The Fair Work Ombudsman has abandoned its Federal Court case against the operators of a business engaged under the Federal Government’s former home insulation program.
The FWO announced yesterday that it has discontinued legal proceedings it began last year against K&L Insulation and its director, Louay Soliman of Reservoir, Victoria.
The FWO launched a prosecution against the business based in Campbellfield, Victoria after claiming it underpaid five teenage employees $25,000.
The workers, all Somali immigrants who were aged 18 and 19 at the time, were employed to install insulation materials into homes in various locations throughout Melbourne.
The FWO alleged the employees worked up to 10 hours a day, six days a week and some weeks were paid flat rates equating to as little as $10 an hour when they should have been paid $15.90 for normal hours and up to $31 for overtime and weekend work and $39 on public holidays.
At the time, FWO Nicholas Wilson said the decision to prosecute was made because of the significant amounts involved for vulnerable workers and K&L Insulation’s failure to rectify the matter.
“Workers from foreign backgrounds are often not fully aware of their workplace rights and youth, language and cultural barriers can make it difficult for them to negotiate their employment conditions,” Wilson said.
K&L Insulation faced fines of up to $33,000 per breach while Soliman could have been fined $6,600 per breach personally.
However, the FWO has now discontinued its Federal Court case and will not comment on the reasoning behind its move.
“The Fair Work Ombudsman has discontinued the legal proceedings following consideration of new information and other matters,” the FWO said in a statement.
Alastair Grigor, principal at law firm Grigor Lawyers which represented Soliman in the legal proceedings, said it was up to the FWO to comment on why it had chosen to abandon the case.
“The FWO initiated the prosecution, reviewed the case and then obviously had concerns about the paucity of evidence it had,” Grigor says.
“If they had sufficient evidence with which to prosecute Mr Soliman they would have proceeded with the case.”
SmartCompany contacted Soliman for comment but did not receive a response before publication.
Cara Waters is a former SmartCompany editor. Previously, Cara was a senior reporter for the Financial Times’ website and worked for The Sunday Times in London.
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