Australian Building and Construction Commissioner v J Hutchinson Pty Ltd T/A Hutchinson Builders
Citation: [2019] FCA 667
At a glance
- Penalty
- $20,000
- Employees affected
- 10
What happened
On 9 December 2013, during an unprotected industrial action, 10 employees of Hutchinson Builders ceased work. The company failed to deduct four hours' pay from each employee as required by s 474 of the Fair Work Act. Instead, the company paid full wages in the pay period following the action. Deductions were made months later.
What was decided
The Federal Circuit Court found 10 contraventions of s 474 and imposed a penalty of only $1,200. On appeal, the Federal Court set aside the penalty as manifestly inadequate. Applying proper deterrence principles, the Court imposed a new penalty of $20,000 ($2,000 per contravention).
What it means for employers
During unprotected industrial action, employers must deduct wages from participating employees in the first pay period following the action. Failure to do so promptly breaches the Fair Work Act. Courts apply strong deterrence principles to such breaches. Penalties should reflect the seriousness of the breach and deter similar conduct.
What it means for employees
Employees engaging in unprotected industrial action may have wages deducted. Employers must make such deductions in the first pay period following the action, not months later. Delays in making deductions may indicate employer non-compliance with the law.
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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 →