18 Oct MISLEADING STATUTORY DECLARATION: PENNYCO
Pennyco Pty Ltd t/a Zarraffas West Ipswich  FWCFB 4852 (Pennyco) is one of the more unusual cases that have come before a Full Bench of the Fair Work Commission. The case is an appeal by an employer against the approval of its own enterprise agreement because false information was contained in statutory declarations filed by the employer in support of the approval application.
Mr Scott Penrose and Mrs Nicole Penrose purchased a coffee franchise from Zarraffas Pty Ltd (Zarraffas) in June 2016. Mr Penrose was serving in the military and Mrs Penrose was working in an administrative role, neither had any experience running a business. As part of Zarraffas’ introductory package the entrepreneurs had received a list of recommended suppliers for starting their business including “Platinum Employee Relations” (Platinum) a human resources and industrial relations firm.
Mr Penrose contacted Platinum in mid-2016 and in the course of communication was advised by Mr Michael Corrigan about the benefits of having an EBA. Mr Corrigan provided Mr Penrose with a template EBA that Platinum had previously used, and with minor changes Mr Penrose agreed to the terms. Mr Corrigan sent through a draft version of the Fair Work Commission’s Form F17 Statutory Declaration.
At this point, Pennyco Pty Ltd had not employed any staff. However, Mr Penrose affirmed a statutory declaration on 19 September 2016 that stated:
- Employees were advised of a secret ballot that would take place to agree on the EBA;
- Employees were explained the terms of the agreement and their rights; and
- Out of eight employees, seven employees had agreed to cast a vote and that all seven had voted in favour of the EBA.
Mrs Penrose signed the EBA on behalf of the non-existent employees and on 18 October 2016 the EBA was approved by the Fair Work Commission.
It was not until 15 December 2016, when Mrs Penrose was completing Zarraffas’ induction training for franchisees on EBAs that the Penroses or Zarraffas became aware that there was an issue with the process.
The Full Bench extended the 21-day time period for the filing of an appeal because they were satisfied the public interest required these concerning circumstances to be addressed.
The Full Bench quashed the decision to approve the EBA and identified other agreements prepared by Platinum which should not have passed the BOOT.
The Penroses and Mr Corrigan filed witness statements to try and explain their conduct but did not attend the hearing to give sworn evidence. The Full Bench admitted these statements into evidence and decided to refer them to the General Manager of the Fair Work Commission so the General Manager could consider referring the statements to the Federal Police. This step was taken due to the possibility that offences had been committed under the Statutory Declarations Act 1959 (Cth) and the Criminal Code Act 1995 (Cth).
This case highlights the importance of ensuring correct information is included in any statutory declaration and particularly in those relied upon by the Fair Work Commission to determine whether an enterprise agreement should be approved. Whilst it should be obvious, the case also highlights the dangers associated with an external professional drafting the terms of a statutory declaration for a client who then executes the document without carefully reviewing the content.
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