Fair Work Ombudsman v Eastern Colour Pty Ltd (No 2)
Citation: [2014] FCA 55
At a glance
- Employees affected
- 4
- Awards cited
- MA000235
What happened
Between 2008 and 2012, several fruit pickers worked at a farm owned by Eastern Colour Pty Ltd (Eastern Colour) in Applethorpe, Queensland. The Fair Work Ombudsman (FWO) alleged that Eastern Colour failed to pay overtime and penalty rates to these workers. the director of Eastern Colour managed the farm's operations alongside her partner. Two other companies, SB Employments Pty Ltd (SB) and NB Employments Pty Ltd (NB), were purportedly involved in employing the workers. The sons of Antonio and Louisa Baronio were sole directors of SB and NB respectively. Workers believed they were employed by Eastern Colour, wearing shirts with its logo and having limited knowledge of SB and NB.
What was decided
The Federal Court found that Eastern Colour was the true employer of the fruit pickers, not SB or NB. The court determined that a scheme was in place to avoid paying overtime obligations. the director of Eastern Colour was aware of the legal obligation to pay overtime. The court ruled Eastern Colour contravened the Workplace Relations Act 1996 and relevant clauses of the Fruit and Vegetable Growing Industry Award. The FWO’s case against SB, NB and a witness (Mr Catanzaro) was discontinued. Orders were made for counsel to bring in signed minutes of orders.
What it means for employers
Employers must accurately identify who is their employee. Using related companies to avoid legal obligations, such as paying overtime, will not be tolerated. Employers need to ensure they are complying with all relevant legislation and awards, including those relating to overtime and penalty rates. The court’s decision highlights the importance of substance over form when determining employment relationships.
What it means for employees
Employees should understand who their employer is and what entitlements they are entitled to. If employees suspect an employer is attempting to avoid paying them proper wages or benefits, they can raise concerns with the Fair Work Ombudsman.
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This summary was drafted from the published decision and reviewed before publishing. It is general information, not legal advice. For your specific situation, speak to the Fair Work Ombudsman (13 13 94) or a qualified lawyer. About these summaries & corrections →