2025 WAIRC 00785
INDUSTRIAL MAGISTRATES COURT OF WESTERN AUSTRALIA


CITATION
:
2025 WAIRC 00785



CORAM
:
INDUSTRIAL MAGISTRATE R. COSENTINO



HEARD
:
WEDNESDAY, 27 AUGUST 2025



DELIVERED
:
WEDNESDAY, 27 AUGUST 2025



FILE NO.
:
M 9 OF 2025



BETWEEN
:
CONSTRUCTION, FORESTRY AND MARITIME EMPLOYEES UNION


CLAIMANT





AND





QUBE PORTS PTY LTD (ABN: 46 123 021 492)


RESPONDENT

CatchWords : INDUSTRIAL LAW – Assessment of pecuniary penalties for contraventions of Fair Work Act 2009 (Cth) – s 50 – s 323- single contravention of an enterprise agreement –contraventions admitted - failure to pay North West Allowance during single pay period – penalty determined
Legislation : Fair Work Act 2009 (Cth)
Crimes Act 1914 (Cth)
Instrument : Qube Ports Pty Ltd Port of Port Hedland Enterprise Agreement 2020
Case(s) referred
to in reasons: : Fair Work Ombudsman v NSH North Pty Ltd trading as New Shanghai Charlestown [2017] FCA 1301; (2017) 275 IR 148
Commonwealth v Director, Fair Work Building Inspectorate [2015] HCA 46; (2015) 258 CLR 482
Australian Building and Construction Commissioner v Pattinson [2022] HCA 13; (2022) 274 CLR 450
Fair Work Ombudsman v NoBrace Centre Pty Ltd (in liq) (No 2) [2019] FCCA 2970
Fair Work Ombudsman v Grouped Property Services Pty Ltd (No 2) [2017] FCA 557
Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8; (2008) 165 FCR 560
Construction, Forestry and Maritime Employees Union v Qube Ports Pty Ltd [2025] FCA 208
Transport Workers’ Union of Australia v Qantas Airways Limited (Penalty) [2025] FCA 971
Result : Penalty imposed
Representation:
Claimant : Mr K. Sneddon (of counsel)
Respondent : Mr J. McLean (of counsel)



REASONS FOR DECISION
(Given extemporaneously at the conclusion of the hearing, extracted from the transcript of proceedings and edited by her Honour for felicity of expression and to include headings, complete references and citations)

1 I am required to determine the penalty that should be imposed on the respondent, Qube Ports Pty Ltd, for its admitted contraventions of s 50 and s 323 of the Fair Work Act 2009 (Cth) (FWA). Although there are two provisions of the FWA Qube has contravened, both contraventions arise from a single instance of an underpayment to Qube's employee, Leah Costa (the Affected Employee).
2 Under the Qube Ports Pty Ltd Port of Port Hedland Enterprise Agreement 2020, the Affected Employee was entitled to be paid the North West allowance for the pay period 5 August 2024 to 18 August 2024, in the sum of $1,165.22. Qube did not pay her the North West allowance, and its failure constitutes the contraventions of s 50 and s 323 of the FWA.
Relevant facts
3 For the purposes of this penalty hearing, the parties jointly provided a Statement of Agreed Facts dated 16 June 2025.
4 Evidence was given by Joel O'Brien (Mr O’Brien), one of the claimant's organisers, who has had dealings with Qube in that capacity. His evidence was relied on to establish that the claimant had raised issues about the North West allowance with Qube on several occasions. His evidence also went to Qube's asserted lack of contrition.
5 Qube relied on a witness statement of Daniel Ortiz (Mr Ortiz), who is Qube's General Manager of Industrial Relations. His evidence was intended to contextualise the contravening conduct.
6 The following uncontentious facts are taken from the Statement of Agreed Facts, the Originating Claim, the Response, the Amended Response and the witness statements.
(1) Qube is a national system employer.
(2) Qube employed the Affected Employee at relevant times.
(3) The Affected Employee was a national system employee.
(4) The Affected Employee was a member of the claimant.
(5) The claimant is a registered organisation as defined in the FWA.
(6) The Enterprise Agreement is an enterprise agreement made under the FWA. It covered the claimant and applied to Qube and the Affected Employee.
(7) Clause 15.4 of the Enterprise Agreement provides for payment of a North West allowance to employees for all ‘Worked Hours,’ and for each pay period, up to a maximum amount of $23.78 per hour.
(8) Clause 2.1(X) of the Enterprise Agreement defines ‘Worked Hours’ to include any period of paid leave.
(9) On 10 August 2024, the Affected Employee commenced a period of paid parental leave.
(10) On 22 August 2024, the Affected Employee was paid 49 hours of paid parental leave for the pay period 5 August to 18 August 2024.
(11) Qube did not pay the Affected Employee the North West allowance for the 49 hours of paid parental leave that she took in that pay period, resulting in an underpayment of $1,165.22 gross.
(12) On 22 January 2025, these proceedings were commenced.
(13) On 20 February 2025 Qube received the Originating Claim in these proceedings.
(14) On 6 March 2025, Qube paid the Affected Employee the amount of $1,165.22 gross, which is the amount the subject of this claim.
(15) On 20 March 2025, Qube filed a Response in these proceedings, denying the contraventions.
(16) On 29 May 2025, Qube filed an Amended Response, admitting the contraventions.
Mr O’Brien’s evidence about raising the North West allowance with Qube
7 In his witness statements, Mr O'Brien says that between 20 October 2023 and 17 April 2025, he had, on several separate occasions, raised the issue of non-payment or incorrect payment of the North West allowance concerning five separate individual Union members, with three different employees or officers of Qube.
8 Counsel for the claimant properly conceded that Mr O'Brien's evidence did not establish that Qube had contravened an industrial instrument on any of those occasions by failing to pay the North West allowance to any employee. Rather, the claimant says Mr O’Brien’s evidence shows that the payment of the North West allowance was controversial or problematic, and so the evidence is relevant to the circumstances of the particular contravention that these proceedings are concerned with.
9 I have difficulty with this submission. I do not accept that the mere fact that the claimant disputed Qube’s application of the North West allowance on a number of occasions reveals anything of particular relevance to the determination of penalty in this matter.
10 The unchallenged evidence concerning the circumstances of the contraventions the subject of these proceedings is to the effect that they were due to an administrative error and were unintentional. None of Mr O'Brien's evidence related to disputes arising because of administrative errors resulting in non-payment of the North West allowance akin to the circumstances arising in these proceedings.
11 In cross-examination, Mr O'Brien conceded that in each instance where the issue about the North West allowance was raised, Qube had either disputed the employee’s entitlement, and no further action had since been taken by the claimant, or Qube had made a back payment, without admitting a contravention, and the dispute was resolved. Qube says, therefore, that if anything, the evidence demonstrates that specific deterrence is unnecessary. The fact that Qube has made payments, even when it disputed its liability to do so, shows Qube does not have a culture or goal of avoiding its industrial obligations or short-changing employees. I accept that is ultimately all Mr O’Brien’s evidence amounts to.
12 Mr O'Brien also says that from his conversations with the Affected Employee, he is aware that Qube has not given her an apology or an explanation. His evidence does not deal with when his conversations took place or the substance of those conversations. The evidence was not objected to, but it was purportedly substantiated by an auto-generated or pro-forma payroll advice which set out the date and amount of the payment, without any apology.
13 To the extent that Mr O’Brien’s evidence is relied on to demonstrate a lack of contrition, I do not give it much weight.
Relevant statutory provisions and principles
14 The FWA provides that the Industrial Magistrates Court (IMC) may order a person to pay an appropriate pecuniary penalty if the IMC is satisfied that the person has contravened a civil remedy provision s 546(1) of the FWA.
.
15 The maximum penalty for each contravention by a natural person, expressed as a number of penalty units, is set out in the table in s 539(2) of the FWA s 546(2) of the FWA.
.
16 If the contravener is a body corporate, the maximum penalty is five times the maximum number of penalty units prescribed for a natural person s 546(2) of the FWA.
.
17 The rate of a penalty unit is set by s 4AA of the Crimes Act 1914 (Cth) s 12 of the FWA.
. The relevant rate is that applicable at the date of the contravening conduct.
18 The contravention occurred on 22 August 2024 when a penalty unit was $313. The maximum penalty in respect of each contravention by an individual is 60 penalty units and so the maximum in respect of a corporation is $93,900.
19 The way the Court is to approach penalty has been helpfully summarised in the parties’ written submissions filed in advance of this penalty hearing and is not in dispute.
20 Borrowing from the decision in Fair Work Ombudsman v NSH North Pty Ltd trading as New Shanghai Charlestown [2017] FCA 1301; (2017) 275 IR 148 at [36], as to the steps involved, I must:
(1) First, identify the separate contraventions, with each breach of each obligation being a separate contravention. Here there is one contravention of the Enterprise Agreement, and accordingly, one contravention of s 50 and a secondary contravention of s 323.
(2) Second, consider the application of s 557 of the FWA. Because I am dealing with a single contravention of the Enterprise Agreement, s 557 does not apply.
(3) Third, consider the appropriate penalty in respect of each individual group contravention, taken in isolation.
(4) Finally, consider the overall penalties arrived at, and apply the totality principle, to ensure that the penalties for each separate contravention when combined are appropriate and proportionate to the conduct viewed as a whole, making such adjustments as are necessary.
21 The purpose of a civil penalty is primarily, if not wholly, that of promoting the public interest in compliance with the laws that have been contravened. The focus of a civil penalty determination will therefore be upon issues of specific and general deterrence Commonwealth v Director, Fair Work Building Inspectorate [2015] HCA 46; (2015) 258 CLR 482 at [55], citing Trade Practices Commission v CSR Ltd [1990] FCA 521 at [40]: see also Australian Building and Construction Commissioner v Pattinson [2022] HCA 13; (2022) 274 CLR 450 (Pattinson), Fair Work Ombudsman v NoBrace Centre Pty Ltd (in liq) (No 2) [2019] FCCA 2970 at [66] and Katzmann J in Fair Work Ombudsman v Grouped Property Services Pty Ltd (No 2) [2017] FCA 557 at [388].
. However, ‘insistence upon the deterrent quality of a penalty should be balanced by insistence that it “not be so high as to be oppressive”’ Pattinson at [40] citing NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission [1996] FCA 1134; 71 FCR 285.
.
22 The maximum penalty is a relevant consideration but “does not constrain the exercise of discretion … beyond requiring “some reasonable relationship between the theoretical maximum and the final penalty imposed” Pattinson at [10], citing Australian Competition and Consumer Commission v Reckitt Benckiser (Australia) Pty Ltd (2016) 340 ALR 25 at [156].
. The “reasonable relationship” should be considered by reference to the need for deterrence Pattinson at [55].
.
23 The parties submissions each set out the commonly referred to ‘non‑exhaustive range of considerations’ to which regard may be had in determining whether particular conduct calls for the imposition of a penalty, and if it does, the amount of the penalty.
24 The range of considerations is not ‘a rigid catalogue of matters for attention.’ At the end of the day the task of the Court is to fix a penalty which pays appropriate regard to the circumstances in which the contraventions have occurred and the need to sustain public confidence in the statutory regime which imposes the obligations.’ Buchanan J in Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8; (2008) 165 FCR 560 at [91]

25 Although the range of considerations provides useful guidance, the task of assessing the appropriate penalty is not an exact science Commonwealth v Director, Fair Work Building Inspectorate [2015] HCA 46; (2015) 258 CLR 482 at [47].
. The Court must ultimately fix a penalty that pays appropriate regard to the contraventions that have occurred Pattinson at [19].
. ‘[A] court empowered by s 546 to impose an “appropriate” penalty must act fairly and reasonably for the purpose of protecting the public interest by deterring future contraventions of the Act.’ Pattinson at [48].

The nature and extent of the conduct which led to the contraventions
26 The breach relates to one employee, one payment, and one payroll period. The underpayment was to the extent of $1,165.22. While this might be characterised as a relatively anodyne or minor amount, this is not, on its own, indicative of the appropriate penalty relative to the maximum. The maximum is not reserved for the objectively gravest contravention in terms of quantum.
27 What is relevant is that the breach was a one-off anomaly. The Affected Employee was paid the North West allowance while on parental leave except for this single payroll period. This is strongly indicative of the lack of a need for specific deterrence, because there was no inclination towards further contraventions.
The circumstances in which the conduct took place
28 According to Mr Ortiz, he made enquiries of Qube’s payroll team in order to understand how the underpayment occurred. He explained that Qube’s payroll system (Chris21) was separate to the rostering and time attendance system (Microster). For the payroll team to process payment of the North West allowance, the payroll team would conduct a manual review each fortnight to determine an employee’s eligibility for, and the amount of, the North West allowance. That manual process involved review of the time and attendance records to determine the employee’s ‘Worked Hours.’
29 The system was such that paid parental leave had to be manually entered and processed through Microster, before it would flow through to the payroll system.
30 The reason why the Affected Employee did not receive the North West Allowance in the first week of her parental leave was because the parental leave was entered into Microster after the payroll team had undertaken the manual processing of the North West Allowance for that pay period.
31 Accordingly, the error was completely inadvertent and was the product of a previously uncontemplated shortcoming in the system.
32 This evidence was unchallenged.
33 The circumstances here involve genuine and unintended error in the manual steps involved in payroll processing, as described by Mr Ortiz. The payroll processing system had a shortcoming, which would not have manifested, except that the payment straddled a period of hours actually worked and a period of paid leave, combined with the timing of the manual assessment of the North West allowance entitlement and the timing of the entry of leave into the rostering system.
The nature and extent of any loss or damage sustained
34 The loss is limited to the delay of several months in the payment to the Affected Employee of the after-tax amount, which was due in August 2024.
Whether there has been similar previous conduct by Qube
35 There is no evidence before me of similar previous conduct by Qube. The highest the evidence goes is that the NorthWest allowance had been controversial, or the subject of dispute. This is not an aggravating factor.
The size of the business enterprise involved
36 Mr Ortiz’s evidence was that Qube employs over 2,200 employees and over 8,400 people across the broader corporate group. Part of Mr Ortiz's role is to oversee compliance with the multiplicity of industrial instruments that apply to Qube. Qube, in its written submissions, submitted that the complex industrial environment and scale of operations do not mean that non-compliance is excusable, but that inadvertent, and one-off underpayments are at least understandable.
37 His Honour Justice Feutrill rejected a similar argument, although in a slightly different context, in Construction, Forestry and Maritime Employees Union v Qube Ports Pty Ltd [2025] FCA 208 at [94], observing that a calculus based on the number of previous contraventions, compared against the number of employees and locations, does not offer a compelling reason to reduce the weight that would otherwise be afforded to previous contraventions. His Honour said the size and spread of an employer's operation is not a reason for diminishing corporate responsibility for contraventions that may be indicative of systemic or underlying failings in corporate systems, policies, procedures and culture. With respect, I agree with his Honour’s reasoning.
38 The claimant submitted that Qube's size was such that a substantial penalty was required to provide a deterrent effect. It submitted, in its written submissions, that anything less than the maximum will go unnoticed. In oral submissions, Counsel relied on Justice Lee's observations in Transport Workers’ Union of Australia v Qantas Airways Limited (Penalty) [2025] FCA 971 at [26]-[28] as to the core role of penalties in promoting compliance with industrial instruments and the FWA.
39 Qube's size is a relevant factor and is indicative of the need for a substantial penalty. But I reject the submission that ‘anything less than the maximum will go unnoticed’.
Whether or not the breaches were deliberate
40 The contraventions occurred due to a shortcoming in Qube's payroll processing system, which required a manual assessment of an employee's ‘Worked Hours’ per pay cycle for eligibility for the North West allowance. The system failed because, for the particular pay cycle, the Affected Employee's paid leave was entered into the rostering system after the ‘Worked Hours’ were manually extracted from the rostering system and entered into the payroll system, so that the leave was not calculated as ‘Worked Hours.’
41 It is clear that the contraventions were not deliberate. Had they been deliberate, the non-payment would have continued beyond the relevant pay period. It is appropriate to treat this contravention as the result of inadvertence and human error. This is a telling factor when it comes to assessing the need for specific deterrence.
Involvement of senior management
42 There is no evidence that senior management was involved in or contributed to the occurrence of the contraventions. Senior management became involved to rectify the contraventions, understand how they occurred, and to put in place steps to minimise the risk of future contraventions.
Whether Qube has shown contrition
43 Mr Ortiz stated in his evidence that Qube regrets the inconvenience and stress the matter may have caused to the Affected Employee. The claimant submits that it is questionable whether Qube has shown remorse and suggested that Mr Ortiz's evidence amounted to mere lip service.
44 Mr Ortiz was not cross-examined on this issue but the claimant says the lack of contrition is demonstrated:
(a) by the fact that Qube originally denied the contravention; and
(b) because Qube’s evidence about the Enterprise Agreement’s Dispute Resolution Procedure and the lack of its utilisation to resolve this matter implicitly amounts to a criticism of the claimant for instituting these proceedings.
45 It is clear from Mr Ortiz's unchallenged evidence that Qube was unaware of the contravention until these proceedings were commenced. It is also clear that Qube acted very promptly as soon as it became aware of these proceedings. It investigated, accepted that there was an underpayment, and remedied it by making a payment without any undue delay. It has invested in improvements to its payroll processing systems. It has cooperated in ensuring that these proceedings could be progressed efficiently and without delay. These are contrite actions.
46 Qube initially denied there was a contravention in these proceedings. That position was:
(a) contained in a Response which also admitted that the Affected Employee was entitled to be paid but was not paid due to an administrative error;
(b) informed by the erroneous view that, having remedied the underpayment, there was a defence to the claim Exhibit 4 - Witness Statement of Daniel Raul Ortiz dated 23 July 2025.
; and
(c) changed by the Amended Response, which admitted the contraventions relatively early in the proceedings. The only substantive steps that had been taken to that point was the conduct of a pre-trial conference and the filing of consent to orders dealing with the Amended Response.
47 Mr Ortiz’s unchallenged evidence was that since late 2024, Qube has taken steps to implement automated payment processes for payment of the North West Allowance, to reduce reliance on manual assessments. The integration of the North West Allowance into Microster went live from 1 July 2025.
48 Mr Ortiz's statement of regret is consistent with the actions that Qube has taken since the underpayment was brought to its attention, including its review and improvement of payroll processing systems.
49 Mr Ortiz’s evidence refers to and summarises the dispute resolution procedure contained in the Enterprise Agreement, and he says that it is Qube's expectation that payroll issues be resolved through the dispute resolution process, unless it is uncontroversial Exhibit 4 at [10] to [11].
. I understand that this particular underpayment is an uncontroversial one. In that case, according to Mr Ortiz, he would expect it to be resolved between an employee and their manager, without there even being recourse to the dispute resolution procedure.
50 At paragraph 16, Mr Ortiz says that the underpayment was not brought to Qube's attention, much less was there any attempt by the Affected Employee or the claimant to progress the matter under the dispute resolution procedure. Nothing is said in the claimant's written submissions in reliance upon the absence of utilisation of the dispute resolution procedure. And nothing was said that was critical of the non-utilisation of the dispute resolution procedure in submissions during the hearing.
51 Qube has not expressly criticised the claimant, for either commencing the proceedings, or for not bringing the matter to the attention of Qube via the dispute resolution procedure.
52 Put in context, Mr Ortiz’s reference to the dispute resolution procedure and Qube’s expectations about how such matters might be dealt with and resolved, appears to be for the purpose of demonstrating Qube's lack of prior knowledge of the underpayment. Accordingly, I do not consider that the evidence undermines the contrition that Qube has shown. Qube's corrective actions, cooperation and contrition are therefore mitigating factors.
Corrective action
53 Corrective action was taken in the form of payment of the underpaid amount to the Affected Employee, as well as, from 1 July 2025, integrating the North West allowance into the Microster rostering system.
The need for specific and general deterrence
54 Qube relied on evidence of its contributions to the communities in which it operates as evidence that it strives to be a respected and good corporate citizen. It says that it is not an employer that is attempting to exploit or otherwise deprive employees of their legal entitlements. This position is also, on Qube's submissions, supported by the evidence that matters raised by Mr O'Brien in his evidence were resolved, most frequently, by Qube making relatively prompt payments of the North West allowance, where it was alleged that it was due.
55 The claimant, on the other hand, points to Qube's history of contraventions and penalty proceedings in this Court. From 2022, there are seven instances of Qube being found to have contravened section 50 of the FWA, and seven occasions when a pecuniary penalty has been imposed. I was also told that there are four further proceedings currently on foot, in which there has been admitted contraventions, but where penalties have not yet been imposed.
56 The fact that Qube does not have a clean compliance record deprives it of reliance on its record as a mitigating factor. There is a not insignificant number of contraventions over the period since about 2022. This is indicative of the need for specific deterrence.
57 There is, of course, also a need for general deterrence.
Conclusion on penalties
58 Balancing all of these considerations I consider a penalty of 12% of the maximum penalty is appropriate in respect of the contravention of section 50. Because the contravention of section 323 is an incidental consequence of the contravention of section 50, I do not propose to impose a separate penalty in respect of that contravention.
59 The total penalty for both breaches will be $11,268, which I consider serves the purpose of both specific and general deterrence, having regard to the size of Qube's operations and its prior history of contraventions.
60 The penalty ought to be paid to the claimant, consistent with the standard practice and the principles as set out in Milardovic v Vemco Services Pty Ltd (No 2) [2016] FCA 244; 242 FCR 492.



R. COSENTINO
INDUSTRIAL MAGISTRATE