A contract cleaning company in regional Western Australia has been hit with almost $140,000 in penalties for underpaying employees more than $114,000 and falsifying records.

The Federal Circuit and Family Court imposed a $116,550 penalty against Carnarvon Cleaners Pty Ltd, based in Carnarvon, and a $23,310 penalty against the company’s sole director and shareholder, Margaret Herlysha Seaton.

The penalties were imposed after Carnarvon Cleaners and Seaton admitted underpaying 35 employees a total of $114,538 between November 2017 and November 2018.

The company and Seaton also admitted breaching record-keeping laws, including knowingly making false or misleading records and providing them to Fair Work Inspectors.

Carnarvon Cleaners employed most of the underpaid workers as cleaners to service the premises of its clients in Western Australia’s Gascoyne region. Some workers also performed gardening and trolley collecting duties.

The breaches occurred despite Carnarvon Cleaners and Seaton previously being made aware of their obligations by the Fair Work Ombudsman (FWO), following audits in 2010, 2013 and 2014 which found that the business had underpaid employees.

“The repeated underpayment of basic lawful minimum entitlements is unacceptable,” Fair Work Ombudsman Sandra Parker said.

“The seriousness of the conduct is compounded in this case by the use of false records. Employers who provide false records to Fair Work Inspectors will be found out and face enforcement action.

“Employers also need to be aware that improving compliance in the contract cleaning sector is a priority for the FWO. Any employees with concerns about their pay or entitlements should contact us for free advice and assistance,” Parker said.

A 2018 investigation of Carnarvon Cleaners found the company had underpaid employees’ minimum-engagement pay, casual loadings, part-time allowances, public holiday penalty rates, overtime rates, annual leave loading and broken-shift allowances owed under the Cleaning Services Award 2010.

Individual underpayments ranged from $69 to $16,303. All workers have been back-paid.

Judge Allyson Ladhams described the conduct of Carnarvon Cleaners and Seaton as “negligent or careless” and found that there had been a “repeated pattern of failing to pay the appropriate employee entitlements”.

Judge Ladhams found that the falsification of records and failure to pay the correct Award entitlements, particularly to employees who are vulnerable and in low income roles in a competitive service industry such as the cleaning services industry, warranted meaningful penalties.

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