A small business has been fined $19,800 and ordered to backpay $12,500 after failing to pay annual leave loading to an employee in accordance with the Shop, Distributive and Allied Employees Association - Victorian Shops Interim Award 2000.
Following a complaint made by the employee to the director of the company that she believed she was entitled to annual leave loading and was being underpaid, the director conducted his own research of the WageNet website and obtained information from the Australian Retailer's Association. After reviewing the information, the director maintained the mistaken view that the employee had not been underpaid and was not entitled to annual leave loading.
The director accused the employee of speaking to other employees about the rates of pay and said that the employee could no longer be trusted. The director dismissed the employee a few days after she made the complaint on the basis that the she had "not worked as a team member" and had "displayed unrest".
The employee subsequently made a complaint to the Workplace Ombudsman and proceedings were issued against the company for breaches of the Workplace Relations Act 1996 (Cth) (Act). The company paid the employee the backpay she was entitled to, admitted to wrongfully dismissing the employee and agreed by consent to pay the employee an amount representing the financial loss suffered by the employee as a result of the dismissal, constituting approximately 16 weeks' pay.
The Court said that whilst it accepted that the breach had not been deliberate, ignorance of the law is not grounds for a discounted penalty as employers have a responsibility to make enquiries to find out what their employees are entitled to and what is required of them. The Court ordered the employer to pay a penalty of $19,800 out of a maximum of $33,000 that could have been ordered under the Act.
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