The Fair Work Ombudsman has secured $22,536 in penalties against the operators of a Brunswick adult retail store after they failed to comply with a legal direction to calculate and back-pay a young employee.
The Federal Circuit and Family Court ordered Sempha Solutions Pty Ltd, which operates La La Land in Melbourne’s inner north, to pay $18,780 and imposed a $3,756 penalty on the company’s sole director, Simon Paul Herman.
The penalties followed Sempha Solutions’ breach of the Fair Work Act for failing to comply with a Compliance Notice that required it to calculate and back-pay any minimum wages, overtime entitlements and penalty rates owed to a casual store manager employed between September 2022 and April 2023. The worker was then aged 22 to 23. Mr Herman was involved in the contravention.
In addition to the penalties, the Court ordered Sempha Solutions to comply with the Compliance Notice, including calculating and rectifying any underpayments, plus superannuation.
Fair Work Ombudsman Anna Booth said companies that failed to act on Compliance Notices risked court-imposed penalties as well as back-pay orders. “When Compliance Notices are not followed, we are prepared to take legal action to ensure workers receive their lawful entitlements,” Ms Booth said. “Employers also need to be aware that taking action to protect young workers is among our top priorities. “Any employees with concerns about their pay or entitlements should contact us for free advice and assistance.”
The watchdog opened its investigation after a request for assistance from the worker. A Fair Work Inspector issued a Compliance Notice to Sempha Solutions in October 2023 after forming a belief the worker was underpaid minimum wages, overtime entitlements and penalty rates under the General Retail Industry Award 2020.
In her judgment, Judge Amanda Mansini found the company’s failure to comply with the notice was serious and said such conduct undermined the Act’s enforcement framework and the safety net entitlements it was designed to protect. She said penalties were needed to deter the company and other employers from future breaches. “There is a need for general deterrence in this matter, to emphasise the importance of an effective compliance framework and at a sufficient level to impress upon other employers, particularly in the retail industry, the importance of complying with the legal obligations owed to their employees,” Judge Mansini said.
The Fair Work Ombudsman provides guidance for employers on responding to Compliance Notices and resources targeted at small businesses, while young workers can access information about their workplace rights via the agency’s website.
