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$40k fine for business which ignored a compensation order

Grace Ormsby
18 April 2019 1 minute readShare

A Queensland electrical contracting company and its director have been penalised nearly $40,000 for ignoring a compensation order for a terminated employee.

The Fair Work Commission had originally ordered the employee to be compensated after being satisfied that the 26-year-old worker was unfairly dismissed back in 2017.

The affected refrigeration and air-conditioning mechanic had been in the role for five years, and the commission noted the employee’s termination as harsh, unjust and unreasonable.

An order was subsequently made that required the company, Logan City Electrical Service Division Pty Ltd, to pay the employee $19,640 (gross income) and 9.5 per cent commission.

When the compensation was not paid, the employee contacted the Fair Work Ombudsman to seek assistance in the matter.

The Ombudsman took the matter to court, resulting in the Federal Circuit Court penalising the company $32,760 and sole director Peter Burnitt $6,552.

The company was noted as paying out the compensation only once legal action had commenced against it.

For Australian government’s Fair Work Ombudsman, Sandra Parker, ignoring the orders of the Fair Work Commission is not an option.

“The Fair Work Ombudsman has secured penalties against several employers for failing to pay unfair dismissal compensation ordered by the Fair Work Commission,” Ms Parker warned.

She noted it as “fundamental to the integrity of the workplace relations system” that commission orders are enforced.

“We will take court action, particularly when [commission orders] involve compensation for vulnerable employees,” Ms Parker continued.

The decision comes after an August 2018 matter where a Brisbane-based company and owner was fined more than $120,000 for failure to comply with a compensation order, also in an instance where an employee had been unfairly dismissed.

$40k fine for business which ignored a compensation order
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Grace Ormsby

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