Victoria's Peninsula Health was found to have failed to pay Gaby Bolton overtime 208 times between 2019 and 2021, when she was working as a doctor in training at Frankston Hospital.
The Federal Court in August 2023 found Peninsula Health had contravened the Fair Work Act in failing to pay Dr Bolton's entitlements for unrostered overtime.
Peninsula Health was found to have contravened the Fair Work Act. (James Ross/AAP PHOTOS)
Peninsula Health had planned to try and overturn the decision, but abandoned its appeal in February.
Justice Mordy Bromberg ordered the health service pay a $316, 260 penalty for its breaches on Thursday.
Dr Bolton said the court's condemnation was "a sign of hope for thousands of junior doctors across the state, who simply want to be paid their minimum entitlements for the work they perform".
"I look forward to the day when, like our counterparts in NSW and the ACT, junior doctors don't have to fight in court to be paid for the hours we worked," she said in a statement.
Several Victorian health services, including Peninsula Health, are facing class actions by junior doctors over allegations of widespread and systemic underpayments.
Australian Medical Association Victoria president Jill Tomlinson said the penalty was an indictment on the state government for failing to settle doctor pay disputes outside court as other states have.
"The extremely belligerent attitude of those at the top is no doubt what has motivated such a strong rebuke from the court," she said.Â
"Today should be a day that causes reflection at the very top of our health system and brings the key decision-makers in the Department of Health to the negotiating table with a full appreciation of the extent of the harm being caused by their inaction."
Gordon Legal partner Andrew Grech, which is acting for Dr Bolton and the Australian Salaried Medical Officers' Federation, said the penalty was a "groundbreaking legal victory".
He said it reinforced the need for Victoria's health minister to intervene and avoid further costly court action.
"Leaving aside the financial toll on junior doctors, without a court-approved redress scheme the damage done to the reputation of the Victorian public health system cannot be repaired," he said.
Peninsula Health said the service had implemented changes since 2021 and it would carefully review the judgment and penalty.
"We expect our junior doctors to record any overtime worked on their timesheets so we can make those payments," chief medical officer Shyaman Menon said in a statement.
"Our junior doctors are an essential part of the future of our organisation and we acknowledge the important contribution they make across all our hospitals and healthcare sites."
Victoria's health department has been contacted for its response.
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