Director told employee he'd split salary 'so others can't see how much you get paid'
A director's attempt to hide an executive's $200,000 salary from other staff by splitting payments between two companies has blown up in court, triggering multiple Fair Work violations.
Mohammad Shirmohammadi was hired as operations manager at MMP Industrial on October 31, 2022, with an agreed salary of $200,000 per annum including superannuation. But in early October 2022, director Andrew King proposed an unusual arrangement.
"If you don't mind, I'd like to pay you $100,000 on the books and the rest through another entity," King told Shirmohammadi, according to evidence presented to the Federal Circuit and Family Court. The reason? "So the others can't see how much you get paid. I don't want the controversy."
Shirmohammadi agreed. MMP Industrial paid him roughly $1,923 weekly, while a separate company called Avance Urban Pty Ltd paid him $6,121 monthly. MMP issued payslips for the weekly payments but provided nothing for the monthly transfers from Avance Urban.
The arrangement quickly became messy. The combined payments consistently fell short of what was owed each month. No superannuation contributions were made on the Avance Urban payments. When Shirmohammadi needed payslips for a car loan application, King couldn't provide complete documentation.
On April 14, 2023, Shirmohammadi emailed King asking him to check with his accountant about superannuation for "the other half of my salary" that hadn't been paid since he started. King replied it was "on the WIP list" and he would "get to it shortly."
Three days later, King terminated Shirmohammadi's employment during his six-month probation period. King told him: "I want you to finish up immediately. I've been so unimpressed with your performance and communication style."
Shirmohammadi sued, alleging underpayment, unpaid entitlements, missing payslips, and adverse action for complaining about safety issues, payslips and superannuation.
In a judgment handed down on February 13, 2026, Judge Manousaridis found MMP Industrial breached multiple provisions of the Fair Work Act. The company failed to pay Shirmohammadi in full each month, didn't pay his accrued annual leave of $4,390.84 on termination, failed to provide payslips for the Avance Urban payments, later provided false payslips, and didn't give written notice of termination.
The court also found King personally liable as an accessory to all these contraventions under section 550 of the Fair Work Act, meaning the director faces individual exposure.
Shirmohammadi's adverse action claim, however, failed. Despite the tight timing between his superannuation complaint and his termination, the court accepted King's evidence that the dismissal stemmed from performance concerns that had accumulated over months. These included poor procurement and production management, team conflicts, and failure to attend meetings during King's absence.
The decision shows how creative pay arrangements designed to manage internal equity can create serious legal problems. The split salary structure meant half of Shirmohammadi's remuneration fell outside normal payroll processes, creating gaps in payslips, superannuation contributions and payment accuracy.
The case also confirms that probation periods offer no shelter from Fair Work compliance. Employers must meet all National Employment Standards obligations regardless of probationary status. And it demonstrates that solid, contemporaneous documentation of performance issues can successfully defend against adverse action claims, even when termination follows employee complaints within days.
The matter returns to court on March 13, 2026, for a directions hearing on penalties.
