In a recent case, a Gold Coast man owned a security services company. He was the company’s sole director. The company employed security guards. For a period of 3 months, he had underpaid 8 of these employees more than $22, 000.

Even though the underpayments were acknowledged, the missing wages were not paid. The sole director had a history of non-compliance, and had been the director of two other liquidated security companies.

Following financial difficulties, the company went into administration. However, the director did not leave the industry, taking on a similar role as a consultant in another security company. This security company was run by his son, operated out of the same premise as the previous company, and even retained the same employees.

The underpaid security guards, after continuously failing to recover their owed entitlements from their old employer, took the case to court. The problem was, however, that the company was liquidated, and could therefore not pay compensation.

To fix the situation, the Court ordered that the director was personally liable for the unpaid wages, and ordered him to pay over $51, 000 out of his own pocket.

The Court decided this based on how influential the director was in the running of the new business. Its decision was intended to act as a deterrent both to the director and to others. The court’s decision was also based on the grounds that the director should not personally benefit from his misconduct.

The Court also considered that the director had liquidated the company in order to escape such liability as he was essentially running the same business under a different name.

This case shows that liquidation does not erase all past obligations. You still may have to face the consequences of past misconduct on a personal level.