The action is being taken against Sweets For You Pty Ltd, which operates a Donut King Franchise in a suburban Melbourne shopping plaza for allegedly applying duress to a 23-year-old employee to sign an Australian Workplace Agreement. Sweets For You is alleged to have threatened to significantly cut the workers hours when she refused — a threat that was allegedly carried out.

“Duress of any employee, especially to a young employee, to sign a workplace agreement is intolerable. Employers must be warned that they cannot contravene workers rights and that penalties may apply if they do not comply with workplace law,” workplace ombudsman Nicholas Wilson said.

Leigh Johns, chief counsel of the Workplace Ombudsman, told Lawyers Weekly that the use of litigation to promote compliance with the law is only a recent initiative of the agency. He explained that prior to becoming a statutory agency, the Office of Workplaces Services (as the agency was then known) litigated no more three matters a year — a marked contrast to the 100 matters that have been commenced in the last 21 months — and it’s been the result of a very deliberate shift in agency policy towards utilising litigation as a compliance tool.

“The public nature of litigation makes it an effective tool for deterring those who might otherwise disregard the law. It’s not about beating up on people who breach the law, what it is doing is sending a message to the community that we will not tolerate unfairness in workplaces and we will be an active cop on the beat to make sure that this isn’t occurring. What we hope to bring about is changes in people’s behaviour so that essentially we do ourselves out of a job,” he said.

And the change in tact has paid off. According to Johns the agency has been successful in all but one of the 38 matters that have been finalised to date, and more than $839,000 in penalties have been secured.

According to Johns, the issue the subject of the agency’s 100th claim — employees being the subject of duress in relation to AWAs — has been one of the agency’s key areas of concern.

“The duress matters often involve an employer saying to employees ‘take it or leave it’ and that is counter to what the law says about treating people fairly and providing them with an opportunity to negotiate the terms and conditions of their employment,” Johns said.

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However the vast majority of prosecutions (Johns estimates around 80 per cent) are in relation to claims of employees being underpaid. Johns explained that while SMEs are the primary targets of such complaints, it can sometimes be the result of a genuine error borne from the employer not having a dedicated or sophisticated human resources system.

“The agency is not out to prosecute employers who make a genuine mistake which they are prepared to remedy promptly,” Johns said.

“We’ve got a litigation policy that clearly sets out that we litigate those matters [which concern] the public interest. The matters we have been litigating have been those where the employees have been recalcitrant.

“Where they haven’t cared about what they owed their employees or they’ve been reckless in their obligation to be a good employer and we want to send a message that we can’t have that type of practice or unfairness in Australian workplaces.”