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The Fair Work Ombudsman Has Secured Almost $400,000 in Penalties

Three individuals have systematically exploited employees and have been penalised.
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The Fair Work Ombudsman Has Secured Almost $400,000 in Penalties

The Fair Work Ombudsman Has Secured Almost $400,000 in Penalties

23 November 2017

This article originally appeared in Fair Work.

The Fair Work Ombudsman has secured approximately $400,000 in penalties against a company and three individuals for systematically exploiting employees at a Chinese restaurant in NSW and fabricating records to disguise their actions.

A total of $583,688 was underpaid to 85 of the restaurant's employees during a 16 month period, between 2013-2014. A majority of these employees were vulnerable workers with visas from Asia.

They were paid as little as $10 an hour. 

Under the Restaurant Industry Award at the time, the employees were entitled to more than $20 an hour for work during ordinary hours and between $25 - $45  an hour for weekend, public holiday and overtime work.

One employee was underpaid more than $33,000.

Therefore a penalty of $54,672 was imposed against the restaurant owner and leader of the exploitation.  The owner's company was further penalised $301,920. The restaurant manager was fined $18,496 for their deliberate involvement in the exploitation 

Furthermore, the HR manager was penalised  $21,760. Justice Bromwich dismissed the HR manager's argument that their culpability was significantly reduced due to following her boss's orders. Justice Bromwich rejected her submission, finding she had “acted in her own interests” by being a participant in the underpayments and in taking an active role in the creation of false records.

Acting Fair Work Ombudsman Kristen Hannah says the outcome of the matter sends a clear message that the Fair Work Ombudsman is committed to using accessorial liability laws to hold individuals involved in exploiting vulnerable workers to account.

When the Fair Work Ombudsman began its investigation, fabricated records were given to inspectors that indicated staff had been paid correctly.

The company later provided the true employment records, only after the issue was raised with them by the Fair Work Inspector and a further Notice to Produce issued, showing the unlawfully low, flat rates the employees were actually paid.

"Where we find blatant exploitative conduct, we will do everything within our power to ensure that all accessories to that conduct are held to account."

“Rogue business owners and managers who think they can run operations based on the exploitation of vulnerable workers and then try to hide behind corporate structures or flimsy excuses are playing with fire.” 

“We are committed to actively seeking them out, dismantling their unlawful business models, making sure the public are aware of the actions and ensuring they are penalised for their conduct. Business models based on exploitation of employees to gain an unfair commercial advantage are unacceptable."

“Where we find blatant exploitative conduct, we will do everything within our power to ensure that all accessories to that conduct are held to account."

“This includes taking action against not only business owners and directors – but also any HR practitioners, accountants, industrial relations specialists and any other professionals involved in knowingly facilitating exploitation of employees," Ms Hannah said.

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