Federal Court of Australia

Western Chinese Language School Incorporated v Fair Work Ombudsman [2026] FCAFC 58

ORDERS

THE COURT ORDERS THAT:

1.    The appeal is dismissed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

THE COURT:

Introduction

1    This appeal concerns a compliance notice (Notice) issued by the Fair Work Ombudsman (FWO) to the Western Chinese Language School Inc (WCLS or Appellant) in September 2022, under s 716(2) of the Fair Work Act 2009 (Cth) (FW Act). The Notice alleged that WCLS had contravened the Social, Community, Home Care and Disability Services Industry Award 2010 (SCHADS Award), and required WCLS to take specified actions. WCLS did not take all of the actions required by the Notice, and the FWO brought proceedings in the Federal Circuit and Family Court of Australia (Division 2) (FCFCOA), alleging that WCLS and the Second Respondent (Mr Chen, the then-Chairperson of WCLS’s School Council) had contravened s 716(5) of the FW Act.

2    The primary judge delivered three judgments in the FCFCOA proceedings, each of which is challenged in this appeal:

    At the beginning of the hearing on liability on 20 January 2025, the primary judge refused to grant WCLS leave to amend its defence: see Fair Work Ombudsman v Western Chinese Language School (No 2) [2025] FedCFamC2G 580 (amendment ruling);

    On 6 March 2025, the primary judge found that WCLS had contravened s 716(5) of the FW Act and that Mr Chen was involved in this contravention: Fair Work Ombudsman v Western Chinese Language School Incorporated [2025] FedCFamC2G 298 (liability judgment or LJ); and

    On 24 July 2025, the primary judge made orders requiring WCLS to take the steps required by the Notice by 4 September 2025 and imposing pecuniary penalties on WCLS and Mr Chen: Fair Work Ombudsman v Western Chinese Language School Incorporated (No 2) [2025] FedCFamC2G 1037 (penalty judgment or PJ).

3    WCLS’s amended notice of appeal raises six grounds of appeal. By grounds 1-3, the Appellant contends that the penalty judgment was based on an erroneous finding of liability in the liability judgment by reason of an incorrect construction of ss 716(1), (2)(a) and (3)(c) of the FW Act. By ground 4, the Appellant contends that the primary judge erred in his construction of the coverage provisions of the SCHADS Award, resulting in an erroneous finding of liability. By ground 5, the Appellant contends that the primary judge erred in the exercise of his discretion to refuse its application to amend its defence. Finally, by ground 6, the Appellant contends that the primary judge erred in the penalty judgment in finding that it contravened s 716(5) by failing to take the actions required by the Notice after the specified date for compliance.

4    For the reasons which follow, we consider that the grounds of appeal which it is necessary for us to determine should be rejected and the appeal dismissed. It is therefore not necessary to determine the FWO’s notice of contention.

Overview

5    The Notice was issued on 12 September 2022 by a Fair Work Inspector (Inspector) appointed by the FWO. In the Notice, the Inspector relevantly alleged that WCLS had contravened identified provisions of the SCHADS Award, and specified actions which she required WCLS to take to remedy this. These actions included calculation and rectification of alleged underpayments of penalty rates for work performed on Saturdays and public holidays. The Notice is discussed in further detail below.

6    The Notice required these actions to be undertaken by 14 November 2022 and evidence provided of compliance to the Inspector by 21 November 2022. It is not in dispute that WCLS did not take all of the actions required by the Notice either by 14 November 2022 or at any relevant later time.

7    On 22 February 2024, the FWO initiated proceedings in the FCFCOA against WCLS and Mr Chen. The FWO alleged that WCLS had contravened s 716(5) of the FW Act by failing to comply with the notice, and that Mr Chen was, under s 550, involved in the contravention and was thereby taken to have also contravened s 716(5). In its Response to the FWO’s application filed on 24 May 2024, WCLS sought that the application be dismissed and additionally sought an order cancelling the operation of the notice pursuant to s 717(3) of the FW Act and a declaration that the Notice was invalid at the point of issue pursuant to s 141 of the Federal Circuit and Family Court Act 2021 (Cth). WCLS’s Defence filed together with the Response (and a Statement of Cross-Claim) included an admission that it did not take any of the actions specified in the Notice.

8    The matter was heard by the primary judge on 20-22 January 2025. At the outset of the hearing, WCLS applied to amend its defence to withdraw the admission referred to above, and to add a contention that it had a reasonable excuse under s 716(6) of the FW Act for not complying with the Notice. In an ex tempore judgment issued on the first day of the hearing, the primary judge refused the application and the trial proceeded. The primary judge subsequently published his reasons, revised from the transcript, for refusing the amendment in the amendment ruling.

9    The primary judge issued the liability judgment on 6 March 2025. The primary judge made declarations that WCLS had contravened s 716(5) of the FW Act by failing to comply with the Notice and that Mr Chen was involved in this contravention within the meaning of s 550(2) of the FW Act, and dismissed WCLS’s application for a review of the Notice under s 717(1).

10    A further hearing as to remedy and penalties was conducted on 8 May 2025. The penalty judgment was published on 24 July 2025. The primary judge ordered that WCLS take the steps required by the Notice by 4 September 2025 (with interest to be added to the required payments) and imposed a penalty of $13,320 upon WCLS and $825 upon Mr Chen.

11    On 20 August 2025, WCLS filed a notice of appeal. The Appellant was granted leave at the hearing to rely on an amended notice of appeal dated 19 March 2026.

Relevant provisions of the statutory scheme

12    Part 2-3 of the FW Act establishes a scheme for the making, variation and revocation of modern awards, including setting minimum terms and conditions for national system employees in particular industries or occupations. Under s 45, a person to whom a modern award applies must not contravene it. Section 45 is a civil remedy provision.

13    Part 5-2 of the FW Act establishes and provides for the functions and powers of the Office of the Fair Work Ombudsman. Under s 696(2), that Office consists of the FWO, the staff of the Office of the Fair Work Ombudsman, and Fair Work Inspectors (FWIs) appointed under s 700. As the guide to Pt 5-2 in s 679 explains, the FWO’s functions include promoting and monitoring compliance with the FW Act, and FWIs exercise compliance powers for determining whether the FW Act is being complied with. The investigatory powers of FWIs are set out in Subdivs D, DA and DB of Div 3 of Pt 5-2.

14    Subdivision DD of Div 3 of Pt 5-2 makes provision for enforceable undertakings and compliance notices. At the time the Notice was issued, s 716 relevantly provided as follows in respect of compliance notices:

716    Compliance notices

Application of this section

(1)     This section applies if an inspector reasonably believes that a person has contravened one or more of the following:

(a)    a provision of the National Employment Standards;

(b)    a term of a modern award;

…

Giving a notice

(2)    The inspector may, except as provided by subsection (4), give the person a notice requiring the person to do either or both of the following within such reasonable time as is specified in the notice:

(a)     take specified action to remedy the direct effects of the contravention referred to in subsection (1);

(b)     produce reasonable evidence of the person’s compliance with the notice.

(3)    The notice must also:

…

(c)    set out brief details of the contravention; and

…

…

Relationship with civil remedy provisions

(4A)    An inspector must not apply for an order under Division 2 of Part 4-1 in relation to a contravention of a civil remedy provision by a person if:

(a)    the inspector has given the person a notice in relation to the contravention; and

(b)    either of the following subparagraphs applies:

(i)    the notice has not been withdrawn, and the person has complied with the notice;

(ii)    the person has made an application under section 717 in relation to the notice that has not been completely dealt with.

Note:    A person other than an inspector who is otherwise entitled to apply for an order in relation to the contravention may do so.

(4B)    A person who complies with a notice in relation to a contravention of a civil remedy provision is not taken:

(a)    to have admitted to contravening the provision; or

(b)    to have been found to have contravened the provision .…

Person must not fail to comply with notice

(5)    A person must not fail to comply with a notice given under this section.

Note:    This subsection is a civil remedy provision (see Part 4-1).

(6)    Subsection (5) does not apply if the person has a reasonable excuse.

15    Section 716(2)(a) was amended by the Fair Work Legislation Amendment (Closing Loopholes No. 2) Act 2024 (Cth), effective from 27 February 2024, so that it now provides:

(a)    take specified action to remedy the direct effects of the contravention referred to in subsection (1) (including to calculate and pay the amount of any underpayment);

(Emphasis added)

16    Section 717 provides for a mechanism for a person who has been given a notice under s 716 to seek a court review of the notice as follows:

717    Review of compliance notices

(1)    A person who has been given a notice under section 716 may apply to the Federal Court, the Federal Circuit and Family Court of Australia (Division 2) or an eligible State or Territory Court for a review of the notice on either or both of the following grounds:

(a)    the person has not committed a contravention set out in the notice;

(b)    the notice does not comply with subsection 716(2) or (3).

(2)    At any time after the application has been made, the court may stay the operation of the notice on the terms and conditions that the court considers appropriate.

(3)    The court may confirm, cancel or vary the notice after reviewing it.

Chronology of events

17    The chronology relevant to WCLS’s appeal is non-controversial and may be summarised as follows.

18    WCLS is (as its name indicates) a Chinese community language school and is located in Melbourne. It is not a registered school. It is registered as a charity. Its revenue is generated from private tuition fees and funding from the Victorian Department of Education. It teaches the Victorian Chinese language curriculum for F-10 students and is authorised as a single study Victorian Certificate of Education language provider. The curriculum includes a component concerning Chinese culture, which is regarded as integral to language learning. WCLS conducts its teaching activities on Saturdays during school terms. Its students are predominantly of Chinese heritage.

19    In March 2021, following the receipt of correspondence from individuals who had been employed by WCLS and/or another Chinese language school, the Office of the FWO (OFWO) commenced an investigation into WCLS. This was primarily conducted by the Inspector with the assistance of other OFWO staff. During the course of the investigation, WCLS provided the Inspector with a number of documents including employment contracts, pay slips, and timesheets, and payroll policies. The Inspector also obtained a number of documents from four WCLS employees, including copies or photos/screenshots of work schedules and pay slips. Additionally, the Inspector made inquiries of other agencies, namely the Victorian Regulation and Qualifications Authority and the Australian Charities and Not-for-profits Commission (ACNC). Arising from her investigation, the Inspector prepared a “Reasonable Belief Document” which set out her findings as to the alleged contraventions of the SCHADS Award and the material and information obtained during the investigation upon which these findings were founded.

20    As earlier stated, the Inspector issued the Notice to WCLS on 12 September 2022. In the Notice, the Inspector stated that she reasonably believed that WCLS had contravened terms of the SCHADS Award and the National Employment Standards (NES) in Pt 2-2 of the FW Act, and that she required WCLS to take steps to remedy the contraventions described in the Notice. The alleged contravention(s) of the NES are not relevant to the appeal and need not be referred to further. Under the heading “Details of the contraventions”, the Notice stated at [6]:

I have made the following determinations in relation to the employees listed in Appendix A (Employees):

(a)    The employment status for each of the Employees is listed in Appendix A.

(b)    The Employees were engaged as Social and Community Services employees with classifications for each of the Employees identified as that listed in Appendix A.

(c)    The above determinations on the Employees’ employment status and classifications and the subsequent determinations on contraventions are in relation to the Employees’ employment periods between 1 October 2016 and 30 June 2021 as listed in the Appendix A (collectively Period).

21    The alleged contraventions of the SCHADS Award were set out in the following table at [7] of the Notice:

Table 1

22    In respect of the alleged contraventions of the SCHADS Award, the Notice relevantly stated:

Required action under this Compliance Notice

8.    In accordance with section 716(2) of the FW Act, I require you by 14 November 2022 to:

Step 1 – calculate and rectify underpayments

(a)     in respect of the contravention referred to in row (a) of the Table 1 above:

(i)    identify each employee listed in Appendix A who was not paid (but was required by the Award to be paid) the Entitlement that is the subject of the contravention – the Entitlement is found in the ‘Details of contraventions’ column of the Table 1 above

(ii)    in respect of each such employee identified:

1.    identify the number of hours the employee worked during the Period in respect of which the Entitlement was required to be paid by the Award (Hours) – ignore this step if the Entitlement is not paid on an hourly basis;

2.    identify the amount the Employer paid to the employee during the Period in respect of the Entitlement (having regard to the Hours, where applicable);

3.    calculate the amount the Employer should have paid to the employee during the Period in respect of the Entitlement (having regard to the Hours, where applicable);

4.    make a payment to the employee of the difference between the amount referred to in (a)(ii)(2) and the amount referred to in (a)(ii)(3) immediately above; and

5.    make a record of the information and amounts referred to in (a)(ii)(1) to (a)(ii)(3) and the amount of the payment referred to in (a)(ii)(4) immediately above (Underpayment Rectification Information).

(b)     repeat the same process described in Step 1(a) for each of the contraventions referred to in rows (b) to (c) of the Table 1 above.

23    Paragraphs [9] and [10] of the Notice required WCLS to produce specified evidence of compliance with the required actions by 21 November 2022. Appendix A set out, in tabular form, the names of the four relevant employees, their employment start date, their employment end date (in one case only), their employment status (Part Time or Casual) and their classification under the SCHADS Award.

24    On 7 November 2022, Mr Chen sent an email to the FWO on behalf of WCLS which attached calculations of the underpayment amounts for the four employees as requested in the Notice. On 11 November 2022, a representative of the FWO, Ms Merritt, advised Mr Chen that the calculations were being reviewed. On 14 November 2022, being the date specified in the Notice for WCLS to take the required actions, Ms Merritt telephoned Mr Chen and advised him that the calculations were under review and to hold off making payment if that had not been done yet. On 14 November 2022, Mr Chen sent Ms Merritt an email stating that WCLS had not made the required payment because it had not received confirmation of the calculations from the FWO and requesting advice as to whether the calculation was “approved by FWO ASAP”. In response, Ms Merritt sent Mr Chen an email on 15 November 2022 which relevantly stated:

The review of the calculations is still being undertaken and we will provide a response as soon as possible. While we note that the due date for payment was Monday, 14 November 2022, no action will be undertaken by the Fair Work Ombudsman in relation to the compliance notice while the calculations are under review.

25    On 9 December 2022, the Inspector emailed Mr Chen advising that, on reviewing WCLS’s calculations, it had become apparent that incorrect SCHADS Award pay guides had been sent to WCLS on 12 September 2022. The email attached what were said to be the correct pay guides and requested that WCLS redo that calculations by reference to these. WCLS was invited, if it would assist, to provide the new calculations to the FWO before making any payments to the employees.

26    WCLS did not subsequently provide the FWO with any evidence of compliance with the Notice. On 23 March 2023, Mr Chen advised Ms Merritt by email that WCLS’s school council had met and decided that the SCHADS Award did not apply to it. Further exchanges of correspondence between the FWO and WCLS through to 13 November 2023 did not take the matter any further.

27    As earlier stated, the FWO initiated proceedings against WCLS on 22 February 2024. The FWO’s Statement of Claim filed on that date pleaded at [11] that WCLS had failed to take the actions specified in the Notice by 14 November 2022 or at all, and had failed to produce to the FWO evidence of compliance by 21 November 2022 or at all. The particulars provided in respect of this pleading included express reference to Mr Chen’s email of 7 November 2022 and Ms Merritt’s email of 15 November 2022. WCLS’s Defence pleaded in response to [11] of the Statement of Claim:

Save to admit that it did not take any of the Specified Actions specified in the Compliance Notice, it denies paragraph 11 and says further that it was not obliged to take the Specified Actions, because the Compliance Notice was not valid.

28    In July 2024, the primary judge set the matter down for a three-day trial commencing on 20 January 2025. On 12 September 2024, the FWO filed the affidavit of Steven Leslie Williams, a Fair Work Inspector. An exhibit to this affidavit contained documents evidencing the communications between WCLS and the FWO of 7, 11 and 14 November 2022 described above. WCLS’s written submissions of 24 December 2024 did not identify, as a defence, that these documents gave rise to a defence of reasonable excuse under s 716(6) of the FW Act. However, on 16 January 2025, WCLS’s counsel formed the view that these documents supported a defence that WCLS had either complied with the Notice or had a reasonable excuse for not doing so. On 17 January 2025, WCLS’s solicitors wrote to the FWO advising of these circumstances and enclosing a draft amended defence (its counsel having informally advised the FWO’s counsel of its intention to amend the previous day). As already stated, WCLS moved to amend its defence on the first day of the trial on 20 January 2025, and this was rejected by the primary judge the same day.

Appeal grounds 1-3 – alleged non-compliance with FW Act s 716

29    Appeal grounds 1 to 3 contend in different ways that the Notice is invalid, because it does not comply with the requirements of s 716 of the FW Act.

    Ground 1 contends that s 716(1) of the FW Act only empowers an inspector to issue a notice where he or she has formed a reasonable belief in respect of specific contraventions of the FW Act occurring at specific times or on specific occasions, whereas the Notice was based on a belief as to a course of conduct which “roved” across a period of five years (see LJ at [70]-[74]).

    Ground 2 contends that the power of an inspector in s 716(2)(a) of the FW Act to include in a notice a requirement that the recipient “take specified action to remedy the direct effects of the contravention” did not extend to a requirement that the recipient calculate the amount of an alleged underpayment, particularly by requiring it to identify for itself the essential integers of the alleged contravention (see LJ at [87]-[93]).

    Ground 3 contends that, contrary to LJ at [100], the requirement in s 716(3)(b) that a compliance notice set out the “brief details” of the alleged contravention is not satisfied by a notice broadly stating:

i.     that the alleged contravention related to a particular entitlement;

ii.     the employees to whom the alleged contravention related;

iii.     the period to which the alleged contravention related; and

iv.     the clauses of the instrument to which the alleged contravention related.

30    The starting point for the ascertainment of the meaning of a statutory provision is the text of the statute whilst, at the same time, regard is had to its context and purpose: SZTAL v Minister for Immigration and Border Protection (2017) 262 CLR 362; [2017] HCA 34 at [14] (the Court). Appeal grounds 1 to 3 fasten on different aspects of s 716, which each relate to the same contravention(s) of the FW Act:

    An inspector must “reasonably believe” that a person has contravened (relevantly) a term of a modern award (s 716(1); appeal ground 1).

    A compliance notice may require that a person take “specified action” to remedy the “direct effects” of the contravention referred to in s 716(1) (s 716(2)(a); appeal ground 2).

    The notice must (relevantly) set out “brief details” of the contravention; that is, the contravention in s 716(1) (s 716(3)(c); appeal ground 3).

Appeal grounds 1 and 3: Reasonable belief and brief details

31    It is convenient to consider appeal grounds 1 and 3 together, because the Appellant’s arguments about the meaning of “reasonable belief” and “brief details” of a contravention are closely related.

32    On appeal ground 1, the Appellant submits that an inspector must hold a belief in respect of “the contravention”, when s 716(1) is read with ss 716(2) and (3). The Appellant submits further that each time an employer does not pay an employee in accordance with an award, that amounts to a separate contravention of the award. From these premises, the Appellant submits that a reasonable belief under s 716(1) cannot be based on a course of conduct (as occurred here), but requires a belief based on information about the specific times or occasions on which the employee was not paid in accordance with the award.

33    The first two steps in the Appellant’s argument are correct. But the conclusion does not follow, either as a matter of construction of s 716(1) or on the facts of this case.

34    As a matter of construction, the concept of “reasonable belief” as to a contravention of an award is sufficiently broad to include a belief based on a course of conduct.

35    First, as the primary judge held, a reasonable belief requires sufficient material to “induce an inclination of the mind”, may exist “on more slender evidence than proof” and, depending on the circumstances, may “leave something to surmise or conjecture”: LJ at [70], [72], quoting George v Rockett (1990) 170 CLR 104; [1990] HCA 26 at 112, 116. It is true, as the Appellant submits, that a compliance notice is issued under s 716 after an investigation, whereas a search warrant (as considered in George v Rockett) is issued during an investigation. However, Parliament has chosen to use a term with a well-established meaning in s 716, and that meaning should be applied.

36    Second, as the primary judge held, this conclusion is strongly supported by Fair Work Ombudsman v Grouped Property Services Pty Ltd (2016) 152 ALD 209; [2016] FCA 1034, which considered accessorial liability for being “knowingly concerned” in a contravention under s 550(2)(c) of the FW Act: LJ at [68]-[70]. In Grouped Property Services at [957], Katzmann J held:

… where an alleged accessory is aware of a system producing certain outcomes, and those outcomes constitute contraventions of the Act, it is unnecessary to show that the alleged accessory knew the details of each particular instance of those outcomes in order to show the requisite knowledge.

37    Although there are differences between accessorial liability and a compliance notice (as the Appellant submits), those differences only strengthen the conclusion reached by the primary judge. If a knowledge requirement in s 550(2)(c) can be based on knowledge of a course of conduct (and does not require knowledge of the details of each particular instance), then it must follow that a reasonable belief requirement in s 716(1) can also be based on a course of conduct. Belief is a less demanding standard than knowledge.

38    The broader legislative context also supports the primary judge’s conclusion. In specified civil penalty proceedings (including for contraventions of modern awards), multiple contraventions may be treated as a single contravention if they are committed by the same person and arose out of a course of conduct by the person (FW Act s 557). It would be surprising if it were permissible to take account of a course of conduct in court proceedings for the imposition of a pecuniary penalty, but not in forming a reasonable belief for the purposes of a compliance notice. The Appellant contends that s 557 in fact supports its argument that multiple contraventions of an award are distinct, in the absence of statutory provision to the contrary. But the issue with s 716 is the permitted basis for forming a reasonable belief in relation to multiple contraventions arising out of a course of conduct, which takes as its premise that the contraventions are distinct. The Appellant’s construction arguments on appeal ground 1 should be rejected.

39    On the facts of this case, we agree with the primary judge that there was substantial material before the Inspector to reasonably induce a belief that WCLS was not meeting its minimum award obligations as to Saturday rates of pay for the named part-time and casual employees, because it had a system of paying a flat rate less than the Award minimums: LJ at [70]. Similarly, the material demonstrating the payment of a flat rate on ANZAC Day 2020 (which fell on a Saturday), as part of WCLS’s system of paying a flat rate, was sufficient to induce a belief that WCLS had not paid the required public holiday penalty rates across any other public holidays which coincided with the working days of WCLS’s employees across the whole period of the Notice: LJ at [71]. As just explained, the Inspector did not require material relating to each instance of non-payment. Therefore, there was no difficulty with the Inspector forming a reasonable belief that WCLS had not paid the named employees the required amount for those Saturdays or public holidays on which the employees had worked during the relevant period, even if the Inspector did not know exactly which Saturdays or public holidays those were.

40    In oral argument, the Appellant sought to make something of the fact that some of the employees had referred in discussions with the Inspector to not being paid for work outside standard hours; for example, marking and attending school meetings. However, the FWO correctly points out that the details of the contravention in respect of Saturdays only applies to “ordinary hours” worked between midnight on Friday and midnight on Saturday: see paras (a) and (b) in Table A in [7] of the Notice, set out in [21] above.

41    These conclusions on appeal ground 1 also largely answer the Appellant’s arguments on appeal ground 3. The primary judge accepted WCLS’s submission that the “brief details” required by s 716(3)(c) must provide the recipient with sufficient information to permit it to make an informed choice as to its response: LJ at [97]. However, his Honour held that a compliance notice that sets out the critical facts and the relevant provision(s) giving rise to the alleged contravention will meet that requirement: LJ at [99]. We agree. In Lendlease Building Contractors Pty Limited v Australian Building and Construction Commissioner (No 2) [2022] FCA 192 at [140], Snaden J took a similar approach to the corresponding requirement in s 99(3)(c) of the previous Building and Construction Industry (Improving Productivity) Act 2016 (Cth).

42    Here, the Appellant accepts in appeal ground 3 that the Notice set out (i) the entitlement to which the alleged contravention related; (ii) the employees to whom the alleged contravention related; (iii) the period to which the alleged contravention related; and (iv) the clauses of the Award to which the alleged contravention related. Once it is recognised that s 716(1) does not require that the Notice set out the specific dates of every contravention, there is no reason why the requirement in s 716(3)(c) to provide “brief details” of the contravention would require any greater detail than this.

43    Appeal grounds 1 and 3 must be rejected.

Appeal ground 2: Specified action to remedy direct effects

44    Appeal ground 2 contends that the Notice did not set out “specified action” to remedy the “direct effects” of the contravention identified within s 716(2)(a), because it required WCLS to calculate for itself the amount of an alleged underpayment, which (it is said) required WCLS to identify the essential integers of the alleged contraventions.

45    This argument arises out of [8] of the Notice, set out in [22] above. “Step 1” required WCLS to take the following steps in relation to the Award entitlement that was the subject of the contravention for each employee listed in Appendix A (as identified in [7] of the Notice):

(1)    identify the hours that the employee worked during the period in respect of which the entitlement was required to be paid by the Award (although this step was to be ignored if the entitlement was not paid on an hourly basis);

(2)    identify the amount it paid to the employee during the Period in respect of the entitlement (having regard to the hours, where applicable);

(3)    calculate the amount it should have paid to the employee during the Period in respect of the entitlement (having regard to the hours, where applicable);

(4)    make a payment to the employee of the difference between those two amounts; and

(5)    make a record of the information and amounts referred to in (1)-(3) and the amount of the payment in (4).

46    The Appellant submits, correctly, that the power in s 716 cannot be used to determine whether the FW Act or fair work instrument is being or has been complied with (see FW Act s 706(1)(a)). The Appellant further submits that the steps set out above are so extensive that the Inspector is not enforcing a contravention, but rather requiring WCLS to identify what the contravention was. The Appellant’s argument focuses on two aspects of s 716(2)(a): the Notice must set out “specified action”, which must be to remedy the “direct effects” of the contravention.

47    Starting with specified action, the word “specified” requires clarity and precision: see for example Tickner v Chapman (1995) 57 FCR 451; [1995] FCA 1726 at 457-458 (Black CJ), 480-481 (Burchett J), 491-492 (Kiefel J); Evans v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 135 FCR 306; [2003] FCAFC 276 at [25] (Gray J), [43] (Kenny J). However, it is permissible to specify a matter by reference to a class or classes of matters: see Acts Interpretation Act 1901 (Cth) as in force on 25 June 2009, s 46(3), applied by FW Act s 40A. The specification of a matter by class may require some factual inquiry to determine whether something falls within the class. Accordingly, the bare fact that some factual inquiry might be required to determine the scope of a matter does not, in itself, mean the matter is not “specified”, as long as the matter can be identified with certainty and precision: see Evans at [23] (Gray J), discussing NAAO v Secretary, Department of Immigration and Multicultural Affairs (2002) 117 FCR 401; [2002] FCAFC 64 at [33]-[40] (the Court) and Concord Council v Optus Networks Pty Ltd (1996) 131 FLR 294 at 318 (Dunford J).

48    In other words, as with the “brief details” requirement in s 716(3)(c), s 716(2)(a) requires that the remedial action required by a compliance notice be set out in sufficient detail so that the recipient is not left to speculate what action is required. The degree of specificity necessary to achieve this result will depend on the circumstances. Here, the steps set out in [8] of the Notice were sufficiently clear to inform WCLS what steps were required. The primary judge recognised in the penalty judgment that undertaking these steps would require “significant time and administrative effort” from WCLS, but (as his Honour stated) this does not mean there is a lack of precision: PJ at [77].

49    The steps specified in the Notice are also properly seen as remedying the “direct effects” of the contraventions. As stated in dealing with appeal ground 1, it is permissible for a reasonable belief as to a contravention of an award to be based on information about a course of conduct. Given that is permissible, it must follow that the “direct effects” of those contraventions could include taking whatever steps are required to calculate the precise amounts of the contraventions arising out of that course of conduct (as recognised by the primary judge: LJ at [89]). To do so is not to investigate whether there is a contravention, but to quantify contraventions that have already been identified. As the primary judge pointed out, these calculations will be performed using records that WCLS was required by law to maintain (and thus do not require WCLS to obtain new information): LJ at [90], referring to FW Act s 535.

50    The Appellant seeks to draw something from the two examples used in the Explanatory Memorandum to the Fair Work Bill 2008 (Cth) to illustrate the differences between direct and indirect effects in this context. The first example (of a “direct action”) given is that an inspector could give an employer a compliance notice requiring it to remedy the direct effect of an underpayment by paying the employee $100: Explanatory Memorandum at [2767]. The second example (of an “indirect action”) is that an inspector who reasonably believed that an employer had underpaid employee A $250 could not give an employer a compliance notice requiring it to conduct an audit of all its employees’ wage entitlements to make sure that it was not underpaying employee A. That is because the requirement to audit its employees’ wage records goes beyond remedying the direct effects of the contravention for which the notice was given: Explanatory Memorandum at [2687].

51    The FWO correctly submits that these illustrative examples do not suggest that the “direct effects” of a contravention are confined to paying a defined sum, and cannot include steps requiring the employer to calculate the amounts that have been underpaid. The key difference in the second example is that the notice required the employer to audit all of its employees’ wage records, which goes beyond the extent of the inspector’s reasonable belief. Here, by contrast, the steps required relate only to those employees in respect of whom the Inspector had a reasonable belief that they had been underpaid, in contravention of the SCHADS Award.

52    A final point is to consider the effect of the 2024 amendment to s 716(2)(a), and which now expressly authorises a compliance notice to require the recipient to “calculate and pay the amount of any underpayment”: see [15] above. The stated reason for this amendment was to “clarify” the scope of s 716(2): see Explanatory Memorandum to the Fair Work Legislation Amendment (Closing Loopholes) Bill 2023 (Cth) at [839], [843]. The amendment does not affect the conclusions set out above.

53    Appeal ground 2 must also be rejected.

Appeal ground 4 – coverage of the SCHADS Award

54    Appeal ground 4 of the amended notice of appeal is as follows:

Award Coverage Ground: The PJ was based upon an erroneous finding of liability in the LJ, by which the learned primary judge erred in:

a.     applying an incorrect construction of clause 3.1 of the Social, Community, Home Care and Disability Services Industry Award 2010 to the facts…, namely that the phrase “community development work” within the definition of the “social and community services [sector]” encompassed the business of the Appellant (LJ, [30]-[38]), whereas, on a proper construction, it did not; and

b.     finding that the School’s business was engaged in “community development work”, properly construed (LJ, [31]).

55    The premise upon which this appeal ground proceeds is that if the SCHADS Award did not apply to WCLS in respect of the four employees the subject of the Notice during the employment periods specified in the Notice, WCLS would not have committed that contraventions alleged in the Notice and, as a consequence, the Notice was liable to be cancelled pursuant to s 717(3) on the ground specified in s 717(1)(a). This was common ground at first instance: LJ at [15].

56    The relevant parts of the coverage provisions of the SCHADS Award remained unaltered during the periods of employment specified in the Notice. Clause 4.1 provides:

4.    Coverage

4.1     This industry award covers employers throughout Australia in the:

(a)    crisis assistance and supported housing sector;

(b)    social and community services sector;

(c)    home care sector;

(d)    family day care scheme sector;

and their employees in the classifications listed in Schedule B to Schedule E to the exclusion of any other modern award.

57    Clauses 4.2 to 4.5 specify exclusions to coverage, and cls 4.6 and 4.7 extensions of coverage, which are not presently relevant. Clause 4.8 provides:

4.8     Where an employer is covered by more than one award, an employee of that employer is covered by the award classification which is most appropriate to the work performed by the employee and to the environment in which the employee normally performs the work.

58    Clause 3.1 defines the expression ‘social and community services sector’ used in cl 4.1(b) as follows:

social and community services sector means the provision of social and community services including social work, recreation work, welfare work, youth work or community development work, including organisations which primarily engage in policy, advocacy or representation on behalf of organisations carrying out such work and the provision of disability services including the provision of personal care and domestic and lifestyle support to a person with a disability in a community and/or residential setting including respite centre and day services…

(Emphasis added)

59    In the liability judgment, the primary judge accepted the FWO’s contention that WCLS’s substantial character was engagement in community development work in the community services sector: LJ at [31]. The primary judge made a number of findings of fact upon which the conclusion was founded: LJ at [23]-[29]. The primary judge found that, as an integral part of its language education work WCLS’s employees taught, and its students participated in, cultural activities such as dance, paint, travel, calligraphy and cooking. WCLS was not a mainstream registered or accredited school, the four employees the subject of the Notice were not registered teachers, and the work of WCLS complemented mainstream school language education. Under WCLS’s funding agreement with the Victorian Department of Education and Training, it was to provide an out-of-school hours Chinese language program that “complements language education provided by mainstream schools, with a particular focus on enabling students to maintain their mother tongue or heritage language”. WCLS’s constitution provided that its purposes were:

1.    Providing Chinese language and culture services for local community members;

2.    Providing a communication platform for people of different cultural backgrounds;

3.    Encouraging local young people to understand each other in cultural learning experience[s].

60    Similarly, WCLS’s ACNC annual information statement described its ‘activities and outcomes’ as being the ‘[a]dvancement of Chinese language education, and advancement of Chinese culture and other activities, and its annual financial report stated that its main purpose was ‘to promote Chinese language & cultural activities’.

61    The primary judge concluded that the activities described in the documents the subject of the above findings constituted community development work in the social and community services sector, stating that “[t]he development of language and culture is within the ambit of the ordinary or usual meaning of the words community development work”: LJ at [31]. The primary judge rejected WCLS’s argument that the inclusion in the definition of social and community services sector of “social work, recreation work, welfare work, youth work… the provision of personal care and domestic and lifestyle support” connoted something conceptually distinct from WCLS’s services, reasoning that (LJ at [32]):

The list of work is inclusive and non-exhaustive. I see no reason to read down the definition so as to exclude a community language school when the substantial character of its enterprise is within the ambit of the social and community services sector within the ordinary and usual meaning of the words.

62    The primary judge also rejected WCLS’s submission that it was in the education sector rather than the social and community services sector, stating that this did not proceed on an interpretation of the ordinary and usual meaning of the words in the SCHADS Award, and referred to the decision of the South Australian Employment Tribunal (SAET) in Nguyen and Le v Vietnamese Catholic Community in SA Inc [2019] SAET 68 which found that the SCHADS Award covered and applied to a Vietnamese community language school: LJ at [33]-[34]. The primary judge finally noted that cl 4.8 of the SCHADS Award did not arise for consideration because WCLS did not contend that more than one award applied and a classification in another award was the “most appropriate” classification for the employees the subject of the Notice.

63    Appeal ground 4, like appeal grounds 1-3, is framed as one of an error of construction. WCLS contends that the primary judge erred in applying an incorrect construction of the phrase “community development work” within the definition of “social and community services sector” in cl 3.1 of the SCHADS Award, namely that it encompassed WCLS’s business, whereas on a proper construction it did not. Relatedly, WCLS contends that the primary judge erred in finding that its business was engaged in “community development work”, properly construed. In support of this ground, WCLS submits that “community development work” is a very broad phrase upon which some sensible limitation must be imposed so as not to render it meaningless. The primary judge’s conclusion that the development of language and culture is within the ambit of the ordinary or usual meaning of “community development work” would result in any number of services that have a beneficial impact satisfying that phrase. It submits that the other types of work referred to in the definition of “social and community services sector”, such as social work, recreation work, welfare work, youth work, the provision of personal care, domestic and lifestyle support, connote something conceptually distinct from the work performed by a teacher in a school. The substantial character of the industrial enterprise in which WCLS and the relevant employees were engaged is that of a school teaching the Chinese language, with the cultural element being a curriculum-mandated element of its Chinese language teaching activity. The primary judge’s finding that WCLS’s aim of advancing Chinese culture and language and encouraging intercultural learning leads to a characterisation of WCLS and its teachers as “community development work” is no more correct than it would be when applied to any mainstream school teaching foreign languages. The correct conclusion, WCLS submits, is that the SCHADS Award did not cover nor apply to it, so the Notice was liable to being cancelled pursuant to s 717(3) on the basis that WCLS did not commit the contraventions alleged in it.

64    WCLS’s submissions do not clearly state what it contends to be the correct construction of the expression “community development work” in cl 3.1, nor do they identify the “sensible limitation” which it contends should be placed on the expression. The premise of WCLS’s case appears to be that whatever “community development work” means, it does not encompass business activities which have the substantial character of language teaching or education. Why that is the case as a matter of the proper construction of the words used in the expression, read in contest, is not readily ascertainable in WCLS’s submissions.

65    The principles applicable to the interpretation of modern award provisions, including coverage provisions, were not in issue and are in any event well-established. The starting point is a consideration of the natural and ordinary meaning of the words used in the award. The award’s terms must be read as a whole, in context, and having regard to their purpose(s), and must not be construed in a vacuum, divorced from industrial realities: City of Wanneroo v Holmes (1989) 30 IR 362; [1989] FCA 369 at 378 (French J); Kucks v CSR Ltd (1996) 66 IR 182 at 184 (Madgwick J); Transport Workers’ Union of Australia v Coles Supermarkets Australia Pty Ltd (2014) 245 IR 449; [2014] FCAFC 48 at [22] (Siopis, Buchanan and Flick JJ); BioGiene Pty Ltd v Mullan [2022] FCAFC 73 at [26] (Charlesworth and Snaden JJ, O’Callaghan J agreeing at [62]); Health Services Union v Catering Industries (NSW) Pty Ltd (2023) 324 IR 337; [2023] FCAFC 82 at [57] (Katzmann, Snaden and Raper JJ).

66    The phrase “community development work”, according to the ordinary meaning of its component words, has a very broad import, as the primary judge found (LJ at [30]) and WCLS accepted. The word “community” has a wide variety of connotations and, at its broadest, can refer to the entirety of “the public” but, relevantly, it includes the meaning “a group of people within a society with a shared ethnic or cultural background, especially within a larger society: the Aboriginal community; Melbourne’s Greek community”: Macquarie Online Dictionary. The verb “develop” bears the meaning “to bring out the capabilities or possibilities of; bring to a more advanced or effective state”, with the noun “development” meaning “the act, process or result of developing”: ibid. Thus, “community development work” as a compound expression is capable of encompassing work with the function or purpose of advancing the capability or potential of an ethnic or cultural group within Australian society.

67    Neither textually nor conceptually is there any basis to read “community development work” as excluding language teaching activity. WCLS did not point to anything in the text that leads to this result and, conceptually, it can readily be accepted that the teaching of a particular language may serve the development of an ethnic or cultural group to which that language relates, particularly where (as here) the language teaching involves a significant cultural component. That “community development work” is a broad concept does not render it meaningless, as WCLS submits, nor does it require some anteriorly-derived limitation not based on the text to be imposed upon it.

68    The broader context of the SCHADS Award provides no support for WCLS’s contention that it is incapable of covering language teaching work. As earlier explained, cl 3.1 defines the “social and community services sector”, which the award covers by virtue of cl 4.1(b), as meaning “the provision of social and community services”, with the definition then providing a non-exhaustive list of categories of work which fall within this broad formulation. Having regard to the breadth of the term “social and community services” and the inclusion of examples such as “recreation work” and “youth work”, there is no contextual reason why some limitation upon “community development work” ought be implied. It is also significant that WCLS does not contest that the classifications in the SCHADS Award are capable of application to the work of the four employees the subject of the Notice.

69    A modern award covers an employer and employees if it is expressed to cover them: FW Act s 48(1). For the reasons stated, that part of the coverage of the SCHADS Award which applies to “community development work” is apt to describe the substantial character of the work performed by the relevant employees for WCLS. That WCLS had this character is amply demonstrated by the primary judge’s findings of fact, including that its purpose as described in its constitution included the provision of “Chinese language and culture services for local community members”.

70    As the primary judge observed (LJ at [36]), WCLS did not contend that any other modern award covered it in respect of the four employees, so no question arises under cl 4.8 as to whether the classifications under some other award are more appropriate to apply to the work performed by the employees and the environment in which they formally perform that work. Finally, the conclusion that the SCHADS Award covers community language schools is neither novel nor surprising. That was the conclusion of the SAET in Nguyen, which decision was affirmed on appeal to this Court in Nguyen v Vietnamese Catholic Community in SA Inc trading as Dac Lo Vietnamese Ethnic School [2021] FCA 231 (White J), albeit that the issue of coverage was not contested in the appeal. That the SCHADS Award covered a Chinese language school was also not in contest in Wei v Chinese Australian Services Society Ltd [2020] FCCA 1293 (Judge Altobelli), affirmed on appeal in respect of the finding of a contravention of the SCHADS Award in Chinese Australian Services Society Limited v Sun [2022] FCA 1076 (Snaden J).

71    Appeal ground 4 is rejected.

Appeal grounds 5 and 6 – refusal of leave to amend and whether a continuing obligation to comply with the Notice

72    By ground 5 of the appeal, WCLS challenges the primary judge’s decision at the beginning of the trial on 20 January 2025 to refuse its application to amend its defence. The substantive purpose of the amendment which WCLS sought to make was to allow it to raise a defence of reasonable excuse under s 716(6) of the FW Act. The factual foundation for this putative defence was that the documents exhibited to Mr Williams’ affidavit demonstrated that, prior to the time for compliance specified in the Notice (that is, by 14 November 2022), WCLS had provided calculations of the amounts of the underpayments specified in the Notice and (via Mr Chen) had been told by a representative of the FWO on 14 November 2022 to hold off making payment until WCLS’s calculation had been reviewed. That defence, if allowed, could only have succeeded if s 716(5) were construed as providing for no continuing obligation to comply with a notice issued under s 716(2) once the time for compliance specified in the notice had expired.

73    The refusal of leave for WCLS to amend its defence did not dispose of the issue of whether s 716(5) imposed a continuing obligation for compliance. That was because Mr Chen, in response to the FWO’s allegation against him of accessorial liability under s 550 of the FW Act for WCLS’s alleged contravention of s 716(5), contended that he could not have been an intentional participant in any contravention by WCLS because he had acted in accordance with the FWO’s communication of 14 November 2022 to hold off payment. Mr Chen, who was self-represented, had not previously filed or served a defence (LJ at [103]) and thus was not bound by the admission which WCLS had made in its defence.

74    The primary judge found (LJ at [140]):

As of 14 November 2022 — the time specified for the taking of the action — Mr Chen could not have been an intentional participant in any contravention of WCLS because he acted in accordance with the FWO’s extant and express direction to hold off making any underpayment until the FWO’s review of the calculations was complete.

75    Consequently, the primary judge was obliged to consider whether Mr Chen’s conduct after 14 November 2022 was capable of constituting intentional participation in a contravention by WCLS of s 716(5). The primary judge determined that the obligation under s 716(5) was one which continued after the time specified in the Notice for compliance had passed, absent a reasonable excuse, and referred in support of that conclusion to Brammer v Deery Hotels Pty Ltd (1974) 22 FLR 276 at 277-9 (Joske J) and Jones v Lorne Saw Mills Pty Ltd (1962) 3 FLR 234 (Cussen J). He found that by 13 November 2023, when correspondence between the FWO and WCLS was exhausted, any reasonable excuse was spent and Mr Chen knew the Notice had not been complied with: LJ at [142]-[145].

76    Notwithstanding that, for the reasons set out in the liability judgment, the primary judge made declarations that WCLS had contravened s 716(5) and that Mr Chen had been involved in this contravention, the issue of whether s 716(5) imposed a continuing obligation of compliance re-emerged at the penalty hearing. This was because WCLS submitted that any pecuniary penalty against it should be in the low range, or there should be no penalty at all, because the findings of contravention only arose due to the admissions it made in its defence and, had it been allowed to amend its defence, no such finding would have been made. This submission was, again, founded on a contention that s 716(5) did not impose upon WCLS any obligation to comply with the Notice after the date specified in the Notice to take the specified actions. The primary judge rejected this submission in the penalty judgment at [39]:

I adhere to my analysis in the liability judgment. In considering the nature and extent of the conduct, while, as set out above, I accept that WCLS’[s] cooperation up until 14 November 2022 mitigates the penalty which might otherwise be appropriate to meet the needs of deterrence, it is appropriate for me to take into account that after 14 November 2022 and continuing now (even after the liability judgment) WCLS has taken no step to comply with the Compliance Notice.

77    By ground 6, WCLS contends that the primary judge erred in finding that it has contravened s 716(5) by failing to take action to comply with the Notice after the date specified in the Notice and that this was a matter relevant to penalty. This alleged error is founded on the contention that, on its proper construction, s 716(5) only prohibits a person from failing to comply with a notice by taking the specified action by the time specified in the notice for the purposes of s 716(2), and consequently that the Notice did not require any action to be taken, and was not capable of being complied with, after the specified date of 14 November 2022.

78    WCLS accepts that, if it does not succeed on ground 6, it is unnecessary to determine ground 5 because even if the amendment to WCLS’s defence had been allowed, the amended defence could not have succeeded, and thus any error in the primary judge’s decision to refuse the amendment lacks materiality. For that reason it is convenient to consider ground 6 first.

Ground 6 – does s 716(5) impose a continuing obligation to comply with a notice?

79    WCLS submits the primary judge’s analysis in the liability judgement was in error in that the Notice, construed consistently with s 716(2) by which it was empowered to be issued, expressly tied the obligation to take the actions specified in the Notice to the time given to do so. It was therefore not legally possible to fail to comply with the requirement in the Notice after the time specified for doing so had passed. WCLS submits that Brammer, to which the primary judge referred, was distinguishable, and relies on Sloggett v Adams (1953) 70 WN (NSW) 206 and Joseph v Worthington (2018) 272 A Crim R 292; [2018] VSCA 102 in support of the proposition that s 716(5) imposes a “once and for all” obligation for compliance that is complete once the time specified in the compliance notice has expired.

80    The FWO relies on Leydon v Forrest (1980) 23 SASR 364 in support of the contrary view. It points to Sloggett as distinguishable because (unlike in Leydon) the absence of a reasonable excuse was not an element of the relevant offence. The FWO submits that there is no reason for a construction that allows an employer to neglect their obligation to rectify their contraventions with impunity after a reasonable excuse has ceased to exist, where the passing of the time fixed in the notice does not eliminate unpaid minimum entitlements.

A review of the authorities

81    Brammer, upon which the primary judge relied, concerned whether a summons alleging a failure to pay amounts allegedly due under an award, had been filed within the time (12 months) prescribed for proceedings of that nature by s 119 of the Conciliation and Arbitration Act 1904 (Cth). The summons had been filed more than 12 months after the amounts first allegedly became payable. Justice Joske, with whom Spicer CJ and Smithers J agreed, referred to a number of previous authorities including Lorne Saw Mills to the effect that a breach of an award consisting of a failure to pay the amounts prescribed by the award was a continuing breach that could be the subject of proceedings so long as the money remained unpaid. One authority cited (at 278-9) was R v Industrial Appeals Court; Ex parte Barelli’s Bakeries Pty Ltd [1965] VR 615, in which Smith J said:

I consider that the Industrial Appeals Court was right in regarding the offence charged as a continuing one, and in holding that the information was, therefore, laid within time. The offence charged was not that the employer allowed the time fixed for payment to pass without having paid. It was that, moneys having become due and payable, the employer failed to perform the duty imposed by the Act of paying them to the employee. That duty is one which operates throughout the period from the time fixed for payment until actual payment. The breach of it begins at the time fixed for payment but continues on. … The distinction is between, on the one hand, an offence which, once committed, is complete and concluded and exists only in the past, and, on the other hand, an offence constituted by a continuing breach of a duty to take action to put an end to a forbidden state of affairs, in this case that wages which have become payable under a determination are unpaid. …

82    In Sloggett, a Full Court of the NSW Supreme Court held that the offence of failing to comply with the requirements of a notice issued under s 473 of the Local Government Act 1919 (NSW) to eradicate noxious plants within a specified time was “complete and concluded” if the person to whom it was issued had not effected the required eradication by the specified time. The test to determine whether an offence was continuous was whether its gravamen was found in something that the offender can, at will, discontinue. In that case, the offence under s 473 was a failure to comply with the requirements of the notice, not a failure to eradicate generally. Accordingly, if the plants were not eradicated within the time specified in the notice, then the offence was complete and could not be remedied in the future: Sloggett at 208 (Street CJ, with whom Owen and Clancy JJ agreed).

83    In Leydon, a secretary of a company had failed to submit the prescribed statement to the liquidator of the company within 14 days of a winding up order, contrary to s 234 of the Companies Act 1962 (SA). The Full Court of the Supreme Court of South Australia held by majority that s 234 imposed a continuing offence. Chief Justice King reasoned as follows:

(a)    On its face, s 234 imposed an offence of failing to comply with the requirements of that section. That offence was committed at the first non-compliance without reasonable excuse and continues so long as the non-compliance without reasonable excuse continues. By contrast, in Sloggett the offence was non-compliance with a notice: Leydon at 372.

(b)    The result in Sloggett might not be the same if the statute made absence of excuse an element of the offence: a reasonable excuse that was available for the period of the notice would not necessarily provide a defence to a charge of non-compliance with the notice on a later date to which the excuse did not apply: Leydon at 372.

(c)    The question of whether non-compliance with a legal duty which must be performed within a prescribed time is a continuing offence is determined by reference to the text and context of the provision. In general, “it is to be expected that a failure to do some act which the person is required by law to do will be a continuing offence”, and the offence of non-compliance with a continuing statutory duty will continue so long as non-compliance continues: Leydon at 375. The offence created by s 234 was an offence which continued so long as the non-compliance without reasonable excuse continued: Leydon at 376.

84    WCLS correctly observes that these statements were obiter dicta, because King CJ ultimately concluded that the particular charge laid in that case related to the day following the expiration of the 14 days: Leydon at 377. However, what is relevant to this case is his Honour’s statement of principle, not the particular conclusions he reached on the facts of Leydon.

85    Joseph considered s 72 of the Long Service Leave Act 1992 (Vic), which required an employer to pay an employee’s long service leave entitlement “on that day”, meaning the day that employment ended and the leave entitlement accrued. The Victorian Court of Appeal held that this obligation to pay an entitlement “on that day” was not a continuing offence: other provisions of the Act created a continuing obligation on an employer to pay long service leave entitlements, but s 72 provided for “a specific offence by reference to a specific or stipulated date for payment”: Joseph at [86]. Relevantly, Osborn JA (with Tate and Niall JJA agreeing) held that the cases can be divided between those which characterise the relevant provision as one concerned with “non-observance” or as one concerned with a specific requirement to meet a statutory time limit: Joseph at [50]. Lorne Saw Mills and Brammer were in the former category, while Sloggett was in the latter: see Joseph at [46]-[48] (Lorne Saw Mills), [52]-[55] (Sloggett), [66]-[68] (Brammer). His Honour did not discuss Leydon, other than referring to it when stating that the terms of the statute are the first source from which the nature of an offence is ascertained: Joseph at [63] (footnote 36). Nor did Joseph consider the position where reasonable excuse was an offence element or an available defence.

86    Two cases have applied Leydon to conclude that an offence of failing to provide information within a specified time, without a reasonable excuse, is a continuing offence.

87    Ganke v Corporate Affairs Commission (1990) 19 NSWLR 449 concerned s 375(9) of the Companies (New South Wales) Code which made it an offence, without reasonable excuse, to fail to comply with a provision in that section. That included a requirement to provide the liquidator with prescribed information (s 375(1)), and a requirement to provide the liquidator with a report containing such information about the affairs of the company, and at a date, as specified in a liquidator’s notice (s 375(2)). Justice Hunt (with whom Enderby and Sharpe JJ agreed) held that the offence in s 375(9) created a continuing obligation because of the effect of s 571 of the Companies Code: Ganke at 452-453. However, his Honour held further that, “[e]ven without reference to s 571”, the offence created by s 375(9) should be construed as a continuing one. That is because the liquidator still requires the information referred to in s 375(1) after the specified period has expired, so to interpret the offence as “once and for all” would deprive s 375(1) of any real operation. His Honour held, relying on Leydon, that the offence in s 375(9) continues for as long as the director fails without reasonable excuse to submit the report: Ganke at 453.

88    In Hopfner v Flavel (1990) 48 A Crim R 149, the appellant was charged with failing to comply with a direction from a liquidator, contrary to ss 12 and 14 of the Companies (South Australia) Code. Section 12(2)(a)(ii) provided that a person authorised by the Corporate Affairs Commission could give a direction in writing to a person connected with a corporation requiring the production of books relating to the affairs of the corporation “at such time and place as are specified in the direction”. Section 14(1) provided that it was an offence to refuse or fail to comply with a s 12 direction without reasonable excuse. Justice Mullighan held that, having regard to the purpose of s 12 and to the circumstances in which the failure to comply with a s 12 direction constitutes an offence, the failure to comply with a s 12 direction is a continuing offence, which continues for so long as a reasonable excuse does not exist. His Honour adopted the reasoning in Leydon at 375: see Hopfner at 154-155.

89    Two further cases have commented on the relationship between Sloggett and Leydon.

90    In Environment Protection Authority v Alkem Drums Pty Ltd (2000) 121 A Crim R 152; [2000] NSWCCA 416, the NSW Court of Criminal Appeal held that the offence created by cl 21(3) of the Clean Waters Regulations 1972 (NSW) did not create a continuing offence. By cl 21(1), the Commission could in specified circumstances, by notice in writing, require the occupier of premises to undertake measures to control or prevent the discharge or likely discharge of pollutants “within such time and in such manner as may be specified in the notice”. By cl 21(3), an occupier of premises who did not comply with a requirement of a notice was guilty of an offence. Clause 21 did not provide for a defence of reasonable excuse.

91    The majority (Foster AJA, with Dunford J agreeing) held that Sloggett and Ex parte Schaefer; Re Field (1943) 60 WN (NSW) 99 prevented s 21(3) from being interpreted as creating a continuing offence. Foster AJA held that these decisions were “sound both in policy and logic”: Alkem Drums at [8], [11]. His Honour stated that cases such as Leydon and Ganke depended on their own facts and the nature of the legislative provisions involved: Alkem Drums at [12].

92    The other member of the Court, Smart AJ, agreed that the particular offence charged was not a continuing offence, but indicated a preferred approach that offences charged under cl 21 of the Clean Waters Regulations could at least sometimes be continuing offences. Smart AJ stated that if cl 21 could never create a continuing offence, that would show that the notice procedure was conspicuously defective in enforcing the statutory objectives: Alkem Drums at [52]-[53], adopting Penton Park Homes Ltd v Chertsey Urban District Council (1973) 72 LGR 115 at 120. His Honour noted that cases have held that a failure to pay wages within the prescribed time is a continuing offence, which could be explained on the basis that it would be an “extraordinary result” if this were not an offence which continued until payment: Alkem Drums at [55]. The trial judge in Alkem Drums had held that Leydon and Ganke were distinguishable, because in those cases the relevant obligation was imposed directly by statute, not by notice: see Alkem Drums at [65]. However, Smart AJ did not approve that distinction, stating that (subject to the Act or a notice being unambiguous) the distinction between a failure to comply with a notice within the stipulated time and failure to comply with a statute within a stipulated time should not lead to a different result, when the harm to be avoided continues after the stipulated time: see Alkem Drums at [73].

93    In Hunter v City of Joondalup (2015) 257 A Crim R 299; [2015] WASC 444, Corboy J held that, standing alone, s 3.25(6) of the Local Government Act 1995 (WA) did not create a continuing offence for a failure to comply with a notice issued under s 3.25(1), but that s 71 of the Interpretation Act 1984 (WA) had the effect of creating a continuing offence from any ongoing non-compliance with a s 3.25(1) notice: Hunter at [71]-[72]. Section 3.25 did not contain a defence of reasonable or lawful excuse. Relevantly to this case, Corboy J made the following comments about Sloggett and Leydon:

(a)    The general rule laid down by cases such as Sloggett is that, when a time for compliance with a statutory requirement is fixed, the offence of non-compliance is complete at the end of that time and the offence is not a continuing one: Hunter at [39]-[40], quoting Welsh v Cornfoot [1973] VR 21 at 26 (Lush J).

(b)    However, there were statements “that might be thought as tending the other way” and quoted from Leydon: Hunter at [40]-[43]. Justice Corboy stated that the conclusions he reached in Hunter (which depended on a State interpretation provision) were consistent with the reasoning in Leydon (followed in Hopfner): Hunter at [44].

94    None of the cases set out above is binding on this Court, so the issue must be resolved at the level of principle. Even so, three points can be drawn from the cases discussed above.

95    First, the paramount principle is that the question of whether a statutory offence or civil remedy provision can give rise to a continuing contravention turns on both the text and subject-matter of the relevant Act. We agree with Smart AJ in Alkem Drums at [68] (albeit in dissent) that “[m]uch, if not all, depends on the terms of the statute and the regulation but the terms of the notice may also be important in a particular case”. As explained below, in this case the legislative context is decisive.

96    Second, there is no necessary inconsistency between Sloggett and Leydon as a matter of authority: Leydon distinguished Sloggett, and the majority in Alkem Drums distinguished Leydon (and Ganke) in turn. The attempt by the trial judge in Alkem Drums to distinguish Leydon on the basis of a distinction between an obligation imposed by a notice and by a statute was expressly disapproved by Smart AJ, and the majority distinguished Leydon on a different basis. Joseph did not discuss Leydon (or the position when there is a reasonable excuse), and Hunter stated that Leydon and Hopfner tended against Sloggett, without suggesting that those decisions were incorrect. Therefore, contrary to WCLS’s argument, it cannot be said simply that Sloggett is right, and Leydon is wrong.

97    Third, the reasoning in Leydon at 375 (as followed in Ganke and Hopfner) provides strong support for the conclusion reached by the primary judge, because s 716 of the FW Act (like the provisions in Ganke and Hopfner) contains a defence of reasonable excuse, as we discuss further below.

Legislative context of s 716(5) demonstrates that it establishes a continuing obligation for compliance

98    The reasoning in Joseph at [50] provides some support for WCLS’s argument that the characterisation of whether s 716(5) imposes a continuing obligation for compliance is not simply a matter of applying Brammer and Lorne Saw Mills (cf LJ at [143]). The offences considered in Brammer and Lorne Saw Mills did not fix a specific time for compliance but rather imposed an offence for non-observance of an award. By contrast, contravention of s 716(5) involves failing to comply with a notice given under s 716(2), which notice requires specified actions to be taken within the time specified in the notice (which must be reasonable). The distinction set out in Joseph at [50] might therefore suggest that s 716(5) is a civil remedy provision concerned with a specific requirement to meet a statutory time limit.

99    However, the legislative context of s 716(5) of the FW Act demonstrates that it establishes a continuing obligation to comply with a s 716(2) notice and therefore may give rise to a continuing contravention. It is first necessary to identify the underlying purpose of the notice scheme established by s 716, which is to provide a mechanism for the enforcement of the NES, modern awards and the other categories of industrial instruments specified in s 716(1). This mechanism operates as an alternative option to the initiation of court proceedings under Pt 4-1 of the FW Act: see the Explanatory Memorandum at [2673]. It is one means by which the FW Act gives effect to that part of the object of the FW Act in s 3(b) which refers to “ensuring a guaranteed safety net of fair, relevant and enforceable minimum terms and conditions through the National Employment Standards, modern awards and national minimum wage orders” (emphasis added). The purpose which s 716 serves, namely achieving compliance with the NES, modern awards and other industrial instruments, is not time-limited but is an ongoing one. Thus, although s 716(5) is a provision which is different in character than those considered in Brammer, Lorne Saw Mills and Barelli’s Bakeries, its underlying purpose is the same, namely “to put an end to a forbidden state of affairs” (Barelli’s Bakeries at 623) and to achieve compliance with the guaranteed safety net. By analogy with the reasoning of Hunt J in Ganke, that purpose endures after the time period specified in a notice issued under s 716(2) if the notice has not been complied with, and to construe s 716(5) as establishing only a time-limited obligation would substantially vitiate the effectiveness of the enforcement mechanism established by s 716. As earlier discussed, it has been long held that an offence of failing to pay wages within a prescribed time is a continuing one, on the basis that it would be an “extraordinary result” if this were not an offence which continued until payment: Alkem Drums at [55] (Smart AJ). Against that background, it is more likely that Parliament intended that the compliance notice procedure in s 716 provide an effective alternative means for (relevantly) the recovery of wages, rather than one that was “conspicuously defective” in achieving that purpose: see Alkem Drums at [52]-[53].

100    A number of features of the scheme in ss 716 and 717 provide more immediate contextual support for this conclusion. First, s 716(6) makes available a defence of reasonable excuse. As discussed above, the reasoning in Leydon, Ganke and Hopfner supports treating s 716(5) as creating a continuing contravention on that basis (noting that, as WCLS conceded, there is no material difference for this purpose between reasonable excuse being an element of the offence or contravention and it being a defence). The different reasoning in Sloggett, the majority in Alkem Drums, Hunter and Joseph is distinguishable because the offences at issue in those cases did not contain a reasonable excuse defence (the distinguishing feature mentioned by King CJ in Leydon at 372). To paraphrase what was stated by King CJ in Leydon at 376, there is no apparent rationale to construe s 716(5) in a way which would allow a person who had a reasonable excuse for failing to take the actions specified in a notice within the identified time period to neglect to take those actions after the excuse had ceased.

101    Second, s 716(4A) prohibits a Fair Work Inspector from initiating enforcement proceedings under Div 2 of Pt 4-1 for contravention of a civil remedy provision by a person when a notice relating to that contravention has been given to the person in two specified circumstances. The first, in subparagraph (b)(i), is that the notice has not been withdrawn and the person has complied with the notice. By this means, a person who complies with a notice is protected from subsequent court proceedings — a protection which operates to enhance the efficacy of the notice scheme and the likelihood of compliance. The condition that the notice must not have been withdrawn is not given any temporal limitation, so that the protection will not apply even if the notice is withdrawn at some time after the period specified in the notice for compliance. This implies that, likewise, compliance may occur after the end of the period specified in the notice — that is, compliance at any time while the notice is on foot, having not been withdrawn, is sufficient to attract the protection from litigation afforded by s 716(4A). This is consistent with s 716(5) establishing a continuing contravention.

102    The second circumstance, in s 716(4A)(b)(ii), is that an application has been made for a review of the notice under s 717 and has not been completely dealt with. There is no requirement for such an application to be made prior to the time period specified in the notice. That a review application, whenever made, also attracts the protection from litigation is significant having regard to s 717(3), as we discuss further below.

103    Third, s 716 must be read together with the procedure in s 717 for seeking review of a compliance notice. Section 717(2) provides that, after an application for review is made, “the court may stay the operation of the notice on the terms and conditions that the court considers appropriate”. This power to stay the notice presupposes that the notice gives rise to a continuing obligation; if the obligation ended on the date specified in the notice, there would for all practical purposes be nothing to stay, especially because, as already stated, the right of review does not require that review proceedings be commenced before the time specified in the notice expires. This understanding is confirmed by the Explanatory Memorandum, which states:

2685.     Subclause 717(2) provides that a court may stay the operation of a notice on the terms and conditions that the court considers appropriate. For example, a court could make an interim order staying the operation of the notice while it decides whether to confirm, cancel or vary the notice. In the absence of such an order, a person to whom a compliance notice is directed would be required to comply with it.

(Emphasis added)

104    Additionally, the conferral upon relevant courts of an express power to “confirm” and “vary”, as well as to “cancel”, a notice under s 717(3) implies a continuing obligation, and opportunity, to comply with a notice. These powers would have little or no purpose or effect unless this is the case. For example, there would be no apparent purpose of a court varying a notice unless there remained an obligation to comply with the notice, as varied, and the person the subject of the obligation retained the capacity to comply with it. This understanding of s 717(3) is consistent with the protection afforded under s 716(4A)(b)(ii): a person served with a notice under s 716(2) is given the right to apply for court review of the notice on the grounds specified in s 717(1) and, if they do so, they are protected from enforcement litigation under Pt 4-1 while the review application is on foot. If the application does not wholly succeed but rather the court confirms or varies the notice, the person remains obliged to comply with the notice and, if they then do so, that attracts the protection afforded under s 716(4A)(b)(i) (as well as that under s 716(4B)). Thus, construing s 716(5) as involving a continuing obligation to comply, and a continuing contravention in the event of non-compliance, is consistent with giving the review mechanism in s 717 full efficacy.

105    For these reasons, the primary judge was correct to find that s 716(5) of the FW Act creates a continuing offence. Appeal ground 6 is rejected.

Ground 5

106    Our conclusion as to ground 6 makes it unnecessary for us to determine ground 5 for the reason earlier stated at [78]. However, we observe that the primary judge’s reasons in the amendment ruling would appear to take an entirely orthodox approach to the issue.

Conclusion

107    For the foregoing reasons, the appeal is dismissed.

Associate:

Dated:    7 May 2026