Clifford Gouldson Lawyers

Sushi shop penalised for worker's raw deal

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23/04/2018

Last month the Federal Circuit Court handed down a $200,000 penalty to a Sydney sushi outlet, its Director and the shop’s accountant for the underpayment of employee wages.

The Director was ordered to pay $30,000 of that amount for failing to pay three employees the minimum rates as set out in the Fast Food Industry Award 2010.

The three underpaid employees were nationals of the Republic of Korea, working in Australia on working holiday visas. An internship agreement with the Busan Institute of Science and Technology was entered into by the Director and the nationals for work experience to be provided by the sushi shop for a period of 12 months.

In the agreement, the students were to be paid a flat hourly rate of $12, with no extras such as weekend rates or overtime. This amount was found to be vastly under the minimum Award rate, which stood at around $16 to $20 an hour. It was uncovered that $50,000 worth of underpayments were owed to the employees over the course of their employment.

In addition to underpaying the employees, the Director and the shop’s accountant were found to have submitted false PAYG Payment summaries to the Fair Work Ombudsman. The Court stated that this constituted ‘the highest level of dishonesty’ and displayed that the shop was intentionally underpaying employees for its own personal financial advantage.

The shop was ordered to pay the appropriate amounts owed to the ex-employees, and was additionally ordered to pay the penalty of $200,000 imposed by the Court. $5,000 of that amount was ordered to be paid by the shop’s accountant for assisting with the dishonesty.

Cases like these make it apparent that businesses should ensure all employees are paid in accordance with relevant awards. If you require advice regarding remunerating your employees or how best to ensure compliance with modern awards, please contact our Workplace Team.

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