The Industrial Magistrates Court (IMC) found that ARC Holdings (WA) Pty Ltd (first respondent; ARC Holdings) and its sole director (second respondent) deliberately failed to comply with a compliance notice issued by an industrial inspector at the Department of Energy, Mines, Industry Regulation and Safety (the Department). The industrial inspector issued the compliance notice on 8 May 2023 to ARC Holdings (the Compliance Notice) and required ARC Holdings to pay $9,345.21 to a former employee for unpaid pro rata long service leave and provide evidence to the Department of the payment by 6 June 2023. ARC Holdings did not make the payment until September 2024, well after the deadline, and also did not provide evidence of that payment to the Department.
The claimant, another industrial inspector at the Department, brought the claim under sections 83E(1) and 84T(2) of the Industrial Relations Act 1979 (WA) (IR Act) and sought penalties for the following alleged contraventions:
- the first respondent breached section 84T(1) of the IR Act, which requires compliance with a compliance notice; and
- the second respondent was a person knowingly involved in the first respondent’s contravening actions.
ARC Holdings admitted it failed to comply with the Compliance Notice but the respondents maintained that their non-compliance was not deliberate and that they had engaged with the Compliance Notice by seeking a review pursuant to section 84U(1)(a) of the IR Act at the IMC (see [2023 WAIRC 00991]) and then appealing that decision to the Full Bench of the Western Australian Industrial Relations Commission (see [2024 WAIRC 00247]). Ultimately, both of these matters were dismissed and the Compliance Notice was confirmed.
The respondents also sought to engage the ‘reasonable excuse’ provision set out in section 84T(3) of the IR Act and submitted that while the IR Act does not define the term ‘reasonable excuse’, it is intended to be a potential defence for a non-complying employer. The respondents contended they had a reasonable excuse for not complying with the Compliance Notice. In addition to the period of time impacted by the review and appeal matters, during June to August of 2024, the claimant did not respond to the respondents’ requests to confirm electronic funds transfer details and as such, the respondents could not make the payment. The claimant argued that the obligation to comply with the Compliance Notice arose on 6 June 2023 and the respondents' evidence of events since that date could not serve as a reasonable excuse as the reasonable excuse must have existed at that time to be a valid defence.
The Industrial Magistrate found that the respondents were aware of the need to obtain a stay of the Compliance Notice's operation but did not produce any evidence to explain why they had not complied with the Compliance Notice or pursued a stay of its operation following the review decision being delivered on 22 December 2023 and then following the dismissal of the Full Bench appeal on 28 May 2024. The Industrial Magistrate noted that the Compliance Notice clearly stated the bank details for the payment, and the respondents did not provide any evidence of their inability to make the payment to the specified bank account. Further, the respondents did not provide any evidence that ARC Holdings had complied with the second step in the process, that is to provide evidence of the required payment to the Department. The Industrial Magistrate found that the respondents did not establish a reasonable excuse for not complying with the Compliance Notice.
The Industrial Magistrate determined that ARC Holdings' non-compliance was deliberate and that the second respondent was involved in the contravention. As a result, the Industrial Magistrate imposed penalties of $15,000 on ARC Holdings and $3,000 on the second respondent, citing the need for both specific and general deterrence to ensure compliance with industrial laws, to reinforce the significance of adhering to compliance notices and to deter similar conduct by others in the future. The full decision can be read here.