Kulpreet Singh, the former manager and part-owner of United Petroleum at Marrangaroo, near Lithgow in central western NSW, and his company Noorpreet were found to have withheld paid parental leave funds to an employee who worked as a chef at the roadhouse.
It marks the first time an employer has faced legal action instigated by the Fair Work Ombudsman (FWO) for not paying parental leave entitlements.
After the then-29 year old worker gave birth, the Department of Human Services (DHS) transferred $11,538 in funds to Noorpreet in April 2015 under the government’s paid parental leave scheme.
However, the employee never received the money, despite Mr Singh suggesting he had paid the amount in cash to the chef’s husband.
The DHS received a complaint from the woman, but after unsuccessful attempts to address the situation, referred the case to the FWO.
Initially, Mr Singh provided a document which he claimed proved he had paid the funds in cash, but this document was subsequently found to be false. He eventually paid the employee the funds in October 2015 — five months after they were due to have been paid.
In the Federal Circuit Court, Judge Nick Nicholls said Mr Singh had “lied” and that the failure to transfer the funds amounted to “an express and active intervention” to deprive the employee of her entitlements.
“Mr Singh was, to be blunt, well and truly caught out by the FWO, perpetrating a deliberate falsehood in relation to the false payment record,” the judge concluded.
He was handed a personal fine of $19,720, while his business Noorpreet was penalised a hefty $98,700.
“New parents have enough on their minds without having to chase recalcitrant employers over their taxpayer-funded paid parental leave,” Fair Work Ombudsman Natalie James said in response to the verdict.
“Any employer thinking they can cover up breaches of work laws by creating false records or lying to Fair Work Inspectors — beware,” she said.
“There are new higher penalties for record-keeping breaches and the risk of criminal prosecution for this self-serving and fraudulent conduct.”
According to the FWO, failing to keep employee records or issue pay slips now attracts penalties of up to $63,000 for a company and $12,600 for an individual, and the maximum penalty for knowingly making or keeping false or misleading employee records has tripled to $12,600 for an individual.