Builders summonsed to court over alleged underpayments

builders

The Fair Work Ombudsman has commenced legal action in the Federal Circuit Court against the operators of a building business in Victoria after one of its employees contacted the FWO for assistance. An investigation was carried out that led to the Carrum Downs business, L.E.C. Builders & Designers Pty Ltd, and its sole director, Luke John Elliot, facing legal action.

The FWO issued a Compliance Notice in December 2000 after its investigation revealed that the worker had been underpaid entitlements under the Building & Construction General On-site Award 2010, including his minimum hourly rates, fares and travel pattern allowance and annual leave entitlements.

The FWO alleges L.E.C. Builders & Designers, without reasonable excuse, failed to comply with that Notice and did not back-pay the worker’s outstanding entitlements as ordered. The FWO also alleges that Elliot was involved in the failure to comply with the order.

In line with the FWO’s proportionate approach to regulation during the COVID-19 pandemic, the Ombudsman tried on several occasions to persuade the company to voluntarily comply with their Compliance Notice, and only commenced legal action when these efforts were ignored.

Fair Work Ombudsman Sandra Parker stressed that her office will toenforce workplace laws and use all legal avenues open to them when Compliance Notices are not complied with.

“Compliance Notices are important tools used by inspectors to deal with apparent contraventions of the Fair Work Act or industrial instruments, most typically Modern Awards,” Parker said. “Where employers do not respond to or comply with these Notices, we will take appropriate enforcement action to protect employees. A court can order a business to pay penalties for not complying with such a Notice, in addition to back-paying workers as appropriate.

“Any employees with concerns about their pay or entitlements should contact the Fair Work Ombudsman for free assistance,” Parker added.

L.E.C. Builders & Designers Pty Ltd company faces a potential maximum potential penalty of up to $33,300 and Elliot could be fined up to $6660 as a result of the court action.

The FWO is also seeking a court order that will enforce the action required by the Compliance Notice, meaning the company would need to calculate and rectifying underpayments in full, plus superannuation. A directions hearing will be heard at Melbourne’s Federal Circuit Court on 30 July 2021.