REASONS FOR JUDGMENT
1 This proceeding was commenced in June this year on the filing of an application and accompanying statement of claim by the applicant, the Fair Work Ombudsman. Per force of s 701 of the Fair Work Act 2009 (Cth) (Fair Work Act), the applicant was at that time a Fair Work Inspector for the purposes of that legislation. The first respondent, Australian Shooting Academy Pty Ltd (Australian Shooting Academy), is a corporation which operates an indoor shooting range business on the Gold Coast in Queensland. It has done so since 1994. That shooting range is open to members of the public.
2 At that facility it is possible for persons who do not hold individual licences under governing State weapons legislation to engage in range practice using firearms for recreational purposes. Australian Shooting Academy holds a separate licence under State weapons legislation which allows this type of facility and activity lawfully to be conducted. Mr Michael Joseph Murphy (Mr Murphy), the second respondent, has at all times material to the proceeding been the managing director of the Australian Shooting Academy. He has also held the office of company secretary and has a 50% shareholding in that company.
3 In those various capacities, but particularly that of managing director, he has had responsibility, and continues to have responsibility, for the overall direction, supervision and management of the Australian Shooting Academy's operations, including the terms and conditions of employment of the company's employees.
4 As a result of changes made by the Parliament to the laws governing industrial relations in this country in respect of, materially, constitutional corporations, the Australian Shooting Academy came to be subject on and from 1 July 2009 to Pt 3-1 of the Fair Work Act. Similarly, on and from 1 January 2010 it became bound by the National Employment Standards which are found in Pt 2-2 of that Act. Also on and from that date it became covered by the Amusement, Events and Recreation Award 2010 which is a species of "modern award" with respect to the employment of its employees.
5 In or about late February 2010 the Australian Shooting Academy sought to enter into what are known as Individual Flexibility Arrangements with certain of its employees. In his capacity as managing director, Mr Murphy was knowingly concerned in that corporate endeavour. Seven employees, including a Mr Jonathan Baxter, signed what at least purported to be individual flexibility arrangements.
6 Another employee of the Australian Shooting Academy, a Mr Kenneth Swanson, declined to sign such an arrangement. As a consequence of statements made and conduct engaged in by the Australian Shooting Academy, in which Mr Murphy was knowingly concerned in relation to the offering of those arrangements to those employees, the Fair Work Ombudsman alleged that a number of contraventions of the Fair Work Act had occurred.
7 The Australian Shooting Academy and Mr Murphy have admitted that contraventions of the Fair Work Act occurred. I am satisfied that each of them has done so at the earliest practical opportunity.
8 Thus, whilst the case was originally, and perhaps out of an abundance of caution, listed for trial, there has been a timely acknowledgement of liability on the part of each respondent with a consequential saving to the Executive Government of the cost of the prosecution of the civil penalty proceeding, a saving in terms of disruption of the lives of those whom one might apprehend would necessarily have had to give evidence for the Fair Work Ombudsman in the proceeding, and also a saving in terms of publically provided judicial resources. All of these are factors to take into account in relation to the imposition of penalty. They are mitigating factors.
9 Behind the somewhat terse summary which I have thus far offered of the occasion for the bringing of proceedings, lies a detailed course of events in respect of dealings as between the Australian Shooting Academy, via Mr Murphy, with its employees. Those details have become the subject of an agreed statement of facts which was tendered jointly on the penalty hearing. The agreed statement travels beyond just matters of fact, but also embraces to an extent agreement as to some mixed questions of fact and law. Insofar as it agrees matters of fact, I act on the evidentiary foundation thus disclosed. Insofar as there are mixed questions of fact and law in the agreed statement, I am satisfied that there is no error of principle in relation to the legal questions which intrude in those mixed questions. That statement of agreed facts is incorporated in a schedule to these reasons for judgment. By this means the detail in respect of the conduct will be revealed without unnecessarily intruding upon the consideration of the questions of penalty.
10 The parties have also lodged with the Court, and adopted in the course of oral submissions, joint submissions on penalty. They are, with respect, to be commended for so doing. I have had the benefit of considering those joint submissions. I agree with the substance of them. I shall make some general observations concerning them and also highlight particular aspects of those submissions.
11 One feature in relation to penalty of those joint submissions is that they underscore the degree of cooperation in the administration of justice on the part of the Australian Shooting Academy and Mr Murphy. I particularly take that into account also as a mitigating factor on the subject of penalty.
12 Another matter which emerged in the course of oral submissions this morning which is a mitigating factor is that Mr Murphy proposes to cause the Australian Shooting Academy to send, via the Fair Work Ombudsman, to each of the employees concerned a letter of apology. That is no small thing in the conduct of industrial relations. It can, I am quite sure, not only evidence contrition on the part of the Australian Shooting Academy and Mr Murphy, but also have what one might term a healing effect in respect of individual grievances on the part of particular employees. The respondents are to be commended for taking this course. It is conduct to be encouraged in relation to the conduct of industrial relations in this country, in my opinion.
13 In other words, even though one might hope and expect that contraventions of the Fair Work Act do not occur, if when, on reflection, an employer realises that it has contravened the legislation, it takes steps such as the Australian Shooting Academy and Mr Murphy have, it must necessarily have beneficial effects in relation to industrial relations. I cannot help but observe that the conduct of the Australian Shooting Academy and Mr Murphy, in relation to the proffering of an apology to employees, is in marked contrast to that which came to my attention on the part of the Commonwealth of Australia in relation to an acknowledged contravention by the Commonwealth of separate obligations which can attend employers under occupational health and safety legislation: see Comcare v Commonwealth of Australia [2011] FCA 1043.
14 The Australian Shooting Academy has admitted to contravening the following:
(a) section 45 of the Fair Work Act for contravening a term of the Modern Award in respect of:
(i) failing to state each term of the modern award that would be varied by the individual flexibility arrangement in accordance with subclause 7.4(b) of the Modern Award;
(ii) failing to detail how the application of each term of the Modern Award had been varied by the individual flexibility in accordance with subclause 7.4(c) of the Modern Award;
(iii) failing to state the date on which the individual flexibility arrangement commenced operation in accordance with subclause 7.4(e) of the Modern Award;
(iv) failing to ensure that the individual flexibility arrangement made with Mr Baxter was generally agreed to without coercion or duress in accordance with subclause 7.2 of the Modern Award.
(b) subsection 340(1) of the Fair Work Act in respect of threatening to take adverse action against Mr Baxter because he had a workplace right, namely being entitled to the benefit of a workplace instrument being the Modern Award and because he made an inquiry about his employment with his employer;
(c) subsection 340(1) of the Fair Work Act in respect of taking adverse action against Mr Swanson because he had a workplace right, namely being entitled to the benefit of a workplace instrument being the Modern Award and because he made an inquiry about his employment with his employer;
(d) subsection 343(1) of the Fair Work Act in respect of threatening to take action against Mr Baxter with the intent to coerce him not to exercise his workplace right, namely being entitled to the benefit of a workplace instrument in the Modern Award; and
(e) subsection 344(c) of the Fair Work Act in exerting undue influence and undue pressure on Mr Baxter in relation to his decision on whether or not to agree to the individual flexibility arrangement.
15 For his part, Mr Murphy admits that he was involved in, within the meaning of s 550(2) of the Fair Work Act, the contraventions alleged against the Australian Shooting Academy, which I have just identified.
16 I note that the Fair Work Ombudsman does not pursue a separately alleged contravention of s 45 of the Fair Work Act in respect of cl 7.3(b) of the Modern Award. The foundation for the proceedings is evident from the recitation of particular sections of the Fair Work Act in the statement which I have made of the contraventions which are alleged and admitted.
17 Sub-section 546(1) of the Fair Work Act enables the Court to order a person to pay a pecuniary penalty in an amount that the Court considers appropriate if satisfied that a person has contravened a civil penalty provision. The provisions to which I have just made reference are civil penalty provisions. I am satisfied on the basis of the agreed statement that the Australian Shooting Academy and Mr Murphy have respectively contravened the civil penalty provisions to which I have made reference. More detailed provision as to what constitutes a civil penalty provision is to found in subs 539(1) and subs 439(2) of the Fair Work Act.
18 Apart from these provisions and the seeking of civil penalties in respect of them, the Fair Work Ombudsman also seeks declaratory relief. The Federal Court of Australia Act 1976 (Cth) confers on the Court a broad discretion in relation to the making of declarations of right. Such declarations are not made as a matter of course. I am satisfied, though, that, in the circumstances of this case, there is a strong public interest in the granting of declaratory relief. Each side promoted the making of such declarations. In that they were not, in my opinion, mistaken as to the aptness of this case for the granting of declaratory relief.
19 In their joint submission and by reference to authority the parties submit that the following approach is one which the Court ought to take in determining the appropriate penalties to impose:
29. The first step for the Court is to identify the separate contraventions involved. Each contravention of each separate obligation found in the Fair Work Act in relation to each employee by the First Respondent is a separate contravention for the purposes of subsection 546(1) of the Fair Work Act.
30. Secondly, to the extent that two or more contraventions have common elements, this should be taken into account in considering what is an appropriate penalty in all the circumstances for each contravention. The First and Second Respondents should not be penalised more than once for the same conduct. The penalties imposed by the Court should be an appropriate response to what the First and Second Respondents did. This task is distinct from and in addition to the final application of the 'totality principle'.
31. Thirdly, the Court will then consider an appropriate penalty to impose in respect of each contravention for each group of contraventions, having regard to all of the circumstances of the case.
32. In cases where the parties have reached agreement in relation to the penalties or penalty ranges to be imposed, the court must be satisfied the penalties fall within the permissible range.
I agree that this is the appropriate approach to take in relation to the imposition of penalty.
20 So far as the pecuniary penalties are concerned column 4 in the table located in subs 539(2) of the Fair Work Act provides the maximum penalty that can be imposed by a court for each contravention of ss 45, 340(1), 343(1) and 344 of the Fair Work Act. That maximum is 60 penalty units. Subsection 546(2) of the Fair Work Act provides that a pecuniary penalty must not be more than:
(a) if the person is an individual - the maximum number of penalty units referred to in column 4 in the table in subsection 539(2) (In other words, 60 penalty units); and
(b) if the person is a body corporate - 5 times the maximum number of penalty units referred to in the relevant item in column 4 of the table in subsection 539(2) (in other words, 300 penalty units).
21 "Penalty unit" is defined in the Fair Work Act in a way that incorporates by reference the meaning given to that term in s 4AA of the Crimes Act 1914 (Cth). The latter section defines a penalty unit to be $110. In this fashion the maximum penalty which may be imposed by the Court is derived as follows:
(a) $33,000 in relation to the Australian Shooting Academy in respect of each contravention (300 x $110);
(b) $6,600 in relation to Mr Murphy, in respect of each contravention (60 x $110).
22 The Australian Shooting Academy has admitted to eight separate contraventions of the Fair Work Act. By process of mathematics one therefore derives a theoretical maximum, subject to considerations to which I shall shortly make reference, of $264,000. In like fashion Mr Murphy's accessorial liability gives rise to a theoretical maximum in respect of the eight admitted accessorial contraventions of $52,800. Those maximums are relevant in the sense that they provide what might be termed a yard stick of comparison as between the present case and the worst possible case.
23 It is common ground between the parties that the admitted contraventions, both corporate and individual accessorial, have common elements. It is also common ground that the contraventions arise from the same unlawful conduct. For these reasons the parties jointly submit that each of these factors should be taken into account by the Court when considering the appropriate penalty. That, they submit, is to ensure that neither respondent is punished more than once for what is the same or a substantially similar course of conduct. I agree with all aspects of those submissions. It is particularly important in this case, in my opinion, to recognise the existence of a course of conduct and of inter-related or overlapping elements in respect of what are acknowledged by the parties to be strictly separate contraventions.
24 There is some recognition of such sentiments in subs 557(1) of the Fair Work Act. That provides that:
… 2 or more contraventions of a civil penalty provision, referred to in subsection (2) are subject to subsection (3) taken to constitute a single contravention if:
(a) the contraventions are committed by the same person; and
(b) the contraventions arose out of a course of conduct by the person.
25 Subsection 557(2)(b) provides that:
Section 45 of the Fair Work Act is a civil remedy provision to which subsection 557(1) applies.
26 Section 45 of that Act, as is evident from the recitation of contraventions, provides that:
A person must not contravene a term of a modern award.
27 Here there are multiple separate contraventions which arise from the applicability of multiple separate clauses in the Modern Award. Section 557 of the Fair Work Act does not apply to contraventions in respect of provisions in Pt 3-1 of the Fair Work Act. There is agreement, though, between the parties that there have been
(a) two separate contraventions of subs 340(1) of that Act in respect of Messrs Baxter and Swanson respectively;
(b) one contravention of subs 343(1) of that Act in relation to Mr Baxter; and
(c) one contravention of subs 344(c) of that Act in relation to Mr Baxter.
28 As to these Pt 3-1 contraventions, the parties correctly, in my opinion, draw attention to an observation by Keane CJ and Marshall J in their joint judgment in QR Limited v Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Service Union of Australia [2010] FCAFC 150 at [49]:
Even if s 557(2) does not apply to a case to oblige to treat as one contravention all the consequences of a particular piece of conduct, it is open to the Court, in an appropriate case, to take into account, as a matter of discretion, the circumstances that the same acts or omissions have resulted in multiple contraventions by multiple breaches of a term cast in similar language in each of multiple agreements, by imposing a lesser penalty or even no penalty in respect of contraventions of some terms, while imposing a substantial penalty in respect of contraventions of other terms.
I propose to adopt that approach in relation to the admitted Pt 3-1 contraventions.
29 The parties submit correctly that the admitted contraventions ought to be characterised into three distinct groups in the following way:
(a) individual flexibility arrangement contraventions comprising three separate contraventions of s 45 of the Fair Work Act for failing to comply with cl 7.4(b), cl 7.4(c) and cl 7.4(e) of the Modern Award;
(b) the Swanson contravention, comprising a single contravention of s 340(1) of the Fair Work Act in respect of Mr Swanson; and
(c) the Baxter contraventions, comprising a contravention of section 45 of the Fair Work Act for failure to comply with cl 7.2 of the Modern Award, a contravention of subs 340(1) of the Fair Work Act, a contravention of subs 343(1) of the Fair Work Act, and a contravention of subs 344(c) of the Fair Work Act.
They submit, again correctly in my opinion, that these three categories of contravention have a common thread. That common thread is that Mr Murphy caused the Australian Shooting Academy to seek to introduce permanent employment with that company through the medium of individual flexibility arrangements. Each of these categories of unlawful conduct was directed to that particular end. The individual flexibility arrangement contraventions are, in substance, very similar. That is because the individual flexibility arrangement was identical in content for each employee. The intent, obviously, was to achieve a uniform result in the workplace. The offers of these arrangements by the Australian Shooting Academy were made at the same time and they were accepted at about the same time by the employees. The parties agree, and the inference is inescapable on the agreed facts, that the introduction of those individual flexibility arrangements was to a single end to which I have already made reference.
30 The parties further submit that the penalties for the Swanson and Baxter contraventions should not be treated as a single course of conduct resulting in a single penalty for these reasons:
(a) the respondents' conduct directed at Mr Swanson was different to that directed at Mr Baxter, both in time and type;
(b) the respondents took adverse action against Mr Swanson by declining to roster him on for any work shifts because Mr Swanson did not sign the individual flexibility arrangement;
(c) the adverse action taken by the respondents against Mr Baxter was constituted by threats made to him on the basis he would not have a job if he did not sign the individual flexibility arrangement;
(d) the threat made by Mr Murphy on behalf of the Australian Shooting Academy to Mr Baxter did not occur in Mr Swanson's presence;
(e) subsection 340(1) of the Fair Work Act also speaks of adverse action against another person in the singular rather than persons in the plural.
They submit, by reference to cases concerning predecessor provisions of s 340(1), which are unnecessary to set out, that it has been held that where a proscribed act impacted on more than one employee, a separate contravention will be taken to have occurred in respect of each employee.
31 Each of these considerations, in my opinion, is relevant to why it is that one ought to treat the Swanson and Baxter contraventions discretely rather than amalgamating them and classifying them as but one course of conduct. The better way, which is the way promoted by the parties, is to regard it as disclosed on the agreed statement of facts that there is a single course of conduct in relation to Mr Swanson and a separate but nonetheless single course of conduct in relation to Mr Baxter. Each of those separate individually specific courses of conduct might be regarded, in my opinion, as a manifestation, or perhaps a furtherance, of the end served by the individual flexibility arrangement contraventions.
32 As to the Baxter contraventions, the parties have agreed that those four contraventions should be grouped as one category and treated as one contravention. That would have the effect that the maximum penalty for each category of contravention, which comprises the Baxter contraventions, is $33,000 for the Australian Shooting Academy and $6600 for Mr Murphy. It will be obvious from the observations that I have just made that I agree with that approach in relation to the Baxter contraventions. What follows from this, so the parties submit, is that the Court should approach the assessment of the relevant maximum on the basis that the maximum penalty that could be imposed by the Court, having regard to the three categories, is:
(a) $99,000 in respect of the Australian Shooting Academy;
(b) $19,800 in respect of Mr Murphy.
33 It necessarily follows from my agreement with the categorisation approach promoted by the parties that I agree that these are the relevant maximums.
34 In Kelly v Fitzpatrick (2007) 166 IR 14 at [14], Tracey J provided a helpful list of considerations that are relevant to the determination of penalty in matters arising under the Fair Work Act. It is important, nonetheless, to recall that helpful though that list is, the considerations set out by his Honour there are not exhaustive of matters which may relevantly be taken to account in the exercise of the sentencing discretion with respect to the imposition of pecuniary penalties. It is quite plain from his Honour's judgment in that case that he did not intend his list to be anything other than a non-exclusive list of relevant considerations.
35 The position which obtains is that the discretion as the imposition of penalty must be exercised in the circumstances of individual cases. Particular care must be taken in the absence of guiding authority at an intermediate appellate level as to appropriate penalties in respect of frequently-encountered contraventions so as not to skew the imposition of penalty by reference to other outcomes in the original jurisdiction in respect of quite different facts. I remind myself that I adopted just such an approach in relation to penalty in Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v QR Ltd (No 2) [2010] FCA 652 at [34].
36 I was informed without objection on the part of the respondents by the Fair Work Ombudsman that this is the first occasion in which it has fallen for the Court to consider the imposition of pecuniary penalties in respect of contraventions of the Fair Work Act related to individual flexibility arrangements. That said, there are some features of this case in respect of which no novel considerations arise. It is axiomatic and each party acknowledges that employees should not be subject to duress, coercion, undue influence or pressure in the workplace. Parliament has expressly so provided in the Fair Work Act. The manifest intention of that legislation is that individual flexibility arrangements should be negotiated openly and freely at arms length between employer and employee without outside interference and without either party being deceived or misled. There is no suggestion, on the facts of this case, of any misleading or deceptive conduct. There is, though, as is acknowledged, evidence of other types of conduct to which I have made reference.
37 The parties submit jointly that the pressure and adverse action applied by the Australian Shooting Academy, by Mr Murphy, to Messrs Swanson and Baxter respectively comprised the following:
(a) informing Mr Swanson and Mr Baxter about the individual flexibility arrangements in a way such that it was conveyed to them that the terms of those arrangements were not flexible or negotiable;
(b) Mr Swanson's removal from the roster and a denial to him of any further rostered shifts as a result of his refusal to agree to the proffered individual flexibility arrangement; and
(c) the threats made to Mr Baxter that he would have no job if he did not agree to and sign the proffered individual flexibility arrangement.
This is an apt way of particularising the conduct which amounts to the pressure and adverse action applied to Messrs Swanson and Baxter.
38 Some facts concerning the operation of the Australian Shooting Academy which are in context mitigating facts need to be set out.
39 When it commenced operation in 1994, neither the Fair Work Act nor for that matter the legislation which gave rise to the "Work Choices" amendments to the Workplace Relations Act 1996 (Cth) were in force. At the time when the Australian Shooting Academy commenced operations it was not covered by any particular state or federal award, or any enterprise agreement. That remained the case until 1 January 2010. However, from 27 March 2006 to 1 January 2010, the Australian Shooting Academy was then bound by the Preserved Pay and Classification Scale derived from the Industrial Relations Act 1999 (Qld) incorporating the State Wage Case 2005 (Qld) from 1 January 2010, the Australian Shooting Academy was bound by the Amusement, Events and Recreation Award 2010 (Modern Award).
40 Messrs Swanson and Baxter were each engaged in the capacity of range officers. In that capacity they undertook a number of duties related to the reception of prospective users of the indoor range, the safe supervision of those shooters on the range, and certain firearms cleaning duties. Each of them, in accordance with then-practices of the Australian Shooting Academy had been engaged, only as casual employees before 25 February 2010. The evidence discloses that such casual employees regularly worked between 30 and 70 hours per week.
41 The contravening conduct took place, therefore, against a background where hitherto the Australian Shooting Academy had not been subject to award regulation for about 16 years. The conduct also took place in the opening months of the operation of the Modern Award as a result of the Fair Work Act's operation. The Australian Shooting Academy had hitherto struck its pay rates in the absence of specific award regulation, by reference to payments made to security guards who were entitled to carry a firearm. It is possible to see a rational basis for such a reference base in terms of the responsibilities which reposed in range officers for the safe use of firearms and the safe custody of firearms.
42 Immediately after being informed that the new federal modern award system might apply to the Australian Shooting Academy, Mr Murphy took steps to seek guidance from the company's accountant to determine what were the company's obligations. On the basis of that advice, he understood that the Modern Award applied to the Australian Shooting Academy's range officers.
43 It is common ground that he was under the impression that the Modern Award did not allow the Australian Shooting Academy to employ casual employees. His understanding was that if they worked a regular pattern of work, they must instead be engaged as permanent employees, either full time or part time. On the basis of that understanding, Mr Murphy then commenced the process of asking the existing Australian Shooting Academy employees to agree to the individual flexibility arrangements. Those arrangements involved the employees converting to permanent status, in which they would receive entitlements to annual and personal leave, whilst also removing entitlements to penalty rates and overtime.
44 There is a wider background which also is relevant to the initiative taken by Mr Murphy. That wider background arises from what had at the time been a steady decline in business at the Australian Shooting Academy from about July 2009. By early 2010 because of that decline in business the Australian Shooting Academy had sought to reorganise its shift arrangements. In so doing, in short, it sought to ensure that its employees retained their jobs and maintained, as far as possible, their hours of work. It may well be that the decline in business from about July 2009 was a reflection of the impact of what has popularly been termed the "global financial crisis". I make that observation because there is reference in the agreed statement of facts to part of the business of the company coming from the tourist trade and in particular from Japanese tourists. Necessarily, to an extent, the business seems to be one which was hostage to the vagaries which can attend the tourist trade and in particular to the impact on that trade of circumstances beyond the control of the Australian Shooting Academy derived from prevailing national and international economic conditions.
45 The conduct then of the Australian Shooting Academy needs to be viewed and the parties invited it to be viewed against the background of a necessary business decision to reduce costs of the company during the first half of 2010. That much acknowledged it nonetheless remains the case that the company was obliged to effect any such reduction in accordance with the requirements of the Fair Work Act.
46 Mr Swanson was a longstanding employee. He had worked for almost 10 years with the Australian Shooting Academy, commencing in June 2000. It is agreed in this case that as a result of the adverse action taken against him, Mr Swanson suffered financially. He did so because he lost his regular and systematic hours at work with the Australian Shooting Academy. It is common ground that he was unable to obtain alternative employment despite his efforts so to do. One consequence of his loss of the regular and systematic hours at work with the Australian Shooting Academy and his inability to secure alternative employment was that Mr Swanson's pension payments from the Commonwealth via the Department of Veterans Affairs increased. I infer from this that Mr Swanson is an ex-serviceman with an entitlement to a means-tested pension under the Veterans' Entitlements Act 1986 (Cth). It emerges from the agreed statement that the Australian Shooting Academy, preferentially it seems, employs persons with a service background as its range officers. That preference is understandable given the emphatic attention to firearm safety, which is a feature of military training in Australia.
47 The respondents have offered compensation to Mr Swanson without deduction in respect of any payments received by him during the period in which he was affected by the contravening conduct. The amount which is offered is agreed in the sum of $7,146.
48 The parties agree that the conduct directed to Mr Baxter was serious because it involved an application of illegitimate pressure which denied him a right to exercise his freewill. I agree. In short, the effect of the conduct was that Mr Baxter lost the opportunity to negotiate the terms and conditions of his employment. There is no previous conduct alleged as against Mr Murphy personally or the Australian Shooting Academy either in relation to like contraventions of earlier legislation, state or federal, or for that matter, any previous contraventions of industrial relations legislation, state or federal. The parties put forward, and it is appropriate to approach the imposition of penalty on the basis, that both the Australian Shooting Academy and Mr Murphy are to be regarded as "first offenders".
49 It also needs to be noted that the business is what is aptly termed by the parties "a small-sized business." It has currently six employees in addition to its two working directors, one of whom, the managing director, is Mr Murphy. It is a business which in the 2009 financial year made a profit. In the 2010 financial year it made a modest loss. When compared with the profit made in the 2009 financial year, that underscores the downturn in business which occurred over the course of that year. I do not propose, because it may have about it a degree of commercial sensitivity, to set out precisely the amounts of profit and loss concerned. Suffice it to say, I have taken the amounts, which are set out in the agreed statement, into account in relation to the imposition of penalty.
50 Even though the business conducted by the Australian Shooting Academy is a small business, it is nonetheless obliged to comply with the law of the land in the form of the Fair Work Act. In relation to the contraventions, it is put forward that the agreed statement of facts does not disclose a deliberate contravention of the Fair Work Act. I agree with that characterisation of the agreed facts. It is apparent that Mr Murphy sought on behalf of the Australian Shooting Academy advice in relation to the phenomenon of new federal regulation of the employment conditions in respect of the company.
51 What occurred thereafter was, as I put to counsel in the course of submissions today, a ham-fisted approach to the negotiation of individual flexibility arrangements. There was an attempted use, in my view, of an inequality in bargaining power in relation to the continuance of regular employment. That should not have occurred. I am quite certain, however, that Mr Murphy well appreciates that and is truly contrite. As I have already observed, he has voluntarily taken steps to cause the company to issue individual letters of apology to the employees concerned.
52 Another manifestation of that contrition is the very studied way in which there has been a cooperation on and from investigation through to the present as between the company and the Fair Work Ombudsman in relation to this matter.
53 There is no doubt that senior management was involved in the contraventions. So much flows from the "hands on" aspect of a small business.
54 An important factor to take into account in relation to the imposition of penalty are the objects of the Fair Work Act, which include particularly in relation to Pt 3-1 the protection of workplace rights and the provision of effective relief for persons who have been discriminated against, victimised or otherwise adversely affected as a result of contraventions of Pt 3-1.
55 There is a need to ensure that the penalties imposed do not trivialise the intent of Parliament in relation to those objects. That said, so far as deterrence is concerned and as will be apparent from what I have already observed, I do not see that specific deterrence is a factor of great moment in this case given the conduct in which the company, via Mr Murphy, has engaged after these matters were drawn to its attention. There is, though, a need to remind employers generally of obligations which arise under the Fair Work Act and to do so in a way which, as I have observed, does not trivialise those obligations. To that extent, general deterrence is a relevant consideration.
56 Bearing these factors in mind, the parties have submitted jointly that, having to the three identified categories of contravention to which I have earlier made reference, the Court should impose penalties within the following range:
(a) in relation to the Australian Shooting Academy between $25,000 and $30,000; and
(b) in relation to Mr Murphy between $5,000 and $6,000.
57 They put forward accurately that these represent 25% to 30% of the maximum penalties that could be imposed for the three categories of contraventions. Again, accurately, they put forward that such an agreed position does not bind the Court as to the amount to impose, that being ultimately a matter for the exercise of a penalty discretion, which reposes per force of statute in the Court, not the parties by agreement: see in this regard Minister for Industry, Tourism and Resources v Mobil Oil Australia Pty Ltd [2004] FCAFC 72 and NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission (1996) 71 FCR 285 at 298-299.
58 That said, it is not irrelevant to take into account a jointly-agreed position where one of the parties to that agreement, namely, the Fair Work Ombudsman, has particular responsibility for the administration of aspects of the Fair Work Act. As it happens, in this instance, my quite separate view of the facts upon reading the agreed statement of facts was that just such a range of penalty was apt. It in no way causes me any disquiet that the parties have come jointly to promote such a range. Further, it seems to me, having regard to mitigating factors to which I have made reference, that the appropriate course to take in this instance is to impose penalties at the lower end of the range.
59 So far as the imposition of penalty is concerned and in relation to the course of conduct and the requirement not to impose double penalty, there is, in my view, an analogy to be drawn in terms of principle between the circumstances of the present case and the quite separate circumstances under quite separate legislation which came before the High Court in L Vogel & Son Pty Ltd v Anderson (1968) 120 CLR 157 at 167 to 168 (Vogel v Anderson). That case concerned the allegation and the consequential finding of serial and separate contraventions of the Customs Act 1901 (Cth) constituted by what could only be regarded on the facts as a single course of conduct directed to a single end. In expressing agreement with observations made in the original jurisdiction by Kitto J, Taylor, Menzies and Owen JJ at page 168 observed that:
Though the offences in each group were separate offences in law, they were substantially contemporaneous and connected.
Their Honours made that observation in the course of expressing agreement that the appropriate approach to sentencing should reflect that view of the facts in terms of the imposition of penalty. There is an analogy between the way in which the parties jointly promoted the imposition of penalty in this case in relation to groups of contraventions and the sentencing approach endorsed in the High Court in Vogel v Anderson.
60 Drawing these disparate considerations together and particularly taking into account a need for general deterrence and not trivialising the conduct concerned, but tempering that with mitigating factors to which I have made reference, the view that I have reached is that the appropriate penalty to impose in respect of the Australian Shooting Academy is a penalty in the sum of $25,000 and the appropriate penalty to impose in respect of Mr Murphy is a penalty in the sum of $5,000. In each instance, it is submitted by agreement that 30 days should be allowed for payment. I allow such a time for the payment of the penalties imposed respectively on the Australian Shooting Academy and Mr Murphy. I also propose to, and do, make declarations in terms of those which have been promoted by the parties. I shall also make provision for compensation in the sum of $7,146.
I certify that the preceding sixty (60) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Logan.