Ombudsman offers alternative to litigation

by Cameron Edmond16 Jan 2014
A Goondiwindi-based café was found have underpaid an employee close to $50,000 over a five-year period, following an investigation by the Fair Work Ombudsman (FWO).
Gunsynd Café paid a worker a flat rate of $900 for work performed between 2007 and 2013, despite the employee working an average of 45-hours per week.

The employee complained, and the FWO found that the rate did not cover the employee’s entitlement to night work allowances, weekend/public holiday penalty rates and applicable overtime.

In addition, the inspection uncovered a failure to issue payslips to the employee, and relevant employment records (rate of remuneration, hours worked, overtime, superannuation contributions) hadn’t been kept.

The café co-operated with the FWO on the investigation, which has resulted in an Enforceable Undertaking as an alternative to litigation.

This Enforceable Undertaking means the organisation must apologise in writing to the now ex-employee and back-pay him in weekly instalments by the end of November 2014. Debra Kaye Ash, the business owner, has expressed regret over her failure to comply with the café’s lawful obligations.

“Gunsynd Café and I express our sincere regret and apologises to you for failing to comply with our lawful obligations,” she wrote in her letter to the ex-employee.
In addition, Gunsynd Café must:
  • Ensure future compliance by implementing systems and processes – including engaging a full-time book-keeper.
  • Ensure training on compliance with workplace laws is provided by an accredited workplace trainer for all persons with managerial responsibilities.
  • Audit its compliance with pay rates for a minimum of 30% of its employees each year for the next three years.
Enforceable Undertakings are viewed by Fair Work Ombudsman Natalie James as one of the methods by which the FWO is encouraging voluntary compliance with Federal workplace laws, and serves as an alternative to litigation.

“Their purpose is to focus the employer on the tasks to be carried out to remedy the alleged contravention and/or prevent a similar contravention in the future,” she explained.
Enforceable Undertakings work to encourage organisations to understand their workplace responsibilities and abide by them, helping to prevent similar mistakes from manifesting in the future.

 “We are serious about our job of building knowledgeable and fairer workplaces and don’t insist there is only one way to achieve compliance - education, positive motivators and deterrents are all important,” she said.

What do you think of Enforceable Undertakings? Are they a good alternative to civil litigation?


  • by Howard Whitton 16/01/2014 5:16:15 PM

    Anything that reasonably avoids the costs, delay, and uncertainty of litigations has to be a good idea. But the worker concerned has to be protected - essentially as a secured creditor - in case the employer declares bankruptcy before finalising the debt owed the employee under the Enforceable Undertaking.

  • by Al 17/01/2014 11:52:08 AM

    Good point Howard

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