FWO issues $243,000 penalties for underpayments, false records

The Federal Circuit Court has ordered A & S Wholesale Fruit and Vegetables, which trades as Parkmore Fruit and Vege Market and Melbourne MarketPlace, to pay $200,000 in penalties.

Stephen Fanous, the director of the company, and its operations manager Etherah Louli, have also been ordered to pay $30,000 and $13,000 in penalties, respectively. 

The FWO revealed that between 2012 and 2014, the company underpaid three workers $132,956 through the use of varying flat rates of pay of between $10 and $18.52 per hour. 

For two of the employees there was an ‘off the books’ and ‘on the books’ payment system for certain hours or periods of their employment.

Fair Work Ombudsman Sandra Parker said the significant penalties send a strong message to all employers that unlawfully low flat rates were unacceptable and would be detected.

"We have no tolerance for employers who think they can choose to pay workers a flat rate of pay that undercuts a worker's minimum entitlements, or who try to hide it with unlawful 'off the books' practices," Ms Parker said.

"Accurate and timely record-keeping is a fundamental obligation of any employer and whenever we find false records we will consider court action, with increased penalties now available."

All three workers were underpaid minimum entitlements under the General Retail Industry Award for ordinary hours, penalty rates and overtime.

The FWO said that the company has rectified the underpayments in full following the commencement of court action.

Judge John O'Sullivan said the company and its senior managers’ conduct was “serious”, with the underpayments “substantial” and continuing across an extended period, while the record-keeping contraventions, the production of false or misleading records being the “gravest” of the contraventions, made determining the underpayment amounts difficult.

"The [company's] failure to make proper records, [keeping of] false employment records and failure to make timely provision of accurate pay slips to the employees, undermines the utility and fundamental objectives of the [Fair Work Act]," Judge O'Sullivan said.