CATCHWORDS INDUSTRIAL LAW - BREACH OF AN AWARD - UNDERPAYMENT OF WAGES - BREACHES ARISING OUT OF A COURSE OF CONDUCT - BREACHES TO BE TREATED AS CONSTITUTING A SINGLE BREACH - POWER OF COURT TO ORDER PAYMENT WHEN NO PENALTY CAN BE IMPOSED - CONCILIATION AND ARBITRATION ACT 1904 s. 119 (1) (14), (1B), (1C) (3). John Richard Quinn v. Barry Martin W.A. Nos 1-6 of 1977 Coram: Smithers, Evatt, Keely, JJ. Perth 16th September 1977. If THD FEDERAL COURT OF sUSTRALTA WESTeRi LUSTRALTAT DICTRICT RuGIsTay Woh. Nos. 1 - 6 of 1977 i TsWUSTRIAL DIVISION In the matter of - Tis COMCILIATION AMD ARBITRATION ACT 1904 Between - JCUIN RICHARD QUINN Clainent - and - BARRY MARTI Respondent {MDs5ns OF SiTTHms, J. iy BEY CE s BYATT, Jo KEULY, J. DATE: 16th September, 1977 PLACE: PaRS! ORDERS OF TEE COURT: The Court orders that - 1. The Respondent, Barry Martin, pay to Lester Herbert liayes the sum of U3.314671. 2. The Respondent, Barry Martin, pey to John Stuart Shepherd the sum of $1,804.94. — IN THE FEDERAL COURT OF AUSTRALL: ») WESTERN AUSTRiLIAN DISTRICT REGISTRY W.A. Nos. 1 - 6 of 1977 INDUSTRIAL DIVISION In the matter of —- THE CONCILIATION AUD ARBITRATION ACT 190. Between ~ JOHN RICHARD QUIN Clazmant - and - BARRY IARTIU Respondent 16th September, 1977 SNITHRS, LVATT, and KESLY, JJ. REASONS FOR JUDGiNT In six summonses (Nos. WA. 1, 2, 3, 4, 5 ond 6 of 1977) the claamant, Jonn Richard Quinn, an inspector appcinted pursuant to S.125 of the Conerliaticn and arbitration Act 1904 (the fict) seeks orders under $.119 imposing penrlties upon Barry Martin, the respondent, for breaches of c1.26 (Wages), cl.28 (Overtime) and cl.29 (Special Allowances) of the Professional Divers! Avavd 1974 (the Averd) in respect of roneys due to tivo employees of the respondent, namely, Lester Herbert Mayes end Jchn Stuart Shepherd for various periods set out in the respective summonses. The Court was asked to make further orders pursuant to $.119(3)} that the respondent pay to such employees amewits of pactacvlarised wnderpayments to which they were entitled under the Avacd, lotelling, in respect of lir.Nayes, 35,314.71 end in respect of Iir. Shepherd, $1,804.94. Clause 26 Lf the Avard came into eperation as from the first pay period on and after 1 Februery,1974. Clauses 28 and 29 of the Averd operated as from the first pay period on and after 26 Pebruary,1974. Pursuant to S.61 of the Act the respondent was thereafter bound by the Averd and variations thereto, and the said tvo emplayees vere entitled to the benefzts pravided for therein durin, the period of their ejioloyment with the respondent, 2. The three summonses before the Court conecrning the employment by the respondent of lure Mayes allege 1m regard to cl. 26 of the Avard that the respondent failed to pay him the Award rates fcr the pay week ending 7 Pebruery, 1974; ain regard to cl. 28 of the Avard, that he failed to pay him overtime at the rate provided for during 45 pay weeks between February, 1974, and 16 January, 1975; and in regard to cl. 29 of the Award, that he farled to wy him the Special Allovanc-s provided for in respect of 94 days on and between 1 Murch, 1974, and 4 January, 1975. The three summonses before the Court concerning the employment by the respondent of Hr.Shepherd allege in regard ts cl. 26 that the respondent failed to pay hin the 4vard rates in respect of 3 pay week~ ending 20 June, 1974, and 6 ané 13 February, 1975; in regard to cl. 28 of the uword, that he failed t psy him overtime at the rates provided for during AT pay weeks between February, 1974, and 15 February, 1975; and in regard to cl. 29 of the Avera, that he failed to pay him the Special Allovanecs provided for in respect of 45 days on and between 20 Iiarch,1974, and 6 February ,1975. as stated, the amounts of the elleged undervayments in respect of Ix. Imyes totalled 35,214.71, and in yrespecl of iir. Shepherd totalled 21,804.94. It .as conceded by counsel for the respondent that the breaches alleged had been committed by the respondent and thst the employees 1n question hed been underpaid accordingly. However the respondent contended that by reason of tle provisions of 5.119 (1) these proceedings were incompetent. 3e The relevant parts of $.119 are as Follous :- 119. (1) "here any organization or persen bound by an order or avard has committed a breach or non-observance of a term of the order or avard, a penalty may be imposed by the Court or, except in the case of a breach or non-observance of a term of an order or avard of the kind referred to in sub-section (1) of section 33, by any District, County or Local Court or Court of summary jurisdicti n that is constituted by a Judge, by a Police, Stipendiary or Sp2cial Macistrate or by an Industrial Maz;istrate appointed under any State sect who 1s also a Police, Stapenciary oer Svccial liagistrate. (1A) Subject to the next two succeeding sub-secticns, where a Court finds that two or more breaches by the same organizatisn or gercon of a term of an order or award have been committed and those breaches appear to that Court to have arisen out of a course of conduct by that organization or person, those breaches slall, for the vurpo:es of this suction, be treated as constituting a cingle breach of that tern. (1B) 4 breach by an organization or p:rsen of a term of an order or avari conmitted after a Court has imposed a penalty in respect of an earlicr breach by that organization or persen of that term shall not be taken to have arisen out of the same cevrse of conduct as tne earlier breach. (3) Where, inary proceedings ajainst au employ r befere 2 Court specified in wub-sectinn (1), it apperrs to the Court that an employes of lhet evpicyer has not been paid an a.ount to which he 1s entitled under ac order or avard, that Court may order that the employer shall pay to tne empleyee the amcunt of the underpayment but no order shell be made in respect of so much of the underpayment as relates to any period Y more than six yecrs price to the ccimencement of the proceedings. 4. Six summonses (numbered B 367, 368, 369, 370, 371 and 372 of 1975) vere assucd under the Act in 1975 against the respondent, claimine penalties pursuant to $.119 for alleged breaches of the Avard in respect of the same clauses thereof as are mentioned above end relating to underpayments thereunder in respect of the same two employees. Those summons:s vere heard by the Australien Industrial Court on 20 znd 21 August, 1975. The cleimant in these proceedings vas Terence Anthony Lemmon, an inspector appointed pursuant to $.125 of the Act. Summonses B 367, 368 and 369 of 1975 related tc alleged breaches by the respondent cf clauses 26, 28 and 29 of the ward respectively in respect of the employee Mr. Shepherd committed between 7 February, 1974 and 26 December, 1974. The affidavit of the claimant filed in support of the sum- monses shoved that he had been underpaid by reason of such breaches amounts totalling $423.21. Surmenses B 370, 371 and 372 of 1975 related to alleged breaches by the respectively respondent of clauses 26, 28 and 29 of the Auard /in respect of the eaplcyee li. lLayes committed between 14 May, 1974 and 3 April, 1975. The affid.vit vf the claiarant filed in support of the summonses sho'ed that he had been underpaid by reas:n of such breaches amounts totalling "681.78. On 21 august, 1975, the Australian Industrial Court found that the breaches referred to 1n each of the three summonses in respect of the employment by the respondent af Mr.Shepherd had been comritted and arose out of a course ef conduct by the respondent within the meaning of $.119 (14) and treated the breaches of each particular clause of the Avard «s consttutiug a single breach of each respective clause, and impssed the followang venalties :- 5a In matter B 367 of 1975, a penalty of "3503 an matter B368 of 1975, 4 penalty of %150; acd an matter B 369 uf 1975, a penalty of 3100. That Court further found that the conrse of conduct by the respondent referred to alse applied to those breaches in respect of the employment by the respondent of Mr. Mayes and imposed no penalty in respect cf these breaches referred to in ratters B 370, 371 and 372 of 1975. Further, the Australian Industrial Court made orders pursuant te Section 119 (3) that the respondent pay tc the iwo cmplcyees the amounts of underpayments alleged, namely, *423.21 in the care of lir.Ghephcrd 7nd 1686.78 in the case of liv. luayes. There was pra.ented to the Court what was called au "agreed stalenent" S12 ued by cuunsel in the follewing terms : 1. Breevhes of Avard as claimed and anovnts are correct. 26 That acticns in 1975 were pert of tot-l breaches of aware and these actions are the balance. 3. Al evidence available in 1975. This statement ves 1aterpreted by the parties and the Couct as meaning, first, that the breaches of the Award alleged in each ef the summonses presently before the Court had been commiilcd as alleged and that the undecpayments set cut in the affidavits of the clcsmant filed ian xespect of such summonses had wceurred as alleged. Sccondly, that the breaches dealt vith by the 4ustralizn Industrial Court pursuant to the summonses heard by it in August, 1975, were part cf a total nurber of breaches rf the Avard committed by the respcadent in relation to the tvo employees mentroned above and the breaches outlined in the summonses pre.ertly before the Couet vere the balance of such breaches. Thirdly, that the evidence relating to all breaches of the £verd by the resp-ndent in resvect of the said tue employees Vas svallable to the claimant 1n Wie summenses heard by the Australien Industrial Court 1n August, 1975. -~ wu 6. The respondent and the tvo employees in quection gave oral evidence in the present zoveedings, On the evidence and admissions before the Couct we find that each breach alleged in the proceedings before this Court in respect of cl.26 of the Avord (matters Ifo. ".A. 1 of 1977 and WA. 4 of 1977) breach cccurred, that each such, arose out of 2 course of conduct by the responcent ad that the breaches of cl. 26 of the Avard which led to the imposition of a penalty under $.119 of the Act by the Australian Industrial Court on 21 August, 1975, arose out of the saiie course of conducl, The course of conduct was that the respondent having decided that he would vay to the employees not amounts of money in accordance vith the Avard but such anuounts, having some relation to the provisicas of the award, but not exceeding whal the resvondent concidered he could afford in prevailing conditions, intimated to the ewployces in question the awounts he was willing | to pay and anformed them that unless they accepted such atounts their employnent \rould be terminated and upon their agreement to accept svch amuunts the respondent paid the some for the work done by the employees. Relying upon §.119 (1A) lir. Jackson , who apreared for the respondent, of c1.26 of the Avard argued that all of the breaches /(v12., those already dealt with by the iustralien Industrial Court anc Viose presently before this Gourt) "shall, for the purpos-:s of this Section, be treated es constituting a single breach of" cl, 26 of the Award. <Accordingly,it was argued that this Court has no power to impose a penalty in respect of the breaches of cl. 26 of cl, 26 presently before it. Indeed Mr. Jaclison contended that the breeches /rlleged of cl. 26 in the summonses before this Court had werged in the breach/Cealt with by the Austrs lian industrial Court and could sot now be the subject of any picceedings under 5.119 (1) or the foundation for aay relief under 5.119 (3). The sane orgument was advatced by Im. Jackson in respect of the allezed breaches of clauses 28 and 29 of the Aver respectively, in natters Nos. W.A.2 end 5 (cl. 28) and matters Nos. Wt. 3 end 6 (cl. 29). Te On the evidence and admissions we find that the alleged breaches of cl. 23 of the Avard occurred, that they arose out of a course of conduct by the respondent,end that the breaches of cl.28 which led to the impositi-n of penalties under $.119 of the Act by the Avstralian Industrial Court on 21 August 1975, arose out of the same course of conduct. "le nalze the same finding in respect of the alleged breaches of cl. 29. «ccordingly, as to the questions of lav our decision in relation to the breaches of clauses 28 and 29 w111 be tice same as our decision in vespect of the breaches of cl. 26. ; Mr. Sharp Q.C., who appeared with Nr. P.R, Kirby for the claimant, argued that, upon the prorer interpretation of S.119 (14), the breaches taerein referred to do not iaclude breaches other than those which are before the Court in the particular proceedings in which it 1s sought to rely upon that sub-section. Accordingly he said that this Court cannot consider any breaches other than those alleged by the claimant in the proceedings before it end more specifically, that breaches already dealt with an lhe decision of the Australian Industrial Court on 21 August, 1975, are irrelevent. Ve do not accept this argument for two reasons. First, in our view the antention of the Legirlature in inserting sub-section (14 into 5.119 an the amending sct 2n 1970 w.s to easure that, subject to certaia exceptions under sub-sections 119 (1B) and (1C) nol presently material, only one penalty could be 1mposed in respect of any number of breaches by the one respondent of a term of an Avard where tho e breaches arose "out of a course of conéuct by" that respoudent. ' If the argument of lir.Sharp were correct, that lLgislative intention could be frustrated by a claimant or separate clairants seeking and obtaining separate summons:s 1n respect of each alleged breach of a particular term of an averd. 8. Secondly, 2f the avgurent of Ir. Sharp vere correct, then 8.119 (1B) would have been quzte unnecessary. In our view in acopting the material 1970 ancnéments vnich include sub-sectzons 119 (14) and (1B) the legislature clearly contemplated that but for the express terms of 5.119 (1B) breaches of a term of an award by a respondent occurring after the imposition of a penalty 2n respect of earlier breaches of that term of the avard end arising ' out of the same course of conduct ac thst out of which the earlier breaches arose together with those earlier breaches vould pursuant to sub-section 119 (14) all be required to be treated us 2 single breach. In other vords, the dividing line between breaches which are the subject of sub-section 119 (14) and cre to be treated as a single breach anc those which ere not, is the fact ané date of the imposition of a penalty in resvect of a breach of the relevant avard term. Those breaches committed before such penalty 1s urposed ere to be treated as a single breach. In our view the vords used 1n 5.119 (1a) are wide and cequire tlis Court tc consider any evidence before 1¢ a. tc the course of conduct of the respondent includin, evidence that breeches of the term of the Avard alrecdy cealt with by a Court arose out of the seme course of conduct es taat alleged 1n respect of the breacnes now before this Court. ' Accordin ly in view of the fandangs of this Court the breaches alleged in these proceedings and those the subject of the proceedings before the Australzan Industrial Court must for the purpos.s of 5.119 "be treated" as a Single breach. The questicn 1s, what is the effect of co doing. It 1s clear thst an respect of thet single breach a penalty has already been umposed by a conpotent Court . accordingly no further penalty should o1 could be imposed by thas Court. The reraining question is whether sub-section 119 (3) empovers the Court to make an order for payment to the employees of the underpayments resvlting from the breaches which together with those dealt with by the Australian Industrial Court arc to be treated as a single breach. - Mr.Jeckson argued lhal the pover conferred by sub~section 119 (3) upon the Court to order an caployer to pay to an employee the amount of an underpayment, ' only exists where in the proceedings before the Court in which the order is sought, a penalty maght be imposed. He submitted that the Court had no such power vhere it is unable to impose a penalty. Ve do not accept this ergunent for the following reasons. sub-section 419 (3) does not expressly state that the power there conferred is so limited. On the conilary, 11 confors the nower in clear terms by providing "Where, 1n any proceedings against an employer before a Court specified in sub-section (1) it appears to the Court that an employee ... hes not been paid ... ™. In these proceedings 1t does so appear ond inevitably in pursuing the benefits of sub-section 119 (14) the respondent made it appear that such underpayments had been made. Assuming that for the claimant to succeed on this issue, the proceedings must have been brought under sub-sectzon 119 (1), these proceedings have been so brought in respect of breaches of the Awacd. Ss. 119 (1A) requires that the breaches with 911 other breaches arising out of the sane course of conduct "be treated as constituting 3 single breach". the /seetion does not provide that the breaches to which 1t refers shell be "deexed" to be one breach,nor does 1t say that the breaches such as are proved in this Court to have occurred ave to be regerded as never having occurred. 10. That the breaches proved in this case arc, together with the breaches proved before the sustralian Industrial Court, iv be treated as a single breach is pertaaent to the imposition of a penalty vursuant to ss. 119 (1) and 119 (1D). But the jurisdiction conferred by ss. 119 (3) docs not appear to us to be conferred as an incident to the impositicn of a penelty. It is conditione] enly on its prop:rly appearing to a Court in a proceeding pursuant to ss. 119 (1) ox possibly 1m sore other proceeding that underpayments heve occurred in breach +f an avaru., In the 1ntecpretalion of sub-secti-ns 119 (14) and (1B) en intentacn is discernible to protect a respondent from laultiple penalties 1n respect cf breaches crising out ¢f @ particular course of conduct. This can be seen as a provision to avoid excessive sancticns. a procedure for But such an intenticn has nothing to do withseasuring that moneys due to cmployees pursuant to an award are actually paid. % would in our view require clear words to disclose an intentizon to make the exercise of the gurisdiction,designed to that end as conferred by ss. 119 (3), subject to a cndition that 1t could only be cxercised 1f a penalty could be imposed in the relevant proceedings under s.119 nolinthstanding that the relevant breaches had been proved. Accordingly the finding of lhe Court 1s that the breaches alleged by the claimant ain these proceedings were committed by the re.pondent cnd that those breaches together with the breeches the subject of the nroceedings ezainst the re-pondent in the Australian Infustrial Court on 21 August,1975, all aruse out vf the save course ef conduct by the xrcspondent. The finding of the Court also is that the nnderpayments alleged by the claimant in payrnents due to the employees Lester Herbert ilayes and John Stuart Shepherd occurred as alleged. rrr ee " * 11. The order of the Court is that the respondent pay to Lester Herbert layes the sum of %5,314.71,end to Jom Stuart Shepherd the sum of "1,804.94.