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Business news, business advice and information for Australian SMEs | SmartCompany

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    A Melbourne business owner has agreed to reimburse a Nepalese woman $23,000 after she claimed she was underpaid because she was “not an Aussie”.

    The international student worked at the Health Express takeaway store at DFO South Wharf and was paid as little as $12 an hour, according to the Fair Work Ombudsman.

    The 27-year-old told the Ombudsman her boss made it clear he was paying her less than other employees because she was an overseas worker.

    Read more: Australian employers offering “black jobs” to overseas workers at below legal rates

    “When I came for the interview, he said that I will give you the job, but as you are not an Aussie, I will be paying you a lesser amount,” the woman told Fair Work inspectors.

    “It was really embarrassing for me. I had Australian friends who were doing the same kind of work, but were getting paid over $20 an hour.”

    The international student also alleges her boss threatened to cancel her visa if she told authorities about her wages.

    The Ombudsman found the worker was underpaid more than $23,000 between September 2013 and March 2015.

    In addition, after turning to the employer watchdog for help, the international student returned to Nepal for several weeks to look after her sick father.

    When she returned to Australia she discovered she had been removed from Health Express’s roster.

    When Fair Work inspectors investigated the matter they also found a second student had been underpaid more than $27,000.

    Jeffrey Herscu, the sole director of Rapid City, the company that operates Health Express, has agreed to back-pay the two former employees $50,000.

    Herscu has signed an enforceable undertaking, which requires him to apologise for his conduct and make a $5000 donation to the Western Community Legal Centre. 

    Fair Work Ombudsman Natalie James said in a statement business owners need to “get the basics right”.

    “It is important that there is a fair, competitive environment for employers who are doing the right thing by creating a level playing field in relation to business costs,” James said.

    “Employers simply cannot undercut the minimum lawful entitlements of their employees based on what they think the job may be worth, what the employee is happy to accept, what other businesses are paying, or what the job may pay in their country of origin.”

    Employment lawyer Peter Vitale told SmartCompany the Fair Work Ombudsman clearly has the protection of vulnerable workers at the top of its agenda.

    “This is a focus of their operations for the reason that young people, and in particular people from overseas, are in a vulnerable category of workers,” Vitale says.

    “As a result, a lot of the cases that are prosecuted involve people on working visas or student visas. The vast majority of employers do the right thing and the Ombudsman recognises that, but the message for people employing overseas workers – or any workers for that matter – is do your research and get advice… and make sure you’re paying the minimum wage.”

    SmartCompany was unable to contact Jeffrey Herscu for comment.


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    The Fair Work Commission has upheld an employer’s decision to sack a worker who the company claimed drunkenly threw his fully clothed colleague into a swimming pool at the work Christmas party.

    Damien McDaid, worked as project coordinator at Western Australia based engineering firm FEC, and had been employed since 2008.

    He brought an unfair dismissal claim before the Fair Work Commission, claiming his employer was at fault for providing alcohol at a work Christmas party in December 2014.

    However, personnel from FEC told the commission McDaid acted aggressively at the work function, was intoxicated and repeatedly poked a colleague in the chest before later throwing him into the pool without warning, an allegation which McDaid denied.

    Read more: Mechanic loses unfair dismissal bid after alleged outburst over Christmas party

    The commission heard tension had already been building between McDaid and his boss prior to the function, with his boss informing staff that all employees who had not completed their work would be left out of office Christmas festivities.

    McDaid attended work on the Saturday before to complete his work and the day prior to the party approached his boss over mounting tension.

    His boss said he was unhappy about am $84 petrol expenses claim Mr McDaid had made, which McDaid said he would put back onto his work credit card.

    The commission heard during the Christmas party, McDaid was asked to leave the event by his boss twice before the pool-throwing incident and following the incident, both men told each other to “fuck off”.  This led to another physical altercation between McDaid and his boss.

    The events of the Christmas party were later discussed during a series of meetings between McDaid and his managers, with McDaid’s employment terminated in March 2015

    Fair Work Commissioner Bruce Williams rejected McDaid’s unfair dismissal claim stating it was “not surprising” he was fired. He found the dismissal was neither harsh, unjust or unreasonable.

    “To his credit Mr McDaid did not attempt to use the fact that he had been drinking as an excuse for his conduct,” Williams said.

    “He did, however, criticise the employer generally for its actions in supplying the alcohol. Whilst in some circumstances an employer that provides alcohol at a work function and takes no steps to ensure it is consumed responsibly may be culpable for events attributable to the consumption of alcohol, such as a drunken employee being injured falling down stairs, employees who drink will also be held responsible for their own actions.”

    “The fact that someone has been drinking when they behave badly may in part explain their actions but it should not be accepted as an excuse for that misbehaviour. How much alcohol someone drinks is a choice they make and with that choice comes consequences.”

    “Society no longer readily accepts alcohol consumption as an excuse for bad behaviour and certainly not for physical violence,” he added.

    Workplace lawyer Peter Vitale told SmartCompany this morning conduct outside of the workplace, including Christmas parties, can be used by both an employer for disciplinary action and an employee for claims such as bullying or discrimination.

    “What this case really boils down to was that the employee’s conduct was so far outside the realms of what’s acceptable that the commission would’ve been very hard pressed to come to a different decision,” he says.

    Vitale advises SMEs to speak to staff prior to events like Christmas parties .

    “Before you hold any of these functions make sure all your employees understand the rules and what behaviour is expected of them,” he says.

    “Make sure that alcohol consumption is monitored. Make sure that adequate food, soft drinks are provided and make sure that employees have transport or accommodation arrangements.”

    SmartCompany was unable to contact FEC or McDaid for comment prior to publication.



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    Woolworths has been fined $102,000 by the consumer watchdog in Queensland for failing to include terms and conditions on vouchers that offered shoppers “20% off all meat purchases”.

    It’s a reminder to all Australian businesses that not informing consumers of all restrictions to a promotional offer can carry financial penalties.

    The Queensland Office of Fair Trading issued Woolworths with the civil penalty notice after investigating whether the vouchers, which were circulated via a mailbox drop to homes in Brisbane in early 2015, were misleading.

    According to the consumer watchdog, the voucher contained the phrase “20% off all your meat purchases”, however, the offer only applied to fresh meat from the Woolworths meat department and excluded frozen and deli meat.

    The Queensland Office of Fair Trading said as the vouchers did not qualify what type of meat would be discounted, this made it “reasonable to assume” the offer applied to all meat sold in store.

    Woolworths has since changed the terms of conditions of the voucher for any future promotions, adding the words “must be spent in one transaction on purchases from the Meat Department”.

    Brian Bauer, executive director of the Queensland Office of Fair Trading, said in a statement there is no evidence Woolworths was attempting to deliberately mislead shoppers. The payment of a penalty issued via a civil penalty notice is also not an admission that a business has contravened Australian Consumer Law.

    However, Bauer said Australian businesses “have a legal obligation to check and identify potentially misleading information before distributing it to consumers”.

    “Queensland consumers spend a significant percentage of their income in supermarkets and should be able to rely on the representations being made to them by both large and small retailers,” Bauer said.

    A spokesperson for Woolworths told SmartCompany this morning Woolworths acknowledges the fine issued by the Queensland Office of Fair Trading.

    “We apologise to our customers that the details of a meat promotion were unclear,” the spokesperson says.

    “Woolworths noted the issued quickly and changed the details of the offer in following week’s voucher.

    “We thank the Queensland Office of Fair Trading for their acknowledgment that Woolworths had no intention to deceive customers. We also not the amount of the fine is set by legislation.”


    Lessons for small businesses


    Businesses of all sizes can face financial penalties under the Australian Consumer Law if false or misleading representations are made about the price of goods.

    Narissa Corrigan, principal at Ampersand Legal, told SmartCompany this morning the overarching obligation for SMEs is to “make sure any offer isn’t misleading or deceptive”.

    This means ensuring any conditions are clear to the customer when the offer is made.

    Corrigan says this incudes things such as a start and end date to the promotion, any restrictions as well as if the customer must buy particular products or spend over a certain amount of money to qualify for the offer. This also applies to online coupons or offers.

    While Corrigan says some businesses do make offers that have no conditions, this is unusual. And she says most consumers will assume conditions apply to promotional offers.

    Nevertheless, the onus is on the business to communicate the conditions clearly.

    “It must be advertised in a way that is clear and obvious, so there is no doubt in the mind of consumers redeeming the offer,” she says. 


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    Often the decision to terminate an employee’s employment on grounds of misconduct will come as a result of repeated instances of inappropriate behaviour, rather than in response to an isolated and serious example.

    However, employers should be aware that they will not always be able to rely upon a pattern of behaviour in justifying the termination of an employee’s employment.

    Read more: Five lessons from some of the most important unfair dismissal cases of 2015

    In this article we consider in what circumstances (if any) an employer can rely on past behaviour in making the decision to terminate an employee. In particular, we consider whether the employer’s reliance on past behaviour is a relevant consideration for the Fair Work Commission in determining whether a termination is ‘harsh, unreasonable or unfair’ under the unfair dismissal regime established by the Fair Work Act 2009.


    Case 1: The importance of investigating serious incidents at work


    Mr Zeb Dewson v Boom Logistics [2012] FWA 9027

    In a 2012 decision of the then Fair Work Australia, Commissioner Ian Cambridge held that it was inappropriate for an employer to consider an earlier incident of misconduct in making its decision to terminate an employee for a further alleged incident of misconduct several months later.

    In that case, the employee, Zeb Dewson, had been involved in an incident where he had head-butted a co-worker during a work Christmas party in December 2010. No investigation of the incident was conducted at the time, though it had been brought to the attention of management. In April 2011, a different co-worker alleged that Dewson had assaulted him on-site on two separate occasions that month. After putting these allegations to Dewson, the employer formed an opinion that the two assaults did in fact occur and that these assaults, together with the head-butting incident, established a pattern of unacceptable misconduct warranting Dewson’s termination.

    Commissioner Cambridge considered the act of ‘head-butting’ a co-worker to be ‘indefensible’ and one that may have justified dismissal in and of itself.

    However, in the absence of any disciplinary action taken by the employer, he held that the incident could not be used to support the decision to later terminate the employee. This 2012 decision highlights how important it is for employers to investigate reported incidents of a sufficient degree of seriousness and cautions that a decision not to do so at the time may have repercussions for decisions made relating to that employee’s employment at a later date.


    Case 2: Past behaviour can be relevant if the employer responded at the time


    Joseph Johnpulle v Toll Holdings Ltd T/A Toll Transport [2015] FWC 3830; Toll Holdings Limited t/a Toll Transport, Toll Transport Pty Ltd t/a Toll Priority [2016] FWCFB 108

    The Full Bench of the Fair Work Commission has recently revisited the issue of an employer’s reliance on past behaviour in its decision of January 22, 2016, regarding the termination of Joseph Johnpulle.

    In that case the commission was asked, among other things, to consider whether the employer was justified in citing previous incidences of misconduct in a termination letter given to Johnpulle, particularly in circumstances where those incidences were significantly less serious than those triggering the decision to terminate and which had been previously settled ‘on the shopfloor’. Ultimately, the commission was asked to determine whether the existence of these previous incidences constituted a relevant ‘other matter’ which it was entitled to consider in determining whether the dismissal of Johnpulle was ‘harsh, unreasonable or unfair’.

    Johnpulle was dismissed after he was alleged to have made offensive comments about Islamic State and the Taliban to a colleague of Middle Eastern heritage on January 7, 2015. These comments, though more serious in nature, were similar to those that had been attributed to Johnpulle on three separate previous occasions. Johnpulle had previously been told to cease conversing with the colleague in this way, and had agreed to do so. No further action was taken regarding the previous comments, which were considered by the interested parties to have been ‘settled’ informally.

    At first instance, Commissioner Bernie Riordan found ‘going back to revisit settled disputes, issues and allegations to be inappropriate and unfair’ and was therefore at odds with the objects of the Fair Work Act.  He considered that the employer’s consideration of past behaviour ‘fail[s] the fair go test for an employee to be subjected to a form of double jeopardy in relation to conduct which has been dealt with previously by management.’

    On appeal, the employer submitted the Commissioner erred in finding that it was inappropriate and unfair to consider the previous incidents, especially in circumstances where the Commissioner had accepted that these incidents had in fact occurred and were similar to the conduct now complained of. The employer argued that the past behaviour of Johnpulle supported a conclusion that the dismissal was not harsh, unjust or unreasonable.

    Conversely, Johnpulle submitted it was well established that an employer who continued to employ an employee with knowledge of the employee’s misconduct cannot later rely on that misconduct to dismiss the employee. Johnpulle argued that reliance upon past behaviour was a relevant factor in making the dismissal harsh, unjust or unreasonable.

    The Full Bench agreed with Commissioner Riordan that the earlier instances of inappropriate behaviour were not in and of themselves a valid reason for dismissing Mr Johnpulle. However, the commission found that they were indeed relevant matters to consider in determining whether the dismissal was harsh, unjust and unreasonable. This was particularly so given that Johnpulle had persisted to make offensive comments despite being told to cease such behaviour and agreeing to do so. In this respect, the commission categorised the earlier instances of inappropriate behaviour as ‘not necessarily determinative’ but, as a ‘highly material consideration’ in relation to both whether the dismissal was unfair and the question of remedy.

    The matter has now been remitted to Commissioner Michelle Bissett for reconsideration.

    Lessons for employers

    1. If an incident of inappropriate behaviour and/or misconduct is reported to you, ensure that it is properly recorded and, if appropriate, investigated.
    2. A pattern of inappropriate behaviour is a relevant consideration in determining whether a dismissal is harsh, unjust or unreasonable but only in circumstances where the employer has proactively responded to and properly considered earlier instances of behaviour.
    3. ‘Proactively responding’ to an incident will depend on the nature of the incident, and includes by means of informal resolution between parties (i.e. a conversation between the alleged perpetrator and management).


    Ashleigh Mills is a workplace relations and safety lawyer at Holding Redlich.


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    Recent amendments to laws extending individual protections against unfair contracts to cover small business activity may miss the mark in protecting potentially vulnerable franchisees.

    Under the revised provisions, which will not come into force until November this year, there are two threshold levels. For contracts up to 12 months, the total upfront price should not exceed $300,000. For a longer contract, greater than 12 months, the upfront price should not be more than $1 million.

    According to the amendments, a small business owner will not be eligible for protection from unfair contract terms if the value of their agreement exceeds these limits during the specified timeframe. Contracts entered into before this date will not be affected.

    The initial purpose of the consumer-only protections was to ensure that those in an inferior bargaining position did not sign standard form contracts full of unfair terms.

    But the incoming legislation seems to have missed the mark for prospective and renewing franchisees, who instead of being protected by the amendments, may now find themselves in a more vulnerable position.

    Business format franchising, the most common form of franchised activity in Australia, is typically a long term contractual agreement lasting between one and 25 years. These contracts will therefore fall within the $1 million threshold. New and renewing franchisees will only be protected by the provisions if the total amount of the sign-on fee and other fixed amounts payable will not exceed $1 million during the term of the franchise agreement.

    While this amount may seem excessive, in a long-term business contract it is not the reality.

    To put it in perspective, let’s take a conservative hypothetical example and say that a new franchisee is signing on to a 10 year term. The theoretical initial franchise fee is $50,000. This would mean that the total amount of ongoing fees, fixed royalties, advertising fees, property lease fees and the renewal fee must be forecasted to be less than $95,000 per annum for the duration of the agreement. The inclusion of property lease fees alone seems to make this an unsuitable limit.

    This article serves as a warning to new and renewing franchisees that they need to be wary of the total forecasted value of their investment. There is no statutory requirement for franchisors to disclose whether the proposed agreement falls within the scope of the protections. What’s more franchisors may become incentivised to increase fees beyond the threshold levels.

    I would also like to draw attention to this seemingly irrational policy-making evident in the amendments. It is puzzling that a monetary value has been put on the point at which a small business person should be able to make the distinction between what are fair and unfair contract terms.

    How does an ability to finance a $1 million business make a small business person any less vulnerable? It seems a long leap to assume that the money used to finance a $1 million-plus business was earned in the course of doing business, thus making investor business savvy enough not to need protection.

    The average house price in Sydney is currently $800,000. This fact alone is evidence to suggest it would not be difficult for an inexperienced business person to borrow $1 million dollars and for them fall outside the scope of the protections.

    Is the law suggesting that small business people falling outside the limits have enough capital to pay for professional advice? If this was the case, wouldn’t it have been more appropriate to enforce a compulsory advisory clause where small business people are legally obliged to talk to expert lawyers and/ or accountants before signing on the dotted line?

    So where to from here? Undoubtedly the new legislation will face revision at some point in the short-mid term future. When this occurs I encourage small business people, in particular franchisees, to submit their concerns on the monetary thresholds.

    Business ownership and sector experience is an alternative measure for commercial savviness that could provide a better assessment and more sensible benchmark.

    The Conversation

    Courtenay Atwell, Casual Academic/ PhD candidate in Business Law, UNSW Australia

    This article was originally published on The Conversation. Read the original article.

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    A Sydney wine bar says it has been accused of “promoting unsavoury behaviour” because a blackboard listing its selection of wines was too close to the front of the restaurant and did not list any food.

    Italian wine bar 10 William Street posted a photo to Instagram over the weekend with a caption that said police said the business’s blackboard, which lists how much its drinks costs per glass, was “antisocial”.

    “So according to NSW POLICE FORCE our blackboard with what we are pouring by the glass is promoting unsavoury antisocial behaviour,” the business wrote.

    “Sydney, what the fuck is happening.”

    The post has since been liked more than 500 times and received more than 200 comments from people furious about how regulators are treating the city’s small businesses.

    Numerous restaurants and bars have shut down since the lockout laws came into effect and foot traffic in their areas has declined.

    “Complete nanny state,” one person wrote.

    “There is no real crime in running restaurants,” wrote another.

    “Police are here to keep us safe and to keep our community flourishing. The police are failing us if the only crime they can find in Kings Cross is a badly written wine list.” 

    Marco Ambrosino, co-owner of 10 William Street, told Broadsheet the police officers that visited the venue had two concerns.

    The first was about a sign that included the words “free wine”, which the business says refers to wine without added substances, and the second was the placement of the wine list, which the officers were concerned did not make it clear the venue also served food and therefore could promote heavy drinking.

    “We are a wine bar, so we put our wines by the glass at the front, and hand people a menu when they sit down. We’ve had it like this for six years,” Ambrosino said.

    In a statement to Broadsheet, NSW Police said 155 businesses and licensed premises were patrolled on Friday and Saturday nights as part of an operation across the Sydney City, Kings Cross, Surry Hills and Newtown areas.

    “It is common for police to provide advice to licensees regarding potential licensing breaches or issues during business inspections. Twelve breaches were detected during the operation,” the police said.


    “Not safe to operate your business anymore” says Freelancer founder


    Last week, Freelancer chief executive Matt Barrie wrote a scathing critique of the NSW government’s handling of liquor policy, saying the local lockout laws were destroying small businesses.

    Speaking to SmartCompany this morning, Barrie said what happened to 10 William Street over the weekend is the latest example of those in power having a “1950s moralistic view of the world”.

    “The main entertainment districts of Sydney now look like Detroit – completely wiped out,” Barrie says.

    “If you are a small business owner in the entertainment, hospitality or even restaurant industries, it’s simply not safe to operate your business anymore under the NSW Liberals.”

    Peter Strong, chief executive of the Council of Small Business of Australia, told SmartCompany everyone wants to see an end to alcohol-related violence, but punishing small businesses along the way is not the right way forward.

    “The issue here is you don’t stop violence by changing a blackboard menu,” Strong says.

    “The solution isn’t to be found in a blackboard or closing businesses, I would have thought. To say we’re going to stop violence by closing businesses down seems an odd one.”

    Strong says small businesses in Sydney that are feeling the pinch from the state’s liquor laws should contact their local MP or business group.

    “We need to make sure this is done properly,” he says.  

    SmartCompany contacted 10 William Street but did not receive a response prior to publication. 


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