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Employment Law, Employment or Business Issues

Fair Work Breaches and Third Party Accessories

In the recent decision in Fair Work Ombudsman v Blue Impression Pty Ltd & Ors the Fair Work Ombudsman (FWO) has named a third party an accessory to contraventions of the Fair Work Act (FWA).

Blue Impression failed to pay the minimum hourly rate of pay to its employees, or provide meal breaks as required under the relevant award. The accounting firm which undertook the accounting work for Blue Impressions was liable as an accessory to these contraventions under the FWA.

Under s 550(1) of the FWA a person who is ‘involved in’ a contravention of a civil remedy provision is taken to have contravened that provision. A person is involved in a contravention of a civil remedy provision if the person has:

  • Aided, abetted, counselled or procured the contravention: s550(2)(a);
  • Induced the contravention, whether by threats, promise or otherwise: s550(2)(b);
  • Been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to the contravention: s550(2)(c);
  • Conspired with others to effect the contraventions: s550(2)(d);

A person for which this section applies can either be an individual of a corporate entity.

The next question is, what does it require to be involved in and knowingly concerned in a statutory convention. This has been set out in the above mentioned case as follows:

  • There is a practical connection between that person and the contravention;
  • The person must have been, at the time of the contravention, an intentional participant with actual knowledge of the essential elements constituting the contravention;
  • However, actual knowledge can be inferred from a combination of:
    • A person’s knowledge of suspicious circumstances; and
    • That person’s decision not to make enquiries to remove those suspicions.

The above implication is that a person is unable to raise a defence merely by saying they did not know due to being a third party and not directly involved. If on the balance of probabilities, the third party knew or ought to have known through further obvious investigations, then they will be held liable as an accessory to the FWA breach.

This further establishes the legal maxim that ignorance is not defence to a contravention.

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