‘Deliberate failure to act on compliance’ results in $131k in penalties

The Fair Work Ombudsman (FWO) has secured $131,268 in penalties in court against the former operators of a western Sydney-based motor vehicle smash repair business.

After investigations by the FWO, ESR Group, which operated “Essential Motor Body Smash Repairs”, was penalised $113,886 in the Federal Circuit and Family Court, while the company manager, Paul Silvestro, was penalised $17,382 penalty.

The penalties were imposed after the company failed to comply with three compliance notices requiring it to calculate and back pay entitlements owing to four workers it employed and for failing to provide the workers with pay slips.

“We do not tolerate the deliberate failure to act on compliance notices, and we will continue to take legal action to protect employees’ hard-earned wages,” said Fair Work Ombudsman Anna Booth.

According to the FWO, Silvestro himself was directly involved in two of the compliance notice contraventions and the pay slip breaches.

The workers affected included a young apprentice, three panel beaters and a spray painter. The court ordered the company to back pay these workers a combined total of $10,924 still owed to them, including superannuation and interest.

“Pay slips provide employees with the clarity they need about their pay, and we expect every employer to follow laws requiring them to be provided to an employee within one working day of each pay day,” said Booth.

“Employers should also be aware that taking action to protect young workers is a priority for the FWO. Any employees with concerns about their pay or entitlements should contact us for free advice and assistance.”

The FWO originally began its investigation after being contacted by the affected workers. From then, three compliance notices were issued to the company between August 2021 and August 2022 in response to the company’s failure to pay the workers’ accrued annual leave. In addition to these breaches, two of the workers were not paid any wages for some work performed under the services award.

Judge Nicholas Manousaridis, who oversaw the case, said that although the company and Silvestro admitted to the contraventions, the “admissions have not been met by action” and “significant amounts” are still owed to the workers due to the“deliberate” failure to comply.

“Also relevant is the fact that ESR has failed to comply with three compliance notices. That manifests a strong propensity to act in defiance of industrial laws, and the assessment of pecuniary penalties should be set at a level that will eliminate such propensity,” said Manousaridis.

Manousaridis announced that the penalties imposed had to be at the “higher end of the scale” to deter Silvestro and other employers from similar “contravening conduct”.