Federal Court of Australia

Basi v Namitha Nakul Pty Ltd [2022] FCA 712

ORDERS

THE COURT ORDERS THAT:

1.    The parties provide agreed draft declarations and orders to give effect to the reasons for judgment delivered today and, in default of agreement, each party file and serve draft declarations and orders it proposes to be made, on or before 19 July 2022.

2.    The applicant file and serve written submissions as to penalty (limited to 5 pages) and any affidavit evidence on or before 12 July 2022.

3.    The respondents file and serve written submissions as to penalty (limited to 5 pages) and any affidavit evidence on or before 19 July 2022.

4.    The proceeding be listed for a case management hearing at 9.30 am on Tuesday, 26 July 2022.

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

ORDERS

THE COURT ORDERS THAT:

1.    The parties provide agreed draft declarations and orders to give effect to the reasons for judgment delivered today and, in default of agreement, each party file and serve draft declarations and orders it proposes to be made, on or before 19 July 2022.

2.    The applicant file and serve written submissions as to penalty (limited to 5 pages) and any affidavit evidence on or before 12 July 2022.

3.    The respondents file and serve written submissions as to penalty (limited to 5 pages) and any affidavit evidence on or before 19 July 2022.

4.    The proceeding be listed for a case management hearing at 9.30 am on Tuesday, 26 July 2022.

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

Table of Contents

REASONS FOR JUDGMENT

HALLEY J:

Introduction

1    In related proceedings that were heard together, the applicants, Mr Midhun Basi (Mr Basi) (in NSD523/2019) and Mr Syed Haider (Mr Haider) (in NSD730/2019) allege that their former employer, the first respondent Namitha Nakul Pty Ltd (Namitha Nakul), contravened the Fair Work Act 2009 (Cth) (FW Act) in multiple respects and that the sole director of Namitha Nakul, the second respondent, Mr Vaisakh Mohanan Usha (Mr Usha), was involved in those contraventions and further personally contravened the FW Act.

2    On the third day of the hearing, 15 September 2021, the proceedings against Ms Priyadevi Sunil Kumar (Ms Kumar) (the third respondent in NSD523/2019) and Mr Sujith Ayyappadas Sulatha (Mr Sulatha) (the fourth respondent in NSD523/2019 and the third respondent in NSD730/2019) were discontinued.

3    The proceedings raise for determination the all too familiar difficulties of applying the provisions of industrial statutes and awards to family run businesses that fail to keep accurate and complete employment records of their staff. Difficulties that are exacerbated, as was the case here, where employees have been granted or are seeking sponsorship for visas permitting them to work in this country. Regrettably, in order to accommodate these difficulties, much of the testimonial evidence given by witnesses had to be carefully scrutinised, contemporaneous employment records given little weight and ultimately the apparent logic of events and facts capable of being objectively established were given greater weight than usual in making factual findings.

4    Namitha Nakul operated two Indian restaurants, the “Adithya Kerala” restaurant at 166 Keira St Wollongong, NSW (Wollongong Restaurant) and the “Adithya Kerala” restaurant at 78 Junction St Nowra, NSW (Nowra Restaurant).

5    The applicants contend that throughout their employment as cooks by Namitha Nakul at the Wollongong Restaurant and the Nowra Restaurant (together, Restaurants) they were required to work excessive hours without any formal breaks, they were not paid their award entitlements, and they were unlawfully required to pay a significant proportion of their wages back to the respondents as either repayments of alleged loans made to them by Mr Usha or to cover Pay as You Go (PAYG) tax liabilities on their wages and visa application costs.

6    The respondents contend that the applicants have overstated the hours that they worked for Namitha Nakul but were nevertheless always paid the wages stipulated in their employment agreements, at least in the case of Mr Basi. They contend that the applicants never accrued any entitlement to overtime and notwithstanding the terms of their employment agreements and alleged experience, the applicants worked more as kitchen hands than cooks. The respondents further contend that the cash amounts that the applicants paid back to them from their wages were agreed repayments of loans that Mr Usha had made to them. The respondents deny that they ever requested or accepted payments from the applicants to meet PAYG tax liabilities or visa application costs.

7    Mr Basi and Mr Haider seek: declarations that Namitha Nakul committed contraventions and/or serious contraventions of the FW Act; declarations that Mr Usha was involved in those contraventions and/or committed contraventions and serious contraventions of the FW Act; the imposition of penalties on the respondents and orders that those penalties be paid; and an order that the respondents pay compensation. In addition, Mr Haider seeks an order that the respondents pay him an amount on a quantum meruit basis for work performed by him between July 2016 and 31 October 2016.

Admitted contraventions of the FW Act

8    The respondents have admitted the following contraventions of the FW Act, with respect to the Restaurant Industry Award 2010 (Award) and the National Employment Standards (NES), which they submit were admitted at the earliest possible opportunity:

(a)    Section 45 (being a breach of clause 5 of the Award): failure to display the Award and NES at the Restaurants;

(b)    Sections 44 and 90(2) (being contraventions of the NES): failure to pay the applicants for their untaken annual leave at the end of their employment;

(c)    Section 45 (being a breach of cl 35.2(b) of the Award): failure to pay the applicants additional leave loading of 17.5%;

(d)    Section 45 (being a breach of cl 30.2(a) of the Award): failure to pay Mr Haider superannuation contributions;

(e)    Section 323 (in relation to method and frequency of payment), limited to the payment of entitlements regarding annual leave and leave loading; and

(f)    Sections 44 and 117 (being a breach of the NES): failure to give Mr Haider notice or payment in lieu thereof on his termination.

Contested claims advanced by the applicants

9    The specific claims that the applicants make against the respondents that are contested can be summarised as follows.

10    First, Mr Basi and Mr Haider allege that over the course of their employment with Namitha Nakul they were required to work for at least 12 hours per day, six days per week without being afforded breaks, contrary to the provisions of the Award.

11    Second, Mr Basi and Mr Haider allege that they were not paid the amounts due and owing to them, contrary to the Award.

12    Third, Mr Basi alleges that during much of his employment, Mr Usha demanded that he make cash payments of approximately $511 per fortnight, and that if he did not do so the business would close and he would not have a job.

13    Fourth, Mr Basi alleges that between May and August 2017, Mr Usha demanded he pay an amount in excess of $6000 in respect of Namitha Nakul’s PAYG income tax liability for him, and that if he failed do so it would affect Mr Basi’s migration status.

14    Fifth, Mr Basi also alleges that in December 2017 and January 2018 Mr Usha demanded that he pay $1710 in respect of Namitha Nakul’s PAYG income tax liability for him, and that if he failed to do so Mr Usha would shut the restaurant and Mr Basi would be “in trouble”.

15    Sixth, Mr Haider alleges that Mr Usha demanded he pay $1400 in respect of Namitha Nakul’s sponsorship of Mr Haider’s Temporary Work (Skilled) (subclass 457) visa, which Mr Haider paid one week later.

16    Seventh, Mr Haider alleges that he is entitled to make a quantum meruit claim for the work he performed at the behest of Namitha Nakul and Mr Usha to prepare the Nowra Restaurant for trading between July and October 2016.

Principal conclusions

17    For the reasons that follow, I have concluded that:

(a)    Mr Basi was employed full time by Namitha Nakul between 19 July 2016 and 27 August 2018 at the Restaurants at a classification of Cook Grade 4 at the Wollongong Restaurant and subsequently as a Cook Grade 5 at the Nowra Restaurant;

(b)    Mr Haider was employed for an average of 30 hours a week by Namitha Nakul in the period between 10 July 2016 and 30 October 2016, and then in the period between 31 October 2016 and 14 August 2018 he was employed full time by Namitha Nakul at a classification somewhere between Cook Grade 3 and Cook Grade 4, but ultimately closer to Cook Grade 4, at the Restaurants;

(c)    the applicants did not work 12 hour days for six days a week for Namitha Nakul;

(d)    it was not possible to conclude on the balance of probabilities that the applicants had worked overtime hours or had worked for more than five hours on any given day without a break, notwithstanding, to the extent relevant, the operation of s 557C of the FW Act;

(e)    the respondents failed to arrange the hours of work of the applicants in a manner consistent with the Award and failed to pay weekend holiday rates in contravention of clause 34.1 of the Award, and therefore s 45 of the FW Act, this failure amounted to a serious contravention for the purposes of s 557A of the FW Act, and Mr Usha was knowingly involved in that serious contravention;

(f)    Namitha Nakul failed to pay the amounts due and payable to the applicants under the Award in contravention of clause 20 of the Award, and therefore s 45 of the FW Act, this failure amounted to a serious contravention for the purposes of s 557A of the FW Act, and Mr Usha was knowingly involved in that serious contravention;

(g)    Mr Usha did not make any loans to Mr Basi or Mr Haider;

(h)    Namitha Nakul through Mr Usha demanded that Mr Basi make payments back to Namitha Nakul from his wages of approximately $511 each fortnight by way of cashback payments in contravention of ss 323 and 325 of the FW Act, this demand amounted to a serious contravention by Namitha Nakul for the purposes of s 557A of the FW Act, and Mr Usha was knowingly involved in that serious contravention;

(i)    Mr Usha made demands to Mr Basi for payment of money to cover Namitha Nakul’s PAYG liability for Mr Basi in contravention of ss 325, 343 and 345 of the FW Act, and that, by reason of s 793(1) of the FW Act, Namitha Nakul also made those contraventions;

(j)    Mr Usha made demands to Mr Haider for payment of money to cover Namitha Nakul’s visa sponsorship costs in contravention of s 325 of the FW Act, and that, by reason of s 793(1) of the FW Act, Namitha Nakul also made those contraventions; and

(k)    Mr Haider is entitled to a quantum meruit payment from Namitha Nakul for the work that he undertook between 10 July 2016 and 30 October 2016 to prepare the Nowra Restaurant for trading.

The Parties and Witnesses

Overview

18    Before commenting on each of the witnesses who gave evidence in the proceedings, it is necessary for me to make some general observations about the weight that I have been able to give to that evidence.

19    First, the hearing was conducted exclusively over Microsoft Teams. English was not the first language of any of the witnesses and the assistance of an interpreter was required for some witnesses. In considering the weight I have been able to give to the evidence of each witness, I have taken these matters into account. I have also had regard to the difficulties faced by the cross examiners seeking to test the evidence of witnesses in the proceedings because of language difficulties experienced by witnesses having to comprehend and respond to questions put to them, questions that were often framed in language familiar to cross examiners but not to lay witnesses, particularly the use of propositions expressed in the negative.

20    Second, I am satisfied that the evidence advanced by the applicants and the respondents concerning the employment agreements that the respondents provided to the Department of Immigration and Border Protection (Department) was inherently implausible and could not be accepted. It exposed both Mr Usha and Mr Basi, and to a lesser extent, Mr Haider to contraventions of the Migration Act 1958 (Cth) (Migration Act) and related legislation and regulations, and as a result I provided each of them with certificates pursuant to s 128 of the Evidence Act 1995 (Cth) with respect to that evidence.

21    Third, a necessary consequence of the second observation made above, was that self-serving and conflicting testimonial recollections of the witnesses on several critical matters had to be assessed against the apparent logic of events and the facts capable of being objectively established, in particular, entries recorded in bank statements, rather than contemporaneous employment records that might otherwise have been assumed to be an accurate account of the matters that they purport to record.

22    Fourth, none of the witnesses who gave evidence in the proceedings were independent, in that each was a party or a close family relation of Mr Usha or, in the case of Ms Kumar, had been living with Mr Usha’s family for many years. I am satisfied that this lack of independence led each witness to overstate aspects of their evidence by generalising from at times imperfect recollections of specific events to provide generalised evidence consistent with the respective cases sought to be advanced by the applicants and the respondents. This phenomenon was particularly prevalent in the evidence directed at the hours worked by the applicants, the specific cooking responsibilities and skills of the applicants and the extent of the cooking undertaken at the Nowra Restaurant. Again, I have been guided by the apparent logic of events and the facts capable of being objectively established in making findings of fact, rather than this generalised evidence of practices and experiences given by the witnesses in the course of the hearing.

Mr Midhun Basi

23    Mr Basi is the applicant in proceedings NSD523/2019 (Basi proceedings).

24    He is an Indian citizen. He was born on 21 October 1987. His first language is Malayalam, an Indian regional language spoken in the state of Kerala, India.

25    Mr Basi has a Bachelor’s Degree in Hotel Management from Calicut University in Kerala and a Master’s in Business Management from Victoria College, Nottingham in the United Kingdom. Both courses were taught in English.

26    In March 2015 he passed the International English Language Testing System General Training course.

27    Prior to his arrival in Australia in 2016, Mr Basi was employed as:

(a)    a cook for Emirates in-flight catering service in Dubai from August 2009 to January 2011, in which he cooked meals in a range of Indian cuisines;

(b)    a third chef in an Indian restaurant serving Keralan cuisine in Nottingham in 2012 while undertaking his Master’s Degree, in which he prepared and plated meals and carried out stock takes;

(c)    a cook preparing and storing Indian food for the Casino Flight catering company in Kerala from July to December 2013; and

(d)    a head chef in an Indian restaurant in Port Moresby, Papua New Guinea, from May 2014 to January 2015, in which his duties included preparing and plating meals, managing and ordering stock and supervising another cook.

28    On 7 July 2015 Mr Basi was issued with a Certificate III in Commercial Cookery by VETASSESS. VETASSESS is an organisation in Australia that conducts skills assessments for migration applications.

29    On 13 April 2016, Mr Basi was granted a Temporary Work (Skilled) (subclass 457) visa by the Department. Mr Basi’s sponsor was Chellappas Pty Ltd (Chellappas), a company that operated a restaurant and food court in Gosnells, near Perth in Western Australia, and a restaurant in Albany. Shortly after Mr Basi arrived in Australia and commenced working for Chellappas, he was advised by Chellappas that given the financial difficulties that Chellappas was encountering with their Albany restaurant, he should look for a new sponsor for his subclass 457 visa.

30    Mr Basi searched on Gumtree and located a classified advertisement for a position as an Indian cook in Wollongong.

31    In or about June 2016, Mr Basi had a three day trial at the Wollongong Restaurant with Mr Usha.

32    In or about July 2016, following the three day trial, Mr Usha made a written offer of full-time employment to Mr Basi dated 19 July 2016 (Basi Employment Offer).

33    The Basi Employment Offer provided that:

Namitha Nakul Pty Ltd Trading as Adithya Kerala Restaurant agrees to employ you in the full time position of Cook with our business, subject to the successful outcome of your 457 Nomination transfer to our Company.

Your base salary, based on a 40 hour week will be $55,000.

Your hourly rate is $26.44 per hour for a 40 hour week.

Your employment terms and conditions are covered by the Hospitality Industry (General) Award 2010. Your rate of pay is Market Rate.

The position is permanent, full time and for 4 years.

34    On 15 November 2016, the Department approved Mr Basi’s nomination by Namitha Nakul as a cook for the purpose of his subclass 457 visa.

35    Mr Basi prepared two statements filed on 20 April 2020 and 5 March 2021 that were tendered in the proceedings. In his statements he describes his employment by Namitha Nakul at the Wollongong Restaurant and subsequently the Nowra Restaurant and the various payments that he received and made to Namitha Nakul and Mr Usha. He was extensively cross examined.

36    Mr Basi presented as a cautious witness who listened carefully to the questions that he was asked and he appeared to answer most questions directly and honestly. At various times during his cross-examination Mr Basi showed some hesitation and delay in answering questions, particularly when being pressed as to the timing of his work in the Wollongong Restaurant with Ms Kumar. I am satisfied that the delays with respect to this issue could principally be attributed to genuine confusion arising in the course of a focused and directed cross-examination seeking to lock Mr Basi into supporting the proposition that Mr Basi did not undertake any work at the Wollongong Restaurant prior to the Department’s approval of Namitha Nakul’s sponsorship of Mr Basi on 15 November 2016.

37    Having said that, there were significant aspects of his evidence that could not be accepted; in particular, his claims that he and Mr Haider worked 12 hour days, six days a week, other than on specific and rare occasions, and the extent to which he sought to downplay to what degree food served at the Nowra Restaurant had been initially prepared at the Wollongong Restaurant by Ms Kumar.

38    Nor can I accept Mr Basi’s evidence that he thought that in the period between the employment offer that was made to him on or about 19 July 2016 and the approval of the transfer of his 457 sponsorship to Namitha Nakul on 16 November 2017 that he was being employed pursuant to the terms of the employment agreement. The employment agreement was expressly stated to be subject to the approval of the Department and it provided for a salary to be paid that was equivalent to an after tax $855 per week, not the $600 per week that Mr Basi was receiving in cash during the period between July and November 2016.

39    Ultimately, I have approached Mr Basi’s evidence with some caution and I have generally only accepted it on matters in dispute to the extent that I am satisfied by reference to all the objective circumstances that it is plausible or it is otherwise corroborated by evidence of witnesses other than Mr Haider.

Mr Syed Haider

40    Mr Haider is the applicant in the proceedings NSD730/2019 (Haider proceedings).

41    Mr Haider is a Pakistani citizen born on 8 December 1987. He was granted a Higher Education Sector (subclass 573) student visa on 13 January 2015 by the Department, and arrived in Australia on 2 February 2015.

42    Mr Haider gave evidence that he undertook an 18-week course “English for Tertiary Studies” at the University of Wollongong between February and June 2015, and that he enrolled in the Master of Professional Accounting course, commencing on or about 17 August 2015. He gave evidence that he deferred the course in November 2015.

43    With regard to his cooking experience, Mr Haider gave evidence that:

(a)    between 2009 and 2014 he worked as a tandoori chef at different restaurants in Karachi, Pakistan, in which he was responsible for tandoori cookery (the cooking of meat and bread in a clay oven heated by a charcoal fire) and occasionally supervising other cooks; and

(b)    in 2015 he worked as a cook at a restaurant, “Garam Masala” in Shellharbour, New South Wales, in which he undertook tandoori cooking, curry preparation and service.

44    On 12 December 2016, Mr Haider obtained a Certificate III trade qualification in Commercial Cookery from FMedge, a private training college in Sydney, in which his previous cooking experience was recognised as “prior learning”.

45    By letter dated 30 May 2017, Mr Haider received a formal offer of employment from Namitha Nakul (Haider Employment Offer).

46    The Haider Employment Offer was in substantially identical terms to the Basi Employment Offer and provided that:

Namitha Nakul Pty Ltd trading as Adithya Kerala Restaurant agrees to employ you in the full time position of Cook with our business, subject to the successful outcome of your 457 [sic] This Position is for a Cook at Adithya Kerala Nowra Restaurant located at Shop 1, Aroney Way, 78 Junction Street, Nowra 2541.

Your base salary, based on a 40 hour week will be $55,000.

Your hourly rate is $26.44 per hour for a 40 hour week.

Your employment terms and conditions are covered by the Hospitality Industry (General) Award 2010. Your rate of pay is Market Rate.

The position is permanent, full time and for 4 years.

47    On 5 June 2017, Mr Haider accepted the Haider Employment Offer.

48    On 28 August 2017, Mr Haider applied for a Temporary Work (skilled) (subclass 457) visa, and was granted a bridging visa. His subclass 573 visa expired on 28 September 2017.

49    On 19 October 2017, Mr Haider’s nomination for Namitha Nakul to be his sponsor for the subclass 457 visa was approved, but his application for the subclass 457 visa was refused by the Department on 16 August 2018. Mr Haider appealed that decision on 5 September 2018.

50    From July to October 2016, Mr Haider undertook work at the Nowra Premises to prepare the Nowra Restaurant for the commencement of trading at the end of October 2016. Mr Haider then worked for various periods at both Restaurants until he resigned from his employment with Namitha Nakul during a meeting he had with Mr Usha on a day in the period between 14 August 2018 and 4 September 2018.

51    Mr Haider generally presented as a confident and truthful witness who answered questions that he was asked succinctly and directly. Having said that, as with Mr Basi, there were significant aspects of his evidence that I ultimately could not accept, in particular his claims that he and Mr Basi worked 12 hour days, six days a week, other than on specific and rare occasions, and the extent to which he, in common with Mr Basi, sought to downplay the degree to which a substantial proportion of the food served at the Nowra Restaurant had been initially prepared at the Wollongong Restaurant by Ms Kumar.

Namitha Nakul Pty Ltd and Mr Vaisakh Mohanan Usha

52    Namitha Nakul is the first respondent in each proceeding.

53    Mr Usha is the director, secretary and sole shareholder of Namitha Nakul, and is responsible for the direction, management and control of the company.

54    Namitha Nakul operated the Wollongong Restaurant at all relevant times and the Nowra Restaurant from at least April 2017. The Wollongong Restaurant and the Nowra Restaurant were 35-seat and 40-seat restaurants, respectively, which served Keralan Indian cuisine for both takeaway and dine-in lunch and dinner.

55    Mr Usha affirmed two affidavits in the proceedings on 7 September 2020 and 28 September 2021, respectively.

56    Mr Usha was not an impressive witness. He frequently provided long winded, self-serving and argumentative responses in the course of his cross-examination. His responses typically had the effect of obfuscating, rather than illuminating, critical issues to be determined in the proceedings.

57    Much of his evidence, in particular his evidence about the alleged loans that he made to Mr Basi, his denials that Mr Basi was employed by Namitha Nakul prior to November 2016 and that Mr Haider worked for the respondents prior to April 2017, was implausible and reflected very poorly on his credit. When challenged in cross-examination about the alleged loan that he arranged for his brother to advance to Mr Basi, Mr Usha gave the following evidence:

Mr Usha, what I want to suggest is that anyone who has been approached for a loan on one day and the very same person comes back to them four days later for another loan, their response won’t be to put their brother on the hook for the money. They will be in a state of disbelief. You understand what I’m saying, don’t you?---Yes, but no – because I can tell one more thing, you know. I am the only one, you know, went to her sister home and, you know, met his – his marriage arrangement and everything. But no other, you know, the business owners do that. But in – I – I go from, you know, India. Our culture is like that, help each other, like, you know, that’s the reason, you know, I went to his home and, you know, arrange his marriage and everything. I – I treat like as a, you know, family member. That’s why I did, you know, a lot of, you know, things like this.

HIS HONOUR: Did you say you treat him like a family member?---Yes.

And he had only worked for you for eight weeks?---Means, you know, he said a lot of his, you know, the – the poor things in the India, you know, they don’t have money and those of – you know, the – because of the mankind, one side, you know, I can say. So every day he is – sometimes, you know, he is crying for, you know, they tell that stories and he is crying. So that’s, you know, feel – feel, you know, something mankind. That’s the reason why I help him. Because, you know, I already – what I am thinking is a four years visa, he already here, so he working for me, because there is plenty of time to repayment. You know, that’s all, you know, in my mind.

58    As concerning were Mr Usha’s explanations of why loans that he alleged he made personally to Mr Haider in January 2017 were recorded as salary payments on the notations that he made when he transferred the funds from Namitha Nakul’s bank account to Mr Haider, including the following exchanges:

MS DOUST: Sorry, Mr Usha. Now, do you see the entries on that page for 31 January and 7 February for – in Mr Haider’s bank account?---Yes.

You’ve described them as “Adithya salary”?---Yes.

“Vaisakh”?---Yes, yes.

That’s your words, isn’t it?---That’s to my word but, - - -

.....?--- - - - you know, that – sorry.

That’s the entry you’ve made when you transferred the money across to Mr Haider from the Namitha Nakul account?---Yes.

And - - -?---Sometimes – sorry.

HIS HONOUR: I don’t think he had finished the answer.

Had you finished your answer, Mr Usha?---No. The sometimes, you know, the – I transferred, normally, when he ask money. I transferred like that and, plus, you know, he tried to start work with me, you know, once I opened the Nowra. So what was the moneys, you know, after that I transfers I mentioned that’s salary. Because, you know, the future, you know, when I go to the tax agents I had to show them so, you know, the why these moneys goes. And at that times I can’t remember so this is already mentioned there so they can easily identify, “Okay, I gave this one in the salary. I can deduct in the future. So, you know, when I start in Nowra, so I can deduct that money there. So I gave advance and I mentioned there, always I am mentioning. So that’s the reasons I think I mentioned that.

and,

HIS HONOUR: So what were you paying him salary for? That is, what were you paying Mr Haider salary for in January of 2017?---That I mentioned in the – you know, the transfer. Because, you know, the tax agent can see that, you know, the why I used that money.

Yes, because you were paying him for work that he was doing for you?---Yes, I give money, but I said to the tax agent, “That’s money for, you know, the salary, we can deduct it, but it’s the loan.” So it’s paid from, you know, the company, so that’s the reason. We have to show the reason to the tax agent, you know, why we spent this money, why we spent – that’s the questions he will ask.

Sorry, this was your tax agent?---My tax agent. When I give, you know, the GST – company GST, three months, then we give the bank statement and he will ask, whenever he doubt, you know, the payment, doubt, “Where you spent this moneys,” and, “Where you, you know, transfer this money,” like that. You know, he will ask.

59    Moreover, Mr Usha’s manifest failure to comply with or otherwise appreciate his obligations under the Award and the FW Act, and his apparent willingness to provide instructions that were incorrect to migration agents in relation to visa sponsorship applications and tax agents in relation to the preparation of payslips, also reflected very poorly on his credit.

60    Equally concerning was the unchallenged evidence given by Mr Haider that in response to Mr Basi’s complaints, Mr Usha had requested Mr Haider to sign erroneous backdated worksheets and to sign a statement that contained incorrect representations. Mr Haider stated that on or about 10 August 2018, in the course of Mr Usha seeking to persuade him to sign the erroneous worksheets, Mr Usha told him at the Wollongong Restaurant:

You are the only witness in Midhun’s complaint you are not a family member so your statement matters a lot. My lawyer is asking you to write a statement. If you give me the statement, I can save you and you can save me. Because if immigration cancels my approval to be your sponsor you will be in trouble.

61    The statement that Mr Usha requested that Mr Haider sign contained representations that were internally inconsistent and, for the reasons I explain subsequently in these reasons, were erroneous, including that Mr Haider never worked on Tuesdays (contrary to other representations in the draft statement and the evidence of Mr Usha in the proceedings), the Nowra Restaurant was only ever open from 11.30 am until 5.00 pm from Wednesday to Sunday (rather than Tuesday to Sunday as accepted by all witnesses in the proceedings), and no work was done at the Nowra Restaurant between 3.00 pm and 5.00 pm (thus ignoring take away orders). The statement was both an attempt to discredit Mr Basi’s claims of the hours that he alleged he worked at the Nowra Restaurant and a relatively flagrant attempt to portray Mr Haider as only working 20 hours a week for four hours a day from Wednesday to Sunday, in order to avoid Mr Haider providing a statement that might provide evidence of potential contraventions of the FW Act and the Migration Act.

62    In short, I was not prepared to accept any evidence given by Mr Usha on any matter in dispute unless it was against interest or corroborated by the evidence of other witnesses or contemporaneous documents that had not been prepared by him or at his direction.

Ms Priyadevi Sunil Kumar

63    Before proceedings were discontinued against her, Ms Kumar was the third respondent in the Basi proceedings.

64    Ms Kumar affirmed an affidavit in the proceedings on 29 August 2020 in which she described her involvement in the Restaurants and her dealings with the applicants. She was cross examined.

65    Ms Kumar worked in the Wollongong Restaurant as the Head Chef from March 2017 and supervised the Wollongong Restaurant in Mr Usha’s absence.

66    Ms Kumar has lived with Mr Usha and his family in the same household since 2007. She jointly purchased property with Mr Usha, was party to and guaranteed the lease on the Wollongong Restaurant, provided $10,000 or $20,000 when the lease was entered into, and worked in the business.

67    In assessing the weight I was able to give to Ms Kumar’s evidence, I have taken into account the extent of her connections with Mr Usha. Nevertheless, I was satisfied that Ms Kumar was generally doing her best to tell the truth and not to act as an advocate for Mr Usha. Having said that, I am satisfied that her evidence concerning the limited hours worked by the applicants for Namitha Nakul, the absence of any cooking being undertaken at the Nowra Restaurant and the cooking skills of Mr Basi and Mr Haider was inconsistent with the apparent logic of events, in particular, the circumstances in which the applicants first came to be employed by Namitha Nakul, the extent of their cooking experience prior to working for Namitha Nakul and their day to day involvement in the kitchen at the Nowra Restaurant. I am satisfied that her evidence on these matters was overstated and given her location in the Wollongong Restaurant, she was not best placed to comment upon these matters.

Mr Sujith Ayyappadas Sulatha

68    Before proceedings were discontinued against him, Mr Sulatha was the fourth respondent in the Basi proceedings and the third respondent in the Haider proceedings.

69    Mr Sulatha affirmed an affidavit in the proceedings on 24 September 2020 in which he gave evidence of his involvement in the Nowra Restaurant and his dealings with the applicants. He was cross examined.

70    Mr Sulatha is Mr Usha’s brother-in-law. He was sponsored by Mr Usha to come to Australia on a subclass 457 visa as a skilled worker, despite having no prior experience as a restaurant manager. Mr Sulatha was dependent on Mr Usha to come to Australia. He accepted in cross-examination that he felt a sense of obligation to him due to his family relationship.

71    Mr Sulatha worked in a management role in the Nowra Restaurant, and was responsible for the management, direction and control of the Nowra Restaurant in the absence of Mr Usha and Ms Kumar. Mr Sulatha was employed by Namitha Nakul between September 2017 and December 2019.

72    Again, notwithstanding the extent of his relationship with Mr Usha, Mr Sulatha generally presented as an honest and truthful witness but his evidence as to the limited hours worked by the applicants for Namitha Nakul at the Nowra Restaurant, the absence of any cooking being undertaken at the Nowra Restaurant and the cooking skills of Mr Basi and Mr Haider was inconsistent with the apparent logic of events as explained above. I am satisfied that his evidence on these matters was overstated and I have discounted it in making findings on these matters.

Ms Sandhya Sujith Sulatha

73    Ms Sandhya Sujith Sulatha (Ms Sujith) affirmed an affidavit in these proceedings on 25 September 2020. She gave evidence about the extent to which food served at the Nowra Restaurant was pre-cooked at the Wollongong Restaurant and the responsibilities of the applicants while they were working at the Nowra Restaurant.

74    Ms Sujith is the wife of Mr Sulatha, and the sister of Mr Usha. Her first language is Malayalam.

75    On or about 9 September 2017 she immigrated to Australia with her husband and child.

76    Between September 2017 and January 2020 Ms Sujith and her family lived with Mr Usha and Ms Kumar and their respective families. She commenced working for Namitha Nakul in September 2017, initially for a short period in the Wollongong Restaurant and subsequently in the Nowra Restaurant.

77    Ms Sujith moved to Victoria in January 2020 and her husband, Mr Sulatha, joined her several weeks later in February 2020.

78    Ms Sujith generally presented as an honest and truthful witness. In common with Ms Kumar and Mr Sulatha, however, her evidence as to the limited amount of cooking being undertaken at the Nowra Restaurant and the cooking skills of Mr Basi and Mr Haider was again inconsistent with the apparent logic of events as explained above. I am satisfied that her evidence on these matters was overstated and I have discounted it in making findings on these matters.

Factual Background

Wollongong Restaurant

79    Namitha Nakul entered into a lease for Shop 4, the Wollongong Restaurant, on 22 January 2016. The lease commenced on 15 January 2016.

80    Between 15 January 2016 and 10 March 2016 the Wollongong Restaurant underwent minor renovations before opening officially as an a la carte restaurant serving South Indian cuisine on 11 March 2016. Namitha Nakul entered into a lease for Shop 2, the Wollongong Restaurant, on 15 October 2017.

81    The opening hours for the Wollongong Restaurant varied from time to time and were:

(a)    between March and April 2016: seven days a week from 10.00 am to 10.00 pm;

(b)    from April 2016 to July 2019: Tuesday through Sunday from 12.00 pm to 10.00 pm;

(c)    from July 2019 to January 2020: Tuesday through Sunday from 12.00 pm to 2.30 pm and from 5.00 pm to 9.30 pm; and

(d)    from January 2020 to March 2020: Tuesday through Sunday from 5.00 pm to 9.30 pm.

82    Between March 2016 and March 2017, Mr Usha was the head chef of the Wollongong Restaurant and had various cooking, supervising, cleaning and management duties.

83    Between March 2017 and March 2020, Ms Kumar was the head chef of the Wollongong Restaurant.

84    The head chef was usually assisted in the kitchen by other employees. The Wollongong Restaurant had two different shifts, a lunch shift from 12.00 pm to 2.30 pm and a dinner shift from 5.30 pm (or 6.00 pm) to 9.30 pm. During the lunch shift the Wollongong Restaurant also offered a lunch special with curries already prepared in warmers in the kitchen.

85    In August 2018, Namitha Nakul terminated its lease for Shop 2 of the Wollongong Restaurant after failing to comply with a final notice of demand from Colliers International dated 29 June 2018 for unpaid rent.

86    In March 2020, Namitha Nakul terminated its lease for Shop 4 and the Wollongong Restaurant was permanently closed.

Nowra Restaurant

87    On or about 20 September 2016, Namitha Nakul entered into a lease for the Nowra Restaurant at 1/78 Junction Street, Nowra. The lease commenced retrospectively on 24 August 2016. The Nowra Restaurant initially traded under the name “1980’s A Nostalgic Restaurant” and in the period between 31 October 2016 and March 2017 it was operated on a day to day basis by Mr Ashik Thiruvathakath Korundavalapil (Ashik) and his wife Ms Sabitha Ayangil (Sabitha).

88    Between January and March 2017, the Nowra Restaurant was closed three times following health inspections by the Shoalhaven City Council. In mid-March 2017, Mr Usha arranged for renovation works to be undertaken and for an inspection by Shoalhaven City Council to be conducted, before Namitha Nakul commenced operating the Nowra Restaurant in April 2017 under the name “Adithya Kerala Nowra”.

89    Between April 2017 and April 2019, the Nowra Restaurant was open six days a week (Tuesday to Sunday) generally from 11.30 am to 2.30 pm for lunch and from 5.00 pm to 9.00 pm for dinner. Take away orders were received and prepared between lunch and dinner opening times. During lunch the Nowra Restaurant also offered a lunch special with curries already prepared in warmers in the kitchen.

90    Not all of the food served at the Nowra Restaurant was prepared on site. I am satisfied that a significant proportion of the food served at the Nowra Restaurant was pre-cooked food that was delivered to the Nowra Restaurant by Mr Usha and Ms Kumar each Monday after being prepared at the Wollongong Restaurant. This pre-cooked food was then reheated and finished with any garnishes before being served to customers at the Nowra Restaurant.

91    The majority of transactions at the Nowra Restaurant were processed by EFTPOS but some patrons paid in cash. The EFTPOS records for the Nowra Restaurant record that 88% of its business occurred between 11.30 am and 3.30 pm and 5.00 pm and 9.30 pm.

92    On 23 May 2018, Ms Elizabeth Csanitz, an Environmental Health Officer from Shoalhaven City Council, conducted a routine primary inspection of the Nowra Restaurant. The inspection was conducted on site between 1.13 pm and 2.30 pm. Mr Basi and Mr Usha were present during the inspection, but not Mr Haider.

93    Mr Csantiz stated in her report of the inspection that “Chef” (presumably a reference to Mr Basi) “did not appear to have the required knowledge to handle and prepare food safely”; and the “[c]hicken tikka was found being re-heated in the microwave … Chicken is delivered frozen, thawed, cooked, cooled and reheated and was to then be transported & reheated before service again … Delivering/catering of cooked foods was discussed at length with the Owner” (presumably a reference to Mr Usha).

Financial position of Namitha Nakul

94    The 2017/2018 financial statements of Namitha Nakul (Financial Statements) record that the company had a trading income of $193,164 for the year ended 30 June 2017 (FY 2017) and $213,632 for the year ended 30 June 2018 (FY 2018) with a gross profit from trading after deducting costs of sales of $125,985 for FY 2017 and $141,483 for FY 2018.

95    After deducting expenses, including salaries, the Financial Statements record that Namitha Nakul incurred a loss from ordinary activities of ($50,086) for FY 2017 and ($97,055) for FY 2018.

Overview of Legislative and Industrial Scheme

Modern Award Compliance – s 45

96    Pursuant to Part 2-1 of the FW Act, the terms and conditions of employment of “national system employees” are prescribed by the following:

(a)    the NES, set out at Part 2-2 of the FW Act;

(b)    modern awards; and

(c)    enterprise agreements.

97    The NES is comprised of a number of fundamental minimum standards as to maximum weekly hours of work, parental leave, personal leave, annual leave and other entitlements. Section 44 of the FW Act prohibits contraventions of the NES. A contravention of the NES attracts a civil penalty.

98    Modern awards may not derogate from entitlements established by the NES: ss 55 and 56 of the FW Act.

99    Section 45 of the FW Act obliges employers not to contravene terms of any modern award applicable to them in respect of their industry:

45 Contravening a modern award

A person must not contravene a term of a modern award.

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

Note 2:     A person does not contravene a term of a modern award unless the award applies to the person: see subsection 46(1).

100    An employer may only contravene an Award that applies to them: s 46(1) of the FW Act. An Award applies to an employer if it is expressed to cover the employer (s 47(1)(a)), and where there is no other provision that has the effect that the Award does not apply (s 47(1)(c)).

The Restaurant Industry Award 2010

101    The relevant provisions of the Award were not in dispute.

102    Clause 4.1 of the Award states that:

4.1 This industry award covers employers throughout Australia in the restaurant industry and their employees in the classifications listed in Schedule B—Classification Structure and Definitions to the exclusion of any other modern award.

103    The Award’s application to particular employees is therefore conditioned upon:

(a)    the employer being in the “restaurant industry” as defined; and

(b)    the employee being employed in one of the classifications (or work roles) listed in Schedule B to the Award.

104    “Restaurant industry” is defined in cl 3 as:

restaurant industry means restaurants, reception centres, night clubs, cafés and roadhouses, and includes any tea room, café, and catering by a restaurant business but does not include a restaurant operated in or in connection with premises owned or operated by employers covered by any of the following awards:

(a) Hospitality Industry (General) Award 2010;

(b) Registered and Licensed Clubs Award 2010; or

(c) Fast Food Industry Award 2010

105    The classifications listed in the Award include kitchen attendants and cooks, who are in the B3 Kitchen stream in Schedule B of the Award.

106    There are eight classifications in the Kitchen stream, described as follows:

B.3.1 Kitchen attendant grade 1 means an employee engaged in any of the following:

(a) general cleaning duties within a kitchen or food preparation area and scullery, including the cleaning of cooking and general utensils used in a kitchen and restaurant;

(b) assisting employees who are cooking;

(c) assembly and preparation of ingredients for cooking; and

(d) general pantry duties.

B3.2 Kitchen attendant grade 2 means an employee who has the appropriate level of training, and who is engaged in specialised non-cooking duties in a kitchen or food preparation area, or supervision of kitchen attendants.

B.3.3 Kitchen attendant grade 3 means an employee who has the appropriate level of training including a supervisory course, and has the responsibility for the supervision, training and co-ordination of kitchen attendants of a lower grade.

B.3.4 Cook grade 1 means an employee who carries out cooking of breakfasts and snacks, baking, pastry cooking or butchering.

B.3.5 Cook grade 2 means an employee who has the appropriate level of training and who performs cooking duties such as baking, pastry cooking or butchering.

B.3.6 Cook grade 3 (tradesperson) means a commi chef or equivalent who has completed an apprenticeship or who has passed the appropriate trade test or who has the appropriate level of training, and who is engaged in cooking, baking, pastry cooking or butchering duties.

B.3.7 Cook grade 4 (tradesperson) means a demi chef or equivalent who has completed an apprenticeship or who has passed the appropriate trade test or who has the appropriate level of training and who is engaged to perform general or specialised cooking, butchering, baking or pastry cooking duties and/or supervises and trains other cooks and kitchen employees.

B.3.8 Cook grade 5 (tradesperson) means a chef de partie or equivalent who has completed an apprenticeship or has passed the appropriate trade test or who has the appropriate level of training in cooking, butchering or pastry cooking and who performs any of the following:

(a) general and specialised duties including supervision or training of other kitchen staff;

(b) ordering and stock control; and

(c) solely responsible for other cooks and other kitchen employees in a single kitchen establishment.

107    The respective classification grades in the various streams have a corresponding minimum wage rate level in clause 20 of the Award, with the lowest minimum wage level and rates applicable to the entry level role and the highest minimum wage rates and levels applicable to the supervisory and skilled trades roles. The rates in clause 20 are broken down into minimum weekly and hourly rates.

108    Clause 20 of the Award provides that an adult employee within a specified level will be paid not less than the rate per week assigned to the classification, as defined in Schedule B, for the area in which such employee is working:

109    The Award regulates the hours of work of employees, and the arrangement of the ordinary hours of work (regardless of classification grade). It relevantly provides:

31. Hours of work

31.1 The hours of work of a full-time employee are an average of 38 per week over a period of no more than four weeks.

31.2 The arrangement of ordinary hours must meet the following conditions:

(a) a minimum of six hours and a maximum of 11 and a half hours may be worked on any one day. The daily minimum and maximum hours are exclusive of meal break intervals;

(b) an employee cannot be rostered to work for more than 10 hours per day on more than three consecutive days without a break of at least 48 hours;

(c) no more than eight days of more than 10 hours may be worked in a four week period;

(d) an employee must be given a minimum break of 10 hours between the finish of ordinary hours of work on one day and the commencement of ordinary hours of work on the next day. In the case of a changeover of rosters the minimum break must be eight hours;

(e) an employee must be given a minimum of eight full days off per four week period; …

110    The term “ordinary hours” is not defined in the Award, but is defined in the FW Act at s 20 in relation to award/agreement free employees. The concept of ordinary hours was discussed by Allsop CJ in Bluescope Steel (AIS) Pty Ltd and Another v Australian Workers’ Union (2019) 270 FCR 359; [2019] FCAFC 84 at [38] (Bluescope Steel) as follows:

… the word “ordinary” and the phrase “ordinary hours” have assumed different meanings depending on context and circumstance. There are circumstances and contexts where the word and phrase can be seen to refer to regular, normal, customary or usual hours; and there are circumstances or contexts where the word and phrase can be seen to refer to the hours of work referred to in applicable industrial instruments as standard hours to be paid at ordinary rates, as opposed to additional hours (even if required, usual, regular, normal or customary) and paid at a special or higher rate. As such, the word and phrase can be seen to reflect the long-recognised distinction between ordinary hours of work and overtime: cf Thompson v Roche Bros Pty Ltd [2004] WASCA 110 at [31].

111    The Award (at the relevant times) established an entitlement to breaks in the terms set out below:

32. Breaks

32.1 If an employee, including a casual employee, is required to work for five or more hours in a day the employee must be given an unpaid meal break of no less than 30 minutes. The break must be given no earlier than one hour after starting work and no later than six hours after starting work.

32.2. If the unpaid meal break is rostered to be taken after five hours of starting work, the employee must be given an additional 20 minute paid meal break. The employer must allow the employee to take this additional meal break no earlier than two hours after starting work and no later than five hours after starting work.

32.3 If an employee is not given the unpaid meal break at the time the employer has told the employee it will be given, the employer must pay the employee 150% of the employee’s ordinary base rate of pay from the time the meal break was to commence until either the meal break is given or the shift ends.

32.4 If clause 32.3 does not apply and an employee is not given a meal break in accordance with clause 32.1 the employer must pay the employee 150% of the employee’s ordinary base rate of pay from the end of six hours until either the meal break is given or the shift ends.

32.5 If an employee is required to work more than five hours after the employee is given the unpaid meal break, the employee must be given an additional 20 minute paid break.

32.6 If a full-time or regular part-time employee is required to work more than 10 ordinary hours in the day, the employee will be given two additional 20 minute paid breaks. In rostering for these breaks, the employer must make all reasonable efforts to ensure an even mix of work time and breaks.

112    The Award provisions in respect of hours and breaks are coupled with provisions for the payment of penalty rates for additional hours of work or work at unsociable times as follows:

33. Overtime

33.1 Requirement to pay overtime rates

(a) Full-time and part-time employees are paid at overtime rates for any work done outside of the spread of hours or rostered hours set out in clause 31—Hours of work.

…

33.2 Overtime rates

The overtime rate payable to an employee depends on the time at which the overtime is worked.

(a) Monday to Friday: 150% of the employee’s ordinary base rate of pay for the first two hours of overtime then 200% of the employee’s ordinary base rate of pay for the rest of the overtime.

(b) Between midnight Friday and midnight Saturday: 175% of the employee’s ordinary base rate of pay for the first two hours of overtime then 200% of the employee’s ordinary base rate of pay for the rest of the overtime.

(c) Between midnight Saturday and midnight Sunday: 200% of the employee’s ordinary base rate of pay for all time worked.

…

34.1 Penalty rates for work on weekends and public holidays

…

An employee working ordinary time hours on the following days will be paid the following percentage of the minimum wage in clause 20—Minimum wages for the relevant classification:

113    The Award also imposes an obligation on employers to make superannuation contributions in respect of employees:

30.2 Employer contributions

(a) An employer must make such superannuation contributions to a superannuation fund for the benefit of an employee as will avoid the employer being required to pay the superannuation guarantee charge under superannuation legislation with respect to that employee.

(b) The employer must make contributions for each employee for such month where the employee earns $350.00 or more in a calendar month.

114    In Bluescope Steel, the Full Court (Allsop CJ, Collier and Rangiah JJ) considered the question of whether provisions in an award and enterprise agreement concerning superannuation could create binding (and therefore contravenable) obligations. The Court considered arguments to the effect that the provisions merely reflected or acknowledged the obligations created in the Commonwealth superannuation legislation but did not independently impose any obligation upon the employer. The Court accepted that argument in respect of the Award provision, but concluded (Allsop CJ at [12], Collier J at [237], Rangiah J agreeing at [356]-[358]), that the enterprise agreement provision stating that the employer will make superannuation contributions created an independently enforceable obligation, which was capable of being contravened.

115    The Award contains an entitlement to receive leave loading of 17.5%:

35. Annual leave

…

a.2    Payment for annual leave

(a) The NES prescribes the basis for payment for annual leave, including payment for untaken leave upon the termination of employment.

(b) In addition to the payment provided for in the NES, an employer is required to pay an additional leave loading of 17.5% of that payment.

116    The clause expands on the annual leave entitlements established in the NES at Division 6 of Part 2-2 of the FW Act. Section 90 within that Division provides as follows:

(1)     If, in accordance with this Division, an employee takes a period of paid annual leave, the employer must pay the employee at the employee’s base rate of pay for the employee’s ordinary hours of work in the period.

(2)     If, when the employment of an employee ends, the employee has a period of untaken paid annual leave, the employer must pay the employee the amount that would have been payable to the employee had the employee taken that period of leave.

117    The established approach to the construction and application of industrial instruments is contained in the following frequently cited statement by Madgwick J in Kucks v CSR Limited (1996) 66 IR 182 at 184:

It is trite that narrow or pedantic approaches to the interpretation of an award are misplaced. The search is for the meaning intended by the framer(s) of the document, bearing in mind that such framer(s) were likely of a practical bent of mind: they may well have been more concerned with expressing an intention in ways likely to have been understood in the context of the relevant industry and industrial relations environment than with legal niceties or jargon. Thus, for example, it is justifiable to read the award to give effect to its evident purposes, having regard to such context, despite mere inconsistencies or infelicities of expression which might tend to some other reading. And meanings which avoid inconvenience or injustice may reasonably be strained for. For reasons such as these, expressions which have been held in the case of other instruments to have been used to mean particular things may sensibly and properly be held to mean something else in the document at hand.

Fair Work Act 2009 (Cth)

Obligation to pay amounts payable – s 323

118    Section 323 of the FW Act imposes obligations upon employers in respect of the payment of employee entitlements, such as wages. It provides:

323 Method and frequency of payment

(1)    An employer must pay    an employee amounts payable to the employee in relation to the performance of work:

(a)    in full (except as provided by section 324); and

(b)    in money by one, or a combination, of the methods referred to in subsection (2); and

(c)    at least monthly.

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

Note 2:     Amounts referred to in this subsection include the following if they become payable during a relevant period:

(a)    incentive-based payments and bonuses;

(b)    loadings;

(c)    monetary allowances;

(d)    overtime or penalty rates;

(e)    leave payments.

(2)    The methods are as follows:

(a)    cash;

(b)    cheque, money order, postal order or similar order, payable to the employee;

(c)    the use of an electronic funds transfer system to credit an account held by the employee;

(d)    a method authorised under a modern award or an enterprise agreement.

(3)    Despite paragraph (1)(b), if a modern award or an enterprise agreement specifies a particular method by which the money must be paid, then the employer must pay the money by that method.

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

119    The section imposes an obligation upon the employer to pay any amount or amounts payable to an employee. Each entitlement, whether as to wages, overtime, or leave loading, will give rise to a separate contravention of s 323 where it is not paid: Stratton Finance Pty Limited v Webb (2014) 314 ALR 166; [2014] FCAFC 110 at [47] (Allsop CJ, Siopsis and Flick JJ).

120    As the High Court (Crennan, Kiefel, Bell, Gageler and Keane JJ) observed in Construction Forestry Mining and Energy Union v Mammoet Australia Pty Ltd (2013) 248 CLR 619; [2013] HCA 36 at [45], the section (and others in the Division) address the same mischief as that addressed by the “Truck Acts” — the prospect that an employer may attempt to satisfy its obligations to pay wages by making payments in kind.

Unreasonable requirement by employer that employee pay or spend money – s 325

121    From the commencement of the employment of Mr Basi and Mr Haider by Namitha Nakul, until 15 September 2017, s 325 provided:

325 Unreasonable requirements to spend amount

(1)    An employer must not directly or indirectly require an employee to spend any part of an amount payable to the employee in relation to the performance of work if the requirement is unreasonable in the circumstances.

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

(2)    The regulations may prescribe circumstances in which a requirement referred to in subsection (1) is or is not reasonable

122    In Australian Education Union v State of Victoria (Department of Education and Early Childhood Development) (2015) 239 FCR 461; [2015] FCA 1196 (AEU), Bromberg J proceeded on the basis, without deciding, that the reference to “spend” in s 325 was capable of having application to monies deducted from wages or salary, noting that the section refers to amounts “payable” to an employee: see [340]-[341].

123    Since 15 September 2017, s 325 has (relevantly) provided as follows:

325 Unreasonable requirements to spend or pay amount

(1)    An employer must not directly or indirectly require an employee to spend, or pay to the employer or another person, an amount of the employee's money or the whole or any part of an amount payable to the employee in relation to the performance of work, if:

(a)    the requirement is unreasonable in the circumstances; and

(b)    for a payment--the payment is directly or indirectly for the benefit of the employer or a party related to the employer.

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

…

(2)    The regulations may prescribe circumstances in which a requirement referred to in subsection (1) or (1A) is or is not reasonable.

124    Justice Bromberg considered the question of unreasonableness in AEU, which involved a deduction by the employer from teachers’ wages for the provision of laptop computers. In that judgment, his Honour said, as to the question of what was “unreasonable”:

355.    The Explanatory Memorandum to the FW Bill provided the following examples of requirements which may be reasonable or unreasonable:

1292.    For example, it is likely to be unreasonable for an employer to require an employee to donate a proportion of his or her pay to a charitable or religious organisation nominated by the employer. It may be reasonable, however, for an employer to require an employee who is a tradesperson to purchase tools required to perform his or her duties (unless the employer is otherwise required to provide those tools).

356.    I agree with the approach taken by both the AEU and DEECD, that “unreasonable in the circumstances” was likely to have been intended to have the same meaning in s 325(1) as in s 326(1)(c)(ii). For the same reasons that I found the deductions were “unreasonable in the circumstances” when determining the s 326(1)(c)(ii) question, I would find that the requirements made by DEECD of the Group 11 teachers to spend parts of the amounts payable to them in relation to their performance of work were “unreasonable in the circumstances”. In summary:

(i)    the spending required occurred in the absence of genuine choice;

(ii)    the rate of spending was set at an excessive rate of contribution;

(iii)    the deductions made were not principally for the benefit of the Group 11 teachers; and

(iv)    the value of the benefits actually received by them did not provide a countervailing justification.

125    The Explanatory Memorandum to the Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017 (which introduced the amendment to s 325) provided examples of circumstances where it would be unreasonable for an employer to receive an employee’s money, including the practice of paying employees the ostensibly lawful rate and then coercing payments back in cash in exchange for not terminating employment or in order to undercut minimum entitlements and compelling an employee to spend their money in a manner which involves undue influence, duress or coercion.

126    In Ahmed v Al-Hussain Pty Ltd t/as The Cheesecake Shop (No 2) [2019] FCA 670 (Cheesecake Shop) at [72], Rares J found that a cash payback arrangement constituted a contravention of s 325.

Part 3-1 – General Protections

127    Division 3 of Part 3-1 of the FW Act contains provisions which protect the enjoyment or exercise by employees of workplace rights. Pursuant to s 341(1) of the FW Act, a person has a “workplace right” where the person:

(a)     is entitled to the benefit of, or has a role or responsibility under, a workplace law, workplace instrument or order made by an industrial body; …

128    Section 12 of the FW Act defines:

(a)    “workplace law” to include the FW Act; and

(b)    “workplace instrument” to mean an instrument made under or recognised by a workplace law, which concerns the relationship between employers and employees.

129    Rights contained in the FW Act, or in modern awards made under the FW Act, are “workplace rights” within the meaning of that term in Division 3 of Part 3-1 of the FW Act.

Obligation to keep records – s 535

130    Section 535 imposes an obligation upon an employer to maintain employee records for seven years. It provides:

535 Employer obligations in relation to employee records

(1)    An employer must make, and keep for 7 years, employee records of the kind prescribed by the regulations in relation to each of its employees.

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

(2)    The records must:

(a)    if a form is prescribed by the regulations–be in that form; and

(b)    include any information prescribed by the regulations.

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

(3)    The regulations may provide for the inspection of those records.

Note:     If an employer fails to comply with subsection (1), (2) or (3), the employer may bear the burden of disproving allegations in proceedings relating to a contravention of certain civil remedy provisions: see section 557C.

(4)    An employer must not make or keep a record for the purposes of this section that the employer knows is false or misleading.

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

(5)    Subsection (4) does not apply if the record is not false or misleading in a material particular.

131    Subsections (4) and (5) were inserted by the Fair Work Amendment (Protecting Vulnerable Workers) Act 2017 (Cth) and commenced on 15 September 2017.

132    Subdivision 1 of Part 3-6 of the Fair Work Regulations 2009 (FW Regulations) prescribes the content of the employee records s 535 requires an employer to make and keep.

133    An employee record must:

(a)    be legible, in English and readily accessible to an inspector (reg 3.31);

(b)    record the employer’s name, the employee’s name, employment status (full-time, part-time, permanent, temporary or casual) and the date of commencement (reg 3.32);

(c)    where a penalty rate or loading is payable in respect of overtime hours worked by an employee, specify the number of overtime hours worked each day and when the employee started and ceased those hours (reg 3.34);

(d)    record any leave taken by the employee and the balance remaining from time to time (reg 3.36); and

(e)    record any superannuation contributions required to be made for the benefit of the employee (reg 3.37).

134    Furthermore, reg 3.33 of the FW Regulations provides:

3.33 Records—pay

(1)     For subsection 535(1) of the Act, a kind of employee record that an employer must make and keep is a record that specifies:

(a)     the rate of remuneration paid to the employee; and

(b)     the gross and net amounts paid to the employee; and

(c)     any deductions made from the gross amount paid to the employee.

(2)     If the employee is a casual or irregular part‑time employee who is guaranteed a rate of pay set by reference to a period of time worked, the record must set out the hours worked by the employee.

(3)     If the employee is entitled to be paid:

(a)     an incentive‑based payment; or

(b)     a bonus; or

(c)     a loading; or

(d)     a penalty rate; or

(e)     another monetary allowance or separately identifiable entitlement;

the record must set out details of the payment, bonus, loading, rate, allowance or entitlement.

135    Sub-regulation (2) specifically states that records of hours worked must be kept “if the employee is a casual or irregular part-time employee”. No record of hours is stated to be necessary to be kept for full-time employees.

Fair Work Act Remedies – Part 4-1

136    Where it is satisfied that a person has contravened a civil remedy provision, the Court may:

(a)    order that person to pay a pecuniary penalty (s 546); and

(b)    make any other order it considers appropriate (s 545(1)), including orders awarding compensation for loss that a person has suffered because of a contravention (s 545(2)(b)).

137    The maximum penalties applicable to contraventions of civil remedy provisions of the FW Act appear at column 4 of the table to s 539(2). For bodies corporate, the maximum penalties are five times the maximum specified in s 539(2): see s 546(2) of the FW Act.

138    A person who is involved in a contravention of a civil remedy provision of the FW Act is taken to have contravened that provision. Subsection 550(2) defines involvement in the following terms:

(2)    A person is involved in a contravention of a civil remedy provision if, and only if, the person:

(a)    has aided, abetted, counselled or procured the contravention; or

(b)    has induced the contravention, whether by threats or promises or otherwise; or

(c)    has been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to the contravention; or

(d)    has conspired with others to effect the contravention.

139    Since 15 September 2017, the FW Act has also provided for increased penalties for “serious contraventions” that are ten times the penalties for normal contraventions.

The applicants’ employment

When did Mr Basi commence employment with Namitha Nakul?

140    The applicants submit that Mr Basi commenced working for Namitha Nakul at the Wollongong Restaurant on or about 19 July 2016.

141    The respondents submit that Mr Basi did not commence working for Namitha Nakul at the Wollongong Restaurant until 16 November 2016.

142    Mr Basi gave evidence that he commenced working at the Wollongong Restaurant on or about 19 July 2016 and received an amount of $600 per week from Mr Usha in cash from that time until he started receiving payments by bank transfer in February 2017.

143    Mr Usha gave evidence that Mr Basi did not commence working at the Wollongong Restaurant until 16 November 2017 after the transfer of Mr Basi’s subclass 457 visa had been approved.

144    I accept the evidence of Mr Basi in preference to that of Mr Usha on this issue. I am satisfied that Mr Basi commenced working for Namitha Nakul at the Wollongong Restaurant on or about 19 July 2016, being the date that he accepted the Basi Employment Offer, for the following reasons.

145    First, Mr Basi’s evidence is corroborated to a significant extent by his bank statements. They show that he was in Wollongong from no later than 25 July 2016, a city with which he had no prior connection, until about May 2017, when he commenced to engage in regular transactions around the Nowra area.

146    Second, Mr Basi’s bank statements also show a pattern of transactions consistent with his account that he worked for the respondents, was paid in cash an amount of $600 per week in the period up to the end of January 2017 and made regular international transfers of money to his parents in India. A summary of those transactions appears below:

147    The cash deposits continued in much the same amounts and frequency between 16 November 2016 and 8 February 2017, that is, in the period after Mr Usha accepted that Mr Basi commenced employment up until Mr Usha commenced paying Mr Basi by bank transfer. Mr Usha admitted that he paid Mr Basi in cash when he commenced even though he was familiar with making electronic funds transfers to pay business expenses.

148    Third, no suggestion was made to Mr Basi in cross-examination that he had found any alternative employment in Wollongong in the period between July and November 2016.

149    Fourth, Mr Usha had been seeking the assistance of a cook in the Wollongong Restaurant from early 2016. Mr Usha had advertised a role as a Cook on Gumtree and on 4 July 2016 he had been approved by the Department to become a sponsor. Mr Usha gave evidence that he made the offer to Mr Basi notwithstanding an unsatisfactory performance by Mr Basi at a trial, saying: “I will hire you, because I need staff”.

150    Mr Usha did not identify any other person who filled the role prior to November 2016.

151    Fifth, although the Basi Employment Offer was expressed to be “subject to the successful outcome of your 457 Nomination transfer to our company”, I do not give much weight to that reservation. I do not regard Mr Usha as a person whose conduct was dictated by a scrupulous attention to compliance with his legal obligations with respect to the employment of staff. Mr Usha failed to make superannuation contributions for Mr Basi and Mr Haider or pay them annual leave or leave loading during the periods that they were employed by Namitha Nakul. He conceded in cross-examination that he had issued incorrect PAYG statements and that he deferred the payment of salaries from time to time. I note that I issued a s 128 Evidence Act certificate to Mr Usha in relation to that concession.

When did Mr Haider commence employment with Namitha Nakul?

152    The applicants submit that Mr Haider first commenced performing work for Namitha Nakul in about July 2016 at the premises at which the Nowra Restaurant was located (Nowra Premises).

153    The respondents submit that Namitha Nakul did not operate the Nowra Restaurant until March 2017 and any work that Mr Haider might have performed prior to March 2017 was not undertaken for Namitha Nakul.

Background facts

154    On 4 July 2016, Namitha Nakul paid $1000 to the real estate agent who managed the Nowra Premises. On 30 August 2016 Namitha Nakul made a further payment of $452 to the same agent.

155    On 24 August 2016, the business name “1980s A Nostalgic Restaurant” was added to the business names registered to Namitha Nakul. That was the name on the sign at the rear of the building on the Nowra Premises, although “1980s” was far more prominently displayed than what appears to be the words below “A Nostalgic Restaurant” or perhaps alternatively, “An Indian Restaurant”, as suggested by the Mr Haider in the course of his cross-examination.

156    A Nostalgic Restaurant Pty Ltd (Nostalgic) was a company that was registered on 22 March 2016. Mr Usha was a director and company secretary of Nostalgic from 22 March 2016 until 23 August 2017. The only other director of Nostalgic during that period was Sabitha, Ashik’s wife. The four shareholders in Nostalgic during the same period, each holding one ordinary share, were Mr Usha, Namitha Nakul, Sabitha and Mylutfa Investments Pty Ltd.

157    On 20 September 2016, Namitha Nakul took a three year lease, with a commencement date of 24 August 2016, of the Premises (Nowra Lease). Mr Usha signed the Nowra Lease for Namitha Nakul and provided a personal guarantee of Namitha Nakul’s obligations under the lease.

158    The Nowra Restaurant opened on 31 October 2016 under the name “1980’s A Nostalgic Restaurant”. The business name “1980’s” is owned by Nostalgic. On 16 January 2017, Namitha Nakul paid the rent of $1452 on the Nowra Premises to Nowra First National.

159    On both 31 January 2017 and 7 February 2017, $500 was transferred from Namitha Nakul to Mr Haider. The notations for the transfers on Mr Haider’s bank statements were, respectively, “adithya salary vaisakh” and “salary vaisakh adithya”.

Evidence of Mr Haider, Mr Usha and Ms Kumar

160    Mr Haider gave evidence that he first visited the Nowra Premises in about June 2016 and shortly afterwards had discussions with Mr Usha, Ms Kumar and then Mr Usha, Ms Kumar and Ashik.

161    Ms Kumar accepted that she went to the Nowra Premises with Mr Usha and Mr Haider as Mr Usha wanted to set up a restaurant and to get her opinion whether the Nowra Premises could be converted to a restaurant. Ms Kumar could not recall the date of the visit.

162    Mr Haider gave evidence that he attended a meeting in June or July 2016 with Mr Usha, Ms Kumar and Ashik at the Wollongong Restaurant in which he was offered employment as a cook, told he would be paid the market rate and in which they said to him words to the following effect:

We will sponsor you for a 457 visa. The job is full time and after 2 years you can apply for Permanent Residency. We got our permanent residency after having 457 visas ourselves.

163    Mr Haider gave evidence that after receiving this offer from Mr Usha he resigned his then current job at the Garam Masala restaurant.

164    In stark contrast to this evidence, Mr Usha gives evidence that he had meeting with Mr Haider and Ashik at the Wollongong Restaurant “in about early August 2016” in which he only said words to the following effect:

Ashik, this is Syed, I think you and Syed both go to the same Mosque at Lidcombe.

165    He gave evidence that a short time later he had a conversation with Ashik at the Wollongong Restaurant in words to the following effect:

Ashik:        How is your friend going? Do you know if he is a cook?

Vaisakh:    I know he works at Garam Masala, but don’t know his skill level. I can give him a call if you want.

Ashik:        I have his number already, thanks.

166    Mr Haider gave evidence that a few weeks after resigning from Garam Masala he had a further discussion with Mr Usha about the market rate he was to be paid in which Mr Usha said to him words to the following effect:

The market rate is $54,500 or $54,400. I’ve already talked to Ashik and the other partner has no problem with it. You will be full-time, have paid leave, and you can go to Pakistan anytime and it will be easy.

167    Mr Haider gave evidence that he commenced working at the Nowra Premises on about 10 July 2016, initially getting it ready for trading, clearing out and assembling new furniture, doing cleaning, painting and similar activities and sourcing a tandoori oven at Mr Usha’s request.

168    He gave evidence that he worked at the Nowra Premises for around 30 hours per week without receiving any payment, save that he was given some money as expenses by Mr Usha, until the Nowra Restaurant opened on 31 October 2016. He stated that he was in regular contact with Mr Usha prior to the opening of the Nowra Restaurant.

169    Mr Usha gave evidence that the payment from Namitha Nakul to the real estate agent for the Nowra Premises on 4 July 2016 was to get the “paperwork” started. He conceded that he provided assistance to Ashik in preparing the Nowra Restaurant for opening but maintained that Ashik wanted to operate the Nowra Restaurant.

170    Mr Usha denied asking Mr Haider to carry out tasks prior to the opening of the Nowra Restaurant. He claimed that the business was not that of Namitha Nakul, as follows:

When Namitha Nakul took over the lease that was because it was Namitha Nakul’s business. That’s right, isn’t it?---That’s not right because the lease – I took it but that period, from starting, Ashek was running that business. That’s why I didn’t involve anything. So the painting and everything Ashek did and all the job – everything is Ashek. He managed.

171    Mr Usha gave evidence that in or about October 2016, he visited Ashik at the Nowra Restaurant prior to the date on which it commenced trading and had a conversation with him in words to the following effect:

Vaisakh:    Why is Syed here?

Ashik:        He is helping me.

Vaisakh:    Okay.

172    Mr Haider gave evidence that in a conversation that he had with Mr Usha in around the second week of November 2016, after the Nowra Restaurant had been open for a little over a month, Mr Usha stated:

I can only afford to pay you $500 per week. As the restaurant gets busier I will pay you more.

173    Mr Usha gave evidence that the Nowra Restaurant received an Improvement Notice from the Council on or about 2 December 2016.

174    Mr Usha gave evidence that on or about 20 December 2016, he was told by Mr Haider that:

For Ashiq if he is not taking things seriously then I am left with no option then to contact other partner [Vaisakh].

175    The identification of the “other partner” being “[Vaisakh]” was made by Mr Usha himself in his affidavit.

176    Mr Usha then went on to explain in his affidavit that:

Following this, Syed would contact me in relation to a number of issues which arose. Initially, I told Syed to contact Ashik but as more problems arose, I took on more responsibility in resolving the problems he brought to me.

177    He further gave evidence that a Prohibition Order was issued prohibiting trading on 13 January 2017, and that on 15 March 2017, there was a third inspection that resulted in the Nowra Restaurant again being closed. Mr Usha gave evidence that Namitha Nakul took over the operation of the Nowra Restaurant from the end of March 2017 when it reopened as “Adithya Kerala Nowra”.

178    Mr Usha gave the following explanation of how Namitha Nakul took over the operation of the Nowra Restaurant in mid-March 2017:

Vaisakh:     You are not interested to run the business. There is two options, one, the Council shuts you down, or, two you give me all the shares in the business and I will run it.

Ashik:        Okay, I don’t want the business.

179    Mr Usha gave evidence that Mr Haider did not commence working for Namitha Nakul until March 2017, around the time Mr Usha and Namitha Nakul took over the running of the Nowra Restaurant from Ashik.

180    Mr Haider also gave evidence, that in April 2017, when Mr Basi started at the Nowra Restaurant, Mr Usha told Mr Haider that he would pay him $600 a week.

181    That amount was the same amount that Mr Basi was in fact receiving, after the cashback arrangements were taken into account.

Consideration

182    Mr Haider’s evidence concerning the work that he undertook at the Nowra Premises in the period between 10 July and 30 October 2016 was not contradicted in any material respect by the respondents and I accept it.

183    Rather, the relevant dispute was for whose benefit the work was undertaken.

184    I am satisfied that the work that Mr Haider was doing on the Nowra Premises in the lead up to the opening of the Nowra Restaurant on 31 October 2016 and then in the period to 31 March 2017 was ultimately being undertaken for Namitha Nakul and that Mr Haider was being employed on a full time basis. I have reached that conclusion for the following reasons.

185    First, Mr Usha arranged for Mr Haider to work at the Nowra Premises prior to the commencement of trading by the Nowra Restaurant under the name “1980s A Nostalgic Restaurant”, Mr Haider had frequent contact with Mr Usha prior to March 2017 and the only evidence of any payments being made to Mr Haider during the period from July 2016 to March 2017 were payments from Namitha Nakul, described as salary payments, and reimbursements by Mr Usha of expenses incurred by Mr Haider.

186    Second, I accept the evidence given by Mr Haider concerning his conversations with Mr Usha in June, July and November 2016 as to the basis on which he was to be employed. There was no substantive challenge to Mr Haider’s evidence in the course of his cross-examination and it was consistent with the apparent logic of events and the facts capable of being objectively established. Mr Usha was looking to open a new restaurant in Nowra and needed full time staff to operate it and Mr Haider was prepared to leave his current employment and move to Nowra. The absence of any payment consistent with full time employment is explicable given the start-up nature of the Nowra Restaurant and the informal and ad hoc manner in which Mr Usha approached his responsibilities as an employer. The contrary evidence of Mr Usha was inherently implausible, particularly the impression sought to be created that he had no knowledge that Mr Haider was working at the Nowra Premises until he observed him working there during a visit to Ashik in October 2016.

187    Third, Mr Usha and Namitha Nakul were inextricably linked in the operation of the Nowra Restaurant under the trading name “1980s A Nostalgic Restaurant”. Mr Usha was a fellow director of Nostalgic with Sabitha, Namitha Nakul was the owner of the business name “1980s A Nostalgic Restaurant” and it had entered into the Nowra Lease and paid rent under the Nowra Lease during that period.

188    Fourth, I accept that Ashik and Sabitha, together with Mr Haider, were physically operating the Nowra Restaurant on a day to day basis under the trading name “1980s A Nostalgic Restaurant” in the period between 31 October 2016 and approximately January 2017. This finding, however, is of little significance in the absence of any evidence that Mr Haider received any payment from Ashik or Sabitha, either in the period up to 31 October 2016 or in the period that the Nowra Restaurant traded as “1980s A Nostalgic Restaurant”, and Mr Haider’s evidence that he only received payments from Mr Usha for his work during these periods.

189    Fifth, the explanation provided by Mr Usha as to the circumstances in which he took over the Nowra Restaurant from Ashik is more consistent with the existence of an existing business relationship that Mr Usha and Namitha Nakul had with Ashik rather than an arms-length transaction between two discrete parties. There was no offer of any payment by Mr Usha to Ashik for the restaurant, nor was there any evidence that Ashik made any contribution towards the rent for the Nowra Premises during the period the “1980s A Nostalgic Restaurant” operated, nor that he paid any wages or made any other payments to Mr Haider.

190    Sixth, the respondents did not call Ashik, and gave no explanation for why they failed to do so. The applicants submit that by reason of the failure of the respondents to call Ashik or provide an explanation for why they had failed to do so, I can more readily draw the inference from the evidence of Mr Haider and the evidence concerning the Nowra Lease that Namitha Nakul was the business owner and operator of the Nowra Restaurant between July 2016 and March 2017. The respondents submit that Ashik was not a director of Namitha Nakul and it cannot be said there was an expectation that he be called by the respondents to give evidence. They submit that the applicants had an equal opportunity to call Ashik or subpoena him to give evidence for the applicants.

191    A Jones v Dunkel (1959) 101 CLR 298 inference can only be drawn where three requirements have been met: first, there was an expectation that one party, as opposed to another, would call the witness; second, the evidence of that witness would have elucidated a particular matter; and third, the absence of that witness was unexplained: see Payne v Parker [1976] 1 NSWLR 191 at 201 (Glass JA); Australian Securities and Investments Commission v Hellicar (2012) 247 CLR 345; [2021] HCA 17 at [169] (French CJ, Gummow, Hayne, Crennan, Kiefel, and Bell JJ) and [263]-[264] (Heydon J).

192    An unexplained failure to call a witness warrants only the drawing of an inference that the uncalled evidence would not have assisted the party’s case (but not an inference that such evidence would have been adverse), and the court drawing, with greater confidence, other inferences open on the evidence: see Kuhl v Zurich Financial Services Australia Ltd and Another (2011) 243 CLR 361; [2011] HCA 11 at [63]-[64] (Heydon, Crennan and Bell JJ). The rule cannot be used to fill gaps in the evidence or to convert conjecture into suspicion: Jagatramka v Wollongong Coal Limited [2021] NSWCA 61 at [49] (Bathurst CJ, Bell P and White JA).

193    I am satisfied that there is sufficient evidence of the relationship between Ashik and Mr Usha for me to conclude that there was an expectation that the respondents, rather than the applicants, would call Ashik. Mr Usha and Namitha Nakul were inextricably linked in the operation of the Nowra Restaurant as explained above.

194    I am satisfied that it is appropriate to draw the Jones v Dunkel inference sought by the applicants and I have therefore more readily drawn the inference that Mr Usha and Namitha Nakul were ultimately responsible for the work that Mr Haider undertook at the Nowra Premises and the Nowra Restaurant prior to the end of March 2017.

Is Mr Haider entitled to payment by Namitha Nakul for the work he performed on the Nowra Premises between about July 2016 and October 2016 on a quantum meruit basis?

Submissions

195    The applicants submit that Mr Haider performed the work at the Nowra Premises in the period between 10 July 2016 and 30 October 2016 at the request of Mr Usha for Namitha Nakul’s business at Nowra and Namitha Nakul received the benefit of that work.

196    The respondents submit that Mr Haider did not commence working for Namitha Nakul until the end of March 2017 and Mr Haider did not engage in any work at Namitha Nakul’s request before that time. They submit that Mr Haider, therefore, has no available quantum meruit claim against Namitha Nakul.

197    The respondents submit that in the period up to January 2017, the Nowra Restaurant was operated by Ashik and Nostalgic under the business name “1980’s”, and that Mr Haider accepted during his cross-examination that the sign on the right hand side of the Nowra Premises during this period advertised the restaurant as “1980’s”. The business name “1980’s” was owned by Nostalgic between 23 March 2016 and 2 November 2017.

198    The respondents also submit that because the tandoori oven was removed by the time Mr Basi commenced working at the Nowra Restaurant (at the end of March 2017), Namitha Nakul received no benefit from any work undertaken by Mr Haider in respect of the tandoori oven, that is, the purchase and any preparation work for its installation.

Relevant principles

199    An action on a quantum meruit basis for the value of work done does not depend upon an express or implied contract, but is available where work has been done and accepted by the defendant: Pavey & Matthews Proprietary Limited v Paul (1986) 162 CLR 221; [1987] HCA 5 (Pavey).

200    As Deane J stated in Pavey at [13]:

The quasi-contractual obligation to pay fair and just compensation for a benefit which has been accepted will only arise in a case where there is no applicable genuine agreement or where such an agreement is frustrated, avoided or unenforceable. In such a case, it is the very fact that there is no genuine agreement or that the genuine agreement is frustrated, avoided or unenforceable that provides the occasion for (and part of the circumstances giving rise to) the imposition by the law of the obligation to make restitution.

201    The Full Court in Nield v Mathieson [2014] FCAFC 74, at [76] (Tracey, Bromberg and Mortimer JJ), expressed the following obiter dicta comments directed at the potential availability of a quantum meruit claim in an employment law context:

Although it is not strictly necessary for us to do so we would record that, had we been minded to accept the appellants’ argument that the trial judge was wrong to find that a contract of employment existed, we would, subject to two reservations, have been disposed to uphold Ms Mathieson’s contention that she was entitled to obtain an order in the same terms as Order 1 on the ground that the appellants had been unjustly enriched by the work which Mathieson had performed but in respect of which she had not been paid. We would have valued that contribution to the appellants’ business by reference to Ms Mathieson’s award entitlements and her statutory entitlements to superannuation contributions and leave. The first reservation is that some discount might have been necessary to take account of the cash payments to Ms Mathieson between August and December 2006, the provision of cigarettes and the value to her of free board and lodgings. Our second reservation is that it would have been necessary for us to have been satisfied, on the evidence, that the appellants had requested Ms Mathieson to perform the work which provided them with the benefit for which they had not paid: see Lumbers v W Cook Builders Pty Ltd (in liq) (2008) 232 CLR 635 at 664–7. This issue was only lightly touched on in written submissions following trial and was not explored at all on appeal. In these circumstances it is not desirable that we express any concluded views about these issues.

Consideration

202    I am satisfied that the applicants have established that Mr Haider is entitled to recover on a quantum meruit basis the fair value of the work that he performed for the respondents in in the period between 10 July and 30 October 2016 in preparing the Nowra Premises for the operation of the Nowra Restaurant, for the following reasons.

203    First, I accept Mr Haider’s unchallenged evidence that from on or about 10 July 2016 until 30 October 2016 he worked an average of 30 hours at the Nowra Premises in preparing the Nowra Restaurant to open for trading as the “1980’s A Nostalgic Restaurant”, on 31 October 2016, an inference I am more prepared to draw in the unexplained absence of any evidence from Ashik.

204    Second, there was no “applicable genuine agreement” for the work that was undertaken by Mr Haider during that period either pursuant to any formal agreement or an industrial award.

205    Third, I am satisfied for the reasons outlined above that the work was undertaken for the ultimate benefit of Mr Usha and Namitha Nakul, given that the Nowra Premises were leased by Namitha Nakul, Mr Usha’s guarantee of the obligations of Namitha Nakul under the Nowra Lease, the circumstances in which Mr Haider was engaged to do the work, the absence of any evidence of any payment for that work from Ashik, the respondents shareholding in Nostalgic and Mr Usha being a director of Nostalgic, combined with the unexplained failure of the respondents to lead any evidence from Ashik to rebut Mr Haider’s evidence.

Does s 557C operate in the present proceedings?

206    Before considering the specific contraventions by the respondents of the civil remedy provisions of the FW Act alleged by the applicants it is necessary to address the potential application of s 557C of the FW Act.

207    Pursuant to s 557C of the FW Act, in proceedings relating to a contravention by an employer of a civil remedy provision, where the employer is required to make and keep records but failed to do so, the employer has the burden of disproving the allegations: s 577C(1) of the FW Act.

208    The respondents contend that the applicants cannot rely on s 557C of the FW Act in the present proceedings.

209    The respondents seek to rely on the following observations by Colvin J in Ghimire v Karriview Management Pty Ltd (No 2) [2019] FCA 1627 (Ghimire) in relation to s 557C of the FW Act:

16.     However, s 557C required an employer who did not keep appropriate records to disprove the allegation. If the evidence adduced by the employer did not rise to the level necessary, on the balance of probabilities, to affirmatively prove that Mr Ghimire and Ms Sharma did not work the hours that they claimed, then the effect of section 557C was that those claims were to be upheld. In that context, it was not enough that there may be reasons to question the credibility of the account given by Mr Ghimire or Ms Sharma. Even if their evidence was not accepted, Karriview would not have thereby disproved the allegation made by them as to the hours that they worked.

17.     It may be that in order for section 557C to apply, the relevant allegation must be made reasonably or bona fide before the provision applies. However, no issue of that kind was raised before the magistrate. The magistrate found expressly that Mr Ghimire and Ms Sharma were not paid anything for their work. They did undertake a considerable amount of work. Mr Quann accepted that they did work at the Lodge during the period alleged. In those circumstances, there was nothing to suggest that the claims were not bona fide.

[Emphasis added by the respondents.]

210    The respondents submit each of Mr Haider’s and Mr Basi’s claims are not made reasonably or bona fide. Mr Haider and Mr Basi allege they each worked in excess of 12 hours a day, six days a week in the face of the undisputed evidence regarding the timing of EFTPOS transactions for the Nowra Restaurant. They submit that Mr Haider and Mr Basi have deposed to vague, imprecise and self-serving evidence to support this allegation including in terms of “frequently took orders after 9.30 pm” and “[i]n the summertime, [Mr Haider] frequently finished after midnight and often closer to 12.45 am”. They contend that there has been no attempt to give specific evidence to support the allegations.

211    The respondents submit, in determining whether s 577C of the FW Act should apply, the Court ought to have regard to the following:

(a)    Mr Haider failed to call witnesses who could have provided the court with an independent account of relevant events and circumstances in the proceedings;

(b)    Mr Basi failed to adduce evidence to the Court of hours and days worked as recorded in his mobile telephone app data between May and August 2018 (I return to this issue later in these reasons); and

(c)    Mr Basi and Mr Haider made no effort to provide any detailed or specific evidence of their work hours, instead relying on a blanket 12 hours per day, six days per week (even to the extent, when proceedings were contemplated, of recording details which would then have been recent memory).

212    Whilst it may be acceptable to plead in such general terms, the respondents submit that in order to engage the benefit of s 557C of the FW Act, the applicants must set out the best possible specific evidence to support the general pleading. The respondents submit that the applicants have made no effort to provide details of specific starting or finishing times, even within the last month or so of their employment.

213    The respondents have admitted in their defences to contraventions of the requirements to keep records, including accurate payslips, but the admission did not extend to a failure to keep overtime records. The respondents deny there was any overtime worked by Mr Basi or Mr Haider and say there were therefore no records to keep.

214    In light of the above, and in reliance on the obiter reasoning in Ghimire, the respondents submit the applicants have not made a reasonable and bona fide claim and, despite the respondents’ failure to keep records pursuant to ss 535 and 536 of the FW Act, they submit that the applicants should not be entitled to rely on s 557C of the FW Act to reverse the burden of proof.

215    The applicants submit, and I accept, that the approach taken by the respondents to s 557C of the FW Act would in effect make the section largely nugatory in practice. They submit that the purpose of the section is not to allow an employer to benefit from its own failure to maintain appropriate records in defending a claim for contravention of the FW Act. The applicants submit that the respondents’ complaint is essentially that the applicants’ evidence is insufficiently specific but that, they argue, is the very contention that s 557C seeks to preclude an employer from making.

216    The applicants further submit that it is not evident what further specific evidence might be required in addition to the evidence that the applicants have given as to the pattern of work that they performed for the respondents.

217    I do not accept the respondents’ submission that the claims advanced by Mr Basi and Mr Haider as to their hours of work are not bona fide nor reasonably made. Both were employed pursuant to employment offer letters that stipulated that they were being employed on a full time basis and although their commencement dates were disputed, there was no suggestion that they did not work at the Restaurants for Namitha Nakul for material periods.

218    I have therefore approached the questions concerning the hours that Mr Basi and Mr Haider worked for Namitha Nakul and other aspects of their employment addressed by the Award the subject of the alleged civil remedy contraventions on the basis that the applicants have the benefit of s 557C of the FW Act.

What were the hours of work performed by Mr Basi and Mr Haider at the Restaurants?

Submissions

219    The applicants submit that the Court should accept the evidence of Mr Basi and Mr Haider that they worked between about 9.30 am and 10.00 pm, or later, at the Restaurants on Tuesday to Sunday each week. The applicants rely on the failure of the respondents to comply with their obligations to keep records of overtime worked and to issue payslips pursuant to s 557C to reverse the onus of proof, thus requiring the respondents to disprove the hours of work alleged to have been worked by Mr Basi.

220    The applicants submit that it is illogical that the respondents:

(a)    would engage experienced and skilled persons such as Mr Basi and Mr Haider, and not avail themselves of those skills; and

(b)    would pay Mr Basi and Haider so much more than the law requires if they were in fact performing the work for the hours claimed by the respondent.

221    The applicants also sought to rely on the evidence of the hours worked by Ms Kumar as the Head Chef at the Wollongong Restaurant, typically arriving between 11.00 am and noon and working until 10.00 pm, with a break between 2.30 pm and 3.30 pm, from Tuesday to Sunday, as corroborating the hours claimed to have been worked by Mr Basi and Mr Haider. In addition, each of Mr Usha, Mr Sulatha and Ms Sujith gave evidence that they worked in the Restaurants from Tuesday until Sunday. Mr Usha gave evidence that over the period between April 2016 and July 2019, the Wollongong Restaurant was open between noon and 10.00 pm, Tuesday until Sunday.

222    The respondents submit that Mr Basi generally worked between 5.30 pm and 9.30 pm at the Wollongong Restaurant and between 5.00 pm and 9.00 pm at the Nowra Restaurant, and Mr Haider generally worked between 12.00 pm and 2.30 pm at the Nowra Restaurant.

223    The respondents submit that the hours alleged to be work by the applicants are inherently implausible given the evidence of Mr Usha, Ms Kumar, Mr Sulatha and Ms Sujith, the EFTPOS records for the Nowra Restaurant that revealed only 0.2% of transactions at the Nowra Restaurant occurred before 11.30 am and only 5% of transactions at the Nowra Restaurant occurred after 9.30 pm, and the limited amount of food preparation required at the Nowra Restaurant.

Evidence

224    Mr Usha gave evidence that Mr Basi typically worked during his employment with Namitha Nakul from:

(a)    5.30 pm to 9.30 pm at the Wollongong Restaurant between 16 November 2016 and 27 March 2017; and

(b)    5.00 pm to 9.00 pm at the Nowra Restaurant between April 2017 and July 2018.

225    Mr Usha’s evidence as to the hours that Mr Basi worked at the Wollongong Restaurant from March 2017 was corroborated by the evidence of Ms Kumar and at the Nowra Restaurant in the period from September 2017 by the evidence of Mr Sulatha and Ms Sujith.

226    Mr Usha gave evidence that Mr Haider typically worked during his employment with Namitha Nakul:

(a)    the dinner shift (5.30 pm to 9.30 pm) at the Wollongong Restaurant between 28 March 2017 and May 2017;

(b)    from 12.00 pm to 2.30 pm (Wednesday to Sunday) at the Nowra Restaurant between May 2017 and 25 March 2018, except in July 2017 where he also worked the dinner shift (5.00 pm to 9.00 pm) while Mr Basi was on leave;

(c)    either the lunch shift (12.00 pm to 2.30 pm) at the Nowra Restaurant or the dinner shift (5.30 pm to 9.30 pm) at the Wollongong Restaurant between 27 March 2018 and 3 June 2018; and

(d)    both the lunch shift (12.00 pm to 2.30 pm) and the dinner shift (5.30 pm to 9.30 pm) at the Wollongong Restaurant between 5 June 2018 and 14 August 2018.

227    Mr Usha’s evidence as to the hours that Mr Haider worked at the Wollongong Restaurant was substantially supported by the evidence of Ms Kumar, and his evidence as to Mr Haider’s hours at the Nowra Restaurant in the period from September 2017 was supported by the evidence of Mr Sulatha and Ms Sujith. I note, however, that Mr Usha’s evidence that Mr Haider worked only Wednesdays to Sundays from 12.00 pm until 2.30 pm at the Nowra Restaurant is not supported by the evidence of Mr Sulatha or Ms Sujith. Both simply describe Mr Haider working the “lunch shift”, and they do not exclude Tuesday from the days that Mr Haider worked at the Nowra Restaurant.

228    The EFTPOS records for the Nowra Restaurant reveal that in the period from 9 May 2017 to 11 April 2019:

(a)    only 5% of transactions occurred after 9.30 pm (with the latest transaction being at 10.45 pm); and

(b)    only 0.2% of transactions occurred before 11.30 am.

Payslips

229    The payslips issued by Namitha Nakul to Mr Basi (Basi payslips) and to Mr Haider (Haider payslips) are not a reliable record of the actual hours worked by either Mr Basi or Mr Haider.

230    The Basi payslips for the period 7 November 2016 to 15 July 2018 record that Mr Basi worked “Ordinary Hours” of 76 hours each fortnight at an hourly rate of $27.83.

231    The Basi payslips are consistent with the Basi Employment Offer, in that the employment was full time, namely 38 hours a week (as stipulated by the Award). They are not consistent, however, with the positions sought to be advanced by either the applicants or the respondents in the proceedings as to the hours that Mr Basi actually worked at the Restaurants.

232    The Haider payslips for the period:

(a)    27 March 2017 to 9 April 2017 record that Mr Haider had an annual salary of $8,320 payable fortnightly in a gross and an after tax amount of $320 and worked 20 hours each fortnight at an hourly rate of $16;

(b)    10 April 2017 to 2 July 2017 record that Mr Haider had an annual salary of $8,320 payable fortnightly in a gross and an after tax amount of $640 and worked 40 hours each fortnight at an hourly rate of $16;

(c)    3 July 2017 to 17 July 2017 record that Mr Haider had an annual salary of $8,320 payable fortnightly in a gross and an after tax amount of $320 and worked 20 hours each fortnight at an hourly rate of $16;

(d)    17 July 2017 to 25 March 2018 record that Mr Haider had an annual salary of $8,856 payable fortnightly in a gross and an after tax amount of $340.60 and worked 20 hours each fortnight at an hourly rate of $17.03;

(e)    26 March 2018 to 15 July 2018 record that Mr Haider had an annual salary of $39,955 payable fortnightly in a gross amount of $1,536.72 and an after tax amount of $1,214.72 and worked 76 hours each fortnight at an hourly rate of $20.22; and

(f)    16 July 2018 to 14 August 2018 record that Mr Haider had an annual salary of $39,955 payable fortnightly in a gross amount of $1,536.72 and an after tax amount of $1,332.72 and worked 76 hours each fortnight at an hourly rate of $20.22.

233    In summary, the Haider payslips record him working 10 hours each week between 27 March 2017 and 9 April 2017, 20 hours each week between 10 April 2017 and 2 July 2017, 10 hours each week between 3 July 2017 and 25 March 2018, and 38 hours each week from 26 March 2018 to 14 August 2018.

234    The Haider payslips, unlike the Basi payslips, do not even purport to reflect the terms of the employment offers made by Namitha Nakul from the date of receipt of the Department’s approval of Namitha Nakul’s sponsorship. The respondents received approval from the Department on 19 October 2017 but it was not until 26 March 2018 that the payslips recorded Mr Haider working full time and then only at an annual salary of $39,955, notwithstanding that the Department’s approval had been obtained on the basis of an annual salary of $55,000. I note, however, that Mr Haider’s application for a subclass 457 visa was ultimately rejected by the Department on 16 August 2018.

235    Moreover, the Haider payslips record Mr Haider only working 10 hours each week in July 2017. This was only half the hours recorded for each week between 10 April 2017 and 2 July 2017. This reduction in recorded hours is inexplicable given Mr Usha’s evidence that when Mr Basi was in India for his wedding in July 2017, Mr Haider worked both the lunch and the dinner shifts at the Nowra Restaurant.

Where was the food served at the Nowra Restaurant prepared?

236    A significant aspect of the respondents’ challenge to the hours that Mr Basi and Mr Haider claimed they worked was the extent to which, on the respondents’ case, much of the food served at the Nowra Restaurant was substantially prepared in advance at the Wollongong Restaurant and then transported to Nowra, in part due to Mr Basi’s alleged limited cooking skills.

237    Ms Kumar gave evidence that:

All food for the Nowra restaurant, except dosa and rotti was cooked at the Wollongong Restaurant and delivered to the Nowra Restaurant as required by either myself and Vaisakh or the Fourth Respondent (Sujith)

238    Ms Kumar conceded in cross-examination that the statement was, at the very least, incorrect in respect of the prawn dishes and the onion bhajis.

239    Counsel for the applicants, Ms Doust, somewhat colourfully submitted in her closing written submissions, in response to the evidence of Ms Kumar, that:

The arrangement apparently involved 10 kilogram buckets of half-cooked chicken (“The chicken was half-cooked and then transported from Wollongong down to Nowra. Is that what you’re saying?---Yes.” [T.580.20]) and rice-based dishes such as biryani [see, e.g. Ms Sujith at T593.30] wending their way down the Princes Highway to Nowra over an hour away by car after having been left to cool in Wollongong.

Consideration

240    The fundamental tension in the case advanced by the respondents is that they are seeking to advance a case that Mr Basi and Mr Haider only worked part time at the Restaurants, generally only worked a lunchtime or a dinner shift and performed duties not much beyond what could be expected from a kitchen hand, but at the same time they contend that they agreed to sponsor each of them as full time cooks and, at least with respect to Mr Basi, purported to pay him on that basis for the whole period of his employment by Namitha Nakul. This difficulty is compounded by the extent to which Mr Usha and Ms Kumar gave evidence of the limited cooking skills of Mr Basi and Mr Haider, and Mr Basi’s poor attitudes as employees.

241    At the same time, the evidence given by Mr Usha, to the extent that it is supported by the evidence of Ms Kumar, Mr Sulatha and Ms Sujith and the objective evidence of the revenue generated by the Nowra Restaurant and the ad hoc manner in which Mr Usha operated the Restaurants, particularly with respect to his lack of compliance with regulatory requirements, casts significant doubt on the hours of work that Mr Basi and Mr Haider claim to have worked for Namitha Nakul.

242    It is difficult to reconcile the conflicting evidence relied upon by the applicants and the respondents concerning the number of hours worked by Mr Basi and Mr Haider. Much of that difficulty arises because of the manner in which the respondents conducted their businesses at the Restaurants.

243    The Restaurants were operated as family businesses with little attention being given to creating and maintaining accurate employment records that might have provided an objective contemporaneous record of the hours worked by Mr Basi and Mr Haider.

244    I am not satisfied, however, given the evidence of Mr Usha, to the extent that it is supported by Ms Kumar, Mr Sulatha and Ms Sujith, that Mr Basi or Mr Haider worked, on average, more than 38 hours per week or for more than five hours at any one time, given the relatively limited duration of the lunch and dinner shifts at the Restaurants, the dependence by the respondents on family and household members undertaking work at the Restaurants, the limited business generated, by at least the Nowra Restaurant, the very limited transactions at the Nowra Restaurant for the lunch shift prior to 11.30 am and the dinner shift after 9.30 pm, and the extent to which the food served at the Nowra Restaurant was prepared by Ms Kumar in the Wollongong Restaurant.

245    I am satisfied that this evidence, when weighed against the generalised evidence given by Mr Basi and Mr Haider of the extreme hours that they worked at the Restaurants, is sufficient to discharge the onus placed on Namitha Nakul by reason of s 557C of the FW Act with respect to the 12 hour, six day a week claims advanced by the applicants.

246    I am not persuaded, however, that the hours of work undertaken by Mr Basi and Mr Haider were as narrowly confined as claimed by Mr Usha and in more general terms by Ms Kumar, Mr Sulatha and Ms Sujith. Further, given the informal manner in which the Restaurants were operated, I do not accept that the hours worked by Mr Basi and Mr Haider were limited to the lunch and dinner shifts.

247    I accept, given the evidence of Ms Kumar, Mr Sulatha and Ms Sujith, that on some occasions, Mr Basi and Mr Haider might only have worked a lunch or a dinner shift at the Nowra Restaurant but I find, consistent with the apparent logic of events and the facts capable of being objectively established, that this was very much the exception not the rule.

248    Moreover, irrespective of the actual hours that they might have been required to work in practice, I am satisfied, consistently with their respective offer letters, that each was employed by Namitha Nakul on a full time basis. Although Mr Haider did not receive the Haider Employment Offer until the end of May 2017, I am satisfied that he was effectively working on a full time basis in the Nowra Restaurant from 31 October 2016, an inference that I am more confident in drawing in the period between 31 October 2016 and 31 March 2017 by reason of the failure of the respondents to call Ashik or to explain his absence.

249    The respondents submit the failure by Mr Basi to adduce the data from a Fair Work Ombudsman mobile app that he had on his mobile telephone on which he had recorded the hours that he worked from around May or June 2018 at the Nowra Restaurant is sufficiently unexplained to allow the Court to draw the inference that the evidence would not have assisted Mr Basi’s case (and in particular that he did not work the claimed 12 hours each day, six days per week during the period of his employment by Namitha Nakul). Mr Basi gave evidence that he had provided the work hours recorded on the app to Mr Arthur Rorris, the secretary of the South Coast Labour Council, but on ceasing employment with Namitha Nakul he had deleted the app from his mobile telephone. When pressed in cross-examination as to why he had deleted the app, Mr Basi responded:

I was expecting my 489 visa and I want to move away from there, that’s it.

250    Given the quantum of the claim that he was making against the respondents, the explanation for the deletion is difficult to accept. In a letter from the South Coast Labour Council, signed by Mr Rorris, to the respondents dated 31 July 2018, Mr Basi demanded payment of an amount of approximately $227,000 by reference to the hours that he claimed to have worked at the Restaurants. The data on the app could reasonably be expected to have had considerable evidential value in substantiating that claim. The receipt of a 489 visa would not have otherwise assisted Mr Basi in pursuing a claim for that very significant quantum of money. It is implausible that Mr Basi did not appreciate the significance of the app data to the claim that he was making against the respondents at the time that he deleted it.

251    The rule in Jones v Dunkel also applies to the failure by a party to tender documents: see Burke v LFOT Pty Limited (2002) 209 CLR 282; [2002] HCA 17 at [134] (Callinan J); Challenger Property Asset Management Pty Ltd v Stonnington City Council (2011) 34 VR 445; [2011] VSC 184 at [124]-[131] (Croft J).

252    In all the circumstances, I accept that the failure by Mr Basi to adduce the app data from his mobile telephone, by reason of his decision to delete it, was not sufficiently explained so as to preclude me from drawing an inference that it would not have assisted Mr Basi’s case and I have therefore, in the case of Mr Basi, more confidently found that he did not work the claimed 12 hour days, six days a week while he was employed by Namitha Nakul.

Were Mr Basi and Mr Haider afforded the breaks required by the Award when working for Namitha Nakul at the Restaurants?

253    Mr Basi gave evidence that there were no set times for breaks while he was working for Namitha Nakul. He stated that on occasions Mr Sulatha or Ms Sujith would tell him to take a break for food, but he maintained that he remained on call during his break and was required to return to the Nowra Restaurant if an order was placed.

254    The applicants submit that before Mr Basi commenced working with him, Mr Haider did not have any breaks. They submit that other than on a few occasions, the Nowra Restaurant remained open throughout the afternoon, and Mr Haider and Mr Basi were not allowed to refuse any orders. At best, they submit, Mr Haider and Mr Basi could sit outside on Tuesdays, Wednesdays and Thursdays, but subject to them remaining in the close vicinity of the restaurant.

255    In the absence of positive evidence that demonstrated that Namitha Nakul afforded them the breaks required, the applicants submit that the Court would accept their evidence that they were not given proper breaks. They submit that whilst while they may have been permitted to eat or sit down this does not ameliorate the objective seriousness of the contravention and that a period of rest which is subject to recall, and requires the employee to remain at the premises, is not in fact a break.

256    Mr Basi was cross-examined at length in relation to breaks at the Restaurants. Mr Basi claimed to have been given “no break at all” while working for Namitha Nakul but later agreed he would sit on the floor to have his lunch. However, Mr Basi maintained that this could not be classified as a break. He stated there was consistently lots of work to do, including things such as preparation of dough for the following day and other jobs including checking groceries and cleaning.

257    Mr Sulatha and Ms Sujith gave evidence of telling Mr Basi to take a break and have something to eat when the restaurant was quiet.

258    The respondents submit that given Mr Basi and Mr Haider were in truth only required to work at most four hour shifts that the issue of breaks required by the Award did not arise.

259    I accept that on occasions Mr Basi and Mr Haider may have carried out tasks between the lunch and dinner shifts but I am satisfied that these tasks were relatively limited and irregular given the ad hoc manner in which Mr Usha conducted the Restaurants and that his family members and Ms Kumar were more likely to have undertaken these additional tasks during those periods given their greater ties and apparent commitment to Mr Usha.

260    I am satisfied that Mr Basi and Mr Haider were not provided with breaks at set times but I am also satisfied, given my findings above, that Mr Basi and Mr Haider would rarely, if ever, had to work more than five hours without a break. The Restaurants had distinct and limited opening hours for lunch and dinner shifts of much less than five hours duration, much of the food for the Restaurants was prepared in advance by Ms Kumar and the trading results of the Restaurants, particularly the Nowra Restaurant, established that the Restaurants were trading relatively slowly and ultimately were both closed down. The Award obligation to give an employee a break only arises where an employee works for five or more hours.

What duties did Mr Basi and Mr Haider perform?

261    The scope of the duties performed by Mr Basi and Mr Haider for Namitha Nakul at the Restaurants was the subject of much conflicting evidence.

Evidence

262    Mr Basi gives evidence that he was responsible for turning on machines, grinding rice for dosa batter, boiling potatoes, making dough, preparing gravies and sauces, chopping onions and other vegetables, preparing dosa batters and cutting and cooking meats. Mr Basi did not draw any distinction in his written evidence between his duties at the Wollongong Restaurant and the Nowra Restaurant.

263    Mr Basi accepted during cross-examination that some stock items were delivered “pre-prepared” such as the dosa batter (as the Nowra Restaurant did not have a rice grinder) but otherwise maintained that the balance of the groceries which were delivered were uncooked and prepared by him (or Mr Haider) in Nowra.

264    Mr Haider gives evidence of being responsible for preparation, cooking and service of dishes and meals, training another person (without experience), preparation and safe use of the tandoori oven, cleaning the kitchen and restaurant before and after service, ordering food from Mr Usha and stock control, collection of bulk food and stores, occasional deliveries and letterboxing flyers. On the basis that the tandoori oven was removed after the renovations undertaken by Namitha Nakul in March 2017, this list appears to refer to the period before Mr Basi commenced working at the Nowra Restaurant.

265    Mr Haider and Mr Basi agreed that once Mr Basi began working at the Nowra Restaurant they shared all the responsibilities for doing kitchen work, with Mr Basi stating he was in charge of the kitchen.

266    In cross-examination Mr Haider clarified the extent of the work he undertook in the preparation and cooking of dishes and meals. Mr Haider confirmed that he was not good at cooking dosa from batter, he had not cooked a dish called kallappam and he had only tried cooking sambar vada but never made it alone, and he had never made ulunda vadai. He stated, however, that he had observed Mr Basi making each of those dishes, and assisted him in preparing them.

267    Mr Usha, Ms Kumar, Mr Sulatha and Ms Sujith gave evidence that the majority of the food served at the Nowra Restaurant was cooked at the Wollongong Restaurant, and delivered each week by Mr Usha and Ms Kumar on Mondays and then additional food was delivered by either Mr Usha or Mr Sulatha (and Ms Sujith) when required.

268    Ms Kumar and Mr Sulatha conceded that some items, such as prawns and the onion bhajis, needed to be cooked in the Nowra Restaurant.

269    Ms Kumar gave evidence that the curries were cooked in Wollongong, delivered to Nowra and if they were not sold within two days it would be taken home to be consumed by the 11 people living with Ms Kumar and Mr Usha. This practice was supported by the report prepared by Ms Csanitz.

270    Mr Usha and Ms Sujith otherwise gave evidence that the duties performed by Mr Basi were relatively limited and his skills did not demonstrate an ability to run a commercial kitchen.

271    Mr Usha and Mr Sulatha each gave evidence that Mr Haider’s responsibilities were limited to placing food in warmers, undertaking general pantry duties and arranging food for service.

Consideration

272    I accept that it is necessary to distinguish between the skills an employee may have and the work that was in fact undertaken by an employee.

273    I also accept Ms Kumar’s evidence that much of the food served at the Nowra Restaurant was “precooked” at the Wollongong Restaurant. I consider that this was primarily directed at the preparation of the curries and sauces that served as the bases for the dishes served at the Nowra Restaurant and some “precooking” of meat and vegetables. I am satisfied, however, that a not immaterial amount of work was required to be undertaken at the Nowra Restaurant before the food was ready to be served to customers. In particular, I do not accept that it was simply a matter of heating up the food in a microwave or in a saucepan on a hot plate.

274    Ms Kumar was not physically present in the Nowra Restaurant. One or both of Mr Basi and Mr Haider, at least in the period prior to the arrival of Ms Sujith, were the only cooks working in the kitchen of the Nowra Restaurant. Mr Usha may have been present in the kitchen from time to time prior to the arrival of Ms Sujith but it would appear that Mr Usha was performing the role of Restaurant Manager of the Nowra Restaurant during that period. Further, I note that Mr Usha in his affidavit evidence only states that Ms Sujith from September 2017 “often also worked in the Nowra Restaurant”.

275    Further, in considering the apparent logic of events, as the applicants submitted:

The respondent asks the Court to accept that two people with extensive experience in the restaurant industry elected to launch a new restaurant, offering food cooked elsewhere and reheated, with all of the attendant logistical difficulties and ever-present risk of food-poisoning involved in that course, rather than to terminate an unsatisfactory staff member and engage staff capable of cooking meals to order on site. The only logic that dictates such an approach is one conceived of in hindsight, and dictated by imperative to deny that the only qualified cooks working at the Nowra restaurant other than Mr Basi and Mr Haider, were in fact performing the work they [Mr Basi and Mr Haider] were qualified and engaged to perform.

276    In the circumstances, I do not accept that the work undertaken by Mr Basi and Mr Haider, particularly at the Nowra Restaurant, was limited to duties undertaken by kitchen hands. Rather, I am satisfied that the work that they undertook included work that involved the utilisation of substantive cooking skills.

What is the appropriate Award classification for the employment of Mr Basi and Mr Haider by Namitha Nakul?

277    Relevantly for present purposes, the distinctions in the Award, between a Cook Grade 3 and a Cook Grade 5, is a Cook Grade 3 is a chef who has completed the appropriate level of training and who is engaged in cooking, whereas a Cook Grade 5 is a chef with the appropriate level of training and who performs any of the following:

(a)    general and specialised duties including supervision or training of other kitchen staff;

(b)    ordering and stock control; and

(c)    solely responsible for other cooks and other kitchen employees in a single kitchen establishment.

278    The extension to “specialised cooking” and supervision and training of other cooks is also included in the definition of a Cook Grade 4.

279    The applicants submit that the work performed by Mr Basi at both restaurants aligns (at least) with Cook Grade 4, and aligns with Cook Grade 5 when he worked in the absence of a cook senior to him.

280    The respondents submit that despite Mr Basi alleging to have skills which would classify him at a more senior level, the work he actually undertook while employed by Namitha Nakul is best classified as a Cook Grade 3.

281    In his written evidence, Mr Basi states he was originally employed at the Wollongong Restaurant as the Head Chef, a role which Mr Basi admits was taken over by Ms Kumar when she commenced working at the Wollongong Restaurant.

282    Mr Basi also gave evidence he was the Head Chef or “in charge of the kitchen” while working at the Nowra Restaurant. Mr Haider conceded in cross-examination that he did not cook anywhere near as extensively as Mr Basi and in fact lacked the skills to cook many dishes including dosa, ulundu vadai, kallappam and sambar vada.

283    Mr Usha, Ms Kumar, Mr Sulahta and Ms Sujith give evidence that Mr Basi and Mr Haider were always supervised and worked at the direction of Mr Usha, Ms Kumar or Ms Sujith.

284    Namitha Nakul’s solicitors, Maguire & McInerney, however, in their letter to the South Coast Labour Council dated 4 September 2018, stated:

We refer to the identified base rate of pay and observe that this was at all times sufficient to meet the minimum rate for a Level 4 employee under the Award.

Our view and that of our client is that this classification was appropriate and applied at all times to Mr Basi when working at the Wollongong restaurant.

…

The payment to be made to Mr Basi on termination is set out in the attached schedule and comprises an amount of $1,205.61 (gross) less applicable tax based on a base rate of pay of $23.42 per hour for a Level 5 employee.

…

We have formed a view, which is accepted by our client, that for all the work performed at the Nowra restaurant Mr Basi should have been paid at a Level 5 employee rate.

285    It is telling that despite the sustained attempt by the respondents to contend that Mr Haider’s duties never extended beyond that of a kitchen hand, the statement that Mr Usha requested Mr Haider sign in response to Mr Basi’s allegations included the following representation:

I commenced working at the restaurant as an apprentice cook, but I finished my Hospitality Management Course approximately one year ago and I now have a Certificate 3 confirming that qualification. Consequently, I am employed in the Nowra restaurant as a cook, Level 4.

286    I am satisfied, having weighed the conflicting evidence given by the applicants and the witnesses relied upon by the respondents, that the duties performed by Mr Haider fell somewhere between a Cook Grade 3 and Cook Grade 4 classification but closer to a Cook Grade 4 classification, and the duties performed by Mr Basi at the Wollongong Restaurant fell within a Cook Grade 4 classification and at the Nowra Restaurant were equivalent to a Cook Grade 5 classification under the Award. Each had completed an apprenticeship by reason of their past experience and had obtained a trade qualification (Certificate III in Commercial Cookery), was clearly engaged in “cooking duties” and Mr Basi, at least, by reason of his preparation of dosa batters and Mr Haider’s observations of the dishes that he prepared, was engaged in general or specialised cooking duties. Further, given that Ms Kumar worked at the Wollongong Restaurant, Mr Basi in a practical sense “supervised” Mr Haider on a day to day basis.

Did Namitha Nakul arrange the hours of work of Mr Basi and Mr Haider in a way that contravened the Award?

287    Namitha Nakul was required by clause 31 of the Award to arrange ordinary hours of work so that:

(a)    there was a minimum of six hours and a maximum of 11 and a half hours to be worked on any one day (cl 31.2(a));

(b)    no employee was rostered to work for more than 10 hours per day on more than three consecutive days without a break of at least 48 hours (cl 31.2(b));

(c)    no more than eight days of more than 10 hours may be worked in a four week period (cl 31.2(c)); and

(d)    every employee was be given a minimum of eight full days off per four week period (cl 31.2(e)).

288    The applicants submit that Namitha Nakul did not do so. They contend that as a matter of its normal practice, it required Mr Basi and Mr Haider:

(a)    to work 12 hours in a day;

(b)    to do so for six days in a row for most of their employment;

(c)    to work 24 days of more than 10 hours in a four week period (that is, 16 ten hour days greater than the maximum allowed by the Award clause over a four week period); and

(d)    to have only four days off in a four week period, four days off less than the minimum of eight days off.

289    The applicants submit that the arrangement of hours that they allege they worked is largely consistent with the arrangement of Ms Kumar’s hours of work.

290    For the reasons outlined above I have accepted that Mr Basi and Mr Haider were employed on a full time basis, that each was required to worked at least a single shift of four hours each day between Tuesday and Sunday but the applicants did not work more than a 38 hour week.

291    I am satisfied that Namitha Nakul contravened clause 31.2(e) of the Award by only giving Mr Basi and Mr Haider four days off in a four week period rather than the stipulated eight days.

292    Further, I find that because the applicants were employed on a full time basis by Namitha Nakul, clause 31.1 of the Award required Namitha Nakul to pay the applicants on average for 38 hours a week and by clause 31.2(a), Namitha Nakul was required to arrange their ordinary hours of work each day so that each worked a minimum of six hours over the course of the day. As the applicants were required to work each day of the week from Tuesday to Sunday, for the purpose of calculating penalty rates for work on weekends, Namitha Nakul was consequently required by clause 31.2(a) to ensure that each of the applicants worked a minimum of six hours on both Saturday and Sunday.

293    The other alleged contraventions of clause 31 of the Award have not been established.

What did Namitha Nakul pay Mr Basi for his work?

294    The respondents were obliged, by s 536(2)(b) of the FW Act to give Mr Basi a payslip that included any information prescribed by the FW Regulations. Regulation 3.46(3) required the payslip to include, inter alia:

(a)    the hourly rate;

(b)    the number of hours for which the employee was employed at that rate; and

(c)    the amount of the payment made at that rate.

295    Mr Usha gave evidence that he did not keep proper records in relation to Mr Basi’s employment. He accepted in cross-examination that he did not always pay Mr Basi correctly and that his bank statements were not an accurate record of the amount Mr Basi had been paid.

296    Mr Basi gave evidence that he was paid a total of $76,417.78 by Namitha Nakul comprising:

(a)    $32,113.42 in the 2016/2017 financial year;

(b)    $34,916.22 in the 2017/2018 financial year; and

(c)    $9,388.14 in the 2018/2019 financial year.

297    The respondents submit that in the circumstances the best evidence before the Court of what Mr Basi was paid is Mr Basi’s personal bank statements. They contend, however, that this establishes that Mr Basi received $76,417.78, after tax, during his employment with Namitha Nakul, a matter that they submit they are prepared to concede in order to simplify the proceedings.

298    The determination of the amount that was in fact received by Mr Basi, however, turns upon a consideration of what, if any, payments Mr Basi was required to pay back to Namitha Nakul. I return to this issue later in these reasons.

Did Namitha Nakul pay Mr Basi the amount payable to him pursuant to the Award for the work he performed?

Prior to 15 November 2016

299    It is necessary first to consider the position in the period to 15 November 2016.

300    In the period prior to the Department approving Namitha Nakul’s sponsorship of Mr Basi on 15 November 2016, Mr Basi was only paid $600 in cash per week. The regular cash deposits Mr Basi made into his account in the period from July 2016 are consistent with him receiving cash in the order of $600 on a regular basis during that period.

301    Mr Basi gave evidence that he was given a copy of the Basi Employment Offer that provided for an annual salary of $55,000 but in his initial discussions with Mr Usha he was told:

Ok, I can hire you, but I can only pay you $600 per week at the beginning because it is a new restaurant. I will pay your super. You will have to pay your tax but you can get it back at the end of the year. Once it gets more business and customers I can pay the full amount. Most restaurants ask for thirty thousand or forty thousand dollars for the sponsorship. You don’t have to pay that.

302    Mr Basi stated that the $600 per week arrangement was presented by Mr Usha as a temporary departure from what was accepted to be “the full amount”. I am satisfied that in its terms the language used by Mr Usha comprehends an obligation on his part to pay a greater amount consistently with the Basi Employment Offer, being an obligation that would ultimately be honoured. It is not exceptional that Mr Basi would accept something less than his legal entitlement during this period, given Mr Usha had referred to existing difficulties but spoke to a better future and promised the situation would only be temporary. Mr Basi’s circumstances were at that stage far from ideal. He had recently arrived in Australia and had to find a new employer to sponsor his 457 visa because Chellappas had withdrawn its sponsorship of him because of financial difficulties.