

In imposing the penalties, the court balanced the seriousness of the conduct, the vulnerability of the employees, and Ms Pham’s reckless disregard of workplace obligations, against the Respondents’ contrition, cooperation and rectification.  

The underpayments at the Rockingham outlet occurred despite the FWO having advised Mrs Pham and Tac Pham Pty Ltd in 2013 about minimum award wages after receiving an underpayment allegation from a worker. Justice Siopis found that Mrs Pham “simply chose to disregard her dealings with the FWO in November 2013 and continued to operate the defective wages payment system which she had inherited, recklessly indifferent as to whether she was, thereby, compliant with the Restaurant Award conditions.”  The judge set the penalties against the business and Mrs Pham as a consequence of the serious nature of the breaches and to deter other café/restaurant owners from disregarding legal minimums. The judge also ordered workplace relations training for managerial staff.

Litigation against Sureguard Security Pty Ltd

In 2017, the FWO commenced proceedings against Sureguard Security Pty Ltd, a security services company, operating in Rockingham.

During the campaign, Inspectors found that the security guards employed by the business were being paid flat rates of pay with no penalties, shift loadings or other entitlements, however, the flat rate paid was not high enough to cover the penalty and shift loadings that should have been paid. 

The security guards, including 13 who performed permanent night shifts, were paid a flat hourly rate between $21.50 and $24 for static guard work and $25 for patrol work. This led to the security guards being underpaid the minimum hourly rates, including numerous penalties, loadings and overtime payments contained in the Security Services Industry Award 2010.

Underpayments for individual workers ranged from $227 to $20 174.  As a result of audits undertaken during the campaign, Sureguard back-paid 22 employees a total of $205 408.40 it had underpaid them between December 2014 and January 2016. It did this once the legal action had commenced.

On 22 December 2017, the court imposed a penalty of $81 720 against Sureguard Security Pty Ltd (the Company) and its sole Director, Mr Gary Crowther. In his judgement on the matter, Justice Michael Barker dismissed Sureguard’s submission that it thought paying flat rates above the lawful minimum for ordinary hours would counteract the different rates of pay for other periods as “at best, a misunderstanding of the law, but a lame excuse” and that whilst there may not have been a deliberate plan to circumvent the law, there was no real excuse for the contraventions, which occurred without regard to the minimum award requirements. Justice Barker also ordered Suregard to commission workplace relations training for its managers.


1. FWO Media Release, Sureguard Security Pty Ltd, 20 February 2018.

    FWO Media Release, Han's Cafe Armadale and Rockingham franchise outlets, 20 March 2018.